AGREEMENT AND PLAN OF MERGER
BY AND BETWEEN
XXXXXXX FINANCIAL CORPORATION
AND
EAGLE FINANCIAL CORP.
DATED AS OF
OCTOBER 26, 1997
TABLE OF CONTENTS
Page
ARTICLE I THE MERGER.................................. 2
1.1 The Merger.................................. 2
1.2 Effective Time.............................. 2
1.3 Effects of the Merger....................... 2
1.4 Conversion of Eagle Common Stock............ 2
1.5 Webster Common Stock........................ 4
1.6 Options..................................... 4
1.7 Certificate of Incorporation................ 5
1.8 By-Laws..................................... 5
1.9 Directors and Officers...................... 5
1.10 Tax Consequences............................ 6
1.11 Accounting Treatment........................ 6
ARTICLE II EXCHANGE OF SHARES.......................... 6
2.1 Webster to Make Shares Available............ 6
2.2 Exchange of Shares.......................... 6
ARTICLE II-A DISCLOSURE SCHEDULE; STANDARDS FOR
REPRESENTATIONS AND WARRANTIES............ 8
2A.1 Disclosure Schedule......................... 8
2A.2 Standards................................... 9
ARTICLE III REPRESENTATIONS AND WARRANTIES
OF EAGLE.................................. 9
3.1 Corporate Organization...................... 9
3.2 Capitalization.............................. 10
3.3 Authority; No Violation..................... 12
3.4 Consents and Approvals...................... 13
3.5 Loan Portfolio; Reports..................... 14
3.6 Financial Statements; Exchange Act
Filings; Books and Records................ 15
3.7 Broker's Fees............................... 16
3.8 Absence of Certain Changes or Events........ 16
3.9 Legal Proceedings........................... 17
3.10 Taxes and Tax Returns....................... 17
3.11 Employee Plans.............................. 18
3.12 Certain Contracts........................... 21
3.13 Agreements with Regulatory Agencies......... 22
3.14 State Takeover Laws;
Certificate of Incorporation............... 22
3.15 Environmental Matters....................... 23
3.16 Reserves for Losses......................... 24
3.17 Properties and Assets....................... 24
3.18 Insurance................................... 25
3.19 Compliance with Applicable Laws............. 26
3.20 Loans....................................... 26
3.21 Ownership of Webster Common Stock........... 27
3.22 Eagle DRIP.................................. 28
3.23 Fairness Opinion............................ 28
3.24 Tax and Accounting Treatment of Merger...... 28
3.25 Rights Agreement............................ 28
3.26 Eagle Information........................... 28
ARTICLE IV REPRESENTATIONS AND WARRANTIES
OF WEBSTER................................ 29
4.1 Corporate Organization...................... 29
4.2 Capitalization.............................. 29
4.3 Authority; No Violation..................... 30
4.4 Regulatory Approvals........................ 32
4.5 Financial Statements; Exchange Act
Filings; Books and Records................ 33
4.6 Absence of Certain Changes or Events........ 34
4.7 Compliance with Applicable Law.............. 34
4.8 Ownership of Eagle Common Stock;
Affiliates and Associates.................. 35
4.9 Employee Benefit Plans...................... 35
4.10 Agreements with Regulatory Agencies......... 35
4.11 Tax and Accounting Treatment of Merger...... 35
4.12 Legal Proceedings........................... 36
4.13 Reserves for Losses......................... 36
4.14 Broker's Fees............................... 36
4.15 Fairness Opinion............................ 37
4.16 Taxes....................................... 37
4.17 Webster Information......................... 37
ARTICLE V COVENANTS RELATING TO CONDUCT OF BUSINESS.... 38
5.1 Covenants of Eagle.......................... 38
5.2 Covenants of Webster........................ 43
5.3 Merger Covenants............................ 43
5.4 Employment and Other Agreements............. 44
ARTICLE VI ADDITIONAL AGREEMENTS....................... 44
6.1 Regulatory Matters.......................... 44
6.2 Access to Information....................... 46
6.3 Stockholder Meetings........................ 47
6.4 Legal Conditions to Merger.................. 47
6.5 Stock Exchange Listing...................... 48
6.6 Employees................................... 48
6.7 Indemnification............................. 49
6.8 Subsequent Interim and Annual Financial
Statements................................. 51
6.9 Additional Agreements....................... 51
6.10 Advice of Changes........................... 51
6.11 Current Information......................... 52
6.12 Execution and Authorization of
Bank Merger Agreement...................... 52
6.13 Change in Structure......................... 52
6.14 Transaction Expenses of Eagle............... 52
6.15 Affiliate Agreements........................ 53
ARTICLE VII CONDITIONS PRECEDENT....................... 53
7.1 Conditions to Each Party's Obligation
To Effect the Merger....................... 53
7.2 Conditions to Obligations of Webster........ 55
7.3 Conditions to Obligations of Eagle.......... 56
ARTICLE VIII TERMINATION AND AMENDMENT................. 57
8.1 Termination................................. 57
8.2 Effect of Termination....................... 61
8.3 Amendment................................... 61
8.4 Extension; Waiver........................... 62
ARTICLE IX GENERAL PROVISIONS.......................... 62
9.1 Closing..................................... 62
9.2 Nonsurvival of Representations,
Warranties and Agreements.................. 62
9.3 Expenses.................................... 62
9.4 Notices..................................... 63
9.5 Interpretation.............................. 64
9.6 Counterparts................................ 64
9.7 Entire Agreement............................ 64
9.8 Governing Law............................... 64
9.9 Enforcement of Agreement.................... 65
9.10 Severability................................ 65
9.11 Publicity................................... 65
9.12 Assignment; Limitation of Benefits.......... 65
9.13 Additional Definitions...................... 66
EXHIBITS
A Form of Articles of Combination and
Bank Merger Agreement
B Form of Option Agreement
C Form of Certificate of Merger
D Form of Agreement of Eagle Affiliates
E Form of Agreement of Webster Affiliates
AGREEMENT AND PLAN OF MERGER
This AGREEMENT AND PLAN OF MERGER, dated as of Octo-
ber 26, 1997 (this "Agreement"), is entered into by and between
Xxxxxxx Financial Corporation, a Delaware corporation ("Web-
ster") and Eagle Financial Corp., a Delaware corporation
("Eagle").
WHEREAS, the Boards of Directors of Webster and Eagle
have determined that it is in the best interests of their re-
spective companies and stockholders to consummate the business
combination transaction provided for herein in which Eagle
will, subject to the terms and conditions set forth herein,
merge with and into Webster, with Webster being the surviving
corporation in such merger (the "Merger");
WHEREAS, prior to the consummation of the Merger,
Webster and Eagle will respectively cause Xxxxxxx Bank, a fed-
eral savings bank and wholly-owned subsidiary of Webster, and
Eagle Bank ("Eagle Bank"), a federally chartered savings bank
and wholly-owned subsidiary of Eagle, to enter into a merger
agreement, in the form attached hereto as Exhibit A (the "Bank
Merger Agreement"), providing for the merger (the "Bank
Merger") of Eagle Bank with and into Xxxxxxx Bank, with Xxxxxxx
Bank being the "Surviving Bank" of the Bank Merger, and it is
intended that the Bank Merger be consummated immediately after
consummation of the Merger;
WHEREAS, as an inducement to Webster to enter into
this Agreement, Eagle will enter into an option agreement, in
the form attached hereto as Exhibit B (the "Option Agreement"),
with Webster immediately following the execution of this Agree-
ment pursuant to which Eagle will xxxxx Xxxxxxx an option to
purchase, under certain circumstances, an aggregate number of
newly issued shares of common stock equal to 19.9% of the out-
standing shares of common stock, par value $.01 per share, of
Eagle ("Eagle Common Stock") and otherwise upon the terms and
conditions therein contained; and
WHEREAS, the Merger is intended to be treated as a
"reorganization" within the meaning of Section 368(a) of the
Internal Revenue Code of 1986, as amended, and as a "pooling of
interests" under generally accepted accounting principles; and
WHEREAS, the parties desire to make certain represen-
tations, warranties and agreements in connection with the Merg-
er and also to prescribe certain conditions to the Merger;
NOW, THEREFORE, in consideration of the mutual cov-
enants, representations, warranties and agreements contained
herein, and intending to be legally bound hereby, the parties
agree as follows:
ARTICLE I
THE MERGER
1.1 THE MERGER.
Subject to the terms and conditions of this Agree-
ment, in accordance with the Delaware General Corporation Law
(the "DGCL") at the Effective Time (as defined in Section 1.2
hereof), Eagle shall merge with and into Webster, with Webster
being the surviving corporation (hereinafter sometimes called
the "Surviving Corporation") in the Merger. Upon consummation
of the Merger, the corporate existence of Eagle shall cease and
the Surviving Corporation shall continue to exist as a Delaware
corporation.
1.2 EFFECTIVE TIME.
The Merger shall become effective on the Closing Date
(as defined in Section 9.1 hereof), as set forth in the cer-
tificate of merger (the "Certificate of Merger") in the form
attached as Exhibit C hereto which shall be filed with the Sec-
retary of State of the State of Delaware on the Closing Date.
The term "Effective Time" shall be the date and time when the
Merger becomes effective on the Closing Date, as set forth in
the Certificate of Merger.
1.3 EFFECTS OF THE MERGER.
At and after the Effective Time, the Merger shall
have the effects set forth in Sections 259 and 261 of the DGCL.
1.4 CONVERSION OF EAGLE COMMON STOCK.
(a) At the Effective Time, subject to Sections
1.4(b), 1.4(c), 1.4(d) and 8.1(h) hereof, each share of Eagle
Common Stock issued and outstanding prior to the Effective
Time, together with the rights (the "Eagle Rights") attached
thereto issued pursuant to the Rights Agreement, dated as of
October 22, 1996 (the "Eagle Rights Agreement"), between Eagle
and The First National Bank of Boston, as Rights Agent, shall,
by virtue of this Agreement and without any action on the part
of the holder thereof, be converted into and exchangeable for
0.84 shares (the "Exchange Ratio") of the common stock, par
value $.01 per share, of Webster (the "Webster Common Stock"),
together with the number of rights ("Webster Rights") issued
pursuant to the Rights Agreement, dated as of February 5, 1996
(the "Webster Rights Agreement"), between Webster and Chemical
Mellon Shareholder Services, L.L.C., as Rights Agent, associ-
ated therewith. Notwithstanding any other provision of this
Agreement other than Sections 1.4(b) and 8.1(h), no more than
5,893,366 shares of Webster Common Stock (the "Maximum Share
Amount") shall be issued or become issuable in connection with
the Merger and the other transactions contemplated by this
Agreement (including shares issued or issuable in respect of
shares of any capital stock of Eagle, including Eagle Common
Stock, or any right to acquire any such capital stock).
(b) All of the shares of Eagle Common Stock
converted into Webster Common Stock pursuant to this Article I
shall no longer be outstanding and shall automatically be can-
celed and shall cease to exist, and each certificate (each a
"Certificate") previously representing any such shares of Eagle
Common Stock shall thereafter represent the right to receive
(i) the number of whole shares of Webster Common Stock and (ii)
cash in lieu of fractional shares into which the shares of
Eagle Common Stock represented by such Certificate have been
converted pursuant to this Section 1.4(b) and Section 2.2(e)
hereof. Certificates previously representing shares of Eagle
Common Stock shall be exchanged for certificates representing
whole shares of Webster Common Stock and cash in lieu of frac-
tional shares issued in consideration therefor upon the sur-
render of such Certificates in accordance with Section 2.2
hereof, without any interest thereon. If after the date hereof
and prior to the Effective Time Webster should split or combine
its common stock, or pay a dividend or other distribution in
such common stock, then the Exchange Ratio and the Maximum
Share Amount shall be appropriately adjusted to reflect such
split, combination, dividend or distribution.
(c) At the Effective Time, all shares of Eagle
Common Stock that are owned by Eagle as treasury stock and all
shares of Eagle Common Stock that are owned directly or indi-
rectly by Webster or Eagle or any of their respective Subsid-
iaries (other than shares of Eagle Common Stock held directly
or indirectly in trust accounts, managed accounts and the like
or otherwise held in a fiduciary capacity that are beneficially
owned by third parties (any such shares, and shares of Webster
Common Stock which are similarly held, whether held directly or
indirectly by Webster or Eagle, as the case may be, being re-
ferred to herein as "Trust Account Shares") and other than any
shares of Eagle Common Stock held by Webster or Eagle or any of
their respective Subsidiaries in respect of a debt previously
contracted (any such shares of Eagle Common Stock, and shares
of Webster Common Stock which are similarly held, whether held
directly or indirectly by Webster or Eagle, being referred to
herein as "DPC Shares")) shall be canceled and shall cease to
exist and no stock of Webster or other consideration shall be
delivered in exchange therefor. All shares of Webster Common
Stock that are owned by Eagle or any of its Subsidiaries (other
than Trust Account Shares and DPC Shares) shall become treasury
stock of Webster.
(d) Certificates for fractions of shares of
Webster Common Stock will not be issued. In lieu of a fraction
of a share of Webster Common Stock, each holder of Eagle Common
Stock otherwise entitled to a fraction of a share of Webster
Common Stock shall be entitled to receive an amount of cash
equal to (i) the fraction of a share of the Webster Common
Stock to which such holder would otherwise be entitled, multi-
plied by (ii) the market value of the Webster Common Stock,
which shall be deemed to be the average of the daily closing
prices per share for Webster Common Stock for the twenty con-
secutive trading days on which shares of Webster Common Stock
are actually traded (as reported on the Nasdaq Stock Market
National Market) ending on the third trading day preceding the
Closing Date. Following consummation of the Merger, no holder
of Eagle Common Stock shall be entitled to dividends or any
other rights in respect of any such fraction.
1.5 WEBSTER COMMON STOCK.
Each share of Webster Common Stock issued and out-
standing immediately prior to the Effective Time shall be un-
changed and shall remain issued and outstanding as common stock
of the Surviving Corporation.
1.6 OPTIONS.
At the Effective Time, each option granted by Eagle
to purchase shares of Eagle Common Stock which is outstanding
and unexercised immediately prior thereto shall be converted
automatically into an option to purchase shares of Webster Com-
mon Stock in an amount and at an exercise price determined as
provided below (and otherwise subject to the terms of the Eagle
Financial Corp. Stock Option Plan (the "Eagle Stock Plan"), the
BFS Bancorp, Inc. Stock Option Plan (the "BFS Plan") or the
Eagle Financial Corp. 1988 Stock Option Plan (the "1988 Plan")
(the Eagle Stock Plan, the BFS Plan and the 1988 Plan collec-
tively the "Eagle Stock Plans"), in each case, under which such
option was granted):
(1) The number of shares of Webster Common
Stock to be subject to the option immediately after the Effec-
tive Time shall be equal to the product of the number of shares
of Eagle Common Stock subject to the option immediately before
the Effective Time, multiplied by the Exchange Ratio, provided
that any fractional shares of Webster Common Stock resulting
from such multiplication shall be rounded down to the nearest
share; and
(2) The exercise price per share of Web-
ster Common Stock under the option immediately after the Effec-
tive Time shall be equal to the exercise price per share of
Eagle Common Stock under the option immediately before the Ef-
fective Time divided by the Exchange Ratio, provided that such
exercise price shall be rounded to the nearest cent.
The adjustment provided herein shall be and is intended to be
effected in a manner which is consistent with Section 424(a) of
the Internal Revenue Code of 1986, as amended (the "Code").
The duration and other terms of the option immediately after
the Effective Time shall be the same as the corresponding terms
in effect immediately before the Effective Time, except that
all references to Eagle or Eagle Bank in the Eagle Stock Plans
(and the corresponding references in the option agreement docu-
xxxxxxx such option) shall be deemed to be references to Web-
ster.
1.7 CERTIFICATE OF INCORPORATION.
At the Effective Time, the Certificate of Incorpora-
tion of Webster, as in effect at the Effective Time, shall be
the Certificate of Incorporation of the Surviving Corporation.
1.8 BY-LAWS.
At the Effective Time, the By-Laws of Webster, as in
effect immediately prior to the Effective Time, shall be the
By-Laws of the Surviving Corporation.
1.9 DIRECTORS AND OFFICERS.
At the Effective Time, the directors and officers of
Webster immediately prior to the Effective Time shall continue
to be directors and officers of the Surviving Corporation.
Three directors of Eagle, to be selected by the Board of Direc-
tors of Webster in consultation with Eagle, shall be invited to
serve as additional members (the "New Members") of the Board of
Directors of Webster. The New Members will receive directors
fees on the same basis as other non-employee directors of Web-
ster. In addition, the other non-employee directors of Eagle
serving immediately prior to the Effective Time will be invited
to serve on an advisory board to Webster after the Bank Merger
for a period not less than 24 months following the Effective
Time. Such advisory directors will each be paid a retainer of
$3,250 per quarter and a meeting fee of $1,750 per meeting for
such service, such advisory board to meet not less frequently
than 4 times per year.
1.10 TAX CONSEQUENCES.
It is intended that the Merger, either alone or in
conjunction with the Bank Merger, shall constitute a reorgani-
zation within the meaning of Section 368(a) of the Code, and
that this Agreement shall constitute a "plan of reorganization"
for the purposes of the Code.
1.11 ACCOUNTING TREATMENT.
It is intended that the Merger shall be accounted for
as a "pooling of interests" under generally accepted accounting
principles ("GAAP").
ARTICLE II
EXCHANGE OF SHARES
2.1 WEBSTER TO MAKE SHARES AVAILABLE.
At or prior to the Effective Time, Webster shall de-
posit, or shall cause to be deposited, with Xxxxxxx'x transfer
agent, American Stock Transfer & Trust Company, or such other
bank, trust company or transfer agent as Webster may select
(the "Exchange Agent"), for the benefit of the holders of Cer-
tificates, for exchange in accordance with this Article II,
certificates representing the shares of Webster Common Stock
and the cash in lieu of fractional shares (such cash and cer-
tificates for shares of Webster Common Stock, being hereinafter
referred to as the "Exchange Fund") to be issued pursuant to
Section 1.4 and paid pursuant to Section 2.2(a) hereof in ex-
change for outstanding shares of Eagle Common Stock.
2.2 EXCHANGE OF SHARES.
(a) As soon as practicable after the Effective
Time, the Exchange Agent shall mail to each holder of record of
a Certificate or Certificates a form letter of transmittal
(which shall specify that delivery shall be effected, and risk
of loss and title to the Certificates shall pass, only upon
delivery of the Certificates to the Exchange Agent) and in-
structions for use in effecting the surrender of the Certifi-
xxxxx in exchange for certificates representing the shares of
Webster Common Stock and the cash in lieu of fractional shares
into which the shares of Eagle Common Stock represented by such
Certificate or Certificates shall have been converted pursuant
to this Agreement. Eagle shall have the right to review both
the letter of transmittal and the instructions prior to such
documents being finalized. Upon surrender of a Certificate for
exchange and cancellation to the Exchange Agent, together with
such letter of transmittal, duly executed, the holder of such
Certificate shall be entitled to receive in exchange therefor
(x) a certificate representing that number of whole shares of
Webster Common Stock to which such holder of Eagle Common Stock
shall have become entitled pursuant to the provisions of Ar-
ticle I hereof and (y) a check representing the amount of cash
in lieu of fractional shares, if any, which such holder has the
right to receive in respect of the Certificate surrendered pur-
suant to the provisions of this Article II, and the Certificate
so surrendered shall forthwith be canceled. No interest will
be paid or accrued on the cash in lieu of fractional shares and
unpaid dividends and distributions, if any, payable to holders
of Certificates.
(b) No dividends or other distributions de-
clared after the Effective Time with respect to Webster Common
Stock and payable to the holders of record thereof shall be
paid to the holder of any unsurrendered Certificate until the
holder thereof shall surrender such Certificate in accordance
with this Article II. After the surrender of a Certificate in
accordance with this Article II, the record holder thereof
shall be entitled to receive any such dividends or other dis-
tributions, without any interest thereon, which theretofore
had become payable with respect to shares of Webster Common
Stock represented by such Certificate. No holder of an unsur-
rendered Certificate shall be entitled, until the surrender of
such Certificate, to vote the shares of Webster Common Stock
into which his Eagle Common Stock shall have been converted.
2.3 If any certificate representing shares of
Webster Common Stock is to be issued in a name other than that
in which the Certificate surrendered in exchange therefor is
registered, it shall be a condition of the issuance thereof
that the Certificate so surrendered shall be properly endorsed
(or accompanied by an appropriate instrument of transfer) and
otherwise in proper form for transfer, and that the person re-
questing such exchange shall pay to the Exchange Agent in ad-
xxxxx any transfer or other taxes required by reason of the
issuance of a certificate representing shares of Webster Common
Stock in any name other than that of the registered holder of
the Certificate surrendered, or shall establish to the satis-
faction of the Exchange Agent that such tax has been paid or is
not payable.
(a) After the close of business on the day im-
mediately prior to the Effective Time, there shall be no trans-
fers on the stock transfer books of Eagle of the shares of
Eagle Common Stock which were issued and outstanding immediate-
ly prior to the Effective Time. If, after the Effective Time,
Certificates representing such shares are presented for trans-
fer to the Exchange Agent, they shall be canceled and ex-
changed for certificates representing shares of Webster Common
Stock as provided in this Article II.
(b) Any portion of the Exchange Fund that re-
mains unclaimed by the stockholders of Eagle for six months
after the Effective Time shall be returned to Webster. Any
stockholders of Eagle who have not theretofore complied with
this Article II shall thereafter look only to Webster for pay-
ment of their shares of Webster Common Stock, cash in lieu of
fractional shares and unpaid dividends and distributions on
Webster Common Stock deliverable in respect of each share of
Eagle Common Stock such stockholder holds as determined pursu-
ant to this Agreement, in each case, without any interest
thereon. Notwithstanding the foregoing, none of Webster,
Eagle, the Exchange Agent or any other person shall be liable
to any former holder of shares of Eagle Common Stock for any
amount properly delivered to a public official pursuant to ap-
plicable abandoned property, escheat or similar laws.
(c) In the event any Certificate shall have
been lost, stolen or destroyed, upon the making of an affidavit
of that fact by the person claiming such Certificate to be
lost, stolen or destroyed and, if required by Webster, the
posting by such person of a bond in such amount as Webster may
reasonably direct as indemnity against any claim that may be
made against it with respect to such Certificate, the Exchange
Agent will issue in exchange for such lost, stolen or destroyed
Certificate the shares of Webster Common Stock and cash in lieu
of fractional shares deliverable in respect thereof pursuant to
this Agreement.
ARTICLE II-A
DISCLOSURE SCHEDULE; STANDARDS
FOR REPRESENTATIONS AND WARRANTIES
2A.1 Disclosure Schedule. Prior to the execu-
tion and delivery hereof, Eagle has delivered to Webster a
schedule (the "Eagle Disclosure Schedule") setting forth, among
other things, items the disclosure of which is necessary or
appropriate either in response to an express disclosure re-
quirements contained in a provision hereof or as an exception
to one or more of such party's representations or warranties
contained in Article III or to one or more of its covenants
contained in Article V; provided, however, that (a) subject to
Section 3.18, no such item is required to be set forth by ei-
ther party hereto in a Disclosure Schedule as an exception to a
representation or warranty if its absence would not result in
the related representation or warranty being deemed untrue or
incorrect under the standard established by Section 2A.2, and
(b) the mere inclusion of an item in a Disclosure Schedule as
an exception to a representation or warranty shall not be
deemed an admission by a party that such item represents a ma-
terial exception or fact, event or circumstance or that such
item has had or would have a Material Adverse Effect (as de-
fined in Section 9.13) with respect to such party.
2A.2 Standards. No representation or warranty of
Eagle contained in Article III or of Xxxxxxx contained in Ar-
ticle IV shall be deemed untrue or incorrect for any purpose
under this Agreement, and no party hereto shall be deemed to
have breached a representation or warranty for any purpose un-
der this Agreement, as a consequence of the existence or ab-
sence of any fact, circumstance or event unless such fact, cir-
cumstance or event, individually or when taken together with
all other facts, circumstances or events inconsistent with any
representations or warranties contained in Article III, in the
case of Eagle, or Article IV, in the case of Xxxxxxx, has had
or would be reasonably certain to have a Material Adverse Ef-
fect with respect to Eagle or Xxxxxxx, respectively.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF EAGLE
Eagle hereby makes the following representations and
warranties to Xxxxxxx as set forth in this Article III, each of
which is being relied upon by Xxxxxxx as a material inducement
to it to enter into and perform this Agreement.
3.1 CORPORATE ORGANIZATION.
(a) Eagle is a corporation duly organized, val-
idly existing and in good standing under the laws of the State
of Delaware. Eagle has the corporate power and authority to
own or lease all of its properties and assets and to carry on
its business as it is now being conducted, and is duly licensed
or qualified to do business in each jurisdiction in which the
nature of any material business conducted by it or the charac-
ter or location of any material properties or assets owned or
leased by it makes such licensing or qualification necessary.
Eagle is duly registered as a savings and loan holding company
with the Office of Thrift Supervision (the "OTS") under the
Home Owners' Loan Act of 1933 (the "HOLA"). The Restated Cer-
tificate of Incorporation and By-Laws of Eagle, copies of which
have previously been delivered to Xxxxxxx, are true, correct
and complete copies of such documents as in effect as of the
date of this Agreement.
(b) Eagle Bank is a federally chartered savings
bank duly organized, validly existing and in good standing un-
der the laws of the United States. The deposit accounts of
Eagle Bank are insured by the Federal Deposit Insurance Cor-
poration (the "FDIC") through the Savings Association Insurance
Fund (the "SAIF") to the fullest extent permitted by law, and
all premiums and assessments required in connection therewith
have been paid by Eagle Bank. Eagle Bank is the only subsid-
iary of Eagle that is a "Significant Subsidiary" as such term
is defined in Regulation S-X promulgated by the Securities and
Exchange Commission (the "SEC"). Eagle Bank has the corporate
or other power and authority to own or lease all of its proper-
ties and assets and to carry on its business as it is now being
conducted and is duly licensed or qualified to do business in
each jurisdiction in which the nature of any material business
conducted by it or the character or the location of any mate-
rial properties or assets owned or leased by it makes such li-
censing or qualification necessary. The Certificate of Incor-
poration and By-Laws of Eagle Bank, copies of which have previ-
ously been delivered to Xxxxxxx, are true, correct and complete
copies of such documents as in effect as of the date of this
Agreement.
3.2 CAPITALIZATION.
(a) The authorized capital stock of Eagle con-
sists of 8,000,000 shares of Eagle Common Stock and 2,000,000
shares of serial preferred stock, par value $.01 per share (the
"Eagle Preferred Stock"). As of the date hereof, there are (x)
6,316,537 shares of Eagle Common Stock issued and outstanding
and an additional 47,373 shares of Eagle Common Stock held in
Eagle's treasury, (y) no shares of Eagle Common Stock reserved
for issuance upon exercise of outstanding stock options or oth-
erwise, except for (i) 580,491 shares of Eagle Common Stock re-
served for issuance pursuant to the Eagle Stock Plans (of which
options for 518,688 shares are currently outstanding), (ii)
180,687 shares of Eagle Common Stock reserved for issuance pur-
suant to the Eagle DRIP (as defined herein) and (iii) 1,256,991
shares of Eagle Common Stock reserved for issuance upon exer-
cise of the option to be issued to Xxxxxxx pursuant to the Op-
tion Agreement, and (z) no shares of Eagle Preferred Stock is-
sued or outstanding, held in Eagle's treasury or reserved for
issuance upon exercise of outstanding stock options or oth-
erwise, except for 8,000 shares of Series A Participating Pre-
ferred Stock, par value $.01 per share, of Eagle reserved for
issuance upon exercise of the Eagle Rights. All of the issued
and outstanding shares of Eagle Common Stock have been duly
authorized and validly issued and are fully paid, nonassessable
and free of preemptive rights, with no personal liability at-
taching to the ownership thereof. Except for the Option Agree-
ment and the Eagle Stock Plans, Eagle does not have and is not
bound by any outstanding subscriptions, options, warrants,
calls, commitments or agreements of any character calling for
the purchase or issuance of any shares of Eagle Common Stock or
Eagle Preferred Stock or any other equity security of Eagle or
any securities representing the right to purchase or otherwise
receive any shares of Eagle Common Stock or any other equity
security of Eagle. The names of the optionees, the date of
each option to purchase Eagle Common Stock granted, the number
of shares subject to each such option and the price at which
each such option may be exercised under the Eagle Stock Plans
are set forth in Section 3.2(a) of the Eagle Disclosure Sched-
ule, and no such option expires more than 10 years from the
date of the grant thereof. Since September 30, 1997 Eagle has
not issued any shares of its capital stock or any securities
convertible into or exercisable for any shares of its capital
stock, other than pursuant to the exercise of director or em-
ployee stock options granted prior to September 30, 1997, under
the Eagle Stock Plans and pursuant to the Eagle Financial Corp.
Dividend Reinvestment Plan and Stock Purchase Plan (the "Eagle
DRIP").
(b) Section 3.2(b) of the Eagle Disclosure
Schedule sets forth a true, correct and complete list of all
Subsidiaries of Eagle as of the date of this Agreement. Eagle
owns, directly or indirectly, all of the issued and outstanding
shares of capital stock of each of its Subsidiaries, free and
clear of all liens, charges, encumbrances and security inter-
ests whatsoever, and all of such shares are duly authorized and
validly issued and are fully paid, nonassessable and free of
preemptive rights, with no personal liability attaching to the
ownership thereof. No Eagle Subsidiary has or is bound by any
outstanding subscriptions, options, warrants, calls, commit-
ments or agreements of any character calling for the purchase
or issuance of any shares of capital stock or any other equity
security of such Subsidiary or any securities representing the
right to purchase or otherwise receive any shares of capital
stock or any other equity security of such Subsidiary.
3.3 AUTHORITY; NO VIOLATION.
(a) Eagle has full corporate power and author-
ity to execute and deliver this Agreement and the Option Agree-
ment and to consummate the transactions contemplated hereby and
thereby. The execution and delivery of this Agreement and the
Option Agreement and the consummation of the transactions con-
templated hereby and thereby have been duly and validly ap-
proved by the Board of Directors of Eagle. The Board of Direc-
tors of Eagle has directed that this Agreement and the transac-
tions contemplated hereby be submitted to Eagle's stockholders
for approval at a special meeting of such stockholders and,
except for the adoption of this Agreement by the requisite vote
of Eagle's stockholders and the requisite approval, if any, of
Eagle stockholders in connection with the Option Agreement pur-
suant to the Eagle Restated Certificate of Incorporation, no
other corporate proceedings on the part of Eagle (except for
matters related to setting the date, time, place and record
date for the special meeting) are necessary to approve this
Agreement or the Option Agreement or to consummate the transac-
tions contemplated hereby or thereby. This Agreement has been,
and the Option Agreement will be, duly and validly executed and
delivered by Eagle and (assuming due authorization, execution
and delivery by Xxxxxxx of this Agreement and of the Option
Agreement) this Agreement constitutes, and the Option Agreement
will constitute, a valid and binding obligation of Eagle, en-
forceable against Eagle in accordance with its terms, except as
enforcement may be limited by general principles of equity
whether applied in a court of law or a court of equity and by
bankruptcy, insolvency and similar laws affecting creditors'
rights and remedies generally.
(b) Eagle Bank has full corporate or other
power and authority to execute and deliver the Bank Merger
Agreement and to consummate the transactions contemplated
thereby. The execution and delivery of the Bank Merger Agree-
ment and the consummation of the transactions contemplated
thereby will be duly and validly approved by the Board of Di-
rectors of Eagle Bank, and by Eagle as the sole stockholder of
Eagle Bank prior to the Effective Time. All corporate pro-
ceedings on the part of Eagle Bank necessary to consummate the
transactions contemplated thereby will have been taken prior to
the Effective Time. The Bank Merger Agreement, upon execution
and delivery by Eagle Bank, will be duly and validly executed
and delivered by Eagle Bank and will (assuming due authori-
zation, execution and delivery by Xxxxxxx Bank) constitute a
valid and binding obligation of Eagle Bank, enforceable against
Eagle Bank in accordance with its terms, except as enforcement
may be limited by general principles of equity whether applied
in a court of law or a court of equity and by bankruptcy, in-
solvency and similar laws affecting creditors' rights and rem-
edies generally.
(c) Neither the execution and delivery of this
Agreement and the Option Agreement by Eagle or the Bank Merger
Agreement by Eagle Bank, nor the consummation by Eagle or Eagle
Bank, as the case may be, of the transactions contemplated
hereby or thereby, nor compliance by Eagle or Eagle Bank with
any of the terms or provisions hereof or thereof, will (i) vio-
late any provision of the Restated Certificate of Incorporation
or By-Laws of Eagle or the Certificate of Incorporation or By-
Laws of Eagle Bank, or (ii) assuming that the consents and ap-
provals referred to in Section 3.4 hereof are duly obtained,
(x) violate any Laws (as defined in Section 9.13) applicable to
Eagle or Eagle Bank, or any of their respective properties or
assets, or (y) violate, conflict with, result in a breach of
any provision of or the loss of any benefit under, constitute a
default (or an event which, with notice or lapse of time, or
both, would constitute a default) under, result in the termina-
tion of or a right of termination or cancellation under, accel-
erate the performance required by, or result in the creation of
any lien, pledge, security interest, charge or other encum-
brance upon any of the respective properties or assets of Eagle
or Eagle Bank under, any of the terms, conditions or provisions
of any note, bond, mortgage, indenture, deed of trust, license,
lease, agreement or other instrument or obligation to which
Eagle or Eagle Bank is a party, or by which they or any of
their respective properties or assets may be bound or affected.
3.4 CONSENTS AND APPROVALS.
(a) Except for (i) the filing of applications
and notices, as applicable, as to the Merger and the Bank
Merger with the OTS under the HOLA and the Bank Merger Act and
approval of such applications and notices, (ii) the filing with
the SEC of a registration statement on Form S-4 to register the
shares of Xxxxxxx Common Stock to be issued in connection with
the Merger (including the shares of Xxxxxxx Common Stock that
may be issued upon the exercise of the options referred to in
Section 1.6 hereof), which will include the joint proxy
statement/prospectus (the "Joint Proxy Statement/Prospectus")
to be used in soliciting the requisite approvals of Xxxxxxx
stockholders and Eagle stockholders at special meetings of such
stockholders (the "Eagle Meeting" and the "Xxxxxxx Meeting,"
respectively) to be held in connection with this Agreement and
the transactions contemplated hereby, (iii) the approval of
this Agreement by the requisite vote of the stockholders of
Eagle and the requisite approval, if any, of Eagle stockholders
in connection with the Option Agreement pursuant to the Eagle
Restated Certificate of Incorporation, (iv) the approval of
this Agreement by the requisite vote of the stockholders of
Xxxxxxx, (v) the filing of the Certificate of Merger with the
Secretary of State of Delaware pursuant to the DGCL and (vi)
the filings required in connection with the Bank Merger Agree-
ment and the Bank Merger, no consents or approvals of or fil-
ings or registrations with any court, administrative agency or
commission or other governmental authority or instrumentality
(each a "Governmental Entity"), or with any third party are
necessary in connection with (1) the execution and delivery by
Eagle of this Agreement and the Option Agreement, (2) the con-
summation by Eagle of the Merger and the other transactions
contemplated hereby, (3) the execution and delivery by Eagle
Bank of the Bank Merger Agreement, (4) the consummation by
Eagle of transactions contemplated by the Option Agreement; and
(5) the performance by Eagle Bank of the Bank Merger Agreement
and the transactions contemplated thereby, except, in each
case, for such consents, approvals or filings, the failure of
which to obtain will not have a material adverse effect on the
ability of Xxxxxxx to consummate the transactions contemplated
hereby.
(b) Eagle hereby represents to Xxxxxxx that, as
of the date of this Agreement, it has no knowledge of any rea-
son why approval or effectiveness of any of the applications,
notices or filings referred to in Section 3.4(a) cannot be ob-
tained or granted on a timely basis.
3.5 LOAN PORTFOLIO; REPORTS.
(a) Except as disclosed on Schedule 3.5(a),
neither Eagle nor Eagle Bank is a party to any written or oral
loan agreement, note or borrowing arrangement (including, with-
out limitation, leases, credit enhancements, commitments,
guarantees and interest-bearing assets) (collectively,
"Loans"), with any director, officer or five percent or greater
stockholder of Eagle or any of its Subsidiaries, or any Affili-
ated Person (as defined in Section 9.13) of the foregoing.
Within 10 business days after the date hereof, Eagle shall pro-
vide to Xxxxxxx a list of each employee of Eagle or its Subsid-
iaries with which Eagle or Eagle Bank is a party to any Loan.
(b) Eagle and Eagle Bank have timely filed all
reports, registrations and statements, together with any amend-
ments required to be made with respect thereto, that they were
required to file since December 31, 1995 with (i) the OTS, (ii)
the FDIC, (iii) the SEC and (iv) any self-regulatory organiza-
tion ("SRO") (collectively "Regulatory Agencies"). As of its
respective date, each such report, registration, statement and
amendment complied in all material respects with all rules and
regulations promulgated by the applicable Regulatory Agency and
did not contain any untrue statement of a material fact or omit
to state a material fact required to be stated therein or nec-
xxxxxx in order to make the statements therein, in light of the
circumstances under which they were made, not misleading, exce-
pt that information as of a later date shall be deemed to modi-
fy information as of an earlier date. Except for normal exami-
nations conducted by a Regulatory Agency in the regular course
of the business of Eagle and its Subsidiaries, no Governmental
Entity is conducting, or has conducted, any proceeding or in-
vestigation into the business or operations of Eagle or Eagle
Bank since December 31, 1995.
3.6 FINANCIAL STATEMENTS; EXCHANGE ACT FILINGS;
BOOKS AND RECORDS.
Eagle has previously delivered to Xxxxxxx true, cor-
rect and complete copies of (i) the audited consolidated bal-
ance sheets of Eagle and its Subsidiaries as of September 30
for the fiscal years 1995 and 1996 and the related audited con-
solidated statements of income, shareholders' equity and cash
flows for the fiscal years 1994 through 1996, inclusive, as
reported in Eagle's Annual Report on Form 10-K for the fiscal
year ended September 30, 1996 filed with the SEC under the Se-
curities Exchange Act of 1934, as amended (the "Exchange Act"),
in each case accompanied by the audit report of KPMG Peat Mar-
wick LLP, independent public accountants with respect to Eagle,
(ii) in draft form, the consolidated balance sheet of Eagle and
its Subsidiaries as of September 30, 1997 and the related con-
solidated statements of income, shareholders' equity and cash
flows for the fiscal year ended September 30, 1997 in the form
Eagle expects to file under the Exchange Act in connection with
its Form 10-K for the fiscal year ended September 30, 1997 and
(iii) the unaudited consolidated balance sheets of Eagle and
its Subsidiaries as of June 30, 1997 and 1996 and the related
unaudited consolidated statements of income, shareholders' eq-
uity and cash flows for the interim periods ended June 30, 1997
and 1996, as reported on Eagle's Quarterly Report on Form 10-Q
for the period ended June 30, 1997 filed with the SEC under the
Exchange Act. The financial statements referred to in this
Section 3.6 (including the related notes, where applicable)
fairly present, and the financial statements referred to in
Section 6.8 hereof will fairly present (subject, in the case of
the unaudited and draft statements, to recurring audit adjust-
ments normal in nature and amount), the results of the xxxxxxx-
dated operations and consolidated financial condition of Eagle
and its Subsidiaries for the respective fiscal periods or as of
the respective dates therein set forth; each of such statements
(including the related notes, where applicable) comply, and the
financial statements referred to in Section 6.8 hereof will
comply, with applicable accounting requirements and with the
published rules and regulations of the SEC with respect thereto
and each of such statements (including the related notes, where
applicable) has been, and the financial statements referred to
in Section 6.8 hereof will be prepared in accordance with GAAP
consistently applied during the periods involved, except in
each case as indicated in such statements or in the notes
thereto or, in the case of unaudited statements, as permitted
by Form 10-Q or, in the case of draft statements, subject to
revisions that in the aggregate will not be material. Eagle's
Annual Report on Form 10-K for the fiscal year ended September
30, 1996 and all reports subsequently filed under Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act (the "Eagle Ex-
change Act Reports") comply in all material respects with the
appropriate requirements for such reports under the Exchange
Act, and Eagle has previously delivered or made available to
Xxxxxxx true, correct and complete copies of such reports. The
books and records of Eagle and Eagle Bank have been, and are
being, maintained in all material respects in accordance with
GAAP and any other applicable legal and accounting require-
ments.
3.7 BROKER'S FEES.
Neither Eagle nor any Eagle Subsidiary nor any of
their respective officers or directors has employed any broker
or finder or incurred any liability for any broker's fees, com-
missions or finder's fees in connection with any of the trans-
actions contemplated by this Agreement, the Bank Merger Agree-
ment or the Option Agreement, except that Eagle has engaged,
and will pay a fee or commission to Sandler X'Xxxxx & Partners,
L.P. ("Sandler X'Xxxxx") in accordance with the terms of a let-
ter agreement between Sandler X'Xxxxx and Eagle, dated October
20, 1997, a true, complete and correct copy of which has been
previously delivered by Eagle to Xxxxxxx.
3.8 ABSENCE OF CERTAIN CHANGES OR EVENTS.
(a) Except as disclosed in any Eagle Exchange
Act Report filed with the SEC prior to the date of this Agree-
ment, since September 30, 1996 (i) neither Eagle nor any of its
Subsidiaries has incurred any material liability, except as
contemplated by this Agreement or in the ordinary course of
their business, (ii) neither Eagle nor any of its Subsidiaries
has discharged or satisfied any material lien or paid any mate-
rial obligation or liability (absolute or contingent), other
than in the ordinary course of business; (iii) neither Eagle
nor any of its Subsidiaries has sold, assigned, transferred,
leased, exchanged or otherwise disposed of any of its material
properties or assets other than in the ordinary course of busi-
ness; (iv) neither Eagle nor any of its Subsidiaries has suf-
fered any material damage, destruction, or loss, whether as a
result of fire, explosion, earthquake, accident, casualty, la-
bor trouble, requisition or taking of property by any Regula-
tory Authority, flood, windstorm, embargo, riot, act of God or
other casualty or event, whether or not covered by insurance;
(v) neither Eagle nor any of its Subsidiaries has cancelled or
compromised any debt, except for debts charged off or compro-
mised in accordance with the past practice of Eagle or such
Subsidiary, as the case may be, and (vi) no event has occurred
which has had or is reasonably certain to have, individually or
in the aggregate, a Material Adverse Effect on Eagle.
(b) Since September 30, 1996, Eagle and its
Subsidiaries have carried on their respective businesses in the
ordinary and usual course consistent with their past practices.
3.9 LEGAL PROCEEDINGS.
(a) Neither Eagle nor any of its Subsidiaries
is a party to any, and there are no pending or threatened, le-
gal, administrative, arbitration or other proceedings, claims,
actions or governmental or regulatory investigations of any
nature against Eagle or any of its Subsidiaries in which there
is a reasonable probability of any material recovery against or
other material adverse effect upon Eagle or any of its Subsid-
iaries or which challenge the validity or propriety of the
transactions contemplated by this Agreement, the Bank Merger
Agreement or the Option Agreement as to which there is a rea-
sonable probability of success.
(b) There is no injunction, order, judgment or
decree imposed upon Eagle, any of its Subsidiaries or the as-
sets of Eagle or any of its Subsidiaries.
3.10 TAXES AND TAX RETURNS.
(a) Each of Eagle and its Subsidiaries has duly
filed all material Federal, state, local and foreign Tax Re-
turns required to be filed by it on or prior to the date hereof
(all such returns being accurate and complete in all material
respects) and has duly paid or made provisions for the payment
of all material Taxes which have been incurred or are due or
claimed to be due from it by Federal, state, local and foreign
taxing authorities on or prior to the date hereof. All li-
ability with respect to the income tax returns of Eagle and its
Subsidiaries has been satisfied for all years to and including
1996. The Internal Revenue Service ("IRS") has not notified
Eagle of, or otherwise asserted, that there are any material
deficiencies with respect to the income tax returns of Eagle.
There are no material disputes pending, or claims asserted for,
Taxes or assessments upon Eagle or any of its Subsidiaries, nor
has Eagle or any of its Subsidiaries been requested to give any
waivers extending the statutory period of limitation applicable
to any Federal, state or local income tax return for any period.
For the purposes of this Agreement, "Taxes"
shall mean all taxes, charges, fees, levies, penalties or other
assessments imposed by any United States federal, state, local
or foreign taxing authority, including, but not limited to in-
come, excise, property, sales, transfer, franchise, payroll,
withholding, social security or other taxes, including any in-
terest, penalties or additions attributable thereto.
For purposes of this Agreement, "Tax Return"
shall mean any return, report, information return or other
document (including any related or supporting information) with
respect to Taxes.
(b) Eagle Funding Corp. (i) will be, for the
taxable year ended December 31, 1997 and at the Effective Time,
a "real estate investment trust" as defined in Section 856(a)
of the Code, (ii) will meet, for the taxable year ended Decem-
ber 31, 1997 and at the Effective Time, the requirements of
Section 857(a) of the Code, (iii) will not be, for the taxable
year ended December 31, 1997 or at the Effective Time, de-
scribed in Section 856(c)(7) of the Code, (iv) has not had, and
at the Effective Time will not have had, any "net income de-
rived from prohibited transactions" within the meaning of Sec-
tion 857(b)(6) of the Code, (v) has not, and at the Effective
Time will not have, issued any stock or securities as part of a
multiple party financing transaction described in Internal Rev-
enue Service Notice 97-21, 1997-11 I.R.B. 2, and (vi) will be,
for the taxable year ended December 31, 1997 and at the Effec-
tive Time, a "Qualified Real Estate Investment Trust" of which
Eagle Bank will be for the taxable year ended December 31, 1997
and at the Effective Time, a "Qualified Dividend Recipient" (as
those terms are defined in Connecticut Public Act 97-119, 1997
Ct. ALS 119, 1997 Ct. P.A. 119, 1997 Ct. SB 1205). As of De-
cember 31, 1997, persons (not including Eagle Bank or any per-
son that is a "related person," employee or director of Eagle
Bank) will have outstanding cash capital contributions to Eagle
Funding Corp. that, in the aggregate, exceed 5 percent of the
fair market value of the aggregate "real estate assets," valued
as of December 31, 1997, then held by Eagle Funding Corp. (as
such terms are used in Connecticut Public Act 97-119, 1997 Ct.
ALS 119, 1997 Ct. P.A. 119, 1997 Ct. SB 1205).
3.11 EMPLOYEE PLANS.
(a) Section 3.11(a) of the Eagle Disclosure
Schedule sets forth a true and complete list of each employee
benefit plan (within the meaning of Section 3(3) of the Em-
ployee Retirement Income Security Act of 1974, as amended
("ERISA")), arrangement or agreement that is maintained or
contributed to as of the date of this Agreement, or that has
within the last six years been maintained or contributed to, by
Eagle or any of its Subsidiaries or any other entity which to-
gether with Eagle would be deemed a "single employer" within
the meaning of Section 4001 of ERISA or Code Sections 414(b),
(c), (m) or (o) (an "ERISA Affiliate") or under which Eagle or
any Subsidiary or ERISA Affiliate has any liability (collec-
tively, the "Plans").
(b) Eagle has heretofore made available to Web-
ster true, correct and complete copies of each of the Plans and
all related documents, including but not limited to (i) the
actuarial report for such Plan (if applicable) for the last
year, (ii) the most recent determination letter from the Inter-
nal Revenue Service (if applicable) for such Plan, (iii) the
current summary plan description and any summaries of material
modification, (iv) all annual reports (Form 5500 series) for
each Plan filed for the preceding plan year, (v) all agreements
with fiduciaries and service providers relating to the Plan,
and (vi) all substantive correspondence relating to any such
Plan addressed to or received from the Internal Revenue Ser-
vice, the Department of Labor, the Pension Benefit Guaranty
Corporation or any other governmental agency.
(c) Except as set forth at Section 3.11(c) of
the Eagle Disclosure Schedule, (i) each of the Plans has been
operated and administered in all material respects in compli-
ance with applicable Laws, including but not limited to ERISA
and the Code, (ii) each of the Plans intended to be "qualified"
within the meaning of Section 401(a) of the Code is so quali-
fied, (iii) with respect to each Plan which is subject to Title
IV of ERISA, the present value of accrued benefits under such
Plan, based upon the actuarial assumptions used for funding
purposes in the most recent actuarial report prepared by such
Plan's actuary with respect to such Plan, did not, as of its
latest valuation date, exceed the then current value of the
assets of such Plan allocable to such accrued benefits, and
there has not been a material adverse change in the financial
condition of such Plans, (iv) no Plan provides benefits, in-
cluding, without limitation, death or medical benefits (whether
or not insured), with respect to current or former employees of
Eagle or any Eagle Subsidiary beyond their retirement or other
termination of service, other than (w) coverage mandated by ap-
plicable Law, (x) death benefits or retirement benefits under a
Plan that is an "employee pension plan," as that term is de-
fined in Section 3(2) of ERISA, (y) deferred compensation ben-
efits under a Plan that are accrued as liabilities on the books
of Eagle or any Eagle Subsidiary, or (z) benefits the full cost
of which is borne by the current or former employee (or his
beneficiary), (v) Eagle and its Subsidiaries have reserved the
right to amend, terminate and modify any Plan providing post-
retirement death or medical benefits, (vi) no material li-
ability under Title IV of ERISA has been incurred by Eagle, any
Eagle Subsidiary or any ERISA Affiliate that has not been sat-
isfied in full, and no condition exists that presents a mate-
rial risk to Eagle or any Eagle Subsidiary incurring a material
liability thereunder, (vii) none of Eagle, its Subsidiaries or
any ERISA Affiliate has incurred, and Eagle does not expect
that any such entity will incur, any withdrawal liability with
respect to a "multiemployer pension plan" (as such term is de-
fined in Section 3(37) of ERISA) under Title IV of ERISA, or
any material liability in connection with the termination or
reorganization of a multiemployer pension plan, (viii) all con-
tributions or other amounts payable by Eagle or any Eagle Sub-
sidiary as of the Effective Time with respect to each Plan and
all other liabilities of each such entity with respect to each
Plan in respect of current or prior plan years have been paid
or accrued in accordance with generally accepted accounting
practices and Section 412 of the Code, (ix) neither Eagle nor
any Eagle Subsidiary has engaged in a transaction in connection
with which Eagle or any Eagle Subsidiary is subject to either a
material civil penalty assessed pursuant to Section 409 or
502(i) of ERISA or a material tax imposed pursuant to Section
4975 or 4976 of the Code, (x) to the knowledge of Eagle, there
are no pending, threatened or anticipated claims (other than
routine claims for benefits) by, on behalf of or against any of
the Plans or any trusts related thereto, (xi) no Plan, program,
agreement or other arrangement, either individually or collec-
tively, provides for any payment by Eagle or any Eagle Subsid-
iary that would not be deductible under Code Sections
162(a)(1), 162(m) or 404 or that would constitute a "parachute
payment" within the meaning of Code Section 280G, nor is there
outstanding under any such Plan, program, agreement or arrange-
ment, any limited stock appreciation right or any similar right
or instrument that could reasonably be expected to prevent the
Merger from being accounted for as a pooling-of-interests,
(xii) no "accumulated funding deficiency," as defined in Sec-
tion 302(a)(2) of ERISA or Section 412 of the Code, whether or
not waived, and no "unfunded current liability," as determined
under Section 412(l) of the Code, exists with respect to any
Plan, and (xiii) no Plan has experienced a "reportable event"
(as such term is defined in Section 4043(c) of ERISA) that is
not subject to an administrative or statutory waiver from the
reporting requirement.
3.12 CERTAIN CONTRACTS.
(a) Except as set forth at Section 3.12 of the
Eagle Disclosure Schedule, neither Eagle nor any of its Subsid-
iaries is a party to or bound by any contract, arrangement or
commitment (i) with respect to the employment of any directors,
officers, employees or consultants, (ii) which, upon the con-
summation of the transactions contemplated by this Agreement or
the Bank Merger Agreement will (either alone or upon the occur-
rence of any additional acts or events) result in any payment
(whether of severance pay or otherwise) becoming due from Web-
ster, Eagle, Eagle Bank, Xxxxxxx Bank or any of their respec-
tive Subsidiaries to any director, officer or employee thereof,
(iii) which materially restricts the conduct of any line of
business by Eagle or Eagle Bank or of any current or future
affiliates thereof, (iv) with or to a labor union or guild (in-
cluding any collective bargaining agreement), (v) (including
any stock option plan, stock appreciation rights plan, re-
stricted stock plan or stock purchase plan) any of the benefits
of which will be increased, or the vesting of the benefits of
which will be accelerated, by the occurrence of any of the
transactions contemplated by this Agreement or the Bank Merger
Agreement, or the value of any of the benefits of which will be
calculated on the basis of any of the transactions contemplated
by this Agreement or the Bank Merger Agreement, (vi) that is
material and is not made in the ordinary course of business or
pursuant to which Eagle or any of its Subsidiaries is or may
become obligated to invest in or contribute capital to any
Eagle Subsidiaries, (vii) not fully disclosed in the financial
statements contemplated by Section 3.6 that relates to borrow-
ings of money (or guarantees thereof by Eagle, or any Eagle
Subsidiary), other than in the ordinary course of business, or
(viii) is a lease or similar arrangement with annual rental
payments of $100,000 or more. Eagle has previously delivered
or made available to Xxxxxxx true, correct and complete copies
of all employment, consulting and deferred compensation agree-
ments to which Eagle or any of its Subsidiaries is a party.
Section 3.12(a) of the Eagle Disclosure Schedule sets forth a
list of all material contracts (as defined in Item 601(b)(10)
of Regulation S-K) of Eagle. Each contract, arrangement or
commitment of the type described in this Section 3.12(a),
whether or not set forth in Section 3.12(a) of the Eagle Dis-
closure Schedule, is referred to herein as a "Eagle Contract,"
and neither Eagle nor any of its Subsidiaries has received no-
xxxx of, nor do any executive officers of such entities know
of, any violation or imminent violation of any Eagle Contract
by any other party thereto.
(b) (i) Each Eagle Contract is valid and bind-
ing and in full force and effect, (ii) Eagle and each of its
Subsidiaries has in all material respects performed all obliga-
tions required to be performed by it to date under each Eagle
Contract, and (iii) no event or condition exists which consti-
tutes or, after notice or lapse of time or both, would consti-
tute, a material default on the part of Eagle or any of its
Subsidiaries under any such Eagle Contract.
3.13 AGREEMENTS WITH REGULATORY AGENCIES.
Neither Eagle nor Eagle Bank is subject to any cease-
and-desist or other order issued by, or is a party to any writ-
ten agreement, consent agreement or memorandum of understanding
with, or is a party to any commitment letter or similar under-
taking to, or is subject to any order or directive by, or has
been a recipient of any extraordinary supervisory letter from,
or has adopted any board resolutions at the request of (each,
whether or not set forth on Section 3.13 of the Eagle Disclo-
sure Schedule, a "Regulatory Agreement"), any Governmental En-
tity that restricts the conduct of its business or that in any
manner relates to its capital adequacy, its credit policies,
its management or its business, nor has Eagle or Eagle Bank
been advised by any Governmental Entity that it is considering
issuing or requesting any Regulatory Agreement.
3.14 STATE TAKEOVER LAWS; CERTIFICATE OF
INCORPORATION.
The Board of Directors of Eagle has approved the of-
fer of Xxxxxxx to enter into this Agreement, the Bank Merger
Agreement and the Option Agreement, and has approved Eagle's
entering into this Agreement, the Bank Merger Agreement and the
Option Agreement, and the transactions contemplated thereby,
such that under the DGCL (including, without limitation, Sec-
tion 203 thereof) and Eagle's Restated Certificate of Incorpo-
ration (including, without limitation, Articles 10, 12, and 13
thereof) the only vote of Eagle stockholders necessary to con-
summate the transactions contemplated hereby (including the
Bank Merger and, subject to any additional vote of Eagle stock-
holders required pursuant to Article 13 of the Eagle Restated
Certificate of Incorporation, the transactions contemplated by
the Option Agreement) is the approval of the holders of at
least a majority of the outstanding Eagle Common Stock entitled
to vote thereon at the Eagle Meeting or any adjournment or
postponement thereof.
3.15 ENVIRONMENTAL MATTERS.
(a) Each of Eagle and the Eagle Subsidiaries is
in compliance in all material respects with all applicable fed-
eral and state laws and regulations relating to pollution or
protection of the environment (including without limitation,
laws and regulations relating to emissions, discharges, re-
leases and threatened releases of Hazardous Material (as here-
inafter defined)), or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials;
(b) There is no suit, claim, action, proceed-
ing, investigation or notice pending or to the knowledge of
Eagle's and Eagle Bank's executive officers threatened (or to
the knowledge of Eagle's and Eagle Bank's executive officers
past or present actions or events that could reasonably be ex-
pected to form the basis of any such suit, claim, action, pro-
ceeding, investigation or notice), in which Eagle or any Eagle
Subsidiary has been or, with respect to threatened suits,
claims, actions, proceedings, investigations or notices may be,
named as a defendant (x) for alleged material noncompliance
(including by any predecessor), with any environmental law,
rule or regulation or (y) relating to any material release or
threatened release into the environment of any Hazardous Mate-
rial, whether or not occurring at or on a site owned, leased or
operated (directly or indirectly in a fiduciary capacity) by
Eagle or any Eagle Subsidiary;
(c) To the knowledge of Eagle's and Eagle
Bank's executive officers, there has not been any release of
Hazardous Materials in, on, under or affecting any such prop-
erty;
(d) To the knowledge of Eagle's and Eagle
Bank's executive officers, neither Eagle nor any Eagle Subsid-
iary has made or participated in any loan to any person who is
subject to any suit, claim, action, proceeding, investigation
or notice, pending or threatened, with respect to (i) any al-
leged material noncompliance as to any property securing such
loan with any environmental law, rule or regulation, or (ii)
the release or the threatened release into the environment of
any Hazardous Material at any property securing such loan.
(e) For purposes of this section 3.15, the term
"Hazardous Material" means any hazardous waste, petroleum prod-
uct, polychlorinated biphenyl, chemical, pollutant, contami-
nant, pesticide, radioactive substance, lead paint or other
toxic material, or other material or substance (in each such
case, other than small quantities of such substances in retail
containers) regulated under any applicable environmental or
public health statute, law, ordinance, rule or regulation.
3.16 RESERVES FOR LOSSES.
All reserves or other allowances for possible losses
reflected in Eagle's most recent financial statements referred
to in Section 3.6 complied with all Laws and are adequate under
GAAP. Neither Eagle nor Eagle Bank has been notified by the
OTS, the FDIC, any other regulatory authority or by Eagle's
independent auditor, in writing or otherwise, that such re-
serves are inadequate or that the practices and policies of
Eagle or Eagle Bank in establishing such reserves and in ac-
counting for delinquent and classified assets generally fail to
comply with applicable accounting or regulatory requirements,
or that the OTS, the FDIC, any other regulatory authority or
Eagle's independent auditor believes such reserves to be inad-
equate or inconsistent with the historical loss experience of
Eagle or Eagle Bank. Eagle has previously furnished or made
available to Xxxxxxx a complete list of all extensions of cred-
it and other real estate owned ("OREO") that have been classi-
fied by any bank examiner (regulatory or internal) as other
loans specially mentioned, special mention, substandard, doubt-
ful, loss, classified or criticized, credit risk assets, con-
cerned loans or words of similar import. All OREO held by Eag-
le or Eagle Bank is being carried net of reserves at the lower
of cost or net realizable value.
3.17 PROPERTIES AND ASSETS.
Section 3.17 of the Eagle Disclosure Schedule lists
as of the date of this Agreement (i) all real property owned by
Eagle and each Eagle Subsidiary; (ii) each real property lease,
sublease or installment purchase arrangement to which Eagle or
any Eagle Subsidiary is a party; (iii) a description of each
contract for the purchase, sale, or development of real estate
to which Eagle or any Eagle Subsidiary is a party; and (iv) all
items of Eagle's or any Eagle Subsidiary's tangible personal
property and equipment with a book value of $50,000 or more or
having any annual lease payment of $25,000 or more. Except for
(a) items reflected in Eagle's consolidated financial stat-
ements as of June 30, 1997 referred to in Section 3.6 hereof,
(b) exceptions to title that do not interfere materially with
Eagle's or any Eagle Subsidiary's use and enjoyment of owned or
leased real property (other than OREO), (c) liens for current
real estate taxes not yet delinquent, or being contested in
good faith, properly reserved against, (d) properties and as-
sets sold or transferred in the ordinary course of business
consistent with past practices since June 30, 1997, and (e)
items listed in Section 3.17 of the Eagle Disclosure Schedule,
Eagle and each Eagle Subsidiary have good and, as to owned real
property, marketable and insurable title to all their proper-
ties and assets, reflected in the consolidated financial state-
ments of Eagle as of June 30, 1997, free and clear of all
liens, claims, charges and other encumbrances. Eagle and each
Eagle Subsidiary, as lessees, have the right under valid and
subsisting leases to occupy, use and possess all property leas-
ed by them. All properties and assets used by Eagle and each
Eagle Subsidiary are in good operating condition and repair
(subject to ordinary wear and tear) suitable for the purposes
for which they are currently utilized and comply in all mate-
rial respects with all Laws relating thereto now in effect.
Eagle and each Eagle Subsidiary enjoy peaceful and undisturbed
possession under all leases for the use of all property under
which they are the lessees, and all leases to which Eagle or
any Eagle Subsidiary is a party are valid and binding obliga-
tions in accordance with the terms thereof. Neither Eagle nor
any Eagle Subsidiary is in material default with respect to any
such lease, and there has occurred no default by Eagle or Eagle
Bank or event which with the lapse of time or the giving of
notice, or both, would constitute a material default under any
such lease. There are no Laws, conditions of record, or other
impediments which interfere with the intended use by Eagle or
any Eagle Subsidiary of any of the property owned, leased, or
occupied by them.
3.18 INSURANCE.
Notwithstanding anything to the contrary in Article
II-A, Section 3.18 of the Eagle Disclosure Schedule contains a
true, correct and complete list of all insurance policies and
bonds maintained by Eagle and any Eagle Subsidiary, including
the name of the insurer, the policy number, the type of policy
and any applicable deductibles. The existing insurance carried
by Eagle and Eagle Subsidiaries is and will continue to be, in
respect of the nature of the risks insured against and the
amount of coverage provided, substantially similar in kind and
amount to that customarily carried by parties similarly situ-
ated who own properties and engage in businesses substantially
similar to that of Eagle and the Eagle Subsidiaries, and is
sufficient for compliance by Eagle and the Eagle Subsidiaries
with all requirements of Law and agreements to which Eagle or
any of the Eagle Subsidiaries is subject or is party. True,
correct and complete copies of all such policies and bonds re-
flected at Section 3.18 of the Eagle Disclosure Schedule, as in
effect on the date hereof, have been delivered or made avail-
able to Xxxxxxx.
3.19 COMPLIANCE WITH APPLICABLE LAWS.
Each of Eagle and any Eagle Subsidiary has complied
in all material respects with all Laws applicable to it or to
the operation of its business. Neither Eagle nor any Eagle
Subsidiary has received any notice of any material alleged or
threatened claim, violation, or liability under any such Laws
that has not heretofore been cured and for which there is no
remaining liability.
3.20 LOANS.
As of the date hereof:
(a) All loans owned by Eagle or any Eagle Sub-
sidiary, or in which Eagle or any Eagle Subsidiary has an in-
terest, comply in all material respects with all Laws, includ-
ing, but not limited to, applicable usury statutes, underwrit-
ing and recordkeeping requirements and the Truth in Lending
Act, the Equal Credit Opportunity Act and the Real Estate Pro-
cedures Act, and other applicable consumer protection statutes
and the regulations thereunder.
(b) All loans owned by Eagle or any Eagle Sub-
sidiary, or in which Eagle or any Eagle Subsidiary has an in-
terest, have been made or acquired by Eagle in all material
respects in accordance with board of director-approved loan
policies. Each of Eagle and each Eagle Subsidiary holds mort-
gages contained in its loan portfolio for its own benefit to
the extent of its interest shown therein; such mortgages evi-
dence liens having the priority indicated by their terms, sub-
ject, as of the date of recordation or filing of applicable
security instruments, only to such exceptions as are discussed
in attorneys' opinions regarding title or in title insurance
policies in the mortgage files relating to the loans secured by
real property or are not material as to the collectability of
such loans; and all loans owned by Eagle and each Eagle Sub-
sidiary are with full recourse to the borrowers, and each of
Eagle and any Eagle Subsidiary has taken no action which would
result in a waiver or negation of any rights or remedies avail-
able against the borrower or guarantor, if any, on any loan,
other than in the ordinary course of business. All applicable
remedies against all borrowers and guarantors are enforceable
except as may be limited by bankruptcy, insolvency, moratorium
or other similar laws affecting creditors' rights and except as
may be limited by the exercise of judicial discretion in apply-
ing principles of equity. Except as set forth at Section
3.20(b) of the Eagle Disclosure Schedule, all loans purchased
or originated by Eagle or any Eagle Subsidiary and subsequently
sold by Eagle or any Eagle Subsidiary have been sold without
recourse to Eagle or any Eagle Subsidiary and without any lia-
bility under any yield maintenance or similar obligation.
True, correct and complete copies of loan delinquency reports
as of September 30, 1997 prepared by Eagle and each Eagle Sub-
sidiary, which reports include all loans delinquent or other-
wise in default, have been furnished or made available to Web-
ster. True, correct and complete copies of the currently ef-
fective lending policies and practices of Eagle and each Eagle
Subsidiary also have been furnished or made available to Web-
ster.
(c) Except as set forth in Section 3.20(c) of
the Eagle Disclosure Schedule, each outstanding loan participa-
tion sold by Eagle or any Eagle Subsidiary was sold with the
risk of non-payment of all or any portion of that underlying
loan to be shared by each participant (including Eagle or any
Eagle Subsidiary) proportionately to the share of such loan
represented by such participation without any recourse of such
other lender or participant to Eagle or any Eagle Subsidiary
for payment or repurchase of the amount of such loan repre-
sented by the participation or liability under any yield main-
tenance or similar obligation. Eagle and any Eagle Subsidiary
have properly fulfilled in all material respects its contrac-
tual responsibilities and duties in any loan in which it acts
as the lead lender or servicer and has complied in all material
respects with its duties as required under applicable regula-
tory requirements.
(d) Eagle and each Eagle Subsidiary have prop-
erly perfected or caused to be properly perfected all security
interests, liens, or other interests in any collateral securing
any loans made by it.
3.21 OWNERSHIP OF XXXXXXX COMMON STOCK.
Except as set forth at Section 3.21 of the Eagle Dis-
closure Schedule, neither Eagle nor any of its directors, of-
ficers, 10% or greater stockholders or affiliates (i) benefi-
cially own, directly or indirectly, or (ii) is a party to any
agreement, arrangement or understanding for the purpose of ac-
xxxxxxx, holding, voting or disposing of, in each case, any
shares of outstanding capital stock of Xxxxxxx (other than
those agreements, arrangements or understandings specifically
contemplated hereby).
3.22 EAGLE DRIP.
Eagle has suspended the Eagle DRIP such that from the
date hereof, no issuances or purchases of Eagle Common Stock
under the Eagle DRIP shall be permitted, nor shall any other
obligations thereunder accrue.
3.23 FAIRNESS OPINION.
Eagle has received an opinion from Sandler X'Xxxxx to
the effect that, in its opinion, the Exchange Ratio pursuant to
this Agreement is fair to the holders of Eagle Common Stock
from a financial point of view.
3.24 TAX AND ACCOUNTING TREATMENT OF MERGER.
As of the date of this Agreement, Eagle is not aware
of any fact or state of affairs that could cause the Merger not
to be treated as a "reorganization" under Section 368(a) of the
Code or to qualify for "pooling-of-interests" accounting treat-
ment.
3.25 RIGHTS AGREEMENT.
Subject to the execution of an amendment to the Eagle
Rights Agreement which has been approved by Eagle's Board of
Directors and shall be executed promptly after the date of this
Agreement, Eagle has taken or will take all action (including,
if required, redeeming all of the outstanding Eagle Rights is-
sued pursuant to the Eagle Rights Agreement or amending or ter-
minating the Eagle Rights Agreement) so that the entering into
of this Agreement and the Option Agreement and the consummation
of the transactions contemplated hereby and thereby do not and
will not result in the grant of any rights to any person under
the Eagle Rights Agreement or enable or require the Eagle
Rights to be exercised, distributed or triggered.
3.26 EAGLE INFORMATION.
The information relating to Eagle and its Subsidiar-
ies to be provided by Eagle to be contained in the Joint Proxy
Statement/Prospectus and the Registration Statement will not
contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein,
in light of the circumstances in which they are made, not mis-
leading. The Joint Proxy Statement/Prospectus (except for such
portions thereof that relate only to Xxxxxxx or any of its Sub-
sidiaries) will comply in all material respects with the provi-
sions of the Exchange Act and the rules and regulations there-
under.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF XXXXXXX
Xxxxxxx, on behalf of itself and Xxxxxxx Bank, hereby
makes the following representations and warranties to Eagle as
set forth in this Article IV, each of which is being relied
upon by Eagle as a material inducement to enter into and per-
form this Agreement.
4.1 CORPORATE ORGANIZATION.
(a) Xxxxxxx is a corporation duly organized,
validly existing and in good standing under the laws of the
State of Delaware. Xxxxxxx has the corporate power and author-
ity to own or lease all of its properties and assets and to
carry on its business as it is now being conducted, and is duly
licensed or qualified to do business in each jurisdiction in
which the nature of the business conducted by it or the charac-
ter or location of the properties and assets owned or leased by
it makes such licensing or qualification necessary. Xxxxxxx is
duly registered as a savings and loan holding company with the
OTS under HOLA. The Restated Certificate of Incorporation and
By-Laws of Xxxxxxx, copies of which have previously been made
available to Eagle, are true, correct and complete copies of
such documents as in effect as of the date of this Agreement.
(b) Xxxxxxx Bank is a federal savings bank
chartered by the OTS under the laws of the United States with
its main office in the State of Connecticut. Xxxxxxx Bank has
the corporate power and authority to own or lease all of its
properties and assets and to carry on business as is now being
conducted, and is duly licensed or qualified to do business in
each jurisdiction in which the nature of the business conducted
by it or the character or location of the properties and assets
owned or leased by it makes such licensing or qualification
necessary. The Charter and By-Laws of Xxxxxxx Bank, copies of
which have previously been made available to Eagle, are true,
correct and complete copies of such documents as in effect as
of the date of this Agreement.
4.2 CAPITALIZATION.
(a) The authorized capital stock of Xxxxxxx as
of the date hereof consists of 30,000,000 shares of Xxxxxxx
Common Stock, of which 13,554,224 shares were outstanding (net
of 83,639 treasury shares) at September 30, 1997 and 3,000,000
shares of serial preferred stock, par value $.01 per share
("Xxxxxxx Preferred Stock"), 14,000 of which are designated as
Series C Preferred Stock, none of which were outstanding at
September 30, 1997. At such date, there were options outstand-
ing to purchase 754,744 shares of Xxxxxxx Common Stock. All of
the issued and outstanding shares of Xxxxxxx Common Stock have
been duly authorized and validly issued and are fully paid,
nonassessable and free of preemptive rights, with no personal
liability attaching to the ownership thereof. As of the date
of this Agreement, except as set forth above, Xxxxxxx does not
have and is not bound by any outstanding subscriptions, op-
tions, warrants, calls, commitments or agreements of any char-
acter calling for the purchase or issuance of any shares of
Xxxxxxx Common Stock or Xxxxxxx Preferred Stock or any other
equity securities of Xxxxxxx or any securities representing the
right to purchase or otherwise receive any shares of Xxxxxxx
Common Stock or Xxxxxxx Preferred Stock, other than (i) a war-
rant to purchase 300,000 shares of Xxxxxxx Common Stock issued
to Fleet Financial Group and a contingent payment arrangement
with Fleet Financial Group as described in the Form 8-K filed
by Xxxxxxx with the Securities and Exchange Commission for such
event, (ii) pursuant to that certain Rights Agreement between
Xxxxxxx and American Stock Transfer & Trust Co and (iii) pursu-
ant to that certain Escrow Agreement between Xxxxxxx, American
Stock Transfer & Trust Co., as Escrow Agent, and certain former
shareholders of Sachem Trust National Association. The shares
of Xxxxxxx Common Stock to be issued pursuant to the Merger are
duly authorized and, at the Effective Time, all such shares
will be validly issued, fully paid, nonassessable and free of
preemptive rights, with no personal liability attaching to the
ownership thereof.
(b) The authorized capital stock of Xxxxxxx
Bank consists of 2,000 shares of common stock, par value $.01
per share, 1,000 of which are issued and outstanding, and 1,000
shares of preferred stock, par value $.01 per share, none of
which is issued or outstanding. The outstanding shares of com-
mon stock of Xxxxxxx Bank are owned by Xxxxxxx free and clear
of all liens, charges, encumbrances and security interests
whatsoever, and all of such shares are duly authorized and val-
idly issued and fully paid, nonassessable and free of preemp-
tive rights, with no personal liability attaching to ownership
thereof.
4.3 AUTHORITY; NO VIOLATION.
(a) Xxxxxxx has full corporate power and au-
thority to execute and deliver this Agreement and the Option
Agreement and to consummate the transactions contemplated here-
by and thereby. The execution and delivery of this Agreement
and the Option Agreement and the consummation of the transac-
tions contemplated hereby and thereby have been duly and val-
idly approved by the Board of Directors of Xxxxxxx. Except for
the adoption and approval of this Agreement by the requisite
vote of the Xxxxxxx stockholders, no other corporate proceed-
ings on the part of Xxxxxxx are necessary to consummate the
transactions contemplated hereby. This Agreement has been, and
the Option Agreement will be, duly and validly executed and
delivered by Xxxxxxx and (assuming due authorization, execution
and delivery by Eagle) this Agreement constitutes a valid and
binding obligation of Xxxxxxx, enforceable against Xxxxxxx in
accordance with its terms, except as enforcement may be limited
by general principles of equity whether applied in a court of
law or a court of equity and by bankruptcy, insolvency and sim-
ilar law affecting creditors' rights and remedies generally.
(b) Xxxxxxx Bank has full corporate power and
authority to execute and deliver the Bank Merger Agreement and
to consummate the transactions contemplated thereby. The ex-
ecution and delivery of the Bank Merger Agreement and the con-
summation of the transactions contemplated thereby will be duly
and validly approved by the Board of Directors of Xxxxxxx Bank,
and by Xxxxxxx as the sole stockholder of Xxxxxxx Bank prior to
the Effective Time. All corporate proceedings on the part of
Xxxxxxx Bank necessary to consummate the transactions contem-
plated thereby will have been taken prior to the Effective
Time. The Bank Merger Agreement, upon execution and delivery
by Xxxxxxx Bank, will be duly and validly executed and deliv-
ered by Xxxxxxx Bank and will (assuming due authorization, ex-
ecution and delivery by Eagle Bank) constitute a valid and
binding obligation of Xxxxxxx Bank, enforceable against Xxxxxxx
Bank in accordance with its terms, except as enforcement may be
limited by general principles of equity whether applied in a
court of law or a court of equity and by bankruptcy, insolvency
and similar laws affecting creditors' rights and remedies gen-
erally.
(c) Neither the execution and delivery of this
Agreement or the Option Agreement by Xxxxxxx or the Bank Merger
Agreement by Xxxxxxx Bank, nor the consummation by Xxxxxxx or
Xxxxxxx Bank, as the case may be, of the transactions contem-
plated hereby or thereby, nor compliance by Xxxxxxx or Xxxxxxx
Bank, as the case may be, with any of the terms or provisions
hereof or thereof, will (i) violate any provision of the Re-
stated Certificate of Incorporation or Bylaws of Xxxxxxx or the
Charter or By-Laws of Xxxxxxx Bank, as the case may be, or (ii)
assuming that the consents and approvals referred to in Section
4.4 are duly obtained, (x) violate any Laws applicable to Web-
ster or Xxxxxxx Bank or any of their respective properties or
assets, or (y) violate, conflict with, result in a breach of
any provision of or the loss of any benefit under, constitute a
default (or an event which, with notice or lapse of time, or
both, would constitute a default) under, result in the termina-
tion of or a right of termination or cancellation under, ac-
celerate the performance required by, or result in the creation
of any lien, pledge, security interest, charge or other encum-
brance upon any of the respective properties or assets of Web-
ster or Xxxxxxx Bank under any of the terms, conditions or pro-
visions of any note, bond, mortgage, indenture, deed of trust,
license, lease, agreement or other instrument or obligation to
which Xxxxxxx or Xxxxxxx Bank is a party, or by which they or
any of their respective properties or assets may be bound or
affected.
4.4 REGULATORY APPROVALS.
(a) Except for (i) the filing of applications
and notices, as applicable, as to the Merger and the Bank Merg-
er with the OTS under HOLA and the Bank Merger Act and approval
of such applications and notices, (ii) the filing with the SEC
of a registration statement on Form S-4 to register the shares
of Xxxxxxx Common Stock to be issued in connection with the
Merger (including the shares of Xxxxxxx Common Stock that may
be issued upon the exercise of the options referred to in Sec-
tion 1.6 hereof), which will include the Joint Proxy Statement/
Prospectus, (iii) the approval of this Agreement by the requi-
site vote of the stockholders of Eagle and the requisite ap-
proval, if any, of Eagle stockholders in connection with the
Option Agreement pursuant to the Eagle Restated Certificate of
Incorporation, (iv) the approval of this Agreement by the req-
uisite vote of the stockholders of Xxxxxxx, (v) the filing of
the Certificate of Merger with the Secretary of State of Dela-
ware pursuant to the DGCL, (vi) the filings in connection with
the Bank Merger Agreement and the transactions contemplated
thereby and (vii) such filings and approvals as are required to
be made or obtained under the securities or "Blue Sky" laws of
various states or with Nasdaq (or such other exchange as may be
applicable) in connection with the issuance of the shares of
Xxxxxxx Common Stock pursuant to this Agreement, no consents or
approvals of or filings or registrations with any Governmental
Entity are necessary in connection with (1) the execution and
delivery by Xxxxxxx of this Agreement and the Option Agreement,
(2) the performance by Xxxxxxx of this Agreement and the trans-
actions contemplated hereby, (3) the execution and delivery by
Xxxxxxx Bank of the Bank Merger Agreement, and (4) the con-
summation by Xxxxxxx Bank of the transactions contemplated by
the Bank Merger Agreement except for such consents, approvals
or filings the failure of which to obtain will not have a mate-
rial adverse effect on the ability of Eagle to consummate the
transactions contemplated thereby.
(b) Xxxxxxx hereby represents to Eagle that, as
of the date of this Agreement, it has no knowledge of any rea-
son why approval or effectiveness of any of the applications,
notices or filings referred to in Section 4.4(a) cannot be ob-
tained or granted on a timely basis.
(c) Xxxxxxx and Xxxxxxx Bank have timely filed
all reports, registrations and statements, together with any
amendments required to be made with respect thereto, that they
were required to file since December 31, 1993, with any Regula-
tory Agencies. As of its respective date, each such report,
registration, statement and amendment complied in all material
respects with all rules and regulations promulgated by the ap-
plicable Regulatory Agency and did not contain any untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which
they were made, not misleading. Except for normal examinations
conducted by a Regulatory Agency in the regular course of the
business of Xxxxxxx and its Subsidiaries, no Governmental En-
tity is conducting, or has conducted, any proceeding or inves-
tigation into the business or operations of Xxxxxxx since De-
cember 31, 1993.
4.5 FINANCIAL STATEMENTS; EXCHANGE ACT FILINGS;
BOOKS AND RECORDS.
Xxxxxxx has previously delivered to Eagle true, cor-
rect and complete copies of (i) the audited consolidated state-
ments of condition of Xxxxxxx and its Subsidiaries as of Decem-
ber 31 for the fiscal years 1995 and 1996 and the related au-
dited consolidated statements of income, changes in sharehold-
ers' equity and cash flows for the fiscal years 1994 through
1996, inclusive, as reported in Xxxxxxx'x Annual Report on Form
10-K for the fiscal year ended December 31, 1996 filed with the
SEC under the Exchange Act, in each case accompanied by the
audit report of KPMG Peat Marwick LLP, independent public ac-
countants with respect to Xxxxxxx; and (ii) the unaudited con-
solidated statements of condition of Xxxxxxx and its Subsidiar-
ies as of June 30, 1997 and 1996 and the related unaudited con-
solidated statements of income, changes in shareholders' equity
and cash flows for the interim periods ended June 30, 1997 and
1996, as reported on Xxxxxxx'x Quarterly Report on Form 10-Q
for the period ended June 30, 1997 filed with the SEC under the
Exchange Act. The financial statements referred to in this
Section 4.5 (including the related notes, where applicable)
fairly present, and the financial statements referred to in
Section 6.8 hereof will fairly present (subject, in the case of
the unaudited statements, to recurring audit adjustments normal
in nature and amount), the results of the consolidated opera-
tions and consolidated financial condition of Xxxxxxx and its
Subsidiaries for the respective fiscal periods or as of the
respective dates therein set forth; each of such statements
(including the related notes, where applicable) comply, and the
financial statements referred to in Section 6.8 hereof will
comply, with applicable accounting requirements and with the
published rules and regulations of the SEC with respect there-
to; and each of such statements (including the related notes,
where applicable) has been, and the financial statements re-
ferred to in Section 6.8 hereof will be, prepared in accordance
with GAAP consistently applied during the periods involved,
except as indicated in the notes thereto or, in the case of
unaudited statements, as permitted by Form 10-X. Xxxxxxx'x
Annual Report on Form 10-K for the fiscal year ended December
31, 1996 and all subsequently filed reports under Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act comply in all
material respects with the appropriate requirements for such
reports under the Exchange Act, and Xxxxxxx has previously de-
livered or made available to Eagle true, correct and complete
copies of such reports. The books and records of Xxxxxxx and
Xxxxxxx Bank have been, and are being, maintained in all mate-
rial respects in accordance with GAAP and any other applicable
legal and accounting requirements and reflect only actual
transactions.
4.6 ABSENCE OF CERTAIN CHANGES OR EVENTS.
(a) Except as disclosed in Xxxxxxx'x Annual Report
on Form 10-K for the fiscal year ended December 31, 1996 and
all reports subsequently filed by Xxxxxxx under Sections 13(a),
13(e), 14 or 15(d) of the Exchange Act, true, correct and com-
plete copies of which have previously been delivered or made
available to Eagle, since December 31, 1996, no event has oc-
curred which has had, individually or in the aggregate, a Mate-
rial Adverse Effect on Xxxxxxx.
(b) Since September 30, 1996, Xxxxxxx and its Sub-
sidiaries have carried on their respective businesses in the
ordinary and usual course consistent with their past practices.
4.7 COMPLIANCE WITH APPLICABLE LAW.
Xxxxxxx and each Xxxxxxx Subsidiary has complied in
all material respects with all Laws applicable to it or to the
operation of its business. Neither Xxxxxxx nor any Xxxxxxx
Subsidiary has received any notice of any alleged or threatened
claim, violation of or liability or potential responsibility
under any such Laws that has not heretofore been cured and for
which there is no remaining liability.
4.8 OWNERSHIP OF EAGLE COMMON STOCK;
AFFILIATES AND ASSOCIATES.
(a) Except for this Agreement, neither Xxxxxxx
nor any of its affiliates or associates (as such terms are de-
fined under the Exchange Act), (i) beneficially own, directly
or indirectly, or (ii) is a party to any agreement, arrangement
or understanding for the purpose of acquiring, holding, voting
or disposing of, in each case, more than five percent of the
outstanding capital stock of Eagle, excluding the shares of
Eagle Common Stock issuable pursuant to the Option Agreement to
be executed subsequent to the execution of the Agreement.
4.9 EMPLOYEE BENEFIT PLANS.
Xxxxxxx has heretofore made available for inspection,
or delivered (if requested) to Eagle true, correct and complete
copies of each employee benefit plan arrangement or agreement
that is maintained as of the date of this Agreement (the "Web-
ster Plans") by Xxxxxxx or any of its Subsidiaries. No "ac-
cumulated funding deficiency" as defined in Section 302(a)(2)
of ERISA or Section 412 of the Code, whether or not waived, and
no "unfunded current liability" as determined under Section
412(l) of the Code exists with respect to any Xxxxxxx Plan.
The Xxxxxxx Plans are in compliance in all material respects
with the applicable requirements of ERISA and the Code.
4.10 AGREEMENTS WITH REGULATORY AGENCIES.
Neither Xxxxxxx nor any of its affiliates is subject
to any cease-and-desist or other order issued by, or is a party
to any written agreement, consent agreement or memorandum of
understanding with, or is a party to any commitment letter or
similar undertaking to, or is subject to any order or directive
by, or has been a recipient of any extraordinary supervisory
letter from, or has adopted any board resolutions at the re-
quest of (each, whether or not set forth on Section 4.10 of the
Xxxxxxx Disclosure Schedule, a "Regulatory Agreement"), any
Governmental Entity that restricts the conduct of its business
or that in any manner relates to its capital adequacy, its
credit policies, its management or its business, nor has Web-
ster or Xxxxxxx Bank been advised by any Governmental Entity
that it is considering issuing or requesting any Regulatory
Agreement.
4.11 TAX AND ACCOUNTING TREATMENT OF MERGER.
As of the date of this Agreement, Xxxxxxx is not
aware of any fact or state of affairs that could cause the
Merger not to be treated as a "reorganization" under Section
368(a) of the Code or to qualify for "pooling-of-interests"
accounting treatment.
4.12 LEGAL PROCEEDINGS.
(a) Neither Xxxxxxx nor any of its Subsidiaries is a
party to any, and there are no pending or threatened, legal,
administrative, arbitration or other proceedings, claims, ac-
tions or governmental or regulatory investigations of any na-
ture against Xxxxxxx or any of its Subsidiaries in which there
is a reasonable probability of any material recovery against or
other material adverse effect upon Xxxxxxx or any of its Sub-
sidiaries or which challenge the validity or propriety of the
transactions contemplated by this Agreement, the Bank Merger
Agreement or the Option Agreement as to which there is a rea-
sonable probability of success.
(b) There is no injunction, order, judgment or xx-
xxxx imposed upon Xxxxxxx, any of its Subsidiaries or the as-
sets of Xxxxxxx or any of its Subsidiaries.
4.13 RESERVES FOR LOSSES.
All reserves or other allowances for possible losses
reflected in Xxxxxxx'x most recent financial statements re-
ferred to in Section 4.5 complied with all Laws and are ad-
equate under GAAP. Neither Xxxxxxx nor Xxxxxxx Bank has been
notified by the OTS, the FDIC, any other regulator authority or
by Xxxxxxx'x independent auditor, in writing or otherwise, that
the reserves or other allowances for possible loan losses re-
flected in Xxxxxxx'x most recent financial statements referred
to in Section 4.5 are inadequate or that the practices and
policies of Xxxxxxx or Xxxxxxx Bank in establishing such re-
serves and in accounting for delinquent and classified assets
generally fail to comply with applicable accounting or regula-
tory requirements or that the OTS, the FDIC, any other regula-
tory authority or Xxxxxxx'x independent auditor believes such
reserves to be inadequate or inconsistent with the historical
loss experience of Xxxxxxx or Xxxxxxx Bank. Xxxxxxx has previ-
ously furnished Eagle with a complete list of all OREO that
have been classified by any bank examiner (regulatory or inter-
nal) as other loans specially mentioned, special mention, sub-
standard, doubtful, loss, classified or criticized, credit risk
assets, concerned loans or words of similar import. All OREO
held by Xxxxxxx or Xxxxxxx Bank is being carried net of re-
serves at the lower of cost or net realizable value.
4.14 BROKER'S FEES.
Neither Xxxxxxx nor any Xxxxxxx Subsidiary nor
any of their respective officers or directors has employed any
broker or finder or incurred any liability for any broker's
fees, commissions or finder's fees in connection with any of
the transactions contemplated by this Agreement, the Bank
Merger Agreement or the Option Agreement, except that Xxxxxxx
has engaged, and will pay a fee or commission to Merrill,
Lynch, Xxxxxx, Xxxxxx & Xxxxx Incorporated ("Xxxxxxx Xxxxx") in
accordance with the terms of a letter agreement between Xxxxxxx
Xxxxx and Xxxxxxx, dated October 21, 1997, a true, complete and
correct copy of which has been previously delivered or made
available by Xxxxxxx to Eagle.
4.15 FAIRNESS OPINION.
Xxxxxxx has received an opinion from Xxxxxxx Xxxxx to
the effect that, in its opinion, the Exchange pursuant to this
Agreement is fair to Xxxxxxx from a financial point of view.
4.16 TAXES.
Each of Xxxxxxx and its Subsidiaries has duly filed
all material Federal, state, local and foreign Tax Returns re-
quired to be filed by it on or prior to the date hereof (all
such returns being accurate and complete in all material re-
spects) and has duly paid or made provisions for the payment of
all material Taxes which have been incurred or are due or
claimed to be due from it by Federal, state, local and foreign
taxing authorities on or prior to the date hereof. All liabil-
ity with respect to the income tax returns of Xxxxxxx and its
Subsidiaries has been satisfied for all years to and including
1996. The Internal Revenue Service ("IRS") has not notified
Xxxxxxx of, or otherwise asserted, that there are any material
deficiencies with respect to the income tax returns of Xxxxxxx.
There are no material disputes pending, or claims asserted for,
Taxes or assessments upon Xxxxxxx or any of its Subsidiaries,
nor has Xxxxxxx or any of its Subsidiaries been requested to
give any waivers extending the statutory period of limitation
applicable to any Federal, state or local income tax return for
any period.
4.17 XXXXXXX INFORMATION.
The information relating to Xxxxxxx and its Subsid-
iaries to be provided by Xxxxxxx to be contained in the Joint
Proxy Statement/Prospectus and the Registration Statement will
not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein,
in light of the circumstances in which they are made, not mis-
leading. The Joint Proxy Statement/Prospectus (except for such
portions thereof that relate only to Eagle or any of its Sub-
sidiaries) will comply in all material respects with the provi-
sions of the Exchange Act and the rules and regulations there-
under. The Registration Statement will comply in all material
respects with the provisions of the Securities Act and the
rules and regulations thereunder.
ARTICLE V
COVENANTS RELATING TO CONDUCT OF BUSINESS
5.1 COVENANTS OF EAGLE.
During the period from the date of this Agreement and
continuing until the Effective Time, except as expressly con-
templated or permitted by this Agreement, the Bank Merger
Agreement or the Option Agreement, or with the prior written
consent of Xxxxxxx, Eagle and each Eagle Subsidiary shall carry
on their respective businesses in the ordinary course consis-
tent with past practices and consistent with prudent banking
practices. Eagle will use its reasonable best efforts to (x)
preserve its business organization and that of each Eagle Sub-
sidiary intact, (y) keep available to itself and Xxxxxxx the
present services of the employees of Eagle and each Eagle Sub-
sidiary and (z) preserve for itself and Xxxxxxx the goodwill of
the customers of Eagle and each Eagle Subsidiary and others
with whom business relationships exist. Without limiting the
generality of the foregoing, and except as set forth in the
Eagle Disclosure Schedule or as otherwise contemplated by this
Agreement or consented to by Xxxxxxx in writing, Eagle shall
not, and shall not permit any Eagle Subsidiary to:
(a) declare or pay any dividends on, or make
other distributions in respect of, any of its capital stock
(except for the payment of regular quarterly cash dividends by
Eagle of $0.25 per share on the Eagle Common Stock with decla-
ration, record and payment dates corresponding to the quarterly
dividends paid by Eagle during its fiscal year ended September
30, 1996 and except that any Eagle Subsidiary may declare and
pay dividends and distributions to Eagle). Until the Effective
Time, Eagle and Xxxxxxx shall coordinate with the other decla-
ration of any dividends or other distributions with respect to
the Eagle Common Stock and the Xxxxxxx Common Stock and the
record dates and payment dates relating thereto, it being the
intention of the parties that holders of shares of Eagle Common
Stock or Xxxxxxx Common Stock shall not receive more than one
dividend, or fail to receive one dividend, for any single cal-
endar quarter on their shares of Eagle Common Stock (including
any shares of Xxxxxxx Common Stock received in exchange there-
for in the Merger) or Xxxxxxx Stock, as the case may be.
(b) (i) split, combine or reclassify any shares
of its capital stock or issue, authorize or propose the issu-
ance of any other securities in respect of, in lieu of or in
substitution for shares of its capital stock except upon the
exercise or fulfillment of rights or options issued and out-
standing as of the date hereof pursuant to the Eagle Stock
Plans in accordance with their present terms, and except pursu-
ant to the Option Agreement, or (ii) repurchase, redeem or oth-
erwise acquire (except for the acquisition of Trust Account
Shares and DPC Shares, as such terms are defined in Section
1.4(c) hereof) any shares of the capital stock of Eagle or any
Eagle Subsidiary, or any securities convertible into or exer-
cisable for any shares of the capital stock of Eagle or any
Eagle Subsidiary;
(c) issue, deliver or sell, or authorize or
propose the issuance, delivery or sale of, any shares of its
capital stock or any securities convertible into or exercisable
for, or any rights, warrants or options to acquire, any such
shares, or enter into any agreement with respect to any of the
foregoing, other than (i) the issuance of Eagle Common Stock
pursuant to stock options or similar rights to acquire Eagle
Common Stock granted pursuant to the Eagle Stock Plans and out-
standing prior to the date of this Agreement, in each case in
accordance with their present terms and (ii) pursuant to the
Option Agreement;
(d) amend its Restated Certificate of Incorpo-
ration, By-Laws or other similar governing documents;
(e) authorize or permit any of its officers,
directors, employees or agents to, directly or indirectly, so-
licit, initiate or encourage any inquiries relating to, or the
making of any proposal from, hold discussions or negotiations
with or provide any information to, any person, entity or group
(other than Xxxxxxx) concerning any Acquisition Transaction (as
defined below); provided, however, that Eagle may, and may au-
thorize and permit its officers, directors, employees or agents
to, provide or cause to be provided information and may par-
ticipate in such discussions or negotiations if the Board of
Directors of Eagle, after having consulted with and considered
the advice of outside counsel, has determined that the failure
to provide such information or participate in such negotiations
or discussions could cause the members of such Board of Direc-
tors to breach their fiduciary duties under applicable laws.
Eagle shall promptly communicate to Xxxxxxx the material terms
of any proposal, whether written or oral, which it may receive
in respect of any such Acquisition Transaction and whether it
is having discussions or negotiations with a third party about
an Acquisition Transaction or providing information in connec-
tion with, or which may lead to, an Acquisition Transaction
with a third party. Eagle will promptly cease and cause to be
terminated any existing activities, discussions or negotiations
previously conducted with any parties other than Xxxxxxx with
respect to any of the foregoing. As used in this Agreement,
"Acquisition Transaction" shall mean any offer, proposal or
expression of interest relating to (i) any tender or exchange
offer involving Eagle or any Eagle Subsidiary, (ii) merger,
consolidation or other business combination involving Eagle or
any Eagle Subsidiary, or (iii) the acquisition in any manner of
a substantial equity interest in, or a substantial portion of
the assets, out of the ordinary course of business, of, Eagle
or Eagle Bank other than the transactions contemplated or per-
mitted by this Agreement, the Bank Merger Agreement and the
Option Agreement;
(f) make capital expenditures aggregating in
excess of $100,000, other than related to the matters and in no
more than the amounts set forth on Section 5.1(f) of the Eagle
Disclosure Schedule;
(g) enter into any new line of business;
(h) acquire or agree to acquire, by merging or
consolidating with, or by purchasing an equity interest in or
the assets of, or by any other manner, any business or any cor-
poration, partnership, association or other business organiza-
tion or division thereof or otherwise acquire any assets, other
than in connection with foreclosures, settlements in lieu of
foreclosure or troubled loan or debt restructurings, or in the
ordinary course of business consistent with prudent banking
practices;
(i) take any action that is intended or may
reasonably be expected to result in any of its representations
and warranties set forth in this Agreement being or becoming
untrue or in any of the conditions to the Merger set forth in
Article VII not being satisfied, or in a violation of any pro-
vision of this Agreement or the Bank Merger Agreement, except,
in every case, as may be required by applicable Law;
(j) change its methods of accounting in effect
at September 30, 1996 except as required by changes in GAAP or
regulatory accounting principles as concurred to by Eagle's
independent auditors;
(k) (i) except as required by applicable law or
to maintain qualification pursuant to the Code, adopt, amend,
renew (other than through operation of evergreen provisions or
renewals of the agreements set forth in Section 5.1(k) of the
Eagle Disclosure Schedule consistent with past practice) or
terminate any Plan or any agreement, arrangement, plan or poli-
cy between Eagle or any Eagle Subsidiary and one or more of its
current or former directors, officers or employees, (ii) other
than normal annual increases in pay, consistent with past prac-
xxxx, for employees not subject to an employment, change of
control or severance agreement, increase in any manner the com-
pensation of any employee or director or pay any benefit not
required by any Plan or agreement as in effect as of the date
hereof (including, without limitation, the granting of stock
options, stock appreciation rights, restricted stock, re-
stricted stock units or performance units or shares), (iii)
enter into, modify or renew (other than through operation of
evergreen provisions or renewals of the agreements set forth in
Section 5.1(k) of the Eagle Disclosure Schedule consistent with
past practice) any contract, agreement, commitment or arrange-
ment providing for the payment to any director, officer or em-
ployee of compensation or benefits, other than normal annual
increases in pay, consistent with past practice, for employees
not subject to an employment, change of control or severance
agreement, and except for the retention and incentive bonus ar-
rangements described on Section 5.1(k) of the Eagle Disclosure
Schedule, (iv) hire any new employee at an annual compensation
in excess of $30,000, (v) pay expenses of any employees or di-
rectors for attending conventions or similar meetings which
conventions or meetings are held after the date hereof, except
as set forth on Section 5.1(k) of the Eagle Disclosure Sched-
ule, (vi) promote to a rank of vice president or more senior
any employee, or (vii) pay any retention or other bonuses to
any employees except for the retention and incentive bonus ar-
rangements described on Section 5.1(k) of the Eagle Disclosure
Schedule;
(l) incur any indebtedness for borrowed money,
assume, guarantee, endorse or otherwise as an accommodation
become responsible for the obligations of any other individual,
corporation or other entity other than in the ordinary course
of business consistent with past practice;
(m) except as set forth in Section 5.1(m) of
the Eagle Disclosure Schedule, sell, purchase, enter into a
lease, relocate, open or close any banking or other office, or
file an application pertaining to such action with any Govern-
mental Entity;
(n) make any equity investment or commitment to
make such an investment in real estate or in any real estate
development project, other than in connection with foreclosure,
settlements in lieu of foreclosure, or troubled loan or debt
restructuring, in the ordinary course of business consistent
with past banking practices;
(o) make any new loans to, modify the terms of
any existing loan to, or engage in any other transactions
(other than routine banking transactions) with, any Affiliated
Person of Eagle or any Eagle Subsidiary;
(p) make any investment, or incur deposit li-
abilities, other than in the ordinary course of business con-
sistent with past practices, or make any equity investments;
(q) except as set forth in Section 5.1(q) of
the Eagle Disclosure Schedule, purchase any loans or sell, pur-
chase or lease any real property, except for the sale of real
estate that is the subject of a casualty loss or condemnation
or the sale of OREO on a basis consistent with past practices;
(r) originate (i) any loans except in ac-
cordance with existing Eagle Bank lending policies, (ii) unse-
cured consumer loans in excess of $10,000, (iii) commercial
real estate first mortgage or other commercial loans in excess
of $250,000 as to any loan or $500,000 in the aggregate as to
related loans, or loans to related persons, or (iv) land acqui-
sition loans to borrowers who intend to construct a residence
on such land in excess of the lesser of 75% of the appraised
value of such land or $100,000, except in each case for (A)
loans for which written commitments have been issued by Eagle
Bank as of the date hereof, as disclosed in Section 5.1(r) of
the Eagle Disclosure Schedule, (B) renewals of loans existing
as of the date of this Agreement or loans permitted pursuant to
this Section 5.1(r) and (C) increases in the principal amount
of loans existing as of the date of this Agreement, subject to
a limit of 30% of the principal amount of such loans as of the
date of this Agreement or $500,000, whichever is less.
(s) make any investments in any equity or
derivative securities or engage in any forward commitment, fu-
tures transaction, financial options transaction, hedging or
arbitrage transaction or covered asset trading activities or
make any investments in any investment security with a maturity
of greater than one year;
(t) sell or purchase any mortgage loan servic-
ing rights; or
(u) agree or commit to do any of the actions
set forth in clauses (a) - (t) of this Section 5.1.
The consent of Xxxxxxx to any action by Eagle or any Eagle Sub-
sidiary that is not permitted by any of the preceding para-
graphs shall be evidenced only by a writing signed by the Pres-
ident or any Executive Vice President of Xxxxxxx or, in the
case of 5.1(r), the Chief Credit Policy Officer of Xxxxxxx.
5.2 COVENANTS OF XXXXXXX.
During the period from the date of this Agreement and
continuing until the Effective Time, except as expressly con-
templated or permitted by this Agreement or with Eagle's prior
written consent, Xxxxxxx shall not, and shall not permit Web-
ster Bank to:
(a) take any action that will result in any of
Xxxxxxx'x representations and warranties set forth in this
Agreement being or becoming untrue or any of the conditions to
the Merger set forth in Article VII not being satisfied or in a
violation of any provision of this Agreement or the Bank Merger
Agreement, except, in every case, as may be required by appli-
cable Law; or
(b) take any other action that would materially
adversely affect or materially delay the ability of Xxxxxxx to
obtain the Requisite Regulatory Approvals or otherwise materi-
ally adversely affect Xxxxxxx'x and Xxxxxxx Bank's ability to
consummate the transactions contemplated by this Agreement.
5.3 MERGER COVENANTS.
Notwithstanding that Eagle believes that it has es-
tablished all reserves and taken all provisions for possible
loan losses required by GAAP and applicable laws, rules and
regulations, Eagle recognizes that Xxxxxxx may have adopted
different loan, accrual and reserve policies (including loan
classifications and levels of reserves for possible loan loss-
es). In that regard, and in general, from and after the date
of this Agreement to the Effective Time, Eagle and Xxxxxxx
shall consult and cooperate with each other in order to formu-
late the plan of integration for the Merger, including, among
other things, with respect to conforming immediately prior to
the Effective Time, based upon such consultation, Eagle's loan,
accrual and reserve policies to those policies of Xxxxxxx to
the extent consistent with GAAP; provided, that any change in
Eagle's policies in connection with such matters need not be
effected until Xxxxxxx irrevocably agrees in writing that (i)
all conditions to Xxxxxxx'x obligation to consummate the Merger
have been satisfied, (ii) that Xxxxxxx will waive any and all
rights that it may have to terminate this Agreement and (iii)
Xxxxxxx will complete the Merger.
5.4 EMPLOYMENT AND OTHER AGREEMENTS.
Following the Merger, Xxxxxxx agrees that it shall
honor the existing written deferred compensation, employment,
change of control and severance contracts with directors and
employees of Eagle and Eagle Bank that are listed at Section
5.4 of the Eagle Disclosure Schedule; provided, however, that
in making the foregoing agreement, Xxxxxxx will honor such con-
tracts only to the extent that, as represented at Section 3.11
hereof, none of such deferred compensation, employment, change
of control and severance contracts, nor any other Eagle Plan,
program, agreement or other arrangement under which any such
director or employee is a beneficiary, either individually or
collectively, provides for any payment by Eagle or any Eagle
Subsidiary that would not be deductible under Code Sections
162(a)(1) or 404 or that would constitute a "parachute payment"
within the meaning of Code Section 280G. In addition, follow-
ing the Merger, Xxxxxxx agrees that it shall continue to pro-
vide the benefits set forth in Section 5.4-A of the Eagle Dis-
closure Schedule as provided therein.
ARTICLE VI
ADDITIONAL AGREEMENTS
6.1 REGULATORY MATTERS.
(a) Upon the execution and delivery of this
Agreement, Xxxxxxx and Eagle (as to information to be included
therein pertaining to Eagle) shall promptly cause to be pre-
pared and filed with the SEC a registration statement of
Xxxxxxx on Form S-4, including the Joint Proxy Statement/
Prospectus (the "Registration Statement") for the purpose of
registering the Xxxxxxx Common Stock to be issued in the
Merger, and for soliciting the adoption and approval of this
Agreement and the Merger by the stockholders of Eagle and Web-
ster. Xxxxxxx and Eagle shall use their reasonable best ef-
forts to have the Registration Statement declared effective by
the SEC as soon as possible after the filing thereof. The par-
ties shall cooperate in responding to and considering any ques-
tions or comments from the SEC staff regarding the information
contained in the Registration Statement. If at any time after
the Registration Statement is filed with the SEC, and prior to
the Closing Date, any event relating to Eagle is discovered by
Eagle which should be set forth in an amendment of, or a sup-
plement to, the Registration Statement, including the Joint
Proxy Statement/Prospectus, Eagle shall promptly inform Web-
ster, and shall furnish Xxxxxxx with all necessary information
relating to such event, whereupon Xxxxxxx shall promptly cause
an appropriate amendment to the Registration Statement to be
filed with the SEC. Upon the effectiveness of such amendment,
each of Eagle and Xxxxxxx (if prior to the meeting of its re-
spective stockholders pursuant to Section 6.3 hereof) will take
all necessary action as promptly as practicable to permit an
appropriate amendment or supplement to be transmitted to its
stockholders entitled to vote at such meeting. Xxxxxxx shall
also use reasonable efforts to obtain all necessary state secu-
rities law or "Blue Sky" permits and approvals required to car-
ry out the transactions contemplated by this Agreement and the
Bank Merger Agreement and Eagle shall furnish all information
concerning Eagle and the holders of Eagle Common Stock as may
be reasonably requested in connection with any such action.
(b) The parties hereto shall cooperate with
each other and use their best efforts to promptly prepare and
file all necessary documentation, to effect all applications,
notices, petitions and filings, and to obtain as promptly as
practicable all permits, consents, approvals and authorizations
of all third parties and Governmental Entities which are neces-
sary or advisable to consummate the transactions contemplated
by this Agreement (including without limitation the Merger and
the Bank Merger). Eagle and Xxxxxxx shall have the right to
review in advance, and to the extent practicable each will con-
xxxx the other on, in each case subject to applicable laws re-
lating to the exchange of information, all the information re-
lating to Eagle or Xxxxxxx, as the case may be, which appears
in any filing made with, or written materials submitted to, any
third party or any Governmental Entity in connection with the
transactions contemplated by this Agreement; provided, however,
that nothing contained herein shall be deemed to provide either
party with a right to review any information provided to any
Governmental Entity on a confidential basis in connection with
the transactions contemplated hereby. In exercising the fore-
going right, each of the parties hereto shall act reasonably
and as promptly as practicable. The parties hereto agree that
they will consult with each other with respect to the obtaining
of all permits, consents, approvals and authorizations of all
third parties and Governmental Entities necessary or advisable
to consummate the transactions contemplated by this Agreement
and each party will keep the other apprised of the status of
matters relating to consummation of the transactions contem-
plated herein.
(c) Eagle shall, upon request, furnish Xxxxxxx
with all information concerning Eagle and its directors, offic-
ers and stockholders and such other matters as may be reason-
ably necessary or advisable in connection with the Registration
Statement or any other statement, filing, notice or application
made by or on behalf of Xxxxxxx to any Governmental Entity in
connection with the Merger or the other transactions contem-
plated by this Agreement.
(d) Xxxxxxx and Eagle shall promptly advise
each other upon receiving any communication from any Governmen-
tal Entity whose consent or approval is required for consumma-
tion of the transactions contemplated by this Agreement which
causes such party to believe that there is a reasonable likeli-
hood that any Requisite Regulatory Approval (as defined in Sec-
tion 7.1(c) hereof) will not be obtained or that the receipt of
any such approval will be materially delayed.
6.2 ACCESS TO INFORMATION.
(a) Upon reasonable notice and subject to ap-
plicable Laws relating to the exchange of information, Eagle
shall accord to the officers, employees, accountants, counsel
and other representatives of Xxxxxxx, access, during normal
business hours during the period prior to the Effective Time,
to all its and Eagle Bank's properties, books, contracts, com-
mitments and records and, during such period, Eagle shall make
available to Webster (i) a copy of each report, schedule, reg-
istration statement and other document filed or received by it
(including Eagle Bank) during such period pursuant to the re-
quirements of federal securities laws or federal or state bank-
ing laws and (ii) all other information concerning its (includ-
ing Eagle Bank) business, properties and personnel as Xxxxxxx
may reasonably request. Webster shall receive notice of all
meetings of the Eagle and Eagle Bank's Board of Directors and
any committees thereof, and of any management committees (in
all cases, at least as timely as all Eagle and Eagle Bank, as
the case may be, representatives to such meetings are required
to be provided notice). One representative of Xxxxxxx, who
shall be a senior officer of Xxxxxxx, shall be permitted to
attend all meetings of the Board of Directors (except for the
portion of such meetings which relate to the Merger or such
other matters deemed confidential ("Confidential Matters") of
Eagle or Eagle Bank, as the case may be) and such meetings of
committees of the Board of Directors and management of Eagle
and Eagle Bank which Xxxxxxx desires. Xxxxxxx will hold all
such information in confidence to the extent required by, and
in accordance with, the provisions of the confidentiality
agreement which Xxxxxxx entered into with Eagle dated October
15, 1997 (the "Confidentiality Agreement").
(b) Upon reasonable notice and subject to ap-
plicable Laws relating to the exchange of information, Xxxxxxx
shall afford to the officers, employees, accountants, counsel
and other representatives of Eagle, access, during normal busi-
ness hours during the period prior to the Effective Time, to
such information regarding Xxxxxxx as shall be reasonably nec-
xxxxxx for Eagle to fulfill its obligations pursuant to this
Agreement or which may be reasonably necessary for Eagle to
confirm that the representations and warranties of Xxxxxxx con-
tained herein are true and correct and that the covenants of
Xxxxxxx contained herein have been performed in all material
respects. Eagle will hold all such information in confidence
to the extent required by, and in accordance with, the provi-
sions of the Confidentiality Agreement.
(c) No investigation by either of the parties
or their respective representatives shall affect the represen-
tations and warranties of the other set forth herein.
(d) Eagle shall provide Xxxxxxx with true, cor-
rect and complete copies of all financial and other information
provided to directors of Eagle and Eagle Bank in connection
with meetings of their Boards of Directors or committees
thereof.
6.3 STOCKHOLDER MEETINGS.
Each of Xxxxxxx and Eagle shall take all steps neces-
sary to duly call, give notice of, convene and hold a meeting
of its stockholders within 40 days after the Registration
Statement becomes effective for the purpose of voting upon the
approval of this Agreement and the Merger. Management and the
Board of Directors of each of Xxxxxxx and Eagle shall recommend
to Xxxxxxx'x and Eagle's stockholders, as the case may be, ap-
proval of this Agreement, including the Merger, and the trans-
actions contemplated hereby, together with any matters incident
thereto; and in each case shall oppose any third party proposal
or other action that is inconsistent with this Agreement or the
consummation of the transactions contemplated hereby (subject
in each case to compliance with its fiduciary duties as advised
by counsel). Eagle and Xxxxxxx shall coordinate and cooperate
with respect to the foregoing matters.
6.4 LEGAL CONDITIONS TO MERGER.
Each of Xxxxxxx and Eagle shall use their reasonable
best efforts (a) to take, or cause to be taken, all actions
reasonably necessary, proper or advisable to comply promptly
with all legal requirements which may be imposed on such party
with respect to the Merger and, subject to the conditions set
forth in Article VII hereof, to consummate the transactions
contemplated by this Agreement and (b) to obtain (and to coop-
erate with the other party to obtain) any consent, authoriza-
tion, order or approval of, or any exemption by, any Governmen-
tal Entity and any other third party which is required to be
obtained by Eagle or Xxxxxxx in connection with the Merger and
the other transactions contemplated by this Agreement.
6.5 STOCK EXCHANGE LISTING.
Xxxxxxx shall cause the shares of Xxxxxxx Common
Stock to be issued in the Merger and pursuant to options re-
ferred to herein to be approved for quotation on the Nasdaq
Stock Market National Market (or such other exchange on which
the Xxxxxxx Common Stock has become listed, or approved for
listing) prior to or at the Effective Time.
6.6 EMPLOYEES.
(a) To the extent permissible under the ap-
plicable provisions of the Code and ERISA, for purposes of
crediting periods of service for eligibility to participate and
vesting, but not for benefit accrual purposes, under employee
pension benefit plans (within the meaning of ERISA Section
3(2)) maintained by Xxxxxxx or Xxxxxxx Bank, as applicable,
individuals who are employees of Eagle or Eagle Bank at the
Effective Time will be credited with periods of service with
Eagle or Eagle Bank before the Effective Time (including ser-
vice with any predecessor employer for which service credit was
given under similar employee benefit plans of Eagle or Eagle
Bank) as if such service had been with Webster or Xxxxxxx Bank,
as applicable. Similar credit shall also be given by Webster
or Xxxxxxx Bank in calculating other retirement plan, vacation
and similar benefits for such employees of Eagle or Eagle Bank
after the Merger. Webster will or will cause Xxxxxxx Bank to
(i) give credit to employees of Eagle and Eagle Bank, with re-
spect to the satisfaction of the limitations as to pre-existing
condition exclusions and waiting periods for participation and
coverage which are applicable under the welfare benefit plans
of Xxxxxxx or Xxxxxxx Bank, equal to the credit that any such
employee had received as of the Effective Time towards the sat-
isfaction of any such limitations and waiting periods under the
comparable welfare benefit plans of Eagle and Eagle Bank and
(ii) provide each employee of Eagle and Eagle Bank with credit
for any co-payment and deductibles paid prior to the Effective
Time in satisfying any deductible or out-of-pocket require-
ments.
(b) Xxxxxxx shall, and shall cause Xxxxxxx Bank
to pay severance to employees of Eagle and Eagle Bank (i) for a
period of one year following the Effective Time, in accordance
with the terms of the severance policy set forth in Section
6.6(b) of the Eagle Disclosure Schedule and (ii) thereafter in
accordance with the terms of the severance plan maintained by
Xxxxxxx or Xxxxxxx Bank, as the case may be (as in effect from
time to time).
(c) Webster will cause Xxxxxxx Bank to offer a
position of at-will employment to each of Eagle Bank's non-
management branch office personnel in good standing as of the
Effective Time. Webster will use its reasonable best efforts
in connection with reviewing applicants for employment posi-
tions to give Eagle and Eagle Bank employees who are not of-
fered positions at the Effective Time the same consideration as
is afforded Xxxxxxx or Xxxxxxx Bank employees for such posi-
tions in accordance with existing formal or informal policies.
Xxxxxxx will provide outplacement assistance to each Eagle and
Eagle Bank employee who is not offered a position at the Effec-
tive Time.
6.7 INDEMNIFICATION.
(a) In the event of any threatened or actual
claim, action, suit, proceeding or investigation, whether civ-
il, criminal or administrative, in which any person who is now,
or has been at any time prior to the date of this Agreement, or
who becomes prior to the Effective Time, a director or officer
or employee of Eagle or any of its Subsidiaries (the "Indemni-
fied Parties") is, or is threatened to be, made a party based
in whole or in part on, or arising in whole or in part out of,
or pertaining to (i) the fact that he is or was a director,
officer or employee of Eagle or any of its Subsidiaries or any
of their respective predecessors or (ii) this Agreement or the
Option Agreement or any of the transactions contemplated hereby
or thereby, whether in any case asserted or arising before or
after the Effective Time, the parties hereto agree to cooperate
and use their best efforts to defend against and respond there-
to. It is understood and agreed that, after the Effective
Time, Xxxxxxx shall indemnify and hold harmless, as and to the
fullest extent permitted by applicable law, each such Indemni-
fied Party against any losses, claims, damages, liabilities,
costs, expenses (including reasonable attorney's fees and ex-
penses in advance of the final disposition of any claim, suit,
proceeding or investigation to each Indemnified Party to the
fullest extent permitted by law upon receipt of any undertaking
required by applicable law), judgments, fines and amounts paid
in settlement in connection with any such threatened or actual
claim, action, suit, proceeding or investigation, and in the
event of any such threatened or actual claim, action, suit,
proceeding or investigation (whether asserted or arising before
or after the Effective Time), the Indemnified Parties may re-
tain counsel reasonably satisfactory to Xxxxxxx; provided, how-
ever, that (1) Xxxxxxx shall have the right to assume the de-
fense thereof and upon such assumption Xxxxxxx shall not be
liable to any Indemnified Party for any legal expenses of other
counsel or any other expenses subsequently incurred by any In-
demnified Party in connection with the defense thereof, except
that if Xxxxxxx elects not to assume such defense or counsel
for the Indemnified Parties reasonably advises the Indemnified
Parties that there are issues which raise conflicts of interest
between Xxxxxxx and the Indemnified Parties, the Indemnified
Parties may retain counsel reasonably satisfactory to Xxxxxxx,
and Xxxxxxx shall pay the reasonable fees and expenses of such
counsel for the Indemnified Parties, (2) Xxxxxxx shall be obli-
gated pursuant to this paragraph to pay for only one firm of
counsel for each Indemnified Party, and (3) Xxxxxxx shall not
be liable for any settlement effected without its prior written
consent (which consent shall not be unreasonably withheld or
delayed). Any Indemnified Party wishing to claim indemnifica-
tion under this Section 6.7, upon learning of any such claim,
action, suit, proceeding or investigation, shall notify Xxxxxxx
thereof; provided, however, that the failure to so notify shall
not affect the obligations of Xxxxxxx under this Section 6.7
except to the extent such failure to notify materially preju-
dices Xxxxxxx. Xxxxxxx'x obligations under this Section 6.7
continue in full force and effect for a period of six years
from the Effective Time; provided, however, that all rights to
indemnification in respect of any claim asserted or made within
such period shall continue until the final disposition of such
claim.
(b) Xxxxxxx shall use commercially reasonable
efforts to cause the persons serving as officers and directors
of Eagle immediately prior to the Effective Time to be covered
by a directors' and officers' liability insurance policy ("Tail
Insurance") of substantially the same coverage and amounts con-
taining terms and conditions which are generally not less ad-
vantageous than Eagle's current policy with respect to acts or
omissions occurring prior to the Effective Time which were com-
mitted by such officers and directors in their capacity as such
for a period not less than one year.
(c) In the event Xxxxxxx or any of its succes-
sors or assigns (i) consolidates with or merges into any other
person and shall not be the continuing or surviving corporation
or entity of such consolidation or merger, or (ii) transfers or
conveys all or substantially all of its properties and assets
to any person, then, and in each such case, to the extent nec-
xxxxxx, proper provision shall be made so that the successors
and assigns of Xxxxxxx assume the obligations set forth in this
section.
(d) The provisions of this Section 6.7 are in-
tended to be for the benefit of, and shall be enforceable by,
each Indemnified Party and his or her heirs and representa-
tives.
6.8 SUBSEQUENT INTERIM AND ANNUAL FINANCIAL
STATEMENTS.
As soon as reasonably available, but in no event more
than 45 days after the end of each fiscal quarter (other than
the fourth fiscal quarter), Xxxxxxx will deliver to Eagle and
Eagle will deliver to Xxxxxxx their respective Quarterly Re-
ports on Form 10-Q, as filed with the SEC under the Exchange
Act. Each party shall deliver to the other any Current Reports
on Form 8-K promptly after filing such reports with the SEC.
6.9 ADDITIONAL AGREEMENTS.
In case at any time after the Effective Time any fur-
ther action is necessary or desirable to carry out the purposes
of this Agreement, or to vest the Surviving Corporation or the
Surviving Bank with full title to all properties, assets, righ-
ts, approvals, immunities and franchises of any of the parties
to the Merger, or the constituent banks to the Bank Merger, as
the case may be, the proper officers and directors of each
party to this Agreement and Xxxxxxx'x and Eagle's Subsidiaries
shall take all such necessary action as may be reasonably re-
quested by Xxxxxxx.
6.10 ADVICE OF CHANGES.
Xxxxxxx and Eagle shall promptly advise the other
party of any change or event that, individually or in the ag-
gregate, has had or would be reasonably certain to have a Mate-
rial Adverse Effect on it or to cause or constitute a material
breach of any of its representations, warranties or covenants
contained herein. From time to time prior to the Effective
Time, each party will promptly supplement or amend its disclo-
sure schedule delivered in connection with the execution of
this Agreement to reflect any matter which, if existing, occur-
ring or known at the date of this Agreement, would have been
required to be set forth or described in such disclosure sched-
ule or which is necessary to correct any information in such
disclosure schedule which has been rendered inaccurate thereby.
No supplement or amendment to such disclosure schedule shall
have any effect for the purpose of determining satisfaction of
the conditions set forth in Sections 7.2(a) or 7.3(a) hereof,
as the case may be, or the compliance by Eagle or Xxxxxxx, as
the case may be, with the respective covenants set forth in
Sections 5.1 and 5.2 hereof.
6.11 CURRENT INFORMATION.
During the period from the date of this Agreement to
the Effective Time, Eagle will cause one or more of its desig-
nated representatives to confer on a regular and frequent ba-
sis (not less than monthly) with representatives of Xxxxxxx
and to report the general status of the ongoing operations of
Eagle. Eagle will promptly notify Xxxxxxx of any material
change in the normal course of business or in the operation of
the properties of Eagle and of any governmental complaints,
investigations or hearings (or communications indicating that
the same may be contemplated), or the institution or the threat
of litigation involving Eagle, and will keep Xxxxxxx fully in-
formed of such events.
6.12 EXECUTION AND AUTHORIZATION OF BANK MERGER
AGREEMENT.
Prior to the Effective Time, (a) Xxxxxxx and Eagle
shall each approve the Bank Merger Agreement as the sole stock-
holder of Xxxxxxx Bank and Eagle Bank, respectively, and (b)
Eagle Bank shall execute and deliver the Bank Merger Agreement.
6.13 CHANGE IN STRUCTURE.
Xxxxxxx may elect to modify the structure of the
transactions contemplated by this Agreement as noted herein so
long as (i) there are no adverse tax consequences to the Eagle
stockholders as a result of such modification, (ii) the consid-
eration to be paid to the Eagle stockholders under this Agree-
ment is not thereby changed or reduced in amount, and (iii)
such modification will not delay or jeopardize receipt of any
required regulatory approvals. In the event that the structure
of the Merger is modified pursuant to this Section 6.13, the
parties agree to modify this Agreement and the various exhibits
hereto to reflect such revised structure. In such event, Web-
ster shall prepare appropriate amendments to this Agreement and
the exhibits hereto for execution by the parties hereto. Eagle
agrees to cooperate fully with Xxxxxxx to effect such amend-
ments.
6.14 TRANSACTION EXPENSES OF EAGLE.
As promptly as practicable after the execution of
this Agreement, Eagle will provide to Xxxxxxx an estimate of
the expenses Eagle expects to incur in connection with the
Merger, and shall keep Xxxxxxx reasonably informed of material
changes in such estimate.
6.15 AFFILIATE AGREEMENTS.
(a) Not later than the 15th day prior to the mailing
of the Joint Proxy Statement/Prospectus, (i) Xxxxxxx shall de-
liver to Eagle a schedule of each person that, to the best of
its knowledge, is or is reasonably likely to be, as of the date
of the Xxxxxxx stockholder meeting called pursuant to Section
6.3, deemed to be an "affiliate" of it (each, a "Xxxxxxx Affil-
iate") as that term is used in SEC Accounting Series Releases
130 and 135; and (ii) Eagle shall deliver to Xxxxxxx a schedule
of each person that, to the best of its knowledge, is or is
reasonably likely to be, as of the date of the Eagle stock-
holder meeting called pursuant to Section 6.3, deemed to be an
"affiliate of it (each, an "Eagle Affiliate") as that term is
used in Rule 145 under the Securities Act or SEC Accounting
Series Releases 130 and 135.
(b) Each of Eagle and Xxxxxxx shall use its respec-
tive reasonable best efforts to cause each person who may be
deemed to be an Eagle Affiliate or a Xxxxxxx Affiliate, as the
case may be, to execute and deliver to Eagle and Xxxxxxx on or
before the date of mailing of the Joint Proxy Statement/
Prospectus an agreement in the form attached hereto as Exhibit
D or Exhibit E, respectively.
ARTICLE VII
CONDITIONS PRECEDENT
7.1 CONDITIONS TO EACH PARTY'S OBLIGATION
TO EFFECT THE MERGER.
The respective obligation of each party to effect the
Merger shall be subject to the satisfaction at or prior to the
Effective Time of the following conditions:
(a) STOCKHOLDER APPROVALS.
This Agreement and the Merger shall have been
approved and adopted by the requisite votes of the Eagle stock-
holders and the Xxxxxxx stockholders.
(b) STOCK EXCHANGE LISTING.
The shares of Xxxxxxx Common Stock which shall
be issued in the Merger (including the Xxxxxxx Common Stock
that may be issued upon exercise of the options referred to in
Section 1.6 hereof) upon consummation of the Merger shall have
been authorized for quotation on the Nasdaq Stock Market Na-
tional Market (or such other exchange on which the Xxxxxxx Com-
mon Stock may become listed).
(c) OTHER APPROVALS.
All regulatory approvals required to consummate
the transactions contemplated hereby shall have been obtained
and shall remain in full force and effect and all statutory
waiting periods in respect thereof shall have expired (all such
approvals and the expiration of all such waiting periods being
referred to herein as the "Requisite Regulatory Approvals").
(d) REGISTRATION STATEMENT.
The Registration Statement shall have become
effective under the Securities Act, and no stop order suspend-
ing the effectiveness of the Registration Statement shall have
been issued and no proceedings for that purpose shall have been
initiated or threatened by the SEC.
(e) NO INJUNCTIONS OR RESTRAINTS; ILLEGALITY.
No order, injunction or decree issued by any
court or agency of competent jurisdiction or other legal re-
straint or prohibition (an "Injunction") preventing the consum-
mation of the Merger or any of the other transactions contem-
plated by this Agreement or the Certificate of Merger shall be
in effect. No statute, rule, regulation, order, injunction or
decree shall have been enacted, entered, promulgated or en-
forced by any Governmental Entity which prohibits, restricts or
makes illegal consummation of the Merger. No proceeding initi-
ated by any Governmental Entity seeking an Injunction shall be
pending.
(f) FEDERAL TAX OPINION.
Xxxxxxx shall have received an opinion from
Wachtell, Lipton, Xxxxx & Xxxx, counsel to Xxxxxxx, and Eagle
shall have received an opinion from Skadden, Arps, Slate,
Xxxxxxx & Xxxx LLP, counsel to Eagle, in form and substance
reasonably satisfactory to Xxxxxxx or Eagle, respectively, dat-
ed the date of the Effective Time, in each case, substantially
to the effect that on the basis of facts, representations, and
assumptions set forth in such opinion which are consistent with
the state of facts existing at the Effective Time, the Merger
will be treated for federal income tax purposes as a reorgani-
zation within the meaning of Section 368(a) of the Code and
each of Xxxxxxx and Eagle will be a party to the reorganization
with the meaning of Section 368(b) of the Code and that, ac-
cordingly, for federal income tax purposes, (i) no gain or loss
will be recognized by Xxxxxxx or Eagle as a result of the
Merger, (ii) no gain or loss will be recognized by the stock-
holders of Eagle who exchange all of the Eagle Common Stock
solely for Xxxxxxx Common Stock pursuant to the Merger (except
with respect to cash received in lieu of a fractional share
interest in Xxxxxxx Common Stock), and (iii) the aggregate tax
basis of the Xxxxxxx Common Stock received by stockholders who
exchange all of their Eagle Common Stock solely for Xxxxxxx
Common Stock pursuant to the Merger will be the same as the
aggregate tax basis of the Eagle Common Stock surrendered in
exchange therefor (reduced by any amount allocable to a frac-
tional share interest for which cash is received). In render-
ing such opinion, such counsel shall require and, to the extent
such counsel deems necessary or appropriate, may rely upon rep-
resentations and covenants, including those contained in cer-
tificates of officers of Eagle, Xxxxxxx, their respective af-
filiates and others.
7.2 CONDITIONS TO OBLIGATIONS OF XXXXXXX.
The obligation of Xxxxxxx to effect the Merger is
also subject to the satisfaction or waiver by Xxxxxxx at or
prior to the Effective Time of the following conditions:
(a) REPRESENTATIONS AND WARRANTIES.
The representations and warranties of Eagle set
forth in this Agreement shall be true and correct as of the
date of this Agreement and (except to the extent such represen-
tations and warranties speak as of an earlier date) as of the
Closing Date as though made on and as of the Closing Date; pro-
vided, however, that for purposes of this paragraph, such rep-
resentations and warranties shall be deemed to be true and cor-
rect, unless the failure or failures of such representations
and warranties to be so true and correct, individually or in
the aggregate, would have a Material Adverse Effect on Eagle.
Such determination of aggregate Material Adverse Effect shall
be made as if there were no materiality qualifications in such
representations and warranties. Xxxxxxx shall have received a
certificate signed on behalf of Eagle by each of the President
and Chief Executive Officer and the Chief Financial Officer of
Eagle to the foregoing effect.
(b) PERFORMANCE OF COVENANTS AND
AGREEMENTS OF EAGLE
Eagle shall have performed in all material re-
spects all covenants and agreements required to be performed by
it under this Agreement at or prior to the Closing Date. Web-
ster shall have received a certificate signed on behalf of
Eagle by each of the President and Chief Executive Officer and
the Chief Financial Officer of Eagle to such effect.
(c) POOLING OF INTERESTS.
Xxxxxxx shall have received as of the Effective
Time, a written opinion of KPMG Peat Marwick LLP to the effect
that the Merger will be accounted for as a pooling-of-
interests.
7.3 CONDITIONS TO OBLIGATIONS OF EAGLE.
The obligation of Eagle to effect the Merger is also
subject to the satisfaction or waiver by Eagle at or prior to
the Effective Time of the following conditions:
(a) REPRESENTATIONS AND WARRANTIES.
The representations and warranties of Xxxxxxx
set forth in this Agreement shall be true and correct as of the
date of this Agreement and (except to the extent such represen-
tations and warranties speak as of an earlier date) as of the
Closing Date as though made on and as of the Closing Date; pro-
vided, however, that for purposes of this paragraph, such rep-
resentations and warranties shall be deemed to be true and cor-
rect, unless the failure or failures of such representations
and warranties to be so true and correct, individually or in
the aggregate, would have a Material Adverse Effect on Xxxxxxx.
Such determination of aggregate Material Adverse Effect shall
be made as if there were no materiality qualifications in such
representations and warranties. Eagle shall have received a
certificate signed on behalf of Xxxxxxx by each of the Presi-
dent and Chief Executive Officer and the Chief Financial Of-
ficer of Xxxxxxx to the foregoing effect.
(b) PERFORMANCE OF COVENANTS AND
AGREEMENTS OF XXXXXXX.
Xxxxxxx shall have performed in all material
respects all covenants and agreements required to be performed
by it under this Agreement at or prior to the Closing Date.
Eagle shall have received a certificate signed on behalf of
Xxxxxxx by each of the President and Chief Executive Officer
and the Chief Financial Officer of Xxxxxxx to such effect.
(c) POOLING OF INTERESTS.
Xxxxxxx shall have received as of the Effective
Time, a written opinion of KPMG Peat Marwick LLP to the effect
that the Merger will be accounted for as a pooling-of-
interests.
ARTICLE VIII
TERMINATION AND AMENDMENT
8.1 TERMINATION.
This Agreement may be terminated at any time prior to
the Effective Time, whether before or after approval of this
Agreement by the stockholders of Eagle or Xxxxxxx:
(a) by mutual consent of Xxxxxxx and Eagle in a
written instrument, if the Board of Directors of each so deter-
mines by a vote of a majority of the members of its entire
Board;
(b) by either Xxxxxxx or Eagle upon written
notice to the other party (i) 30 days after the date on which
any request or application for a Requisite Regulatory Approval
shall have been denied or withdrawn at the request or recom-
mendation of the Governmental Entity which must grant such Req-
uisite Regulatory Approval, unless within the 30-day period
following such denial or withdrawal the parties agree to file,
and have filed with the applicable Governmental Entity, a peti-
tion for rehearing or an amended application, provided, how-
ever, that no party shall have the right to terminate this
Agreement, if such denial or request or recommendation for
withdrawal shall be due to the failure of the party seeking to
terminate this Agreement to perform or observe the covenants
and agreements of such party set forth herein;
(c) by either Xxxxxxx or Eagle if the Merger
shall not have been consummated on or before September 30,
1998, unless the failure of the Closing to occur by such date
shall be due to the failure of the party seeking to terminate
this Agreement to perform or observe the covenants and agree-
ments of such party set forth herein;
(d) by either Xxxxxxx or Eagle (provided that
the terminating party is not in breach of its obligations under
Section 6.3 hereof) if the approval of the stockholders of
Eagle or Xxxxxxx required for the consummation of the Merger
shall not have been obtained by reason of the failure to obtain
the required vote at the respective duly held meetings of
stockholders or at any adjournment or postponement thereof;
(e) by either Xxxxxxx or Eagle (provided that
the terminating party is not then in breach of any representa-
tion, warranty, covenant or other agreement contained herein
that, individually or in the aggregate, would give the other
party the right to terminate this Agreement) if there shall
have been a breach of any of the representations or warranties
set forth in this Agreement on the part of the other party, if
such breach, individually or in the aggregate, has had or would
be reasonably certain to have a Material Adverse Effect on the
breaching party, and such breach shall not have been cured
within 30 days following receipt by the breaching party of
written notice of such breach from the other party hereto or
such breach, by its nature, cannot be cured prior to the Clos-
ing;
(f) by either Xxxxxxx or Eagle (provided that
the terminating party is not then in breach of any representa-
tion, warranty, covenant or other agreement contained herein
that, individually or in the aggregate, would give the other
party the right to terminate this Agreement) if there shall
have been a material breach of any of the covenants or agree-
ments set forth in this Agreement on the part of the other par-
ty, and such breach shall not have been cured within 30 days
following receipt by the breaching party of written notice of
such breach from the other party hereto or such breach, by its
nature, cannot be cured prior to the Closing;
(g) by either the Board of Directors of Xxxxxxx
or the Board of Directors of Eagle, if the Board of Directors
of the other party shall have withdrawn, modified or changed in
a manner adverse to the terminating party its approval or rec-
ommendation of this Agreement and the transactions contemplated
thereby; and
(h) by the Board of Directors of Eagle, upon
written notice to Xxxxxxx at any time during the ten-day period
commencing two days after the Determination Date (as defined
below), if both of the following conditions are satisfied:
(i) the Average Closing Price shall be less than the
product of 0.80 and the Starting Price; and
(ii) (A) the quotient obtained by dividing the Aver-
age Closing Price by the Starting Price (such
number being referred to herein as the "Xxxxxxx
Ratio") shall be less than (B) the quotient ob-
tained by dividing the Average Index Price by
the Index Price on the Starting Date and sub-
tracting 0.15 from the quotient in this clause
(ii)(B) (such number being referred to herein as
the "Index Ratio");
subject, however, to the following provisions. If Eagle elects
to exercise its termination right pursuant to the immediately
preceding sentence, it shall give prompt written notice to Web-
ster; provided, however, that such notice of election to termi-
nation may be withdrawn at any time within the aforementioned
ten-day period. During the five-day period commencing with its
receipt of such notice, Xxxxxxx shall have the option to elect
to increase the Exchange Ratio to equal the lesser of (i) the
quotient obtained by dividing (A) the product of 0.80, the
Starting Price and the Exchange Ratio (as then in effect) by
(B) the Average Closing Price, and (ii) the quotient obtained
by dividing (A) the product of the Index Ratio and the Exchange
Ratio (as then in effect) by (B) the Xxxxxxx Ratio. If Xxxxxxx
makes such an election within such five-day period, it shall
give prompt written notice to Eagle of such election and of the
revised Exchange Ratio, whereupon no termination shall have
occurred pursuant to this Section 8.1(h) and this Agreement
shall remain in effect in accordance with its terms (except as
the Exchange Ratio shall have been so modified), and any refer-
ences in this Agreement to "Exchange Ratio" shall thereafter be
deemed to refer to the Exchange Ratio as adjusted pursuant to
this Section 8.1(h) (and corresponding a corresponding modifi-
cation shall be made to the Maximum Share Amount).
For purposes of this Section 8.1(h), the following
terms shall have the meanings indicated:
"Average Closing Price" means the average of the
daily last sale prices of Xxxxxxx Common Stock as reported on
Nasdaq (as reported in The Wall Street Journal or, if not re-
ported therein, in another mutually agreed upon authoritative
source) for the ten consecutive full trading days in which such
shares are traded on Nasdaq ending at the close of trading on
the Determination Date.
"Average Index Price" means the average of the Index
Prices for the ten consecutive full trading days ending at the
close of trading on the Determination Date.
"Determination Date" means the date on which the ap-
proval of the OTS required for consummation of the Merger shall
be received.
"Index Group" means the 16 savings and loan holding
companies listed below, the common stocks of all of which shall
be publicly traded and as to which there shall not have been,
since the Starting Date and before the Determination Date, an
announcement of a proposal for such company to be acquired or
for such company to acquire another company or companies in
transactions with a value exceeding 25% of the acquiror's mar-
ket capitalization as of the Starting Date. In the event that
the common stock of any such company ceases to be publicly
traded or any such announcement is made with respect to any
such company, such company shall be removed from the Index
Group, and the weights (which have been determined based on the
number of outstanding shares of common stock) redistributed
proportionately for purposes of determining the Index Price.
The 16 savings and loan holding companies and the weights at-
tributed to them are as follows:
Holding Company Weighting (%)
Washington Federal..................12.39
Bank United Corp.....................8.25
Peoples Heritage Financial Group.....7.17
Astoria Financial Corp...............5.48
Commercial Federal Corp..............5.63
Xxxxxx Bancorp Inc..................11.39
St. Xxxx Bancorp Inc.................8.91
Xxxxxx Financial Corp................6.98
TR Financial Corp....................4.57
Queens County Bancorp Inc............3.94
Westcorp.............................6.84
ALBANK Financial Corp................3.36
MAF Bancorp Inc......................4.02
CFX Corp.............................6.26
CitFed Bancorp Inc...................2.25
JSB Financial Inc....................2.57
"Index Price" on a given date means the weighted av-
erage (weighted in accordance with the factors listed above) of
the closing prices on such date of the companies comprising the
Index Group.
"Starting Date" means the last full day on which Nas-
daq was open for trading prior to the execution of this Agree-
ment.
"Starting Price" shall mean the last sale price per
share of Xxxxxxx Common Stock on the Starting Date, as reported
on Nasdaq (as reported in The Wall Street Journal or, if not
reported therein, in another mutually agreed upon authoritative
source).
If Xxxxxxx or any company belonging to the Index
Group declares or effects a stock dividend, reclassification,
recapitalization, slit-up, combination, exchange of shares or
similar transaction between the Starting Date and the Determi-
nation Date, the prices for the common stock of such company
shall be appropriately adjusted for the purposes of applying
this Section 8.1(h).
8.2 EFFECT OF TERMINATION.
In the event of termination of this Agreement by ei-
ther Xxxxxxx or Eagle as provided in Section 8.1 hereof, this
Agreement shall forthwith become void and have no effect except
(i) the last sentences of Sections 6.2(a) and 6.2(b) and Sec-
tions 8.2, 9.2 and 9.3 hereof shall survive any termination of
this Agreement, and (ii) notwithstanding anything to the con-
trary contained in this Agreement, no party shall be relieved
or released from any liabilities or damages arising out of its
willful or intentional breach of any provision of this Agree-
ment.
8.3 AMENDMENT.
Subject to compliance with applicable law, this
Agreement may be amended by the parties hereto, by action taken
or authorized by their respective Board of Directors, at any
time before or after approval of the matters presented in con-
nection with the Merger by the stockholders of Eagle; provided,
however, that after any approval of the transactions contem-
plated by this Agreement by Eagle's stockholders, there may not
be, without further approval of such stockholders, any amend-
ment of this Agreement which reduces the amount or changes the
form of the consideration to be delivered to Eagle stockholders
hereunder other than as contemplated by this Agreement. This
Agreement may not be amended except by an instrument in writing
signed on behalf of each of the parties hereto.
8.4 EXTENSION; WAIVER.
At any time prior to the Effective Time, the parties
hereto, by action taken or authorized by their respective
Boards of Directors, may, to the extent legally allowed, (a)
extend the time for the performance of any of the obligations
or other acts of the other parties hereto, (b) waive any inac-
curacies in the representations and warranties contained herein
or in any document delivered pursuant hereto, and (c) waive
compliance with any of the agreements or conditions contained
herein. Any agreement on the part of a party hereto to any
such extension or waiver shall be valid only if set forth in a
written instrument signed on behalf of such party, but such
extension or waiver or failure to insist on strict compliance
with an obligation, covenant, agreement or condition shall not
operate as a waiver of, or estoppel with respect to, any subse-
quent or other failure.
ARTICLE IX
GENERAL PROVISIONS
9.1 CLOSING.
Subject to the terms and conditions of this Agree-
ment, the closing of the Merger (the "Closing") will take place
at 10:00 a.m. at the main offices of Xxxxxxx on (i) the fif-
teenth day after the last Requisite Regulatory Approval is re-
ceived and all applicable waiting periods have expired, or (ii)
such other date, place and time as the parties may agree (the
"Closing Date").
9.2 NONSURVIVAL OF REPRESENTATIONS,
WARRANTIES AND AGREEMENTS.
None of the representations, warranties, covenants
and agreements in this Agreement or in any instrument delivered
pursuant to this Agreement (other than pursuant to the Option
Agreement, which shall terminate in accordance with its terms)
shall survive the Effective Time, except for those covenants
and agreements contained herein and therein which by their
terms apply in whole or in part after the Effective Time.
9.3 EXPENSES.
All costs and expenses incurred in connection with
this Agreement and the transactions contemplated hereby shall
be paid by the party incurring such expense, except that all
filing and other fees paid to the SEC in connection with this
Agreement and printing fees in connection with the Joint Proxy
Statement/Prospectus shall be borne equally by Xxxxxxx and
Eagle. Notwithstanding the foregoing and without limitation of
any party's rights under clause (ii) of Section 8.2, in the
event that this Agreement is terminated by either Xxxxxxx or
Eagle by reason of a material breach pursuant to Sections
8.1(e) or (f) hereof, the other party shall pay all documented,
reasonable costs and expenses up to $1,500,000 incurred by the
terminating party in connection with this Agreement and the
transactions contemplated hereby.
9.4 NOTICES.
All notices and other communications hereunder shall
be in writing and shall be deemed given if delivered person-
ally, mailed by registered or certified mail (return receipt
requested) or delivered by an express courier (with confirma-
tion) to the parties at the following addresses (or at such
other address for a party as shall be specified by like no-
xxxx):
(a) if to Webster, to:
Xxxxxxx Financial Corporation
Xxxxxxx Plaza
000 Xxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Attn.: Xxxxx X. Xxxxx
Chairman and Chief
Executive Officer
WITH A COPY TO:
Wachtell, Lipton, Xxxxx & Xxxx
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn.: Xxxxx X. Xxxxxxxxx, Esq.
and
(b) if to Eagle, to:
Eagle Financial Corp.
000 Xxxx Xxxxxx
Xxxxxxx, XX 00000
Attn.: Xxxxxx X. Xxxxxxx
President and Chief
Executive Officer
WITH A COPY TO:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn.: Xxxxxxx X. Xxxxxxxxxx, Esq.
9.5 INTERPRETATION.
When a reference is made in this Agreement to Sec-
tions, Exhibits or Schedules, such reference shall be to a Sec-
tion of or an Exhibit or Schedule to this Agreement unless oth-
erwise indicated. The table of contents and headings contained
in this Agreement are for reference purposes only and shall not
affect in any way the meaning or interpretation of this Agree-
ment. Whenever the words "include", "includes" or "including"
are used in this Agreement, they shall be deemed to be followed
by the words "without limitation". No provision of this Agree-
ment shall be construed to require Xxxxxxx, Eagle or any of
their respective Subsidiaries or affiliates to take any action
that would violate any applicable law, rule or regulation.
9.6 COUNTERPARTS.
This Agreement may be executed in counterparts, all
of which shall be considered one and the same agreement and
shall become effective when counterparts have been signed by
each of the parties and delivered to the other parties, it
being understood that all parties need not sign the same coun-
terpart.
9.7 ENTIRE AGREEMENT.
This Agreement (including the disclosure schedules,
documents and the instruments referred to herein) constitutes
the entire agreement and supersedes all prior agreements and
understandings, both written and oral, among the parties with
respect to the subject matter hereof, other than the Confi-
dentiality Agreement, the Bank Merger Agreement, the Certifi-
cate of Merger and the Option Agreement.
9.8 GOVERNING LAW.
This Agreement shall be governed and construed in
accordance with the laws of the State of Delaware, without re-
gard to any applicable conflicts of law rules.
9.9 ENFORCEMENT OF AGREEMENT.
The parties hereto agree that irreparable damage
would occur in the event that the provisions of this Agreement
were not performed in accordance with its specific terms or
were otherwise breached. It is accordingly agreed that the
parties shall be entitled to an injunction or injunctions to
prevent breaches of this Agreement and to enforce specifically
the terms and provisions thereof in any court of the United
States or any state having jurisdiction, this being in addition
to any other remedy to which they are entitled at law or in
equity.
9.10 SEVERABILITY.
Any term or provision of this Agreement which is in-
valid or unenforceable in any jurisdiction shall, as to that
jurisdiction, be ineffective to the extent of such invalidity
or unenforceability without rendering invalid or unenforceable
the remaining terms and provisions of this Agreement or affect-
ing the validity or enforceability of any of the terms or pro-
visions of this Agreement in any other jurisdiction. If any
provision of this Agreement is so broad as to be unenforceable,
the provision shall be interpreted to be only so broad as is
enforceable.
9.11 PUBLICITY.
Except as otherwise required by law or the rules of
the Nasdaq Stock Market National Market (or such other exchange
on which the Xxxxxxx Common Stock may become listed), so long
as this Agreement is in effect, neither Xxxxxxx nor Eagle
shall, or shall permit any of Xxxxxxx'x or Eagle's Subsidiaries
to, issue or cause the publication of any press release or
other public announcement with respect to, or otherwise make
any public statement concerning, the transactions contemplated
by this Agreement, the Bank Merger Agreement or the Option
Agreement without the consent of the other party, which consent
shall not be unreasonably withheld.
9.12 ASSIGNMENT; LIMITATION OF BENEFITS.
Neither this Agreement nor any of the rights, inter-
ests or obligations hereunder shall be assigned by any of the
parties hereto (whether by operation of law or otherwise) with-
out the prior written consent of the other parties. Subject to
the preceding sentence, this Agreement will be binding upon,
inure to the benefit of and be enforceable by the parties and
their respective successors and assigns. Except as otherwise
specifically provided in Section 6.7 hereof, this Agreement
(including the documents and instruments referred to herein) is
not intended to confer upon any person other than the parties
hereto any rights or remedies hereunder, and the covenants,
undertakings and agreements set out herein shall be solely for
the benefit of, and shall be enforceable only by, the parties
hereto and their permitted assigns.
9.13 ADDITIONAL DEFINITIONS.
In addition to any other definitions contained in
this Agreement, the following words, terms and phrases shall
have the following meanings when used in this Agreement.
"Affiliated Person": any director, officer or 5%
or greater stockholder, spouse or other person living in the
same household of such director, officer or stockholder, or any
company, partnership or trust in which any of the foregoing
persons is an officer, 10% or greater stockholder, general
partner or 10% or greater trust beneficiary.
"Laws": any and all statutes, laws, ordinances,
rules, regulations, orders, permits, judgments, injunctions,
decrees, case law and other rules of law enacted, promulgated
or issued by any Governmental Entity.
"Material Adverse Effect": with respect to Xxxxxxx
or Eagle, as the case may be, means a condition, event, change
or occurrence that has had or is reasonably certain to have a
material adverse effect upon (A) the financial condition, re-
sults of operations or business of such party and its Subsid-
iaries, taken as a whole, or (B) the ability of Xxxxxxx or
Eagle to timely perform its obligations under, and to consum-
mate the transactions contemplated by, this Agreement and the
Option Agreement; provided, however, that in determining
whether a Material Adverse Effect has occurred there shall be
excluded any effect on the referenced party the cause of which
is (i) any change in banking or similar laws, rules or regula-
tions of general applicability or interpretations thereto by
courts or governmental authorities, (ii) any change in gener-
ally accepted accounting principles or regulatory accounting
requirements applicable to banks, thrifts or their holding com-
panies generally, (iii) any action or omission of Eagle or Web-
ster or any Subsidiary of either of them taken with the prior
written consent of Xxxxxxx or Eagle, as applicable, in contem-
plation of the Merger, (iv) any expenses reasonably incurred by
such party in connection with this Agreement or the transac-
tions contemplated hereby and (v) any changes in general eco-
nomic conditions affecting banks, thrifts or their holding com-
panies generally.
"Subsidiary": with respect to any party means any
corporation, partnership or other organization, whether incor-
porated or unincorporated, which is consolidated with such par-
ty for financial reporting purposes.
IN WITNESS WHEREOF, Webster and Eagle have caused
this Agreement to be executed and delivered by their respective
officers thereunto duly authorized as of the date first above
written.
XXXXXXX FINANCIAL CORPORATION
By: /s/ Xxxxx X. Xxxxx
Name: Xxxxx X. Xxxxx
Title: Chairman and Chief
Executive Officer
EAGLE FINANCIAL CORP.
By: /s/ Xxxxxx X. Xxxxxxx
Name: Xxxxxx X. Xxxxxxx
Title: President and Chief
Executive Officer
[Merger Agreement]