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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 or 15(d) of
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report:
(Date of earliest event reported)
September 10, 1995
UJB Financial Corp.
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(Exact name of registrant as specified in its charter)
NEW JERSEY 1-6451 22-1903313
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(State or other juris- (Commission (IRS Employer
diction of incorporation File No.) Identification No.)
or organization)
301 Carnegie Center, P.O. Box 2066,
Princeton, New Jersey 08543-2066
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(Address of principal executive offices)
Registrant's telephone number, including area code (609) 987-3200
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Item 5. Other Information.
Agreement and Plan of Merger
On September 10, 1995, Registrant and The Summit Bancorporation ("Summit"),
entered into an Agreement and Plan of Merger (the "Agreement") providing for,
among other things, (i) the merger of Summit into the Registrant (the "Merger");
(ii) the exchange of each outstanding share of the Common Stock of Summit
("Summit Common") for 0.90 shares of the Common Stock of the Registrant ("UJB
Common"), with cash being paid in lieu of issuing fractional shares of UJB
Common; and (iii) the exchange of each outstanding share of the $25 stated value
Adjustable Rate Cumulative Preferred Stock of Summit for one share of a newly
created class of Preferred Stock of the surviving corporation in the Merger
designated the $25 stated value Adjustable Rate Cumulative Preferred Stock; all
upon the satisfaction of the terms and conditions set forth in the Agreement,
including the receipt of approval from the shareholders of both the Registrant
and Summit and the Board of Governors of the Federal Reserve System. No
assurance can be given that the Merger will be consummated.
In connection with the execution of the Agreement, Summit granted to the
Registrant an option to purchase, under certain circumstances, up to 6,730,000
shares of Summit Common, which would constitute on the date hereof 19.9% of
the outstanding shares of Summit Common. Similarly, the Registrant granted
Summit an option to purchase, under certain circumstances, up to 11,450,000
shares of UJB Common, which would constitute on the date hereof 19.9% of the
outstanding shares of UJB Common. The exercise prices of the options,
respectively, $26.75 and $36.625, were arrived at by mutual agreement of the
parties.
Item 7. Financial Statements and Exhibits.
(c) Exhibits
Exhibit No. Description
- ---------- -----------
(2) Agreement and Plan of Merger, dated September 10, 1995, between UJB
Financial Corp. and The Summit Bancorporation, including Exhibits A
through F thereto. (The Agreement and Plan of Merger is incorporated
by reference to Exhibit 10(a) to the Schedule 13D dated September 11,
1995 filed by Registrant with respect to the Common Stock, no par
value, of The Summit Bancorporation. Exhibit A to the Agreement and
Plan of Merger is contained at Exhibit (4) to this Current Report on
Form 8-K. Exhibit B to the Agreement and Plan of Merger is
incorporated by reference to Exhibit 10(b) to the Schedule 13D dated
September 11, 1995 filed by Registrant with respect to the Common
Stock, no par value, of The Summit Bancorporation.)
(4) UJB Stock Option Agreement dated as of September 11, 1995, by and
between Summit, as Grantee, and the Registrant, as Issuer.
(99) Summit Stock Option Agreement dated as of September 11, 1995, by and
between the Registrant, as Grantee, and Summit, as Issuer.
(Incorporated by reference to Exhibit 10(b) to Schedule 13D dated
September 11, 1995 filed by Registrant with respect to the Common
Stock, no par value, of The Summit Bancorporation.)
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SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange Act
of 1934, the registrant has duly caused this Current Report on Form 8-K to be
signed on its behalf by the undersigned, thereto duly authorized.
Date: September 25, 1995 UJB FINANCIAL CORP.
By: /s/ DENNIS A. WILLIAMS
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Dennis A. Williams
Senior Vice President
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EXHIBIT INDEX
Ex. No. Description
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(2) Agreement and Plan of Merger, dated September 10, 1995, between UJB
Financial Corp. and The Summit Bancorporation, including Exhibits A
through F thereto. (The Agreement and Plan of Merger is incorporated by
reference to Exhibit 10(a) to the Schedule 13D dated September 11,
1995 filed by Registrant with respect to the Common Stock, no par
value, of The Summit Bancorporation. Exhibit A to the Agreement and
Plan of Merger is contained at Exhibit (4) to this Current Report on
Form 8-K. Exhibit B to the Agreement and Plan of Merger is
incorporated by reference to Exhibit 10(b) to the Schedule 13D dated
September 11, 1995 filed by Registrant with respect to the Common
Stock, no par value, of The Summit Bancorporation.)
(4) UJB Stock Option Agreement dated as of September 11, 1995, by and
between Summit, as Grantee, and the Registrant, as Issuer.
(99) Summit Stock Option Agreement dated as of September 11, 1995, by and
between the Registrant, as Grantee, and Summit, as Issuer. (Incorporated
by reference to Exhibit 10(b) to the Schedule 13D dated September 11,
1995 filed by Registrant with respect to the Common Stock, no par value,
of The Summit Bancorporation.
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Exhibit (2)
AGREEMENT AND PLAN OF MERGER
(Incorporated by reference to Exhibit 10(a) to the Schedule 13D dated
September 11, 1995 filed by Registrant with respect to the Common Stock, no par
value, of The Summit Bancorporation).
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Exhibit A to the
Agreement and Plan of Merger
UJB FINANCIAL CORP. STOCK OPTION AGREEMENT
(Contained at Exhibit (4) to this Current Report on Form 8-K).
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Exhibit B to the
Agreement and Plan of Merger
THE SUMMIT BANCORPORATION STOCK OPTION AGREEMENT
(Incorporated by Reference to Exhibit 10(b) to the Schedule 13D dated September
11, 1995 filed by Registrant with respect to the Common Stock, no par value, of
The Summit Bancorporation).
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Exhibit C to the
Agreement and Plan of Merger
Name of Affiliate:_________________________
UJB Financial Corp.
301 Carnegie Center
P.O. Box 2066
Princeton, New Jersey 08543
Gentlemen:
This letter agreement is being entered into pursuant to the terms of the
Agreement and Plan of Merger, dated September 10, 1995 (the "Merger Agreement"),
between UJB Financial Corp. ("UJB") and The Summit Bancorporation ("Summit"),
which provides, among other things, (i) for the merger of Summit with and into
UJB (the "Merger"), (ii) the conversion at the Exchange Ratio provided for in
the Merger Agreement of shares of the common stock, no par value, of Summit
("Summit Common Stock") outstanding at the Effective Time (as defined in the
Merger Agreement) into whole shares of the Common Stock, par value $1.20 per
share, of UJB (the "UJB Common Stock") and cash in lieu of fractional shares of
UJB Common Stock, and (iii) and the conversion of each share of $25 stated value
Adjustable Rate Cumulative Preferred Stock of Summit ("Summit Preferred Stock")
into one share of $25 stated value Adjustable Rate Cumulative Preferred Stock of
UJB ("UJB Preferred Stock"). Summit Common Stock and Summit Preferred Stock are
referred to collectively herein as the "Summit Stock", and UJB Common Stock and
UJB Preferred Stock are referred to collectively herein as the "UJB Stock".
Shares of Summit Common Stock owned solely or jointly by me, by a relative
sharing the same household as me, or by an entity I control, whether such shares
are owned directly (of record) or indirectly (through a bank, broker or other
nominee), and any other shares of Summit.
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Common Stock over which I or such other persons or entities hold investment or
voting powers, either alone or with others, are referred to collectively herein
as the "Summit Common Shares". Shares of UJB Common Stock to be received in
exchange for the Summit Common Shares, together with any other shares of UJB
Common Stock owned solely or jointly after the time of the Merger by me, by a
relative sharing the same household as me, or by an entity I control, whether
such shares are owned directly or indirectly, and any other shares of UJB Common
Stock over which I or such persons or entities hold investment or voting powers,
either alone or with others, are referred to collectively herein as the "UJB
Common Shares".
Shares of Summit Preferred Stock owned solely or jointly by me, by a
relative sharing the same household as me, or by an entity I control, whether
such shares are owned directly or indirectly, and any other shares of Summit
Preferred Stock over which I or such persons or entities hold investment or
voting powers, either alone or with others, are referred to collectively herein
as the "Summit Preferred Shares". Shares of UJB Preferred Stock to be received
in exchange for the Summit Preferred Shares, together with any other shares of
UJB Preferred Stock owned solely or jointly after the time of the Merger by me,
by a relative sharing the same household as me, or by an entity I control,
whether such shares are owned directly or indirectly, and any other shares of
UJB Preferred Stock over which I or such persons or entities hold investment or
voting powers, either alone or with others, are referred to collectively herein
as the "UJB Preferred Shares".
Summit Common Shares and Summit Preferred Shares are sometimes referred to
collectively herein as the "Summit Shares", and UJB Common Shares and UJB
Preferred Shares are sometimes collectively referred to herein as the "UJB
Shares".
I have been advised that, in the opinion of counsel, I may be deemed to be,
at the time the Merger is submitted for a vote of the shareholders of Summit, an
"affiliate" of Summit as that term is defined for purposes of paragraphs (c) and
(d) of Rule 145 of the Rules and Regulations (the "Rules and Regulations") of
the Securities and Exchange Commission (the "SEC") under the Securities Act of
1933, as amended (the "Act") and that the Merger Agreement requires that persons
so characterized make the representations, warranties and covenants below as a
condition to UJB and Summit closing the Merger.
Capitalized terms used herein but not specifically defined herein shall
have the meaning ascribed to them in the Merger Agreement.
I represent, warrant and covenant that:
A. I will not make or permit any sale, transfer or other disposition of the
UJB Shares, or make or permit any offer to sell, transfer or otherwise dispose
of the UJB Shares, in violation of the Act or the Rules and Regulations.
B. I have been advised that the issuance of the UJB Shares pursuant to the
Merger has been registered with the SEC under the Act under a registration
statement. However, I have also been advised that a distribution of the UJB
Shares has not been registered under the Act and that, because I may be deemed
to be, at the time the Merger is submitted for a vote of the shareholders of
Summit, an "affiliate" of Summit, I may not make or permit any sale,
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transfer or other disposition of any of the UJB Shares issued pursuant to the
Merger, or make or permit any offer to sell, transfer or otherwise dispose of
any of such UJB Shares unless and until (i) an offer and sale of such UJB Shares
has been registered under the Act, (ii) such disposition of such UJB Shares is
made in conformity with Rule 145 under the Act, or (iii) an exemption from
registration, in the opinion of counsel acceptable to UJB, is available with
respect to such disposition of such UJB Shares. In the event of a transfer of
UJB Shares permitted by this Agreement, I agree that I will obtain, and deliver
to you a copy of, an agreement substantially similar to this Agreement from each
transferee of the UJB Shares who, in the opinion of counsel acceptable to UJB,
may not under the Act dispose of the UJB Shares so transferred without
registration under the Act.
C. I understand that UJB is under no obligation to register the sale,
transfer or other disposition of the UJB Shares or to take any other action
necessary in order to make compliance with an exemption from registration
available.
D. I understand that stop transfer instructions will be given to UJB's
transfer agent with respect to the UJB Shares and that there will be placed on
the certificates for such UJB Shares, or any substitutions therefor, a legend
stating in substance:
The shares represented by this certificate were issued in a transaction to
which Rule 145 promulgated under the Securities Act of 1933 applies. The
shares represented by this certificate may not be sold, transferred, or
otherwise disposed of unless pursuant to (i) an effective registration
statement under the Securities Act of 1933, (ii) Rule 145 or (iii) an
exemption from registration under the said Act which is available in the
opinion of counsel acceptable to UJB Financial Corp.
The legend set forth above and any similar legend placed on any share
certificate issued upon the transfer of any of the UJB Shares will be
removed by delivery of substitute certificates without such legend if the
undersigned, or any person who acquired, directly or indirectly, such UJB
Shares, shall have delivered to UJB a copy of a letter from the staff of
the SEC, or an opinion of counsel acceptable to UJB, to the effect that the
restrictions on sale, transfer or other disposition referred to in this
letter are no longer necessary under the Act or otherwise in order to
effect such sale, transfer or other disposition pursuant to law.
E. I agree that in addition to the restrictions on sale, transfer and other
disposition of the UJB Shares set forth in paragraphs A and B above, I will not
make or permit after the Effective Time any public or private sale, transfer,
assignment or other disposition of any UJB Common Shares, or enter into or
permit any transactions with would reduce the market risk (as such term is
defined in Section 201 of the SEC's Codification of Financial Reporting
Policies) of ownership of the UJB Common Shares, until UJB shall have published
consolidated financial results including the combined operations of UJB and
Summit for a period of at least 30 days following the Effective Time. In
addition, I agree that, (a) prior to such time as Summit shall have received the
Closing Notice, I shall not make or permit any sale, transfer, or other
disposition of any Summit Common Shares, or enter into or permit any
transactions which would reduce the market risk of ownership of the Summit
Common Shares, unless I first give UJB notice of such sale, transfer,
disposition or risk-reducing transaction and UJB does not within five business
days of receipt of such notice object to such transaction on the grounds
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that it is inconsistent with accounting for the Merger as a pooling of
interests, and (b) after such time as Summit shall have received the notice from
UJB fixing the Closing Date under the Merger Agreement (the "Closing Notice"), I
shall not make or permit any sale, transfer, or other disposition of any Summit
Common Shares, or enter into or permit any transactions which would reduce the
market risk of ownership of the Summit Common Shares, if such sale, transfer,
disposition or risk-reducing transaction would occur 30 or fewer days before the
date of Closing specified in the Closing Notice.
F. UJB agrees, by accepting this letter, (a) that for a period of three
years after the Effective Time and thereafter until three months after I have
ceased to be an affiliate of UJB and so long as UJB has equity securities
registered pursuant to Section 12 of the Securities Exchange Act of 1934, as
amended, UJB will make available with respect to itself "adequate current public
information" as defined in paragraph (c) of Rule 144 of the Rules and
Regulations under the Act, and (b) that it will publish financial results
including at least a calendar month of not less than 30 days of post-merger
combined operations promptly following the first full calendar month following
the Closing and which shall be in accordance with Section 201.01 of the SEC's
Codification of Financial Reporting Policies, and UJB shall file a From 8-K for
this purpose if necessary.
I have carefully read this letter and, to the extent I felt necessary,
discussed with my counsel the requirements of this letter and its impact upon
the ability to dispose of the Summit Shares and the UJB Shares.
Accepted this____day of__________, 199__ Very truly yours,
by UJB Financial Corp.
______________________________
By:_______________________________ Signature
Name:_____________________________ ______________________________
Printed Name
Title:____________________________ Dated as of____________, 199__
Address for any Objection sent
pursuant to Paragraph E:
______________________
__________________________________
__________________________________
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Exhibit D to the Ageement
and Plan of Merger
FORM OF OPINION OF SUMMIT COUNSEL
PURSUANT TO SECTION 7.05
UJB Financial Corp.
301 Carnegie Center
Princeton, New Jersey 08543-2066
Gentlemen:
This opinion is rendered to you pursuant to Section 7.05 of the Agreement
and Plan of Merger, dated September 10, 1995 (the "Merger Agreement"), between
The Summit Bancorporation ("Summit" or the "Company") and UJB Financial Corp.
("UJB"), which Merger Agreement provides, among other things, (i) for the merger
(the "Merger") of Summit with and into UJB, (ii) the issuance, in accordance
with the Exchange Ratio provided for in the Merger Agreement, of whole shares of
the Common Stock, par value $1.20 per share, of UJB (the "UJB Common Stock") and
cash in lieu of fractional shares of UJB Common Stock in exchange for
outstanding shares of the Common Stock, no par value, of Summit (the "Summit
Common Stock"), and (iii) the exchange of one share of $25 stated value
Adjustable Rate Cumulative Preferred Stock of UJB the ("UJB Cumulative Preferred
Stock") for each outstanding share of $25 stated value Adjustable Rate
Cumulative Preferred Stock of Summit (the "Summit Cumulative Preferred Stock").
In consideration of the Merger Agreement, Summit and UJB entered into a Stock
Option Agreement dated September 11, 1995 pursuant to which, among other things,
Summit granted UJB a stock option with respect to shares of Summit Common (the
"Summit Option Agreement") and a Stock Option Agreement dated September 11, 1995
pursuant to which, among other things, UJB granted Summit a stock option with
respect to shares of UJB Common (the "UJB Option Agreement") (collectively, the
"Option Agreements").
Capitalized terms used but not defined herein shall have the same meanings
herein as ascribed to them in the Merger Agreement.
I am Senior Vice President, General Counsel and Corporate Secretary of the
Company and in such capacity have acted as counsel to the Company in connection
with the preparation, authorization, execution and delivery of the Merger
Agreement and the Option Agreements and the consummation of the transactions
contemplated by the Merger Agreement, including the preparation of the
registration statement, as amended (the "Registration Statement"), under the
Securities Act of 1933, as amended (the "Securities Act"), on Form S-4 of UJB
(No. 33-_______), and the proxy statement of Summit included in the Registration
Statement (the "Summit Proxy Statement").
In so acting, I have made inquiries of certain of the officers and
representatives of the Company and its subsidiaries with respect to various
matters contained in the Merger Agreement,
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the Option Agreements and the Registration Statement, and have examined and
relied upon originals or copies certified or otherwise identified to my
satisfaction of the Merger Agreement, the Option Agreements and such corporate
records, agreements, documents and other instruments, and such certificates or
the comparable documents of public officials and of such directors, officers and
representatives of the Company and its subsidiaries as I have deemed relevant
and necessary as a basis for the opinions hereinafter set forth.
In such examination, I have assumed, without independent verification, the
genuineness and authenticity of all signatures, the authenticity of all
documents submitted to me as originals, the legal capacity of all natural
persons and the conformity to original documents of documents submitted to me as
certified or facsimile or photostatic copies and the authenticity of the
originals of facsimile or photostatic copies. As to all questions of fact
material to this opinion that have not been independently established, I have
relied upon certificates or comparable documents of officers and representatives
of the Company and upon the representations and warranties of the Company
contained in the Merger Agreement. I have also assumed, without independent
verification, the due authorization, execution, and delivery (other than the due
authorization, execution and delivery by the Company) of all documents, the due
authorization, execution and delivery of which are prerequisites to the
effectiveness of such documents, and that such documents constitute legal, valid
and binding obligations of the parties thereto (other than the Company).
Based on the foregoing, and subject to the qualifications stated herein, I
am of the opinion that:
1. The Company has been duly organized and is validly existing as a
corporation in good standing under the laws of the State of New Jersey and has
all requisite corporate power and authority to own, lease and operate its
properties and to carry on its business as now being conducted, as described in
the Registration Statement.
2. The Company is duly qualified to transact business as a foreign
corporation and is in good standing in each jurisdiction where the failure to be
so qualified cannot be cured and such failure would have a material adverse
effect on the business, operations or financial condition of the Company and its
subsidiaries taken as a whole.
3. The Company is registered as a bank holding company under the Bank
Holding Company Act of 1956, as amended.
4. (a) The authorized capital stock of Summit consists of 50,000,000 shares
of Common Stock, each of no par value, and 12,000,000 shares of Preferred Stock,
each of no par value, and as of the date of the Merger Agreement:
(1) 33,820,043 shares of Summit Common Stock were outstanding and 504,000
shares of Summit Preferred were outstanding,
(2) 7,793,505 shares of Summit Common Stock were reserved for issuance in
connection with the Summit Stock Plans. No other shares of Summit
Common Stock were reserved for issuance;
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(3) 250,000 shares of Series B Junior Participating Preferred Stock, no par
value (the "Summit Series B Preferred Stock"), were reserved for
issuance in connection with the Summit Rights Agreement. No other
shares of Summit Preferred Stock were reserved for issuance; and
(4) 84,485 shares of Summit Common Stock were held by Summit in its
treasury as issued but not outstanding Summit Common Stock.
(b) All of the outstanding shares of capital stock of the Company are duly
authorized, validly issued, and non-assessable, with no personal liability
attaching to the ownership thereof, and have not been issued in violation of any
preemptive rights.
(c) Since September 10, 1995, no Equity Securities of Summit have been
issued except for the stock option granted to UJB in the Summit Option Agreement
and Summit Common Stock which was reserved for issuance as of such date and
which may have been issued in connection with the Summit Stock Plans and the
Garden State Agreement.
(d) Except as set forth above in 4(a) above, except for the Equity
Securities issued as described in 4(c) above, except for director and employee
stock options outstanding under the Summit Stock Award Plans, except for Summit
Common Stock issuable in connection with the Summit Stock Plans, the Garden
State Agreement and the Summit Option Agreement, and except for the Summit
Series B Preferred Stock issuable in connection with the Summit Rights
Agreement, there are no other Equity Securities of Summit or any subsidiary of
Summit outstanding, in existence, the subject of an agreement or reserved for
issuance.
5. Summit Bank has been duly incorporated and is validly existing as a bank
in good standing under the laws of the state of New Jersey and has all requisite
corporate power and authority to own, lease and operate its properties and to
carry on its business as now being conducted, as described in the Registration
Statement.
Each other subsidiary of the Company has been duly incorporated and is
validly existing as a corporation in good standing under the laws of the state
of New Jersey and has all requisite corporate power and authority to own, lease
and operate its properties and to carry on its business as now being conducted,
as described in the Registration Statement.
6. Summit Bank is an insured bank under the Federal Deposit Insurance Act,
as amended.
7. All the outstanding capital stock of each subsidiary of the Company has
been duly authorized and validly issued and is fully paid and non-assessable,
with no personal liability attached to the ownership thereof, has not been
issued in violation of any preemptive rights, is owned by the Company. As of the
date hereof, no options covering capital stock of any subsidiary of the Company,
warrants to purchase or contracts to issue capital stock of any subsidiary of
the Company, or any other contracts, rights (including preemptive rights),
commitments or convertible securities entitling anyone to acquire from the
Company or any subsidiary of the Company or obligating any of them to issue any
capital stock, or securities convertible into or exchangeable for any shares of
capital stock thereof, are outstanding, in existence, or the subject of an
agreement. The Company owns the capital stock of each subsidiary of the Company
free
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and clear of any perfected security interest and, to the extent of my
knowledge and information, any other security interest, lien, claim, limitation
on voting rights, option, or other encumbrance.
8. To the extent of my knowledge and information, there are no outstanding
contractual obligations of the Company or any subsidiary to repurchase, redeem,
or otherwise acquire any outstanding shares of capital stock or other ownership
interests of any subsidiary of the Company or to provide funds or to make any
investment (in the form of a loan, capital contribution or otherwise), in any
subsidiary or any other entity.
9. The Company has the corporate power and authority to enter into the
Merger Agreement and the Option Agreements and to carry out the transactions
contemplated thereby; the Merger Agreement and the Option Agreements have been
validly authorized, executed and delivered by the Company; the consummation of
the transactions contemplated by the Merger Agreement, including the Merger, and
the Option Agreements have each been duly authorized by all necessary corporate
action on the part of the Company and its shareholders and (assuming the due
authorization, execution and delivery thereof by UJB) the Merger Agreement and
the Option Agreements each constitute a valid and binding agreement of the
Company. No class vote by the holders of the Summit Cumulative Preferred Stock
is required by the New Jersey Act or the Restated Certificate of Incorporation
or By-Laws of Summit with respect to the Merger Agreement or the Option
Agreements, the performance thereof or the transactions contemplated thereby or
the consummation of the Merger.
10. The execution and delivery of the Merger Agreement and the Option
Agreements and the performance thereof by the Company and the consummation of
the Merger did not and will not violate, fail to comply with, conflict with,
give rise to rights under, result in the breach of, or constitute a default
under, give rise to a claim or right of termination, cancellation, revocation of
or acceleration under, or result in the creation or imposition of any lien,
charge or encumbrance upon any of the rights, permits licenses, assets or
properties material to the Company and its subsidiaries taken as a whole, or any
of its subsidiaries, or upon any of the capital stock of the Company or any of
its subsidiaries, or constitute an event that could, with the lapse of time,
action or inaction by the Company or any of its subsidiaries or a third party,
or the giving of notice and failure to cure, result in any of the foregoing,
under any of the terms, conditions or provisions, as the case may be, of: (a)
the Restated Certificate of Incorporation, By-laws or Shareholder Rights Plan of
the Company, (b) any federal law of the United States of America or any law of
the State of New Jersey, (c) any rule, ruling, determination, ordinance or
regulation of or agreement with any governmental or regulatory authority, (d) to
the extent of my knowledge and information, any judgment, order, writ, award,
injunction or decree of any court or governmental authority issued in any
proceeding to which the Company or any of its subsidiaries is or was a party or
by which the Company or any of its subsidiaries or any of their assets or
properties are bound or committed, or (e) to the extent of my knowledge and
information, any material note, bond, mortgage, indenture, lease, policy of
insurance or indemnity, license, contract, agreement or other instrument to
which the Company or any of its subsidiaries is a party or by which it or any of
its subsidiaries or any of their assets or properties are bound or committed,
other than any such violations, conflicts, breaches, defaults or accelerations
the consequences of which do not or will not, in the aggregate, have a material
adverse effect on the business, operations or financial condition of the Company
and its subsidiaries, taken as a whole, or enable any person to enjoin the
transactions contemplated by the Merger Agreement. No consent, approval, waiver,
license or
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authorization or other action by or filing with any federal or New Jersey
governmental authority is required in connection with the execution and
delivery by the Company of the Merger Agreement or Option Agreements or the
consummation by the Company of the transactions contemplated thereby, including
the Merger, except for (i) the filing of the Certificate of Merger as provided
by the Merger Agreement, (ii) such filings and other actions as may be required
by federal or state securities laws and the rules and regulations thereunder,
and (iii) those already obtained.
11. To the extent of my knowledge and information, there is no litigation,
proceeding or governmental investigation pending or overtly threatened against
the Company that relates to any of the transactions contemplated by the Merger
Agreement or is material to the financial condition of Summit and its
subsidiaries, taken as a whole.
12. To the extent of my knowledge and information, there are no persons who
may be deemed to be affiliates of the Company for purposes of Rule 145 under the
Securities Act, who may receive shares of UJB Common Stock or UJB Cumulative
Preferred Stock in the Merger and who are not named on the letter from me
delivered by the Company to UJB pursuant to Section 4.11 of the Merger
Agreement.
13. The Summit Proxy Statement (except for the financial statements and the
notes thereto, the financial statement schedules and the other financial,
statistical and accounting data included, incorporated by reference or deemed
incorporated by reference in the Summit Proxy Statement, as to which I express
no opinion), but only insofar as the Company and its business, the Merger
Agreement and the transactions contemplated thereby, including the Merger, and
the Option Agreements are described in the Summit Proxy Statement, complies as
to form in all material respects with the requirements of the Securities Act and
the rules and regulations thereunder and the documents incorporated by reference
in the Registration Statement pursuant to Part I.C. of Form S-4 under the
Securities Act (except for the financial statements and the notes thereto and
the financial statement schedules and other financial, statistical and
accounting data included, incorporated by reference or deemed incorporated by
reference, as to which I express no opinion) when filed with the Securities and
Exchange Commission complied as to form in all material respects with the
Securities Exchange Act of 1934, as amended, and the applicable rules and
regulations thereunder.
I have participated in conferences with officers and other representatives
of the Company and UJB, representatives of the independent public accountants
for the Company and UJB and counsel for UJB, at which conferences the contents
of the Registration Statement and the Summit Proxy Statement and related matters
were discussed, and, although I have not independently verified and am not
passing upon and assume no responsibility for the accuracy, completeness or
fairness of the statements contained in the Registration Statement and the
Summit Proxy Statement, no facts have come to my attention that lead me to
believe that the Registration Statement, on the effective date thereof, insofar
as the Company and its business, the Merger Agreement and the transactions
contemplated thereby,
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including the Merger, and the Option Agreements are described therein, contained
or contains an untrue statement of a material fact or omitted or omits to state
a material fact required to be stated therein or necessary in order to make the
statements contained therein, in light of the circumstances under which they
were made, not misleading (it being understood that I express no view with
respect to the financial statements and related notes, the financial statement
schedules and the other financial, statistical and accounting data included,
incorporated by reference or deemed incorporated by reference in the
Registration Statement or the Summit Proxy Statement). Please be advised that,
where any statement is stated herein as being "to the extent of my knowledge and
information," I have not independently verified the accuracy of such statement
but intend to advise you that in the course of my duties as Senior Vice
President, General Counsel and Secretary of the Company and, in particular, my
participation in the preparation, authorization, execution and delivery of the
Merger Agreement and the Option Agreements and in the preparation of the
Registration Statement and the Summit Proxy Statement, nothing has come to my
attention that leads me to believe, and I do not believe, that the matter is
other than as stated herein. In addition, please be advised that my opinion with
respect to the valid and binding nature of the Merger Agreement and the Option
Agreements is subject to applicable bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance, fraudulent transfer and similar laws
presently or hereafter in effect affecting the enforcement of creditors' rights
and remedies generally, the discretion of a court in ordering specific
performance or other equitable remedies, and to general principles of equity
(regardless of whether questioned in a proceeding at law or in equity).
The opinions herein are limited to the federal laws of the United States
and the laws of the State of New Jersey, and I express no opinion as to the
effect on any matter covered by this opinion of the laws of any other
jurisdiction.
This opinion is being furnished to, and is solely for the benefit of, UJB
and is not to be quoted, used, circulated, published or disseminated, otherwise
referred to in any documents, filed with any governmental agency, entity or
person, or relied upon by any agency, entity or person other than UJB, without
my prior written consent.
Very truly yours,
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Exhibit E to the Agreement
and Plan of Merger
OPINION OF UJB COUNSEL
PURSUANT TO SECTION 8.05
The Summit Bancorporation
One Main Street
Chatham, New Jersey 07928
Gentlemen:
This opinion is rendered to you pursuant to Section 8.05 of the Agreement
and Plan of Merger, dated September 10, 1995 (the "Merger Agreement"), between
The Summit Bancorporation ("Summit") and UJB Financial Corp. ("UJB" or the
"Company"), which Merger Agreement provides, among other things, (i) for the
merger (the "Merger") of Summit with and into UJB, (ii) the issuance, in
accordance with the Exchange Ratio provided for in the Merger Agreement, of
whole shares of the Common Stock, par value $1.20 per share, of UJB (the "UJB
Common Stock") and cash in lieu of fractional shares of UJB Common Stock in
exchange for outstanding shares of the Common Stock, no par value, of Summit
(the "Summit Common Stock"), and (iii) the exchange of one share of $25 stated
value Adjustable Rate Cumulative Preferred Stock of UJB the ("UJB Cumulative
Preferred Stock") for each outstanding share of $25 stated value Adjustable Rate
Cumulative Preferred Stock of Summit (the "Summit Cumulative Preferred Stock").
In consideration of the Merger Agreement, Summit and UJB entered into a Stock
Option Agreement dated September 11, 1995 pursuant to which, among other things,
Summit granted UJB a stock option with respect to shares of Summit Common (the
"Summit Option Agreement") and a Stock Option Agreement dated September 11, 1995
pursuant to which, among other things, UJB granted Summit a stock option with
respect to shares of UJB Common (the "UJB Option Agreement") (collectively, the
"Option Agreements").
Capitalized terms used but not defined herein shall have the same meanings
herein as ascribed to them in the Merger Agreement. As used herein, it is
intended that "material" be determined with reference to UJB and its
subsidiaries considered as one enterprise.
I am Executive Vice President, General Counsel and Secretary of the Company
and have served as counsel to the Company in connection with the preparation,
authorization, execution and delivery of the Merger Agreement, the Option
Agreements and the consummation of the transactions contemplated thereby,
including the preparation of the registration statement, as amended, under the
Securities Act of 1933, as amended (the "Securities Act"), on Form S-4 of UJB
(No. 33-_____), and the prospectus and the proxy statement of UJB included
therein (the registration statement, together with the prospectus and proxy
statement of UJB included therein, are referred to collectively as the
"Registration Statement").
In so acting, I have made inquiries of certain of the officers and
representatives of the Company and its subsidiaries with respect to various
matters contained in the Merger
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Agreement, the Option Agreements and the Registration Statement, and have
examined and relied upon originals or copies certified or otherwise identified
to my satisfaction of the Merger Agreement, the Options Agreements and such
corporate records, agreements, documents and other instruments, and such
certificates or comparable documents of the public officials and of such
directors, officers and representatives of the Company and its subsidiaries as I
have deemed relevant and necessary as a basis for the opinions hereinafter set
forth.
In such examination I have assumed, without independent verification, the
genuineness and authenticity of all signatures, the authenticity of all
documents submitted to me as originals, the legal capacity of all natural
persons and the conformity to original documents of documents submitted to me as
certified or facsimile or photostatic copies and the authenticity of the
originals of facsimile or photostatic copies. As to all questions of fact
material to this opinion that have not been independently established, I have
relied upon certificates or comparable documents of officers and representatives
of the Company and upon the representations and warranties of the Company
contained in the Merger Agreement. I have also assumed, without independent
verification, the due authorization, execution and delivery (other than due
authorization, execution and delivery by the Company) of all documents, the due
authorization, execution and delivery of which are prerequisites to the
effectiveness of such documents, and that such documents constitute legal, valid
and binding obligations of the parties thereto (other than the Company).
Based on the foregoing and subject to the qualifications stated herein, I
am of the opinion that:
1. Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of New Jersey and has
all requisite corporate power and authority to own, lease and operate its
properties and to carry on its business as now being conducted, as described in
the Registration Statement.
2. The Company is duly qualified to transact business as a foreign
corporation and is in good standing in each jurisdiction where the failure to be
so qualified cannot be cured and such failure would have a material adverse
effect on the Company and its subsidiaries taken as a whole.
3. The Company is duly registered as a bank holding company under the Bank
Holding Company Act of 1956, as amended.
4. The authorized capital stock of the Company consists of 4,000,000 shares
of Preferred Stock, without par value, and 130,000,000 shares of Common Stock,
par value $1.20 per share, and, as of the date of the Merger Agreement, 600,166
shares of Series B Adjustable Rate Cumulative Preferred Stock of the Company
were outstanding and 600,000 shares of Series R Preferred Stock were reserved
for issuance pursuant to UJB's Shareholder Rights Plan, and, as of September 10,
1995, 57,561,452 shares of UJB Common Stock were outstanding and 8,638,483
shares of UJB Common Stock were reserved for issuance pursuant to UJB's Dividend
Reinvestment and Stock Purchase Plan, Savings Incentive Plan, employee stock
option and performance stock plans and the Flemington Agreement. Since September
10, 1995, no shares of the Preferred Stock of UJB have been issued and no shares
of UJB Common Stock have been
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issued, other than shares of UJB Common Stock which were reserved for issuance
as of such date, and which may have been issued, pursuant to UJB's Dividend
Reinvestment and Stock Purchase, Savings Incentive Plan, employee stock option
or stock performance plans or the Flemington Agreement. As of the date hereof,
no options (excluding board of trade or exchange traded standardized options)
covering capital stock of the Company, warrants to purchase or contracts to
issue capital stock of the Company or any other contracts, rights (including
preemptive rights), commitments or convertible securities entitling anyone to
acquire from the Company or obligating either to issue any capital stock, or
securities convertible into or exchangeable for any shares of its capital stock,
are outstanding, in existence or the subject of an agreement, other than the
stock option outstanding under the UJB Option Agreement, the employee stock
options outstanding under UJB's employee stock option plans, the commitments to
issue UJB Common Stock contained in the UJB Option Agreement, the Merger
Agreement, the Flemington Agreement and the outstanding stock options under
UJB's stock option plans, the commitment to issue UJB Cumulative Preferred Stock
contained in the Merger Agreement and the commitment to issue Series R Preferred
Stock of the Company contained in the UJB Shareholder Rights Plan. All of the
outstanding shares of capital stock of the Company are duly authorized, validly
issued, and non-assessable, with no personal liability attaching to the
ownership thereof, and have not been issued in violation of any preemptive
rights.
5. Each of United Jersey Bank and First Valley Bank has been duly
incorporated and is validly existing as a bank in good standing under the laws
of, respectively, the State of New Jersey or the Commonwealth of Pennsylvania,
and has all requisite corporate power and authority to own, lease and operate
its properties and to carry on its business as now being conducted, as described
in the Registration Statement.
6. Each of United Jersey Bank and First Valley Bank is an insured bank
under the Federal Deposit Insurance Act, as amended.
7. All the issued and outstanding capital stock of each of United Jersey
Bank and First Valley Bank has been duly and validly issued and is fully paid
and nonassessable and, to the extent of my knowledge and information, the
Company owns, directly or indirectly, all such capital stock, and as of the date
hereof no options covering capital stock of any UJB bank subsidiary, warrants to
purchase or contracts to issue capital stock of any UJB bank subsidiary, or any
other contracts, rights (including preemptive rights), commitments or
convertible securities entitling anyone to acquire from any UJB bank subsidiary
or obligating it to issue any capital stock, or securities convertible into or
exchangeable for any shares of capital stock of any UJB bank subsidiary, are
outstanding, in existence, or the subject of an agreement. Such stock is owned
free and clear of any perfected security interest and, to the extent of my
knowledge and information, any other security interest.
8. The Company has the corporate power and authority to enter into the
Merger Agreement and the Option Agreements and to carry out the transactions
contemplated thereby; the Merger Agreement and the Option Agreements have been
validly authorized, executed and delivered by the Company; the consummation of
the transactions contemplated by the Merger Agreement, including the Merger, and
the Option Agreements have each been duly authorized by all necessary corporate
action on the part of the Company and (assuming the due authorization,
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execution and delivery thereof by Summit) the Merger Agreement and the Option
Agreements each constitute the valid and binding agreement of the Company.
9. The execution and delivery of the Merger Agreement and the Option
Agreements and the performance thereof by the Company and the consummation of
the Merger did not and will not violate, fail to comply with, conflict with,
give rise to rights under, result in the breach of, or constitute a default
under, give rise to a claim or right of termination, cancellation, revocation of
or acceleration under, or result in the creation or imposition of any lien,
charge or encumbrance upon any rights, permits, licenses, assets or properties
material to the Company and its subsidiaries, taken as a whole, or upon any of
the capital stock of the Company or constitute an event that could, with the
lapse of time, action or inaction by the Company or a third party, or the giving
of notice and failure to cure, result in any of the foregoing, under any of the
terms, conditions or provisions, as the case may be, of (a) the Restated
Certificate of Incorporation, By-Laws or Shareholder Rights Plan of the Company,
(b) any federal law of the United States of America or any law of the State of
New Jersey or the Commonwealth of Pennsylvania, (c) any rule, ruling,
determination, ordinance or regulation of or agreement with any governmental or
regulatory authority, (d) to the extent of my knowledge and information, any
judgment, order, writ, award, injunction or decree of any court or governmental
authority issued in any proceeding to which the Company is a party or by which
the Company or any of their assets or properties are bound or committed, or (e)
to the extent of my knowledge and information, any material note, bond,
mortgage, indenture, lease, policy of insurance or indemnity, license, contract,
agreement or other instrument to which the Company is a party or by which either
of them or any of their assets or properties are bound or committed, other than
any such violations, conflicts, breaches, defaults or accelerations the
consequences of which do not or will not, in the aggregate, have a material
adverse effect on the Company and its subsidiaries, taken as a whole, or enable
any person to enjoin the transactions contemplated by the Merger Agreement or
the Option Agreements. No consent, approval, waiver, license or authorization or
other action by or filing with any federal or New Jersey or Pennsylvania
governmental authority is required in connection with the execution and delivery
by the Company of the Merger Agreement or Option Agreements or the consummation
by the Company of the transactions contemplated thereby, including the Merger,
except for (i) the filing of the Merger Agreement, the Option Agreements and
related certifications as provided by the Merger Agreement and the Option
Agreement with the New Jersey Department of Banking, (ii) such filings and other
actions as may be required by federal or state securities laws and the rules and
regulations thereunder, and (iii) those already obtained.
10. The UJB Common Stock and UJB Cumulative Preferred Stock to be issued
pursuant to the Merger Agreement has been duly authorized for issuance pursuant
to the Merger Agreement and, when issued and delivered by the Company pursuant
to the Merger Agreement, will be validly issued, fully paid and nonassessable.
The issuance of the UJB Common Stock and UJB Cumulative Preferred Stock under
the Merger Agreement is not subject to any preemptive rights under the Company's
Restated Certificate of Incorporation or By-Laws or, to the extent of my
knowledge and information, any agreement by which the Company is bound.
11. The Registration Statement is effective under the Securities Act and,
to the extent of my knowledge and information, no stop order suspending the
effectiveness of the Registration
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Statement has been issued under the Securities Act or proceedings therefor
initiated or threatened by the Securities and Exchange Commission.
12. The Registration Statement (except for the financial statements and the
notes thereto, the financial statement schedules and the other financial,
statistical and accounting data included, incorporated by reference or deemed
incorporated by reference in the Registration Statement, as to which I express
no opinion) but only insofar as the Company and its business and the Merger
Agreement, the Option Agreements and the transactions contemplated thereby,
including the Merger, are described therein, comply as to form in all material
respects with the requirements of the Securities Act and the rules and
regulations thereunder. The documents filed by UJB with the Securities and
Exchange Commission (the "Commission") and incorporated by reference in the
Registration Statement pursuant to Part I.B. of Form S-4 under the Securities
Act (except for the financial statements and the notes thereto and the financial
statement schedules and other financial, statistical and accounting data
included, incorporated by reference or deemed incorporated by reference, as to
which I express no opinion) when filed with the Commission complied as to form
in all material respects with the Securities Exchange Act of 1934, as amended,
and the rules and regulations thereunder.
I have participated in conferences with officers and other representatives
of the Company and Summit, representatives of the independent public accountants
for the Company and Summit and counsel for Summit, at which conferences the
contents of the Registration Statement and related matters were discussed, and,
although I have not independently verified and am not passing upon and assume no
responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement, no facts have come to my attention that
lead me to believe that the Registration Statement, on the effective date
thereof contained, or on the date hereof contains, insofar as the Company and
its business and the Merger Agreement, the Option Agreements and the
transactions contemplated thereby, including the Merger, are described therein,
an untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the statements
contained therein, in light of the circumstances under which they were made, not
misleading (it being understood that I express no view with respect to the
financial statements and related notes, the financial statement schedules and
the other financial, statistical and accounting data included, incorporated by
reference or deemed incorporated by reference in the Registration Statement).
Please be advised that, where any statement is stated herein as being "to
the extent of my knowledge and information," I have not independently verified
the accuracy of such statement but intend to advise you that in the course of my
duties as Executive Vice President, General Counsel and Secretary of the Company
and, in particular, my participation in the preparation, authorization,
execution and delivery of the Merger Agreement and the Option Agreements and in
the preparation of the Registration Statement, nothing has come to my attention
that leads me to believe, and I do not believe, that the matter is other than as
stated herein. In addition, please be advised that my opinion with respect to
the valid and binding nature of the Merger Agreement and the Option Agreements
is subject to applicable bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance, fraudulent transfer and similar laws presently or
hereafter in effect affecting the enforcement of creditors' rights and remedies
generally, the discretion of a court in ordering specific performance or other
equitable remedies,
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and to general principles of equity (regardless of whether questioned in a
proceeding at law or in equity).
The opinions herein are limited to the federal laws of the United States
and the laws of the State of New Jersey and the Commonwealth of Pennsylvania,
and I express no opinion as to the effect on any matter covered by this opinion
of the laws of any other jurisdiction.
This opinion is not to be quoted or otherwise referred to in any documents
or filed with any governmental agency, entity or person or relied upon by any
agency, entity or person other than the addressee, without my prior written
consent.
Very truly yours,
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Exhibit F to the Agreement
and Plan of Merger
EMPLOYMENT AGREEMENT
This Agreement made this _____ day of____________, 1996, by and among
Summit Bank Corp. (formerly known as UJB Financial Corp. and successor to The
Summit Bancorporation), a New Jersey corporation ("Summit") and Robert G. Cox,
(the "Executive").
WHEREAS, the Board of Directors of Summit believes that the services of the
Executive in the future will be valuable to Summit and is desirous of retaining
the Executive's services for a period of not less than three years, and the
Executive has indicated his willingness to enter into an employment agreement
upon the terms and conditions hereinafter set forth;
WHEREAS, Section 8.08 of the Agreement and Plan of Merger dated September
10, 1995 ("Merger Agreement") among The Summit Bancorporation, a New Jersey
corporation, and UJB Financial Corp., Summit's predecessor, contemplates that,
in connection with the merger (the "Merger") provided for in the Merger
Agreement, the Executive shall enter into an employment agreement with Summit at
the time of closing of the Merger if he shall be ready, willing and able to
perform the services to be rendered by him thereunder; and
WHEREAS, Executive and The Summit Bancorporation have entered into an
agreement dated as of September 1, 1995 (the "Summit Agreement") which Agreement
remains in full force and effect and is hereby assumed by Summit, certain
Sections of which are incorporated herein by reference, as hereinafter stated,
including the definitions found at Sections 1.1 through 1.9 (it being
acknowledged that a Potential Change of Control occurred when the Merger
Agreement was executed on September 10, 1995 and a Change of Control will take
place prior to execution of this Agreement). That Potential Change of Control
and that Change of Control are together referred to herein as the Summit-UJB
Change. Capitalized terms used in this Agreement and not defined herein but
defined in the Summit Agreement shall have the meanings assigned thereto in the
Summit Agreement.
NOW, THEREFORE, in consideration of the premises and mutual promises herein
contained, the parties hereto agree as follows:
1. Term. Summit agrees to employ the Executive as President of Summit and
its principal subsidiary bank (the "Bank") and as a member of the Managing
Committees of Summit and its principal subsidiary bank, and the Executive hereby
agrees to serve Summit and the Bank in such capacity, for a period of three
years from the date hereof, provided, however, that on the first and second
anniversary dates of this Agreement, the term of this Agreement shall
automatically be extended for one additional year unless, not later than 180
days prior to such anniversary date, Summit or the Executive shall have given
written notice to the other party of its or his election not to extend this
Agreement.
2. Duties. The Executive shall perform such duties as President as may be
assigned to him from time to time by the Boards of Directors of Summit and the
Bank and the Chairman of the Board and Chief Executive Officer of Summit and as
are appropriate to the position of
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President of a publicly held bank holding company. The Executive agrees to
fulfill such duties in accordance with the Executive's covenants as set forth in
Sections 4.1, 4.2 and 4.3 of the Summit Agreement, which Sections are hereby
incorporated by reference. The Executive expressly gives his written consent
under Sections 1.6 and 3.2 of the Summit Agreement to employment in such
position and duties, and to the basing of Executive at Summit's principal
executive offices (which are currently located at 301 Carnegie Center, Princeton
(West Windsor Township), New Jersey). This consent under Sections 1.6 and 3.2 is
expressly limited to the Summit-UJB Change.
3. Compensation, Compensation Plans. During the Employment Period, the
Executive shall receive Base Salary of not less than $500,000, and Annual Bonus,
Expenses, Fringe Benefits, Office and Support Staff, and Vacation and
participate in Incentive, Savings and Retirement Plans and Welfare Benefit Plans
in accordance with the provisions of Sections 3.3, 3.4, 3.5, 3.6, 3.7, 3.8, 3.9
and 3.10 of the Summit Agreement, which Sections are hereby incorporated by
reference.
4. Resignation or Discharge. Summit shall always have the right to
terminate the employment of the Executive for Cause. In the event Executive's
employment with Summit is terminated prior to the expiration of the term of this
Agreement on account of (i) the Executive's resignation (in contravention of the
terms of this Agreement) or (ii) the Executive's discharge by Summit for Cause,
all compensation payable under Section 3 of this Agreement shall terminate as of
the date of such termination of employment, except for compensation provided by
vested or contractual rights under the Incentive, Savings and Retirement Plans
and Welfare Benefit Plans.
5. Death or Disability. The term of employment of the Executive shall
terminate forthwith in the event of the death of the Executive, or, at the
option of Summit, in the event that the Executive shall fail to render and
perform the services required of him under this Agreement because of Disability.
In the event of such a termination, all compensation payable under Section 3 of
this Agreement, except for compensation provided by vested or contractual rights
under the Incentive, Savings and Retirement Plans and Welfare Benefit Plans or
by statute, shall terminate as of the date of such termination.
6. Restrictive Covenant. The parties recognize that the Executive is an
important officer of Summit, that his reputation and business and personal
relationships are of significant benefit to Summit, and that he has access to
information about Summit's plans and projections as well as other confidential
information. The parties further agree that Summit is in direct competition with
certain banks and bank holding companies and thrifts and the Executive agrees
that upon the termination of the Executive's employment as an executive of
Summit pursuant to Sections 4 and 5, he shall not for a period of twelve months
after such termination accept employment or serve in any capacity with any
national or state bank or a thrift institution or affiliate thereof, other than
Summit or a subsidiary of Summit at a principal place of employment within 25
miles of any branch location of Summit or any of its subsidiaries, without the
written permission of Summit.
7. Offset. Except as set forth in Section 2 hereof, nothing in this
Agreement is intended to terminate, amend, alter or affect any rights Executive
may have under the Summit
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Agreement setting forth benefits to be paid under certain circumstances after a
Change of Control of The Summit Bancorporation; provided, however, that if
Executive receives compensation under the Summit Agreement, such compensation
shall be a credit against any amounts payable hereunder.
8. Legal Costs. Section 6.4 of the Summit Agreement is hereby incorporated
by reference.
9. Termination Procedures and Compensation During Dispute. Sections 7.1
through 7.4 of the Summit Agreement are hereby incorporated by reference.
10. Arbitration. Any controversy, claim, dispute or difference arising out
of the interpretation, construction or performance of this Agreement shall be
settled by arbitration at Newark, New Jersey according to the rules of the
American Arbitration Association, and judgment upon the award rendered in such
arbitration may be entered in any court having jurisdiction thereof.
11. Successors and Assigns, Binding Agreement. Section 9.1 of the Summit
Agreement is hereby incorporated by reference.
Summit hereby assumes all of the obligation of The Summit Bancorporation
under the Summit Agreement. All rights and duties of Summit under this Agreement
shall be binding on and inure to the benefit of Summit, its successors, assigns
or any company which purchases or otherwise acquires Summit or all or
substantially all of its assets by any method. On request of the Executive, any
successor or assignee shall agree in writing to assume and be bound by this
Agreement.
No provision of this Agreement shall be deemed to restrict the absolute
right of Summit at any time to sell or dispose of all or any part of the assets
of Summit, or to reconstitute the same in any one or more other entities or to
merge, consolidate, sell or otherwise dispose of any assets thereof, or to
dissolve or liquidate or otherwise abandon or cease the active conduct of the
business, but none of the foregoing shall relieve Summit of its obligations
hereunder.
12. Notices. All notices, request, demands and other communications
hereunder shall be in writing and shall be deemed to have been duly given if
delivered personally with receipt acknowledged or sent by registered or
certified mail, postage prepaid, to the address shown below, unless changed by
notices given as herein provided:
(a) If to Summit, to:
Summit Bank Corp.
Att.: T. Joseph Semrod
301 Carnegie Center
P.O. Box 2066
Princeton, NJ 08543-2066
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with a copy to:
General Counsel
Summit Bank Corp.
301 Carnegie Center
P.O. Box 2066
Princeton, NJ 08543-2066
(b) If to the Executive, to:
Robert G. Cox
211 Liberty Corner Road
Far Hills, NJ 07931
13. Miscellaneous. Sections 11, 12 and 13 of the Summit Agreement are
hereby incorporated by reference.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
day and year first above written.
CORPORATE SEAL SUMMIT BANK CORP.
Attest: --------------------------- By: ----------------------------
Richard F. Ober, Jr., T. Joseph Semrod
Secretary Chairman of the Board
BY THE EXECUTIVE
- ----------------------------- ---------------------------
Witness: Robert G. Cox
20
EXHIBIT (4)
UJB FINANCIAL CORP. STOCK OPTION AGREEMENT
THE TRANSFER OF THE OPTION GRANTED BY THIS AGREEMENT IS SUBJECT TO RESALE
RESTRICTIONS ARISING UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
STOCK OPTION AGREEMENT, dated as of the 11th day of September, 1995
(this "Agreement"), between The Summit Bancorporation, a New Jersey corporation
("Grantee"), and UJB Financial Corp., a New Jersey corporation ("Issuer").
WITNESSETH:
WHEREAS, Grantee and Issuer have on a date prior to the date hereof,
entered into an Agreement and Plan of Merger, dated as of the 10th day of
September, 1995 (the "Merger Agreement"). (Capitalized terms used in this
Agreement and not defined herein but defined in the Merger Agreement shall have
the meanings assigned thereto in the Merger Agreement); and
WHEREAS, as a condition and inducement to Grantee's entering into the
Merger Agreement and the issuance by Grantee of an option to Issuer on terms and
conditions substantially similar to those of this Agreement, and in
consideration therefor, Grantee has required that Issuer agree, and Issuer has
agreed, to grant Grantee the Option (as defined below);
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements set forth herein and in the Merger Agreement, the
parties hereto agree as follows:
SECTION 1. Grant of Option. Issuer hereby grants to Grantee an
unconditional, irrevocable option (the "Option") to purchase, subject to the
terms hereof, up to 11,450,000 fully paid and nonassessable shares of the common
stock, par value $1.20 per share, of Issuer ("Common Stock") at a price per
share of $36.625 (such price, as adjusted as hereinafter provided, the "Option
Price"). The number of shares of Common Stock that may be received upon the
exercise of the Option and the Option Price are subject to adjustment as herein
set forth. In no event shall the number of shares of Common Stock for which this
Option is exercisable exceed 19.9% of the number of shares of Common Stock then
issued and outstanding (without consideration of any shares of Common Stock
subject to or issued pursuant to the Option).
SECTION 2. Exercise of Option. (a) Grantee may exercise the Option, in
whole or part, at any time and from time to time following the occurrence of a
Purchase Event (as defined below); provided that the Option shall terminate and
be of no further force and effect upon the earliest to occur of (i) the time
immediately prior to the Effective Time, (ii) the termination of the Merger
Agreement in accordance with the terms thereof prior to the occurrence of an
Extension Event, other than a termination of the Merger Agreement by the Grantee
pursuant to Section 9.02(c)(ii) thereof (if the breach by Issuer giving rise to
such right of termination is
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volitional), or (iii) 15 months after the termination of the Merger Agreement
following the occurrence of an Extension Event (as defined below), or the
termination of the Merger Agreement by Grantee pursuant to Section 9.02(c)(ii)
thereof (unless the breach by Issuer giving rise to such right of termination is
non-volitional), and provided further, that any purchase of Common Stock upon
exercise of the Option shall be subject to applicable law, and provided further,
that the Option may not be exercised, nor may Grantee require Issuer to
repurchase the Option (as set forth in Section 7 hereof), if, at the time of
exercise or repurchase, Grantee is in breach of any covenant or obligation
contained in the Merger Agreement and, if the Merger Agreement has not
terminated prior thereto, such breach would entitle Issuer to terminate the
Merger Agreement. The events described in clauses (i)-(iii) in the preceding
sentence are hereinafter collectively referred to as Exercise Termination
Events. As provided in Section 8, the rights set forth therein shall terminate
upon an Exercise Termination Event and, as provided in Sections 6 and 7 hereof,
the rights to deliver requests pursuant to Sections 6 or 7 shall terminate 12
months after an Exercise Termination Event, subject, in such case, to the
provisions of Section 9.
(b) The term "Extension Event" shall mean any of the following events or
transactions occurring without the Grantee's prior written consent after the
date hereof:
(i) Issuer or any of its subsidiaries (each an "Issuer Subsidiary"), shall
have entered into an agreement to engage in an Acquisition Transaction (as
defined below) with any person (the term "person" for purposes of this Agreement
having the meaning assigned thereto in Sections 3(a)(9) and 13(d)(3) of the
Securities Exchange Act of 1934, as amended (the "Securities Exchange Act"), and
the rules and regulations thereunder) other than Grantee or any of its
subsidiaries (each a "Grantee Subsidiary") or the Board of Directors of Issuer
shall have recommended that the shareholders of Issuer approve or accept any
Acquisition Transaction with any person other than Grantee or any Grantee
Subsidiary. For purposes of this Agreement, "Acquisition Transaction" shall mean
(w) a merger or consolidation, or any similar transaction, involving Issuer or
any of Issuer's banking subsidiaries ("Bank Subsidiaries"), (x) a purchase,
lease or other acquisition of 10% or more of the aggregate value of the assets
or deposits of Issuer or any Bank Subsidiary, (y) a purchase or other
acquisition (including by way of merger, consolidation, share exchange or
otherwise) of securities representing 10% or more of the voting power of Issuer
or a Bank Subsidiary, or (z) any substantially similar transaction, provided,
however, that in no event shall (i) any merger, consolidation or similar
transaction involving Issuer or any Bank Subsidiary in which the voting
securities of Issuer outstanding immediately prior thereto continue to represent
(either by remaining outstanding or being converted into voting securities of
the surviving entity of any such transaction) at least 65% of the combined
voting power of the voting securities of the Issuer or the surviving entity
outstanding after the consummation of such merger, consolidation, or similar
transaction, or (ii) any internal merger or consolidation involving only Issuer
and/or Issuer Subsidiaries, be deemed to be an Acquisition Transaction, provided
that any such transaction is not entered into in violation of the terms of the
Merger Agreement;
(ii) Any person (other than Grantee or any Grantee Subsidiary) shall have
acquired beneficial ownership or the right to acquire beneficial ownership of
securities representing 10% or more of the aggregate voting power of Issuer or
any Bank Subsidiary (the
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term "beneficial ownership" for purposes of this Agreement having the meaning
assigned thereto in Section 13(d) of the Securities Exchange Act, and the rules
and regulations thereunder);
(iii) Any person other than Grantee or any Grantee Subsidiary shall have
made a bona fide proposal to Issuer or its shareholders, by public announcement
or written communication that is or becomes the subject of public disclosure, to
engage in an Acquisition Transaction (including, without limitation, any
situation in which any person other than Grantee or any Grantee Subsidiary shall
have commenced (as such term is defined in Rule 14d-2 under the Exchange Act),
or shall have filed a registration statement under the Securities Act of 1933,
as amended (the "Securities Act"), with respect to, a tender offer or exchange
offer to purchase any shares of Common Stock such that, upon consummation of
such offer, such person would own or control securities representing 10% or more
of the aggregate voting power of Issuer or any Bank Subsidiary);
(iv) After any person other than Grantee or any Grantee Subsidiary has made
or disclosed an intention to make a proposal to Issuer or its shareholders to
engage in an Acquisition Transaction, Issuer shall have breached any covenant or
obligation contained in the Merger Agreement and such breach (x) would entitle
Grantee to terminate the Merger Agreement and (y) shall not have been cured
prior to the Notice Date (as defined below);
(v) Any person other than Grantee or any Grantee Subsidiary shall have
filed an application with, or given a notice to, whether in draft or final form,
the Board of Governors of the Federal Reserve System (the "Federal Reserve
Board") or other governmental authority or regulatory or administrative agency
or commission, domestic or foreign (each, a "Governmental Authority"), for
approval to engage in an Acquisition Transaction; or
(vi) the holders of Common Stock shall not have approved the Merger
Agreement at the meeting of such shareholders held for the purpose of voting on
the Merger Agreement, such meeting shall not have been called by the Board of
Directors of Issuer in accordance with Section 5.03 of the Merger Agreement or
held or shall have been canceled prior to termination of the Merger Agreement or
Issuer's Board of Directors shall have withdrawn or modified in a manner adverse
to the consummation of the Merger the recommendation of Issuer's Board of
Directors with respect to the Merger Agreement, in each case after an Extension
Event;
(vii) any Purchase Event (as defined below).
(c) The term "Purchase Event" shall mean either of the following events or
transactions occurring after the date hereof:
(i) The acquisition by any person other than Grantee or any Grantee
Subsidiary of beneficial ownership of securities representing 25% or more of the
aggregate voting power of Issuer or any Bank Subsidiary; or
(ii) The occurrence of an Extension Event described in Section 2(b)(i)
except that the percentage referred to in clauses (x) and (y) shall be 25%.
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(d) Issuer shall notify Grantee promptly in writing of the occurrence of
any Extension Event or Purchase Event; provided however, that the giving of such
notice by Issuer shall not be a condition to the right of Grantee to exercise
the Option.
(e) In the event that Grantee is entitled to and wishes to exercise the
Option, it shall send to Issuer a written notice (the date of which being herein
referred to as the "Notice Date") specifying (i) the total number of shares of
Common Stock it will purchase pursuant to such exercise, (ii) a place and date
not earlier than three business days nor later than 90 business days from the
Notice Date for the closing of such purchase (the "Closing Date") and (iii) that
the proposed exercise of the Option shall be revocable by Grantee in the event
that the transaction constituting a Purchase Event that gives rise to such
written notice shall not have been consummated prior to exercise of the Option;
provided that if prior notification to or approval of the Federal Reserve Board
or any other Governmental Authority is required in connection with such
purchase, Grantee shall promptly file the required notice or application for
approval and shall expeditiously process the same and the period of time that
otherwise would run pursuant to this sentence shall run from the later of (x)
the date on which any required notification periods have expired or been
terminated and (y) the date on which such approvals have been obtained and any
requisite waiting period or periods shall have expired. For purposes of Section
2(a), any exercise of the Option shall be deemed to occur on the Notice Date
relating thereto. Grantee shall have the right to revoke its proposed exercise
of the Option in the event that the transaction constituting a Purchase Event
that gives rise to such right to exercise shall not have been consummated prior
to exercise of the Option, pursuant to the statement of such right in the
written notice exercising the Option as provided in clause 2(e)(iii) above.
(f) At the closing referred to in Section 2(e), Grantee shall surrender
this Agreement (and the Option granted hereby) to Issuer and pay to Issuer the
Option Price for the shares of Common Stock purchased pursuant to the exercise
of the Option in immediately available funds by wire transfer to a bank account
designated by Issuer; provided, however, that failure or refusal of Issuer to
designate such a bank account shall not preclude Grantee from exercising the
Option.
(g) At such closing, simultaneously with the delivery of the Option Price
in immediately available funds as provided in Section 2(f), Issuer shall deliver
to Grantee a certificate or certificates representing the number of shares of
Common Stock purchased by Grantee and, if the Option should be exercised in part
only, a new Option Agreement granting a new Option evidencing the rights of
Grantee thereof to purchase the balance of the shares of Common Stock
purchasable hereunder. All shares of Common Stock issued upon exercise of the
Option shall be accompanied by the same UJB Financial Corp. Shareholder Rights
as held by a majority of the holders of outstanding Common Stock.
(h) Certificates for Common Stock delivered at a closing hereunder shall be
endorsed with a restrictive legend substantially as follows:
"The transfer of the shares represented by this certificate is subject to
resale restrictions arising under the Securities Act of 1933, as amended,
and to certain provisions of an agreement between The Summit Bancorporation
and UJB Financial Corp. ("Issuer") dated as of the 11th day of September,
1995. A copy
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of such agreement is on file at the principal office of Issuer and will be
provided to the holder hereof without charge upon receipt by Issuer of a
written request therefor."
It is understood and agreed that: (i) the reference to the resale restrictions
of the Securities Act in the above legend shall be removed by delivery of
substitute certificate(s) without such reference if Grantee shall have delivered
to Issuer a copy of a letter from the staff of the Securities and Exchange
Commission (the "SEC"), or an opinion of counsel, in form and substance
satisfactory to Issuer, to the effect that such legend is not required for
purposes of the Securities Act; (ii) the reference to the provisions of this
Agreement in the above legend shall be removed by delivery of substitute
certificate(s) without such reference if the shares have been sold or
transferred in compliance with the provisions of this Agreement and under
circumstances that do not require the retention of such reference; and (iii) the
legend shall be removed in its entirety if the conditions in the preceding
clauses (i) and (ii) are both satisfied. In addition, such certificates shall
bear any other legend as may be required by law.
(i) Upon the giving by Grantee to Issuer of the written notice of exercise
of the Option provided for in Section 2(e) and the tender of the Option Price on
the Closing Date in immediately available funds, Grantee shall be deemed to be
the holder of record of the shares of Common Stock issuable upon such exercise,
notwithstanding that the stock transfer books of Issuer shall then be closed or
that certificates representing such shares of Common Stock shall not then
actually be delivered to Grantee. Issuer shall pay all expenses and any and all
United States federal, state and local taxes and other charges that may be
payable in connection with the preparation, issue and delivery of stock
certificates under this Section 2 in the name of Grantee or its nominee.
SECTION 3. Reservation of Shares. Issuer agrees: (i) that it shall at all
times until the termination of this Agreement have reserved for issuance upon
the exercise of the Option that number of authorized shares of Common Stock
equal to the maximum number of shares of Common Stock at any time and from time
to time issuable hereunder, all of which shares will, upon issuance pursuant
hereto, be duly authorized, validly issued, fully paid, nonassessable, and
delivered free and clear of all claims, liens, encumbrances and security
interests and not subject to any preemptive rights; (ii) that it will not, by
amendment of its certificate of incorporation or through reorganization,
consolidation, merger, dissolution or sale of assets, or by any other voluntary
act, avoid or seek to avoid the observance or performance of any of the
covenants, stipulations or conditions to be observed or performed hereunder by
Issuer; (iii) promptly to take all action as may from time to time be required
(including (x) complying with all premerger notification, reporting and waiting
period requirements specified in 15 U.S.C. ss. 18a and regulations promulgated
thereunder and (y) in the event, under the Bank Holding Company Act of 1956, as
amended (the "BHC Act"), or the Change in Bank Control Act of 1978, as amended,
or any state banking law, prior approval of or notice to the Federal Reserve
Board or to any other Governmental Authority is necessary before the Option may
be exercised, cooperating with Grantee in preparing such applications or notices
and providing such information to the Federal Reserve Board and each other
Governmental Authority as they may require) in order to permit Grantee to
exercise the Option and Issuer duly and effectively to issue shares of Common
Stock pursuant hereto; and (iv) to take all action provided herein to protect
the rights of Grantee against dilution.
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SECTION 4. Division of Option. This Agreement (and the Option granted
hereby) are exchangeable, without expense, at the option of Grantee, upon
presentation and surrender of this Agreement at the principal office of Issuer,
for other agreements providing for Options of different denominations entitling
the holder thereof to purchase, on the same terms and subject to the same
conditions as are set forth herein, in the aggregate the same number of shares
of Common Stock purchasable hereunder. The terms "Agreement" and "Option" as
used herein include any agreements and related options for which this Agreement
(and the Option granted hereby) may be exchanged. Upon receipt by Issuer of
evidence reasonably satisfactory to it of the loss, theft, destruction or
mutilation of this Agreement, and (in the case of loss, theft or destruction) of
reasonably satisfactory indemnification, and upon surrender and cancellation of
this Agreement, if mutilated, Issuer will execute and deliver a new Agreement of
like tenor and date. Any such new Agreement executed and delivered shall
constitute an additional contractual obligation on the part of Issuer, whether
or not the Agreement so lost, stolen, destroyed or mutilated shall at any time
be enforceable by anyone.
SECTION 5. Adjustment upon Change of Capitalization. The number of shares
of Common Stock purchasable upon the exercise of the Option shall be subject to
adjustment from time to time as follows:
(a) Subject to the last sentence of Section 1, in the event of any change
in the Common Stock by reason of stock dividends, split-ups, mergers,
recapitalizations, combinations, subdivisions, conversions, exchanges of shares
or the like, the type and number of shares of Common Stock purchasable upon
exercise hereof shall be appropriately adjusted and proper provision shall be
made so that, in the event that any additional shares of Common Stock are to be
issued or otherwise to become outstanding as a result of any such change (other
than pursuant to an exercise of the Option), the number of shares of Common
Stock that remain subject to the Option shall be increased so that, after such
issuance and together with shares of Common Stock previously issued pursuant to
the exercise of the Option (as adjusted on account of any of the foregoing
changes in the Common Stock), it equals 19.9% of the number of shares of Common
Stock then issued and outstanding (without consideration of any shares of Common
Stock subject to or issued pursuant to the Option).
(b) Whenever the number of shares of Common Stock purchasable upon exercise
hereof is adjusted as provided in this Section 5, the Option Price shall be
adjusted by multiplying the Option Price by a fraction, the numerator of which
shall be equal to the number of shares of Common Stock purchasable prior to the
adjustment and the denominator of which shall be equal to the number of shares
of Common Stock purchasable after the adjustment. In no event shall the Option
Price be adjusted to less than the par value of the Common Stock to be issued at
such Option Price.
(c) It is intended by the parties hereto that the adjustments provided by
this Section 5 shall fully preserve the economic benefits of this Agreement for
Grantee.
SECTION 6. Registration Rights.
(a) Demand Registration Rights. After the occurrence of a Purchase Event
that occurs prior to an Exercise Termination Event, Issuer shall, at the request
of Grantee (whether
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on its own behalf or on behalf of any subsequent holder of the Option (or part
thereof) delivered prior to an Exercise Termination Event or at the request of a
holder of any of the shares of Common Stock issued pursuant hereto) delivered no
later than 12 months after an Exercise Termination Event, promptly prepare, file
and keep current a shelf registration statement under the Securities Act
covering this Option or any shares issued and issuable pursuant to the Option
(the "Option Shares") and shall use its best efforts to cause such registration
statement to become effective and remain current and to qualify this Option or
any such Option Shares or other securities for sale under any applicable state
securities laws in order to permit the sale or other disposition of this Option
or any Option Shares in accordance with any plan of disposition requested by
Grantee; provided, however, that Issuer may postpone filing a registration
statement relating to a registration request by Grantee under this Section 6 for
a period of time (not in excess of 90 days) if in its judgment such filing would
require the disclosure of material information that Issuer has a bona fide
business purpose for preserving as confidential. Issuer will use its best
efforts to cause such registration statement first to become effective as soon
as practicable after the filing thereof and then to remain effective for such
period not in excess of 180 days from the day such registration statement first
becomes effective, or such shorter time as may be necessary to effect such sales
or other dispositions. Grantee shall have the right to demand two such
registrations. Grantee shall provide all information reasonably requested by
Issuer for inclusion in any registration statement to be filed hereunder. In
connection with any such registration, Issuer and Grantee shall provide each
other with representations, warranties, and other agreements customarily given
in connection with such registrations. If requested by any Grantee in connection
with such registration, Issuer and Grantee shall become a party to any
underwriting agreement relating to the sale of Option Shares, but only to the
extent of obligating themselves in respect of representations, warranties,
indemnities and other agreements customarily included in such underwriting
agreements. Notwithstanding the foregoing, if Grantee revokes any exercise
notice or fails to exercise any Option with respect to any exercise notice
pursuant to Section 2(e), Issuer shall not be obligated to continue any
registration process with respect to the sale of Option Shares.
(b) Additional Persons With Registration Rights. Upon receiving any request
under this Section 6 from any Grantee, Issuer agrees to send a copy thereof to
any other person known to Issuer to be entitled to registration rights under
this Section 6, in each case by promptly mailing the same, postage prepaid, to
the address of record of the persons entitled to receive such copies.
Notwithstanding anything to the contrary contained herein, in no event shall
Issuer be obligated to effect more than two registrations pursuant to this
Section 6 by reason of the fact that there shall be more than one Grantee as a
result of any assignment or division of this Agreement.
(c) Expenses. Except where applicable state law prohibits such payments,
Issuer will pay all expenses (including without limitation registration fees,
qualification fees, blue sky fees and expenses (including the fees and expenses
of counsel), legal expenses, including the reasonable fees and expenses of one
counsel to the holders whose Option Shares are being registered, printing
expenses and the costs of special audits or "cold comfort" letters, expenses of
underwriters, excluding discounts and commissions but including liability
insurance if Issuer so desires or the underwriters so require, and the
reasonable fees and expenses of any necessary special experts) in connection
with each registration pursuant to this Section 6 (including the
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related offerings and sales by holders of Option Shares) and all other
qualifications, notification or exemptions pursuant to Section 6.
(d) Indemnification. In connection with any registration under this Section
6, Issuer hereby indemnifies the Grantee, and each officer, director and
controlling person of Grantee, and each underwriter thereof, including each
person, if any who controls such holder or underwriter within the meaning of
Section 15 of the Securities Act, against all expenses, losses, claims, damages
and liabilities caused by any untrue, or alleged untrue, statement contained in
any registration statement or prospectus or notification or offering circular
(including any amendments or supplements thereto) or any preliminary prospectus,
or caused by any omission, or alleged omission, to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, except insofar as such expenses, losses, claims, damages or
liabilities of such indemnified party are caused by any untrue statement or
alleged untrue statement that was included by Issuer in any such registration
statement or prospectus or notification or offering circular (including any
amendments or supplements thereto) in reliance upon and in conformity with,
information furnished in writing to Issuer by such indemnified party expressly
for use therein, and Issuer and each officer, director and controlling person of
Issuer shall be indemnified by such Grantee, or by such underwriter, as the case
may be, for all such expenses, losses, claims, damages and liabilities caused by
any untrue, or alleged untrue, statement, that was included by Issuer in any
such registration statement or prospectus or notification or offering circular
(including any amendments or supplements thereto) in reliance upon, and in
conformity with, information furnished in writing to Issuer by such holder or
such underwriter, as the case may be, expressly for such use.
Promptly upon receipt by a party indemnified under this Section 6(d) of
notice of the commencement of any action against such indemnified party in
respect of which indemnity or reimbursement may be sought against any
indemnifying party under this Section 6(d), such indemnified party shall notify
the indemnifying party in writing of the commencement of such action, but the
failure so to notify the indemnifying party shall not relieve it of any
liability which it may otherwise have to any indemnified party under this
Section 6(d). In case notice of commencement of any such action shall be given
to the indemnifying party as above provided, the indemnifying party shall be
entitled to participate in and, to the extent it may wish, jointly with any
other indemnifying party similarly notified, to assume the defense of such
action at its own expense, with counsel chosen by it and reasonably satisfactory
to such indemnified party. The indemnified party shall have the right to employ
separate counsel in any such action and participate in the defense thereof, but
the fees and expenses of such counsel (other than reasonable costs of
investigation) shall be paid by the indemnified party unless (i) the
indemnifying party either agrees to pay the same, (ii) the indemnifying party
fails to assume the defense of such action with counsel satisfactory to the
indemnified party, or (iii) the indemnified party has been advised by counsel
that one or more legal defenses may be available to the indemnifying party that
may be contrary to the interests of the indemnified party. No indemnifying party
shall be liable for the fees and expenses of more than one separate counsel for
all indemnified parties or for any settlement entered into without its consent,
which consent may not be unreasonably withheld.
If the indemnification provided for in this Section 6(d) is unavailable to
a party otherwise entitled to be indemnified in respect of any expenses, losses,
claims, damages or liabilities
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referred to herein, then the indemnifying party, in lieu of indemnifying such
party otherwise entitled to be indemnified, shall contribute to the amount paid
or payable by such party to be indemnified as a result of such expenses, losses,
claims, damages or liabilities in such proportion as is appropriate to reflect
the relative fault of Issuer, the Grantee and the underwriters in connection
with the statements or omissions which resulted in such expenses, losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The amount paid or payable by a party as a result of the
expenses, losses, claims, damages and liabilities referred to above shall be
deemed to include any legal or other fees or expenses reasonably incurred by
such party in connection with investigating or defending any action or claim;
provided, however, that in no case shall any Grantee be responsible, in the
aggregate, for any amount in excess of the net offering proceeds attributable to
its Option Shares included in the offering. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. Any obligation by any Grantee to indemnify shall
be several and not joint with other Grantees.
(e) Miscellaneous Reporting. Issuer shall comply with all reporting
requirements and will do all such other things as may be necessary to permit the
expeditious sale at any time of any Option Shares by the Grantee thereof in
accordance with and to the extent permitted by any rule or regulation
promulgated by the SEC from time to time, including, without limitation, Rule
144A. Issuer shall at its expense provide the Grantee with any information
necessary in connection with the completion and filing of any reports or forms
required to be filed by Grantee under the Securities Act or the Exchange Act, or
required pursuant to any state securities laws or the rules of any stock
exchange.
SECTION 7. Repurchase at the Option of Grantee or Owner. (a) Upon the
occurrence of a Repurchase Event (as defined below), (i) at the request (the
date of such request being the "Request Date") of Grantee, delivered prior to an
Exercise Termination Event, Issuer (or any successor thereto) shall repurchase
the Option from Grantee at a price (the "Option Repurchase Price") equal to the
amount by which (A) the market/offer price (as defined below) exceeds (B) the
Option Price, multiplied by the number of shares for which this Option may then
be exercised and (ii) at the request (the date of such request being the
"Request Date") of the owner of Option Shares from time to time (the "Owner"),
delivered within 12 months of the occurrence of a Repurchase Event (or such
later period as provided in Section 9), Issuer shall repurchase such number of
the Option Shares from the Owner as the Owner shall designate at a price (the
"Option Share Repurchase Price") equal to the market/offer price multiplied by
the number of Option Shares so designated. The term "market/offer price" shall
mean the highest of (i) the price per share of Common Stock at which a tender
offer or exchange offer therefor has been made after the date hereof and on or
prior to the Request Date, (ii) the price per share of Common Stock paid or to
be paid by any third party pursuant to an agreement with Issuer (whether by way
of a merger, consolidation or otherwise), (iii) the highest last sale price for
shares of Common Stock within the 90-day period ending on the Request Date
quoted on the New York Stock Exchange (as reported by The Wall Street Journal,
or, if not reported thereby, another authoritative source), (iv) in the event of
a sale of all or substantially all of Issuer's assets, the sum of the price paid
in such sale for such assets and the current market value of the remaining
assets of Issuer as determined by a nationally-recognized independent investment
banking firm selected by Grantee or the Owner, as the case may be, divided by
the number of
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shares of Common Stock outstanding at the time of such sale. In determining the
market/offer price, the value of consideration other than cash shall be
determined by a nationally-recognized independent investment banking firm
selected by Grantee or the Owner, as the case may be, whose determination shall
be conclusive and binding on all parties.
(b) Grantee or the Owner, as the case may be, may exercise its right to
require Issuer to repurchase the Option and/or any Option Shares pursuant to
this Section 7 by surrendering for such purpose to Issuer, at its principal
office, a copy of this Agreement or certificates for Option Shares, as
applicable, accompanied by a written notice or notices stating that Grantee or
the Owner, as the case may be, elects to require Issuer to repurchase the Option
and/or the Option Shares in accordance with the provisions of this Section 7. As
promptly as practicable, and in any event within the later to occur of (x) five
business days after the surrender of the Option and/or certificates representing
Option Shares and the receipt of such notice or notices relating thereto and (y)
the time that is immediately prior to the occurrence of a Repurchase Event,
Issuer shall deliver or cause to be delivered to Grantee the Option Repurchase
Price or to the Owner the Option Share Repurchase Price therefor or the portion
thereof that Issuer is not then prohibited from so delivering under applicable
law and regulation or as a consequence of administrative policy.
(c) Issuer hereby undertakes to use its reasonable efforts to obtain all
required regulatory and legal approvals and to file any required notices as
promptly as practicable in order to accomplish any repurchase contemplated by
this Section 7. Nonetheless, to the extent that Issuer is prohibited under
applicable law or regulation, or as a consequence of administrative policy, from
repurchasing the Option and/or the Option Shares in full, Issuer shall promptly
so notify Grantee and/or the Owner and thereafter deliver or cause to be
delivered, from time to time, to Grantee and/or the Owner, as appropriate, the
portion of the Option Repurchase Price and the Option Share Repurchase Price,
respectively, that it is no longer prohibited from delivering, within five
business days after the date on which Issuer is no longer so prohibited;
provided, however, that if Issuer at any time after delivery of a notice of
repurchase pursuant to Section 7(b) is prohibited under applicable law or
regulation, or as a consequence of administrative policy, from delivering to
Grantee and/or the Owner, as appropriate, the Option Repurchase Price or the
Option Share Repurchase Price, respectively, in full or in any substantial part,
Grantee or the Owner, as appropriate, may revoke its notice of repurchase of the
Option or the Option Shares either in whole or in part whereupon, in the case of
a revocation in part, Issuer shall promptly (i) deliver to Grantee and/or the
Owner, as appropriate, that portion of the Option Purchase Price or the Option
Share Repurchase Price that Issuer is not prohibited from delivering after
taking into account any such revocation and (ii) deliver, as appropriate, either
(A) to Grantee, a new Agreement evidencing the right of Grantee to purchase that
number of shares of Common Stock equal to the number of shares of Common Stock
purchasable immediately prior to the delivery of the notice of repurchase less
the number of shares of Common Stock covered by the portion of the Option
repurchased or (B) to the Owner, a certificate for the number of Option Shares
covered by the revocation.
(d) For purposes of this Section 7, a Repurchase Event shall be deemed to
have occurred (i) upon the consummation of any merger, consolidation or similar
transaction involving Issuer or any Bank Subsidiary any purchase, lease or other
acquisition of all or a substantial portion of the assets of Issuer or any Bank
Subsidiary, other than any such
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transaction which would not constitute an Acquisition Transaction pursuant to
the proviso to Section 2(b)(i) hereof or (ii) upon the acquisition by any person
of beneficial ownership of securities representing 50% or more of the aggregate
voting power of Issuer or any Bank Subsidiary, provided that no such event shall
constitute a Repurchase Event unless an Extension Event shall have occurred
prior to an Exercise Termination Event. The parties hereto agree that Issuer's
obligations to repurchase the Option or Option Shares under this Section 7 shall
not terminate upon the occurrence of an Exercise Termination Event if an
Extension Event shall have occurred prior to the occurrence of an Exercise
Termination Event.
(e) Issuer shall not enter into any agreement with any party (other than
Grantee or a Grantee Subsidiary) for an Acquisition Transaction unless the other
party thereto assumes all the obligations of Issuer pursuant to this Section 7
in the event that Grantee or the Owner elects, in its sole discretion, to
require such other party to perform such obligations.
SECTION 8. Substitute Option in the Event of Corporate Change. (a) In the
event that prior to an Exercise Termination Event, Issuer shall enter into an
agreement (i) to consolidate or merge with any person, other than Grantee or a
Grantee Subsidiary, and shall not be the continuing or surviving corporation of
such consolidation or merger, (ii) to permit any person, other than Grantee or a
Grantee Subsidiary, to merge into Issuer and Issuer shall be the continuing or
surviving corporation, but, in connection with such merger, the then outstanding
shares of Common Stock shall be changed into or exchanged for stock or other
securities of any other person or cash or any other property or the then
outstanding shares of Common Stock shall after such merger represent less than
50% of the aggregate voting power of the merged company, or (iii) to sell or
otherwise transfer all or substantially all of its assets to any person, other
than Grantee or a Grantee Subsidiary, then, and in each such case, the agreement
governing such transaction shall make proper provision so that the Option shall,
upon the consummation of such transaction and upon the terms and conditions set
forth herein, be converted into, or exchanged for, an option (the "Substitute
Option"), at the election of Grantee, of either (x) the Acquiring Corporation
(as defined below) or (y) any person that controls the Acquiring Corporation
(the Acquiring Corporation and any such controlling person being hereinafter
referred to as the Substitute Option Issuer).
(b) The Substitute Option shall be exercisable for such number of shares of
the Substitute Common Stock (as is hereinafter defined) as is equal to the
market/offer price (as defined in Section 7) multiplied by the number of shares
of the Common Stock for which the Option was theretofore exercisable, divided by
the Average Price (as is hereinafter defined) The exercise price of the
Substitute Option per share of the Substitute Common Stock (the "Substitute
Purchase Price") shall then be equal to the Option Price multiplied by a
fraction in which the numerator is the number of shares of the Common Stock for
which the Option was theretofore exercisable and the denominator is the number
of shares of Substitute Common Stock for which the Substitute Option is
exercisable.
(c) The Substitute Option shall otherwise have the same terms as the
Option, provided that if the terms of the Substitute Option cannot, for legal
reasons, be the same as the Option, such terms shall be as similar as possible
and in no event less advantageous to Grantee, provided further that the terms of
the Substitute Option shall include (by way of example and
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not limitation) provisions for the repurchase of the Substitute Option and
Substitute Common Stock by the Substitute Option Issuer on the same terms and
conditions as provided in Section 7.
(d) The following terms have the meanings indicated:
(i) "Acquiring Corporation" shall mean (i) the continuing or surviving
corporation of a consolidation or merger with Issuer (if other than
Issuer), (ii) Issuer in a merger in which Issuer is the continuing or
surviving person, and (iii) the transferee of all or any substantial part
of the Issuer's assets (or the assets of Issuer Subsidiaries).
(ii) "Substitute Common Stock" shall mean the common stock issued by
the Substitute Option Issuer upon exercise of the Substitute Option.
(iii) "Average Price" shall mean the average last sale price of a
share of the Substitute Common Stock (as reported by The Wall Street
Journal or, if not reported therein, by another authoritative source) for
the one year immediately preceding the consolidation, merger or sale in
question, but in no event higher than the last sale price of the shares of
the Substitute Common Stock on the day preceding such consolidation, merger
or sale; provided that if Issuer is the issuer of the Substitute Option,
the Average Price shall be computed with respect to a share of common stock
issued by Issuer, the person merging into Issuer or by any company which
controls or is controlled by such person, as Grantee may elect.
(e) In no event, pursuant to any of the foregoing paragraphs, shall the
Substitute Option be exercisable for more than 19.9% of the aggregate of the
shares of the Substitute Common Stock outstanding prior to the exercise of the
Substitute Option. In the event that the Substitute Option would be exercisable
for more than 19.9% of the aggregate of the shares of Substitute Common Stock
but for this clause (e), the Substitute Option Issuer shall make a cash payment
to Grantee equal to the excess of (i) the value of the Substitute Option without
giving effect to the limitation in this clause (e) over (ii) the value of the
Substitute Option after giving effect to the limitation in the clause (e). This
difference in value shall be determined by a nationally recognized investment
banking firm selected by Grantee and the Substitute Option Issuer.
SECTION 9. Extension of Time for Regulatory Approvals. Notwithstanding
Sections 2(e), 6, 7 and 11, if Grantee has given the notice referred to in one
or more of such Sections, the exercise of the rights specified in any such
Section shall be extended (a) if the exercise of such rights requires obtaining
regulatory approvals, to the extent necessary to obtain all regulatory approvals
for the exercise of such rights, and (b) to the extent necessary to avoid
liability under Section 16(b) of the Securities Exchange Act by reason of such
exercise; provided that in no event shall any closing date occur more than 18
months after the related Notice Date, and, if the closing date shall not have
occurred within such period due to the failure to obtain any required approval
by the Federal Reserve Board or any other Governmental Authority despite the
reasonable efforts of Issuer or the Substitute Option Issuer, as the case may
be, to obtain such approvals, the exercise of the Option shall be deemed to have
been rescinded as of the related Notice Date. In the event (a) Grantee receives
official notice that an approval of the Federal Reserve Board or any other
Governmental Authority required for the purchase and sale of the
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Option Shares will not be issued or granted or (b) a closing date has not
occurred within 18 months after the related Notice Date due to the failure to
obtain any such required approval, Grantee shall be entitled to exercise the
Option in connection with the resale of the Option Shares pursuant to a
registration statement as provided in Section 6. Nothing contained in this
Agreement shall restrict Grantee from specifying alternative exercising of
rights pursuant to Sections 2(e), 6, 7 and 11, hereof in the event that the
exercising of any such rights shall not have occurred due to the failure to
obtain any required approval referred to in this Section 9.
SECTION 10. Issuer Warranties. Issuer hereby represents and warrants to
Grantee as follows:
(a) Issuer has the requisite corporate power and authority to execute and
deliver this Agreement and to consummate the transactions contemplated hereby.
The execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly approved by the Board of
Directors of Issuer and no other corporate proceedings on the part of Issuer are
necessary to authorize this Agreement or to consummate the transactions so
contemplated. This Agreement has been duly executed and delivered by, and
constitutes a valid and binding obligation of, Issuer, enforceable against
Issuer in accordance with its terms, except as enforceability thereof may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium and
other similar laws affecting the enforcement of creditors' rights generally and
except that the availability of the equitable remedy of specific performance or
injunctive relief is subject to the discretion of the court before which any
proceeding may be brought.
(b) Issuer has taken all necessary corporate action to authorize and
reserve and to permit it to issue, and at all times from the date hereof through
the termination of this Agreement in accordance with its terms will have
reserved for issuance upon the exercise of the Option, that number of shares of
Common Stock equal to the maximum number of shares of Common Stock at any time
and from time to time issuable hereunder, and all such shares, upon issuance
pursuant hereto, will be duly authorized, validly issued, fully paid,
nonassessable, and will be delivered free and clear of all claims, liens,
encumbrances and security interests and not subject to any preemptive rights.
(c) Upon receipt of the necessary regulatory approvals as contemplated by
this Agreement, the execution, delivery and performance of this Agreement does
not or will not, and the consummation by Issuer of any of the transactions
contemplated hereby will not, constitute or result in (i) a breach or violation
of, or a default under, its certificate of incorporation or by-laws, or the
comparable governing instruments of any of its subsidiaries, or (ii) a breach or
violation of, or a default under, any agreement, lease, contract, note,
mortgage, indenture, arrangement or other obligation of it or any of its
subsidiaries (with or without the giving of notice, the lapse of time or both)
or under any law, rule, ordinance or regulation or judgment, decree, order,
award or governmental or non-governmental permit or license to which it or any
of its subsidiaries is subject, that would in any case give any other person the
ability to prevent or enjoin Issuer's performance under this Agreement in any
material respect.
SECTION 11. Assignment of Option by Grantee. (a) Neither of the parties
hereto may assign any of its rights or delegate any of its obligations under
this Agreement or the Option created hereunder to any other person without the
express written consent of the other party,
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except that Grantee may assign this Agreement to a wholly owned subsidiary of
Grantee and Grantee may assign its rights hereunder in whole or in part after
the occurrence of a Purchase Event; provided, however, that until the date 15
days following the date at which the Federal Reserve Board approves an
application by Grantee under the BHC Act to acquire the shares of Common Stock
subject to the Option, Grantee may not assign its rights under the Option except
in (i) a widely dispersed public distribution, (ii) a private placement in which
no one party acquires the right to purchase securities representing in excess of
2% of the aggregate voting power of Issuer, (iii) an assignment to a single
party (e.g., a broker or investment banker) for the purpose of conducting a
widely dispersed public distribution on Grantee's behalf, or (iv) any other
manner approved by the Federal Reserve Board. Grantee will pay any reasonable
out-of-pocket costs and expenses of Issuer in connection with any such
assignment. The term "Grantee" as used in this Agreement shall also be deemed to
refer to Grantee's permitted assigns.
(b) Any assignment of rights of Grantee to any permitted assignee of
Grantee hereunder shall bear the restrictive legend at the beginning thereof
substantially as follows:
"The transfer of the option represented by this assignment and the
related option agreement is subject to resale restrictions arising
under the Securities Act of 1933, as amended and to certain provisions
of an agreement between The Summit Bancorporation and UJB Financial
Corp. ("Issuer") dated as of the 11th day of September, 1995. A copy
of such agreement is on file at the principal office of Issuer and
will be provided to any permitted assignee of the Option without
change upon receipt by Issuer of a written request therefor."
It is understood and agreed that (i) the reference to the resale restrictions of
the Securities Act in the above legend shall be removed by delivery of
substitute assignments without such reference if Grantee shall have delivered to
Issuer a copy of a letter from the staff of the SEC, or an opinion of counsel,
in form and substance satisfactory to Issuer, to the effect that such legend is
not required for purposes of the Securities Act; (ii) the reference to the
provisions of this Agreement in the above legend shall be removed by delivery of
substitute assignments without such reference if the Option has been sold or
transferred in compliance with the provisions of this Agreement and under
circumstances that do not require the retention of such reference; and (iii) the
legend shall be removed in its entirety if the conditions in the preceding
clauses (i) and (ii) are both satisfied. In addition, such assignments shall
bear any other legend as may be required by law.
SECTION 12. Application for Regulatory Approval. If Grantee is entitled to
exercise the Option and has sent a notice to Issuer pursuant to Section 2(e),
each of Grantee and Issuer will use its reasonable efforts to make all filings
with, and to obtain consents of, all third parties and the Federal Reserve Board
and other Governmental Authorities necessary to the consummation of the
transactions contemplated by this Agreement, including, without limitation,
making application for listing or quotation, as the case may be, of the shares
of Common Stock issuable hereunder on the New York Stock Exchange and applying
to the Federal Reserve Board under the BHC Act and to state banking authorities
for approval to acquire the shares issuable hereunder.
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SECTION 13. Specific Performance. The parties hereto acknowledge that
damages would be an inadequate remedy for a breach of this Agreement by either
party hereto and that the obligations of the parties shall hereto be enforceable
by either party hereto through injunctive or other equitable relief. Both
parties further agree to waive any requirement for the securing or posting of
any bond in connection with the obtaining of any such equitable relief and that
this provision is without prejudice to any other rights that the parties hereto
may have for any failure to perform this Agreement.
SECTION 14. Separability of Provisions. If any term, provision, covenant or
restriction contained in this Agreement is held by a court or a federal or state
regulatory agency of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms, provisions and covenants and
restrictions contained in this Agreement shall remain in full force and effect,
and shall in no way be affected, impaired or invalidated. If for any reason such
court or regulatory agency determines that Grantee is not permitted to acquire,
or Issuer is not permitted to repurchase, pursuant to Section 7, the full number
of shares of Common Stock provided in Section 1 (as adjusted pursuant hereto),
it is the express intention of Issuer to allow Grantee to acquire or to require
Issuer to repurchase such lesser number of shares as may be permissible, without
any amendment or modification hereof.
SECTION 15. Notices. All notices, requests, claims, demands and other
communications hereunder shall be deemed to have been duly given when delivered
in person, by cable, telegram, telecopy or telex, or by registered or certified
mail (postage prepaid, return receipt requested) at the respective addresses of
the parties set forth in the Merger Agreement.
SECTION 16. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New Jersey.
SECTION 17. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original, but all of which
shall constitute one and the same agreement.
SECTION 18. Expenses. Except as otherwise expressly provided herein, each
of the parties hereto shall bear and pay all costs and expenses incurred by it
or on its behalf in connection with the transactions contemplated hereunder,
including fees and expenses of its own financial consultants, investment
bankers, accountants and counsel.
SECTION 19. Entire Agreement; No Third-Party Beneficiaries. Except as
otherwise expressly provided herein or in the Merger Agreement, this Agreement
contains the entire agreement between the parties with respect to the
transactions contemplated hereunder and supersedes all prior arrangements or
understandings with respect thereof, written or oral. The terms and conditions
of this Agreement shall inure to the benefit of and be binding upon the parties
hereto and their respective successors and permitted assigns. Nothing in this
Agreement, expressed or implied, is intended to confer upon any party, other
than the parties hereto, and their respective successors and assigns, any
rights, remedies, obligations or liabilities under or by reason of this
Agreement, except as expressly provided herein.
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SECTION 20. Merger Agreement. Nothing contained in this Agreement shall be
deemed to authorize Issuer or Grantee to breach any provision of the Merger
Agreement.
SECTION 21. Majority in Interest. In the event that any selection or
determination is to be made by Grantee or the Owner hereunder and at the time of
such selection or determination there is more than one Grantee or Owner, such
selection shall be made by a majority in interest of such Grantees or Owners.
SECTION 22. Further Assurances. In the event of any exercise of the Option
by Grantee, Issuer and such Grantee shall execute and deliver all other
documents and instruments and take all other action that may be reasonably
necessary in order to consummate the transactions provided for by such exercise.
SECTION 23. No Rights as Shareholder. Except to the extent Grantee
exercises the Option, Grantee shall have no rights to vote or receive dividends
or have any other rights as a shareholder with respect to shares of Common Stock
covered hereby.
SECTION 24. Grantee Representation. The Option and any Option Shares or
other securities acquired by Grantee upon exercise of the Option are not being,
and will not be, as the case may be, acquired with a view to the public
distribution thereof in the United States except as provided for in Sections 6
and 11 hereof and neither the Option nor any Option Shares or other securities
acquired by Grantee upon exercise of the Option will be transferred or otherwise
disposed of by Grantee except in a transaction registered or exempt from
registration under the Securities Act.
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IN WITNESS WHEREOF, each of the parties has caused this Stock Option
Agreement to be executed on its behalf by their officers thereunto duly
authorized, all as of the date first above written.
The Summit Bancorporation
By: /s/ ROBERT G. COX
------------------------------
Robert G. Cox
UJB Financial Corp.
By: /s/ T. JOSEPH SEMROD
------------------------------
T. Joseph Semrod
EXHIBIT (99)
THE SUMMIT BANCORPORATION STOCK OPTION AGREEMENT
Incorporated by reference to Exhibit 10(b) to the Schedule 13D dated September
11, 1995, as filed by UJB with respect to the Common Stock, no par value, of The
Summit Bancorporation.
