<PAGE>
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) - October 6, 1994
HUBCO, INC.
(Exact Name of Registrant as Specified in Charter)
NEW JERSEY
(State or Other Jurisdiction of Incorporation)
1-10699 22-2405746
(Commission File Number)(IRS Employer Identification No.)
3100 Bergenline Avenue, Union City, New Jersey 07087
(Address of Principal Executive Offices)
(201) 348-2300
(Registrant's Telephone Number)
<PAGE>
Item 5. Other Events.
1. On October 6, 1994 HUBCO Inc. ("HUBCO") announced the
signing of a Letter of Intent by its subsidiary, Hudson
United Bank, to acquire Shoppers Charge Accounts Co.
("Shoppers") of Jersey City, New Jersey for approximately
$18.5 million in cash.
Shoppers is a third party private label retail credit
card company. Shoppers' credit operating system can also
be used by Hudson United Bank to manage a traditional
credit card portfolio.
Shoppers will become a division of Hudson United Bank,
and Thomas R. Nelson, Chief Operating Officer, will
remain with Hudson United Bank as President of the
Division having overall responsibility for its
operations.
As part of the Letter of Intent, Shoppers has agreed to
pay a break-up fee under certain circumstances.
2. On October 7, 1994, HUBCO and Jefferson National Bank
("Jefferson") announced that they had signed a definitive
agreement for HUBCO to acquire Jefferson. Under the
terms of the Agreement, Jefferson shareholders will
receive 1.91 shares of HUBCO common stock for each share
of Jefferson common stock which they own, subject to
certain collar provisions which will apply in the event
that HUBCO's average selling price (during a specified
period prior to the effective date of the merger) falls
below $19.34 per share or increases above $26.16 per
share, and subject to adjustment for certain other
events. Jefferson currently has approximately 226,000
outstanding shares, of which approximately 11,000 are
owned by HUBCO. Thus, approximately 410,000 HUBCO shares
will be issued in the merger if no adjustments are made
based on the collar. The acquisition will be treated as
a "pooling of interests" for accounting purposes.
Jefferson, headquartered in Passaic, has assets of
approximately $100 million and four branches serving
Clifton and Passaic.
The agreement, which provides for certain payments to be
made to HUBCO in the event that it terminates for reasons
associated with a competing offer, is subject to certain
conditions, including receipt of all regulatory approvals
and the approval of Jefferson shareholders.
As part of the merger agreement, Jefferson will be merged
into Hudson United Bank.
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3. On October 13, 1994, HUBCO announced its regular
quarterly cash dividend of $.15 (fifteen cents) per
common share, payable December 1, 1994, to stockholders
of record November 15, 1994. Additionally, the Board of
Directors of HUBCO approved a 3 for 2 stock split payable
January 14, 1995, to common stockholders of record
January 3, 1995. HUBCO announced its intention to
maintain the $.15 (fifteen cents) per share regular
quarterly dividend following the stock split which would
result in a 50% increase in the cash dividend for 1995.
HUBCO also declared a cash dividend of $.36 (thirty-six
cents) per share, for HUBCO's Series A Preferred Stock,
payable November 15, 1994, to stockholders of record
October 31, 1994. The Series A Preferred Stock was
issued in conjunction with the merger of Washington
Bancorp into HUBCO, which was completed On July 1, 1994.
Item 7 - Exhibits
99.1 Press Release dated October 6, 1994
99.2 Press Release dated October 7, 1994
99.3 Press Release dated October 13, 1994
99.4 Memorandum of Intent dated October 6, 1994 between
Hudson United Bank and Shoppers.
99.5 Agreement and Plan of Merger dated October 7, 1994
between HUBCO, Hudson United Bank and Jefferson.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, HUBCO, Inc. has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
HUBCO, Inc.
Dated : October 20, 1994 By: KENNETH T. NEILSON
Kenneth T. Neilson
President and
Chief Executive Officer
Exhibit 99.1 - Press Release dated October 6, 1994
FOR IMMEDIATE RELEASE
October 6, 1994
HUBCO, INC. AND SHOPPERS CHARGE ACCOUNTS CO.
SIGN LETTER OF INTENT
UNION CITY, NEW JERSEY, OCTOBER 6, 1994 -- HUBCO, Inc.
(NASDAQ; HUBC) today announced the signing of a Letter of Intent by
its subsidiary, Hudson United Bank, to acquire Shoppers Charge
Accounts Co. of Jersey City, New Jersey for approximately $18.5
million cash.
Shoppers Charge is the twelfth largest, third party private
label retail credit card company in the United States. Private-
label revolving credit cards issued on behalf of retail stores by
third party firms accounted for 32% of outstandings on all retail
credit cards at year-end 1992. Shoppers has a sophisticated credit
operating system which can also be used Hudson United to manage a
traditional credit card portfolio.
"We are very excited about this acquisition and the many
opportunities that it brings", stated Kenneth T. Neilson, President
and Chief Executive Officer of HUBCO. "Shoppers has a 50-plus year
history of providing financial services to the retail community.
The synergies of our respective operations will ensure that both
become stronger as a result of this acquisition."
Shoppers will become a division of Hudson United Bank, and
Thomas R. Nelson, Chief Operating Officer, will remain with Hudson
United Bank as President of the Division having overall
responsibility for its operations.
As part of the Letter of Intent, Shoppers has agreed to pay a
break-up fee under certain circumstances.
The acquisition is expected to close during the fourth quarter
of 1994.
HUBCO, Inc., with assets of $1.4 billion, owns Hudson United
Bank with 45 branches throughout Northern New Jersey and HUB
Financial Services, Inc. which provides computer services and
Imaged Check Processing Services. The acquisition of Shoppers will
be HUBCO's ninth acquisition in the past four and one half years
and the first non-bank acquisition.
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Exhibit 99.2 - Press Release dated October 7, 1994
FOR IMMEDIATE RELEASE
October 7, 1994
HUBCO, INC. AND JEFFERSON NATIONAL BANK SIGN DEFINITIVE AGREEMENT
UNION CITY, NEW JERSEY, OCTOBER 7, 1994 -- HUBCO, Inc.
(NASDAQ; HUBC) and Jefferson National Bank announced today that
they had signed a Definitive Agreement for HUBCO to acquire
Jefferson for common stock worth approximately $10 million. Under
the terms of the Agreement, Jefferson shareholders will receive
1.91 shares of HUBCO stock for each share of Jefferson stock which
they own, subject to certain collar provisions which will apply in
the event that HUBCO's average selling price (during a specified
period prior to the effective date of the merger) falls below
$19.34 per share or increases above $26.16 per share and subject to
adjustment for certain other events. The acquisition will be
treated as a "pooling of interests" for accounting purposes.
Jefferson National Bank, headquartered in Passaic, has assets
of approximately $100 million and four branches serving Clifton and
Passaic.
HUBCO's President and Chief Executive Officer, Kenneth T.
Neilson, commented "We are pleased that Jefferson has chosen to
join HUBCO. During the past two years, the management team at
Jefferson has made solid progress toward resolving the difficulties
which grew out of the depressed real estate market a few years ago.
The merger will enhance HUBCO's market presence in Passaic County,
one if its primary service areas."
Jefferson's Chairman, Raymond Sisco, and Joseph Greco, its
President, stated "We are delighted that we have been able to
provide this opportunity to our shareholders. At HUBCO's current
market price, the 1.91 exchange ratio creates approximately $43.00
in value for each share of Jefferson common stock. We believe that
this transaction provides each of our shareholders with an
opportunity to be part of a vibrant banking organization that is
positioned to provide a wide range of banking services and products
to the communities that Jefferson and HUBCO serve."
The management of HUBCO, Inc. and Jefferson National Bank said
they expect the merger to close in the first quarter of 1995. The
Agreement, which provides for certain payments to be made to HUBCO
in the event that it terminates for reasons associated with a
competing offer, is subject to certain conditions, including
receipt of all regulatory approvals and the approval of Jefferson
National Bank shareholders. A proxy statement describing the
details of the merger is expected to be circulated to shareholders
of Jefferson either in December 1994 or January 1995.
As part of the merger agreement, Jefferson National Bank will
be merged into Hudson United Bank, a subsidiary of HUBCO.
HUBCO, Inc., with assets of $1.4 billion, owns Hudson United
Bank with 45 branches throughout Northern New Jersey. The
acquisition of Jefferson will be HUBCO's tenth acquisition in the
past four and one half years.
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Exhibit 99.3 - Press Release dated October 13, 1994
FOR IMMEDIATE RELEASE
October 13, 1994
HUBCO, INC. ANNOUNCES REGULAR CASH DIVIDEND AND STOCK SPLIT
WHICH INCREASES THE ANTICIPATED PAYOUT 50% FOR 1995.
UNION CITY, NJ, OCTOBER 13, 1994 -- HUBCO, Inc. (NASDAQ:HUBC),
the 10th largest New Jersey based bank holding company, today
announced its regular quarterly cash dividend of $5.1 (fifteen
cents) per common share, payable December 1, 1994, to stockholders
of record November 15, 1994. Additionally, the Board approved a 3
for 2 stock split payable January 14, 1995, to stockholders of
record January 3, 1995.
"This marks the 66th consecutive quarter that HUBCO has paid
a dividend and the decision to also declare a stock split reflects
our continued confidence in the future of HUBCO. It is our
intention to maintain the $.15 (fifteen cents) per share regular
quarterly dividend following the stock split which would result in
a 50% increase in the cash dividend for 1995," stated HUBCO
President and Chief Executive Officer, Kenneth T. Neilson.
HUBCO also declared a cash dividend of $.36 (thirty-six cents)
per share, for the Series A Preferred Stock, payable November 15,
1994, to stockholders of record October 31, 1994. The Series A
Preferred Stock was issued in conjunction with the merger of
Washington Bancorp. into HUBCO, Inc. which was completed on July 1,
1994.
Last week HUBCO announced the signing of a Letter of Intent to
acquire Shoppers Charge Accounts Co., of Jersey City and the
signing of a Definitive Agreement to acquire Jefferson National
Bank, headquartered in Passaic, New Jersey. With the consummation
of these acquisitions, HUBCO will have completed ten acquisitions
in the past four and one half years.
HUBCO, Inc., with assets of $1.4 billion, owns Hudson United
Bank which operates 45 offices throughout Northern New Jersey and
HUB Financial Services, Inc. which provides computer services and
Imaged Check Processing Services.
<PAGE>
Exhibit 99.4 - Memorandum of Intent dated October 6, 1994 between
Hudson United Bank and Shoppers
MEMORANDUM OF INTENT
Set forth below is an outline of the principal points
which have been included in discussions between the undersigned
relative to the purchase of all of the capital stock of SHOPPERS
CHARGE ACCOUNTS CO., a New Jersey corporation (the "Company"), by
HUDSON UNITED BANK, a New Jersey banking corporation, and/or one or
more of its affiliates (the "Buyer"). Each of BERNARD EICHENBAUM
and DAVID LEFF (the "Voting Shareholders") owns 250,000 shares of
Class B common stock of the Company (the "Voting Stock"), which
constitutes 100% of the issued voting stock of the Company. Three
other individuals (the "Other Shareholders") own the remainder of
the issued capital stock of the Company, which consists of 8,000
shares of Class A non-voting stock (all of the Company's
shareholders being collectively referred to herein as the
"Shareholders"). Our discussions after the date hereof would be
directed toward reaching a mutually satisfactory Definitive
Agreement (the "Definitive Agreement") governing such purchase (the
"Purchase"). The consummation of such purchase is referred to as
the "Closing."
We expect to proceed with such discussions on the fol-
lowing assumptions:
1. The Shareholders would sell and the Buyer would pur-
chase all of the capital stock (voting and non-voting) of the
Company (the "Stock") so that upon the Closing the Buyer will be
the sole shareholder of the Company. The Stock would be conveyed
free and clear of all liens and encumbrances. It is understood
that the Other Shareholders are not parties to this Memorandum of
Intent and that, if one or more of the Other Shareholders does not
agree to execute the Definitive Agreement, the parties hereto would
cooperate to restructure the transaction in order to enable the
Buyer to acquire 100% ownership of the Company. Notwithstanding
the foregoing, the Company and the Voting Shareholders would use
their best efforts to persuade the Other Shareholders to execute
the Definitive Agreement, but the Voting Shareholders would not be
required to allocate a disproportionate share of the Purchase Price
to the Other Shareholders in order to induce them to execute the
Definitive Agreement.
2. The aggregate purchase price for the Stock would be
Eighteen Million Five Hundred Thousand Dollars ($18,500,000),
payable by delivery of the Buyer's promissory notes which would
mature on the first business day of January, 1995. Such notes (i)
would bear interest at the rate paid by Hudson United Bank as of
the Closing on its money market type deposit accounts, (ii) would
not be subject to set off (but would provide for the establishment
of an escrow in accordance with the indemnification provisions of
the Definitive Agreement), (iii) would not be subject to
prepayment, and (iv) would be unsecured, except that if the Buyer
is not Hudson United Bank the payment of such notes would be
guaranteed by Hudson United Bank.
3. As part of the transaction, and without any
additional consideration, Mr. Eichenbaum and Mr. Leff would agree
to provide transition and consulting services to the Buyer for a
period of three (3) years after the Closing. Each of such
individuals would be expected to devote no more than 80 hours per
year, would provide services at mutually convenient times, and
would be reimbursed for direct expenses. Messrs. Eichenbaum and
Leff would not be required to be present at the offices of the
Company or the Buyer on any particular schedule, and would be free
to vacation and travel as they see fit, provided that they are
reasonably available for consultation with executives of the
Company and the Buyer in person or by telephone at mutually
convenient times. In the case of Mr. Leff, who is an attorney, the
services to be provided would not include specific legal services
but may include advice as to legal procedures followed by the
Company and other general advice on legal-related matters. The
liability of each of Mr. Eichenbaum and Mr. Leff to the Company or
the Buyer arising out of or in connection with his performance or
failure to perform such services would in no event exceed an amount
to be agreed upon in connection with his performance or failure to
perform such services in any year. Without limiting the foregoing,
Mr. Eichenbaum and Mr. Leff would have no liability to the Company
or the Buyer for consequential or special damages arising out of or
in connection with his performance or failure to perform such
services. Neither Mr. Eichenbaum nor Mr. Leff would have any
liability as a result of his failure to perform such services due
to death, disability, incapacity or any other cause beyond his
reasonable control. Neither Mr. Eichenbaum nor Mr. Leff would have
any liability arising out of or in connection with the other's
performance or failure to perform such services.
4. It would be a condition of the Shareholders'
obligation to close that the Buyer obtain releases of the personal
guarantees made by the Shareholders of the Company's bank debt.
5. (a) The Buyer, the Company and the appropriate
Shareholders would, effective upon the Closing, enter into an
agreement under which (i) the Company would purchase all equipment
it currently leases from an affiliate of the Voting Shareholders at
a purchase price equal to the amount such affiliate owes to Hudson
United Bank, and (ii) such affiliates would immediately repay such
indebtedness to Hudson United Bank. It is understood that certain
of such leased equipment is subleased by the Company to the law
firm of Eichenbaum, Kantrowitz, Leff & Gulko (the "Law Firm").
Notwithstanding the foregoing, such subleased equipment would not
be purchased by the Company and after the Closing would be directly
leased from affiliates of the Shareholders to the Law Firm.
(b) The Shareholders and their affiliates would
repay in full at or prior to January, 1995 (or such other time as
may be agreed upon) all outstanding indebtedness of any of them due
or to become due to the Company.
(c) The Voting Shareholders would use their best
efforts (i) to cause the Company's landlord to find a replacement
tenant as soon as practicable after the Closing such that the
Company would be able to vacate without continuing liability the
office building it occupies in Jersey City effective on a date in
the first half of 1995 selected by the Buyer or as soon as possible
thereafter, provided that the Voting Shareholders would not be
obligated to cause the landlord to accept a replacement tenant on
financial terms which are less advantageous overall to the landlord
than those of the current lease, and (ii) to cause all subtenants
of the Company to become direct tenants of the Company's landlord
at or before the Closing, with a corresponding reduction in the
Company's rent and amount of space.
6. The following would occur prior to the execution of
the Definitive Agreement:
(a) The Company and Hudson United Bank would
jointly (i) contact selected dealers of the Company, (ii) contact
the Company's employees to inform them of the proposed Purchase and
(iii) request that certain key employees execute Employment and
Non-Competition Agreements which would become effective only if and
when the Closing occurs;
(b) The Buyer would have completed and been
satisfied in its sole discretion with its review of the business,
records and properties and other assets of the Company; and
(c) All necessary board actions and/or corporate
approvals would have occurred or been received.
7. The details of carrying out the transactions des-
cribed above and the conditions and provisions thereof would be as
may be agreed upon by the parties and, if agreed upon, would be set
forth in the Definitive Agreement to be entered into by October 18,
1994 or as soon as practicable thereafter. The Definitive
Agreement would contain, among other provisions:
(a) A date for the Closing of November 1, 1994, or
as soon as practicable thereafter;
(b) Representations and warranties by the Company
and the Shareholders as to the assets, liabilities, results of
operations, financial statements, environmental situations and
compliance, and other matters relating to the Company and its
business;
(c) Indemnification from the Company and the
Shareholders with respect to liability (or claims with respect
thereto) for violations of law (including consumer protection
laws), misrepresentation, breach of warranty, and other matters,
with the escrow of a portion of the purchase price as security for
such indemnification (the amount and form of such escrow,
appropriate threshold and maximum indemnity amounts and appropriate
survival periods to be negotiated);
(d) Non-competition and non-disclosure agreements
from the Voting Shareholders;
(e) Conditions to the Closing including (i)
receipt of third party (including supplier, customer and lender)
consents, if necessary, and (ii) receipt of approvals, if neces-
sary, of banking authorities and other governmental entities,
including compliance to the extent required with the Hart-Scott-
Rodino Antitrust Improvements Act of 1976, as amended; and
(f) Such other provisions concerning the purchase
of a business of this type, including certificates and opinions and
other actions and documentation, as the parties would deem
appropriate, including but not limited to provisions pertaining to
the following: (i) company cars and office furnishings, (ii) split
dollar life insurance policies on the lives of the Voting
Shareholders, (iii) bonus/profit sharing arrangements with respect
to Messrs. Eichenbaum and Leff for 1994, (iv) payments to other
executives of the Company under bonus compensation agreements and
incentive plans for 1994, (v) termination of certain benefit plans
which are sponsored by the Company (and which in some cases are
jointly sponsored by the Law Firm), (vi) employee benefit issues
such as contributions to the Company's defined contribution plan
for 1994 and vesting and similar credit to be given Company
employees for purposes of the Buyer's benefit programs, and (vii)
participation by a representative of the Voting Shareholders in IRS
examinations of the Company for periods prior to the Closing; it
being understood that various items may result in adjustments to
the Purchase Price.
8. In order to enable the Buyer to make an investiga-
tion of the business and affairs of the Company, as soon as pos-
sible the Company will provide the Buyer and its financial advisor,
counsel, accountants, engineers and other representatives full
access (during normal business hours and on reasonable notice) to,
and complete information concerning, all aspects of the operations
of the Company, including all books, records (including tax returns
filed and those in preparation), customer lists, financial state-
ments, contracts, commitments and other documents or instruments of
the Company, as well as complete access (during normal business
hours and on reasonable notice) to all its properties, personnel
and independent certified public accountants, provided that on-site
access to the Company's facilities will be restricted until the
fact that the Company has entered into this Memorandum of Intent
has been made public. The Company will also cause its independent
certified public accountants to provide the Buyer and its financial
advisor, counsel, accountants and other representatives full access
to the audit work papers and other records pertaining to the
Company in the possession, custody or control of such independent
certified public accountants.
9. The Company will not, without the prior written
consent of the Buyer, engage in any transaction or any activity not
in the ordinary course of business.
10. Neither the Company and the Shareholders, nor any of
their respective representatives or agents, will solicit, entertain
or enter into any agreement or understanding or engage in any
discussions with any person or entity other than the Buyer or a
representative thereof with respect to the acquisition (by
purchase, merger or otherwise) of any or all of the capital stock,
assets or business of the Company. The Company and the Sharehold-
ers will immediately notify Hudson United Bank of any expression of
interest by any third party with respect to such an acquisition,
including the details thereof.
11. None of the parties hereto will, without the prior
consent of the other parties, issue any press releases, public
announcements, statements or reports regarding this Memorandum of
Intent or the transactions contemplated hereby, except as may be
required by law, including without limitation as may be required by
the regulations of the SEC or banking authorities.
12. The Buyer, and the Company and the Shareholders will
each separately bear their expenses, including fees of financial
advisors, brokers or finders and the fees and disbursements of
counsel and accountants, incurred in connection with this Memoran-
dum of Intent and the transactions contemplated hereby, whether or
not such transactions are consummated. Not in limitation of the
foregoing, the parties agree that no broker or finder or other
intermediary is involved in the proposed transaction. Each party
will indemnify and hold the other parties hereto harmless from any
claim by any third party for brokerage or finder's fees arising out
of the transactions contemplated hereunder based upon any action or
communication, or alleged action or communication, by the indemni-
fying party or any of his or its agents or representatives.
13. Subject to Section 15 hereof, this Memorandum of
Intent may be terminated at any time by any party hereto by written
notice to the other parties. In the event that this Memorandum of
Intent is terminated at any time after a public announcement of the
proposed Purchase has been made, the Company and the Voting
Shareholders will pay to Hudson United Bank (and will be jointly
and severally obligated to so pay), an amount in cash equal to the
Termination Fee (as hereinafter defined) if, within one year after
such termination, all or any substantial part of the capital stock,
assets or business of the Company is acquired by any person (other
than the Buyer) by means of a merger, stock purchase, asset pur-
chase or other business combination (the "Acquisition"). As used
in this Memorandum of Intent the "Termination Fee" shall mean (i)
where termination was by Hudson United Bank because of its failure
to be satisfied with the financial situation of the Company or
because Hudson United Bank does not have available sufficient
financial resources to consummate the Purchase, an amount equal to
zero (-0-); (ii) where the termination was by Hudson United Bank
for any other reason, an amount equal to fifty percent (50%) of the
Excess Amount, (iii) where termination was by the Company or either
of the Voting Shareholders, an amount equal to one hundred percent
(100%) of the Excess Amount. As used in this Memorandum of Intent,
the "Excess Amount" shall mean the excess of (A) the value of the
Company as indicated by the consideration for the Acquisition over
(B) the purchase price contained in Section 2 of this Memorandum of
Intent. Payment of the amounts due pursuant to this Section 13
shall be deemed to be liquidated damages and shall constitute
complete satisfaction of any and all claims of the Buyer on account
of such termination.
14. The Confidentiality Agreement dated as of August 16,
1994 between the Company and HUBCO, Inc. is hereby ratified and
confirmed and shall remain in full force and effect in accordance
with its terms. Hudson United Bank hereby agrees that it is bound
by said Confidentiality Agreement as fully as if it were a
signatory thereto. Disclosures pursuant to this Memorandum of
Intent shall be governed by the terms of said Confidentiality
Agreement, including without limitation Section 6 thereof.
15. This Memorandum of Intent and the parties' execution
hereof is not intended as, nor shall it create, a legally binding
commitment on the part of either party for any purpose, except that
(i) Sections 8 through 12 hereof shall be binding until this
Memorandum of Intent shall have been terminated by any party hereto
(and, if later, Section 10 hereof shall be binding after such
termination until October 30, 1994), and (ii) Sections 13 and 14
hereof shall be binding until and after any such termination. No
party shall be under any legal obligation with respect to the
transactions contemplated in Sections 1 through 7 of this
Memorandum of Intent or otherwise unless and until a mutually ac-
ceptable Definitive Agreement has been negotiated, approved by the
boards of directors of all corporate parties and by any other
authorities deemed necessary by such parties, and has been properly
executed and delivered by all parties intending to be bound there-
by. Until such execution and delivery of such a Definitive
Agreement, any party hereto may terminate all negotiation and
discussion of the subject matter hereof without recourse or
liability, except as set forth in Sections 13 and 14 hereof. The
understanding contained in this paragraph is intended by the
parties to control over any contrary or inconsistent statement,
whether written or oral and to whomever made, or any action or
course of conduct, whether such statement, action or course of
conduct has occurred or occurs hereafter.
16. This Memorandum of Intent may be executed in two or
more counterparts and by the different parties hereto on separate
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
Dated: October 6, 1994 HUDSON UNITED BANK
By:
Name: Kenneth T. Neilson
Title: President
Dated: October 6, 1994 SHOPPERS CHARGE ACCOUNTS CO.
By:
Name: David Leff
Title: President
Dated: October 6, 1994
BERNARD EICHENBAUM
Dated: October 6, 1994
DAVID LEFF
<PAGE>
Exhibit 99.5 - Agreement and Plan of Merger dated October 7, 1994
between HUBCO, Hudson United Bank and Jefferson
National Bank.
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated October 7, 1994
("Agreement"), among HUBCO, Inc. ("Hubco"), a New Jersey
corporation and registered bank holding company, Hudson United Bank
(the "Bank"), a New Jersey chartered commercial banking
corporation, wholly-owned by Hubco, and Jefferson National Bank, a
national banking association ("Jefferson").
WHEREAS, Hubco desires to acquire Jefferson and
Jefferson's Board of Directors has determined, based upon the terms
and conditions hereinafter set forth, that the acquisition is in
the best interests of Jefferson and its stockholders. The
acquisition will be accomplished by merging Jefferson with and into
the Bank with the Bank surviving,
WHEREAS, the Boards of Directors of Jefferson, Hubco
and the Bank have duly adopted and approved this Agreement and the
Board of Directors of Jefferson has directed that it be submitted
to Jefferson's shareholders for approval,
NOW, THEREFORE, intending to be legally bound, the
parties hereto hereby agree as follows:
ARTICLE I - THE MERGER
1.1. The Merger. Subject to the terms and
conditions of this Agreement, at the Effective Time (as hereinafter
defined), Jefferson shall be merged with and into the Bank (the
"Merger") in accordance with the New Jersey Banking Act of 1948, as
amended, and the National Bank Act and the Bank shall be the
surviving bank (the "Surviving Corporation"), the name of which
shall be Hudson United Bank. The principal office of the Surviving
Corporation shall be the principal office of the Bank. Exhibit 1
to this Agreement lists (i) the locations of the principal offices
of and branch offices of Jefferson and the Bank; (ii) the locations
of all branch offices and the main office of the Surviving
Corporation; and (iii) the amount of the capital stock, the number
of shares, the par value and the amount of surplus of the Surviving
Corporation.
1.2. Effect of the Merger. At the Effective Time,
the Surviving Corporation shall be considered the same business and
corporate entity as each of the Bank and Jefferson and thereupon
and thereafter, all the property, rights, privileges, powers and
franchises of each of the Bank and Jefferson shall vest in the
Surviving Corporation and the Surviving Corporation shall be
subject to and be deemed to have assumed all of the debts,
liabilities, obligations and duties of each of the Bank and
Jefferson and shall have succeeded to all of each of their
relationships, as fully and to the same extent as if such property,
rights, privileges, powers, franchises, debts, liabilities,
obligations, duties and relationships had been originally acquired,
incurred or entered into by the Surviving Corporation. In
addition, any reference to either of the Bank or Jefferson in any
contract or document, whether executed or taking effect before or
after the Effective Time, shall be considered a reference to the
Surviving Corporation if not inconsistent with the other provisions
of the contract or document; and any pending action or other
judicial proceeding to which either of the Bank or Jefferson is a
party, shall not be deemed to have abated or to have discontinued
by reason of the Merger, but may be prosecuted to final judgment,
order or decree in the same manner as if the Merger had not been
made, or the Surviving Corporation may be substituted as a party to
such action or proceeding, and any judgment, order or decree may be
rendered for or against it that might have been rendered for or
against either of the Bank or Jefferson as if the Merger had not
occurred.
1.3. Certificate of Incorporation. As of the
Effective Time, the certificate of incorporation of the Bank as it
exists at the Effective Time shall be the certificate of
incorporation of the Surviving Corporation and shall not be amended
by this Agreement or the Merger.
1.4. By-laws. As of the Effective Time, the By-
laws of the Bank shall be the By-laws of the Surviving Corporation
until otherwise amended as provided by law.
1.5. Directors and Officers. As of the Effective
Time, the directors and officers of the Bank shall become the
directors and officers of the Surviving Corporation. The names of
the current directors and officers of the Bank are listed on
Exhibit 1.
1.6. Effective Time and Closing. The Merger shall
become effective (and be consummated) upon the date specified in a
notice from the Bank to the Federal Deposit Insurance Corporation
("FDIC") and in the date specified in the certification required by
Section 137 of the New Jersey Banking Act of 1948, as amended, to
be filed with the New Jersey Department of Banking (the
"Department") after approval by the Commissioner of the Department
(the "Commissioner") (the "Effective Time"). The notice from the
Bank to the FDIC and the certification filed with the Department
specifying the Effective Time shall require the approval of
Jefferson, which approval will not be unreasonably withheld, and
shall be consistent with this section. A closing (the "Closing")
shall take place prior to the Effective Time at 10:00 a.m., 10 days
(or the first business day thereafter) following the receipt of all
necessary regulatory and governmental approvals and consents and
the expiration of all statutory waiting periods in respect thereof
and the satisfaction or waiver of all of the conditions to the
consummation of the Merger specified in Article VI hereof (other
than the delivery of certificates, opinions and other instruments
and documents to be delivered at the Closing), at the offices of
Pitney, Hardin, Kipp & Szuch, 200 Campus Drive, Florham Park, New
Jersey, or at such other place, time or date as Hubco and Jefferson
may mutually agree upon. The notice from the Bank to the FDIC and
the certification filed with the Department shall specify as the
Effective Time of the Merger a date, immediately following the
Closing, agreed to by the Bank and Jefferson. Following the
execution of this Agreement, the Bank and Jefferson shall, if
required or advised to do so by applicable regulatory authorities,
execute and deliver a simplified bank merger agreement, both in
form and substance reasonably satisfactory to the parties hereto
and consistent with the terms hereof, for delivery to the
Commissioner, the FDIC and the Comptroller of the Currency (the
"Comptroller") in connection with the approval of the Merger by the
regulatory authorities.
ARTICLE II - CONVERSION OF JEFFERSON SHARES
2.1. Conversion of Jefferson Common Stock. Each
share of common stock, par value $6.00 per share, of Jefferson
("Jefferson Common Stock"), issued and outstanding immediately
prior to the Effective Time (other than Dissenting Shares as
defined in Section 2.4) shall, by virtue of the Merger and without
any action on the part of the holder thereof, be converted as
follows:
(a) Exchange Ratio. Subject to the provisions of
this Section 2.1, each share of Jefferson Common Stock issued and
outstanding immediately prior to the Effective Time (excluding any
treasury shares, shares held by Hubco and Dissenting Shares) shall
be converted at the Effective Time into the right to receive 1.91
shares (the "Exchange Ratio") of common stock, without par value,
of Hubco ("Hubco Common Stock"). In the event that prior to
Closing a dispute arises between Jefferson and one or more of
Jefferson's vendors pursuant to which such vendors assert in
writing that their contractual arrangements with Jefferson extend
for a period of time beyond the time that Jefferson's counsel had
advised Hubco (prior to the date hereof) that such arrangements
extend, the Exchange Ratio set forth in this Section 2.1(a) shall
be adjusted such that the Exchange Ratio pursuant to this Section
2.1(a) shall equal (i) the excess of $43.00 over the Per Share
Reduction (as hereafter defined) divided by (ii) $22.48. The "Per
Share Reduction" shall equal the Dollar Amount (as hereinafter
defined) divided by the number of outstanding shares of Jefferson
Common Stock at the Effective Time. The "Dollar Amount" shall
equal the Excess Legal Fees (as hereinafter defined) plus the
lesser of (but not less than zero) (a) $70,000.00 or (b) the dollar
amount of expenses, beyond the expenses that Jefferson has advised
Hubco (prior to the date hereof) that Jefferson must incur in order
to terminate such contractual arrangements, that Jefferson is
"required" to pay in order to terminate such contracts. For
purposes of the preceding sentence of this Agreement, Jefferson
shall be deemed to be required to pay a particular amount upon
termination if (w) a court of competent jurisdiction (prior to any
appeal unless such appeal is concluded prior to the Effective Time)
determines that Jefferson is required to pay a specific amount
(which amount may be zero) in order to terminate such arrangements,
or (x) in the absence of such court order, the amount that
Jefferson and such vendors agree Jefferson is required to pay to
terminate such arrangements or (y) in the absence of such order or
agreement, the amount which an authorized representative of such
vendors indicates in writing (on or before the Closing) Jefferson
must pay in order to terminate such arrangements, or (z), in the
absence of the conditions specified in clauses "w", "x" and "y",
the amount of $70,000.00. "Excess Legal Fees" means all attorneys'
fees and expenses in excess of $15,000.00 incurred by Jefferson
after the date hereof and prior to the Effective Time in an effort
to resolve such disputes.
(b) Capital Changes. If between the date of this
Agreement and the Effective Time the outstanding shares of Hubco
Common Stock shall have been changed into a different number of
shares or a different class, by reason of any stock dividend, stock
split, reclassification, recapitalization, combination or exchange
of shares, the Exchange Ratio, and the Upper and Lower Adjustment
Prices (as hereinafter defined), shall be correspondingly adjusted
to reflect such stock dividend, stock split, reclassification,
recapitalization, combination or exchange of shares.
(c) Exchange Ratio Adjustments. The Exchange Ratio
shall be adjusted upward if the Median Pre-Closing Price (as
hereinafter defined) of Hubco Common Stock is less than $19.34 per
share (the "Lower Adjustment Price"). The Exchange Ratio shall be
adjusted downward if the Median Pre-Closing Price exceeds $26.16
per share (the "Upper Adjustment Price"). In the event the
Exchange Ratio is adjusted in accordance with the prior sentences,
the new Exchange Ratio shall be calculated as follows: (1) if the
Median Pre-Closing Price is less than $19.34 per share, the new
Exchange Ratio shall be determined by (a) multiplying the Lower
Adjustment Price by the old Exchange Ratio and (b) dividing that
number by the Median Pre-Closing Price; or (2) if the Median Pre-
Closing Price is more than $26.16, the new Exchange Ratio shall be
determined by (a) multiplying the Upper Adjustment Price by the old
Exchange Ratio and (b) dividing that number by the Median Pre-
Closing Price. In either case, the new Exchange Ratio shall be
rounded to the nearest one-thousandth.
The Median Pre-Closing Price of Hubco Common Stock
shall mean the Median Price (as hereinafter defined) calculated
based upon the Closing Price (as hereinafter defined) of Hubco
Common Stock during the first 20 of the 25 consecutive trading days
immediately preceding the date of the Closing. The Closing Price
shall mean the closing price of Hubco Common Stock as supplied by
the National Association of Securities Dealers Automated Quotation
System and published in The Wall Street Journal during the first 20
of the 25 consecutive trading days immediately preceding the date
of the Closing. The Median Price shall be determined by taking the
price half-way between the Closing Prices left after discarding the
9 lowest and 9 highest Closing Prices in the 20 day period. A
trading day shall mean a day for which a Closing Price is so
supplied and published.
(d) Cancellation of Jefferson Certificates. After
the Effective Time, all such shares of Jefferson Common Stock
(other than those cancelled pursuant to Section 2.1(e)) shall no
longer be outstanding and shall automatically be cancelled and
retired and shall cease to exist, and each certificate previously
evidencing any such shares (other than Dissenting Shares and those
cancelled pursuant to Section 2.1(e)) shall thereafter represent
the right to receive the Merger Consideration (as defined in
Section 2.2(b)). The holders of such certificates previously
evidencing such shares of Jefferson Common Stock outstanding
immediately prior to the Effective Time shall cease to have any
rights with respect to such shares of Jefferson Common Stock except
as otherwise provided herein or by law. Such certificates
previously evidencing such shares of Jefferson Common Stock (other
than Dissenting Shares and those cancelled pursuant to Section
2.1(e)) shall be exchanged for certificates evidencing shares of
Hubco Common Stock issued pursuant to this Article II, upon the
surrender of such certificates in accordance with this Article II.
No fractional shares of Hubco Common Stock shall be issued, and, in
lieu thereof, a cash payment shall be made pursuant to Section
2.2(e).
(e) Treasury Shares. All shares of Jefferson
Common Stock held by Jefferson in its treasury or owned by Hubco or
the Bank (other than shares held as trustee or in a fiduciary
capacity and shares held as collateral on or in lieu of a debt
previously contracted) immediately prior to the Effective Time
shall be cancelled.
2.2. Exchange of Certificates.
(a) Exchange Agent. As of the Effective Time,
Hubco shall deposit, or shall cause to be deposited, with a bank or
trust company designated by Hubco, which may be Hudson United Bank,
Trust Department (the "Exchange Agent"), for the benefit of the
holders of shares of Jefferson Common Stock, for exchange in
accordance with this Article II, through the Exchange Agent,
certificates evidencing shares of Hubco Common Stock and cash in
such amount such that the Exchange Agent possesses such number of
shares of Hubco Common Stock and such amount of cash as are
required to provide all of the consideration required to be
exchanged by Hubco pursuant to the provisions of this Article II
(such certificates for shares of Hubco Common Stock, together with
any dividends or distributions with respect thereto, and cash being
hereinafter referred to as the "Exchange Fund"). The Exchange
Agent shall, pursuant to irrevocable instructions, deliver the
Hubco Common Stock and cash out of the Exchange Fund in accordance
with Section 2.1. Except as contemplated by Section 2.2(f) hereof,
the Exchange Fund shall not be used for any other purpose.
(b) Exchange Procedures. As soon as reasonably
practicable either before or after the Effective Time, Hubco will
instruct the Exchange Agent to mail to each holder of record of a
certificate or certificates which immediately prior to the
Effective Time evidenced outstanding shares of Jefferson Common
Stock (other than Dissenting Shares) (the "Certificates"), (i) a
letter of transmittal (which is reasonably agreed to by Hubco and
Jefferson and shall specify that delivery shall be effected, and
risk of loss and title to the Certificates shall pass, only upon
proper delivery of the Certificates to the Exchange Agent and shall
be in such form and have such other provisions as Hubco may
reasonably specify) and (ii) instructions for use in effecting the
surrender of the Certificates in exchange for certificates
evidencing shares of Hubco Common Stock. Upon surrender of a
Certificate for cancellation to the Exchange Agent together with
such letter of transmittal, duly executed, and such other customary
documents as may be required pursuant to such instructions, the
holder of such Certificate shall be entitled to receive in exchange
therefor (A) certificates evidencing that number of whole shares of
Hubco Common Stock which such holder has the right to receive in
respect of the shares of Jefferson Common Stock formerly evidenced
by such Certificate in accordance with Section 2.1, (B) cash in
lieu of fractional shares of Hubco Common Stock to which such
holder may be entitled pursuant to Section 2.2(e) and (C) any
dividends or other distributions to which such holder is entitled
pursuant to Section 2.2(c) (the shares of Hubco Common Stock,
dividends, distributions and cash described in clauses (A), (B) and
(C) being collectively, the "Merger Consideration") and the
Certificate so surrendered shall forthwith be cancelled. In the
event of a transfer of ownership of shares of Jefferson Common
Stock which is not registered in the transfer records of Jefferson,
a certificate evidencing the proper number of shares of Hubco
Common Stock and/or cash may be issued and/or paid in accordance
with this Article II to a transferee if the Certificate evidencing
such shares of Jefferson Common Stock is presented to the Exchange
Agent, accompanied by all documents required to evidence and effect
such transfer and by evidence that any applicable stock transfer
taxes have been paid. Until surrendered as contemplated by this
Section 2.2, each Certificate shall be deemed at any time after the
Effective Time to evidence only the right to receive upon such
surrender the Merger Consideration.
(c) Distributions with Respect to Unexchanged
Shares of Hubco Common Stock. No dividends or other distributions
declared or made after the Effective Time with respect to Hubco
Common Stock with a record date after the Effective Time shall be
paid to the holder of any unsurrendered Certificate with respect to
the shares of Hubco Common Stock evidenced thereby, and no other
part of the Merger Consideration shall be paid to any such holder,
until the holder of such Certificate shall surrender such
Certificate. Subject to the effect of applicable laws, following
surrender of any such Certificate, there shall be paid to the
holder of the certificates evidencing shares of Hubco Common Stock
issued in exchange therefor, without interest, (i) promptly, the
amount of any cash payable with respect to a fractional share of
Hubco Common Stock to which such holder may have been entitled
pursuant to Section 2.2(e) and the amount of dividends or other
distributions with a record date after the Effective Time
theretofore paid with respect to such shares of Hubco Common Stock,
and (ii) at the appropriate payment date, the amount of dividends
or other distributions, with a record date after the Effective Time
but prior to surrender and a payment date occurring after
surrender, payable with respect to such shares of Hubco Common
Stock. No interest shall be paid on the Merger Consideration.
(d) No Further Rights in Jefferson Common Stock.
All shares of Hubco Common Stock issued and cash paid upon
conversion of the shares of Jefferson Common Stock in accordance
with the terms hereof shall be deemed to have been issued or paid
in full satisfaction of all rights pertaining to such shares of
Jefferson Common Stock.
(e) No Fractional Shares. No certificates or scrip
evidencing fractional shares of Hubco Common Stock shall be issued
upon the surrender for exchange of Certificates and such fractional
share interests will not entitle the owner thereof to vote or to
any rights of a stockholder of Hubco. Cash shall be paid in lieu
of fractional shares of Hubco Common Stock, based upon the Median
Pre-Closing Price of Hubco Common Stock (as previously defined).
(f) Termination of Exchange Fund. Any portion of
the Exchange Fund which remains undistributed to the holders of
Jefferson Common Stock for two years after the Effective Time shall
be delivered to Hubco, upon demand, and any holders of Jefferson
Common Stock who have not theretofore complied with this Article II
shall thereafter look only to Hubco for the Merger Consideration to
which they are entitled.
(g) No Liability. Neither Hubco nor the Bank shall
be liable to any holder of shares of Jefferson Common Stock for any
such shares of Hubco Common Stock or cash (or dividends or
distributions with respect thereto) delivered to a public official
pursuant to any applicable abandoned property, escheat or similar
law.
(h) Withholding Rights. Hubco shall be entitled to
deduct and withhold, or cause the Exchange Agent to deduct and
withhold, from the consideration otherwise payable pursuant to this
Agreement to any holder of shares of Jefferson Common Stock, the
minimum amounts (if any) that Hubco is required to deduct and
withhold with respect to the making of such payment under the Code
(as defined in Section 3.8), or any provision of state, local or
foreign tax law. To the extent that amounts are so withheld by
Hubco, such withheld amounts shall be treated for all purposes of
this Agreement as having been paid to the holder of the shares of
Jefferson Common Stock in respect of which such deduction and
withholding was made by Hubco.
2.3. Stock Transfer Books. At the Effective Time,
the stock transfer books of Jefferson shall be closed and there
shall be no further registration of transfers of shares of
Jefferson Common Stock thereafter on the records of Jefferson. On
or after the Effective Time, any Certificates presented to the
Exchange Agent or Hubco for transfer shall be converted into the
Merger Consideration.
2.4. Dissenting Shares. Notwithstanding anything
in this Agreement to the contrary, any holder of Jefferson Common
Stock shall have the right to dissent in the manner provided in the
National Bank Act, 12 U.S.C. 214a(b), and if all necessary
requirements of the National Bank Act are met, such shares shall be
entitled to payment in cash from the Bank of the fair value of such
shares as determined in accordance with the National Bank Act. All
shares of Jefferson Common Stock as to which the holder properly
exercises dissenters' rights in accordance with the National Bank
Act shall constitute "Dissenting Shares" unless and until such
rights are waived, by the party initially seeking to exercise such
rights.
2.5. Bank Common Stock. The shares of common stock
of the Bank outstanding immediately prior to the Effective Time
shall not be effected by the Merger but shall be the same number of
shares of the Surviving Corporation.
ARTICLE III - REPRESENTATIONS AND WARRANTIES OF JEFFERSON
References herein to the "Jefferson Disclosure
Schedule" shall mean all of the disclosure schedules required by
this Article III, dated as of the date hereof and referenced to the
specific sections and subsections of Article III of this Agreement,
which have been delivered on the date hereof by Jefferson to Hubco.
Jefferson hereby represents and warrants to Hubco and the Bank as
follows:
3.1. Corporate Organization.
(a) Jefferson is a national banking association
duly organized, validly existing and in good standing under the
laws of the United States. Jefferson has the corporate power and
authority to own or lease all of its properties and assets and to
carry on its business as it is now being conducted, and is duly
licensed or qualified to do business and is in good standing in
each jurisdiction in which the nature of the business conducted by
it or the character or location of the properties and assets owned
or leased by it makes such licensing or qualification necessary,
except where the failure to be so licensed, qualified or in good
standing would not have a material adverse effect on the business,
operations, assets or financial condition of Jefferson.
(b) Except as set forth in the Jefferson Disclosure
Schedule, Jefferson has no Subsidiaries. When used with reference
to Jefferson, the term "Subsidiary" means any corporation,
partnership, joint venture or other legal entity in which
Jefferson, directly or indirectly, owns at least a 50 percent stock
or other equity interest or for which Jefferson, directly or
indirectly, acts as a general partner. All eligible accounts of
depositors issued by Jefferson are insured by the FDIC to the
fullest extent permitted by law. The Jefferson Disclosure Schedule
sets forth true and complete copies of the Articles of Association
and By-laws of Jefferson, as in effect on the date hereof.
(c) Any Subsidiary is a corporation incorporated
under the laws of the State of New Jersey. Any Subsidiary has not
engaged in business or undertaken any activities (other than the
activity of incorporating itself).
3.2. Capitalization. The authorized capital stock
of Jefferson consists of 500,000 shares of Jefferson Common Stock.
As of the date hereof, there are 226,078 shares of Jefferson Common
Stock issued and outstanding. All issued and outstanding shares of
Jefferson Common Stock have been duly authorized and validly
issued, are fully paid and no assessment has been made on such
shares. Jefferson has not granted and is not bound by any
outstanding subscriptions, options, warrants, calls, commitments or
agreements of any character calling for the transfer, purchase,
subscription or issuance of any shares of capital stock of
Jefferson or any securities representing the right to purchase,
subscribe or otherwise receive any shares of such capital stock or
any securities convertible into any such shares, and there are no
agreements or understandings with respect to voting of any such
shares.
3.3. Authority; No Violation.
(a) Subject to the approval of this Agreement and
the transactions contemplated hereby by the stockholders of
Jefferson, Jefferson has the full corporate power and authority to
execute and deliver this Agreement and to consummate the
transactions contemplated hereby in accordance with the terms
hereof. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly
and validly approved by the Board of Directors of Jefferson in
accordance with the Articles of Association of Jefferson and
applicable laws and regulations. Except for such approval, no
other corporate proceedings on the part of Jefferson are necessary
to consummate the transactions so contemplated. This Agreement has
been duly and validly executed and delivered by Jefferson and
constitutes the valid and binding obligation of Jefferson,
enforceable against Jefferson in accordance with its terms.
(b) Neither the execution and delivery of this
Agreement by Jefferson, nor the consummation by Jefferson of the
transactions contemplated hereby in accordance with the terms
hereof, or compliance by Jefferson with any of the terms or
provisions hereof, will (i) violate any provision of Jefferson's
Articles of Association or By-laws, (ii) assuming that the consents
and approvals set forth below are duly obtained, violate any
statute, code, ordinance, rule, regulation, judgment, order, writ,
decree or injunction applicable to Jefferson or any of its
properties or assets, or (iii) except as set forth in the Jefferson
Disclosure Schedule, violate, conflict with, result in a breach of
any provision of, constitute a default (or an event which, with
notice or lapse of time, or both, would constitute a default)
under, result in the termination of, accelerate the performance
required by, or result in the creation of any lien, security
interest, charge or other encumbrance upon any of the properties or
assets of Jefferson under, any of the terms, conditions or
provisions of any note, bond, mortgage, indenture, deed of trust,
license, lease, agreement or other instrument or obligation to
which Jefferson is a party, or by which it or any of its properties
or assets may be bound or affected, except, with respect to (ii)
and (iii) above, such as individually or in the aggregate will not
have a material adverse effect on the business, operations, assets
or financial condition of Jefferson and which will not prevent or
delay the consummation of the transactions contemplated hereby.
Except for consents and approvals of or filings or registrations
with or notices to or required by the FDIC, the Commissioner, the
Department, the Comptroller, the New Jersey Department of
Environmental Protection and Energy ("DEPE"), the Securities and
Exchange Commission ("SEC"), state blue sky authorities or other
applicable governmental authorities, and the stockholders of
Jefferson, no consents or approvals of or filings or registrations
with or notices to any third party or any public body or authority
are necessary on behalf of Jefferson in connection with (x) the
execution and delivery by Jefferson of this Agreement and (y) the
consummation by Jefferson of the Merger and the other transactions
contemplated hereby, except such as are listed in the Jefferson
Disclosure Schedule and as individually or in the aggregate will
not (if not obtained) have a material adverse effect on the
business, operations, assets or financial condition of Jefferson or
prevent or delay the consummation of the transactions contemplated
hereby. To the best of Jefferson's knowledge, no fact or condition
exists which Jefferson has reason to believe will prevent it from
obtaining the aforementioned consents or approvals.
3.4. Financial Statements.
(a) The Jefferson Disclosure Schedule sets forth
copies of the statements of condition of Jefferson as of December
31, 1993 and 1992, and the related statements of operations,
changes in shareholders' equity and cash flows for the periods
ended December 31, in each of the three years 1991 through 1993, in
each case accompanied by the audit report (which report includes
explanatory paragraphs relating to certain regulatory matters) of
Arthur Andersen & Co. or Barry N. Rein & Associates, independent
public accountants with respect to Jefferson, and the unaudited
statements of condition of Jefferson as of March 31, 1994 and June
30, 1994 as filed with the Comptroller (collectively, the
"Jefferson Financial Statements"). Except for the absence of notes
with respect to interim financial statements, the Jefferson
Financial Statements (including the related notes) have been
prepared in accordance with generally accepted accounting
principles ("GAAP") consistently applied during the periods
involved (except as may be indicated therein or in the notes
thereto), and fairly present the financial position of Jefferson as
of the respective dates set forth therein, and the related
statements of operations, changes in shareholders' equity and cash
flows fairly present the results of operations, changes in
stockholders' equity and cash flows of Jefferson for the respective
fiscal periods set forth therein.
(b) The books and records of Jefferson are being
maintained in material compliance with applicable legal and
accounting requirements, and reflect only actual transactions.
(c) Except as and to the extent reflected,
disclosed or reserved against in the Jefferson Financial Statements
(including the notes thereto), as of June 30, 1994, Jefferson had
no liabilities, whether absolute, accrued, contingent or otherwise,
material to the business, operations, assets or financial condition
of Jefferson which were required by GAAP (consistently applied) to
be disclosed in Jefferson's statement of condition as of June 30,
1994. Since June 30, 1994, Jefferson has not incurred any
liabilities except in the ordinary course of business and
consistent with prudent banking practice, except as related to the
transactions contemplated by this Agreement.
3.5. Broker's and Other Fees. Except for Capital
Consultants of Princeton, Inc., neither Jefferson nor any of its
directors or officers has employed any broker or finder or incurred
any liability for any broker's or finder's fees or commissions in
connection with any of the transactions contemplated by this
Agreement. The agreement with Capital Consultants of Princeton,
Inc. is set forth in the Jefferson Disclosure Schedule. There are
no fees (other than time charges billed at usual and customary
rates) payable to any consultants, including lawyers and
accountants, in connection with this transaction or which would be
triggered by consummation of this transaction or the termination of
the services of such consultants by Jefferson.
3.6. Absence of Certain Changes or Events.
(a) Except as set forth in the Jefferson Disclosure
schedule, there has not been any material adverse change in the
business, operations, assets or financial condition of Jefferson
since June 30, 1994 and to the best of Jefferson's knowledge, no
facts or condition exists which Jefferson believes will cause such
a material adverse change in the future.
(b) Except as set forth in the Jefferson Disclosure
Schedule, Jefferson has not taken or permitted any of the actions
set forth in Section 5.2 hereof between June 30, 1994 and the date
hereof and, except for execution of this Agreement and the
agreement described in Section 3.5, Jefferson has conducted its
business only in the ordinary course, consistent with past
practice.
3.7. Legal Proceedings. Except as disclosed in the
Jefferson Disclosure Schedule, and except for ordinary routine
litigation incidental to the business of Jefferson, Jefferson is
not a party to any, and there are no pending or, to the best of
Jefferson's knowledge, threatened legal, administrative, arbitral
or other proceedings, claims, actions or governmental
investigations of any nature against Jefferson which, if decided
adversely to Jefferson, would have a material adverse effect on the
business, operations, assets or financial condition of Jefferson.
Except as disclosed in the Jefferson Disclosure Schedule, Jefferson
is not a party to any order, judgment or decree entered in any
lawsuit or proceeding.
3.8. Taxes and Tax Returns.
(a) Jefferson has duly filed (and until the
Effective Time will so file) all returns, declarations, reports,
information returns and statements ("Returns") required to be filed
by it in respect of any federal, state and local taxes (including
withholding taxes, penalties or other payments required) and has
duly paid (and until the Effective Time will so pay) all such taxes
due and payable, other than taxes or other charges which are being
contested in good faith (and disclosed to Hubco in writing).
Jefferson has established (and until the Effective Time will
establish) on its books and records reserves that are adequate for
the payment of all federal, state and local taxes not yet due and
payable, but are incurred in respect of Jefferson through such
date. The Jefferson Disclosure Schedule identifies the federal
income tax returns of Jefferson which have been examined by the
Internal Revenue Service (the "IRS") within the past six years. No
deficiencies were asserted as a result of such examinations which
have not been resolved and paid in full. The Jefferson Disclosure
Schedule identifies the applicable state income tax returns of
Jefferson which have been examined by the applicable authorities
within the past six years. No deficiencies were asserted as a
result of such examinations which have not been resolved and paid
in full. To the best knowledge of Jefferson, there are no audits
or other administrative or court proceedings presently pending nor
any other disputes pending with respect to, or claims asserted for,
taxes or assessments upon Jefferson, nor has Jefferson given any
currently outstanding waivers or comparable consents regarding the
application of the statute of limitations with respect to any taxes
or Returns.
(b) Except as set forth in the Jefferson Disclosure
Schedule, Jefferson (i) has not requested any extension of time
within which to file any Return which Return has not since been
filed, (ii) is not a party to any agreement providing for the
allocation or sharing of taxes, (iii) is not required to include in
income any adjustment pursuant to Section 481(a) of the Internal
Revenue Code of 1986, as amended (the "Code"), by reason of a
voluntary change in accounting method initiated by Jefferson (nor
does Jefferson have any knowledge that the IRS has proposed any
such adjustment or change of accounting method) and (iv) has not
filed a consent pursuant to Section 341(f) of the Code or agreed to
have Section 341(f)(2) of the Code apply.
3.9. Employee Benefit Plans.
(a) Except as disclosed in the Jefferson Disclosure
Schedule, Jefferson does not maintain or contribute to any
"employee pension benefit plan" (the "Jefferson Pension Plans"),
within the meaning of Section 3(2)(A) of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), "employee
welfare benefit plan" within the meaning of Section 3(1) of ERISA
(the "Jefferson Welfare Plans"), stock option plan, stock purchase
plan, deferred compensation plan, severance plan, bonus plan,
employment agreement or other similar plan, program or arrangement.
Jefferson has not, since September 2, 1974, contributed to any
"Multiemployer Plan", as such term is defined in Section 3(37) of
ERISA.
(b) Except as disclosed in the Jefferson Disclosure
Schedule, Jefferson has delivered to Hubco in the Jefferson
Disclosure Schedule a complete and accurate copy of each of the
following with respect to each of the Jefferson Pension Plans and
Jefferson Welfare Plans, if any: (1) plan document, summary plan
description, and summary of material modifications (if not
available, a detailed description of the foregoing); (ii) trust
agreement or insurance contract, if any; (iii) most recent IRS
determination letter, if any; (iv) most recent actuarial report, if
any; and (v) most recent annual report on Form 5500.
(c) The present value of all accrued benefits under
each of the Jefferson Pension Plans subject to Title IV of ERISA,
based upon the actuarial assumptions used for purposes of the most
recent actuarial valuation prepared by such Jefferson Pension
Plan's actuary, did not exceed the then current value of the assets
of such plans allocable to such accrued benefits.
(d) During the last five years, the Pension Benefit
Guaranty Corporation ("PBGC") has not asserted any claim for
liability against Jefferson or any of its Subsidiaries which has
not been paid in full.
(e) All premiums (and interest charges and
penalties for late payment, if applicable) due to the PBGC with
respect to each Jefferson Pension Plan have been paid. All
contributions required to be made to each Jefferson Pension Plan
under the terms thereof, ERISA or other applicable law have been
timely made, and all amounts properly accrued to date as
liabilities of Jefferson which have not been paid have been
properly recorded on the books of Jefferson.
(f) Except as disclosed in the Jefferson Disclosure
Schedule, each of the Jefferson Pension Plans, the Jefferson
Welfare Plans and each other plan and arrangement identified on the
Jefferson Disclosure Schedule has been operated in compliance in
all material respects with the provisions of ERISA, the Code, all
regulations, rulings and announcements promulgated or issued
thereunder, and all other applicable governmental laws and
regulations. Furthermore, if Jefferson maintains any Jefferson
Pension Plan, Jefferson intends to apply, if necessary, for, or the
IRS has issued, a favorable determination letter with respect to
such Jefferson Pension Plan and, except as disclosed in the
Jefferson Disclosure Schedule, Jefferson is not aware of any fact
or circumstance which would disqualify any plan, that could not be
retroactively corrected (in accordance with the procedures of the
IRS).
(g) To the best knowledge of Jefferson, no non-
exempt prohibited transaction, within the meaning of Section 4975
of the Code or Section 406 of ERISA, has occurred with respect to
any of the Jefferson Welfare Plans or Jefferson Pension Plans.
(h) No Jefferson Pension Plan or any trust created
thereunder has been terminated, nor have there been any "reportable
events", within the meaning of Section 4034(b) of ERISA, with
respect to any of the Jefferson Pension Plans.
(i) No "accumulated funding deficiency", within the
meaning of Section 412 of the Code, has been incurred with respect
to any of the Jefferson Pension Plans.
(j) There are no pending or, to the best knowledge
of Jefferson, threatened or anticipated claims (other than routine
claims for benefits) by, on behalf of or against any of the
Jefferson Pension Plans or the Jefferson Welfare Plans, any trusts
created thereunder or any other plan or arrangement identified in
the Jefferson Disclosure Schedule.
(k) Except as disclosed in the Jefferson Disclosure
Schedule, no Jefferson Pension Plan or Jefferson Welfare Plan
provides medical or death benefits (whether or not insured) beyond
an employee's retirement or other termination of service, other
than (i) coverage mandated by law, or (ii) death benefits under any
Jefferson Pension Plan.
(l) Except with respect to customary health, life
and disability benefits or as disclosed in the Jefferson Disclosure
Schedule, there are no unfunded benefit obligations which are not
accounted for by reserves shown on the financial statements and
established under GAAP or otherwise noted on such financial
statements.
(m) With respect to each Jefferson Pension Plan and
Jefferson Welfare Plan that is funded wholly or partially through
an insurance policy, there will be no liability of Jefferson as of
the Effective Time under any such insurance policy or ancillary
agreement with respect to such insurance policy in the nature of a
retroactive rate adjustment, loss sharing arrangement or other
actual or contingent liability arising wholly or partially out of
events occurring prior to the Effective Time.
(n) Except as set forth in the Jefferson Disclosure
Schedule or as agreed to by Hubco in writing either pursuant to
this Agreement or otherwise, the consummation of the transactions
contemplated by this Agreement will not (i) entitle any current or
former employee of Jefferson to severance pay, unemployment
compensation or any similar payment, (ii) accelerate the time of
payment, vesting, or increase the amount, of any compensation due
to any current employee or former employee under any Jefferson
Pension Plan or Jefferson Welfare Plan, or (iii) result in payments
not deductible by reason of Section 280G of the Code.
3.10. Reports.
(a) The Jefferson Disclosure Schedule lists, and
Jefferson has previously delivered to Hubco a complete copy of,
each communication (other than general advertising materials and
press releases) mailed by Jefferson to its stockholders as a class
since September 30, 1991, and each such communication, as of its
date, complied in all material respects with all applicable
statutes, rules and regulations and did not contain any untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the
statements made therein, in light of the circumstances under which
they were made, not misleading; provided that information as of a
later date shall be deemed to modify information as of an earlier
date.
(b) Jefferson has, since January 1, 1992, duly
filed with the Comptroller in form which was correct in all
material respects the monthly, quarterly and annual financial
reports required to be filed under applicable laws and regulations
(provided that information as of a later date shall be deemed to
modify information as of an earlier date), and, subject to
permission from such regulatory authorities, Jefferson promptly
will deliver or make available to Hubco accurate and complete
copies of such reports. The Jefferson Disclosure Schedule lists
all examinations of Jefferson conducted by either the Comptroller
or the FDIC since January 1, 1992 and the dates of any responses
thereto submitted by Jefferson.
3.11. Jefferson Information. The information
relating to Jefferson to be contained in the Proxy
Statement/Prospectus (as defined in Section 5.6(a) hereof) to be
delivered to stockholders of Jefferson in connection with the
solicitation of their approval of the Merger, as of the date the
Proxy Statement/Prospectus is mailed to stockholders of Jefferson,
and up to and including the date of the meeting of stockholders to
which such Proxy Statement/Prospectus relates, will not contain any
untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they
were made, not misleading.
3.12. Compliance with Applicable Law. Except as
set forth in the Jefferson Disclosure Schedule, Jefferson holds all
material licenses, franchises, permits and authorizations necessary
for the lawful conduct of its business and since January 1, 1992
has complied with and is not in default in any respect under any
applicable law, statute, order, rule, regulation, policy and/or
guideline of any federal, state or local governmental authority
relating to Jefferson (other than where such default or
noncompliance will not result in a material adverse effect on the
business, operations, assets or financial condition of Jefferson)
and Jefferson has not received notice of violation of, and does not
know of any violations of, any of the above.
3.13. Certain Contracts.
(a) Except for plans referenced in Section 3.9
hereof, contracts described in Section 3.5 hereof, arrangements
described in Section 5.12 hereof and as disclosed in the Jefferson
Disclosure Schedule, (i) Jefferson is not a party to or bound by
any written contract or understanding (whether written or oral)
with respect to the employment of any officers, employees,
directors or consultants, and (ii) the consummation of the
transactions contemplated by this Agreement will not (either alone
or upon the occurrence of any additional acts or events) result in
any payment (whether of severance pay or otherwise) becoming due
from Jefferson to any officer, employee, director or consultant
thereof. The Jefferson Disclosure Schedule sets forth true and
correct copies of any severance or employment agreements with
officers, directors, employees, agents or consultants to which
Jefferson is a party.
(b) Except as disclosed in the Jefferson Disclosure
Schedule and except for loan agreements made and loan commitments
issued in the ordinary course of business, (i) as of the date of
this Agreement, Jefferson is not a party to or bound by any
commitment, agreement or other instrument which is material to the
business, operations, assets or financial condition of Jefferson
(but in no event shall a contract for less than $50,000 a year be
deemed material under this paragraph) (ii) no commitment, agreement
or other instrument to which Jefferson is a party or by which it is
bound limits the freedom of Jefferson to compete in any line of
business or with any person, and (iii) Jefferson is not a party to
any collective bargaining agreement.
(c) Except as disclosed in the Jefferson Disclosure
Schedule, neither Jefferson nor, to the best knowledge of
Jefferson, any other party thereto, is in default in any material
respect under any material lease, contract, mortgage, promissory
note, deed of trust, loan or other commitment (except those under
which Jefferson is or will be the creditor) or arrangement, except
for defaults which individually or in the aggregate would not have
a material adverse effect on the business, operations, assets or
financial condition of Jefferson.
3.14. Properties and Insurance.
(a) Jefferson has good and, as to owned real
property, marketable title to all material assets and properties,
whether real or personal, tangible or intangible, reflected in
Jefferson's statement of condition as of December 31, 1993, or
owned and acquired subsequent thereto (except to the extent that
such assets and properties have been disposed of for fair value in
the ordinary course of business since December 31, 1993), subject
to no encumbrances, liens, mortgages, security interests or
pledges, except (i) those items that secure liabilities that are
reflected in said statement of condition or the notes thereto or
that secure liabilities incurred in the ordinary course of business
after the date of such statement of condition, (ii) statutory liens
for amounts not yet delinquent or which are being contested in good
faith, (iii) such encumbrances, liens, mortgages, security
interests, pledges and title imperfections that are not in the
aggregate material to the business, operations, assets, and
financial condition of Jefferson and (iv) with respect to owned
real property, title imperfections noted in title reports delivered
to Hubco prior to the date hereof. Except as affected by the
transactions contemplated hereby, Jefferson as lessee has the right
under valid and subsisting leases to occupy, use, possess and
control all real property leased by Jefferson in all material
respects as presently occupied, used, possessed and controlled by
Jefferson.
(b) The business operations and all insurable
properties and assets of Jefferson are insured for its benefit
against all risks which, in the reasonable judgment of the
management of Jefferson, should be insured against, in each case
under policies or bonds issued by insurers of recognized
responsibility, in such amounts with such deductibles and against
such risks and losses as are in the opinion of the management of
Jefferson adequate for the business engaged in by Jefferson. As of
the date hereof, Jefferson has not received any notice of
cancellation or notice of a material amendment of any such
insurance policy or bond and, to the best of its knowledge, is not
in default under any such policy or bond, no coverage thereunder is
being disputed and all material claims thereunder have been filed
in a timely fashion.
3.15. Minute Books. The minute books of Jefferson
contain accurate records of all meetings and other corporate action
held of the stockholders and Board of Directors (including
committees of the Board of Directors), except where the failure to
so maintain such records would not have a material adverse effect
on the business, operations, assets or financial condition of
Jefferson.
3.16. Environmental Matters. Except as disclosed
in the Jefferson Disclosure Schedule, Jefferson has not received
any written notice, citation, claim, assessment, proposed
assessment or demand for abatement alleging that Jefferson (either
directly or as a successor-in-interest in connection with the
enforcement of remedies to realize the value of properties serving
as collateral for outstanding loans) is responsible for the
correction or cleanup of any condition resulting from the violation
of any law, ordinance or other governmental regulation regarding
environmental matters which correction or cleanup would be material
to the business, operations, assets or financial condition of
Jefferson. Except as disclosed in the Jefferson Disclosure
Schedule, Jefferson has no actual knowledge that any toxic or
hazardous substances or materials have been emitted, generated,
disposed of or stored on any property currently owned or leased by
Jefferson, or owned or leased by Jefferson in the three years prior
to the date of this Agreement in any manner that violated any
applicable federal, state or local law or regulation governing or
pertaining to such substances and materials, the violation of which
would have a material adverse effect on the business, operations,
assets or financial condition of Jefferson. Except as disclosed in
the Jefferson Disclosure Schedule, all property owned or leased by
Jefferson which was subject to the provisions of the Industrial
Site Recovery Act, N.J.S.A. 13:1K-6, et seq. as amended ("ISRA"),
complied with all applicable provisions of ISRA at the time such
property was sold or transferred by Jefferson.
3.17. Reserves. As of June 30, 1994, the allowance
for possible loan losses in the Jefferson Financial Statements was
adequate based upon all factors required to be considered by
Jefferson at that time in determining the amount of such allowance.
Except as set forth in the Jefferson Disclosure Schedule, the
methodology used to compute the allowance for possible loan losses
complies in all material respects with all applicable policies of
the Comptroller. As of June 30, 1994, the valuation allowance for
OREO properties in the Jefferson Financial Statements was adequate
based upon all factors required to be considered by Jefferson at
that time in determining the amount of such allowance.
3.18. No Parachute Payments. No officer, director,
employee or agent (or former officer, director, employee or agent)
of Jefferson is entitled now, or will or may be entitled to as a
consequence of this Agreement or the Merger, to any payment or
benefit from Jefferson, Hubco or the Bank which if paid or provided
would constitute an "excess parachute payment", as defined in
Section 280G of the Code or regulations promulgated thereunder.
3.19. Agreements with Bank Regulators. Except as
set forth in the Jefferson Disclosure Schedule, Jefferson is not a
party to any commitment letter, board resolution submitted to a
regulatory authority or similar undertaking to, or is subject to
any order or directive by, or is a recipient of any extraordinary
supervisory letter from, any court, governmental authority or other
regulatory or administrative agency or commission, domestic or
foreign ("Governmental Entity") which restricts materially the
conduct of its business, or in any manner relates to its capital
adequacy, its credit or reserve policies or its management, nor has
Jefferson been advised by any Governmental Entity that it is
contemplating issuing or requesting (or is considering the
appropriateness of issuing or requesting) any such order, decree,
agreement, memorandum of understanding, extraordinary supervisory
letter, commitment letter or similar submission. Except as set
forth in the Jefferson Disclosure Schedule, Jefferson is not
required by Section 32 of the Federal Deposit Insurance Act to give
prior notice to a Federal banking agency of the proposed addition
of an individual to its board of directors or the employment of an
individual as a senior executive officer.
3.20. Disclosure. No representation or warranty
contained in Article III of this Agreement contains any untrue
statement of a material fact or omits to state a material fact
necessary to make the statements herein not misleading.
ARTICLE IV - REPRESENTATIONS AND WARRANTIES OF HUBCO
References herein to the "Hubco Disclosure Schedule"
shall mean all of the disclosure schedules required by this Article
IV, dated as of the date hereof and referenced to the specific
sections and subsections of Article IV of this Agreement, which
have been delivered on the date hereof by Hubco to Jefferson.
Hubco hereby represents and warrants to Jefferson as follows:
4.1. Corporate Organization.
(a) Hubco is a corporation duly organized and
validly existing and in good standing under the laws of the State
of New Jersey. Hubco has the corporate power and authority to own
or lease all of its properties and assets and to carry on its
business as it is now being conducted, and is duly licensed or
qualified to do business and is in good standing in each
jurisdiction in which the nature of the business conducted by it or
the character or location of the properties and assets owned or
leased by it makes such licensing or qualification necessary,
except where the failure to be so licensed, qualified or in good
standing would not have a material adverse effect on the business,
operations, assets or financial condition of Hubco or its
subsidiaries (defined below), taken as a whole. Hubco is
registered as a bank holding company under the Bank Holding Company
Act of 1956, as amended.
(b) Each of the Subsidiaries of Hubco are listed in
the Hubco Disclosure Schedule. The term "Subsidiary", when used
with reference to Hubco, means any corporation, partnership, joint
venture or other legal entity in which Hubco directly or
indirectly, owns at least a 50 percent stock or other equity
interest or for which Hubco, directly or indirectly, acts as a
general partner. Each Subsidiary of Hubco is duly organized and
validly existing and in good standing under the laws of the
jurisdiction of its incorporation. The Bank is a state-chartered
commercial bank whose deposits are insured by the FDIC to the
fullest extent permitted by law. Each Subsidiary has the corporate
power and authority to own or lease all of its properties and
assets and to carry on its business as it is now being conducted
and is duly licensed or qualified to do business and is in good
standing in each jurisdiction in which the nature of the business
conducted by it or the character or location of the properties and
assets owned or leased by it makes such licensing or qualification
necessary, except where the failure to be so licensed, qualified or
in good standing would not have a material adverse effect on the
business, operations, assets or financial condition of Hubco and
its subsidiaries, taken as a whole. The Hubco Disclosure Schedule
sets forth true and complete copies of the certificate of
incorporation and by-laws of Hubco as in effect on the date hereof.
4.2. Capitalization. The authorized capital stock
of Hubco consists solely of 13,200,000 shares of Hubco Common Stock
and 3,300,000 shares of preferred stock ("Hubco Authorized
Preferred Stock"). As of September 1, 1994, there were 6,501,536
shares of Hubco Common Stock issued and outstanding, excluding
431,825 shares of treasury stock. Since such date, and from time
to time hereafter, Hubco may sell or repurchase shares of Hubco
Common Stock. As of September 1, 1994, there are 769,410 shares of
Hubco Authorized Preferred Stock outstanding, all of which are
designated as Series A Preferred Stock. Except for shares issuable
under the Hubco Option Plan for Directors (the "Director Options"),
there are no shares of Hubco Common Stock issuable upon the
exercise of outstanding stock options or otherwise. All issued and
outstanding shares of Hubco Common Stock and Hubco Authorized
Preferred Stock, and all issued and outstanding shares of capital
stock of Hubco's Subsidiaries, have been duly authorized and
validly issued, are fully paid, nonassessable and free of
preemptive rights, and are free and clear of all liens,
encumbrances, charges, restrictions or rights of third parties.
All of the outstanding shares of capital stock of Hubco's
Subsidiaries are owned by Hubco free and clear of any liens,
encumbrances, charges, restrictions or rights of third parties.
Except for the Director Options and shares issuable upon the
conversion of Hubco's Series A Preferred Stock, neither Hubco nor
Hubco's Subsidiaries has granted or is bound by any outstanding
subscriptions, options, warrants, calls, commitments or agreements
of any character calling for the transfer, purchase or issuance of
any shares of capital stock of Hubco or Hubco's Subsidiaries or any
securities representing the right to purchase, subscribe or
otherwise receive any shares of such capital stock or any
securities convertible into any such shares, and there are no
agreements or understandings with respect to voting of any such
shares.
4.3. Authority; No Violation.
(a) Hubco and the Bank have full corporate power
and authority to execute and deliver this Agreement and to
consummate the transactions contemplated hereby in accordance with
the terms hereof. The execution and delivery of this Agreement and
the consummation of the transactions contemplated hereby have been
duly and validly approved by the Board of Directors of Hubco and
the Bank in accordance with their respective Certificates of
Incorporation and applicable laws and regulations. No other
corporate proceedings on the part of Hubco or the Bank are
necessary to consummate the transactions so contemplated. This
Agreement has been duly and validly executed and delivered by Hubco
and the Bank and constitutes the valid and binding obligations of
Hubco and the Bank, enforceable against Hubco and the Bank in
accordance with its terms.
(b) Neither the execution or delivery of this
Agreement by Hubco or the Bank, nor the consummation by Hubco or
the Bank of the transactions contemplated hereby in accordance with
the terms hereof or compliance by Hubco or the Bank with any of the
terms or provisions hereof will (i) violate any provision of the
Certificate of Incorporation or By-laws of Hubco or the Bank, (ii)
assuming that the consents and approvals set forth below are duly
obtained, violate any statute, code, ordinance, rule, regulation,
judgment, order, writ, decree or injunction applicable to Hubco or
the Bank or any of their respective properties or assets, or (iii)
violate, conflict with, result in a breach of any provision of,
constitute a default (or an event which, with notice or lapse of
time, or both, would constitute a default) under, result in the
termination of, accelerate the performance required by, or result
in the creation of any lien, security interest, charge or other
encumbrance upon any of the respective properties or assets of
Hubco or the Bank under, any of the terms, conditions or provisions
of any note, bond, mortgage, indenture, deed of trust, license,
lease, agreement or other instrument or obligation to which Hubco
or the Bank is a party, or by which Hubco or the Bank or any of
their properties or assets may be bound or affected, except, with
respect to (ii) and (iii) above, such as individually or in the
aggregate will not have a material adverse effect on the business,
operations, assets or financial condition of Hubco and Hubco's
Subsidiaries, taken as a whole, and which will not prevent or delay
the consummation of the transactions contemplated hereby. Except
for consents and approvals of or filings or registrations with or
notices to the FDIC, the Commissioner, the Department, the
Comptroller, the Board of Governors of the Federal Reserve System,
if required, the SEC, state blue sky authorities or other
applicable governmental authorities, no consents or approvals of or
filings or registrations with or notices to any third party or any
public body or authority are necessary on behalf of Hubco or the
Bank in connection with (x) the execution and delivery by Hubco and
the Bank of this Agreement, and (y) the consummation by Hubco and
the Bank of the Merger and the other transactions contemplated
hereby except such as are listed in the Hubco Disclosure Schedule
or in the aggregate will not (if obtained) have a material adverse
effect on the business, operations, assets or financial condition
of Hubco. To the best of Hubco's knowledge, no fact or condition
exists which Hubco has reason to believe will prevent it from
obtaining the aforementioned consents and approvals.
4.4. Financial Statements.
(a) The Hubco Disclosure Schedule sets forth copies
of the consolidated statements of financial condition of Hubco as
of December 31, 1993 and 1992, the related consolidated statements
of income, changes in stockholders' equity and cash flows for the
periods ended December 31, in each of the three fiscal years 1991
through 1993, in each case accompanied by the audit report of
Arthur Andersen & Co., independent public accountants with respect
to Hubco, and the unaudited consolidated statements of condition of
Hubco as of June 30, 1994 and June 30, 1993 and the related
unaudited consolidated statements of income, cash flows for the six
months then ended as reported in Hubco's Quarterly Report on Form
10-Q, filed with the SEC under the 1934 Act (collectively, the
"Hubco Financial Statements"). The Hubco Financial Statements
(including the related notes) have been prepared in accordance with
GAAP consistently applied during the periods involved (except as
may be indicated therein or in the notes thereto), and fairly
present the consolidated financial position of Hubco as of the
respective dates set forth therein, and the related consolidated
statements of income, changes in stockholders' equity and cash
flows (including the related notes, where applicable) fairly
present the consolidated results of operations, changes in
stockholders' equity and cash flows of Hubco for the respective
fiscal periods set forth therein.
(b) The books and records of Hubco and the Bank are
being maintained in material compliance with applicable legal and
accounting requirements, and reflect only actual transactions.
(c) Except as and to the extent reflected,
disclosed or reserved against in the Hubco Financial Statements
(including the notes thereto), as of June 30, 1994 neither Hubco
nor any of its subsidiaries had any obligation or liability,
whether absolute, accrued, contingent or otherwise, material to the
business, operations, assets or financial condition of Hubco or any
of its Subsidiaries which were required by GAAP (consistently
applied) to be disclosed in Hubco's consolidated statement of
condition as of June 30, 1994 or the notes thereto. Except for the
acquisition of Washington Bancorp, Inc. and any other proposed
acquisitions by Hubco since June 30, 1994, neither Hubco nor any of
its Subsidiaries have incurred any liabilities, except in the
ordinary course of business and consistent with prudent banking
practice.
4.5. Brokerage Fees. Neither Hubco nor any of its
directors or officers has employed any broker or finder or incurred
any liability for any broker's or finder's fees or commissions in
connection with any of the transactions contemplated by this
Agreement.
4.6. Absence of Certain Changes or Events. Except
for the effects of the acquisition of Washington Bancorp Inc. on
July 1, 1994, which effects have been reflected in the Hubco S-4
Registration Statement for the Washington Bancorp Inc. acquisition
and the Form 8-K filed with respect to the acquisition, there has
not been any material adverse change in the business, operations,
assets or financial condition of Hubco and Hubco's Subsidiaries
taken as a whole since June 30, 1994 and to the best of Hubco's
knowledge, no facts or condition exists which Hubco believes will
cause such a material adverse change in the future.
4.7. Legal Proceedings. Except for ordinary
routine litigation incidental to the business of Hubco or its
Subsidiaries, neither Hubco nor any of its Subsidiaries is a party
to any, and there are no pending or, to the best of Hubco's
knowledge, threatened legal, administrative, arbitral or other
proceedings, claims, actions or governmental investigations of any
nature against Hubco or any of its Subsidiaries which, if decided
adversely to Hubco or its Subsidiaries, would have a material
adverse effect on the business, operations, assets or financial
condition of Hubco or its Subsidiaries. Except as disclosed in the
Hubco Disclosure Schedule, neither Hubco nor Hubco's Subsidiaries
is a party to any order, judgment or decree entered in any lawsuit
or proceeding which is material to Hubco or its Subsidiaries.
4.8. Compliance With Applicable Law.
(a) Hubco has filed all reports that it was
required to file with the SEC under the Securities Exchange Act of
1934, as amended (the "1934 Act"), all of which complied in all
material respects with all applicable requirements of the 1934 Act
and the rules and regulations adopted thereunder. As of their
respective dates, each such report and each registration statement,
proxy statement, form or other document filed by Hubco with the
SEC, including without limitation, any financial statements or
schedules included therein, did not contain any untrue statement of
a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements made therein, in
light of the circumstances under which they were made, not
misleading, provided that information as of a later date shall be
deemed to modify information as of an earlier date. Since January
1, 1992, Hubco and the Bank have duly filed all material forms,
reports and documents which they were required to file with each
agency charged with regulating any aspect of their business.
(b) Except as set forth in the Hubco Disclosure
Schedule, each of Hubco and Hubco's Subsidiaries holds all material
licenses, franchises, permits and authorizations necessary for the
lawful conduct of its business, and has complied with and is not in
default in any respect under any applicable law, statute, order,
rule, regulation, policy and/or guideline of any federal, state or
local governmental authority relating to Hubco or Hubco's
Subsidiaries (other than where such default or noncompliance will
not result in a material adverse effect on the business,
operations, assets or financial condition of Hubco and Hubco's
Subsidiaries taken as a whole) and Hubco has not received notice of
violation of, and does not know of any violations of, any of the
above.
4.9. Hubco Information. The information relating
to Hubco and the Bank, this Agreement and the transactions
contemplated hereby in the Registration Statement and Proxy
Statement/Prospectus (as defined in Section 5.6(a) hereof), as of
the date of the mailing of the Proxy Statement/Prospectus, and up
to and including the date of the meeting of stockholders of
Jefferson to which such Proxy Statement/Prospectus relates, will
not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances
under which they are made, not misleading. The Registration
Statement shall comply as to form in all material respects with the
provisions of the Securities Act of 1933, as amended (the "1933
Act"), the 1934 Act and the rules and regulations promulgated
thereunder.
4.10. Funding and Capital Adequacy. At the
Effective Time, Hubco will have sufficient capital to satisfy all
applicable regulatory capital requirements.
4.11. Hubco Common Stock. At the Effective Time,
the Hubco Common Stock issued hereunder will be duly authorized and
validly issued, fully paid, nonassessable, free of preemptive
rights and free and clear of all liens, encumbrances or
restrictions created by or through Hubco, with no personal
liability attaching to the ownership thereof. The Hubco Common
Stock to be issued pursuant to the Merger will be registered under
the 1933 Act and issued in accordance with all applicable state and
federal laws, rules and regulations.
4.12. Taxes and Tax Returns.
(a) Hubco, the Bank and Hubco's other Subsidiaries
have duly filed all Returns required to be filed by them in respect
of any federal, state and local taxes (including withholding taxes,
penalties or other payments required) and have duly paid all such
taxes due and payable, other than taxes or other charges which are
being contested in good faith (and disclosed to Jefferson in
writing). Hubco, the Bank and Hubco's other Subsidiaries have
established on their books and records reserves that are adequate
for the payment of all federal, state and local taxes not yet due
and payable, but are incurred in respect of Hubco or the Bank
through such date. The Hubco Disclosure Schedule identifies the
federal income tax returns of Hubco, the Bank and Hubco's other
Subsidiaries which have been examined by the IRS within the past
six years. No deficiencies were asserted as a result of such
examinations which have not been resolved and paid in full. The
Hubco Disclosure Schedule identifies the applicable state income
tax returns of Hubco, the Bank and Hubco's other Subsidiaries which
have been examined by the applicable authorities. No deficiencies
were asserted as a result of such examinations which have not been
resolved and paid in full. To the best knowledge of Hubco, there
are no audits or other administrative or court proceedings
presently pending nor any other disputes pending with respect to,
or claims asserted for, taxes or assessments upon Hubco, the Bank
or Hubco's other Subsidiaries, nor has Hubco, the Bank or Hubco's
other Subsidiaries given any currently outstanding waivers or
comparable consents regarding the application of the statute of
limitations with respect to any taxes or Returns.
(b) Except as set forth in the Hubco Disclosure
Schedule, neither Hubco nor the Bank nor any other Subsidiary of
Hubco (i) has requested any extension of time within which to file
any Return which Return has not since been filed, (ii) is a party
to any agreement providing for the allocation or sharing of taxes,
(iii) is required to include in income any adjustment pursuant to
Section 481(a) of the Code, by reason of a voluntary change in
accounting method initiated by Hubco or the Bank (nor does Hubco
have any knowledge that the IRS has proposed any such adjustment or
change of accounting method) or (iv) has filed a consent pursuant
to Section 341(f) of the Code or agreed to have Section 341(f)(2)
of the Code apply.
4.13. Employee Benefit Plans.
(a) Hubco and its Subsidiaries maintain or
contribute to certain "employee pension benefit plans" (the "Hubco
Pension Plans"), as such term is defined in Section 3(2)(A) of
ERISA, and "employee welfare benefit plans" (the "Hubco Welfare
Plans"), as such term is defined in Section 3(1) of ERISA. Since
September 2, 1974, neither Hubco nor its Subsidiaries have
contributed to any "Multiemployer Plan", as such term is defined in
Section 3(37) of ERISA.
(b) Each of the Hubco Pension Plans and each of the
Hubco Welfare Plans has been operated in compliance in all material
respects with the provisions of ERISA, the Code, all regulations,
rulings and announcements promulgated or issued thereunder, and all
other applicable governmental laws and regulations. Hubco is not
aware of any fact or circumstance which would disqualify any plan
that could not be retroactively corrected (in accordance with the
procedures of the IRS).
4.14. Contracts. Except as disclosed in the Hubco
Disclosure Schedule, neither Hubco nor the Bank, or to the best
knowledge of Hubco, any party thereto, is in default in any
material respect under any material lease, contract, mortgage,
promissory note, deed of trust, loan or other commitment (except
those under which the Bank is or will be the creditor) or
arrangement, except for defaults which individually or in the
aggregate would not have a material adverse effect on the business,
operations, assets or financial condition of Hubco and the Bank,
taken as a whole.
4.15. Properties and Insurance.
(a) Hubco and the Bank have good and, as to owned
real property, marketable title to all material assets and
properties, whether real or personal, tangible or intangible,
reflected in Hubco's consolidated balance sheet as of December 31,
1993, or owned and acquired subsequent thereto (except to the
extent that such assets and properties have been disposed of for
fair value in the ordinary course of business since December 31,
1993), subject to no encumbrances, liens, mortgages, security
interests or pledges, except (i) those items that secure
liabilities that are reflected in said balance sheet or the notes
thereto or that secure liabilities incurred in the ordinary course
of business after the date of such balance sheet, (ii) statutory
liens for amounts not yet delinquent or which are being contested
in good faith, (iii) such encumbrances, liens, mortgages, security
interests, pledges and title imperfections that are not in the
aggregate material to the business, operations, assets, and
financial condition of Hubco and the Bank taken as a whole and (iv)
with respect to owned real property, title imperfections noted in
title reports. Except as disclosed in the Hubco Disclosure
Schedule, Hubco and the Bank as lessees have the right under valid
and subsisting leases to occupy, use, possess and control all
property leased by Hubco or the Bank in all material respects as
presently occupied, used, possessed and controlled by Hubco and the
Bank.
(b) The business operations and all insurable
properties and assets of Hubco and the Bank are insured for their
benefit against all risks which, in the reasonable judgment of the
management of Hubco, should be insured against, in each case under
policies or bonds issued by insurers of recognized responsibility,
in such amounts with such deductibles and against such risks and
losses as are in the opinion of the management of Hubco adequate
for the business engaged in by Hubco and the Bank. As of the date
hereof, neither Hubco nor the Bank has received any notice of
cancellation or notice of a material amendment of any such
insurance policy or bond or is in default under any such policy or
bond, no coverage thereunder is being disputed and all material
claims thereunder have been filed in a timely fashion.
4.16. Environmental Matters. Except as disclosed
in the Hubco Disclosure Schedule, neither Hubco nor the Bank has
received any written notice, citation, claim, assessment, proposed
assessment or demand for abatement alleging that Hubco, the Bank or
any other Subsidiary of Hubco (either directly or as a successor-
in-interest in connection with the enforcement of remedies to
realize the value of properties serving as collateral for
outstanding loans) is responsible for the correction or cleanup of
any condition resulting from the violation of any law, ordinance or
other governmental regulation regarding environmental matters which
correction or cleanup would be material to the business,
operations, assets or financial condition of Hubco and the Bank
taken as a whole. Except as disclosed in the Hubco Disclosure
Schedule, Hubco has no knowledge that any toxic or hazardous
substances or materials have been emitted, generated, disposed of
or stored on any property currently owned or leased by Hubco or the
Bank or any other Subsidiary in any manner that violates or, after
the lapse of time is reasonably likely to violate, any presently
existing federal, state or local law or regulation governing or
pertaining to such substances and materials, the violation of which
would have a material adverse effect on the business, operations,
assets or financial condition of Hubco and the Bank, taken as a
whole.
4.17. Reserves. As of June 30, 1994, the allowance
for possible loan losses in the Hubco Financial Statements was
adequate based upon all factors required to be considered by Hubco
at that time in determining the amount of such allowance. The
methodology used to compute the allowance for possible loan losses
complies in all material respects with all applicable FDIC and
Department policies. As of June 30, 1994, the valuation allowance
for OREO properties in the Hubco Financial Statements was adequate
based upon all factors required to be considered by Hubco at that
time in determining the amount of such allowance.
4.18. Agreements with Bank Regulators. Neither
Hubco nor the Bank is a party to any agreement or memorandum of
understanding with, or a party to any commitment letter, board
resolution submitted to a regulatory authority or similar
undertaking to, or is subject to any order or directive by, or is
a recipient of any extraordinary supervisory letter from, any
Government Entity which restricts materially the conduct of its
business, or in any manner relates to its capital adequacy, its
credit or reserve policies or its management, except for those the
existence of which has been disclosed in writing to Jefferson by
Hubco prior to the date of this Agreement, nor has Hubco been
advised by any Governmental Entity that it is contemplating issuing
or requesting (or is considering the appropriateness of issuing or
requesting) any such order, decree, agreement, memorandum of
understanding, extraordinary supervisory letter, commitment letter
or similar submission, except as disclosed in writing to Jefferson
by Hubco prior to the date of this Agreement. Neither Hubco nor
the Bank is required by Section 32 of the Federal Deposit Insurance
Act to give prior notice to a Federal banking agency of the
proposed addition of an individual to its board of directors or the
employment of an individual as a senior executive officer, except
as disclosed in writing to Jefferson by Hubco prior to the date of
this Agreement.
4.19. Disclosures. No representation or warranty
contained in Article IV of this Agreement contains any untrue
statement of a material fact or omits to state a material fact
necessary to make the statements herein not misleading.
ARTICLE V - COVENANTS OF THE PARTIES
5.1. Conduct of the Business of Jefferson . During
the period from the date of this Agreement to the Effective Time,
Jefferson shall conduct its business only in the ordinary course
and consistent with prudent banking practice, except for
transactions permitted hereunder or with the prior written consent
of Hubco, which consent will not be unreasonably withheld.
Jefferson also shall use all reasonable efforts to (i) preserve its
business organization intact, (ii) keep available to itself the
present services of its employees and (iii) preserve for itself and
Hubco the goodwill of its customers and others with whom business
relationships exist.
5.2. Negative Covenants.
(a) Jefferson agrees that from the date hereof to
the Effective Time, except as otherwise approved by Hubco in
writing or as permitted or required by this Agreement, it will not:
(i) change any provision of its Articles of
Association or By-laws or any similar governing documents
of Jefferson;
(ii) change the number of shares of its
authorized or issued capital stock or issue or grant any
subscription, option, warrant, call, commitment, right to
purchase or agreement of any character relating to the
authorized or issued capital stock of Jefferson or any
securities convertible into shares of such stock, or
split, combine or reclassify any shares of its capital
stock, or declare, set aside or pay any dividend, or
other distribution (whether in cash, stock or property or
any combination thereof) in respect of its capital stock;
(iii) grant any severance or termination pay
(other than pursuant to policies or contracts of
Jefferson in effect on the date hereof or disclosed to
Hubco pursuant hereto) to, or enter into or amend any
employment or severance agreement with, any of its
directors, officers or employees, except as specified in
the Jefferson Disclosure Schedule; adopt any new employee
benefit plan or arrangement of any type; or award any
increase in compensation or benefits to its directors,
officers or employees except with respect to employee
increases in the ordinary course of business and
consistent with past practices and policies;
(iv) sell or dispose of any substantial
amount of assets or voluntarily incur any significant
liabilities other than in the ordinary course of business
consistent with past practices and policies or in
response to substantial financial demands upon the
business of Jefferson;
(v) except as set forth in the Jefferson
Disclosure Schedule, make any capital expenditures other
than pursuant to binding commitments existing on the date
hereof and other than expenditures necessary to maintain
existing assets in good repair;
(vi) except as set forth in the Jefferson
Disclosure Schedule, file any applications or make any
contract with respect to branching or site location or
relocation;
(vii) agree to acquire in any manner
whatsoever (other than to realize upon collateral for a
defaulted loan) any business or entity;
(viii) make any material change in its
accounting methods or practices, other than changes
required in accordance with generally accepted accounting
principles;
(ix) take any action that would result in any
of its representations and warranties contained in
Article III of this Agreement not being true and correct
in any material respect at the Effective Time or that
would cause any of its conditions to Closing not to be
satisfied; or
(x) agree to do any of the foregoing.
5.3. No Solicitation. Jefferson shall not,
directly or indirectly, encourage or solicit or hold discussions or
negotiations with, or provide any information to, any person,
entity or group (other than Hubco) concerning any merger or sale of
shares of capital stock or sale of substantial assets or
liabilities not in the ordinary course of business, or similar
transactions involving Jefferson (an "Acquisition Transaction").
Notwithstanding the foregoing, Jefferson may enter into discussions
or negotiations or provide information in connection with an
unsolicited possible Acquisition Transaction if the Board of
Directors of Jefferson, after consulting with counsel, determines
in the exercise of its fiduciary responsibilities that such
discussions or negotiations should be commenced or such information
should be furnished. Jefferson will promptly communicate to Hubco
the terms of any proposal, whether written or oral, which it may
receive in respect of any such Acquisition Transaction and the fact
that it is having discussions or negotiations with a third party
about an Acquisition Transaction.
5.4. Current Information. During the period from
the date of this Agreement to the Effective Time, each of Jefferson
and Hubco will cause one or more of its designated representatives
to confer with representatives of the other party on a monthly or
more frequent basis regarding its business, operations, properties,
assets and financial condition and matters relating to the
completion of the transactions contemplated herein. On a monthly
basis, Jefferson agrees to provide Hubco, and Hubco agrees to
provide Jefferson, with internally prepared profit and loss
statements no later than 15 days after the close of each calendar
month. As soon as reasonably available, but in no event more than
45 days after the end of each fiscal quarter (other than the last
fiscal quarter of each fiscal year) ending on or after September
30, 1994, Jefferson will deliver to Hubco and Hubco will deliver to
Jefferson their respective quarterly reports. As soon as
reasonably available, but in no event more than 90 days after the
end of each calendar year, Jefferson will deliver to Hubco and
Hubco will deliver to Jefferson their respective Annual Reports.
5.5. Access to Properties and Records;
Confidentiality.
(a) Jefferson shall permit Hubco and its
representatives, and Hubco and the Bank shall permit Jefferson and
its representatives, reasonable access to their respective
properties, and shall disclose and make available to Hubco and its
representatives, or Jefferson and its representatives, as the case
may be, all books, papers and records relating to its assets, stock
ownership, properties, operations, obligations and liabilities,
including, but not limited to, all books of account (including the
general ledger), tax records, minute books of directors' and
stockholders' meetings, organizational documents, by-laws, material
contracts and agreements, filings with any regulatory authority,
accountants' work papers, litigation files, plans affecting
employees, and any other business activities or prospects in which
Hubco and its representatives, or Jefferson and its
representatives, may have a reasonable interest. Neither party
shall be required to provide access to or to disclose information
where such access or disclosure would violate or prejudice the
rights of any customer, would contravene any law, rule,
regulation, order or judgment or would waive any privilege. The
parties will use their best efforts to obtain waivers of any such
restriction (other than waivers of the attorney-client privilege)
and in any event make appropriate substitute disclosure
arrangements under circumstances in which the restrictions of the
preceding sentence apply. Notwithstanding the foregoing, Jefferson
acknowledges that Hubco may be involved in discussions concerning
other potential acquisitions and Hubco shall not be obligated to
disclose such information to Jefferson except as such information
is disclosed to Hubco's shareholders generally.
(b) All information furnished by the parties hereto
previously in connection with transactions contemplated by this
Agreement or pursuant hereto shall be used solely for the purpose
of evaluating the Merger contemplated hereby and shall be treated
as the sole property of the party delivering the information until
consummation of the Merger contemplated hereby and, if such Merger
shall not occur, each party and each party's advisors shall return
to the other party all documents or other materials containing,
reflecting or referring to such information, will not retain any
copies of such information, shall use its best efforts to keep
confidential all such information, and shall not directly or
indirectly use such information for any competitive or other
commercial purposes. In the event that the Merger contemplated
hereby does not occur, all documents, notes and other writings
prepared by a party hereto or its advisors based on information
furnished by the other party shall be promptly destroyed. The
obligation to keep such information confidential shall continue for
five years from the date the proposed Merger is abandoned but shall
not apply to (i) any information which (A) the party receiving the
information can establish by convincing evidence was already in its
possession prior to the disclosure thereof to it by the other
party; (B) was then generally known to the public; (C) became known
to the public through no fault of the party receiving such
information; or (D) was disclosed to the party receiving such
information by a third party not bound by an obligation of
confidentiality; or (ii) disclosures pursuant to a legal
requirement or in accordance with an order of a court of competent
jurisdiction.
5.6. Regulatory Matters.
(a) For the purposes of holding the Stockholders
Meeting referred to in Section 5.7 hereof and qualifying under
applicable federal and state securities laws the Hubco Common Stock
to be issued to Jefferson stockholders in connection with the
Merger, the parties hereto shall cooperate in the preparation and
filing by Hubco or Jefferson (as applicable) of a Registration
Statement with the SEC which shall include an appropriate proxy
statement and prospectus satisfying all applicable requirements of
applicable state and federal laws, including the 1933 Act, the 1934
Act and applicable state securities laws and the rules and
regulations thereunder, and the rules and regulations of the
Comptroller (such proxy statement and prospectus in the form mailed
by Jefferson to the Jefferson shareholders together with any and
all amendments or supplements thereto, being herein referred to as
the "Proxy Statement/Prospectus" and the various documents to be
filed by Hubco under the 1933 Act with the SEC to register the
Hubco Common Stock for sale, including the Proxy
Statement/Prospectus, are referred to herein as the "Registration
Statement").
(b) Hubco shall furnish Jefferson with such
information concerning Hubco and its Subsidiaries as is necessary
in order to cause the Proxy Statement/Prospectus, insofar as it
relates to such corporations, to comply with Section 5.6(a) hereof.
Hubco agrees promptly to advise Jefferson if at any time prior to
the Jefferson shareholders' meeting referred to in Section 5.7
hereof, any information provided by Hubco in the Proxy
Statement/Prospectus becomes incorrect or incomplete in any
material respect and to provide Jefferson with the information
needed to correct such inaccuracy or omission. Hubco shall furnish
Jefferson with such supplemental information as may be necessary in
order to cause the Proxy Statement/Prospectus, insofar as it
relates to Hubco and its subsidiaries, to comply with Section
5.6(a) after the mailing thereof to Jefferson shareholders.
(c) Jefferson shall furnish Hubco with such
information concerning Jefferson as is necessary in order to cause
the Proxy Statement/Prospectus, insofar as it relates to Jefferson,
to comply with Section 5.6(a) hereof. Jefferson agrees promptly to
advise Hubco if at any time prior to the Jefferson shareholders'
meeting referred to in Section 5.6(a) hereof, any information
provided by Jefferson in the Proxy Statement/Prospectus becomes
incorrect or incomplete in any material respect and to provide
Hubco with the information needed to correct such inaccuracy or
omission. Jefferson shall furnish Hubco with such supplemental
information as may be necessary in order to cause the Proxy
Statement/Prospectus, insofar as it relates to Jefferson, to comply
with Section 5.6(a) after the mailing thereof to Jefferson
shareholders.
(d) Hubco shall as promptly as practicable make
such filings as are necessary in connection with the offering of
the Hubco Common Stock with applicable state securities agencies
and shall use all reasonable efforts to qualify the offering of
such stock under applicable state securities laws at the earliest
practicable date. Jefferson shall promptly furnish Hubco with such
information regarding the Jefferson shareholders as Hubco requires
to enable it to determine what filings are required hereunder.
Jefferson authorizes Hubco to utilize in such filings the
information concerning Jefferson provided to Hubco in connection
with, or contained in, the Proxy Statement/Prospectus. Hubco shall
furnish Jefferson's counsel with copies of all such filings and
keep Jefferson advised of the status thereof. Hubco shall as
promptly as practicable file the Registration Statement containing
the Proxy Statement/Prospectus with the SEC, Jefferson shall as
promptly as practicable file the Proxy Statement/Prospectus with
the Comptroller, and each of Hubco and Jefferson shall promptly
notify the other of all communications, oral or written, with the
SEC and the Comptroller concerning the Registration Statement and
the Proxy Statement/Prospectus.
(e) Hubco shall cause the Hubco Common Stock
issuable pursuant to the Merger to be listed on the National
Association of Securities Dealers Automated Quotation ("NASDAQ")
System at the Effective Time.
(f) The parties hereto will cooperate with each
other and use their reasonable efforts to prepare all necessary
documentation, to effect all necessary filings and to obtain all
necessary permits, consents, approvals and authorizations of all
third parties and governmental bodies necessary to consummate the
transactions contemplated by this Agreement as soon as possible,
including, without limitation, those required by the Comptroller,
the FDIC, the Commissioner, the Department and the DEPE. The
parties shall each have the right to review in advance all filings
with, including all information relating to the other, as the case
may be, and any of their respective Subsidiaries, if any, which
appears in any filing made with, or written material submitted to,
any third party or governmental body in connection with the
transactions contemplated by this Agreement.
(g) Each of the parties will promptly furnish each
other with copies of written communications received by them or any
of their respective Subsidiaries, if any, from, or delivered by any
of the foregoing to, any governmental body in respect of the
transactions contemplated hereby with respect to the Merger.
(h) Jefferson acknowledges that Hubco is in or may
be in the process of acquiring other banks and financial
institutions and that in connection with such acquisitions,
information concerning Jefferson may be required to be included in
the registration statements, if any, for the sale of securities of
Hubco or in SEC reports in connection with such acquisitions.
Jefferson agrees to provide Hubco with any information,
certificates, documents or other materials about Jefferson as are
reasonably necessary to be included in such other SEC reports or
registration statements, including registration statements which
may be filed by Hubco prior to the Effective Time. Jefferson shall
use its reasonable efforts to cause its attorneys and accountants
to provide Hubco and any underwriters for Hubco with any consents,
comfort letters, opinion letters, reports or information which are
necessary to complete the registration statements and applications
or any such acquisition or issuance of securities. Hubco shall
reimburse Jefferson for expenses thus incurred by Jefferson should
this transaction be terminated for any reason other than Section
7.1(i). Hubco shall not file with the SEC any registration
statement or amendment thereto or supplement thereof containing
information regarding Jefferson unless Jefferson shall have
consented to such filing. Jefferson shall not unreasonably delay
or withhold any such consent.
(i) The parties shall use all reasonable efforts to
cause the filings with the SEC of the Proxy Statement/Prospectus,
and all regulatory filings with the FDIC, the Commissioner and the
Comptroller, to be made by December 1, 1994.
5.7. Approval of Stockholders. Jefferson will (a)
take all steps necessary duly to call, give notice of, convene and
hold a meeting of the stockholders of Jefferson (the "Stockholders
Meeting") for the purpose of securing the approval of stockholders
of this Agreement, (b) subject to the qualification set forth in
Section 5.3 hereof and the right not to make a recommendation or to
withdraw a recommendation if its investment banker withdraws its
fairness opinion prior to the Stockholders' Meeting, recommend to
the stockholders of Jefferson the approval of this Agreement and
the transactions contemplated hereby and use its reasonable efforts
to obtain, as promptly as practicable, such approvals, and (c)
cooperate and consult with Hubco with respect to each of the
foregoing matters.
5.8. Further Assurances. Subject to the terms and
conditions herein provided, each of the parties hereto agrees to
use all reasonable efforts to take, or cause to be taken, all
actions and to do, or cause to be done, all things necessary,
proper or advisable under applicable laws and regulations to
satisfy the conditions to Closing and to consummate and make
effective the transactions contemplated by this Agreement,
including, without limitation, using reasonable efforts to lift or
rescind any injunction or restraining order or other order
adversely affecting the ability of the parties to consummate the
transactions contemplated by this Agreement and using its
reasonable efforts to prevent the breach of any representation,
warranty, covenant or agreement of such party contained or referred
to in this Agreement and to promptly remedy the same. In case at
any time after the Effective Time any further action is necessary
or desirable to carry out the purposes of this Agreement, the
proper officers and directors of each party to this Agreement shall
take all such necessary action. Nothing in this section shall be
construed to require any party to participate in any threatened or
actual legal, administrative or other proceedings (other than
proceedings, actions or investigations to which it is a party or
subject or threatened to be made a party or subject) in connection
with consummation of the transactions contemplated by this
Agreement unless such party shall consent in advance and in writing
to such participation and the other party agrees to reimburse and
indemnify such party for and against any and all costs and damages
related thereto.
Hubco agrees that from the date hereof to the
Effective Time, except as otherwise approved by Jefferson in
writing or as permitted or required by this Agreement, it will not,
nor will it permit the Bank to take any action that would result in
any of its representations and warranties contained in Article IV
of this Agreement not being true and correct in any material
respect at the Effective Time or that would cause any of its
conditions to Closing not to be satisfied.
5.9. Public Announcements. Hubco and Jefferson
shall cooperate with each other in the development and distribution
of all news releases and other public filings and disclosures with
respect to this Agreement or the Merger transaction contemplated
hereby, and Hubco and Jefferson agree that unless approved mutually
by them in advance, they will not issue any press release or
written statement for general circulation relating primarily to the
transaction contemplated hereby, except as may be otherwise
required by law or regulation in the opinion of counsel.
5.10. Failure to Fulfill Conditions. In the event
that Hubco or Jefferson determines that a material condition to its
obligation to consummate the transactions contemplated hereby
cannot be fulfilled on or prior to June 30, 1995 and that it will
not waive that condition, it will promptly notify the other party.
Except for any acquisition or merger discussions Hubco may enter
into with other parties, Jefferson and Hubco will promptly inform
the other of any facts applicable to Jefferson or Hubco,
respectively, or their respective directors or officers, that would
be likely to prevent or materially delay approval of the Merger by
any governmental authority or which would otherwise prevent or
materially delay completion of the Merger.
5.11. Indemnification and Insurance.
(a) For a period of six years after the Effective
Time, Hubco shall indemnify, defend and hold harmless each person
who is now, or has been at any time prior to the date hereof or who
becomes prior to the Effective Time, a director, officer, employee
or agent of Jefferson or any Subsidiary of Jefferson or serves or
has served at the request of Jefferson in any capacity with any
other person (collectively, the "Indemnitees") against any and all
claims, damages, liabilities, losses, costs, charges, expenses
(including, without limitation, reasonable costs of investigation,
and the reasonable fees and disbursements of legal counsel and
other advisers and experts as incurred), judgments, fines,
penalties and amounts paid in settlement, asserted against,
incurred by or imposed upon any Indemnitee, (i) in connection with,
arising out of or relating to any threatened, pending or completed
claim, action, suit or proceeding (whether civil, criminal,
administrative or investigative), including, without limitation,
any and all claims, actions, suits, proceedings or investigations
by or on behalf of or in the right of or against Jefferson, or by
any present or former shareholder of Jefferson (collectively,
"Claims"), including, without limitation, any Claim which is based
upon, arises out of or in any way relates to the Merger, the proxy
statement/prospectus mailed to Jefferson's stockholders to vote on
the Merger, this Agreement, any of the transactions contemplated by
this Agreement, the Indemnitee's service as a member of Jefferson's
Board of Directors or any committee of Jefferson's Board of
Directors, the events leading up to the execution of this
Agreement, any statement, recommendation or solicitation made in
connection therewith or related thereto and any breach of any duty
in connection with any of the foregoing, and (ii) in connection
with, arising out of or relating to the enforcement of the
obligations of Hubco set forth in this Section 5.11, in each case
to the fullest extent permitted under any applicable law,
Jefferson's Articles of Association or its By-Laws (and Hubco shall
also advance expenses as incurred to the fullest extent permitted
under any thereof).
(b) From and after the Effective Time, Hubco shall
assume and honor any obligation of Jefferson immediately prior to
the Effective Time with respect to the indemnification of the
Indemnitees arising out of Jefferson's Articles of Association or
By-Laws as if such obligations were pursuant to a contract or
arrangement between Hubco and such Indemnitees.
(c) In the event Hubco or any of its successors or
assigns (i) reorganizes or consolidates with or merges into or
enters into another business combination transaction with any other
person or entity and is not the resulting, continuing or surviving
corporation or entity of such consolidation, merger or transaction,
or (ii) liquidates, dissolves or transfers all or substantially all
of its properties and assets to any person or entity, then, and in
each such case, proper provision shall be made so that the
successors and assigns of Hubco assume the obligations set forth in
this Section 5.11.
(d) Hubco shall have Jefferson's officers and
directors covered under either Jefferson's existing officers' and
directors' liability insurance policy or a rider to Hubco's then
current officers' and directors' liability insurance ("D&O
Insurance") policy for periods of at least six years after the
Effective Time. However, Hubco only shall be required to insure
such persons upon terms and for coverages substantially similar to
Jefferson's existing D&O insurance.
(e) Any Indemnitee wishing to claim indemnification
under Section 5.11, upon learning of any such claim, action, suit
or proceeding, shall promptly notify Hubco thereof, but the failure
to so notify shall not relieve Hubco of any liability it may have
to such Indemnitee if such failure does not materially prejudice
Hubco. In the event of any such claim, action, suit or proceeding
(whether arising before or after the Effective Time) as to which
indemnification under this Section 5.11 is applicable, (a) Hubco
shall have the right to assume the defense thereof and Hubco shall
not be liable to such Indemnitees for any legal expenses of other
counsel or any other expenses subsequently incurred by such
Indemnitees in connection with the defense thereof, except that if
Hubco elects not to assume such defense or counsel for the
Indemnitees advises that there are issues which raise conflicts of
interest between Hubco and the Indemnitees, the Indemnitees may
retain counsel satisfactory to them, and Hubco shall pay the
reasonable fees and expenses of such counsel for the Indemnitees as
statements therefor are received; provided however, that Hubco
shall be obligated pursuant to this paragraph (e) to pay for only
one firm of counsel for all Indemnitees in any jurisdiction with
respect to a matter unless the use of one counsel for such
Indemnitees would present such counsel with a conflict of interest
that is not waived and (b) the Indemnitees will cooperate in the
defense of any such matter. Hubco shall not be liable for
settlement of any claim, action or proceeding hereunder unless such
settlement is effected with its prior written consent; provided
however, that Hubco shall not have any obligation hereunder to any
Indemnitee when and if a court of competent jurisdiction shall
ultimately determine, and such determination shall have become
final and nonappealable, that the indemnification of such
Indemnitee in the manner contemplated hereby is prohibited by
applicable law or public policy.
5.12. Retention of Employees and Officers of
Jefferson.
(a) Following consummation of the Merger, to the
extent practicable, Hubco will endeavor to cause the Bank to retain
and the Bank will, to the extent practical, retain all of
Jefferson's existing employees at similar compensation levels.
(b) Following consummation of the Merger, to the
extent practicable, Hubco will endeavor to cause the Bank to retain
and the Bank will, to the extent practical, retain Jefferson's
current officers in similar positions with the Bank.
(c) To the extent any officer or employee of
Jefferson is terminated following consummation of the Merger, such
officer or employee shall be covered by Hubco's severance policy as
described in the Hubco Disclosure Schedule with respect to
retrenchment or reduction in force and be given credit under such
policy for their years of service with Jefferson.
(d) Following consummation of the Merger, Hubco
intends to make available to all employees and officers of
Jefferson employed by the Bank coverage under the benefit plans
generally available to Hubco's employees and officers (including
pension and health and hospitalization) on the terms and conditions
available to the Bank's employees and officers. Jefferson
employees who come under Hubco's or the Bank's medical, vacation,
sick leave and disability plans will be given credit under such
plans for prior service with Jefferson and Jefferson's employees
shall be granted credit for prior service with Jefferson toward
eligibility and vesting under Hubco's pension and 401(k) plans.
(e) Prior to the Closing, Hubco shall offer an
employment agreement and a bonus agreement to Joseph Greco and
bonus agreements to the chief financial officer and senior
operating officer of Jefferson in the form previously provided to
Jefferson.
5.13. Disclosure Supplements. From time to time
prior to the Effective Time, each party hereto will promptly
supplement or amend (by written notice to the other) its respective
Disclosure Schedule delivered pursuant hereto with respect to any
matter hereafter arising which, if existing, occurring or known at
the date of this Agreement, would have been required to be set
forth or described in such Disclosure Schedule or which is
necessary to correct any information in such Disclosure Schedule
which has been rendered materially inaccurate thereby. For the
purpose of determining satisfaction of the conditions set forth in
Article VI, no supplement or amendment to such Disclosure Schedule
shall correct or cure any warranty which was untrue when made, but
shall enable the disclosure of subsequent facts or events to
maintain the truthfulness of any warranty.
5.14. Transaction Expenses of Jefferson. Jefferson
shall advise Hubco monthly of all out-of-pocket expenses which
Jefferson has incurred in connection with this transaction.
Jefferson shall mutually agree with Hubco about printing
arrangements for the Proxy Statement/Prospectus before entering
into any binding contract for such expenses.
5.15. Compliance with Antitrust Laws. Each of
Hubco and Jefferson shall use its best efforts to resolve such
objections, if any, which may be asserted with respect to the
Merger under antitrust laws, including, without limitation, the
Hart-Scott-Rodino Act. In the event a suit is threatened or
instituted challenging the Merger as violative of antitrust laws,
each of Hubco and Jefferson shall use its best efforts to avoid the
filing of, resist or resolve such suit. Hubco and Jefferson shall
use their best efforts to take such action as may be required: (a)
by the Antitrust Division of the Department of Justice or the
Federal Trade Commission in order to resolve such objections as
either of them may have to the Merger under antitrust laws, or (b)
by any federal or state court of the United States, in any suit
brought by a private party or governmental entity challenging the
Merger as violative of antitrust laws, in order to avoid the entry
of, or to effect the dissolution of, any injunction, temporary
restraining order, or other order which has the effect of
preventing the consummation of the Merger. Best efforts shall
include, but not be limited to, the proffer by Hubco of its
willingness to accept an order agreeing to the divestiture, or the
holding separate, of any assets of Hubco or Jefferson, except to
the extent that any such divestitures or holding separate
arrangement would have a material adverse effect on Hubco. The
entry by a court, in any suit brought by a private party or
governmental entity challenging the Merger as violative of
antitrust laws, of an order or decree permitting the Merger, but
requiring that any of the businesses, product lines or assets of
Hubco or Jefferson be divested or held separate thereafter shall
not be deemed a failure to satisfy the conditions specified in
Section 6.1 hereof except to the extent that any divestitures or
holding separate arrangement would have a material adverse effect
on Hubco and Hubco shall not have voluntarily consented to such
divestitures or holding separate arrangements. For the purposes of
this Section 5.15, the divestiture or the holding separate of a
branch of the Bank or Jefferson with less than $20 million in
assets shall not be considered to have a material adverse effect on
Hubco.
5.16. Comfort Letters. Hubco shall cause Arthur
Andersen LLP, its independent public accountants, to deliver to
Jefferson, and Jefferson shall cause Arthur Andersen LLP, its
independent public accountants, to deliver to Hubco and to its
officers and directors who sign the Registration Statement for this
transaction, a short-form "comfort letter" or "agreed upon
procedures" letter, dated the date of the mailing of the Proxy
Statement/Prospectus for the Stockholders Meeting of Jefferson, in
the form customarily issued by such accountants at such time in
transactions of this type.
5.17. Affiliates. Promptly, but in any event within
two weeks, after the execution and delivery of this Agreement,
Jefferson shall deliver to Hubco (a) a letter identifying all
persons who, to the knowledge of Jefferson, may be deemed to be
affiliates of Jefferson under Rule 145 of the 1933 Act and the
pooling-of-interests accounting rules, including, without
limitation, all directors and executive officers of Jefferson and
(b) copies of letter agreements, each substantially in the form of
Exhibit 5.17, executed by each such person so identified as an
affiliate of Jefferson agreeing to comply with Rule 145 and to
refrain from transferring shares as required by the pooling-of-
interests accounting rules. Hubco hereby agrees to publish, or
file a Form 8-K, Form 10-K or Form 10-Q containing financial
results covering at least 30 days of combined operations of Hubco
and Jefferson as soon as practicable but in no event later than 20
days after the last day of the first full calendar month following
the Effective Time.
5.18. Pooling in Tax-Free Reorganization Treatment.
Prior to the date hereof, Hubco has not taken any action or failed
to take any action which would disqualify the Merger for pooling of
interests accounting treatment, and before the Effective Time,
neither Hubco nor Jefferson shall intentionally take, fail to take,
or cause to be taken or not taken any action within its control,
which would disqualify the Merger as a "pooling-of-interests"
unless Hubco agrees to waive the condition contained in Section
6.2(c) for accounting purposes or as a "reorganization" within the
mean of Section 368(a) of the Code.
ARTICLE VI - CLOSING CONDITIONS
6.1. Conditions of Each Party's Obligations Under
this Agreement. The respective obligations of each party under
this Agreement to consummate the Merger shall be subject to the
satisfaction, or, where permissible under applicable law, waiver at
or prior to the Effective Time of the following conditions:
(a) Approval of Jefferson Stockholders; SEC
Registration. This Agreement and the transactions contemplated
hereby shall have been approved by the requisite vote of the
stockholders of Jefferson. The Jefferson proxy statement shall
have been cleared for distribution by the Comptroller. The Hubco
Registration Statement shall have been declared effective by the
SEC and shall not be subject to a stop order or any threatened stop
order, and the issuance of the Hubco Common Stock shall have been
qualified in every state where such qualification is required under
the applicable state securities laws.
(b) Regulatory Filings. All necessary regulatory
or governmental approvals and consents (including without
limitation any required approval of the Comptroller, the
Commissioner, the FDIC and the DEPE) required to consummate the
transactions contemplated hereby shall have been obtained without
any term or condition which would materially impair the value of
Jefferson to Hubco. All conditions required to be satisfied prior
to the Effective Time by the terms of such approvals and consents
shall have been satisfied; and all statutory waiting periods in
respect thereof (including the Hart-Scott-Rodino waiting period)
shall have expired.
(c) Suits and Proceedings. No order, judgment or
decree shall be outstanding against a party hereto or a third party
that would have the effect of preventing completion of the Merger;
no suit, action or other proceeding shall be pending or threatened
by any governmental body in which it is sought to restrain or
prohibit the Merger; and no suit, action or other proceeding shall
be pending before any court or governmental agency in which it is
sought to restrain or prohibit the Merger or obtain other
substantial monetary or other relief against one or more parties
hereto in connection with this Agreement and which Hubco or
Jefferson determines in good faith, based upon the advice of their
respective counsel, makes it inadvisable to proceed with the Merger
because any such suit, action or proceeding has a significant
potential to be resolved in such a way as to deprive the party
electing not to proceed of any of the material benefits to it of
the Merger.
(d) Tax Opinion. Hubco and Jefferson shall each
have received an opinion, dated as of the Effective Time, of
Pitney, Hardin, Kipp & Szuch, reasonably satisfactory in form and
substance to Jefferson and its counsel Lowenstein, Sandler, Kohl,
Fisher & Boylan and to Hubco, based upon representation letters
reasonably required by Pitney, Hardin, Kipp & Szuch, dated on or
about the date of such opinion, and such other facts and
representations as counsel may reasonably deem relevant, to the
effect that
(i) the Merger will be treated for federal
income tax purposes as a reorganization
qualifying under the provisions of Sections
368(a)(1)(A) and 368(a)(2)(D) of the Code;
(ii) no gain or loss will be recognized by
Jefferson; (iii) no gain or loss shall be
recognized upon the exchange of Jefferson
Common Stock solely for Hubco Common Stock;
(iv) the basis of any Hubco Common Stock
received in exchange for Jefferson Common
Stock shall equal the basis of the recipient's
Jefferson Common Stock surrendered on the
exchange, reduced by the amount of cash
received, if any, on the exchange, and
increased by the amount of the gain
recognized, if any, on the exchange (whether
characterized as dividend or capital gain
income); and (v) the holding period for any
Hubco Common Stock received in exchange for
Jefferson Common Stock will include the period
during which the Jefferson Common Stock
surrendered on the exchange was held, provided
such stock was held as a capital asset on the
date of the exchange.
6.2. Conditions to the Obligations of Hubco Under
this Agreement. The obligations of Hubco under this Agreement
shall be further subject to the satisfaction or waiver, at or prior
to the Effective Time, of the following conditions:
(a) Representations and Warranties; Performance of
Obligations of Jefferson. Except for those representations which
are made as of a particular date, the representations and
warranties of Jefferson contained in this Agreement shall be true
and correct in all material respects on the date of the Closing
("Closing Date") as though made on and as of the Closing Date.
Jefferson shall have performed in all material respects the
agreements, covenants and obligations to be performed by it prior
to the Closing Date. With respect to any representation or
warranty which as of the Closing Date has required a supplement or
amendment to the Jefferson Disclosure Schedule to render such
representation or warranty true and correct in all material
respects as of the Closing Date, the representation and warranty
shall be deemed true and correct as of the Closing Date only if (i)
the information contained in the supplement or amendment to the
Jefferson Disclosure Schedule related to events occurring following
the execution of this Agreement and (ii) the facts disclosed in
such supplement or amendment would not either alone, or together
with any other supplements or amendments to the Jefferson
Disclosure Schedule, materially adversely affect the representation
as to which the supplement or amendment relates.
(b) Opinion of Counsel to Jefferson. Hubco shall
have received an opinion of counsel to Jefferson, dated the Closing
Date, in form and substance reasonably satisfactory to Hubco,
covering the matters set forth on Exhibit 6.2 hereto.
(c) Pooling of Interests. Hubco shall have
received assurances from its accountants, Arthur Andersen LLP, to
the effect that the Merger shall be qualified to be treated by
Hubco as a pooling-of-interests for accounting purposes.
(d) Certificates. Jefferson shall have furnished
Hubco with such certificates of its officers or other documents to
evidence fulfillment of the conditions set forth in this Section
6.2 as Hubco may reasonably request.
6.3. Conditions to the Obligations of Jefferson
Under this Agreement. The obligations of Jefferson under this
Agreement shall be further subject to the satisfaction or waiver,
at or prior to the Effective Time, of the following conditions:
(a) Representations and Warranties; Performance of
Obligations of Hubco. Except for those representations which are
made as of a particular date, the representations and warranties of
Hubco contained in this Agreement shall be true and correct in all
material respects on the Closing Date as though made on and as of
the Closing Date. Hubco and the Bank shall have performed in all
material respects, the agreements, covenants and obligations to be
performed by it prior to the Closing Date. With respect to any
representation or warranty which as of the Closing Date has
required a supplement or amendment to the Hubco Disclosure Schedule
to render such representation or warranty true and correct in all
material respects as of the Closing Date, the representation and
warranty shall be deemed true and correct as of the Closing Date
only if (i) the information contained in the supplement or
amendment to the Hubco Disclosure Schedule related to events
occurring following the execution of this Agreement and (ii) the
facts disclosed in such supplement or amendment would not either
alone, or together with any other supplements or amendments to the
Hubco Disclosure Schedule, materially adversely affect the
representation as to which the supplement or amendment relates.
(b) Opinion of Counsel to Hubco. Jefferson shall
have received an opinion of counsel to Hubco, dated the Closing
Date, in form and substance reasonably satisfactory to Jefferson ,
covering the matters set forth on Exhibit 6.3 hereto.
(c) Fairness Opinion. Jefferson shall have
received an opinion from Capital Consultants of Princeton, Inc.,
dated as of the date the Proxy Statement/Prospectus is mailed to
Jefferson's stockholders, to the effect that, in its opinion, the
consideration to be paid to stockholders of Jefferson hereunder is
fair to such stockholders from a financial point of view ("Fairness
Opinion").
(d) No Acquisition by Hubco Causing 15% Dilution.
Hubco shall have obtained the written consent of Jefferson if,
between the date hereof and the Effective Time, Hubco or the Bank
(i) enters into one or more definitive acquisition agreements to
acquire other banks, thrifts or other financial institutions (or
the assets and/or liabilities of such institutions) and (ii) the
cumulative impact on Hubco's earnings per share from such
additional acquisitions reasonably is projected to dilute by
fifteen percent (15%) or more the estimates prepared by analysts of
earnings per share of Hubco for the year following the consummation
of such acquisition. If the parties cannot agree concerning this
matter, they agree to submit any dispute to a mutually satisfactory
investment banker whose opinion shall be final and binding.
(e) Certificates. Hubco shall have furnished
Jefferson with such certificates of its officers or others and
such other documents to evidence fulfillment of the conditions set
forth in this Section 6.3 as Jefferson may reasonably request.
ARTICLE VII - TERMINATION, AMENDMENT AND WAIVER
7.1. Termination. This Agreement may be terminated
prior to the Effective Time, whether before or after approval of
this Agreement by the stockholders of Jefferson:
(a) by mutual written consent of the parties
hereto;
(b) (i) by Jefferson or Hubco if the Effective
Time shall not have occurred on or prior to June 30, 1994 unless
the failure of such occurrence shall be due to the failure of the
party seeking to terminate this Agreement to perform or observe its
agreements set forth herein to be performed or observed by such
party at or before the Effective Time, or (ii) by Hubco or
Jefferson if a vote of the stockholders of Jefferson is taken and
such stockholders fail to approve this Agreement at the meeting (or
any adjournment thereof) held for such purpose;
(c) by Hubco or Jefferson upon written notice to
the other if any application for regulatory or governmental
approval necessary to consummate the Merger and the other
transactions contemplated hereby shall have been denied or
withdrawn at the request or recommendation of the applicable
regulatory agency or governmental authority or by Hubco upon
written notice to Jefferson if any such application is approved
with conditions which materially impair the value of Jefferson to
Hubco;
(d) by Hubco if (i) there shall have occurred a
material adverse change in the business, operations, assets, or
financial condition of Jefferson from that disclosed by Jefferson
in Jefferson's Call Report for June 30, 1994 and Jefferson's Annual
Report to Shareholders for the year ended December 31, 1993; or
(ii) there was a material breach in any representation, warranty,
covenant, agreement or obligation of Jefferson hereunder and such
breach shall not have been remedied within 30 days after receipt by
Jefferson of notice in writing from Hubco to Jefferson specifying
the nature of such breach and requesting that it be remedied;
(e) by Jefferson, if (i) there shall have occurred
a material adverse change in the business, operations, assets or
financial condition of Hubco and its Subsidiaries taken as a whole
from that disclosed by Hubco in Hubco's Quarterly Report on Form
10-Q for the six months ended June 30, 1994 and Hubco's Annual
Report on Form 10-K for the fiscal year ended December 31, 1993,
except for the effects of the acquisition of Washington Bancorp
Inc. on July 1, 1994, the effects of which have been reflected in
the Hubco S-4 Registration Statement for the Washington Bancorp
Inc. acquisition and the Form 8-K filed with respect to the
acquisition; or (ii) there was a material breach in any
representation, warranty, covenant, agreement or obligation of
Hubco hereunder and such breach shall not have been remedied within
30 days after receipt by Hubco of notice in writing from Jefferson
specifying the nature of such breach and requesting that it be
remedied;
(f) by Hubco if the conditions set forth in Section
6.2 are not satisfied;
(g) by Jefferson if the conditions set forth in
Section 6.3 are not satisfied;
(h) by Hubco upon written notice to Jefferson
prior to the Effective Time if the Median Pre-Closing Price is less
than the Lower Adjustment Price; and
(i) by Jefferson, if Jefferson's Board of
Directors shall have approved an Acquisition Transaction after
determining, upon advice of counsel, that such approval was
necessary in the exercise of its fiduciary obligations under
applicable laws.
7.2. Effect of Termination. In the event of the
termination and abandonment of this Agreement by either Hubco or
Jefferson pursuant to Section 7.1, this Agreement (other than
Section 5.5(b), the third from the last sentence of Section 5.6(h),
this Section 7.2 and Section 8.1) shall forthwith become void and
have no effect, without any liability on the part of any party or
its officers, directors or stockholders. Nothing contained herein,
however, shall relieve any party from any liability for any breach
of this Agreement.
7.3. Amendment. This Agreement may be amended by
action taken by the parties hereto at any time before or after
adoption of this Agreement by the stockholders of Jefferson but,
after any such adoption, no amendment shall be made which reduces
the amount or changes the form of the consideration to be delivered
to the stockholders of Jefferson without the approval of such
stockholders. This Agreement may not be amended except by an
instrument in writing signed on behalf of all the parties hereto.
7.4. Extension; Waiver. The parties may, at any
time prior to the Effective Time of the Merger, (i) extend the time
for the performance of any of the obligations or other acts of the
other parties hereto; (ii) waive any inaccuracies in the
representations and warranties contained herein or in any document
delivered pursuant thereto; or (iii) waive compliance with any of
the agreements or conditions contained herein. Any agreement on
the part of any party to any such extension or waiver shall be
valid only if set forth in an instrument in writing signed on
behalf of such party against which the waiver is sought to be
enforced.
ARTICLE VIII - MISCELLANEOUS
8.1. Expenses.
(a) Subject to Section 5.6(h) and Section 8.1(c)
hereof, all costs and expenses incurred in connection with this
Agreement and the transactions contemplated hereby (including
legal, accounting and investment banking fees and expenses) shall
be borne by the party incurring such costs and expenses.
(b) Notwithstanding any provision in this Agreement
to the contrary, in the event that either of the parties shall
willfully default in its obligations hereunder, the non-defaulting
party may pursue any remedy available at law or in equity to
enforce its rights and shall be paid by the willfully defaulting
party for all damages, costs and expenses, including without
limitation legal, accounting, investment banking and printing
expenses, incurred or suffered by the non-defaulting party in
connection herewith or in the enforcement of its rights hereunder
if such non-defaulting party prevails.
(c) If
(i) this Agreement is terminated by Jefferson
pursuant to Section 7.1(i), or by Hubco pursuant to
Section 7.1(d)(ii) because of a breach by Jefferson of
any covenant, or by Hubco or Jefferson pursuant to
Section 7.1(b)(ii) because of an action taken by
Jefferson or Jefferson's Board of Directors, and
(ii) after the execution of this Agreement and
prior to the date of termination of this Agreement
Jefferson is informed orally or in writing of a proposal
to effect an Acquisition Transaction which proposal is
not fully withdrawn prior to the date of termination and
which proposal is made by a company or person other than
Hubco and its affiliates; and
(iii) before or within 12 months after the
date of the termination of this Agreement (a) Jefferson
shall have entered into an agreement to engage in an
Acquisition Transaction with any person other than Hubco,
or (b) the Board of Directors of Jefferson shall have
approved an Acquisition Transaction or shall have
recommended that the shareholders of Jefferson approve or
accept any Acquisition Transaction, in each case, other
than as contemplated by this Agreement, and
(iv) an Acquisition Transaction between
Jefferson and another person shall have closed
("Acquisition Transaction Closing") within 24 months
after the termination of this Agreement;
then Jefferson or its successor in interest shall pay to Hubco
immediately after the Acquisition Transaction Closing, a
termination fee (the "Termination Fee") equal to $250,000, plus the
legal fees and expenses of Hubco incurred in enforcing its right to
the Termination Fee.
8.2. Survival. Except for the provisions of
Article II, Section 5.8, Section 5.11, and Section 5.17 hereof, the
respective representations, warranties, covenants and agreements of
the parties to this Agreement shall not survive the Effective Time,
but shall terminate as of the Effective Time.
8.3. Notices. All notices or other communications
which are required or permitted hereunder shall be in writing and
sufficient if delivered personally or sent by registered or
certified mail, postage prepaid, as follows:
(a) If to Hubco, to:
HUBCO, Inc.
3100 Bergenline Avenue
Union City, New Jersey 07087
Attn.: Kenneth T. Neilson, President
Copy to:
Pitney, Hardin, Kipp & Szuch
200 Campus Drive
Florham Park, New Jersey 07932-0950
Attn.: Ronald H. Janis, Esq.
(b) If to Jefferson, to:
Jefferson National Bank
155 Jefferson Street
Passaic, New Jersey 07055
Attn.: Raymond L. Sisco, Chairman
Copy to:
Peter H. Ehrenberg, Esq.
Lowenstein, Sandler, Kohl, Fisher & Boylan
65 Livingston Avenue
Roseland, New Jersey 07068
or such other addresses as shall be furnished in writing by any
party, and any such notice or communications shall be deemed to
have been given as of the date so mailed.
8.4. Parties in Interest. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto
and their respective successors and assigns. Nothing in this
Agreement is intended to confer, expressly or by implication, upon
any other person any rights or remedies under or by reason of this
Agreement, except for the Indemnitees covered by Section 5.11
hereof and the persons signing letter agreements pursuant to
Section 5.17 hereof who shall be entitled to the benefits of such
Section 5.17.
8.5. Entire Agreement. This Agreement, which
includes the Disclosure Schedules hereto and the other documents,
agreements and instruments executed and delivered pursuant to or in
connection with this Agreement, contains the entire Agreement
between the parties hereto with respect to the transactions
contemplated by this Agreement and supersedes all prior
negotiations, arrangements or understandings, written or oral, with
respect thereto.
8.6. Counterparts. This Agreement may be executed
in one or more counterparts, all of which shall be considered one
and the same agreement and each of which shall be deemed an
original.
8.7. Governing Law. This Agreement shall be
governed by the laws of the State of New Jersey, without giving
effect to the principles of conflicts of laws thereof.
8.8. Descriptive Headings. The descriptive
headings of this Agreement are for convenience only and shall not
control or affect the meaning or construction of any provision of
this Agreement.
IN WITNESS WHEREOF, Hubco, the Bank and Jefferson
have caused this Agreement to be executed by their duly authorized
officers as of the day and year first above written.
ATTEST: HUBCO, Inc.
By:________________________ By:_____________________________
, Secretary Kenneth T. Neilson, President
ATTEST: HUDSON UNITED BANK
By:________________________ By:_____________________________
, Secretary Kenneth T. Neilson, President
ATTEST: JEFFERSON NATIONAL BANK
By:________________________ By:_____________________________
, Cashier Raymond L. Sisco, Chairman
<PAGE>
EXHIBIT 5.17
FORM OF JEFFERSON AFFILIATE LETTER
October __, 1994
HUBCO, Inc.
3100 Bergenline Avenue
Union City, NJ 07087
Gentlemen:
I am delivering this letter to you in connection with the
proposed merger (the "Merger") of Jefferson National Bank, a
national banking association (the "Company") with and into Hudson
United Bank, a New Jersey chartered commercial banking corporation,
pursuant to the Agreement and Plan of Merger dated October 7, 1994,
(the "Agreement") among the Company, HUBCO, Inc. ("Hubco"), and
Hudson United Bank. I currently own shares of the Company's common
stock, par value $6.00 per share ("Jefferson Common Stock"). As a
result of the Merger, I will receive shares of Hubco's common
stock, no par value ("Hubco Common Stock") in exchange for my
Jefferson Common Stock.
I have been advised that as of the date of this letter I may
be deemed to be an "affiliate" of the Company, as the term
"affiliate" is defined for purposes of paragraphs (c) and (d) of
Rule 145 of the rules and regulations promulgated under the
Securities Act of 1933, as amended (the "1933 Act") by the
Securities and Exchange Commission ("SEC") and as the term
"affiliate" is used for purposes of the SEC's rules and regulations
applicable to the determination of whether a merger can be
accounted for as a "pooling of interests" as specified in the SEC's
Accounting Series Release 135, as amended by Staff Accounting
Bulletins Nos. 65 and 76 ("ASR 135").
I represent to and agree with Hubco that:
A. Transfer Review Restrictions. During the period beginning
on the date hereof and ending 30 days prior to the consummation of
the Merger, I shall not sell, transfer or otherwise dispose of
("transfer") any Jefferson Common Stock owned by me, and I shall
not permit any relative who shares my home, or any person or entity
who or which I control, to transfer any Jefferson Common Stock
owned by such person or entity, without notifying Hubco in advance
of the proposed transfer and giving Hubco a reasonable opportunity
to review the transfer before it is consummated. Hubco, if advised
to do so by its independent public accountants, may instruct me not
to make or permit the transfer because it may interfere with the
"pooling of interests" treatment of the Merger. I shall abide by
any such instructions.
B. Transfer Restrictions During Merger Consummation
Period. I shall not transfer any Jefferson Common Stock owned by
me, and I shall not permit any relative who shares my home, or any
person or entity who or which I control, to transfer any Jefferson
Common Stock owned by such person or entity during the period
beginning 30 days prior to the consummation of the Merger and
ending immediately after financial results covering at least 30
days of post-Merger combined operations have been published by
Hubco by means of the filing of a Form 10-Q or Form 8-K under the
Securities Exchange Act of 1934, as amended, the issuance of a
quarterly earnings report, or any other public issuance which
satisfies the requirements of ASR 135. For purposes of this
paragraph only, "Jefferson Common Stock" includes Hubco Common
Stock into which my Jefferson Common Stock is converted.
C. Compliance with Rule 145. I have been advised that
the issuance of Hubco Common Stock to me pursuant to the Merger
will be registered with the SEC under the 1933 Act on a
Registration Statement on Form S-4. However, I have also been
advised that, since I may be deemed to be an affiliate of the
Company at the time the Merger is submitted for a vote of the
Company's stockholders, any transfer by me of Hubco Common Stock is
restricted under Rule 145 promulgated by the SEC under the 1933
Act. I agree not to transfer the Hubco Common Stock received by me
or any of my affiliates unless (i) such transfer is made in
conformity with the volume and other limitations of Rule 145
promulgated by the SEC under the 1933 Act, (ii) in the opinion of
Hubco's counsel or counsel reasonably acceptable to Hubco, such
transfer is otherwise exempt from registration under the 1933 Act
or (iii) such transfer is registered under the 1933 Act.
D. Stop Transfer Instructions; Legend on Certificates.
I also understand and agree that stop transfer instructions will be
given to Hubco's transfer agents with respect to the Hubco Common
Stock received by me and any of my affiliates and that there will
be placed on the certificates of the Hubco Common Stock issued to
me and any of my affiliates, 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 ONLY BE TRANSFERRED IN ACCORDANCE WITH THE
TERMS OF AN AGREEMENT DATED OCTOBER __, 1994 BETWEEN THE
REGISTERED HOLDER HEREOF AND HUBCO, INC., A COPY OF WHICH
AGREEMENT IS ON FILE AT THE PRINCIPAL OFFICES OF HUBCO, INC."
E. Consultation with Counsel. I have carefully read
this letter and the Agreement and discussed the requirements of
such documents and other applicable limitations upon my ability to
transfer Hubco Common Stock to the extent I felt necessary with my
counsel or counsel for the Company.
Execution of this letter is not an admission on my part
that I am an "affiliate" of the Company as described in the second
paragraph of this letter, or a waiver of any rights I may have to
object to any claim that I am such an affiliate on or after the
date of this letter. This letter shall terminate concurrently with
any termination of the Agreement in accordance with its terms.
Very truly yours,
_____________________________
Name:
Accepted this _____ day of
October, 1994 by
HUBCO, INC.
By:_________________________
<PAGE>
EXHIBIT 6.2
FORM OF OPINION OF COUNSEL TO JEFFERSON
TO BE DELIVERED TO HUBCO ON THE EFFECTIVE TIME
(a) Jefferson National Bank ("Jefferson") is a national
banking association duly organized, validly existing and in good
standing under the laws of the United States. Jefferson has the
corporate power and authority to own or lease all of its properties
and assets and to carry on its business as it is now being
conducted and is duly licensed or qualified to do business and is
in good standing in each jurisdiction in which the nature of the
business conducted by it or the character or location of the
properties and assets owned or leased by it makes such licensing or
qualification necessary, except where the failure to be so
licensed, qualified or in good standing would not have a material
adverse effect on the business, operations, assets or financial
condition of Jefferson.
(b) The deposit accounts of depositors in Jefferson are
insured up to applicable limits by the Federal Deposit Insurance
Corporation.
(c) The authorized capital stock of Jefferson consists
of ___________ shares of common stock, _____ par value per share
(the "Jefferson Shares"). The stockholders of Jefferson have
preemptive rights with respect to shares of the capital stock of
Jefferson pursuant to the Articles of Association of Jefferson or
otherwise. Jefferson does not have any authorized class of capital
stock other than shares of its common stock and, to the best of our
actual knowledge after inquiry, there are no outstanding
subscription rights, options, conversion rights, warrants or other
agreements or commitments of any nature whatsoever (either firm or
conditional) obligating Jefferson to issue, deliver or sell, cause
to be issued, delivered or sold, or restricting Jefferson from
selling any additional Jefferson Shares or obligating Jefferson to
grant, extend or enter into any such agreement or commitment.
(d) The Agreement has been duly authorized, executed and
delivered by Jefferson, and constitutes the valid and binding
obligation of Jefferson enforceable in accordance with its terms,
except that the enforceability of the obligations of Jefferson may
be limited by bankruptcy, fraudulent conveyance, insolvency,
moratorium, reorganization or other laws heretofore or hereafter
enacted relating to or affecting the rights of creditors generally
and by equitable principles limiting the right to obtain specific
performance or other similar equitable relief (regardless of
whether such enforceability is considered in a proceeding in equity
or at law). In addition, certain remedial and other provisions of
the Agreement may be limited by implied covenants of good faith,
fair dealing, and commercially reasonable conduct, by judicial
discretion in the instance of equitable remedies, and by applicable
public policies and laws.
(e) The execution and delivery of the Agreement and the
consummation of the transactions contemplated thereby will not (i)
conflict with or violate any provision of, or result in the breach
of any provision of, the Articles of Association or the by-laws of
Jefferson; (ii) to our actual knowledge after inquiry, conflict
with or violate in any material respect or result in a material
breach or violation of the terms or provisions of, or constitute a
material default under, or result in or entitle any party to the
acceleration of (whether upon or after the giving of notice or
lapse of time or both) any material obligation under, any material
indenture, mortgage, deed of trust or loan agreement or any other
material agreement, instrument, judgment, order, arbitration award
or decree to which Jefferson is a party or by which Jefferson is
bound; or (iii) cause Jefferson to violate any statute, rule,
regulation or order known to us applicable to Jefferson, except
with respect to (ii) and (iii) above, such as in the aggregate will
not have a material adverse effect on the ability of Jefferson to
consummate this transaction.
(f) All actions required by law, the Articles of
Association of Jefferson or its By-laws to be taken by the
directors and stockholders of Jefferson to authorize the execution,
delivery and performance of the Agreement and consummation of the
Merger and the actions contemplated thereby have been duly taken.
(g) Assuming that there has been due authorization of
the Merger by all necessary corporate and governmental proceedings
on the part of HUBCO, Inc. ("Hubco") and that Hubco has taken all
action required to be taken by it prior to the Effective Time, upon
the appropriate filings with the bank regulatory authorities in
respect of the Merger in accordance with Section 1.6 of the
Agreement, the Merger will become effective and each of the
Jefferson Shares will be extinguished and converted as provided in
Article II of the Agreement.
(h) All approvals, authorizations, consents or other
actions and all filings under federal law and any applicable state
law required to be obtained by Jefferson ("Approvals") in order to
permit the execution and delivery of the Agreement and the
performance of the transactions contemplated therein in connection
with the Merger have been obtained. No Approval of any other party
or entity (other than Hubco and Approvals required to be obtained
by Hubco) is required in connection with the execution, delivery
and performance by Jefferson of its obligations under the Agreement
except for Approvals not required or necessary to be obtained on
the date hereof, and except for approvals the failure to obtain
which individually or in the aggregate will not have a material
adverse effect on the business, operations, assets or financial
condition of Jefferson, and which will not prevent or delay the
consummation of the transactions contemplated by the Agreement.
(i) We are not passing upon and do not assume any
responsibility for the accuracy, completeness or fairness of the
statements contained in the Proxy Statement/Prospectus and make no
representation that we have independently verified the accuracy,
completeness or fairness of such statements, but from our
examination of the Proxy Statement/Prospectus and our general
familiarity with the affairs of Jefferson, no facts have come to
our attention that caused us to believe that (except for financial
statements, other tabular financial information, and other
financial and statistical data and information, as to which we do
not express any belief) the Proxy Statement/Prospectus on the date
of the mailing thereof and on the date of the meeting of
stockholders of Jefferson at which the Agreement was approved,
contained any untrue statement of a material fact regarding
Jefferson or the Merger or omitted to state a material fact
regarding Jefferson or the Merger necessary in order to make the
statements regarding Jefferson or the Merger therein, in light of
the circumstances under which they were made, not misleading.
(j) To our actual knowledge after inquiry and except as
set forth in the Jefferson Disclosure Schedule, and other than
ordinary routine litigation incidental to the business of Jefferson
there are no actions, suits or proceedings or investigations
pending or threatened against or affecting the business,
operations, property or financial condition of Jefferson, at law or
in equity, in any court or before any federal, state, municipal or
other governmental department, commission, board, bureau, agency or
instrumentality, except those which, if decided adversely to
Jefferson, would not have a material adverse effect on the
business, operations, assets or financial condition of Jefferson.
Except as disclosed in the Jefferson Disclosure Schedule, to our
actual knowledge after inquiry, Jefferson is not in default with
respect to any order, writ, injunction or decree of any court or of
any Federal, state, municipal or other governmental department,
commission, board, bureau, agency or authority, to which they or
their properties are subject.
(k) To our actual knowledge after inquiry, Jefferson has
all material permits, licenses, orders and approvals of all
governmental or regulatory bodies required to conduct its business
under applicable Federal and state laws and regulations, except for
those permits, licenses, orders and approvals as to which the
failure to obtain would not have a material adverse effect on the
business, operations, assets or financial condition of Jefferson.
In rendering their opinion, such counsel may rely, (A) as
to matters involving the application of laws of any jurisdiction
other than New Jersey and the United States, to the extent such
counsel deems proper and specifies in such opinion, upon the
opinion of other counsel of good standing believed by such counsel
to be reliable (providing that such counsel states that Hubco is
justified in relying upon such specified opinion or opinions) and
(B) as to matters of fact to the extent such counsel deems proper,
upon certificates of responsible officers of Jefferson and public
officials; provided copies of any such opinions or certificate are
delivered to Hubco together with the opinion to be rendered
hereunder by counsel to Jefferson. Such counsel may assume that
any agreement is a valid and binding obligation of any parties to
such agreement other than Jefferson. Such counsel may also rely,
as to facts, upon the representations and warranties made by
Jefferson in the Agreement and on the genuineness of signatures and
the authenticity of copies.<PAGE>
EXHIBIT 6.3
FORM OF OPINION OF COUNSEL TO HUBCO
TO BE DELIVERED TO JEFFERSON ON THE EFFECTIVE TIME
(a) HUBCO, Inc. ("Hubco") is a corporation duly
organized and validly existing and in good standing under the laws
of the State of New Jersey. Hubco has the corporate power and
authority to own or lease all of its properties and assets and to
carry on its business as it is now being conducted, and is duly
licensed or qualified to do business and is in good standing in
each jurisdiction in which the nature of the business conducted by
it or the character or location of the properties and assets owned
or leased by it makes such licensing or qualification necessary,
except where the failure to be so licensed, qualified or in good
standing would not have a material adverse effect on the business,
operations, assets or financial condition of Hubco and the Bank,
taken as a whole. Hubco is registered as a bank holding company
under the Bank Holding Company Act of 1956, as amended.
(b) Hudson United Bank (the "Bank") is a commercial bank
duly organized, validly existing and in good standing under the
laws of the State of New Jersey. The Bank has the corporate power
and authority to own or lease all of its properties and assets and
to carry on its business as it is now being conducted and is duly
licensed or qualified to do business and is in good standing in
each jurisdiction in which the nature of the business conducted by
it or the character or location of the properties and assets owned
or leased by it makes such licensing or qualification necessary,
except where the failure to be so licensed, qualified or in good
standing would not have a material adverse effect on the business,
operations, assets or financial condition of Hubco and the Bank,
taken as a whole.
(c) The authorized capital stock of Hubco consists of
___________ shares of common stock, no par value per share ("Common
Stock") and __________ shares of preferred stock (the "Authorized
Preferred Stock"). The stockholders of Hubco have no preemptive
rights with respect to such shares pursuant to the Certificate of
Incorporation of Hubco or otherwise. Hubco represents that it
presently has outstanding ______ shares of Series A Preferred
Stock, which constitutes all of the outstanding Authorized
Preferred Stock. Except for any Common Stock issuable upon
exercise of outstanding stock options granted pursuant to the Hubco
Director Stock Option Plan, to the best of our actual knowledge
after inquiry, there are no outstanding subscription rights,
options, conversion rights, warrants or other agreements or
commitments of any nature whatsoever (either firm or conditional)
obligating Hubco to issue, deliver or sell, cause to be issued,
delivered or sold, or restricting Hubco from selling any additional
Common Stock or Authorized Preferred Stock or obligating Hubco to
grant, extend or enter into any such agreement or commitment,
except as may be provided in any acquisition agreement Hubco may
enter into after the date of execution of the Agreement. The
outstanding shares of capital stock of each Hubco subsidiary
represented by Hubco to be all of the outstanding shares of such
subsidiary have been validly authorized and issued and are fully
paid and, to the best of our knowledge after due inquiry, are owned
by Hubco free and clear from any liens, claims, equities,
restrictions or encumbrances created by or through Hubco.
(d) The Agreement has been duly authorized, executed and
delivered by Hubco and the Bank, and constitutes the valid and
binding obligations of Hubco and the Bank enforceable in accordance
with its terms, except that the enforceability of the obligations
of Hubco and the Bank may be limited by bankruptcy, fraudulent
conveyance, insolvency, reorganization, moratorium, or other laws
heretofore or hereafter enacted relating to or affecting the
enforcement of creditors' rights generally and by principles of
equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law). In addition, certain remedial
and other provisions of the Agreement may be limited by implied
covenants of good faith, fair dealing, and commercially reasonable
conduct, by judicial discretion, in the instance of equitable
remedies, and by applicable public policies and laws.
(e) The execution and delivery of the Agreement and the
consummation of the transactions contemplated thereby will not (i)
conflict with or violate any provision of or result in the breach
of any provision of the respective Certificate of Incorporation, or
the By-laws of Hubco or the Bank; (ii) to our actual knowledge
after inquiry, conflict with or violate in any material respect or
result in a material breach or violation of the terms or provisions
of, or constitute a material default under, or result in (whether
upon or after the giving of notice or lapse of time or both) any
material obligation under, any material indenture, mortgage, deed
of trust or loan agreement or any other material agreement,
instrument, judgment, order, arbitration award or decree to which
Hubco or the Bank is a party, or by which Hubco or the Bank is
bound; or (iii) cause Hubco or the Bank to violate any law,
ordinance, rule or regulation applicable to Hubco or the Bank,
except with respect to (ii) and (iii) above, such as in the
aggregate will not have a material adverse effect on the ability of
Hubco and the Bank to consummate this transaction.
(f) All actions of the directors and stockholders of
Hubco and the Bank required by law, the respective Certificate of
Incorporation of Hubco or the Bank or their respective by-laws to
be taken by Hubco or the Bank to authorize the execution, delivery
and performance of the Agreement and consummation of the Merger
have been duly taken.
(g) Assuming that there has been due authorization of
the Merger by all necessary corporate and governmental proceedings
on the part of Jefferson and that Jefferson has taken all action
required to be taken by it prior to the Effective Time, upon the
appropriate filings with the bank regulatory authorities in respect
of the Merger in accordance with Section 1.6 of the Agreement, the
Merger will become effective and each of the Jefferson Shares will
be extinguished and converted as provided in Article II of the
Agreement and the shares of Hubco Common Stock to be issued thereby
will have been validly issued by Hubco and fully paid.
(h) All approvals, authorizations, consents or other
actions and all filings under federal law and any applicable state
law required to be obtained by Hubco or the Bank ("Approvals") in
order to permit the execution and delivery of the Agreement and the
performance of the transactions contemplated therein in connection
with the Merger have been obtained. No consent of any other party
or entity (other than Jefferson and approvals, authorizations,
consents and other actions required to be obtained by Jefferson) is
required in connection with the execution, delivery and performance
by Hubco or the Bank of their obligations under the Agreement,
except for Approvals not required or necessary to be obtained on
the date hereof.
(i) We are not passing upon and do not assume any
responsibility for the accuracy, completeness or fairness of the
statements contained in the Proxy Statement/Prospectus and make no
representation that we have independently verified the accuracy,
completeness or fairness of such statements, but from our
examination of the Proxy Statement/Prospectus and our general
familiarity with Hubco (i) we are of the opinion that the Proxy
Statement/Prospectus and any supplements or amendments thereto
(except for financial statements and other tabular financial
information, and other financial and statistical data and
information, as to which such counsel need not express any opinion)
comply as to form in all material respects with the Securities Act
of 1933, as amended, and the applicable laws and regulations
thereunder (the "1933 Act"), (ii) no facts have come to our
attention that caused us to believe that (except for financial
statements and other tabular financial information, as to which we
do not express any belief) the Proxy Statement/Prospectus on the
date of the mailing thereof and on the date of the meeting of
stockholders of Jefferson at which the Agreement was approved,
contained any untrue statement of a material fact regarding Hubco,
the Bank, or the Merger or omitted to state a material fact
regarding Hubco, the Bank, or the Merger necessary in order to make
the statement regarding Hubco, the Bank, or the Merger therein, in
light of the circumstances under which they were made, not
misleading.
(j) To our actual knowledge after inquiry and except as
set forth in the Hubco Disclosure Schedule, and other than ordinary
routine litigation incidental to the business of Hubco or its
subsidiaries, there is no material action, suit or proceeding or
investigation pending or threatened against or affecting the
business, operations, property or financial condition of Hubco or
the Hubco Subsidiaries, at law or in equity, in any court or before
any Federal, state, municipal or other governmental department,
commission, board, bureau, agency or instrumentality, except those
which, if decided adversely to Hubco or its subsidiaries, would not
have a material adverse effect on the business, operations, assets
or financial condition of Hubco and the Bank, taken as a whole;
provided, however, we are not counsel to Hubco or the Bank in any
litigation and with respect to any such litigation we are relying
upon the opinions of general counsel to Hubco with respect to such
litigation. To our knowledge, Hubco and the Bank are not in
default with respect to any order, writ, injunction or decree of
any court or of any federal, state, municipal or other governmental
department, commission, board, bureau, agency or authority, to
which their properties are subject.
(k) To our actual knowledge after inquiry, each of Hubco
and the Bank have all material permits, licenses, orders and
approvals of all governmental or regulatory bodies required for it
to conduct its business under applicable state and Federal laws and
regulations, except for those permits, licenses, orders and
approvals as to which the failure to obtain would not have a
material adverse effect on the business, operations, assets or
financial condition of Hubco and the Bank taken as a whole. None
of such material permits, licenses, orders or approvals will be
adversely affected by the consummation of the transactions
contemplated by the Agreement except for such permits, licenses,
orders or approvals, the loss of which would not have a material
adverse effect on the business, financial condition or results of
operations of Hubco and the Bank taken as a whole.
(l) The registration statement of Hubco has been
declared effective by the Securities and Exchange Commission
("SEC") under the 1933 Act and, to our actual knowledge, no stop
order suspending the effectiveness has been issued under the 1933
Act or proceedings therefor initiated or threatened by the SEC.
In rendering their opinion, such counsel may rely, (A) as
to matters involving the application of laws of any jurisdiction
other than the United States or the State of New Jersey, to the
extent such counsel deems proper and specifies in such opinion,
upon the opinion of other counsel of good standing believed by such
counsel to be reliable (providing that such counsel states that
Jefferson is justified in relying upon such specified opinion or
opinions) and (B) as to matters of fact, to the extent such counsel
deems proper, upon certificates of responsible officers of Hubco,
the Bank and public officials; provided copies of any such opinions
or certificate are delivered to Jefferson together with the opinion
to be rendered hereunder by counsel to Hubco. Such counsel may
assume that any agreement is the valid and binding obligation of
any parties to such agreement other than Hubco. Such counsel may
also rely as to facts, upon the representations and warranties made
by Hubco in the Agreement and the genuineness of signatures and the
authenticity of copies.
