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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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): April 10, 1996
FWB Bancorporation
(Exact name of registrant as specified in its charter)
Maryland 0-16187 52-1332050
(State or other jurisdiction (Commission file (IRS Employer
of incorporation) number) Identification Number)
1800 Rockville Pike, P.O. Box 2022, Rockville, Maryland 20852
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (301) 770-1300
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Item 5. Other Events.
On April 10, 1996, FWB Bancorporation ("FWB") and its wholly owned
Maryland chartered bank subsidiary, FWB Bank, Rockville, Maryland (the "Bank")
entered into a Purchase and Assumption Agreement (the "Agreement") with First
Commonwealth Financial Corp ("FCFC") and its wholly owned federal savings bank
subsidiary, First Commonwealth Savings Bank FSB, Alexandria, Virginia ("FSB"),
pursuant to which the Bank will acquire certain loans and assume certain deposit
liabilities relating to the Alexandria, Virginia branch of FSB (the "Branch"),
and FWB will purchase certain real and personal property relating to the Branch.
As of April 10, 1996, the aggregate amount of deposits to be assumed was
approximately $66.1 million, and the aggregate principal amount of loans to be
acquired was approximately $39.7 million, subject in each case to adjustment in
accordance with the provisions of the Agreement.
In connection with, and contingent upon, the consummation of the
Agreement, FWB will sell approximately 666,666 newly issued shares of common
stock, par value $.10 per share, in a private placement offering to a limited
number of accredited investors, at a price of $3.00 per share, and the Bank will
sell 200,000 shares of its redeemable Series A Preferred Stock, par value $10.00
per shares, to FCFC at a price of $10.00 per share. The prices for the shares
of FWB common stock and Bank preferred stock being sold in connection with the
consummation of the Agreement were negotiated between the parties to the
Agreement and do not necessarily represent the fair market, intrinsic or trading
value of the common stock or the preferred stock. In connection with the
purchase of the preferred stock, FCFC will also receive a Warrant to purchase up
to one million shares of FWB common stock. The Warrant is exercisable at any
time after the first anniversary of the Warrant and prior to the fifth
anniversary of the Warrant. The Warrant may be exercised only by tender of
shares of the Series A Preferred Stock of the Bank. The exercise price of the
Warrant, denominated in terms of par value of the Series A Preferred Stock,
decreases over the life of the Warrant from a maximum of $2.55 per share of
common stock to a minimum of $1.87 per share of common stock. The Series A
Preferred Stock, which bears no dividend, may be redeemed at the option of the
Bank and subject to regulatory approval, in whole or in part, from time to time,
at par value.
The Agreement and the transactions contemplated thereby are subject to
numerous conditions, including regulatory approval. Assuming the satisfaction
of all conditions to each party's obligation to consummation, it is anticipated
that the transactions contemplated by the Agreement will become effective in the
third quarter of 1996.
Item 7. Financial Statements and Exhibits.
(a) Exhibit 2 - Purchase and Assumption Agreement, dated as of April 10, 1996,
by and among FWB Bancorporation, FWB Bank, First Commonwealth Savings Bank
FSB and First Commonwealth Financial Corporation
(b) Exhibit 99 - Press Release dated April 10, 1996
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Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
FWB Bancorporation
By: /s/ Steven K. Colliatie
----------------------------------
Steven K. Colliatie, President
Dated : April 18, 1996
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PURCHASE AND ASSUMPTION AGREEMENT
By and Among
FWB BANCORPORATION
FWB BANK
FIRST COMMONWEALTH SAVINGS BANK FSB
and
FIRST COMMONWEALTH FINANCIAL CORP
as of
April 10, 1996
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PURCHASE AND ASSUMPTION AGREEMENT
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C>
Recitals................................................................. 1
Article 1 - Definitions.................................................. 1
Article 2 - Terms of Purchase............................................ 4
2.1 Purchase and Sale of Assets........................................ 5
2.2 Purchase and Sale of Real Property and Fixed Assets................ 5
2.3 Assumption of Liabilities.......................................... 5
2.4 Prorations; Sales, Transfer and Income Taxes....................... 6
Article 3 - Transfer of Assets........................................... 7
3.1 Branch Loans....................................................... 8
3.2 Fixed Assets....................................................... 8
3.3 Real Property...................................................... 8
3.4 Records............................................................ 8
Article 4 - Closing...................................................... 8
4.1 Closing............................................................ 8
4.2 Closing Payment.................................................... 9
4.3 Closing Adjustment................................................. 9
4.4 Dispute Resolution................................................. 9
4.5 Investment by FCFC Group and Investors............................. 9
4.6 Deliveries by SELLER and FCFC...................................... 10
4.7 Deliveries by BUYER and BANCORP.................................... 10
Article 5 - Representations and Warranties of BUYER and BANCORP.......... 10
5.1 Representations and Warranties of BUYER............................ 10
5.2 Representations and Warranties of BANCORP.......................... 11
Article 6 - Representations and Warranties of SELLER and FCFC........... 12
6.1 Representations and Warranties of SELLER........................... 12
6.2 Representations and Warranties of FCFC............................. 14
Article 7 - Covenants of BUYER and BANCORP............................... 15
7.1 Assistance in Obtaining Regulatory Approvals....................... 15
7.2 Fiduciary Relationships............................................ 15
7.3 Performance of Liabilities......................................... 15
7.4 Further Assurances................................................. 15
7.5 Governmental Consents.............................................. 15
7.6 Other Consents..................................................... 15
7.7 Confidential Information........................................... 16
Article 8 - Covenants of SELLER.......................................... 16
8.1 Assistance in Obtaining Regulatory Approvals....................... 16
8.2 Access to Branch Records and Information; Personnel; Customers..... 16
8.3 Conduct of Business Pending Closing................................ 17
</TABLE>
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<TABLE>
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8.4 No Encumbrances.................................................... 17
8.5 Governmental Consents.............................................. 17
8.6 Other Consents..................................................... 17
8.7 Maintenance of Accounts............................................ 18
8.8 Books and Records.................................................. 18
8.9 Signs.............................................................. 18
8.10 Clean Branch....................................................... 18
8.11 Indemnification for Special SAIF Assessment........................ 18
8.12 Further Assurances................................................. 19
Article 9 - Covenant Not To Compete...................................... 19
9.1 Non-Compete Period and Geographic Area.............................. 19
9.2 Solicitation........................................................ 19
Article 10 - Conditions to Closing....................................... 19
10.1 Conditions to Obligations of SELLER and FCFC....................... 19
10.2 Conditions to the Obligations of BUYER and BANCORP................. 20
Article 11 - Termination................................................. 22
11.1 Conditions for Termination......................................... 22
11.2 Effect of Termination.............................................. 23
Article 12 - Employees................................................... 24
12.1 Access to Branch Employee Records; Interviews, Offers to Hire...... 24
12.2 Certain Responsibilities........................................... 24
12.3 Employment Contracts and Benefit Plans; No
Enforceable Employee Rights.................................... 24
12.4 Communication with Employees....................................... 24
Article 13 - Other Agreements............................................ 25
13.1 Payment of Items Following Closing; Other Transition Arrangements.. 25
13.2 Holds, Cautions and Levies......................................... 26
13.3 Withholding........................................................ 26
13.4 Retirement Accounts................................................ 26
13.5 Interest Reporting................................................. 27
13.6 Magnetic Tape of Branch Deposits................................... 27
13.7 ATM Card Processing................................................ 27
13.8 Overdraft Coverage................................................. 27
13.9 Taxpayer Information............................................... 27
13.10 Account Statements................................................. 28
13.11 Posting of Interest................................................ 28
13.12 Allocation of Asset Values and Reporting Thereof................... 28
13.13 Conversion Cooperation............................................. 28
Article 14 - General Provisions.......................................... 28
14.1 Survival........................................................... 28
14.2 Indemnification.................................................... 28
14.3 Consultant's Fees.................................................. 30
14.4 Publicity.......................................................... 30
14.5 Incorporation of Exhibits.......................................... 30
14.6 Attorney's Fees.................................................... 30
14.7 Notices............................................................ 30
14.8 Arms Length Transactions........................................... 31
14.9 Assignment......................................................... 31
</TABLE>
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<TABLE>
<S> <C>
14.10 Successors and Assigns............................................. 31
14.11 Third Party Beneficiaries.......................................... 31
14.12 Governing Law...................................................... 31
14.13 Entire Agreement................................................... 32
14.14 Headings........................................................... 32
14.15 Severability....................................................... 32
14.16 Waiver............................................................. 32
14.17 Numbers............................................................ 32
14.18 Counterparts....................................................... 32
14.19 Cooperation........................................................ 32
SIGNATURES............................................................... 33
</TABLE>
Exhibit A - Preferred Stock Purchase Agreement
Exhibit B - Warrant and Voting Agreement
Exhibit C - Stock Purchase Agreement
Exhibit D - Description of Real Property
Exhibit E - Bill of Sale and Assignment
Exhibit F - Assignment and Assumption Agreement
Exhibit G - Assignment, Transfer and Appointment of Successor Trustee
Exhibit H - Opinion of Counsel to BANCORP
Exhibit I - Opinion of Counsel to BUYER
Exhibit J - Opinion of Counsel to SELLER
Exhibit K - Opinion of Counsel to FCFC
Schedule 1 - Schedule of Branch Deposits Pursuant to Section 2.3
Schedule 2 - Schedule of Certain Obligations Not Customarily undertaken by
Depository Institutions in the Commonwealth of Virginia Pursuant
to Section 2.3(d)
Schedule 3 - Schedule of Loans Eligible to be Branch Loans Pursuant to
Section 3.1
Schedule 4 - Schedule of Fixed Assets Pursuant to Section 3.2
Schedule 5 - Schedule of Books and Records to be Delivered to BUYER on or before
Closing Pursuant to Section 3.4
Schedule 6 - Schedule of Senior Officers of SELLER Pursuant to Section 1.1
Schedule 7 - Holds, Cautions and Levies Pursuant to Section 13.2
Schedule 8 - Reserved
Schedule 9 - Schedule of Environmental Exceptions Pursuant to Section 6.1(c)
Schedule 10- Schedule of Employees Pursuant to Section 12.1
Schedule 11- Schedule of Agreements, Orders, Etc. Pursuant to Sections 6.1(a)
and 6.1(d)
Schedule 12- Schedule of Agreements, Orders, Etc. Pursuant to Section 6.2
Schedule 13- Schedule of Loan Deemed "Special Mention" by OTS Pursuant to
Section 1.1
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PURCHASE AND ASSUMPTION AGREEMENT
AGREEMENT made as of this 10th day of April 1996, by and among FWB Bank, a
commercial bank chartered under the laws of the State of Maryland, with its main
office at 1800 Rockville Pike, Rockville, Maryland, ("BUYER"); FWB
Bancorporation, a Maryland corporation and the registered bank holding company
of BUYER, with its principal place of business at the same address as
BUYER("BANCORP"); First Commonwealth Savings Bank FSB, a federal savings bank
chartered under the laws of the United States, with its main office at 301 South
Washington Street, Alexandria, Virginia ("SELLER"); and First Commonwealth
Financial Corp, a Virginia corporation and registered savings and loan holding
company of the SELLER, with its principal place of business located at 12105
Greenleaf Avenue, Potomac, Maryland ("FCFC").
RECITALS
WHEREAS, BUYER wishes to assume certain deposits and other liabilities
associated with the main office of SELLER (the "Branch") and to acquire certain
assets of SELLER;
WHEREAS, BANCORP wishes to acquire certain real property and fixed assets of
SELLER;
WHEREAS, SELLER desires to transfer and sell to BUYER such deposit and other
liabilities and assets and desires to transfer and sell to Bancorp such real
property and fixed assets;
WHEREAS, FCFC or its permitted assigns ("FCFC Group") desires to invest in
BUYER by purchase of BUYER's preferred stock; and
WHEREAS, BUYER and SELLER seek to provide for an orderly transfer and sale and
to provide for certain undertakings, conditions, warranties, representations and
covenants in connection with the transaction contemplated hereby.
NOW THEREFORE, in consideration of the mutual promises hereinafter contained
and other good and valuable consideration, the parties hereto do hereby agree as
follows:
ARTICLE 1
DEFINITIONS
1.1 Definitions. As used in this Agreement, the following terms have the
definitions indicated.
"Accrued Interest Payable" means interest on Deposits which is accrued but has
neither been posted to a deposit account nor paid as of the Closing Date.
"Accrued Interest Receivable" means interest on loans which is accrued but
unpaid as of the Closing Date.
"ACH" means automated clearing house.
"Affiliate" of a party means any person, partnership, corporation, association
or other legal entity directly or indirectly controlling, controlled by or under
common control with that party.
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"Assets" means (i) the Branch Loans, (ii) the Records (including, without
limitation, lists of customers), (iii) all cash and coin on hand at the Branch
("Cash"), and (iv) any related scheduled identifiable intangible assets
including, without limitation, any Core Deposit Intangible as of the close of
business on the Closing Date.
"BIF" means the Bank Insurance Fund of the FDIC.
"Branch Deposit" means a Deposit, including Accrued Interest Payable thereon,
which has been opened at or assigned to the Branch Office, other than Excluded
Deposits as of the close of business of the Closing Date, which Branch Deposits
shall be listed on Schedule 1.
"Branch Loan" means a loan listed on Schedule 3, hereto in accordance with
Section 3.1 of this Agreement, together with any Accrued Interest Receivable
thereon and related Servicing Rights; provided that Branch Loans do not include:
(i) loans which are past due as to interest or principal by sixty (60) days or
more; (ii) loans which have been classified by the OTS at its most recent
examination of the SELLER as "special mention", "substandard, " "doubtful" or
"loss," except as listed on Schedule 13; (iii) Accrued Interest Receivable on
such excluded loans; and (iv) Servicing Rights with respect to such excluded
loans.
"Branch" or "Branch Office" means SELLER's office located at 301 South
Washington, Street, Alexandria, Virginia.
"Brokered Deposit" means a deposit obtained, directly or indirectly, by or
through any deposit broker as defined in Section 29f(g) of the Federal Deposit
Insurance Act, 12 U.S.C. (S)1831f(g), without regard to whether or not the
depository institution in which such funds are deposited is not well capitalized
for purposes of that Section.
"Business Day" means any Monday, Tuesday, Wednesday, Thursday, or Friday that
is not a Federal or State holiday generally recognized by banks or savings
associations in the State of Maryland or the Commonwealth of Virginia.
"Closing" and "Closing Date" shall have the meanings set forth in Section 4.1.
"Closing Payment" shall have the meaning set forth in Section 4.2.
"Common Stock" means the common stock of Bancorp, par value $.10 per share.
"Core Deposit Intangible" means the value of the future stream of net income
derived from core deposits.
"Cost of Funds" for a particular day is the average of the high and low
Federal Funds Rate quotations as reported in the Wall Street Journal, or if not
reported for such day, the average of such quotations for the last previous day
for which such quotations were reported.
"Covenant Not To Compete" shall mean the covenants and agreements set forth in
Article 9 hereof.
"Demand Deposits" means personal, commercial, business and negotiable deposit
accounts payable on demand and includes, without limitation, Negotiable Order of
Withdrawal Accounts.
"Deposit" shall have the meaning set forth in Section 3(l) of the Federal
Deposit Insurance Act, 12 U.S.C. (S)1813(l).
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"Depository Institution" means any bank or savings association as those terms
are defined in Section 3(c) of the Federal Deposit Insurance Act, 12 U.S.C.
(S)1813(c), and any credit union.
"Deposit Premium" shall mean:
(a) the greater of $1.2 Million, or the Deposit Premium Percentage (2.0%)
multiplied by the Branch Deposits (less the balance of any Jumbo Deposits
or Keogh Deposits included in Branch Deposits) as of the Closing; reduced
by
(b) the product of the Deposit Premium Percentage times the decrease, if any,
in the aggregate balance of Branch Deposits other than certificates of
deposit and Keogh Deposits between March 31, 1996 and the Closing Date;
provided that, for purposes of calculation of the Deposit Premium, overdrafts
(deficit balances) will not be removed, but will be netted against credit
balances of Branch Deposits.
"Employees" means the employees assigned to the Branch Office at the Closing
Date and listed on Schedule 10.
"Encumbrances" means all mortgages, claims, charges, liens, easements,
restrictions, options, pledges, calls, commitments, security interests,
conditional sales agreements, title retention agreements, leases or other
restrictions of any kind whatsoever.
"ERISA" means the Employee Retirement Income Security Act of 1974, as amended.
"Excluded Deposits" means, except as agreed by BUYER in its sole discretion,
(i) Brokered Deposits, (ii) such other Branch Deposits as may be mutually agreed
in writing by SELLER and BUYER, and (iii) related Accrued Interest Payable on
such Excluded Deposits.
"FDIC" means the Federal Deposit Insurance Corporation.
"Federal Reserve" means the Board of Governors of the Federal Reserve System.
"Fixed Assets" means all furniture, equipment, fixtures, and other tangible
personal property owned by SELLER located in or on the Branch, other than the
assets excluded pursuant to paragraph (b) of Section 3.2, as set forth in
Schedule 4.
"Hazardous Material" means any pollutant, contaminant, or hazardous substance
or hazardous material as defined in or pursuant to the Comprehensive
Environmental Response, Compensation, and Liability Act, 42 U.S.C. Section 9601
et seq. or any other federal, state or local environmental law or regulation.
"Investors" means persons who have entered into Stock Purchase Agreements
calling for the investment in additional Common Stock as provided in Section 4.5
hereof.
"Jumbo Deposit" means a certificate of deposit with an opening balance of more
than one hundred thousand dollars ($100,000).
"Market Area" means the city of Alexandria in the Commonwealth of Virginia.
"Net Book Value" means the value of an asset on the books of SELLER determined
in accordance with Generally Accepted Accounting Principles ("GAAP").
"OTS" means the Office of Thrift Supervision of the United States Department
of the Treasury.
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"Preferred Stock" means the preferred stock to be authorized and issued by
BUYER more particularly described in Exhibit A hereto.
"Preferred Stock Purchase Agreement" means the Agreement in the form of
Exhibit A hereto.
"Purchase Value" means the value determined pursuant to Section 2.1.
"Real Property" means that land, together with all buildings, improvements,
easements and appurtenances, constituting the premises of the Branch, as more
particularly described in Exhibit D hereto.
"Records" means (i) all records and original documents pertaining to the
Assets and (ii) all records and original documents relating to the Branch
Deposits as are segregated and readily available.
"Returned Items" shall have the meaning set forth in Section 13.1.
"Senior Officers of SELLER" shall mean the officers of SELLER at the level of
Vice President or above as listed on Schedule 6.
"Servicing Rights" means the rights to service loans including, without
limitation, any rights to receive compensation with respect to such servicing.
"Stock Purchase Agreements" means the agreements in the form of Exhibit C
hereto.
"Taxpayer Information" shall have the meaning set forth in Section 13.9.
"TIN" means Taxpayer Information Number.
"Warrant and Voting Agreement" means the agreement in the form of Exhibit B
hereto.
"Withholding Obligations" shall have the meaning set forth in Section 13.3.
ARTICLE 2
TERMS OF PURCHASE
2.1 Purchase and Sale of Assets.
(a) Purchase and Sale. At Closing and subject to the terms and
conditions set forth in this Agreement, SELLER shall, as of the close
of business on the Closing Date, sell, convey, assign and transfer to
BUYER and BUYER shall acquire, purchase and accept from SELLER all of
SELLER's right, title and interest in and to the Assets pursuant to
the terms of this Agreement, and the Bill of Sale and Assignment, in
the form attached hereto as Exhibit E.
(b) Purchase Price. In consideration for the Assets acquired by it
under this Agreement, BUYER shall assume at Closing the liabilities of
SELLER as set forth in Section 2.3, and shall pay to SELLER at Closing
an amount computed by totalling the Purchase Values of the Assets.
(c) Purchase Value. The Purchase Value of the Branch Loans shall
equal their unpaid principal balance on the books of SELLER as of the
Closing Date as set forth in Section 3.1 of this Agreement, except as
otherwise agreed by SELLER and BUYER in writing. It is expressly
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understood that such Purchase Value is determined for purposes of
calculating amounts due from the BUYER to the SELLER and, except as
may otherwise be stated explicitly by the parties, does not represent
any agreement between the parties as to the determination of values of
Assets for accounting or tax purposes.
(d) Names and Marks. SELLER will use its reasonable best efforts to
obtain, in connection with the other approvals and consents required
to be obtained by it pursuant to this Agreement, regulatory approvals
and consents necessary for the sale, conveyance, and transfer, to
BUYER of the rights or interest in and to (i) the name "First
Commonwealth Savings Bank" and any combination or derivation thereof,
and (ii) any logos, service marks or trademarks, advertising materials
or slogans or any similar items used before, on or after the Closing
Date by SELLER in connection with its business; and BUYER will
cooperate in such efforts and use its reasonable best efforts to
obtain such regulatory approvals and consents as may be necessary for
it to make full use of such rights and interests in its banking
operations in Virginia, and, subject to the receipt of such approvals
and consents, such rights and interests shall be transferred to BUYER
on the Closing, or if such approvals and consents permitting the
transfer of such intellectual property on the Date of Closing have not
then been received, as soon as reasonably possible after such
approvals and consents have been received on a date mutually agreed
upon by SELLER and BUYER, provided that the Purchase Values of the
Assets shall not be adjusted by virtue of the fact that such rights or
interests are transferred, or are unable to be transferred because
necessary regulatory approvals and consents for such transfer have not
been received, and the transfer of such rights or interests is not a
condition to the obligations of BUYER or BANCORP under this Agreement.
2.2 Purchase and Sale of Real Property and Fixed Assets.
(a) Purchase and Sale. At Closing and subject to the terms and
conditions set forth in this Agreement, SELLER shall sell, convey,
assign and transfer to BANCORP and BANCORP shall acquire, purchase and
accept from SELLER all of SELLER's right, title and interest in and to
the Fixed Assets and the Real Property. Risk of loss on the Assets
will pass to BANCORP at the Closing.
(b) Purchase Price. In consideration for the Fixed Assets and Real
Property acquired by it under this Agreement, BANCORP shall pay to
SELLER at Closing the sum of One Million, Five-Hundred Thousand
Dollars ($1,500,000.00).
2.3 Assumption of Liabilities.
(a) Branch Deposits. On the Closing Date, subject to the terms and
conditions set forth in this Agreement, BUYER shall assume liability
for the payment in full and performance of the SELLER's obligations
accruing on and after the Closing Date for the Branch Deposits
pursuant to the Assignment and Assumption Agreement, in the form
attached hereto as Exhibit F.
(b) Reimbursement for Deposits. At the Closing, SELLER shall
reimburse BUYER for the assumption of the Branch Deposits, as set
forth in Sections 4.2 hereof and subject to adjustment as provided in
Section 4.3 hereof.
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(c) Schedules of Branch Deposits. Schedule 1 to this Agreement
contains a list of all Branch Deposits, identified by account number
and showing the outstanding balance and interest rate payable for each
such account, grouped by type of account, as of March 31, 1996, which
list is subject to change for additions, deletions and modifications
due to normal daily activity in accordance with the terms of this
Agreement. In addition to such reports and information otherwise
required to be provided by SELLER under this Agreement, SELLER will
continue to provide, through the Closing Date, information regarding
the Branch Deposits including such monthly reports on balances,
interest rates and other information as BUYER shall reasonably
request. Two Business Days prior to the Closing Date, SELLER shall
prepare and deliver to BUYER an updated Schedule 1 to this Agreement
with information as of the close of business five (5) Business Days
prior to the Closing Date. Within two (2) Business Days following the
Closing Date, SELLER shall prepare and deliver to BUYER an updated
Schedule 1 to this Agreement which shall contain a list of all Branch
Deposits as of the Closing Date identified by name of depositor, and
account number along with the outstanding balance and interest rate
payable for each identified account.
(d) Related Assets and Obligations. On the Closing Date, BUYER will
assume all obligations of SELLER for contracts or agreements
specifically assigned to BUYER hereunder and to provide services
incidental to the Branch Deposits; provided, however, that BUYER shall
assume such obligations which are not customarily undertaken by
depository institutions in the Commonwealth of Virginia in connection
with Deposits only to the extent such obligations are disclosed by
SELLER on Schedule 2 hereto as of the date hereof.
(e) No Other Debt, Obligations or Liabilities Assumed. It is
expressly understood and agreed that, except as expressly set forth in
this Agreement, along with the Exhibits and Schedules hereto, neither
BUYER nor BANCORP shall assume or be liable for any of the debts,
obligations or liabilities of SELLER of any kind and nature whatsoever
occurring on or before the Closing Date including, but not limited to:
any losses or liabilities due to or arising from forgery, fraud,
defalcation, or any other improper act or omission; any tax or debt
therefor; any liability for unfair labor practices (such as wrongful
termination or employment discrimination); any liability or obligation
of SELLER arising out of any threatened or pending litigation; or any
liability with respect to personal injury or property damage claims.
2.4 Prorations; Sales, Transfer and Income Taxes.
(a) Federal Deposit Insurance. All fees for Federal deposit
insurance assessed with respect to the Branch Deposits pursuant to
Section 7 of the Federal Deposit Insurance Act, 12 U.S.C. (S)1817, as
calculated by SELLER and verified by BUYER, shall be prorated between
the parties as of the Closing Date on the basis of a 365-day year.
Without limiting the foregoing, BUYER shall reimburse SELLER for the
amounts of any such federal deposit insurance premiums assessed for
periods after the Closing Date that were calculated based upon
deposits that were included in Branch Deposits at the Closing Date,
even if such premiums are paid after the Closing Date, provided that
(i) the amount of any such reimbursement shall not exceed the amount
that would have been assessed against BUYER for such deposits at SAIF
rates had it held the Branch Deposits in the amount and of the
composition transferred to BUYER on the Closing Date under this
Agreement at the date used for calculation of assessments against the
SELLER, and (ii) BUYER shall not reimburse SELLER for any such deposit
insurance premiums for any period for which BUYER is assessed deposit
insurance premiums based upon the Branch Deposits.
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(b) Sales, Transfer and Income Taxes. All excise, sales, use,
transfer, and recording taxes and any other taxes or assessments which
are payable or arise as a result of this Agreement or the consummation
of the transfers contemplated hereby (except income taxes determined
by reference to the net income of one of the parties) with respect to
the Fixed Assets and the Real Property shall be prorated between
BANCORP and SELLER as of the Closing Date on the basis of a 365 day
year, and with respect to the Assets and the Branch Deposits shall be
prorated between BUYER and SELLER as of the Closing Date on the basis
of a 365 day year. BUYER or BANCORP, as the case may be, shall pay
such taxes or assessments to the applicable agency and shall notify
SELLER of the amount owed. SELLER shall reimburse BUYER or BANCORP,
as the case may be, for SELLER's portion of any taxes or assessments
within ten (10) calendar days after receiving written notice from
BUYER of the amount due. Sales or income taxes payable by SELLER as a
consequence of the transaction contemplated herein shall be paid
solely by SELLER.
(c) Closing Adjustment. On the Closing Date, SELLER shall pay to
BUYER by wire transfer in immediately available funds, the Closing
Payment as set forth in Section 4.2 hereof. The amount of the Assets
to be acquired, the Branch Deposits to be assumed and all other
prorations to be made shall be set forth on a closing statement to be
prepared as of the dates of the determination of such amounts set
forth herein and executed by the BUYER, SELLER and BANCORP on the
Closing Date. Any items which are required to be prorated hereunder
which cannot be prorated, because of a lack of sufficient information,
by the Closing Date shall be prorated as soon as the requisite
information is available. The post closing adjustments necessitated by
any such proration shall be effected within ten (10) calendar days of
Closing in accordance with Section 4.3 hereof.
ARTICLE 3
TRANSFER OF ASSETS
3.1 Branch Loans.
(a) Loans Eligible to be Branch Loans. Schedule 3 hereto identifies
the loans which are eligible to be Branch Loans as of March 31, 1996,
subject to the rights of BUYER pursuant to this Section 3.1, and
states the unpaid principal balance of each such loan, and the
contractual interest rate applicable to each such loan (without regard
to any discount or deferred interest or cost recognized by SELLER in
accordance with Generally Accepted Accounting Principles or
otherwise). BUYER may (but need not) remove a loan from the Branch
Loans set forth on Schedule 3 only if such loan becomes, prior to the
Closing Date, past due as to interest or principal by sixty (60) days
or more or has been classified by the OTS at its most recent
examination of the SELLER as "special mention", "substandard,"
"doubtful" or "loss," except as listed on Schedule 13. All Branch
Loans will be purchased by BUYER without recourse to SELLER.
(b) Access to Branch Loans. Within thirty (30) calendar days of the
date of this Agreement SELLER will afford to BUYER reasonable access,
subject to Section 7.7 hereof, to the files and records regarding
loans listed on Schedule 3 to this Agreement.
(c) Continuing Due Diligence. In addition to such reports and
information otherwise required to be provided by SELLER under this
Agreement, SELLER will continue to provide, through the Closing Date,
information regarding the Branch Loans including: (i) such monthly
reports on balances, collections, payments, interest rates, past due
status and similar characteristics as BUYER may reasonably request,
and (ii) records reasonably requested by BUYER.
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(d) Amended Schedule of Branch Loans. At least two (2) calendar days
prior to the Closing Date, SELLER will provide to BUYER an update to
Schedule 3 showing the unpaid principal balance of the Branch Loans as
of five (5) Business Days prior to Closing.
3.2 Fixed Assets.
(a) Transfer of Fixed Assets. SELLER agrees to sell, transfer, and
assign to BANCORP all of SELLER's right, title and interest in and to
the Fixed Assets. SELLER shall cause a Bill of Sale of such property
substantially in the form of Exhibit E to be delivered to BANCORP on
the Closing Date. All of the Fixed Assets and all other personal
property to be acquired hereby by BANCORP or BUYER is to be acquired
"as is, where is", and without any representation or warranty by
SELLER as to value, income, suitability, merchantability,
marketability, or fitness for a particular purpose.
(b) Inventory of Fixed Assets. Within thirty (30) calendar days
following the date of this Agreement SELLER shall have delivered to
BANCORP an inventory of the tangible personal property situated at the
Branch which inventory shall (i) identify each item (or group of
related items) of such personal property with reasonable particularity
and describe the ownership thereof, any security interests therein or
other liens thereon, and any leases to which the item is subject, and
(ii) list the net book value (based, when necessary, upon reasonable
allocations of book values by SELLER) of each such asset as of the end
of the calendar month preceding the delivery of the inventory. BANCORP
shall be entitled to conduct a walk-through inspection of the Branch
within thirty (30) calendar days after receipt of the inventory and
again within fifteen (15) calendar days prior to the Closing Date to
inspect such property. At least thirty (30) calendar days prior to
Closing, SELLER will deliver to BANCORP Schedule 4 to this Agreement
which shall contain an inventory of such assets. Any and all forms,
supplies and papers and all items not listed on the inventory required
hereby are excluded from the Fixed Assets.
3.3 Real Property. SELLER agrees to sell, transfer, and assign to BANCORP
all of SELLER's right, title and interest in and to the Real Property, and to
deliver one or more general warranty deeds relating to the Real Property at the
Closing Date.
3.4 Records. At the Closing, SELLER agrees to deliver to BUYER or shall
have delivered to the Branch those books and records identified in Schedule 5 of
this Agreement, unless SELLER delivers such books and records to BUYER before
the Closing Date.
ARTICLE 4
CLOSING
4.1 Closing. The closing of the transactions contemplated by this
Agreement ("Closing") shall take place at such time and place as BANCORP, BUYER,
SELLER and FCFC shall agree on a Friday within fifteen (15) days following the
first date on which both (i) all regulatory approvals and consents required by
this Agreement have been received and (ii) all waiting periods required by law
and regulation in connection with such approvals and consents have expired, or
at such other time and date as the parties may fix, if all of the conditions set
forth in Article 10 have been satisfied or waived on or before such date. The
date the Closing is to be held is herein called the "Closing Date." The Closing
shall be deemed to occur at the close of business on the Closing Date unless
otherwise agreed by the parties.
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4.2 Closing Payment. The amounts owed to SELLER by BUYER pursuant to
Section 2.1 will be deducted from the amounts owed to BUYER by SELLER pursuant
to Section 2.3 and netted with the amount due the appropriate party under
Section 2.4 to determine the closing payment due to BUYER or SELLER from the
other, as appropriate, as of the Closing Date (the "Closing Payment"). Because
the parties acknowledge that certain amounts to be paid may not be finally
determinable until after the Closing Date, the Closing Payment will be paid as
follows:
(a) Amount of Payment. SELLER will pay to BUYER on the Closing Date an
amount equal to the Branch Deposits as shown on Schedule 1 to the
Agreement as of the close of business five (5) Business Days prior to
the Closing Date, minus the sum of (i) the Deposit Premium; (ii) all
Cash; (iii) the Purchase Value of the Branch Loans as shown on
Schedule 3 of the Agreement as of the close of business five (5)
Business Days Prior to the Closing Date; plus or minus, as
appropriate, the net amount due to BUYER or to SELLER, respectively,
on account of the prorations required by Section 2.4 hereof. BANCORP
will pay to SELLER on the Closing Date the sum of One Million, Five-
Hundred Thousand Dollars ($1,500,000.00), plus or minus the amount due
to SELLER or BANCORP, respectively, on account of the prorations
required by Section 2.4 hereof.
(b) Manner of Payment. All payments shall be made by wire transfer of
immediately available funds. Payments due on the Closing Date shall be
received no later than 12:00 noon on the Closing Date. All amounts
received after 12:00 noon on the date on which payment is due shall
accrue interest at a rate equal to the Cost of Funds from the date
payment is due but not including the date of payment; except that any
amounts received after 12:00 noon shall accrue interest for that day.
4.3 Closing Adjustment. The parties shall cooperate in the prompt
determination of such amounts due pursuant to Section 4.2 and within ten (10)
calendar days after the Closing Date shall settle by wire transfer amounts in a
manner consistent with the express terms of this Agreement.
4.4 Dispute Resolution. In the event that the amount of consideration
payable with respect to any Asset purchased or Branch Deposit assumed is not
determinable as of the date the Closing Payment is due, the party hereto
required to pay the consideration in respect thereof shall make a good faith
preliminary estimate of the amount of any such indeterminable consideration and,
based upon such preliminary amounts, a preliminary payment in respect of any
such item shall be made at the time of the Closing Payment. The parties shall
cooperate in the prompt determination of any such amounts and all such amounts
shall be settled by an appropriate adjustment between the parties within thirty
(30) calendar days following the Closing Date. The parties agree to use best
efforts to resolve any disputed amounts by mutual agreement within such thirty
(30) day period. In the event that any dispute shall remain unresolved after the
end of such thirty (30) day period, BANCORP, BUYER and SELLER shall mutually
select an independent third party, such as a consultant, independent accountant,
or appraiser, who shall render a decision on such dispute within sixty (60)
calendar days following the Closing Date. In the event BANCORP, BUYER and SELLER
cannot mutually agree as to the identity of such an independent third party,
BANCORP, BUYER and SELLER shall each select an independent party who in turn
shall select the independent party who is to resolve the dispute. All costs of
any such third party or parties shall be born by the party (that is, BANCORP,
BUYER or SELLER) against whom such independent third party resolves the dispute,
without allocation in any way to the other party.
4.5 Investment by FCFC Group and Investors. At the Closing, (i) the FCFC
Group shall invest the sum of $2.0 Million in return for the Preferred Stock as
provided in the Preferred Stock Purchase Agreement; (ii) the Investors shall
invest (or shall have invested) in an aggregate of at least $2.0 million of
additional Common Stock as provided in the Stock Purchase Agreements; and (iii)
the FCFC Group and Bancorp shall enter into the Warrant and Voting Agreement.
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4.6 Deliveries by SELLER and the FCFC Group. At the Closing, SELLER or
the FCFC Group shall deliver to BUYER or BANCORP the documents as set forth in
Paragraph (g) of Section 10.2.
4.7 Deliveries by BUYER and BANCORP. At the Closing, BANCORP or BUYER
shall deliver to SELLER or FCFC the documents as set forth in Paragraph (d) of
Section 10.1.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF BUYER AND BANCORP
5.1 Representations and Warranties of BUYER. BUYER represents and warrants
to SELLER and FCFC as follows:
(a) Organization and Authority. BUYER is a commercial bank duly
organized, validly existing, and in good standing under the laws of the
State of Maryland and its deposits are insured by the Bank Insurance Fund
("BIF") administered by the FDIC to the maximum extent provided by law and
no action is pending or, to the knowledge of the BUYER, threatened by the
FDIC with respect to the termination of such insurance. BUYER has the
corporate power to carry on its business as it is now being conducted and
to consummate the transactions contemplated by this Agreement. The
execution, delivery and performance by BUYER of this Agreement and
consummation of the transactions contemplated hereby are within BUYER's
corporate power and have been duly authorized by all necessary corporate
action. This Agreement is legally binding and enforceable against BUYER in
accordance with its terms subject to applicable bankruptcy, insolvency,
reorganization, moratorium, laws relating to the conservatorship or
receivership of insured Depository Institutions or similar laws affecting
creditors' rights generally and to general principles of equity, and this
Agreement and the transactions contemplated hereby do not contravene or
constitute a default under or violate any provision of applicable law or
regulation or of BUYER's charter or bylaws or any judgment, injunction,
order, decree, material agreement, or material instrument binding upon
BUYER.
(b) Litigation. There is no action, suit or proceeding pending against
BUYER, or to the knowledge of BUYER threatened against or affecting BUYER,
before any court or arbitrator or any governmental body, agency or official
which could materially and adversely affect the ability of BUYER to perform
its obligations under this Agreement or which in any manner questions the
validity of this Agreement.
(c) Governmental Notices. BUYER has received no notice from any Federal,
State or other governmental agency indicating that such agency would oppose
the transactions contemplated hereby or would not grant or issue its
consent or approval, if required, with respect to the transactions
contemplated hereby.
(d) Other Information. No representation or warranty by the BUYER
contained in this Agreement or disclosure by the BUYER in any certificate
or other instrument or document furnished or to be furnished by or on
behalf of BUYER pursuant to this Agreement for use in applications to
various regulatory authorities, contains or will contain any untrue
statement of a material fact or omits or will omit to state any material
fact which is necessary to make the statements contained herein or therein,
in light of the circumstances under which they were made, not misleading in
any material respect.
(e) Community Reinvestment Act. The most recent rating from the FDIC
received by the BUYER under the Community Reinvestment Act was not less
than "satisfactory."
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(f) Regulatory Capital and Condition. The BUYER is in compliance with
all applicable capital standards as of the date hereof and except as
otherwise disclosed in this Agreement, has no reason to believe that it
will be unable to obtain the required regulatory approvals for the
transactions contemplated herein solely as a result of its current level of
regulatory capital, provided the investments by FCFC and the Investors
contemplated herein are made. As of the date hereof, there are no pending
or to the best of the BUYER's knowledge, threatened legal or governmental
proceedings against the BUYER or any affiliate of the BUYER that would
affect the BUYER's ability to obtain the required regulatory approvals or
to satisfy any of the other conditions required to be satisfied in order to
consummate the transactions contemplated hereby.
5.2 Representations and Warranties of BANCORP. BANCORP represents and
warrants to SELLER and FCFC as follows:
(a) Organization and Authority. BANCORP is a corporation duly organized,
validly existing, and in good standing under the laws of the State of
Maryland and is a registered bank holding company under the Bank Holding
Company Act. BANCORP has the corporate power to carry on its business as
it is now being conducted and to consummate the transactions contemplated
by this Agreement. The execution, delivery and performance by BANCORP of
this Agreement and consummation of the transactions contemplated hereby are
within BANCORP's corporate power and have been duly authorized by all
necessary corporate action. The Agreement is legally binding and
enforceable against BANCORP in accordance with its terms subject to
applicable bankruptcy, insolvency, reorganization, moratorium, or similar
laws affecting creditors' rights generally, and to general principles of
equity, and this Agreement and the transactions contemplated hereby do not
contravene or constitute a default under or violate any provision of
applicable law or regulation or of BANCORP's charter or bylaws or any
judgment, injunction, order, decree, material agreement, or material
instrument binding upon BANCORP.
(b) Litigation. There is no action, suit or proceeding pending against
BANCORP, or to the knowledge of BANCORP threatened against or affecting
BANCORP, before any court or arbitrator or any governmental body, agency or
official which could materially and adversely affect the ability of BANCORP
to perform its obligations under this Agreement or which in any manner
questions the validity of this Agreement.
(c) Governmental Notices. BANCORP has received no notice from any
Federal, State or other governmental agency indicating that such agency
would oppose the transactions contemplated hereby or would not grant or
issue its consent or approval, if required, with respect to the
transactions contemplated hereby.
(d) Information for Regulatory Applications. No representation or
warranty by BANCORP contained in this Agreement or disclosure by BANCORP in
any certificate or other instrument or document furnished or to be
furnished by or on behalf of BANCORP pursuant to this Agreement for use in
applications to various regulatory authorities, contains or will contain
any untrue statement of a material fact or omits or will omit to state any
material fact which is necessary to make the statements contained herein or
therein, in light of the circumstances under which they were made, not
misleading in any material respect.
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ARTICLE 6
REPRESENTATIONS AND WARRANTIES OF SELLER AND FCFC
6.1 Representations and Warranties of SELLER. SELLER represents and
warrants to BUYER and BANCORP as follows:
(a) Organization and Authority. SELLER is a federal savings bank duly
organized, validly existing and in good standing under the laws of the
United States and its deposits are insured by the Savings Association
Insurance Fund ("SAIF") administered by the FDIC to the maximum extent
provided by law and no action is pending, or to the knowledge of the
SELLER, threatened by the FDIC with respect to the termination of such
insurance. SELLER has the corporate power to carry on its business as it
is now being conducted and to consummate the transactions contemplated by
this Agreement. The execution, delivery and, except as set forth in
Schedule 11 hereto, performance by SELLER of this Agreement and
consummation of the transactions contemplated hereby are within SELLER's
corporate power and have been duly authorized by all necessary corporate
action. The Agreement is legally binding and enforceable against SELLER in
accordance with its terms subject to applicable bankruptcy, insolvency,
reorganization, moratorium, laws relating to the conservatorship or
receivership of insured Depository Institutions or similar laws affecting
creditors' rights generally and to general principles of equity, and do not
contravene or constitute a default or violation under any provision of
applicable law or regulation or of SELLER's charter or bylaws or, except as
set forth in Schedule 11, any judgment, injunction, order, decree, material
agreement, or material instrument binding upon SELLER or to which any of
the Assets or Branch Deposits to be transferred hereby are subject and will
not result in the creation or imposition of any lien or Encumbrance on such
Assets or Deposits.
(b) Compliance with Law. SELLER holds all licenses, franchises, permits
and authorizations necessary for the lawful conduct of its business at the
Branch Office except for those licenses, franchises, permits or
authorizations, the lack of which would not have a material adverse effect
on the operations of the Branch, and, to the best of its knowledge and
belief, is not in any material violation of any applicable statutes, laws,
ordinances, rules or regulations of any Federal, State, or local
governmental bodies, agencies or subdivisions with regard to the Branch
Office having jurisdiction over it or over any part of its operations and,
without limitation, to the knowledge of the Senior Officers of the SELLER,
has not violated any State or Federal environmental laws or regulations or
other laws or regulations governing hazardous or toxic materials in
connection with its occupancy or operation of the Branch.
(c) Environmental Matters.
(i) To the knowledge of the Senior Officers of SELLER, except as
described on Schedule 9 hereto, SELLER has received no written
notice of any suit, claim, action or proceeding pending or
threatened, or before any governmental entity or court of
competent jurisdiction in which the Real Property or the Fixed
Assets has been, or with respect to threatened proceedings, may
be, named as a defendant (i) for alleged noncompliance (including
by any corporate predecessor) with any environmental law, rule,
regulation, standard or requirement or (ii) relating to the
release into or presence in the environment of any Hazardous
Material; and, to the knowledge of the Senior Officers of the
SELLER, there is no reasonable basis for any such suit, claim,
action or proceeding.
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(ii) To the knowledge of the Senior Officers of the SELLER (without
engaging any environmental consultant to conduct any
environmental assessment for the purposes hereof) except as
described on Schedule 9 hereto, there has been no release of any
Hazardous Material in, on, under or affecting the Real Property,
or, to the actual knowledge of the Senior Officers of SELLER,
collateral for any Branch Loan, and there are no underground
storage tanks in, on, under or affecting the Real Property.
(d) Litigation and Encumbrances. Except as set forth in Schedule 11,
there is no action, suit or proceeding pending against SELLER, or to the
knowledge of SELLER threatened against or affecting SELLER, before any
court or arbitrator or any governmental body, agency or official which
could materially and adversely affect the aggregate value of the Branch
Deposits or the Assets or the ability of SELLER to perform its obligations
under this Agreement. None of the Branch Deposits or Assets SELLER is
transferring hereby is subject to any third party Encumbrances which will
not be released on or prior to the Closing Date, or any legal restraint or
other legal process, other than customary court orders, levies, and
garnishments affecting the owners of the Deposits.
(e) Governmental Notices. SELLER has received no notice from any
Federal, State or other governmental agency indicating that such agency
would oppose the transactions contemplated hereby or would not grant or
issue its consent or approval, if required, with respect to the
transactions contemplated hereby.
(e) Taxes. All payroll, withholding, property, excise, sales, use and
transfer taxes imposed by the United States or by any state, municipality,
subdivision or instrumentality of the United States or by any other taxing
authority which are due and payable by SELLER prior to the Closing relating
to the Assets or the Branch Deposits as of the Closing Date have been paid
in full, or will be so paid prior to the Closing.
(f) Records and Documents. The Records to be delivered to BUYER are and
shall be sufficient to enable BUYER to determine the ownership and balances
of the Branch Deposits and the Branch Loans and include such information
that SELLER reasonably believes to be sufficient for SELLER to conduct a
proper banking business with respect to the Branch Deposits and the Branch
Loans, assuming the transactions contemplated by this Agreement were not
effected. Without limitation, the collateral documents, evidence of
security interests, notes, and other loan documentation of all types
relating to the Branch Loans are, to the actual knowledge of the Senior
Officers of SELLER, sufficient to enforce such loans against the obligors
and guarantors thereof in accordance with the terms of such loans subject
to bankruptcy, insolvency, reorganization, moratorium or other similar laws
now or hereafter in effect relating to creditors' rights generally and that
the remedy of specific performance and injunctive relief or other forms of
equitable relief may be subject to equitable defenses and to the discretion
of the court before which any proceedings therefor may be brought.
(g) Information for Regulatory Applications. The information furnished or
to be furnished by SELLER to BUYER and BANCORP pursuant to Section 8.1 of
this Agreement for the purpose of enabling BUYER and BANCORP to complete
and file applications with any regulatory body is or will be true and
complete in all material respects as of the date so furnished.
(h) TIN Certification. SELLER has complied in all material respects with
all applicable laws in obtaining the Branch Deposits, including the use of
due diligence relating to TIN compliance with respect to holders of the
Branch Deposits.
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(i) Deposit Relationships. The depositors of the Branch Deposits are not
also the record owners of deposits that SELLER has transferred, or intends
to transfer, to any other depository institution. None of the Branch
Deposits serve as compensating balances or collateral for loans other than
Branch Loans or are related to overdraft lines not included in Branch
Loans,
(j) Branch Loan Balances and Rates. Schedule 3 hereto identifies the loans
which are eligible to be Branch Loans as of March 31, 1996, and states the
unpaid principal balance of each such loan and the contractual interest
rate applicable to each such loan, without regard to any discount or
deferred interest or cost recognized by SELLER in accordance with Generally
Accepted Accounting Principles or otherwise.
6.2 Representations and Warranties of FCFC. FCFC represents and warrants
to BUYER and BANCORP as follows:
(a) Organization and Authority. FCFC is a corporation duly organized,
validly existing, and in good standing under the laws of the Commonwealth
of Virginia and is a registered savings and loan holding company. FCFC has
the corporate power to carry on its business as it is now being conducted
and to consummate the transactions contemplated by this Agreement. The
execution, delivery and performance by FCFC of this Agreement and
consummation of the transactions contemplated hereby are within FCFC's
corporate power and have been duly authorized by all necessary corporate
action. The Agreement is legally binding and enforceable against FCFC in
accordance with its terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium, laws affecting creditors' rights generally and
to general principles of equity, and this Agreement and the transactions
contemplated hereby do not contravene or constitute a default under or
violate any provision of applicable law or regulation or of FCFC's articles
of incorporation or bylaws or any judgment, injunction, order, decree,
material agreement, or material instrument binding upon FCFC, except as set
forth in Schedule 12.
(b) Litigation. Except as set forth in Schedule 12, there is no action,
suit or proceeding pending against FCFC, or to the knowledge of FCFC
threatened against or affecting FCFC, before any court or arbitrator or any
governmental body, agency or official which could materially and adversely
affect the ability of FCFC to perform its obligations under this Agreement
or which in any manner questions the validity of this Agreement.
(c) Governmental Notices. FCFC has received no notice from any Federal,
State or other governmental agency indicating that such agency would oppose
the transactions contemplated hereby or would not grant or issue its
consent or approval, if required, with respect to the transactions
contemplated hereby.
(d) Information for Regulatory Applications. No representation or
warranty by FCFC contained in this Agreement or disclosure by FCFC in any
certificate or other instrument or document furnished or to be furnished by
or on behalf of FCFC for use in applications to various regulatory
authorities, contains or will contain any untrue statement of a material
fact or omits or will omit to state any material fact which is necessary to
make the statements contained herein or therein, in light of the
circumstances under which they were made, not misleading in any material
respect.
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ARTICLE 7
COVENANTS OF BUYER AND BANCORP
7.1 Assistance in Obtaining Regulatory Approvals. BUYER and BANCORP
shall be responsible for the preparation and filing of the applications and
notices to the FDIC, the State of Maryland, the Commonwealth of Virginia, and
the Federal Reserve for approval of the transactions described in this
Agreement, including, without limitation, approvals for the authorization and
issuance of the Common Stock and the Preferred Stock and the treatment of such
securities as Tier 1 regulatory capital by BANCORP and the BANK, respectively,
for purposes of the capital standards of the Federal Reserve and the FDIC,
respectively. BUYER and BANCORP will fully cooperate with SELLER in providing
all necessary information, completed forms, and executed documents as may be
required to complete any applications and notices SELLER is required to submit.
The application fees and the costs of any applications or notices required to be
filed by BUYER under this Agreement shall be borne by BUYER. BUYER and BANCORP
each will use its best efforts to file the applications to the FDIC, the State
of Maryland, the Commonwealth of Virginia, and the Federal Reserve required to
be filed by BUYER and BANCORP under this Agreement within thirty (30) calendar
days after the date of this Agreement.
7.2 Fiduciary Relationships. BUYER agrees to assume all of the
fiduciary relationships of SELLER arising out of any IRA and Keogh deposits
assumed by BUYER pursuant to Section 2.3 hereof, to the same extent as if BUYER
had originally acquired, incurred or entered into such fiduciary relationships.
Notwithstanding anything in this Agreement to the contrary, however, BUYER will
not assume or be responsible for any act or failure to act of SELLER in
connection with such IRA or Keogh deposits prior to the Closing Date.
7.3 Performance of Liabilities. Subject to the provision of Article 13
hereof, BUYER agrees to honor all checks, drafts, and non-negotiable withdrawal
orders on forms previously honored by SELLER with respect to the Branch Deposits
to the same extent as if the checks, drafts, or orders were drawn on forms
honored by BUYER with respect to similar deposits or accounts following the
Closing Date, and shall hold SELLER harmless with respect to any wrongful
dishonor by BUYER thereof, and agrees to honor all previously authorized ACH
transfers with respect to the Branch Deposits to the same extent as if the ACH
transfer were made with respect to similar deposits or accounts at BUYER
following the Closing Date, and shall hold SELLER harmless with respect to any
wrongful dishonor by BUYER thereof.
7.4 Further Assurances. On and after the Closing Date, BUYER shall give
such further assurances to SELLER and upon SELLER's request shall execute,
acknowledge and deliver all such acknowledgments and other instruments and take
such further action as may be necessary and appropriate to effectively relieve
and discharge SELLER from any obligations remaining under the Branch Deposits or
the Branch Loans; provided, however, that BUYER need not incur any material
costs or expenses in connection with the undertakings contained in this sentence
unless SELLER agrees to bear such costs or expenses.
7.5 Governmental Consents. BUYER and BANCORP each has or will obtain
prior to the Closing Date all consents, approvals or authorizations of all
governmental authorities or agencies required for the execution, delivery and
performance by BUYER and BANCORP, respectively, of this Agreement and the
consummation by it of any transactions contemplated hereby.
7.6 Other Consents. BUYER and BANCORP each shall secure all necessary
corporate consents and all consents and releases required of third parties
required for the execution, delivery and performance by BUYER and Bancorp,
respectively, of this Agreement and the consummation by it of any transactions
contemplated hereby (except governmental consents and those involving SELLER)
and shall comply with all applicable laws, regulations and rulings in connection
with this Agreement and the consummation of the transactions contemplated
hereby.
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7.7 Confidential Information. Until the Closing, and if for any reason
the Closing is not consummated, at all times thereafter, each of BUYER and
BANCORP and its respective agents and authorized representatives will keep
confidential all non-public information obtained as a result of such access and
will make all reasonable efforts to return to SELLER all original materials
belonging to SELLER and all copies thereof. In the event that BUYER becomes
legally compelled to disclose any of the confidential information furnished to
it by the SELLER pursuant to applicable law or regulation or by legal process,
the BUYER, except to the extent prohibited by law, will provide the SELLER with
prompt notice in order that the SELLER may seek a protective order or other
appropriate remedy and/or waive compliance with the provisions of this
Agreement, which waiver shall not be unreasonably withheld. In the event that
such protective order or other remedy is not obtained, or that the SELLER waives
compliance with provision of this Agreement, the BUYER will furnish only that
portion of the confidential information that is legally required based on a
written opinion of counsel to that effect and the BUYER will exercise reasonable
efforts to obtain reliable assurance that confidential treatment will be
accorded the confidential information. In addition, if the Closing is not
consummated, neither BUYER nor BANCORP will make use of any non-public
information for any purpose other than as disclosed herein, including, but not
limited to, any solicitation of business or in any other way harmful to SELLER.
ARTICLE 8
COVENANTS OF SELLER
8.1 Assistance in Obtaining Regulatory Approvals. SELLER shall be
responsible for the preparation and filing of any applications and notices to
the federal or state authorities for approval of the transfer of Assets and
Branch Deposits to BUYER and the transfer of the Real Property and Fixed Assets
to BANCORP as described in this Agreement, other than the applications or
notices required to be prepared and filed by BUYER or BANCORP under this
Agreement. SELLER will fully cooperate with BUYER and BANCORP in providing all
necessary information, completed forms, and executed documents as may be
required to complete any applications BUYER or BANCORP is required to submit.
The application fees and the costs of any applications or notices required to be
filed by SELLER under this Agreement shall be borne by SELLER. SELLER will use
its best efforts to file the applications and notices to state or federal
authorities required to be filed by SELLER under this Agreement within thirty
(30) business days of the date of this Agreement.
8.2 Access to the Branch Records and Information; Personnel; Customers.
(a) Access to Assets. Between the date of this Agreement and the
Closing Date, subject to Section 7.7 hereof, SELLER shall afford to
BUYER and its authorized agents and representatives access upon
reasonable notice, during normal business hours, or such other times
as may be mutually agreed by BUYER and SELLER, to the Branch and to
the books, records, contracts, documents and other information of or
relating to the Branch Deposits, the Branch Loans and the other
Assets. SELLER shall cause its personnel to provide assistance to
BUYER in BUYER's investigation of matters relating to the Branch
Deposits, the Branch Loans and the other Assets, provided, however,
that BUYER's investigation shall be conducted in a manner which does
not unreasonably interfere with SELLER's normal operations, customers
and employee relations.
(b) Communication with Customers. Following the receipt of the
required federal and state regulatory approvals for the transaction,
without regard to any waiting periods, BUYER, with SELLER's prior
written consent (which shall not be unreasonably withheld), may, at
its own expense, from time to time communicate with, and deliver
information to owners of the Branch Deposits concerning the
transactions contemplated by this Agreement and concerning the
business and operations of BUYER. SELLER, if so requested by BUYER,
shall provide tapes of addresses and other information to BUYER
sufficient to allow BUYER to send such information to such customers.
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8.3 Conduct of Business Pending Closing. Except as may be required to
obtain the regulatory approvals contemplated hereby, between the date of this
Agreement and the Closing Date, and except as may be otherwise required by a
regulatory authority, SELLER shall not, without the prior consent of BUYER,
which consent shall not be unreasonably withheld:
(a) Operations of Branch. Operate the Branch Office other than in the
ordinary course of business or cause the Branch Office to engage or
participate in any material transaction or incur or sustain any
material obligation that would adversely affect the Branch Deposits or
Assets, or take any action which would materially adversely affect
BUYER's rights hereunder to the Assets and the Branch Deposits or
BANCORP's rights hereunder with respect to the Fixed Assets and the
Real Property;
(b) Rates and Terms on Deposits. Offer rates on "non-telemarketing'
Deposits at the Branch Office that exceed prevailing rates offered by
BUYER, unless BUYER agrees to a special rate promotion at the Branch
Office, or accept any Jumbo Deposits of depositors residing outside
the Market Area except for transfer to one or more depository
institutions other than BUYER as "telemarketing deposits" or Brokered
Deposits.
(c) Transfer of Operations. Cause the Branch Office to transfer any
Branch Loans;
(d) Transfer of Branch Deposits. Cause the Branch Office to transfer
to SELLER's other operations any Branch Deposits (it being understood
that any trust accounts and other fiduciary accounts, other than IRA
or Keogh accounts as described in Section 7.2, are not included in
such prohibition against transfer), except upon the unsolicited
request of a depositor in the ordinary course of business;
(e) Transfer of Contracts, Assets, etc. Transfer, assign, encumber
or otherwise dispose of or enter into any contract, agreement or
understanding to transfer, assign, encumber or otherwise dispose of
any of the Assets except in the ordinary course of Branch Office
business;
(f) New Commitments or Agreements. Enter into any commitment,
agreement, understanding or other arrangement to transfer any of the
Branch Deposits or the Assets other than pursuant to the terms of this
Agreement; or
(g) Employee Salary, Benefit or Title Changes. Except for the
compensation of the President and the Senior Vice President of SELLER,
increase the salary or other compensation of any Employee, change the
title of any Employee, or, except to the extent generally applicable
to employees of SELLER, alter the benefits paid to any Employee or to
which any Employee is entitled.
8.4 No Encumbrances. Between the date of this Agreement and the Closing
Date, SELLER will not intentionally create or suffer to exist any new material
Encumbrance on any of the Assets, Fixed Assets , or Real Property, or otherwise
enter into any material transaction or make any material commitment relating to
any of the Assets, Fixed Asset, or Real Property without the prior written
consent of BUYER except as permitted by Section 8.3 hereof.
8.5 Governmental Consents. SELLER has or will obtain prior to the Closing
Date all consents, approvals or authorizations of all governmental authorities
or agencies required for the execution, delivery and performance by SELLER of
this Agreement and the consummation by it of any transactions contemplated
hereby.
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8.6 Other Consents. SELLER shall secure all necessary corporate
consents and all consents and releases required of third parties (except
governmental consents and those involving BUYER) required for the execution,
delivery and performance by SELLER of this Agreement and the consummation by it
of any transactions contemplated hereby, and shall comply with all applicable
laws, regulations and rulings in connection with this Agreement and the
consummation of the transactions contemplated hereby.
8.7 Maintenance of Accounts. SELLER shall use its reasonable best
efforts, consistent with its other obligations pursuant to this Agreement, to
retain at the Branch Office the Branch Deposits.
8.8 Books and Records. SELLER shall retain all books and records
relating to Branch Deposits and the Assets prior to the Closing Date which are
not delivered to BUYER, for a period which is at least the longer of the period
required by law or the normal retention period under SELLER's records management
program unless the parties shall, applicable law permitting, agree upon a
shorter period. The books and records directly relating to Branch Office
operations, assets and liabilities prior to the Closing Date which are retained
by one party shall be open, upon reasonable notice to the other party, for
inspection by the other party and its authorized agents, representatives and
regulators during regular business hours after the Closing Date and the party
with the right of inspection may, at its own expense, make such copies of and
excerpts from such books and records as it may deem desirable. Should one
party's audit or inspection of records in another party's possession result in
the second party's employees or agents having to devote any substantial amount
of time or such party having to allocate facilities or equipment or having to
incur any substantial costs, then the second party shall be entitled to
reasonable reimbursement for all such costs incurred.
8.9 Signs. SELLER, at its own expense, will remove all of its identifying
signs relating to the Branch Office (including, without limitation, signs
advertising, listing, or referring to SELLER, SELLER's products or services, or
any logo or service mark associated with SELLER in the city of Alexandria)
before the close of the first Business Day following the Closing Date, except as
requested in writing by BUYER prior to the Closing Date.
8.10 Clean Branch. Before the first business day following the Closing
Date SELLER will have removed, at its own expense and in a manner which does not
unreasonably interfere with BUYER's rights to possess and operate the Branch
hereunder, all of its property not purchased or leased by BUYER hereunder,
including, without limitation, any and all trash and unused forms, supplies, and
office equipment not purchased by BUYER hereunder, or, with respect to leased
property, not transferred to BUYER hereunder, except as otherwise agreed by the
parties.
8.11 Indemnification for Special SAIF Assessment. SELLER, or in the event
of a liquidation of SELLER, FCFC, will indemnify BUYER and hold it harmless for
any and all special deposit insurance assessments or similar charges or
assessments (and excluding regular deposit premiums) charged or assessed to
BUYER, and actually paid by BUYER (net of federal and state income tax benefits
to or expenses of BUYER applicable to the amount of such indemnified SAIF
assessment and such indemnification payment) related solely to the
recapitalization of the Savings Association Insurance Fund or successor
insurance fund ("SAIF Assessments") assessed upon the Branch Deposits (based
upon the amount and composition of Branch Deposits as of Closing, without any
increase or decrease, regardless of the date of assessment), to the extent such
SAIF Assessment is not generally assessable upon deposits insured under the Bank
Insurance Fund held by banks. Payments due from SELLER, or in the event of
liquidation of SELLER, from FCFC, to BUYER pursuant to this Section shall be
made by wire transfer in immediately available funds, without interest, on or
before 2:00 p.m. upon the date the SAIF Assessment is payable to the federal
deposit insurance fund or United States Treasury. Late payments shall bear
interest at the Cost of Funds from the date payment is due but not including the
date of payment. BUYER hereby consents to the transfer of SELLER's obligation
under this Section 8.11 to FCFC in the event of liquidation of SELLER, and, in
such event, hereafter releases SELLER from its obligations of this Section 8.11
upon such liquidation.
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8.12 Further Assurances. On and after the Closing Date, SELLER and FCFC
shall (i) give such further assistance to BUYER and BANCORP and shall execute,
acknowledge and deliver all such bills of sale, deeds, acknowledgments and other
instruments and take such further action as may be necessary and appropriate
effectively to vest in BUYER and BANCORP full, legal and equitable title to the
Assets, Fixed Assets and Real Property as provided herein, and (ii) use its best
efforts to assist BUYER in the orderly transition of the operations being
acquired by BUYER; provided, however, that neither SELLER nor FCFC need incur
any material costs or expenses in connection with the undertakings contained in
this sentence unless such costs or expenses are paid by BUYER or BANCORP.
ARTICLE 9
COVENANT NOT TO COMPETE
9.1 Non-Compete Period and Geographic Area. For a period of two (2)
years following the Closing Date, SELLER shall not, without the prior written
consent of BUYER, establish, by purchase or otherwise in any fashion, an ATM,
branch, or other lending or deposit-taking office or facility within the Market
Area.
9.2 Solicitation. Following the Closing Date, SELLER shall not directly
solicit individuals whose accounts have been transferred to BUYER pursuant to
this Agreement other than through advertising which does not specifically target
the customers of the Branch.
ARTICLE 10
CONDITIONS TO CLOSING
10.1 Conditions to the Obligations of SELLER and FCFC. Unless waived in
writing by SELLER and FCFC, the obligations of SELLER and FCFC to consummate the
transactions contemplated by this Agreement are subject to the satisfaction of
the following conditions at or prior to the Closing.
(a) Performance. Each of the acts and undertakings of BUYER and of
BANCORP to be performed at or before the Closing pursuant to this
Agreement shall have been duly performed in all material respects.
(b) Representations and Warranties. The representations and
warranties of BUYER and BANCORP contained in Article 5 of this
Agreement shall be true and complete in all material respects on and
as of the Closing Date with the same effect as though made on and as
of the Closing Date.
(c) Regulatory Approvals and Actions. All required licenses,
approvals and consents of any relevant State, Federal or other
regulatory agencies shall have been obtained without the imposition of
any condition or requirement which materially and adversely affects
the interests of SELLER or FCFC in the contemplated transactions, and
all necessary conditions of those licenses, approvals and consents
shall have been fully satisfied (including, without limitation, any
applicable waiting periods).
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(d) Documents. SELLER and FCFC shall have received the following
documents from BUYER and BANCORP:
(1) Resolutions of BUYER's Board of Directors, certified by the
Secretary of BUYER, authorizing the execution and delivery of
this Agreement and the consummation of the transactions
contemplated hereby;
(2) Certificates of the Secretary of BUYER as to the incumbency
and signatures of officers;
(3) Certificates signed by duly authorized officers of BUYER
stating that the conditions set forth in Section 10.1(a) and (b)
have been fulfilled or waived;
(4) Resolutions of BANCORP's Board of Directors, certified by
the Secretary of BANCORP, authorizing the execution and delivery
of this Agreement and the consummation of the transactions
contemplated hereby;
(5) Certificates of the Secretary of BANCORP as to the
incumbency and signatures of officers;
(6) Certificates signed by duly authorized officers of BANCORP
stating that the conditions set forth in Section 10.1(a) and (b)
have been fulfilled or waived;
(7) Opinions of legal counsel for BANCORP and BUYER
substantially in the form of Exhibits H and I hereto;
(8) The Warrant and Voting Agreement executed by Bancorp; and
(9) Such other documents or instruments as SELLER or FCFC may
reasonably request, including, but not limited to, an executed
Assignment and Assumption Agreement in the form of Exhibit F,
relating to BUYER's assumption of the Branch Deposits, and an
executed Assignment, transfer and Appointment of Successor
Trustee for IRA and Keogh accounts, in the form of Exhibit G, and
stock certificates in the name of FCFC Group for shares of the
Preferred Stock.
(e) Absence of Proceedings and Litigation. Except as set forth in
Schedule 11, no order shall have been entered and remain in force at
the Closing Date restraining or prohibiting any of the transactions
contemplated by this Agreement in any legal, administrative or other
proceeding and no action or proceeding shall have been instituted or
threatened on or before the Closing Date pertaining to the
transactions contemplated by this Agreement which, in the reasonable
judgement of SELLER and FCFC, would have, upon consummation of the
transactions contemplated by this Agreement, a materially adverse
effect upon SELLER or FCFC.
(f) Authorization of Preferred Stock. BUYER shall have amended its
Articles of Incorporation to authorize the Preferred Stock.
10.2 Conditions to the Obligations of BUYER and BANCORP. Unless waived in
writing by BUYER and BANCORP, the obligations of BUYER and BANCORP to consummate
the transactions contemplated by this Agreement are subject to the satisfaction
of the following conditions at or prior to the Closing.
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(a) Performance. Each of the acts and undertakings of SELLER and
FCFC to be performed at or before the Closing pursuant to this
Agreement shall have been duly performed in all material respects.
(b) Representations and Warranties. The representations and
warranties of SELLER and FCFC contained in this Agreement shall be
true and complete in all material respects on and as of the Closing
Date with the same effect as though made on and as of the Closing
Date.
(c) Access to Information. SELLER shall have permitted BUYER,
BANCORP and their authorized representatives and agents to have
reasonable access, after the date of this Agreement, to all such
properties, assets and records of SELLER related to the Branch Loans,
the other Assets, the Fixed Asset, the Real Property and the Branch
Deposits.
(d) Absence of Proceedings and Litigation. No order shall have been
entered and remain in force at the Closing Date restraining or
prohibiting any of the transactions contemplated by this Agreement in
any legal, administrative or other proceeding and no action or
proceeding shall have been instituted or threatened on or before the
Closing Date pertaining to the transactions contemplated by this
Agreement which, in the reasonable judgement of BUYER and BANCORP,
would have, upon the consummation of the transactions contemplated by
this Agreement, a materially adverse effect upon BUYER or BANCORP.
(e) Regulatory Approval. All required licenses, approvals and
consents of any relevant State, Federal or other regulatory agencies
shall have been obtained without the imposition of any condition or
requirement which materially and adversely affects the interests of
BUYER or BANCORP in the contemplated transactions, and all necessary
conditions of those licenses, approvals and consents shall have been
fully satisfied with respect to the transactions contemplated by this
Agreement (including, without limitation, any applicable waiting
periods).
(f) No Material Adverse Change. No material adverse change shall
have occurred in the deposit composition, amounts, maturities, or
interest rates of the Branch Deposits.
(g) Documents. BUYER or BANCORP shall have received the following
documents from SELLER or FCFC:
(1) A Bill of Sale and Assignment substantially in the form of
Exhibit E hereto;
(b) One or more general warranty deeds as required by Section
3.3 of this Agreement.
(2) Such other bills of sale, assignments, and other instruments
and documents as counsel for BUYER or BANCORP may reasonably
require as necessary or desirable for transferring, assigning and
conveying to BUYER or BANCORP good and marketable title to the
Assets to be transferred to BUYER and the Fixed Assets and Real
Property to be transferred to BANCORP pursuant to this Agreement,
all in form and substance reasonably satisfactory to counsel for
BUYER and BANCORP;
(3) Resolutions of SELLER's and FCFC's Boards of Directors,
certified by its Secretary, President, Chief Executive Officer or
Chief Operating Officer, authorizing the signing and delivery of
this Agreement and the consummation of the transactions
contemplated hereby;
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(4) A certificate from the Secretary of SELLER and the
Secretary, President, Chief Executive Officer or Chief Operating
Officer of FCFC as to the incumbency and signatures of officers;
(5) A certificate signed by duly authorized officers of SELLER
and FCFC stating that the conditions set forth in Section 10.2(a)
and (b) have been fulfilled or waived;
(6) An opinion of legal counsel for SELLER and FCFC
substantially in the form of Exhibits J and K hereto;
(7) An IRA and Keogh Assignment, Transfer and Appointment of
Successor Trustee executed by SELLER substantially in the form of
Exhibit G; and
(8) Such other documents or instruments as BUYER may reasonably
request, including, but not limited to, an executed Assignment
and Assumption Agreement in the form of Exhibit F, relating to
BUYER's assumption of the Branch Deposits.
(9) A certificate signed by a duly authorized officer of FCFC
stating that the condition set forth in Section 10.2(j) has been
fulfilled;
(h) Investment by SELLER. The FCFC Group shall have executed and delivered
the Preferred Stock Purchase Agreement in the form of Exhibit A hereto and
shall have tendered payment for the Preferred Stock in accordance with the
terms thereof, and shall have executed and delivered the Warrant and Voting
Agreement in the form of Exhibit B hereto.
(i) Investment by the Investors. Investors shall have entered one or more
Stock Purchase Agreements for the purchase of Common Stock for aggregate
cash proceeds of at least $2.0 Million at a per share price of at least
$3.00 per share upon Closing and shall have purchased such shares or shall
have tendered payment for such shares to be made upon Closing.
(j) FCFC Minimum Net Worth. FCFC shall have a net worth as determined under
Generally Accepted Accounting Principles of at least $3,000,000.
ARTICLE 11
TERMINATION
11.1 Conditions for Termination. This Agreement shall terminate and be of
no further force or effect as between the parties, except as to liability for
breach of any duty or obligation arising prior to the date of termination, upon
the occurrence of any of the following:
(a) The expiration of thirty (30) calendar days after the Federal
Reserve, the Department of Banking of the State of Maryland, the
Commissioner of Banking of the Commonwealth of Virginia, the FDIC, the
OTS, or any other governmental agency shall have denied or refused to
grant the approvals or consents required to be obtained pursuant to
this Agreement, unless within said thirty (30) day period BUYER and
SELLER agree to submit or resubmit an application to, or appeal the
decision of, the regulatory authority which denied or refused to grant
approval thereof;
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(b) Upon the failure to consummate the transaction on or before
September 1, 1996, unless such date is extended in writing agreed to
by the parties;
(c) In the sole discretion of BUYER, upon any receivership,
conservatorship, or seizure of SELLER by any regulator having
authority over SELLER;
(d) In the sole discretion of SELLER, upon any receivership,
conservatorship, or seizure of BUYER by any regulator having authority
over BUYER;
(e) By SELLER, FCFC, BUYER or BANCORP (provided the terminating party
shall not be in material breach of any representation, warranty,
covenant or other agreement contained herein) if there shall have been
a material breach on the part of the other party of any of the
representations or warranties set forth in this Agreement as of the
date of this Agreement, or of covenants or agreements set forth in
this Agreement, which breach is not cured within thirty days following
written notice to the party committing such breach, or which breach,
by its nature, cannot be cured prior to the Closing.
(f) Upon written mutual consent of the parties to terminate.
Notwithstanding anything to the contrary contained in this Agreement, no
party hereto shall have the right to terminate this Agreement on account of its
own breach, a breach by its Affiliate, or any immaterial breach by the another
party.
11.2 Effect of Termination.
(a) No termination of this Agreement pursuant to this Article 11 or
for any reason or in any manner shall release, or be construed to
release, any party hereto from liability or damage to any other party
arising out of, in connection with, or otherwise relating to, directly
or indirectly, such party's willful breach of any provision of this
Agreement except as expressly provided in this Section 11.2.
(b) As a condition of SELLER's willingness, and in order to induce
SELLER, to enter into this Agreement and to reimburse SELLER for
incurring the cost and expense related to entering into this Agreement
and consummating the transactions contemplated hereby, BUYER will make
a cash payment to SELLER, if permitted by BUYER's primary federal
regulator, of $100,000 (the "Expense Fee") if and only if, SELLER has
terminated this Agreement pursuant to Section 11.1(e) of this
Agreement and the breach of the representation, warranty, covenant, or
agreement was caused by the wilful conduct or gross negligence of
BUYER or BANCORP. Such an Expense Fee shall be the SELLER's and FCFC's
exclusive remedy if this Agreement is terminated as set forth in the
prior sentence.
(c) As a condition of BUYER's and BANCORP's willingness, and in order
to induce each of them, to enter into this Agreement and to reimburse
them for incurring the cost and expense related to entering into this
Agreement and consummating the transactions contemplated hereby,
SELLER will make a cash payment to BUYER, if permitted by SELLER's
primary federal regulator, of $100,000 (the "Expense Fee") if and
only if, BUYER or BANCORP has terminated this Agreement pursuant to
Section 11.1(e) of this Agreement and the breach of the
representation, warranty, covenant, or agreement was caused by the
wilful conduct or gross negligence of SELLER. Such an Expense Fee
shall be BUYER's and BANCORP's exclusive remedy if this Agreement is
terminated as set forth in the prior sentence.
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ARTICLE 12
EMPLOYEES
12.1 Access to Branch Employee Records; Interviews; Offers to Hire.
Schedule 10 herein lists all employees of SELLER assigned to the Branch Office
as of March 31, 1996. SELLER agrees to use its best efforts to obtain the
Employees' written consents to give BUYER access to employee files no later than
three (3) Business Days after date of this Agreement. BUYER shall be entitled,
but is not obligated, subsequent to the public announcement of the transaction
contemplated hereby, to personally interview each Branch employee. After the
date hereof, BUYER may, in its sole discretion, extend offers of employment to
the Employees to be effective on or after the Closing Date. Any such Employee
offered employment by BUYER shall be hired on such terms and conditions as BUYER
shall determine except as otherwise expressly provided in this Article 12.
BUYER shall not be required or obligated to hire any employees of SELLER.
12.2 Certain Responsibilities. Neither BUYER nor BANCORP shall have
responsibility for any severance, termination, or similar payments for any
employee, except as become payable under its policies then in effect upon
termination of an Employee who has been employed by BUYER. SELLER shall
indemnify and hold BUYER and BANCORP harmless from and against any and all
liabilities which may arise as a result of any Employee's employment by SELLER
on or prior to the Closing Date. BUYER and BANCORP shall indemnify and hold
SELLER harmless from and against any and all liabilities which may arise as a
result of any Employee's employment by BUYER or BANCORP after the Closing Date.
12.3 Employment Contracts and Benefit Plans; No Enforceable Employee
Rights.
(a) SELLER Plans. Neither BUYER nor BANCORP is assuming, nor shall either
of them have responsibility for the continuation of or any liabilities
under or in connection with (i) any employment contract, collective
bargaining agreement, plan or arrangement providing for insurance
coverage or for deferred compensation, bonuses, stock options or other
forms of incentive compensation or post-retirement compensation or
benefits which are entered into or maintained, as the case may be, by
SELLER, or (ii) any employee benefit plan as defined in Section 3(3)
of ERISA which is subject to any provision of ERISA and is maintained,
administered or contributed to by SELLER.
(b) Employee Rights. This Agreement is not intended to create and does
not create any contractual or legal rights enforceable by any employee
of SELLER or BUYER. This Agreement may be amended or terminated
without liability to any employee.
12.4 Communication with Employees. BUYER agrees to obtain prior approval
of SELLER before sending any communications to any Branch Employee concerning
the subject matter of this Section, which approval shall not be unreasonably
withheld.
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ARTICLE 13
OTHER AGREEMENTS
13.1 Payment of Items Following Closing; Other Transition Arrangements.
(a) Payment by BUYER. Following the Closing Date, the BUYER shall pay, in
accordance with law and customary banking practices, all properly
drawn and presented checks, and ACH debits and credits, ATM deposits
and withdrawals, drafts and withdrawal orders presented to the BUYER
by mail, over the counter, through the check clearing system of the
banking industry, by depositors of the Branch Deposits on checks,
drafts or withdrawal order forms provided by the SELLER, and in all
other respects, to discharge, in the usual course of the banking
business, the duties and obligations of the SELLER with respect to the
balances due and owing to the depositors whose deposits are assumed by
the BUYER.
(b) Payment by SELLER. If any depositors having Branch Deposits, instead
of accepting the obligations of BUYER to pay the Branch Deposits
assumed hereunder, shall demand payment from SELLER for all or any
part of such Branch Deposits, SELLER shall not be liable or
responsible for making such payment except as provided by law. SELLER
may refer all such depositors to BUYER in the manner and with such
instructions, if any, as shall hereafter be established by SELLER and
BUYER, and BUYER shall thereupon be responsible for making such
payment to such depositor. If any of the depositors of the Branch
Deposits draws a check, has or makes an ACH generated debit or credit
with respect to his or her account, makes an ATM deposit or
withdrawal, draft or withdrawal order against the Branch Deposits,
including accrued interest, assumed from the SELLER, which is
presented or charged to the SELLER within 60 days after the Closing
Date, the SELLER may pay the same and the BUYER will reimburse the
SELLER for any such payment or charges. The BUYER and the SELLER
shall promptly settle pursuant to procedures that they shall mutually
establish.
(c) Direct Routing. Prior to the Closing Date, SELLER and BUYER shall
cooperate and take all reasonable action as is necessary to arrange
for the direct routing through the check clearing system of the
banking industry, to be effective on the Closing Date, of all checks,
drafts, withdrawal orders, ACH debits and credits, ATM deposits and
withdrawals relating to the Branch Deposits on SELLER's forms and
carrying its imprint (including name and transit routing number).
(d) Direct Deposits. SELLER shall provide all information and take all
steps required to be taken by it that are reasonably necessary for
BUYER to effect the transfer of any direct deposit arrangement
affecting any of the Branch Deposits and, after the Closing Date,
shall promptly pay to BUYER, without interest, any funds received by
SELLER which are intended to be credited to any such Branch Deposits.
BUYER shall complete all actions necessary to effect the transfer of
such direct deposit arrangements within sixty (60) days following the
Closing Date. SELLER shall have the right to return to the payor any
direct deposit item received by it subsequent to sixty (60) days after
the Closing Date, or such other time period as BUYER and SELLER may
mutually agree upon.
(e) Notice and Availability of Items. For a period of 60 days after the
Closing Date, the SELLER shall, pursuant to the procedures that BUYER
and SELLER shall mutually establish, promptly provide notice of and
make available to the BUYER at SELLER's processing center in
Alexandria, Virginia, checks presented to the SELLER for payment which
are drawn on accounts which are included in the Branch Deposits. Such
procedure shall recognize the importance of timely notice and
availability of such items to potential losses and to customer
relations.
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(f) Confidentiality. SELLER and BUYER further agree that at all times each
party shall preserve and maintain the confidentiality of all such
records of account and other depositor or customer information in
accordance with customary banking practices and all applicable federal
and state laws, rules and regulations.
13.2 Holds, etc. The SELLER shall deliver on the Closing Date to the BUYER
a schedule of holds (Schedule 7) that have been placed by SELLER on particular
Branch Deposits or on individual checks, drafts or other instruments.
13.3 Withholding. SELLER shall deliver to BUYER on or before the Closing
Date a copy of all "B" notices (TIN's that do not match) and "C" notices (under-
reporting/IRS imposed withholding) received from the Internal Revenue Service
imposing withholding restrictions and for the 365 calendar days after the
Closing Date shall continue to deliver such notices with respect to Branch
Deposits to BUYER whenever they are received. All notices received by SELLER
for the 365 calendar days after the Closing Date from the Internal Revenue
Service releasing withholding restrictions on Branch Deposit accounts
transferred to BUYER under this Agreement will be forwarded to BUYER. Any
amounts required by any governmental agencies to be withheld from any of the
Branch Deposits (the "Withholding Obligations") will be handled as follows:
(a) Withholding by SELLER. Any Withholding Obligations required to be
remitted to the appropriate governmental agency on or prior to the
Closing Date will be withheld and remitted by SELLER, and any other
sums withheld by SELLER pursuant to Withholding Obligations prior to
the Closing Date shall also be remitted by SELLER to the appropriate
governmental agency on or prior to the time they are due;
(b) Withholding by BUYER. Any Withholding Obligations required to be
remitted to the appropriate governmental agency after the Closing Date
with respect to Withholding Obligations after the Closing Date and not
withheld by SELLER as set forth in Paragraph (a) of Section 13.3 will
be withheld and remitted by BUYER;
(c) Penalties. Any penalties described on "B" notices from the
Internal Revenue Service or any similar penalties which relate to
Deposit accounts opened by SELLER prior to the Closing Date will be
paid by SELLER promptly upon receipt of the notice, providing such
penalty assessment resulted from SELLER's acts, policies, or
omissions. The BUYER will make a good-faith effort to cooperate with
SELLER to remedy all "B" notice problems. Any penalties described on
the "B" notices received from the Internal Revenue Service or any
similar penalties that relate to Deposit accounts for the period
subsequent to the Closing Date shall be the responsibility of BUYER if
such penalty assessment resulted from BUYER's acts, policies, or
omissions, unless such acts, policies or omissions arise from, relate
to or result from the failure of SELLER to deliver applicable notice
or records pursuant to this Agreement.
13.4 Retirement Accounts.
(a) Notice to Participants. SELLER will send to all IRA and Keogh
participants included in the Branch Deposits a notice pursuant to
applicable IRA and Keogh trustee or custodial agreements stating that
SELLER is resigning as trustee of the participant's IRA or Keogh, and
that, in the absence of objection by the participant received within
thirty (30) calendar days of such notice, BUYER or its designee will
become successor Trustee of the IRA or Keogh on the Closing Date.
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(b) IRA and Keogh Documents. SELLER will provide BUYER with the
proper original trust documents for any IRA and Keogh deposits assumed
by BUYER under Section 2.3 of this Agreement.
(c) Tax Reporting and Fees. SELLER shall be responsible for all
Federal and State income tax reporting of IRA and Keogh accounts for
the period of time prior to the Closing Date. BUYER shall be
responsible for all Federal and State income tax reporting for the
period of time from and after the Closing Date. SELLER agrees that it
will collect no fees for the transferred IRA and Keogh accounts
relating to periods after the closing without the prior written
consent of BUYER.
13.5 Interest Reporting. SELLER shall report from and including January
1, 1996 until the Closing Date all interest credited to, interest withheld from
and early withdrawal penalties charged to the Branch Deposits which are assumed
by BUYER under this Agreement. BUYER shall report from the Closing Date through
the end of the calendar year and thereafter all interest credited to, interest
withheld from, and early withdrawal penalties charged to the Branch Deposits
assumed by BUYER. Said reports shall be made to the holders of these accounts
and to the applicable Federal and State regulatory agencies. BUYER assumes no
responsibility for reports with respect to Deposits which it does not assume
hereunder.
13.6 Magnetic Tape of Branch Deposits. SELLER shall use its best efforts
to provide BUYER a magnetic tape of the owners of the Branch Deposits to be
assumed periodically as requested by BUYER and as of month-end prior to the
scheduled Closing. Within five (5) calendar days after the Closing Date, SELLER
shall provide BUYER a final magnetic tape of the owners.
13.7 ATM Card Processing. SELLER will void on and as of the close of
business on the day prior to the Closing Date all ATM access cards issued by it
to account holders of Branch Deposits who will not have ATM card-accessible
accounts with SELLER after the Closing Date. SELLER will notify the customers in
writing at least thirty (30) calendar days prior to the Closing Date of such
cancellation of such cards. SELLER will provide BUYER with a magnetic tape of
ATM card holders no later than thirty (30) calendar days prior to the Closing
Date.
13.8 Overdraft Coverage. BUYER will use its customary efforts to collect
all overdraft balances of Branch Deposits as of the Closing Date. Within five
(5) Business Days following the close of business of a thirty (30) calendar day
period following the Closing Date, SELLER will reimburse BUYER for, and purchase
all of BUYER's right, title and interest in, each overdraft balance which was
transferred to BUYER and remained an overdraft balance throughout such thirty
(30) calendar day period following Closing. The amount of such payment by SELLER
to BUYER for each such overdraft shall be equal to the lesser of the overdraft
balance at Closing or the lowest overdraft balance during such thirty (30)
calendar day period, determined without the effect of any overdraft fees.
13.9 Taxpayer Information. SELLER shall deliver to BUYER within five (5)
Business Days after the Closing Date (i) TINs (or record of appropriate
exemption) for all holders of Branch Deposits acquired by BUYER pursuant to this
Agreement and (ii) all other information in SELLER's possession or reasonably
available to SELLER required by applicable law to be provided to the Internal
Revenue Service with respect to the Assets and Branch Deposits transferred
pursuant to this Agreement and the holders hereof, except for such information
which SELLER is obligated to make reports pursuant to Sections 13.3, 13.4 and
13.5 of this Agreement (collectively, the "Taxpayer Information"). In the event
SELLER is not able to deliver to BUYER all Taxpayer Information, upon BUYER's
request SELLER shall fully and completely research its records and files and
provide such requested Taxpayer Information, or the reason for its
unavailability, within five (5) Business Days of BUYER's request. SELLER hereby
certifies that such information, when delivered, shall accurately reflect the
information provided by SELLER's customers. SELLER shall hold BUYER harmless
with respect to any inaccuracy, act, or omission by SELLER in connection with
the collection, recording, filing with appropriate governmental agencies, or
delivery to BUYER of the Taxpayer Information accordance with this Section 13.9
hereof.
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13.10 Account Statements. SELLER will provide account statements in its
customary form to all holders of Branch Deposits reflecting activity to the
Closing Date and the balances as of such date.
13.11 Posting of Interest. SELLER shall post interest to the Branch
Deposits, other than fixed term deposits, in accordance with their terms to the
Closing Date.
13.12 Allocation of Asset Values and Reporting Thereof. Prior to or
within forty-five (45) Business Days after the Closing Date, BUYER may, in its
sole discretion, at its own expense select and retain an independent accounting
or consulting firm, which selection shall be made by BUYER sole discretion, to
perform a review and analysis of the transaction described by this Agreement,
the Deposits assumed by BUYER hereunder, and the consideration paid therefore
for the purposes of determining the appropriate valuations for BUYER's tax
records. This review and analysis may be based upon records, accounting data,
and other information concerning the Deposits provided by SELLER, as reasonably
requested by the referenced accounting or consulting firm, and shall utilize
industry-standard methodologies. Based upon this review and analysis, such
accounting or consulting firm shall establish independently an objective
allocation of the consideration received under this Agreement for purposes of
Section 1060 of the Internal Revenue Code, if applicable, which shall be
reasonably acceptable to BUYER and SELLER.
13.13 Conversion Cooperation. SELLER and BUYER will cooperate fully in
order to effect a prompt and secure transfer of the electronic and other
accounting and recordkeeping for the Branch Deposits and Assets and each will
use its best efforts to obtain the full cooperation of their data processing
providers in connection with such transfer.
ARTICLE 14
GENERAL PROVISIONS
14.1 Survival. The representations and warranties made by the parties to
this Agreement, and their respective obligations to be performed under the
terms hereof at, prior to, or after the Closing, shall not expire with, or be
terminated or extinguished by the Closing, notwithstanding any investigations of
the facts constituting the basis of the representations and warranties of any
party by the other party hereto, provided that any representation or warranty
made as of a particular date need be true only at that date unless expressly
provided otherwise herein.
14.2 Indemnification.
(a) By SELLER. SELLER shall indemnify, hold harmless and defend
BUYER, BANCORP (and their respective Affiliates) from and against any
and all damage, loss, liability, cost, claim or expense (including
legal fees and expenses) actually incurred or suffered by BUYER or
BANCORP (or their Affiliates) in connection with:
(1) Any misrepresentation or breach of warranty, covenant or
agreement made or to be performed by SELLER pursuant to this
Agreement; or
(2) Any action taken or omitted to be taken by SELLER, or any
transaction or any event occurring on or prior to the Closing
Date, relating to the Assets, the Fixed Assets, the Real Property
or the Branch Deposits, other than as permitted by this
Agreement; and
(3) Any Employee liabilities, arising prior to the Closing Date
and any suits or proceeding commenced in connection with any of
the foregoing.
(b) By FCFC. FCFC shall indemnify, hold harmless and defend BUYER,
BANCORP (and their respective Affiliates) from and against any and all
damage, loss, liability, cost, claim or expense (including legal fees
and expenses) actually incurred or suffered by BUYER or BANCORP (or
their Affiliates) in connection with:
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(1) Any misrepresentation or breach of warranty, covenant or
agreement made or to be performed by FCFC, pursuant to this
Agreement; or
(2) Any action taken or omitted to be taken by FCFC, or any
transaction or any event occurring on or prior to the Closing
Date, relating to the Assets, the Fixed Assets, the Real Property
or the Branch Deposits, other than as permitted by this
Agreement.
(c) By BUYER. BUYER shall indemnify, hold harmless and defend SELLER
and FCFC (and their respective Affiliates) from and against any and
all damage, loss, liability, cost, claim or expense (including legal
fees and expenses) actually incurred or suffered by SELLER or FCFC (or
their respective Affiliates) in connection with:
(1) Any misrepresentation or breach of warranty, covenant or
agreement made or to be performed by BUYER pursuant to this
Agreement; and
(2) Any action taken or omitted to be taken by BUYER, or any
transaction or any event occurring on or after the Closing Date,
relating to the Assets or the Branch Deposits, to the extent that
such Assets or Branch Deposits are assumed by or transferred to
BUYER;
(3) Any Employee liabilities, arising subsequent to the Closing
Date and any suits or proceedings commenced in connection with
any of the foregoing.
(d) By BANCORP. BANCORP shall indemnify, hold harmless and defend
SELLER and FCFC (and their respective Affiliates) from and against any
and all damage, loss, liability, cost, claim or expense (including
legal fees and expenses) actually incurred or suffered by SELLER or
FCFC (or their respective affiliates) in connection with:
(1) Any misrepresentation or breach of warranty, covenant or
agreement made or to be performed by BANCORP pursuant to this
Agreement; and
(2) Any action taken or omitted to be taken by BANCORP, or any
transaction or any event occurring on or after the Closing Date,
relating to the Fixed Assets or the Real Property and any suits
or proceedings commenced in connection therewith.
(e) Defense of Claim. A party seeking indemnification pursuant to
this Section 14.2 (an "indemnified party") shall give prompt notice to
the party from whom such indemnification is sought (the "indemnifying
party") of the assertion of any claim, or the commencement of any
action or proceeding, in respect of which indemnity may be sought
hereunder. The indemnified party shall assist the indemnifying party
in the defense of any such action or proceeding. The indemnifying
party shall have the right to, and shall at the request of the
indemnified party, assume the defense of any such action or proceeding
at its own expense. In any such action or proceeding, the indemnified
party shall have the right to retain its own counsel, but the fees and
expenses of such counsel shall be at its own expense unless:
(1) The indemnifying party and the indemnified party shall have
mutually agreed to the retention of such counsel; or
(2) The named parties to any such suit, action or proceeding
(including any impleaded parties) include both the indemnifying
party and the indemnified party and, in the reasonable judgment
of the indemnified party, representation of both parties by the
same counsel would be inappropriate due to actual or potential
differing interests between them.
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(f) Settlement. An indemnifying party shall not be liable under this
Section 14.2 for any settlement effected without its consent of any
claim, litigation or proceeding in respect of which indemnity may be
sought hereunder. The indemnifying party may settle any claim without
the consent of the indemnified party, but only if the sole relief
awarded is monetary damages that are paid in full by the indemnifying
party. An indemnified party shall, subject to its reasonable business
needs, use reasonable efforts to minimize the indemnification sought
from the indemnifying party hereunder. Notwithstanding the foregoing,
no investigation by an indemnified party at or prior to the Closing
shall relieve an indemnifying party of any liability hereunder, unless
the indemnified party seeks indemnity in respect of a representation
or warranty which it actually had reason to believe to be incorrect as
a result of its investigation prior to the Closing and the indemnified
party intentionally failed to bring such belief to the attention of
the indemnifying party prior to the Closing.
14.3 Consultant's Fees. Each of the parties represents and warrants to
the other that, except for the engagement of Anchor Financial Group, LLC
("Anchor") by SELLER, it has dealt with no consultant, broker, or finder in
connection with any of the transactions contemplated by this Agreement, and that
no action has been taken that would give rise to any valid claim for brokerage
commission, finder's fee or other like commission. SELLER shall pay a fee of
$100,000 to Anchor at the Closing. SELLER and BUYER each undertake to indemnify
and hold harmless the other and its affiliates against any loss, liability,
damage, cost, claim or expense incurred by reason of any brokerage commission or
finder's fee alleged to be payable because of any act, omission or statement of
the indemnifying party.
14.4 Publicity. Prior to the Closing Date, no party shall, directly or
indirectly, make or cause to be made any public announcement or disclosure, or
issue any notice, with respect to any of the transactions contemplated hereby
without the prior consent of the other party, which consent shall not be
unreasonably withheld, except as required by law. Prior to any such announcement
or disclosure, the parties will limit the distribution of information relative
to this transaction to those persons who must be aware of the agreement for the
performance of their duties.
14.5 Incorporation of Exhibits. All Exhibits and Schedules attached hereto
and referred to herein are incorporated in this Agreement as though fully set
forth herein.
14.6 Attorneys' Fees. Each party shall bear the cost of its own attorneys'
fees incurred in connection with the preparation of this Agreement and
consummation of the transactions described herein. Notwithstanding the
foregoing, in any action between the parties seeking enforcement of any of the
terms and provisions of this Agreement or in connection with any of the property
described herein, the prevailing party in such action shall be awarded, in
addition to damage, injunctive or other relief, its reasonable costs and
expenses, not limited to taxable costs, and reasonable attorneys' fees.
14.7 Notices. All notices, requests, demands and other communication given
or required to be given under this Agreement shall be in writing, duly addressed
to the parties as follows:
To BUYER or BANCORP
FWB Bancorporation, Inc.
FWB Bank
1800 Rockville Pike
Rockville, MD 20852
Attn: Steven K. Colliatie
President and CEO
With copy to: James I. Lundy III, Esquire
Kennedy & Baris, L.L.P.
4719 Hampden Lane
Bethesda, MD 20814
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To SELLER: First Commonwealth Savings Bank FSB
301 South Washington Street
Alexandria, VA 22314
Attn: Robert N. Kemp, Jr., President
With copy to: W. Michael Herrick, Esquire
Elias, Matz, Tiernan & Herrick, L.L.P.
734 15th Street, Northwest
12th Floor
Washington, D.C. 20005
To FCFC: First Commonwealth Financial Corp
12105 Greenleaf Avenue
Potomac, Maryland 20854
Attn: John C. York, Jr.
With copy to: Richard E. Byer, P.C.
Silver Freedman & Taff, L.L.P.
1100 New York Avenue, Northwest
Washington, D.C. 20005
Any such notice sent by registered or certified mail, return receipt
requested, or by overnight courier, such as Federal Express, shall be deemed to
have been duly given and received forty-eight (48) hours after the same is so
addressed and mailed with postage prepaid. Notice sent by any other manner
shall be effective only upon actual receipt thereof.
14.8 Arms Length Transactions. This Agreement has been negotiated at arm's
length and between persons sophisticated and knowledgeable in the matters dealt
with in this Agreement. In addition, each party has been represented by
experienced and knowledgeable legal counsel. Accordingly, any rule of law or
legal decision that would require interpretation of any ambiguities in this
Agreement against the party that has drafted it is not applicable and is waived.
The provisions of this Agreement shall be interpreted in a reasonable manner to
effect the purposes of the parties and this Agreement.
14.9 Assignment. This Agreement may not be assigned by any party without
the prior written consent of the other parties, which consent shall not be
unreasonably withheld, and any attempted assignment in violation of this Section
is void.
14.10 Successors and Assigns. This Agreement shall be binding upon the
parties hereto and their respective successors and assigns, and, without
limitation, each of the parties shall assure that its respective obligations
hereunder are satisfied or adequately provided for in any liquidation of such
party or the sale of all or substantially all of its assets.
14.11 Third Party Beneficiaries. Each party hereto intends that this
Agreement shall not benefit or create any right or cause of action in or on
behalf of any person other than the parties hereto.
14.12 Governing Law. Except as required by federal law, this Agreement
shall be governed by and construed in accordance with the internal laws of the
Commonwealth of Virginia without regard to the rules thereof regarding choice of
laws.
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14.13 Entire Agreement. This Agreement contains all of the agreements of
the parties to it with respect to the matters contained herein and no prior or
contemporaneous agreement or understanding, oral or written, pertaining to any
such matters shall be effective for any purpose. No provision of this Agreement
may be amended or added to except by an agreement in writing signed by the
parties hereto or their respective successors in interest and expressly stating
that it is an amendment of this Agreement.
14.14 Headings. The headings of this Agreement are for purposes of
reference only and shall not limit or define the meaning of the provisions of
this Agreement.
14.15 Severability. If any paragraph, Section, sentence, clause or phrase
contained in this Agreement shall become illegal, null or void or against public
policy, for any reason, or shall be held by any court of competent jurisdiction
to be illegal, null or void or against public policy, the remaining paragraphs,
sections, sentences, clauses or phrases contained in this Agreement shall not be
affected thereby.
14.16 Waiver. The waiver of any breach of any provision under this
Agreement by any party hereto shall not be deemed to be a waiver of any
preceding or subsequent breach under this Agreement.
14.17 Number(s). Whenever the context of this Agreement so requires, the
singular includes the plural, the plural includes the singular, the whole
includes any part thereof.
14.18 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original but all of which shall
constitute one and the same instrument.
14.19 Cooperation. BANCORP, BUYER, SELLER and FCFC will cooperate to
effect the transactions described in this Agreement and otherwise to accomplish
its purposes for such time as may be necessary.
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In WITNESS WHEREOF, the parties hereto have duly authorized and executed
this Agreement as of the date first above written.
ATTEST FIRST COMMONWEALTH SAVINGS BANK FSB
s\ Greg A. Murray By: s\ Robert N. Kemp
- ------------------------------ -------------------------------------
Senior Vice President Title: President and Chief Executive
Officer
WITNESS FIRST COMMONWEALTH FINANCIAL CORP
s\ Stuart C. Yarborough By: s\ John C. York
- ------------------------------ -------------------------------------
Title: Chairman of the Board
WITNESS FWB BANK
s\ Stuart C. Yarborough By: s\ Steven Colliatie
- ------------------------------ --------------------------------------
Title: President and Chief Executive
Officer
WITNESS FWB BANCORPORATION
s\ Stuart C. Yarborough By: s\ Steven Colliatie
- ------------------------------ -------------------------------------
Title: President and Chief Executive
Officer
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FOR IMMEDIATE RELEASE CONTACT: Steven K. Colliatie
President and Chief Executive Officer
FWB Bancorporation
FWB Bank
(301) 770-1300
Rockville, MD - FWB Bancorporation, the parent corporation of FWB Bank,
announced today that it had reached an agreement to acquire the Alexandria,
Virginia office of First Commonwealth Savings Bank FSB (First Commonwealth),
along with approximately $60 million in deposits and a portfolio of commercial
and consumer loans. The acquisition is subject to regulatory approvals, and is
expected to be completed within the next several months.
Steven K. Colliatie, President and Chief Executive Officer of FWB Bank and
FWB Bancorporation said, "The First Commonwealth tradition of quality and
dedication to customer satisfaction is well known in the community. We consider
it an exceptional opportunity to serve the consumers and businesses in the
Alexandria area."
John C. York, Chairman of First Commonwealth Financial Corporation (FCFC),
the parent of First Commonwealth, said, "One of the deciding factors in choosing
FWB was their concern for the customers of First Commonwealth. This agreement
ensures that they will continue to be served by a solid financial institution
committed to customer service."
The FWB FCFC agreement calls for the exchange of cash, preferred stock, and
warrants. FWB Bank is a Maryland chartered commercial bank with offices in
Rockville, Bethesda and Germantown, Maryland. The deposits of FWB Bank are
insured by the Bank Insurance Fund of the Federal Deposit Insurance Corporation.
