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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
FORM 8-K
Pursuant to Section 13 or 15 (d) of the Securities Exchange Act of 1934
Date of Report (date of earliest event reported) FEBRUARY 9, 1998
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UNITED BANCORP, INC.
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(Exact name of registrant as specified in its charter)
OHIO 0-16540 34-1405357
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification #)
201 S. FOURTH STREET, MARTINS FERRY, OHIO 43935
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(Address of principal executive offices) (Zip Code)
(740) 633-0445
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(Registrant's telephone number, including area code)
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(Former name or former address, if changed since last report)
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ITEM 5. OTHER EVENTS
On February 9, 1998 United Bancorp, Inc. entered into a Definitive
Agreement ("Agreement") with Southern Ohio Community Bancorporation, Inc.
("Southern") of Glouster Ohio. The Agreement incorporates the terms of the
letter of intent entered into January 12, 1998. Randall M. Greenwood, Vice
President and Chief Financial Officer stated upon completion of the merger,
each share of Southern common outstanding stock will be exchanged for 11 shares
of UBCP common shares in a tax-free exchange and for financial reporting
purposes will be accounted for under the pooling of interest method of
accounting. Based on a current market price of $26, the transaction is valued
at approximately $11.2 million.
James W. Everson stated "With the Agreement behind us we have initiated
the process to bring Southern into our family of banks and provide them with
our expanded base of financial services products for their marketing area."
Southern's operating subsidiary, The Glouster Community Bank, will retain its
identity as the third banking charter and has assets of approximately $52
million, loans of $32 million, and deposits of $48 million. Operating in the
Northern half of Athens County Ohio, The Glouster Community Bank, operates two
offices in Glouster, in addition to an office in Amesville and Nelsonville,
Ohio.
Pending regulatory and Southern's shareholder approval, the transaction is
expected to be completed during the third quarter of 1998.
United Bancorp, Inc. is headquartered in Martins Ferry, Ohio and is a
multi-bank holding company with total assets of $212 million and total
shareholder equity of approximately $21.9 million as of December 31, 1997.
Affiliates of UBCP include The Citizens Savings Bank with offices in
Bridgeport, Colerain, St. Clairsville and Martins Ferry, Ohio and The Citizens
State Bank with offices in Strasburg, Dellroy, Dover, Sherrodsille and New
Philadelphia, Ohio. The Company trades on The Nasdaq SmallCap Market tier of
the Nasdaq under the symbol UBCP, Cusip #90991109. In April of 1998 you can
reach us on the Internet at http://www.unitedbancorp.com.
ITEM 7. EXHIBITS
The following exhibit is being filed as part of this Form 8-K.
Merger Agreement between United Bancorporation, Inc. and Southern Ohio
Community Bancorporation, Inc.
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.
February 16, 1998 by: /s/ James W. Everson
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Date Chairman, President and CEO
United Bancorp, Inc.
(Registrant)
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INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION
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1 Merger Agreement
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EXHIBIT 1
MERGER AGREEMENT
This Merger Agreement ("Agreement") is entered into as of this 9th
day of February, 1998, by and between United Bancorp, Inc. (hereinafter
called "UBCP") and Southern Ohio Community Bancorporation, Inc. (hereinafter
called "Southern").
RECITALS
A. UBCP is a corporation duly organized under the laws of the State
of Ohio. Its principal office is located at 201 South Fourth Street, Martins
Ferry, Ohio 43935. As of the date hereof, UBCP had authorized capital stock
consisting of 10,000,000 shares of common stock, $1 par value ("UBCP Common
Stock") of which a total of 2,238,314 shares were issued and outstanding and no
shares were held as treasury shares. UBCP owns all of the outstanding capital
stock of The Citizens Savings Bank and the Citizens-State Bank each of which is
a state banking corporation organized under the laws of the State of Ohio,
hereinafter the Subsidiaries.
B. Southern is a corporation duly organized under the laws of the
State of Ohio. Its principal office is located at 88 High Street, Glouster,
Ohio 45732. As of the date hereof, Southern had authorized capital stock
consisting of 39,000 shares of common stock, $5 par value ("Southern Common
Stock"), of which 39,000 shares were issued and outstanding and no shares were
held as treasury shares. Southern owns all of the outstanding capital stock of
The Glouster Community Bank (hereinafter referred to as the "Glouster Bank"), a
banking corporation organized under the laws of the State of Ohio.
C. The Board of Directors of UBCP and the Board of Directors of
Southern, respectively, have each unanimously approved the entering into of
this Merger Agreement and have authorized the execution and delivery of this
Merger Agreement. From and after the time the merger of Southern into UBCP
shall become effective, the "Merger" as defined in Section 1 of this Merger
Agreement, and as and when required by this Merger Agreement, UBCP will issue
shares of UBCP Common Stock in exchange for all of the issued and outstanding
shares of Southern Common Stock in accordance with the provisions hereinafter
set forth. It is understood by each of the parties hereto that UBCP seeks to
acquire Southern and all of the operating assets of Southern including the
Glouster Bank and the entities and assets which Southern and the Glouster Bank
may acquire prior to the time the Merger shall become effective, through the
Merger of Southern with and into UBCP under the charter of UBCP and Glouster
Bank will, immediately after the effective date of the Merger, remain an
independent operating subsidiary of UBCP. The parties will exert their best
efforts to obtain such regulatory approvals and to complete such other actions
as are necessary or appropriate to effect the Merger.
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AGREEMENT
In consideration of mutual covenants and premises herein contained, UBCP and
Southern hereby make this Merger Agreement and prescribe the terms and
conditions of the Merger and the mode of carrying the Merger into effect as
follows:
1. Merger. Subject to the terms and conditions hereinafter set forth,
Southern shall be merged with and into UBCP under the Articles of
Incorporation of UBCP pursuant to and in accordance with the
applicable provisions of the laws of the State of Ohio ("Merger").
2. Name. The name of the surviving holding corporation (hereinafter
called the "Surviving Corporation" whenever reference is made to it as
of the time the Merger shall become effective, as hereinafter
provided, or thereafter) shall be "United Bancorp, Inc."
3. Business. The business of UBCP as the Surviving Corporation shall be
that of a bank holding company. The Surviving Corporation shall
exist by virtue of, and be governed by the laws of the State of Ohio
and shall have its principal office in Ohio at 4th at Hickory Street,
Martins Ferry, Ohio 43935.
4. Effective Time of Merger: Certificate of Merger. The Merger shall
become effective upon the date of the filing of the appropriate
Certificate of Merger with the Ohio Secretary of State (the "time the
Merger shall become effective") in accordance with applicable
provisions of the laws of the State of Ohio.
The Articles of Incorporation of UBCP in effect immediately prior to
the time the Merger shall become effective, shall be the Articles of
Incorporation of the Surviving Corporation, and the Code of
Regulations of UBCP in effect immediately prior to the time the Merger
shall become effective, shall be the Code of Regulations of the
Surviving Corporation.
5. Effect of Merger. At the time the Merger shall become effective, the
separate corporate existence of Southern shall, in accordance with
applicable provisions of the laws of the State of Ohio, be merged into
and continued in UBCP as the Surviving Corporation, with the effect as
provided by Section 1701.82 of the Ohio Revised Code.
6. Liabilities upon Merger. The Surviving Corporation shall be
responsible for all of the liabilities and obligations of each of the
corporations so merged in the same manner and to the same extent as if
such single corporation had itself incurred the same or contracted
therefor, all in the manner and as provided for by Sections
1701.82(A)(1),(2),(3),(4), and (5) of the Ohio Revised Code.
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7. Conversion of Shares.
(a) At the time the Merger shall become effective;
(i) All of the outstanding shares of Southern Common
Stock shall be converted by operation of law into
shares of UBCP Common Stock without any action by the
holder thereof and each such share shall be exchanged
for 11 shares of UBCP Common Stock hereinafter the
"Exchange Ratio."
(ii) The shares of UBCP Common Stock issued and
outstanding immediately prior to the time the Merger
shall become effective shall continue to be issued
and outstanding shares of the Surviving Corporation.
(iii) If prior to the Merger, shares of UBCP Common Stock
shall be changed into a different number of shares or
a different class of shares by reason of any
reclassification, recapitalization, split-up,
combination, exchange of shares or readjustment, or
there occurs a distribution of warrants or rights
with respect to the UBCP Common Stock or a stock
dividend, stock split or other general distribution
of UBCP Common Stock is declared with a record date
prior to the effective time of the Merger, then in
any event the Exchange Ratio shall be appropriately
adjusted.
(b) No fractional shares of UBCP Common Stock will be issued by
UBCP in connection with the Merger, but in lieu thereof,
holders of Southern Common Stock shall, upon surrender of the
certificate or certificates formerly representing such
Southern Common Stock be paid cash without interest by UBCP
for such fractional share(s). The cash paid for each
fractional share shall be the same fraction of the average bid
and asked closing price per share of UBCP Common Stock on the
Closing Date.
(c) As soon as practicable, but not later than thirty (30) days
after the time the Merger shall become effective, and subject
to the provisions set forth above relating to the fractional
shares, UBCP, or American Stock Transfer and Trust Company,
New York, as Exchange Agent, will distribute to the former
holders of Southern Common Stock in exchange for and upon
surrender for cancellation by such holders of a certificate or
certificates formerly representing shares of Southern Common
Stock the certificate(s) for shares of UBCP Common Stock in
accordance with the Exchange Ratio and any cash payment in
lieu of fractional shares. Each certificate formerly
representing Southern Common Stock (other than certificates
representing shares of Southern Common Stock subject to the
rights of dissenting shareholders) shall be deemed for all
purposes to evidence the ownership of the number of whole
shares of UBCP Common Stock and
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cash for fractional share interests in UBCP Common Stock into
which such shares have been converted pursuant to the Exchange
Ratio. Until surrender of the certificate or certificates
formerly representing shares of Southern Common Stock, the
holder thereof shall not be entitled to receive any dividend
or other payment or distribution payable to holders of UBCP
Common Stock. Upon such surrender (or in lieu of surrender
other provisions reasonably satisfactory to UBCP as are made
as set forth in the next following paragraph), there shall be
paid to the person entitled thereto the aggregate amount of
dividends or other payments or distributions (in each case
without interest) which became payable after the time the
Merger shall become effective on the whole shares of UBCP
Common Stock represented by the certificates issued upon such
surrender and exchange or in accordance with such other
provisions, as the case may be. After the time the Merger
shall become effective, the holders of certificates formerly
representing shares of Southern Common Stock shall cease to
have rights with respect to such shares (except such rights,
if any, as a holder of certificates formerly representing
shares of Southern Common Stock may have as dissenting
shareholders pursuant to the Ohio General Corporation Law) and
except as aforesaid, their sole rights shall be to exchange
said certificates for certificates for shares of UBCP Common
Stock in accordance with this Merger Agreement.
Certificates formerly representing shares of Southern Common
Stock surrendered for cancellation by each shareholder
entitled to exchange shares of Southern Common Stock for
shares of UBCP Common Stock by reason of the Merger shall be
accompanied by such appropriate instruments of transfer as
UBCP may reasonably require, provided, however, that if there
be delivered to UBCP by any person who is unable to produce
any such certificate formerly representing shares of Southern
Common Stock for transfer (i) evidence to the reasonable
satisfaction of UBCP that any such certificate has been lost,
wrongfully taken or destroyed, and (ii) such indemnity
agreement and, at the discretion of UBCP, an indemnity bond,
as reasonably may be requested by UBCP to save it harmless,
and (iii) evidence to the reasonable satisfaction of UBCP that
such person is the owner of the shares theretofore represented
by each certificate claimed by him to be lost, wrongfully
taken or destroyed and that he is the person who would be
entitled to present each such certificate and to receive
shares of UBCP Common Stock pursuant to this Merger Agreement,
then UBCP, in the absence of actual notice to it that any
shares theretofore represented by any such certificate have
been acquired by a bona fide purchaser, shall deliver to such
person the certificate(s) representing shares of UBCP Common
Stock which such person would have been entitled to receive
upon surrender of each such lost, wrongfully taken or
destroyed certificate representing shares of Southern Common
Stock.
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8. Board of Directors. The Board of Directors of UBCP as constituted at
the time the Merger shall become effective shall serve as the Board of
Directors of UBCP as the Surviving Corporation, plus Mr. L. E.
Richardson, Jr. whom UBCP undertakes to appoint to the Board of
Directors of UBCP as soon as practicable following the effective date
of the Merger.
9. Discussions with Others. From and after the date hereof, Southern will
not, directly or indirectly, through any of its officers, directors,
employees, agents or advisors or other representatives or consultants,
solicit or initiate or knowingly encourage, including by means of
furnishing information, any proposals or offers from any person (other
than UBCP) relating to any acquisition or purchase of all or a
material amount of the assets of, or any securities of, or any merger,
tender offer, consolidation or business combination with, Southern (an
"Acquisition Proposal"); providing, however, that Southern may furnish
information and may consider, evaluate and engage in discussions or
negotiations with any person if outside counsel advises Southern's
directors that failure to furnish such information or engage in such
discussions or negotiations could involve Southern's directors in a
breach of their fiduciary duties. If the Board of Directors of
Southern receives a request for confidential information from a
potential bidder for Southern and the Board of Directors determines,
after consultation with outside counsel, that the Board of Directors
has a fiduciary obligation to provide such information to a potential
bidder, then Southern may, subject to a confidentiality agreement
substantially similar to that previously executed with UBCP, provide
such potential bidder with access to information regarding Southern.
Southern shall promptly notify UBCP, orally and in writing, if any
such proposal or offer is made and shall, in any such notice, indicate
the identity and terms and conditions of any proposal or offer, or any
such inquiry or contact. Southern shall keep UBCP advised of the
progress and status of any such proposals or offers. The obligation
of the Board of Directors of Southern to convene a meeting of its
shareholders and to recommend the adoption and approval of this
Agreement to the shareholders of Southern shall be subject to the
fiduciary duties of the Directors, as determined by the Directors
after consultation with their outside counsel, and nothing contained
in this Agreement shall prevent the Board of Directors of Southern
from approving or recommending to the shareholders of Southern any
unsolicited offer or proposal by a third party if required in the
exercise of their fiduciary duties, as determined by the Directors
after consultation with outside counsel. In order to induce UBCP to
enter into this Agreement and incur the substantial expenses involved
in effectuating the transactions contemplated herein, Southern agrees
and does hereby promise to pay to UBCP the sum of Five Hundred
Thousand Dollars ($500,000), upon UBCP's demand therefor, in the event
that the Southern shareholders: (i) fail to approve the proposed
transaction with UBCP, and (ii) Southern or its shareholders receive
an offer from and negotiate with any party other than UBCP at any time
within one (1) year of the date hereof concerning a merger,
consolidation, purchase of substantially all of the Southern Common
Stock, or similar
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transaction involving either Southern or Glouster Bank or the sale of
all or substantially all of the assets of Southern and/or Glouster
Bank.
10. Undertakings of the Parties. UBCP and Southern further agree as
follows:
(a) This Merger Agreement shall be submitted to the shareholders
of Southern for approval and adoption at a meeting to be
called and held in accordance with law and the Articles of
Incorporation and Code of Regulations of Southern.
(b) UBCP and Southern will cooperate in the preparation by UBCP of
the application to the Board of Governors of the Federal
Reserve System (the "Board") under the appropriate provisions
of Section 3 of the Bank Holding Company Act of 1956, as
amended, and to any other state or federal regulatory agency
which may be required to facilitate the Merger. UBCP will
file such applications promptly after the date of this Merger
Agreement and shall forward a copy of such applications to
Southern and its counsel upon filing. UBCP and Southern will
cooperate in the preparation of proxy and registration
statements under federal and state securities laws so as to
facilitate the exchange of shares as contemplated by this
Merger Agreement.
(c) Each party will assume and pay all of its fees and expenses
incurred by it incident to the negotiation, preparation and
execution of this Agreement, obtaining of the requisite
regulatory and shareholder consents and approvals and all
other acts incidental to, contemplated by or in pursuance of
this Agreement. UBCP shall promptly prepare and file at no
expense to Southern: (i) any and all required regulatory
applications necessary in connection with the transactions
contemplated by this Agreement; and (ii) an S-4 Registration
Statement to be filed with the Securities and Exchange
Commission to register the shares of UBCP Common Stock to be
issued in connection with the transactions contemplated by
this Agreement. Such registration statement will not cover
resales by any persons who may be considered "underwriters"
under Rule 145(c) of the Securities Act of 1933, as amended
(the "1933 Act"). UBCP will also take any action required to
be taken under any applicable state securities or "Blue Sky"
laws in connection with the Merger. UBCP will provide
Southern and its counsel with a copy of the S-4 Registration
Statement for review and comment prior to filing with the
Securities and Exchange Commission.
(d) All information furnished by one party to another party in
connection with this Merger Agreement and the transactions
contemplated hereby will be kept confidential by such other
party and will be used only in connection with this Merger
Agreement and the transactions contemplated hereby, except to
the extent that such information: (i) is already known to such
other party when received; (ii) thereafter becomes lawfully
obtainable
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from other sources; or (iii) is required to be disclosed in
any document filed with the Securities and Exchange
Commission, the Board, or any other governmental agency or
authority (except under a claim of confidentiality). In the
event the Merger Agreement is terminated, all such information
shall be promptly returned by each party to the other party or
be destroyed.
(e) After: (i) receipt of the Federal Reserve Board's prior
approval of UBCP's acquisition of Southern; (ii) the approval
of the shareholders of Southern, as provided in Section 10(a)
has occurred; and (iii) all other regulatory approvals have
been obtained and the regulatory waiting period(s) have
expired, UBCP shall designate the date as of which UBCP
desires the Merger to become effective and shall file the
appropriate Certificate of Merger with the Ohio Secretary of
State in accordance herewith and the time the Merger shall
become effective shall occur at the time and on the date so
designated, consistent with the terms of Section 4 hereof.
However, any date so specified shall not be later than the
last day of the month following the month in which the last of
the above (i-iii) shall occur.
(f) Subject to the terms and conditions of this Merger Agreement,
UBCP and Southern each agree that, subject to applicable laws
and to the fiduciary duties of its Directors, each will
promptly take or cause to be taken all action, and promptly do
or cause to be done all things necessary, proper or advisable
under applicable laws and regulations to consummate and make
effective the Merger and other transactions contemplated by
this Merger Agreement.
(g) UBCP undertakes to cause, immediately after the effective date
of the Merger, the election as Directors of Glouster Bank, all
those persons serving as outside-Directors immediately prior
to the effective time of the Merger together with two
additional persons to be selected by UBCP.
(h) UBCP and its Board of Directors undertake to cause,
immediately after the effective date of the Merger:(i) the
appointment of Harold A. Price, Interim-President and Chief
Executive of Glouster Bank, and (ii) to cause the election by
the Board of Directors of Glouster Bank, Mr. L. E. Richardson,
Jr. as Chairman of Glouster Bank, a non-executive officer and
non-employee position.
(i) Southern shall provide, immediately prior to the effective
time of the Merger, a certificate of its President who shall
identify each person who may reasonably be considered an
affiliate of Southern within the meaning of Rule 145 of the
Securities and Exchange Commission.
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(j) Southern agrees to cause Glouster Bank to permit a UBCP
representative to attend all meetings of Glouster Bank's Board
of Director and all loan committee meetings of Glouster Bank
from and after the date of this Agreement and through the
effective time of the Merger. Nothing herein shall prohibit
Southern or Glouster Bank from making independent decisions,
including lending decisions, of its or their Boards of
Directors.
(k) UBCP undertakes to cause, for at least two (2) years following
the time the Merger shall become effective: (i) the name of
Glouster Bank to remain unchanged, and (ii) to refrain from
closing any offices of Glouster Bank.
(l) UBCP and Southern agree that Southern may purchase "tail
coverage" as provided for in the current insurance policies
maintained by Southern and/or Glouster Bank (or substitute
policies with substantially the same coverage and terms)
covering Southern and Glouster Bank's directors' and officers'
liability with respect to claims which arise from factors or
events which occurred before the effective time of the Merger,
provided, that the aggregate cost of such "tail insurance"
shall not exceed $5,000.
11. Dissenting Shareholders. Holders of Southern Common Stock shall have
the rights accorded to dissenting shareholders under Section 1701.85
of the Ohio Code, as amended.
12. Representations and Warranties of UBCP. UBCP represents and warrants
to Southern as follows:
(a) UBCP is a corporation duly organized and validly existing
under the laws of the State of Ohio, is a registered bank
holding company under the Bank Holding Company Act of 1956, as
amended, and is qualified to do business and is in good
standing in the State of Ohio, together with all other
jurisdictions where it is both required to so qualify and the
failure to so qualify would have material and adverse
consequences to UBCP. UBCP has full power and authority
(including all licenses, franchises, permits and other
governmental authorizations which are legally required) to
engage in the businesses and activities now conducted by it.
As of the date of this Agreement, the authorized capital stock
of UBCP consisted of 10,000,000 shares of common stock, $1 par
value, of which a total of 2,238,314 shares were issued and
outstanding and no shares were held as treasury shares. All
of said shares of capital stock are fully paid and
nonassessable and are not issued in violation of the
preemptive rights of any shareholder. UBCP owns all of the
outstanding capital stock of UBCP's Subsidiaries.
(b) UBCP has furnished to Southern and its counsel copies of the
following financial statements relating to UBCP and its
consolidated subsidiaries: (i) the audited Consolidated
Balance Sheet of UBCP as of December 31,
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1996 and 1995 and the Consolidated Statements of Income,
Shareholders' Equity and Statements of Cash Flows for the
years then ended, together with the notes and report of Crowe,
Chizek & Company LLP thereto and its quarterly financial
reports on Form 10Q for each of the three quarters ended
September 30, 1997. Each of the aforementioned financial
statements is true and correct in all material respects and
together present fairly the consolidated financial position
and results of operations of UBCP as of the dates and for the
periods therein set forth in conformity with generally
accepted accounting principles ("GAAP"). Such financial
statements do not, as of the dates thereof, include any
material asset or omit any material liability, absolute or
contingent, or other fact, the inclusion or omission of which
renders such financial statements, in light of the
circumstances under which they were made, misleading in any
material respect. Since September 30, 1997, there has not
been any material adverse change in the financial condition,
results of operations, business or prospects of UBCP and its
subsidiaries on a consolidated basis.
(c) The Board of Directors of UBCP has unanimously authorized
execution of this Merger Agreement and approved the merger of
Southern and UBCP as contemplated by said Merger Agreement.,
has all requisite power and authority to enter into this
Merger Agreement and UBCP has the authority to consummate the
transactions contemplated hereby. This Merger Agreement
constitutes the valid and legally binding obligation of UBCP
and this Merger Agreement and the consummation hereof has been
duly authorized and approved on behalf of UBCP by all
requisite corporate action. Provided the required approvals
are obtained from the Federal Reserve Board and any other
necessary regulatory agencies, neither the execution and
delivery of this Merger Agreement nor the consummation of the
Merger will conflict with, result in the breach of, constitute
a default under or accelerate the performance provided by the
terms of any law, or any rule or regulation of any
governmental agency or authority or any judgment, order or
decree of any court or other governmental agency to which UBCP
may be subject, any contract, agreement or instrument to which
UBCP is a party or by which UBCP is bound or committed, or the
Articles of Incorporation or Code of Regulations of UBCP or
the Articles of Incorporation or Code of Regulations of UBCP's
Subsidiaries, or constitute an event which, including with the
lapse of time or action by a third party, could, to the best
of UBCP's knowledge, result in the default under any of the
foregoing or result in the creation of any lien, charge or
encumbrance upon any of the assets or properties of UBCP or
any of its subsidiaries or upon any of the stock of UBCP or
any of its subsidiaries, except, however, in the case of
contracts, agreements or instruments, such defaults, conflicts
or breaches which either (i) will be cured or waived prior to
the time the Merger becomes effective, or (ii) if not so cured
or waived would not, in the aggregate, have any material
adverse effect on
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the financial condition, results of operations or business of
UBCP on a consolidated basis.
(d) There is no litigation, action, suit, investigation or
proceeding pending or, to the best of the knowledge after due
inquiry of UBCP and its executive officers, threatened,
against UBCP or its subsidiaries or involving any of their
respective properties or assets, at law or in equity, before
any federal, state, municipal, local or other governmental
authority, involving a material amount which, if resolved
adversely to the interest of UBCP or its subsidiaries, would
materially affect the financial condition or operations of
UBCP or its subsidiaries on a consolidated basis and/or UBCP's
ability to perform under this Merger Agreement, and to the
best of the knowledge and belief after due inquiry of UBCP and
its executive officers, no one has asserted and no one has
reasonable or valid grounds on which it reasonably can be
expected that anyone will assert any such claims against UBCP
or its subsidiaries based upon the wrongful action or inaction
of UBCP or its subsidiaries or any of their respective
officers, directors or employees.
(e) At the time the Merger shall become effective and on such
subsequent date when the former shareholders of Southern
surrender their Southern share certificates for cancellation,
the shares of UBCP Common Stock to be received therefore will
have been duly authorized and validly issued by UBCP and will
be fully paid and nonassessable and be issued free of
preemptive rights.
(f) UBCP has timely filed all reports and registration statements
(collectively, "SEC Documents") required to be filed by it
pursuant to the Securities Act of 1933, as amended, and the
Securities Exchange Act of 1934, as amended, and such SEC
Documents complied in all material respects with the
Securities Act of 1933 and the Securities Exchange Act of 1934
and all applicable rules and regulations promulgated
thereunder (the "SEC Laws"). UBCP has delivered to Southern
copies of the Annual Report on Form 10-K filed with the
Securities and Exchange Commission by UBCP for its fiscal year
ended December 31, 1996, including exhibits and all documents
incorporated by reference therein, and the proxy materials
disseminated by UBCP to its shareholders in connection with
the 1997 Annual Meeting of Shareholders of UBCP, together with
its Quarterly Reports on Form 10-Q filed with the Securities
and Exchange Commission for the quarters ended March 31, June
30, and September 30, 1997. Such Annual and Quarterly Reports
and proxy materials and the SEC Documents do not misstate a
material fact or omit to state a material fact necessary in
order to make the statements contained therein, in light of
the circumstances under which they are made, not misleading.
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(g) Since September 30, 1997: (i) each of UBCP and its
subsidiaries has conducted business in the ordinary course,
and has preserved its corporate existence, business and
goodwill intact; (ii) there has been no material adverse
change in the assets, liabilities, business or operations of
UBCP or its subsidiaries; and (iii) there has been no damage,
destruction, loss, or which in the aggregate has had or might
reasonably be expected to have a material adverse effect on
the business or operations of UBCP or any of its subsidiaries.
(h) To the best of the knowledge after due inquiry of UBCP and its
executive officers, UBCP and UBCP's Subsidiaries have complied
with all laws, regulations and orders applicable to UBCP and
UBCP's Subsidiaries and to the conduct of their businesses,
including without limitation, all statutes, rules and
regulations pertaining to the conduct of banking activities
except for possible technical violations which together with
any penalty which results therefrom do not or will not have a
material adverse effect on the financial condition, results of
operations or business of UBCP and UBCP's Subsidiaries on a
consolidated basis. Neither UBCP nor UBCP's Subsidiaries are
in default under, and no event has occurred which, with the
lapse of time or action by a third party, could, to the best
of UBCP's knowledge after due inquiry, result in the default
under the terms of any judgment, decree, order, writ, rule or
regulation of any governmental authority or court, whether
federal, state or local and whether at law or in equity, where
the default(s) could reasonably be expected to have a material
adverse effect on the financial conditions, results of
operations or business of UBCP and UBCP's Subsidiaries on a
consolidated basis.
(i) UBCP has duly and timely filed all federal, state, county and
local income, excise, real and personal property and other tax
returns and reports (including, but not limited to, social
security, withholding, unemployment insurance, and sales and
use taxes) required to have been filed by UBCP up to the date
hereof. To the best of the knowledge and belief of UBCP all
such returns are true and correct in all material respects,
and UBCP has paid or, prior to the time the Merger shall
become effective, will pay all taxes, interest and penalties
shown on such return or reports or claimed (other than those
claims being contested in good faith) to be due to any
federal, state, county, local or other taxing authority, and
there is, and at the time the Merger shall become effective
will be, no basis for any additional claim or assessment which
might materially and adversely affect UBCP or UBCP's
Subsidiaries, and for which an adequate reserve has not been
established. To the best of its knowledge and belief, UBCP
has paid or made adequate provision in its financial
statements or its books and records for all taxes payable in
respect of all periods ending as of the date thereof. To the
best of its knowledge and belief UBCP has, or at the time the
Merger shall become effective will have, no material liability
for
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any taxes, interest or penalties of any nature whatsoever,
except for those taxes which may have arisen up to the time
the Merger shall become effective in the ordinary course of
business and are properly accrued on the books of UBCP as of
the time the Merger shall become effective.
(j) The deposits of UBCP's Subsidiaries are insured by the Federal
Deposit Insurance Corporation and UBCP's Subsidiaries has paid
all premiums and assessments with respect to such deposit
insurance.
(k) UBCP has no knowledge of any hazardous substances, hazardous
waste, pollutant or contaminant, including, but not limited
to, asbestos (except as previously disclosed to Southern in a
letter of even date herewith), PCB's or urea formaldehyde,
having been generated, released into, stored or deposited
over, upon or below (in storage tanks or otherwise) the
premises of UBCP or UBCP's Subsidiaries or any other real
property owned or leased by UBCP or UBCP's Subsidiaries, or
into any water systems on or below the surface of UBCP or
UBCP's Subsidiaries premises or any other real property owned
or leased by UBCP or UBCP's Subsidiaries in violation of any
law, regulation or requirement or in any manner which could
result in a material adverse impact on the value of the
premises or property or present a threat to human health or
the environment. As used in this Merger Agreement, the terms
"hazardous substance," "hazardous waste, "pollutant" and
"contaminant" mean any substance, waste, pollutant or
contaminant included within such terms under any applicable
Federal, state or local statute or regulation.
(l) UBCP and UBCP's Subsidiaries have in effect insurance coverage
with reputable insurers, which in respect of amounts,
premiums, types and risks insured, constitutes reasonably
adequate coverage against all risks customarily insured
against by companies comparable in size and operation to UBCP
or UBCP's Subsidiaries.
13. Representations and Warranties of Southern. Southern represents and
warrants to UBCP as follows:
(a) Southern is a corporation duly organized and validly existing
under the laws of the State of Ohio, and is a registered bank
holding company under the Bank Holding Company Act of 1956, as
amended. Southern has full power and authority (including all
licenses, franchises, permits and other governmental
authorizations which are legally required which, if not
obtained or possessed, would have a materially adverse effect
on the business and operations of Southern) to engage in the
businesses and activities now conducted by it. As of the date
of this Merger Agreement, the authorized capital stock of
Southern consists of 39,000 shares of common stock, $5 par
value, of which a total of 39,000 shares are issued and
outstanding and no shares are held as treasury shares. All of
said shares of capital stock are fully paid and nonassessable
and were not
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<PAGE> 13
issued in violation of the preemptive rights of any
shareholder. There are no outstanding options, warrants or
commitments of any kind relating to Southern's authorized but
Unicode capital stock except as disclosed in the letter to
UBCP of even date herewith.
(b) Southern has furnished to UBCP copies of the following
financial statements relating to Southern and its consolidated
subsidiaries: (i) the audited Consolidated Balance Sheets of
Southern as of December 31, 1996 and 1995 and the Consolidated
Statements of Income, Changes in Shareholders' Equity and
Statements of Cash Flows for the years then ended, together
with the notes and report of Robb, Dixon, (ii) copies of all
reports of Southern and Glouster Bank as filed with the
appropriate regulatory agencies, as of and for the years ended
December 31, 1997 and 1996 and through the date hereof. Each
of the aforementioned financial statements is true and correct
in all material respects and together present fairly in all
material respects the consolidated financial position and
results of operations of Southern as of the dates and for the
periods therein set forth in conformity with GAAP. Such
financial statements do not, as of the dates thereof, include
any material asset or omit any material liability, absolute or
contingent, or other fact, required to be included or omitted
as the case may be, by GAAP. Since December 31, 1996, there
has not been any material adverse change in the financial
condition, results of operations, or business of Southern and
Glouster Bank on a consolidated basis.
(c) The Board of Directors of Southern unanimously has authorized
execution of this Merger Agreement and agrees to unanimously
recommend the Agreement to its shareholders. Subject to the
approval by the shareholders of Southern, Southern has all
requisite power and authority to enter into this Merger
Agreement. Southern owns all of the shares of Glouster Bank
and Southern has the authority to consummate the transactions
contemplated hereby so that, provided all required corporate
and regulatory approvals are obtained and all conditions to
Southern's obligations as set forth in this Merger Agreement
are satisfied, neither the execution and delivery of this
Merger Agreement nor the consummation of the Merger will
conflict with, result in the breach of, constitute a default
under or accelerate the performance provided by the terms of
any law, or any rule or regulation of any governmental agency
or authority or any judgment, order or decree of any court or
other governmental agency to which Southern may be subject,
any contract, agreement or instrument to which Southern is a
party or by which Southern is bound or committed, or the
Articles of Incorporation or Code of Regulations of Southern
or Glouster Bank, or constitute an event which with the lapse
of time or action by a third party, could, to the best of
Southern's knowledge, result in the default under any of the
foregoing or result in the creation of any lien, charge,
encumbrance upon any of the assets, property or capital stock
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<PAGE> 14
of Southern, except, however, in the case of contracts,
agreements or instruments, such defaults, conflicts or
breaches which either (i) will be cured or waived prior to the
time the Merger becomes effective, or (ii) if not so cured or
waived would not, in the aggregate, have any material adverse
effect on the financial condition, results of operations or
business of Southern and Glouster Bank on a consolidated
basis.
(d) Except as previously disclosed to UBCP, to the best of the
knowledge after due inquiry of Southern and its executive
officers there is no litigation, action, suit, investigation
or proceeding pending or, to the best of their knowledge after
due inquiry of Southern and its executive officers, overtly
threatened, against Southern or Glouster Bank or involving any
of their respective properties or assets, at law or in equity,
before any federal, state, municipal, local or other
governmental authority, involving a material amount which, if
resolved adversely to the interest of Southern or Glouster
Bank would materially affect the financial condition or
operations of Southern and Glouster Bank on a consolidated
basis and/or Southern's ability to perform under this Merger
Agreement. To the best knowledge after due inquiry of
Southern and its executive officers, no one has asserted and
no one has reasonable or valid ground on which it reasonably
can be expected that anyone will assert any such claims
against Southern or Glouster Bank or be based upon the
wrongful action or inaction of Southern or Glouster Bank or
any of their respective officers, directors or employees.
(e) To the best of the knowledge after due inquiry of Southern and
its executive officers, Southern and Glouster Bank have good
and marketable title to all assets and properties, whether
real or personal, tangible or intangible, including without
limitation the capital stock of Glouster Bank, reflected in
Southern's Balance Sheet of December 31, 1997 or acquired
subsequent thereto (except to the extent that such assets and
properties have been disposed of for fair value in the
ordinary course of business since December 31, 1997) subject
to no liens, mortgages, security interests, encumbrances,
pledges or charges of any kind, except: (i) those items that
secure liabilities that are reflected in said Balance Sheet;
(ii) statutory liens for taxes not yet delinquent; (iii) minor
defects and irregularities in title and encumbrances which do
not materially impair the use thereof for the purposes for
which they are held; (iv) pledges or liens required to be
granted in connection with the acceptance of government
deposits or granted in connection with repurchase agreements;
and (v) easements, encumbrances, liens, mortgages and security
interests of record which do not impair the use thereof for
the purposes intended and such liens, mortgages, security
interests, encumbrances and charges are not in the aggregate,
material to the assets and properties of Southern. Southern
or Glouster Bank have as lessee the contractual right under
valid leases to
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<PAGE> 15
occupy, use, possess and control all material property leased
by Southern or Glouster Bank.
(f) To the best of the knowledge after due inquiry of Southern and
its executive officers, Southern and Glouster Bank have
complied with all laws, regulations and orders applicable to
Southern and Glouster Bank and to the conduct of their
businesses, including without limitation, all statutes, rules
and regulations pertaining to the conduct of banking
activities except for possible technical violations which
together with any penalty which results therefrom do not or
will not have a material adverse effect on the financial
condition, results of operations or business of Southern and
Glouster Bank on a consolidated basis. Neither Southern nor
Glouster Bank are in default under, and no event has occurred
which, with the lapse of time or action by a third party,
could, to the best of Southern's knowledge after due inquiry,
result in the default under the terms of any judgment, decree,
order, writ, rule or regulation of any governmental authority
or court, whether federal, state or local and whether at law
or in equity, where the default(s) could reasonably be
expected to have a material adverse effect on the financial
conditions, results of operations or business of Southern and
Glouster Bank on a consolidated basis.
(g) Except as disclosed in Southern's letter to UBCP of even date
herewith, Southern and Glouster Bank have not, since December
31, 1997 to the date hereof: (i) issued or sold any of its
capital stock or any issued any corporate debt securities
other than in the ordinary course of its banking business;
(ii) granted any option for the purchase of capital stock;
(iii) declared or set aside or paid any dividend or other
distribution in respect of its capital stock except as
permitted pursuant to Section 14(a) hereof or, directly or
indirectly, purchased, redeemed or otherwise acquired any
shares of such stock; (iv) incurred any obligation or
liability (absolute or contingent), except for obligations
reflected in this Merger Agreement, and except for obligations
or liabilities incurred in the ordinary course of business, or
mortgaged, pledged or subjected to lien or encumbrance (other
than statutory liens for taxes not yet delinquent or other
than in the ordinary course of business) any of its assets or
properties; (v) discharged or satisfied any lien or
encumbrance or paid any obligation or liability (absolute or
contingent), other than the current portion of any long term
liabilities which become due after December 31, 1997,
business, liabilities incurred in carrying out the
transactions contemplated by this Merger Agreement and
obligations and liabilities paid in the ordinary course of
business; (vi) sold, exchanged or otherwise disposed of any of
its material capital assets outside the ordinary course of
business; (vii) made any officers' salary increase or wage
increase, entered into any employment contract with any
officer or salaried employee or, instituted any employee
welfare, bonus, stock option, profit- sharing, retirement or
similar plan or
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<PAGE> 16
arrangement; (viii) suffered any damage, destruction or loss,
whether or not covered by insurance, materially and adversely
affecting its business, property or assets or waived (except
for fair consideration) any rights of value which are material
in the aggregate, considering Southern's business taken as a
whole; or (ix) entered or agreed to enter into any agreement
or arrangement granting any preferential right to purchase any
of its assets, properties or rights or requiring the consent
of any party to the transfer and assignment of any such
assets, properties or rights.
(h) Except as set forth in Southern's letter to UBCP of even date
herewith, neither Southern nor Glouster Bank is a party to or
bound by any written or, to the best of its knowledge after
due inquiry, oral: (i) employment or consulting contract which
is not terminable by Southern or Glouster Bank on 60 days or
less notice, (ii) employee bonus, deferred compensation,
pension, stock bonus or purchase, profit-sharing, retirement
or stock option plan, (iii) other employee benefit or welfare
plan, or (iv) other executory material agreements which in any
case obligate Southern or Glouster Bank to make any payment(s)
which in the aggregate exceed $5,000 per year except for
contracts terminable on 60 days' notice. All such pension,
stock bonus or purchase, profit-sharing, defined benefit and
retirement plans set forth under the caption "Qualified Plans"
in the Southern letter (hereinafter referred to collectively
as the "plans") are qualified plans under Section 401(a) of
the Internal Revenue Code and in compliance in all material
respects with ERISA. All material notices, reports and other
filings required under applicable law to be given or made to
or with any governmental agency with respect to the plans have
been timely filed or delivered where failure to file could
result in a penalty or result in disqualification of the plan.
Southern has no knowledge either of any circumstances which
would adversely affect the qualification of the plans or their
compliance with ERISA, or of any unreported "reportable event"
(as such term is defined in Section 4043(b) of ERISA) or,
except as indicated in the Southern letter to UBCP of even
date herewith, any "prohibited transaction" (as such term is
defined in Section 406 of ERISA and Section 4975(c) of the
Internal Revenue Code) which has occurred since the date on
which said sections became applicable to the plans. No such
plan is subject to the minimum funding standards set forth in
the Code and ERISA.
(i) Southern has duly filed all federal, state, county and local
income, excise, real and personal property and other tax
returns and reports (including, but not limited to, social
security, withholding, unemployment insurance, and sales and
use taxes) required to have been filed by Southern up to the
date hereof. Except as set forth in Southern's letter to UBCP
of even date herewith, to the best of the knowledge and belief
of Southern all such returns are true and correct in all
material respects, and Southern has paid or, prior to the time
the Merger shall become effective, will pay all taxes,
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<PAGE> 17
interest and penalties shown on such return or reports or
claimed (other than those claims being contested in good faith
and which have been disclosed to UBCP) to be due to any
federal, state, county, local or other taxing authority, and
there is, and at the time the Merger shall become effective
will be, no basis for any additional claim or assessment which
might materially and adversely affect Southern or Glouster
Bank and for which an adequate reserve has not been
established. To the best of its knowledge and belief,
Southern has paid or made adequate provision in its financial
statements or its books and records for all taxes payable in
respect of all periods ending as of the date thereof. To the
best of its knowledge and belief, Southern has, or at the time
the Merger shall become effective will have, no material
liability for any taxes, interest or penalties of any nature
whatsoever, except for those taxes which may have arisen up to
the time the Merger shall become effective in the ordinary
course of business and are properly accrued on the books of
Southern as of the time the Merger shall become effective.
(j) Southern has no knowledge of any hazardous substances,
hazardous waste, pollutant or contaminant, including, but not
limited to, asbestos except as disclosed to UBCP in the
Southern letter of even date herewith, PCB's or urea
formaldehyde, having been generated, released into, stored or
deposited over, upon or below (in storage tanks or otherwise)
the Glouster Bank premises or any other real property owned or
leased by Southern or Glouster Bank, or into any water systems
on or below the surface of the Glouster Bank premises or any
other real property owned or leased by Southern or the
Glouster Bank in violation of any law, regulation or
requirement or in any manner which could result in a material
adverse impact on the value of the premises or property or
present a threat to human health or the environment. As used
in this Merger Agreement, the terms "hazardous substance,"
"hazardous waste, "pollutant" and "contaminant" mean any
substance, waste, pollutant or contaminant included within
such terms under any applicable Federal, state or local
statute or regulation.
(k) Southern or Glouster Bank has in effect insurance coverage
with reputable insurers, which in respect of amounts,
premiums, types and risks insured, constitutes reasonably
adequate coverage against all risks customarily insured
against by companies comparable in size and operation to
Southern or Glouster Bank.
(l) Other than as previously disclosed to UBCP, in writing, with
respect to fees owing to Young & Associates, Inc. and Robb
Dixon relating to the Merger and other than professional fees
and disbursements of its accountants and attorneys, Southern
has not incurred and will not incur any liability for
brokerage, finders', agents', or investment bankers' fees or
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<PAGE> 18
commissions in connection with this Merger Agreement or the
transactions contemplated hereby.
14. Action by Southern Pending Effective Time. Southern agrees that from
the date of this Merger Agreement until the time the Merger shall
become effective, or until this Merger Agreement is terminated as
provided for herein, except with prior written permission of UBCP:
(a) Beginning with the date hereof and until such time as the
Merger shall become effective, Southern will not declare or
pay any dividends (cash or stock) or make any distributions
other than its ordinary and normal quarterly cash dividend
payable on dates and in amounts consistent with past practice,
at the rate of $1.20 per share per year for the year ended
December 31, 1998.
(b) Southern will not issue, sell, grant any option for, or
acquire for value any shares of its capital stock or otherwise
effect any change in connection with its capitalization.
(c) Except as set forth in or contemplated by this Merger
Agreement, Southern and Glouster Bank will carry on their
respective businesses in substantially the same manner as on
the date hereof, keep in full force and effect insurance
comparable in amount and scope of coverage to that now
maintained by it and use its best efforts to maintain and
preserve its business organization intact.
(d) Except as specifically set forth in Southern's letter to UBCP
of even date herewith, Southern and Glouster Bank will not:
(i) enter into any transaction other than in the ordinary
course of business or incur or agree to incur any obligation
or liability except liabilities incurred and obligations
entered into in the ordinary course of business; (ii) change
Glouster Bank's lending, investment, liability management and
other material banking policies in any material respect; (iii)
except as committed for adjustment as of the date hereof and
consistent with prior practice, grant any general or uniform
increase in the rates of pay of employees; (iv) incur or
commit to any capital expenditures other than in the ordinary
course of business (which in no event shall include the
establishment of new branches and such other facilities) or
any capital expenditures for any purpose which exceed $5,000
in the aggregate, (v) except as provided in Section 9 hereof,
merge into, consolidate with or sell its assets to any other
corporation or person, or permit any other corporation to be
merged or consolidated with it or acquire all of the assets of
any other corporation or person, of (vi) except with the
express written consent of UBCP sell, transfer or otherwise
dispose of any asset which has a book or market value,
whichever is greater, of $5,000.
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(e) Southern will not change its or Glouster Bank's methods of
accounting in effect at December 31, 1997 except as required
by changes in generally accepted accounting principles and
concurred in by Southern's independent auditors, and except
for the adjustments required as of December 31, 1997 pursuant
to paragraph 7(a) hereof, or change any of its methods of
reporting income and deductions for Federal income tax
purposes from those employed in the preparation of Southern's
Federal income tax returns for the taxable year ending
December 31, 1996, except for changes required by law.
(f) Southern will afford UBCP, its officers and other authorized
representatives, subject to the confidentiality requirements
of Section 10(d) hereof, such access to all books, records,
tax returns, leases, contracts and documents of Southern or
Glouster Bank and will furnish to UBCP such information with
respect to the assets and business of Southern and Glouster
Bank as UBCP may from time to time reasonably request in
connection with this Merger Agreement and the transactions
contemplated hereby.
(g) Southern will promptly furnish UBCP with copies of all monthly
interim financial statements of Southern as they become
available, and keep UBCP fully informed concerning all
developments which in the opinion of Southern may have a
material effect upon the business, properties or condition
(either financial or otherwise) of Southern.
(h) Southern will, and will cause Glouster Bank to, maintain
compliance with any and all regulatory agreements to which it
or they are a party with any federal or state banking
regulatory agencies.
(i) Southern shall use its best efforts to preserve intact the
current business organization of Southern and Glouster Bank,
keep available the services of the current officers,
employees, and agents of Southern and Glouster Bank, and
maintain the relations and good will with customers,
depositors, landlords, employees, agents, and others having
business relationships with each of them.
(j) Southern shall cause Glouster Bank to confer with UBCP or
UBCP's authorized representative concerning operational
matters of a material nature and will obtain UBCP prior
written consent, which shall not be unreasonably withheld,
before it: (i) engages in any lending activities other than
in the Ordinary Course of Business; (ii) makes any 1-4 family
unit residential real estate loans in excess of $100,000 to
any borrower; (iii) makes any consumer installment or
construction loans in excess of $30,000 to any borrower; (iv)
extends any equity lines of credit in excess of $50,000 to any
borrower; or (v) makes any commercial loans in excess of
$50,000 to any borrower (taking into account existing
borrowings).
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<PAGE> 20
15. Action by UBCP Pending Effective Time. UBCP agrees that from the date
of this Agreement until the time the Merger shall become effective or
until this Merger Agreement is terminated as provided for herein:
(a) UBCP will carry on its business in substantially the same
manner as heretofore except as otherwise set forth in or
contemplated by this Merger Agreement, and UBCP will keep in
full force and effect insurance comparable in amount and scope
of coverage to that now maintained by it and use its best
efforts to maintain and preserve its business organization
intact. Southern acknowledges that, in the ordinary course of
its business as a bank holding company, UBCP from
time-to-time, enters into an agreement(s) to acquire by
merger, stock purchase or like means, another financial
institution or its holding company.
(b) UBCP will not change its methods of accounting in effect at
December 31, 1997, except as required by changes in generally
accepted accounting principles as concurred in by UBCP's
independent auditors, or change any of its methods of
reporting income and deductions for Federal income tax
purposes from those employed in the preparation of the Federal
income tax returns of UBCP's Subsidiaries for the taxable year
ending December 31, 1996, except for changes required by law
or take any action which could jeopardize the tax free nature
of the Merger or the pooling of interests accounting treatment
for the Merger.
(c) UBCP will promptly furnish Southern with copies of press
releases, interim financial statements of UBCP and all
reports, schedules and statements filed by or delivered to
UBCP pursuant to the Securities and Exchange Act of 1934 and
the rules and regulations promulgated thereunder, as they
become available.
(d) UBCP will afford Southern, its officers and other authorized
representatives, subject to the confidentiality requirements
of Section 10(d) hereof, such access to all books, records,
tax returns, leases, contracts and documents of UBCP and will
furnish to Southern such information with respect to the
assets and business of UBCP as Southern may from time to time
reasonably request in connection with this Merger Agreement
and the transactions contemplated hereby.
16. Conditions to Obligations of UBCP. The obligations of UBCP under this
Merger Agreement are subject, unless waived by UBCP, to the
satisfaction of the following conditions on or prior to the time the
Merger shall become effective:
(a) Prior to the time the Merger shall become effective, UBCP
shall not have been deprived of adequate opportunity to
conduct such review and examination of the business,
properties, and condition (financial or
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<PAGE> 21
otherwise) of Southern and Glouster Bank as UBCP shall have
deemed prudent, and such review and examination shall not have
disclosed matters which are inconsistent in any material
respect with any of the representations and warranties of
Southern contained in this Merger Agreement.
(b) There shall not have been any material adverse change or
discovery of a condition or the occurrence of an event which
has or is likely to result in such a material adverse change,
in the financial condition, aggregate net assets,
shareholders' equity, business or operating results of
Southern on a consolidated basis from December 31, 1997 to the
time the Merger shall become effective.
(c) All representations by Southern contained in this Merger
Agreement shall be true in all material respects immediately
prior to the time the Merger shall become effective as though
such representations were made at and as of said date, except
for changes contemplated by the Merger Agreement and except
also for representations as of a specified time other than the
time the Merger shall become effective, which shall be true in
all material respects at such specified time.
(d) UBCP shall have received the opinion of legal counsel for
Southern, dated the time the Merger shall become effective,
substantially to the effect set forth in Exhibit A hereto.
(e) Southern shall have performed or satisfied in all material
respects all agreements and conditions required by this Merger
Agreement to be performed or satisfied by it at or prior to
the time the Merger shall become effective.
(f) At the time the Merger shall become effective, no suit, action
or proceeding shall be pending or overtly threatened before
any court or other governmental agency of the federal or state
government in which it is sought to restrain or prohibit the
consummation of the Merger, and no other suit, action or
proceeding shall be pending or overtly threatened and no
liability or claim shall have been asserted against Southern
or Glouster Bank which UBCP shall in good faith determine,
with advice of counsel: (i) has a reasonable likelihood of
being successfully prosecuted and (ii) if successfully
prosecuted, would materially and adversely affect the
financial condition, results of operations or shareholders'
equity of Southern on a consolidated basis.
(g) The number of shares as to which shareholders of Southern have
exercised their dissenters' rights of appraisal pursuant to
the provisions of Section 1701.85 of the Ohio Revised Code
does not exceed 10 percent (10%) of the outstanding shares of
Southern Common Stock.
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<PAGE> 22
(h) Southern shall have furnished UBCP certificates, signed on its
behalf by the Chairman or President and the Secretary or an
Assistant Secretary of Southern and dated the time the Merger
shall become effective, to the effect that to the best of
their knowledge, after due inquiry, the conditions described
in Paragraphs (b), (c), (e) and (f) of this Section 16 have
been fully satisfied.
(i) Austin Associates, Inc. ("AAI") shall have issued its written
fairness opinion stating that the terms of the Merger are fair
and equitable to the shareholders of UBCP from a financial
perspective. Such written fairness opinion shall be: (a) in
form and substance reasonably satisfactory to UBCP and (b)
confirmed by AAI as of the time the Merger shall become
effective that the terms of the Merger continue to be fair and
equitable to the shareholders of UBCP from a financial
perspective.
(j) UBCP shall have received assurances, satisfactory to it, that
the Merger will be accounted for as a pooling of interests
transaction.
(k) UBCP shall have been afforded the opportunity to conduct a
phase I environmental audit of any real property owned by
Southern or its subsidiaries. In the event a matter is
discovered which if known by Southern as of the date of this
Agreement would have violated the representation contained in
paragraph 13(j) hereof, involves an amount in excess of
$50,000, and Southern shall fail to remedy such matter to the
reasonable satisfaction of UBCP, then UBCP may terminate this
Agreement and neither party shall thereafter have any
liability resulting from this Agreement or the transactions
contemplated thereby. UBCP shall complete any phase I
examination, immediately after the date of this Agreement, but
in any event shall complete such within 90 days of this
Agreement.
(l) The members of the Board of Directors of Southern shall have
executed this Agreement stating that they shall vote their
shares of Southern in favor of the Merger and shall recommend
approval of the Merger to the Southern shareholders.
(m) Certain loans (namely: commercial loan numbers
71471, and 72936, and 4101701810) shall be paid in full
without loss to Glouster Bank.
17. Conditions to Obligations of Southern. The obligations of Southern
under this Merger Agreement are subject, unless waived by Southern, to
the satisfaction on or prior to the time the Merger shall become
effective of the following conditions:
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<PAGE> 23
(a) There shall not have been any material adverse change or
discovery of a condition or the occurrence of an event which
has or is likely to result in such a material adverse change,
in the financial condition, aggregate net assets,
shareholders' equity, business, or operating results of UBCP
on a consolidated basis from December 31, 1997 to the time the
Merger shall become effective.
(b) All representations and warranties by UBCP contained in this
Merger Agreement shall be true in all material respects
immediately prior to the time the Merger shall become
effective as though such representations and warranties were
made at and as of said date, except for changes contemplated
by this Merger Agreement, and except also for representations
as of a specified time other than the time the Merger shall
become effective, which shall be true in all material respects
at such specified time.
(c) Southern shall have received the opinion of Counsel for UBCP
dated the time the Merger shall become effective substantially
to the effect set forth in Exhibit B hereto.
(d) UBCP shall have performed or satisfied in all material
respects all agreements and conditions required by this Merger
Agreement to be performed or satisfied by it at or prior to
the time the Merger shall become effective.
(e) At the time the Merger shall become effective, no suit, action
or proceeding shall be pending or overtly threatened before
any court or other governmental agency of the federal or state
government in which it is sought to restrain, prohibit or set
aside consummation of the Merger and no other suit, action or
proceeding shall be pending or overtly threatened and no
liability or claim shall have been asserted against UBCP or
UBCP's Subsidiaries which Southern shall in good faith
determine, with advice of counsel: (i) has a reasonable
likelihood of being successfully prosecuted and (ii) if
successfully prosecuted, would materially and adversely affect
the financial condition, results of operations or
shareholders' equity of UBCP, on a consolidated basis.
(f) UBCP shall have furnished Southern a certificate, signed by
the Chairman or President and by the Secretary or Assistant
Secretary of UBCP and dated the time the Merger shall become
effective to the effect that to the best of their knowledge
after due inquiry the conditions described in Paragraphs (a),
(b), (d) and (e) of this Section 17 have been fully satisfied.
(g) Prior to the time the Merger shall become effective, Southern
shall not have been deprived of adequate opportunity to
conduct such review and examination of the business,
properties and condition (financial or
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otherwise) of UBCP and its subsidiaries as Southern shall have
deemed prudent, and such review and examination shall not have
disclosed matters which are inconsistent in any material
respect with any of the representations and warranties of UBCP
contained in this Merger Agreement.
(h) Young and Associates ("Young") or such other financial advisor
acceptable to Southern shall have issued its written fairness
opinion stating that the terms of the Merger are fair and
equitable to the shareholders of Southern from a financial
perspective. Such written fairness opinion shall be: (a) in
form and substance reasonably satisfactory to Southern; (b)
dated as of a date not later than the mailing date of the
Proxy Statement/Prospectus relating to the Merger to be mailed
to Southern shareholders; (c) included in the Proxy
Statement/Prospectus; and (d) confirmed by Young as of the
time the Merger shall become effective that the terms of the
Merger continue to be fair and equitable to the shareholders
of Southern from a financial perspective.
(i) The shares of UBCP to be issued under the terms of this
Agreement shall be approved for listing on the NASDAQ Small
Cap Market and no suspension or halt of any kind, (other than
such that may be applicable to the market generally) shall be
in effect or imposed on the shares of UBCP.
18. Conditions to Obligations of All Parties. In addition to the
provisions of Sections 16 and 17 hereof, the obligations of UBCP and
Southern to cause the transactions contemplated herein to be
consummated shall be subject to the satisfaction of the following
conditions on or prior to the time the Merger shall become effective:
(a) The parties hereto shall have received all necessary approvals
of governmental agencies and authorities of the transactions
contemplated by this Merger Agreement and each of such
approvals shall remain in full force and effect at the time
the Merger shall become effective and such approvals and the
transactions contemplated thereby shall not have been
contested by any federal or state governmental authority by
formal proceeding, or contested by any other third party by
formal proceeding which the Board of Directors of the party
asserting a failure of a condition under this Section 18(a)
shall in good faith determine, with the advice of counsel:
(i) has a reasonable likelihood of being successfully
prosecuted and (ii) if successfully prosecuted, would
materially and adversely affect the benefits hereunder
intended for such party. It is understood that, if any
contest as aforesaid is brought by formal proceedings, UBCP
may, but shall not be obligated to, answer and defend such
contest. UBCP shall notify Southern promptly upon receipt of
all necessary governmental approvals.
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<PAGE> 25
(b) The registration statement required to be filed by UBCP
pursuant to Section 10(c) of this Merger Agreement shall have
become effective by an order of the Securities and Exchange
Commission, the shares of UBCP Common Stock to be exchanged in
the Merger shall have been qualified or exempted under all
applicable state securities laws, and there shall have been no
stop order issued or threatened by the Securities and Exchange
Commission that suspends or would suspend the effectiveness of
the registration statement, and no proceeding shall have been
commenced, pending or overtly threatened for such purpose.
(c) This Merger Agreement shall have been duly adopted, ratified
and confirmed by the requisite affirmative votes of the
shareholders of Southern and UBCP.
(d) UBCP and Southern shall have received the opinion and there
shall exist as of, at or immediately prior to the time the
Merger shall become effective no facts or circumstances which
would render such opinion inapplicable in any respect to the
transactions to be consummated hereunder of Werner & Blank
Co., L.P.A. substantially to the effect that:
(i) The statutory merger of Southern with and into UBCP
will constitute a reorganization within the meaning
of Section 368(a)(1)(A) of the Internal Revenue Code;
(ii) No taxable gain or loss will be recognized by
Southern or UBCP as a consequence of the transactions
herein contemplated;
(iii) No taxable gain or loss will be recognized by the
shareholders of Southern on the exchange of their
shares of Southern Common Stock for shares of UBCP
Common Stock (disregarding for this purpose any cash
received for fractional share interests to which they
may be entitled);
(iv) The federal income tax basis of the UBCP Common Stock
received by the shareholders of Southern Common Stock
for their shares of Southern Common Stock will be the
same as the federal income tax basis of the Southern
Common Stock surrendered in exchange therefor; and
(v) The holding period of the UBCP Common Stock received
by a shareholder of Southern for his shares of
Southern Common Stock will include the period for
which the Southern Common Stock exchanged therefor
was held, provided the exchanged Southern Common
Stock was held as a capital asset by such shareholder
on the date of the exchange.
19. Nonsurvival of Representations and Warranties. The respective
representations and warranties of UBCP and Southern set forth in
Sections 12 and 13 shall not survive the time the Merger shall become
effective.
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<PAGE> 26
20. Governing Law. This Merger Agreement shall be construed and
interpreted according to the applicable laws of the State of Ohio.
21. Assignment. This Merger Agreement and all of the provisions hereof
shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and permitted assigns, but neither
this Merger Agreement nor any of the rights, interests, or obligations
hereunder shall be assigned by either of the parties hereto without
the prior written consent of the other party.
22. Satisfaction of Conditions; Termination.
(a) UBCP agrees to use its best effort to obtain satisfaction of
the conditions insofar as they relate to UBCP, and Southern
agrees to use its best efforts to obtain the satisfaction of
the conditions insofar as they relate to Southern. If any
condition to the obligations of UBCP set forth in Section 16
or 18 is not substantially satisfied at the time or times
contemplated thereby and such condition is not waived by UBCP,
or if any condition to the obligations of Southern set forth
in Section 17 or 18 is not substantially satisfied at the time
or times contemplated thereby and such condition is not waived
by Southern, or if at any time prior to the time the Merger
shall become effective, it shall become reasonably certain
that such condition will not be substantially satisfied and
such condition is not waived by UBCP or Southern, as the case
may be, either UBCP or Southern may terminate this Merger
Agreement by written notice to the other party after the
expiration of fifteen (15) days written notice to the other
party during which time such other party shall have an
opportunity to cure such defect in said condition. This
Merger Agreement may be terminated and abandoned (either
before or after the meetings of shareholders contemplated
hereby) by mutual written consent of UBCP and Southern
authorized by their respective Boards of Directors. In the
event of such termination caused otherwise than by breach of
this Merger Agreement by any of the parties hereto, this
Merger Agreement shall cease and terminate, the acquisition of
Southern as provided herein shall not be consummated, and
neither UBCP nor Southern shall have any further liability
under this Merger Agreement of any nature whatever, including
any liability for damages. In the event this Merger Agreement
is terminated, the duties of both parties with respect to
confidential information set forth in Sections 10(d) shall
survive any such termination. In addition to the other
grounds for termination of this Merger Agreement set forth
herein, this Merger Agreement can be terminated by written
notice by either party to the other, in each case authorized
by its Board of Directors, if the Merger shall not have been
consummated by December 31, 1998 or the date of such notice,
whichever is later.
(b) If termination of this Merger Agreement shall be judicially
determined to have been caused by breach of this Merger
Agreement, then, in addition to other remedies at law or
equity for breach of this Merger Agreement, the
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<PAGE> 27
party so found to have breached this Merger Agreement shall
indemnify the other parties for their respective costs, fees
and expenses of its counsel, accountants and other experts and
advisors as well as fees and expenses incident to negotiation,
preparation and execution of this Merger Agreement and related
actions and its shareholders' meetings and actions.
23. Waivers Amendments. Any of the provisions of this Merger Agreement
may be waived at any time by the party which is, or the shareholders
of which are, entitled to the benefit thereof, by such party. This
Merger Agreement may be amended or modified in whole or in part by an
agreement in writing executed in the same manner (but not necessarily
by the same person) as this Merger Agreement and which makes reference
to this Merger Agreement, pursuant to a resolution, adopted by the
Boards of Directors of the respective parties, provided, however, such
amendment or modification may be made in this manner by the respective
Boards of Directors of UBCP and Southern at any time prior to a
favorable vote of such party's shareholders, but may be made after a
favorable vote by the shareholders of such party, only if, in the
opinion of its Board of Directors, such amendment or modification will
not have any material adverse effect on the benefits intended under
this Merger Agreement for the shareholders of such party and will not
require resolicitation of any proxies from such shareholders or
further shareholder approval is obtained.
24. Entire Agreement. This Agreement supersedes any other agreement,
whether written or oral, that may have been made or entered into by
UBCP and Southern or by any officer or officers of such parties
relating to the acquisition of the business or the capital stock of
Southern by UBCP. Except for the letters specified in this Merger
Agreement and of even date herewith, this Agreement and the Exhibits
thereto constitute the entire agreement by the parties, and there are
no agreements or commitments except as set forth herein and therein.
25. Captions; Counterparts. The captions in this Merger Agreement are for
convenience only and shall not be considered a part of or affect the
construction or interpretation of any provision of this Merger
Agreement. This Merger Agreement may be executed in several
counterparts, each of which shall constitute one and the same
instrument.
26. Notices. All notices and other communications hereunder shall be
deemed to have been duly given if forwarded by a nationally recognized
overnight courier service. All notices and other communications
hereunder given to any party shall be communicated to the remaining
party to this Merger Agreement by mail in the same manner as herein
provided.
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(a) If to UBCP, to:
Mr. James W. Everson
Chairman, President and CEO
UBCP Bancorp, Inc.
P.O. Box 10
201 South Fourth Street,
Martins Ferry, OH 43935
With copies to:
Martin D. Werner, Esq.
Werner & Blank Co., L.P.A.
7205 W. Central Avenue
Toledo, Ohio 43617
(b) If to Southern, to:
Mr. L. E. Richardson, Jr.
Chairman, President and CEO
Southern Ohio Community Bancorporation, Inc.
88 High Street
Glouster, OH 45732-0127
With copies to:
Mr. Jeff Robb
Robb, Dixon
1205 Weaver Drive
Granville, OH 43023
And,
Mr. Gary Young
Young & Associates, Inc.
P.O. Box 711
121 E. Main Street
Kent, OH 44240
and,
Paul J. Gerig, Esq.
Gerig and Gerig
Attorneys At Law
P.O. Box 268
3 West Stimson Avenue
Athens, OH 45701
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27. Undertakings of Affiliates. Each of UBCP and Southern shall cause the
following:
(A) Southern shall cause to be received, an
undertaking in writing from each "affiliate" of
Southern within the meaning of Rule 145 of the
Securities and Exchange Commission pursuant to the
Securities Act of 1933, in each case in form and
substance satisfactory to counsel for UBCP, to the
effect that: (i) so long as UBCP continues to file
all "current public information" concerning UBCP,
any disposition made by such person of any share
of UBCP Common Stock received by such person
pursuant to this Merger Agreement shall be made
within the limits and in accordance with the
applicable provisions of said Rule 145, as such
Rule may be amended from time to time, and (ii)
such person will not sell, assign or transfer any
of such UBCP Common Stock until UBCP shall have
published financial results including the combined
operations of UBCP and Southern for a period of at
least 30 days following the time the Merger shall
become effective.
(B) UBCP shall cause each of its affiliates, as
defined in (A) above, to undertake that such
person will not sell, assign, or transfer any UBCP
Common Stock until UBCP shall have published
financial results including the combined
operations of UBCP and Southern for a period of at
least 30 days following the time the Merger shall
become effective.
28. Publicity. The parities acknowledge that UBCP is subject to the
informational reporting requirements of the Securities and Exchange
Act of 1934 and the rules of the Securities and Exchange Commission
promulgated thereunder. UBCP and Southern agree to consult with and
obtain the consent of the other, prior to any media release or other
public disclosures as to the matters covered by this Agreement, except
as may be required by law.
{SIGNATURES ON FOLLOWING PAGE}
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IN WITNESS WHEREOF, this Merger Agreement has been executed the day
and year first above written.
ATTEST: United Bancorp, Inc.
By: /s/ Randall M. Greenwood By: /s/ James W. Everson
------------------------------- ------------------------------------
Randall M. Greenwood, James W. Everson
Vice President & CFO Chairman, President and CEO
ATTEST: Southern Ohio
Community Bancorporation, Inc.
By: /s/ Theodore R. Swallow By: /s/ L.E. Richardson, Jr.
------------------------------- ------------------------------------
Theodore R. Swallow, L.E. Richardson, Jr.
Vice President & Treasurer Chairman, President and CEO
DIRECTORS UNDERTAKING
Pursuant to the provisions of Sections 16(l) and 27 hereof, each of the
undersigned, being a Director of Southern, hereby agrees to vote shares of
Southern owned by them or over which they exercise voting control in favor of
the Merger, to support the Merger and to make the undertakings set forth in
Section 27.
__________________________________ ______________________________________
__________________________________ ______________________________________
__________________________________ ______________________________________
__________________________________ ______________________________________
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EXHIBIT A
__________, 1998
United Bancorp, Inc.
201 South Fourth Street
Martins Ferry, OH 43935
Ladies and Gentlemen:
We have acted as special counsel to Southern Ohio Community
Bancorporation, Inc. ("Southern"), an Ohio corporation and bank holding
company, solely in connection with certain transactions contemplated by the
Agreement of Merger (the "Agreement of Merger"), dated _______, 1998, by and
between Southern and United Bancorp, Inc. ("UBCP"), an Ohio corporation and
bank holding company.
This opinion is furnished to you pursuant to Section ____ of the
Merger Agreement.
You have requested our opinion regarding certain matters in connection with the
Agreement. In our capacity as special counsel for Southern and Glouster Bank,
we have examined the originals or copies of such certificates, documents and
corporate records upon which we have relied regarding our opinion expressed
below. We have assumed the genuineness of all signatures, the authenticity of
all items submitted to us as certified or photostatic copies and the
authenticity of the originals of such copies. We have further assumed the due
authorization of such documents by all parties other than Southern and Glouster
Bank and the taking of all requisite action respecting such documents, the due
execution and delivery of such documents by each party and have additionally
assumed that all agreements are the valid and binding agreement of all parties
to such agreements, other than Southern and Glouster Bank.
Wherever a statement herein is qualified by "to the best of our knowledge," or
a similar phrase, it is intended to indicate that, during the course of our
representation of Southern and Glouster Bank, no information has been provided
to those partners in this firm who have had substantive involvement in
rendering legal services in connection with the representation described in the
introductory paragraph of this opinion letter that would give us knowledge of
the inaccuracy of such statement.
This Opinion Letter is governed by, and shall be interpreted in accordance
with, the Legal Opinion Accord (the "Accord") of the ABA Section of Business
Law (1991). As a consequence, it is subject to a number of qualifications,
exceptions, definitions, limitations on coverage and other limitations, all as
more particularly described in the Accord, and this Opinion Letter should be
read in conjunction therewith. The law
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<PAGE> 32
addressed by this opinion is limited to the law of the State of Ohio and the
federal law of the United States of America.
The opinions hereinafter expressed are subject to the following qualifications,
notwithstanding anything herein to the contrary:
(a) Our opinions in paragraphs (1) and (4) below as to the valid
existence Southern and Glouster Bank are based solely upon certificates from
public officials as to valid existence, copies of which certificates are
attached hereto.
(b) Our opinions below are limited to the matters expressly set
forth in this opinion letter, and no opinion is to be implied or may be
inferred beyond the matters expressly so stated. Without limiting the
foregoing, we express no opinion as to the antifraud provisions of federal and
state securities laws.
(c) We disclaim any obligation to update this opinion letter for
events occurring after the date of this opinion letter.
(d) Our opinions below are limited to the effect of the laws of
Ohio and the federal laws of the United States of America. We express no
opinion with respect to the effect of the laws of any other jurisdiction on the
transactions contemplated by the Agreement.
(e) In rendering this opinion, we have relied as to all matters of
fact on certificates or responsible officers of Southern and Glouster Bank and
of public officials, copies of which are attached hereto.
Based upon and subject to the foregoing and in reliance thereon, and
subject to the assumptions, exceptions and qualifications set forth herein, it
is our opinion that:
1. Southern is a corporation validly existing and in good standing under the
laws of the State of Ohio and has the requisite corporate power and
authority to own its properties and to carry on the business in which it is
now engaged. Southern owns all of the capital stock of Glouster Bank free
and clear of all liens and security interests.
2. All necessary corporate proceedings of Southern have been duly taken to
authorize the execution, delivery and performance of the Agreement by
Southern and the consummation of the transactions contemplated by the
Agreement, subject in all events to any conditions stated in said
Agreement. The Agreement constitutes the legal, valid and binding
obligation of Southern, enforceable in accordance with its terms, except:
a. as such enforceability may be limited by bankruptcy, insolvency,
reorganization, fraudulent conveyance or similar laws affecting
creditors' rights; and
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<PAGE> 33
b. that the remedy of specific performance and injunctive and other
forms of equitable relief are subject to certain equitable
defenses and to the discretion of the court before which any
proceedings may be brought.
3. The execution, delivery and performance of the Agreement by Southern will
not violate or result in a breach of any term of Southern's Articles of
Incorporation or Code of Regulations, or violate, result in a breach of, or
constitute a default under any term of any material agreement known to us
to which Southern is a party.
4. Glouster Bank is a banking corporation validly existing under the laws of
the State of Ohio, and has the requisite corporate power and authority to
own its properties and carry on the business in which it is now engaged.
5. The authorized capital stock of Southern consists of _________, shares of
common stock without par value 39,000 of which are outstanding To our
knowledge, there are no outstanding options, warrants, or other rights to
acquire, or securities convertible into any capital stock of Southern. The
outstanding shares of common stock of Southern validly authorized and
issued, and non-assessable, and not, to the best of our knowledge, issued
in violation of the pre-emptive rights of any person.
6. To our knowledge, except as disclosed herein, there is no litigation,
action, suit, investigation or proceeding pending or, to the best of our
knowledge after due inquiry of Southern and its executive officers, overtly
threatened against or affecting Southern or involving any of its respective
properties or assets, at law or in equity, before any federal, state,
municipal, local or other governmental authority.
7. All consents or approvals of any regulatory authority having jurisdiction
over Southern or its subsidiaries that are required to be obtained in
connection with the Merger and the transactions contemplated by the
Agreement have been obtained.
This opinion is solely for the benefit of the addressee hereof and may not be
relied upon by any other person or party or in any other context without our
prior written consent. This opinion is delivered as of the date hereof, and we
expressly disclaim any undertaking to update it.
Very truly yours,
____________________
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EXHIBIT B
____________, 1998
Southern Ohio Community Bancorporation, Inc.
88 High Street
Glouster, OH 45732-0127
Re: United Bancorp, Inc.
Gentlemen:
We have acted as special counsel to United Bancorp, Inc. ("UBCP") an Ohio
corporation, in connection with the contemplated Merger Agreement dated ______,
1998 (the "Agreement") between Southern Ohio Community Bancorporation, Inc.
("Southern") and UBCP. This Opinion Letter is rendered to you pursuant to
Section _______ of the Agreement. Capitalized terms not otherwise defined
herein shall have the meanings ascribed to them in the Agreement.
You have requested our opinion regarding certain matters in connection with the
Agreement. In our capacity as special counsel for UBCP and UBCP's
Subsidiaries, we have examined the originals or copies of such certificates,
documents and corporate records upon which we have relied regarding our opinion
expressed below. We have assumed the genuineness of all signatures, the
authenticity of all items submitted to us as certified or photostatic copies
and the authenticity of the originals of such copies. We have further assumed
the due authorization of such documents by all parties other than UBCP and
UBCP's Subsidiaries and the taking of all requisite action respecting such
documents, the due execution and delivery of such documents by each party and
have additionally assumed that all agreements are the valid and binding
agreement of all parties to such agreements, other than UBCP and UBCP's
Subsidiaries.
Wherever a statement herein is qualified by "to the best of our knowledge," or
a similar phrase, it is intended to indicate that, during the course of our
representation of UBCP and UBCP's Subsidiaries, no information has been
provided to those partners in this firm who have had substantive involvement in
rendering legal services in connection with the representation described in the
introductory paragraph of this opinion letter that would give us knowledge of
the inaccuracy of such statement.
This Opinion Letter is governed by, and shall be interpreted in accordance
with, the Legal Opinion Accord (the "Accord") of the ABA Section of Business
Law (1991). As a consequence, it is subject to a number of qualifications,
exceptions, definitions, limitations on coverage and other limitations, all as
more particularly described in the Accord, and this Opinion Letter should be
read in conjunction therewith. The law addressed by this opinion is limited to
the law of the State of Ohio and the federal law of the United States of
America.
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<PAGE> 35
The opinions hereinafter expressed are subject to the following qualifications,
notwithstanding anything herein to the contrary:
(a) Our opinions in paragraphs (1) and (4) below as to the valid
existence of UBCP and UBCP's Subsidiaries are based solely upon certificates
from public officials as to valid existence, copies of which certificates are
attached hereto.
(b) Our opinions below are limited to the matters expressly set
forth in this opinion letter, and no opinion is to be implied or may be
inferred beyond the matters expressly so stated. Without limiting the
foregoing, we express no opinion as to the antifraud provisions of federal and
state securities laws.
(c) We disclaim any obligation to update this opinion letter for
events occurring after the date of this opinion letter.
(d) Our opinions below are limited to the effect of the laws of
Ohio, the federal laws of the United States of America, and the state
securities "blue sky" laws of jurisdictions where shareholders of Southern
reside. We express no opinion with respect to the effect of the laws of any
other jurisdiction on the transactions contemplated by the Agreement.
(e) In rendering this opinion, we have relied as to all matters of
fact on certificates or responsible officers of UBCP and UBCP's Subsidiaries
and of public officials, copies of which are attached hereto.
Based upon and subject to the foregoing and in reliance thereon, and
subject to the assumptions, exceptions and qualifications set forth herein, it
is our opinion that:
1. UBCP is a corporation validly existing and in good standing under the laws
of the State of Ohio and has the requisite corporate power and authority to
own its properties and to carry on the business in which it is now engaged.
UBCP owns all of the capital stock of UBCP's Subsidiaries free and clear of
all liens and security interests.
2. All necessary corporate proceedings of UBCP have been duly taken to
authorize the execution, delivery and performance of the Agreement by UBCP
and the consummation of the transactions contemplated by the Agreement,
subject in all events to any conditions stated in said Agreement. The
Agreement constitutes the legal, valid and binding obligation of UBCP,
enforceable in accordance with its terms, except:
a. as such enforceability may be limited by bankruptcy, insolvency,
reorganization, fraudulent conveyance or similar laws affecting
creditors' rights; and
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<PAGE> 36
b. that the remedy of specific performance and injunctive and other
forms of equitable relief are subject to certain equitable
defenses and to the discretion of the court before which any
proceedings may be brought.
3. The execution, delivery and performance of the Agreement by UBCP will not
violate or result in a breach of any term of UBCP's Articles of
Incorporation or Code of Regulations, or violate, result in a breach of, or
constitute a default under any term of any material agreement known to us
to which UBCP is a party.
4. UBCP's Subsidiaries are state banking corporations validly existing under
the laws of the Ohio and each has the requisite corporate power and
authority to own its properties and carry on the business in which it is
now engaged.
5. The authorized capital stock of UBCP consists of 10,000,000, shares of
common of $1 par value per share of which ______________ are outstanding as
of the date of the Agreement. The outstanding shares of common stock of
UBCP are, and the shares to be issued in accordance with the Agreement will
be, validly authorized and issued, and non-assessable.
6. To our knowledge, except as disclosed herein, there is no litigation,
action, suit, investigation or proceeding pending or, to the best of our
knowledge after due inquiry of UBCP and its executive officers, overtly
threatened against or affecting UBCP or involving any of its respective
properties or assets, at law or in equity, before any federal, state,
municipal, local or other governmental authority.
7. All consents or approvals of any regulatory authority having jurisdiction
over UBCP or its subsidiaries that are required to be obtained in
connection with the Merger and the transactions contemplated by the
Agreement have been obtained.
8. The Registration Statement on Form S-4 filed by UBCP pursuant to the
Agreement has become effective and no stop order revoking such
effectiveness has been issued or has been threatened. UBCP has complied,
in all material respects, with the state securities "blue sky" laws of the
jurisdictions where Southern shareholders reside in connection with the
issuance of the UBCP Common Stock in connection with the Merger.
This opinion is solely for the benefit of the addressee hereof and may not be
relied upon by any other person or party or in any other context without our
prior written consent. This opinion is delivered as of the date hereof, and we
expressly disclaim any undertaking to update it.
Very truly yours,
/s/ Werner & Blank Co. L.P.A.
36
