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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
SEPTEMBER 27, 1999
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(Date of earliest event reported)
Independent Bank Corp.
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(Exact name of registrant as specified in its charter)
MASSACHUSETTS 1-9047 04-2870273
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(State or other jurisdiction (Commission File Number) IRS Employer
of incorporation) Identification No.
288 UNION STREET, ROCKLAND, MASSACHUSETTS 02370
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(Address of principal executive offices) (Zip Code)
(781) 878-6100
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(Registrant's telephone number, including area code)
NOT APPLICABLE
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(Former name, former address and former fiscal year, if
changed since last report)
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ITEM 5. OTHER EVENTS
On September 24, 1999, Independent Bank Corp. (the "Company") and its sole
banking subsidiary, Rockland Trust Company, entered into a purchase and
assumption agreement with Fleet Financial Group, Inc., Fleet National Bank and
BankBoston, N.A., to acquire 12 Massachusetts branches totaling $269 million in
deposits and $37 million in consumer and SBA loans. In addition, the Company
will purchase approximately $113 million of commercial real estate loans at par
from BankBoston, related to its Small Business Banking Developmental Real Estate
portfolio. The acquisitions result from the divestiture of Fleet branches after
its merger with BankBoston. The transaction is contingent on regulatory
approvals and the raising of approximately $10 million of total risk-based (Tier
2) capital.
Reference is made to the Press Release, dated September 27, 1999, which
is attached hereto as Exhibit 99 and is incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(a) Financial Statements.
Not Applicable.
(b) Pro Forma Financial Information.
Not Applicable.
(c) Exhibits:
10 Purchase and Assumption Agreement by and among Independent
Bank Corp., Rockland Trust Company, Fleet Financial Group,
Inc., Fleet National Bank and BankBoston, N.A., dated
September 27, 1999
99 Press Release, dated September 27, 1999
2
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
INDEPENDENT BANK CORP.
Date: October 1, 1999 By: /s/ RICHARD J. SEAMAN
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Richard J. Seaman
Chief Financial Officer and Treasurer
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Exhibit 10
PURCHASE AND ASSUMPTION AGREEMENT
by and among
Fleet Financial Group, Inc.,
Fleet National Bank,
BankBoston, N.A.,
Rockland Trust Company
and
Independent Bank Corp.
September 24, 1999
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TABLE OF CONTENTS
ARTICLE I - DEFINITIONS....................................................1
SECTION 1.1. DEFINED TERMS.............................................1
SECTION 1.2. ACCOUNTING TERMS.........................................15
ARTICLE II PURCHASE AND SALE OF PURCHASED ASSETS AND ASSIGNMENT AND
ASSUMPTION OF ASSUMED LIABILITIES.........................................15
SECTION 2.1. PURCHASE AND SALE OF ASSETS; NO OTHER ASSETS PURCHASED...15
SECTION 2.2. ASSUMED LIABILITIES......................................16
ARTICLE III PURCHASE PRICE; PAYMENT; SETTLEMENT; TAX ALLOCATION...........17
SECTION 3.1. PURCHASE PRICE...........................................17
SECTION 3.2. PAYMENT AT CLOSING.......................................18
SECTION 3.3. ADJUSTMENT OF ESTIMATED PAYMENT AMOUNT...................18
SECTION 3.4. ALLOCATION OF PURCHASE PRICE.............................19
SECTION 3.5. PRORATION; OTHER CLOSING DATE ADJUSTMENTS................20
ARTICLE IV TAXES.........................................................20
SECTION 4.1. SALES, TRANSFER AND USE TAXES............................20
SECTION 4.2. INFORMATION REPORTS......................................20
ARTICLE V CLOSING........................................................21
SECTION 5.1. CLOSING DATE.............................................21
SECTION 5.2. SELLER'S DELIVERIES......................................21
SECTION 5.3. PURCHASER'S DELIVERIES...................................23
ARTICLE VI REPRESENTATIONS AND WARRANTIES OF SELLERS......................24
SECTION 6.1. ORGANIZATION.............................................24
SECTION 6.2. AUTHORITY................................................24
SECTION 6.3. NON-CONTRAVENTION........................................24
SECTION 6.4. COMPLIANCE WITH LAW......................................24
SECTION 6.5. LEGAL PROCEEDINGS........................................24
SECTION 6.6. TENANTS; BRANCH LEASES...................................24
SECTION 6.7. TITLE TO PURCHASED ASSETS................................25
SECTION 6.8. LOANS....................................................25
SECTION 6.9. NO BROKER................................................25
SECTION 6.10. ASSUMED DEPOSIT LIABILITIES.............................26
SECTION 6.11. REGULATORY MATTERS......................................26
SECTION 6.12. LIMITATIONS ON AND DISCLAIMER OF REPRESENTATIONS AND
WARRANTIES AND PURCHASER'S RELEASE IN CONNECTION THEREWITH.............26
ARTICLE VII REPRESENTATIONS AND WARRANTIES OF PURCHASER AND INDEPENDENT..27
SECTION 7.1. ORGANIZATION.............................................27
SECTION 7.2. AUTHORITY................................................27
SECTION 7.3. NON-CONTRAVENTION........................................27
SECTION 7.4. LEGAL PROCEEDINGS........................................28
SECTION 7.5. CONSENTS AND OTHER REGULATORY MATTERS....................28
SECTION 7.6. WARN ACT.................................................29
SECTION 7.7. CAPITAL AVAILABLE........................................29
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SECTION 7.8. NO BROKER................................................29
ARTICLE VIII COVENANTS OF SELLERS........................................29
SECTION 8.1. CONDUCT OF THE BUSINESS..................................29
SECTION 8.2. REGULATORY APPROVALS.....................................30
SECTION 8.3. BRANCH AND ATM CONSENTS; OTHER FACILITIES CONSENTS.......30
SECTION 8.4. NONSOLICITATION..........................................31
SECTION 8.5. NONSOLICITATION OF PURCHASER'S EMPLOYEES.................31
SECTION 8.6. LOSS OF BRANCH LOCATION..................................31
ARTICLE IX COVENANTS OF PURCHASER AND INDEPENDENT........................32
SECTION 9.1. REGULATORY APPROVALS AND STANDARDS.......................32
SECTION 9.2. CONSENTS; COMPLIANCE WITH LAW............................33
SECTION 9.3. SOLICITATION OF ACCOUNTS.................................33
SECTION 9.4. NONSOLICITATION OF CERTAIN OF SELLERS' EMPLOYEES.........33
SECTION 9.5. RECORDING OF INSTRUMENTS OF ASSIGNMENT...................34
SECTION 9.6. TRANSFERRED EMPLOYEES....................................34
SECTION 9.7. INTERVIEWS...............................................36
SECTION 9.8. CAPITAL ISSUES...........................................37
SECTION 9.9. INDEPENDENT GUARANTY....................................37
ARTICLE X ACCESS; EMPLOYEE AND CUSTOMER COMMUNICATIONS...................37
SECTION 10.1. ACCESS BY PURCHASER.....................................37
SECTION 10.2. COMMUNICATIONS TO EMPLOYEES; TRAINING...................37
SECTION 10.3. COMMUNICATIONS WITH CUSTOMERS...........................38
ARTICLE XI FACILITIES....................................................39
SECTION 11.1. ENVIRONMENTAL DILIGENCE..................................39
SECTION 11.2. TITLE....................................................41
SECTION 11.3. APPRAISAL OF REAL PROPERTY...............................43
ARTICLE XII TRANSITIONAL MATTERS.........................................44
SECTION 12.1. PAYMENT OF DEPOSIT LIABILITIES..........................44
SECTION 12.2. DELIVERY OF PURCHASER'S CHECK FORMS.....................44
SECTION 12.3. UNCOLLECTED CHECKS RETURNED TO SELLERS..................45
SECTION 12.4. DEFAULT ON LOAN PAYMENTS TO SELLERS.....................45
SECTION 12.5. NOTICES TO OBLIGORS ON LOANS............................45
SECTION 12.6. NEW TELEPHONE NUMBERS...................................46
SECTION 12.7. NEW ATM/DEBIT CARDS.....................................46
SECTION 12.8. INSTALLATION OF EQUIPMENT BY PURCHASER..................46
SECTION 12.9. DEACTIVATION OF ATMS AND ATM/DEBIT CARDS................46
SECTION 12.10. SIGNAGE................................................46
SECTION 12.11. LETTERS OF CREDIT......................................46
SECTION 12.12. ACTIONS WITH RESPECT TO IRA, KEOGH PLAN AND EMPLOYEE
PENSION PLAN DEPOSIT LIABILITIES.......................................49
SECTION 12.13. BULK TRANSFER LAWS.....................................50
SECTION 12.14. ANCILLARY AGREEMENTS...................................50
ARTICLE XIII CONDITIONS TO CLOSING.......................................50
SECTION 13.1. CONDITIONS TO OBLIGATIONS OF SELLERS AND FLEET..........50
SECTION 13.2. CONDITIONS TO OBLIGATIONS OF PURCHASER AND INDEPENDENT..50
ARTICLE XIV DATA PROCESSING..............................................51
SECTION 14.1. CONVERSION...............................................51
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ARTICLE XV INDEMNITY.....................................................52
SECTION 15.1. FLEET'S INDEMNITY.......................................52
SECTION 15.2. INDEPENDENT INDEMNITY...................................52
SECTION 15.3. INDEMNIFICATION PROCEDURE...............................53
SECTION 15.4. LIMITATIONS ON LIABILITY................................53
SECTION 15.5. GENERAL.................................................54
SECTION 15.6. SURVIVAL................................................54
ARTICLE XVI POST-CLOSING MATTERS.........................................55
SECTION 16.1. FURTHER ASSURANCES......................................55
SECTION 16.2. ACCESS TO AND RETENTION OF BOOKS AND RECORDS............55
SECTION 16.3. DEPOSIT HISTORIES.......................................55
ARTICLE XVII MISCELLANEOUS...............................................56
SECTION 17.1. EXPENSES................................................56
SECTION 17.2. TRADE NAMES AND TRADEMARKS..............................56
SECTION 17.3. TERMINATION; EXTENSION OF CLOSING DATE..................56
SECTION 17.4. MODIFICATION AND WAIVER.................................57
SECTION 17.5. BINDING EFFECT; ASSIGNMENT..............................57
SECTION 17.6. CONFIDENTIALITY.........................................57
SECTION 17.7. ENTIRE AGREEMENT; GOVERNING LAW.........................58
SECTION 17.8. CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL...........58
SECTION 17.9. WAIVER OF CERTAIN DAMAGES...............................58
SECTION 17.10. SEVERABILITY...........................................59
SECTION 17.11. COUNTERPARTS...........................................59
SECTION 17.12. NOTICES................................................59
SECTION 17.13. INTERPRETATION.........................................60
SECTION 17.14. SPECIFIC PERFORMANCE...................................60
SECTION 17.15. NO THIRD PARTY BENEFICIARIES...........................60
SECTION 17.16. SURVIVAL...............................................61
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SCHEDULES
SCHEDULE 1.1(A) ATM LEASE AGREEMENTS
SCHEDULE 1.1(B) LIST OF AUTOMATED TELLER MACHINES
SCHEDULE 1.1(C) BRANCH LEASES
SCHEDULE 1.1(D) BRANCHES
SCHEDULE 1.1(E) CONSUMER BANK EMPLOYEES
SCHEDULE 1.1(F) CONSUMER BANK LOANS
SCHEDULE 1.1(G) CONSUMER DEPOSIT LIABILITIES
SCHEDULE 1.1(H) EXCLUDED FIXED ASSETS
SCHEDULE 1.1(I) FIXED ASSETS
SCHEDULE 1.1(J) [RESERVED]
SCHEDULE 1.1(K) ISDA TRANSACTIONS
SCHEDULE 1.1(L) LETTERS OF CREDIT
SCHEDULE 1.1(M) [RESERVED]
SCHEDULE 1.1(N) REAL PROPERTY
SCHEDULE 1.1(O) REAL PROPERTY PURCHASE PRICE
SCHEDULE 1.1(P) SBA LOANS
SCHEDULE 1.1(Q) SMALL BUSINESS BANK DEPOSIT LIABILITIES
SCHEDULE 1.1(R) SMALL BUSINESS BANK LOANS
SCHEDULE 1.1(S) TENANT LEASES
SCHEDULE 1.1(T) DEVELOPMENTAL REAL ESTATE LOANS
SCHEDULE 3.4(A) ALLOCATION OF PURCHASE PRICE
SCHEDULE 6.6(B) BRANCH LEASE EXCEPTIONS
SCHEDULE 6.11 SELLERS REGULATORY APPROVALS
SCHEDULE 7.5(A) PURCHASER REGULATORY APPROVALS
SCHEDULE 14.1 TERMS OF DATA PROCESSING CONVERSION
SCHEDULE 17.2 TRADE NAMES AND TRADEMARKS
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EXHIBITS
EXHIBIT A TERMS OF FLEET BOSTON DIVESTITURE SEVERANCE PLAN
EXHIBIT B FORM OF PURCHASER'S LETTER OF CREDIT
EXHIBIT C FORM OF QUITCLAIM DEED
EXHIBIT D FORM OF BILL OF SALE
EXHIBIT E FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT
EXHIBIT F FORM OF LEASE ASSIGNMENTS
EXHIBIT G FORM OF SELLERS' OFFICER'S CERTIFICATE
EXHIBIT H FORM OF SELLERS' POWER OF ATTORNEY
EXHIBIT I FORM OF PURCHASER OFFICER'S CERTIFICATE
EXHIBIT J FORM OF USE AND OCCUPANCY AGREEMENT
EXHIBIT K FORM OF LEASE AGREEMENT
EXHIBIT L FORM OF COLLATERAL AGENCY AGREEMENT
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PURCHASE AND ASSUMPTION AGREEMENT
This Purchase and Assumption Agreement (the "Agreement") dated as of
September 24, 1999 among Fleet Financial Group, Inc., a Rhode Island corporation
with its principal office at One Federal Street, Boston, Massachusetts 02110
("Fleet"), Fleet National Bank, a national banking association with an office at
One Federal Street, Boston, Massachusetts 02110 ("FNB"), BankBoston, N.A., a
national banking association with an office at 100 Federal Street, Boston,
Massachusetts ("BKB") (FNB and BKB are referred to herein individually as a
"Seller" and collectively as "Sellers"), Rockland Trust Company, a Massachusetts
chartered trust company with its principal office at 288 Union Street, Rockland,
Massachusetts 02370 ("Purchaser") and Independent Bank Corp., a Massachusetts
corporation with its principal office at 288 Union Street, Rockland,
Massachusetts 02370 ("Independent").
WHEREAS, Sellers desire to sell, and Purchaser desires to acquire, certain
assets of the Business in accordance with the terms and provisions of this
Agreement; and
WHEREAS, Sellers desire to transfer to Purchaser, and Purchaser desires to
assume from Sellers, certain liabilities of the Business in accordance with the
terms and provisions of this Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual promises
and covenants contained herein, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, and intending to
be legally bound hereby subject to the terms and conditions set forth herein,
Sellers, Fleet, Purchaser and Independent agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1. DEFINED TERMS. As used in this Agreement, the following
terms shall have the following meanings:
"ACCRUED INTEREST" shall mean, as of any date, (a) with respect to the
Deposit Liabilities, the interest, dividends, fees, costs and other charges that
have been accrued on but not paid, credited, or charged to the Deposit
Liabilities, all as set forth in the applicable Seller's general ledger and (b)
with respect to the Loans, the Advance Lines and the Negative Deposits,
interest, fees, premiums, consignment fees, costs and other charges that have
accrued on or been charged to the Loans, the Advance Lines and the Negative
Deposits but not paid by the applicable borrower, or any guarantor, surety or
other obligor therefor, or otherwise collected by offset, recourse to collateral
or otherwise, all as set forth in the applicable Seller's general ledger.
"ADA" shall mean the Americans with Disabilities Act of 1990, as amended,
and similar state and local laws, regulations, rules and ordinances.
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"ADJUSTED PAYMENT AMOUNT" shall have the meaning specified in Section
3.3(a).
"ADVANCE LINES" shall mean all overdraft lines of credit to owners of the
Deposit Liabilities, plus any and all Accrued Interest thereon.
"AFFILIATE" shall mean, with respect to any Person, any other Person that
directly or indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with, such Person, or a director,
officer, partner, joint venturer or member of such Person and any successors of
such Person.
"APPRAISAL VALUE" shall have the meaning specified in Section 11.3(e)
hereof.
"ASSIGNMENT AND ASSUMPTION AGREEMENT" shall have the meaning specified
in Section 5.2(c).
"ASSUMED LIABILITIES" shall have the meaning specified in Section 2.2.
"ASSUMED SEVERANCE OBLIGATIONS" shall have the meaning specified in
Section 9.6(b).
"ATM LEASE AGREEMENTS" shall mean the lease or operating agreements for
the ATMs listed on SCHEDULE 1.1(A) hereto, as such agreements may be amended,
renewed or extended in the ordinary course of business.
"ATMS" shall mean the automated teller machines listed on SCHEDULE 1.1(B)
hereto.
"AVERAGE DAILY BALANCE" shall mean the aggregate average daily balance
(including Accrued Interest) of the Deposit Liabilities for the period
commencing twenty (20) Business Days prior to the fifth (5th) Business Day prior
to the Closing Date and ending on the fifth (5th) Business Day prior to the
Closing Date.
"BANKBOSTON" shall mean BankBoston Corporation, a Massachusetts
corporation.
"BID LETTER" shall mean that certain letter dated September 24, 1999 from
Purchaser and Independent to Fleet.
"BKB" shall have the meaning specified in the preamble.
"BOARD" shall mean the Board of Governors of the Federal Reserve System.
"BRANCH LEASES" shall mean the lease agreements for the Branches listed on
SCHEDULE 1.1(C) hereto, as such agreements may be amended, renewed or extended
in the ordinary course of business.
"BRANCHES" shall mean the branch offices of FNB to be acquired by
Purchaser and listed on SCHEDULE 1.1(D) hereto.
"BUSINESS" shall mean the Consumer Bank Business and the Small Business
Bank Business.
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"BUSINESS DAY" shall mean any day that is not a Saturday, a Sunday or a
day on which banks are required or authorized by law to be closed in the
Commonwealth of Massachusetts.
"CASH" shall mean all petty cash, vault cash, teller cash, ATM cash and
prepaid postage located at the Branches (including foreign currency), in each
case as of the close of business at the respective Branch (6:00 p.m. for each
automated teller machine) on the Closing Date.
"CAPITAL INFUSION" shall mean the contribution by Independent of the
proceeds of the Capital Transaction to Purchaser as capital.
"CAPITAL TRANSACTION" shall mean the issuance of trust preferred stock as
described in the Bid Letter and the use of the proceeds thereof to effect the
Capital Infusion.
"CLOSING" shall have the meaning specified in Section 5.1(a).
"CLOSING DATE" shall have the meaning specified in Section 5.1(a).
"CODE" shall mean the Internal Revenue Code of 1986, as amended, and the
regulations promulgated thereunder.
"COLLATERAL AGENT" shall mean FNB, in its capacity as collateral agent
under the Collateral Agency Agreement.
"COLLATERAL AGENCY AGREEMENT" shall mean a Collateral Agency Agreement to
be dated as of the Closing Date among FNB, BKB (if applicable), Purchaser and
the Collateral Agent, in the form of EXHIBIT L hereto.
"COLLATERAL ASSIGNMENT INSTRUMENTS" shall mean such assignments, financing
statements, endorsements, stock powers or other instruments as shall be required
under applicable law to transfer to the Collateral Agent in accordance with the
terms of the Collateral Agency Agreement, the Letter of Credit Collateral and
the rights and remedies of Sellers with respect thereto.
"COMPARABLE JOB" shall mean, with respect to any Consumer Bank Employee or
Consumer Bank Related Employee, a position with Purchaser (a) with the same base
salary or wage, (b) with reasonably similar employment background and skill set
requirements, (c) with no significant changes in work schedule and (d) (i) with
respect to a Consumer Bank Employee or Consumer Bank Related Employee located at
a Branch, to be performed at the same Branch or at a Branch located within
thirty (30) miles of the such employee's current Branch or home, whichever is
closer, or (ii) with respect to any other Consumer Bank Employee or Consumer
Bank Related Employee, to be performed within thirty (30) miles of such
employee's current office or home, whichever is closer, each as applicable to
such employee immediately prior to the Closing Date.
"CONFIDENTIALITY AGREEMENT" shall mean that certain letter agreement
between Purchaser and Fleet dated as of May 24, 1999.
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"CONSUMER BANK ASSETS" shall mean the Real Property, the ATMs, the Fixed
Assets, the Consumer Bank Loans, the Cash, the Branch Leases, the ATM Lease
Agreements, the Tenant Leases, and the Safe Deposit Agreements and all keys for
the related safe deposit boxes.
"CONSUMER BANK BUSINESS" shall mean the Consumer Bank Assets, the
Consumer Bank Liabilities and the Consumer Bank Employees.
"CONSUMER BANK EMPLOYEES" shall mean the employees of Sellers listed on
SCHEDULE 1.1(E) hereto, but excluding such employees who shall leave a Seller's
employ between the date hereof and the close of business on the Closing Date,
but including replacements of such employees made in the ordinary course of
business between the date hereof and the Closing Date and including any Person
who fills a vacant position at a Branch in the ordinary course of business
between the date hereof and the Closing Date to provide Branch services to
Customers.
"CONSUMER BANK LIABILITIES" shall mean (a) the Consumer Deposit
Liabilities, and (b) any and all liabilities and obligations relating to or
arising out of the Consumer Bank Assets, to the extent that such liabilities and
obligations arise or accrue after the close of business on the Closing Date, but
including Unfunded Advances under the Loans included therein.
"CONSUMER BANK LOANS" shall mean (a) the loans listed on SCHEDULE 1.1(f)
hereto (exclusive of any reserves for loan losses) and all obligations of a
Seller to make additional extensions of credit in connection with such loans, as
such loans may be increased, decreased, amended, renewed or extended in the
ordinary course of business between July 1, 1999 and the close of business on
the Closing Date, (b) loans made in the ordinary course of business between July
1, 1999 and the close of business on the Closing Date and linked, including by
direct debit, to a Consumer Deposit Liability account (exclusive of any reserves
for loan losses) and all obligations of a Seller to make additional extensions
of credit in connection with such loans, as such loans may be increased,
decreased, amended, renewed or extended in the ordinary course of business
between July 1, 1999 and the close of business on the Closing Date, and (c) any
application pending on the Closing Date for a loan which would be linked,
including by direct debit, to a Consumer Deposit Liability account if such loan
had been made by a Seller prior to the Closing Date, provided, however, that
Consumer Bank Loans shall not include any loan described in subsections (a) or
(b) above, if such loan, as of the Closing Date, is (i) subject to a current
legal proceeding related to a Customer's inability or refusal to pay such loan
or (ii) not current and with respect to which proceedings are pending against
the obligor or obligors of such loan under Title 11 of the United States Code or
(iii) Nonperforming.
Each Consumer Bank Loan shall include all documents executed or delivered in
connection with such loan to the extent such documents are in the loan file
relating to such loan, any and all collateral held as security therefor or in
which a security interest, Lien or mortgage has been granted and any and all
guarantees, insurance and other credit enhancements relating thereto, together
with Accrued Interest thereon, all as exists at the close of business on the
Closing Date.
"CONSUMER BANK RELATED EMPLOYEES" shall mean the employees of Sellers
(other than Consumer Bank Employees) as shall be designated by Sellers from time
to time hereafter in writing to Purchaser for possible interviews for employment
with Purchaser following the Closing Date.
"CONSUMER DEPOSIT LIABILITIES" shall mean all of each Seller's obligations
and liabilities relating to (a) the deposit accounts listed on SCHEDULE 1.1(G)
hereto, and (b) deposit accounts which are opened on
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behalf of a customer by Consumer Bank Employees between July 1, 1999 and the
close of business on the Closing Date, including, without limitation, all
passbook accounts, statement savings accounts, checking, Money Market and NOW
accounts, certificates of deposit, and IRA, Keogh Plan and Employee Pension Plan
accounts, together with Accrued Interest thereon, all as exists at the close of
business on the Closing Date, but excluding any claim or other liability
relating to the origination of any such deposit account or the administration of
any such deposit account prior to the close of business on the Closing Date.
"CONTRIBUTION AGREEMENT" shall mean that certain Contribution Agreement
dated as of October 28, 1997, as amended on February 20, 1998, by and between
Advanta Corporation and Fleet.
"CUSTOMERS" shall mean, individually and collectively, (a) the Persons
named as the owners of the deposit accounts relating to the Deposit Liabilities,
(b) the primary obligors under the Loans, and (c) the parties (other than
Sellers and their Affiliates) to the Safe Deposit Agreements.
"CUSTOMER NOTICES" shall have the meaning specified in Section 10.3(a).
"DAMAGES" shall have the meaning specified in Section 15.1.
"DEPOSIT LIABILITIES" or "DEPOSIT LIABILITY" shall mean the Consumer
Deposit Liabilities and the Small Business Bank Deposit Liabilities, but shall
exclude the Excluded IRA/Keogh/Employee Pension Plan Deposits and the Excluded
Deposits.
"DEVELOPMENTAL REAL ESTATE LOANS" shall mean the loans listed on SCHEDULE
1.1(T) hereto; provided, however, that Developmental Real Estate Loans shall not
include any loan (i) if such loan, as of the Closing Date, is subject to a
current legal proceeding related to a Customer's inability or refusal to pay
such loan, or (ii) if such loan, as of the Closing Date, is not current and with
respect to which proceedings are pending against the obligor or obligors of such
loan under Title 11 of the United States Code or (iii) if the principal and
interest of such loan, as of the Closing Date, is due and unpaid by the borrower
thereunder for more than ninety (90) days prior thereto. Each Developmental Real
Estate Loan shall include all documents executed or delivered in connection with
such loan to the extent such documents are in the loan file relating to such
loan, any and all collateral held as security therefor or in which a security
interest, Lien, or mortgage has been granted and any and all guarantees,
insurance or other credit enhancements relating thereto, together with Accrued
Interest thereon, all as exists at the close of business on the Closing Date.
"DRAFT CLOSING STATEMENT" shall mean a draft closing statement as of the
close of business of the fifth (5th) Business Day immediately preceding the
Closing Date setting forth an estimate of the Purchase Price (including all
adjustments and prorations thereto).
"EMPLOYEE PENSION PLAN" shall mean any employee pension plan for which a
Seller serves as a trustee, including but not limited to, employee pension
benefit plans as defined in Section 3(2) of ERISA, retirement plans qualified
under the requirements of Section 401(a) of the Code, nonqualified deferred
compensation plans, excess benefit plans and supplemental executive retirement
plans.
"EMPLOYEE PENSION PLAN DEPOSIT LIABILITY" shall mean a Deposit Liability
in an account owned by an Employee Pension Plan.
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"ENVIRONMENTAL CONSULTANT" shall have the meaning specified in Section
11.1.
"ENVIRONMENTAL DUE DILIGENCE DATE" shall mean the thirtieth (30th) day
following the execution hereof or, if such day shall not be a Business Day, the
next Business Day thereafter, unless said date is extended in accordance with
Section 11.1(c), in which case, said date shall mean the date to which extended
thereunder.
"ENVIRONMENTAL DUE DILIGENCE PERIOD" shall mean the period commencing on
the date hereof and ending on the Environmental Due Diligence Date.
"ENVIRONMENTAL HAZARD" shall mean the presence of any Hazardous Materials
in violation of any Environmental Laws.
"ENVIRONMENTAL LAWS" shall mean all Federal, state or local laws,
rules, regulations, codes, ordinances, or by-laws, and any judicial or
administrative interpretations thereof, including orders, decrees, judgments,
rulings, directives or notices of violation, that create duties, obligations
or liabilities with respect to (a) human health or (b) environmental
pollution, impairment or disruption, including, without limitation, laws
governing the existence, use, storage, treatment, discharge, release,
containment, transportation, generation, manufacture, refinement, handling,
production, disposal, or management of any Hazardous Materials, or otherwise
regulating or providing for the protection of the environment, and further
including, without limitation, the Comprehensive Environmental Response,
Compensation and Liability Act (42 U.S.C. ss. 9601 eT SEQ.), the Hazardous
Materials Transportation Act (49 U.S.C. ss. 1801 eT SEQ.), the Public Health
Service Act (42 U.S.C. ss. 300 eT SEQ.), the Pollution Prevention Act (42
U.S.C. ss. 13101 eT SEQ.), the Federal Insecticide, Fungicide and Rodenticide
Act (7 U.S.C. ss. 136 eT SEQ.), the Resource Conservation and Recovery Act (42
U.S.C. ss. 6901 eT Seq.), the Safe Drinking Water Act (21 U.S.C. ss. 349, 42
U.S.C. ss.ss.201, 300f), the Toxic Substances Control Act (15 U.S.C. ss.2601 et
seq.), the Clean Water Act (33 U.S.C. ss.1251 eT Seq.), the Clean Air Act (42
U.S.C. ss.7401 eT Seq. ), and similar state and local statutes, and all
regulations adopted pursuant thereto.
"ENVIRONMENTAL REMEDIATION" shall mean performing response actions in
relation to identified Environmental Hazards, including removal, disposal,
treatment or in-place containment actions, which are reasonably required to
achieve permanent regulatory closure with respect to such Environmental Hazard
in accordance with applicable Environmental Laws.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended (11 U.S.C. ss.1101 eT Seq.)
"ESTIMATED PAYMENT AMOUNT" shall have the meaning specified in Section
3.2.
"ESTIMATED PURCHASE PRICE" shall mean the estimate of the Purchase Price
set forth on the Draft Closing Statement.
"EXCLUDED DEPOSITS" shall mean all Deposit Liabilities (a) owned by
employees of Sellers or their Affiliates (other than Transferred Employees) or
Affiliates of Sellers and (b) which were assumed by FNB in connection with the
consummation of the transactions contemplated by the Contribution Agreement, in
each case as exists at the close of business on the Closing Date.
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"EXCLUDED FIXED ASSETS" shall mean (a) artwork, supplies, signs, marketing
aids, trade fixtures or equipment specifically identifying or relating to a
Seller or any of its Affiliates located at the Facilities, (b) telephone systems
located at the Facilities, (c) software, source and object code, user manuals
and related documents and all updates, upgrades or other revisions thereto and
all copies or duplicates thereof located at the Facilities, (d) copying
machines, facsimile machines, scanners, computers, printers, modems, peripheral
equipment, electronic teller station hardware and other hardware related to
teller stations and platforms located at the Facilities, and (e) any other
personal property of Sellers or any of their Affiliates identified on SCHEDULE
1.1(H) hereto, less any such items consumed or disposed of, plus new similar
items acquired or obtained, in the ordinary course of the operation of the
Facilities through the close of business on the Closing Date.
"EXCLUDED IRA/KEOGH/EMPLOYEE PENSION PLAN DEPOSITS" shall have the meaning
specified in Section 12.12(a).
"FACILITIES" shall mean the Branches and the ATM locations.
"FDIA" shall mean the Federal Deposit Insurance Act, as amended (12 U.S.C.
ss.ss.1811 ET seq.).
"FDIC" shall mean the Federal Deposit Insurance Corporation.
"FEDERAL FUNDS RATE" shall mean, for the period involved, the average of
the interest rates for each day of the period set forth in H.15(519) opposite
the caption "Federal Funds (Effective)". H.15(519) means the weekly statistical
release designated as such, or any successor publication, published by the
Board.
"FINAL" shall mean, as applied to any governmental order or action, that
such order or action has not been stayed, vacated or otherwise rendered
ineffective and either (a) the time period for taking an appeal therefrom shall
have passed without an appeal therefrom having been taken, or (b) if any such
appeal shall have been dismissed or resolved, all applicable periods for further
appeal of such order or action shall have passed.
"FINAL APPROVAL DATE" shall mean, with respect to the transactions
contemplated hereby, the date upon which the last of the following has occurred:
(a) all Regulatory Approvals have been obtained; (b) all applicable regulatory
notices which are required to be published or given prior to consummation of the
transactions contemplated hereby have been published or given; (c) the filing of
all applicable regulatory reports; and (d) the expiration of all applicable
regulatory comment and waiting periods.
"FINAL LOAN SCHEDULE" shall have the meaning specified in
Section 3.3(a).
"FIRPTA AFFIDAVITS" shall mean affidavits pursuant to Section 1445 of the
Code certifying to the non-foreign entity status of Sellers.
"FIXED ASSETS" shall mean all of the furniture, fixtures, equipment and
other assets of Sellers set forth on SCHEDULE 1.1(I) hereto, including but not
limited to leasehold improvements, less any items consumed or disposed of, plus
new items acquired or obtained, in the ordinary course of the operation of the
Facilities through the close of business on the Closing Date, but excluding the
Excluded Fixed Assets
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(whether or not such Excluded Fixed Assets have been listed as furniture,
fixtures, equipment or other assets of a Seller on SCHEDULE 1.1(I)).
"FLEET" shall have the meaning specified in the preamble.
"FLEET BOSTON DIVESTITURE SEVERANCE PLAN" shall mean that certain
severance plan of Fleet and its Affiliates to be dated as of the Closing Date
and containing the terms set forth on EXHIBIT A hereto.
"FNB" shall have the meaning specified in the preamble.
"GAAP" shall have the meaning specified in Section 1.2.
"HAZARDOUS MATERIALS" means (a) any "hazardous material", "hazardous
substance", "hazardous waste", "oil", "regulated substance", "toxic substance"
or words of similar import as defined under any of the Environmental Laws, (b)
asbestos in any form, (c) urea formaldehyde foam insulation, (d) polychlorinated
biphenyls, (e) radon gas, (f) flammable explosives, (g) radioactive materials,
(h) any chemical, contaminant, solvent, material, pollutant or substance that
may be dangerous or detrimental to any of the Facilities, the environment or the
health and safety of employees or other occupants of any of the Facilities, and
(i) any substance, the generation, storage, transportation, utilization,
disposal, management, release or location of which, on, under or from any of the
Facilities is prohibited or otherwise regulated pursuant to any of the
Environmental Laws.
"INDEMNIFIED PARTY" shall have the meaning specified in Section 15.3.
"INDEMNITOR" shall have the meaning specified in Section 15.3.
"IRA" shall mean an individual retirement account as specified in Section
408 and 408A of the Code.
"IRA DEPOSIT LIABILITY" shall mean a Deposit Liability in a deposit
account which is an IRA.
"IRS" shall mean the Internal Revenue Service of the United States.
"ISDA AGREEMENTS" shall mean those International Securities Dealer
Agreements between a Customer and a Seller or other Person or one of its
Affiliates evidencing an ISDA Transaction.
"ISDA TRANSACTIONS" shall mean (a) those transactions set forth on
SCHEDULE 1.1(K) hereto, as such transactions may be renewed or extended in the
ordinary course of business between July 1, 1999 and the close of business on
the Closing Date, and (b) any and all interest rate swap, currency swap,
forward, hedge or similar transactions entered into between July 1, 1999 and the
close of business on the Closing Date which relate to a Loan, each as exists as
of the close of business on the Closing Date.
"ISP98" shall mean the International Standby Practices (ISP98), ICC
Publication No. 590.
"ITEMS" shall mean (a) transfers of funds by wire or through the Automated
Clearing House, checks, drafts, negotiable orders of withdrawal and items of a
like kind which are drawn on or deposited and
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credited to the Deposit Liabilities, and (b) payments, advances, disbursements,
fees, reimbursements and items of a like kind which are debited or credited to
the Loans.
"KEOGH PLAN" shall mean an Employee Pension Plan covering self-employed
individuals.
"KEOGH PLAN DEPOSIT LIABILITY" shall mean a Deposit Liability in a deposit
account which is owned by a Keogh Plan.
"KNOWLEDGE" shall mean, with respect to any Seller, the actual knowledge
as of the date hereof, without further investigation, of any of such Seller's
officers that hold the title of senior vice president or above and have
responsibility with respect to the operations of the Business.
"LANDLORD CONSENTS" shall have the meaning set forth in Section 5.2(e).
"LEASE ASSIGNMENTS" shall have the meaning set forth in Section 5.2(d).
"LETTER OF CREDIT CUSTOMER" shall mean an obligor under a Loan for whose
account a Letter of Credit was issued.
"LETTERS OF CREDIT" shall mean (a) those letters of credit listed on
SCHEDULE 1.1(L) hereto, (b) all letters of credit issued in connection with a
Loan between July 1, 1999 and the close of business on the Closing Date, and (c)
any letter of credit applied for by a Customer (but not yet issued by a Seller)
as of the Closing Date, each as exists as of the close of business on the
Closing Date. To the extent Purchaser shall assume (and the applicable Seller
has been released from) any Letter of Credit or Purchaser has issued a
replacement letter of credit whether on or after the Closing Date, each as
described in Section 12.11(a), the assumed or replaced Letter of Credit shall no
longer be deemed a "Letter of Credit" hereunder.
"LETTER OF CREDIT COLLATERAL" shall mean (a) all collateral in which a
Seller, as issuer of a Letter of Credit, has been granted a lien, security
interest or encumbrance, whether pursuant to a pledge, collateral assignment,
security agreement, mortgage or otherwise, and (b) any other security for any
such Letter of Credit for the benefit of a Seller, including without limitation,
any guaranties, subordination agreements, insurance or other credit enhancements
and any collateral therefor.
"LETTER OF CREDIT DISBURSEMENT" shall mean an amount equal to the sum of
(a) the amount drawn under any Letter of Credit in connection with a Request
plus (b) all reasonable and customary out-of-pocket charges and expenses which a
Seller may pay or incur relative to such Request which are chargeable to the
Customer under the related Reimbursement Agreement.
"LIEN" shall mean any lien, easement, restrictions, pledge, charge,
encumbrance, security interest, mortgage, deed of trust, lease, option or other
adverse claim of any kind or description.
"LOAN VALUE" shall mean, as of any date, the unpaid principal balance of
the Loans, plus Accrued Interest thereon, as set forth in the applicable
Seller's general ledger and, for purposes of Section 3.3, on the Final Loan
Schedule, less (a) accrued servicing fees under arrangements with third parties
to service
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such Loans, less (b) Accrued Interest which as of the Closing Date shall be
outstanding and unpaid for more than ninety (90) days after it shall have first
become due and payable.
"LOANS" shall mean, collectively, the Consumer Bank Loans, the SBA Loans,
the Small Business Bank Loans and the Developmental Real Estate Loans.
"MARKETABLE TITLE" shall mean as to each parcel of Real Property, fee
simple title of record as to which a subsidiary of LandAmerica Financial Group,
Inc. will issue an owner's title insurance policy to Purchaser in at least the
amount of the fair market value of such Real Property and which will not contain
any exceptions that will interfere with the continued use of such Real Property
by Purchaser as a retail bank branch provided, however that if Purchaser fails
to exercise its rights pursuant to Section 11.2(a) hereto, Marketable Title
shall mean title as reflected on the title search reviewed by Purchaser pursuant
to Section 11.2(a) as to which title Purchaser has not timely exercised its
right to object as set forth in Section 11.2(a).
"MATERIAL ADVERSE EFFECT" shall mean any circumstance, change in or effect
on the Purchased Assets or the Assumed Liabilities that is materially adverse to
the business, operation, results of operations or the financial condition of the
Business, taken as a whole; provided, however, that "Material Adverse Effect"
shall not include any circumstance, change in or effect on the Business directly
or indirectly arising out of or attributable to (a) changes in general economic,
legal, regulatory or political conditions, (b) changes in prevailing interest
rates, (c) changes in GAAP, (d) any actions taken or omitted to be taken
pursuant to this Agreement, or (e) the announcement of the transactions
contemplated by this Agreement, any similar other agreement entered into in
connection with the Merger and relating to the divestiture by Sellers or any of
their Affiliates of certain of their respective assets and liabilities or the
Merger Agreement.
"MERGER" shall mean the merger of Fleet and BankBoston pursuant to the
terms of the Merger Agreement.
"MERGER AGREEMENT" shall mean that certain Agreement and Plan of Merger
dated as of March 14, 1999 by and between Fleet and BankBoston, as the same may
be amended or modified from time to time.
"NEGATIVE DEPOSITS" shall mean overdrafts in Deposit Liability accounts
which are not covered by Advance Lines, plus any and all Accrued Interest
thereon.
"NONPERFORMING" shall mean as of the close of business on the Closing Date
any Loan with respect to which any principal or interest shall be due and unpaid
by the borrower thereunder for more than one hundred and twenty (120) days prior
to the Closing Date.
"NOTICE OF PROPOSED TRANSFER" shall have the meaning specified in Section
11.2(d) hereof.
"OFFERING MEMORANDUM" shall mean the Offering Memorandum provided to
Purchaser pursuant to the terms of the Confidentiality Agreement and describing
the Business.
"OPTION PERIOD" shall have the meaning specified in Section 11.2(d)
hereof.
"OUTSTANDING CREDIT EXPOSURE" shall mean, at any time, the aggregate
maximum amount available to be drawn or advanced under each Outstanding Credit
Obligation, the determination of such maximum
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amount to assume (a) compliance with all conditions for drawing or advance under
the specific Letter of Credit, and (b) no reduction (i) for any amount drawn
under any Outstanding Credit Obligation unless such amount is not to be
reinstated under the terms of the specific Letter of Credit, or (ii) for any
amount not available to be drawn or advanced under the terms of the specific
Letter of Credit.
"OUTSTANDING CREDIT OBLIGATIONS" shall mean at any time, those Letters of
Credit (a) which have not been replaced or terminated, and (b) as to which a
Seller has not been released from liability.
"PERMITTED LIENS" shall mean (a) Liens for taxes, assessments,
governmental charges or levies not yet due and payable or which although
delinquent can be paid without penalty or are being contested in good faith by
appropriate proceedings, (b) Liens resulting from a filing by a lessor as a
precautionary filing for a lease, (c) landlords' Liens under the Branch Leases
and ATM Lease Agreements, (d) Liens imposed by law, such as carriers',
warehousemen's and mechanics' Liens and other similar Liens arising in the
ordinary course of business which secure payment of obligations not more than
ninety (90) days past due or which are being contested in good faith by
appropriate proceedings, and (e) any other Liens affecting the Purchased Assets
which do not impede the ownership, operation or value of such Purchased Assets
in any material respect.
"PERSON" shall mean any individual, partnership, joint venture,
corporation, trust, limited liability company, unincorporated organization,
government or other entity.
"PURCHASE PRICE" shall have the meaning specified in Section 3.1.
"PURCHASED ASSETS" shall have the meaning specified in Section 2.1(a).
"PURCHASER" shall have the meaning specified in the preamble.
"PURCHASER REGULATORY APPROVALS" shall have the meaning specified in
Section 7.5(a).
"PURCHASER'S ACCOUNT" shall have the meaning specified in Section 3.2.
"PURCHASER'S LETTER OF CREDIT" shall mean a standby letter of credit
issued by Purchaser in favor of Sellers, in substantially the form of EXHIBIT B
hereto, in a face amount equal to the sum of the aggregate maximum amount
available to be drawn or advanced under each Letter of Credit as of the Closing
Date, the determination of such maximum amount to assume (a) compliance with all
conditions for drawing or advance under the specific Letter of Credit and (b) no
reduction (i) for any amount drawn or advanced under any Letter of Credit unless
such amount is not to be reinstated under the terms of the specific Letter of
Credit or (ii) for any amount not available to be drawn or advanced under the
terms of the specific Letter of Credit.
"QUITCLAIM DEEDS" shall have the meaning specified in Section 5.2(a).
"REAL PROPERTY" shall mean each parcel of real property owned by FNB on
which a Facility is located, and all improvements thereon and other easements
and other rights appurtenant thereto, all as more fully described on SCHEDULE
1.1(N) hereto.
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"REAL PROPERTY PURCHASE PRICE" shall mean, with respect to any parcel or
parcels of Real Property, the purchase price specified on SCHEDULE 1.1(O)
hereto.
"REGULATORY APPROVALS" shall mean the Seller Regulatory Approvals and the
Purchaser Regulatory Approvals.
"REIMBURSEMENT AGREEMENT" shall mean all documents and agreements
evidencing, securing or insuring the obligation of a Letter of Credit Customer
to repay, or the rights of a Seller to recover, sums paid under a Letter of
Credit.
"RELEASE" shall mean releasing, spilling, leaking, pumping, pouring,
emitting, emptying, discharging, ejecting, escaping, leaching, disposing,
seeping, infiltrating, draining or dumping.
"REQUEST" shall have the meaning specified in Section 12.11(c).
"SAFE DEPOSIT AGREEMENTS" shall mean the agreements between a Seller and a
Customer or Customers relating to safe deposit boxes located in the Branches as
of the close of business on the Closing Date.
"SBA" shall mean the United States Small Business Administration.
"SBA CONSENTS" shall mean all consents necessary to transfer to Purchaser
the SBA Loans.
"SBA LOANS" shall mean (a) the loans listed on SCHEDULE 1.1(P) hereto
(exclusive of any reserves for loan losses) and all obligations of a Seller to
make additional extensions of credit in connection with such loans, as such
loans may be increased, decreased, amended, renewed, or extended in the ordinary
course of business between July 1, 1999 and the close of business on the Closing
Date (included within such loans shall be any Letters of Credit and ISDA
Transactions related to such loans), (b) loans originated at the Branches and
made in the ordinary course of business between July 1, 1999 and the close of
business on the Closing Date, which loans are secured by an SBA guaranty,
whether in whole or in part (exclusive of any reserves for loan losses)
(included within such loans shall be any Letters of Credit and ISDA Transactions
related to such loans), and all obligations of a Seller to make additional
extensions of credit in connection with such loans, as such loans may be
increased, decreased, amended, renewed, or extended in the ordinary course of
business between July 1, 1999 and the close of business on the Closing Date and
(c) any application taken at a Branch in the ordinary course of business between
the date hereof and the close of business on the Closing Date and pending on the
Closing Date for a loan which would be secured by an SBA guaranty, whether in
whole or in part; provided, however, that SBA Loans shall not include any loan
described in subsections (a) or (b) above if such loan, as of the Closing Date,
is (i) subject to a current legal proceeding related to a Customer's inability
or refusal to pay such loan, (ii) not current and with respect to which
proceedings are pending against the obligor or obligors of such loan under Title
11 of the United States Code or (iii) Nonperforming; and provided, further, that
with respect to any such loan, to the extent that as of the Closing Purchaser
shall not have received an SBA Consent, such loan shall no longer be deemed an
"SBA Loan" hereunder and shall not be included in the Purchased Assets. Each SBA
Loan shall include all documents executed or delivered in connection with such
loan to the extent such documents are in the loan file relating to such loan,
any and all collateral held as security therefor or in which a security
interest, Lien or mortgage has been granted and any and all guarantees,
insurance and other
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credit enhancements relating thereto, together with Accrued Interest thereon,
all as exists at the close of business on the Closing Date.
"SELLERS" shall have the meaning specified in the preamble.
"SELLER REGULATORY APPROVALS" shall have the meaning specified in
Section 6.11.
"SMALL BUSINESS BANK ASSETS" shall mean the Small Business Bank Loans and
the SBA Loans.
"SMALL BUSINESS BANK BUSINESS" shall mean the Small Business Bank
Assets and the Small Business Bank Liabilities.
"SMALL BUSINESS BANK DEPOSIT LIABILITIES" shall mean all of a Seller's
obligations and liabilities relating to (a) the deposit accounts listed on
SCHEDULE 1.1(Q) hereto, (b) the deposit accounts which are opened at the
Branches between July 1, 1999 and the close of business on the Closing Date by
an obligor of a Small Business Bank Loan or an SBA Loan, and (c) the deposit
accounts which are opened at the Branches between July 1, 1999 and the close of
business on the Closing Date on behalf of a non-borrowing small business
customer by a Consumer Bank Employee including, without limitation, all passbook
accounts, statement savings accounts, checking, Money Market and NOW accounts,
certificates of deposit, and IRA, Keogh Plan and Employee Pension Plan accounts,
together with Accrued Interest thereon, all as exists at the close of business
on the Closing Date, but excluding any claim or other liability relating to the
origination of any such deposit account or the administration of any such
deposit account prior to the close of business on the Closing Date.
"SMALL BUSINESS BANK LIABILITIES" shall mean any and all liabilities and
obligations relating to or arising out of the Small Business Bank Assets, to the
extent that such liabilities and obligations arise and accrue after the close of
business on the Closing Date, but including any Unfunded Advances under the
Loans included therein.
"SMALL BUSINESS BANK LOANS" shall mean (a) the loans listed on SCHEDULE
1.1(R) hereto (exclusive of any reserves for loan losses) and all obligations of
a Seller to make additional extensions of credit in connection with such loans,
as such loans may be increased, decreased, amended, renewed or extended in the
ordinary course of business between July 1, 1999 and the close of business on
the Closing Date (included within such loans shall be any Letters of Credit and
ISDA Transactions related to such loans), (b) loans made to small businesses and
originated at the Branches in the ordinary course of business between July 1,
1999 and the close of business on the Closing Date (exclusive of any reserves
for loan losses) and all obligations of a Seller to make additional extensions
of credit in connection with such loans, as such loans may be increased,
decreased, amended, renewed or extended in the ordinary course of business
between July 1, 1999 and the close of business on the Closing Date (included
within such loans shall be any Letters of Credit and ISDA Transactions related
to such loans), and (c) any application taken at a Branch in the ordinary course
of business between the date hereof and the Closing Date and pending on the
Closing Date for a loan to be made to a small business; provided, however, that
Small Business Bank Loans shall not include any loan described in subsections
(a) or (b) above if such loan, as of the Closing Date, is (i) subject to a
current legal proceeding related to a Customer's inability or refusal to pay
such loan, (ii) not current and with respect to which proceedings are pending
against the obligor or obligors of such loan under Title 11 of the United States
Code or (iii) Nonperforming. Each Small Business Loan
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shall include all documents executed or delivered in connection with such loan
to the extent such documents are in the loan file relating to such loan, and any
and all collateral held as security therefor or in which a security interest,
Lien or mortgage has been granted and any and all guarantees, insurance and
other credit enhancements relating thereto, together with Accrued Interest
thereon, all as exists at the close of business on the Closing Date.
"SUBLEASE AGREEMENT" shall have the meaning specified in Section 8.3(c).
"SWAP MARKET VALUE OF THE ISDA TRANSACTIONS" shall be equal to the
aggregate of bid-offer spread for each ISDA Transaction, calculated by a
nationally recognized securities dealer mutually acceptable to Fleet and
Independent and calculated as if an Early Termination Event (as defined in the
standard form of the ISDA Agreement) has occurred on the Closing Date (as such
term is defined in the standard ISDA Agreement); provided, however, that in the
event that Fleet and Independent are unable to mutually agree upon such
securities dealer, then Fleet shall designate a nationally recognized securities
dealer, Independent shall designate a nationally recognized securities dealer
and such securities dealers shall designate a third nationally recognized
securities dealer to calculate such aggregate bid-offer spread.
"SWAP PORTFOLIO ADJUSTMENT" shall be an amount equal to the Swap Market
Value of the ISDA Transactions.
"TENANT LEASES" shall mean leases or subleases between a Seller, as
lessor, and the tenants, if any, listed on SCHEDULE 1.1(S) hereto.
"TITLE REPORT EXPIRATION DATE" shall have the meaning specified in Section
11.2(a) hereof.
"TRANSFER DATE" shall mean the first Business Day following the Closing
Date.
"TRANSFERRED EMPLOYEES" shall mean all Consumer Bank Employees and the
Consumer Bank Related Employees who accept offers of employment from Purchaser
as contemplated by Section 9.6(a).
"UCC" shall mean the Uniform Commercial Code in effect in the
Commonwealth of Massachusetts.
"UCC ARTICLE 5" shall mean Article 5 of the UCC.
"UCP 500" shall mean the Uniform Customs and Practice for Documentary
Credits, 1993 Revision, ICC Publication No. 500.
"UNFUNDED ADVANCE" shall mean an advance requested under a Loan on or
prior to the Closing Date pursuant to the terms and provisions of such Loan
which a Seller is not obligated to fund until following the Closing Date.
"WARN ACT" shall mean the Worker Adjustment and Retraining Notification
Act, as amended (29 U.S.C. ss.2101, eT Seq.) and similar state and local laws,
regulations and other issuances, including, without limitation, the
Massachusetts law on plant closings under General Laws of the Commonwealth of
Massachusetts, Chapter 151A.
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"YEARS OF SERVICE" shall have the meaning specified in Section 9.6(b)
hereof.
Section 1.2. ACCOUNTING TERMS. All accounting terms not otherwise defined
herein shall have the respective meanings assigned to them in accordance with
"generally accepted accounting principles" consistently applied as are in effect
from time to time in the United States of America ("GAAP").
ARTICLE II
PURCHASE AND SALE OF PURCHASED ASSETS AND
ASSIGNMENT AND ASSUMPTION OF ASSUMED LIABILITIES
Section 2.1. PURCHASE AND SALE OF ASSETS; NO OTHER ASSETS PURCHASED
(a) Subject to the terms and conditions hereof, including without
limitation the assumption by Purchaser of the Assumed Liabilities, as of the
close of business on the Closing Date, each Seller shall sell, convey, assign,
transfer and deliver to Purchaser, and Purchaser shall purchase and accept from
each Seller, all of such Seller's right, title and interest in, to and under
certain assets of such Seller as described below (collectively, the "Purchased
Assets"):
(i) The Consumer Bank Assets;
(ii) The Small Business Bank Assets;
(iii) All of such Seller's rights with respect to the contracts and
relationships giving rise to the Deposit Liabilities;
(iv) The Advance Lines and the Negative Deposits, each as of the
Closing Date;
(v) All insurance premiums paid by Sellers to the FDIC which are
allocated to insurance coverage for the Deposit Liabilities
following the Closing Date, to the extent a proration or
adjustment is made with respect thereto pursuant to Section
3.5;
(vi) All of each Seller's right, title and interest in and to all
books and records relating to the Purchased Assets described
in the other subsections of this Section 2.1(a) and the
Assumed Liabilities, as such books and records may exist and
as are held by Sellers at the Branches;
(vii) The ISDA Agreements; and
(viii) A 100% participation interest in the Letters of Credit as
contemplated by Section 12.11.
(b) Purchaser understands and agrees that it is purchasing only the
Purchased Assets (and assuming only the Assumed Liabilities) specified in this
Agreement and (i) except as may be expressly
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provided for in this Agreement, Purchaser has no interest in any other business
relationship which Sellers or any of their Affiliates has or may have with any
Customer or (ii) any other customer of Sellers or their Affiliates. Purchaser
further understands and agrees that Sellers and their Affiliates are retaining
any and all rights and claims which any of them may have, including but not
limited to indemnification or reimbursement rights, with respect to the
Purchased Assets and the Assumed Liabilities, to the extent that such rights or
claims relate to the conduct of the business of the Business prior to the
Closing.
Section 2.2. ASSUMED LIABILITIES.
(a) Subject to the terms and conditions of this Agreement, including
without limitation the transfer of the Purchased Assets to Purchaser, on the
Closing Date, Purchaser shall assume, and thereafter honor and fully and timely,
pay, perform and discharge when due, the following liabilities of Sellers and
shall perform all duties, responsibilities, and obligations of Sellers under the
following, to the extent that such liabilities, duties, responsibilities and
obligations arise or accrue after close of business on the Closing Date (other
than those described in Section 2.2(a)(viii)(A), which shall not be so limited)
(collectively, the "Assumed Liabilities"):
(i) The Consumer Bank Liabilities;
(ii) The Small Business Bank Liabilities;
(iii) All of each Seller's duties and responsibilities relating to
the Deposit Liabilities, including without limitation, with
respect to: (x) the abandoned property laws of any state; (y)
any legal process which is served on Sellers on or before the
Closing Date with respect to claims against or related to the
Deposit Liabilities; or (z) any other applicable law;
(iv) The Assumed Severance Obligations;
(v) The Advance Lines and the Negative Deposits, each as of the
Closing Date;
(vi) Any of Sellers' accrued and unpaid expenses related to the
operations of the Business to the extent a proration or
adjustment is made with respect thereto pursuant to Section
3.5;
(vii) The ISDA Agreements;
(viii) Any and all liabilities or obligations of Sellers or Fleet or
any of their Affiliates under Environmental Laws relating to,
resulting from or arising out of:
(A) Use or operation of the Real Property or the Facilities
(other than Real Property leased to Purchaser pursuant
to Section 11.1 hereof) prior to, on or after the
Closing Date, or
(B) Use or operation of the Real Property or Facilities by
the Purchaser on or after the Closing Date,
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in either case including without limitation (1) the
presence of any Hazardous Materials or a release or the
threat of a release on, at or from the Real Property or
Facilities, (2) investigative, containment, removal,
clean up and other remedial actions with respect to a
release or the threat of release on, at or from the Real
Property or Facilities, or (3) human exposure to any
Hazardous Materials or nuisances of whatever kind to the
extent the same arise from the condition of the Real
Property or Facilities or the ownership, use, operation,
sale, transfer or conveyance thereof;
(ix) Any and all other liabilities and obligations relating
to or arising out of the Purchased Assets or Assumed
Liabilities to be performed after the Closing or arising
out of the operation of the Facilities or the Real
Property from and after the Closing Date, but only to
the extent that such liabilities or obligations arise or
accrue after the close of business on the Closing Date
and are caused by actions or omissions taken or
occurring after the Closing;
(x) Unfunded Advances under the Loans; and
(xi) The participation obligations as contemplated in Section
12.11 relating to the Letters of Credit.
(b) Except for the Assumed Liabilities and except as otherwise set forth
in this Agreement, Purchaser shall not assume or be bound by any duties,
responsibilities, obligations or liabilities of any kind or nature, whether
known or unknown, whether asserted or unasserted, whether accrued or unaccrued,
whether contingent or otherwise.
ARTICLE III
PURCHASE PRICE; PAYMENT;
SETTLEMENT; TAX ALLOCATION
Section 3.1. PURCHASE PRICE. The purchase price for the Purchased Assets
shall be an amount computed as follows (the "Purchase Price"):
(a) An amount equal to twelve percent (12%) of the Average Daily Balance;
PLUS
(b) The aggregate of the Real Property Purchase Prices for all of the Real
Property; (other than the Real Property leased pursuant to Section 11.1); PLUS
(c) The aggregate net book value of the Fixed Assets as reflected on the
general ledger of the applicable Seller as of the close of business on the
Closing Date; PLUS
(d) The Loan Value of the Loans as of the close of business on the Closing
Date; PLUS
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(e) The aggregate unpaid principal balance of the Advance Lines and the
Negative Deposits, plus Accrued Interest thereon (to the extent such Accrued
Interest shall be outstanding and unpaid for ninety (90) days or less prior to
the Closing Date), each as set forth on the general ledger of the applicable
Seller, as of the close of business on the Closing Date, PLUS
(f) The aggregate net book value of the owned ATMs, as set forth on the
general ledger of the applicable Seller, as of the close of business on the
Closing Date; PLUS
(g) The aggregate amount of Cash as of the close of business on the
Closing Date; PLUS
(h) (i) The Swap Portfolio Adjustment, if such adjustment is a positive
number or (ii) if the Swap Portfolio Adjustment is a negative number, MINUS the
absolute value of the Swap Portfolio Adjustment.
Section 3.2. PAYMENT AT CLOSING. On or prior to the second Business Day
immediately preceding the Closing Date, Sellers shall deliver to Purchaser the
Draft Closing Statement. On the Closing Date, FNB shall pay to Purchaser by wire
transfer of immediately available funds to such account as Purchaser shall
advise Sellers no later than three (3) Business Days prior to the Closing Date
("Purchaser's Account") the amount by which the Average Daily Balance (including
Accrued Interest) as calculated as of the close of business on the fifth (5th)
Business Day preceding the Closing Date exceeds the Estimated Purchase Price
(the "Estimated Payment Amount").
Section 3.3. ADJUSTMENT OF ESTIMATED PAYMENT AMOUNT.
(a) On or before 12:00 noon on the thirtieth (30th) day following the
Closing Date, Sellers shall deliver to Purchaser a statement setting forth (i)
the Purchase Price (including all adjustments and prorations thereto) and each
component thereof (including with respect to the Loans a Schedule as of the
close of business on the Closing Date of the Loans (the "Final Loan Schedule"))
and (ii) the amount of the Average Daily Balance. Sellers shall make available
to Purchaser and/or its representatives such work papers, schedules and other
supporting data as may be reasonably requested by Purchaser to enable Purchaser
to verify such determinations. Such statement shall also set forth the amount
(the "Adjusted Payment Amount") by which the Average Daily Balance exceeded the
Purchase Price (including all adjustments and prorations thereto) calculated as
of the close of business on the Closing Date or such other date as required by
this Agreement.
(b) On or before 12:00 noon on the sixtieth (60th) day following the
Closing Date, FNB shall pay to Purchaser by wire transfer of immediately
available funds to Purchaser's Account, an amount equal to the excess of the
Adjusted Payment Amount over the Estimated Payment Amount, plus interest
calculated using the Federal Funds Rate on such excess amount from the Closing
Date to but excluding the payment date, or, if the Estimated Payment Amount
exceeds the Adjusted Payment Amount, Purchaser shall pay to FNB by wire transfer
of immediately available funds to such account as FNB shall advise Purchaser, an
amount equal to such excess, plus interest thereon calculated using the Federal
Funds Rate from the Closing Date to but excluding the payment date. Any payment
or refund pursuant to this Section 3.3(b) shall be treated, for all purposes, as
an adjustment to the Purchase Price.
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Section 3.4. ALLOCATION OF PURCHASE PRICE.
(a) Purchaser and Sellers agree that, upon final determination of the
Purchase Price, the Purchase Price shall be allocated to the Purchased Assets in
accordance with SCHEDULE 3.4(A) hereto.
(b) Purchaser and Sellers shall report the transaction contemplated by
this Agreement (including income tax reporting requirements imposed pursuant to
Section 1060 of the Code) in accordance with the allocation specified on
SCHEDULE 3.4(A) hereto. In the event any party hereto receives notice of a tax
audit with respect to the allocation of the Purchase Price specified herein,
such party shall immediately notify the other party in writing as to the date
and subject of such audit.
(c) If any federal, state or local tax return report or filing by
Purchaser or Sellers relating to the transactions contemplated hereby and filed
on the basis of the allocation set forth on SCHEDULE 3.4(A) hereto, is
challenged by the taxing authority with which such return, report or filing was
filed, the filing party shall assert and maintain in good faith the validity and
correctness of such allocation during the audit thereof until the issuance by
the taxing authority of a "30 Day Letter", or a determination of liability
equivalent thereto, to such party, whereupon such party shall, in its sole
discretion, have the right to pay, compromise, settle, dispute or otherwise deal
with its alleged tax liability. If such a tax return, report or filing is
challenged as herein described, the party filing such return, report or filing
shall timely keep the other party apprised of its decisions and the current
status and progress of all administrative and judicial proceedings, if any, that
are undertaken at the election of the filing party.
(d) If either party (including permitted successors and assigns thereof)
to this Agreement defaults under this Section 3.4, it shall pay as damages to
the other party, so long as such other party is not in default under this
Section 3.4, an amount which, after reduction for all income or gain taxes,
including without limitation interest and penalties, which would be incurred
(calculated at the highest marginal rate applicable in the relevant
jurisdictions) as a result of receiving said amount, is equal to the result (but
not less than zero) of subtracting the amount in (ii) below from the amount in
(i) below:
(i) The total amount of income or gains taxes (including
interest and penalties calculated at the highest
marginal rate applicable in the relevant jurisdictions)
to all jurisdictions imposing such taxes upon the
non-defaulting party with respect to the transactions
contemplated hereby; and
(ii) The total amount of income or gains taxes which would
have been incurred (including interest and penalties
calculated at the highest marginal rate applicable in
the relevant jurisdictions) to all jurisdictions
imposing such taxes upon the non-defaulting party with
respect to the transactions contemplated hereby, if such
taxing jurisdictions had accepted the allocations
specified in SCHEDULE 3.4(A) hereto.
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Section 3.5. PRORATION; OTHER CLOSING DATE ADJUSTMENTS.
(a) Except as otherwise specifically provided in this Agreement, it is the
intention of the parties that Sellers will operate the Facilities for their own
account and own the Loans and other Purchased Assets (and all rights associated
therewith) until the close of business on the Closing Date, and that Purchaser
shall operate the Facilities, own the Loans and other Purchased Assets and
assume the Deposit Liabilities and other Assumed Liabilities (and all rights
associated therewith) for its own account from and after the close of business
on the Closing Date. Thus, except as otherwise specifically provided in this
Agreement, items of income and expense shall be prorated as of the close of
business on the Closing Date, and shall be settled between Sellers and Purchaser
as of the Closing Date, whether or not such adjustment would normally be made as
of such time. Items of proration will be handled as an adjustment to the
Purchase Price and not as adjustments to the Estimated Payment Amount, unless
otherwise agreed by the parties hereto.
(b) For purposes of this Agreement, items of proration and other
adjustments shall include, without limitation: (i) amounts prepaid and unused
for safe deposit rentals; (ii) rental and other payments under the Branch
Leases, ATM Lease Agreements and Tenant Leases, including security deposits;
(iii) sales, real estate and use taxes (other than such sales, real estate and
use taxes that arise as a result of the transactions contemplated by this
Agreement which shall be paid by Purchaser or by Sellers in accordance with
Section 4.1 hereof); (iv) insurance premiums paid or payable to the FDIC
attributable to insurance coverage for the Deposit Liabilities for the period
from and after the Closing Date; (v) fees for customary annual or periodic
licenses or permits; (vi) water, sewer, fuel and utility charges; and (vii)
other prepaid items of income and expense, in each case as of the close of
business on the Closing Date; provided that items of proration and other
adjustments shall not include commitment and other fees paid in advance by
Customers with respect to Loans, Letters of Credit and ISDA Agreements.
Notwithstanding the foregoing, if accurate arrangements cannot be made as of the
Closing Date for any of the foregoing items of proration, the parties shall
apportion the charges for the foregoing items on the basis of the bill therefor
for the most recent billing period prior to the Closing Date.
ARTICLE IV
TAXES
Section 4.1. SALES, TRANSFER AND USE TAXES. Except as otherwise provided
in this Agreement, any sales, transfer, use or similar taxes, including but not
limited to all transfer taxes required in connection with the transfer of the
Real Property to Purchaser, which are payable or arise as a result of this
Agreement or the consummation of the transactions contemplated hereby, shall be
paid by Purchaser on the Closing Date.
Section 4.2. INFORMATION REPORTS. Purchaser and Sellers shall each provide
to the IRS on a timely basis and otherwise as required by law Forms 1099INT,
1099R, W-2P, 5498 and any other required forms and reports with respect to each
Deposit Liability concerning interest paid on, or contributions to and
distributions from, the Deposit Liability accounts, as appropriate, for the
periods during which Purchaser and Sellers, respectively, administered such
accounts, including without limitation, any information required by the IRS
pursuant to any request for back-up withholding and taxpayer identification
number certification
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records and documents. Sellers shall make such reports for interest paid or
credited to Customers through and including the Closing Date and Purchaser shall
make such reports after the Closing Date.
ARTICLE V(*)
CLOSING
Section 5.1. CLOSING DATE.
(a) Upon the terms and subject to the conditions of this Agreement, the
purchase and sale of the Purchased Assets and the assumption of the Assumed
Liabilities contemplated by this Agreement shall take place at a closing (the
"Closing") to be held at the offices of Edwards & Angell, LLP, 101 Federal
Street, 23rd Floor, Boston, Massachusetts 02110 at 10:00 a.m. (which Closing
shall be effective as of the close of business on the Closing Date) on the
Friday next following the seventh (7th) Business Day following the satisfaction
or waiver of all conditions to the obligations of the parties set forth in
Article XIII hereof (other than obligations to be performed at the Closing) or
at such other time or on such other date as Sellers and Purchaser may mutually
agree in writing; provided, however, that the Closing Date shall be no earlier
than July 1, 2000 and provided, further, that any party shall be permitted to
extend the Closing Date to such date, which shall be no later than August 30,
2000, if such extension is necessary for Sellers to be prepared to convert
Sellers' account information as to the Deposit Liabilities and the Loans onto
Purchaser's data processing system or for Purchaser to be prepared to accept and
process such account information onto Purchaser's data processing system, or at
such other place or at such other time or on such other date as Sellers and
Purchaser may mutually agree in writing (the day on which the Closing takes
place being the "Closing Date").
(b) It is anticipated that the Transfer Date shall coincide with the
conversion of Sellers' account information as to the Deposit Liabilities and the
Loans onto Purchaser's data processing system. Sellers and Purchaser shall each
use their commercially reasonable efforts to take such actions, and Sellers and
Purchaser shall cooperate with each other, to ensure that such conversion is
completed on the Transfer Date. However, notwithstanding the foregoing, in the
event of an extraordinary data processing occurrence on or prior to the Transfer
Date which prevents such conversion, then at either party's option (i) the
Closing may be postponed, or (ii) the Closing shall take place and Sellers and
their Affiliates shall assist Purchaser in servicing the Deposit Liabilities and
the Loans upon such terms and for such fees as are customarily charged by
unaffiliated third party processors for such arrangements, including but not
limited to, any out-of-pocket costs incurred by Sellers or their Affiliates as a
result of Sellers or their Affiliates providing such service. In the event of a
Closing pursuant to clause (ii) above, the parties shall negotiate in good faith
one or more interim servicing agreements for the Deposit Liabilities and Loans.
Section 5.2. SELLERS' DELIVERIES. On or before the Closing Date, Sellers
shall deliver to Purchaser, duly executed and acknowledged where required:
(a) Deeds for the Real Property in substantially the form of EXHIBIT C
hereto, pursuant to which the Real Property (other than Real Property leased
pursuant to Section 11.1 hereof) shall be transferred to Purchaser "AS IS",
"WHERE IS" and with all faults but with the benefit of any statutory quitclaim
covenants (the "Quitclaim Deeds");
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(b) A bill of sale for the Purchased Assets in substantially the form of
EXHIBIT D hereto, pursuant to which the Purchased Assets (other than the Real
Property) shall be transferred to Purchaser "AS IS", "WHERE IS" and with all
faults;
(c) An assignment and assumption agreement with respect to the Assumed
Liabilities in substantially the form of EXHIBIT E hereto (the "Assignment and
Assumption Agreement");
(d) Lease assignment and assumption agreements with respect to each of the
Branch Leases and ATM Lease Agreements in substantially the form of EXHIBIT F
hereto (the "Lease Assignments");
(e) Subject to the provisions of Section 8.3, such consents of landlords
under the Branch Leases and ATM Lease Agreements as shall be required pursuant
to the terms of such Branch Leases and ATM Lease Agreements to the assignment of
the Branch Leases and ATM Lease Agreements to Purchaser and to the release of
Sellers from liability thereunder (the "Landlord Consents");
(f) An Officer's Certificate in substantially the form of EXHIBIT G
hereto;
(g) An opinion of counsel of Sellers and Fleet (which opinion may be from
in-house counsel), dated the Closing Date, in form and substance reasonably
satisfactory to Purchaser to the effect that: (i) each Seller and Fleet is duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its formation or incorporation, with full corporate power and
authority to enter into and perform its obligations under this Agreement; and
(ii) this Agreement has been duly and validly authorized, executed and delivered
by each Seller and Fleet and (assuming due authorization, execution and delivery
by Purchaser and Independent) is a legal, valid and binding obligation of each
Seller and Fleet, enforceable against each Seller and Fleet in accordance with
its terms, except as enforcement may be limited by receivership,
conservatorship, and supervisory powers of bank regulatory agencies generally as
well as bankruptcy, insolvency, reorganization, moratorium or other laws of
general applicability relating to or affecting creditor's rights, or the
limiting effect of rules of law governing specific performance, equitable relief
and other equitable remedies or the waiver of rights or remedies;
(h) The Draft Closing Statement;
(i) The resignation of the applicable Seller as trustee or custodian, as
applicable, with respect to each IRA, Keogh Plan or Employee Pension Plan
deposit account included in the Deposit Liabilities and the designation of
Purchaser as successor trustee or custodian with respect thereto;
(j) A limited power of attorney granting Purchaser the authority to
execute certain documents on behalf of Sellers in substantially the form of
EXHIBIT H hereto;
(k) The FIRPTA Affidavits;
(l) The Collateral Agency Agreement and the Collateral Assignment
Instruments;
(m) Physical possession of all Purchased Assets as are capable of physical
delivery;
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(n) Possession of all loan files held in the Facilities and all loan files
held by BKB relating to the Developmental Real Estate Loans and collateral in
the custody of Sellers relating to the Loans; and
(o) Such other documents as are necessary to effect the transactions
contemplated hereby as Purchaser shall reasonably request.
Section 5.3. PURCHASER'S DELIVERIES. On or before the Closing Date,
Purchaser shall deliver to Sellers:
(a) The Assignment and Assumption Agreement;
(b) Purchaser's acceptance of its appointment as of the close of business
on the Closing Date as successor trustee or custodian, as applicable, of the
IRA, Keogh Plan and Employee Pension Plan deposit accounts included in the
Deposit Liabilities and its assumption of the fiduciary obligations of the
trustee or custodian with respect thereto;
(c) The Lease Assignments and such other instruments and documents as any
landlord under a Branch Lease or ATM Lease Agreement may reasonably require as
necessary or desirable for providing for the assumption by Purchaser of such
Branch Lease or ATM Lease Agreement, as applicable, each such instrument and
document in the form and substance reasonably satisfactory to the parties hereto
and dated as of the Closing Date;
(d) An Officer's Certificate in substantially the form of EXHIBIT I
hereto;
(e) An opinion of counsel of Purchaser and Independent, dated the Closing
Date, in the form and substance reasonably satisfactory to Sellers, to the
effect that (i) each of Purchaser and Independent is duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
formation or incorporation, with full corporate power and authority to enter
into and perform its obligations under this Agreement; and (ii) this Agreement
has been duly and validly authorized, executed and delivered by each of
Purchaser and Independent, and (assuming due authorization, execution and
delivery by Sellers and Fleet) is a legal, valid and binding obligation of each
of Purchaser and Independent, enforceable against Purchaser and Independent in
accordance with its terms, except as enforcement may be limited by receivership,
conservatorship and supervisory powers of bank regulatory agencies generally as
well as bankruptcy, insolvency, reorganization, moratorium or other laws of
general applicability relating to or affecting creditors' rights, or the
limiting effect of rules of law governing specific performance, equitable relief
and other equitable remedies of the waiver of rights or remedies;
(f) The Purchaser's Letter of Credit;
(g) The Collateral Agency Agreement and the Collateral Assignment
Instruments;
(h) The SBA Consents; and
(i) Such other documents as are necessary to effect the transactions
contemplated hereby as Sellers shall reasonably request.
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ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF SELLERS
Sellers jointly represent and warrant to Purchaser as follows:
Section 6.1. ORGANIZATION. Each Seller is a national bank duly organized,
validly existing and in good standing under the laws of the United States. Fleet
is a corporation duly organized, validly existing and in good standing under the
laws of the State of Rhode Island.
Section 6.2. AUTHORITY. Each Seller and Fleet has the power and authority
to enter into and perform this Agreement and any other documents executed
pursuant hereto. This Agreement and any other documents or instruments executed
pursuant hereto and the execution, delivery and performance hereof and thereof
have been duly authorized and approved by all necessary corporate action on the
part of each Seller and Fleet, and this Agreement and the instruments and
documents executed pursuant hereto constitutes, or when executed will
constitute, the valid and binding obligations of each Seller and Fleet,
enforceable against each Seller and Fleet in accordance with its terms, except
as enforcement may be limited by receivership, conservatorship and supervisory
powers of bank regulatory agencies generally as well as by bankruptcy,
insolvency, reorganization, moratorium or other laws of general applicability
relating to or affecting creditors' rights, or the limiting effect of rules of
law governing specific performance, equitable relief and other equitable
remedies or the waiver of rights or remedies.
Section 6.3. NON-CONTRAVENTION. The execution and delivery of this
Agreement and the instruments and documents executed pursuant hereto by each
Seller and Fleet do not and, subject to the receipt of all Regulatory Approvals,
the consummation of the transactions contemplated by this Agreement will not
constitute (a) a material breach or violation of or default under any law, rule,
regulation, judgment, order, governmental permit or license of any Seller or
Fleet or to which any Seller or Fleet is subject, which breach, violation, or
default would have a Material Adverse Effect or (b) a breach or violation of or
a default under the articles of association or bylaws of any Seller or Fleet.
Section 6.4. COMPLIANCE WITH LAW. To the Knowledge of each Seller, the
business and operations of the Business are being conducted in accordance with
all applicable laws, rules and regulations of all governmental authorities,
other than those laws, rules and regulations of governmental authorities the
penalty or liability for the violation of which, if imposed or asserted, would
not have a Material Adverse Effect.
Section 6.5. LEGAL PROCEEDINGS. There are no actions, suits, or
proceedings, whether civil, criminal or administrative, pending as of the date
of the Agreement or, to the Knowledge of each Seller, threatened as of the date
of the Agreement against or affecting any Seller or Fleet, which would
reasonably be expected to have a Material Adverse Effect.
Section 6.6. TENANTS; BRANCH LEASES.
(a) Except for the tenants listed on SCHEDULE 1.1(S) hereto, there are no
tenants or, to the Knowledge of FNB, other occupants of the Facilities owned by
FNB.
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(b) Except as set forth in SCHEDULE 6.6(B) hereto, each of the Branch
Leases and ATM Lease Agreements is in full force and effect, and to the
Knowledge of FNB, FNB is not in default under any of its obligations thereunder,
except for such defaults which would not have a Material Adverse Effect.
Section 6.7. TITLE TO PURCHASED ASSETS.
(a) A Seller is the lawful owner of each of the Purchased Assets (other
than the Real Property), free and clear of all Liens other than Permitted Liens
and, except for consents required to transfer the Purchased Assets, a Seller has
the right to sell, convey, transfer, assign and deliver to Purchaser all of the
Purchased Assets.
(b) A Seller or an Affiliate thereof is the lawful owner of the Real
Property as shown on the title commitments related to such Real Property
previously delivered to Purchaser.
Section 6.8. LOANS. (a)(i) Each Loan represents the legal, valid and
binding obligation of the related borrower, enforceable by the holder thereof in
accordance with its terms subject, as to enforcement, to applicable bankruptcy,
insolvency, reorganization, liquidation and other similar laws and equitable
principles relating to or affecting the enforcement of creditors' rights
generally.
(ii) Each Loan (A) was originated or purchased by a Seller, (B) to the
extent secured is secured by a valid and enforceable Lien in the collateral
therefor, which Lien is assignable, and (C) contains customary and enforceable
provisions such that the rights and remedies of the holder thereof shall be
adequate for practical realization against any collateral therefor.
(iii) Each Loan complied at the time the Loan was originated in all
material respects with all applicable requirements of applicable federal, state,
and local laws, and regulations thereunder.
(b) Except as set forth in Section 6.8(a)(i), (ii) and (iii) above,
neither Sellers nor Fleet makes any representation or warranty of any kind to
Purchaser relating to the Loans and neither Sellers nor Fleet shall be
responsible (except to the extent represented in Section 6.8(a) above) for (i)
the due execution, legality, validity, enforceability, genuineness, sufficiency,
value or collectibility of the Loans or any document, instrument or agreement in
the loan file, including, without limitation, documents granting a Seller a
security interest in any collateral relating to a Loan, (ii) any representation,
warranty or statement made by an obligor or other party in or in connection with
any Loan, (iii) the financial condition or creditworthiness of any primary or
secondary obligor under any Loan or any guarantor or surety or other obligor
thereof, (iv) the performance by the obligor or compliance with any of the terms
or provisions of any of the documents, instruments and agreements relating to
any Loan, (v) inspecting any of the property, books or records of any obligor,
or (vi) any of the warranties set forth in Section 3-417 of the UCC.
Section 6.9. NO BROKER. Other than Credit Suisse First Boston Corporation
and Keefe Bruyette & Woods (each of whose fees and expenses will be paid solely
by Fleet), no broker or finder, or other party or agent performing similar
functions, has been retained by any Seller or its Affiliates or is entitled to
be paid based on any arrangements, agreements or understandings made by any
Seller or its Affiliates in connection with the transactions contemplated
hereby, and no brokerage fee or other commission has been agreed to be paid by
any Seller or its Affiliates on account of such transactions.
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Section 6.10. ASSUMED DEPOSIT LIABILITIES. The Deposit Liabilities are
insured by the FDIC through the Bank Insurance Fund or the Savings Association
Insurance Fund to the extent permitted by law, and all premiums and assessments
required to be paid in connection therewith have been paid when due by Sellers.
Section 6.11. REGULATORY MATTERS.
(a) The execution, delivery and performance of this Agreement and the
other agreements to be entered into in connection herewith by Fleet and Sellers
do not and will not require any consent, approval, authorization or other order
of, action by, filing or registration with or notification to any governmental
authority except as set forth on SCHEDULE 6.11 hereto ("Seller Regulatory
Approvals").
(b) There are no pending, or to the Knowledge of any Seller, threatened
disputes or controversies between any Seller or Fleet and any federal, state or
local governmental authority, including without limitation with respect to
capital requirements or year 2000 readiness that (i) would reasonably be
expected to prevent or materially delay any Seller or Fleet from being able to
perform their respective obligations under this Agreement or (ii) would
reasonably be expected to impair the validity or consummation of this Agreement
or the transactions contemplated hereby. Neither Sellers nor Fleet has received
any indication from any federal, state or other governmental authority that such
governmental authority would oppose or refuse to grant or issue its consent or
approval, if required, with respect to the transactions contemplated hereby.
Section 6.12. LIMITATIONS ON AND DISCLAIMER OF REPRESENTATIONS AND
WARRANTIES AND PURCHASER'S RELEASE IN CONNECTION THEREWITH. Except as otherwise
addressed in this Article VI, notwithstanding anything to the contrary contained
herein or in any other document or agreement delivered in connection herewith:
(a) Neither Sellers nor Fleet makes any representations or warranties,
express or implied, as to the physical condition of the Fixed Assets, all of
which are being sold "AS IS", "WHERE IS", without recourse and with all faults
at the Closing Date.
(b) Neither Sellers nor Fleet makes any representations or warranty,
express or implied, of any type or nature with respect to the physical condition
of the Facilities or Real Property which are being sold "AS IS, "WHERE IS"
without recourse and with all faults, without any obligation on the part of
Sellers. Except as otherwise expressly set forth in this Agreement, by closing
this transaction, Purchaser hereby releases and agrees to hold harmless Sellers
and Fleet and waives any claims which Purchaser may now or hereafter have
against Sellers or Fleet relating to the physical condition of the Facilities or
the Real Property from and after the Closing, including without limitation with
respect to claims under Environmental Laws or with respect to the presence of
Hazardous Materials or with respect to claims under the ADA.
(c) Neither Sellers nor Fleet makes any representations or warranties to
Purchaser as to whether, or the length of time during which, any accounts
relating to Deposit Liabilities will be maintained by the owners of such Deposit
Liabilities at the Branches after the Transfer Date.
(d) Except as specifically provided for in this Agreement, Sellers and
Fleet disclaim and make no representations or warranties whatsoever with respect
to the Business, Purchased Assets or Assumed
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Liabilities, express or implied, including, without limitation, any
representations or warranties with respect to merchantability, fitness, title,
enforceability, collectibility, documentation or freedom from Liens (in whole or
in part) and disclaim any liability and responsibility for any negligent
representation, warranty, statement or information otherwise made or
communicated, by oversight or information otherwise made or communicated, by
oversight or otherwise (orally or in writing), to Purchaser in connection with
the transactions contemplated hereby (including without limitation, any opinion,
information, projection, statement or advice contained in the Offering
Memorandum or which may have been provided to Purchaser by any employee,
officer, agent, stockholder or other representative of any Seller, Fleet or
their Affiliates in connection with the transactions contemplated hereby).
ARTICLE VII
REPRESENTATIONS AND WARRANTIES OF PURCHASER AND
INDEPENDENT
Purchaser and Independent represent and warrant to Sellers as follows:
Section 7.1. ORGANIZATION. Purchaser is a Massachusetts chartered trust
company duly organized, validly existing and in good standing under the laws of
the Commonwealth of Massachusetts. Independent is a corporation duly organized,
validly existing and in good standing under the laws of the Commonwealth of
Massachusetts.
Section 7.2. AUTHORITY. Each of Purchaser and Independent has the power
and authority to enter into and perform this Agreement and any instruments or
other documents executed pursuant hereto. This Agreement and any instruments or
other documents executed pursuant hereto, and the execution, delivery and
performance hereof and thereof have been duly authorized and approved by all
necessary corporate action on the part of each of Purchaser and Independent, and
this Agreement constitutes a valid and binding obligation of each of Purchaser
and Independent, enforceable against each of Purchaser and Independent in
accordance with its terms, except as enforcement may be limited by receivership,
conservatorship and supervisory powers of bank regulatory agencies generally as
well as bankruptcy, insolvency, reorganization, moratorium or other laws of
general applicability relating to or affecting creditors' rights, or the
limiting effect of rules of law governing specific performance, equitable relief
and other equitable remedies or the waiver of rights or remedies.
Section 7.3. NON-CONTRAVENTION. The execution and delivery of this
Agreement and any instruments or other documents executed pursuant hereto by
Purchaser do not and, subject to the receipt of all Regulatory Approvals, the
consummation of the transactions contemplated by this Agreement, will not
constitute (a) a material breach or violation of or default under any law, rule,
regulation, judgment, order, governmental permit or license of Purchaser or
Independent or to which either is subject, which breach, violation or default
would prevent or materially delay Purchaser or Independent from being able to
perform their respective obligations under this Agreement in all material
respects, or (b) a breach or violation of or a default under the charter or
bylaws of Purchaser or Independent or any material contract or other instrument
to which either of them is a party or by which either of them is bound which
breach, violation or default would prevent Purchaser or Independent from
performing its obligations under this Agreement in all material respects.
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Section 7.4. LEGAL PROCEEDINGS. There are no actions, suits, or
proceedings, whether civil, criminal or administrative, pending or, to the
knowledge of Purchaser or Independent threatened against or affecting Purchaser
or Independent which could prevent or materially delay Purchaser or Independent
from performing its obligations under this Agreement in all material respects.
Section 7.5. CONSENTS AND OTHER REGULATORY MATTERS.
(a) The execution, delivery and performance of this Agreement and the
other agreements to be entered into in connection herewith by Purchaser and
Independent do not and will not require any consent, approval, authorization or
other order of, action by, filing or registration with or notification to (i)
any governmental authority except as set forth on SCHEDULE 7.5(A) hereto
("Purchaser Regulatory Approvals") or (ii) any other party.
(b) There are no pending, or to the knowledge of Purchaser, threatened
disputes or controversies between Purchaser or Independent and any federal,
state or local governmental authority, including without limitation with respect
to capital requirements or year 2000 readiness that (i) would reasonably be
expected to prevent or materially delay Purchaser or Independent from being able
to perform its obligations under this Agreement or (ii) would reasonably be
expected to impair the validity or consummation of this Agreement or the
transactions contemplated hereby. Independent and Purchaser have discussed with
the Massachusetts Division of Banks this Agreement and the transactions
contemplated hereby. Neither Purchaser nor Independent believes or has received
any indication from any federal, state or other governmental authority that such
governmental authority would oppose or refuse to grant or issue its consent or
approval, if required, with respect to the transactions contemplated hereby.
Assuming consummation of the Capital Transaction Purchaser believes that it can
satisfy all capital and other regulatory requirements necessary to obtain all
Purchaser Regulatory Approvals.
(c) The deposits of Purchaser are insured by the FDIC in accordance with
the FDIA, and Purchaser has paid all assessments and has filed all reports
required to be filed by it by the FDIC.
(d) As of the date hereof, without giving effect to the transactions
contemplated hereby, and following the transactions contemplated hereby,
Purchaser is (i) at least "adequately capitalized", as defined in the FDIA, and
(ii) meets all capital requirements, standards and ratios required by each state
or federal bank regulator with jurisdiction over Purchaser, including without
limitation, any such higher requirement, standard or ratio as applies to
institutions engaging in the acquisition of insured institution deposits, assets
or branches, and assuming consummation of the Capital Transaction no such
regulator is likely to, or has indicated that it will, condition any of the
Purchaser Regulatory Approvals upon an increase in Purchaser's capital or
compliance with any capital requirement, standard or ratio applicable to
Purchaser.
(e) To the knowledge of Purchaser, it will not be required to divest any
of the Purchased Assets or Assumed Liabilities or any other asset or liability
as a condition to the receipt of any of the Purchaser Regulatory Approvals.
(f) Purchaser was rated "Satisfactory" or "Outstanding" following its most
recent CRA examination by the regulatory agency responsible for its supervision.
Purchaser has received no notice of and has no knowledge of any planned or
threatened objection by any community group to the transactions contemplated
hereby.
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Section 7.6. WARN ACT. Purchaser is not planning or contemplating, and has
not made or taken, any decisions or actions concerning the Transferred Employees
after the Closing that would require the service of notice under the WARN Act.
Section 7.7. CAPITAL AVAILABLE. Upon consummation of the Capital
Transaction and the Capital Infusion, Purchaser will have sufficient capital to
support the acquisition of the Business and to perform Purchaser's other
obligations hereunder and under any of the other documents executed in
connection herewith.
Section 7.8. NO BROKER. Other than Legg Mason Wood Walker (whose fees and
expenses will be paid solely by Independent), no broker or finder, or any other
party or agent performing similar functions, has been retained by Purchaser or
its Affiliates or is entitled to be paid based on any arrangements, agreements
or understandings made by Purchaser or its Affiliates in connection with the
transactions contemplated hereby and no brokerage fee or other commission has
been agreed to be paid by Purchaser or its Affiliates on account of such
transactions.
ARTICLE VIII
COVENANTS OF SELLERS
Each Seller covenants and agrees with Purchaser as follows:
Section 8.1. CONDUCT OF THE BUSINESS.
(a) From the date hereof through the Closing Date, each Seller shall (i)
conduct its business relating to the Purchased Assets and Assumed Liabilities in
the usual, regular and ordinary course consistent with past practice, (ii) not
grant any salary or wage increase to any Consumer Bank Employee or Consumer Bank
Related Employee or agree to any base salary or wage level with any new employee
who will be considered a Consumer Bank Employee under the terms of this
Agreement, other than grants or agreements made in the ordinary course of
business consistent with past practice, (iii) use commercially reasonable
efforts to maintain and preserve intact its relationships generally with its
Consumer Bank Employees and Customers, and (iv) take no action which would
adversely affect or delay the ability of any party hereto to obtain any
Regulatory Approval or to perform its covenants and agreements under this
Agreement; provided, however that Sellers shall be under no obligation to
advertise or promote new or substantially new customer services in the principal
market area of, or for the benefit of, the Business.
(b) Without limitation of the foregoing, from the date hereof through the
Closing Date neither Sellers nor their Affiliates shall:
(i) Solicit, encourage or induce a Customer to transfer, before the
Closing Date, such Customer's business to a branch other than a Branch or
otherwise to transfer such Customer's business such that it will not constitute
part of the Business;
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(ii) With respect to the Loans, other than in the usual, regular and
ordinary course consistent with past practice, amend the terms of any Loan to
reduce the interest rate applicable to such Loan to a rate that is below the
market rate of interest for similar loans with the same credit rating that are
originated by Sellers for their own portfolios, at the time of such amendment,
if such amendment would, in the aggregate, result in a change in the
characteristics of such portfolio of Loans that would have a material adverse
effect on the Loan Value of the Loans, taken as a whole; or
(iii) With respect to the Deposit Liabilities other than in the
usual, regular and ordinary course consistent with past practice, (A) solicit,
encourage or induce a depositor to transfer any Deposit Liability to a branch
other than a Branch, or (B) offer deposit accounts at a Branch at interest rates
or on other terms which are different than those offered by Sellers at any
branch other than a Branch if such actions described in subsections (A) and (B),
would, in the aggregate, have a Material Adverse Effect.
Section 8.2. REGULATORY APPROVALS. Sellers shall use their commercially
reasonable efforts to assist Purchaser in obtaining the Purchaser Regulatory
Approvals. Sellers shall provide Purchaser or the appropriate governmental
authorities with all information reasonably required to be submitted by Sellers
in connection with the Purchaser Regulatory Approvals.
Section 8.3. BRANCH AND ATM CONSENTS; OTHER FACILITIES CONSENTS.
(a) FNB shall use its commercially reasonable efforts (which shall not
require FNB or its Affiliates to pay any money or other consideration not
otherwise duly payable with respect to any Branch Lease or ATM Lease to any
Person or to initiate any claim or proceeding against any Person) to cause every
landlord of a Branch Lease or ATM Lease Agreement, the consent of which is
required under the terms of the applicable Branch Lease or ATM Lease Agreement
to the assignment of such Branch Lease or ATM Lease Agreement to Purchaser, to
execute in favor of Purchaser a Landlord Consent.
(b) Notwithstanding anything to the contrary contained in this Agreement,
FNB's failure to obtain a Landlord Consent from a landlord under a Branch Lease
or ATM Lease Agreement after using such commercially reasonable efforts to
obtain the same shall not entitle Purchaser to terminate this Agreement and
Purchaser shall remain obligated to perform all of its obligations hereunder
with respect to the applicable Branch or ATM location, including without
limitation, the assumption of the Deposit Liabilities relating thereto and the
payment of the full Purchase Price without any reduction or adjustment, but
excluding only the Purchaser's obligation to assume such Branch Lease or ATM
Lease Agreement.
(c) If, despite FNB's commercially reasonable efforts, a Landlord Consent
to assignment of a Branch Lease or ATM Lease Agreement cannot be obtained, or
cannot be obtained without the payment of an assignment fee or similar lump sum
or rent increase, FNB shall, if permitted without the consent of the Landlord
under the Branch Lease or ATM Lease Agreement, sublease the Branch or ATM
location to Purchaser pursuant to a sublease agreement which shall be for the
remainder of the existing term of the Branch Lease or ATM Lease Agreement, as
applicable, and which shall provide for Purchaser to perform all of the
obligations of FNB under such Branch Lease or ATM Lease Agreement and which
otherwise shall contain mutually agreeable terms (a "Sublease Agreement").
(d) If despite its commercially reasonable efforts (which shall not
require FNB or its Affiliates to pay any money or other consideration not
otherwise duly payable with respect to such Branch Lease
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or ATM Lease to any Person or to initiate any claim or proceeding against any
Person) FNB shall be unable to deliver (i) a Landlord Consent with respect to a
Branch Lease or ATM Lease Agreement or (ii) a Sublease Agreement, FNB shall make
available to Purchaser the space necessary for the operations of the applicable
Branch or ATM pursuant to a Use and Occupancy Agreement substantially in the
form of EXHIBIT J hereto.
(e) Anything contained in this Agreement to the contrary notwithstanding,
this Agreement shall not constitute an agreement to assign any Purchased Asset,
contract, Deposit Liability or other Assumed Liability, or any claim or right or
any benefit arising thereunder or resulting therefrom if an attempted assignment
thereof, without the consent of a third party thereto, would constitute a breach
thereof or in any way affect the rights of any Seller thereunder or be contrary
to applicable law. If any such consent or approval is not obtained, Sellers will
use their commercially reasonable efforts (which shall not require Sellers or
their Affiliates to pay any money or other consideration to any Person or to
initiate any claim or proceeding against any Person) to secure an arrangement
reasonably satisfactory to Purchaser insuring that Purchaser will receive the
benefits under the agreement for which such consent is being sought following
the Closing; provided, however, that Sellers shall have no obligation to obtain
such consent or approval or to provide such an alternative arrangement other
than the undertaking to use commercially reasonable efforts to obtain the same
as set forth in this Section 8.3 and Purchaser shall remain obligated to close
the transactions contemplated herein, subject to the other provisions hereof,
and shall have no remedy for Sellers' failure to obtain any such consent or
approval or to provide any such alternative arrangement.
Section 8.4. NONSOLICITATION. For a period of two (2) years following the
Closing Date, neither Seller shall use any list of Customers as a means to offer
the same or similar products and services of the Business to any Customer as was
provided to such Customer by the Business immediately prior to the Closing Date.
Notwithstanding the foregoing sentence, Sellers and their Affiliates shall be
permitted to (a) engage in advertising, solicitations or marketing campaigns,
programs or other efforts not primarily directed to or targeted at the
Customers, including without limitation such campaigns, programs or efforts in
connection with lending, deposit, safe deposit, trust or other financial
services relationships with such Customers, (b) engage in other lending,
deposit, safe deposit, trust or other financial services relationships, (c)
respond to unsolicited inquiries, and (d) provide notices or communications
relating to the transactions contemplated hereby in accordance with the
provisions hereof.
Section 8.5. NONSOLICITATION OF PURCHASER'S EMPLOYEES. In consideration of
the consummation of the transactions contemplated hereby, Sellers agree that,
for a period of two (2) years following the Closing Date, they shall not,
directly or indirectly, solicit for employment, retain as an independent
contractor or consultant, induce to terminate employment with Purchaser or
otherwise interfere with Purchaser's employment relationship with any
Transferred Employee; provided, however, that this Section 8.5 shall not apply
(i) if any such employee has been terminated by Purchaser or any of its
Affiliates for any reason or (ii) if such employee is hired by a Seller or any
of its Affiliates as a result of a general solicitation for employment in
newspaper advertisements or other periodicals of general circulation not
specifically targeted to employees of Purchaser.
Section 8.6. LOSS OF BRANCH LOCATION. In the event that between the date
hereof and the Closing Date, any Branch shall suffer a casualty loss such that,
in the commercially reasonable opinion of Purchaser, such Branch may no longer
be used as a bank branch, Purchaser may elect not to (A) (i) if the Branch is
owned by FNB, acquire the Real Property associated with such Branch or (ii) if
the Branch is leased by
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FNB, assume the Branch Lease associated with such Branch, (B) acquire the Fixed
Assets and the Loans associated with such Branch and (C) assume the Deposit
Liabilities of Customers whose accounts with respect to such Deposit Liabilities
are maintained at such Branch. Notwithstanding any such election, Purchaser
shall not be entitled to terminate this Agreement and Purchaser shall remain
obligated to perform all of its obligations hereunder, including, without
limitation, the assumption of the Deposit Liabilities (other than as provided in
this Section 8.6) and the payment of the Purchase Price (adjusted to reflect the
Purchased Assets and the Assumed Liabilities which Purchaser elects not to
acquire or assume pursuant to this Section 8.6).
ARTICLE IX
COVENANTS OF PURCHASER AND
INDEPENDENT
Purchaser and Independent covenant and agree with Sellers as follows:
Section 9.1. REGULATORY APPROVALS AND STANDARDS
(a) Not later than seven (7) days after the date hereof, Independent and
Purchaser shall discuss with the FDIC this Agreement and the transactions
contemplated hereby and shall advise Sellers in writing whether the FDIC
indicates that it will oppose (or not oppose) or refuse to issue its consent or
approval with respect to the transactions contemplated hereby and whether
Independent or Purchaser believes that the FDIC will oppose or refuse to consent
to or approve the transactions contemplated hereby. Purchaser will use its
commercially reasonable efforts to obtain as expeditiously as possible the
Purchaser Regulatory Approvals and SBA Consents and will file within thirty (30)
days after the execution of this Agreement all necessary applications of
Purchaser to obtain the Purchaser Regulatory Approvals and SBA Consents.
Purchaser will supply to Sellers, at least five (5) Business Days prior to
filing, copies of all proposed regulatory applications and filings (other than
confidential portions thereof) and will use reasonable efforts to reflect any
comments of Sellers in such filings. As of the Closing Date, Purchaser will
satisfy any and all of the standards and requirements reasonably within its
control imposed as a condition to obtaining or necessary to comply with the
Purchaser Regulatory Approvals and the SBA Consents. Purchaser shall pay any
fees charged by any governmental authorities to which it must apply to obtain
any of the Purchaser Regulatory Approvals or the SBA Consents. Purchaser shall
take no action which would adversely affect or delay the ability of any other
party hereto to obtain any Regulatory Approval or to perform its covenants and
agreements under this Agreement. Purchaser shall notify Sellers promptly (and in
no event later than one (1) Business Day following notice) of any significant
development with respect to any application or notice Purchaser files with any
governmental authority in connection with the transactions contemplated by this
Agreement.
(b) From the date hereof through the Transfer Date, Purchaser shall (i)
remain at least "adequately capitalized", as defined in the FDIA, (ii) meet all
capital requirements, standards and ratios required by each state or federal
bank regulator with jurisdiction over Purchaser, including without limitation,
any such higher requirement, standard or ratio as shall apply to institutions
engaging in the acquisition of insured institution deposits, assets or branches
and (iii) maintain at least "satisfactory" CRA ratings.
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(c) Purchaser hereby confirms that after the Closing it is Purchaser's
intention to conduct a banking business at the Branches, and therefore as of the
date of this Agreement it is not expected that the transactions contemplated by
this Agreement will result in the closing, consolidation or relocation of any of
the Branches. Purchaser agrees that it shall be solely responsible for complying
with any required branch closing or other notices to regulators and customers in
the event Purchaser should at any time determine to close, consolidate or
relocate any of the Branches or to close, consolidate or relocate any branch of
Purchaser in connection with or relating to the transactions contemplated by
this Agreement.
Section 9.2. CONSENTS; COMPLIANCE WITH LAW. Purchaser shall provide such
financial and other information as shall be reasonably requested by landlords
under the Branch Leases and ATM Lease Agreements. Notwithstanding anything to
the contrary contained herein, Purchaser agrees that the form of Landlord
Consent with respect to a Branch Lease or an ATM Lease Agreement may be modified
at the request of a landlord to incorporate any and all conditions, terms and
agreements such landlord may require with respect to such landlord's required
consent to the assignment of such Branch Lease or ATM Lease Agreement to
Purchaser, provided that such conditions, terms and agreements do not constitute
a material or monetary modification or alteration of the terms, covenants and
conditions of such Branch Lease or ATM Lease Agreement or otherwise impose any
material burden on Sellers or Purchaser not otherwise contemplated by such
Branch Lease or ATM Lease Agreement.
Section 9.3. SOLICITATION OF ACCOUNTS. Prior to the Closing Date, neither
Purchaser nor any of its Affiliates shall solicit Customers through advertising
specifically referencing or targeted to such Customers nor transact their
respective businesses in such a way which is reasonably likely to (a) induce
such Customers to close Deposit Liability accounts and open deposit accounts
directly with Purchaser or any of its Affiliates, or (b) result in the transfer
of all or a portion of an existing Deposit Liability from Sellers.
Notwithstanding the foregoing sentence, Purchaser and its Affiliates shall be
permitted to (i) engage in advertising, solicitations or marketing campaigns not
primarily directed to or targeted at such Customers, (ii) engage in lending,
deposit, safe deposit, trust or other financial services relationships existing
as of the date hereof with such Customers through branch offices of Purchaser,
(iii) respond to unsolicited inquiries by such Customers with respect to banking
or other financial services offered by Purchaser and (iv) provide notices or
communications relating to the transactions contemplated hereby in accordance
with the provisions hereof.
Section 9.4. NONSOLICITATION OF CERTAIN OF SELLERS' EMPLOYEES. In
consideration of, among other things, the willingness of Sellers to provide
Purchaser with the opportunity to interview and hire the Consumer Bank Related
Employees, Purchaser and its Affiliates agree that, except in accordance with
this Section 9.4, for a period of two (2) years following the Closing Date, it
shall not, directly or indirectly, solicit for employment, or hire any Person
who is employed by a Seller or its Affiliates in an executive or management
level position or who otherwise is considered by a Seller to be a key employee
and who at the time of such solicitation is employed by the Business in an
executive or management level position or is otherwise considered by a Seller or
its Affiliates to be a key employee; provided, however, that this Section 9.4
shall not apply (i) if any such employee has been terminated by a Seller or any
of its Affiliates for any reason or (ii) if such employee is hired by Purchaser
or any of its Affiliates as a result of a general solicitation for employment in
newspaper advertisements or other periodicals of general circulation not
specifically targeted to employees of Sellers.
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Section 9.5. RECORDING OF INSTRUMENTS OF ASSIGNMENT.
(a) No later than ten (10) Business Days following the Closing Date,
Purchaser shall have recorded all deeds relating to the Real Property.
(b) No later than six (6) months following the Closing Date, Purchaser
shall have recorded all other instruments required, necessary or reasonably
desirable to evidence the acquisition, assignment and assumption of the
Purchased Assets and the Assumed Liabilities, including, without limitation, all
assignments of mortgage, financing statements, and security agreements relating
to the Loans.
Section 9.6. TRANSFERRED EMPLOYEES. Purchaser covenants to Sellers that it
will do or cause the following to occur:
(a) No later than the Final Approval Date, Purchaser shall offer
employment beginning as of the Closing Date to all Consumer Bank Employees upon
terms and conditions described in subsection (c) below and subject to the
Closing. Purchaser may but shall not be obligated to offer employment to any
Consumer Bank Related Employee following the Final Approval Date on the same
terms as required hereunder for offers of employment to Consumer Bank Employees;
provided, however, that Purchaser must offer employment to such Consumer Bank
Related Employees no later than thirty (30) days following the date on which a
list of such Consumer Bank Related Employees is provided to Purchaser. The
position offered to each Consumer Bank Employee and each Consumer Bank Related
Employee must be a Comparable Job. Subject to the provisions of this Section
9.6, Transferred Employees will be subject to the employment terms, conditions
and rules applicable to other similarly situated employees of Purchaser. Nothing
contained in this Agreement shall be construed as an employment contract between
Purchaser and any Transferred Employee.
(b) Effective as of the Closing Date, Purchaser shall assume the Fleet
Boston Divestiture Severance Plan and all obligations for all severance benefits
payable pursuant to such plan (the "Assumed Severance Obligations") to any
Consumer Bank Employee to whom Purchaser does not provide a Comparable Job in
accordance with Section 9.6(a) hereof; provided, however, that transitional
assistance programs for which Purchaser shall be responsible under the Fleet
Boston Divestiture Severance Plan shall be limited to outplacement services. For
a period of one (1) year following the Closing Date, Purchaser shall provide
severance benefits to any Transferred Employee who is terminated by Purchaser on
or after the Closing Date pursuant to the terms of the Fleet Boston Divestiture
Severance Plan. Purchaser shall compute severance benefits by giving all
Transferred Employees full credit for all years of service with any Seller, its
Affiliates and predecessors in accordance with their respective adjusted dates
of hire as furnished by Sellers ("Years of Service"). After the one (1) year
period provided for herein, Purchaser shall provide Transferred Employees with
severance benefits in accordance with Purchaser's severance policy, if any,
crediting Transferred Employees with years of service as provided under this
Agreement.
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(c) Each Consumer Bank Employee, and Consumer Bank Related Employee
offered employment by Purchaser, shall be offered employment subject to the
following terms and conditions:
(i) Base salary or base hourly wages shall be equivalent to the
base salary or base hourly wage paid by a Seller to such
employee as of the close of business on the Closing Date until
such time that Purchaser's compensation policies would entitle
each such employee to an increased salary or base wage; and
(ii) Vacation benefits shall be equivalent to vacation benefits
provided by a Seller to such employee as of the close of
business on the Closing Date, until December 31, 2000. Any
vacation balance to which such employee is entitled in the
year of Closing shall carry over to Purchaser (to a maximum of
four weeks). As of January 1, 2001, Transferred Employees
shall receive in the aggregate for vacation, sick and personal
days the amount of paid time off to which they are entitled
under Purchaser's policies as in effect then and from time to
time thereafter.
(d) Purchaser shall provide such Transferred Employee with the following:
(i) Each Transferred Employee will be eligible to participate in
any qualified profit sharing plan/40l(k) plan or plans of
Purchaser, based on each plan's eligibility criteria as of the
close of business on the Closing Date. Purchaser shall credit
each Transferred Employee with his or her Years of Service
with any Seller, its Affiliates and predecessors in
determining eligibility to participate, vesting and level of
matching contributions in such plan or plans;
(ii) Each Transferred Employee will be eligible to participate in
the Purchaser's qualified pension plan or plans, based on each
such plan's eligibility criteria as of the close of business
on the Closing Date. Purchaser shall credit each Transferred
Employee with his or her Years of Service with any Seller, its
Affiliates and predecessors in determining eligibility to
participate, vesting and eligibility to receive benefits in
Purchaser's pension plan(s); provided, however, that such
crediting of service shall not operate to duplicate any
benefit or the funding of any benefit for any period of
service;
(iii) Each Transferred Employee will receive credit for his or her
Years of Service with any Seller, its Affiliates and
predecessors for purposes of calculation of benefits and
waiting period eligibility in Purchaser's other miscellaneous
benefits programs, including but not limited to, vacation,
severance, leaves of absence, education assistance, sick
leave, long-term disability plans and other similar benefits;
(iv) On the Closing Date eACH TRANSFERRED EMPLOYEE WILL BECOME
IMMEDIATELY ELIGIBLE TO PARTICIPATE IN THE PURCHASER'S HEALTH
AND WELFARE PLANS, INCLUDING BUT NOT LIMITED TO, DENTAL AND
SICK LEAVE, AS SUCH PLANS MAY EXIST, ON THE SAME BASIS AS
OTHER SIMILARLY-SITUATED EMPLOYEES OF PURCHASER. PURCHASER
SHALL WAIVE ANY PRE-EXISTING CONDITION LIMITATIONS WITH
RESPECT
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TO SUCH TRANSFERRED EMPLOYEE AND HIS OR HER DEPENDENTS. WITH
RESPECT TO PURCHASER'S EXISTING LIFE INSURANCE AND LONG-TERM
DISABILITY PLANS, WHICH HAVE A PARTICIPATION WAITING PERIOD OF
NINETY (90) DAYS, THE PURCHASER SHALL USE ITS COMMERCIALLY
REASONABLE BEST EFFORTS TO PROVIDE THAT EACH TRANSFERRED
EMPLOYEE WILL BE IMMEDIATELY ELIGIBLE TO PARTICIPATE IN A PLAN
OR PLANS PROVIDING THE SAME BENEFITS AS PURCHASER'S EXISTING
PLANS EFFECTIVE ON AND AFTER THE CLOSING DATE; PROVIDED
HOWEVER, THAT TRANSFERRED EMPLOYEES SHALL BE ELIGIBLE TO
PARTICIPATE IN PURCHASER'S EXISTING PLANS NOT MORE THAN NINETY
(90) DAYS AFTER THE CLOSING DATE. EXCEPT AS SET FORTH IN THE
IMMEDIATELY PRECEEDING SENTENCE, PURCHASER SHALL CAUSE EACH
TRANSFERRED EMPLOYEE TO BE ELIGIBLE AS OF THE CLOSING DATE FOR
AT LEAST THE AMOUNT OF INSURANCE COVERAGE THAT HE OR SHE
MAINTAINED UNDER SELLERS' PLANS, WITHOUT REQUIRING SUCH
TRANSFERRED EMPLOYEE TO PROVIDE ANY EVIDENCE OF INSURABILITY;
PROVIDED HOWEVER, THAT FOR FULL-TIME TRANSFERRED EMPLOYEES,
LIFE INSURANCE BENEFITS SHALL BE LIMITED TO 2 AND 1/2 TIMES
BASE SALARY, TO A MAXIMUM OF $350,000, AND FOR PART-TIME
TRANSFERRED EMPLOYEES, LIFE INSURANCE BENEFITS SHALL BE
LIMITED TO A MAXIMUM OF $20,000.
(v) UPON CONCLUSION OF HIS OR HER SHORT TERM DISABILITY OR
TEMPORARY LEAVE OF ABSENCE, SUBJECT TO THE TERMS AND
CONDITIONS OF PURCHASER'S PLANS AND POLICIES AND APPLICABLE
LAW, EACH TRANSFERRED EMPLOYEE ON SUCH LEAVE AS OF THE CLOSING
DATE SHALL RECEIVE THE GREATER OF THE SALARY AND VACATION
BENEFITS IN EFFECT (Y) WHEN HE OR SHE WENT ON LEAVE OR (Z)
UPON THE CONCLUSION OF SUCH LEAVE TO THE EXTENT THAT SUCH
TRANSFERRED EMPLOYEE IS ENTITLED TO ANY PAY INCREASE OR
VACATION ENTITLEMENT DURING SUCH LEAVE OF ABSENCE PURSUANT TO
SELLERS' LEAVE OF ABSENCE POLICIES, SHALL OTHERWISE BE TREATED
AS A TRANSFERRED EMPLOYEE AND SHALL BE OFFERED BY PURCHASER
THE SAME OR A SUBSTANTIALLY EQUIVALENT POSITION TO HIS OR HER
POSITION WITH A SELLER PRIOR TO THE LEAVE; and
(vi) To the extent that Purchaser provides any Transferred Employee
with benefit or other plans and such plans accept cash
roll-overs, Purchaser shall allow such Transferred Employee to
roll over into such plans any cash distributions or
contributions received from a Seller or its plans, including
any outstanding loan balances from Sellers' qualified or
thrift retirement plan.
(e) Purchaser shall be responsible for all obligations (including
obligations to provide notices) or liabilities, if any, which may arise in
connection with any Transferred Employee under the WARN Act. Purchaser shall
indemnify and hold Sellers harmless for any WARN Act obligations or liabilities
of Sellers that are triggered by any mass layoff, plant closing or other
employment action by Purchaser within the ninety (90) day period following after
Closing Date.
Section 9.7. INTERVIEWS. Purchaser shall be solely responsible for any
acts or omissions which are wrongful, illegal or in contravention of this
Agreement made by it in connection with interviewing or hiring the Consumer Bank
Employees and Consumer Bank Related Employees. Purchaser shall reimburse the
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Consumer Bank Employees and Consumer Bank Related Employees (if applicable) for
transportation costs at applicable IRS mileage rates to and from any location
where Purchaser shall interview such employees.
Section 9.8. CAPITAL ISSUES.
(a) Independent shall use commercially reasonable efforts to consummate on
or before February 15, 2000 the Capital Transaction.
(b) The proceeds of the Capital Transaction shall be immediately
contributed by Independent to Purchaser pursuant to the Capital Infusion.
Section 9.9. INDEPENDENT GUARANTY. Subject to the terms and conditions of
the Agreement, Independent hereby guarantees the performance by the Purchaser of
Purchaser's obligations (a) hereunder, and (b) under any other agreements made
or documents executed in connection herewith.
ARTICLE X
ACCESS; EMPLOYEE AND CUSTOMER COMMUNICATIONS
Section 10.1. ACCESS BY PURCHASER. Upon execution of this Agreement,
Sellers shall provide Purchaser and its representatives, accountants and counsel
reasonable access during normal business hours and upon five (5) Business Days'
notice to Sellers to the Facilities, Consumer Bank Employees, Consumer Bank
Related Employees, depository records, Loan files, and all other documents and
other information concerning the Facilities, the Business, the Purchased Assets,
the Assumed Liabilities and the Transferred Employees as Purchaser may
reasonably request; provided that a representative of Sellers shall be permitted
to be present at all times and provided further that with respect to information
concerning Consumer Bank Employees and Consumer Bank Related Employees, Sellers'
sole obligation shall be to provide Purchaser with information concerning the
name, position, date of hire and salary of the Consumer Bank Employees and
Consumer Bank Related Employees and Sellers shall not be required to provide
Purchaser with access to or copies of any personnel files or other
individualized employee files or documents, all of which shall remain the sole
property of Sellers. Notwithstanding the foregoing, in no event shall Sellers be
required to provide (a) any information which Sellers, in their sole discretion
deem proprietary, including without limitation, any Sellers' "credit scoring"
system, branch or credit practices, policies or procedures, or staffing models,
(b) any information which is protected by the attorney-client privilege, or (c)
their or any of their Affiliates' tax returns.
Section 10.2. COMMUNICATIONS TO EMPLOYEES; TRAINING.
(a) Sellers and Purchaser agree that promptly following the execution of
this Agreement, meetings shall be held at such location as Purchaser and Sellers
shall mutually agree, provided that representatives of Sellers shall be
permitted to attend such meetings, to announce Purchaser's proposed acquisition
of the Business to the Consumer Bank Employees. Sellers and Purchaser shall
mutually agree as to the scope and content of all communications to the Consumer
Bank Employees and Consumer Bank Related Employees. Except as specifically
provided in this Section 10.2, in no event shall Purchaser contact any Consumer
Bank Employee or Consumer Bank Related Employee without the prior written
consent of Sellers which consent may be granted or withheld in Sellers' sole
discretion.
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(b) At mutually agreed upon times following the initial announcement
described in Section 10.2(a), Purchaser shall be permitted to meet with the
Consumer Bank Employees and Consumer Bank Related Employees to discuss
employment opportunities with Purchaser, provided that representatives of
Sellers shall be permitted to attend any such meeting. From and after the Final
Approval Date, Purchaser shall also be permitted to conduct training sessions
outside of normal business hours or at other times as Sellers may agree, with
the Consumer Bank Employees and Consumer Bank Related Employees (if applicable)
and may, at Sellers' sole option, conduct such training seminars at the
Branches; provided that Purchaser will in good faith attempt to schedule such
training sessions in a manner which does not unreasonably interfere with
Sellers' normal business operations. Purchaser shall reimburse the Consumer Bank
Employees and Consumer Bank Related Employees (if applicable) for transportation
costs to and from the locations where Purchaser shall train such employees and
compensate the Consumer Bank Employees and Consumer Bank Related Employees (if
applicable) or reimburse Sellers at the Consumer Bank Employees and Consumer
Bank Related Employees (if applicable) respective applicable standard or
overtime rates for the time spent in such training.
Section 10.3. COMMUNICATIONS WITH CUSTOMERS.
(a) Following the Final Approval Date but not earlier than fifteen (15)
days prior to the anticipated Closing Date, Purchaser shall send statements to
the Customers announcing the transactions contemplated hereby (such statements
being herein called "Customer Notices"). The form and content of each Customer
Notice shall be subject to the approval of the parties and the cost of printing
and mailing the Customer Notices shall be borne solely by Purchaser. Following
the Final Approval Date, Purchaser shall also be entitled to provide solely at
its own expense such other notices or communications to Customers relating to
the transactions contemplated hereby as may be required by law; provided that
the text of any such notice or communication and the timing of such notice or
communication which is provided prior to the Closing shall be approved in
advance by Sellers, which approval shall not unreasonably be withheld or
delayed.
(b) Except as specifically provided herein, in no event will Purchaser or
its Affiliates contact any Customers prior to the Final Approval Date without
the prior written consent of Sellers which may be granted or withheld in their
sole discretion; provided that Purchaser may contact Customers in connection
with (i) advertising, solicitations or marketing campaigns not primarily
directed to or targeted at Customers, (ii) lending, deposit, safe deposit, trust
or other financial services relationships of Purchaser with Customers through
branch offices of Purchaser existing as of the date hereof, (iii) unsolicited
inquiries by Customers to Purchaser with respect to banking or other financial
services provided by Purchaser, and (iv) notices or communications relating to
the transactions contemplated hereby in accordance with the provisions hereof.
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ARTICLE XI
FACILITIES
Section 11.1. ENVIRONMENTAL DILIGENCE.
(a) Purchaser may conduct, and if so, shall complete within the
Environmental Due Diligence Period and at Purchaser's own expense, environmental
investigations for purpose of identifying Environmental Hazards, including, at
Purchaser's election, so-called "Phase I" assessments and/or "Phase II"
subsurface investigations, by an independent, qualified environmental engineer
or consultant ("Environmental Consultant") of the Real Property during the
Environmental Due Diligence Period, provided that Purchaser shall use its
commercially reasonable efforts to commence any such investigation within five
(5) Business Days from the date hereof.
(b) In the event any such environmental investigation involves any
subsurface investigation of any of the Real Property, Purchaser shall provide
not less than five (5) Business Days notice of same to FNB, identifying the
particular Real Property involved and describing generally the location and
extent of the subsurface investigation to be conducted.
(c) In the event that any such environmental investigations are not
completed within the Environmental Due Diligence Period through no fault of
Purchaser or its Environmental Consultant, Purchaser may request, prior to the
expiration of the initial thirty (30) day period, an extension of the
Environmental Due Diligence Period for a reasonable period of time, not
exceeding thirty (30) days, solely to permit completion of such investigations,
and FNB shall approve same, such approval not to be unreasonably withheld or
delayed. If so approved, the Environmental Due Diligence Period shall be deemed
to extend for such additional period of time.
(d) In the event that as a result of such investigation, potential
Environmental Hazards are disclosed, the Environmental Remediation of which, in
the reasonable judgment of Purchaser's Environmental Consultant, is or will be
the responsibility of FNB, or of Purchaser should it acquire such parcel, and
which in the reasonable judgment of Environmental Consultant to a reasonable
degree of professional certainty will cost more than fifty thousand dollars
($50,000), Purchaser shall deliver to FNB on or before the close of the
Environmental Due Diligence Period the written report of the Environmental
Consultant presenting all necessary information regarding the Environmental
Hazards and the Environmental Remediation required. FNB shall have the right to
review and to deliver to Purchaser FNB's response, which shall include whether
FNB agrees or disagrees regarding the cost of any such Environmental
Remediation. FNB shall deliver such response to Purchaser in writing not more
than fifteen (15) days after receipt of such report, and if FNB disagrees with
Purchaser's position, a statement of the reasons for such disagreement.
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(e) In the event that FNB agrees with the conclusions of the Purchaser's
Environmental Consultant in connection with the cost of Environmental
Remediation at any parcel of Real Property, FNB may, at its election:
(i) make an adjustment to the Purchase Price for the estimated
costs of the Environmental Remediation of any such
Environmental Hazard(s) in excess of fifty thousand dollars
($50,000), which shall not have been completed on or prior to
the Closing Date, with respect to such parcel of Real
Property; or
(ii) take such steps as are necessary to perform Environmental
Remediation by the Closing Date (or make provisions to take
such steps following the Closing Date as shall be reasonably
satisfactory to FNB and Purchaser); or
(iii) lease to Purchaser such parcel of Real Property for an initial
period of ten (10) years pursuant to a lease agreement in the
form specified by EXHIBIT K; provided further that if, during
the term of such lease agreement or renewal or extension
thereof, FNB shall deliver to Purchaser a report of an
Environmental Consultant certifying that the Environmental
Remediation of any Environmental Hazards at or on any such
leased parcel of Real Property has been completed, Purchaser
shall be required to purchase such parcel of Real Property, at
the Real Property Purchase Price, in the event such report is
delivered within six (6) months of the Closing Date, and,
thereafter, at the fair market value of such real property as
agreed to by the parties hereto or, if no such agreement is
reached within thirty (30) days of delivery of such report, as
determined pursuant to an real estate appraisal performed by
an experienced real estate appraiser selected by two other
real estate appraisers designated by FNB and Purchaser,
respectively.
(f) In the event that FNB does not agree with the conclusions of
Purchaser's Environmental Consultant regarding a parcel of Real Property, the
parties agree to refer the matter to a third Environmental Consultant reasonably
acceptable to all parties (or, if the parties cannot agree, selected by the
parties' respective Environmental Consultants) for dispute resolution as
follows:
(i) The parties, through their respective Environmental
Consultants, may make reasonable presentations to the third
Environmental Consultant of their respective positions
regarding the cost of Environmental Remediation required to
address the identified Environmental Hazards at such parcel of
Real Property, and following such presentations, the third
Environmental Consultant shall render his or her opinion
regarding the extent and cost of the required Environmental
Remediation. The parties agree that the determination of the
third Environmental Consultant regarding the cost of any
required Environmental Remediation shall be final and binding
on the parties for purposes of the applicability of this
Section 11.1. In the event that the third Environmental
Consultant determines that the cost of such Remediation will
exceed fifty thousand dollars ($50,000,) the provisions of
Section 11.1(e), above, shall apply, and the Purchaser shall
be considered the "prevailing party"
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for purposes of subparagraph (ii), immediately below. In the
event such cost shall be fifty thousand dollars ($50,000) or
less, FNB shall be such "prevailing party".
(ii) Each of the parties shall bear their own fees and expenses in
connection with the resolution of disputes hereunder, and the
fees and expenses of the third Environmental Consultant shall
be borne by the party who did not prevail in its position
before the third Environmental Consultant.
(iii) With respect to any dispute to be resolved hereunder involving
a parcel of Real Property located in any state in which
environmental professionals are licensed by such state (in
Massachusetts, "Licensed Site Professionals"), each of the
three Environmental Consultants participating in the dispute
resolution process hereunder shall be so licensed.
(g) Purchaser agrees that it and its Environmental Consultant shall
conduct any environmental investigations permitted pursuant to this Section with
reasonable care and subject to customary practices among environmental
consultants and engineers, including without limitation, following completion
thereof, the restoration of any site to the extent practicable to its condition
prior to such investigation and in the case of any subsurface investigations,
the removal of all monitoring wells (unless FNB requests such monitoring wells
to remain). Purchaser's Environmental Consultant must be duly licensed under
applicable state laws and provide proof of adequate liability and professional
errors and omissions insurance (which insurances shall, in each instance, name
FNB as an additional insured upon FNB's request, and shall be in an amount not
less than one million dollars ($1,000,000) per claim and ten million dollars
($10,000,000) in the aggregate).
Section 11.2. TITLE.
(a) Purchaser acknowledges that on or prior to the date hereof, it has
been provided copies of recently issued title searches relating to the Real
Property. No later than thirty one (31) days following the date of this
Agreement, Purchaser shall complete its review of such title searches. If
Purchaser has any objections to title to any parcel of Real Property, Purchaser
shall give FNB written notice of such objections to be received by FNB by 5:00
p.m. on October 25, 1999 (the "Title Report Expiration Date"). If Purchaser
fails to give such notice, Purchaser shall be deemed to have waived its
objections to all matters of title as of the date of the title search and shall
accept title to such parcel of Real Property subject to such matters at Closing.
Upon receiving notice of any objection to title, FNB, at its sole option, may
make reasonable efforts to cure such objection to title before the Closing.
(b) (i) In the event any matter affecting title to the Real Property is
recorded after the date of Purchaser's title search and more than sixty (60)
days prior to the Closing Date, Purchaser shall notify FNB no later than sixty
(60) days prior to the Closing Date of the Purchaser's objection to such title
matter; or (ii) in the event any matter affecting title to the Real Property is
recorded on or after the sixtieth (60th) day prior to the Closing Date,
Purchaser shall notify FNB of Purchaser's objection to such title matter
promptly after the discovery of such matter affecting title; and, in the case of
either (i) or (ii), FNB will make commercially reasonable efforts to cure such
matter affecting title prior to the Closing. Nothing herein shall
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require FNB to incur costs in excess of five thousand dollars ($5,000) in making
such reasonable efforts to cure title with respect to any parcel of Real
Property.
(c) Notwithstanding anything to the contrary contained herein, if FNB
shall be unable to deliver Marketable Title to any parcel of Real Property on
which a Branch is located on the Closing Date and Purchaser elects not to
acquire such parcel of Real Property with such exceptions as render title
thereto not to be Marketable Title, FNB and Purchaser shall lease such Real
Property pursuant to a lease agreement for a current market rental as agreed to
by the parties hereto or, if no such agreement is reached within thirty (30)
days prior to the Closing Date, as determined pursuant to an appraisal for such
Branch obtained pursuant to Section 11.3; provided that such lease agreement
shall provide as follows:
(i) FNB may sell such parcel of Real Property following the first
anniversary of the Closing Date to any Person, subject to such
lease agreement, for any price, and upon such other terms and
conditions as FNB, in its sole discretion, may desire; and
(ii) Such lease agreement shall be for a term of one (1) year,
which shall automatically renew for a term of one (1) year at
the end of the term and each renewal term thereof on the same
terms and conditions, except as to rental, which shall be
changed to the then current market rental, as agreed to by the
parties hereto or, if no such agreement as to such market
rental shall have been reached within thirty (30) days prior
to the commencement of each of the applicable renewal terms,
then as determined pursuant to an appraisal for such Branch
obtained pursuant to Section 11.3; provided that such lease
agreement shall be terminable following the first anniversary
of the Closing Date by FNB, or its successors and assigns
thereto, or Purchaser, upon such number of days written notice
as shall equal the lesser of (A) the minimum number of days
permitted to close such Branch under applicable law, or (B)
ninety (90) days.
(d) In the event that FNB desires to sell such parcel of Real Property, it
shall provide Purchaser, during the one year period following the Closing Date
(the "Option Period") with written notice of such intent to sell ("Notice of
Proposed Transfer"). During the ten (10) day consecutive period commencing on
the date of Purchaser's receipt of the Notice of Proposed Transfer, Purchaser
shall have the first option during said Option Period to purchase the Real
Property, before the same may be sold to any other Person. Purchaser must give
written notice of its election to purchase during such ten (10) day period.
(e) In the event Purchaser sends such Notice of Proposed Transfer, the
purchase price to be paid by Purchaser for the Real Property shall be equal to
the purchase price proposed to be paid by the third-party purchaser and
Purchaser shall also accept the same terms and conditions set forth in the offer
to the third party.
(f) The inability of FNB to deliver a particular parcel of Real Property
in accordance with the terms of this Agreement shall not affect Purchaser's
obligation to purchase the remaining Branches and Real Property or to close the
transactions contemplated herein on the Closing Date, with appropriate
adjustment in the Purchase Price to deduct the Real Property Purchase Price for
such Real Property.
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Section 11.3. APPRAISAL OF REAL PROPERTY.
(a) As contemplated by Section 11.2, either party may designate by written
notice to the other an independent certified appraiser or appraisers to
determine the fair rental value of the Real Property, using appraisers having at
least ten (10) years experience in appraising commercial properties similar to
the properties being appraised.
(b) Unless such other party shall object in writing within ten (10) days
of receipt of such designation, such appraiser or appraisers shall conduct
appraisals of the fair market rental value of the Real Property and deliver two
copies of reports thereof to each of FNB and Purchaser.
(c) In the event the other party shall so object to the first party's
designation, the other party's written objection shall designate an independent
certified appraiser or appraisers acceptable to it, using appraisers having at
least ten (10) years experience in appraising commercial properties similar to
the properties being appraised, which shall conduct such appraisals and deliver
such copies of reports thereof unless the first party shall object in writing to
the appraiser or appraisers designated by the other party within ten (10) days
of such objection.
(d) In the event the first party shall so object to the other party's
designation, the appraisers designated by FNB and Purchaser shall mutually
designate an independent certified appraiser, with at least ten (10) years
experience appraising properties of a similar type, to conduct such appraisals
and deliver such copies of reports thereof.
(e) The fair rental value of the Real Property (the "Appraised Value") as
determined by the appraiser or appraisers designated pursuant to (a), (c) or (d)
above shall be final and binding upon the parties hereto. The parties hereto
shall each pay one half of the cost of retaining the appraiser or appraisers
which determines the Appraised Value.
(f) Without limiting or restricting in any manner the procedure or method
utilized by the appraisers or appraiser to determine the Appraised Value in
accordance with the terms hereof, the reports of appraisals prepared pursuant
hereto shall include such appraiser's or appraisers' determination of the fair
rental value of the Real Property for use as a bank branch.
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ARTICLE XII
TRANSITIONAL MATTERS
Section 12.1. PAYMENT OF DEPOSIT LIABILITIES.
(a) From and after the Closing Date, Purchaser shall (i) pay all properly
drawn and presented checks, negotiable orders of withdrawal, drafts, debits and
other withdrawal orders presented to Purchaser by Deposit Liability account
customers, whether drawn on checks, negotiable orders of withdrawal, drafts, or
other withdrawal order forms provided by Sellers or by Purchaser and (ii) in all
other respects discharge, in the usual course of the banking business, all of
the duties and obligations of Sellers with respect to the balances due and owing
to the Customers who have Deposit Liability accounts. If any Customer who has a
Deposit Liability account draws checks, drafts, or negotiable orders of
withdrawal against the Deposit Liabilities which are presented or delivered to
Sellers not later than ninety (90) days after the Closing Date, Sellers shall
use their commercially reasonable efforts to batch all such checks, drafts,
negotiable orders of withdrawal, or other withdrawal order forms and to deliver
the same to Purchaser at Purchaser's sole expense. Purchaser acknowledges that
any delay, failure, or inability on its part to comply with the obligations
imposed upon it as a depository institution under applicable federal or state
law, with regard to such checks, drafts, negotiable orders of withdrawal or
other withdrawal orders shall not result in any liability or obligation of
Sellers and shall not affect any of the rights of Sellers under this Agreement.
Sellers shall not be deemed to have made any representations or warranties to
Purchaser with respect to any such checks, drafts, negotiable orders of
withdrawal or other withdrawal orders and any such representations or warranties
implied by law are hereby disclaimed and are the responsibility of Purchaser,
except that Sellers shall be chargeable with the warranties and representations
implied by law with respect to any such check, draft, negotiable orders of
withdrawal order, or other withdrawal order, which is paid by Sellers over the
counter.
(b) Purchaser hereby acknowledges that if, after the Closing Date, any
Customer who has a Deposit Liability account, instead of accepting the
obligation of Purchaser to pay the Deposit Liabilities (including Accrued
Interest thereon) shall demand payment from Sellers for all or any part of any
such Deposit Liabilities (including Accrued Interest thereon), Sellers shall not
be liable or responsible for making such payment.
(c) It is Sellers' intent to act in a commercially reasonable manner to
ensure that all Deposit Liability transactions will be referred to Purchaser;
provided however that, if, after the Closing Date, a Seller honors and pays any
Deposit Liabilities which are presented to such Seller for payment, pay any
check, draft, negotiable order of withdrawal or other withdrawal order,
Purchaser shall upon demand by such Seller reimburse such Seller for such
payment. Any payment made under this Section 12.1 shall be made within three (3)
Business Days after demand by such Seller, by wire transfer of immediately
available funds to an account designated by such Seller.
Section 12.2. DELIVERY OF PURCHASER'S CHECK FORMS. Within fifteen (15)
Business Days following the Final Approval Date, but not less than five (5) days
prior to the Closing Date, Purchaser shall, at its sole cost and expense, notify
all Customers who have a Deposit Liability account by letter, in a form
reasonably acceptable to Sellers, of Purchaser's assumption of the Deposit
Liabilities (other than Excluded Deposits) (which shall include a notification
to those Deposit Liability account Customers whose accounts are then
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covered by any type of overdraft protection offered by Sellers, including but
not limited to Advance Lines, that from and after the Closing Date all such
overdraft protection from Sellers shall terminate) and furnish each such
Customer with checks, deposit tickets, or other similar instruments using the
forms of Purchaser, which shall be appropriately encoded with Purchaser's
routing number and with accurate account numbers, and with instructions to the
customer to utilize such checks, deposit tickets, or other similar instruments
on Purchaser's forms on and after the Closing Date and thereafter to destroy any
unused checks on a Seller's forms; such notice and such delivery of checks by
Purchaser shall be by first class U.S. mail.
Section 12.3. UNCOLLECTED CHECKS RETURNED TO SELLERS. From and after the
Closing Date, Purchaser shall promptly pay to Sellers an amount equivalent to
the amount of any checks, negotiable orders of withdrawal, drafts, or any other
withdrawal orders (net of the applicable deposit premium paid by Purchaser with
respect to the Deposit Liabilities represented by any such instrument) credited
as of the close of business on the Closing Date to any Deposit Liability
accounts which are returned uncollected to Sellers after the Closing Date and
which shall include an amount equivalent to holds placed upon such Deposit
Liability accounts for Items cashed by Sellers (net of the applicable deposit
premium paid by Purchaser with respect to the Deposit Liabilities represented by
any such instrument), as of the close of business on the Closing Date which
Items are subsequently dishonored; provided, however, that if Sellers shall have
failed to make or properly reflect in the information provided to Purchaser any
provisional credit or hold on any such Deposit Liability accounts in respect of
uncollected funds represented by any such Item, Purchaser's obligations under
this Section 12.3 in respect of such Item shall be limited to the amount of
collected funds in such Deposit Liability accounts.
Section 12.4. DEFAULT ON LOAN PAYMENTS TO SELLERS. If the balance due on
any Loan has been reduced by Sellers as a result of a payment by check or draft
received prior to the close of business on the Closing Date, which Item is
returned to a Seller after the Closing Date, the Loan Value of such Loan shall
be correspondingly increased and an amount in cash equal to such increase shall
be promptly paid by Purchaser to Sellers within three (3) Business Days after
demand by Sellers by wire transfer of immediately available funds to an account
designated by Sellers.
Section 12.5. NOTICES TO OBLIGORS ON LOANS. (a) Purchaser shall, following
the Final Approval Date, but no later than fifteen (15) days prior to the
Closing Date, prepare and transmit, at Purchaser's sole cost and expense, to
each obligor on each Loan, a notice in a form satisfying all legal requirements
and reasonably acceptable to Sellers to the effect that the Loan will be
transferred to Purchaser and directing that payments be made after the Closing
Date to Purchaser at any address of Purchaser specified by Purchaser, with
Purchaser's name as payee on any checks or other instruments used to make such
payments, and, with respect to all such Loans on which payment notices or coupon
books have been issued, to issue new notices or coupon books reflecting the name
and address of Purchaser as the person to whom and the place at which payments
are to be made. To the extent that Purchaser's notice pursuant to the prior
sentence shall be legally insufficient, Sellers agree, at Purchaser's sole
expense, to provide all Loan obligors with all required notices of the
assignment and transfer of the Loans.
(b) To the extent that any of the Loans transferred from Sellers to
Purchaser involve a transfer of servicing as defined and governed by the Real
Estate Settlement Procedures Act (12 U.S.C. ss.2601 et. Seq.), Sellers and
Purchaser will jointly coordinate any appropriate required Customer notices.
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Section 12.6. NEW TELEPHONE NUMBERS. Purchaser shall, no later than ten
(10) days prior to the Closing Date, obtain new telephone numbers for the
Facilities in Purchaser's name.
Section 12.7. NEW ATM/DEBIT CARDS. Purchaser shall, following the Final
Approval Date, but no later than five (5) days prior to the Closing Date,
furnish ATM/Debit cards to Customers who have Deposit Liability accounts to
replace Sellers' ATM/Debit cards. Purchaser shall, no later than five (5) days
prior to the Transfer Date, notify affected Customers to destroy Sellers'
ATM/Debit cards as of the Transfer Date and shall notify such Customers of
Purchaser's withdrawal limits immediately following the Closing by form of
notice reasonably acceptable to Sellers.
Section 12.8. INSTALLATION OF EQUIPMENT BY PURCHASER. Subsequent to the
Final Approval Date and prior to the Transfer Date, Sellers shall cooperate with
and permit Purchaser, at Purchaser's option and sole cost and expense, to make
provision for the installation of teller and other related equipment in the
Branches; provided, however, that Purchaser shall arrange for the installation
of such equipment at such times and in a manner that does not significantly
interfere with the normal business activities and operation of the Branches.
Section 12.9. DEACTIVATION OF ATMS AND ATM/DEBIT CARDS. On the Transfer
Date, Sellers shall deactivate all ATM/Debit cards issued with respect to all
Deposit Liability accounts and shall electronically block access of those cards
to the Deposit Liability accounts, and shall deactivate the ATMs not later than
8:00 a.m. on the Transfer Date. Point of sale transactions shall be settled
between Purchaser and Sellers for a period of forty-five (45) days after the
Closing Date.
Section 12.10. SIGNAGE. During the ten (10) day period immediately
preceding the Transfer Date, Sellers shall cooperate with any commercially
reasonable request of Purchaser directed to accomplishing the installation of
signage of Purchaser's choosing at the Facilities prior to the Closing Date;
provided, however, that all such installations shall be at the sole cost and
expense of Purchaser, that such installation shall be performed in such a manner
that does not significantly interfere with the normal business activities and
operations of the Facilities, that such signage complies with all applicable
zoning and permitting laws and regulations, that such signage has, if necessary,
received the prior approval of the owner or landlord of the Real Property, and
that all such installed signage shall be covered in such a way as to be
unreadable at all times prior to the Closing. Immediately following the Closing,
Sellers shall, at their sole cost and expense, cover all of their signage in
such a way as to be unreadable after the Closing and shall commence activities
directed to accomplishing the removal of all of Sellers' existing signage at the
Facilities and will diligently pursue such activities in good faith so that such
removal may be effected as promptly as practicable following the Closing.
Section 12.11. LETTERS OF CREDIT.
(a) It is the intention of the parties that Purchaser assume all risks and
obligations arising or accruing after the close of business on the Closing Date
with respect to the Letters of Credit. Accordingly, Purchaser agrees to use its
commercially reasonable efforts to obtain prior to the Closing Date and, in any
event, no later than three (3) months following the Closing Date, the consent of
the beneficiary (if necessary) to the assumption of (and the resulting release
of the applicable Seller from) the Letters of Credit and/or to issue replacement
letters of credit for those Letters of Credit which are standby Letters of
Credit.
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(b) Until such time as there are no Letters of Credit, each Seller hereby
grants to Purchaser, and Purchaser hereby agrees and commits to acquire, as of
the Closing Date, from such Seller a participation in the Letters of Credit
equal to one hundred percent (100%) of the amount thereof.
(c) Each Seller agrees that, with respect to each request by a beneficiary
for a draw under or payment of a Letter of Credit, (a "Request"), it will (i)
promptly provide, by facsimile sent to Purchaser, copies of documents submitted
to support any Request; (ii) wait 24 hours, or such shorter time period as may
be required under such Letter of Credit, after sending the facsimile before
acting on a Request; (iii) act in accordance with ISP98, UCP 500 and/or UCC
Article 5, as applicable, in deciding whether or not to honor the Request unless
directed in writing by Purchaser to otherwise honor or dishonor a Request; (iv)
provide notice to Purchaser that the Request has been honored and the amount of
the Letter of Credit Disbursement that may become due pursuant to Subsection
12.11(d), below; and (v) after honoring a Request, send the documents submitted
by the beneficiary in support of a Request as directed by Purchaser.
(d) In the event a Seller notifies Purchaser that a Letter of Credit
Disbursement has been made and that either (A) the affected Customer has failed
to immediately reimburse such Letter of Credit Disbursement pursuant to its
Reimbursement Agreement or (B) the related Reimbursement Agreement does not
require that the affected Customer immediately reimburse such Seller for such
Letter of Credit Disbursement, then, Purchaser agrees to pay to the applicable
Seller on the day so notified by such Seller, an amount equal to the Letter of
Credit Disbursement; PROVIDED, HOWEVER, if such notice was not given by such
Seller to Purchaser prior to 2 p.m. on such day, then such amount shall be paid
by Purchaser not later than 10:00 a.m. on the next Business Day. Whenever any
amounts are due and payable by Purchaser pursuant to this Subsection 12.11(d),
the applicable Seller agrees to submit a draw request to Purchaser in accordance
with the terms of the Purchaser's Letter of Credit stating the amount due
hereunder. Purchaser agrees to pay the applicable Seller any amounts due under
this Subsection 12.11(d) by wire transfer of immediately available funds to an
account previously designated by such Seller.
(e) Purchaser also agrees to pay the applicable Seller (i) interest on any
and all amounts unpaid by Purchaser when due under Subsection 12.11(d), above,
from the date such amounts become due until payment in full, such interest being
payable on demand and accruing at a fluctuating interest rate per annum
(computed on the basis of a year of 365 days for the actual number of days
elapsed) which shall at all times be equal to the Federal Funds Rate during each
day until such amounts are paid in full (but such fluctuating interest rate
shall in no event be higher than the maximum rate permitted by then applicable
law) and (ii) any and all costs and expenses (including, without limitation,
reasonable attorneys' fees) reasonably incurred by Sellers in exercising or
enforcing any rights or performing any obligations under Sections 12.11(d) and
(e).
(f) So long as Purchaser is not in default of its obligations under this
Section 12.11, Sellers shall promptly remit to Purchaser any amounts
subsequently received by Sellers from Customers in respect of all Letter of
Credit Disbursements.
(g) Sellers further agree that they will not, without the prior written
consent of Purchaser, amend or modify the terms of any Letter of Credit or
Reimbursement Agreement. Purchaser and Sellers acknowledge and agree that with
respect to all Letters of Credit the expiry date of which is, by the terms
thereof, automatically extended, (x) each Seller shall give notice in accordance
with the terms of such
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Letters of Credit that such Seller will not extend such expiry date beyond the
current expiry date unless Purchaser and such Seller mutually agree to permit
the extension of such Letter of Credit and (y) no Seller shall otherwise extend
a Letter of Credit without Purchaser's consent.
(h) Purchaser shall pay to Fleet a fee with respect to the Outstanding
Credit Exposure computed (on the basis of a year of 365 days for the actual
number of days elapsed) at a rate per annum determined in good faith to be fair
and reasonable by the parties hereto, taking into consideration the long-term
debt rating of Purchaser and Independent if such rating exists. Such fee shall
be payable quarterly in arrears on each June 30, September 30, December 31 and
March 31, commencing on the quarter end immediately following the Closing Date,
and shall be calculated on the average daily outstanding Credit Exposure during
each such period. The initial fee shall be appropriately pro-rated.
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Section 12.12. ACTIONS WITH RESPECT TO IRA, KEOGH PLAN AND EMPLOYEE
PENSION PLAN DEPOSIT LIABILITIES.
(a) On or before the Closing Date, each Seller shall (i) resign as of the
close of business on the Closing Date as the trustee or custodian, as
applicable, of each IRA, Keogh Plan and Employee Pension Plan of which it is the
trustee or custodian, (ii) to the extent permitted by the documentation
governing each such IRA, Keogh Plan or Employee Pension Plan and applicable law,
appoint Purchaser as successor trustee or custodian, as applicable, of each such
IRA, Keogh Plan or Employee Pension Plan, and Purchaser hereby accepts each such
trusteeship or custodianship under the terms and conditions of Purchaser's plan
documents for its IRA, Keogh Plans and Employee Pension Plan, and assumes all
fiduciary and custodial obligations with respect thereto as of the close of
business on the Closing Date, and (iii) deliver to the IRA grantor or Keogh Plan
or Employee Pension Plan named fiduciary of each such IRA, Employee Pension Plan
or Keogh Plan such notice of the foregoing as is required by the documentation
governing each such IRA, Employee Pension Plan or Keogh Plan or applicable law.
Purchaser shall be solely responsible for delivering its IRA, Employee Pension
Plan and Keogh Plan documents to the applicable IRA grantor and Keogh Plan or
Employee Pension Plan named fiduciary, including but not limited to a
beneficiary designation form to be completed by the applicable IRA grantor or
Keogh Plan or Employee Pension Plan participant; provided, however, that in the
event that an IRA grantor or Keogh Plan or Employee Pension Plan participant
dies before such time as Purchaser receives a properly completed beneficiary
designation form, Sellers shall make available to Purchaser such information as
may exist in Sellers' files regarding any beneficiary designation it may have
regarding such decedent. If, pursuant to the terms of the documentation
governing any such IRA or Keogh Plan or Employee Pension Plan or applicable law,
(X) a Seller is not permitted to appoint Purchaser as successor trustee or
custodian, or the IRA grantor or Keogh Plan or Employee Pension Plan named
fiduciary objects in writing to such designation, or is entitled to, and does,
in fact, name a successor trustee or custodian other than Purchaser, or (Y) such
IRA or Keogh Plan or Employee Pension Plan includes assets which are not Deposit
Liabilities and are not being transferred to Purchaser or the assumption of such
deposit liabilities included in such IRA or Keogh Plan or Employee Pension Plan
would result in a loss of qualification of such IRA or Keogh Plan or Employee
Pension Plan under the Code or applicable IRS regulations, all deposit
liabilities of such Seller held under such IRA or Keogh Plan or Employee Pension
Plan shall be excluded from the Deposit Liabilities (such excluded deposits
liabilities being herein called the "Excluded IRA/Keogh/Employee Pension Plan
Deposits"). Upon appointment as a successor custodian for such IRA Deposit
Liabilities or as a successor trustee for such IRAs or Keogh Plans or Employee
Pension Plans, Purchaser shall perform the services and carry out the duties and
obligations required of it under the applicable plans, the Code and applicable
Federal and state laws and regulations.
(b) To the extent the Deposit Liabilities include certain IRAs, Keogh
Plans and Employee Pension Plans that are required to make certain periodic
distributions to the IRA account owner or Keogh Plan or Employee Pension Plan
participant (or beneficiary) either at the account owner's or participant's
request or because the account owner or participant has attained age 70-1/2,
effective as of the Transfer Date, Purchaser agrees to continue to make such
periodic distributions in accordance with the reasonable distribution
instructions forwarded by Sellers to Purchaser. Purchaser hereby assumes the
obligation to pay each minimum distribution required by federal law by December
31 of the calendar year in which the Closing occurs and, in consideration
thereof, Sellers agree not to withhold the amount of such distributions from the
aggregate amount of the Deposit Liabilities.
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Section 12.13. BULK TRANSFER LAWS. Sellers and Purchaser hereby waive
compliance with any applicable bulk transfer laws. If by reason of any
applicable bulk sales law any claims are asserted by creditors of a Seller, such
claims shall be the responsibility of Purchaser in the case of claims arising
under any of the Purchased Assets or Assumed Liabilities.
Section 12.14. ANCILLARY AGREEMENTS. At the Closing, Purchaser and Sellers
will enter into the Purchaser's Letter of Credit and the Collateral Agency
Agreement.
ARTICLE XIII
CONDITIONS TO CLOSING
Section 13.1. CONDITIONS TO OBLIGATIONS OF SELLERS AND FLEET. The
obligations of each Seller and Fleet under this Agreement are subject to the
satisfaction (or, if applicable, waiver in the sole discretion of Sellers,
except as to the condition described in 13.1(c)) on or before the Closing Date,
of each of the following conditions:
(a) All of the covenants and other agreements required by this Agreement
to be complied with and performed by Purchaser and/or Independent on or before
the Closing Date shall have been duly complied with and performed in all
material respects;
(b) The representations and warranties made by Purchaser and/or
Independent herein or in any certificate or other document delivered pursuant to
the provisions hereof or in connection with the transactions contemplated hereby
shall be true and correct in all material respects, on and as of the Closing
Date, with the same force and effect as though such representations and
warranties had been made on the Closing Date provided, however, that the
representations and warranties of Purchaser or Independent herein or in any
certificate or other document delivered pursuant to the provisions hereof shall
be deemed to be true and correct in all material respects on and as of the
Closing Date, with the same force and effect as though made on the Closing Date,
unless the failure to be so true and correct would have a material adverse
effect on Purchaser's ability to consummate the transactions contemplated by the
Agreement;
(c) All Regulatory Approvals shall have been obtained and shall be Final;
(d) No court or governmental or regulatory authority of competent
jurisdiction shall have enacted, issued, promulgated, enforced or entered any
statute, rule, regulation, judgment, decree, injunction or other order (whether
temporary, preliminary or permanent) which is in effect to enjoin, or which
prohibits, consummation of the transactions contemplated hereby;
(e) Sellers shall have received the items to be delivered by Purchaser
pursuant to Section 5.3.; and
(f) The transactions contemplated by the Merger Agreement shall have been
consummated.
Section 13.2. CONDITIONS TO OBLIGATIONS OF PURCHASER AND INDEPENDENT. The
obligations of Purchaser under this Agreement are subject to the satisfaction
(or, if applicable, waiver in the sole
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discretion of Purchaser, except as to the condition described in Section
13.2(c)) on or before the Closing Date, of each of the following conditions;
(a) All of the covenants and agreements required by this Agreement to be
complied with and performed by Sellers or Fleet on or before the Closing Date
shall have been duly complied with and performed in all material respects;
provided, however, that Fleet and Sellers shall be deemed to have duly complied
with and performed such covenants and agreements in all material respects unless
the failure to so perform or comply would have a Material Adverse Effect;
(b) The representations and warranties made by Sellers or Fleet herein or
in any certificate or other document delivered pursuant to the provisions hereof
or in connection with the transactions contemplated hereby shall be true and
correct in all material respects, on and as of the Closing Date, with the same
force and effect as though such representations and warranties had been made on
the Closing Date; provided, however, that the representations and warranties
made by Sellers or Fleet herein or in any certificate or other document
delivered pursuant to the provisions hereof shall be deemed to be true and
correct in all material respects on and as of the Closing Date, with the same
force and effect as though made on the Closing Date, unless the failure to be so
true and correct would have a Material Adverse Effect;
(c) The Regulatory Approvals shall have been obtained and shall be Final;
(d) No court or governmental or regulatory authority of competent
jurisdiction shall have enacted, issued, promulgated, enforced or entered any
statute, rule, regulation, judgment, decree, injunction or other order (whether
temporary, preliminary or permanent) which is in effect to enjoin, or which
prohibits, consummation of the transactions contemplated hereby;
(e) Purchaser shall have received the items to be delivered by Sellers
pursuant to Section 5.2; and
(f) Independent shall have consummated the Capital Transaction.
ARTICLE XIV
DATA PROCESSING
Section 14.1. CONVERSION.
(a) Sellers and Purchaser shall convert account information as to the
Deposit Liabilities and the Loans in accordance with the provisions of SCHEDULE
14.1 hereof.
(b) All tasks and obligations concerning the provision of data processing
services to or for the Branches after the Closing Date, other than those
specifically set forth in, and to the extent assumed by Sellers pursuant to,
SCHEDULE 14.1 hereof shall be performed solely and exclusively by Purchaser.
Purchaser acknowledges its assumption of all such tasks and obligations, and
further acknowledges that any delay, failure, or inability on its part to
perform such tasks or comply with such obligations, except as and to the extent
attributable to any delay, failure, or inability on the part of Sellers in
performing those tasks or complying with those obligations specifically set
forth in, and to the extent assumed by Sellers pursuant to, SCHEDULE 14.1 hereof
shall not result in any liability or obligation of Sellers and shall not affect
any of the rights of Sellers under this Agreement.
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ARTICLE XV
INDEMNITY
Section 15.1. FLEET'S INDEMNITY. Fleet shall indemnify, hold harmless and
defend Purchaser, its Affiliates, and their respective successors, permitted
assigns, directors, shareholders, officers, agents and employees from and
against all claims, losses, liabilities, demands and obligations of any nature
whatsoever (including reasonable legal fees and expenses) (collectively,
"Damages") which Purchaser or any of its Affiliates or their respective
successors, permitted assigns, directors, shareholders, officers, agents or
employees shall receive, suffer or incur, arising out of or resulting from:
(a) Any liability of Sellers which is not an Assumed Liability;
(b) The breach of any representation or warranty made by a Seller or Fleet
in this Agreement;
(c) The breach of any covenant or other agreement made by a Seller or
Fleet in this Agreement; or
(d) Except for Assumed Liabilities, all liabilities under all pension and
welfare benefit plans (as defined in Sections 3(1) and (2) of ERISA), or any
supplemental unemployment benefit, deferred compensation, or other employee
benefit plan of Sellers or their Affiliates with respect to any and all periods
prior to and subsequent to the Closing Date, including without limitation, all
liabilities under ERISA, any liabilities for any accumulated funding deficiency
as such term is defined in Section 302 of ERISA and Section 412 of the Code and
for any liability to the Pension Benefit Guaranty Corporation, the IRS,
participants, beneficiaries, employees, or any other public or private person,
incurred with respect to or attributable to any plan of Sellers.
Section 15.2. INDEPENDENT INDEMNITY. Independent shall indemnify, hold
harmless and defend Sellers, their Affiliates and their respective successors,
permitted assigns, directors, shareholders, officers, agents and employees from
and against all Damages which Sellers or any of their Affiliates or their
respective successors, permitted assigns, directors, shareholders, officers,
agents or employees shall receive, suffer or incur, arising out of or resulting
from:
(a) Any Assumed Liability;
(b) Any actions taken or omitted to be taken by Purchaser from and after
the date hereof with respect to the Consumer Bank Employees or the Consumer Bank
Related Employees, and any suits or proceedings commenced in connection
therewith;
(c) Any actions taken or omitted to be taken by Purchaser after the
Closing and relating to the Purchased Assets, Assumed Liabilities and the
Transferred Employees, and any suits or proceedings commenced in connection
therewith (other than proceedings to prevent or limit the consummation of the
transactions contemplated by this Agreement);
(d) The breach of any representation or warranty made by Purchaser or
Independent in this Agreement;
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(e) The breach of any covenant or other agreement made by Purchaser or
Independent in this Agreement; and
(f) Any claims arising under any of the Purchased Assets or Assumed
Liabilities made by creditors of any Seller under any applicable bulk sales
laws.
Section 15.3. INDEMNIFICATION PROCEDURE. If a party entitled to
indemnification hereunder ("Indemnified Party") is aware that a claim, demand or
other circumstance exists that has given or may reasonably be expected to give
rise to a right of indemnification under this Article XV (whether or not the
amount of the claim is then quantifiable), such Indemnified Party shall promptly
give written notice thereof to the other party ("Indemnitor"), and the
Indemnified Party will thereafter keep the Indemnitor reasonably informed with
respect thereto, provided that failure of the Indemnified Party to give the
Indemnitor prompt notice as provided herein shall not relieve the Indemnitor of
its obligations hereunder except to the extent, if any, that the Indemnitor's
rights shall have been prejudiced or the Indemnitor's liability shall have been
materially increased thereby. In case any such action, suit or proceeding is
brought against an Indemnified Party, the Indemnitor shall be entitled to
participate in (and, in its discretion, to assume) the defense thereof with
counsel reasonably satisfactory to the Indemnified Party, provided, however,
that the Indemnified Party shall be entitled to participate in any such action,
suit or proceeding with counsel of its own choice at the expense of the
Indemnitor if, in the good faith judgment of the Indemnified Party's counsel,
representation by the Indemnitor's counsel may present a conflict of interest or
there may be defenses available to the Indemnified Party which are different
from or in addition to those available to the Indemnitor. The Indemnitor will
not settle any claim, action, suit or proceeding which would give rise to the
Indemnitor's liability under its indemnity unless such settlement includes as an
unconditional term thereof the giving by the claimant or plaintiff of a release
of the Indemnified Party, in form and substance reasonably satisfactory to the
Indemnified Party and its counsel, from all liability with respect to such
claim, action, suit or proceeding. If the Indemnitor assumes the defense of any
claim, action, suit or proceeding as provided in this Section 15.3, the
Indemnified Party shall be permitted to join in the defense thereof with counsel
of its own selection and at its own expense. If the Indemnitor shall not assume
the defense of any claim, action, suit or proceeding, the Indemnified Party may
defend against such claim, action, suit or proceeding in such manner as it may
deem appropriate, provided that an Indemnified Party shall not settle any claim,
action, suit or proceeding which would give rise to the Indemnitor's liability
under its indemnity without the prior written consent of the Indemnitor, which
consent shall not be unreasonably withheld.
Section 15.4. LIMITATIONS ON LIABILITY. Notwithstanding anything to the
contrary contained in this Article XV, no party shall be entitled to
indemnification pursuant to Section 15.1(b) or 15.2(d) until its aggregate
Damages shall be in excess of one hundred thousand dollars ($100,000), at which
time such party shall be entitled to indemnification for the full amount of its
Damages to the extent such Damages exceed such amount. In no event shall the
Damages payable by Fleet in the aggregate exceed the Purchase Price and in no
event shall any party be entitled to any incidental, consequential, special,
exemplary or punitive Damages.
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Section 15.5. GENERAL.
(a) Each Indemnified Party shall be obligated in connection with any claim
for indemnification under this Article XV to use all commercially reasonable
efforts to obtain any insurance proceeds available to such Indemnified Party
with regard to the applicable claims. The amount which any Indemnitor is or may
be required to pay to any Indemnified Party pursuant to this Article XV shall be
reduced (retroactively, if necessary) by any insurance proceeds or other amounts
actually recovered (net of any direct relevant collections costs) by or on
behalf of such Indemnified Party in reduction of the related Damages. If an
Indemnified Party shall have received the payment required by this Agreement
from the Indemnitor in respect of Damages and shall subsequently receive
insurance proceeds or other amounts in respect of such Damages, then such
Indemnified Party shall promptly repay to the Indemnitor a sum equal to the
amount of such insurance proceeds or other amounts actually received (net of any
direct relevant collection costs). The amount of any Damages arising from a
breach by a Seller of the representation set forth Section 6.7(a) due to the
existence of a Lien which is not in respect of borrowed money and does not
materially impair the continued use and operation of any of the Purchased Assets
shall be limited to the lesser of (x) the cost of satisfying or removing such
Lien and (y) the actual impairment to the Purchased Asset caused by the
existence of such Lien.
(b) In addition to the requirements of paragraph (a) above, each
Indemnified Party shall be obligated in connection with any claim for
indemnification under this Article XV to use all commercially reasonable efforts
to mitigate Damages upon and after becoming aware of any event which could
reasonably be expected to give rise to such Damages.
(c) Subject to the rights of existing insurers of an Indemnified Party, an
Indemnitor shall be subrogated to any right of action which the Indemnified
Party may have against any other Person with respect to any matter giving rise
to a claim for indemnification from such Indemnitor hereunder.
(d) Except for the parties' rights to specific performance and injunctive
relief as described in Section 17.14, the indemnification provided in this
Article XV shall be the exclusive post-Closing Date remedy available to any
Indemnified Party with respect to any breach of any representation, warranty,
covenant or agreement made by Purchaser or Sellers in this Agreement. The
parties hereto further acknowledge that no indemnity shall be payable for any
Damages with respect to any breach of representations or warranties in this
Agreement if prior to Closing such party receives a written notice from the
other party (i) disclosing such breach or breaches and (ii) informing such party
that such breach or breaches constitute a Material Adverse Effect.
(e) All indemnification payments under this Article XV shall be deemed
adjustments to the Purchase Price as defined in Section 3.1 of Article III.
Section 15.6. SURVIVAL. All representations, warranties and covenants
contained in or made pursuant to this Agreement shall survive the execution and
delivery of the Agreement and shall continue in full force and effect for a
period of one (1) year after the Closing Date and thereafter shall terminate,
except as to any claim for which written notice shall have been given prior to
such date; and provided, further, that all covenants or agreements which by
their terms are to be performed after the first anniversary of the Closing Date
shall survive until fully discharged.
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ARTICLE XVI
POST-CLOSING MATTERS
Section 16.1. FURTHER ASSURANCES. From and after the Closing Date:
(a) Except as specifically provided otherwise herein, Sellers shall assist
Purchaser in the orderly transition of the operations of the Business and shall
give such further assurances and execute, acknowledge and deliver all such
instruments as may be necessary and appropriate to effectively vest in Purchaser
title in the Purchased Assets in the manner contemplated hereby; provided that
Sellers need not incur any out-of-pocket costs or expenses in connection with
its agreements in this Section 16.1 unless such costs or expenses are reimbursed
by Purchaser.
(b) Except as specifically provided otherwise herein, Purchaser shall give
such further assurances to Sellers and shall execute, acknowledge and deliver
all such acknowledgments and other instruments and take such further action as
may be necessary and appropriate to effectively relieve and discharge Sellers
from any obligations remaining with respect to the Deposit Liabilities or other
Assumed Liabilities; provided that Purchaser need not incur any out-of-pocket
costs or expenses in connection with its agreements in this Section 16.1 unless
such out-of-pocket costs or expenses are reimbursed by Sellers.
Section 16.2. ACCESS TO AND RETENTION OF BOOKS AND RECORDS. For a period
of six (6) years from the Closing Date, each party shall have commercially
reasonable access to any books and records of the other party relating to the
Purchased Assets and the Assumed Liabilities, and the requesting party, at its
own expense, may make copies and extracts when such copies and extracts are
required by regulatory authorities, for litigation purposes, or for tax or
accounting purposes; provided that in the event that as of the end of such
period, any tax year of Sellers is under examination by any taxing authority,
such books and records shall be maintained by Purchaser until a final
determination of the tax liability of Sellers for that year has been made. If
such copies or extracts require use of a party's equipment or facilities, the
user shall reimburse the other party for all costs incurred, including without
limitation employee expenses.
Section 16.3. DEPOSIT HISTORIES. In case of any dispute with or inquiry by
any Customer whose Deposit Liability account is included in the Assumed
Liabilities, which dispute or inquiry relates to the servicing of such account
by Sellers prior to the date for which a deposit history has been provided to
Purchaser, Sellers will provide Purchaser, where available and to the extent
reasonably requested by Purchaser and not already provided to Purchaser,
information regarding the Deposit Liability account and copies of pertinent
documents or instruments with respect to such dispute or inquiry so as to permit
Purchaser to respond to such Customer within a period of time and in a manner
which would comply with standard banking practices and customs and all
applicable laws.
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ARTICLE XVII
MISCELLANEOUS
Section 17.1. EXPENSES.
(a) Except as otherwise provided herein, Sellers and Purchaser shall each
pay all of their own out-of-pocket expenses in connection with this Agreement,
including investment banking, appraisal, accounting, consulting, professional
and legal fees, if any, whether or not the transactions contemplated by this
Agreement are consummated.
(b) Purchaser shall pay all (i) recording, filing or other fees, cost and
expenses (including without limitation fees, costs and expenses for (w)
preparation of title commitments, abstracts or searches, surveys, inspections,
environmental audits or other investigations, (x) filing of any forms (including
without limitation tax forms) with governmental authorities in connection with
the transfer of the Real Property or Fixed Assets, (y) recording instruments or
documents evidencing any transfers of interests in real property), and (z) any
real property transfer stamps or taxes imposed on any transfers or interest in
Real Property and any fees or charges payable to landlords in connection with
Landlord Consents; provided that Sellers shall pay all such fees, costs or
expenses with respect to matters described in (x), (y) and (z) which Sellers are
required by law to pay and which are customarily paid by a seller of property in
the applicable jurisdiction; and (ii) costs and expenses relating to the
preparation, execution and recording of assignments of mortgages, financing
statements, notes, security agreements or other instruments applicable to or
arising in connection with the transfer, assignment or assumption of the
Purchased Assets and Assumed Liabilities including, but not limited to, fees
payable to the SBA in connection with the transfer to Purchaser of the SBA
Loans.
Section 17.2. TRADE NAMES AND TRADEMARKS.
(a) The Purchaser acknowledges and agrees that notwithstanding anything to
the contrary contained herein, it has, and following the Closing shall have, no
interest in or to the names "Fleet", "BankBoston", "Fleet Boston" or any trade
name, trademark or service mark, logo or corporate name of Sellers, Fleet,
BankBoston or any of their respective Affiliates, including, without limitation,
the tradenames and trademarks listed on SCHEDULE 17.2 hereto. After the Closing
Date, Independent shall not permit Purchaser or any of its Affiliates to use any
of the trade names, trademarks, service marks, logos or corporate names of
Sellers, Fleet, BankBoston or any of their respective Affiliates including,
without, limitation, the tradenames and trademarks listed on Schedule 17.2
hereto.
(b) From and after the Closing, Purchaser agrees not to use any forms or
other documents bearing any name or logo of Sellers, or the name or logo of any
Affiliate of Sellers, without the prior written consent of Sellers, which
consent may be denied or given in Sellers' sole discretion. If such consent is
given, Purchaser hereby agrees that all forms or other documents to which such
consent relates will be stamped or otherwise marked in such a way that
identifies Purchaser as the party using the form or document.
Section 17.3. TERMINATION; EXTENSION OF CLOSING DATE. This Agreement shall
terminate and shall be of no further force or effect as between the parties
hereto, except as to the liability for actual direct damages due to a willful
breach of any material representation, warranty or covenant occurring or arising
prior to the date of termination, upon the occurrence of any of the following:
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(a) Upon mutual agreement of the parties;
(b) Upon written notice by either Purchaser or Sellers to the other
parties immediately upon receipt by Purchaser or Sellers of notice from any
governmental authority that Purchaser or Sellers, as the case may be, has been
denied any Regulatory Approval by Final order;
(c) Upon written notice by either Purchaser or Sellers to the other
parties, if the Closing has not occurred by September 30, 2000;
(d) By either Purchaser or Sellers (provided that the terminating party is
not then in material breach of any representation, warranty, covenant or other
agreement contained herein) if there shall have been a material breach of any of
the representations, warranties, covenants or other agreements set forth in this
Agreement on the part of the other party, which breach is not cured within
thirty (30) days following written notice to the party committing such breach,
or which breach, by its nature, cannot be cured prior to the Closing; provided,
however, that Purchaser shall not have the right to terminate this Agreement
pursuant to this Section 17.3(d) unless the breach of representation, warranty,
covenant, or other agreement together with all other such breaches would have a
Material Adverse Effect;
(e) By Sellers upon written notice if Independent shall not have completed
the Capital Transaction and the Capital Infusion by February 15, 2000 or if
Independent and Purchaser have not obtained the Purchaser's Regulatory Approvals
by February 15, 2000; or
(f) By Sellers at any time by notice to Purchaser if the Merger Agreement
is terminated for any reason.
Section 17.4. MODIFICATION AND WAIVER. No modification of any provision of
this Agreement shall be binding unless in writing and executed by the party or
parties sought to be bound thereby. Performance of or compliance with any
covenant given herein or satisfaction of any condition to the obligations of
either party hereunder may be waived by the parties to whom such covenant is
given or whom such condition is intended to benefit, except as otherwise
provided in this Agreement or to the extent any such condition is required by
law; provided, that, any such waiver must be in writing.
Section 17.5. BINDING EFFECT; ASSIGNMENT. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
successors and permitted assigns; provided, however, that neither this Agreement
nor any rights, privileges, duties or obligations of the parties hereto may be
assigned without the prior written consent of the other parties hereto.
Section 17.6. CONFIDENTIALITY.
(a) From and after the date hereof, the parties hereto and their
Affiliates shall keep confidential the terms of this Agreement and the
negotiations relating hereto and all documents and information obtained by a
party from another party in connection with the transactions contemplated
hereby, except (i) to the extent this Agreement and such negotiations need to be
disclosed to obtain a Regulatory Approval, (ii) for disclosures made in
accordance with the terms of this Agreement, and (iii) to the extent required by
applicable law, regulations or rules of the National Association of Securities
Dealers, any applicable national securities exchange or the Securities and
Exchange Commission. This section shall survive any termination of this
Agreement.
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(b) Except as otherwise required by law, regulations or rules, including
the rules of any self regulatory organization (as defined in the Securities
Exchange Act of 1934, as amended), the parties hereto shall each furnish to the
other the text of all notices and communications, written or oral, proposed to
be sent by the furnishing party regarding the transactions contemplated hereby.
Except as otherwise required by law, regulations or rules of the National
Association of Securities Dealers or any national stock exchange, the furnishing
party shall not send or transmit such notices or communications or otherwise
make them public unless and until the consent of the other parties is received,
which consent shall not be unreasonably withheld or delayed. This section shall
survive any termination of this Agreement.
(c) Purchaser and Sellers shall issue mutually agreed upon press releases
on the date of this Agreement and on the Closing Date or the first Business Day
thereafter.
Section 17.7. ENTIRE AGREEMENT; GOVERNING LAW. This Agreement, together
with the exhibits and schedules attached hereto and made a part hereof, contains
the entire agreement between the parties hereto with respect to the transactions
covered and contemplated hereunder, and supersedes all prior agreements or
understandings between the parties hereto relating to the subject matter hereof,
provided that the terms of the Confidentiality Agreement, to the extent not
inconsistent with the terms hereof, shall continue to apply. This Agreement
shall be governed by and construed in accordance with the laws of the
Commonwealth of Massachusetts (without reference to conflicts or choice of law
provisions).
Section 17.8. CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL. EACH PARTY
HERETO, TO THE EXTENT IT MAY LAWFULLY DO SO, HEREBY SUBMITS TO THE JURISDICTION
OF THE COURTS OF THE COMMONWEALTH OF MASSACHUSETTS AND THE UNITED STATES
DISTRICT COURT FOR THE DISTRICT OF MASSACHUSETTS, AS WELL AS TO THE JURISDICTION
OF ALL COURTS FROM WHICH AN APPEAL MAY BE TAKEN OR OTHER REVIEW SOUGHT FROM THE
AFORESAID COURTS, FOR THE PURPOSE OF ANY SUIT, ACTION OR OTHER PROCEEDING
ARISING OUT OF SUCH PARTY'S OBLIGATIONS UNDER OR WITH RESPECT TO THIS AGREEMENT
OR ANY OF THE AGREEMENTS, INSTRUMENTS OR DOCUMENTS CONTEMPLATED HEREBY (OTHER
THAN THE CONFIDENTIALITY AGREEMENT), AND EXPRESSLY WAIVES ANY AND ALL OBJECTIONS
IT MAY HAVE AS TO VENUE IN ANY OF SUCH COURTS.
EACH PARTY HERETO HEREBY WAIVES TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM ARISING OUT OF OR IN ANY WAY CONCERNED WITH THIS AGREEMENT OR ANY
OF THE AGREEMENTS, INSTRUMENTS OR DOCUMENTS CONTEMPLATED HEREBY. NO PARTY
HERETO, NOR ANY ASSIGNEE OR SUCCESSOR OF A PARTY HERETO SHALL SEEK A JURY TRIAL
IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM OR ANY OTHER LITIGATION PROCEDURE BASED
UPON, OR ARISING OUT OF, THIS AGREEMENT OR ANY OF THE AGREEMENTS, INSTRUMENTS OR
DOCUMENTS CONTEMPLATED HEREBY. NO PARTY WILL SEEK TO CONSOLIDATE ANY SUCH
ACTION, IN WHICH A JURY TRIAL HAS BEEN WAIVED, WITH ANY OTHER ACTION IN WHICH A
JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS HAVE BEEN
FULLY DISCUSSED BY THE PARTIES HERETO, AND THE PROVISIONS SHALL BE SUBJECT TO NO
EXCEPTIONS. NO PARTY HAS IN ANYWAY AGREED WITH OR REPRESENTED TO ANY OTHER PARTY
THAT THE PROVISIONS OF THIS SECTION WILL NOT BE FULLY ENFORCED IN ALL INSTANCES.
Section 17.9. WAIVER OF CERTAIN DAMAGES. EACH OF THE PARTIES HERETO TO THE
FULLEST EXTENT PERMITTED BY LAW IRREVOCABLY WAIVES ANY RIGHTS THAT THEY MAY HAVE
TO PUNITIVE,
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SPECIAL, INCIDENTAL, EXEMPLARY OR CONSEQUENTIAL DAMAGES IN RESPECT OF ANY
LITIGATION BASED UPON, OR ARISING OUT OF, THIS AGREEMENT OR ANY RELATED
AGREEMENT OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS OR ACTIONS OF
ANY OF THEM RELATING THERETO.
Section 17.10. SEVERABILITY. In the event that any provision of this shall
be held invalid, illegal, or unenforceable in any respect, the validity,
legality, and enforceability of the remaining provisions contained in this
Agreement shall not in any way be affected or impaired thereby, and this
Agreement shall otherwise remain in full force and effect.
Section 17.11. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective when one or more counterparts have been signed by each of
the parties hereto.
Section 17.12. NOTICES. All notices, consents, requests, instructions,
approvals, waivers, stipulations and other communications provided for herein to
be given by one party hereto to the other party shall be deemed validly given,
made or served, if in writing and delivered personally or sent by certified
mail, return receipt requested, nationally recognized overnight delivery
service, or facsimile transmission, if to Sellers or to Fleet addressed to:
Fleet Financial Group, Inc.
One Federal Street
37th Floor
Boston, MA 02110
Attention: Brian T. Moynihan
Facsimile number: (617) 346-0137
with copies to:
William C. Mutterperl, Esq.
Executive Vice President, General Counsel and Secretary
Fleet Financial Group, Inc.
One Federal Street
37th Floor
Boston, MA 02110
Facsimile number: (617) 346-0131
and to:
V. Duncan Johnson, Esq.
Edwards & Angell, LLP
2800 BankBoston Plaza
Providence, RI 02903-2499
Facsimile number: (401) 276-6625
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and if to Purchaser addressed to:
Richard J. Seaman
Chief Financial Officer
Rockland Trust Company
288 Union Street
Rockland, MA 02370
Facsimile Number: (781) 982-6113
with a copy to:
Susan M. Barnard, Esq.
Sullivan & Worcester LLP
One Post Office Square
Boston, MA 02109
Facsimile Number: (617) 338-2880
Notice by certified mail shall be deemed to be received three (3) Business
Days after mailing of the same. Either party may change the persons or addresses
to whom or to which notices may be sent by written notice to the others.
Section 17.13. INTERPRETATION. Article titles, headings to sections and
any table of contents are inserted for convenience of reference only and are not
intended to be a part of or to affect the meaning or interpretation hereof. The
Schedules and Exhibits referred to herein shall be construed with and as an
integral part of this Agreement to the same extent as if they were set forth
verbatim herein. As used herein, "include", "includes" and "including" are
deemed to be followed by "without limitation" whether or not they are in fact
followed by such words or words of like import; "writing", "written" and
comparable terms refer to printing, typing , lithography and other means of
reproducing words in a visible form; references to a person are also to its
successors and assigns; except as the context may otherwise require, "hereof",
"herein", "hereunder" and comparable terms refer to the entirety hereof and not
to any particular article, section or other subdivision hereof or attachment
hereto; references to any gender include the other; except as the context may
otherwise require, the singular includes the plural and vice versa; references
to any agreement or other document are to such agreement or document as amended
and supplemented from time to time; references to "Article", "Section" or
another subdivision or to an "Exhibit" or "Schedule" are to an article, section
or subdivision hereof or an "Exhibit" or "Schedule". The parties acknowledge
that each party and its counsel have reviewed and revised this Agreement and
that the normal rule of construction to the effect that any ambiguities are to
be resolved against the drafting party shall not be employed in the
interpretation, construction and enforcement of this Agreement or any amendment,
schedule or exhibit hereto.
Section 17.14. SPECIFIC PERFORMANCE. The parties hereto acknowledge that
monetary damages could not adequately compensate either party hereto in the
event of a breach of this Agreement by the other, that the non-breaching party
would suffer irreparable harm in the event of such breach and that the
non-breaching party shall have, in addition to any other rights or remedies it
may have at law or in equity, specific performance and injunctive relief as a
remedy for the enforcement hereof.
Section 17.15. NO THIRD PARTY BENEFICIARIES. The parties hereto intend
that this Agreement shall not benefit or create any right or cause of action in
or on behalf of any person other than the parties
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hereto. No future or present employee or customer of either of the parties nor
their affiliates, successors or assigns or other person shall be treated as a
third party beneficiary in or under this Agreement.
Section 17.16. SURVIVAL. Except for Articles XV and XVI and Sections 17.1
and 17.2 and Sections 17.4 through 17.16 no representations, warranties,
covenants or agreements made by the parties herein shall survive termination of
this Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed, by their duly authorized representatives, as of the day and year
first above written.
FLEET FINANCIAL GROUP, INC.
By: /s/ H. Jay Sarles
--------------------------------------
Name: H. Jay Sarles
--------------------------------
Title: Vice Chairman
-------------------------------
FLEET NATIONAL BANK
By: /s/ H. Jay Sarles
--------------------------------------
Name: H. Jay Sarles
--------------------------------
Title: Executive Vice President
-------------------------------
BANKBOSTON, N.A.
By: /s/ Virginia J. Dorn
--------------------------------------
Name: Virginia J. Dorn
--------------------------------
Title: Director, Integration and
Divestiture Management
-------------------------------
ROCKLAND TRUST COMPANY
By: /s/ Douglas H. Philipsen
--------------------------------------
Name: Douglas H. Philipsen
--------------------------------
Title: Chairman, President and
Chief Executive Officer
-------------------------------
INDEPENDENT BANK CORP.
By: /s/ Douglas H. Philipsen
--------------------------------------
Name: Douglas H. Philipsen
--------------------------------
Title: Chairman, President and
Chief Executive Officer
-------------------------------
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INDEPENDENT Exhibit 99
BANK CORP.
Parent of Rockland Trust Company
SHAREHOLDER RELATIONS NEWS RELEASE
- --------------------------------------------------------------------------------
288 Union Street, Rockland, MA 02370
Contact: Douglas H. Philipsen
Chairman of the Board
President and
Chief Executive Officer
(781) 982-6613
Richard J. Seaman
Chief Financial Officer
(781) 982-6347
FOR IMMEDIATE RELEASE
INDEPENDENT BANK CORP. MAKES MAJOR ACQUISITION
COMPANY ACQUIRES 12 BRANCHES FROM FLEET FINANCIAL AND COMMERCIAL LOANS FROM
BANKBOSTON'S SMALL BUSINESS BANKING DEVELOPMENT REAL ESTATE PORTFOLIO
ROCKLAND, Massachusetts (September 27, 1999) -- Independent Bank Corp. (NASDAQ:
INDB) and its sole banking subsidiary, Rockland Trust Company, have entered into
a purchase and assumption agreement with Fleet Financial Group to acquire 12
Massachusetts branches totaling $269 million in deposits and $37 million in
consumer and SBA loans. In addition, the Company will purchase approximately
$113 million of commercial real estate loans at par from BankBoston, related to
its Small Business Banking Developmental Real Estate portfolio. The acquisitions
result from the divestiture of Fleet branches after its merger with BankBoston.
This transaction is contingent on regulatory approvals and the raising of
approximately $10 million of total risk-based (Tier 2) capital. It will not be
necessary to raise common equity.
The 12 branches include two in Brockton and 10 on Cape Cod. These branches are
located at:
BROCKTON
836 North Main Street
34 School Street
CAPE COD
Centerville -- 1195 Falmouth Road
Harwichport -- Main Street
<PAGE>
Hyannis -- 375 Iyanough Road
Mashpee -- Mashpee Rotary Circle, Route 28
PAGE 2: INDEPENDENT BANK CORP. ACQUISITION RELEASE
Orleans -- Main Street & Route 28
Osterville -- 22 Wianno Avenue
Pocasset -- 301B Barlows Landing
Sandwich -- Route 6A and Tupper Road
South Yarmouth -- 1123 Main Street
South Yarmouth -- 428 Station Avenue
These branches will continue to operate as Fleet offices until they are
converted to Rockland Trust in late Spring of 2000. All current Fleet employees
will be retained by Rockland Trust, and a special notification will be sent to
customers prior to the conversion.
Douglas H. Philipsen, Chairman, President and Chief Executive Officer of
Independent Bank Corp. and Rockland Trust Company stated that the acquisition of
these branches is a win for customers, communities, employees and shareholders.
"Our expansion into the Cape Cod market allows for better service to our current
customers as well as the opportunity to provide superior community-oriented
consumer, business and trust and investment services to a new market. The
branches are well situated and provide a strong foundation for serving the
entire Cape. The Small Business Banking Commercial Real Estate portfolio is
seasoned and provides good yields. Rockland Trust has long been active in this
business, and we understand it well."
Mr. Philipsen further stated, "The key to our success has been our 567 employees
who are dedicated to offering outstanding service. We look forward to Fleet and
BankBoston employees becoming part of our team."
Rockland Trust Company provides a full range of consumer, commercial, investment
and trust services throughout its current markets and will provide those same
services to the customers and businesses on the Cape. Following the closing of
this transaction, Independent Bank Corp. will have over $1.8 billion in assets,
46 retail branches including 36 in southeastern Massachusetts and 10 on Cape
Cod. The Company also operates eight commercial lending and two investment and
trust services offices.
