<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-K/A
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For fiscal year ended Commission File No.
December 31, 1994 33-14902
SOUTHERN BANK GROUP, INC.
(Exact name of registrant as specified in its charter)
Georgia 58-1723394
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
11180 Alpharetta Highway
Roswell, Georgia 30076
(Address of principal (Zip code)
executive offices)
Registrant's telephone number, including area code: (404) 475-2265
Securities registered pursuant to Section 12(b) of the Act:
None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $1.00 par value
(Title of Class)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities and
Exchange Act of 1934 during the preceding 12 months, and (2) has been subject
to such filing requirements for the past 90 days.
YES X NO
--------- ---------
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of the registrant's knowledge, in definitive proxy information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ ]
As of March 29, 1995, 1,838,601 shares of $1.00 par value Common Stock
of Southern Bank Group, Inc. ("Common Stock") were issued and outstanding and
the aggregate market value of the shares of $1.00 par value Common Stock held
by non-affiliates was approximately $19,763,430.
<PAGE> 2
<TABLE>
<CAPTION>
=====================================================================================================
NAME, ADDRESS POSITION WITH SOUTHERN
AND YEAR FIRST BANK GROUP AND COMMON STOCK
ELECTED A PRINCIPAL OCCUPATION BENEFICIALLY
DIRECTOR AGE DURING THE PAST FIVE YEARS OWNED(1)
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Trummie L. Patrick, Jr. 50 Mr. Patrick served as Chairman of the Board 44,564(6)
545 Coleman Drive of Directors of Southern Bank Group from 2.42%
Roswell, GA 30075 September 15, 1991 to May 5, 1994. From
(1987) September 15, 1991 to April 28, 1992, he
served as the acting President of Southern
Bank Group. Since 1973, Mr. Patrick has been
employed as an insurance agent for State
Farm Insurance. Mr. Patrick also serves as a
director of Northside Bank and serves as its
Chairman. Mr. Patrick served as the
Treasurer and Secretary of Southern Bank
Group from its organization until December
31, 1988.
John H. Isakson 50 Mr. Isakson is President of Northside 33,447(7)
5074 Hampton Farms Drive Realty, one of the largest residential 1.82%
Marietta, Georgia 30068 brokerage companies in the Southeast,
(1994) operating 23 offices in metro Atlanta. He
also serves as a member of the Advisory
Board of Trust Company Bank and is a member
of the Georgia State Senate, representing
Cobb County. He is a member of the Board of
Directors of Southern Bank Group, Inc.
=====================================================================================================
</TABLE>
<PAGE> 3
Notes to Table
(1) The information shown above is based upon information forwarded to
Southern Bank Group by the named persons. For purposes of this table, the term
"beneficial ownership" is used as defined in Rule 13d-3 under the Securities
Exchange Act of 1934, as amended ("Act"). Under applicable SEC rules the
number of outstanding shares of $1.00 par value common stock used in the
computation of the "Percent of Class" includes warrants and currently
exercisable incentive stock options owned by the shareholder.
(2) Includes 1,625 shares held as Trustee for Aderco, Inc. Profit Sharing
Plan.
(3) Includes 27,284 shares held by Philip Allgood as trustee for Allgood &
Associates Profit Sharing Plan, 2,800 shares in an Individual Retirement
Account for Mr. Allgood's benefit, 12,500 shares held as custodian for Pierce
Allgood, 125 shares held as custodian for Bob Simmons, 125 shares held as
custodian for Carl Worthy and 3,250 shares held for Allgood and Sawyer. Mr.
Allgood disclaims beneficial ownership for the shares held by him as custodian
for Pierce Allgood, Carl Worthy and Bob Simmons.
(4) Includes 3,550 shares held for Mr. Baggett's benefit in Habif, Arogeti
& Wynne, P.C. Retirement Plan.
(5) Includes 12,500 shares held as joint tenant with his wife.
(6) Includes 500 shares held as custodian for Amanda C. Patrick, 1,250
shares held as custodian for Estella T. Patrick, 5,250 shares held as
custodian for Sylvia R. Patrick, 2,500 shares held as custodian for Sydney E.
Patrick, 2,500 shares held as custodian for Trummie L. Patrick, III, 1,000
shares held in an Individual Retirement Account for Sylvia R. Patrick, 1,875
shares held as Trustee of the Trummie L. Patrick Insurance Agency, Inc.
Employee Plan, and 2,500 shares held for Mr. Patrick's benefit in an IRA by A.
G. Edwards & Sons, Inc. Mr. Patrick disclaims beneficial ownership of all
shares held by him as custodian and the shares held in the IRA for Sylvia R.
Patrick.
(7) Includes 2,336 shares held as custodian for Julie Gay Isakson, 1,074
shares held for Diane Davison Isakson, 1,961 shares held for Kevin Warner
Isakson, 1,961 shares held for John Andrew Isakson, 375 shares held as
custodian for John Andrew Isakson, 375 shares held as custodian for Kevin
Warner Isakson, and 2,666 shares for John H. and Diane Davison Isakson.
(8) Includes 2,500 shares owned by Seals & Associates, Inc. a corporation
which is owned by Mr. Seals and of which he serves as President.
<PAGE> 4
NOTE 6 - PREMISES AND EQUIPMENT
At December 31, 1994 and 1993, premises and equipment balances are as follows:
<TABLE>
<CAPTION>
Asset Lives
1994 1993 (in years)
=========================================================
<S> <C> <C>
Land . . . . . . . . . . . $1,439 $1,179
Building and leasehold
improvements . . . . . . $3,042 $2,598 5-31.5
Equipment, furniture
and fixtures . . . . . . 2,063 1,917 3-7
------ ------
6,544 5,694
Less: Accumulated
depreciation . . . . . . (2,297) (1,858)
Branch in progress . . . . -- 678
------ ------
$4,247 $4,514
====== ======
</TABLE>
Depreciation expense was $465, $471 and $398 for 1994, 1993 and 1992,
respectively.
<PAGE> 5
SIGNATURES.
- -----------
Pursuant to the requirements of Section 13 or 15(d) of the Securities and
Exchange Act of 1934, as amended, Southern Bank Group, Inc. has duly caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
SOUTHERN BANK GROUP, INC.
Date: June 7, 1995 By: /s/ E. Lamar Seals, Jr.
-----------------------
E. Lamar Seals, Jr.
Chairman of the Board of
Directors
Date: June 7, 1995 By: /s/ O. Lawrence Comer
---------------------
O. Lawrence Comer
Secretary
Date: June 7, 1995 By: /s/ Philip A. Allgood
---------------------
Philip A. Allgood
Director
Date: June 7, 1995 By: /s/ Thomas E. Aderhold
----------------------
Thomas E. Aderhold
Director
Date: June 7, 1995 By: /s/ Kenneth E. Baggett
----------------------
Kenneth E. Baggett
Director
Date: June 7, 1995 By: /s/ Burton L. Bridges
---------------------
Burton L. Bridges
Director
Date: June 7, 1995 By: /s/ John H. Isakson
-------------------
John H. Isakson
Director
Date: June 7, 1995 By: /s/ Trummie L. Patrick
----------------------
Trummie L. Patrick
Director
Date: June 7, 1995 By: /s/ Dana F. Ponder
------------------
Dana F. Ponder
Principal Accounting
Officer
<PAGE> 6
3. Exhibits
Exhibit
Number Description
------- -----------
2.1 Agreement and Plan of Merger of SouthTrust
of Georgia, Inc. and Southern Bank Group,
Inc. joined in by SouthTrust Corporation
(the "Merger Agreement") executed on
March 17, 1995. Exhibits to the Merger
Agreement are not included but will be
provided upon request.
13.1 Southern Bank Group's 1994 Annual Report to
Shareholders, certain specified pages of which are
specifically incorporated by reference.
<PAGE> 7
EXHIBIT 2.1
AGREEMENT AND PLAN OF MERGER
OF
SOUTHTRUST OF GEORGIA, INC.
AND
SOUTHERN BANK GROUP, INC.
JOINED IN BY
SOUTHTRUST CORPORATION
A-1
<PAGE> 8
<TABLE>
<S> <C>
ARTICLE I
THE MERGER
Section 1.1 Consummation of Merger; Closing Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-6
------------------------------------
Section 1.2 Effect of Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-7
----------------
Section 1.3 Further Assurances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-7
------------------
Section 1.4 Directors and Officers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-7
----------------------
Section 1.5 Stockholder Approval . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-8
--------------------
ARTICLE II
CONVERSION OF CONSTITUENTS' CAPITAL SHARES
Section 2.1 Manner of Conversion of SBG Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-8
----------------------------------
Section 2.2 SBG Stock Options and Related Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-9
-------------------------------------
Section 2.3 Fractional Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-9
-----------------
Section 2.4 Effectuating Conversion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-10
-----------------------
Section 2.5 Laws of Escheat . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-11
---------------
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SBG
Section 3.1 Corporate Organization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-11
----------------------
Section 3.2 Capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-12
--------------
Section 3.3 Financial Statements; Filings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-12
-----------------------------
Section 3.4 Loan Portfolio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-13
--------------
Section 3.5 Certain Loans and Related Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-14
---------------------------------
Section 3.6 Authority; No Violation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-14
-----------------------
Section 3.7 Consents and Approvals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-14
----------------------
Section 3.8 Broker's Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-15
-------------
Section 3.9 Absence of Certain Changes or Events . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-15
------------------------------------
Section 3.10 Legal Proceedings; Etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-15
----------------------
Section 3.11 Taxes and Tax Returns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-15
---------------------
Section 3.12 Employee Benefit Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-16
----------------------
Section 3.13 Title and Related Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-16
-------------------------
Section 3.14 Real Estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-17
-----------
Section 3.15 Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-18
---------------------
Section 3.16 Commitments and Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-19
-------------------------
Section 3.17 Regulatory Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-19
------------------
Section 3.18 Registration Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-19
------------------------
Section 3.19 State Takeover Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-19
-------------------
Section 3.20 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-19
---------
Section 3.21 Labor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-19
-----
Section 3.22 Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-20
--------------------
Section 3.23 Transactions with Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-20
----------------------------
Section 3.24 Proxy Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-20
---------------
Section 3.25 Deposit Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-20
-----------------
Section 3.26 Untrue Statements and Omissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-20
-------------------------------
</TABLE>
A-2
<PAGE> 9
<TABLE>
<S> <C>
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF
SOUTHTRUST AND ST-SUB
Section 4.1 Organization and Related Matters of SouthTrust . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-21
----------------------------------------------
Section 4.2 Organization and Related Matters of ST-Sub . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-21
------------------------------------------
Section 4.3 Capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-21
--------------
Section 4.4 Authorization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-22
-------------
Section 4.5 Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-22
--------------------
Section 4.6 Absence of Certain Changes or Events . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-22
------------------------------------
Section 4.7 Legal Proceedings, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-23
-----------------------
Section 4.8 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-23
---------
Section 4.9 Consents and Approvals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-23
----------------------
Section 4.10 Accounting, Tax, Regulatory Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-23
-----------------------------------
Section 4.11 Proxy Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-23
---------------
Section 4.12 No Broker's or Finder's Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-23
----------------------------
Section 4.13 Untrue Statements and Omissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-23
-------------------------------
ARTICLE V
COVENANTS AND AGREEMENTS
Section 5.1 Conduct of the Business of SBG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-24
------------------------------
Section 5.2 Current Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-25
-------------------
Section 5.3 Access to Properties; Personnel and Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-25
-------------------------------------------
Section 5.4 Approval of SBG Shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-26
----------------------------
Section 5.5 No Other Bids . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-26
-------------
Section 5.6 Notice of Deadlines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-27
-------------------
Section 5.7 Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-27
----------
Section 5.8 Maintenance of Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-27
-------------------------
Section 5.9 Environmental Audits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-27
--------------------
Section 5.10 Title Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-27
---------------
Section 5.11 Surveys . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-27
-------
Section 5.12 Compliance Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-28
------------------
Section 5.13 Exemption Under Anti-Takeover Statutes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-28
--------------------------------------
Section 5.14 Subsidiary Merger Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-28
---------------------------
ARTICLE VI
ADDITIONAL COVENANTS AND AGREEMENTS
Section 6.1 Best Efforts; Cooperation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-28
-------------------------
Section 6.2 Regulatory Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-28
------------------
Section 6.3 Other Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-28
-------------
Section 6.4 Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-29
---------------
Section 6.5 Current Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-30
-------------------
Section 6.6 Registration Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-30
----------------------
Section 6.7 Reservation of Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-30
---------------------
Section 6.8 Consideration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-30
-------------
</TABLE>
A-3
<PAGE> 10
<TABLE>
<S> <C>
ARTICLE VII
MUTUAL CONDITIONS TO CLOSING
Section 7.1 Shareholder Approval . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-31
--------------------
Section 7.2 Regulatory Approvals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-31
--------------------
Section 7.3 Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-31
----------
Section 7.4 Proxy Statement and Registration Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-31
------------------------------------------
ARTICLE VIII
CONDITIONS TO THE OBLIGATIONS OF SOUTHTRUST AND ST-SUB
Section 8.1 Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-31
------------------------------
Section 8.2 Performance of Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-31
--------------------------
Section 8.4 Absence of Adverse Facts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-31
------------------------
Section 8.5 Opinion of Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-32
------------------
Section 8.6 Consents Under Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-32
-------------------------
Section 8.7 Material Condition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-32
------------------
Section 8.8 Matters Relating to Employment Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-32
-----------------------------------------
Section 8.10 Outstanding Shares of SBG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-32
-------------------------
Section 8.11 Dissenters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-32
----------
Section 8.12 Certification of Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-32
-----------------------
ARTICLE IX
CONDITIONS TO OBLIGATIONS OF SBG
Section 9.1 Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-33
------------------------------
Section 9.2 Performance of Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-33
--------------------------
Section 9.3 Certificate Representing Satisfaction of Conditions . . . . . . . . . . . . . . . . . . . . . . . . . . A-33
---------------------------------------------------
Section 9.4 Absence of Adverse Facts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-33
------------------------
Section 9.5 Consents Under Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-33
-------------------------
Section 9.6 Opinion of Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-33
------------------
Section 9.7 SouthTrust Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-33
-----------------
Section 9.8 Tax Opinion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-33
-----------
Section 9.9 Price of SouthTrust Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-33
--------------------------
Section 9.10 Fairness Opinion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-33
----------------
ARTICLE X
TERMINATION, WAIVER AND AMENDMENT
Section 10.1 Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-34
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Section 10.2 Effect of Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-34
---------------------
Section 10.3 Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-35
----------
Section 10.4 Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-35
-------
Section 10.5 Non-Survival of Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-35
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</TABLE>
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<PAGE> 11
<TABLE>
<S> <C>
ARTICLE XI
MISCELLANEOUS
Section 11.1 Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-35
----------------
Section 11.2 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-35
-------
Section 11.3 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-36
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Section 11.4 Costs and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-36
------------------
Section 11.5 Captions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-36
--------
Section 11.6 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-37
------------
Section 11.7 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-37
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Section 11.8 Persons Bound; No Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-37
----------------------------
Section 11.9 Exhibits and Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-37
----------------------
Section 11.10 Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-37
------
Section 11.11 Construction of Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-37
---------------------
</TABLE>
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<PAGE> 12
AGREEMENT AND PLAN OF MERGER
OF
SOUTHTRUST OF GEORGIA, INC.
AND
SOUTHERN BANK GROUP, INC.
JOINED IN BY
SOUTHTRUST CORPORATION
This AGREEMENT AND PLAN OF MERGER, dated as of the 17th day of
March, 1995 (this "Agreement"), by and between SouthTrust of Georgia, Inc., a
Georgia corporation ("ST-Sub"), and Southern Bank Group, Inc., a Georgia
corporation and a registered bank holding company ("SBG"), and joined in by
SouthTrust Corporation, a Delaware corporation ("SouthTrust").
WITNESSETH THAT:
WHEREAS, the respective Boards of Directors of ST-Sub and SBG
deem it in the best interests of ST-Sub and of SBG, respectively, and of their
respective shareholders, that ST-Sub and SBG merge pursuant to this Agreement
in a transaction that qualifies as a reorganization pursuant to Section 368(a)
of the Internal Revenue Code of 1986 (the "Code") (the "Merger");
WHEREAS, the Boards of Directors of ST-Sub and SBG have
approved this Agreement and have directed that this Agreement be submitted to
their respective shareholders for approval and adoption in accordance with the
laws of the State of Georgia and the United States;
WHEREAS, SouthTrust, the sole shareholder of ST-Sub, will
deliver, or cause to be delivered, to the shareholders of SBG the consideration
to be paid pursuant to the Merger in accordance with the terms of this
Agreement; and
WHEREAS, SBG owns all the issued and outstanding capital stock
of The Northside Bank & Trust Company, a Georgia banking corporation
("Northside Bank"), and ST-Sub owns all of the issued and outstanding capital
stock of SouthTrust Bank of Georgia, N.A., a national banking association
("ST-Bank"), and it is contemplated that, in connection with the consummation
of this Agreement and pursuant to the terms of a certain Subsidiary Merger
Agreement (the "Subsidiary Merger Agreement"), Northside Bank will be merged
with and into ST-Bank;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants, representations, warranties and agreements herein contained,
the parties agree that SBG will be merged with and into ST-Sub and that the
terms and conditions of the Merger, the mode of carrying the Merger into
effect, including the manner of converting the shares of common stock of SBG,
par value $1.00 per share, into shares of common stock of SouthTrust, par value
of $2.50 per share, shall be as hereinafter set forth.
ARTICLE I
THE MERGER
Section 1.1 Consummation of Merger; Closing Date. (a) Subject to
the provisions hereof, SBG shall be merged with and into ST-Sub (which has
heretofore and shall hereinafter be referred to as the "Merger") pursuant to
Sections 14-2-1101 et seq. of the Georgia Business Corporation Code, and ST-Sub
shall be the surviving corporation (sometimes hereinafter referred to as
"Surviving Corporation" when reference is made to it after the Effective Time
of the Merger (as defined below)). The Merger shall become effective on the
date and at the time on which the Articles of Merger have been duly filed with
the Secretary of State of Georgia, unless a later date is specified in such
Articles of Merger (such time is hereinafter referred to as the "Effective Time
of the Merger"). Subject to the terms and conditions hereof, unless otherwise
agreed upon by SouthTrust and SBG, the Effective Time of the Merger shall occur
within ten (10) business days following the later to occur of (i) the effective
date (including
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<PAGE> 13
expiration of any applicable waiting period) of the last required Consent (as
defined below) of any Regulatory Authority (as defined below) having authority
over the transactions contemplated under the Merger Agreement or the Subsidiary
Merger Agreement and (ii) the date on which the shareholders of SBG, to the
extent that their approval is required by applicable law, approve the
transactions contemplated by this Agreement. As used in this Agreement,
"Consent" shall mean a consent, approval or authorization, waiver, clearance,
exemption or similar affirmation by any person pursuant to any contract,
permit, law, regulation or order, and "Regulatory Authorities" shall mean,
collectively, the Federal Trade Commission (the "FTC"), the United States
Department of Justice (the "Justice Department"), the Board of Governors of the
Federal Reserve System (the "FRB"), the Office of Thrift Supervision (including
its predecessor, the Federal Home Loan Bank Board) (the "OTS"), the Office of
the Comptroller of the Currency (the "OCC"), the Federal Deposit Insurance
Corporation (the "FDIC"), the Georgia Department of Banking and Finance (the
"Georgia Department") and all other state regulatory agencies having
jurisdiction over the parties and their respective bank subsidiaries, the
National Association of Securities Dealers, Inc., all national securities
exchanges and the Securities and Exchange Commission (the "SEC").
(b) The closing of the Merger (the "Closing")
shall take place at the principal offices of SBG at 10:00 a.m. local time on
the day that the Effective Time of the Merger occurs, or such other date and
time and place as the parties hereto may agree (the "Closing Date"). Subject
to the provisions of this Agreement, at the Closing there shall be delivered to
each of the parties hereto the opinions, certificates and other documents and
instruments required to be so delivered pursuant to this Agreement.
(c) The home office of the Surviving Corporation
shall be located at _____________________________________________.
Section 1.2 Effect of Merger. (a) At the Effective Time of the
Merger, SBG shall be merged with and into ST-Sub and the separate existence of
SBG shall cease. The Articles of Incorporation and Bylaws of ST-Sub (copies of
which are set forth on Exhibit 1.2 hereto), as in effect on the date hereof and
as otherwise amended prior to the Effective Time of the Merger, shall be the
Articles of Incorporation and the Bylaws of the Surviving Corporation until
further amended as provided therein and in accordance with applicable law. The
Surviving Corporation shall have all the rights, privileges, immunities and
powers and shall be subject to all the duties and liabilities of a corporation
organized under the laws of the State of Georgia and shall thereupon and
thereafter possess all other privileges, immunities and franchises of a
private, as well as of a public nature, of each of the constituent
corporations. All property (real, personal and mixed) and all debts on
whatever account, including subscriptions to shares, and all choses in action,
all and every other interest, of or belonging to or due to each of the
constituent corporations so merged shall be taken and deemed to be transferred
to and vested in the Surviving Corporation without further act or deed. The
title to any real estate, or any interest therein, vested in any of the
constituent corporations shall not revert or be in any way impaired by reason
of the Merger. The Surviving Corporation shall thenceforth be responsible and
liable for all the liabilities and obligations of each of the constituent
corporations so merged and any claim existing or action or proceeding pending
by or against either of the constituent corporations may be prosecuted as if
the Merger had not taken place or the Surviving Corporation may be substituted
in its place. Neither the rights of creditors nor any liens upon the property
of any constituent corporation shall be impaired by the Merger.
(b) The shares of common stock, par value $____,
of ST-Sub issued and outstanding immediately prior to the Effective Time of the
Merger shall remain outstanding and unchanged after the Merger and shall
thereafter constitute all of the issued and outstanding shares of capital stock
of the Surviving Corporation.
Section 1.3 Further Assurances. From and after the Effective
Time of the Merger, as and when requested by the Surviving Corporation, the
officers and directors of SBG last in office shall execute and deliver or cause
to be executed and delivered in the name of SBG such deeds and other
instruments and take or cause to be taken such further or other actions as
shall be necessary in order to vest or perfect in or confirm of record or
otherwise to the Surviving Corporation title to and possession of all of the
property, interests, assets, rights, privileges, immunities, powers, franchises
and authority of SBG.
Section 1.4 Directors and Officers. From and after the Effective
Time of the Merger, the directors of the Surviving Corporation shall be those
persons theretofore serving as directors of ST-Sub and the officers of the
Surviving Corporation shall be those persons who are serving in such capacity
immediately prior to the Effective Time of the Merger, and such additional
persons, in each case, as SouthTrust, at or prior to the Effective Time of the
Merger, shall designate in writing.
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<PAGE> 14
Section 1.5 Stockholder Approval. This Agreement is subject to
the approval by the affirmative vote of the respective holders of at least a
majority of the outstanding capital stock of SBG and ST-Sub.
ARTICLE II
CONVERSION OF CONSTITUENTS' CAPITAL SHARES
Section 2.1 Manner of Conversion of SBG Shares. Subject to the
provisions hereof, as of the Effective Time of the Merger and by virtue of the
Merger and without any further action on the part of the holder of any shares
of common stock of SBG, par value $1.00 (the "SBG Shares"):
(a) All SBG Shares which are held by SBG as treasury stock, if
any, shall be canceled and retired and no consideration shall
be paid or delivered in exchange therefor.
(b) Subject to the terms and conditions of this Agreement,
including, without limitation, Section 2.3 hereof and except
with regard to Dissenting SBG Shares (as hereinafter defined),
each SBG Share outstanding immediately prior to the Effective
Time of the Merger shall be converted into the right to
receive 0.5275665 shares of common stock of SouthTrust (and
the rights associated therewith issued pursuant to a Rights
Agreement dated February 22, 1989 between SouthTrust and
Mellon Bank, N.A.) (together, the "SouthTrust Shares") (such
fraction, as may be adjusted, as provided herein, being
hereinafter referred to as the "Conversion Ratio"). The
Conversion Ratio, including the number of SouthTrust Shares
issuable in the Merger, shall be subject to an appropriate
adjustment in the event of any stock split, reverse stock
split, dividend payable in SouthTrust Shares, reclassification
or similar distribution whereby SouthTrust issues SouthTrust
Shares or any securities convertible into or exchangeable for
SouthTrust Shares without receiving any consideration in
exchange therefor, provided that the record date of such
transaction is a date after the date of this Agreement and
prior to the Effective Time of the Merger. The Conversion
Ratio also is subject to an adjustment, in the sole discretion
of SouthTrust, upon the occurrence of certain conditions
specified in Section 9.9 hereof.
(c) Each outstanding SBG Share, the holder of which has demanded
and perfected his demand for payment of the "fair" value of
such share in accordance with Sections 14-2-1301 et seq. of
the Georgia Business Corporation Code (the "Dissent
Provisions"), to the extent applicable, and has not
effectively withdrawn or lost his right to such appraisal (the
"Dissenting SBG Shares"), shall not be converted into or
represent a right to receive the SouthTrust Shares issuable in
the Merger but the holder thereof shall be entitled only to
such rights as are granted by the Dissent Provisions. SBG
shall give SouthTrust prompt notice upon receipt by SBG of any
written objection to the Merger and any written demands for
payment of the fair value of SBG Shares, and of withdrawals of
such demands, and any other instruments provided to SBG
pursuant to the Dissent Provisions (any shareholder duly
making such demand being hereinafter called a "Dissenting
Shareholder"). Each Dissenting Shareholder who becomes
entitled, pursuant to the Dissent Provisions, to payment of
fair value for any SBG Shares held by such Dissenting
Shareholder shall receive payment therefor from the Surviving
Corporation (but only after the amount thereof shall have been
agreed upon or at the times and in the amounts required by the
Dissent Provisions) and all of such Dissenting Shareholder's
SBG Shares shall be canceled. Neither SBG nor the Surviving
Corporation shall, except with the prior written consent of
SouthTrust, voluntarily make any payment with respect to, or
settle or offer to
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<PAGE> 15
settle, any demand for payment by any Dissenting Shareholder.
If any Dissenting Shareholder shall have failed to perfect or
shall have effectively withdrawn or lost such right to demand
payment of fair value, the SBG Shares held by such Dissenting
Shareholder shall thereupon be deemed to have been converted
into the right to receive the consideration to be issued in
the Merger as provided by this Agreement.
Section 2.2 SBG Stock Options and Related Matters. (a) As of
the Effective Time of the Merger, all rights with respect to the SBG Shares
issuable pursuant to the exercise of stock options ("SBG Options") granted by
SBG under stock option plans of SBG (the "SBG Stock Option Plans"), which are
outstanding at the Effective Time of the Merger, whether or not such SBG
Options are then exercisable, shall, subject to this section, be assumed by
SouthTrust in accordance with the terms of the particular SBG Stock Option Plan
under which such SBG Options were issued and the stock option agreement by
which such SBG Options are evidenced. From and after the Effective Time of the
Merger, (i) each SBG Option assumed by SouthTrust hereunder may be exercised
solely for SouthTrust Shares, (ii) the number of SouthTrust Shares subject to
such SBG Option shall be equal to the number of SBG Shares subject to such SBG
Option immediately prior to the Effective Time of the Merger multiplied by the
Conversion Ratio and (iii) the per share exercise price under each such SBG
Option shall be adjusted by dividing the per share exercise price under each
such SBG Option by the Conversion Ratio and rounding down to the nearest cent.
(b) At all times after the Effective Time of the Merger,
SouthTrust shall reserve for issuance such number of SouthTrust Shares as shall
be necessary to permit the exercise of the SBG Options in the manner
contemplated by this Agreement. At or prior to, or at the election of
SouthTrust within a reasonable time (not to exceed 30 days) after, the
Effective Time of the Merger, SouthTrust shall file a Registration Statement on
Form S-3 or Form S-8, as the case may be (or any successor or other appropriate
form), with respect to the SouthTrust Shares subject to the SBG Options and
shall use its best efforts to maintain the effectiveness of such registration
statement or registration statements (and maintain the current status of the
prospectus or prospectuses contained therein) for so long as any of the SBG
Options remain outstanding. SouthTrust shall make any filings required under
any applicable state securities laws to qualify the SouthTrust Shares subject
to such SBG Options for resale thereunder.
(c) The number of SouthTrust Shares subject to the SBG
Options to be assumed by SouthTrust hereunder and the exercise price thereof
shall, from and after the Effective Time of the Merger, be subject to
appropriate adjustment in the event of the occurrence of any transaction
described in Section 2.1(b) hereof if the record date with respect to such
transaction is on or after the Effective Time of the Merger.
(d) It is intended that the foregoing assumption of SBG
Options shall be undertaken in a manner that will not constitute a
"modification" as defined in Section 424 of the Code as to any stock option
which is an incentive stock option as defined in Section 422 of the Code. All
restrictions or limitations on transfer with respect to SBG Shares awarded
under a SBG Stock Option Plan ("Restricted Stock"), to the extent that such
restrictions or limitations shall not have already lapsed, shall remain in full
force and effect with respect to the SouthTrust Shares into which such
Restricted Stock is converted pursuant to this Agreement, unless such
restrictions arise under the Securities Act of 1933 and are eliminated by
virtue of the Registration Statement described in Section 6.6, below. Except
as otherwise provided herein, (i) the provisions of the SBG Stock Option Plans
that provide for the issuance or grant of any other interest in respect of the
capital stock of SBG shall be deleted as of the Effective Time of the Merger
and (ii) SBG shall take all reasonable steps to ensure that following the
Effective Time of the Merger no holder of SBG Options shall have any right
thereunder to acquire any equity securities of SBG.
(e) SBG acknowledges that the holders of SBG Options who
may become or be deemed to be executive officers or directors of SouthTrust
after the Effective Time of the Merger may be subject to the short-swing sale
restrictions of the Securities Exchange Act of 1934 and regulations promulgated
thereunder.
(f) At the election of SouthTrust, SBG shall use its best
efforts to procure from each holder of SBG Options, and shall deliver to
SouthTrust at the Closing, an executed acknowledgement of the treatment and
disposition of such holder's SBG Options, as provided for under Section 2.2 of
this Agreement.
Section 2.3 Fractional Shares. Notwithstanding any other
provision of this Agreement, each holder of SBG Shares converted pursuant to
the Merger, and each holder of SBG Options assumed by SouthTrust pursuant to
this Agreement, who would otherwise have been entitled to receive a fraction of
a SouthTrust Share (after taking into account all certificates delivered by
such holder), shall receive, in lieu thereof, cash (without interest) in an
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<PAGE> 16
amount equal to such fractional part of such SouthTrust Share, multiplied by
the market value of one SouthTrust Share at the Effective Time of the Merger in
the case of shares exchanged pursuant to the Merger or at the date of exercise
in the case of SBG Options to be exercised for SouthTrust Shares. The market
value of one SouthTrust Share at the Effective Time of the Merger or the date
of exercise, as the case may be, shall be the last sale price of such
SouthTrust Shares, as reported by The Nasdaq Stock Market-National Market
("Nasdaq") on the last business day preceding the Effective Time of the Merger
or the date of exercise, as the case may be, or, if the SouthTrust Shares
hereafter become listed for trading on any national securities exchange
registered under the Securities Exchange Act of 1934, the last sale price of
such SouthTrust Shares on the applicable date as reported on the principal
securities exchange on which the SouthTrust Shares are then listed for trading.
No such holder will be entitled to dividends, voting rights or any other rights
as a shareholder in respect of any fractional share.
Section 2.4 Effectuating Conversion (a) The Trust and Financial
Services Division of SouthTrust Bank of Alabama, National Association, or such
other institution as SouthTrust and SouthTrust Bank of Alabama, National
Association, may designate, shall serve as the exchange agent (the "Exchange
Agent"). The Exchange Agent may employ sub-agents in connection with
performing its duties. As of the Effective Time of the Merger, SouthTrust will
deliver or cause to be delivered to the Exchange Agent the consideration to be
paid by SouthTrust for the SBG Shares, along with the appropriate cash payment
in lieu of fractional interests in SouthTrust Shares. As promptly as
practicable after the Effective Time of the Merger, the Exchange Agent shall
send or cause to be sent to each former holder of record of SBG Shares
transmittal materials (the "Letter of Transmittal") for use in exchanging their
certificates formerly representing SBG Shares for the consideration provided
for in this Agreement. The Letter of Transmittal will contain instructions
with respect to the surrender of certificates representing SBG Shares and the
receipt of the consideration contemplated by this Agreement and will require
each holder of SBG Shares to transfer good and marketable title to such SBG
Shares to SouthTrust, free and clear of all liens, claims and encumbrances.
Amounts that would have been payable to Dissenting Shareholders for SBG Shares
but for the fact of their dissent in accordance with the provisions of Section
2.1(c) hereof shall be returned by the Exchange Agent to SouthTrust as promptly
as is practicable.
(b) At the Effective Time of the Merger, the stock
transfer books of SBG shall be closed as to holders of SBG Shares immediately
prior to the Effective Time of the Merger and no transfer of SBG Shares by any
such holder shall thereafter be made or recognized and each outstanding
certificate formerly representing SBG Shares shall, without any action on the
part of any holder thereof, no longer represent SBG Shares. If, after the
Effective Time of the Merger, certificates are properly presented to the
Exchange Agent, such certificates shall be exchanged for the consideration
contemplated by this Agreement into which the SBG Shares represented thereby
were converted in the Merger.
(c) In the event that any holder of SBG Shares is unable
to deliver the certificate which represents such holder's SBG Shares,
SouthTrust, in the absence of actual notice that any SBG Shares theretofore
represented by any such certificate have been acquired by a bona fide
purchaser, shall deliver to such holder the consideration contemplated by this
Agreement and the amount of cash representing fractional SouthTrust Shares to
which such holder is entitled in accordance with the provisions of this
Agreement upon the presentation of all of the following:
(i) An affidavit or other evidence to the reasonable
satisfaction of SouthTrust that any such certificate
has been lost, wrongfully taken or destroyed;
(ii) Such security or indemnity as may be reasonably
requested by SouthTrust to indemnify and hold
SouthTrust harmless; and
(iii) Evidence to the satisfaction of SouthTrust that such
holder is the owner of the SBG Shares theretofore
represented by each certificate claimed by such
holder to be lost, wrongfully taken or destroyed and
that such holder is the person who would be entitled
to present each such certificate for exchange
pursuant to this Agreement.
(d) In the event that the delivery of the consideration
contemplated by this Agreement and the amount of cash representing fractional
SouthTrust Shares are to be made to a person other than the person in
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<PAGE> 17
whose name any certificate representing SBG Shares surrendered is registered,
such certificate so surrendered shall be properly endorsed (or accompanied by
an appropriate instrument of transfer), with the signature(s) appropriately
guaranteed, and otherwise in proper form for transfer, and the person
requesting such delivery shall pay any transfer or other taxes required by
reason of the delivery to a person other than the registered holder of such
certificate surrendered or establish to the satisfaction of SouthTrust that
such tax has been paid or is not applicable.
(e) No holder of SBG Shares shall be entitled to receive
any dividends or distributions declared or made with respect to the SouthTrust
Shares with a record date before the Effective Time of the Merger. Neither the
consideration contemplated by this Agreement, any amount of cash representing
fractional SouthTrust Shares nor any dividend or other distribution with
respect to SouthTrust Shares where the record date thereof is on or after the
Effective Time of the Merger shall be paid to the holder of any unsurrendered
certificate or certificates representing SBG Shares, and SouthTrust shall not
be obligated to deliver any of the consideration contemplated by this
Agreement, any amount of cash representing fractional SouthTrust Shares or any
such dividend or other distribution with respect to SouthTrust Shares until
such holder shall surrender the certificate or certificates representing SBG
Shares as provided for by the Agreement. Subject to applicable laws, following
surrender of any such certificate or certificates, there shall be paid to the
holder of the certificate or certificates then representing SouthTrust Shares
issued in the Merger, without interest at the time of such surrender, the
consideration contemplated by this Agreement, the amount of any cash
representing fractional SouthTrust Shares and the amount of any dividends or
other distributions with respect to SouthTrust Shares to which such holder is
entitled as a holder of SouthTrust Shares and which are payable to holders of
record of SouthTrust Shares on or after the Effective Time of the Merger and
prior to the surrender and exchange of the certificates, but if the payment
date is subsequent to the surrender, payment of such distributions shall be
made on the applicable payment date.
Section 2.5 Laws of Escheat. If any of the consideration due or
other payments to be paid or delivered to the holders of SBG Shares is not paid
or delivered within the time period specified by any applicable laws concerning
abandoned property, escheat or similar laws, and if such failure to pay or
deliver such consideration occurs or arises out of the fact that such property
is not claimed by the proper owner thereof, SouthTrust or the Exchange Agent
shall be entitled to dispose of any such consideration or other payments in
accordance with applicable laws concerning abandoned property, escheat or
similar laws. Any other provision of this Agreement notwithstanding, none of
SBG, SouthTrust, ST-Sub, the Exchange Agent, nor any other person acting on
their behalf shall be liable to a holder of SBG Shares for any amount paid or
property delivered in good faith to a public official pursuant to and in
accordance with any applicable abandoned property, escheat or similar law.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SBG
SBG hereby represents and warrants to ST-Sub and SouthTrust as follows
as of the date hereof and as of all times up to and including the Effective
Time of the Merger (except as otherwise provided):
Section 3.1 Corporate Organization. (a) SBG is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Georgia. SBG has the corporate power and authority to own or lease
all of its properties and assets and to carry on its business as such business
is now being conducted, and SBG is duly licensed or qualified to do business in
Georgia and elsewhere where the nature of the business conducted by it or the
character or location of the properties and assets owned or leased by it make
such qualification necessary, except where the failure to be so licensed or
qualified would not have a material adverse effect on the business, assets,
operations, financial condition or results of operations of SBG (such business,
assets, operations, financial condition or results of operations hereinafter
collectively referred to as the "Condition of SBG") on a consolidated basis.
SBG is duly registered as a bank holding company under the Bank Holding Company
Act of 1956, as amended. True and correct copies of the Articles or
Certificate of Incorporation of SBG and the Bylaws of SBG, each as amended to
the date hereof, have been delivered to SouthTrust.
(b) Northside Bank is a Georgia banking corporation duly
organized, validly existing and in good standing under the laws of Georgia.
Northside Bank has the corporate power and authority to own or lease all of its
properties and assets and to carry on its business as such business is now
being conducted, and Northside Bank is duly licensed or qualified to do
business in each jurisdiction in which the nature of the business conducted
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<PAGE> 18
by it or the character or location of the properties and assets owned or leased
by it makes such licensing or qualification necessary, except where the failure
to be so licensed or qualified would not have a material adverse effect on the
Condition of the Bank. True and correct copies of the Articles of
Incorporation and the Bylaws of Northside Bank, as amended to the date hereof,
have been delivered to SouthTrust.
(c) Each of SBG, Northside Bank and their respective
subsidiaries has in effect all federal, state, local and foreign governmental,
regulatory and other authorizations, permits and licenses necessary for each of
them to own or lease its properties and assets and to carry on its business as
now conducted, the absence of which, either individually or in the aggregate,
would have a material adverse effect on the Condition of SBG on a consolidated
basis.
(d) Except for Northside Bank and Southern Mortgage
Group, Inc. (which is inactive as of the date hereof), SBG does not own any
capital stock of any subsidiary, and Northside Bank does not own any capital
stock of any subsidiary; SBG and Northside Bank do not have any interest in any
partnership or joint venture; for purposes of this Agreement, a "subsidiary"
means any corporation or other entity of which the party referred to
beneficially owns, controls, or has the power to vote, directly or indirectly,
more than 5% of the outstanding equity securities.
(e) The minute books of SBG, Northside Bank and their
respective subsidiaries contain complete and accurate records in all material
respects of all meetings and other corporate actions held or taken by their
respective shareholders and Boards of Directors (including all committees
thereof).
Section 3.2 Capitalization. (a) The authorized capital stock of
SBG consists of 10,000,000 shares of common stock, par value $1.00
(hereinbefore and hereinafter referred to as "SBG Shares"), 1,838,601 shares of
which as of the date hereof are issued and outstanding (none of which is held
in the treasury of SBG). All of the issued and outstanding SBG Shares have
been duly authorized and validly issued and all such shares are fully paid and
nonassessable. As of the date hereof, there are no outstanding options,
warrants, commitments, or other rights or instruments to purchase or acquire
any shares of capital stock of SBG, or any securities or rights convertible
into or exchangeable for shares of capital stock of SBG, except for options to
purchase 87,393 SBG Shares (which are described in more detail in Disclosure
Schedule 3.2).
(b) The authorized capital stock of Northside Bank
consists of 5,000,000 shares of common stock, par value $5.00 per share,
1,000,000 shares of which as of the date hereof are issued and outstanding
(none of which is held in the treasury of the Northside Bank) (the "Northside
Bank Shares"). All of the issued and outstanding Northside Bank Shares have
been duly authorized and validly issued and all such shares are fully paid and
nonassessable. As of the date hereof, there are no outstanding options,
warrants, commitments or other rights or instruments to purchase or acquire any
shares of capital stock of Northside Bank, or any securities or rights
convertible into or exchangeable for shares of capital stock of Northside Bank.
(c) All of the issued and outstanding shares of capital
stock of Northside Bank:
(i) are owned by SBG; and
(ii) are so owned free and clear of all liens and
encumbrances and adverse claims thereto.
Section 3.3 Financial Statements; Filings. (a) Northside Bank
has previously delivered to SouthTrust copies of the financial statements of
Northside Bank as of and for the years ended December 31, 1993, 1992 and 1991,
and the financial statements of Northside Bank as of and for the periods ended
March 31, 1994, June 30, 1994, and September 30, 1994, and Northside Bank shall
deliver to SouthTrust, as soon as practicable following the preparation of
additional financial statements for each subsequent calendar quarter (or other
reporting period) or year of Northside Bank, the financial statements of
Northside Bank as of and for such subsequent calendar quarter (or other
reporting period) or year (such financial statements, unless otherwise
indicated, being hereinafter referred to collectively as the "Financial
Statements of Northside Bank").
(b) Northside Bank has previously delivered to SouthTrust
copies of the Call Reports of Northside Bank as of and for the years ended
December 31, 1993, 1992 and 1991, and the Call Reports of Northside Bank as of
and for the periods ended March 31, 1994, June 31, 1994 and September 30, 1994,
and Northside Bank shall deliver to SouthTrust, as soon as practicable
following the preparation of additional Call Reports for each
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subsequent calendar quarter (or other reporting period) or year of Northside
Bank, the Call Reports of Northside Bank as of and for each such subsequent
calendar quarter (or other reporting period) or year (such Call Reports, unless
otherwise indicated, being hereinafter referred to collectively as the "Call
Reports of Northside Bank").
(c) SBG has previously delivered to SouthTrust copies of
the consolidated financial statements of SBG as of and for the years ended
December 31, 1993, 1992 and 1991, and the consolidated financial statements of
SBG as of and for the periods ended March 31, 1994, June 30, 1994, and
September 30, 1994, and SBG shall deliver to SouthTrust, as soon as practicable
following the preparation of additional consolidated financial statements for
each subsequent calendar quarter (or other reporting period) or year of SBG,
the consolidated financial statements of SBG as of and for such subsequent
calendar quarter (or other reporting period) or year (such financial
statements, unless otherwise indicated, being hereinafter referred to
collectively as the "Financial Statements of SBG").
(d) Each of the Financial Statements of SBG, each of the
Financial Statements of Northside Bank, and each of the Call Reports of
Northside Bank (including the related notes, where applicable) have been or
will be prepared in all material respects in accordance with generally accepted
accounting principles or regulatory accounting principles, whichever is
applicable, which principles have been or will be consistently applied during
the periods involved, except as otherwise noted therein, and the books and
records of SBG and Northside Bank have been, are being, and will be maintained
in all material respects in accordance with applicable legal and accounting
requirements and reflect only actual transactions. Each of the Financial
Statements of SBG, each of the Financial Statements of Northside Bank, and each
of the Call Reports of Northside Bank (including the related notes, where
applicable) fairly present or will fairly present the financial position of SBG
on a consolidated basis and the financial position of Northside Bank (as the
case may be) as of the respective dates thereof and fairly present or will
fairly present the results of operations of SBG on a consolidated basis and the
results of operations of Northside Bank (as the case may be) for the respective
periods therein set forth.
(e) To the extent not prohibited by law, SBG has
heretofore delivered or made available, or caused to be delivered or made
available, to SouthTrust all reports and filings made or required to be made by
SBG, Northside Bank or any of their respective subsidiaries with the Regulatory
Authorities, and will from time to time hereafter furnish, or cause Northside
Bank to furnish to SouthTrust, upon filing or furnishing the same to the
Regulatory Authorities, all such reports and filings made after the date hereof
with the Regulatory Authorities. As of the respective dates of such reports
and filings, all such reports and filings did not and shall not contain any
untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading.
(f) Since September 30, 1994, none of SBG, Northside Bank
or any of their respective subsidiaries has incurred any obligation or
liability (contingent or otherwise) that has or might reasonably be expected to
have, individually or in the aggregate, a material adverse effect on the
Condition of SBG on a consolidated basis, except obligations and liabilities
(i) which are accrued or reserved against in the Financial Statements of SBG,
the Financial Statements of Northside Bank or the Call Reports of Northside
Bank, or reflected in the notes thereto, or (ii) which were incurred after
September 30, 1994, in the ordinary course of business consistent with past
practices. Since September 30, 1994, neither SBG nor Northside Bank have
incurred or paid any obligation or liability which would be material to the
Condition of SBG on a consolidated basis, except as may have been incurred or
paid in the ordinary course of business, consistent with past practices.
Section 3.4 Loan Portfolio. Except as set forth in Disclosure
Schedule 3.4, (i) all evidences of indebtedness in original principal amount in
excess of $10,000 reflected as assets in the Financial Statements of SBG, the
Financial Statements of Northside Bank and the Call Reports of Northside Bank
as of and for the year ended December 31, 1993 and the periods ended March 31,
1994, June 30, 1994 and September 30, 1994 were as of such dates in all
respects to the knowledge of SBG or Northside Bank the binding obligations of
the respective obligors named therein in accordance with their respective
terms, (ii) the allowances for possible loan losses shown on the Financial
Statements of SBG, the Financial Statements of Northside Bank and the Call
Reports of Northside Bank as of and for the year ended December 31, 1993 and
the periods ended March 31, 1994, June 30, 1994 and September 30, 1994 were,
and the allowance for possible loan losses to be shown on the Financial
Statements of SBG, the Financial Statements of Northside Bank and the Call
Reports of Northside Bank as of any date subsequent to the execution of this
Agreement will be, as of such dates, adequate to provide for possible losses,
net of recoveries relating to loans previously charged off, in respect of loans
outstanding (including accrued interest receivable) of SBG and Northside Bank
and other extensions of credit (including letters of credit or commitments to
make loans
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or extend credit), and (iii) each such allowance described in (ii) above has
been established in accordance with the accounting principles described in
Section 3.3(d).
Section 3.5 Certain Loans and Related Matters. Except as set
forth in Disclosure Schedule 3.5, none of SBG, Northside Bank or any of their
respective subsidiaries are, as of the date hereof, parties to any written or
oral: (i) loan agreement, note or borrowing arrangement, other than credit card
loans and other loans the unpaid balance of which does not exceed $10,000 per
loan, under the terms of which the obligor is sixty (60) days delinquent in
payment of principal or interest or, to the knowledge of SBG or Northside Bank,
in default of any other provision as of the date hereof; (ii) loan agreement,
note or borrowing arrangement which has been classified or, in the exercise of
reasonable diligence by SBG, Northside Bank, their respective subsidiaries or
any Regulatory Authority, should have been classified as "substandard,"
"doubtful," "loss," "other loans especially mentioned", "other assets
especially mentioned" or any comparable classifications by such persons; (iii)
loan agreement, note or borrowing arrangement, including any loan guaranty,
with any director or executive officer of SBG, Northside Bank or any of their
respective subsidiaries or any ten percent (10%) shareholder of SBG, or any
person, corporation or enterprise controlling, controlled by or under common
control with any of the foregoing; or (iv) loan agreement, note or borrowing
arrangement in violation of any law, regulation or rule applicable to SBG,
Northside Bank or any of their respective subsidiaries including, but not
limited to, those promulgated, interpreted or enforced by any of the Regulatory
Authorities and which violation could have a material adverse effect on the
Condition of SBG on a consolidated basis. As of the date of any Financial
Statement of SBG, any Financial Statement of Northside Bank and any Call Report
of Northside Bank subsequent to the execution of this Agreement, including the
date of the Financial Statements of SBG, the Financial Statements of Northside
Bank, and the Call Reports of Northside Bank that immediately precede the
Effective Time of the Merger, there shall not have been any material increase
in the loan agreements, notes or borrowing arrangements described in (i)
through (iv) above and Disclosure Schedule 3.5.
Section 3.6 Authority; No Violation. (a) SBG has full corporate
power and authority to execute and deliver this Agreement and, subject to the
approval of the shareholders of SBG and to the receipt of the Consents of the
Regulatory Authorities, to consummate the transactions contemplated hereby.
The Board of Directors of SBG has duly and validly approved this Agreement and
the transactions contemplated hereby, has authorized the execution and delivery
of this Agreement, has directed that this Agreement and the transactions
contemplated hereby be submitted to SBG's shareholders for approval at a
meeting of such shareholders and, except for the adoption of such Agreement by
its shareholders and receipt of the fairness opinion described in Section 9.10,
no other corporate proceedings on the part of SBG are necessary to consummate
the transactions so contemplated. This Agreement, when duly and validly
executed by SBG and delivered by SBG, will constitute a valid and binding
obligation of SBG, and will be enforceable against SBG in accordance with its
terms, except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the
enforcement of creditors rights generally and except that the availability of
the equitable remedy of specific performance or injunctive relief is subject to
the discretion of the court before which any proceeding may be brought.
(b) Neither the execution and delivery of this Agreement
by SBG nor the consummation by SBG of the transactions contemplated hereby, nor
compliance by SBG with any of the terms or provisions hereof, will (i) violate
any provision of the Articles of Incorporation or Bylaws of SBG or the Articles
of Incorporation or Bylaws of Northside Bank, (ii) to SBG's knowledge assuming
that the Consents of the Regulatory Authorities and approvals referred to
herein are duly obtained, violate any statute, code, ordinance, rule,
regulation, judgment, order, writ, decree or injunction applicable to SBG,
Northside Bank or any of their respective subsidiaries or any of their
respective properties or assets, or (iii) violate, conflict with, result in a
breach of any provisions of, constitute a default (or an event which, with
notice or lapse of time, or both, would constitute a default) under, result in
the termination of, accelerate the performance required by or result in the
creation of any lien, security interest, charge or other encumbrance upon any
of the respective properties or assets of SBG, Northside Bank or any of their
respective subsidiaries under, any of the terms, conditions or provisions of
any material note, bond, mortgage, indenture, deed of trust, license, permit,
lease, agreement or other instrument or obligation to which SBG, Northside Bank
or any of their respective subsidiaries is a party, or by which any of them or
any of their respective properties or assets may be bound or affected.
Section 3.7 Consents and Approvals. Except for (i) the filing by
SouthTrust with the SEC of a registration statement on Form S-4 (the
"Registration Statement") and the review and clearance thereof by the SEC which
Registration Statement shall include the proxy statement of SBG relating to the
meeting of the shareholders
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<PAGE> 21
of SBG at which the Merger is to be considered (the "Proxy Statement"); (ii)
the Consents of the Georgia Department, the FRB and, in the case of the
Subsidiary Merger Agreement, the OCC; (iii) approval of this Agreement by the
shareholders of ST-Sub and SBG; (iv) filing of Articles of Merger with the
State of Georgia; and (v) as set forth in Disclosure Schedule 3.7, no Consents
of any person are necessary in connection with the execution and delivery by
SBG of this Agreement, and the consummation by SBG of the Merger and the other
transactions contemplated hereby.
Section 3.8 Broker's Fees. None of SBG, Northside Bank or any of
their respective subsidiaries, nor any of their respective officers or
directors, has employed any broker or finder or incurred any liability for any
broker's fees, commissions or finder's fees in connection with any of the
transactions contemplated by this Agreement.
Section 3.9 Absence of Certain Changes or Events. Since December
31, 1993, there has not been (i) any declaration, payment or setting aside of
any dividend or distribution (whether in cash, stock or property) in respect of
the SBG Shares or (ii) any change or any event involving a prospective change
in the Condition of SBG on a consolidated basis which has had, or is reasonably
likely to have, a material adverse effect on the Condition of SBG on a
consolidated basis or on SBG, Northside Bank or any of their respective
subsidiaries generally, including, without limitation any change in the
administration or supervisory standing or rating of SBG, Northside Bank or any
of their respective subsidiaries with any Regulatory Authority, and no fact or
condition exists as of the date hereof which might reasonably be expected to
cause any such event or change in the future.
Section 3.10 Legal Proceedings; Etc. Except as set forth in
Disclosure Schedule 3.10, none of SBG, Northside Bank or any of their
respective subsidiaries is a party to any, and there are no pending or, to the
knowledge of SBG, Northside Bank and their respective subsidiaries, threatened,
judicial, administrative, arbitral or other proceedings, claims, actions,
causes of action or governmental investigations against SBG, Northside Bank or
any of their respective subsidiaries challenging the validity of the
transactions contemplated by this Agreement and, to the knowledge of SBG,
Northside Bank and their respective subsidiaries as of the date hereof, there
is no material proceeding, claim, action or governmental investigation against
SBG, Northside Bank or any of their respective subsidiaries; no judgment,
decree, injunction, rule or order of any court, governmental department,
commission, agency, instrumentality or arbitrator is outstanding against SBG,
Northside Bank or any of their respective subsidiaries which has a material
adverse effect on the Condition of SBG on a consolidated basis; there is no
default by SBG, Northside Bank or any of their respective subsidiaries under
any material contract or agreement to which SBG, Northside Bank or any of their
respective subsidiaries is a party; and none of SBG, Northside Bank or any of
their respective subsidiaries is a party to any agreement, order or memorandum
in writing by or with any Regulatory Authority restricting the operations of
SBG, Northside Bank or any of their respective subsidiaries and none of SBG,
Northside Bank or any of their respective subsidiaries has been advised by any
Regulatory Authority that any such Regulatory Authority is contemplating
issuing or requesting the issuance of any such order or memorandum in the
future.
Section 3.11 Taxes and Tax Returns. (a) SBG has previously
delivered or made available to SouthTrust copies of the federal income tax
returns of SBG and, if consolidated returns do not exist for all periods, of
Northside Bank and each of their respective subsidiaries, for the years
December 31, 1993, 1992 and 1991, and all schedules and exhibits thereto, and
will provide SouthTrust with a copy of its federal income tax return for the
year 1994 with all schedules and exhibits thereto, when such return is filed,
and, to the knowledge of SBG, Northside Bank and their respective subsidiaries,
such returns have not been examined by the Internal Revenue Service. Except as
reflected in Disclosure Schedule 3.11, SBG, Northside Bank and their respective
subsidiaries have duly filed in correct form all federal, state and local
information returns and tax returns required to be filed by either of them on
or prior to the date hereof, and SBG, Northside Bank and their respective
subsidiaries have duly paid or made adequate provisions for the payment of all
taxes and other governmental charges which have been incurred or are due or
claimed to be due from either of them by any federal, state or local taxing
authorities (including, without limitation, those due in respect of the
properties, income, business, capital stock, deposits, franchises, licenses,
sales and payrolls of SBG, Northside Bank and their respective subsidiaries)
other than taxes and other charges which (i)(A) are not yet delinquent or (B)
are being contested in good faith or (ii) have not been finally determined.
The amounts set forth as liabilities for taxes on the Financial Statements of
SBG, the Financial Statements of Northside Bank and the Call Reports of
Northside Bank are sufficient, in the aggregate, for the payment of all unpaid
federal, state and local taxes (including any interest or penalties thereon),
whether or not disputed, accrued or applicable, for the periods then ended, and
have been computed in accordance with generally accepted accounting principles.
Neither SBG
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nor any of its subsidiaries is responsible for the taxes of any other person
other than SBG and its subsidiaries, under treasury Regulation 1.1502- 6 or any
similar provision of federal, state or foreign law.
(b) (i) Proper and accurate amounts have been withheld by
SBG, Northside Bank and their respective subsidiaries from their employees and
others for all prior periods in compliance in all material respects with the
tax withholding provisions of all applicable federal, state and local laws and
regulations, and proper due diligence steps have been taken in connection with
back-up withholding, (ii) federal, state and local returns have been filed by
SBG, Northside Bank and their respective subsidiaries for all periods for which
returns were due with respect to income tax withholding, Social Security and
unemployment taxes and (iii) the amounts shown on such returns to be due and
payable have been paid in full or adequate provision therefor has been included
by either SBG or Northside Bank in the Financial Statements of SBG or the
Financial Statements of Northside Bank, as the case may be.
Section 3.12 Employee Benefit Plans. (a) None of SBG, Northside
Bank or any of their respective subsidiaries has or maintains any "employee
benefit plan," as defined in Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), except as described in Disclosure
Schedule 3.12(a).
(b) None of SBG, Northside Bank or any of their
respective subsidiaries (or any pension plan maintained by either of them) has
incurred any liability to the Pension Benefit Guaranty Corporation ("PBGC") or
the Internal Revenue Service with respect to any pension plan qualified under
Section 401 of the Code, except liabilities to the PBGC pursuant to Section
4007 of ERISA, all which have been fully paid. No reportable event under
Section 4043(b) of ERISA (including events waived by PBGC regulation) has
occurred with respect to any such pension plan.
(c) None of SBG, Northside Bank or any of their
respective subsidiaries has incurred any material liability under Section 4201
of ERISA for a complete or partial withdrawal from, or agreed to participate
in, any multi-employer plan as such term is defined in Section 3(37) of ERISA.
(d) All "employee benefit plans," as defined in Section
3(3) of ERISA, that are maintained by SBG, Northside Bank and their respective
subsidiaries comply, in all material respects with ERISA. None of SBG,
Northside Bank or any of their respective subsidiaries has any material
liability under any such plan that is not reflected in the Financial Statements
of SBG or the Call Reports of Northside Bank.
(e) No prohibited transaction (which shall mean any
transaction prohibited by Section 406 of ERISA and not exempt under Section 408
of ERISA) has occurred with respect to any employee benefit plan maintained by
SBG, Northside Bank or any of their respective subsidiaries (i) which would
result in the imposition, directly or indirectly, of a material excise tax
under Section 4975 of the Code or a material civil penalty under Section 502(i)
of ERISA, or (ii) the correction of which would have a material adverse effect
on the Condition of SBG, Northside Bank or any of their respective
subsidiaries; and, to the best knowledge of SBG, Northside Bank and their
respective subsidiaries no actions have occurred which could result in the
imposition of a penalty under any section or provision of ERISA.
(f) No employee benefit plan which is a defined benefit
pension plan has any "unfunded current liability," as that term is defined in
Section 302(d)(8)(A) of ERISA, and the present fair market value of the assets
of any such plan exceeds the plan's "benefit liabilities," as that term is
defined in Section 4001(a)(16) of ERISA, when determined under actuarial
factors that would apply if the plan terminated in accordance with all
applicable legal requirements.
(g) Except as described in Disclosure Schedule 3.12(g),
neither the execution and delivery of this Agreement nor the consummation of
the transactions contemplated hereby will (i) result in any material payment
(including, without limitation, severance, unemployment compensation, golden
parachute or otherwise) becoming due to any director or any officer or employee
of SBG, Northside Bank or any of their respective subsidiaries under any
benefit plan or otherwise, (ii) materially increase any benefits otherwise
payable under any benefit plan or (iii) result in any acceleration of the time
of payment or vesting of any such benefits to any material extent.
Section 3.13 Title and Related Matters. (a) Except as set forth
in Disclosure Schedule 3.13(a), SBG, Northside Bank and their respective
subsidiaries have good title, and as to owned real property, have good and
marketable title in fee simple absolute, to all assets and properties, real or
personal, tangible or intangible, reflected
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as owned by or leased or subleased by or carried under the name of either of
them on the Financial Statements of SBG, the Financial Statements of Northside
Bank, or the Call Reports of Northside Bank or acquired subsequent thereto
(except to the extent that such assets and properties have been disposed of for
fair value in the ordinary course of business since December 31, 1993), free
and clear of all liens, encumbrances, mortgages, security interests,
restrictions, pledges or claims, except for (i) those liens, encumbrances,
mortgages, security interests, restrictions, pledges or claims reflected in the
Financial Statements of SBG, the Financial Statements of Northside Bank, and
the Call Reports of Northside Bank or incurred in the ordinary course of
business after December 31, 1993, (ii) statutory liens for amounts not yet
delinquent or which are being contested in good faith, and (iii) liens,
encumbrances, mortgages, security interests, pledges, claims and title
imperfections that are not in the aggregate material to the Condition of SBG on
a consolidated basis.
(b) All agreements pursuant to which SBG, Northside Bank
or any of their respective subsidiaries leases, subleases or licenses material
real or material personal properties from others are valid, binding and
enforceable in accordance with their respective terms, and there is not, under
any of such leases or licenses, any existing default or event of default, or
any event which with notice or lapse of time, or both, would constitute a
default or force majeure, or provide the basis for any other claim of excusable
delay or nonperformance, except for defaults which individually or in the
aggregate would not have a material adverse effect on the Condition of SBG on a
consolidated basis.
(c) Other than real estate owned, acquired by foreclosure
or voluntary deed in lieu of foreclosure (i) all of the buildings, structures
and fixtures owned, leased or subleased by SBG, Northside Bank and their
respective subsidiaries are in good operating condition and repair, subject
only to ordinary wear and tear and/or minor defects which do not interfere with
the continued use thereof in the conduct of normal operations, and (ii) all of
the material personal properties owned, leased or subleased by SBG, Northside
Bank and their respective subsidiaries are in good operating condition and
repair, subject only to ordinary wear and tear and/or minor defects which do
not interfere with the continued use thereof in the conduct of normal
operations.
Section 3.14 Real Estate. (a) Disclosure Schedule 3.14(a)
identifies and sets forth a complete legal description for each parcel of real
estate or interest therein owned, leased or subleased by SBG, Northside Bank or
any of their respective subsidiaries or in which SBG, Northside Bank or any of
their respective subsidiaries has any ownership or leasehold interest.
(b) Disclosure Schedule 3.14(b) lists or otherwise
describes each and every written or oral lease or sublease under which SBG,
Northside Bank or any of their respective subsidiaries is the lessee of any
real property and which relates in any manner to the operation of the
businesses of SBG, Northside Bank or any of their respective subsidiaries.
All rentals due under such leases have been paid and there exists no material
default under the terms of any lease and no event has occurred which, upon the
passage of time or giving of notice, or both, would result in any event of
default or prevent SBG, Northside Bank or any of their respective subsidiaries,
as appropriate, from exercising and obtaining the benefits of any options or
other rights contained therein, except for defaults which individually or in
the aggregate would not have a material adverse effect on the Condition of SBG
on a consolidated basis. Except as set forth in Disclosure Schedule 3.14(b),
SBG, Northside Bank and their respective subsidiaries have all right, title
and interest as a lessee under the terms of each lease or sublease, free and
clear of all liens, claims or encumbrances (other than the rights of the
lessor), and all such leases are valid and in full force and effect. SBG,
Northside Bank and their respective subsidiaries have the right under each
such lease and sublease to occupy, use, possess, and control all property
leased or subleased by SBG, Northside Bank and their respective subsidiaries
and, as of the Effective Time of the Merger, shall have the right to transfer
each lease or sublease pursuant to this Agreement.
(c) To the knowledge of SBG or Northside Bank, none of
SBG, Northside Bank or any of their respective subsidiaries has violated, or is
currently in violation of, any law, regulation or ordinance relating to the
ownership or use of the real estate and real estate interests described in
Disclosure Schedules 3.14(a) and 3.14(b) including, but not limited to any law,
regulation or ordinance relating to zoning, building, occupancy, environmental
or comparable matter which individually or in the aggregate would have a
material adverse effect on the Condition of SBG on a consolidated basis.
(d) Except as described in Disclosure Schedule 3.14(d),
as to each parcel of real property owned or used by SBG, Northside Bank or any
of their respective subsidiaries, none of SBG, Northside Bank or
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any of their respective subsidiaries has received notice of any pending or, to
the knowledge of SBG, Northside Bank and their respective subsidiaries
threatened condemnation proceedings, litigation proceedings or mechanics or
materialmen's liens.
Section 3.15 Environmental Matters.
(a) Each of SBG, Northside Bank, their respective
subsidiaries, the Participation Facilities (as defined below), and the Loan
Properties (as defined below) are, and have been, in compliance with all
applicable laws, rules, regulations, standards and requirements of the United
States Environmental Protection Agency and all state and local agencies with
jurisdiction over pollution or protection of the environment, except for
violations which, individually or in the aggregate, will not have a material
adverse effect on the Condition of SBG on a consolidated basis.
(b) There is no litigation pending or, to the knowledge
of SBG, Northside Bank and their respective subsidiaries, threatened before any
court, governmental agency or board or other forum in which SBG, Northside Bank
or any of their respective subsidiaries or any Participation Facility has been
or, with respect to threatened litigation, may be, named as defendant (i) for
alleged noncompliance (including by any predecessor), with any Environmental
Law (as defined below) or (ii) relating to the release into the environment of
any Hazardous Material (as defined below) or oil, whether or not occurring or
on a site owned, leased or operated by SBG, Northside Bank or any of their
respective subsidiaries or any Participation Facility, except for such
litigation pending or threatened that will not, individually or in the
aggregate, have a material adverse effect on the Condition of SBG on a
consolidated basis.
(c) There is no litigation pending or, to the knowledge
of SBG, Northside Bank and their respective subsidiaries, threatened before any
court, governmental agency or board or other forum in which any Loan Property
(or SBG, Northside Bank or any of their respective subsidiaries in respect of
such Loan Property) has been or, with respect to threatened litigation, may be,
named as a defendant or potentially responsible party (i) for alleged
noncompliance (including by any predecessor) with any Environmental Law or (ii)
relating to the release into the environment of any Hazardous Material or oil,
whether or not occurring at, on or involving a Loan Property, except for such
litigation pending or threatened that will not individually or in the
aggregate, have a material adverse effect on the Condition of SBG on a
consolidated basis.
(d) To the knowledge of SBG, Northside Bank and their
respective subsidiaries, there is no reasonable basis for any litigation of a
type described in Sections 3.15(b) or 3.15(c) of this Agreement, except as will
not have, individually or in the aggregate, a material adverse effect on the
Condition of SBG on a consolidated basis.
(e) During the period of (i) ownership or operation by
SBG, Northside Bank or any of their respective subsidiaries of any of their
respective current properties, (ii) participation by SBG, Northside Bank or any
of their respective subsidiaries in the management of any Participation
Facility, or (iii) holding by SBG, Northside Bank or any of their respective
subsidiaries of a security interest in any Loan Property, there have been no
releases of Hazardous Material or oil in, on, under or affecting such
properties, except where such releases have not and will not, individually or
in the aggregate, have a material adverse effect on the Condition of SBG on a
consolidated basis.
(f) Prior to the period of (i) ownership or operation by
SBG, Northside Bank or any of their respective subsidiaries of any of their
respective current properties, (ii) participation by SBG, Northside Bank or any
of their respective subsidiaries in the management of any Participation
Facility, or (iii) holding by SBG, Northside Bank or any of their respective
subsidiaries of a security interest in any Loan Property, to the knowledge of
SBG, Northside Bank and their respective subsidiaries, there were no releases
of Hazardous Material or oil in, on, under or affecting any such property,
Participation Facility or Loan Property, except where such releases have not
and will not, individually or in the aggregate, have a material adverse effect
on the Condition of SBG on a consolidated basis.
(g) "Environmental Law" means any federal, state, local
or foreign law, statute, ordinance, rule, regulation, code, license, permit,
authorization, approval, consent, order, judgment, decree, injunction or
agreement with any regulatory agency relating to (i) the protection,
preservation or restoration of the environment (including, without limitation,
air, water vapor, surface water, groundwater, drinking water supply, surface
soil,
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subsurface soil, plant and animal life or any other natural resource), and/or
(ii) the use, storage, recycling, treatment, generation, transportation,
processing, handling, labeling, production, release or disposal of any
substance presently listed, defined, designated or classified as hazardous,
toxic, radioactive or dangerous, or otherwise regulated, whether by type or by
substance as a component; "Loan Property" means any property owned by SBG,
Northside Bank or any of their respective subsidiaries, or in which SBG,
Northside Bank or any of their respective subsidiaries holds a security
interest, and, where required by the context, includes the owner or operator of
such property, but only with respect to such property; "Hazardous Material"
means any pollutant, contaminant, or hazardous substance within the meaning of
the Comprehensive Environmental Response, Compensation, and Liability Act, 42
U.S.C. Section 9601 et seq., or any similar federal, state or local law; and
"Participation Facility" means any facility in which SBG, Northside Bank or any
of their respective subsidiaries participate in the management and, where
required by the context, includes the owner or operator of such facility, but
only with respect to such facility.
Section 3.16 Commitments and Contracts. Except as set forth in
Disclosure Schedule 3.16, none of SBG, Northside Bank or any of their
respective subsidiaries is a party or subject to any of the following (whether
written or oral, express or implied):
(a) Any employment contract or understanding (including
any understandings or obligations with respect to severance or termination pay
liabilities or fringe benefits) with any present or former officer, director,
employee, including in any such person's capacity as a consultant (other than
those which either are terminable at will without any further amount being
payable thereunder or as a result of such termination by SBG, Northside Bank or
any of their respective subsidiaries);
(b) Any labor contract or agreement with any labor union;
(c) Any contract covenants which limit the ability of
SBG, Northside Bank or any of their respective subsidiaries to compete in any
line of business or which involve any restriction of the geographical area in
which SBG, Northside Bank or any of their respective subsidiaries may carry on
its business (other than as may be required by law or applicable regulatory
authorities);
(d) Any lease (other than real estate leases described on
Disclosure Schedule 3.14(b)) or other agreements or contracts with annual
payments aggregating $5,000 or more; or
(e) Any other contract or agreement which would be
required to be disclosed in reports filed by SBG with the SEC or the FRB and
which has not been so disclosed.
Section 3.17 Regulatory Matters. None of SBG, Northside Bank or
any of their respective subsidiaries has agreed to take any action or has any
knowledge of any fact or has agreed to any circumstance that would materially
impede or delay receipt of any Consents of any Regulatory Authorities referred
to in this Agreement including, matters relating to the Community Reinvestment
Act and protests thereunder.
Section 3.18 Registration Obligations. None of SBG, Northside
Bank or any of their respective subsidiaries is under any obligation,
contingent or otherwise, which will survive the Merger to register any of its
securities under the Securities Act of 1933 or any state securities laws.
Section 3.19 State Takeover Laws. This Agreement and the
transactions contemplated hereby are not subject to or restricted by any
applicable state anti-takeover statute.
Section 3.20 Insurance. SBG and Northside Bank are presently
insured, and during each of the past three calendar years have been insured,
for reasonable amounts against such risks as companies or institutions engaged
in a similar business would, in accordance with good business practice,
customarily be insured. To the knowledge of SBG, Northside Bank and their
respective subsidiaries, the policies of fire, theft, liability and other
insurance maintained with respect to the assets or businesses of SBG, Northside
Bank and their respective subsidiaries provide adequate coverage against loss,
and the fidelity bonds in effect as to which SBG, Northside Bank or any of
their respective subsidiaries is named an insured are sufficient for their
purpose. Such policies of insurance are listed and described in Disclosure
Schedule 3.20.
Section 3.21 Labor. No work stoppage involving SBG, Northside
Bank or any of their respective subsidiaries is pending as of the date hereof
or, to the knowledge of SBG, Northside Bank and their respective subsidiaries,
threatened. None of SBG, Northside Bank or any of their respective
subsidiaries is involved in, or, to the knowledge of SBG, Northside Bank and
their respective subsidiaries, threatened with or affected by, any
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proceeding asserting that SBG, Northside Bank or any of their respective
subsidiaries has committed an unfair labor practice or any labor dispute,
arbitration, lawsuit or administrative proceeding which might reasonably be
expected to have a material adverse effect on the Condition of SBG on a
consolidated basis. No union represents or claims to represent any employees
of SBG, Northside Bank or any of their respective subsidiaries, and, to the
knowledge of SBG, Northside Bank and their respective subsidiaries, no labor
union is attempting to organize employees of SBG, Northside Bank or any of
their respective subsidiaries.
Section 3.22 Compliance with Laws. Each of SBG, Northside Bank
and their respective subsidiaries has conducted its business in accordance with
all applicable federal, foreign, state and local laws, regulations and orders,
and each is in compliance with such laws, regulations and orders, except for
such violations or non-compliance, which when taken together as a whole, will
not have a material adverse effect on the Condition of SBG on a consolidated
basis. Except as disclosed in Disclosure Schedule 3.22, none of SBG, Northside
Bank or any of their respective subsidiaries:
(a) To the knowledge of SBG and Northside Bank, is in
violation of any laws, orders or permits applicable
to its business or the employees or agents or
representatives conducting its business, except for
violations which individually or in the aggregate do
not have and will not have a material adverse effect
on the Condition of SBG on a consolidated basis; and
(b) Has received a notification or communication from any
agency or department of federal, state or local
government or the Regulatory Authorities or the staff
thereof (i) asserting that SBG, Northside Bank or any
of their respective subsidiaries is not in compliance
with any laws or orders which such governmental
authority or Regulatory Authority enforces, where
such noncompliance is not reasonably likely to have a
material adverse effect on the Condition of SBG on a
consolidated basis, (ii) threatening to revoke any
permit, the revocation of which is reasonably likely
to have a material adverse effect on the Condition of
SBG on a consolidated basis, (iii) requiring SBG,
Northside Bank or any of their respective
subsidiaries to enter into any cease and desist
order, formal agreement, commitment or memorandum of
understanding, or to adopt any resolutions or similar
undertakings, or (iv) directing, restricting or
limiting, or purporting to direct, restrict or limit
in any manner, the operations of SBG, Northside Bank
or any of their respective subsidiaries, including,
without limitation, any restrictions on the payment
of dividends.
Section 3.23 Transactions with Management. Except for (a)
deposits, all of which are on terms and conditions comparable to those made
available to other customers of Northside Bank at the time such deposits were
entered into, (b) the loans to directors or executive officers listed on
Disclosure Schedule 3.5, (c) the agreements listed on Disclosure Schedule 3.16,
and (d) the items described on Disclosure Schedule 3.23, there are no contracts
with or commitments to present or former stockholders, directors, officers or
employees involving the expenditure of more than $1,000 as to any one
individual, including, with respect to any business directly or indirectly
controlled by any such person, or $5,000 for all such contracts for commitments
in the aggregate for all such individuals.
Section 3.24 Proxy Materials. None of the information relating to
SBG, Northside Bank or any of their respective subsidiaries to be included in
the Proxy Statement which is to be mailed to the shareholders of SBG in
connection with the solicitation of their approval of this Agreement will, at
the time such Proxy Statement is mailed or at the time of the meeting of
shareholders to which such Proxy Statement (including as supplemented) relates,
be false or misleading with respect to any material fact, or omit to state any
material fact, necessary in order to make a statement therein not false or
misleading. The legal responsibility for the contents of such Proxy Statement
(other than information supplied by SouthTrust concerning SouthTrust or any of
its subsidiaries) shall be and remain with SBG, Northside Bank and their
respective subsidiaries.
Section 3.25 Deposit Insurance. The deposit accounts of Northside
Bank are insured by the Bank Insurance Fund in accordance with the provisions
of the Federal Deposit Insurance Act (the "Act"); Northside Bank has paid all
regular premiums and special assessments and filed all reports required under
the Act.
Section 3.26 Untrue Statements and Omissions. No representation
or warranty contained in Article III of this Agreement or in the Disclosure
Schedules of SBG contains any untrue statement of a material fact or omits
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to state a material fact necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF
SOUTHTRUST AND ST-SUB
SouthTrust and ST-Sub hereby represent and warrant to SBG as follows
as of the date hereof and also on the Effective Time of the Merger (except as
otherwise provided):
Section 4.1 Organization and Related Matters of SouthTrust. (a)
SouthTrust is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware. SouthTrust has the corporate
power and authority to own or lease all of its properties and assets and to
carry on its business as now conducted, or as proposed to be conducted pursuant
to this Agreement, and SouthTrust is licensed or qualified to do business in
each jurisdiction in which the nature of the business conducted by SouthTrust,
or the character or location of the properties and assets owned or leased by
SouthTrust makes such licensing or qualification necessary, except where the
failure to be so licensed or qualified would not have a material adverse effect
on the business, assets, operations, financial condition or results of
operations of SouthTrust on a consolidated basis (the "Condition of
SouthTrust"). SouthTrust is duly registered as a bank holding company under
the Bank Holding Company Act of 1956, as amended. True and correct copies of
the Restated Certificate of Incorporation of SouthTrust and the Bylaws of
SouthTrust, each as amended to the date hereof, have been made available to
SBG.
(b) SouthTrust has in effect all federal, state, local
and foreign governmental, regulatory and other authorizations, permits and
licenses necessary for it to own or lease its properties and assets and to
carry on its business as now conducted, the absence of which, either
individually or in the aggregate, would have a material adverse effect on the
Condition of SouthTrust on a consolidated basis.
(c) The minute books of SouthTrust contain complete and
accurate records in all material respects of all meetings and other corporate
actions held or taken by the shareholders and Boards of Directors of
SouthTrust.
Section 4.2 Organization and Related Matters of ST-Sub. (a)
ST-Sub is, or as of the Effective Time of the Merger will be a corporation duly
organized, validly existing and in good standing under the laws of the State of
Georgia. ST-Sub has, or will have, as of the Effective Time of the Merger, the
corporate power and authority to own or lease all of its properties and assets
and to carry on its business as now conducted, or as proposed to be conducted
pursuant to this Agreement, and ST-Sub is or will be licensed or qualified to
do business in each jurisdiction which the nature of the business conducted or
to be conducted by ST-Sub, or the character or location or the properties and
assets owned or leased by ST-Sub make such licensing or qualification
necessary, except where the failure to be so licensed or qualified (or steps
necessary to cure such failure) would not have a material adverse effect on the
Condition of SouthTrust on a consolidated basis. True and correct copies of
the Certificate or Articles of Incorporation and Bylaws of ST-Sub, as each may
be amended to the date hereof, will be made available to SBG.
(b) ST-Sub, as of the Effective Time of the Merger, will
have in effect all federal, state, local and foreign governmental, regulatory
or other authorizations, permits and licenses necessary for it to own or lease
its properties and assets and to carry on its business as proposed to be
conducted, the absence of which, either individually or in the aggregate, would
have a material adverse effect on the Condition of SouthTrust on a consolidated
basis.
(c) As of the Effective Time of the Merger, the minute
books of ST-Sub will contain complete and accurate records in all material
respects of all meetings and other corporate actions held or taken by the
shareholders and Board of Directors of ST-Sub.
Section 4.3 Capitalization. As of December 31, 1994, the
authorized capital stock of SouthTrust consisted of 200,000,000 shares of
common stock, par value $2.50 per share, ________________ shares (which
includes the rights associated with such shares pursuant to that certain Rights
Agreement dated as of February 22, 1989 between SouthTrust and Mellon Bank,
N.A.) of which are issued and outstanding (exclusive of any such shares
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held in the treasury of SouthTrust as of the date hereof), and 5,000,000 shares
of preferred stock, par value $1.00 per share, none of which is issued and
outstanding as of the date hereof. All issued and outstanding SouthTrust
Shares have been duly authorized and validly issued, and all such shares are
fully paid and nonassessable.
Section 4.4 Authorization. The execution, delivery, and
performance of this Agreement, and the consummation of the transactions
contemplated hereby and in any related agreements, have been or, as of the
Effective Time of the Merger and prior to the mailing of the Proxy Statement to
shareholders of SBG, will have been duly authorized by the Boards of Directors
of SouthTrust and ST-Sub, and no other corporate proceedings on the part of
SouthTrust or ST-Sub are or will be necessary to authorize this Agreement and
the transactions contemplated hereby. This Agreement is the valid and binding
obligation of SouthTrust and ST-Sub enforceable against each in accordance with
its terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
the enforcement of creditors rights generally and except that the availability
of the equitable remedy of specific performance or injunctive relief is subject
to the discretion of the court before which any proceeding may be brought.
Neither the execution, delivery or performance of this Agreement nor the
consummation of the transactions contemplated hereby will (i) violate any
provision of the Restated Certificate of Incorporation or Bylaws of SouthTrust
or the Articles or Certificate of Incorporation or Bylaws of ST-Sub or, (ii) to
SouthTrust's knowledge and assuming that any necessary Consents are duly
obtained, (A) violate, conflict with, result in a breach of any provisions of,
constitute a default (or an event which, with notice or lapse of time, or both,
would constitute a default) under, result in the termination of, accelerate the
performance required by or result in the creation of any lien, security
interest, charge or other encumbrance upon any of the properties or assets of
SouthTrust or ST-Sub under, any of the terms, conditions or provisions of any
note, bond, mortgage, indenture, deed of trust, license, permit, lease,
agreement or other instrument or obligation to which SouthTrust or ST-Sub is a
party, or by which SouthTrust or ST-Sub or any of their respective properties
or assets may be bound or affected, (B) violate any statute, code, ordinance,
rule, regulation, judgment, order, writ, decree or injunction applicable to
SouthTrust or ST-Sub or any of their respective material properties or assets,
except for (X) such conflicts, breaches or defaults as are set forth in
Disclosure Schedule 4.4; and (Y) with respect to (B) and (C) above, such as
individually or in the aggregate will not have a material adverse effect on the
Condition of SouthTrust on a consolidated basis.
Section 4.5 Financial Statements. (a) SouthTrust has made
available to SBG copies of the consolidated financial statements of SouthTrust
as of and for the years ended December 31, 1993 and 1992, and as of and for the
periods ended March 31, 1994, June 30, 1994, and September 30, 1994, and
SouthTrust will make available to SBG, as soon as practicable following the
preparation of additional consolidated financial statements for each subsequent
calendar quarter or year of SouthTrust, the consolidated financial statements
of SouthTrust as of and for such subsequent calendar quarter or year (such
consolidated financial statements, unless otherwise indicated, being
hereinafter referred to collectively as the "Financial Statements of
SouthTrust").
(b) Each of the Financial Statements of SouthTrust
(including the related notes) have been or will be prepared in all material
respects in accordance with generally accepted accounting principles, which
principles have been or will be consistently applied during the periods
involved, except as otherwise noted therein, and the books and records of
SouthTrust have been, are being, and will be maintained in all material
respects in accordance with applicable legal and accounting requirements and
reflect only the actual transactions. Each of the Financial Statements of
SouthTrust (including the related notes) fairly presents or will fairly present
the consolidated financial position of SouthTrust as of the respective dates
thereof and fairly presents or will fairly present the results of operations of
SouthTrust for the respective periods therein set forth.
(c) Since December 31, 1993, SouthTrust has not incurred
any obligation or liability (contingent or otherwise) that has or might
reasonably be expected to have, individually or in the aggregate, a material
adverse effect on the Condition of SouthTrust on a consolidated basis, except
obligations and liabilities (i) which are accrued or reserved against in the
Financial Statements of SouthTrust or reflected in the notes thereto, and (ii)
which were incurred after December 31, 1993 in the ordinary course of business
consistent with past practices. Since December 31, 1993, and except for the
matters described in (i) and (ii) above, SouthTrust has not incurred or paid
any obligation or liability which would be material to the Condition of
SouthTrust on a consolidated basis.
Section 4.6 Absence of Certain Changes or Events. Since December
31, 1993, there has not been any material adverse change in the Condition of
SouthTrust on a consolidated basis, and to the knowledge of
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SouthTrust, no fact or condition exists which might reasonably be expected to
cause such a material adverse change in the future.
Section 4.7 Legal Proceedings, Etc. Except as set forth on
Disclosure Schedule 4.7 hereto, SouthTrust is not a party to any, and there are
no pending, or, to the knowledge of SouthTrust, threatened, legal,
administrative, arbitrary or other proceedings, claims, actions, causes of
action or governmental investigations of any nature against SouthTrust
challenging the validity or propriety of the transactions contemplated by this
Agreement or which would be required to be reported by SouthTrust pursuant to
Item 103 of Regulation S-K promulgated by the SEC.
Section 4.8 Insurance. SouthTrust has in effect insurance
coverage with insurers which, in respect of amounts, premiums, types and risks
insured, constitutes reasonably adequate coverage against all risks customarily
insured against by institutions comparable in size and operation to SouthTrust.
Section 4.9 Consents and Approvals. Except for (i) the filing by
SouthTrust of the Registration Statement which shall include the Proxy
Statement with the SEC and the review and clearance thereof by the SEC (ii) the
Consents of the Georgia Department, the FRB and, in the case of the Subsidiary
Merger Agreement, the OCC; (iii) approval of this Agreement by the respective
shareholders of ST-Sub and SBG; (iv) filing of Articles of Merger with the
State of Georgia; and (v) as previously disclosed, no consents or approvals by,
or filings or registrations with, any third party or any public body, agency or
authority are necessary in connection with the execution and delivery by
SouthTrust and ST-Sub or, to the knowledge of SouthTrust, by SBG of this
Agreement, and the consummation of the Merger and the other transactions
contemplated hereby.
Section 4.10 Accounting, Tax, Regulatory Matters. SouthTrust has
not agreed to take any action, has no knowledge of any fact and has not agreed
to any circumstance that would (i) prevent the transactions contemplated
hereby, including the Merger, from qualifying as a reorganization within the
meaning of Section 368 of the Code, or (ii) materially impede or delay receipt
of any Consent from any Regulatory Authority referred to in the Agreement,
including matters relating to the Community Reinvestment Act and protests
thereunder.
Section 4.11 Proxy Materials. None of the information relating
solely to SouthTrust or any of its subsidiaries to be included or incorporated
by reference in the Proxy Statement which is to be mailed to the shareholders
of SBG in connection with the solicitation of their approval of this Agreement
will, at the time such Proxy Statement is mailed or at the time of the meeting
of shareholders of SBG to which such Proxy Statement relates, be false or
misleading with respect to any material fact, or omit to state any material
fact necessary in order to make a statement therein not false or misleading.
The legal responsibility for the contents of the information supplied by
SouthTrust and relating solely to SouthTrust which is either included or
incorporated by reference in the Proxy Statement shall be and remain with
SouthTrust.
Section 4.12 No Broker's or Finder's Fees. Neither SouthTrust nor
ST-Sub or any of their subsidiaries, affiliates or employers has employed any
broker or finder or incurred any liability for any broker's fees, commissions
or finder's fees in connection with this Agreement or the consummation of any
of the transactions contemplated herein.
Section 4.13 Untrue Statements and Omissions. No representation
or warranty contained in Article IV of this Agreement or in the Disclosure
Schedules of SouthTrust or ST-Sub contains any untrue statement of a material
fact or omits to state a material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading.
Section 4.14 Compliance with Laws. SouthTrust has conducted its
business in accordance with all applicable federal, foreign, state and local
laws, regulations and orders and is in compliance with such laws, regulations
and orders, except for such violations or noncompliance, which when taken
together as a whole, will not have a material adverse effect on the Condition
of SouthTrust. Except as disclosed in Disclosure Schedule 4.14, SouthTrust:
(a) To its knowledge, is not in violation of any laws,
orders or permits applicable to its business or the employees or agents or
representatives conducting its business, except for violations which
individually or in the aggregate do not have and will not have a material
adverse effect on the Condition of SouthTrust on a consolidated basis; and
(b) Has not received a notification or communication from
any agency or department of federal, state or local government or the
Regulatory Authorities or the staff thereof (i) asserting that SouthTrust is
not in
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compliance with any laws or orders which such governmental authority or
Regulatory Authority enforces, where such noncompliance is reasonably likely to
have a material adverse effect on the Condition of SouthTrust on a consolidated
basis, (ii) threatening to revoke any permit, the revocation of which is
reasonably likely to have a material adverse effect on the Condition of
SouthTrust on a consolidated basis, (iii) requiring SouthTrust to enter into
any cease and desist order, formal agreement, commitment or memorandum of
understanding, or to adopt any resolutions or similar undertakings, or (iv)
directing, restricting or limiting, or purporting to direct, restrict or limit
in any manner, the operations of SouthTrust, including, without limitation, any
restrictions on the payment of dividends.
ARTICLE V
COVENANTS AND AGREEMENTS
Section 5.1 Conduct of the Business of SBG. (a) During the
period from the date of this Agreement to the Effective Time of the Merger, SBG
shall, and shall cause Northside Bank and each direct or indirect subsidiary
to, (i) conduct its business in the usual, regular and ordinary course
consistent with past practice and prudent banking principles, (ii) use its best
efforts to maintain and preserve intact its business organization, employees,
goodwill with customers and advantageous business relationships and retain the
services of its officers and key employees, and (iii) except as required by law
or regulation, take no action which would adversely affect or delay the
ability, in any material respect, of SBG or SouthTrust to obtain any Consent
from any Regulatory Authorities or other approvals required for the
consummation of the transactions contemplated hereby or to perform its
covenants and agreements under this Agreement.
(b) During the period from the date of this Agreement to
the Effective Time of the Merger, except as required by law or regulation, SBG
shall not, and it shall not permit Northside Bank or any of their respective
subsidiaries, without the prior written consent of SouthTrust, to:
(i) change, delete or add any provision of or to the Articles of
Incorporation or Bylaws of SBG, Northside Bank or any of their
respective subsidiaries;
(ii) except for the issuance of SBG Shares pursuant to the terms of
the SBG Options, change the number of shares of the
authorized, issued or outstanding capital stock of SBG,
including any issuance, purchase, redemption, split,
combination or reclassification thereof, or issue or grant any
option, warrant, call, commitment, subscription, right or
agreement to purchase relating to the authorized or issued
capital stock of SBG, declare, set aside or pay any dividend
or other distribution with respect to the outstanding capital
stock of SBG;
(iii) incur any material liabilities or material obligations (other
than deposit liabilities and short-term borrowings in the
ordinary course of business), whether directly or by way of
guaranty, including any obligation for borrowed money, or
whether evidenced by any note, bond, debenture, or similar
instrument, except in the ordinary course of business
consistent with past practice;
(iv) make any capital expenditures individually in excess of
$25,000, or in the aggregate in excess of $50,000 other than
pursuant to binding commitments existing on December 31, 1994
and disclosed in a Disclosure Schedule delivered pursuant to
Article III of this Agreement or in the annexed Schedule
5.1(b)(iv) and other than expenditures necessary to maintain
existing assets in good repair;
(v) sell, transfer, convey or otherwise dispose of any real
property (including "other real estate owned") or interest
therein having a book value in excess of or in exchange for
consideration in excess of $10,000;
(vi) except for the bonuses to be paid to the employees identified
in Disclosure Schedule 5.1(b)(vi)(A), which bonuses are to be
paid as of the Effective Time of the Merger in the respective
amounts set forth in Disclosure Schedule 5.1(b)(vi)(A) to such
employees who remain employed by SBG or Northside Bank
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through the Effective Time of the Merger in the same or
similar capacities in which such employees are employed as of
the date hereof, and except for the payment described in the
letter agreement annexed hereto as Disclosure Schedule
5.1(b)(vi)(B), pay any bonuses to any employee; enter into any
new, or amend in any respect any existing, employment,
consulting, non-competition or independent contractor
agreement with any person; alter the terms of any existing
incentive bonus or commission plan; adopt any new or amend in
any material respect any existing employee benefit plan,
except as may be required by law; grant any general increase
in compensation to its employees as a class or to its officers
except for non-executive officers in the ordinary course of
business and consistent with past practices and policies or
except in accordance with the terms of an enforceable written
agreement; grant any material increases in fees or other
increases in compensation or in other benefits to any of its
directors; or effect any change in any material respect in
retirement benefits to any class of employees or officers,
except as required by law;
(vii) enter into or extend any agreement, lease or license relating
to real property, personal property, data processing or
bankcard functions relating to SBG, Northside Bank or any of
their respective subsidiaries that involves an aggregate of
$10,000; or
(viii) acquire twenty percent (20%) or more of the assets or equity
securities of any person or acquire direct or indirect control
of any person, other than in connection with (A) any internal
reorganization or consolidation involving existing
subsidiaries of SBG or Northside Bank which has been approved
in advance in writing by SouthTrust, (B) foreclosures in the
ordinary course of business, (C) acquisitions of control by a
banking subsidiary in a fiduciary capacity or (D) the creation
of new subsidiaries organized to conduct and continue
activities otherwise permitted by this Agreement.
Section 5.2 Current Information. During the period from the date
of this Agreement to the Effective Time of the Merger or the time of
termination or abandonment of this Agreement, SBG will cause one or more of its
designated representatives to confer on a regular and frequent basis with
representatives of SouthTrust and to report the general status of the ongoing
operations of SBG. SBG will promptly notify SouthTrust of any material change
in the normal course of business or the operations or the properties of SBG,
Northside Bank or any of their respective subsidiaries, any governmental
complaints, investigations or hearings (or communications indicating that the
same may be contemplated) affecting SBG, Northside Bank or their respective
subsidiaries, the institution or the threat of material litigation, claims,
threats or causes of action involving SBG, Northside Bank or any of their
respective subsidiaries, and will keep SouthTrust fully informed of such
events. SBG will furnish to SouthTrust, promptly after the preparation and/or
receipt by SBG thereof, copies of its unaudited periodic financial statements
and call reports for the applicable periods then ended, and such financial
statements and call reports shall, upon delivery to SouthTrust, be treated, for
purposes of Section 3.3 hereof, as among the Financial Statements of SBG, the
Financial Statements of Northside Bank and the Call Reports of Northside Bank.
Section 5.3 Access to Properties; Personnel and Records. (a) So
long as this Agreement shall remain in effect, SBG, Northside Bank and their
respective subsidiaries, shall permit SouthTrust or its agents full access,
during normal business hours, to the properties of SBG, Northside Bank and
their respective subsidiaries, and shall disclose and make available (together
with the right to copy) to SouthTrust and to its internal auditors, loan review
officers, attorneys, accountants and other representatives, all books, papers
and records relating to the assets, stock, properties, operations, obligations
and liabilities of SBG, Northside Bank or their respective subsidiaries,
including all books of account (including the general ledger), tax records,
minute books of directors' and shareholders' meetings, organizational
documents, bylaws, contracts and agreements, filings with any regulatory
agency, examination reports, correspondence with regulatory or taxing
authorities, documents relating to assets, titles, abstracts, appraisals,
consultant's reports, plans affecting employees, securities transfer records
and stockholder lists, and any other assets, business activities or prospects
in which SouthTrust may have a reasonable interest, and SBG, Northside Bank and
their respective subsidiaries shall use their reasonable best efforts to
provide SouthTrust and its representatives access
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to the work papers of SBG's, Northside Bank's and their respective
subsidiaries' accountants. SBG, Northside Bank and their respective
subsidiaries shall not be required to provide access to or to disclose
information where such access or disclosure would violate or prejudice the
rights of any customer, would contravene any law, rule, regulation, order or
judgment or would violate any confidentiality agreement; provided that SBG,
Northside Bank and their respective subsidiaries shall cooperate with
SouthTrust in seeking to obtain Consents from appropriate parties under whose
rights or authority access is otherwise restricted. The foregoing rights
granted to SouthTrust shall not, whether or not and regardless of the extent to
which the same are exercised, affect the representations and warranties made in
this Agreement by SBG, Northside Bank or their respective subsidiaries.
(b) As long as this Agreement shall remain in effect,
SouthTrust and ST-Sub shall permit SBG or its agents reasonable access, during
normal business hours, to such of the properties of SouthTrust and ST-Sub, and
shall disclose and make available (together with the right to copy) to SBG and
to its attorneys, accountants and other representatives, documents, bylaws,
contracts and agreements, filings with any regulatory agency, examination
reports, correspondence with regulatory or taxing authorities and such other
materials as, in light of the structure of the transactions contemplated by
this Agreement, including the relative sizes of SouthTrust and SBG, are
customary and reasonable under the circumstances. Without limiting the
foregoing, SouthTrust shall not be required to provide access to or to disclose
information where such access or disclosure would violate or prejudice the
rights of any customer, would contravene any law, rule, regulation, order or
judgement or would violate any confidentiality agreement. The foregoing rights
granted to SBG shall not, whether or not and regardless of the extent to which
the same are exercised, affect the representations and warranties made in this
Agreement by SouthTrust and ST-Sub.
(c) All information furnished by the parties hereto
pursuant to this Agreement shall be treated as the sole property of the party
providing such information until the consummation of the Merger contemplated
hereby and, if such transaction shall not occur, the party receiving the
information shall return to the party which furnished such information, all
documents or other materials containing, reflecting or referring to such
information, shall use its best efforts to keep confidential all such
information, and shall not directly or indirectly use such information for any
competitive or other commercial purposes. The obligation to keep such
information confidential shall continue for two (2) years from the date the
proposed transactions are abandoned but shall not apply to (i) any information
which (A) the party receiving the information was already in possession of
prior to disclosure thereof by the party furnishing the information, (B) was
then available to the public, or (C) became available to the public through no
fault of the party receiving the information; or (ii) disclosures pursuant to a
legal requirement or in accordance with an order of a court of competent
jurisdiction or regulatory agency; provided that the party which is the subject
of any such legal requirement or order shall use its best efforts to give the
other party at least ten (10) business days prior notice thereof. Each party
hereto acknowledges and agrees that a breach of any of their respective
obligations under this Section 5.3 would cause the other irreparable harm for
which there is no adequate remedy at law, and that, accordingly, each is
entitled to injunctive and other equitable relief for the enforcement thereof
in addition to damages or any other relief available at law.
Section 5.4 Approval of SBG Shareholders. SBG will take all
steps necessary under applicable laws to call, give notice of, convene and hold
a meeting of its shareholders at such time as may be mutually agreed to by the
parties for the purpose of approving this Agreement and the transactions
contemplated hereby and for such other purposes consistent with the complete
performance of this Agreement as may be necessary or desirable. Subject to the
receipt of the fairness opinion described in Section 9.10 hereof (if not
waived), the Board of Directors of SBG will recommend to its shareholders the
approval of this Agreement and the transactions contemplated hereby and SBG
will use its best efforts to obtain the necessary approvals by its shareholders
of this Agreement and the transactions contemplated hereby.
Section 5.5 No Other Bids. SBG, acting through any director or
officer or other agent shall not now, nor shall it knowingly permit any of its
subsidiaries to, nor shall it authorize or knowingly permit any officer,
director or employee of, or any investment banker, attorney, accountant or
other representative retained by SBG, Northside Bank or any of their respective
subsidiaries, to solicit or encourage, including by way of furnishing
information, any inquiries or the making of any proposal which may reasonably
be expected to lead to any takeover proposal with respect to SBG, Northside
Bank or any of their respective subsidiaries; provided, however, that the board
of directors of SBG may furnish information to any person making a takeover
proposal, and may discuss such takeover proposal with such person, if the board
of directors has been advised by counsel that its failure to do so would
violate its fiduciary duties. SBG shall promptly advise SouthTrust orally and
in writing of any such inquiries or proposals
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received by SBG, Northside Bank or any of their respective subsidiaries after
the date hereof. As used in this Section 5.5, "takeover proposal" shall mean
any proposal for a merger or other business combination involving SBG,
Northside Bank or any of their respective subsidiaries or for the acquisition
of a significant equity interest in SBG, Northside Bank or any of their
respective subsidiaries or for the acquisition of a significant portion of the
assets of SBG, Northside Bank or any of their respective subsidiaries.
Section 5.6 Notice of Deadlines. SBG shall notify SouthTrust in
writing of any deadline to exercise an extension or termination of any material
lease, agreement or license (including specifically real property leases and
data processing agreements) to which SBG, Northside Bank or any of their
respective subsidiaries is a party, at least ten (10) days prior to such
deadline.
Section 5.7 Affiliates. At least thirty (30) days prior to the
Effective Time of the Merger, SBG shall deliver to SouthTrust a letter
identifying all persons who are, at the time this Agreement is submitted for
approval to the shareholders of SBG, "affiliates" of SBG for purposes of Rule
145 under the Securities Act of 1933. SBG shall use all reasonable efforts to
cause each person who is identified as an "affiliate" in the letter referred to
above to deliver to SouthTrust not later than thirty (30) days or prior to the
Effective Time of the Merger, a written agreement, providing that such person
will not sell, pledge, transfer, or otherwise dispose of the SBG Shares held by
such person except as contemplated by such written agreement or by this
Agreement and will not sell, pledge, transfer, or otherwise dispose of the
SouthTrust Shares to be received by such person upon consummation of the Merger
except in compliance with applicable provisions of the Securities Act of 1933,
and the rules and regulations thereunder and until such time as the financial
results covering at least thirty (30) days of combined operations of SouthTrust
and SBG have been published within the meaning of Section 201.01 of the SEC's
Codification of Financial Reporting Policies. If the Merger will qualify for
pooling-of-interests accounting treatment, the SouthTrust Shares issued to such
affiliates of SBG in exchange for the SBG Shares shall not be transferable
until such time as the financial results covering at least thirty (30) days of
combined operations of SouthTrust and SBG have been published within the
meaning of Section 201.01 of the SEC's Codification of Financial Reporting
Policies regardless of whether each such person has provided the written
agreement referred to in this Section 5.7. SouthTrust shall not be
required to maintain the effectiveness of the Registration Statement under the
Securities Act of 1933 for the purposes of resale of SouthTrust Shares by such
persons.
Section 5.8 Maintenance of Properties. SBG, Northside Bank and
their respective subsidiaries will maintain their respective properties and
assets in satisfactory condition and repair for the purposes for which they are
intended, ordinary wear and tear excepted.
Section 5.9 Environmental Audits. At the election of SouthTrust
made at least 60 days prior to the Effective Time of the Merger, SBG will, at
SouthTrust's expense, with respect to each parcel of real property that SBG,
Northside Bank or any of their respective subsidiaries owns, leases or
subleases, procure and deliver to SouthTrust, at least thirty (30) days prior
to the Effective Time of the Merger, a Phase I environmental audit, which audit
shall be reasonably acceptable to and shall be conducted by a firm reasonably
acceptable to SouthTrust.
Section 5.10 Title Insurance. At the election of SouthTrust made
at least 60 days prior to the Effective Time of the Merger, SBG will, at
SouthTrust's expense, with respect to each parcel of real property that SBG,
Northside Bank or any of their respective subsidiaries owns, leases or
subleases, procure and deliver to SouthTrust, at least thirty (30) days prior
to the Effective Time of the Merger, owner's title insurance issued in such
amounts and by such insurance company reasonably acceptable to SouthTrust,
which policy shall be free of all material exceptions to SouthTrust's
reasonable satisfaction.
Section 5.11 Surveys. At the election of SouthTrust made at least
60 days prior to the Effective Time of the Merger, with respect to each parcel
of real property as to which a title insurance policy is to be procured
pursuant to Section 5.10, SBG, at SouthTrust's expense, will procure and
deliver to SouthTrust at least thirty (30) days prior to the Effective Time of
the Merger, a survey of such real property, which survey shall be reasonably
acceptable to and shall be prepared by a licensed surveyor reasonably
acceptable to SouthTrust, disclosing the locations of all improvements,
easements, sidewalks, roadways, utility lines and other matters customarily
shown on such surveys and showing access affirmatively to public streets and
roads and providing the legal description of the property in a form suitable
for recording and insuring the title thereof (the "Survey"). The Survey shall
not disclose any survey defect or encroachment from or onto such real property
that has not been cured or insured over prior to the Effective Time of the
Merger.
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Section 5.12 Compliance Matters. Prior to the Effective Time of
the Merger, SBG shall take, or cause to be taken, all steps reasonably
requested by SouthTrust to cure any deficiencies in regulatory compliance by
SBG, Northside Bank or any of their respective subsidiaries, including
compliance with Regulations Z and CC of the FRB); provided that neither
SouthTrust nor ST-Sub shall be responsible for discovering or have any
obligation to disclose the existence of such defects to SBG nor shall
SouthTrust or ST-Sub have any liability resulting from such deficiencies or
attempts to cure them.
Section 5.13 Exemption Under Anti-Takeover Statutes. Prior to the
Effective Time of the Merger, SBG will use its best efforts to take all steps,
if any, required to exempt the transactions contemplated by this Agreement from
any applicable state anti-takeover law.
Section 5.14 Subsidiary Merger Agreement. Prior to the Effective
Time of the Merger, ST-Bank and Northside Bank shall have executed and
delivered the Subsidiary Merger Agreement substantially in the form annexed
hereto as Exhibit 6.3. SBG agrees that it shall vote by action by written
consent or as otherwise required the shares of capital stock of Northside Bank
held by SBG in favor of such Subsidiary Merger Agreement and the transactions
contemplated thereby.
ARTICLE VI
ADDITIONAL COVENANTS AND AGREEMENTS
Section 6.1 Best Efforts; Cooperation. Subject to the terms and
conditions herein provided, each of the parties hereto agrees to use its best
efforts promptly to take, or cause to be taken, all actions and to do, or cause
to be done, all things necessary, proper or advisable under applicable laws and
regulations, or otherwise, including attempting to obtain all necessary
Consents, to consummate and make effective, as soon as practicable, the
transactions contemplated by this Agreement.
Section 6.2 Regulatory Matters. (a) Following the execution and
delivery of this Agreement, SouthTrust and SBG shall cause to be prepared and
filed all required applications and filings with the Regulatory Authorities
which are necessary or contemplated for the obtaining of the Consents of the
Regulatory Authorities or consummation of the Merger. Such applications and
filings shall be in such form as may be prescribed by the respective government
agencies and shall contain such information as they may require. The parties
hereto will cooperate with each other and use their best efforts to prepare and
execute all necessary documentation, to effect all necessary or contemplated
filings and to obtain all necessary or contemplated permits, consents,
approvals, rulings and authorizations of government agencies and third parties
which are necessary or contemplated to consummate the transactions contemplated
by this Agreement, including, without limitation, those required or
contemplated from the Regulatory Authorities, and the shareholders of SBG.
Each of the parties shall have the right to review and approve in advance,
which approval shall not be unreasonably withheld, any filing made with, or
written material submitted to, any government agencies in connection with the
transactions contemplated by this Agreement.
(b) Each party hereto will furnish the other party with
all information concerning itself, its subsidiaries, directors, trustees,
officers, shareholders and depositors, as applicable, and such other matters as
may be necessary or advisable in connection with any statement or application
made by or on behalf of any such party to any governmental body in connection
with the transactions, applications or filings contemplated by this Agreement.
Upon request, the parties hereto will promptly furnish each other with copies
of written communications received by them or their respective subsidiaries
from, or delivered by any of the foregoing to, any governmental body in respect
of the transactions contemplated hereby.
Section 6.3 Other Matters. (a) The parties acknowledge that
nothing in this Agreement shall be construed as constituting an employment
agreement between SouthTrust or any of its affiliates and any officer or
employee of SBG, Northside Bank or any of their respective subsidiaries or an
obligation on the part of SouthTrust or any of its affiliates to employ any
such officers or employees, except that Southtrust agrees that it shall cause
ST-Sub and ST-Bank to assume and be bound by the severance policy of Northside
Bank as set forth in Disclosure Schedule 5.15 attached hereto if any Northside
Bank employees covered by such severance policy are terminated by SouthTrust,
ST-Sub or ST-Bank within one (1) year following the Effective Time of the
Merger; provided, however, that if the severance policy of SouthTrust
contemplates severance payments that are at least comparable
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to those contemplated by the severance policy of Northside Bank, SouthTrust,
prior to the expiration of the one year period, may elect to cover such
Northside Bank employees under SouthTrust's severance policy.
(b) The parties agree that appropriate steps shall be
taken to terminate all employee benefit plans of SBG other than the SBG 401(k)
Plan (the "SBG 401(k) Plan"), as of the Effective Time of the Merger or as
promptly as practicable thereafter. Following the termination of all such
plans (other than the SBG 401(k) Plan), and subject to Section 6.3(c) hereof,
SouthTrust agrees that the officers and employees of SBG who the Surviving
Corporation employs shall be eligible to participate in SouthTrust's employee
benefit plans, including welfare and fringe benefit plans on the same basis as
and subject to the same conditions as are applicable to any newly-hired
employee of SouthTrust; provided, however, that:
(i) with respect to SouthTrust's group medical
insurance plan, SouthTrust shall credit each such employee for
eligible expenses incurred by such employee and his or her
dependents (if applicable) under SBG's group medical insurance
plan during the current calendar year for purposes of
satisfying the deductible provisions under SouthTrust's plan
for such current year, and SouthTrust shall waive all waiting
periods under said plans for pre-existing conditions; and
(ii) credit for each such employee's past service
with SBG, Northside Bank or any of their respective
subsidiaries prior to the Effective Time of the Merger ("Past
Service Credit") shall be given by SouthTrust to such
employees for purposes of:
(1) determining vacation and sick leave
benefits and accruals, in accordance with the
established policies of SouthTrust;
(2) establishing eligibility for
participation in and vesting under SouthTrust's
employee benefit plans (including welfare and fringe
benefit plans), and for purposes of determining the
scheduling of vacations and other determinations
(including severance pay) which are made based on
length of service;provided, however, notwithstanding
anything contained in this Agreement to the contrary,
past service credit shall not be given to any such
employee for purposes of establishing eligibility for
participation in the 1990 Discounted Stock Plan of
SouthTrust.
(c) The parties further agree that the SBG 401(k) Plan will either
be merged into the SouthTrust Corporation Employee's Profit Sharing Plan (the
"ST PS Plan") or terminated effective as of December 31 of the year in which
the Effective Time of the Merger occurs, or, if so elected by SouthTrust, as of
the last day of the plan's first plan year ending after the Effective Time of
the Merger. The determination as to whether the SBG 401(k) Plan shall be
terminated or merged into the ST PS Plan shall be made by SouthTrust. From and
after the termination of the SBG 401(k) Plan or the merger of the plan into the
ST PS Plan for purposes of determining eligibility to participate in, and
vesting in accrued benefits under both the ST PS Plan and the SouthTrust
Corporation Revised Retirement Income Plan (the "ST Retirement Plan"),
employment by SBG shall be credited as if it were employment by SouthTrust, but
such service shall not be credited for purposes of determining benefit accrual
under the ST Retirement Plan.
Section 6.4 Indemnification. (a) SBG agrees to indemnify, defend
and hold harmless SouthTrust and its subsidiaries, and each of their respective
present and former officers, directors, employees and agents, from and against
all losses, expenses, claims, damages or liabilities to which any of them may
become subject under applicable laws (including, but not limited to, the
Securities Act of 1933 or the Securities Exchange Act of 1934), and will
reimburse each of them for any legal, accounting or other expenses reasonably
incurred in connection with investigating or defending any such actions,
whether or not resulting in liability, insofar as such losses, expenses,
claims, damages or liabilities arise out of or are based upon any untrue
statement or alleged untrue statement of material fact supplied to SouthTrust
by SBG or Northside Bank and contained in the Proxy Statement or any
application for the approval of the transactions contemplated by this Agreement
filed with any Regulatory Authority or arise out of or are based upon the
omission or alleged omission to state therein a material fact necessary to make
the statements therein, in light of the circumstances under which they were
made not misleading.
(b) SouthTrust agrees to indemnify, defend and hold
harmless SBG and its subsidiaries and each of their present and former
officers, directors, employees and agents from and against all losses,
expenses, claims, damages or liabilities to which any of them may become
subject under applicable laws (including, but not
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limited to, the Securities Act of 1933 or the Securities Exchange Act of 1934),
and will reimburse each of them for any legal, accounting or other expenses
reasonably incurred in connection with investigating or defending any such
actions, whether or not resulting in liability, insofar as such losses,
expenses, claims, damages or liabilities arise out of or are based upon any
untrue statement or alleged untrue statement of material fact supplied by
SouthTrust and contained in the Registration Statement, the Proxy Statement or
any application for the approval of the transactions contemplated by this
Agreement filed with any Regulatory Authority or arise out of or are based upon
the omission by SouthTrust or alleged omission by SouthTrust to state therein a
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(c) With respect to any claim made or action commenced
within six (6) years after the Effective Time of the Merger, SouthTrust shall
indemnify and hold harmless to the extent permitted by the provisions of the
Articles of Incorporation and Bylaws of SBG and Northside Bank, each as in
effect as of the date hereof, each director, officer, and employee of SBG and
Northside Bank against any costs or expenses (including attorneys fees),
judgments, fines, losses, threatened or completed action, suit, proceeding or
investigation (whether civil, criminal, administrative or investigative)
arising out of or pertaining to any action or omission by such director,
officer or employee on or prior to the Effective Time of the Merger in his
capacity as such, provided, however, that the aggregate amount of such
indemnification shall not exceed $3,000,000, and that such indemnification
shall be to the fullest extent permitted by applicable Georgia law.
(d) From and after the Effective Time of the Merger, the
directors, officers and employees of SBG and Northside Bank who become or serve
as directors, officers or employees of SouthTrust, ST-Bank or any affiliate of
SouthTrust shall have indemnification rights having prospective application
only, except as set forth in (c) above and except to the extent that (a) above
is applicable. These prospective indemnification rights shall consist of such
rights to which directors, officers and employees of subsidiaries or affiliates
of SouthTrust would be entitled under the Certificate or Articles of
Incorporation or Association and Bylaws of the particular subsidiary for which
they are serving as directors, officers or employees, the Restated Certificate
of Incorporation and Bylaws of SouthTrust, and such directors and officers
liability insurance coverage policy as SouthTrust may then make available to
directors, officers and employees of SouthTrust or any affiliate thereof.
Section 6.5 Current Information. During the period from the date
of this Agreement to the Effective Time of the Merger or the time of
termination or abandonment hereunder, SouthTrust will cause one or more of its
designated representatives to confer on a regular and frequent basis with SBG
and to report with respect to the general status and the ongoing operations of
SouthTrust.
Section 6.6 Registration Statement. SouthTrust shall cause the
Registration Statement to be filed and shall use its best efforts to cause such
Registration Statement to be declared effective under the Securities Act of
1933, which Registration Statement, at the time it becomes effective, and at
the Effective Time of the Merger, shall in all material respects conform to the
requirements of the Securities Act of 1933 and the general rules and
regulations of the SEC under the Securities Act of 1933. The Registration
Statement shall include the form of Proxy Statement for the meeting of SBG's
shareholders to be held for the purpose of having such shareholders vote upon
the approval of this Agreement. SBG will furnish to SouthTrust the information
required to be included in the Registration Statement with respect to its
business and affairs before it is filed with the SEC and again before any
amendments are filed. SouthTrust shall take all actions required to qualify or
obtain exemptions from such qualifications for the SouthTrust Shares to be
issued in connection with the transactions contemplated by this Agreement under
applicable state blue sky securities laws, as appropriate.
Section 6.7 Reservation of Shares. SouthTrust shall reserve for
issuance such number of SouthTrust Shares as shall be necessary (i) to pay the
holders of SBG Shares the consideration contemplated in this Agreement and (ii)
to comply with the provisions of Section 2.2(b). If at any time the aggregate
number of SouthTrust Shares remaining unissued (or in treasury) shall not be
sufficient to meet such obligation, SouthTrust shall take all appropriate
actions to increase the amount of its authorized common stock.
Section 6.8 Consideration. SouthTrust shall issue the SouthTrust
Shares to holders of SBG Shares and shall pay or cause to be paid to holders of
SBG Shares all cash payments as and when the same shall be required to be
issued and paid pursuant to this Agreement.
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ARTICLE VII
MUTUAL CONDITIONS TO CLOSING
The obligations of SouthTrust and ST-Sub, on the one hand, and SBG, on
the other hand, to consummate the transactions provided for herein shall be
subject to the satisfaction of the following conditions, unless waived as
hereinafter provided for:
Section 7.1 Shareholder Approval. The Merger shall have been
approved by the requisite vote of the shareholders of SBG and the sole
shareholder of ST-Sub.
Section 7.2 Regulatory Approvals. All necessary Consents of the
Regulatory Authorities shall have been obtained and all notice and waiting
periods required by law to pass after receipt of such Consents shall have
passed, and all conditions to consummation of the Merger set forth in such
Consents shall have been satisfied.
Section 7.3 Litigation. There shall be no actual or threatened
causes of action, investigations or proceedings (i) challenging the validity or
legality of this Agreement or the consummation of the transactions contemplated
by this Agreement, or (ii) seeking damages in connection with the transactions
contemplated by this Agreement, or (iii) seeking to restrain or invalidate the
transactions contemplated by this Agreement, which, in the case of (i) through
(iii), and in the reasonable judgment of either SouthTrust or SBG, based upon
advice of counsel, would have a material adverse effect with respect to the
interests of SouthTrust or SBG, as the case may be.
Section 7.4 Proxy Statement and Registration Statement. The
Registration Statement shall have been declared effective by the SEC, no stop
order suspending the effectiveness of the Registration Statement shall have
been issued, no action, suit, proceeding or investigation by the SEC to suspend
the effectiveness of the Registration Statement shall have been initiated, and
SouthTrust shall have received all state securities laws, or "Blue Sky" permits
or other authorizations, or confirmations as to the availability of exemptions
from registration requirements, as may be necessary to issue the SouthTrust
Shares pursuant to the terms of this Agreement.
ARTICLE VIII
CONDITIONS TO THE OBLIGATIONS OF SOUTHTRUST AND ST-SUB
The obligations of SouthTrust and ST-Sub to consummate the Merger are
subject to the fulfillment of each of the following conditions, unless waived
as hereinafter provided for:
Section 8.1 Representations and Warranties. The representations
and warranties of SBG set forth in this Agreement and in any certificate or
document delivered pursuant hereto shall be true and correct in all material
respects as of the date of this Agreement and as of all times up to and
including the Effective Time of the Merger (as though made on and as of the
Effective Time of the Merger except to the extent such representations and
warranties are by their express provisions made as of a specified date and
except for changes therein contemplated by this Agreement).
Section 8.2 Performance of Obligations. SBG shall have performed
all covenants, obligations and agreements required to be performed by it under
this Agreement prior to the Effective Time of the Merger.
Section 8.3 Certificate Representing Satisfaction of Conditions.
SBG shall have delivered to SouthTrust and ST-Sub a certificate of SBG dated as
of the Closing Date as to the satisfaction of the matters described in Sections
8.1 and 8.2 hereof, and such certificate shall be deemed to constitute
additional representations, warranties, covenants, and agreements of SBG under
Article III of this Agreement.
Section 8.4 Absence of Adverse Facts. No fact, event or
condition exists or has occurred that, in the reasonable judgment of
SouthTrust, (a) would have a material adverse effect on, or which may be
foreseen to have a material adverse effect on, the Condition of SBG on a
consolidated basis or the consummation of the transactions contemplated by this
Agreement, or (b) would be of such significance with respect to the business or
economic benefits expected to be obtained by SouthTrust pursuant to this
Agreement as to render inadvisable the consummation of the transactions
pursuant to this Agreement, provided, however, that any change in the last
sales
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price of the SouthTrust Shares, as reported by Nasdaq, shall not be taken into
account in determining whether any fact, event or condition described in this
Section 8.4(b) has occurred, (c) would be materially adverse to the interests
of SouthTrust on a consolidated basis or (d) would render the Merger or the
other transactions contemplated by this Agreement impractical because of any
state of war, national emergency, banking moratorium or general suspension of
trading on NASDAQ, the New York Stock Exchange, Inc. or other national
securities exchange.
Section 8.5 Opinion of Counsel. SouthTrust shall have received
an opinion of counsel from Glass, McCullough, Sherrill & Harrold or other
counsel to SBG acceptable to SouthTrust in substantially the form set forth in
Exhibit 8.5 hereof.
Section 8.6 Consents Under Agreements. SBG shall have obtained
the consent or approval of each person (other than the Consents of the
Regulatory Authorities) whose consent or approval shall be required in order to
permit the succession by the Surviving Corporation to any obligation, right or
interest of SBG under any loan or credit agreement, note, mortgage, indenture,
lease, license, or other agreement or instrument, except those for which
failure to obtain such consents and approvals would not in the opinion of
SouthTrust, individually or in the aggregate, have a material adverse effect on
the Surviving Corporation or upon the consummation of the transactions
contemplated by this Agreement.
Section 8.7 Material Condition. There shall not be any action
taken, or any statute, rule, regulation or order enacted, entered, enforced or
deemed applicable to the Merger by any Regulatory Authority which, in
connection with the grant of any Consent by any Regulatory Authority, imposes,
in the reasonable judgment of SouthTrust, any material adverse requirement upon
SouthTrust or its subsidiaries, including, without limitation, any requirement
that SouthTrust sell or dispose of any significant amount of the assets of SBG
or any other banking or other subsidiary of SouthTrust, provided that, except
for any such requirement relating to the above-described sale or disposition of
any significant assets of SBG or any banking or other subsidiary of SouthTrust,
no such term or condition imposed by any Regulatory Authority in connection
with the grant of any Consent by any Regulatory Authority shall be deemed to be
a material adverse requirement unless it materially differs from terms and
conditions customarily imposed by any such entity in connection with the
acquisition of banks and bank holding companies under similar circumstances.
Section 8.8 Matters Relating to Employment Agreements. Except as
described in Section 6.3(a) above, all employment agreements between SBG,
Northside Bank, any of their respective subsidiaries and any executive or
employee thereof shall be terminated in their entirety as of the Effective Time
of the Merger, and at the election of SouthTrust, replacement employment
agreements, which are satisfactory to SouthTrust and such employees, between
each of such executives or employees and SouthTrust or the Surviving
Corporation shall have been executed and delivered.
Section 8.9 Acknowledgment of Option Conversion. Each holder of
a SBG Option outstanding immediately prior to the Effective Time of the Merger
shall have executed and delivered to SouthTrust such instruments as SouthTrust
may deem necessary to evidence the assumption by SouthTrust of the SBG Options
as contemplated in and provided for by Section 2.2 hereof.
Section 8.10 Outstanding Shares of SBG. The total number of SBG
Shares outstanding as of the Effective Time of the Merger and the total number
of SBG Shares covered by any option, warrant, commitment, or other right or
instrument to purchase or acquire any SBG Shares that are outstanding as of the
Effective Time of the Merger, including any securities or rights convertible
into or exchangeable for SBG Shares, shall not exceed 1,925,994 shares in the
aggregate.
Section 8.11 Dissenters. The holders of not more than five
percent (5%) of the outstanding SBG Shares shall have elected to exercise their
right to dissent from the Merger and demand payment in cash for the fair value
of their shares.
Section 8.12 Certification of Claims. SBG shall have delivered a
certificate to SouthTrust that SBG is not aware of any pending or threatened
claim under the directors and officers insurance policy or the fidelity bond
coverage of SBG.
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ARTICLE IX
CONDITIONS TO OBLIGATIONS OF SBG
The obligation of SBG to consummate the Merger as contemplated herein
is subject to each of the following conditions, unless waived as hereinafter
provided for:
Section 9.1 Representations and Warranties. The representations
and warranties of SouthTrust and ST-Sub contained in this Agreement or in any
certificate or document delivered pursuant to the provisions hereof will be
true and correct as of the date of this Agreement and as of all times up to and
including the Effective Time of the Merger (as though made on and as of the
Effective Time of the Merger).
Section 9.2 Performance of Obligations. SouthTrust and ST-Sub
shall have performed all covenants, obligations and agreements required to be
performed by them and under this Agreement prior to the Effective Time of the
Merger.
Section 9.3 Certificate Representing Satisfaction of Conditions.
SouthTrust and ST-Sub shall have delivered to SBG a certificate of SouthTrust
and ST-Sub dated as of the Effective Time of the Merger as to the satisfaction
of the matters described in Sections 9.1 and 9.2 hereof, and such certificate
shall be deemed to constitute additional representations, warranties,
covenants, and agreements of SouthTrust and ST-Sub under Article IV of this
Agreement.
Section 9.4 Absence of Adverse Facts. No fact, event or
condition exists or has occurred that, in the reasonable judgment of SBG, (a)
would have a material adverse effect on, or which may be foreseen to have a
material adverse effect on, the Condition of SouthTrust or the consummation of
the transactions contemplated by this Agreement, or (b) would render the Merger
or the other transactions contemplated by this Agreement impractical because of
any state of war, national emergency, banking moratorium, or a general
suspension of trading on NASDAQ, the New York Stock Exchange, Inc. or other
national securities exchange.
Section 9.5 Consents Under Agreements. SouthTrust and ST-Sub
shall have obtained the consent or approval of each person (other than the
Consents of Regulatory Authorities) whose consent or approval shall be required
in connection with the transactions contemplated hereby including under any
loan or credit agreement, note, mortgage, indenture, lease, license or other
agreement or instrument, except those for which failure to obtain such consents
and approvals would not, in the opinion of SBG, individually or in the
aggregate, have a material adverse effect upon the consummation of the
transactions contemplated hereby.
Section 9.6 Opinion of Counsel. SBG shall have received the
opinion of Bradley, Arant, Rose & White, counsel to SouthTrust, dated the
Effective Time of the Merger, to the effect set forth in Exhibit 9.6 hereof.
Section 9.7 SouthTrust Shares. The SouthTrust Shares to be
issued in connection herewith shall be duly authorized and validly issued and,
fully paid and nonassessable, issued free of preemptive rights and free and
clear of all liens and encumbrances created by or through SouthTrust.
Section 9.8 Tax Opinion. SBG shall have received an opinion of
Glass, McCullough, Sherrill & Harrold or SBG's independent public accountants,
on or before the date on which the Proxy Statement of SBG is to be mailed to
holders of SBG Shares, to the effect, among others, that the Merger will
constitute a reorganization within the meaning of Section 368 of the Code and
that no gain or loss will be recognized by the shareholders of SBG to the
extent that they receive SouthTrust Shares in exchange for their SBG Shares in
the Merger.
Section 9.9 Price of SouthTrust Shares. The average last sale
price of the SouthTrust Shares to be issued in connection herewith, as reported
by NASDAQ for the twenty (20) trading days immediately preceding the Effective
Time of the Merger and the last sales price as reported by Nasdaq for the last
trading day immediately preceding the Effective Time of the Merger, shall not
be less than $16.00 per SouthTrust Share, subject to appropriate adjustment for
the events described in Section 2.1 above, unless SouthTrust, in its sole
discretion, adjusts the Conversion Ratio so that the product of the Conversion
Ratio times the lower of such average sales price or such sales price on the
trading day immediately preceding the Effective Time of the Merger equals
8.441064.
Section 9.10 Fairness Opinion. The Board of Directors of SBG
shall have received an opinion, dated not more than five (5) business days
prior to the date of the Proxy Statement of SBG to be mailed to the
shareholders of SBG for purposes of considering and voting upon the Merger,
from an investment banker or bank consultant
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<PAGE> 40
acceptable to SBG that the consideration to be received by the shareholders of
SBG in the Merger is fair to the shareholders of SBG from a financial point of
view.
ARTICLE X
TERMINATION, WAIVER AND AMENDMENT
Section 10.1 Termination. This Agreement may be terminated and
the Merger abandoned at any time prior to the Effective Time of the Merger:
(a) by the mutual consent in writing of SouthTrust and
SBG; or
(b) by SouthTrust or SBG if the Merger shall not have
occurred on or prior to September 30, 1995, provided that the failure to
consummate the Merger on or before such date is not caused by any breach of any
of the representations, warranties, covenants or other agreements contained
herein by the party electing to terminate pursuant to this Section 10.1(b);
(c) by SouthTrust or SBG (provided that the terminating
party is not then in breach of any representation, warranty, covenant or other
agreement contained herein) in the event that any of the conditions precedent
to the obligations of the nonterminating party to consummate the Merger cannot
be satisfied or fulfilled;
(d) by SouthTrust if: (i) SouthTrust shall have
determined that any fact, event or condition exists that, in the reasonable
judgment of SouthTrust, (A) is materially at variance with any warranty or
representation of SBG, Northside Bank or any of their respective subsidiaries
set forth in the Agreement or is a material breach of any covenant or agreement
of SBG, Northside Bank or any of their respective subsidiaries contained in the
Agreement, (B) has a material adverse effect or can be reasonably foreseen to
have a material adverse effect upon the Condition of SBG on a consolidated
basis or upon the consummation of the transactions contemplated by the
Agreement, (C) would be materially adverse to the interests of SouthTrust and
ST-Sub on a consolidated basis, (D) would be of such significance with respect
to the business or economic benefits expected to be obtained by SouthTrust
under this Agreement so as to render inadvisable consummation of the
transactions contemplated by the Agreement, provided, however, that any change
in the last sales price of SouthTrust Shares, as reported by Nasdaq, shall not
be deemed a fact, event or condition that gives rise to any right of
termination under this Section 10.1(d)(i)(D), (E) renders the Merger or the
other transactions contemplated by this Agreement impractical because of any
state of war, national emergency, banking moratorium or general suspension of
trading on NASDAQ, the New York Stock Exchange, Inc. or any other national
securities exchange; or (ii) there shall be any litigation or threat of
litigation (A) challenging the validity or legality of this Agreement or the
consummation of the transactions contemplated by this Agreement, (B) seeking
damages in connection with the consummation of the transactions contemplated by
this Agreement or (C) seeking to restrain or invalidate the consummation of the
transactions contemplated by this Agreement.
(e) by SBG if (i) SBG shall have determined that any
fact, event or condition exists that, in the reasonable judgment of SBG, (A) is
materially at variance with any warranty or representation of SouthTrust or
ST-Sub contained in the Agreement or is a material breach of any covenant or
agreement of SouthTrust of ST-Sub contained in the Agreement, (B) has a
material adverse effect or can be reasonably seen to have a material adverse
effect upon the consummation of the transactions contemplated by the Agreement,
(ii) there shall be any litigation or threat of litigation (A) challenging the
validity or legality of this Agreement or the consummation of the transactions
contemplated by this Agreement, (B) seeking damages in connection with the
consummation of the transactions contemplated by this Agreement or (C) seeking
to restrain or invalidate the consummation of transactions contemplated by this
Agreement, or (iii) SBG shall have determined that any fact, event or condition
exists that, in the judgment of SBG, would render the Merger and the other
transactions contemplated by this Agreement impractical because of any state of
war, national emergency, banking moratorium or general suspension of trading on
NASDAQ, the New York Stock Exchange, Inc. or other national securities
exchange.
Section 10.2 Effect of Termination. In the event of the
termination and abandonment of this Agreement as herein provided, it shall
terminate as herein provided and become void, without liability on behalf of
any party, and have no effect, except as otherwise provided herein.
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<PAGE> 41
Section 10.3 Amendments. To the extent permitted by law, this
Agreement may be amended by a subsequent writing signed by each of SouthTrust,
ST-Sub and SBG.
Section 10.4 Waivers. Subject to Section 11.10 hereof, prior to
or at the Effective Time of the Merger, SouthTrust and ST-Sub, on the one hand,
and SBG, on the other hand, shall have the right to waive any default in the
performance of any term of this Agreement by the other, to waive or extend the
time for the compliance or fulfillment by the other of any and all of the
other's obligations under this Agreement and to waive any or all of the
conditions to its obligations under this Agreement, except any condition,
which, if not satisfied, would result in the violation of any law or any
applicable governmental regulation.
Section 10.5 Non-Survival of Representations and Warranties. No
representations, warranties, covenants or agreements in this Agreement or in
any instrument delivered by SouthTrust, ST-Sub or SBG shall survive the
Effective Time of the Merger or the termination of this Agreement pursuant to
Section 10.1; provided, however, that the agreements set forth in Articles I
and II, Sections 5.7, 6.3, 6.4 and 10.2 and Article XI shall not so terminate
and shall not be so extinguished; provided further that any representation or
warranty in any agreement, contract, report, opinion, undertaking or other
document or instrument delivered hereunder in whole or in part by any person
other than SouthTrust, ST-Sub, SBG or Northside Bank (or directors and officers
thereof in their capacities as such) shall not so terminate and shall not be so
extinguished; and provided further, that no representation or warranty of
SouthTrust, ST-Sub, SBG or Northside Bank contained herein shall be deemed to
be terminated or extinguished so as to deprive SouthTrust or ST-Sub, on the one
hand, and SBG or Northside Bank, on the other hand, of any defense at law or in
equity which any of them otherwise would have to any claim against them by any
person, including, without limitation, any shareholder or former shareholder of
either party. No representation or warranty in this Agreement shall be
affected or deemed waived by reason of the fact that SouthTrust, ST-Sub, SBG or
Northside Bank and/or its representatives knew or should have known that any
such representation or warranty was, or is, inaccurate in any material respect.
ARTICLE XI
MISCELLANEOUS
Section 11.1 Entire Agreement. This Agreement and the documents
referred to herein contain the entire agreement among SouthTrust, ST-Sub and
SBG with respect to the transactions contemplated hereunder and this Agreement
supersedes all prior arrangements or understandings with respect thereto,
whether written or oral, including that letter of intent between the parties
dated December 14, 1994. The terms and conditions of this Agreement shall
inure to the benefit of and be binding upon the parties hereto and their
respective successors. Nothing in this Agreement, expressed or implied, is
intended to confer upon any person, firm, corporation or entity, other than the
parties hereto and their respective successors, any rights, remedies,
obligations or liabilities under or by reason of this Agreement.
Section 11.2 Notices. All notices or other communications which
are required or permitted hereunder shall be in writing and sufficient if
delivered personally or sent by first class or registered or certified mail,
postage prepaid, telegram or telex or other facsimile transmission addressed as
follows:
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If to SBG:
P.O. Box 309
Roswell, Georgia 30077
11180 Alpharetta Highway, Roswell, Georgia
Attention: Mr. E. Lamar Seals
Fax: (404) 664-1637
with a copy to:
Glass, McCullough, Sherrill & Harrold
1409 Peachtree Street, N.E.
Atlanta, Georgia 30309
Attention: T. Kennerly Carroll, Jr.
Fax: (404) 885-6779
If to ST-Sub or SouthTrust, then to:
SouthTrust Corporation
420 North 20th Street
Birmingham, Alabama 35203
Attention: Mr. Frederick W. Murray, Jr.
Fax (205) 254-5022
with a copy to:
Bradley, Arant, Rose & White
1400 Park Place Tower
2001 Park Place
Birmingham, Alabama 35203
Attention: C. Larimore Whitaker, Esq.
Fax (205) 251-8611
All such notices or other communications shall be deemed to
have been delivered (i) upon receipt when delivery is made by hand, (ii) on the
third (3rd) business day after deposit in the United States mail when delivery
is made by first class, registered or certified mail, and (iii) upon
transmission when made by telegram, telex or other facsimile transmission if
evidenced by a sender transmission completed confirmation.
Section 11.3 Severability. If any term, provision, covenant or
restriction contained in this Agreement is held by a court of competent
jurisdiction or other competent authority to be invalid, void or unenforceable
or against public or regulatory policy, the remainder of the terms, provisions,
covenants and restrictions contained in this Agreement shall remain in full
force and effect and in no way shall be affected, impaired or invalidated, if,
but only if, pursuant to such remaining terms, provisions, covenants and
restrictions the Merger may be consummated in substantially the same manner as
set forth in this Agreement as of the later of the date this Agreement was
executed or last amended.
Section 11.4 Costs and Expenses. Expenses incurred by SBG on the
one hand and SouthTrust on the other hand, in connection with or related to the
authorization, preparation and execution of this Agreement, the solicitation of
shareholder approval and all other matters related to the closing of the
transactions contemplated hereby, including all fees and expenses of agents,
representatives, counsel and accountants employed by either such party or its
affiliates, shall be borne solely and entirely by the party which has incurred
same.
Section 11.5 Captions. The captions as to contents of particular
articles, sections or paragraphs contained in this Agreement and the table of
contents hereto are inserted only for convenience and are in no way to be
construed as part of this Agreement or as a limitation on the scope of the
particular articles, sections or paragraphs to which they refer.
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<PAGE> 43
Section 11.6 Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same document with the same force
and effect as though all parties had executed the same document.
Section 11.7 Governing Law. This Agreement is made and shall be
governed by and construed in accordance with the laws of the State of Georgia
without respect to its conflicts of laws principles.
Section 11.8 Persons Bound; No Assignment. This Agreement shall
be binding upon and shall inure to the benefit of the parties hereto and their
respective successors, distributees, and assigns, but notwithstanding the
foregoing, this Agreement may not be assigned by any party hereto unless the
prior written consent of the other parties is first obtained (other than by
ST-Sub to another affiliate of SouthTrust).
Section 11.9 Exhibits and Schedules. Each of the exhibits and
schedules attached hereto is an integral part of this Agreement and shall be
applicable as if set forth in full at the point in the Agreement where
reference to it is made.
Section 11.10 Waiver. The waiver by any party of the performance of
any agreement, covenant, condition or warranty contained herein shall not
invalidate this Agreement, nor shall it be considered a waiver of any other
agreement, covenant, condition or warranty contained in this Agreement. A
waiver by any party of the time for performing any act shall not be deemed a
waiver of the time for performing any other act or an act required to be
performed at a later time. The exercise of any remedy provided by law, equity
or otherwise and the provisions in this Agreement for any remedy shall not
exclude any other remedy unless it is expressly excluded. The waiver of any
provision of this Agreement must be signed by the party or parties against whom
enforcement of the waiver is sought. This Agreement and any exhibit,
memorandum or schedule hereto or delivered in connection herewith may be
amended only by a writing signed on behalf of each party hereto.
Section 11.11 Construction of Terms. Whenever used in this
Agreement, the singular number shall include the plural and the plural the
singular. Pronouns of one gender shall include all genders. Accounting terms
used and not otherwise defined in this Agreement have the meanings determined
by, and all calculations with respect to accounting or financial matters unless
otherwise provided for herein, shall be computed in accordance with generally
accepted accounting principles, consistently applied. References herein to
articles, sections, paragraphs, subparagraphs or the like shall refer to the
corresponding articles, sections, paragraphs, subparagraphs or the like of this
Agreement. The words "hereof", "herein", and terms of similar import shall
refer to this entire Agreement. Unless the context clearly requires otherwise,
the use of the terms "including", "included", "such as", or terms of similar
meaning, shall not be construed to imply the exclusion of any other particular
elements.
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<PAGE> 44
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed and delivered, and their respective seals hereunto affixed, by
their officers thereunto duly authorized, and have caused this Agreement to be
dated as of the date and year first above written.
[CORPORATE SEAL]
SOUTHERN BANK GROUP, INC.
By: /s/ LAMAR SEALS
-------------------------------
ATTEST Its Chief Executive Officer
/s/ O. LAWRENCE CANEN
- -------------------------------------------
Its Secretary
[CORPORATE SEAL]
SOUTHTRUST OF GEORGIA, INC.
By: /s/ F. W. MURRAY JR.
-------------------------------
ATTEST: Its President
/s/ A. D. BARNARD
- -------------------------------------------
Its Secretary
[CORPORATE SEAL]
SOUTHTRUST CORPORATION
By: /s/ F. W. MURRAY JR.
-------------------------------
ATTEST: Its Executive Vice President
/s/ A. D. BARNARD
- -------------------------------------------
Its Secretary
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<PAGE> 45
AGREEMENT AND PLAN OR MERGER
OF SOUTHTRUST OF GEORGIA, INC.
WITH SOUTHERN BANK GROUP, INC.
LIST OF SCHEDULES
--------------------------------------------------------
Disclosure Schedule 3.2
Disclosure Schedule 3.4
Disclosure Schedule 3.5
Disclosure Schedule 3.7
Disclosure Schedule 3.10
Disclosure Schedule 3.11
Disclosure Schedule 3.12(a)
Disclosure Schedule 3.12(g),
Disclosure Schedule 3.13(a)
Disclosure Schedule 3.14(a)
Disclosure Schedule 3.14(b)
Disclosure Schedule 3.14(d)
Disclosure Schedule 3.16
Disclosure Schedule 3.20
Disclosure Schedule 3.22
Disclosure Schedule 3.23
Disclosure Schedule 4.4
Disclosure Schedule 4.7
Disclosure Schedule 4.14,
Disclosure Schedule 5.1(b)(vi)(A)
Disclosure Schedule 5.1(b)(vi)(B)
Disclosure Schedule 5.15
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