<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1994
Commission file number 0-16633
THE JONES FINANCIAL COMPANIES, A LIMITED PARTNERSHIP
______________________________________________________________________
(Exact name of registrant as specified in its charter)
MISSOURI 43-1450818
______________________________________________________________________
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification
No.)
201 Progress Parkway
Maryland Heights, Missouri 63043
______________________________________________________________________
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (314) 851-2000
__________________
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
Exchange Act of 1934 during the preceding 12 months (or for such
shorter period that the registrant was required to file such reports,
and (2) has been subject to such filing requirements for the past 90
days.
YES X NO
____ ____
As of the filing date, there are no voting
securities held by non-affiliates of the Registrant.
<PAGE>
THE JONES FINANCIAL COMPANIES, A LIMITED PARTNERSHIP
INDEX
Page
Number
Part I.
FINANCIAL INFORMATION
Item 1.
Financial Statements
Consolidated Statement of Financial Condition ...........3
Consolidated Statement of Income .......................5
Consolidated Statement of Cash Flows ....................6
Consolidated Statement of Changes in Partnership Capital 7
Notes to Consolidated Financial Statements ..............8
Item 2.
Management's Discussion and Analysis of Financial
Condition and Results of Operations .....................9
Part II.OTHER INFORMATION
Item 1.Legal Proceedings.......................................13
Signatures ..............................................14
<PAGE>
THE JONES FINANCIAL COMPANIES, A LIMITED PARTNERSHIP
CONSOLIDATED STATEMENT OF FINANCIAL CONDITION
ASSETS
September 30, December 31,
(Amounts in thousands) 1994 1993
Cash and cash equivalents $ 32,677 $ 28,798
Receivable from:
Customers 501,418 464,760
Brokers or dealers and clearing
organization deposits 17,453 32,550
Securities owned, at market value:
Trading securities 90,160 60,371
Investment securities 137,102 73,575
Office equipment, property and
improvements, at cost, net of
accumulated depreciation and
amortization of $91,188 in 1994
and $81,974 in 1993 123,655 102,434
Other assets 41,963 37,990
__________ __________
$ 944,428 $ 800,478
========== ==========
The accompanying notes are an integral part of these financial
statements.
<PAGE>
THE JONES FINANCIAL COMPANIES, A LIMITED PARTNERSHIP
CONSOLIDATED STATEMENT OF FINANCIAL CONDITION
LIABILITIES AND PARTNERSHIP CAPITAL
September 30, December 31,
(Amounts in thousands) 1994 1993
Bank loans $ 230,000 $ 139,261
Payable to:
Customers 228,558 242,584
Brokers or dealers and clearing
organizations 9,003 8,092
Securities sold but not yet purchased,
at market value 15,442 17,766
Accounts payable and accrued expenses 43,709 37,419
Accrued compensation and employee
benefits 57,585 69,264
Long-term debt 42,920 33,317
__________ __________
627,217 547,703
Liabilities subordinated to claims
of general creditors 136,000 73,000
Partnership capital 181,211 179,775
__________ __________
$ 944,428 $ 800,478
========== ==========
The accompanying notes are an integral part of these financial
statements.
<PAGE>
THE JONES FINANCIAL COMPANIES, A LIMITED PARTNERSHIP
CONSOLIDATED STATEMENT OF INCOME
(Unaudited)
Three Months Ended Nine Months Ended
(Amounts in thousands, Sept 30, Sept 24, Sept 30, Sept 24,
except per unit information) 1994 1993 1994 1993
Revenues:
Commissions $ 84,911 $ 108,508 294,158 $ 313,206
Investment banking 9,129 11,627 26,811 34,568
Principal transactions 47,554 22,052 109,690 71,055
Interest and dividends 14,112 9,761 35,868 26,910
Other 8,078 7,747 24,792 20,232
_________ _________ _________ _________
163,784 159,695 491,319 465,971
_________ _________ _________ _________
Expenses:
Employee and partner
compensation and benefits 93,198 98,229 288,734 284,704
Floor brokerage and
clearance fees 1,396 1,405 4,300 4,678
Occupancy and equipment 18,730 15,045 52,211 43,634
Communications and data
processing 12,965 8,390 34,875 24,248
Interest 8,183 4,850 20,493 13,770
Payroll and other taxes 4,236 3,299 16,132 13,588
Other operating expenses 11,208 11,442 33,369 31,341
_________ _________ _________ _________
149,916 142,660 450,114 415,963
_________ _________ _________ _________
Net income $ 13,868 $ 17,035 $ 41,205 $ 50,008
======= ======= ======= =======
Net income allocated to:
Limited partners $ 2,065 $ 2,855 $ 6,187 $ 6,751
Subordinated limited partners 1,335 1,443 4,005 4,620
General partners 10,468 12,737 31,013 38,637
_______ _______ _______ _______
$ 13,868 $ 17,035 $ 41,205 $ 50,008
======= ======= ======= =======
Net income per weighted
average $1,000
equivalent partnership unit
outstanding:
Limited partners $ 32.84 $ 50.58 $ 97.55 $ 147.68
======= ======= ======= =======
Subordinated limited
partners $ 60.08 $ 85.18 $ 184.45 $ 274.74
======= ======= ======= =======
Weighted average $1,000
equivalent partnership units
outstanding:
Limited partners 62,889 56,442 63,422 45,718
======= ======= ======= =======
Subordinated limited
partners 22,226 16,936 21,712 16,818
======= ======= ======= =======
The accompanying notes are an integral part of these financial
statements.
<PAGE>
THE JONES FINANCIAL COMPANIES, A LIMITED PARTNERSHIP
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
Nine Months Ended
September 30, September 24,
(Amounts in thousands) 1994 1993
Cash Flows (Used) Provided by Operating
Activities:
Net income $ 41,205 $ 50,008
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization 14,237 11,453
(Increase) in net receivable from
customers (50,684) (52,757)
Decrease (increase) in net receivable
from/payable to brokers and dealers 16,008 (383)
(Increase) decrease in securities
owned, net (95,640) 21,631
(Decrease) increase in accounts
payable, accrued expenses and accrued
compensation (5,389) 10,597
Other, net (3,973) (558)
____________ ____________
Net cash (used) provided by operating
activities (84,236) 39,991
____________ ____________
Cash Flows (Used) by Investing Activities:
Purchase of equipment, property and
improvements (35,458) (25,168)
____________ ____________
Net cash (used) by investing activities (35,458) (25,168)
____________ ____________
Cash Flows Provided (Used) by Financing
Activities:
Issuance (repayment) of bank loans 90,739 (8,433)
Issuance of long-term debt 44,859 11,700
Repayment of long-term debt (35,256) (2,008)
Issuance of subordinated debt 92,000 -
Repayment of subordinated debt (29,000) (5,000)
Issuance of partnership interests 5,167 29,196
Redemption of partnership interests (1,967) (944)
Withdrawals and distributions from
partnership capital (42,969) (48,093)
____________ ____________
Net cash provided (used) by financing
activities 123,573 (23,582)
____________ ____________
Net increase (decrease) in cash and
cash equivalents 3,879 (8,759)
Cash and Cash Equivalents, beginning of
period 28,798 37,730
____________ ____________
Cash and Cash Equivalents, end of period $ 32,677 $ 28,971
============ ============
Interest payments for the periods were $17,650 and $13,417.
The accompanying notes are an integral part of these financial
statements.
<PAGE>
THE JONES FINANCIAL COMPANIES, A LIMITED PARTNERSHIP
CONSOLIDATED STATEMENT OF CHANGES IN PARTNERSHIP CAPITAL
NINE MONTHS ENDED SEPTEMBER 30, 1994, AND SEPTEMBER 24, 1993
(Unaudited)
Subordinated
Limited limited General
partnership partnership partnership
(Amounts in thousands) capital capital capital Total
Balance, December 31, 1992 $ 47,328 $ 14,716 $ 75,252 $ 137,296
Issuance of partnership
interests 24,763 4,433 - 29,196
Redemption of partnership
interests (944) - - (944)
Net income 6,751 4,620 38,637 50,008
Withdrawals and
distributions (9,463) (5,918) (32,712) (48,093)
________ ________ ________ ________
Balance, September 24, 1993$ 68,435 $ 17,851 $ 81,177 $ 167,463
======= ======== ======== ========
Balance, December 31, 1993 $ 71,222 $ 19,163 $ 89,390 $ 179,775
Issuance of partnership
interests - 5,167 - 5,167
Redemption of partnership
interests (1,529) (438) - (1,967)
Net income 6,187 4,005 31,013 41,205
Withdrawals and
distributions (9,893) (5,353) (27,723) (42,969)
________ ________ ________ _______
Balance, September 30, 1994$ 65,987 $ 22,544 $ 92,680 $ 181,211
======= ======== ======== ========
The accompanying notes are an integral part of these financial
statements.
<PAGE>
THE JONES FINANCIAL COMPANIES, A LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
BASIS OF PRESENTATION
The accompanying consolidated financial statements include the
accounts of The Jones Financial Companies, A Limited Partnership and
all wholly owned subsidiaries (The "Partnership"), including the
Partnership's principal subsidiary, Edward D. Jones & Co., L.P.,
("EDJ"), a registered broker/dealer.
The financial information included herein is unaudited. However,
in the opinion of management, such information includes all
adjustments, consisting solely of normal recurring accruals, which are
necessary for a fair presentation of the results of interim
operations.
Certain 1993 amounts have been reclassified to conform to 1994
financial statement presentation.
The results of operations for the three and nine months ended
September 30, 1994, are not necessarily indicative of the results to
be expected for the full year.
NET CAPITAL REQUIREMENTS
As a result of its activities as a registered broker/dealer, EDJ is
subject to the Net Capital requirements of the Securities and Exchange
Commission and the New York Stock Exchange. Under the alternative
method permitted by the rules, EDJ is required to maintain minimum Net
Capital of 2% of aggregate debit items arising from customer
transactions. The Net Capital rules also provide that EDJ may not
expand its business nor may partnership capital be withdrawn if
resulting Net Capital would be less than 5% of aggregate debit items.
At September 30, 1994, EDJ's Net Capital of $157.5 million was 32% of
aggregate debit items and its Net Capital in excess of the minimum
required was $147.7 million.
THE JONES FINANCIAL COMPANIES, A LIMITED PARTNERSHIP
MANAGEMENT'S FINANCIAL DISCUSSION
OPERATIONS
QUARTER ENDED SEPTEMBER 30, 1994, VERSUS
QUARTER ENDED SEPTEMBER 24, 1993
Revenue increased 3% ($4.1 million) to $163.8 million compared to
the quarter ended September 24, 1993. Expenses increased 5% ($7.3
million) to $149.9 million. As a result, net income decreased by $3.2
million to $13.9 million. These results were significantly influenced
by the Partnership's strategy of increasing the number of investment
representatives. The number of investment representatives increased
32% (805) to 3,323, and the number of branches increased to 3,240, a
29% increase over last year. The majority of new investment
representatives hired by the Partnership are beginners in the
industry. Successful investment representatives generally achieve
profitability after about 30 months. In the interim, the Partnership
incurs significant training, salary and support costs. Additionally,
the Partnership made significant increases in home office overhead to
support the larger salesforce. The Partnership intends to continue
aggressively expanding its sales force.
Revenues from products sales and fees were flat during the current
quarter compared to the third quarter of 1993. Increasing interest
rates coupled with equity prices at historically high levels
contributed to decreasing security sales measured on a per investment
representative basis. At the same time, product mix shifts from
mutual funds to fixed income securities yielded less revenue from the
dollars customers invested. These reductions in investment
representative productivity and the yield from dollars invested with
the firm were offset by the significant increase in the salesforce.
Overall, commission revenues decreased 22% ($26.3 million). Mutual
fund commissions declined 37% ($26.3 million) while listed and over-
the-counter (O-T-C) agency equity commission revenues decreased 3%
($.6 million). Annuity revenues increased 9% ($1.2 million) as
investors continued to take advantage of tax deferred investments.
Investment banking revenues decreased 21% ($2.5 million) to $9.1
million for the period. Certificate of deposit revenues increased
substantially 73% ($1.6 million). With volatility and increasing
yields, investors purchased CDs. Higher interest rates throughout the
quarter caused debt and equity origination revenues to decline 43%
($3.9 million).
Principal transaction revenues increased 116% ($25.5 million) to
$47.6 million for the period. All categories of fixed income
securities revenues increased with governments increasing 595% ($14.3
million), corporates increasing 90% ($3.3 million) and municipals
increasing 32% ($3.5 million). Collateralized Mortgage Obligations
(CMO's) sales increased 150% ($4.1 million). Higher interest rates
during the quarter attracted investors to fixed income securities.
Interest and dividend income increased 45% ($4.4 million) to $14.1
million primarily due to a 38% ($2.7 million) increase in margin
interest from higher margin balances and interest rates. Customer
margin borrowing increased $61.9 million during the past year to
$482.1 million. U.S. Government and agency interest income increased
41% ($.7 million) from larger investment security positions purchased
with subordinated debt proceeds.
Compensation costs decreased 5% ($5.0 million) compared to the same
period last year. Commissions increased due to increased revenues.
However, sales bonuses, sales incentives and profit sharing provisions
were lower due to lower profit margins and net income. Salaries and
wages earned by non-sales personnel were higher during the period due
to increases in personnel necessary to support the increased sales
force.
Of the Partnership's remaining expenses, the most significant
changes were seen in occupancy, equipment, communications and data
processing expenses in order to support an expanding number of branch
offices. Interest expense was higher due to increased subordinated
debt.
NINE MONTHS ENDED SEPTEMBER 30, 1994 VERSUS
NINE MONTHS ENDED SEPTEMBER 24, 1993
Revenue increased 5% ($25.3 million) to $491 million compared to
the nine months ended September 24, 1993. Expenses increased 8%
($34.2 million) to $450.1 million. As a result, net income decreased
by 18% ($8.8 million) to $41.2 million.
During 1994, interest rates rose, depressing bond prices, and
equity prices were at historically high levels. These factors
combined adversely impacting commission and investment banking
revenues. At the same time, the Partnership continues to aggressively
increase its salesforce which significantly increases expenses.
Commissions decreased 6% ($19.0 million). Mutual fund commissions
decreased 18% ($35.8 million). Listed and agency equity commissions
decreased 8% ($5.3 million). Insurance and annuity commissions
increased 39% ($18.4 million) as investors continued to take advantage
of tax deferred investments. Rising interest rates caused sales to
decrease in debt mutual funds.
Investment banking revenues decreased 22% ($7.8 million) to $26.8
million for the period. EDJ origination of debt and equity declined
73% ($6.2 million) and CMO revenues fell 93% ($5.8 million). Municipal
bond origination revenues remained flat at $6.6
million. Certificate of deposit revenues increased 71% ($4.5
million).
Principal transaction revenues increased 54% ($38.6 million) to
$109.7 million for the period. Corporate, municipal and government
bond principal revenues increased 44% ($5.1 million), 24% ($8.3
million) and 274% ($17.9 million), respectively. CMO principal
revenues increased 97% ($9.4 million). This increase was offset by a
30% ($1.3 million) decline in OTC stocks. Increased interest rates
attracted individual investors to fixed income products.
Interest and dividend income increased 33% ($9.0 million) to $35.9
million primarily due to a 37% ($7.4 million) increase in margin
interest due to increased customer margin borrowing and rising
interest rates.
Compensation costs increased 1% ($4.0 million) compared to the same
period last year. Commissions increased due to increased revenues.
However, sales bonuses, sales incentives and profit sharing provisions
were lower due to lower profit margins and net income. Salaries and
wages earned by non-sales personnel were also higher during the period
due to increases in personnel necessary to support the increased sales
force.
Of the Partnership's remaining expenses, the most significant
changes were seen in occupancy, equipment, communications and data
processing expenses in order to support an expanding branch network.
LIQUIDITY AND CAPITAL ADEQUACY
The Partnership's equity capital at September 30, 1994, was $181.2
million compared to $167.5 as of September 24, 1993. Subordinated
limited partnership capital increased $5.2 million due to capital
contributions. General partnership capital increased $11.5 million
due to retention of earnings.
The Partnership privately placed $92 million of subordinated debt
during the second quarter, replacing higher rate debt and increasing
subordinated debt overall. The proceeds were used to repay $29
million of existing subordinated debt. The balance was invested in
U.S. Government and agency securities which are pledged to banks as
collateral for short term bank loans.
At September 30, 1994, the Partnership had a $32.7 million balance
of cash and cash equivalents. Uncommitted lines of credit are in
place at ten banks aggregating $615 million, of which $385 million was
unused at September 30, 1994.
The Partnership believes the liquidity provided by existing cash
balances and borrowing arrangements will be sufficient to meet the
Partnership's capital and liquidity requirements.
CASH FLOWS
Cash and cash equivalents increased $3.9 million from December 31,
1993 to September 30, 1994. Cash flows provided were primarily from
net income, depreciation, decreases in net receivables to brokers and
dealers, issuance of bank loans, issuance of long-term debt,
subordinated debt, and partnership interests. Cash flows were
primarily used to fund loans to customers, purchase fixed assets,
purchase securities owned, reduce accounts payable and accrued
expenses and subordinated debt, and to fund withdrawals and
distributions.
There were no material changes in the partnership's overall
financial condition during the nine months ended September 30, 1994,
compared with the nine months ended September 24, 1993. The
Partnership's balance sheet is comprised primarily of cash and assets
readily convertible into cash. Securities inventories are carried at
market values and are readily marketable. Customer margin accounts
are collateralized by marketable securities. Other customer
receivables and receivables and payables with other broker/dealers
normally settle on a current basis. Liabilities, including amounts
payable to customers, checks and accounts payable and accrued expenses
are non-interest bearing sources of funds to the Partnership. These
liabilities, to the extent not utilized to finance assets, are
available to meet liquidity needs and provide funds for short term
investments, which favorably impacts profitability.
The Partnership's principal subsidiary, Edward D. Jones & Co.,
L.P., ("EDJ") as a securities broker/dealer, is subject to the
Securities and Exchange Commission regulations requiring EDJ to
maintain certain liquidity and capital standards. EDJ has been in
compliance with these regulations at all times.
THE JONES FINANCIAL COMPANIES, A LIMITED PARTNERSHIP
Item 1: Legal Proceedings
There have been no material changes in the legal proceedings
previously reported.
Item 5: Other Information
For purposes of complying with the amendments to the rules
governing Form S-8 under the Securities Act of 1933, the registrant
hereby undertakes as follows, which undertaking shall be incorporated
by reference into it, Registration Statement of Form S-8 (File No. 33-
35247):
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant, the registrant has been advised
that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and
is, therefor, unenforceable. In the event that claim for
indemnification against such liabilities (other than the payment by
the registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered,
the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Act and will be
governed by the final adjudication of such issue.
Item 6: Exhibits and Reports on Form 8-K
(a) Exhibits
Reference is made to the Exhibit Index contained hereinafter..
(b) Reports on Form 8-K
No reports were filed on Form 8-K for the quarter ended September
30, 1994.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934
the registrant has duly caused this report to be signed on its behalf
by the undersigned thereunto duly authorized.
THE JONES FINANCIAL COMPANIES, A LIMITED PARTNERSHIP
(Registrant)
Dated: November 11, 1994 /s/ John W. Bachmann
_____________________
John W. Bachmann
Managing Partner
Dated: November 11, 1994 /s/ Steven Novik
_____________________
Steven Novik
Principal Financial
Officer
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934
the registrant has duly caused this report to be signed on its behalf
by the undersigned thereunto duly authorized.
THE JONES FINANCIAL COMPANIES, A LIMITED PARTNERSHIP
(Registrant)
Dated: November 11, 1994
_____________________
John W. Bachmann
Managing Partner
Dated: November 11, 1994
_____________________
Steven Novik
Principal Financial
Officer
EXHIBIT INDEX
THE JONES FINANCIAL COMPANIES, A LIMITED PARTNERSHIP
For the quarter ended September 30, 1994
Exhibit No. Description Page
10.1 Agreement and Plan of Acquistion between The Jones
Financial Companies and Boone National Savings and
Loan Association, F.A.
BETWEEN
THE JONES FINANCIAL COMPANIES
AND
BOONE NATIONAL SAVINGS AND LOAN ASSOCIATION, F.A.
dated October 25, 1994
AGREEMENT AND PLAN OF ACQUISITION
TABLE OF CONTENTS
PAGE
ARTICLE I. DEFINITIONS 1
ARTICLE II. MERGER
2.1 The Merger 5
2.2 Closing; Effective Time 6
2.3 Execution of Plan of Merger 7
ARTICLE III. REPRESENTATIONS AND WARRANTIES OF BOONE
3.1 Capital Structure 7
3.2 Organization, Standing and Authority of Boone 7
3.3 Ownership of Boone Subsidiary 7
3.4 Organization, Standing and Authority of
Boone Subsidiary 8
3.5 Authorized and Effective Agreement 8
3.6 Securities Documents and Regulatory Reports 9
3.7 Financial Statements 10
3.8 Material Adverse and Other Changes 11
3.9 Environmental Matters 11
3.10 Allowance for Loan Losses and Real Estate Owned 12
3.11 Tax Matters 12
3.12 Legal Proceedings 15
3.13 Compliance with Laws 15
3.14 Deposit Insurance and Other Regulatory Matters 16
3.15 Certain Information 16
3.16 Employee Benefit Plans 17
3.17 Certain Contracts 20
3.18 Insurance 20
3.19 Loans, Real Estate Owned, Etc. 21
3.20 Properties 21
3.21 Labor 22
3.22 Transactions with Affiliated Persons
and Affiliates 22
3.23 Required Vote 22
3.24 Disclosures 22
ARTICLE IV. REPRESENTATIONS AND WARRANTIES
OF JONES
4.1 Organization, Standing and Authority of Jones 23
4.2 Interim 23
4.3 Authorized and Effective Agreement 24
4.4 Certain Information 25
4.5 Legal Proceedings 25
4.6 Regulatory Approvals 25
4.7 Financial Statements 26
4.8 Material Adverse Change 26
4.9 Funding 26
4.10 Disclosures 26
ARTICLE V. COVENANTS
5.1 Shareholder Meeting 27
5.2 Applications 27
5.3 Best Efforts 28
5.4 Investigation and Confidentiality 28
5.5 Press Releases 30
5.6 Forbearances of Boone 30
5.7 Current Information 33
5.8 Directors, Officers and Employees 33
5.9 Employee Benefit Plans 35
5.10 Indemnification 36
5.11 Disclosure Supplements 36
5.12 Dissenting Shares 36
5.13 Jones, Interim and Surviving Corporation 36
5.14 Failure to Fulfill Conditions 37
5.15 Legal Fees 37
ARTICLE VI. CONDITIONS PRECEDENT
6.1 Conditions Precedent - Jones and Boone 37
6.2 Conditions Precedent - Boone 38
6.3 Conditions Precedent - Jones 39
ARTICLE VII. TERMINATION, WAIVER AND AMENDMENT
7.1 Termination 41
7.2 Effect of Termination 43
7.3 Survival of Representations, Warranties
and Covenants 43
7.4 Waiver 43
7.5 Amendment or Supplement 44
ARTICLE VIII. MISCELLANEOUS
8.1 Expenses 44
8.2 Entire Agreement 44
8.3 Assignment 44
8.4 Notices 45
8.5 Interpretation 45
8.6 Counterparts 45
8.7 Governing Law 46
EXHIBIT A Plan of Merger
EXHIBIT B Stockholder Agreement
ANNEX I Opinion of Counsel
ANNEX II Opinion of Counsel
AGREEMENT AND PLAN OF ACQUISITION
Agreement and Plan of Acquisition ("Agreement"), dated as of
October 25, 1994, by and between The Jones Financial Companies, a
Missouri limited partnership ("Jones") and Boone National Savings
and Loan Association, F.A., a federally chartered stock savings
and loan association ("Boone").
W I T N E S S E T H:
WHEREAS, the parties hereto desire to provide for Jones's
acquisition of Boone on the terms and conditions herein
contained; and
WHEREAS, the parties desire to provide for certain
undertakings, conditions, representations, warranties and
covenants in connection with the transactions contemplated
hereby; and
WHEREAS, Jones will organize [Jones Interim Bank, F.A.]
("Interim") in connection with the application for regulatory
approval of the transactions contemplated hereby;
WHEREAS, simultaneously with the execution of this
Agreement, certain stockholders of Boone are entering into
Stockholder Agreements, in each case dated as of the date hereof;
NOW, THEREFORE, in consideration of the premises and of the
mutual covenants and agreements herein contained, the parties
hereto do hereby agree as follows:
ARTICLE I
DEFINITIONS
"Boone Common Stock" shall mean the common stock, par value
$1.00 per share, of Boone.
"Boone Financial Statements" shall mean (i) the consolidated
balance sheets (including related notes and schedules, if any) of
Boone as of December 31, 1993 and 1992 and the consolidated
statements of income, changes in stockholders' equity and cash
flows (including related notes and schedules, if any) of Boone
for each of the three years ended December 31, 1993, 1992 and
1991 as filed by Boone in its Securities Documents, (ii) the
consolidated balance sheets of Boone (including related notes and
schedules, if any) and the consolidated statements of income,
changes in stockholders' equity and cash flows (including related
notes and schedules, if any) of Boone included in the Securities
Documents filed by Boone with respect to the quarterly and annual
periods ended subsequent to December 31, 1993, and (iii) the
consolidated balance sheet (including related notes and
schedules, if any) of Boone as of July 31, 1994 used in the
determination of the Merger Consideration.
"Boone Stock Option Plan" shall mean the Boone National
Savings and Loan Association, F.A. 1990 Stock Option Plan.
"Boone Subsidiary" shall mean Boone National Financial
Services, Incorporated.
"Charter Amendment" shall mean the amendment to Section 8 of
the Federal Stock Charter of Boone to permit the acquisition of
beneficial ownership of more than 10% of the Boone Common Stock
by Jones.
"Code" shall mean the Internal Revenue Code of 1986, as
amended.
"Commission" shall mean the Securities and Exchange
Commission.
"DOJ" shall mean the Department of Justice.
"Effective Time" shall mean the date and time specified
pursuant to Section 2.2 hereof as the effective time of the
Merger.
"Environmental Claim" means any written notice from any
governmental authority or third party alleging potential
liability (including, without limitation, potential liability for
investigatory costs, cleanup costs, governmental response costs,
natural resources damages, property damages, personal injuries or
penalties) arising out of, based on, or resulting from the
presence, or release into the environment, of any Materials of
Environmental Concern.
"Environmental Laws" means any federal, state or local law,
statute, ordinance, rule, regulation, code, license, permit,
authorization, approval, consent, order, judgment, decree,
injunction or agreement with any governmental entity relating to
(1) the protection, preservation or restoration of the
environment (including, without limitation, air, water vapor,
surface water, groundwater, drinking water supply, surface soil,
subsurface soil, plant and animal life or any other natural
resource), and/or (2) the use, storage, recycling, treatment,
generation, transportation, processing, handling, labeling,
production, release or disposal of Materials of Environmental
Concern. The term Environmental Law includes without limitation
(1) the Comprehensive Environmental Response, Compensation and
Liability Act, as amended, 42 U.S.C. S9601, et seq; the Resource
Conservation and Recovery Act, as amended, 42 U.S.C. S6901, et
seq; the Clean Air Act, as amended, 42 U.S.C. S7401, et seq; the
Federal Water Pollution Control Act, as amended, 33 U.S.C. S1251,
et seq; the Toxic Substances Control Act, as amended, 15 U.S.C.
S2601, et seq; the Emergency Planning and Community Right to Know
Act, 42 U.S.C. S11001, et seq; the Safe Drinking Water Act, 42
U.S.C. S300f, et seq; and all comparable state and local laws,
and (2) any common law (including without limitation common law
that may impose strict liability) that may impose liability or
obligations for injuries or damages due to, or threatened as a
result of, the presence of or exposure to any Materials of
Environmental Concern.
"ERISA" shall mean the Employee Retirement Income Security
Act of 1974, as amended.
"Exchange Act" shall mean the Securities Exchange Act of
1934, as amended.
"Exchange Agent" shall have the meaning ascribed thereto in
the Plan of Merger.
"FDIA" shall mean the Federal Deposit Insurance Act.
"FDIC" shall mean the Federal Deposit Insurance Corporation,
or any successor thereto.
"FHLB" shall mean Federal Home Loan Bank.
"FRB" shall mean the Board of Governors of the Federal
Reserve System.
"FTC" shall mean the Federal Trade Commission.
"HOLA" shall mean the Home Owners' Loan Act.
"Jones Financial Statements" shall mean the consolidated
statements of financial condition (including related notes and
schedules, if any) of Jones as of December 31, 1993 and 1992 and
the consolidated statements of income, changes in partnership
capital and cash flows (including related notes and schedules, if
any) of Jones for each of the three years ended December 31, 1993
and the consolidated statements of financial condition (including
related notes and schedules, if any) of Jones and the
consolidated statements of income, changes in partnership capital
and cash flows (including related notes and schedules, if any) of
Jones with respect to the quarterly and annual periods subsequent
to December 31, 1993.
"Materials of Environmental Concern" means pollutants,
contaminants, wastes, toxic substances, petroleum and petroleum
products and any other materials regulated under Environmental
Laws.
"Merger" shall mean the merger of Interim with and into
Boone pursuant to the terms hereof and the Plan of Merger.
"Merger Consideration" shall mean $69.78 per share to be
received by the holders of each of the 115,041 outstanding shares
of Boone Common Stock pursuant to the Plan of Merger.
"OTS" shall mean the Office of Thrift Supervision of the
U.S. Department of the Treasury and its predecessor, the Federal
Home Loan Bank Board, or any successor thereto.
"Plan of Merger" shall mean the a plan of merger
substantially in the form of the Plan of Merger attached hereto
as Exhibit A.
"Previously Disclosed" shall mean disclosed (i) in a letter
dated the date hereof delivered from the disclosing party to the
other party specifically referring to this Agreement and
describing in reasonable detail the matters contained therein and
the section of this Agreement to which such matters pertain, or
(ii) a letter dated after the date hereof from the disclosing
party specifically referring to this Agreement and describing in
reasonable detail the matters contained therein and delivered by
the other party pursuant to Section 5.10 hereof.
"Proxy Statement" shall mean the proxy statement to be
delivered to shareholders of Boone in connection with the
solicitation of their approval of this Agreement, the Plan of
Merger and the transactions contemplated hereby and thereby, as
amended or supplemented, if amended or supplemented.
"Real Estate Owned" shall mean real estate acquired by
foreclosure or by deed-in-lieu of foreclosure, real estate in
judgment and subject to redemption and in-substance foreclosures
under generally accepted accounting principles.
"Rights" shall mean warrants, options, rights, convertible
securities and other arrangements or commitments which obligate
an entity to issue or dispose of any of its capital stock or
other ownership interests.
"Securities Act" shall mean the Securities Act of 1933, as
amended.
"Securities Documents" shall mean all reports, offering
circulars, proxy statements, registration statements and all
similar documents filed, or required to be filed, pursuant to the
Securities Laws.
"Securities Laws" shall mean the Securities Act, the
Exchange Act and the rules and regulations of the OTS and of the
Commission promulgated thereunder or in connection therewith.
"Subsidiaries" shall mean any corporation, bank, savings
association, partnership, joint venture or other organization
more than 25% of the stock or ownership interest of which is
owned, directly or indirectly, by an entity.
"Surviving Corporation" shall mean Boone as the surviving
corporation of the Merger.
Other terms used herein are defined in the preamble and
elsewhere in this Agreement.
ARTICLE II
MERGER
2.1 The Merger
Subject to the terms and conditions of this Agreement and
the Plan of Merger attached hereto as Exhibit A and incorporated
herein by reference, at the Effective Time (as defined in Section
2.2 hereof), Interim shall be merged with and into Boone (the
"Merger") in accordance with HOLA and the rules and regulations
promulgated thereunder, with Boone as the surviving corporation
(hereinafter sometimes called the "Surviving Corporation").
Subject to the terms and conditions of this Agreement and the
Plan of Merger, (i) each share of Boone Common Stock issued and
outstanding immediately prior to the Effective Time (other than
(x) shares held by Jones or any wholly-owned Subsidiary thereof,
with the exception of shares held in a fiduciary capacity or in
satisfaction of a debt previously contracted in good faith, and
(y) shares held by a holder who has made a demand for appraisal
and payment in accordance with 12 C.F.R. S552.14(c)(2) and who
has not voted for the Merger) shall, by virtue of the Merger and
without any further action by the holder thereof, be converted
into and represent the right to receive the Merger Consideration,
and (ii) each issued and outstanding share of Interim Common
Stock immediately prior to the Effective Time shall, by virtue of
the Merger and without any action on the part of the holder
thereof, be converted into and become one validly issued, fully
paid and nonassessable share of common stock of the Surviving
Corporation.
The Merger Consideration shall be paid to the shareholders
by the Exchange Agent by check, except that if a shareholder owns
1000 or more shares of Boone Common Stock, he or she may elect
(prior to the shareholder meeting described in Section 5.1
hereto) to receive, in lieu of a check for the aggregate Merger
Consideration due such holder, a check for one-quarter of the
aggregate Merger Consideration due such holder and an Installment
Note (as defined herein) in a form reasonably acceptable to Boone
for three-quarters of such amount ("Note Amount"), provided that
if the issuance thereof would require registration under the
Securities Act of 1933, as amended, the cost of such registration
(to a maximum of $1.00 per share owned by such holder) would be
deducted from the principal amount of such Installment Note. An
"Installment Note" (i) will be a promissory note of Jones in the
amount of the Note Amount, (ii) will be backed by an irrevocable
non-transferrable stand-by letter of credit issued by a bank
("Letter of Credit"), (iii) will accrue interest at annual rate
equal to the 18 month treasury bill rate at the Effective Time,
less 50 basis points (an amount equal to the Letter of Credit
fee) or, if higher, the lowest applicable short-term rate as
determined in S1274(d) of the Code at the Effective Time in
respect of the Installment Note, and (iv) will be payable in
three equal installments of principal on the first, second and
third yearly anniversary of the Effective Time, with interest on
the outstanding and unpaid principal for the previous year also
payable on such anniversary dates.
Prior to the Effective Time, Boone shall obtain a written,
executed Release and Waiver Agreement from each holder of an
outstanding option to purchase Boone Common Stock pursuant to the
Stock Option Plan, whether or not then vested or exercisable.
Pursuant to such Release and Waiver Agreement, the holder shall
agree to release any and all rights, claims or actions which he
may have with respect to the Stock Option Plan. As consideration
for execution of such release, Jones shall pay to the holder for
each such option an amount determined by multiplying (i) the
excess, if any, of the Merger Consideration over the applicable
exercise price per share of such option by (ii) the number of
shares of Boone Common Stock subject to such option.
2.2 Closing; Effective Time
A closing (the "Closing") shall take place at 10:00 a.m. on
a day within twenty (20) business days, as mutually agreed by the
parties, following the satisfaction or waiver, to the extent
permitted hereunder, of the conditions to the consummation of the
Merger specified in Article VI of this Agreement (other than the
delivery of certificates, opinions and other instruments and
documents to be delivered at the Closing), at the offices of
Bryan Cave, 211 North Broadway, St. Louis Missouri, or at such
other place, at such other time, or on such other date as the
parties may mutually agree upon. At the Closing, there shall be
delivered to Jones and Boone the opinions, certificates and other
documents required to be delivered under Article VI hereof. The
"Effective Time" shall be 5:00 p.m. on the date of Closing or as
otherwise specified by law, in accordance with the provisions of
HOLA and the rules and regulations thereunder.
2.3 Execution of Plan of Merger
Following the receipt of applicable regulatory approval and
at or prior to the Closing, Jones, Interim and Boone will enter
into the Plan of Merger.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF BOONE
Boone represents and warrants to Jones as follows:
3.1 Capital Structure
The authorized capital stock of Boone consists of 2,500,000
shares of Boone Common Stock and 1,000,000 shares of serial
preferred stock (the "Boone Preferred Stock"). As of the date
hereof, there are 115,041 shares of Boone Common Stock, and no
shares of Boone Preferred Stock, issued and outstanding and no
shares of Boone Common Stock and no shares of Boone Preferred
Stock are directly or indirectly held as treasury stock by Boone.
All outstanding shares of Boone Common Stock have been duly
authorized and validly issued and are fully paid and
nonassessable. Except for 10,229 shares of Boone Common Stock
issuable upon exercise of outstanding stock options granted
pursuant to the Boone Stock Option Plan as of the date hereof,
there are no Rights authorized, issued or outstanding with
respect to the capital stock of Boone. None of the shares of
Boone capital stock has been issued in violation of the
preemptive rights of any person, firm or entity. Of the
outstanding options, 9,229 are exercisable at $10.00 per share
and 1,000 at $32.99 per share.
3.2 Organization, Standing and Authority of Boone
Boone is a federally chartered stock savings and loan
association duly organized, validly existing and in good standing
under the laws of the United States with full corporate power and
authority to own or lease all of its properties and assets and to
carry on its business as now conducted and is duly licensed or
qualified to do business and is in good standing in each
jurisdiction in which its ownership or leasing of property or the
conduct of its business requires such licensing or qualification.
Boone has delivered to Jones true and complete copies of the
Charter and Bylaws of Boone as in effect as of the date hereof.
3.3 Ownership of Boone Subsidiary
Boone has no direct or indirect Subsidiary other than the
Boone Subsidiary, all of the capital stock of which is owned by
Boone, nor does it own directly or indirectly more than 10% and
less than 25% of the equity of any corporation, bank, savings
association, partnership, joint venture or other organization. A
brief summary of the activities conducted by the Boone Subsidiary
have been Previously Disclosed by Boone. Except as Previously
Disclosed and except for the Boone Subsidiary and securities and
other interests taken in consideration of debts previously
contracted, Boone does not own or have the right to acquire,
directly or indirectly, any outstanding capital stock or other
voting securities or ownership interests of any corporation,
bank, savings association, partnership, joint venture or other
organization. The outstanding shares of capital stock of the
Boone Subsidiary have been duly authorized and validly issued,
are fully paid and nonassessable, and are directly or indirectly
owned by Boone free and clear of all liens, claims, encumbrances,
charges, restrictions or rights of third parties of any kind
whatsoever. No Rights are authorized, issued or outstanding with
respect to the capital stock or other ownership interests of the
Boone Subsidiary and there are no agreements, understandings or
commitments relating to the right of Boone to vote or to dispose
of said shares or other ownership interests.
3.4 Organization, Standing and Authority of Boone Subsidiary
The Boone Subsidiary is a corporation duly organized,
validly existing and in good standing under the laws of the state
of Missouri. The Boone Subsidiary (i) has full power and
authority to own or lease all of its properties and assets and to
carry on its business as now conducted, and (ii) is duly licensed
or qualified to do business and is in good standing in each
jurisdiction in which its ownership or leasing of property or the
conduct of its business requires such qualification. Boone has
delivered to Jones true and complete copies of the Articles of
Incorporation and Bylaws of the Boone Subsidiary as in effect as
of the date hereof.
3.5 Authorized and Effective Agreement
(a) Boone has all requisite corporate power and authority
to enter into this Agreement and the Plan of Merger and (subject
to receipt of all necessary governmental approvals and the
approval of Boone's shareholders of this Agreement, the Plan of
Merger and the Charter Amendment) to perform all of its
obligations under this Agreement and the Plan of Merger. The
execution and delivery of this Agreement and the Plan of Merger
and the consummation of the transactions contemplated hereby and
thereby have been duly and validly authorized by all necessary
corporate action in respect thereof on the part of Boone, except
for the approval of this Agreement, the Plan of Merger and the
Charter Amendment by Boone's shareholders. Each of this
Agreement and the Plan of Merger has been duly and validly
executed and delivered by Boone and constitutes a legal, valid
and binding obligation of Boone which is enforceable against
Boone in accordance with its terms, subject, as to
enforceability, to receivership or conservatorship, insolvency
and other laws of general applicability relating to or affecting
creditors' rights and to general equity principles.
(b) Except for consents and approvals of, filings or
registrations with, notices to or non-objections by, as
applicable the OTS, the FDIC, the DOJ and the FTC and the
shareholders of Boone, no consents or approvals of, or filings or
registrations with, or notices to any public body or authority
are necessary on behalf of Boone in connection with (i) the
execution and delivery by Boone of this Agreement and the Plan of
Merger or (ii) the consummation by Boone of the transactions
contemplated hereby and thereby.
(c) Except as Previously Disclosed, neither the execution
and delivery of this Agreement and the Plan of Merger, nor
consummation of the transactions contemplated hereby and thereby
(including the Merger), nor compliance by Boone with any of the
provisions hereof or thereof (i) conflict with or result in a
breach of any provisions of the Charter or Bylaws of Boone or the
Boone Subsidiary, (ii) violate, conflict with or result in a
breach of any term, condition or provision of, or constitute a
default (or an event which, with notice or lapse of time, or
both, would constitute a default) under, or give rise to any
right of termination, cancellation or acceleration with respect
to, or result in the creation of any lien, charge or encumbrance
upon any property or asset of Boone pursuant to, any material
note, bond, mortgage, indenture, deed of trust, license, lease,
agreement or other instrument or obligation to which Boone or the
Boone Subsidiary is a party, or by which any of their respective
properties or assets may be bound or affected, or (iii) subject
to receipt of all required governmental approvals, violate any
order, writ, injunction, decree, statute, rule or regulation
applicable to Boone or the Boone Subsidiary.
3.6 Securities Documents and Regulatory Reports
(a) Boone has delivered to Jones a complete copy of all
Securities Documents filed by Boone pursuant to the Securities
Laws or mailed by Boone to its shareholders as a class since
January 1, 1993. Boone has timely filed with the OTS all
Securities Documents required by the Securities Laws and such
Securities Documents complied in all material respect with the
Securities Laws and did not contain any untrue statement of a
material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements
therein, at the time and in light of the circumstances under
which they were made, not misleading, provided that information
as of a later date shall be deemed to modify information as of an
earlier date.
(b) Since January 1, 1992, except as Previously Disclosed
(none of which exceptions are material), Boone has duly filed
with the OTS and the FDIC in correct form the reports required to
be filed under applicable laws and regulations and such reports
were in all material respects complete and accurate and in
compliance with the requirements of applicable laws and
regulations, provided that information as of a later date shall
be deemed to modify information as of an earlier date; and Boone
has previously delivered or made available to Jones accurate and
complete copies of all such reports. In connection with the most
recent examinations of Boone by the OTS and the FDIC, Boone was
not required to correct or change any action, procedure or
proceeding which Boone believes in good faith has not been now
corrected or changed as required.
3.7 Financial Statements
(a) Boone has delivered to Jones accurate and complete
copies of the Boone Financial Statements which, in the case of
the consolidated balance sheets of Boone as of December 31, 1993
and 1992 and the consolidated statements of income, changes in
stockholders' equity and cash flows of Boone for each of the
three years ended December 31, 1993, 1992 and 1991, are
accompanied by the audit reports of Baird, Kurtz & Dobson,
independent public accountants with respect to Boone. The Boone
Financial Statements as well as the financial statements of Boone
to be delivered pursuant to Section 5.7 hereof, fairly present or
will fairly present, in all material respects, as the case may
be, the consolidated financial condition of Boone as of the
respective dates set forth therein, and the consolidated results
of operations, shareholders' equity and cash flows of Boone for
the respective periods or as of the respective dates set forth
therein subject, in the case of interim financial statements, to
the adjustments which have been Previously Disclosed, all of
which are normal recurring year-end adjustments and none of which
are material, and the absence of notes thereto.
(b) Each of the financial statements referred to in Section
3.7(a) has been or will be, as the case may be, prepared in
accordance with generally accepted accounting principles
consistently applied during the periods involved, except as
stated therein subject, in the case of interim financial
statements, to the adjustments which have been Previously
Disclosed, all of which are normal recurring year-end adjustments
and none of which are material, and the absence of notes thereto.
The consolidated audits of Boone have been conducted in
accordance with generally accepted auditing standards. The books
and records of Boone and the Boone Subsidiary are being
maintained in material compliance with applicable legal and
accounting requirements, and such books and records accurately
reflect in all material respects all dealings and transactions in
respect of the business, assets, liabilities and affairs of Boone
and the Boone Subsidiary.
(c) Except and to the extent (i) reflected, disclosed or
provided for in the consolidated statement of financial condition
of Boone as of July 31, 1994 (including related notes) and
(ii) of liabilities incurred since July 31, 1994 in the ordinary
course of business, neither Boone nor the Boone Subsidiary has
any liabilities, whether absolute, accrued, contingent or
otherwise, material to the financial condition, results of
operations, business or prospects of Boone on a consolidated
basis.
3.8 Material Adverse and Other Changes
To the date hereof, there has not occurred any material
adverse change in Boone's consolidated financial condition,
results of operations, business or prospects since July 31, 1994.
Except as Previously Disclosed, neither Boone nor the Boone
Subsidiary has taken any action subsequent to July 31, 1994 which
if taken after the date hereof would violate the provisions of
Section 5.6 hereof.
3.9 Environmental Matters
(a) To the best of their knowledge and except as Previously
Disclosed, Boone and the Boone Subsidiary are in compliance with
all Environmental Laws, except for any violations of any
Environmental Laws which would not singly or in the aggregate,
have a material adverse effect on the financial condition,
results of operations, business or prospects of Boone on a
consolidated basis. Neither Boone nor the Boone Subsidiary has
received any communication alleging that Boone or the Boone
Subsidiary is not in such compliance and, to the best knowledge
of Boone or except as Previously Disclosed, there are no present
circumstances that would prevent or interfere with the
continuation of such compliance.
(b) To the best of their knowledge and except as Previously
Disclosed, none of the properties owned, leased or operated by
Boone or the Boone Subsidiary has been or is in violation of or
liable under any Environmental Law, except for any violations of
any Environmental Laws which would not singly or in the
aggregate, have a material adverse effect on the financial
condition, results of operations, business or prospects of Boone
on a consolidated basis. To the best of their knowledge and
except as Previously Disclosed, there has been no disposal or
release of any Materials of Environmental Concern on, under or
from such properties.
(c) Except as Previously Disclosed, there are no past or
present actions, activities, circumstances, conditions, events or
incidents that, to the best of their knowledge of Boone and the
Boone Subsidiary, could reasonably form the basis of any
Environmental Claim or other claim or action or governmental
investigation that could result in the imposition of any
liability arising under any Environmental Law against Boone or
the Boone Subsidiary or against any person or entity whose
liability for any Environmental Claim Boone or the Boone
Subsidiary has or may have retained or assumed either
contractually or by operation of law.
(d) Boone has Previously Disclosed any environmental
studies conducted by it or the Boone Subsidiary during the past
five years with respect to any properties owned, leased or
operated by it as of the date hereof.
(e) To the best knowledge of Boone and except as Previously
Disclosed, there have been no Materials of Environmental Concern
disposed or released on, under or from any real property which
Boone has a security interest in, nor is there any Environmental
Claim in connection with such properties.
3.10 Allowance for Loan Losses and Real Estate Owned
The allowance for loan losses reflected in the Boone
Financial Statements is, or will be in the case of subsequently
delivered Boone Financial Statements, as the case may be, in the
opinion of Boone's management adequate in all material respects
as of their respective dates under the requirements of generally
accepted accounting principles to provide for reasonably
anticipated losses on outstanding loans net of recoveries. Boone
has not become aware, or been advised by the examination staff of
the OTS or the FDIC, of the need to make additional specific
provisions for reserves or loan losses. The Real Estate Owned
reflected on the consolidated statements of financial condition
included in the Boone Financial Statements is, or will be in the
case of subsequently delivered Boone Financial Statements, as the
case may be, carried at the lower of cost or fair value, less (or
with a valuation allowance for) estimated costs to sell, as
required by generally accepted accounting principles.
3.11 Tax Matters
(a) Except as Previously Disclosed, during the three
years prior hereto, Boone and the Boone Subsidiary have timely
filed or caused to be filed with the appropriate government
entity all tax returns and reports required to be filed,
including income, withholding, employment, and estimated tax and
informational returns ("Tax Returns") and no Tax Returns have
been amended. Except as Previously Disclosed, all Tax Returns
are true, correct, and complete in all material respects. To the
best knowledge of Boone, there are no grounds for assertion of
any understatement penalty under Section 6661 of the Code (prior
to repeal) or Section 6662 of the Code. All Tax Returns for any
taxable period up to and including the Effective Time not due at
the Effective Time have been Previously Disclosed.
(b) All Taxes (whether or not reflected in Tax Returns
as filed) payable by Boone or the Boone Subsidiary with respect
to all periods reflected on Tax Returns have been timely and
fully paid (except for Taxes Previously Disclosed not yet due or
which have been contested in good faith, or where the failure to
timely file would not have a material adverse effect on the
financial condition, results of operations, business or prospects
of Boone on a consolidated basis) and, to the best of their
knowledge, there are no grounds for the assertion or assessment
of any additional Taxes against Boone or the Boone Subsidiary or
their assets with respect to such periods. To the best of their
knowledge, the U.S. federal income Tax Returns of Boone or the
Boone Subsidiary have never been audited by the Internal Revenue
Service and, to the best of their knowledge, there are no audits
of any Tax Returns pending or threatened. There is no waiver of
any statute of limitations in effect with respect to any Tax
Returns.
(c) The consolidated balance sheet of Boone at July
31, 1994, used in the determination of the Merger Consideration,
provides an adequate reserve for all Taxes due or to become due
up to and including such date, whether or not a Tax Return has
been filed for such period, except for Taxes which in the
aggregate are not material.
(d) Copies of all U.S. federal income Tax Returns, tax
examination reports and statements of deficiencies assessed
against, or agreed to with respect to Boone or the Boone
Subsidiary with respect to the last three (3) years have been
delivered to Buyer.
(e) Boone and the Boone Subsidiary are not and never
have been members of an "affiliated group" within the meaning of
Section 1504 of the Code, other than the affiliated group of
which Boone is the common parent. No other corporations have
been members of such affiliated group.
(f) To the best of their knowledge, Boone and the
Boone Subsidiary have complied with all laws relating to the
withholding of Taxes and the payment thereof (including, without
limitation, withholding of Taxes under Section 1441 and 1442 of
the Code, or any similar provision under foreign laws), and have
timely and properly withheld from employee wages and paid over to
the proper government all amounts required to be withheld and
paid over under applicable law.
(g) Neither Boone nor the Boone Subsidiary are a party
to any safe harbor lease within the meaning of
section 168(f)(8)of the Code, as in effect prior to amendment by
the Tax Equity and Fiscal Responsibility Act of 1982. None of
the assets of Boone or the Boone Subsidiary have been financed
with or directly or indirectly secures any industrial revenue
bonds or debt the interest on which is tax-exempt under Section
103(a) of the Code. Neither Boone nor the Boone Subsidiary is a
borrower or guarantor of any outstanding industrial revenue
bonds, and are not a tenant, principal user or related person to
any principal user (within the meaning of section 144(a) of the
Code) of any property which has been financed or improved with
the proceeds of any industrial revenue bonds.
(h) Boone is not a United States Real Property Holding
Company within the meaning of section 897(c) of the Code and
Treasury Regulations thereunder.
(i) Except as Previously Disclosed, neither Boone nor
the Boone Subsidiary are required to include in income any
adjustment under Section 481(a) of the Code by reason of a change
in accounting method initiated by Boone or the Boone Subsidiary
and the Internal Revenue Service has not proposed any such
adjustment or change in accounting method. Neither Boone or the
Boone Subsidiary has pending any private letter ruling with the
Internal Revenue Service.
(j) None of the property owned by Boone or the Boone
Subsidiary is tax-exempt use property within the meaning of
section 168(h) of the Code.
(k) No consent has been filed relating to Boone or the
Boone Subsidiary pursuant to section 341(f) of the Code.
(l) As of the Effective Time, neither Boone or the
Boone Subsidiary is a partner in any joint venture, partnership
or other arrangement or contract that could be treated as a
partnership for federal income tax purposes.
(m) Neither Boone nor the Boone Subsidiary is a party
to or bound by any tax allocation agreement, tax sharing
agreement or tax indemnification agreement.
(n) Neither Boone nor the Boone Subsidiary has any
material income reportable for a period ending after the
Effective Time attributable to a period ending at or prior to the
Effective Time (including any deferred intercompany
transactions).
(o) Except as Previously Disclosed, neither Boone nor
the Boone Subsidiary has any unused net operating loss, unused
net capital loss, unused credit, unused foreign tax credit, or
excess charitable contribution for federal income tax purposes as
of the Effective Time.
As used in this Agreement, "Taxes" means all taxes,
charges, fees, levies, or other like assessments, including
without limitation income, gross receipts, ad valorem, value
added, premium, excise, real property, personal property,
windfall profit, sales, use, transfer, license, withholding,
employment, payroll, bank, and franchise taxes imposed by: the
United States or any other nation, state, or bilateral or
multilateral governmental authority, any local governmental unit
or subdivision thereof, or any branch, agency, or judicial body
thereof; and shall include any interest, fines, penalties,
assessments, or additions to tax resulting from, attributable to,
or incurred in connection with any such Taxes or any contest or
dispute thereof.
3.12 Legal Proceedings
There are no actions, suits, claims, governmental
investigations or proceedings instituted, pending or, to the best
knowledge of Boone or the Boone Subsidiary, threatened (or
unasserted but considered by Boone probable of assertion and
which if asserted would have at least a reasonable probability of
a materially unfavorable outcome) against Boone or the Boone
Subsidiary or against any asset, interest or right of Boone or
the Boone Subsidiary, or against any officer, director or
employee in such capacity that in any such case, if decided
adversely, could have a material adverse effect on the financial
condition, results of operations, business or prospects of Boone
on a consolidated basis. Neither Boone nor the Boone Subsidiary
is a party to any order, judgment or decree which has or could
have a material adverse effect on the financial condition,
results of operations, business or prospects of Boone on a
consolidated basis.
3.13 Compliance with Laws
(a) Each of Boone and the Boone Subsidiary has all permits,
licenses, certificates of authority, orders and approvals of, and
has made all filings, applications and registrations with,
federal, state, local and foreign governmental or regulatory
bodies that are necessary in order to permit it to carry on its
business as it is presently being conducted and the absence of
which could have a material adverse effect on the financial
condition, results of operations, business or prospects of Boone
on a consolidated basis; all such permits, licenses, certificates
of authority, orders and approvals are in full force and effect;
and to the best knowledge of Boone, no suspension or cancellation
of any of the same is threatened.
(b) Neither Boone nor the Boone Subsidiary currently is in
material violation of its respective Charter, Articles of
Incorporation or other chartering instrument or Bylaws, or of any
applicable federal, state or local law or ordinance or any order,
rule or regulation of any federal, state, local or other
governmental agency or body (including, without limitation, all
banking, securities, municipal securities, safety, health,
environmental, zoning, anti-discrimination, antitrust, and wage
and hour laws, ordinances, orders, rules and regulations)
(collectively "Laws"), or in default with respect to any order,
writ, injunction or decree of any court, or in default under any
order, license, regulation or demand of any governmental agency;
and except as Previously Disclosed, during the five years prior
to the date of this Agreement, neither Boone nor the Boone
Subsidiary has received any notice or communication from any
federal, state or local governmental authority asserting that
Boone or the Boone Subsidiary is in violation of any of the
foregoing. Neither Boone nor the Boone Subsidiary is subject to
any regulatory or supervisory cease and desist order, agreement,
written directive, memorandum of understanding or written
commitment (other than those of general applicability to all
savings associations issued by governmental authorities), and
except as Previously Disclosed, during the five years prior to
the date of this Agreement, neither of them has received any
written communication requesting that they enter into any of the
foregoing.
3.14 Deposit Insurance and Other Regulatory Matters
(a) The deposit accounts of Boone are insured by the
Savings Association Insurance Fund administered by the FDIC to
the maximum extent permitted by the FDIA, and Boone has paid all
premiums and assessments required by the FDIA and the regulations
thereunder.
(b) Boone is a member in good standing of the FHLB of Des
Moines and owns the requisite amount of stock in the FHLB of Des
Moines.
(c) Boone is a "qualified thrift lender," as such term is
defined in the HOLA and the regulations thereunder.
3.15 Certain Information
The Proxy Statement, as of the date(s) such Proxy Statement
is mailed to shareholders of Boone and up to and including the
date(s) of the meeting of shareholders to which such Proxy
Statement relates, will not contain any untrue statement of a
material fact or omit to state a material fact necessary to make
the statements therein, in light of the circumstances under which
they were made, not misleading, provided that information as of a
later date shall be deemed to modify information as of an earlier
date and provided further that this representation and warranty
shall not apply to statements or omissions made in reliance upon
and in conformity with information furnished in writing to Boone
by or on behalf of Jones or any Jones Subsidiary relating to
Jones ("Jones Information") or to information required to be
included in the Proxy Statement pursuant to Rule 14a-8 under the
Exchange Act. The Proxy Statement will comply as to form in all
material respects with the Exchange Act and the rules and
regulations promulgated thereunder.
3.16 Employee Benefit Plans
(a) Boone has Previously Disclosed all stock option,
employee stock purchase and stock bonus plans, qualified pension
or profit-sharing plans, any deferred compensation, bonus or
group insurance contract, any plan or policy providing for
"fringe benefits" to its employees (including but not limited to,
vacation, disability, sick leave, medical, hospitalization, life
insurance and other insurance plans and related benefits), any
employment agreement and any other incentive, welfare or employee
benefit plan or agreement maintained for the benefit of
directors, former directors, employees or former employees of
Boone or the Boone Subsidiary, and Boone has furnished to Jones
accurate and complete copies of the same together with (i) the
most recent actuarial and financial reports prepared with respect
to any qualified plans, (ii) the most recent annual reports filed
with any governmental agency, and (iii) all rulings and
determination letters and any open requests for rulings or
letters that pertain to any qualified plan, and (iv) general
notification to employees of their rights under Code Section
4980B and form of letter(s) distributed upon the occurrence of a
qualifying event described in Code Section 4980B, in the case of
a Plan that is a "group health plan" as defined in Code Section
162(i). There are no negotiations, demands or proposals which
are pending or have been made which concern matters now covered,
or that would be covered, by the employee benefit plans.
(b) None of Boone, the Boone Subsidiary, any pension plan
maintained by any of them and qualified under Section 401 of the
Code or, to the best of Boone's knowledge, any fiduciary of such
plan has incurred any material liability to the Pension Benefit
Guaranty Corporation (the "PBGC") or the Internal Revenue Service
with respect to any employees of Boone or the Boone Subsidiary,
except liabilities to the PBGC pursuant to Section 4007 of ERISA,
all of which have been fully paid. To the best of Boone's
knowledge, no reportable event, except reportable events for
which the 30-day notice requirement has been waived by PBGC
Regulation 2615, under Section 4043(b) of ERISA has occurred with
respect to any such pension plan.
(c) Neither Boone nor the Boone Subsidiary (i) participates
in or has ever participated in a multi-employer plan (as such
term is defined in ERISA), (ii) has been a member of a controlled
group which contributed to a multi-employer plan, or (iii) has
been under common control with an employer which contributed to a
multi-employer plan.
(d) A favorable determination letter has been issued by the
Internal Revenue Service with respect to each "employee pension
plan" (as defined in Section 3(2) of ERISA) of Boone or the Boone
Subsidiary which is intended to qualify under Section 401 of the
Code to the effect that such plan is qualified under Section 401
of the Code and the trust associated with such employee pension
plan is tax exempt under Section 501 of the Code. No such letter
has been revoked or, to the best of Boone's knowledge, is
threatened to be revoked and Boone does not know of any ground on
which such a revocation could be based. Neither Boone nor the
Boone Subsidiary has any material liability under any such plan
that is not reflected on the consolidated statement of financial
condition of Boone at June 30, 1994 included in the Boone
Financial Statements, other than liabilities incurred in the
ordinary course of business in connection therewith subsequent to
the date thereof.
(e) To the best of Boone's knowledge, no prohibited
transaction (which shall mean any transaction prohibited by
Section 406 of ERISA and not exempt under Section 408 of ERISA or
Section 4975 of the Code) has occurred with respect to any
employee benefit plan maintained by Boone or the Boone
Subsidiary, which would result in the imposition directly or
indirectly, of a material excise tax under Section 4975 of the
Code or otherwise have a material adverse effect on the financial
condition, results of operations, business or prospects of Boone
on a consolidated basis.
(f) Neither Boone nor the Boone Subsidiary maintains any
defined benefit plans or other plans subject to Section 412 of
the Code or Title IV of ERISA.
(g) Each employee benefit plan of Boone and the Boone
Subsidiary complies and, to the best of their knowledge, has
been operated in compliance in all material respects with the
applicable provisions of ERISA, the Code, all regulations,
rulings and announcements promulgated or issued thereunder and
all other applicable governmental laws and regulations.
(h) There are no pending or, to the best knowledge of
Boone, threatened or anticipated claims, actions, proceedings or
investigations or facts which would give rise to claims, actions
proceedings or investigations (other than routine claims for
benefits) by, on behalf of or against any of the employee benefit
plans maintained by Boone and the Boone Subsidiary or any trust
related thereto or any fiduciary thereof.
(i) Except as Previously Disclosed, all required reports
and descriptions of each employee benefit plan (including IRS
Form 5500 Annual Reports, Summary Annual Reports and Summary Plan
Descriptions) have been timely filed and distributed.
(j) To the best of Boone's knowledge, any notices required
by ERISA or the Code or any other state or federal law or any
ruling or regulation of any state or federal administrative
agency with respect to each employee benefit plan have been
appropriately given.
(k) All contributions for all periods ending prior to the
Effective Time (including periods from the first day of the
current plan year to the Effective Time) will be made prior to
the Effective Time by Boone and all members of the controlled
group in accordance with past practice and the recommended
contribution in the applicable actuarial report.
(l) All insurance premiums (including premiums to the PBGC)
have been paid in full, subject only to normal retrospective
adjustments in the ordinary course, with regard to the Plans for
policy years or other applicable policy periods ending on or
before the Effective Time.
(m) To the best of Boone's knowledge, all of the employee
benefit plans, to the extent applicable, are in compliance with
Section 1862(b)(4)(A)(i) of the Social Security Act and Boone
does not have any liability for any excise tax imposed by Code
Section 5000.
(n) With respect to any employee benefit plan which is an
employee welfare benefit plan (within the meaning of ERISA
Section 3(1)) (a "Welfare Plan") and to the best of Boone's
knowledge: (i) each such Welfare Plan which is intended to meet
the requirements for tax-favored treatment under Subchapter B of
Chapter 1 of the Code meets such requirements; (ii) there is no
disqualified benefit (as such term is defined in Code Section
4976(b)) which would subject Boone or Jones to a tax under Code
Section 4976(a); (iii) each and every such Welfare Plan which is
a group health plan (as such term is defined in Code Section
162(i)(3)) complies and in each and every case has complied with
the applicable requirements of Code Section 4980B, Title XXII of
the Public Health Service Act and the applicable provisions of
the Social Security Act; and (iv) each such Welfare Plan
(including any such plan covering former employees of Boone or
the Boone Subsidiary) may be amended or terminated by Boone.
(o) No employee benefit plan sponsored by Boone or the
Boone subsidiary provides post-employment welfare benefits.
(p) All expenses and liabilities relating to all of the
plans have been, and will on the Effective Time be fully and
properly accrued on Boone's books and records and Boone's
financial statements reflect all of such liabilities in a manner
satisfying the requirements of Financial Accounting Standards 87
and 88.
3.17 Certain Contracts
(a) Except as Previously Disclosed, neither Boone nor the
Boone Subsidiary is a party to, is bound or affected by, or is
obligated to pay, benefits under (i) any agreement, arrangement
or commitment, including without limitation any agreement,
indenture or other instrument, relating to the borrowing of money
by Boone or the Boone Subsidiary or the guarantee by Boone or the
Boone Subsidiary of any obligation, other than agreements,
arrangements, commitments or guarantees entered into in the
ordinary course of its business consistent with past practice as
a federal savings and loan association, (ii) any agreement,
arrangement or commitment relating to the employment of a
consultant, advisor, broker or finder or the employment, election
or retention in office of any present or former director or
officer of Boone or the Boone Subsidiary, (iii) any agreement,
arrangement or understanding pursuant to which any payment
(whether of severance pay or otherwise) became or may become due
to any director, officer, employee, advisor or consultant of
Boone or the Boone Subsidiary upon execution of this Agreement or
upon or following consummation of the transactions contemplated
by this Agreement (either alone or in connection with the
occurrence of any additional acts or events), (iv) any agreement,
arrangement or understanding to which Boone or the Boone
Subsidiary is a party or by which any of the same is bound which
limits the freedom of Boone or the Boone Subsidiary to compete in
any line of business or with any person, or (v) any other
agreement, arrangement or understanding which would be required
to be filed as an exhibit to Boone's Annual Report on Form 10-K
under the Securities Laws and which has not been so filed.
(b) Neither Boone nor the Boone Subsidiary is in default or
in non-compliance (which default or non-compliance would have a
material adverse effect on the financial condition, results of
operations, business or prospects of Boone on a consolidated
basis) under any contract, agreement, commitment, arrangement,
lease, insurance policy or other instrument to which it is a
party or by which its assets, business or operations may be bound
or affected, whether entered into in the ordinary course of
business or otherwise and whether written or oral, and there has
not occurred any event that with the lapse of time or the giving
of notice, or both, would constitute such a default or non-
compliance.
3.18 Insurance
Boone and the Boone Subsidiary is insured, and during each
of the past three calendar years has been insured, for reasonable
amounts with financially sound and reputable insurance companies
against such risks as companies engaged in a similar business
would, in accordance with good business practice, customarily be
insured and has maintained all insurance required by applicable
laws and regulations. Boone has Previously Disclosed to Jones a
list identifying all insurance policies maintained by it or the
Boone Subsidiary as of the date hereof.
3.19 Loans, Real Estate Owned, Etc.
(a) Each loan on the books and records of Boone or the
Boone Subsidiary, including unfunded portions of outstanding
lines of credit and loan commitments, was made and has been
serviced in all material respects in accordance with customary
lending standards in the ordinary course of business (except for
loans which in the aggregate are not material to the financial
condition, results of operations, business or prospects of Boone
on a consolidated basis), is evidenced in all material respects
by appropriate and sufficient documentation and, to the best
knowledge of Boone, constitutes the legal, valid and binding
obligation of the obligor named therein, subject to bankruptcy,
insolvency, fraudulent conveyance and other laws of general
applicability relating to or affecting creditor's rights and to
general equity principles.
(b) Boone, has Previously Disclosed to Jones as of July 31,
1994: (i) any loan or similar agreement under the terms of which
the obligor is 60 or more days delinquent in payment of principal
or interest or, to the best knowledge of Boone, in default of any
other provision thereof; (ii) each loan or similar agreement
which has been classified as "substandard," "doubtful" or "loss"
or designated "special mention" by Boone, a Boone Subsidiary or
an applicable regulatory authority; (iii) a listing of the Real
Estate Owned held by Boone and the Boone Subsidiary; and (iv)
unfunded commercial loan commitments and letters of credit of
Boone.
3.20 Properties
All real and personal property owned by Boone or the Boone
Subsidiary or presently used by either of them in their
respective business is in condition (ordinary wear and tear
excepted) sufficient to carry on the business of Boone and the
Boone Subsidiary in the ordinary course of business consistent
with their past practices. Boone and the Boone Subsidiary have
good and marketable title free and clear of all liens,
encumbrances, charges, defaults or equities (other than equities
of redemption under applicable foreclosure laws) to all of the
properties and assets, real and personal, reflected on the
consolidated statement of financial condition of Boone as of
June 30, 1994 included in the Boone Financial Statements or
acquired after such date, except (i) liens for current taxes not
yet due or payable (ii) pledges to secure deposits and other
liens incurred in the ordinary course of its banking business,
(iii) such imperfections of title, easements and encumbrances, if
any, as are not material in character, amount or extent and
(iv) as reflected on the consolidated statement of financial
condition of Boone as of June 30, 1994 included in the Boone
Financial Statements. All real and personal property which is
leased or licensed by Boone or the Boone Subsidiary is held
pursuant to leases or licenses which are valid and enforceable in
accordance with their respective terms and such leases will not
terminate or lapse prior to the Effective Time. Boone has
Previously Disclosed an accurate listing of each such lease or
license referred to in the immediately preceding sentence
pursuant to which Boone or the Boone Subsidiary acts as lessor or
lessee, including the expiration date and the terms of any
renewal options which relate to the same, as well as a listing of
each real property owned by Boone or the Boone Subsidiary and
used in the conduct of its business.
3.21 Labor
No work stoppage involving Boone or the Boone Subsidiary is
pending or, to the best knowledge of Boone, threatened. Neither
Boone nor the Boone Subsidiary is involved in, or to the best
knowledge of Boone threatened with or affected by, any labor
dispute, arbitration, lawsuit or administrative proceeding
involving the employees of Boone or the Boone Subsidiary.
Employees of Boone and the Boone Subsidiary are not represented
by any labor union nor are any collective bargaining agreements
otherwise in effect with respect to such employees, and to the
best of Boone's knowledge, there have been no efforts to unionize
or organize any employees of Boone or the Boone Subsidiary during
the past five years.
3.22 Transactions with Affiliated Persons and Affiliates
Except as Previously Disclosed, no "affiliated person" or
"affiliate" of Boone, as defined in 12 C.F.R. S561.4 and 12
C.F.R. S561.5 has engaged in any transaction with Boone since
January 1, 1991 which was not in compliance with applicable laws
and regulations and as of the date hereof there is no loan or
extension of credit outstanding to any of the same.
3.23 Required Vote
The affirmative vote of the holders of two-thirds of the
issued and outstanding shares of Boone Common Stock is necessary
to approve this Agreement and the Plan of Merger and the
transactions contemplated hereby and thereby.
3.24 Disclosures
None of the representations and warranties of Boone in this
Agreement or the Plan of Merger or in any supplement or
certificate furnished pursuant to this Agreement or the Plan of
Merger, and, to the best knowledge of Boone, none of the other
information or documents furnished or to be furnished by Boone to
Jones in connection with this Agreement or the Plan or Merger or
the consummation of the transactions contemplated hereby and
thereby, is or will be false or misleading in any material
respect or contains or will contain any untrue statement of a
material fact, or omits or will omit to state any material fact
required to be stated or necessary to make any such information
or document, at the time and in light of the circumstances, not
misleading. Copies of all documents referred to in this
Article III are true, correct and complete copies thereof and
include all amendments, supplements and modifications thereto and
all waivers thereunder.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF JONES
Jones represents and warrants to Boone as follows:
4.1 Organization, Standing and Authority of Jones
Jones is a limited partnership duly organized, validly
existing and in good standing under the laws of the State of
Missouri with full partnership power and authority to own or
lease all of its properties and assets and to carry on its
business as now conducted and is duly licensed or qualified to do
business and is in good standing in each jurisdiction in which
its ownership or leasing of property or the conduct of its
business requires such licensing or qualification. Jones has
delivered to Boone a true and correct copy of its Partnership
Agreement.
4.2 Interim
(a) The outstanding shares of capital stock of Interim,
upon issuance, will be duly authorized and validly issued, will
be fully paid and nonassessable and will be directly or
indirectly owned by Jones free and clear of all liens, claims,
encumbrances, charges, restrictions or rights of third parties of
any kind whatsoever. No Rights are authorized, issued or
outstanding with respect to the capital stock or other ownership
interests of Interim and there are no agreements, understandings
or commitments relating to the right of Jones to vote or to
dispose of said shares or other ownership interests.
(b) At the Effective Time, Interim will be a federally
chartered stock savings and loan association duly organized,
validly existing and in good standing under the laws of the
United States. Jones will deliver to Boone true and complete
copies of the Charter and Bylaws of Interim.
(c) Interim will have all requisite corporate power and
authority to enter into the Plan of Merger and to perform all of
its obligations under the Plan of Merger. The execution and
delivery of the Plan of Merger and the consummation of the
transactions contemplated thereby will have been duly and validly
authorized by all necessary action in respect thereof on the part
of Interim. The Plan of Merger will be duly and validly executed
and delivered by Interim and will constitute a legal, valid and
binding obligation of Interim which is enforceable against
Interim, as applicable, in accordance with its terms, subject, as
to enforceability, to receivership or conservatorship, insolvency
and other laws of general applicability relating to or affecting
creditors' rights and to general equity principles.
(d) Except for consents and approvals of, filings or
registrations with, notices to or non-objections, as applicable,
by the OTS, no consents or approvals of, or filings or
registrations with, or notices to any public body or authority
are necessary on behalf of Interim in connection with (i) the
execution and delivery by Interim of the Plan of Merger, or (ii)
the consummation by Interim of the transactions contemplated
thereby.
(e) Other than the Plan of Merger, Interim will have no
agreements or obligations as of the Closing and will conduct no
business.
4.3 Authorized and Effective Agreement
(a) Jones has all requisite partnership power and authority
to enter into this Agreement and the Plan of Merger and to
perform all of its obligations under this Agreement. The
execution and delivery of this Agreement and the consummation of
the transactions contemplated hereby have been duly and validly
authorized by all necessary action in respect thereof on the part
of Jones. This Agreement has been duly and validly executed and
delivered by Jones and constitutes a legal, valid and binding
obligation of Jones which is enforceable against Jones in
accordance with its terms, subject, as to enforceability, to
bankruptcy, insolvency and other laws of general applicability
relating to or affecting creditors' rights and to general equity
principles.
(b) Except for consents and approvals of, filings or
registrations with, notices to or non-objections, as applicable,
by the OTS, the FDIC, the DOJ and the FTC no consents or
approvals of, or filings or registrations with, or notices to any
public body or authority are necessary on behalf of Jones in
connection with (i) the execution and delivery by Jones of this
Agreement or (ii) the consummation by Jones of the transactions
contemplated hereby.
(c) Neither the execution and delivery of this Agreement
nor consummation of the transactions contemplated hereby, nor
compliance by Jones with any of the provisions hereof or thereof
(i) conflict with or result in a breach of any provisions of the
Partnership Agreement of Jones, (ii) violate, conflict with or
result in a breach of any term, condition or provision of, or
constitute a default (or an event which, with notice or lapse of
time, or both, would constitute a default) under, or give rise to
any right of termination, cancellation or acceleration with
respect to, or result in the creation of any lien, charge or
encumbrance upon any property or asset of Jones pursuant to, any
material note, bond, mortgage, indenture, deed of trust, license,
lease, agreement or other instrument or obligation to which Jones
is a party, or by which any of its properties or assets may be
bound or affected, or (iii) subject to receipt of all required
governmental approvals, violate any order, writ, injunction,
decree, statute, rule or regulation applicable to Jones.
4.4 Certain Information
None of the information relating to Jones provided to Boone
in writing to be contained in the Proxy Statement, as of the
date(s) such Proxy Statement is mailed to shareholders of Boone
and up to and including the date(s) of the meeting of
shareholders to which such Proxy Statement relates, will contain
any untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in light
of the circumstances under which they were made, not misleading,
provided that information as of a later date shall be deemed to
modify information as of an earlier date.
4.5 Legal Proceedings
To the best knowledge of Jones there are no actions, suits,
claims, governmental investigations or proceedings instituted,
pending or threatened (or unasserted but considered by Jones
probable of assertion and which if asserted would have at least a
reasonable probability of a materially unfavorable outcome)
against Jones or any of its Subsidiaries which present a claim to
prohibit, restrict or make illegal consummation of the Merger or
any of the other transactions contemplated hereby.
4.6 Regulatory Approvals
Jones is not aware of any reasons why all consents,
approvals and non-objections, as applicable, of the transactions
contemplated hereby and the Plan of Merger from the FDIC and the
OTS and any other state or federal governmental agency,
department or body, the consent, approval or non-objection of
which is required for the consummation of the Merger shall not be
received or would be received subject to conditions that would so
materially adversely affect the business or economic benefits or
the transactions contemplated by this Agreement as to render
consummation of such transactions unduly burdensome. Jones is
not aware of any reason why all consents and approvals shall not
be procured from all other persons and entities whose consent or
approval shall be necessary for consummation of the transactions
contemplated by this Agreement.
4.7 Financial Statements
Jones has Previously Disclosed to Boone accurate and
complete copies of the Jones Financial Statements which in the
case of the consolidated statements of financial condition
(including related notes and schedules, if any) of Jones as of
December 31, 1993 and 1992 and the consolidated statements of
income, changes in partnership capital and cash flows (including
related notes and schedules, if any) of Jones for each of the
years ended December 31, 1993 are accompanied by the audit
opinion of Arthur Andersen & Co., independent public accountants
with respect to Jones. The Jones Financial Statements, as well
as any financial statements delivered pursuant to Section 5.7
hereof, fairly present or will fairly present, as the case may
be, the consolidated financial condition of Jones and its
Subsidiaries as of the dates indicated and the consolidated
income, changes in partnership capital and cash flows for the
periods then ended in accordance with generally accepted
accounting principles consistently applied.
4.8 Material Adverse Change
To the date hereof, there has not occurred any material
adverse change in Jones' consolidated financial condition,
results of operations, business or prospects since December 31,
1993 that would have a material adverse effect upon its ability
to consummate the transactions contemplated by this Agreement and
the Plan of Merger.
4.9 Funding
As of the date hereof, Jones has and, at the Effective Time,
will have the financial capability to pay for shares of Boone
Common Stock pursuant to the terms of Section 2.1 hereof and the
Plan of Merger.
4.10 Disclosures
None of the representations and warranties of Jones in this
Agreement or the Plan of Merger or in any supplement or
certificate furnished pursuant to this Agreement or the Plan of
Merger, and, to the best knowledge of Jones, none of the other
information or documents furnished or to be furnished by Jones to
Boone in connection with this Agreement or the Plan or Merger or
the consummation of the transactions contemplated hereby and
thereby, is or will be false or misleading in any material
respect or contains or will contain any untrue statement of a
material fact, or omits or will omit to state any material fact
required to be stated or necessary to make any such information
or document, at the time and in light of the circumstances, not
misleading. Copies of all documents referred to in this
Article IV are true, correct and complete copies thereof and
include all amendments, supplements and modifications thereto and
all waivers thereunder.
ARTICLE V
COVENANTS
5.1 Shareholder Meeting
Boone shall take all action necessary to have its
shareholders consider this Agreement and the Plan of Merger and
the transactions contemplated hereby and thereby, as soon as
practicable, at its next annual meeting of shareholders or at a
special meeting called for the purpose, including any adjournment
of either thereof to a date which would not require the
establishment of a new record date under the Bylaws of Boone.
Subject to actions taken by the Board of Directors pursuant to or
as a result of the parenthetical clause in Section 5.6(viii) and
the receipt of an opinion from RP Financial, Inc., dated the date
of the Proxy Statement and not withdrawn prior to the date of the
shareholder meeting, that the Merger Consideration is fair to
shareholders from a financial point of view, the Board of
Directors of Boone shall recommend that its shareholders approve
this Agreement and the Plan of Merger and the transactions
contemplated hereby and thereby and use its best efforts to
obtain, as promptly as practicable, such approval. Boone shall
cooperate and consult with Jones with respect to each of the
foregoing matters.
If the Board of Directors does not recommend the Merger, it
is understood and agreed that the approval prior to the date
hereof of this Agreement and the Plan of Merger by the Board of
Directors shall nonetheless be effective for purposes of any
statutory requirement for prior Board approval of the Merger.
5.2 Applications
Within 45 days of the date hereof, Jones shall prepare and
submit applications for prior approval of the transactions
contemplated hereby and in the Plan of Merger to the OTS, and any
other federal, state or local governmental agency, department or
body the approval or non-objection of which is required for
consummation of the transactions contemplated hereby and in the
Plan of Merger. Boone shall have the right to review and comment
on such applications that at least five business days prior to
Jones's filing thereof. Boone and Jones each represent and
warrant to the other that all information concerning it and its
directors, officers and shareholders and concerning its
Subsidiaries which has been made available to the other party for
inclusion in any such application shall be true, correct and
complete in all material respects.
Within 45 days of the date hereof, Boone shall prepare and
submit the Preliminary Proxy Statement for the shareholder
meeting described in Section 5.1 hereof to the OTS. Jones shall
have the right to review and comment on such Proxy Statement at
least five business days prior to Boone's filing thereof.
Within ten days after the OTS has indicated that it has no
additional comments to the preliminary form of the Proxy
Statement or documents incorporated by reference therein, (and if
the Proxy Statement shall not be subject to a stop order or
threatened stop order by the OTS or otherwise in violation of law
or regulation), Boone shall mail the Proxy Statement to its
shareholders.
5.3 Best Efforts
Jones and Boone shall each use its best efforts in good
faith, and cause its respective Subsidiaries to use their best
efforts in good faith, to (i) furnish such information as may be
required in connection with and otherwise cooperate in the
preparation and filing of the documents referred to in or
contemplated by Sections 5.1 and 5.2 hereof, and (ii) subject to
the terms and conditions set forth in this Agreement, and in the
case of Boone to actions taken by its Board of Directors pursuant
to or as a result of the parenthetical clause in Section
5.6(viii) hereof, take or cause to be taken all action necessary
or desirable on its part so as to permit consummation of the
Merger and the other transactions contemplated hereby at the
earliest possible date. Subject in the case of Boone to actions
taken by its Board of Directors pursuant to or as a result of the
parenthetical clause in Section 5.6(viii) hereof, neither Jones
nor Boone shall take, or cause or to the best of its ability
permit to be taken, any action that would substantially delay or
impair the prospects of completing the Merger and the other
transactions contemplated hereby.
5.4 Investigation and Confidentiality
(a) Boone shall permit Jones and its representatives
reasonable access during normal business hours to its properties
and personnel, and shall disclose and make available to Jones all
books, papers and records relating to the assets, stock
ownership, properties, operations, obligations and liabilities of
Boone and the Boone Subsidiary, including, but not limited to,
all books of account (including the general ledger), tax records,
minute books of meetings of boards of directors (and any
committees thereof) and shareholders, organizational documents,
bylaws, material contracts and agreements, filings with any
regulatory authority, accountants' work papers, litigation files,
loan files, plans affecting employees, and any other business
activities or prospects. In addition, Boone shall allow a
representative of Jones, strictly as an observer, to attend all
meetings of the Board of Directors of Boone and any committee
thereof, and shall give Jones reasonable notice of all such
meetings, other than a meeting or portion thereof, at which this
Agreement, or the transactions contemplated hereby, are
discussed, or any actions or proposed actions pursuant to or as a
result of the parenthetical clause in Section 5.6(viii) hereof.
Any information learned by Jones pursuant to the access and
disclosure described in the preceding paragraph shall not affect
the warranties and representations of Boone contained in this
Agreement. In the event that Boone is prohibited by law from
providing any of the access referred to in the preceding sentence
to Jones, it shall use its best efforts to obtain promptly
waivers thereof so as to permit such access or otherwise provide
access to such information. Boone shall make its directors,
officers, employees and agents and authorized representatives
(including counsel and independent public accountants) available
to confer with Jones and its representatives provided that
nothing herein shall be construed as a consent to the disclosure
of a privileged communication or a waiver of the attorney-client
privilege.
(b) All information furnished previously in connection with
the transactions contemplated by this Agreement or pursuant
hereto shall be treated as the sole property of the party
furnishing the information until consummation of the transactions
contemplated hereby and, if such transactions 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 not apply to (i) any
information which (x) the party receiving the information can
establish by convincing evidence was already in its possession
prior to the disclosure thereof by the party furnishing the
information; (y) was then generally known to the public; or (z)
became known 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, 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 business days prior
notice thereof.
5.5 Press Releases
Jones and Boone shall agree with each other as to the form
and substance of any press release related to this Agreement and
the Plan of Merger or the transactions contemplated hereby and
thereby, and consult with each other as to the form and substance
of other public disclosures which may relate to the transactions
contemplated by this Agreement, provided, however, that nothing
contained herein shall prohibit either party, following
notification to the other party, from making any disclosure which
it determines in good faith is required by law or regulation.
5.6 Forbearances of Boone
Except as expressly contemplated hereby, between the date
hereof and the Effective Time, Boone shall not, and shall cause
the Boone Subsidiary not to:
(i) carry on its business other than in the usual,
regular and ordinary course in substantially the same manner as
heretofore conducted, or establish or acquire any new subsidiary
or cause or permit any subsidiary to engage in any new activity
or materially expand any existing activities;
(ii) declare, set aside, make or pay any dividend or
other distribution (whether in cash, stock or property or any
combination thereof) in respect of the Boone Common Stock.
(iii) issue any shares of its capital stock other than
pursuant to any Rights which are outstanding as of the date
hereof (as set forth in Section 3.1 hereof);
(iv) issue, grant, modify or authorize any Rights
(including without limitation Rights pursuant to the Boone Stock
Option Plan) or effect any recapitalization, reclassification,
stock dividend, stock split or like change in capitalization;
(v) amend its Charter, Articles of Incorporation or
Bylaws or equivalent documents (other than with respect to the
Charter Amendment); impose, or suffer the imposition, on any
share of stock held by Boone in the Boone Subsidiary of any
material lien, charge or encumbrance or permit any such lien to
exist; or waive or release any material right or cancel or
comprise any material debt or claim;
(vi) increase the rate of compensation of any of its
directors, officers or employees, or pay or agree to pay any
bonus or severance to, or provide any other new employee benefit
or incentive to, any of its directors, officers or employees,
except such as may be granted in the ordinary course of business
consistent with past practice;
(vii) except as Previously Disclosed, enter into or
(except as may be required by applicable law or is advisable in
the written opinion of counsel to maintain the tax qualified
status of the plan) modify any pension, retirement, stock option,
stock purchase, stock appreciation right, savings, profit
sharing, deferred compensation, supplemental retirement,
consulting, bonus, group insurance or other employee benefit,
incentive or welfare contract, plan or arrangement, or any trust
agreement related thereto, in respect of any of its directors,
officers or employees; or make any contributions to any defined
contribution or defined benefit plan not in the ordinary course
of business consistent with past practice;
(viii) solicit or encourage inquiries or proposals
with respect to, furnish any information relating to, or
participate in any negotiations or discussions concerning, any
acquisition, lease or purchase of all or a substantial portion of
the assets of, or any equity interest in, Boone or the Boone
Subsidiary or any business combination with Boone or the Boone
Subsidiary other than as contemplated by this Agreement (except
where the failure to furnish such information or participate in
such negotiations or discussions would constitute a breach of the
fiduciary or legal obligations of Boone's Board of Directors,
based on the reasonable advice of counsel to Boone); or authorize
or permit any officer, director, agent or affiliate of it to do
any of the above; or fail to promptly (y) notify Jones if any
such inquiries or proposals are received by, and such information
is required from, or any such negotiations or discussions are
sought to be initiated with, Boone or the Boone Subsidiary and
(z) provide Jones with copies of all such written inquiries or
proposals and an accurate and complete written synopsis of all
such oral inquiries or proposals, and shall, prior to or
contemporaneous with providing the same to such other party,
deliver to Jones all information provided by Boone or its
representatives to such other party;
(ix) enter into (w) any agreement, arrangement or
commitment not made in the ordinary course of business, (x) any
agreement, indenture or other instrument relating to the
borrowing of money by Boone or the Boone Subsidiary or guarantee
by Boone or the Boone Subsidiary of any such obligation, except
for deposits, advances from the FHLB of Des Moines and
transactions in federal funds in the ordinary course of business
consistent with past practice, (y) any agreement, arrangement or
commitment relating to the employment of, or severance of, an
officer, employee or consultant or amend any such existing
agreement except in the ordinary course of business consistent
with past practice or as Previously Disclosed, or (z) any
contract, agreement or understanding with a labor union;
(x) change its method of accounting in effect for the
year ended December 31, 1993, except as required by changes in
laws or regulations or generally accepted accounting principles
concurred in by its independent certified public accountants, or
change any of its methods of reporting income and deductions for
federal income tax purposes from those employed in the
preparation of its federal income tax returns for the year ended
December 31, 1993, except as required by changes in laws or
regulations or IRS rulings thereunder;
(xi) purchase or otherwise acquire, or sell or
otherwise dispose of, any assets or voluntarily incur any
liabilities other than in the ordinary course of business
consistent with past practice and policies;
(xii) make any capital expenditures in excess of
$50,000 individually or $200,000 in the aggregate, other than
pursuant to binding commitments existing on the date hereof and
other than expenditures necessary to maintain existing assets in
good repair;
(xiii) file any applications or make any contract with
respect to branching or site location or relocation;
(xiv) acquire in any manner whatsoever (other than to
realize upon collateral for a defaulted loan) any business or
entity;
(xv) engage in any transaction with an "affiliated
person" or "affiliate," in each case as defined in Section 3.22
hereof, other than loans to directors, officers and employees in
the ordinary course of business consistent with past practice and
which are in compliance with the requirements of applicable laws
and regulations;
(xvi) enter into any futures contract, option
contract, interest rate caps, interest rate floors, interest rate
exchange agreement or other agreement for purposes of hedging the
exposure of its interest-earning assets and interest-bearing
liabilities to changes in market rates of interest;
(xvii) invest in "high risk" mortgage derivative
investments as defined in OTS Thrift Bulletin #52 or any other
investment securities outside the ordinary course of business;
(xviii) discharge or satisfy any lien or encumbrance
or pay any material obligation or liability (absolute or
contingent) other than at scheduled maturity or in the ordinary
course of business;
(xix) enter or agree to enter into any agreement or
arrangement granting any preferential right to purchase any of
its assets or rights or requiring the consent of any party to the
transfer and assignment of any such assets or rights;
(xx) agree to do any of the foregoing.
5.7 Current Information
During the period from the date of this Agreement to the
Effective Time, Boone shall, upon the request of Jones, cause one
or more of its designated representatives to confer on a monthly
or more frequent basis with representatives of Jones regarding
its financial condition, operations, business and prospects and
matters relating to the completion of the transactions
contemplated hereby. As soon as reasonably available, but in no
event more than 45 days after the end of each calendar quarter
ending after the date of this Agreement (other than the last
quarter of each calendar year), Boone will deliver to Jones its
quarterly report on Form 10-Q under the Exchange Act, and, as
soon as reasonably available, but in no event more than 90 days
after the end of each calendar year, Boone will deliver to the
Jones its Annual Report on Form 10-K. Within 25 days after the
end of each month, Boone shall provide Jones with the internal
financial statements and supplementary information normally
prepared for management. At the time such documents are required
to be filed with the OTS, Boone will deliver to Jones its Thrift
Financial Report and any other documents filed with the OTS.
As soon as practicable after the end of each calendar
quarter after the date of this Agreement, Jones shall deliver to
Boone a financial statement in the form customarily produced.
5.8 Directors, Officers and Employees
(a) Simultaneously with the execution and delivery of this
Agreement, Jones and each of the directors of Boone, shall enter
into a Stockholder Agreement in the form of Exhibit B hereto.
(b) Jones shall cause the Surviving Corporation to continue
to retain, following the Effective Time, all of the employees of
Boone and the Boone Subsidiary as of the Effective Time, provided
that Jones and the Surviving Corporation will have the right to
use their business judgment on an ongoing basis as to the
employment of any particular employee. Each employee of the
Surviving Corporation who is terminated by the Surviving
Corporation within one year after the Effective Time for a reason
other than cause or terminates their employment for "good reason"
as defined below at any time after the Effective Time of the
Merger shall be entitled to receive a lump sum severance payment
from the Surviving Corporation equal to two weeks base salary as
in effect immediately prior to the time of such termination for
each year of service with Boone with a minimum severance payment
equal to four weeks base salary and up to a maximum of 40 weeks
base salary. Each such employee shall be entitled to two weeks
of employer-paid coverage under employee benefit plans maintained
by Boone for employees in comparable positions for each year of
service with Boone up to a maximum of 40 weeks of such employer
paid coverage. All officers who are terminated by the Surviving
Corporation for a reason other than cause or who terminate their
employment for "good reason" as defined below shall in addition
be entitled to the payment of reasonable outplacement services.
For purposes of this Section 5.8(b), "good reason" means any of
the following which have not been consented to in writing by the
employee (a) a reduction in hourly wages or salary, or
(b) relocating any person more than 30 miles from the location of
Columbia, Missouri immediately prior thereto. The obligations of
Jones under this Section 5.8(b) are intended to benefit, and be
enforceable against Jones directly by, the employees of Boone.
(c) Jones will assure that Boone is maintained as a
separate entity headquartered in Columbia, Missouri for no less
than five years following the Effective Time, provided that a
majority of the Continuing Directors (as defined below) may waive
this provision. Notwithstanding the foregoing, Jones may sell
Boone free of the foregoing restriction if any change in Law (as
defined in Section 3.13(b)) or change in interpretation thereof
would (i) prohibit the continued ownership of Boone, (ii) require
Jones to exit a material line of business, (iii) require Boone to
cease engaging in a material line of business (including without
limitation national trust operations), or (iv) otherwise render
the continued ownership of Boone unduly burdensome (following
consultation with the Continuing Directors), provided that (X)
Jones shall have used its reasonable best efforts to persuade any
prospective purchaser to abide by the foregoing restriction and
shall have failed, and (Y) the acquiror or Jones shall provide to
the employees of Boone the same protections described in Section
5.8(b).
For purposes of the foregoing, a change in Law or
interpretation thereof will be considered to have made the
continued ownership of Boone unduly burdensome if such change in
Law or interpretation would (i) prohibit the continued ownership
of Boone, (ii) require Jones to exit a material line of business,
(iii) require Boone to cease engaging in a material line of
business (including without limitation national trust operations)
or (iv) impose similar burdens on Jones' continued ownership of
Boone (such as imposing a higher liability on Jones than
currently provided by law).
Those persons serving as directors of Boone immediately
prior to the Effective Time (the "Continuing Directors") shall
continue in that capacity following the Effective Time. Each
Continuing Director shall continue to serve the term to which he
was elected. Boone agrees that, subject to the applicable
regulatory requirements, effective as of the Effective Time, it
will take such action as is necessary to increase the members of
the Board of Directors of Boone by two and elect two members
designated by Jones. Each such person shall be elected for a
term which expires at the annual meeting of Boone following their
initial election by the Board of Directors of Boone.
(d) Prior to the Effective Time, in connection with the
execution of this Agreement and the Plan of Merger, Boone shall
amend its employment agreement with F.H. Kruse, Jr. in form and
substance satisfactory to Jones to provide that such agreement
shall terminate upon Closing. At the Closing, Jones will offer
to Mr. Kruse the opportunity to purchase a .25% general
partnership interest in Jones for a payment of $232,769, pursuant
to which Mr. Kruse will receive from Jones an annual guaranteed
payment of $100,000 per year. Jones shall also arrange through a
bank of its choosing, on behalf of F.H. Kruse, Jr., financing for
the purchase of such general partnership interest on terms
customarily provided by such bank to Jones general partners,
which financing shall require the payment of no more than 25%
down. Following the Effective Time, Jones agrees to cause the
Surviving Corporation to honor the terms of the Employment
Agreement, dated October 25, 1994 between Boone and Patti
Coffelt.
(e) The covenants and obligations of Jones and Interim in
paragraphs (c) and (d) of this Section 5.8 shall be subject to
the receipt of all required approvals and/or non-objections of
applicable regulatory authorities.
5.9 Employee Benefit Plans
Jones shall cause the Surviving Corporation to offer each
employee of Boone as of the Effective Time compensation and
employee benefits, which in the aggregate are comparable to the
compensation and benefits of such employee as of the date hereof,
without reference to any payments, awards or benefits under the
Boone profit-sharing plan or Boone Stock Option Plan. In the
event Jones terminates any employee benefit plan of Boone on or
after the Effective Time, each participating employee shall
either have the option of rolling over any accrued benefits under
such plans into an employee benefit plan of Jones or receive a
lump-sum payment in the amount of such accrued benefits. To the
extent such employees become participants in employee benefits
plans of Jones, such employees shall receive credit for their
years of service with Boone for purposes of determining
eligibility and vesting in all such employee benefit plans of
Jones, and shall be admitted with Jones waiving any otherwise
applicable waiting period and any exclusions from coverage for
pre-existing conditions which any such Boone employee may have as
of the Effective Date. To the best of its knowledge, Boone has
previously disclosed to Jones all pre-existing conditions of
Boone's employees. The obligations of Jones under this Section
5.9 are intended to benefit, and be enforceable against Jones
directly by, the employees of Boone.
5.10 Indemnification. Jones will cause the Surviving Corporation
to honor all obligations to indemnify all present and former
officers, directors and employees of Boone and the Surviving
Corporation which arise under all applicable laws and
regulations. Except as Previously Disclosed, there are no
indemnification obligations to present or former officers,
directors and employees of Boone other than those contained in
law and regulation. Jones will not allow the Surviving
Corporation to amend, transfer or revoke its charter unless
following such change the officers, directors and employees will
have the right to be indemnified to the same extent as they did
prior to such change. Jones will cause the Surviving Corporation
to maintain directors and officers liability insurance at least
as extensive as to amounts and terms of coverage as the insurance
currently carried by Boone. The obligations of Jones under this
Section 5.10 are intended to benefit, and be enforceable against
Jones directly by, the present and former officers, directors and
employees of Boone.
5.11 Disclosure Supplements
From time to time prior to the Effective Time, each party
shall promptly supplement or amend any materials Previously
Disclosed and delivered to the other party pursuant hereto with
respect to any matter hereafter arising which, if existing,
occurring or known at the date of this Agreement, would have been
required to be set forth or described in materials Previously
Disclosed to the other party or which is necessary to correct any
information in such materials which has been rendered materially
inaccurate thereby; no such supplement or amendment to such
materials shall be deemed to have modified the representations,
warranties and covenants of the parties for the purpose of
determining whether the conditions set forth in Article VI or
compliance by Boone with the covenants set forth in Section 5.6
hereof have been satisfied.
5.12 Dissenting Shares
Jones will cause the Surviving Corporation to make a written
offer by mail to each holder of shares who has made a demand for
appraisal and payment in accordance with 12 C.F.R. S552.14(c)(2)
and who did not vote for the Merger or otherwise duly withdraw
such demand) to pay for the shares held by such holder for a
price per share deemed by the Surviving Corporation to be the
fair value thereof in accordance with 12 C.F.R. S552.14(c)(3).
5.13 Jones, Interim and Surviving Corporation
Jones will cause Interim and the Surviving Corporation to
take the actions required of it under this Agreement.
Notwithstanding the foregoing and any other provision of this
Agreement or the Plan of Merger, except with respect to the
payment of the Merger Consideration, the amounts needed to pay
the Installment Notes, or the amounts needed to pay the holders
of options pursuant to Section 2.1, Jones shall not be required
to make any payment or capital contribution to the Surviving
Corporation pursuant to this Agreement or the Plan of Merger.
5.14 Failure to Fulfill Conditions
Each party will promptly inform the other party of any facts
applicable to it that would be likely to prevent or materially
delay approval of the Merger by any governmental authority or
third party or which would otherwise prevent or materially delay
completion of the Merger.
5.15 Legal Fees. Boone shall pay no legal fees or expenses in
connection with the transactions contemplated by this Agreement
in excess of the estimate received from Housley Goldberg
Kantarian & Bronstein, P.C., Washington, D.C. which has been
previously disclosed to Jones, without the approval of a majority
of the Boone Board of Directors.
ARTICLE VI
CONDITIONS PRECEDENT
6.1 Conditions Precedent - Jones and Boone
The respective obligations of Jones and Boone to effect the
transactions contemplated by this Agreement and the Plan of
Merger shall be subject to satisfaction of the following
conditions at or prior to the Effective Time.
(a) All corporate or partnership action necessary to
authorize the execution and delivery of this Agreement and
consummation of the transactions contemplated hereby and by the
Plan of Merger shall have been duly and validly taken by Jones,
Interim and Boone, including approval by the requisite vote of
the shareholders of Boone of this Agreement and the Plan of
Merger.
(b) All consents, approvals and non-objections, as
applicable, of the transactions contemplated hereby and the Plan
of Merger from the OTS and any other state or federal
governmental agency, department or body, the consent, approval or
non-objection of which is required for the consummation of the
Merger shall have been received and all notice periods and
waiting periods required after the granting of any such approvals
shall have passed and all such approvals shall remain in full
force and effect.
(c) None of Jones, Interim or Boone or their respective
Subsidiaries shall be subject to any statute, rule, regulation,
order or decree which shall have been enacted, entered,
promulgated or enforced by any governmental or judicial authority
which prohibits, restricts or makes illegal consummation of the
Merger or any of the other transactions contemplated hereby.
(d) The OTS shall have indicated that it has no additional
comments to the preliminary form of the Proxy Statement filed
with the OTS, and the Proxy Statement shall not be subject to a
stop order or threatened stop order by the OTS.
(e) The shareholders of Boone shall have approved the
Charter Amendment.
6.2 Conditions Precedent - Boone
The obligations of Boone to effect the transactions
contemplated by this Agreement shall be subject to satisfaction
of the following conditions at or prior to the Effective Time
unless waived by Boone pursuant to Section 7.4 hereof.
(a) The representations and warranties of Jones as set
forth in Article IV hereof shall be true and correct as of the
date of this Agreement and as of the Effective Time as though
made on and as of the Effective Time (or on the date when made in
the case of any representation and warranty which specifically
relates to an earlier date), provided, however, that
notwithstanding anything herein to the contrary, this Section
6.2(a) shall be deemed to have been satisfied even if such
representations or warranties are not true and correct unless the
failure of any of the representations or warranties to be so true
and correct (without reference to any limitation as to
materiality or knowledge contained in such representations and
warranties) could have, individually or in the aggregate, a
material adverse effect on the ability of Jones and Interim to
consummate the Merger and the other transactions contemplated
hereby.
(b) Jones shall have performed all obligations and
covenants required to be performed by it on or prior to the
Effective Time, except to the extent such nonperformance would
not have, individually or in the aggregate, a material adverse
effect on the ability of Jones and Interim to consummate the
Merger and the other transactions contemplated hereby.
(c) Jones shall have delivered to Boone a certificate,
dated the date of the Closing and signed by an authorized General
Partner of Jones to the effect that the conditions set forth in
Sections 6.2(a) and 6.2(b) have been satisfied.
(d) Boone shall have received an opinion of Bryan Cave, St.
Louis dated the date of the Closing, that address the matters set
forth in Annex II hereto.
(e) Jones shall have furnished Boone with such certificates
of its respective officers or others and such other documents to
evidence fulfillment of the conditions set forth in Sections 6.1
and 6.2 as such conditions relate to Jones and Interim as Boone
may reasonably request.
(f) Jones shall have offered to F.H. Kruse, Jr. the
opportunity to purchase a .25% general partnership interest in
Jones for a payment of $232,769, pursuant to which Mr. Kruse
would receive from Jones an annual guaranteed payment of $100,000
per year, and Jones shall have arranged through a bank of its
choosing, on behalf of F.H. Kruse, Jr., financing for the
purchase of such general partnership interest on terms
customarily provided by such bank to Jones general partners,
which financing shall require the payment of no more than 25%
down.
(g) Boone shall have received an opinion from RP Financial,
dated as of the date of the Proxy Statement and not withdrawn
prior to the date of the shareholder meeting referred to in
Section 5.1, to the effect that the Merger Consideration is fair
to Boone's shareholders from a financial point of view.
(h) Jones shall have deposited with the Exchange Agent an
amount of immediately available funds (and, to the extent elected
by shareholders, Installment Notes) equal to the sums of (i) the
aggregate Merger Consideration to be received by the shareholders
of Boone and (ii) the aggregate consideration to be received by
holders of options issued under the Boone Stock Option Plan
pursuant to Article III of the Plan of Merger.
6.3 Conditions Precedent - Jones
The obligations of Jones to effect the transactions
contemplated by this Agreement shall be subject to satisfaction
of the following conditions at or prior to the Effective Time
unless waived by Jones pursuant to Section 7.4 hereof.
(a) The representations and warranties of Boone set forth
in Article III hereof shall be true and correct as of the date of
this Agreement and as of the Effective Time as though made on and
as of the Effective Time (or on the date when made in the case of
any representation and warranty which specifically relates to an
earlier date), provided, however, that notwithstanding anything
herein to the contrary, this Section 6.3(a) shall be deemed to
have been satisfied even if such representations or warranties
are not true and correct unless the failure of any of the
representations or warranties to be so true and correct (without
reference to any limitation as to materiality or knowledge
contained in such representations and warranties) would have,
individually or in the aggregate, a material adverse effect on
the financial condition, results of operations, business or
prospects of Boone on a consolidated basis.
(b) Boone shall have performed all obligations and
covenants required to be performed by it on or prior to the
Effective Time, except to extent such non-performance would not
have, individually or in the aggregate, a material adverse effect
on the financial condition, results of operations, business or
prospects of Boone on a consolidated basis.
(c) Boone shall have delivered to Jones a certificate,
dated the date of the Closing and signed by its Chairman or
President, to the effect that the conditions set forth in
Sections 6.3(a) and 6.3(b) have been satisfied.
(d) There shall have been obtained all permits, consents,
waivers, clearances, approvals and authorizations of all third
parties which are necessary in connection with the consummation
of the Merger and the other transactions contemplated hereby the
failure of which to obtain would have a material adverse effect
on the financial condition, results of operations, business or
prospects of Boone on a consolidated basis or on the ability of
Jones or Boone to consummate the transactions contemplated hereby
and the Plan of Merger, and none of such permits, consents,
waivers, clearances, approvals and authorizations shall contain
any term or condition which would materially impair the value of
Boone and the Boone Subsidiary to Jones, provided that a
condition or requirement that after the Effective Time Jones
(i) comply with OTS regulations governing the exercise of trust
powers by Boone, sales of securities through the offices of Boone
or transactions between Jones or a Jones Subsidiary and Boone, or
(ii) retain an experienced trust officer acceptable to the OTS
shall not be deemed to result in such a material impairment of
value.
(e) Jones shall have received an opinion of Housley
Goldberg Kantarian & Bronstein, P.C., Washington, D.C., and local
counsel in Columbia, Missouri, dated the date of the Closing,
that collectively address the matters set forth in Annex III
hereto.
(f) The parties referred to in Sections 5.8(a) and (d) shall
have entered into the agreements and adopted the amendments
referred to therein and such agreements and amendments shall be
in full force and effect.
(g) Boone shall have furnished Jones with such certificates
of its officers or others and such other documents to evidence
fulfillment of the conditions set forth in Sections 6.1 and 6. as
such conditions relate to Boone as Jones may reasonably request.
(h) F.H. Kruse, Jr. shall be employed by Boone and shall
have given no indication that he shall not remain so employed
following the Effective Time. Boone shall have amended its
employment agreement with F.H. Kruse, Jr., in form and substance
satisfactory to Jones, to provide that such agreement shall
terminate upon Closing. F.H. Kruse, Jr. shall have accepted
Jones' offer to purchase a .25% general partnership interest in
Jones for a payment of $232,769, pursuant to which Mr. Kruse
would receive from Jones an annual salary of $100,000 per year.
(j) Holders of no more than 10% of the outstanding shares
of Boone Common Stock at the Effective Time shall have made a
demand for appraisal and payment in accordance with 12 C.F.R.
S552.14(c)(2) and not voted for the Merger and not otherwise duly
withdrawn such demand.
(k) There shall have been no material adverse change in the
financial condition, results of operation, business or prospects
of Boone following the date hereof other than changes resulting
from or attributable to or resulting from (i) changes in laws,
regulations, generally accepted accounting principles, or
interpretations thereof, that affect the banking or savings and
loan industries generally, or (ii) reasonable expenses incurred
in connection with transactions contemplated by this Agreement
and the Plan of Merger.
ARTICLE VII
TERMINATION, WAIVER AND AMENDMENT
7.1 Termination
This Agreement may be terminated:
(a) at any time on or prior to the Effective Time, by the
mutual consent in writing of the parties hereto;
(b) at any time on or prior to the Effective Time, by Jones
in writing if Boone has, or by Boone in writing if Jones has,
breached (and such breach has not been waived in writing) (i) any
covenant or undertaking contained herein or in the Plan of
Merger, which breach, individually or in the aggregate, would
have a material adverse effect on the financial condition,
results of operations, business or prospects of Boone or on
Boone's ability to consummate the transactions contemplated
hereby (if the breach is by Boone) or on Jones' ability to
consummate the transactions contemplated hereby (if the breach is
by Jones), or (ii) any representation or warranty contained
herein, which breach (without reference to any limitation as to
materiality or knowledge contained in such representation or
warranty), individually or in the aggregate, would have a
material adverse effect on the financial condition, results of
operations, business or prospects of Boone or on Boone's ability
to consummate the transactions contemplated hereby (if the breach
is by Boone) or on Jones' ability to consummate the transactions
contemplated hereby (if the breach is by Jones), in any case if
such breach has not been cured by the earlier of 30 days after
the date on which written notice of such breach is given to the
party committing such breach or the Effective Time;
(c) at any time, by any party hereto in writing, if any of
the applications for prior approval referred to in Section 5.2
hereof are denied or are approved contingent upon the
satisfaction of any condition or requirement which, in the
reasonable opinion of Jones, would so materially adversely affect
the business or economic benefits of the transactions
contemplated by this Agreement as to render consummation of such
transactions unduly burdensome, and the time period for appeals
and requests for reconsideration has run, provided that a
condition or requirement that after the Effective Time Jones
(i) comply with OTS regulations governing the exercise of trust
powers by Boone, sales of securities through the offices of Boone
or transactions between Jones or a Jones Subsidiary and Boone, or
(ii) retain an experienced trust officer acceptable to the OTS
shall not be deemed to result in such a material adverse effect;
(d) [intentionally left blank]
(e) at any time, by any party hereto in writing, if the
shareholders of Boone do not approve this Agreement, the Plan of
Merger and the Charter Amendment in the required manner by a vote
taken thereon at a meeting duly called for such purpose unless
the failure of such occurrence shall be due to the failure of the
party seeking to terminate to perform or observe in any material
respect its agreements set forth herein to be performed or
observed by such party at or before such meeting of shareholders;
(f) by any party hereto in writing, if the Effective Time
has not occurred by the close of business one year from the date
hereof, provided that this right to terminate shall not be
available to any party whose failure to perform an obligation
under this Agreement has been the cause of, or resulted in, the
failure of the Merger and the other transactions contemplated
hereby to be consummated by such date; and
(g) at any time by any party hereto in writing if such
party is not in default hereunder and such party determines in
good faith that any condition precedent to such party's
obligations to consummate the Merger and the other transactions
contemplated hereby is or would be impossible to satisfy, and
such condition is not waived by such party.
7.2 Effect of Termination
In the event that this Agreement is terminated pursuant to
Section 7.1 hereof, both this Agreement and the Plan of Merger
shall become void and have no effect, except that (i) the
provisions relating to confidentiality and expenses set forth in
Section 5.4 and Section 8.1, respectively, shall survive any such
termination and (ii) a termination pursuant to Section 7.1(b),
(e), (f) or (g) shall not relieve the breaching party from
liability for willful breach of any covenant, undertaking,
representation or warranty giving rise to such termination.
7.3 Survival of Representations, Warranties and Covenants
All representations, warranties and covenants (other than
covenants which are by their terms to be performed after the
Effective Time) in this Agreement or the Plan of Merger or in any
instrument delivered pursuant hereto or thereto shall expire on,
and be terminated and extinguished at, the Effective Time,
provided that no such representations, warranties or covenants
shall be deemed to be terminated or extinguished so as to deprive
Jones or Boone (or any director, officer or controlling person
thereof) of any defense at law or in equity which otherwise would
be available against the claims of any person, including, without
limitation, any shareholder or former shareholder of either Jones
or Boone, the aforesaid representations, warranties and covenants
being material inducements to consummation by Jones and Boone of
the transactions contemplated hereby.
7.4 Waiver
Each party hereto by written instrument signed by an
executive officer of such party, may at any time (whether before
or after approval of this Agreement and the Plan of Merger by the
shareholders of Boone) extend the time for the performance of any
of the obligations or other acts of the other party hereto and
may waive (i) any inaccuracies of the other party in the
representations or warranties contained in this Agreement, or any
document delivered pursuant hereto, (ii) compliance with any of
the covenants, undertakings or agreements of the other party or,
to the extent permitted by law, satisfaction of any of the
conditions precedent to its obligations contained herein or the
Plan of Merger or (iii) the performance by the other party of any
of its obligations set forth herein or therein, provided that any
such waiver granted, or any amendment or supplement pursuant to
Section 7.5 hereof executed, after shareholders of Boone have
approved this Agreement and the Plan of Merger shall not modify
either the amount or form of the Merger Consideration or
otherwise materially adversely affect any of such shareholders
without the approval of the shareholders who are so affected.
7.5 Amendment or Supplement
This Agreement and the Plan of Merger may be amended or
supplemented at any time by mutual agreement of Jones and Boone,
subject to the proviso to Section 7.4 hereof. Any such amendment
or supplement must be in writing and in the case of Boone,
approved by its Board of Directors.
ARTICLE VIII
MISCELLANEOUS
8.1 Expenses
Each party hereto shall bear and pay all costs and expenses
incurred by it in connection with the transactions contemplated
by this Agreement, including fees and expenses of its own
financial consultants, accountants and counsel, provided that in
the event of a termination of this Agreement resulting from a
breach of a representation, warranty, covenant or undertaking,
the party committing such breach shall be liable for the expenses
of the other parties without prejudice to any other remedies as
may be available to the non-breaching party.
8.2 Entire Agreement
This Agreement, including the exhibits and annexes hereto
and the documents referred to herein, contains the entire
agreement between the parties with respect to the transactions
contemplated hereby and supersedes all prior arrangements or
understandings with respect thereto, written or oral, other than
documents referred to herein or therein. The terms and
conditions of this Agreement shall inure to the benefit of and be
binding upon the parties hereto and thereto and their respective
successors. Except as specifically provided herein, nothing in
this Agreement and the Plan of Merger, expressed or implied, is
intended to confer upon any party, other than the parties hereto
and thereto, and their respective successors, any rights,
remedies, obligations or liabilities.
8.3 Assignment
Neither of the parties hereto may assign any of its rights
or obligations under this Agreement to any other person, provided
that following the Effective Time Jones may assign its
obligations hereunder in connection with any sale of Boone.
8.4 Notices
All notices or other communications which are required or
permitted hereunder shall be in writing and sufficient if
delivered personally or sent by overnight express or by
registered or certified mail, postage prepaid, addressed as
follows:
If to Jones:
The Jones Financial Companies
201 Progress Parkway
Maryland Heights, Missouri 63043-3042
Attn: Steven Novik
With a required copy to:
Bryan Cave
One Metropolitan Square
211 North Broadway
St. Louis Missouri 63102-2750
Attn: J. Mark Klamer
If to Boone:
Boone National Savings and Loan Association, F.A.
901 East Broadway,
Columbia, Missouri 65201
Attn: F.H. Kruse, Jr.
With a required copy to:
Housley Goldberg Kantarian & Bronstein, P.C.
Suite 700
1220 19th Street, N.W.
Washington D.C. 20036
Attn: James C. Stewart, Esq.
8.5 Interpretation
The captions contained in this Agreement are for reference
purposes only and are not part of this Agreement and shall not be
used to help construe the meaning hereof.
8.6 Counterparts
This Agreement may be executed in any number of
counterparts, and each such counterpart shall be deemed to be an
original instrument, but all such counterparts together shall
constitute but one agreement.
8.7 Governing Law
This Agreement shall be governed by and construed in
accordance with the laws of the State of Missouri applicable to
agreements made and entirely to be performed within such
jurisdiction except to the extent federal law may be applicable.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed in counterparts by their duly authorized
officers and their corporate seal to be hereunto affixed and
attested by their officers thereunto duly authorized, all as of
the day and year first above written.
THE JONES FINANCIAL COMPANIES
By:
Name:
Title: General Partner
BOONE NATIONAL SAVINGS AND LOAN
ASSOCIATION, F.A.
By:
Name:
Title:
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed in counterparts by their duly authorized
officers and their corporate seal to be hereunto affixed and
attested by their officers thereunto duly authorized, all as of
the day and year first above written.
THE JONES FINANCIAL COMPANIES
By:
Name:
Title: General Partner
BOONE NATIONAL SAVINGS AND LOAN
ASSOCIATION, F.A.
By:
Name:
Title:
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed in counterparts by their duly authorized
officers and their corporate seal to be hereunto affixed and
attested by their officers thereunto duly authorized, all as of
the day and year first above written.
THE JONES FINANCIAL COMPANIES
By:
Name:
Title: General Partner
BOONE NATIONAL SAVINGS AND LOAN
ASSOCIATION, F.A.
By:
Name:
Title:
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed in counterparts by their duly authorized
officers and their corporate seal to be hereunto affixed and
attested by their officers thereunto duly authorized, all as of
the day and year first above written.
THE JONES FINANCIAL COMPANIES
By:
Name:
Title: General Partner
BOONE NATIONAL SAVINGS AND LOAN
ASSOCIATION, F.A.
By:
Name:
Title:
EXHIBIT A
PLAN OF MERGER
Plan of Merger, dated as of ____________ ___, 199__, by and
between [Jones Interim Bank, F.A.], a federally chartered savings
and loan association ("Interim") and Boone National Savings and
Loan Association, F.A., a federally chartered stock savings and
loan association ("Boone") and concurred in by The Jones
Financial Companies ("Jones"), a Missouri partnership, which is
the sole shareholder of Interim.
W I T N E S S E T H:
WHEREAS, Interim is a wholly-owned subsidiary of The Jones
Financial Companies, a Missouri limited partnership ("Jones");
WHEREAS, Jones and Boone have previously entered into an
Agreement and Plan of Acquisition, dated as of October 25, 1994
(the "Agreement");
WHEREAS, Jones has organized Interim in connection with the
application for regulatory approval of the transactions
contemplated hereby and by the Agreement; and
WHEREAS, pursuant to the Agreement and this Plan of Merger,
and subject to the terms and conditions set forth therein and
herein, Interim shall be merged with and into Boone, with Boone
the surviving corporation of such merger;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants and agreements contained herein and in the
Agreement, the parties hereto do mutually agree as follows:
ARTICLE I
DEFINITIONS
Except as otherwise provided herein, the capitalized terms
set forth below shall have the following meanings:
1.1 "Boone Common Stock" shall mean the common stock, par
value $1.00 per share, of Boone.
1.2 "Boone Stock Option Plan" shall mean the Boone National
Savings and Loan Association, F.A. 1990 Stock Option Plan.
1.3 "Effective Time" shall mean the date and time at which
the merger contemplated by this Plan of Merger becomes effective
as provided in Section 2.2 of this Plan of Merger.
1.4 "Merger Consideration" shall be equal to $69.78 for
each of the 115,041 outstanding shares of Boone Common Stock.
1.5 "FDIC" shall mean the Federal Deposit Insurance
Corporation, or any successor thereto.
1.6 "FHLB" shall mean Federal Home Loan Bank.
1.7 "HOLA" shall mean the Home Owners' Loan Act.
1.8 "Merger" shall refer to the merger of Boone with and
into Interim as provided in Section 2.1 of this Plan of Merger.
1.9 "Merging Corporations" shall collectively refer to
Interim and Boone.
1.10 "Shareholder Meeting" shall mean the annual or special
meeting of the shareholders of Boone held in accordance with the
terms of Section 5.1 of the Agreement.
1.11 "Surviving Corporation" shall mean Boone as the
surviving corporation of the Merger.
ARTICLE II
TERMS OF THE MERGER
2.1 The Merger. Subject to the terms and conditions set
forth in the Agreement, at the Effective Time, Interim shall be
merged with and into Boone pursuant to the HOLA and the rules and
regulations promulgated thereunder. Boone shall be the Surviving
Corporation of the Merger and shall continue to be a savings
association governed by the laws of the United States. At the
Effective Time, the separate existence and corporate organization
of Interim shall cease, and the Surviving Corporation shall be
deemed to be a continuation of Interim and Boone such that all
property of Interim and Boone, including rights, titles and
interests in and to all property of whatsoever kind, whether
real, personal or mixed, and things in action, and every right,
privilege, interest and asset of any conceivable value or benefit
then existing, or pertaining to them or which would inure to
them, including appointments, designations and nominations, and
all other rights and interests as trustee, personal
representative, guardian and conservator, and in every other
fiduciary capacity, shall immediately by act of law and without
any conveyance or transfer and without further act or deed be
vested in and continue to be that property of the Surviving
Corporation; and the Surviving Corporation shall have, hold and
enjoy the same in its own right as fully and to the same extent
as the same was possessed, held and enjoyed by Interim and Boone.
2.2 Effective Time. The Merger shall become effective at
5:00 p.m. on the date of Closing (as defined in the Agreement) or
as otherwise specified by law, in accordance with the provisions
of HOLA and the rules and regulations thereunder ("Effective
Time").
2.3 Name of the Surviving Corporation. The name of the
Surviving Corporation shall remain "Boone National Savings and
Loan Association, F.A.".
2.4 Charter. On and after the Effective Time, the Charter
of [Interim] [Boone] shall be the Charter of the Surviving
Corporation, until further amended in accordance with applicable
law.
2.5 Bylaws. On and after the Effective Time, the Bylaws of
[Interim] [Boone] shall be the Bylaws of the Surviving
Corporation, amended as necessary to conform to the requirements
of Section 2.6, until further amended in accordance with
applicable law.
2.6 Directors and Officers. On and after the Effective
Time, until changed in accordance with the Charter and Bylaws of
the Surviving Corporation, (i) the directors of the Surviving
Corporation shall number __________ and consist of the directors
of Boone immediately prior to the Effective Time and two
directors appointed by Jones pursuant to Section 5.8(c) of the
Agreement and (ii) the officers of the Surviving Corporation
shall be the officers of Boone immediately prior to the Effective
Time. The directors and officers of the Surviving Corporation
shall hold office in accordance with the Charter and Bylaws of
the Surviving Corporation. Attached hereto as Annex I is a list
of the directors (including addresses and occupations) and
officers (including addresses) of the Surviving Corporation.
2.7 Capital Stock. The number of authorized shares of
capital stock shall be the same as that of Boone immediately
prior to the Effective Time.
2.8 Office Location. The home office of the Surviving
Corporation shall be in Columbia, Missouri.
2.9 Savings Accounts. The savings accounts of Boone shall
remain savings accounts of the Surviving Corporation.
ARTICLE III
CONVERSION OF BOONE AND INTERIM SHARES
3.1 Conversion of Boone Common Stock, Options to Purchase
Boone Common Stock and Interim Common Stock.
(a) At the Effective Time, each share of Boone Common Stock
issued and outstanding immediately prior to the Effective Time
(other than (i) any shares held by Jones or any wholly-owned
subsidiary thereof, with the exception of shares held in a
fiduciary capacity or in satisfaction of a debt previously
contracted in good faith or (ii) shares held by a holder who has
made a demand for appraisal and payment in accordance with
12 C.F.R. S552.14(c)(2) and who has not voted for the Merger)
shall, by virtue of the Merger and without any action on the part
of the holder thereof, be converted into the right to receive the
Merger Consideration, payable in cash, without interest thereon.
As of the Effective Time, each share of Boone Common Stock held
by Jones or any wholly-owned subsidiary thereof, other than
shares held in a fiduciary capacity or in satisfaction of a debt
previously contracted in good faith, and shares held as treasury
stock of Boone, shall be cancelled, retired and cease to exist,
and no exchange or payment shall be made in respect thereof.
(b) Prior to the Effective Time, Boone shall obtain a
written, executed Release and Waiver Agreement from each holder
of an outstanding option to purchase Boone Common Stock pursuant
to the Stock Option Plan, whether or not then vested or
exercisable. Pursuant to such Release and Waiver Agreement, the
holder shall agree to release any and all rights, claims or
actions which he may have with respect to the Stock Option Plan.
As consideration for execution of such release, following the
Effective Time, Jones shall pay to the holder for each such
option an amount determined by multiplying (i) the excess, if
any, of the Merger Consideration over the applicable exercise
price per share of such option by (ii) the number of shares of
Boone Common Stock subject to such option.
(c) Each holder of shares of Boone Common Stock at the
Effective Time who has made a demand for appraisal and payment in
accordance with 12 C.F.R. S552.14(c)(2) and who has not voted for
the Merger or duly withdrawn such demand shall be entitled to
those rights to which such holder is entitled under applicable
law.
(d) At the Effective Time, each issued and outstanding
share of Interim Common Stock shall, by virtue of the Merger and
without any action on the part of the holder thereof, be
converted into and become one validly issued, fully paid and
nonassessable share of common stock of the Surviving Corporation.
3.2 Surrender of Shares.
(a) At or after the Effective Time, each holder of a
certificate or certificates theretofore evidencing issued and
outstanding shares of Boone Common Stock (other than (i) any
shares held by Jones or any wholly-owned subsidiary thereof, with
the exception of shares held in a fiduciary capacity or in
satisfaction of a debt previously contracted in good faith or
(ii) shares held by a holder who has made a demand for appraisal
and payment in accordance with 12 C.F.R. S552.14(c)(2) and who
has not voted for the Merger or duly withdrawn such demand), upon
surrender of the same to an agent (which agent may be the
Surviving Corporation) duly appointed by Jones whose appointment
is reasonably acceptable to Boone (the Surviving Corporation
being deemed to be reasonably acceptable) ("Exchange Agent") and
a properly completed Letter of Transmittal (as defined below),
shall be entitled to receive in exchange therefor a check for an
amount equal to the Merger Consideration multiplied by the number
of shares of Boone Common Stock theretofore represented by the
certificate or certificates so surrendered. The Exchange Agent
shall mail to each holder of record of an outstanding certificate
which immediately prior to the Effective Time evidenced shares of
Boone Common Stock (other than (i) any shares held by Jones or
any wholly-owned subsidiary thereof, with the exception of shares
held in a fiduciary capacity or in satisfaction of a debt
previously contracted in good faith or (ii) shares held by a
holder who has made a demand for appraisal and payment in
accordance with 12 C.F.R. S552.14(c)(2) and who has not voted for
the Merger or duly withdrawn such demand), a form of letter of
transmittal ("Letter of Transmittal") (which shall specify that
delivery shall be effected, and risk of loss and title to such
certificate shall pass, only upon delivery of such certificate to
the Exchange Agent) advising such holder of the terms of the
Merger and of the procedure for surrendering to the Exchange
Agent such certificate in exchange for a check in the amount of
the aggregate Merger Consideration therefor.
The Merger Consideration shall be paid to the shareholders
by the Exchange Agent by check, except that if a shareholder owns
1000 or more shares of Boone Common Stock, he or she may elect
(prior to the shareholder meeting described in Section 5.1 in the
Agreement) to receive, in lieu of a check for the aggregate
Merger Consideration due such holder, a check of one-quarter of
the aggregate Merger Consideration due such holder and an
Installment Note (as defined herein) in a form reasonably
acceptable to Boone for three-quarters of such amount ("Note
Amount"), provided that if the issuance thereof would require
registration under the Securities Act of 1933, as amended, the
cost of such registration (to a maximum of $1.00 per share owned
by such holder) would be deducted from the principal amount of
such Installment Note. An "Installment Note" (i) will be a
promissory note of Jones in the amount of the Note Amount,
(ii) will be backed by an irrevocable non-transferrable stand-by
letter of credit issued by a bank ("Letter of Credit"),
(iii) will accrue interest at annual rate equal to the 18 month
treasury bill rate at the Effective Time, less 50 basis points
(an amount equal to the Letter of Credit fee) or, if higher, the
lowest applicable short-term rate as determined in S1274(d) of
the Internal Revenue Code of 1986, as amended, at the Effective
Time in respect of the Installment Note, and (iv) will be payable
in three equal installments of principal on the first, second and
third yearly anniversary of the Effective Time, with interest on
the outstanding and unpaid principal for the previous year also
payable on such anniversary dates.
(b) No holder of a certificate theretofore representing
shares of Boone Common Stock shall be entitled to any dividend,
voting or other rights of a shareholder of Boone following the
Effective Time.
(c) On or prior to the Effective Time, Jones shall deposit
with the Exchange Agent an amount of immediately available funds
equal to the sum of (i) the aggregate Merger Consideration to be
received by the shareholders of Boone and (ii) the aggregate
consideration to be received by holders of options issued under
the Boone Stock Option Plan pursuant to this Plan of Merger. The
Exchange Agent shall not pay the aggregate Merger Consideration
that each holder of certificates theretofore representing shares
of Boone Common Stock would otherwise be entitled as a result of
the Merger until such holder surrenders the certificate or
certificates representing the shares of Boone Common Stock for
exchange as provided in this Section 3.2, or, in default thereof,
an appropriate Affidavit of Loss and Indemnity Agreement and/or a
bond as may be required in each case by Jones. If any check or
Installment Note is to be issued in a name other than that in
which the certificate theretofore representing Boone Common Stock
surrendered in exchange therefor is registered, it shall be a
condition of the issuance thereof that the certificate so
surrendered shall be properly endorsed and otherwise in proper
form for transfer and that the person making such request pay to
the Exchange Agent any transfer or other tax required thereby or
otherwise establish to the satisfaction of the Exchange Agent
that such tax has been paid or is not payable.
(d) The payment of any consideration referred to in Section
3.1(c) hereof to holders of options to purchase Boone Common
Stock shall be subject to the execution by any such holder of
such instruments of cancellation of rights as Jones may
reasonably deem appropriate.
ARTICLE IV
TERMINATION
This Plan of Merger shall terminate upon any termination of
the Agreement.
ARTICLE V
MISCELLANEOUS
5.1 Conditions Precedent. The respective obligations of
each party under this Plan of Merger shall be subject to the
satisfaction, or waiver by the party permitted to do so, of the
conditions set forth in Article VI of the Agreement, including
but not limited to, approval of this Plan of Merger and the
Agreement, and the transactions contemplated hereby and thereby,
by the stockholders of Boone, by Jones in its capacity as the
sole stockholder of Interim and by all applicable regulatory
authorities.
5.2 Amendments. To the extent permitted by the HOLA, this
Plan of Merger may be amended by a subsequent writing signed by
each of the parties hereto upon the approval of the Board of
Directors of each of the parties hereto; provided, however, that
the provisions of Article III of this Plan of Merger relating to
the consideration to be paid for the shares of Boone Common Stock
shall not be amended after the Shareholder Meeting so as to
modify either the amount or the form of such consideration or to
otherwise materially adversely affect the shareholders of Boone
without the approval of the shareholders of Boone who are so
affected.
5.3 Successors. This Plan of Merger shall be binding on
the successors of Jones, Interim and Boone.
IN WITNESS WHEREOF, Interim and Boone have caused this Plan
of Merger to be executed by their duly authorized officers as of
the day and year first above written.
[JONES INTERIM BANK, F.A.]
By:
Name:
Title:
BOONE NATIONAL SAVINGS AND LOAN
ASSOCIATION, F.A.
By:
Name:
Title:
Jones concurs in the foregoing Plan of Merger and undertakes
that it will be bound thereby and that it will do and perform all
acts and things therein referred to or provided to be done by it.
THE JONES FINANCIAL COMPANIES
By: ___________________________
General Partner
EXHIBIT B
STOCKHOLDER AGREEMENT
STOCKHOLDER AGREEMENT, dated as of October 25, 1994 by and
among The Jones Financial Companies, a Missouri limited
partnership ("Jones") and certain stockholders of Boone National
Savings and Loan Association, F.A., a federally chartered stock
savings and loan association ("Boone") named on Schedule I hereto
(collectively the "Stockholders").
WHEREAS, Jones and Boone have entered into an Agreement and
Plan of Acquisition, dated as of the date hereof ("Agreement");
WHEREAS, Jones will organize [Jones Interim Bank, F.A.]
("Interim") in connection with the application for regulatory
approval of the transactions contemplated by the Agreement;
WHEREAS, the Agreement provides for, among other things, the
merger of Interim with and into Boone (the "Merger"), pursuant to
a Plan of Merger which is attached as Exhibit A to the Agreement;
and
WHEREAS, in order to induce Boone to enter into the
Agreement, each of the Stockholders agrees to, among other
things, vote in favor of the Agreement and the related Plan of
Merger in their capacities as stockholders of Boone;
NOW, THEREFORE, in consideration of the premises, the mutual
covenants and agreements set forth herein and other good and
valuable consideration, the sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. Ownership of Boone Common Stock. Each Stockholder
represents and warrants that the Stockholder has or shares the
right to vote and dispose of the number of shares of common stock
of Boone, par value $1.00 per share ("Boone Common Stock"), set
forth opposite such Stockholder's name on Schedule I hereto.
2. Agreements of the Stockholders. Each Stockholder covenants
and agrees that:
(a) such Stockholder shall, at any meeting of Boone's
stockholders called for the purpose, vote, or cause to be
voted, all shares of Boone Common Stock in which such
stockholder has the right to vote (whether owned as of the
date hereof or hereafter acquired) in favor of the Agreement
and related Plan of Merger and against any plan or proposal
pursuant to which Boone is to be acquired by or merged with,
or pursuant to which Boone proposes to sell all or
substantially all of its assets and liabilities to, any
person, entity or group (other than Jones or any affiliate
thereof);
(b) except as otherwise expressly permitted hereby,
such Stockholder shall not, prior to the meeting of Boone's
stockholders referred to in Section 2(a) hereof or the
earlier termination of the Agreement in accordance with its
terms, sell, pledge, transfer or otherwise dispose of the
Stockholder's shares of Boone Common Stock; and
(c) such Stockholder shall not in his capacity as a
stockholder of Boone directly or indirectly encourage or
solicit or hold discussions or negotiations with, or provide
any information to, any person, entity or group (other than
Jones or an affiliate thereof) concerning any merger, sale
of substantial assets or liabilities not in the ordinary
course of business, sale of shares of capital stock or
similar transactions involving Boone or any subsidiary of
Boone (provided that nothing herein shall be deemed to
affect the ability of any Stockholder to fulfill his duties
as a director or officer of Boone); and
(d) such Stockholder shall use his best efforts to
take or cause to be taken all action, and to do or cause to
be done all things necessary, proper or advisable under
applicable laws and regulations to consummate and make
effective the agreements contemplated by this Stockholder
Agreement.
3. Successors and Assigns. A Stockholder may sell, pledge,
transfer or otherwise dispose of his shares of Boone Common
Stock, provided that such Stockholder obtains the prior written
consent of Jones and that any acquiror of such Boone Common Stock
agree in writing to be bound by the terms of this Stockholder
Agreement.
4. Termination. The parties agree and intend that this
Stockholder Agreement be a valid and binding agreement
enforceable against the parties hereto and that damages and other
remedies at law for the breach of this Stockholder Agreement are
inadequate. This Stockholder Agreement may be terminated at any
time prior to the consummation of the Merger by mutual written
consent of the parties hereto and shall be automatically
terminated in the event that the Agreement is terminated in
accordance with its terms.
5. Notices. Notices may be provided to Jones and the
Stockholders in the manner specified in Section 8.4 of the
Agreement, with all notices to the Stockholders being provided to
them at Boone in the manner specified in such section.
6. Governing Law. This Stockholder Agreement shall be governed
by the laws of the State of Missouri, without giving effect to
the principles of conflicts of laws thereof.
7. Counterparts. This Stockholder Agreement may be executed in
one or more counterparts, all of which shall be considered one
and the same and each of which shall be deemed an original.
8. Headings and Gender. The Section headings contained herein
are for reference purposes only and shall not affect in any way
the meaning or interpretation of this Stockholder Agreement. Use
of the masculine gender herein shall be considered to represent
the masculine, feminine or neuter gender whenever appropriate.
IN WITNESS WHEREOF, Jones and each of the Stockholders have
caused this Stockholder Agreement to be executed as of the day
and year first above written.
THE JONES FINANCIAL COMPANIES
By:
Name:
Title: General Partner
BOONE STOCKHOLDERS:
__________________________________
Dale Nichols
__________________________________
Thomas R. Gray
__________________________________
F.H. Kruse, Jr.
__________________________________
Robert D. Black
__________________________________
Jose L. Lindner
__________________________________
Donald Schilling
__________________________________
Dr. Harry M. Sulzberger
SCHEDULE I
Name of Stockholder
Number of Shares of
Boone Common Stock Beneficially Owned
Dale Nichols
Thomas R. Gray
F.H. Kruse, Jr.
Robert D. Black
Jose L. Lindner
Donald Schilling
Dr. Harry M. Sulzberger
ANNEX I
[Matters to be covered in Opinion(s) of Counsel to be delivered
to Boone pursuant to Section 6.2(d) of the Agreement]
(a) Interim is duly incorporated, validly existing and in
good standing under the laws of the jurisdiction of its
incorporation. Jones is validly existing under the laws of
Missouri.
(b) All of the outstanding shares of capital stock of
Interim have been duly authorized and validly issued, are fully
paid and nonassessable.
(c) The Agreement and the Plan of Merger have been duly
authorized, executed and delivered by Jones and Interim,
respectively, and constitute valid and binding obligations of
Jones and Interim, respectively, enforceable in accordance with
their terms, except that the enforceability of the obligations of
Jones and Interim may be limited by (i) bankruptcy, receivership
or conservatorship, insolvency, moratorium, reorganization or
similar laws affecting the rights of creditors, (ii) equitable
principles limiting the right to obtain specific performance or
other similar equitable relief and (iii) considerations of public
policy, and except that certain remedies may not be available in
the case of a nonmaterial breach of the Agreement and the Plan of
Merger.
(d) All partnership, corporate and shareholder actions
required to be taken by Jones and Interim by law and their
Partnership Agreement or Articles of Incorporation and Bylaws, as
applicable, to authorize the execution and delivery of the
Agreement and the Plan of Merger, as applicable, and consummation
of the Merger have been taken.
(e) All permits, consents, waivers, clearances, approvals
and authorizations of any regulatory or governmental body which
are necessary to be obtained by Jones and Interim to permit the
execution, delivery and performance of the Agreement and the Plan
of Merger, respectively, and consummation of the Merger have been
obtained.
(f) Assuming due authorization of the Merger by all
necessary corporate and governmental proceedings on the part of
Boone and that Boone has taken all action required to be taken by
it prior to the Effective Time, (i) the Merger will be validly
consummated in accordance with the Agreement, the Plan of Merger
and applicable laws and regulations, provided that no opinion
will be expressed pursuant to the treatment of outstanding
options set forth in the Plan of Merger, and (ii) each
outstanding share of Common Stock will be converted as specified
in the Plan of Merger.
Such counsel also shall state that it has no reason to
believe that the information provided by Jones in writing and
relating to Jones contained in the Proxy Statement, as of the
date(s) such Proxy Statement was mailed to shareholders of Boone
and up to and including the date(s) of the meeting of
shareholders to which such Proxy Statement relates, contained any
untrue statement of a material fact or omitted to state a
material fact necessary to make the statements therein, in light
of the circumstances under which they were made, not misleading.
In rendering their opinion, such counsel may rely, to the
extent such counsel deems such reliance necessary or appropriate,
upon certificates of governmental officials and, as to matters of
fact, certificates of officers or partners of Jones or any Jones
Subsidiary. The opinion of such counsel need refer only to
matters of Missouri and federal law, and may add other
qualifications and explanations of the basis of their opinion as
may be reasonably acceptable to Boone.
ANNEX II
[Matters to be covered in Opinion of Counsel to be delivered to
Jones pursuant to Section 6.3(e) of the Agreement]
(a) Each of Boone and the Boone Subsidiary is duly
incorporated and validly existing and, if applicable, in good
standing under the laws of the jurisdiction of its incorporation.
(b) Boone is a federally chartered stock savings and loan
association which is a member in good standing of the Federal
Home Loan Bank of Des Moines, and the deposit accounts of Boone
are insured by the Savings Association Insurance Fund
administered by the FDIC to the maximum extent permitted by the
FDIA.
(c) The authorized capital stock of Boone consists of
2,500,000 shares of Boone Common Stock. All of the outstanding
shares of Boone Common Stock have been duly authorized and
validly issued and (assuming receipt of the consideration
provided for in the Association's Plan of Conversion) are fully
paid and nonassessable, and the shareholders of Boone have no
preemptive rights with respect to any shares of capital stock of
Boone. All of the outstanding shares of capital stock of the
Boone Subsidiary have been duly authorized and validly issued,
are fully paid and nonassessable, and, to the knowledge of such
counsel, and except as Previously Disclosed, are directly or
indirectly owned by Boone free and clear of all liens, claims,
encumbrances, charges, restrictions or rights of third parties of
any kind whatsoever. To such counsel's knowledge, except (i) for
options to purchase [10,229] shares of Boone Common Stock
pursuant to the Boone Stock Option Plan which are outstanding as
of the date hereof, neither Boone nor the Boone Subsidiary has or
is bound by any outstanding subscriptions, options, warrants,
calls, commitments or agreements of any character calling for the
transfer, purchase or issuance of any shares of capital stock of
Boone or of the Boone Subsidiary or any securities representing
the right to purchase or otherwise receive any shares of such
capital stock or any securities convertible into or representing
the right to purchase or subscribe for any such stock.
(d) The Agreement and the Plan of Merger have been duly
authorized, executed and delivered by Boone and constitute valid
and binding obligations of Boone enforceable in accordance with
their terms, except that the enforceability of the obligations of
Boone may be limited by (i) receivership or conservatorship,
insolvency, moratorium, reorganization or similar laws affecting
the rights of creditors, (ii) equitable principles limiting the
right to obtain specific performance or other similar equitable
relief and (iii) considerations of public policy, and except that
certain remedies may not be available in the case of a
nonmaterial breach of the Agreement and the Plan of Merger.
(e) All corporate and shareholder actions required to be
taken by Boone by law and the Charter and Bylaws of Boone to
authorize the execution and delivery of the Agreement and the
Plan of Merger and consummation of the Merger have been taken.
(f) All permits, consents, waivers, clearances, approvals
and authorizations of any regulatory or governmental body which
are necessary to be obtained by Boone to permit the execution,
delivery and performance of the Agreement and the Plan of Merger
and consummation of the Merger have been obtained.
(g) Assuming due authorization of the Merger by all
necessary partnership, corporate and governmental proceedings on
the part of Jones and Interim and that Jones and Interim have
taken all action required to be taken by them prior to the
Effective Time, (i) the Merger will be validly consummated in
accordance with the Agreement, the Plan of Merger and applicable
laws and regulations, and (ii) each outstanding share of Boone
Common Stock and each option to purchase shares of Boone Common
Stock will be converted in the manner specified in the Plan of
Merger.
(h) To such counsel's knowledge, and except as Previously
Disclosed, there are no material legal or governmental
proceedings pending to which Boone or the Boone Subsidiary is a
party or to which any property of Boone or the Boone Subsidiary
is subject and no such proceedings are threatened by governmental
authorities or by others.
Such counsel participated in conferences with management of,
and the independent public accountants for, the Association and
representatives of Jones and its counsel and while counsel has
not undertaken to independently verify, and does not assume
responsibility for, the accuracy, completeness or fairness of the
statements contained in the Proxy Statement, such counsel may
state that based on such conferences nothing has come to its
attention to cause it to believe that the information in the
Proxy Statement (other than information relating to Jones
provided by Jones in writing and included in the Proxy
Statement), as of the date(s) such Proxy Statement was mailed to
shareholders of Boone and up to and including the date(s) of the
meeting of shareholders to which such Proxy Statement relates,
contained any untrue statement of a material fact or omitted to
state a material fact necessary to make the statements therein,
in light of the circumstances under which they were made, not
misleading.
In rendering their opinion, such counsel may rely, to the
extent such counsel deems such reliance necessary or appropriate,
upon certificates of governmental officials and, as to matter of
fact, certificates of officers of Boone or the Boone Subsidiary.
The opinion of such counsel need refer only to matters of
Missouri and federal law, may rely upon counsel reasonably
satisfactory to Jones on matters of Missouri law (or,
alternatively, provide for the delivery of an opinion of local
counsel with respect to such matters). Such counsel may
expressly exclude any opinions as to choice of law matters and
anti-trust matters and may add such other qualifications and
explanations of its opinions as are consistent with the Legal
Opinion Accord prepared by the Section of Business Law of the
American Bar Association.
<TABLE> <S> <C>
<ARTICLE> BD
<LEGEND>
This schedule contains summary financial information extracted from the
financial statements for Edward D. Jones & Co. for the quarter ended September
30, 1994 and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<RESTATED>
<CIK> 0000815917
<NAME> JONES FINANCIAL COMPANIES L P
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> QTR-3
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-START> JUN-27-1994
<PERIOD-END> SEP-30-1994
<EXCHANGE-RATE> 1
<CASH> 32,677
<RECEIVABLES> 508,363
<SECURITIES-RESALE> 0
<SECURITIES-BORROWED> 10,508
<INSTRUMENTS-OWNED> 227,262
<PP&E> 123,655
<TOTAL-ASSETS> 944,428
<SHORT-TERM> 230,000
<PAYABLES> 233,571
<REPOS-SOLD> 0
<SECURITIES-LOANED> 3,390
<INSTRUMENTS-SOLD> 15,442
<LONG-TERM> 178,920
<COMMON> 0
0
0
<OTHER-SE> 181,211
<TOTAL-LIABILITY-AND-EQUITY> 944,428
<TRADING-REVENUE> 0
<INTEREST-DIVIDENDS> 35,574
<COMMISSIONS> 403,844
<INVESTMENT-BANKING-REVENUES> 26,600
<FEE-REVENUE> 24,570
<INTEREST-EXPENSE> 17,816
<COMPENSATION> 288,684
<INCOME-PRETAX> 41,207
<INCOME-PRE-EXTRAORDINARY> 41,207
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 41,207
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
