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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) September 28, 1998
UNITED NATIONAL BANCORP
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(Exact name of registrant as specified in its charter)
New Jersey
(State or other jurisdiction of incorporation)
000-16931 22-2894827
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(Commission File Number) (IRS Employer Identification No.)
1130 Route 22 East, Bridgewater, New Jersey 08807-0010
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(Address of principal executive offices)
(908) 429-2200
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(Registrant's telephone number, including area code)
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<PAGE>
Item 5. Other Events.
United National Bancorp, United National Bank, Raritan Bancorp Inc. and The
Raritan Savings Bank amended and restated their Merger Agreement dated as of
September 22, 1998 (in particular, Section 7.1(g) thereof) in order to more
accurately reflect the parties' intentions regarding the circumstances under
which Raritan can terminate the Agreement based on a drop in United's stock
price. The Amended and Restated Merger Agreement is attached as an exhibit to
this Current Report on Form 8-K.
<PAGE>
Item 7. Exhibits.
99(a) Amended and Restatement Agreement and Plan of Merger dated
September 22, 1998 by and between United National Bancorp, United
National Bank, Raritan Bancorp Inc. and the Raritan Savings Bank
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.
UNITED NATIONAL BANCORP
Dated: September 28, 1998 By: DONALD W. MALWITZ
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Donald W. Malwitz
Vice President and Treasurer
<PAGE>
INDEX TO EXHIBITS
Exhibit No. Description
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99(a) Amendment and Restated Agreement and Plan of Merger dated
September 22, 1998 by and between United National Bancorp, United
National Bank, Raritan Bancorp Inc. and The Raritan Savings Bank
AMENDED AND RESTATED AGREEMENT AND PLAN OF MERGER
THIS AMENDED AND RESTATED AGREEMENT AND PLAN OF MERGER, dated
as of September 22, 1998 ("Agreement"), is among United National Bancorp, a New
Jersey corporation and registered bank holding company ("United"), United
National Bank, a national banking association ("UNB"), Raritan Bancorp Inc., a
Delaware corporation and registered bank holding company ("Raritan") and The
Raritan Savings Bank, a New Jersey-chartered stock savings bank (the "Bank").
RECITALS
United desires to acquire Raritan and Raritan's Board of
Directors has determined, based upon the terms and conditions hereinafter set
forth, that the acquisition is in the best interests of Raritan and its
stockholders. The acquisition will be accomplished by merging Raritan into
United with United as the surviving corporation and, at the same time, merging
the Bank into UNB with UNB as the surviving bank, and Raritan stockholders
receiving the consideration hereinafter set forth. The Boards of Directors of
Raritan, United, the Bank and UNB have duly adopted and approved this Agreement
and the Board of Directors of Raritan has directed that it be submitted to its
stockholders for approval.
As a condition precedent to entering into this Agreement,
United has required that Raritan grant it an option to purchase authorized but
unissued shares of Raritan common stock and, as a consequence, United and
Raritan have entered into a Stock Option Agreement, dated the date hereof (the
"United Stock Option").
NOW, THEREFORE, intending to be legally bound, the parties
hereto agree as follows:
ARTICLE I
THE MERGER
1.1. The Merger. Subject to the terms and conditions of this
Agreement, at the Effective Time (as hereafter defined), Raritan shall be merged
with and into United (the "Merger") in accordance with the New Jersey Business
Corporation Act ("NJBCA") and the Delaware General Corporation Law ("DGCL") and
United shall be the surviving corporation (the "Surviving Corporation").
Immediately following the Effective Time, the Bank shall be merged with and into
UNB as provided in Section 1.7 hereof.
1.2. Effect of the Merger. At the Effective Time (as hereafter
defined), the Surviving Corporation shall be considered the same business and
corporate entity as each of Raritan and United and thereafter all the property,
rights, powers and franchises of each of Raritan and United shall vest in the
Surviving Corporation and the Surviving Corporation shall be subject to and be
deemed to have assumed all of the debts, liabilities, obligations and duties of
each of Raritan and United and shall have succeeded to all of each of their
relationships, fiduciary or otherwise, as fully and to the same extent as if
such property, rights, privileges, powers, franchises, debts, obligations,
duties and relationships had been originally acquired, incurred or entered into
by the Surviving Corporation.
1.3. Certificate of Incorporation. The certificate of
incorporation of United as it exists immediately prior to the Effective Time
shall not be amended by the Merger, but shall continue as the certificate of
incorporation of the Surviving Corporation until otherwise amended as provided
by law.
1.4. Bylaws. The bylaws of United as they exist immediately
prior to the Effective Date shall continue as the by-laws of the Surviving
Corporation until otherwise amended as provided by law.
1.5. Directors and Officers. The directors and officers of
United as of the Effective Time shall continue as the directors and officers of
the Surviving Corporation, with the additions provided for in Section 5.15
hereof.
1.6 Closing Date, Closing and Effective Time; Determination
Date. Unless a different date, time and/or place are agreed to by the parties
hereto, the closing of the Merger (the "Closing") shall take place at 10:00
a.m., at the office of Pitney, Hardin, Kipp & Szuch, Florham Park, New Jersey,
on a date (the "Closing Date") which shall be the fifth business day following
the first date (the "Determination Date") on which all necessary regulatory and
governmental approvals and consents have been received, all statutory waiting
periods in respect thereof have expired, and all other conditions to the
consummation of the Merger specified in Article VI hereof (other than the
delivery of certificates, opinions and other instruments and documents to be
delivered at the Closing) have been satisfied or waived, or at such other place,
time or date as United and Raritan may mutually agree upon. The Merger shall
become effective (and be consummated) upon the effective time (the "Effective
Time") specified by United and Raritan in the certificates of merger (the
"Certificates of Merger"), which shall be prepared by United, shall be in form
and substance satisfactory to United and Raritan, and shall be filed with the
Secretary of State of the State of New Jersey and with the Secretary of State of
the State of Delaware. The parties currently anticipate that the Certificates of
Merger shall specify as the effective time the close of business on the Closing
Date. If no effective time is specified in the Certificates of Merger, the
Merger shall become effective (and be consummated) upon the later to be filed of
the two Certificates of Merger.
1.7. The Bank Merger. Immediately following the Effective
Time, the Bank shall be merged with and into UNB (the "Bank Merger") in
accordance with the provisions of the National Bank Act and the New Jersey
Banking Act of 1948, as amended, and UNB shall be the surviving bank (the
"Surviving Bank"). Upon the consummation of the Bank Merger, the separate
existence of the Bank shall cease and the Surviving Bank shall be considered the
same business and corporate entity as each of the Bank and UNB and all of the
property, rights, powers and franchises of each of the Bank and UNB shall vest
in the Surviving Bank and the Surviving Bank shall be deemed to have assumed all
of the debts, liabilities, obligations and duties of each of the Bank and UNB
and shall have succeeded to all of each of their relationships, fiduciary or
otherwise, as fully and to the same extent as if such property, rights,
privileges, powers, franchises, debts, obligations, duties and relationships had
been originally acquired, incurred or entered into by the Surviving Bank. Upon
the consummation of the Bank Merger, the articles of association and bylaws of
UNB shall become the articles of association and bylaws of the Surviving Bank,
the officers and employees of UNB and the officers and employees of the Bank
shall be the officers and employees of the Surviving Bank with such additions as
the Board of Directors of UNB shall determine, and the directors of UNB shall be
the directors of the Surviving Bank with the additions from the directors of
Raritan as specified herein. In connection with the execution of this Agreement,
the Bank and UNB shall execute and deliver a separate merger agreement (the
"Bank Merger Agreement") in substantially the form of Exhibit A, annexed hereto,
for delivery to the appropriate regulatory authorities for approval of the Bank
Merger.
ARTICLE II
CONVERSION OF RARITAN COMMON STOCK AND OPTIONS
Each share of common stock, $.01 par value, of Raritan
("Raritan Common Stock"), issued and outstanding immediately prior to the
Effective Time, and each option to purchase shares of Raritan Common Stock
validly issued pursuant to the 1993 Stock Option Plan for Outside Directors, the
1993 Incentive Stock Option Plan or the 1997 Long-Term Incentive Stock Benefit
Plan (together, the "Raritan Option Plans") and outstanding immediately prior to
the Effective Time and listed on Section 3.2 of the Raritan Disclosure Schedule
(each a "Raritan Option") shall, by virtue of the Merger and without any action
on the part of the holder thereof, be converted or cancelled at the Effective
Time in accordance with this Article II.
2.1 Conversion of Raritan Common Stock; Exchange Ratio; Cash
in Lieu of Fractional Shares. Each share of Raritan Common Stock issued and
outstanding immediately prior to the Effective Time, other than shares to be
cancelled pursuant to Section 2.4 hereof, shall be converted into the right to
receive 1.45 (the "Exchange Ratio") shares of Common Stock, $1.25 par value, of
United ("United Common Stock"), subject to adjustment as set forth in Section
2.6 below. No fractional shares of United Common Stock shall be issued pursuant
to the Merger, and, in lieu thereof, each holder of Raritan Common Stock who
would otherwise be entitled to a fractional interest will receive an amount in
cash determined by multiplying such fractional interest by the Average
Pre-Closing Price of United Common Stock. The "Average Pre-Closing Price of
United Common Stock" means the average of the "Closing Prices" (as hereinafter
defined) of United Common Stock for the ten consecutive full trading days ending
on (and including) the Determination Date. "Closing Price" on any trading day
shall mean the closing price of United Common Stock on such day as supplied by
the Nasdaq Stock Market, National Market System ("NASDAQ/NMS") (and reported in
The Wall Street Journal or, if not reported thereby, another authoritative
source as chosen by United). A "trading day" shall mean any business day on
which United Common Stock is actually traded on NASDAQ/NMS.
2.2. Exchange of Shares.
(a) Raritan and United hereby appoint The Bank of New York, or
such other bank as United (with the consent of Raritan, which consent shall not
be unreasonably withheld) shall designate, as the exchange agent (the "Exchange
Agent") for purposes of effecting the conversion of Raritan Common Stock and
Raritan Options. As soon as practicable after the Effective Time, but no later
than five business days after the Effective Time, the Exchange Agent shall mail
to each holder of record (a "Record Holder") of a Certificates or Certificates
which, immediately prior to the Effective Time represented outstanding shares of
Raritan Common Stock (the "Certificates"), a mutually agreed upon letter of
transmittal (which shall specify that delivery shall be effected, and risk of
loss and title to the Certificates shall pass, only upon delivery of the
Certificates to the Exchange Agent), and instructions for use in effecting the
surrender of the Certificates in exchange for United Common Stock (and cash in
lieu of fractional shares) as provided in Section 2.1 hereof.
(b) Upon surrender of Certificates for exchange and
cancellation to the Exchange Agent, together with such letter of transmittal,
duly executed, the Record Holder shall be entitled to promptly receive in
exchange for such Certificates the consideration as provided in Section 2.1
hereof and the Certificates so surrendered shall be canceled. The Exchange Agent
shall not be obligated to deliver or cause to be delivered to any Record Holder
the consideration to which such Record Holder would otherwise be entitled until
such Record Holder surrenders the Certificates for exchange or, in default
thereof, an appropriate Affidavit of Loss and Indemnity Agreement and/or a bond
as may be reasonably required in each case by United. Notwithstanding the time
of surrender of the Certificates, Record Holders shall be deemed stockholders of
United for all purposes from the Effective Time, except that United shall
withhold the payment of dividends from any Record Holder until such Record
Holder effects the exchange of Certificates for United Common Stock. (Such
Record Holder shall receive such withheld dividends, without interest, upon
effecting the share exchange.)
(c) After the Effective Time, there shall be no transfers on
the stock transfer books of Raritan of the shares of Raritan Common Stock which
were outstanding immediately prior to the Effective Time and, if any
Certificates representing such shares are presented for transfer, they shall be
canceled and exchanged for the consideration as provided in Section 2.1 hereof.
(d) If payment of the consideration pursuant to Section 2.1
hereof is to be made in a name other than that in which the Certificates
surrendered in exchange therefor is registered, it shall be a condition of such
payment that the Certificates so surrendered shall be properly endorsed (or
accompanied by an appropriate instrument of transfer) and otherwise in proper
form for transfer, and that the person requesting such payment shall pay to the
Exchange Agent in advance any transfer or other taxes required by reason of the
payment to a person other than that of the registered holder of the Certificates
surrendered, or required for any other reason, or shall establish to the
satisfaction of the Exchange Agent that such tax has been paid or is not
payable.
(e) With respect to each outstanding Raritan Option the
Exchange Agent shall, after the Effective Time, distribute to the Optionee an
amendment to the option grant evidencing the conversion of the grant to an
option to purchase United Common Stock in accordance with Section 2.7 hereof.
2.3. No Dissenters' Rights. Consistent with the provisions of
the DGCL, no stockholder of Raritan shall have appraisal rights with respect to
the Merger.
2.4. Cancelled Shares. Each share of Raritan Common Stock (i)
which is held by Raritan as treasury stock or (ii) which is held by Bank or any
other direct or indirect subsidiary of Bank (except as trustee or in a fiduciary
capacity) or (iii) which is held by United, shall be canceled and retired at the
Effective Time.
2.5. United Shares. The shares of United Common Stock
outstanding at the Effective Time shall not be affected by the Merger, but along
with the additional shares of United Common Stock to be issued as provided in
Section 2.1 hereof, shall become the outstanding common stock of the Surviving
Corporation.
2.6 Anti-Dilution Adjustments. The Exchange Ratio and the
Average Pre-Closing Price of United Common Stock shall be appropriately adjusted
for any stock split, stock dividend, stock combination, reclassification or
similar transaction ("Capital Change") effected by United with respect to United
Common Stock between the date hereof and the Effective Time. By way of
illustration, the Exchange Ratio determined pursuant to Section 2.1 hereof shall
be adjusted upward by 10% (to 1.595) upon the payment of the 10% stock dividend
which United declared on September 15, 1998 and which is payable on November 2,
1998 to United shareholders of record as of October 15, 1998. In addition, if
United enters into an agreement pursuant to which shares of United Common Stock
would be converted, prior to the Effective Time, into shares or other securities
or obligations of another corporation, proper provision shall be made in such
agreement so that each Raritan stockholder shall be entitled to receive at the
Effective Time such number of shares or other securities or amount of
obligations of such other corporation as such stockholder would be entitled to
receive if the Effective Time had occurred immediately prior to the consummation
of such conversion.
2.7. Raritan Stock Options. At the Effective Time, each
outstanding Raritan Option held by any person (an "Optionee") under the Raritan
Option Plans shall be converted into a option to purchase United Common Stock (a
"Stock Option"), wherein (x) the right to purchase shares of Raritan Common
Stock pursuant to the Raritan Option shall be converted into the right to
purchase that same number of shares of United Common Stock multiplied by the
Exchange Ratio, (y) the option exercise price per share of United Common Stock
shall be the previous option exercise price per share of Raritan Common Stock
divided by the Exchange Ratio and (z) in all other material respects the option
shall be subject to the same terms and conditions as governed the Raritan Option
on which it was based, including the length of time within which the option may
be exercised and for any options which are "incentive stock options" (as defined
in Section 422 of the Internal Revenue Code of 1986, as amended (the "Code")),
the adjustments shall be and are intended to be effected in a manner which is
consistent with Section 424(a) of the Code. Shares of United Common Stock
issuable upon exercise of Stock Options shall be covered by an effective
registration statement on Form S-8, and United shall file a registration
statement on Form S-8 covering such shares as soon as practicable after the
Effective Time, but in no event later than 45 days after the Effective Time.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF RARITAN
References herein to "Raritan Disclosure Schedule" shall mean
all of the disclosure schedules required by this Article III, dated as of the
date hereof and referenced to the specific sections and subsections of Article
III of this Agreement, which have been delivered on the date hereof by Raritan
to United. Raritan hereby represents and warrants to United as follows:
3.1. Corporate Organization.
(a) Raritan is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware. Raritan has the
corporate power and authority to own or lease all of its properties and assets
and to carry on its business as it is now being conducted and is duly licensed
or qualified to do business in each jurisdiction in which the nature of the
business conducted by it or the character or location of the properties and
assets owned or leased by it makes such licensing or qualification necessary,
except where the failure to be so licensed or qualified would not have a
material adverse effect on the business, operations, assets or financial
condition of Raritan on a consolidated basis. Raritan is registered as a bank
holding company under the Bank Holding Company Act of 1956, as amended ("BHCA").
(b) Each of the Subsidiaries of Raritan are listed in the
Raritan Disclosure Schedule. The term "Subsidiary", when used in this Agreement
with respect to Raritan, means any corporation, joint venture, association,
partnership, trust or other entity in which Raritan has, directly or indirectly
at least a 50% interest or acts as a general partner. Each Subsidiary of Raritan
is duly organized, validly existing and in good standing under the laws of its
state of incorporation. The Bank is a New Jersey-chartered stock savings bank
whose deposits are insured to the fullest extent permitted by law by the Savings
Association Insurance Fund of the Federal Deposit Insurance Corporation ("SAIF")
for certain deposits, and by the Bank Insurance Fund of the FDIC (the "BIF") for
the remaining deposits, in each case to the fullest extent permitted by law.
Each Subsidiary of Raritan has the corporate power and authority to own or lease
all of its properties and assets and to carry on its business as it is now being
conducted and is duly licensed or qualified to do business in each jurisdiction
in which the nature of the business conducted by it or the character or location
of the properties and assets owned or leased by it makes such licensing or
qualification necessary, except where the failure to be so licensed or qualified
would not have a material adverse effect on the business, operations, assets or
financial condition of Raritan and its Subsidiaries on a consolidated basis. The
Raritan Disclosure Schedule sets forth true and complete copies of the
Certificates of Incorporation or Charter, as the case may be, and Bylaws of
Raritan and each Raritan Subsidiary as in effect on the date hereof. Except as
set forth in the Raritan Disclosure Schedule, Raritan does not own or control,
directly or indirectly, any equity interest in any corporation, company,
association, partnership, joint venture or other entity and owns no real estate,
except (i) residential real estate acquired through foreclosure or deed in lieu
of foreclosure in each individual instance with a fair market value less than
$500,000 and (ii) real estate used for its banking premises.
3.2. Capitalization.
The authorized capital stock of Raritan consists of 3,500,000
shares of Raritan Common Stock and 2,00,000 shares of preferred stock, $.01 par
value per share ("Raritan Preferred Stock"). As of the date hereof, there were
2,373,569 shares of Raritan Common Stock issued and outstanding, and 214,405
shares issued and held in the treasury, and no shares of Raritan Preferred Stock
outstanding. As of the date hereof, there were 264,812 shares of Raritan Common
Stock issuable upon exercise of outstanding Raritan Options (the "Option
Shares") granted to, directors and officers of Raritan or the Bank pursuant to
the Raritan Option Plans. The Raritan Disclosure Schedule sets forth (i) all
options which may be exercised for issuance of Raritan Common Stock and the
terms upon which the options may be exercised, and (ii) true and complete copies
of each of the Raritan Option Plans and a specimen of each form of agreement
pursuant to which any outstanding stock option was granted, including a list of
each outstanding stock option issued pursuant thereto. All issued and
outstanding shares of Raritan Common Stock, and all issued and outstanding
shares of capital stock of each Raritan Subsidiary, have been duly authorized
and validly issued, are fully paid, and nonassessable. The authorized capital
stock of the Bank consists of 10,000,000 shares of common stock, $2.00 par value
and no shares of preferred stock. All of the outstanding shares of capital stock
of each Raritan Subsidiary are owned by Raritan and are free and clear of any
liens, encumbrances, charges, restrictions or rights of third parties. Except
for the Raritan Options and the United Stock Option, neither Raritan nor any
Raritan 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 Raritan or any
Raritan 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 shares, and
there are no agreements or understandings with respect to voting of any such
shares.
3.3. Authority; No Violation.
(a) Subject to the approval of this Agreement and the
transactions contemplated hereby by the stockholders of Raritan, and subject to
the parties obtaining all necessary regulatory approvals, Raritan and the Bank
have full corporate power and authority to execute and deliver this Agreement
and to consummate the transactions contemplated hereby in accordance with the
terms hereof. The execution and delivery of this Agreement and the consummation
of the transactions contemplated hereby have been duly and validly approved by
the Board of Directors of each of Raritan and the Bank. The execution and
delivery of the Bank Merger Agreement has been duly and validly approved by the
Board of Directors of the Bank. Except for the approvals described in paragraph
(b) below, no other corporate proceedings on the part of Raritan or the Bank are
necessary to consummate the transactions contemplated hereby. This Agreement has
been duly and validly executed and delivered by Raritan and the Bank, and
constitutes valid and binding obligations of Raritan and the Bank, enforceable
against Raritan and the Bank in accordance with its terms, except to the extent
that enforcement may be limited by (i) bankruptcy, insolvency, reorganization,
moratorium, conservatorship, receivership or other similar laws now or hereafter
in effect relating to or affecting the enforcement of creditors' rights
generally or the rights of creditors of New Jersey-chartered savings banks, (ii)
general equitable principles, and (iii) laws relating to the safety and
soundness of insured depository institutions and except that no representation
is made as to the effect or availability of equitable remedies or injunctive
relief.
(b) Neither the execution and delivery of this Agreement by
Raritan and the Bank, nor the consummation by Raritan and the Bank of the
transactions contemplated hereby in accordance with the terms hereof, or
compliance by Raritan and the Bank with any of the terms or provisions hereof,
will (i) violate any provision of Raritan's or the Bank's Certificates of
Incorporation or Charter, as the case may be, or Bylaws, (ii) assuming that the
consents and approvals set forth below are duly obtained, violate any statute,
code, ordinance, rule, regulation, judgment, order, writ, decree or injunction
applicable to Raritan or the Bank or any of their respective properties or
assets, or (iii) except as set forth in the Raritan Disclosure Schedule,
violate, conflict with, result in a breach of any provisions of, constitute a
default (or an event which, with notice or lapse of time, or both, would
constitute a default) under, result in the termination of, accelerate the
performance required by, or result in the creation of any lien, security
interest, charge or other encumbrance upon any of the respective properties or
assets of Raritan or the Bank under, any of the terms, conditions or provisions
of any note, bond, mortgage, indenture, deed of trust, license, lease, agreement
or other instrument or obligation to which Raritan or the Bank is a party, or by
which either or both of them or any of their respective properties or assets may
be bound or affected except, with respect to (ii) and (iii) above, such as
individually and in the aggregate will not have a material adverse effect on the
business, operations, assets or financial condition of Raritan and its
Subsidiaries on a consolidated basis, and which will not prevent or delay the
consummation of the transactions contemplated hereby. Except for consents and
approvals of or filings or registrations with or notices to the OCC, the
Commissioner of Banking and Insurance of the State of New Jersey (together with
the Department of Banking and Insurance, the "Commissioner"), the Board of
Governors of the Federal Reserve System ("FRB"), the Securities and Exchange
Commission ("SEC"), applicable state securities bureaus or commissions, the New
Jersey Secretary of State, the Delaware Secretary of State, and the stockholders
of Raritan, no consents or approvals of or filings or registrations with or
notices to any third party or any public body or authority are necessary on
behalf of Raritan or the Bank in connection with (x) the execution and delivery
by Raritan and the Bank of this Agreement and (y) the consummation by Raritan
and the Bank of the transactions contemplated hereby and (z) the execution and
delivery by the Bank of the Bank Merger Agreement and the consummation by the
Bank of the transactions contemplated thereby.
3.4. Financial Statements.
(a) The Raritan Disclosure Schedule sets forth copies of the
consolidated statements of condition of Raritan as of December 31, 1995, 1996
and 1997, and the related consolidated statements of income, stockholders'
equity and cash flows for the periods ended December 31 in each of the three
years 1995 through 1997, in each case accompanied by the audit report of KPMG
Peat Marwick LLP, independent public accountants with respect to Raritan, and
the unaudited consolidated statements of condition of Raritan as of June 30,
1998 and related unaudited consolidated statements of income, changes in
stockholders' equity and cash flows for the six months then ended as reported in
Raritan's Quarterly Report on Form 10-Q, filed with the SEC under the Securities
and Exchange Act of 1934, as amended (the "1934 Act") (collectively, the
"Raritan Financial Statements"). The Raritan Financial Statements (including the
related notes) have been prepared in accordance with generally accepted
accounting principles ("GAAP") consistently applied during the periods involved,
and fairly present the consolidated financial condition of Raritan as of the
respective dates set forth therein, and the related consolidated statements of
income, stockholders' equity and cash flows fairly present the results of the
consolidated operations, stockholders' equity and cash flows of Raritan for the
respective periods set forth therein.
(b) The books and records of Raritan and its Subsidiaries have
been and are being maintained in material compliance with applicable legal and
accounting requirements, and reflect only actual transactions.
(c) Except as and to the extent reflected, disclosed or
reserved against in the Raritan Financial Statements (including the notes
thereto), as of June 30, 1998 neither Raritan nor any of its Subsidiaries had
any material liabilities, whether absolute, accrued, contingent or otherwise
material to the business, operations, assets or financial condition of Raritan
or any of its Subsidiaries. Since June 30, 1998 and to the date hereof, neither
Raritan nor any of its Subsidiaries have incurred any material liabilities
except in the ordinary course of business and consistent with prudent banking
practice, except as specifically contemplated by this Agreement.
3.5. Brokerage Fees; Financial Advisor. Other than The
Endicott Financial Advisors, L.L.C. ("Endicott"), neither Raritan nor any of its
Subsidiaries nor any of their respective directors or officers has employed any
broker or finder or incurred any liability for any broker's or finder's fees or
commissions in connection with any of the transactions contemplated by this
Agreement. Copies of Raritan's agreements with Endicott are set forth in the
Raritan Disclosure Schedule. Endicott has delivered to Raritan its written
opinion with respect to the fairness, from a financial point of view, of the
Exchange Ratio to the shareholders of Raritan in the Merger. There are no fees
(other than time charges billed at usual and customary rates) payable to any
consultants, including lawyers and accountants, in connection with this
transaction or which would be triggered by consummation of this transaction or
the termination of the services of such consultants by Raritan or any of its
Subsidiaries other than fees which will be payable by Raritan to Endicott.
3.6. Absence of Certain Changes or Events.
(a) There has not been any material adverse change in the
business, operations, assets or financial condition of Raritan and its
Subsidiaries on a consolidated basis since June 30, 1998 and, to Raritan's
knowledge, no facts or conditions exist (other than regional or national
economic conditions which affect financial institutions generally) which Raritan
believes will cause or is likely to cause such a material adverse change in the
future.
(b) Except as set forth in the Raritan Disclosure Schedule,
neither Raritan nor any of its Subsidiaries has taken or permitted any of the
actions set forth in Section 5.2 hereof between June 30, 1998 and the date
hereof and Raritan and the Raritan Subsidiaries have conducted their business
only in the ordinary course, consistent with past practice.
3.7. Legal Proceedings. Except as disclosed in the Raritan
Disclosure Schedule, neither Raritan nor any of its Subsidiaries is a party to
any, and there are no pending or, to Raritan's knowledge, threatened, legal,
administrative, arbitral or other proceedings, claims, actions or governmental
investigations of any nature ("Legal Proceedings") against Raritan or any of its
Subsidiaries. Except as disclosed in the Raritan Disclosure Schedule, neither
Raritan nor any of its Subsidiaries is a party to any order, judgment or decree
entered against Raritan or any Raritan Subsidiary in any Legal Proceeding.
3.8. Taxes and Tax Returns.
(a) Raritan and each Raritan Subsidiary have duly filed (and
until the Effective Time will so file) all returns, declarations, reports,
information returns and statements ("Returns") required to be filed by them in
respect of any federal, state and local taxes (including withholding taxes,
penalties or other payments required) and each has duly paid (and until the
Effective Time will so pay) all such taxes due and payable, other than taxes or
other charges which are being contested in good faith (and disclosed to United
in writing). Raritan and each Raritan Subsidiary have established (and until the
Effective Time will establish) on their books and records reserves for the
payment of all federal, state and local taxes not yet due and payable, but
incurred in respect of Raritan or any Raritan Subsidiary through such date,
which reserves are, to the knowledge of Raritan, adequate for such purposes.
Except as set forth in the Raritan Disclosure Schedule, the federal income tax
returns of Raritan and its Subsidiaries have been examined by the Internal
Revenue Service (the "IRS") (or are closed to examination due to the expiration
of the applicable statute of limitations) and no deficiencies were asserted as a
result of such examinations which have not been resolved and paid in full.
Except as set forth in the Raritan Disclosure Schedule, the applicable state
income tax returns of Raritan and its Subsidiaries have been examined by the
applicable authorities (or are closed to examination due to the expiration of
the statute of limitations) and no deficiencies were asserted as a result of
such examinations which have not been resolved and paid in full. To the
knowledge of Raritan, there are no audits or other administrative or court
proceedings presently pending nor any other disputes pending, or claims asserted
for, taxes or assessments upon Raritan or any of its Subsidiaries, nor has
Raritan or any of its Subsidiaries given any currently outstanding waivers or
comparable consents regarding the application of the statute of limitations with
respect to any taxes or Returns.
(b) Except as set forth in the Raritan Disclosure Schedule,
neither Raritan nor any of its Subsidiaries (i) has requested any extension of
time within which to file any tax Return which Return has not since been filed,
(ii) is a party to any agreement providing for the allocation or sharing of
taxes, (iii) is required to include in income any adjustment pursuant to Section
481(a) of the Code, by reason of a voluntary change in accounting method
initiated by Raritan or any Raritan Subsidiary (nor does Raritan have any
knowledge that the IRS has proposed any such adjustment or change of accounting
method) or (iv) has filed a consent pursuant to Section 341(f) of the Code or
agreed to have Section 341(f)(2) of the Code apply.
3.9. Employee Benefit Plans.
(a) Except as disclosed in the Raritan Disclosure Schedule,
neither Raritan nor any of its Subsidiaries maintains or contributes to any
"employee pension benefit plan", within the meaning of Section 3(2)(A) of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA") (the
"Raritan Pension Plans"), "employee welfare benefit plan", within the meaning of
Section 3(1) of ERISA (the "Raritan Welfare Plans"), stock option plan, stock
purchase plan, deferred compensation plan, severance plan, bonus plan,
employment agreement or other similar plan, program or arrangement. Neither
Raritan nor any of its Subsidiaries has, since September 2, 1974, contributed to
any "Multiemployer Plan", within the meaning of Sections 3(37) and 4001(a)(3) of
ERISA.
(b) Raritan has delivered to United in the Raritan Disclosure
Schedule a complete and accurate copy of each of the following with respect to
each of the Raritan Pension Plans and Raritan Welfare Plans: (i) plan document,
summary plan description, and summary of material modifications (if not
available, a detailed description of the foregoing); (ii) trust agreement or
insurance contract, if any; (iii) most recent IRS determination letter, if any;
(iv) most recent actuarial report, if any; and (v) most recent annual report on
Form 5500.
(c) The present value of all accrued benefits both vested and
non-vested under each of the Raritan Pension Plans subject to Title IV of ERISA,
based upon the actuarial assumptions used for purposes of the most recent
actuarial valuation prepared by such Raritan Pension Plan's actuary, did not
exceed the then current value of the assets of such plans allocable to such
accrued benefits. To the best of Raritan's knowledge, the actuarial assumptions
then utilized for such plans were reasonable and appropriate as of the last
valuation date and reflect then current market conditions.
(d) During the last six years, the Pension Benefit Guaranty
Corporation (the "PBGC") has not asserted any claim for liability against
Raritan or any of its Subsidiaries which has not been paid in full.
(e) All premiums (and interest charges and penalties for late
payment, if applicable) due to the PBGC with respect to each Raritan Pension
Plan have been paid. All contributions required to be made to each Raritan
Pension Plan under the terms thereof, ERISA or other applicable law have been
timely made, and all amounts properly accrued to date as liabilities of Raritan
and its Subsidiaries which have not been paid have been properly recorded on the
books of Raritan and its Subsidiaries.
(f) Except as disclosed on the Raritan Disclosure Schedule,
each of the Raritan Pension Plans, the Raritan Welfare Plans and each other plan
and arrangement identified on the Raritan Disclosure Schedule has been operated
in compliance in all material respects with the provisions of ERISA, the Code,
all regulations, rulings and announcements promulgated or issued thereunder, and
all other applicable governmental laws and regulations. Furthermore, the IRS has
issued a favorable determination letter, which takes into account the Tax Reform
Act of 1986 and subsequent legislation through the date of such determination
letter, with respect to each of the Raritan Pension Plans and Raritan is not
aware of any fact or circumstance which would disqualify any such plan, that
could not be retroactively corrected (in accordance with the procedures of the
IRS).
(g) To the knowledge of Raritan, within the past two plan
years no non-exempt prohibited transaction, within the meaning of Section 4975
of the Code or Section 406 of ERISA, has occurred with respect to any of the
Raritan Welfare Plans or Raritan Pension Plans.
(h) No Raritan Pension Plan or any trust created thereunder
has been terminated, nor have there been any "reportable events", within the
meaning of Section 4034(b) of ERISA, with respect to any of the Raritan Pension
Plans.
(i) To the knowledge of Raritan, no "accumulated funding
deficiency", within the meaning of Section 412 of the Code, has been incurred
with respect to any of the Raritan Pension Plans.
(j) There are no pending, or, to the knowledge of Raritan,
threatened or anticipated claims (other than routine claims for benefits) by, on
behalf of or against any of the Raritan Pension Plans or the Raritan Welfare
Plans, any trusts related thereto or any other plan or arrangement identified in
the Raritan Disclosure Schedule.
(k) Except as disclosed in the Raritan Disclosure Schedule, no
Raritan Pension or Welfare Plan provides medical or death benefits (whether or
not insured) beyond an employee's retirement or other termination of service,
other than (i) coverage mandated by law, or (ii) death benefits under any
Raritan Pension Plan.
(l) Except with respect to customary health, life and
disability benefits or as disclosed in the Raritan Disclosure Schedule, there
are no unfunded benefits obligations which are not accounted for by reserves
shown on the Raritan Financial Statements and established under GAAP, or
otherwise noted on such financial statements.
(m) Except as disclosed in the Raritan Disclosure Schedule,
with respect to each Raritan Pension and Welfare Plan that is funded wholly or
partially through an insurance policy, there will be no liability of Raritan or
any Raritan Subsidiary as of the Effective Time under any such insurance policy
or ancillary agreement with respect to such insurance policy in the nature of a
retroactive rate adjustment, loss sharing arrangement or other actual or
contingent liability arising wholly or partially out of events occurring prior
to the Effective Time.
(n) Except as hereafter agreed to by United in writing or as
disclosed on the Raritan Disclosure Schedule, the consummation of the
transactions contemplated by this Agreement will not (i) entitle any current or
former employee of Raritan or any Raritan Subsidiary to severance pay,
unemployment compensation or any similar payment, or (ii) accelerate the time of
payment, accelerate the vesting, or increase the amount, of any compensation or
benefits due to any current employee or former employee under any Raritan
Pension Plan or Raritan Welfare Plan.
3.10. Reports.
(a) The Raritan Disclosure Schedule lists, and as to item (i)
below Raritan has previously delivered or made available to United a complete
copy of, each (i) final registration statement, prospectus, annual, quarterly or
special report and definitive proxy statement filed by Raritan since January 1,
1995 pursuant to the Securities Act of 1933, as amended ("1933 Act"), or the
1934 Act and (ii) communication (other than general advertising materials, press
releases and dividend checks) mailed by Raritan to its shareholders as a class
since January 1, 1995.
(b) Since January 1, 1995, (i) Raritan has filed all reports
that it was required to file with the SEC under the 1934 Act, and (ii) Raritan
and the Bank each has duly filed all material forms, reports and documents which
they were required to file with each agency charged with regulating any aspect
of their business, in each case in form which was correct in all material
respects, and, subject to permission from such regulatory authorities, Raritan
promptly will deliver or make available to United accurate and complete copies
of such reports. As of their respective dates, each such form, report, or
document referred to in either of clauses (i) or (ii) above, and each final
registration statement, prospectus, annual, quarterly or special report,
definitive proxy statement or communication referred to in either of clauses (i)
or (ii) of paragraph (b) above, complied in all material respects with all
applicable statutes, rules and regulations 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 made therein, in
light of the circumstances under which they were made, not misleading; provided
that information contained in any such document as of a later date shall be
deemed to modify information as of an earlier date. The Raritan Disclosure
Schedule lists the dates of all examinations of Raritan or the Bank conducted by
either the Commissioner or the FDIC since January 1, 1995 and the dates of any
responses thereto submitted by Raritan or the Bank.
3.11. Raritan and Bank Information. The information relating
to Raritan and the Bank to be contained in the Joint Proxy Statement/Prospectus
(as defined in Section 5.6(a) hereof) to be delivered to stockholders of Raritan
and United in connection with the solicitation of their approval of this
Agreement and the transactions contemplated hereby, as of the dates the Joint
Proxy Statement/Prospectus is mailed to stockholders of Raritan and United,
respectively, and up to and including the dates of each of the meetings to which
such Joint Proxy Statement/Prospectus 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.
3.12. Compliance with Applicable Law.
(a) General. Except as set forth in the Raritan Disclosure
Schedule, each of Raritan and the Raritan Subsidiaries holds all licenses,
franchises, permits and authorizations necessary for the lawful conduct of its
business under and pursuant to each, and has complied with and is not in default
in any respect under any, applicable law, statute, order, rule, regulation,
policy and/or guideline of any federal, state or local governmental authority
relating to Raritan or any of its Subsidiaries (other than where such defaults
or non-compliances will not, alone or in the aggregate, result in a material
adverse effect on the business, operations, assets or financial condition of
Raritan and its Subsidiaries on a consolidated basis) and Raritan has not
received notice of violation of, and does not know of any violations of, any of
the above.
(b) CRA. Without limiting the foregoing, to its knowledge the
Bank has complied in all material respects with the Community Reinvestment Act
("CRA") and Raritan has received no written notice that any person or group
would object to the consummation of a merger involving the Bank due to the CRA
performance of or rating of the Bank. Except as listed on the Raritan Disclosure
Schedule to the knowledge of the Bank, no person or group has adversely
commented upon the Bank's CRA performance. The most recent CRA rating received
by the Bank was "Satisfactory."
3.13. Certain Contracts.
(a) Except as disclosed in the Raritan Disclosure Schedule
under this Section or Section 3.5, (i) neither Raritan nor any Raritan
Subsidiary is a party to or bound by any contract or understanding (whether
written or oral) with respect to the employment or termination of any present or
former officers, employees, directors or consultants and (ii) the consummation
of the transactions contemplated by this Agreement will not (either alone or
upon the occurrence of any additional acts or events) result in any payment
(whether of severance pay or otherwise) becoming due from Raritan or any Raritan
Subsidiary to any officer, employee, director or consultant thereof. The Raritan
Disclosure Schedule sets forth true and correct copies of all employment
agreements or termination agreements with officers, employees, directors, or
consultants to which Raritan or any Raritan Subsidiary is a party.
(b) Except as disclosed in the Raritan Disclosure Schedule,
(i) as of the date of this Agreement, neither Raritan nor any Raritan Subsidiary
is a party to or bound by any commitment, agreement or other instrument which
contemplates the payment by Raritan or any Raritan Subsidiary of amounts in
excess of $100,000, or which has a term extending beyond November 1, 1998 and
cannot be terminated by Raritan or its subsidiary without consent of the other
party thereto, (ii) no commitment, agreement or other instrument to which
Raritan or any Raritan Subsidiary is a party or by which any of them is bound
limits the freedom of Raritan or any Raritan Subsidiary to compete in any line
of business or with any person, and (iii) neither Raritan nor any Raritan
Subsidiary is a party to any collective bargaining agreement.
(c) Except as disclosed in the Raritan Disclosure Schedule,
neither Raritan nor any Raritan Subsidiary nor, to the knowledge of Raritan, any
other party thereto, is in default in any material respect under any material
lease, contract, mortgage, promissory note, deed of trust, loan or other
commitment or arrangement.
3.14. Properties and Insurance.
(a) Raritan and its Subsidiaries have good, and as to owned
real property marketable, title to all material assets and properties, whether
real or personal, tangible or intangible, reflected in Raritan's consolidated
balance sheet as of June 30, 1998, or owned and acquired subsequent thereto
(except to the extent that such assets and properties have been disposed of for
fair value in the ordinary course of business since June 30, 1998), subject to
no encumbrances, liens, mortgages, security interests or pledges, except (i)
those items that secure liabilities that are reflected in such balance sheet or
the notes thereto or incurred in the ordinary course of business after the date
of such balance sheet, (ii) statutory liens for amounts not yet delinquent or
which are being contested in good faith, (iii) such encumbrances, liens,
mortgages, security interests, pledges and title imperfections that are not in
the aggregate material to the business, operations, assets, and financial
condition of Raritan and its Subsidiaries taken as a whole and (iv) with respect
to owned real property, title imperfections noted in title reports delivered to
United prior to the date hereof. Raritan and its Subsidiaries as lessees have
the right under valid and subsisting leases to occupy, use, possess and control
all property leased by them in all material respects as presently occupied,
used, possessed and controlled by them.
(b) The Raritan Disclosure Schedule lists all policies of
insurance and bonds covering business operations and all insurable properties
and assets of Raritan and its Subsidiaries showing all risks insured against, in
each case under valid, binding and enforceable policies or bonds, with such
amounts and such deductibles as are specified. As of the date hereof, neither
Raritan nor any of its Subsidiaries has received any notice of cancellation or
notice of a material amendment of any such insurance policy or bond or is in
default under such policy or bond, no coverage thereunder is being disputed and
all material claims thereunder have been filed in a timely fashion.
3.15. Minute Books. The minute books of Raritan and its
Subsidiaries contain records that are accurate in all material respects of all
meetings and other corporate action held of their respective stockholders and
Boards of Directors (including committees of their respective Boards of
Directors).
3.16. Environmental Matters. Except as set forth in the
Raritan Disclosure Schedule:
(a) Neither Raritan nor any Raritan Subsidiary has
received any written notice, citation, claim, assessment, proposed assessment or
demand for abatement alleging that Raritan or such Raritan Subsidiary (either
directly or as a trustee or fiduciary, or as a successor-in-interest in
connection with the enforcement of remedies to realize the value of properties
serving as collateral for outstanding loans) is responsible for the correction
or cleanup of any condition resulting from the violation of any law, ordinance
or other governmental regulation regarding environmental matters, which
correction or cleanup would be material to the business, operations, assets or
financial condition of Raritan and the Raritan Subsidiaries taken as a whole.
Raritan has no knowledge that any toxic or hazardous substances or materials
have been emitted, generated, disposed of or stored on any real property owned
or leased by Raritan or any Raritan Subsidiary, as OREO or otherwise, or owned
or controlled by Raritan or any Raritan Subsidiary as a trustee or fiduciary
(collectively, "Properties"), in any manner that violates or, after the lapse of
time may violate, any presently existing federal, state or local law or
regulation governing or pertaining to such substances and materials.
(b) Raritan has no knowledge that any of the
Properties has been operated in any manner in the three years prior to the date
of this Agreement that violated any applicable federal, state or local law or
regulation governing or pertaining to toxic or hazardous substances and
materials, the violation of which would have a material adverse effect on the
business, operations, assets or financial condition of Raritan and the Raritan
Subsidiaries taken as a whole.
(c) To the knowledge of Raritan, there are no
underground storage tanks on, in or under any of the Properties and no
underground storage tanks have been closed or removed from any of the Properties
while the property was owned, operated or controlled by Raritan or any Raritan
Subsidiary.
3.17. Reserves. The reserve for loan and lease losses in the
June 30, 1998 Raritan Financial Statements was, to Raritan's knowledge, adequate
based upon past loan loss experiences and potential losses in the current
portfolio to cover all then known or anticipated loan losses.
3.18. No Excess Parachute Payments. Except as disclosed in the
Raritan Disclosure Schedule, no officer, director, employee or agent (or former
officer, director, employee or agent) of Raritan or any Raritan Subsidiary is
entitled now, or will or may be entitled to as a consequence of this Agreement,
the Merger or the Bank Merger, to any payment or benefit from Raritan, a Raritan
Subsidiary, United or UNB which if paid or provided would constitute an "excess
parachute payment", as defined in Section 280G of the Code or regulations
promulgated thereunder.
3.19. Year 2000 Compliance. Raritan and the Raritan
Subsidiaries have taken all reasonable steps necessary to address the software,
accounting and record keeping issues raised in order for the data processing
systems used in the business conducted by Raritan and the Raritan Subsidiaries
to be substantially Year 2000 compliant on or before the end of 1999 and, except
as set forth in the Raritan Disclosure Schedule, Raritan does not expect the
future cost of addressing such issues to be material. Neither Raritan nor any
Raritan Subsidiary has received a rating of less than satisfactory from any bank
regulatory agency with respect to Year 2000 compliance.
3.20. Agreements with Bank Regulators. Except as disclosed in
the Raritan Disclosure Schedule, neither Raritan nor any Raritan Subsidiary is a
party to any agreement or memorandum of understanding with, or a party to any
commitment letter, board resolution submitted to a regulatory authority or
similar undertaking to, or is subject to any order or directive by, or is a
recipient of any extraordinary supervisory letter from, any court, governmental
authority or other regulatory or administrative agency or commission, domestic
or foreign ("Governmental Entity") which restricts materially the conduct of its
business, or in any manner relates to its capital adequacy, its credit or
reserve policies or its management, except for those the existence of which has
been disclosed in writing to United by Raritan prior to the date of this
Agreement, nor has Raritan been advised by any Governmental Entity that it is
contemplating issuing or requesting (or is considering the appropriateness of
issuing or requesting) any such order, decree, agreement, memorandum of
understanding, extraordinary supervisory letter, commitment letter or similar
submission, except as disclosed in writing to United by Raritan prior to the
date of this Agreement. Neither Raritan nor any Raritan Subsidiary is required
by Section 32 of the Federal Deposit Insurance Act to give prior notice to a
Federal banking agency of the proposed addition of an individual to its board of
directors or the employment of an individual as a senior executive officer,
except as disclosed in writing to United by Raritan prior to the date of this
Agreement.
3.21. Disclosure. No representation or warranty contained in
Article III of this Agreement contains any untrue statement of a material fact
or omits to state a material fact necessary to make the statements herein not
misleading.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF UNITED
References herein to the "United Disclosure Schedule" shall
mean all of the disclosure schedules required by this Article IV, dated as of
the date hereof and referenced to the specific sections and subsections of
Article IV of this Agreement, which have been delivered on the date hereof by
United to Raritan. United hereby represents and warrants to Raritan as follows:
4.1. Corporate Organization.
(a) United is a corporation duly organized and validly
existing and in good standing under the laws of the State of New Jersey. United
has the corporate power and authority to own or lease all of its properties and
assets and to carry on its business as it is now being conducted, and is duly
licensed or qualified to do business in each jurisdiction in which the nature of
the business conducted by it or the character or location of the properties and
assets owned or leased by it makes such licensing or qualification necessary,
except where the failure to be so licensed or qualified would not have a
material adverse effect on the business, operations, assets or financial
condition of United or its Subsidiaries (defined below). United is registered as
a bank holding company under the BHCA.
(b) Each of the Subsidiaries of United are listed in the
United Disclosure Schedule. The term "Subsidiary" when used in this Agreement
with reference to United, means any corporation, joint venture, association,
partnership, trust or other entity in which United has, directly or indirectly,
at least a 50% interest or acts as a general partner. Each Subsidiary of United
is duly organized and validly existing and in good standing under the laws of
the jurisdiction of its incorporation. UNB is a national bank whose deposits are
insured by the SAIF for certain deposits, and by the BIF for the remaining
deposits, in each case to the fullest extent permitted by law. Each Subsidiary
of United has the corporate power and authority to own or lease all of its
properties and assets and to carry on its business as it is now being conducted
and is duly licensed or qualified to do business in each jurisdiction in which
the nature of the business conducted by it or the character or location of the
properties and assets owned or leased by it makes such licensing or
qualification necessary, except where the failure to be so licensed or qualified
would not have a material adverse effect on the business, operations, assets or
financial condition of United and its Subsidiaries.
4.2. Capitalization. The authorized capital stock of United
consists of 16,000,000 shares of United Common Stock and 1,000,000 shares of
preferred stock ("United Preferred Stock"). As of June 30, 1998, there were
9,375,345 shares of United Common Stock issued and outstanding, including 94,303
treasury shares and 2,700 shares of restricted stock granted under the United
National Bancorp Long Term Stock Based Incentive Plan (the "United Option
Plan"), and there were no shares of United Preferred Stock outstanding. Since
June 30, 1998, to and including the date of this Agreement, no additional shares
of United Common Stock have been issued except in connection with exercises of
options granted under the United Option Plan or grants of restricted stock under
the United Option Plan. As of June 30, 1998, except for 399,772 shares of United
Common Stock issuable upon exercise of outstanding stock options granted
pursuant to the United Option Plan and the Non-Employee Director Stock Option
Plan (the "United Director Option Plan"), there were no shares of United Common
Stock issuable upon the exercise of outstanding stock options or otherwise. All
issued and outstanding shares of United Common Stock, and all issued and
outstanding shares of capital stock of United's Subsidiaries, have been duly
authorized and validly issued, are fully paid, nonassessable and free of
preemptive rights, and are free and clear of all liens, encumbrances, charges,
restrictions or rights of third parties. All of the outstanding shares of
capital stock of United's Subsidiaries are owned by United free and clear of any
liens, encumbrances, charges, restrictions or rights of third parties. Except
for the options referred to above under the United Option Plan and the United
Director Option Plan, neither United nor any of United's Subsidiaries 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 United or United's Subsidiaries or any securities
representing the right to otherwise receive any shares of such capital stock or
any securities convertible into or representing the right to purchase or
subscribe for any such shares, and there are no agreements or understandings
with respect to voting of any such shares. No additional grants of awards, or
exercises of outstanding awards, under the United Option Plan or United Director
Option Plan, or repurchases of United Common Stock, prior to the Effective Time
shall be required to be disclosed or reported to Raritan to keep the
representations in this section true or correct.
4.3. Authority; No Violation.
(a) United and UNB have full corporate power and authority to
execute and deliver this Agreement and to consummate the transactions
contemplated hereby in accordance with the terms hereof. United has a sufficient
number of authorized but unissued shares of United Common Stock to pay the
consideration for the Merger set forth in Article II of this Agreement. The
execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly and validly approved by the
Board of Directors of each of United and UNB. The execution and delivery of the
Bank Merger Agreement has been duly and validly approved by the Board of
Directors of UNB. No other corporate proceedings on the part of United and UNB
are necessary to consummate the transactions contemplated hereby (except for the
approval by United of the Bank Merger Agreement and except for any shareholder
approval that may be required by the NASDAQ/NMS listing rules). This Agreement
has been duly and validly executed and delivered by United and UNB and
constitutes a valid and binding obligation of United and UNB, enforceable
against United and UNB in accordance with its terms, except to the extent that
enforcement may be limited by (i) bankruptcy, insolvency, reorganization,
moratorium, conservatorship, receivership or other similar laws now or hereafter
in effect relating to or affecting the enforcement of creditors' rights
generally or the rights of creditors of federally-chartered banks, (ii) general
equitable principles, and (iii) laws relating to the safety and soundness of
insured depository institutions and except that no representation is made as to
the effect or availability of equitable remedies or injunctive relief.
(b) Neither the execution or delivery of this Agreement nor
the consummation by United and UNB of the transactions contemplated hereby in
accordance with the terms hereof, will (i) violate any provision of the
Certificate of Incorporation or Bylaws of United or the Articles of Association
or Bylaws of UNB, (ii) assuming that the consents and approvals set forth below
are duly obtained, violate any statute, code, ordinance, rule, regulation,
judgment, order, writ, decree or injunction applicable to United or UNB or any
of their respective properties or assets, or (iii) violate, conflict with,
result in a breach of any provision of, constitute a default (or an event which,
with notice or lapse of time, or both, would constitute a default) under, result
in the termination of, accelerate the performance required by, or result in the
creation of any lien, security interest, charge or other encumbrance upon any of
the properties or assets of United or UNB under, any of the terms, conditions or
provisions of any note, bond, mortgage, indenture, deed of trust, license,
lease, agreement or other instrument or obligation to which United or UNB is a
party, or by which United or UNB or any of their properties or assets may be
bound or affected, except, with respect to (ii) and (iii) above, such as in the
aggregate will not have a material adverse effect on the business, operations,
assets or financial condition of United and United's Subsidiaries on a
consolidated basis, or the ability of United and UNB to consummate the
transactions contemplated hereby. Except for consents and approvals of or
filings or registrations with or notices to the OCC, the OTS, the FRB, the New
Jersey Secretary of State, the Delaware Secretary of State, the SEC, or
applicable state securities bureaus or commissions, no consents or approvals of
or filings or registrations with or notices to any third party or any public
body or authority are necessary on behalf of United or UNB in connection with
(a) the execution and delivery by United or UNB of this Agreement, (b) the
consummation by United of the Merger and the other transactions contemplated
hereby and (c) the execution and delivery by UNB of the Bank Merger Agreement
and the consummation by UNB of the Bank Merger and other transactions
contemplated thereby. To United's knowledge, no fact or condition exists which
United has reason to believe will prevent it or UNB from obtaining the
aforementioned consents and approvals.
4.4. Financial Statements.
(a) United has previously delivered to Raritan copies of the
consolidated statements of financial condition of United as of December 31,
1995, 1996 and 1997, the related consolidated statements of income, changes in
stockholders' equity and of cash flows for the periods ended December 31 in each
of the three fiscal years 1995 through 1997, in each case accompanied by the
audit report of KPMG Peat Marwick LLP, the current independent public
accountants with respect to United, or Arthur Andersen, LLP, previously the
independent public accountants with respect to United, and the unaudited
consolidated statements of condition of United as of June 30, 1998 and the
related unaudited consolidated statements of income, changes in stockholders'
equity and cash flows for the six months then ended as reported in United's
Quarterly Report on Form 10-Q, filed with the SEC under the 1934 Act
(collectively, the "United Financial Statements"). The United Financial
Statements (including the related notes), have been prepared in accordance with
GAAP consistently applied during the periods involved (except as approved by
such independent public accountants and disclosed therein), and fairly present
the consolidated financial position of United as of the respective dates set
forth therein, and the related consolidated statements of income, changes in
stockholders' equity and of cash flows (including the related notes, where
applicable) fairly present the results of the consolidated operations and
changes in stockholders' equity and of cash flows of United for the respective
fiscal periods set forth therein.
(b) The books and records of United and its subsidiaries have
been and are being maintained in material compliance with applicable legal and
accounting requirements, and reflect only actual transactions.
(c) Except as and to the extent reflected, disclosed or
reserved against in the United Financial Statements (including the notes
thereto), as of June 30, 1998 neither United nor any of its Subsidiaries had or
has, as the case may be, any material obligation or liability, whether absolute,
accrued, contingent or otherwise, material to the business, operations, assets
or financial condition of United or any of its Subsidiaries and which are
required by GAAP to be disclosed in the United Financial Statements. Since June
30, 1998, neither United nor any of its Subsidiaries have incurred any material
liabilities, except in the ordinary course of business and consistent with
prudent banking practice.
4.5. Brokerage Fees. Except as set forth in the United
Disclosure Schedule, neither United nor UNB nor any of their respective
directors or officers has employed any broker or finder or incurred any
liability for any broker's or finder's fees or commissions in connection with
any of the transactions contemplated by this Agreement.
4.6. Absence of Certain Changes or Events. There has not been
any material adverse change in the business, operations, assets or financial
condition of United and United's Subsidiaries on a consolidated basis since June
30, 1998 and to United's knowledge, no fact or condition exists (other than
regional or national economic conditions which affect financial institutions
generally) which United believes will cause or is likely to cause such a
material adverse change in the future.
4.7. United Information. The information relating to United
and its subsidiaries, this Agreement and the transactions contemplated hereby in
the Registration Statement and Joint Proxy Statement/Prospectus (as defined in
Section 5.6(a) hereof), as of the dates of the mailing of the Joint Proxy
Statement/Prospectus to shareholders of United and Raritan, respectively, and up
to and including the dates of each meeting to which such Joint Proxy
Statement/Prospectus 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.
4.8. Capital Adequacy. As of the date of this Agreement each
of United and UNB has, and at the Effective Time, after taking into effect the
Merger and the transactions contemplated hereunder, each of United and UNB will
have, sufficient capital to satisfy all applicable regulatory capital
requirements.
4.9. United Common Stock. At the Effective Time, the United
Common Stock to be issued pursuant to the terms of Section 2.1, when so issued,
shall be duly authorized, validly issued, fully paid, and non-assessable, free
of preemptive rights and free and clear of all liens, encumbrances or
restrictions created by or through United, with no personal liability attaching
to the ownership thereof.
4.10. Legal Proceedings. Except as disclosed in the United
Disclosure Schedule, neither United nor its Subsidiaries is a party to any, and
there are no pending or, to United's knowledge, threatened, Legal Proceedings
against United or any of its Subsidiaries which, if decided adversely to United,
or any of its Subsidiaries, would have a material adverse effect on the
business, operations, assets or financial condition of United and its
Subsidiaries on a consolidated basis. Except as disclosed in the United
Disclosure Schedule, neither United nor any of United's Subsidiaries is a party
to any order, judgment or decree entered against United or any such Subsidiary
in any Legal Proceeding which would have a material adverse effect on the
business, operations, assets or financial condition of United and its
Subsidiaries on a consolidated basis.
4.11. Taxes and Tax Returns. United and its Subsidiaries have
duly filed (and until the Effective Time will so file) all Returns required to
be filed by them in respect of any federal, state and local taxes (including
withholding taxes, penalties or other payments required) and have duly paid (and
until the Effective Time will so pay) all such taxes due and payable, other than
taxes or other charges which are being contested in good faith. United and its
Subsidiaries have established (and until the Effective Time will establish) on
their books and records reserves for the payment of all federal, state and local
taxes not yet due and payable, but incurred in respect of United and its
Subsidiaries through such date, which reserves are, to the knowledge of United,
adequate for such purposes. No deficiencies exist or have been asserted based
upon the federal income tax returns of United and UNB.
4.12. Employee Benefit Plans.
(a) United and its Subsidiaries maintain or contribute to
certain "employee pension benefit plans" (the "United Pension Plans"), as such
term is defined in Section 3 of ERISA, and "employee welfare benefit plans" (the
"United Welfare Plans"), as such term is defined in Section 3 of ERISA. Since
September 2, 1974, neither United nor its Subsidiaries have contributed to any
"Multiemployer Plan", as such term is defined in Section 3(37) of ERISA.
(b) Each of the United Pension Plans and each of the United
Welfare Plans has been operated in compliance in all material respects with the
provisions of ERISA, the Code, all regulations, rulings and announcements
promulgated or issued thereunder, and all other applicable governmental laws and
regulations.
(c) The present value of all accrued benefits both vested and
non-vested under each of the United Pension Plans subject to Title IV of ERISA,
based upon the actuarial assumptions used for purposes of the most recent
actuarial valuation prepared by such United Pension Plan's actuary, did not
exceed the then current value of the assets of such plans allocable to such
accrued benefits. To the best of United's knowledge, the actuarial assumptions
then utilized for such plans were reasonable and appropriate as of the last
valuation date and reflect then current market conditions.
(d) During the last six years, the PBGC has not asserted any
claim for liability against United or any of its Subsidiaries which has not been
paid in full.
(e) All premiums (and interest charges and penalties for late
payment, if applicable) due to the PBGC with respect to each United Pension Plan
have been paid. All contributions required to be made to each United Pension
Plan under the terms thereof, ERISA or other applicable law have been timely
made, and all amounts properly accrued to date as liabilities of United and its
Subsidiaries which have not been paid have been properly recorded on the books
of United and its Subsidiaries.
(f) Except as disclosed on the United Disclosure Schedule,
each of the United Pension Plans, the United Welfare Plans and each other plan
and arrangement identified on the United Disclosure Schedule has been operated
in compliance in all material respects with the provisions of ERISA, the Code,
all regulations, rulings and announcements promulgated or issued thereunder, and
all other applicable governmental laws and regulations. Furthermore, the IRS has
issued a favorable determination letter, which takes into account the Tax Reform
Act of 1986 and subsequent legislation through the date of such determination
letter, with respect to each of the United Pension Plans and United is not aware
of any fact or circumstance which would disqualify any such plan, that could not
be retroactively corrected (in accordance with the procedures of the IRS).
(g) To the knowledge of United, within the past two plan years
no non-exempt prohibited transaction, within the meaning of Section 4975 of the
Code or Section 406 of ERISA, has occurred with respect to any of the United
Welfare Plans or United Pension Plans.
(h) No United Pension Plan or any trust created thereunder has
been terminated, nor have there been any "reportable events", within the meaning
of Section 4034(b) of ERISA, with respect to any of the United Pension Plans.
(i) To the knowledge of United, no "accumulated funding
deficiency", within the meaning of Section 412 of the Code, has been incurred
with respect to any of the United Pension Plans.
4.13. Reports.
(a) Each communication mailed by United to its stockholders
since January 1, 1995, and each annual, quarterly or special report, proxy
statement or communication, as of its date, complied in all material respects
with all applicable statutes, rules and regulations enforced or promulgated by
the applicable regulatory agency 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 made therein, in light of the
circumstances under which they were made, not misleading; provided that
disclosures as of a later date shall be deemed to modify disclosures as of an
earlier date.
(b) Since January 1, 1995, (i) United has filed all reports
that it was required to file with the SEC under the 1934 Act, and (ii) United
and UNB each has duly filed all material forms, reports and documents which they
were required to file with each agency charged with regulating any aspect of
their business, in each case in form which was correct in all material respects,
and, subject to permission from such regulatory authorities, United promptly
will deliver or make available to Raritan accurate and complete copies of such
reports. As of their respective dates, each such form, report, or document
referred to in either of clauses (i) or (ii) above, and each final registration
statement, prospectus, annual, quarterly or special report, definitive proxy
statement or communication referred to in either of clauses (i) or (ii) of
paragraph (b) above, complied in all material respects with all applicable
statutes, rules and regulations 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 made therein, in light of the
circumstances under which they were made, not misleading; provided that
information contained in any such document as of a later date shall be deemed to
modify information as of an earlier date. The United Disclosure Schedule lists
the dates of all examinations of United or UNB conducted by either the OCC or
the FDIC since January 1, 1995 and the dates of any responses thereto submitted
by United or UNB.
4.14. Compliance with Applicable Law. United and its
Subsidiaries hold all material licenses, franchises, permits and authorizations
necessary for the lawful conduct of their respective businesses under and
pursuant to each, and has complied with and is not in default in any respect
under any, applicable law, statute, order, rule, regulation, policy and/or
guideline of any federal, state or local governmental authority or the
NASDAQ/NMS relating to United and its Subsidiaries (other than where such
default or non-compliance will not result in a material adverse effect on the
business, operations, assets or financial condition of United and its
Subsidiaries on a consolidated basis) and United has not received notice of
violations of, and does not know of any violations (other than violations which
will not, alone or in the aggregate, result in a material adverse effect on the
business operations, assets or financial condition of United and its
Subsidiaries on a consolidated basis) of, any of the above. Without limiting the
foregoing, to its knowledge UNB has complied in all material respects with the
CRA and United has received no written notice that any person or group would
object to the consummation of a merger involving UNB due to the CRA performance
or rating of UNB. To the knowledge of United, except as listed on the United
Disclosure Schedule, no person or group has adversely commented upon UNB's CRA
performance. The most recent CRA rating received by UNB was "Satisfactory."
4.15. Properties and Insurance.
(a) United and its Subsidiaries have good and, as to owned
real property, marketable title to all material assets and properties, whether
real or personal, tangible or intangible, reflected in United's consolidated
balance sheet as of June 30, 1998, or owned and acquired subsequent thereto
(except to the extent that such assets and properties have been disposed of for
fair value in the ordinary course of business since June 30, 1998). United and
its Subsidiaries as lessees have the right under valid and subsisting leases to
occupy, use, possess and control all real property leased by them in all
material respects as presently occupied, used, possessed and controlled by them.
(b) The business operations and all insurable properties and
assets of United and its Subsidiaries are insured for their benefit against all
risks which, in the reasonable judgment of the management of United should be
insured against, in each case under valid, binding and enforceable policies or
bonds, with such deductibles and against such risks and losses as are in the
opinion of the management of United adequate for the business engaged in by
United and its Subsidiaries. As of the date hereof, neither United nor any of
its Subsidiaries has received any notice of cancellation or notice of a material
amendment of any such insurance policy or bond or is in default under such
policy or bond, no coverage thereunder is being disputed and all material claims
thereunder have been filed in a timely fashion.
4.16. Minute Books. The minute books of United and its
Subsidiaries contain records that are accurate in all material respects of all
meetings and other corporate action held of their respective stockholders and
Boards of Directors (including committees of their respective Boards of
Directors).
4.17. Environmental Matters. Except as disclosed in the United
Disclosure Schedule, neither United nor any of its Subsidiaries has received any
written notice, citation, claim, assessment, proposed assessment or demand for
abatement alleging that United or any of its Subsidiaries (either directly or as
a successor-in-interest in connection with the enforcement of remedies to
realize the value of properties serving as collateral for outstanding loans) is
responsible for the correction or clean-up of any condition material to the
business, operations, assets or financial condition of United or its
Subsidiaries. Except as disclosed in the United Disclosure Schedule, United has
no knowledge that any toxic or hazardous substances or materials have been
emitted, generated, disposed of or stored on any property owned or leased by
United or any of its Subsidiaries, as OREO or otherwise, or owned or controlled
by United or any of its Subsidiaries as a trustee or fiduciary in any manner,
that violates or, after the lapse of time may violate, any presently existing
federal, state or local law or regulation governing or pertaining to such
substances and materials, the violation of which would have a material adverse
effect on the business, operations, assets or financial condition of United and
its Subsidiaries on a consolidated basis.
4.18. Reserves. The allowance for possible loan and lease
losses in the June 30, 1998 United Financial Statements was, to United's
knowledge, adequate at the time based upon past loan loss experiences and
potential losses in the portfolio at the time to cover all then known or
anticipated loan losses.
4.19. Year 2000 Compliance. United and the United Subsidiaries
have taken all reasonable steps necessary to address the software, accounting
and record keeping issues raised in order for the data processing systems used
in the business conducted by United and the United Subsidiaries to be
substantially Year 2000 compliant on or before the end of 1999 and United does
not expect the future cost of addressing such issues to be material. Neither
United nor any United Subsidiary has received a rating of less than satisfactory
from any bank regulatory agency with respect to Year 2000 compliance.
4.20. Agreements with Bank Regulators. Except as disclosed in
the United Disclosure Schedule, neither United nor any United Subsidiary is a
party to any agreement or memorandum of understanding with, or a party to any
commitment letter, board resolution submitted to a regulatory authority or
similar undertaking to, or is subject to any order or directive by, or is a
recipient of any extraordinary supervisory letter from, any Governmental Entity
which restricts materially the conduct of its business, or in any manner relates
to its capital adequacy, its credit or reserve policies or its management,
except for those the existence of which has been disclosed in writing to Raritan
by United prior to the date of this Agreement, nor has United been advised by
any Governmental Entity that it is contemplating issuing or requesting (or is
considering the appropriateness of issuing or requesting) any such order,
decree, agreement, memorandum of understanding, extraordinary supervisory
letter, commitment letter or similar submission, except as disclosed in writing
to Raritan by United prior to the date of this Agreement. Neither United nor any
United Subsidiary is required by Section 32 of the Federal Deposit Insurance Act
to give prior notice to a Federal banking agency of the proposed addition of an
individual to its board of directors or the employment of an individual as a
senior executive officer, except as disclosed in writing to Raritan by United
prior to the date of this Agreement.
4.21. Disclosures. No representation or warranty contained in
Article IV of this Agreement contains any untrue statement of a material fact or
omits to state a material fact necessary to make the statements herein not
misleading.
ARTICLE V
COVENANTS OF THE PARTIES
5.1. Conduct of the Business of Raritan. During the period
from the date of this Agreement to the Effective Time, Raritan shall, and shall
cause each of its Subsidiaries to, conduct its respective business and engage in
transactions permitted hereunder only in the ordinary course and consistent with
prudent banking practice, except with the prior written consent of United, which
consent will not be unreasonably withheld. Raritan also shall use all reasonable
efforts to (i) preserve its business organization and that of each Raritan
Subsidiary intact, (ii) keep available to itself the present services of its
employees and those of its Subsidiaries, provided that neither Raritan nor any
of its Subsidiaries shall be required to take any unreasonable or extraordinary
act or any action which would conflict with any other term of this Agreement,
(iii) preserve for itself and United the goodwill of its customers and those of
its Subsidiaries and others with whom business relationships exist, and (iv)
take any action which United may reasonably request in order to cause the Merger
to qualify as a pooling of interests for accounting purposes including, without
limitation, reissuing "tainted" shares of Raritan Common Stock if United so
requests.
5.2. Negative Covenants and Dividend Covenants.
(a) Raritan agrees that from the date hereof to the Effective
Time, except as set forth in Section 5.2 of the Raritan Disclosure Schedule or
as otherwise approved by United in writing or as permitted or required by this
Agreement, it will not, nor will it permit any of its Subsidiaries to:
(i) change any provision of its Certificate of
Incorporation or Charter, as the case may be, or Bylaws or any similar governing
documents;
(ii) except for the issuance of Raritan Common Stock
pursuant to the present terms of the outstanding Raritan Options and the United
Stock Option and as disclosed in the Raritan Disclosure Schedule, change the
number of shares of its authorized or issued common or preferred stock or issue
or grant any option, warrant, call, commitment, subscription, right to purchase
or agreement of any character relating to the authorized or issued capital stock
of Raritan or any Raritan Subsidiary or any securities convertible into shares
of such stock, or split, combine or reclassify any shares of its capital stock,
or redeem or otherwise acquire any shares of such capital stock, or declare, set
aside or pay any dividend, or other distribution (whether in cash, stock or
property or any combination thereof) in respect of its capital stock, or redeem
or otherwise acquire any shares of such capital stock, other than Raritan's
regular quarterly cash dividends in amounts not to exceed $0.15 per calendar
quarter, with the dividend payment dates to be coordinated with United, it being
the intention of the parties that the shareholders of Raritan receive dividends
for any particular calendar quarter on either the Raritan Common Stock or the
United Common Stock acquired in exchange therefor pursuant to the terms of this
Agreement but not both; provided further, that nothing contained herein shall be
deemed to affect the ability of the Bank to pay dividends on its capital stock
to Raritan;
(iii) grant any severance or termination pay (other
than pursuant to agreements or policies of Raritan in effect on the date hereof
and disclosed in the Raritan Disclosure Schedule or as agreed to by United in
writing) to, or enter into or amend any employment agreement with, any of its
directors, officers or employees, adopt any new employee benefit plan or
arrangement of any type or amend any such existing benefit plan or arrangement;
or award any increase in compensation or benefits to its directors, officers or
employees;
(iv) sell or dispose of any substantial amount of
assets or incur any significant liabilities other than in the ordinary course of
business consistent with past practices and policies;
(v) make any capital expenditures other than pursuant
to binding commitments existing on the date hereof and expenditures necessary to
maintain existing assets in good repair and expenditures described in business
plans or budgets previously furnished to United;
(vi) file any applications or make any contract with
respect to branching or site location or relocation.
(vii) agree to acquire in any manner whatsoever
(other than to foreclose on collateral for a defaulted loan) any business or
entity;
(viii) make any material change in its accounting
methods or practices, other than changes required in accordance with GAAP;
(ix) take any action that would result in any of the
representations and warranties contained in Article III of this Agreement not
being true and correct in any material respect at the Effective Time; or
(x) agree to do any of the foregoing.
(b) United agrees that from the date hereof to the Effective
Time, except as otherwise approved by Raritan in writing or as permitted or
required by this Agreement, it will not, nor will it permit any of its
Subsidiaries to:
(i) take any action that is intended or may
reasonably be expected to result in any of its representations and warranties
set forth in this Agreement being or becoming untrue in any material respect, or
that may result in any condition, agreement or covenant set forth in this
Agreement not being satisfied;
(ii) take or cause to be taken any action which would
disqualify the Merger as a tax free reorganization under Section 368 of the Code
or as a pooling of interests for accounting purposes;
(iii) consolidate with or merge with any other person
or entity in which United is not the surviving entity, or convey, transfer or
lease its properties and assets substantially as an entirety to any person or
entity unless such person or entity shall expressly assume the obligations of
United under this Agreement; or
(iv) authorize or enter into any agreement or
commitment to do any of the foregoing.
5.3. No Solicitation. So long as this Agreement remains in
effect, Raritan and the Bank shall not, directly or indirectly, encourage or
solicit or hold discussions or negotiations with, or provide any information to,
any person, entity or group (other than United) concerning any merger or sale of
shares of capital stock or sale of substantial assets or liabilities not in the
ordinary course of business, or similar transactions involving Raritan or the
Bank (an "Acquisition Transaction"). Notwithstanding the foregoing, Raritan may
enter into discussions or negotiations or provide information in connection with
an unsolicited possible Acquisition Transaction if the Board of Directors of
Raritan, after consulting with counsel, determines in the exercise of its
fiduciary responsibilities that such discussions or negotiations should be
commenced or such information should be furnished. Raritan shall promptly
communicate to United the terms of any proposal, whether written or oral, which
it may receive in respect of any such Acquisition Transaction and the fact that
it is having discussions or negotiations with a third party about an Acquisition
Transaction.
5.4. Current Information. During the period from the date of
this Agreement to the Effective Time, Raritan will cause one or more of its
designated representatives to confer on a monthly basis, or on such other
schedule as the parties may mutually agree upon, with representatives of United
regarding Raritan's business, operations, properties, assets and financial
condition and matters relating to the completion of the transactions
contemplated herein. Without limiting the foregoing, promptly, but in any event
within 30 days, after granting any new loan or extension of credit, or any
renewal of an existing loan or extension of credit, in excess of $250,000,
Raritan and the Bank will send United a description thereof, and thereafter
Raritan will promptly send to United copies of such documents relating thereto
as United shall reasonably request. As soon as reasonably available, but in no
event more than 45 days after the end of each fiscal quarter (other than the
last fiscal quarter of each fiscal year) ending after the date of this
Agreement, Raritan will deliver to United the Bank's call reports filed with the
FDIC and Raritan's quarterly reports on Form 10-Q as filed with the SEC under
the 1934 Act, and United will deliver to Raritan United's quarterly reports on
Form 10-Q, as filed with the SEC under the 1934 Act, and UNB's call reports
filed with the OCC and the FDIC. As soon as reasonably available, but in no
event more than 90 days after the end of each fiscal year, Raritan will deliver
to United and United will deliver to Raritan their respective year end financial
statements and related reports to shareholders and regulatory agencies.
5.5. Access to Properties and Records; Confidentiality.
(a) Raritan and the Bank shall permit United and its agents
and representatives, including, without limitation, officers, directors,
employees, attorneys, accountants and financial advisors (collectively,
"Representatives"), and United and UNB shall permit Raritan and its
Representatives, reasonable access to their respective properties, and shall
disclose and make available to United and its Representatives or Raritan and its
Representatives as the case may be, all books, papers and records relating to
their respective assets, stock ownership, properties, operations, obligations
and liabilities, including, but not limited to, all books of account (including
the general ledger), tax records, minute books of directors' and stockholders'
meetings, organizational documents, bylaws, material contracts and agreements,
filings with any regulatory authority, independent auditors' work papers
(subject to the receipt by such auditors of a standard access representation
letter), litigation files, plans affecting employees, and any other business
activities or prospects in which United and its Representatives or Raritan and
its Representatives may have a reasonable interest. Neither party shall be
required to provide access to or to disclose information where such access or
disclosure would violate or prejudice the rights of any customer or would
contravene any law, rule, regulation, order or judgment or, in the case of a
document which is subject to an attorney client privilege, would compromise the
right of the disclosing party to claim that privilege. The parties will use all
reasonable efforts to obtain waivers of any such restriction (other than the
attorney client privilege) and in any event make appropriate substitute
disclosure arrangements under circumstances in which the restrictions of the
preceding sentence apply. Raritan acknowledges that United may be involved in
discussions concerning other potential acquisitions and United shall not be
obligated to disclose such information to Raritan except as such information is
publicly disclosed by United.
(b) All information furnished by the parties hereto previously
in connection with transactions contemplated by this Agreement or pursuant
hereto shall be used solely for the purpose of evaluating the Merger
contemplated hereby, shall be kept confidential and shall be treated as the sole
property of the party delivering the information until consummation of the
Merger contemplated hereby and, if such Merger shall not occur, each party and
each party's Representatives shall return to the other party all documents or
other materials containing, reflecting or referring to such information, will
not retain any copies of such information, shall keep confidential all such
information, and shall not directly or indirectly use such information for any
competitive or other commercial purposes or any other purposes not expressly
permitted hereby. Each party shall inform its Representatives of the terms of
this Section 5.5. Any breach of this Section 5.5 by a Representative of a party
hereto shall conclusively be deemed to be a breach thereof by such party. In the
event that the Merger contemplated hereby is abandoned, all documents, notes and
other writings prepared by a party hereto or its Representatives based on
information furnished by the other party shall be promptly destroyed. The
obligation to keep such information confidential shall continue for five years
from the date the proposed Merger is abandoned but shall not apply to (i) any
information which (A) the party receiving the information can establish by
convincing evidence was already in its possession prior to the disclosure
thereof to it by the other party; (B) was then generally known to the public;
(C) became known to the public through no fault of the party receiving such
information; or (D) was disclosed to the party receiving such information by a
third party not bound by an obligation of confidentiality; or (ii) disclosures
pursuant to a legal, regulatory or examination requirement or in accordance with
an order of a court of competent jurisdiction.
(c) In addition to all other remedies that may be available to
any party hereto in connection with a breach by any other party hereto of its or
its Representative's obligations under this Section 5.5, each party hereto shall
be entitled to specific performance and injunctive and other equitable relief
with respect to this Section 5.5. Each party hereto waives, and agrees to use
all reasonable efforts to cause its Representatives to waive, any requirement to
secure or post a bond in connection with any such relief.
5.6. Regulatory Matters.
(a) For the purposes of holding the meetings of Raritan
stockholders and United shareholders referred to in Section 5.7 hereof and
registering or otherwise qualifying under applicable federal and state
securities laws United Common Stock to be issued to Record Holders and Optionees
in connection with the Merger, the parties hereto shall cooperate in the
preparation and filing by United of a Registration Statement with the SEC which
shall include an appropriate joint proxy statement and prospectus satisfying all
applicable requirements of applicable state and federal laws, including the 1933
Act, the 1934 Act and applicable state securities laws and the rules and
regulations thereunder. (Such joint proxy statement and prospectus in the form
mailed by Raritan to the Raritan stockholders and Optionees together with any
and all amendments or supplements thereto, and in the form mailed by United to
the United shareholders together with any and all amendments or supplements
thereto, is collectively herein referred to as the "Joint Proxy
Statement/Prospectus" and the various documents to be filed by United under the
1933 Act with the SEC to register for sale the United Common Stock to be issued
to Record Holders and Optionees, including the Proxy Statement/Prospectus, are
referred to herein as the "Registration Statement").
(b) United shall furnish information concerning United and the
Merger as is necessary in order to cause the Joint Proxy Statement/Prospectus,
insofar as it relates to United and the Merger, to comply with Section 5.6(a)
hereof. United agrees promptly to advise Raritan if at any time prior to the
Raritan stockholder meeting referred to in Section 5.7 hereof, any information
provided by United in the Joint Proxy Statement/Prospectus becomes incorrect or
incomplete in any material respect and to provide Raritan with the information
needed to correct such inaccuracy or omission. United shall furnish Raritan with
such supplemental information as may be necessary in order to cause the Joint
Proxy Statement/Prospectus, insofar as it relates to United and the Merger, to
comply with Section 5.6(a) after the mailing thereof to Raritan stockholders and
United shareholders.
(c) Raritan shall furnish United with such information
concerning Raritan and the Bank as is necessary in order to cause the Joint
Proxy Statement/Prospectus, insofar as it relates to such corporations, to
comply with Section 5.6(a) hereof. Raritan agrees promptly to advise United if,
at any time prior to either of the meetings referred to in Section 5.6(a)
hereof, information provided by Raritan in the Joint Proxy Statement/Prospectus
becomes incorrect or incomplete in any material respect and to provide United
with the information needed to correct such inaccuracy or omission. Raritan
shall furnish United with such supplemental information as may be necessary in
order to cause the Joint Proxy Statement/Prospectus, insofar as it relates to
Raritan and the Bank, to comply with Section 5.6(a) after the mailing thereof to
Raritan stockholders and United shareholders.
(d) United shall promptly make such filings as are necessary
in connection with the offering of the United Common Stock pursuant to the
Merger with applicable state securities agencies and shall use all reasonable
efforts to qualify the offering of the United Common Stock under applicable
state securities laws at the earliest practicable date. Raritan shall promptly
furnish United with such information regarding the Raritan stockholders as
United requires to enable it to determine what filings are required hereunder.
Raritan authorizes United to utilize in such filings the information concerning
Raritan and the Bank provided to United in connection with, or contained in, the
Joint Proxy Statement/Prospectus. United shall furnish Raritan with drafts of
all such filings, as well as filings with the SEC and all regulatory filings in
connection with the Merger, shall provide Raritan with the opportunity to
comment thereon, and shall keep Raritan advised of the status thereof. United
shall as promptly as practicable file the Registration Statement containing the
Joint Proxy Statement/Prospectus with the SEC, and each of United and Raritan
shall promptly notify the other of all communications, oral or written, with the
SEC concerning the Registration Statement and the Joint Proxy
Statement/Prospectus.
(e) United shall cause the United Common Stock to be issued in
connection with the Merger to be listed on the NASDAQ/NMS.
(f) The parties hereto will cooperate with each other and use
all reasonable efforts to prepare all necessary documentation, to effect all
necessary filings and to obtain all necessary permits, consents, waivers,
approvals and authorizations of all third parties and governmental bodies
necessary to consummate the transactions contemplated by this Agreement as soon
as possible, including, without limitation, those required by the OCC, the
Commissioner, the State of New Jersey, the FDIC and the FRB. The parties shall
each have the right to review in advance (and shall do so promptly) all
information relating to the other, as the case may be, and any of their
respective subsidiaries, which appears in any filing made with, or written
material submitted to, any third party or governmental body in connection with
the transactions contemplated by this Agreement. The parties hereto shall use
reasonable business efforts to file for approval or waiver by the appropriate
bank regulatory agencies within 60 days of the date hereof.
(g) Each of the parties will promptly furnish each other with
copies of written communications received by them or any of their respective
subsidiaries from, or delivered by any of the foregoing to, any governmental
body in respect of the transactions contemplated hereby.
(h) Raritan acknowledges that United is in or may be in the
process of acquiring other banks and financial institutions and that in
connection with such acquisitions, information concerning Raritan may be
required to be included in the registration statements, if any, for the sale of
securities of United or in SEC reports in connection with such acquisitions.
Raritan agrees to provide United with any information, certificates, documents
or other materials about Raritan as are reasonably necessary to be included in
such other SEC reports or registration statements, including registration
statements which may be filed by United prior to the Effective Time. Raritan
shall use its reasonable efforts to cause its attorneys and accountants to
provide United and any underwriters for United with any consents, comfort
letters, opinion letters, reports or information which are necessary to complete
the registration statements and applications for any such acquisition or
issuance of securities. United shall reimburse Raritan for reasonable expenses
thus incurred by Raritan should this Agreement be terminated for any reason.
United shall not file with the SEC any registration statement or amendment
thereto or supplement thereof containing information regarding Raritan unless
Raritan shall have consented in writing to such filing, which consent shall not
be unreasonably delayed or withheld.
(i) Between the date of this Agreement and the Effective Time,
Raritan shall cooperate with United to be in a position as of the Effective Time
to reasonably conform Raritan's policies and procedures regarding applicable
regulatory matters to those of United as United may reasonably identify to
Raritan from time to time.
5.7. Approval of Stockholders.
(a) Raritan will (i) take all steps reasonably necessary duly
to call, give notice of, convene and hold a meeting of the stockholders of
Raritan as soon as reasonably practicable for the purpose of securing the
approval by such stockholders of this Agreement, (ii subject to the fiduciary
responsibilities of the Board of Directors of Raritan to the stockholders of
Raritan, recommend to the stockholders of Raritan the approval of this Agreement
and the transactions contemplated hereby and use all reasonable efforts to
obtain, as promptly as practicable, such approvals, and (iii) cooperate and
consult with United with respect to each of the foregoing matters. In connection
therewith, Raritan will use reasonable efforts to cause each director of Raritan
to agree, (x) to vote in favor of the Merger, and (y) take such action as is
necessary or is reasonably required by United to consummate the Merger.
(b) United will (i) take all steps reasonably necessary duly
to call, give notice of, convene and hold a meeting of the stockholders of
United as soon as reasonably practicable for the purpose of securing the
approval by such stockholders of this Agreement, (ii subject to the fiduciary
responsibilities of the Board of Directors of United to the stockholders of
United, recommend to the stockholders of United the approval of this Agreement
and the transactions contemplated hereby and use all reasonable efforts to
obtain, as promptly as practicable, such approvals, and (iii) cooperate and
consult with Raritan with respect to each of the foregoing matters. In
connection therewith, United will use reasonable efforts to cause each director
of United to agree, (x) to vote in favor of the Merger, and (y) take such action
as is necessary or is reasonably required by Raritan to consummate the Merger.
5.8. Further Assurances. Subject to the terms and conditions
herein provided, each of the parties hereto agrees to use all reasonable efforts
to take, or cause to be taken, all actions and to do, or cause to be done, all
things reasonably necessary, proper or advisable under applicable laws and
regulations to satisfy the conditions to Closing and to consummate and make
effective the transactions contemplated by this Agreement, including, without
limitation, using reasonable efforts to lift or rescind any injunction or
restraining order or other order adversely affecting the ability of the parties
to consummate the transactions contemplated by this Agreement and using all
reasonable efforts to prevent the breach of any representation, warranty,
covenant or agreement of such party contained or referred to in this Agreement
and to promptly remedy the same. Nothing in this section shall be construed to
require any party to participate in any threatened or actual Legal Proceedings
(other than Legal Proceedings to which it is otherwise a party or subject or
threatened to be made a party or subject) in connection with consummation of the
transactions contemplated by this Agreement unless such party shall consent in
advance and in writing to such participation and the other party agrees to
reimburse and indemnify such party for and against any and all costs and damages
related thereto.
5.9. Public Announcements. The parties hereto shall cooperate
with each other, and obtain each other's prior approval, in the development and
distribution of all news releases and other public disclosures with respect to
this Agreement or any of the transactions contemplated hereby, except as may be
otherwise required by law or regulation or as to which the party releasing such
information has used all reasonable efforts to discuss with the other party in
advance.
5.10. Failure to Fulfill Conditions. In the event that United
or Raritan determines that a material condition to its obligation to consummate
the transactions contemplated hereby cannot be fulfilled on or prior to June 30,
1999 (the "Cutoff Date") and that it will not waive that condition, it will
promptly notify the other party. Except for any acquisition or merger
discussions United may enter into with other parties, Raritan and United will
promptly inform the other of any facts applicable to Raritan or United,
respectively, or their respective directors or officers, that would be likely to
prevent or materially delay approval of the Merger by any governmental authority
or which would otherwise prevent or materially delay completion of the Merger.
5.11. Disclosure Supplements. From time to time prior to the
Effective Time, each party hereto will promptly supplement or amend (by written
notice to the other) its respective Disclosure Schedules delivered 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 such Schedules or which is necessary to correct any
information in such Schedules which has been rendered materially inaccurate
thereby. For the purpose of determining satisfaction of the conditions set forth
in Article VI, no supplement or amendment to such Schedules shall correct or
cure any warranty which was untrue when made, but supplements or amendments may
be used to disclose subsequent facts or events to maintain the truthfulness of
any warranty.
5.12 Transaction Expenses of Raritan.
(a) To the extent not already done, Raritan shall promptly,
but in any event within 30 days, after the execution of this Agreement ask all
of its attorneys and other professionals to render current and correct invoices
for all unbilled time and disbursements, and request that its professionals
render monthly invoices within 30 days after the end of each month. Raritan
shall accrue and/or pay all of such amounts as soon as possible.
(b) United and Raritan shall jointly make all arrangements
with respect to the printing and mailing of the Joint Proxy
Statement/Prospectus.
5.13. Closing. The parties hereto shall cooperate and use
reasonable efforts to try to cause the Effective Time to occur during January,
1999.
5.14. Indemnification.
(a) For a period of six years after the Effective Time, United
shall indemnify, defend and hold harmless each person who is now, or has been at
any time prior to the date hereof or who becomes prior to the Effective Time, a
director or officer of Raritan or the Bank (collectively, the "Indemnitees")
against any and all claims, damages, liabilities, losses, costs, charges,
expenses (including, without limitation, reasonable costs of investigation, and
the reasonable fees and disbursements of legal counsel and other advisers and
experts as incurred), judgments, fines, penalties and amounts paid in
settlement, asserted against, incurred by or imposed upon any Indemnitee by
reason of the fact that he or she is or was a director or officer of Raritan or
the Bank or acted as a director or officer of a third party at the written
request of Raritan or the Bank, in connection with, arising out of or relating
to any threatened, pending or completed claim, action, suit or proceeding
(whether civil, criminal, administrative or investigative), including, without
limitation, any and all claims, actions, suits, proceedings or investigations by
or on behalf of or in the right of or against Raritan or the Bank or any of
their respective affiliates, or by any former or present shareholder of Raritan
or the Bank (each a "Claim" and collectively, "Claims"), including, without
limitation, any Claim which is based upon, arises out of or in any way relates
to the Merger, the Joint Proxy Statement/Prospectus, this Agreement, any of the
transactions contemplated by this Agreement, the Indemnitee's service as a
member of the Board of Directors of Raritan or the Bank or any committee of such
board, the events leading up to the execution of this Agreement, any statement,
announcement, recommendation or solicitation made in connection therewith or
related thereto (or the absence of any of the foregoing) and any breach of any
duty in connection with any of the foregoing, in each case to the fullest extent
which Raritan or the Bank, as the case may be, would have been permitted under
any applicable law and its Certificate of Incorporation and By-Laws had the
Merger not occurred (and United shall also advance expenses as incurred to the
fullest extent so permitted).
(b) From and after the Effective Time, United shall assume and
honor any obligation of Raritan or the Bank immediately prior to the Effective
Time with respect to the indemnification of the Indemnitees arising out of the
Certificate of Incorporation or By-Laws of Raritan or the Bank or arising out of
any written indemnification agreements between Raritan or the Bank and such
persons disclosed in the Raritan Disclosure Schedule, as if such obligations
were pursuant to a contract or arrangement between United and such Indemnitees,
including the obligation to advance expenses pursuant to Raritan's Certificate
of Incorporation and Bylaws.
(c) In the event United or any of its successors or assigns
(i) reorganizes or consolidates with or merges into or enters into another
business combination transaction with any other person or entity and is not the
resulting, continuing or surviving corporation or entity of such consolidation,
merger or transaction, or (ii) liquidates, dissolves or transfers all or
substantially all of its properties and assets to any person or entity, then,
and in each such case, proper provision shall be made so that the successors and
assigns of United assume the obligations set forth in this Section 5.14.
(d) United shall cause Raritan's and the Bank's officers and
directors to be covered, for a period of six years after the Effective Time,
under (i) United's then current officers' and directors' liability insurance
policy or (ii) an extension of Raritan's or the Bank's existing officers' and
directors' liability insurance policy. However, United shall only be required to
insure such persons upon terms and for coverages substantially similar to
Raritan's or the Bank's existing officers' and directors' liability insurance,
as the case may be.
(e) Any Indemnitee wishing to claim indemnification under this
Section 5.14 shall promptly notify United upon learning of any Claim, but the
failure to so notify shall not relieve United of any liability it may have to
such Indemnitee if such failure does not materially prejudice United. In the
event of any Claim (whether arising before or after the Effective Time) as to
which indemnification under this Section 5.14 is applicable, (x) United shall
have the right to assume the defense thereof and United shall not be liable to
such Indemnitees for any legal expenses of other counsel or any other expenses
subsequently incurred by such Indemnitee in connection with the defense thereof,
except that if United elects not to assume such defense, or counsel for the
Indemnitees advises that there are issues which raise conflicts of interest
between United and the Indemnitees, the Indemnitees may retain counsel
satisfactory to them, and United shall pay the reasonable fees and expenses of
such counsel for the Indemnitees as statements therefor are received; provided,
however, that United shall be obligated pursuant to this Section 5.14(e) to pay
for only one firm of counsel for all Indemnitees in any jurisdiction with
respect to a matter unless the use of one counsel for multiple Indemnitees would
present such counsel with a conflict of interest that is not waivable by the
Indemnitees, and (y) the Indemnitees will cooperate in the defense of any such
matter. United shall not be liable for settlement of any claim, action or
proceeding hereunder unless such settlement is effected with its prior written
consent. Notwithstanding anything to the contrary in this Section 5.14, United
shall not have any obligation hereunder to any Indemnitee when and if a court of
competent jurisdiction shall ultimately determine, and such determination shall
have become final and nonappealable, that the indemnification of such Indemnitee
in the manner contemplated hereby is prohibited by applicable law or public
policy.
5.15. New United and UNB Directors. As of the Effective Time,
United shall cause its Board of Directors and the UNB Board of Directors to take
action to appoint to the Boards of Directors of United and UNB, respectively, at
the Effective Time, Arlyn D. Rus and one other current Raritan director who
shall be proposed by Raritan and approved by United. Such persons will serve on
separate classes of the Board of Directors of United and Mr. Rus shall serve as
Vice Chairman of the Board of United. As of the Effective Time, United shall
cause the UNB Board of Directors to take action to create an advisory Board of
Directors and to invite all then directors of Raritan to serve on such advisory
board.
5.16. Employment Matters. In connection with the Merger,
United and Raritan will deal with employment and severance contracts and
arrangements with officers and employees of Raritan and the Bank in the manner
set forth in Section 5.16 of the Raritan Disclosure Schedule.
5.17. Pooling and Tax-Free Reorganization Treatment. Neither
United nor Raritan shall intentionally take, fail to take or cause to be taken
or not be taken, any action within its control, whether before or after the
Effective Time, which would disqualify the Merger as a "pooling of interests"
for accounting purposes or as a "reorganization" within the meaning of Section
368(a) of the Code.
5.18. Raritan Option Plans. From and after the Effective Time,
each Raritan Option which is converted to an option to purchase United Common
Stock under Section 2.1(b) shall be administered, operated and interpreted by a
committee comprised of members of the Board of Directors of United appointed by
the Board of Directors of United (including one or more former directors of
Raritan). United shall reserve for issuance the number of shares of United
Common Stock necessary to satisfy United's obligations. United shall also
register, if not previously registered pursuant to the 1933 Act, the shares
authorized for issuance under the Raritan Options so converted.
5.19. Affiliates.
(a) Promptly, but in any event within 30 days, after the
execution and delivery of this Agreement, (i) Raritan shall deliver to United
(x) a letter identifying all persons who, to the knowledge of Raritan, may be
deemed to be affiliates of Raritan under Rule 145 of the 1933 Act, including
without limitation all directors and executive officers of Raritan and (y) a
letter identifying all persons who, to the knowledge of Raritan, may be deemed
to be affiliates of Raritan as that term (affiliate) is used for purposes of
qualifying for pooling-of-interests accounting treatment; and (ii) United shall
identify to Raritan all persons who, to the knowledge of United, may be deemed
affiliates of United as that term (affiliates) is used for purposes of
qualifying for pooling-of-interests accounting treatment.
(b) Raritan shall cause each director of Raritan to, and
Raritan shall use all reasonable efforts to cause each executive officer of
Raritan and each other person who may be deemed an affiliate of Raritan (under
either Rule 145 of the 1933 Act or the accounting treatment rules) to, execute
and deliver to United within 30 days after the execution and delivery of this
Agreement, a letter substantially in the form of Exhibit 5.19 hereto agreeing to
be bound by the restrictions of Rule 145 and agreeing to be bound by the rules
which permit the Merger to be treated as a pooling of interests for accounting
purposes. In addition, United shall cause each director and executive officer of
United to, and United shall use all reasonable efforts to cause each other
person who may be deemed an affiliate of United (as that term is used for
purposes of qualifying for pooling of interests) to, execute and deliver to
United within 30 days after the execution and delivery of this Agreement, a
letter substantially in the form of Exhibit 5.19.1 hereto in which such persons
agree to be bound by the rules which permit the Merger to be treated as a
pooling of interests for accounting treatment.
(c) United shall use reasonable business efforts to publish as
soon as possible, but no later than 20 days after the end of the first month
after the Effective Time in which there are at least 30 days of post-Merger
combined operations, combined revenues and net income figures as contemplated by
and in accordance with the terms of SEC Accounting Series Release No. 135.
5.20. Compliance with the Industrial Site Recovery Act.
Raritan, at its sole cost and expense, shall use all reasonable efforts to
obtain prior to the Effective Time, with respect to each facility located in New
Jersey owned or operated by Raritan or any Raritan Subsidiary (each, a
"Facility"), either: (a) a Letter of Non-Applicability ("LNA") from the New
Jersey Department of Environmental Protection ("NJDEP") stating that the
Facility is not an "industrial establishment," as such term is defined under the
Industrial Site Recovery Act ("ISRA"); (b) a Remediation Agreement issued by the
NJDEP pursuant to ISRA authorizing the consummation of the transactions
contemplated by this Agreement; (c) a Negative Declaration approval, Remedial
Action Workplan approval, No Further Action letter or other document or
documents issued by the NJDEP advising that the requirements of ISRA have been
satisfied with respect to the Facility; or (d) an opinion addressed to United
from New Jersey legal counsel reasonably acceptable to United to the effect that
ISRA has been complied with, or is inapplicable, with respect to the Facility.
In the event Raritan obtains a Remediation Agreement, Raritan will post or have
posted an appropriate Remediation Funding Source or will have obtained the
NJDEP's approval to self-guaranty any Remediation Funding Source required under
any such Remediation Agreement.
ARTICLE VI
CLOSING CONDITIONS
6.1. Conditions of Each Party's Obligations Under this
Agreement. The respective obligations of each party under this Agreement to
consummate the Merger shall be subject to the satisfaction, or, where
permissible under applicable law, waiver at or prior to the Effective Time of
the following conditions:
(a) Approval of Raritan Stockholders; SEC Registration. This
Agreement and the transactions contemplated hereby shall have been approved by
the requisite vote of the stockholders of Raritan and the shareholders of
United. The Registration Statement shall have been declared effective by the SEC
and shall not be subject to a stop order or any threatened stop order, and the
issuance of the United Common Stock shall have been qualified in every state
where such qualification is required under the applicable state securities laws.
The United Common Stock to be issued in connection with the Merger, including
United Common Stock to be issued for the Raritan Options, shall have been
approved for listing on the NASDAQ/NMS.
(b) Regulatory Filings. All necessary regulatory or
governmental approvals and consents (including without limitation any required
approval of the Commissioner, the FDIC, the OCC and any approval or waiver
required by the FRB) required to consummate the transactions contemplated hereby
shall have been obtained without any term or condition which would materially
impair the value of Raritan and the Bank, taken as a whole, to United. All
conditions required to be satisfied prior to the Effective Time by the terms of
such approvals and consents shall have been satisfied; and all statutory waiting
periods in respect thereof shall have expired.
(c) Suits and Proceedings. No order, judgment or decree shall
be outstanding against a party hereto or a third party that would have the
effect of preventing completion of the Merger; no Legal Proceeding shall be
pending or threatened by any governmental body in which it is sought to restrain
or prohibit the Merger or the Bank Merger.
(d) Tax Free Exchange. United and Raritan shall have received
an opinion, satisfactory to United and Raritan, of Pitney, Hardin, Kipp & Szuch,
counsel for United, issued in reliance on tax representation letters from United
and Raritan that are customary and reasonable under the circumstances, to the
effect that the transactions contemplated hereby will result in a reorganization
(as defined in Section 368(a) of the Code), and accordingly no gain or loss will
be recognized for federal income tax purposes to United, Raritan, UNB or the
Bank or to the stockholders of Raritan who exchange their shares of Raritan for
United Common Stock (except to the extent that cash is received in lieu of
fractional shares of United Common Stock).
(e) Pooling of Interests. The Merger shall be qualified to be
treated by United as a pooling-of-interests for accounting purposes and United
shall have received a letter from KPMG Peat Marwick LLP to the effect that the
Merger will qualify for pooling-of-interests accounting treatment if closed and
consummated in accordance with this Agreement.
6.2. Conditions to the Obligations of United Under this
Agreement. The obligations of United under this Agreement shall be further
subject to the satisfaction or waiver, at or prior to the Effective Time, of the
following conditions:
(a) Representations and Warranties; Performance of Obligations
of Raritan and Bank. The representations and warranties of Raritan contained in
this Agreement, other than representations and warranties which are expressly
stated to be made as of the date hereof or as of any other particular date,
shall be true and correct on the Closing Date as though made on and as of the
Closing Date. Raritan shall have performed in all material respects the
agreements, covenants and obligations necessary to be performed by it prior to
the Closing Date. With respect to any representation or warranty which as of the
Closing Date has required a supplement or amendment to the Raritan Disclosure
Schedule to render such representation or warranty true and correct as of the
Closing Date, the representation and warranty shall be deemed true and correct
as of the Closing Date only if (i) the information contained in the supplement
or amendment to the Disclosure Schedule related to events occurring following
the execution of this Agreement and (ii) the facts disclosed in such supplement
or amendment would not either alone, or together with any other supplements or
amendments to the Raritan Disclosure Schedule, materially adversely effect the
representation as to which the supplement or amendment relates. In interpreting
this Section 6.2(a) and Section 7.1(d) hereof, no representation or warranty of
Raritan shall be deemed untrue or incorrect, and Raritan shall not be deemed to
have breached a representation or warranty, as a consequence of any fact, event
or circumstance unless such fact, event or circumstance, individually or taken
together with all other facts, events or circumstances inconsistent with any
representation or warranty of Raritan contained in this Agreement has had or is
reasonably likely to have a material adverse effect on Raritan and the Bank,
taken as a whole, from that disclosed by Raritan on the date of this Agreement.
(b) Consents. United shall have received the written consents
of any person whose consent to the transactions contemplated hereby is required
under the applicable instrument.
(c) Opinion of Counsel. United shall have received an opinion
of counsel to Raritan, dated the date of the Closing, in form and substance
reasonably satisfactory to United, covering the matters set forth on Schedule
6.2 hereto and any other matters reasonably requested by United.
(d) Bank Action. The Bank shall have taken all necessary
corporate action to effectuate the Bank Merger immediately following the
Effective Time.
(e) Certificates. Raritan shall have furnished United with
such certificates of its officers or other documents to evidence fulfillment of
the conditions set forth in this Section 6.2 as United may reasonably request.
(f) Environmental Law Compliance. Raritan shall have obtained,
with respect to each Facility, an LNA, a Remediation Agreement, a Negative
Declaration approval, a Remedial Action Workplan approval (in which event
Raritan will post or have posted an appropriate Remediation Funding Source or
will have obtained the NJDEP's approval to self-guaranty any Remediation Funding
Source required under any such Remediation Agreement), a No Further Action
letter or other document or documents issued by the NJDEP advising that the
requirements of ISRA have been satisfied with respect to the Facility or an
opinion of the type referred to in Section 5.20(d) hereof.
6.3. Conditions to the Obligations of Raritan Under this
Agreement. The obligations of Raritan under this Agreement shall be further
subject to the satisfaction or waiver, at or prior to the Effective Time, of the
following conditions:
(a) Representations and Warranties; Performance of Obligations
of United. The representations and warranties of United contained in this
Agreement, other than representations and warranties which are expressly stated
to be made as of the date hereof or as of any other particular date, shall be
true and correct in all material respects on the Closing Date as though made on
and as of the Closing Date. United shall have performed in all material
respects, the agreements, covenants and obligations to be performed by it prior
to the Closing Date. With respect to any representation or warranty which as of
the Closing Date has required a supplement or amendment to the United Disclosure
Schedule to render such representation or warranty true and correct as of the
Closing Date, the representation and warranty shall be deemed true and correct
as of the Closing Date only if (i) the information contained in the supplement
or amendment to the Disclosure Schedule related to events occurring following
the execution of this Agreement and (ii) the facts disclosed in such supplement
or amendment would not either alone, or together with any other supplements or
amendments to the United Disclosure Schedule, materially adversely effect the
representation as to which the supplement or amendment relates. In interpreting
this Section 6.3(a) and Section 7.1(e) hereof, no representation or warranty of
United shall be deemed untrue or incorrect, and United shall not be deemed to
have breached a representation or warranty, as a consequence of any fact, event
or circumstance unless such fact, event or circumstance, individually or taken
together with all other facts, events or circumstances inconsistent with any
representation or warranty of United contained in this Agreement has had or is
reasonably likely to have a material adverse effect on United and UNB, taken as
a whole, from that disclosed by United on the date of this Agreement.
(b) Opinion of Counsel to United. Raritan shall have received
an opinion of counsel to United, dated the date of the Closing, in form and
substance reasonably satisfactory to Raritan, covering the matters set forth on
Schedule 6.3 hereto and any other matter reasonably requested by Raritan.
(c) Fairness Opinion. Raritan shall have received an opinion
from Endicott as of the date of this Agreement and the date the Joint Proxy
Statement/Prospectus is mailed to Raritan's stockholders, with respect to the
fairness, from a financial point of view, of the Exchange Ratio to the
shareholders of Raritan in the Merger.
(d) Raritan Directors. Each of United and UNB shall have taken
all action necessary to appoint two current Raritan directors to its Board of
Directors as specified in Section 5.15.
(e) Certificates. United shall have furnished Raritan with
such certificates of its officers or others and such other documents to evidence
fulfillment of the conditions set forth in this Section 6.3 as Raritan may
reasonably request.
(f) UNB Action. UNB shall have taken all necessary corporate
action to effectuate the Bank Merger immediately following the Effective Time.
ARTICLE VII
TERMINATION, AMENDMENT AND WAIVER
7.1. Termination. This Agreement may be terminated prior to
the Effective Time, whether before or after approval of this Agreement by the
stockholders of Raritan:
(a) By mutual written consent of the parties hereto.
(b) By United or Raritan (i) if the Effective Time shall not
have occurred on or prior to the Cutoff Date or (ii) if a vote of the
stockholders of Raritan is taken and such stockholders fail to approve this
Agreement at the meeting (or any adjournment thereof) held for such purpose, or
(iii) if a vote of the shareholders of United is taken and such shareholders
fail to approve this Agreement at the meeting (or any adjournment thereof) held
for such purpose, unless in each case the failure of such occurrence shall be
due to the failure of the party seeking to terminate this Agreement to perform
or observe its agreements set forth herein to be performed or observed by such
party (or, in the case of Raritan, to be performed or observed by the directors
of Raritan) at or before the Effective Time.
(c) By United or Raritan upon written notice to the other if
any application for regulatory or governmental approval necessary to consummate
the Merger and the other transactions contemplated hereby shall have been denied
or withdrawn at the request or recommendation of the applicable regulatory
agency or governmental authority or by United upon written notice to Raritan if
any such application is approved with conditions which materially impair the
value of Raritan and the Bank, taken as a whole, to United.
(d) By United if (i) there shall have occurred a material
adverse change in the business, operations, assets, or financial condition of
Raritan or the Bank, taken as a whole, from that disclosed by Raritan on the
date of this Agreement; or (ii) there was a material breach in any
representation, warranty, covenant, agreement or obligation of Raritan
hereunder.
(e) By Raritan, if (i) there shall have occurred a material
adverse change in the business, operations, assets or financial condition of
United or UNB from that disclosed by United on the date of this Agreement; or
(ii) there was a material breach in any representation, warranty, covenant,
agreement or obligation of United hereunder.
(f) By United or Raritan if any condition to Closing specified
under Article VI hereof applicable to such party cannot reasonably be met on or
before the Cutoff Date after giving the other party a reasonable opportunity to
cure any such condition.
(g) by Raritan, if (either before or after the approval of
this Agreement by the stockholders of Raritan) its Board of Directors so
determines by a vote of a majority of the members of its entire Board, at any
time during the three business day period commencing with (and including) the
Determination Date, if both of the following conditions are satisfied:
(x) the Average Pre-Closing Price of United Common
Stock on the Determination Date (the "Determination Price"), is less than the
United Floor Price. The "United Floor Price" is 85% of the United Average
Starting Date Price. The "United Average Starting Date Price" is the average of
the high and low sale price of United Common Stock (i.e., $26.188) on September
21, 1998 (the "Starting Date"), as the same shall be adjusted to reflect any
Capital Change; and
(y) (i) the quotient obtained by dividing the
Determination Price by the United Average Starting Date Price (the "United
Ratio") is less than (ii) the quotient obtained by dividing the number
calculated using the index of financial institutions set forth on Exhibit B
hereto (the "Index Price") as of the close of business on the Determination Date
by the Index Price as of the close of business on the Starting Date and
subtracting 0.10 from the quotient in this clause (y)(ii) (such number being
referred to herein as the "Index Ratio").
Notwithstanding the foregoing, if Raritan elects to exercise
its termination right pursuant to this subsection (g), it shall give prompt
written notice to United (provided that such notice of election to terminate may
be withdrawn at any time within the aforementioned three business day period)).
During the two business day period commencing with its receipt of such notice,
United shall have the option of increasing the consideration to be received by
the holders of Raritan Common Stock hereunder by increasing the Exchange Ratio
to equal the lesser of (i) a number (rounded to four decimals) equal to a
quotient, the numerator of which is the United Floor Price multiplied by the
Exchange Ratio (as then in effect) and the denominator of which is the
Determination Price, and (ii) a number (rounded to four decimals) equal to a
quotient, the numerator of which is the Index Ratio multiplied by the Exchange
Ratio (as then in effect) and the denominator of which is the United Ratio. If
United makes an election contemplated by the preceding sentence, within such two
business day period, it shall give prompt written notice to Raritan of such
election and the revised Exchange Ratio, whereupon no termination shall have
occurred pursuant to this subsection (g) and this Agreement shall remain in
effect in accordance with its terms (except as the Exchange Ratio shall have
been so modified), and any references in this Agreement to "Exchange Ratio"
shall thereafter be deemed to refer to the Exchange Ratio as adjusted pursuant
to this subsection (g).
7.2. Effect of Termination. In the event of the termination
and abandonment of this Agreement by either United or Raritan pursuant to
Section 7.1, this Agreement shall forthwith become void and have no effect,
without any liability on the part of any party or its officers, directors or
stockholders, except that Sections 5.5(b) and 8.1 hereof shall have continuing
effect as set forth therein. Nothing contained herein, however, shall relieve
any party from any liability for any breach of this Agreement.
7.3. Amendment. This Agreement may be amended by mutual action
taken by the parties hereto at any time before or after adoption of this
Agreement by the stockholders of Raritan and, if required, by the shareholders
of United, but, after any such adoption, no amendment shall be made which, under
applicable New Jersey or Delaware law, cannot be made without the approval of
the stockholders of Raritan or the shareholders of United, as the case may be,
without obtaining such approval. This Agreement may not be amended except by an
instrument in writing signed on behalf of United and Raritan.
7.4. Extension; Waiver. The parties may, at any time prior to
the Effective Time of the Merger, (i) extend the time for the performance of any
of the obligations or other acts of the other parties hereto; (ii) waive any
inaccuracies in the representations and warranties contained herein or in any
document delivered pursuant thereto; or (iii) waive compliance with any of the
agreements or conditions contained herein. Any agreement on the part of any
party to any such extension or waiver shall be valid only if set forth in an
instrument in writing signed on behalf of such party against which the waiver is
sought to be enforced.
ARTICLE VIII
MISCELLANEOUS
8.1. Expenses. All costs and expenses incurred in connection
with this Agreement and the transactions contemplated hereby (including legal,
accounting and investment banking fees and expenses) shall be borne by the party
incurring such costs and expenses, except that the cost of printing and mailing
the Joint Proxy Statement/Prospectus shall be borne equally by the parties
hereto if the transaction is terminated.
8.2. Notices. All notices or other communications which are
required or permitted hereunder shall be in writing and sufficient if delivered
personally or sent by telecopier with confirming copy sent the same day by
registered or certified mail, postage prepaid, as follows:
(a) If to United, to:
United National Bancorp
1130 Route 22 East, P.O. Box 6000
Bridgewater, New Jersey 08807-0010
Attn.: Thomas C. Gregor, Chairman,
President and Chief Executive Officer
With a copy to:
Pitney, Hardin, Kipp & Szuch
Attn.: Michael W. Zelenty, Esq.
By Hand: 200 Campus Drive
Florham Park, New Jersey 07932-0950
By Mail: P.O. Box 1945
Morristown, New Jersey 07962-1945
(b) If to Raritan, to:
Raritan Bancorp Inc.
454 Route 28
Bridgewater, New Jersey 08807
Attn.: Arlyn D. Rus, Chairman,
President and Chief Executive Officer
With a copy to:
Luse Lehman Gorman Pomerenk & Schick PC
5335 Wisconsin Avenue N.W.
Washington, D.C. 20015
Attn.: John J. Gorman
or such other addresses as shall be furnished in writing by
any party, and any such notice or communications shall be deemed to have been
given as of the date so delivered or telecopied and mailed.
8.3. Parties in Interest. This Agreement shall be binding upon
and shall inure to the benefit of the parties hereto and their respective
successors and permitted assigns. Nothing in this Agreement is intended to
confer, expressly or by implication, upon any other person any rights or
remedies under or by reason of this Agreement, except for the indemnitees
covered by Section 5.14 hereof. No assignment of this Agreement may be made
except upon the written consent of the other parties hereto.
8.4. Entire Agreement. This Agreement, the Disclosure
Schedules hereto and the other documents, agreements and instruments executed
and delivered pursuant to or in connection with this Agreement, contains the
entire agreement between the parties hereto with respect to the transactions
contemplated by this Agreement and supersedes all prior negotiations,
arrangements or understandings, written or oral, with respect thereto; provided,
however, that if this Agreement is terminated, the terms of Section 5.5(b) and
(c) and the terms of the Confidentiality Agreement between United and Raritan
dated August 19, 1998 shall remain in effect. If any provision of this Agreement
is found invalid, it shall be considered deleted and shall not invalidate the
remaining provisions.
8.5. Counterparts. This Agreement may be executed in one or
more counterparts, all of which shall be considered one and the same agreement
and each of which shall be deemed an original.
8.6. Governing Law. This Agreement shall be governed by the
laws of the State of New Jersey, without giving effect to the principles of
conflicts of laws thereof.
8.7. Descriptive Headings. The descriptive headings of this
Agreement are for convenience only and shall not control or affect the meaning
or construction of any provision of this Agreement.
8.8. Survival. All representations, warranties and, except to
the extent specifically provided otherwise herein, agreements and covenants,
other than those agreements and covenants set forth in Section 5.14 which shall
survive the Merger, shall terminate as of the Effective Time.
8.9. Knowledge. Representations made herein which are
qualified by the phrase to the best of Raritan's knowledge or similar phrases
refer as of the date hereof to the best knowledge of the Chief Executive Officer
and the Chief Lending Officer of Raritan and thereafter refer to the best
knowledge of any senior officer of Raritan or any Raritan subsidiary.
Representations made herein which are qualified by the phrase to the best of
United's knowledge or similar phrases refer as of the date hereof to the best
knowledge of the Chief Executive Officer, the Executive Vice President/Legal and
the Chief Financial Officer of United and thereafter refer to the best knowledge
of any senior officer of United or any United subsidiary.
[Remainder of this page intentionally left blank]
<PAGE>
IN WITNESS WHEREOF, United, UNB, the Bank and Raritan have
caused this Agreement to be executed by their duly authorized officers as of the
day and year first above written.
<TABLE>
<CAPTION>
<S> <C>
ATTEST: UNITED NATIONAL BANCORP
____________________________ By:__________________________________________
Ralph L. Straw, Jr., Secretary Thomas C. Gregor, Chairman, President
and Chief Executive Officer
ATTEST: RARITAN BANCORP INC.
____________________________ By:_________________________________________
Helen J. Frangelli, Secretary Arlyn D. Rus, Chairman, President
and Chief Executive Officer
ATTEST: UNITED NATIONAL BANK
____________________________ By:__________________________________________
Ralph L. Straw, Jr., Cashier Thomas C. Gregor, Chairman, President
and Chief Executive Officer
ATTEST: THE RARITAN SAVINGS BANK
_____________________________ By:__________________________________________
Helen J. Frangelli, Secretary Arlyn D. Rus, Chairman, President
and Chief Executive Officer
</TABLE>
<PAGE>
CERTIFICATE OF THE DIRECTORS OF
RARITAN BANCORP INC. AND
THE RARITAN SAVINGS BANK
Reference is made to the Agreement and Plan of Merger, dated
as of September 22, 1998 (the "Agreement"), among United National Bancorp,
United National Bank, Raritan Bancorp Inc., and The Raritan Savings Bank.
Capitalized terms used herein have the meanings given to them in the Agreement.
Each of the following persons, being all of the directors of
Raritan and the Bank, agrees to vote or cause to be voted all shares of Raritan
Common Stock which are held by such person, or over which such person exercises
full voting control (other than shares with respect to which such person
exercises control in a fiduciary capacity, as to which no agreement is made
hereby), in favor of the Merger.
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<PAGE>
Exhibit A to Merger Agreement
AGREEMENT TO MERGE BETWEEN
UNITED NATIONAL BANK
AND
THE RARITAN SAVINGS BANK
UNDER THE CHARTER OF UNITED NATIONAL BANK,
UNDER THE TITLE OF UNITED NATIONAL BANK
THIS AGREEMENT made between United National Bank (hereinafter
referred to as "UNB"), a national banking association organized under the laws
of the United States, being located at 1130 Route 22 East, Bridgewater, County
of Somerset in the State of New Jersey, with a capital of $__________ divided
into __________ shares of common stock, each of $_____ par value, $__________ of
surplus, and undivided profits of $__________ as of June 30, 1998, and The
Raritan Savings Bank (hereinafter referred to as "Bank"), a federally-chartered
savings bank organized under the laws of the United States, being located at
____________________, with a capital of $__________, divided into _____ shares
of common stock, each of $_____ par value, surplus of $__________, and undivided
profits of $__________ as of June 30, 1998, each acting pursuant to a resolution
of its board of directors, adopted by the vote of a majority of its directors,
pursuant to the authority given by and in accordance with the provisions of the
Act of November 7, 1918, as amended (12 U.S.C. Section 215(a)), and the New
Jersey Banking Act of 1948, as amended, witnesseth as follows:
Section 1. Bank shall be merged into UNB under the charter of
UNB.
Section 2. The name of the receiving association (hereinafter
referred to as the "Surviving Bank") shall be United National Bank.
Section 3. The business of the Surviving Bank shall be that of
a national banking association. This business shall be conducted by the
Surviving Bank at its main office which shall be located at 1130 Route 22 East,
Bridgewater, Somerset County, New Jersey, and at its legally established
branches.
Section 4. The amount of capital stock of the Surviving Bank
shall be $__________, divided into __________ shares of common stock, each of
$_____ par value, and at the time the merger shall become effective, the
Surviving Bank shall have a surplus of $__________, and undivided profits,
including capital reserves, which when combined with the capital and surplus
will be equal to the combined capital structures of the merging banks as stated
in the preamble of this Agreement, adjusted however, for normal earnings and
expenses between June 30, 1998, and the effective time of the merger.
Section 5. All assets of each of the merging banks, as they
exist at the effective time of the merger, shall pass to and vest in the
Surviving Bank without any conveyance or other transfer. The Surviving Bank
shall be responsible for all of the liabilities of every kind and description,
including liabilities arising from the operation of their respective trust
departments, of each of the merging banks existing as of the effective time of
the merger. After the effective time of the merger, UNB will continue to
maintain the Bank liquidation account established by Bank upon its conversion to
the stock form of organization for the benefit of eligible account holders. In
addition, UNB will also continue to maintain the Bank liquidation account
established in conjunction with the merger and acquisition of Manville Savings
with, and into the Bank. UNB will maintain both of the aforementioned
liquidation accounts on the same basis as immediately prior to the effective
time of the merger, and Bank's liquidation accounts for the benefit of eligible
account holders shall automatically be deemed assumed by UNB, as of the
effective time of the merger, on the same basis as they existed immediately
prior to the effective time of the merger.
Section 6. Bank shall contribute to the Surviving Bank its
capital set forth in the preamble, adjusted, however, for normal earnings,
expenses and dividends between June 30, 1998, and the effective time of the
merger.
UNB shall have on hand at the effective time of the merger its
capital as set forth in the preamble, adjusted, however, for normal earnings,
expenses and dividends between June 30, 1998 and the effective date of the
merger.
Section 7. The stockholders of UNB shall retain their rights
in the capital stock presently outstanding, which shall immediately and
automatically become __________ shares of common stock of the Surviving Bank,
each with $_____ par value, and the stockholders of Bank in exchange for the
excess acceptable assets contributed by their bank to the Surviving Bank shall
be entitled to receive _____ shares of common stock of the Surviving Bank, each
with $_____ par value.
Section 8. Neither of the banks shall declare nor pay any
dividend to its stockholders between the date of this Agreement and the time at
which the merger shall become effective, nor dispose of any of its assets in any
other manner except in the ordinary course of business consistent with prudent
banking practice; provided, however, that UNB shall be entitled to pay dividends
to its parent without restriction and Bank may pay dividends to it parent
consistent with past practice, so long as the payment of such dividends shall
thereby not cause a breach of any representation, covenant, agreement or
condition to which the Bank is subject under the Amended and Restated Agreement
and Plan of Merger, dated as of September 22, 1998 among United National
Bancorp, Raritan Bancorp Inc., UNB and Bank (the "Merger Agreement").
Section 9. The present board of directors of UNB shall serve
as the board of directors of the Surviving Bank until the next annual meeting or
until such time as their successors have been elected and have qualified. [add
two Raritan directors]
Section 10. Effective as of the time this merger shall become
effective as specified in the merger approval to be issued by the Office of the
Comptroller of the Currency (the "OCC"), the articles of association of the
resulting bank shall read in their entirety as set forth in Schedule 1 annexed
hereto.
Section 11. This Agreement shall be terminated automatically
if the Merger Agreement is terminated as provided in the Merger Agreement.
Section 12. This Agreement shall be ratified and confirmed by
the affirmative vote of the stockholders of each of the merging banks owning at
least two-thirds of its capital stock outstanding, at a meeting to be held on
the call of the directors; and the merger shall become effective at the time
specified in the merger approval to be issued by the OCC.
Section 13. Each of the representations, warranties and
covenants of the parties hereto shall terminate as of the effective time of the
merger, other than Section 5 hereof which shall survive the effective time of
the merger.
Section 14. This Agreement may be executed in any number of
counterparts, and each counterpart shall constitute an original instrument, but
all such separate counterparts shall constitute only one and the same
instrument.
Section 15. Except as governed by federal law, the validity,
construction and enforceability of this Agreement shall be governed in all
respects by the laws of the State of New Jersey without regard to its conflicts
of laws or rules.
WITNESS, the signatures and seals of the merging banks as of
this __________, each set by its president or a vice president and attested to
by its cashier or secretary, pursuant to a resolution of its board of directors,
acting by a majority.
ATTEST: UNITED NATIONAL BANK
_______________________ By:____________________________________
ATTEST: THE RARITAN SAVINGS BANK
________________________ By:____________________________________
<PAGE>
STATE OF NEW JERSEY )
: ss.
COUNTY OF __________ )
On this ____ day of __________, before me, a Notary Public for
this state and county, personally came ____________________, of UNITED NATIONAL
BANK, and each of his/her capacity acknowledged this instrument to the act and
deed of the association and the seal affixed to it to be its seal.
WITNESS my official seal and signature this day and year.
----------------------------
(Seal of Notary)
<PAGE>
STATE OF NEW JERSEY )
:ss.
COUNTY OF ___________)
On this _____ day of __________, before me, a Notary Public
for this state and county, personally came ____________________, of THE RARITAN
SAVINGS BANK, and each of his/her capacity acknowledged this instrument to the
act and deed of the association and the seal affixed to it to be its seal.
WITNESS my official seal and signature this day and year.
----------------------------
(Seal of Notary)
<PAGE>
Schedule 1 to Bank Merger Agreement
ARTICLES OF ASSOCIATION
OF
UNITED NATIONAL BANK1
NAME
FIRST. The title of the Association shall be "United National
Bank".
MAIN OFFICE
SECOND. The main office of the Association shall be at 1130
Route 22 East, Bridgewater, Somerset County, New Jersey. The general business of
the Association shall be conducted at its legally established branches.
DIRECTORS
THIRD. The Board of Directors of this Association shall
consist of not less than five nor more than twenty-five shareholders. At any
meeting of the shareholders held for the purpose of electing Directors, or
changing the number thereof, the number of Directors may be determined by a
majority of the votes cast by the shareholders in person or by proxy. A majority
of the Board of Directors shall be necessary to constitute a quorum for the
transaction of business at any Directors' meeting.
The Board of Directors of the Association may be increased by
two between annual meetings of shareholders and vacancies on the Board may be
filled between annual meetings of the shareholders by a majority vote of the
full Board, but in no event shall the number of Directors exceed the total
number of twenty-five or such greater amount as may from time to time be
permitted by the laws of the United States. Any Director so elected by the Board
must comply with the provisions of law with respect to the ownership of shares
of the Association.
ANNUAL MEETING OF DIRECTORS
FOURTH. The regular annual meeting of the shareholders of this
Association shall be held at its main office or other convenient place duly
authorized by the Board of Directors on such day of the year as is specified
therefor in the By-Laws.
CAPITAL
FIFTH. The amount of authorized capital stock of this
Association shall be $__________ divided into __________ shares of common stock
of the par value per share of $_____ but said capital stock may be increased or
decreased from time to time in accordance with the provisions of the laws of the
United States.
If the capital stock is increased by the sale of additional
shares thereof, each shareholder shall be entitled to subscribe for such
additional shares in proportion to the number of shares of said capital stock
owned by him at the time the increase is authorized by the shareholders, unless
another time subsequent to the date of the shareholders' meeting is specified in
a resolution adopted by the shareholders at the time the increase is authorized.
The Board of Directors shall have the power to prescribe a reasonable period of
time within which the preemptive rights to subscribe to the new shares of
capital stock must be exercised.
If the capital stock is increased by a stock dividend, each
shareholder shall be entitled to his proportionate amount of such increase in
accordance with the number of shares of capital stock owned by him at the time
the increase is authorized by the shareholders, unless another time subsequent
to the date of the shareholders' meeting is specified in a resolution adopted by
the shareholders at the time the increase is authorized.
OFFICERS
SIXTH. The Board of Directors shall appoint one of its members
President of this Association, who shall be Chairman of the Board, unless the
Board appoints another director to be Chairman. The Board of Directors shall
have the power to appoint one or more Vice Presidents, at least one of whom
shall be authorized, in the absence of the President, to perform all acts and
duties pertaining to the office of the President; to appoint a Cashier and such
other officers and employees as may be required to transact the business of this
Association; to fix the salaries to be paid to such officers or employees and
appoint others to take their place.
The Board of Directors shall have the power to define the
duties of the officers and employees of this Association and to require adequate
bonds from them for the faithful performance of their duties; to make all
By-Laws that may be lawful for the general regulation of the business of this
Association and the management of its affairs, and generally to do and perform
all acts that may be lawful for a Board of Directors to do and perform.
CHANGE OF MAIN OFFICE; BRANCHES
SEVENTH. The Board of Directors shall have the power to change
the location of the main office of this Association to any other place within
the limits of the State of New Jersey, without the approval of the shareholders
of this Association but subject to the approval of the Comptroller of the
Currency; and shall have the power to change the location of any branch or
branches of this Association to any other location, without the approval of the
shareholders of this Association but subject to the approval of the Comptroller
of the Currency.
EXISTENCE
EIGHTH. The corporate existence of this Association shall
continue until terminated in accordance with the laws of the United States.
SPECIAL MEETINGS OF SHAREHOLDERS; NOTICE OF MEETINGS
NINTH. The Board of Directors of this Association, or any
three or more shareholders owning, in the aggregate, not less than 10 per centum
(10%) of the stock of this Association, may call a special meeting of the
shareholders at any time.
Unless otherwise provided by the laws of the United States, a
notice of the time, place and purpose of every regular annual, and every special
meeting of the shareholders shall be given by first class mail, postage prepaid,
mailed at least ten days prior to the date of such meeting to each shareholder
of record at his address as shown upon the books of this Association.
INDEMNIFICATION
TENTH. Indemnification or reimbursement may be given to an
officer or director, as authorized by the Board of Directors, for expenses
incurred in any legal action where the officer or director is not adjudged to be
guilty of gross negligence, willful misconduct or criminal acts in the
performance of his duties to the Association.
AMENDMENT
ELEVENTH. Subject to the provisions of the laws of the United
States, these Articles of Association may be amended at any meeting of the
shareholders for which adequate notice has been given, by the affirmative vote
of the owners of a majority of the stock of this Association, voting in person
or by proxy.
<PAGE>
EXHIBIT 5.19
RARITAN AFFILIATE LETTER
___________, 1998
United National Bancorp
1130 Route 22 East, P.O. Box 6000
Bridgewater, New Jersey 08807-0010
Attn.: Thomas C. Gregor, Chairman,
President and Chief Executive Officer
Gentlemen:
I am delivering this letter to you in connection with the
proposed merger (the "Merger") of Raritan Bancorp Inc., a Delaware corporation
(the "Company") with and into United National Bancorp, a New Jersey corporation
("United"), pursuant to the Amended and Restated Agreement and Plan of Merger
dated as of September 22, 1998 (the "Agreement") among the Company, United, The
Raritan Savings Bank and United National Bank. I currently own shares of the
Company's common stock, par value $.01 per share ("Raritan Common Stock"). As a
result of the Merger, I will receive shares of United's common stock, $1.25 par
value ("United Common Stock") in exchange for my Raritan Common Stock. In
addition, to the extent I own options to acquire Raritan Common Stock, those
options will be converted in the Merger into United Common Stock or options to
acquire United Common Stock.
I have been advised that as of the date of this letter I may
be deemed to be an "affiliate" of the Company, as the term "affiliate" is
defined for purposes of paragraphs (c) and (d) of Rule 145 of the rules and
regulations promulgated under the Securities Act of 1933, as amended (the "Act")
by the Securities and Exchange Commission (the "Commission") and as the term
"affiliate" is used for purposes of the Commission's rules and regulations
applicable to the determination of whether a merger can be accounted for as a
"pooling of interests" as specified in the Commission's Accounting Series
Release 135, as amended by Staff Accounting Bulletins Nos. 65 and 76 ("ASR
135").
I represent to and covenant with United that:
A. Initial Transfer Restrictions Prior to Merger Consummation.
During the period beginning on the date hereof and ending 30 days prior to the
consummation of the Merger, I shall not sell, transfer or otherwise dispose of
("transfer") any Raritan Common Stock owned by me, and I shall not permit any
relative who shares my home, or any person or entity who or which I control,
from transferring any Raritan Common Stock owned by such person or entity,
without notifying United in advance of the proposed transfer and giving United a
reasonable opportunity to object to the transfer before it is consummated.
United, upon advice of its independent public accountants, may instruct me not
to make or permit the transfer because it may interfere with the "pooling of
interests" treatment of the Merger. I shall abide by any such instructions.
B. Later Pre-Merger and Post-Consummation Transfer
Restrictions. During the period beginning 30 days prior to the consummation of
the Merger and ending immediately after financial results covering at least 30
days of post-Merger combined operations have been published by United by means
of the filing of a Form 10-Q or Form 8-K under the Securities Exchange Act of
1934, as amended, the issuance of a quarterly earnings report, or any other
public issuance which satisfies the requirements of ASR 135, I shall not
transfer any Raritan Common Stock owned by me, and I shall not permit any
relative who shares my home, or any person or entity who or which I control, to
transfer any Raritan Common Stock owned by such person or entity. For purposes
of this paragraph, "Raritan Common Stock" includes the United Common Stock into
which the Raritan Common Stock or Options is converted.
C. Need for Registration or Exemption in Connection with
Transfers. I have been advised that the issuance of United Common Stock to me
pursuant to the Merger will be registered with the Commission under the Act on a
Registration Statement on Form S-4. However, I have also been advised that,
since I may be deemed to be an affiliate of the Company at the time the Merger
is submitted for a vote of the Company's stockholders, any transfer by me of
United Common Stock received by me in the Merger is restricted under Rule 145
promulgated by the Commission under the Act. I may not transfer United Common
Stock received by me or by any relative who shares my home or by any person or
entity who or which I control, unless (i) such transfer is registered under the
Act, (ii) such transfer is made in conformity with the volume and other
limitations of Rule 145 promulgated by the Commission under the Act, or (iii) in
the opinion of counsel reasonably acceptable to United, such transfer is
otherwise exempt from registration under the Act.
D. Stop Transfer Instructions; Legend on Certificates. I also
understand that stop transfer instructions will be given to United's transfer
agents with respect to the United Common Stock and that there will be placed on
the certificates of the United Common Stock issued to me or to any relative who
shares my home or to any person or entity who or which I control, or any
substitutions therefor, a legend stating in substance:
"THE SHARES REPRESENTED BY THIS CERTIFICATE WERE ISSUED IN A
TRANSACTION TO WHICH RULE 145 PROMULGATED UNDER THE SECURITIES ACT OF 1933
APPLIES. THE SHARES REPRESENTED BY THIS CERTIFICATE MAY ONLY BE TRANSFERRED IN
ACCORDANCE WITH THE TERMS OF AN AGREEMENT DATED SEPTEMBER 22, 1998 BETWEEN THE
REGISTERED HOLDER HEREOF AND UNITED NATIONAL BANCORP, A COPY OF WHICH AGREEMENT
IS ON FILE AT THE PRINCIPAL OFFICE OF UNITED NATIONAL BANCORP."
E. Consultation with Counsel. I have carefully read this
letter and the Agreement and discussed the requirements of such documents and
other applicable limitations upon my ability to transfer United Common Stock to
the extent I felt necessary with my counsel or counsel for the Company.
Execution of this letter is not an admission on my part that I
am an "affiliate" of the Company as described in the second paragraph of this
letter, or a waiver of any rights I may have to object to any claim that I am
such an affiliate on or after the date of this letter. This letter shall
terminate concurrently with any termination of the Agreement in accordance with
its terms.
Very truly yours,
Name:
Accepted this ____ day of
_______________, 1998 by
UNITED NATIONAL BANCORP
By:
Name:
Title:
<PAGE>
EXHIBIT 5.19.1
UNITED AFFILIATE LETTER
____________, 1998
United National Bancorp
1130 Route 22 East, P.O. Box 6000
Bridgewater, New Jersey 08807-0010
Attn.: Thomas C. Gregor, Chairman,
President and Chief Executive Officer
Gentlemen:
I am delivering this letter to you in connection with the
proposed merger (the "Merger") of Raritan Bancorp Inc., a Delaware corporation
("Raritan") with and into United National Bancorp, a New Jersey corporation
("United"), pursuant to the Amended and Restated Agreement and Plan of Merger
dated as of September 22, 1998 (the "Agreement") among United, Raritan, United
National Bank and The Raritan Savings Bank. I currently own shares of United's
common stock, $1.25 par value ("United Common Stock").
I have been advised that as of the date of this letter I may
be deemed to be an "affiliate" of United, as the term "affiliate" is used for
purposes of the rules and regulations of the Securities and Exchange Commission
(the "Commission") applicable to the determination of whether a merger can be
accounted for as a "pooling of interests" as specified in the Commission's
Accounting Series Release 135, as amended by Staff Accounting Bulletins Nos. 65
and 76 ("ASR 135").
I represent and covenant with United and Raritan that:
A. Initial Transfer Restrictions Prior to Merger Consummation.
During the period beginning on the date hereof and ending 30 days prior to the
consummation of the Merger, I shall not sell, transfer or otherwise dispose of
("transfer") any United Common Stock owned by me, and I shall not permit any
relative who shares my home, or any person or entity who or which I control,
from transferring any United Common Stock owned by such person or entity,
without notifying United in advance of the proposed transfer and giving United a
reasonable opportunity to object to the transfer before it is consummated.
United, upon advice of its independent public accountants, may instruct me not
to make or permit the transfer because it may interfere with the "pooling of
interests" treatment of the Merger. I shall abide by any such instructions.
B. Later Pre-Merger and Post-Consummation Transfer
Restrictions. During the period beginning 30 days prior to the consummation of
the Merger and ending immediately after financial results covering at least 30
days of post-Merger combined operations have been published by United by means
of filing of a Form 10-Q or Form 8-K under the Securities Exchange Act of 1934,
the issuance of a quarterly earnings report, or any other public issuance which
satisfies the requirements of ASR 135, I shall not transfer any United Common
Stock owned by me, and I shall not permit any relative who shares my home, or
any person or entity who or which I control, to transfer any United Common Stock
owned by such person or entity.
C. Consultation with Counsel. I have carefully read this
letter and the Agreement and discussed the requirements of such documents and
other applicable limitations upon my ability to transfer United Common Stock to
the extent I felt necessary with my counsel or counsel for United.
Execution of this letter is not an admission on my part that I
am an "affiliate" of United as described in the second paragraph of this letter,
or a waiver of any rights I may have to object to any claim that I am such an
affiliate on or after the date of this letter. This letter shall terminate
concurrently with any termination of the Agreement in accordance with its terms.
Very truly yours,
-----------------------------
Name:
Accepted this ___ day of
____________, 1998 by
UNITED NATIONAL BANCORP
By: ___________________________
Name:
Title:
<PAGE>
SCHEDULE 6.2
FORM OF OPINION OF COUNSELS TO
RARITAN TO BE DELIVERED TO
UNITED AT THE EFFECTIVE TIME
(Capitalized terms used herein and not otherwise defined have the meanings
given them in the Agreement)
(a) Raritan is a corporation validly existing and in good
standing under the laws of the State of Delaware. Raritan has the corporate
power and authority to own or lease all of its properties and assets and to
carry on its business as described in the Joint Proxy Statement/Prospectus on
page __ under the caption _________________. Raritan is registered as a holding
company under the BHCA.
(b) Each Subsidiary of Raritan listed as such in the Raritan
Disclosure Schedule is validly existing and in good standing under the laws of
the jurisdiction of its incorporation. The Bank is a New Jersey-chartered stock
savings bank. The Bank has the corporate power and authority to own or lease all
of its properties and assets and to carry on its business as described in the
Joint Proxy Statement/Prospectus on page __ under the caption _________________.
(c) The authorized capital stock of Raritan consists of
__________ shares of Raritan Common Stock and _________ shares of Raritan
Preferred Stock. Except for any Raritan Common Stock issuable upon exercise of
outstanding Raritan Options granted pursuant to the Raritan Option Plans and the
United Stock Option, we have not become aware (through our representation of
Raritan in connection therewith or in the course of our representation of
Raritan in connection with the Agreement, or through Raritan's representations
to us in the attached certificate) of any outstanding subscription rights,
options, conversion rights, warrants or other agreements or commitments of any
nature whatsoever (either firm or conditional) obligating Raritan to issue,
deliver or sell, cause to be issued, delivered or sold, or restricting Raritan
from selling any Raritan Preferred Stock or any additional Raritan Common Stock
or obligating Raritan to grant, extend or enter into any such agreement or
commitment. Based solely upon our review of the minute books of Raritan and its
Subsidiaries, and without independent verification of the matters recited
therein, all of the outstanding shares of capital stock of each Subsidiary of
Raritan listed as such in the Raritan Disclosure Schedule have been validly
authorized and issued and we are not aware of any liens, claims, equities,
restrictions or encumbrances created by Raritan on Raritan's ownership thereof.
(d) The Agreement has been authorized, executed and delivered
by Raritan and the Bank and constitutes the valid and binding obligations of
Raritan and the Bank, respectively, enforceable in accordance with its terms,
except that the enforceability of the obligations of Raritan and the Bank may be
limited by bankruptcy, fraudulent conveyance, insolvency, reorganization,
moratorium, or laws affecting bank holding companies or New Jersey-chartered
stock savings banks or institutions the deposits of which are insured by the
FDIC or other laws heretofore or hereafter enacted relating to or affecting the
enforcement of creditors' rights generally and by principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law). In addition, certain remedial and other provisions of the
Agreement may be limited by implied covenants of good faith, fair dealing, and
commercially reasonable conduct, by judicial discretion, in the instance of
equitable remedies, and by applicable public policies and laws.
(e) The execution and delivery of the Agreement and the Bank
Merger Agreement and the consummation of the transactions contemplated thereby
will not (i) conflict with or violate any provision of or result in the breach
of any provision of the respective certificate of incorporation or charter, as
the case may be, or by-laws of Raritan or the Bank; (ii) conflict with or
violate in any material respect, or result in a material breach or violation of
the terms or provisions of, or constitute a default under, or result in (whether
upon or after the giving of notice or lapse of time or both) any material
obligation under, any indenture, mortgage, deed of trust or loan agreement or
any other agreement, instrument, judgment, order, arbitration award or decree of
which we are aware (through our representation of Raritan in connection
therewith or in the course of our representation of Raritan in connection with
the Agreement, or through Raritan's representations to us in the attached
certificate) and to which Raritan or the Bank is a party or by which Raritan or
the Bank is bound; or (iii) cause Raritan or the Bank to violate any law, rule
or regulation applicable to Raritan or the Bank: except with respect to (ii) and
(iii) above, such as in the aggregate will not have a material adverse effect on
the ability of Raritan and the Bank to consummate the transactions contemplated
by the Agreement.
(f) All actions of the directors and stockholders of Raritan
and of the Bank required by federal banking law or Delaware law, or by the
respective certificate of incorporation or charter, as the case may be, or
by-laws of Raritan or the Bank, to be taken by Raritan or the Bank to authorize
the execution, delivery and performance of the Agreement and consummation of the
Merger have been taken.
(g) No approvals, authorizations, consents or other actions or
filings under federal banking law or Delaware law ("Approvals") are required to
be obtained by Raritan or the Bank in order to permit the execution and delivery
of the Agreement by Raritan and the Bank and the performance by Raritan and the
Bank of the transactions contemplated thereby other than those Approvals which
have been obtained or those Approvals or consents required to be obtained by
United or UNB, or Approvals not required or necessary to be obtained on the date
hereof.
(h) Except as set forth in the Raritan Disclosure Schedule and
in Raritan's certificate addressed to us and attached hereto, and other than
ordinary routine litigation incidental to the business of Raritan or its
Subsidiaries, we are not aware of any material action, suit or proceeding or
investigation pending or threatened in writing against or affecting the
business, operations, property or financial condition of Raritan or any of its
Subsidiaries, at law or in equity, in any court or before any Federal, state,
municipal or other governmental department, commission, board, bureau, agency or
instrumentality, except those which, if decided adversely to Raritan or any of
its Subsidiaries, would not have a material adverse effect on Raritan and its
Subsidiaries, taken as a whole; provided, however, we are not counsel to Raritan
or its Subsidiaries in any litigation and with respect to litigation we are
relying upon the representation and warranty of Raritan made in Section 3.7 of
the Agreement with respect to material litigation and on Raritan's certificate
addressed to us and attached hereto.
*******
We are not passing upon and do not assume any responsibility
for the accuracy, completeness or fairness of the statements and information
contained in the Joint Proxy Statement/Prospectus and make no representation
that we have independently verified the accuracy, completeness or fairness of
such statements and information, but, without in any way limiting the generality
of the foregoing, based upon our review of the Joint Proxy Statement/Prospectus
(i) the Joint Proxy Statement/Prospectus (except for financial statements and
other tabular financial information, and other financial and statistical data
and information, as to which we express no opinion) complies as to form in all
material respects with the 1934 Act and the applicable laws and regulations
thereunder, (ii) no facts have come to our attention that caused us to believe
that (except for financial statements and other tabular financial information,
as to which we do not express any belief) the Joint Proxy Statement/Prospectus
on the date of the mailing thereof and on the date of the meeting of
stockholders of Raritan at which the Agreement was approved, contained any
untrue statement of a material fact with respect to Raritan or omitted to state
a material fact with respect to Raritan necessary in order to make the
statements therein with respect to Raritan, in light of the circumstances under
which they were made, not misleading.
*******
In rendering their opinion, counsel to Raritan (A) may, to the
extent they deem proper and so specify in their opinion, rely upon the opinion
of other counsel as to matters involving the application of laws of any
jurisdiction other than the United States, or may exclude from their opinion the
substance included in the opinions of other counsel given directly to Raritan
and (B) may rely, as to matters of fact, on certificates of responsible officers
of Raritan, the Bank, or other Subsidiaries of Raritan and public officials;
provided copies of any such opinions or certificates are delivered to Raritan
together with the opinion to be rendered hereunder by counsel to Raritan.
Counsel to Raritan may assume that any agreement is the valid and binding
obligation of any parties to such agreement other than Raritan and the Bank. As
to matters of fact, counsel to Raritan may also rely upon the representations
and warranties made by Raritan to Raritan in the Agreement as though such
representations and warranties were made directly to counsel. Counsel to Raritan
may also rely upon the genuineness of signatures and the authenticity of copies.
<PAGE>
SCHEDULE 6.3
FORM OF OPINION OF COUNSEL TO
UNITED TO BE DELIVERED TO
RARITAN AT THE EFFECTIVE TIME
(Capitalized terms used herein and not otherwise defined have the meanings
given them in the Agreement)
(a) United is a corporation validly existing and in good
standing under the laws of the State of New Jersey. United has the corporate
power and authority to own or lease all of its properties and assets and to
carry on its business as described in the Joint Proxy Statement/Prospectus on
page __ under the caption _________________. United is registered as a bank
holding company under the BHCA.
(b) Each Subsidiary of United listed as such in the United
Disclosure Schedule is validly existing and in good standing under the laws of
the jurisdiction of its incorporation. UNB is a national banking association
chartered under the laws of the United States. UNB has the corporate power and
authority to own or lease all of its properties and assets and to carry on its
business as described in the Joint Proxy Statement/Prospectus on page __ under
the caption _________________.
(c) The authorized capital stock of United consists of
___________ shares of common stock, ___ par value per share ("United Common
Stock"). Except for any United Common Stock issuable upon exercise of
outstanding stock options and stock appreciation rights granted pursuant to the
United Option Plan, we have not become aware (through our representation of
United in connection therewith or in the course of our representation of United
in connection with the Agreement, or through United's representations to us in
the attached certificate) of any outstanding subscription rights, options,
conversion rights, warrants or other agreements or commitments of any nature
whatsoever (either firm or conditional) obligating United to issue, deliver or
sell, cause to be issued, delivered or sold, or restricting United from selling
any additional United Common Stock or obligating United to grant, extend or
enter into any such agreement or commitment except as may be provided in any
acquisition agreement United may enter into after the date of execution of the
Agreement. Based solely upon our review of the minute books of United and its
Subsidiaries, and without independent verification of the matters recited
therein, all of the outstanding shares of capital stock of each Subsidiary of
United listed as such in the United Disclosure Schedule have been validly
authorized and issued and we are not aware of any liens, claims, equities,
restrictions or encumbrances created by United on United's ownership thereof.
The United Common Stock to be issued in connection with the Merger in accordance
with Article II of the Agreement, when so issued in accordance therewith, will
be duly authorized, validly issued, fully paid and non-assessable, free of
preemptive rights and free and clear of all liens, encumbrances or restrictions
created by United.
(d) The Agreement has been authorized, executed and delivered
by United and UNB and constitutes the valid and binding obligations of United
and UNB, respectively, enforceable in accordance with its terms, except that the
enforceability of the obligations of United and UNB may be limited by
bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, or
laws affecting institutions the deposits of which are insured by the FDIC or
other laws heretofore or hereafter enacted relating to or affecting the
enforcement of creditors' rights generally and by principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law). In addition, certain remedial and other provisions of the
Agreement may be limited by implied covenants of good faith, fair dealing, and
commercially reasonable conduct, by judicial discretion, in the instance of
equitable remedies, and by applicable public policies and laws.
(e) The execution and delivery of the Agreement and the Bank
Merger Agreement and the consummation of the transactions contemplated thereby
will not (i) conflict with or violate any provision of or result in the breach
of any provision of the respective certificates of incorporation or by-laws of
United or UNB; (ii) conflict with or violate in any material respect, or result
in a material breach or violation of the terms or provisions of, or constitute a
default under, or result in (whether upon or after the giving of notice or lapse
of time or both) any material obligation under, any indenture, mortgage, deed of
trust or loan agreement or any other agreement, instrument, judgment, order,
arbitration award or decree of which we are aware (through our representation of
United in connection therewith or in the course of our representation of United
in connection with the Agreement, or through United's representations to us in
the attached certificate) and to which United or UNB is a party or by which
United or UNB is bound; or (iii) cause United or UNB to violate any law, rule or
regulation applicable to United or UNB: except with respect to (ii) and (iii)
above, such as in the aggregate will not have a material adverse effect on the
ability of United and UNB to consummate the transactions contemplated by the
Agreement.
(f) All actions of the directors and stockholders of United
and of UNB required by federal banking law or New Jersey law, or by the
respective certificates of incorporation or by-laws of United or UNB, to be
taken by United or UNB to authorize the execution, delivery and performance of
the Agreement and consummation of the Merger have been taken.
(g) Assuming that there has been due authorization of the
Merger by all necessary corporate and governmental proceedings on the part of
Raritan and that Raritan has taken all action required to be taken by it prior
to the Effective Time, upon the appropriate filing of the Certificates of Merger
in respect of the Merger with the New Jersey Secretary of State and the Delaware
Secretary of State in accordance with Section 1.6 of the Agreement, the Merger
will become effective at the time of such filing, and upon effectiveness of the
Merger each share of Raritan Common Stock will be converted as provided in
Article II of the Agreement.
(h) No approvals, authorizations, consents or other actions or
filings under federal banking law or New Jersey law ("Approvals") are required
to be obtained by United or UNB in order to permit the execution and delivery of
the Agreement by United and UNB and the performance by United and UNB of the
transactions contemplated thereby other than those Approvals which have been
obtained or those Approvals or consents required to be obtained by Raritan or
the Bank, and Approvals not required or necessary to be obtained on the date
hereof.
(i) Except as set forth in the United Disclosure Schedule and
in United's certificate addressed to us and attached hereto, and other than
ordinary routine litigation incidental to the business of United or its
Subsidiaries, we are not aware of any material action, suit or proceeding or
investigation pending or threatened in writing against or affecting the
business, operations, property or financial condition of United or any of its
Subsidiaries, at law or in equity, in any court or before any Federal, state,
municipal or other governmental department, commission, board, bureau, agency or
instrumentality, except those which, if decided adversely to United or any of
its Subsidiaries, would not have a material adverse effect on United and its
Subsidiaries, taken as a whole; provided, however, we are not counsel to United
or its Subsidiaries in certain litigation and with respect to any such
litigation we are relying upon the representation and warranty of United made in
Section 4.10 of the Agreement with respect to material litigation and on
United's certificate addressed to us and attached hereto.
(j) The Registration Statement has been declared effective by
the SEC under the 1933 Act and we are not aware that any stop order suspending
the effectiveness has been issued under the 1933 Act or proceedings therefor
initiated or threatened by the SEC.
*******
We are not passing upon and do not assume any responsibility
for the accuracy, completeness or fairness of the statements and information
contained in the Joint Proxy Statement/Prospectus and make no representation
that we have independently verified the accuracy, completeness or fairness of
such statements and information, but, without in any way limiting the generality
of the foregoing, based upon our review of the Joint Proxy Statement/Prospectus
(i) the Joint Proxy Statement/Prospectus (except for financial statements and
other tabular financial information, and other financial and statistical data
and information, as to which we express no opinion) complies as to form in all
material respects with the 1933 Act and the applicable laws and regulations
thereunder, (ii) no facts have come to our attention that caused us to believe
that (except for financial statements and other tabular financial information,
as to which we do not express any belief) the Joint Proxy Statement/Prospectus
on the date of the mailing thereof and on the date of the meeting of
stockholders of Raritan at which the Agreement was approved, contained any
untrue statement of a material fact with respect to United or omitted to state a
material fact with respect to United necessary in order to make the statements
therein with respect to United, in light of the circumstances under which they
were made, not misleading.
*******
In rendering their opinion, counsel to United (A) may, to the
extent they deem proper and so specify in their opinion, rely upon the opinion
of other counsel as to matters involving the application of laws of any
jurisdiction other than the United States or the State of New Jersey, or may
exclude from their opinion the substance included in the opinions of other
counsel given directly to Raritan and (B) may rely, as to matters of fact, on
certificates of responsible officers of United, UNB, or other Subsidiaries of
United and public officials; provided copies of any such opinions or
certificates are delivered to Raritan together with the opinion to be rendered
hereunder by counsel to United. Counsel to United may assume that any agreement
is the valid and binding obligation of any parties to such agreement other than
United. As to matters of fact, counsel to United may also rely upon the
representations and warranties made by United to Raritan in the Agreement as
though such representations and warranties were made directly to counsel.
Counsel to United may also rely upon the genuineness of signatures and the
authenticity of copies.
<PAGE>
Exhibit B to
Merger Agreement
<TABLE>
<CAPTION>
Index
Index
Weighting
Company Name Ticker City State (%)
<S> <C> <C> <C> <C>
Commerce Bancorp, Inc. CBH Cherry Hill NJ 10.95
S&T Bancorp, Inc. STBA Indiana PA 8.50
TrustCo Bank Corp NY TRST Schenectady NY 8.28
Provident Bankshares Corporation PBKS Baltimore MD 7.80
UST Corporation USTB Boston MA 7.75
F&M National Corporation FMN Winchester VA 7.43
First Commonwealth Financial Corporation
FCF Indiana PA 6.97
Trust Company of New Jersey (The) TCNJ Jersey City NJ 5.67
National Penn Bancshares, Inc. NPBC Boyertown PA 4.10
BT Financial Corporation BTFC Johnstown PA 3.82
USBANCORP, Inc. UBAN Johnstown PA 3.55
Sandy Spring Bancorp SASR Olney MD 3.54
NBT Bancorp, Inc. NBTB Norwich NY 3.28
First Western Bancorp, Inc. FWBI New Castle PA 3.25
Harleysville National Corporation HNBC Harleysville PA 3.16
BSB Bancorp, Inc. BSBN Binghamton NY 3.07
F&M Bancorp FMBN Frederick MD 2.68
Community Bank System, Inc. CBU DeWitt NY 2.51
Arrow Financial Corporation AROW Glen Falls NY 2.04
Sun Bancorp, Inc. SNBC Vineland NJ 1.66
</TABLE>
If, at any time after September 21, 1998 and before the Determination Date, the
common stock of any company on this Exhibit B ceases to be publicly traded or
any public announcement of a proposal for such company to be acquired or for
such company to acquire another company or companies in transactions with a
value exceeding 25% of the acquiror's market capitalization, such company shall
be removed from the Index Group effective as of the Starting Date (i.e., such
Company shall not be considered part of the Index Group for any purposes in
connection with this Merger Agreement) and the Index Weighting of the remaining
companies in the Index Group shall be increased proportionately to their prior
Index Weighting, so that the total Index Weighting is 100%. If any company
belonging to the Index Group declares or effects a stock dividend,
reclassification, recapitalization, split-up, combination, exchange of shares,
or similar transaction between the Starting Date and the Determination Date, the
prices for the common stock of such company shall be appropriately adjusted for
the purposes of applying this Exhibit B.
