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): November 13, 1996
OSB FINANCIAL CORP.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Wisconsin 0-20335 39-1726499
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(State or other (Commission File (IRS Employer
jurisdiction Number) Identification No.)
of incorporation)
420 South Koeller Street, Oshkosh, Wisconsin 54902
------------------------------------------------------------
(Address of principal executive offices, including zip code)
(414) 236-3680
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(Registrant's telephone number)
<PAGE> 2
ITEM 5. OTHER EVENTS
------------
OSB Financial Corp., a Wisconsin corporation ("OSB")
and parent company of Oshkosh Savings Bank, F.S.B. and FCB
Financial Corp., a Wisconsin corporation ("FCB) and parent
company of Fox Cities Bank, F.S.B., have entered into an
Agreement and Plan of Merger, dated as of November 13, 1996 (the
"Merger Agreement"), providing for the merger of OSB with and
into FCB (the "Merger"), pursuant to a merger of equals
transaction. FCB will be the surviving corporation in the Merger
(the "Surviving Corporation") and will continue to operate under
the name FCB Financial Corp. The Merger Agreement has been
approved by the Boards of Directors of both of the constituent
companies and, subject to shareholder approval of both FCB and
OSB shareholders as well as various regulatory approvals, the
Merger is expected to be completed during the second quarter of
1997. The banking subsidiaries of the two merger partners are
also expected to merge and will thereafter operate under the name
Fox Cities Bank, F.S.B. (the "Surviving Bank").
Under the terms of the Merger Agreement, each share of
common stock, $.01 par value, of OSB (the "OSB Common Stock")
issued and outstanding immediately prior to the effectiveness of
the Merger (the "Effective Time") will (except as otherwise
provided below) be cancelled and converted into the right to
receive 1.46 shares (the "OSB Exchange Ratio") of the common
stock, $.01 par value, of FCB (the "FCB Common Stock") plus cash
in lieu of any fractional shares. All shares of OSB Common Stock
(i) owned by OSB as treasury stock, (ii) owned by the OSB
Management Development and Recognition Plans and not allocated to
participants thereunder or (iii) owned by FCB will be cancelled
and no FCB Common Stock or other consideration will be given in
exchange therefor. Shares of FCB Common Stock which are issued
and outstanding at the time of the Merger will not be affected by
the Merger and will remain outstanding as the same number of
shares of the Surviving Corporation. Each option granted by OSB
under the terms of the OSB Financial Corp. 1992 Stock Option and
Incentive Plan (the "OSB Option Plan") which is outstanding and
unexercised prior to the Effective Time will be converted into an
option to purchase shares of FCB Common Stock equal to the
product of the number of shares of OSB Common Stock subject to
the original option and the OSB Exchange Ratio (with fractional
shares being rounded up to the nearest whole number) and will
have an exercise price per share equal to the exercise price
under the original option divided by the OSB Exchange Ratio (with
the exercise price rounded down to the nearest whole cent).
At the Effective Time, it is expected that the
quarterly cash dividend of the Surviving Corporation will remain
at the current FCB level of $.18 per share. Subsequent dividend
policy will be developed by the Board of Directors of the
Surviving Corporation.
<PAGE> 3
The Merger is subject to customary closing conditions,
including, without limitation, the receipt of required
shareholder approvals of FCB and OSB; the receipt of regulatory
approvals, including approval of the Office of Thrift
Supervision, to consummate the Merger; and the receipt of
opinions of counsel that the Merger will qualify as a tax-free
reorganization. In addition, the Merger is conditioned upon the
effectiveness of a registration statement to be filed by FCB with
the Securities and Exchange Commission with respect to shares of
FCB Common Stock to be issued in the Merger. It is anticipated
that shareholders will vote upon the Merger at special meetings
of shareholders held by both FCB and OSB in the second quarter of
1997.
The Merger Agreement contains certain covenants of the
parties pending the consummation of the Merger. Generally, the
parties must carry on their businesses in the ordinary course
consistent with past practice, may not declare dividends on
common stock other than regular quarterly cash dividends and may
not issue any capital stock except pursuant to outstanding stock
options. The Merger Agreement also contains restrictions on,
among other things, charter and bylaw amendments, acquisitions,
dispositions of assets, incurrence of indebtedness, certain
increases in employee compensation and benefits, the satisfaction
of material claims, liabilities or obligations, and material
changes to the investment securities portfolio or gap position of
FCB or OSB. (See Article V of the Merger Agreement.)
The Merger Agreement provides that, after the Effective
Time, the corporate headquarters of the Surviving Corporation
will be located in Oshkosh, Wisconsin. The Surviving
Corporation's Board of Directors, which will be divided into
three classes, will consist of a total of 14 directors, 7 of whom
will be selected by FCB and 7 of whom will be selected by OSB.
Mr. Donald D. Parker, the current Chairman of the Board,
President and Chief Executive Officer of FCB, will serve as
Chairman of the Board of Directors of the Surviving Corporation
and the Surviving Bank. Mr. James J. Rothenbach, the current
President and Chief Executive Officer of OSB, will serve as
President and Chief Executive Officer of the Surviving
Corporation and the Surviving Bank. Mr. Phillip J. Schoofs, the
current Vice President and Treasurer of FCB, will serve as the
Vice President, Treasurer and Chief Financial Officer of the
Surviving Corporation and the Surviving Bank. (See Article I of
the Merger Agreement.)
The Merger Agreement may be terminated under certain
circumstances, including (i) by mutual consent of the parties;
(ii) by either party within 20 days of the date of the Merger
Agreement (30 days in the case of environmental issues) if such
party determines, upon completion of its due diligence, that the
Merger would not be in the best interests of such party or its
shareholders; (iii) by either party if the Merger is not
<PAGE> 4
consummated by September 30, 1997; (iv) by either party if either
of FCB's or OSB's shareholders vote against the Merger or if any
state or federal law or court order prohibits the Merger; (v) by
the non-breaching party if there exist breaches of any
representations or warranties contained in the Merger Agreement
or in the Stock Option Agreements (as hereinafter defined), which
breaches, individually or in the aggregate, would result in a
material adverse effect on the breaching party and which are not
cured within thirty (30) days after notice; (vi) by the non-
breaching party if there occurs a material breach of any covenant
or agreement in the Merger Agreement or in the Stock Option
Agreements which is not cured within thirty (30) days after
notice; (vii) by either party if the Board of Directors of the
other party shall withdraw or adversely modify its recommendation
of the Merger or shall approve or recommend any competing
transaction; or (viii) by either party, under certain
circumstances, as a result of a third party tender offer or
business combination proposal which such party, pursuant to its
directors' fiduciary duties, is, in the opinion of such party's
counsel and after the other party has first been given an
opportunity to make concessions and adjustments in the terms of
the Merger Agreement, required to accept. (See Article VIII of
the Merger Agreement.)
The Merger Agreement provides that if a breach
described in clause (v) or (vi) of the previous paragraph occurs,
then, if such breach is not willful, the non-breaching party will
be entitled to reimbursement of its out-of-pocket expenses, not
to exceed $200,000. In the event of a willful breach, the non-
breaching party will be entitled to its out-of-pocket expenses
(which shall not be limited to $200,000) and any remedies it may
have at law or in equity, and provided that if, at the time of
the breaching party's willful breach, there shall have been a
third party tender offer or business combination proposal which
shall not have been rejected by the breaching party or withdrawn
by the third party, then such breaching party at the time of
termination of the Merger Agreement, will pay to the non-
breaching party an additional aggregate fee equal to $1.0
million. The Merger Agreement also requires payment of an
aggregate termination fee of $1.0 million, together with
reimbursement of out-of-pocket expenses, by one party (the
"Target Party") to the other party, if the Merger Agreement is
terminated (a) as a result of the acceptance by the Target Party
of a third party tender offer or business combination proposal,
(b) as a result of the Target Party's material failure to convene
a meeting of shareholders while a third party tender offer or
business combination proposal remains outstanding, (c) following
a failure of the shareholders of the Target Party to approve the
Merger while a third party tender offer or business combination
proposal remains outstanding or, (d) the Board of Directors of
either party to the Merger withdraws or modifies its
recommendation of the Merger Agreement, approves or recommends
any business combination with a third party, or resolves to take
<PAGE> 5
any of the foregoing actions. The termination fees (exclusive of
any amounts paid for the reimbursement of expenses) payable by
FCB or OSB under the foregoing provisions plus the aggregate
amount which could be payable by FCB or OSB under the Stock
Option Agreements may not exceed $1.5 million in the aggregate.
Concurrently with the Merger Agreement, FCB and OSB
have also entered into reciprocal stock option and trigger
payment agreements (the "Stock Option Agreements") granting each
other irrevocable options to purchase up to 19.9% of the other
party's shares of common stock issued and outstanding as of
November 13, 1996 at an exercise price of $24.375 per share of
OSB Common Stock and $18.875 per share of FCB Common Stock. Each
option is exercisable only if the Merger Agreement should become
terminable in a case where a termination fee would be payable to
the holder of the option. A party whose option becomes
exercisable (the "Exercising Party") will have the right to
receive, under certain circumstances, the difference between the
exercise price and the then current market price of the shares
subject to option and may request that the other party repurchase
from it all or any portion of the Exercising Party's option at
the price specified in the Stock Option Agreements. (See the
Stock Option Agreements.)
The Merger, which will be accounted for as a purchase
transaction for accounting purposes, will create the largest
independent thrift institution headquartered in the Fox River
Valley area of Wisconsin. It is expected that the Surviving
Corporation will continue to provide full service banking from
each of the existing 13 Fox Cities Bank, F.S.B. and Oshkosh
Savings Bank, F.S.B. offices located in various cities throughout
the region. Based on data as of September 30, 1996, the
Surviving Corporation will have total assets in excess of $500
million, total loans of approximately $390 million, total
deposits of approximately $310 million and shareholders' equity
of approximately $75 million. The Surviving Corporation also
will have in excess of $220 million of mortgage loans that it
originated and services for others. It is currently estimated
that the combination of various functions and other economies of
scale when implemented will result in annual pre-tax savings for
the Surviving Corporation on a net basis of approximately
$800,000.
The Merger Agreement, the joint press release issued in
conjunction therewith and the Stock Option Agreements are filed
as exhibits to this Current Report on Form 8-K and are
incorporated herein by reference. The brief summaries of the
material provisions of the Merger Agreement and the Stock Option
Agreements set forth above are qualified in their entirety by
reference to each respective agreement filed as an exhibit
hereto.
<PAGE> 6
This Current Report on Form 8-K includes forward-
looking statements. These forward-looking statements can be
identified as such because the context of the statement includes
phrases such as "it is expected" or "it is currently estimated"
or other words of similar import. Similarly, statements that
describe future plans or strategies are also forward-looking
statements. Such statements are subject to certain risks and
uncertainties which could cause actual results to differ
materially from those currently anticipated. Factors which could
affect actual results include interest rate trends, the general
economic climate in the FCB and OSB market areas, loan
delinquency rates, regulatory treatment and the ability of the
Surviving Corporation to implement successfully plans to
eliminate redundancies. These factors should be considered in
evaluating the forward-looking statements, and undue reliance
should not be placed on such statements. The forward-looking
statements included herein are made as of the date hereof and OSB
undertakes no obligation to update publicly such statements to
reflect subsequent events or circumstances.
ITEM 6. FINANCIAL STATEMENTS AND EXHIBITS.
---------------------------------
(a) Not Applicable.
(b) Not Applicable
(c) Exhibits.
--------
The exhibits listed in the accompanying Exhibit
Index are filed as part of this Current Report on
Form 8-K.
SIGNATURES
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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.
OSB FINANCIAL CORP.
Date: November 22, 1996 By: /s/ James J. Rothenbach
--------------------------
James J. Rothenbach
President and Chief Executive
Officer
<PAGE> 7
OSB FINANCIAL CORP.
EXHIBIT INDEX TO FORM 8-K
Report Dated November 13, 1996
(2.1) Agreement and Plan of Merger, dated as
of November 13, 1996, by and between FCB
Financial Corp. and OSB Financial Corp.*
(2.2) Stock Option and Trigger Payment
Agreement, dated as of November 13,
1996, by and between FCB Financial Corp.
and OSB Financial Corp.
(2.3) Stock Option and Trigger Payment
Agreement, dated as of November 13,
1996, by and between OSB Financial Corp.
and FCB Financial Corp.
(99) Joint Press Release of FCB Financial
Corp. and OSB Financial Corp., dated
November 14, 1996.
______________________
* The schedules to this document are not being filed
herewith. The Registrant agrees to furnish
supplementally a copy of any omitted schedule to the
Securities and Exchange Commission upon request.
EXHIBIT 2.1
AGREEMENT AND PLAN OF MERGER
BETWEEN
FCB FINANCIAL CORP.
AND
OSB FINANCIAL CORP.
November 13, 1996
<PAGE> 9
TABLE OF CONTENTS
Page
----
ARTICLE I -- THE MERGER . . . . . . . . . . . . . . . . . . . 14
1.1 THE MERGER . . . . . . . . . . . . . . . . . . . . 14
1.2 EFFECTIVE TIME . . . . . . . . . . . . . . . . . . 15
1.3 EFFECTS OF THE MERGER . . . . . . . . . . . . . . . 15
1.4 CONVERSION OF OSB COMMON STOCK; TREATMENT OF FCB
COMMON STOCK . . . . . . . . . . . . . . . . . . . 15
1.5 STOCK OPTIONS . . . . . . . . . . . . . . . . . . . 16
1.6 ARTICLES OF INCORPORATION . . . . . . . . . . . . . 17
1.7 BY-LAWS . . . . . . . . . . . . . . . . . . . . . . 17
1.8 TAX CONSEQUENCES . . . . . . . . . . . . . . . . . 17
1.9 PLANS FOR MANAGEMENT SUCCESSION . . . . . . . . . . 17
1.10 BOARD OF DIRECTORS OF THE SURVIVING CORPORATION . . 18
1.11 HEADQUARTERS OF THE SURVIVING CORPORATION . . . . . 19
1.12 CLOSING . . . . . . . . . . . . . . . . . . . . . . 19
ARTICLE II -- CONVERSION OF SHARES . . . . . . . . . . . . . 19
2.1 FCB TO MAKE SHARES AVAILABLE . . . . . . . . . . . 19
2.2 EXCHANGE OF CERTIFICATES . . . . . . . . . . . . . 20
ARTICLE III -- REPRESENTATIONS AND WARRANTIES OF OSB . . . . 22
3.1 CORPORATE ORGANIZATION . . . . . . . . . . . . . . 22
3.2 CAPITALIZATION . . . . . . . . . . . . . . . . . . 23
3.3 AUTHORITY; NO VIOLATION . . . . . . . . . . . . . . 24
3.4 CONSENTS AND APPROVALS . . . . . . . . . . . . . . 25
3.5 REPORTS . . . . . . . . . . . . . . . . . . . . . . 25
3.6 FINANCIAL STATEMENTS . . . . . . . . . . . . . . . 26
3.7 BROKER'S FEES . . . . . . . . . . . . . . . . . . . 26
3.8 ABSENCE OF CERTAIN CHANGES OR EVENTS . . . . . . . 27
3.9 LEGAL PROCEEDINGS . . . . . . . . . . . . . . . . . 27
3.10 TAXES AND TAX RETURNS . . . . . . . . . . . . . . . 27
3.11 EMPLOYEES . . . . . . . . . . . . . . . . . . . . . 29
3.12 SEC REPORTS . . . . . . . . . . . . . . . . . . . . 30
3.13 COMPLIANCE WITH APPLICABLE LAW . . . . . . . . . . 30
3.14 CERTAIN CONTRACTS . . . . . . . . . . . . . . . . . 31
3.15 AGREEMENTS WITH REGULATORY AGENCIES . . . . . . . . 32
3.16 OTHER ACTIVITIES OF OSB AND ITS OSB SUBSIDIARIES . 32
3.17 INVESTMENT SECURITIES . . . . . . . . . . . . . . . 32
3.18 UNDISCLOSED LIABILITIES . . . . . . . . . . . . . . 33
3.19 INSURANCE . . . . . . . . . . . . . . . . . . . . . 33
3.20 LOAN LOSS RESERVES . . . . . . . . . . . . . . . . 33
3.21 ENVIRONMENTAL LIABILITY . . . . . . . . . . . . . . 33
3.22 APPROVAL DELAYS . . . . . . . . . . . . . . . . . . 34
3.23 VOTE REQUIRED . . . . . . . . . . . . . . . . . . . 34
3.24 APPLICABILITY OF CERTAIN PROVISIONS OF WISCONSIN
LAW, ETC . . . . . . . . . . . . . . . . . . . . . 34
3.25 OWNERSHIP OF FCB COMMON STOCK . . . . . . . . . . . 34
<PAGE> 10
ARTICLE IV -- REPRESENTATIONS AND WARRANTIES OF FCB . . . . . 35
4.1 CORPORATE ORGANIZATION . . . . . . . . . . . . . . 35
4.2 CAPITALIZATION . . . . . . . . . . . . . . . . . . 36
4.3 AUTHORITY; NO VIOLATION . . . . . . . . . . . . . . 37
4.4 CONSENTS AND APPROVALS . . . . . . . . . . . . . . 37
4.5 REPORTS . . . . . . . . . . . . . . . . . . . . . . 38
4.6 FINANCIAL STATEMENTS . . . . . . . . . . . . . . . 38
4.7 BROKER'S FEES . . . . . . . . . . . . . . . . . . . 39
4.8 ABSENCE OF CERTAIN CHANGES OR EVENTS . . . . . . . 39
4.9 LEGAL PROCEEDINGS . . . . . . . . . . . . . . . . . 39
4.10 TAXES AND TAX RETURNS . . . . . . . . . . . . . . . 40
4.11 EMPLOYEES . . . . . . . . . . . . . . . . . . . . . 41
4.12 SEC REPORTS . . . . . . . . . . . . . . . . . . . . 42
4.13 COMPLIANCE WITH APPLICABLE LAW . . . . . . . . . . 42
4.14 CERTAIN CONTRACTS . . . . . . . . . . . . . . . . . 43
4.15 AGREEMENTS WITH REGULATORY AGENCIES . . . . . . . . 44
4.16 OTHER ACTIVITIES OF FCB AND ITS FCB SUBSIDIARIES . 44
4.17 INVESTMENT SECURITIES . . . . . . . . . . . . . . . 44
4.18 UNDISCLOSED LIABILITIES . . . . . . . . . . . . . . 45
4.19 INSURANCE . . . . . . . . . . . . . . . . . . . . . 45
4.20 LOAN LOSS RESERVES . . . . . . . . . . . . . . . . 45
4.21 ENVIRONMENTAL LIABILITY . . . . . . . . . . . . . . 45
4.22 APPROVAL DELAYS . . . . . . . . . . . . . . . . . . 46
4.23 VOTE REQUIRED . . . . . . . . . . . . . . . . . . . 46
4.24 APPLICABILITY OF CERTAIN PROVISIONS OF WISCONSIN
LAW, ETC . . . . . . . . . . . . . . . . . . . . . 46
4.25 OWNERSHIP OF OSB COMMON STOCK . . . . . . . . . . . 46
ARTICLE V -- COVENANTS RELATING TO CONDUCT OF BUSINESS . . . 46
5.1 CONDUCT OF BUSINESSES PRIOR TO THE EFFECTIVE TIME . 46
5.2 FORBEARANCES . . . . . . . . . . . . . . . . . . . 47
ARTICLE VI -- ADDITIONAL AGREEMENTS . . . . . . . . . . . . . 50
6.1 REGULATORY MATTERS; COOPERATION WITH RESPECT TO
FILING . . . . . . . . . . . . . . . . . . . . . . 50
6.2 ACCESS TO INFORMATION; DUE DILIGENCE . . . . . . . 52
6.3 SHAREHOLDERS' APPROVALS . . . . . . . . . . . . . . 53
6.4 LEGAL CONDITIONS TO MERGER . . . . . . . . . . . . 54
6.5 LISTING OF SHARES . . . . . . . . . . . . . . . . . 54
6.6 INDEMNIFICATION; DIRECTORS' AND OFFICERS'
INSURANCE . . . . . . . . . . . . . . . . . . . . . 54
6.7 ADDITIONAL AGREEMENTS . . . . . . . . . . . . . . . 56
6.8 ADVICE OF CHANGES . . . . . . . . . . . . . . . . . 57
6.9 NO CONDUCT INCONSISTENT WITH THIS AGREEMENT . . . . 57
6.10 EMPLOYEE BENEFIT PLANS . . . . . . . . . . . . . . 58
6.11 SEVERANCE FOR CERTAIN EMPLOYEES . . . . . . . . . . 60
6.12 DIVIDENDS . . . . . . . . . . . . . . . . . . . . . 60
6.13 POST-CLOSING STOCK OPTIONS . . . . . . . . . . . . 60
6.14 SUBSIDIARY BANK MERGER . . . . . . . . . . . . . . 61
6.15 RULE 145 AFFILIATES . . . . . . . . . . . . . . . . 61
6.16 DISCLOSURE SCHEDULES . . . . . . . . . . . . . . . 61
6.17 FILING AND OTHER FEES . . . . . . . . . . . . . . . 62
<PAGE> 11
ARTICLE VII -- CONDITIONS PRECEDENT . . . . . . . . . . . . . 62
7.1 CONDITIONS TO EACH PARTY'S OBLIGATION TO EFFECT
THE MERGER . . . . . . . . . . . . . . . . . . . . 62
(a) SHAREHOLDER APPROVAL . . . . . . . . . . . . . 62
(b) OTHER APPROVALS . . . . . . . . . . . . . . . 62
(c) REGISTRATION STATEMENTS . . . . . . . . . . . 62
(d) NO INJUNCTIONS OR RESTRAINTS; ILLEGALITY . . . 62
(e) FEDERAL TAX OPINION . . . . . . . . . . . . . 63
(f) POST-CLOSING EMPLOYMENT AGREEMENTS . . . . . . 63
7.2 CONDITIONS TO OBLIGATIONS OF OSB . . . . . . . . . 63
(a) REPRESENTATIONS AND WARRANTIES . . . . . . . . 63
(b) PERFORMANCE OF OBLIGATIONS OF FCB . . . . . . 63
(c) NO MATERIAL ADVERSE CHANGE . . . . . . . . . . 64
(d) OPINION OF COUNSEL TO FCB . . . . . . . . . . 64
(e) COMFORT LETTERS . . . . . . . . . . . . . . . 64
(f) FAIRNESS OPINION . . . . . . . . . . . . . . . 64
7.3 CONDITIONS TO OBLIGATIONS OF FCB . . . . . . . . . 64
(a) REPRESENTATIONS AND WARRANTIES . . . . . . . . 64
(b) PERFORMANCE OF OBLIGATIONS OF OSB . . . . . . 65
(c) NO MATERIAL ADVERSE CHANGE . . . . . . . . . . 65
(d) OPINION OF COUNSEL TO OSB . . . . . . . . . . 65
(e) COMFORT LETTERS . . . . . . . . . . . . . . . 65
(f) FAIRNESS OPINION . . . . . . . . . . . . . . . 65
(g) AFFILIATE AGREEMENTS . . . . . . . . . . . . . 65
ARTICLE VIII -- TERMINATION, EXPENSES AND AMENDMENT . . . . . 65
8.1 TERMINATION . . . . . . . . . . . . . . . . . . . . 65
8.2 EFFECT OF TERMINATION . . . . . . . . . . . . . . . 70
8.3 TERMINATION FEE; EXPENSES . . . . . . . . . . . . . 70
8.4 AMENDMENT . . . . . . . . . . . . . . . . . . . . . 72
8.5 EXTENSION; WAIVER . . . . . . . . . . . . . . . . . 72
ARTICLE IX -- GENERAL PROVISIONS . . . . . . . . . . . . . . 73
9.1 NON-SURVIVAL OF REPRESENTATIONS, WARRANTIES AND
AGREEMENTS . . . . . . . . . . . . . . . . . . . . 73
9.2 NOTICES . . . . . . . . . . . . . . . . . . . . . . 73
9.3 INTERPRETATION . . . . . . . . . . . . . . . . . . 74
9.4 COUNTERPARTS . . . . . . . . . . . . . . . . . . . 74
9.5 ENTIRE AGREEMENT . . . . . . . . . . . . . . . . . 75
9.6 GOVERNING LAW . . . . . . . . . . . . . . . . . . . 75
9.7 SEVERABILITY . . . . . . . . . . . . . . . . . . . 75
9.8 PUBLICITY . . . . . . . . . . . . . . . . . . . . . 75
9.9 ASSIGNMENT; THIRD PARTY BENEFICIARIES . . . . . . . 75
9.10 ENFORCEMENT . . . . . . . . . . . . . . . . . . . . 76
<PAGE> 12
ARTICLE X -- THE MERGER . . . . . . . . . . . . . . . . . . . 111
10.1 THE MERGER . . . . . . . . . . . . . . . . . . . . 111
10.2 EFFECTIVE TIME . . . . . . . . . . . . . . . . . . 111
10.3 EFFECTS OF THE MERGER . . . . . . . . . . . . . . . 112
10.4 CONVERSION OF OSB COMMON STOCK; TREATMENT OF FCB
COMMON STOCK . . . . . . . . . . . . . . . . . . . 112
10.5 ARTICLES OF INCORPORATION . . . . . . . . . . . . . 113
10.6 BY-LAWS . . . . . . . . . . . . . . . . . . . . . . 113
10.7 TAX CONSEQUENCES . . . . . . . . . . . . . . . . . 113
10.8 BOARD OF DIRECTORS OF THE SURVIVING CORPORATION . . 113
10.9 CLOSING . . . . . . . . . . . . . . . . . . . . . . 113
ARTICLE XI -- CONVERSION OF SHARES . . . . . . . . . . . . . 114
11.1 FCB TO MAKE SHARES AVAILABLE . . . . . . . . . . . 114
11.2 EXCHANGE OF CERTIFICATES . . . . . . . . . . . . . 114
ARTICLE XII -- SHAREHOLDER APPROVALS . . . . . . . . . . . . 116
12.1 . . . . . . . . . . . . . . . . . . . . . . . . . 116
ARTICLE XIII -- GENERAL PROVISIONS . . . . . . . . . . . . . 116
13.1 TERMINATION. . . . . . . . . . . . . . . . . . . . 116
13.2 COUNTERPARTS . . . . . . . . . . . . . . . . . . . 116
13.3 GOVERNING LAW . . . . . . . . . . . . . . . . . . . 117
13.4 AMENDMENT . . . . . . . . . . . . . . . . . . . . . 117
Exhibit A - Form of FCB Stock Option and Trigger Payment
Agreement
Exhibit B - Form of OSB Stock Option and Trigger Payment
Agreement
Exhibit C - Plan of Merger
Exhibit D - Directors of the Surviving Corporation
Exhibit E - List of Directors and Executive Officers of
Surviving Bank
Exhibit F - Form of Affiliate Agreement
Exhibit G - Employment Agreement with Donald D. Parker
Exhibit H - Employment Agreement with Phillip J. Schoofs
Exhibit I - Employment Agreement with Harold L.
Hermansen
Exhibit J - Employment Agreement with James J.
Rothenbach
Exhibit K - Employment Agreement with Theodore W. Hoff
Exhibit L - Form of Opinion of Foley & Lardner
Exhibit M - Form of Opinion of Schiff Hardin & Waite
<PAGE> 13
Schedule 3.1(b) - OSB Ownership of Outside Entities
Schedule 3.1(c) - OSB Subsidiaries Ownership of Outside
Entities
Schedule 3.2(a) - OSB Obligations to Purchase or Issue
Shares of OSB Common Stock or Other
Equity Securities
Schedule 3.8(a) - Absence of Certain Changes or Events
Schedule 3.9 - OSB Legal Proceedings
Schedule 3.10(a) - Income Adjustments Pursuant to
Section 481 of the Code
Schedule 3.11(a) - OSB Benefit Plans and Agreements
Schedule 3.14(a) - OSB Contract Exceptions
Schedule 3.18 - Undisclosed Liabilities
Schedule 3.19 - OSB Insurance Policies
Schedule 3.21 - Environmental Contingencies
Schedule 3.25 - OSB Ownership of FCB Common Stock
Schedule 4.1(b) - FCB Ownership of Outside Entities
Schedule 4.1(c) - FCB Subsidiaries Ownership of Outside
Entities
Schedule 4.2(a) - FCB Obligations to Purchase or Issue
Shares of FCB Common Stock or Other
Equity Securities
Schedule 4.8(a) - Absence of Certain Changes or Events
Schedule 4.9 - FCB Legal Proceedings
Schedule 4.10(a) - Income Adjustments Pursuant to
Section 481 of the Code
Schedule 4.11 - FCB Benefit Plans
Schedule 4.14(a) - FCB Contract Exceptions
Schedule 4.18 - Undisclosed Liabilities
Schedule 4.19 - FCB Insurance Policies
Schedule 4.21 - Environmental Contingencies
Schedule 4.25 - FCB Ownership of OSB Common Stock
Schedule 6.11 - Officers for Purposes of Severance
Payments
<PAGE> 14
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER (this "Agreement"), dated
as of November 13, 1996, by and between FCB Financial Corp., a
Wisconsin corporation ("FCB"), and OSB Financial Corp., a
Wisconsin corporation ("OSB").
WHEREAS, the Boards of Directors of FCB and OSB have
determined that it is in the best interests of their respective
corporations and their shareholders to consummate a merger in
which OSB will merge with and into FCB (the "Merger"), so that
FCB is the resulting corporation (hereinafter sometimes called
the "Surviving Corporation") in the Merger;
WHEREAS, concurrently with or as soon as is practicable
after the Merger, the Surviving Corporation shall cause OSB's
wholly-owned depository institution subsidiary, Oshkosh Savings
Bank, FSB ("OSB Bank"), to be merged with and into FCB's wholly-
owned depository institution subsidiary, Fox Cities Bank, F.S.B.
("FCB Bank") (the "Bank Merger"), so that FCB Bank is the
resulting wholly-owned depository institution subsidiary of the
Surviving Corporation (hereinafter sometimes called the
"Surviving Bank") in the Bank Merger;
WHEREAS, as a condition to, and immediately after the
execution of this Agreement, FCB and OSB are entering into a FCB
Stock Option and Trigger Payment Agreement (the "FCB Stock Option
Agreement"), attached hereto as Exhibit A;
WHEREAS, as a condition to, and immediately after the
execution of this Agreement, FCB and OSB are entering into an OSB
Stock Option and Trigger Payment Agreement (the "OSB Stock Option
Agreement"), attached hereto as Exhibit B (and together with the
FCB Stock Option and Trigger Payment Agreement, the "Option
Agreements"); and
WHEREAS, the parties desire to make certain
representations, warranties and agreements in connection with,
and to prescribe certain conditions, to the Merger.
NOW, THEREFORE, in consideration of the mutual
covenants, representations, warranties and agreements contained
herein, and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties
agree as follows:
ARTICLE I
THE MERGER
1.1 THE MERGER. Subject to the terms and conditions
of this Agreement and the Plan of Merger, a copy of which is
attached hereto as Exhibit C (the "Plan of Merger"), in
<PAGE> 15
accordance with the Wisconsin Business Corporation Law (the
"WBCL"), at the Effective Time (as defined in Section 1.2), OSB
shall merge with and into FCB, and FCB shall survive the Merger
and shall continue its corporate existence under the laws of the
State of Wisconsin. Upon consummation of the Merger, the
separate corporate existence of OSB shall terminate and the name
of the Surviving Corporation shall be "FCB Financial Corp."
The parties agree that OSB and FCB will execute a Plan
of Merger substantially in the form attached hereto as Exhibit C
which provides for the terms of the Merger and the mode of
carrying same into effect.
1.2 EFFECTIVE TIME. The Merger shall become effective
upon the later of (a) the time of filing of Articles of Merger
with the Department of Financial Institutions of the State of
Wisconsin (the "Wisconsin Department") and (b) the effective date
and time of the Merger as set forth in such Articles of Merger.
The parties shall each use reasonable efforts to cause Articles
of Merger to be filed on the Closing Date (as defined in Section
1.12). The term "Effective Time" shall be the date and time when
the Merger becomes effective, in accordance with this Section
1.2.
1.3 EFFECTS OF THE MERGER. At and after the Effective
Time, the Merger shall have the effects set forth in Section
180.1106 of the WBCL.
1.4 CONVERSION OF OSB COMMON STOCK; TREATMENT OF FCB
COMMON STOCK.
(a) At the Effective Time, subject to Section
2.2, by virtue of the Merger and without any action on the
part of OSB, or the holder of any securities of OSB, each
share of the common stock, $.01 par value, of OSB (the "OSB
Common Stock") issued and outstanding immediately prior to
the Effective Time (other than shares canceled pursuant to
Section 1.4(c)) shall be converted into the right to receive
1.46 shares (the "OSB Exchange Ratio") of the common stock,
par value $.01 per share, of FCB (the "FCB Common Stock").
(b) All of the shares of OSB Common Stock
converted into FCB Common Stock pursuant to this Article I
shall no longer be outstanding and shall automatically be
canceled and shall cease to exist as of the Effective Time,
and each certificate (each an "OSB Common Stock
Certificate") previously representing any such shares of OSB
Common Stock shall thereafter represent only the right to
receive (i) a certificate representing the number of whole
shares of FCB Common Stock (each a "FCB Common Stock
Certificate") and (ii) cash in lieu of fractional shares
into which the shares of OSB Common Stock previously
represented by such OSB Common Stock Certificate have been
<PAGE> 16
converted pursuant to this Section 1.4, Section 2.2 and the
Plan of Merger. OSB Common Stock Certificates previously
representing shares of OSB Common Stock shall be exchanged
for FCB Common Stock Certificates representing whole shares
of FCB Common Stock and cash in lieu of fractional shares
issued in consideration therefor upon the surrender of such
OSB Common Stock Certificates in accordance with Section
2.2, without any interest thereon.
(c) At the Effective Time, all shares of OSB
Common Stock that are owned by OSB as treasury stock, owned
by the OSB MRP (as defined herein) and not allocated to
participants thereunder or owned by FCB, if any, shall be
canceled and shall cease to exist, and no stock of FCB or
other consideration shall be delivered in exchange therefor.
(d) At and after the Effective Time, each share
of FCB Common Stock issued and outstanding immediately prior
to the Effective Time shall remain an issued and outstanding
share of common stock of the Surviving Corporation and shall
not be affected by the Merger.
1.5 STOCK OPTIONS.
(a) At the Effective Time, each option granted by
OSB under the terms of the OSB Financial Corp. 1992 Stock
Option and Incentive Plan (the "OSB Option Plan") to
purchase shares of OSB Common Stock which is outstanding and
unexercised immediately prior thereto shall cease to
represent a right to acquire shares of OSB Common Stock and
shall be converted automatically into an option to purchase
shares of FCB Common Stock in an amount and at an exercise
price determined pursuant to paragraph (c) of this Section
1.5 (the "Converted Option"), subject to the terms of the
OSB Option Plan and the agreements evidencing grants of such
options thereunder.
(b) From and after the Effective Time, FCB shall
assume any and all obligations of OSB under the OSB Option
Plan, and the OSB Option Plan shall remain in effect.
(c) (i) The number of shares of FCB Common Stock
to be subject to each Converted Option shall be equal to the
product of the number of shares of OSB Common Stock subject
to the original option and the OSB Exchange Ratio, PROVIDED
that any fractional shares of FCB Common Stock resulting
from such multiplication shall be rounded up to the nearest
whole share; and (ii) the exercise price per share of FCB
Common Stock under the Converted Option shall be equal to
the exercise price per share of OSB Common Stock under the
original option divided by the OSB Exchange Ratio, PROVIDED
that such exercise price shall be rounded down to the
nearest whole cent.
<PAGE> 17
(d) The Committee of the OSB Board of Directors
which administers the OSB Option Plan has approved the
foregoing adjustments pursuant to Section 12(c) of the OSB
Option Plan and has not and will not authorize cash payments
to be made for options under the OSB Option Plan pursuant to
Section 12(b) thereof.
(e) Promptly after the execution of this
Agreement, OSB shall take such action, which shall be
reasonably satisfactory to FCB, as OSB may deem necessary in
order that each Converted Option shall be, at the Effective
Time, assumed by FCB and shall from and after the Effective
Time no longer entitle the holder thereof to purchase shares
of OSB Common Stock but shall be converted into and shall
become by virtue of the Merger, automatically and without
any action on the part of the holder thereof, a stock option
to purchase such number of shares of FCB Common Stock at
such exercise price as determined pursuant to paragraph (c)
of this Section 1.5.
1.6 ARTICLES OF INCORPORATION. The Articles of
Incorporation of FCB in effect as of the Effective Time shall be
the Articles of Incorporation of the Surviving Corporation after
the Merger until thereafter amended in accordance with applicable
law.
1.7 BY-LAWS. The By-Laws of FCB in effect as of the
Effective Time, shall be the By-Laws of the Surviving Corporation
after the Merger until thereafter amended in accordance with
applicable law.
1.8 TAX CONSEQUENCES. It is intended that the Merger
shall constitute a reorganization within the meaning of Section
368(a)(1)(A) of the Internal Revenue Code of 1986, as amended
(the "Code"), and that this Agreement and the Plan of Merger
shall constitute a "plan of reorganization" for the purposes of
Section 368 of the Code.
1.9 PLANS FOR MANAGEMENT SUCCESSION. At the Effective
Time, pursuant to the terms hereof and the employment agreements
referred to in Section 7.1(f), (a) Donald D. Parker shall be the
Chairman of the Board of the Surviving Corporation and the
Surviving Bank, (b) James J. Rothenbach shall be the President
and Chief Executive Officer of the Surviving Corporation and the
Surviving Bank, and (c) Phillip J. Schoofs shall be the Vice
President, Treasurer and Chief Financial Officer of the Surviving
Corporation and the Surviving Bank. Nothing in this Section 1.9
shall preclude the Board of Directors of the Surviving
Corporation or the Surviving Bank from subsequently removing any
person appointed as an officer of the Surviving Corporation or
the Surviving Bank pursuant to this Section 1.9.
<PAGE> 18
1.10 BOARD OF DIRECTORS OF THE SURVIVING CORPORATION.
(a) From and after the Effective Time, the Board
of Directors of the Surviving Corporation shall consist of
fourteen (14) persons, including Donald D. Parker and James
J. Rothenbach. Six (6) directors, in addition to Donald D.
Parker, shall have been selected by FCB ("FCB
Representatives"), and six (6) directors, in addition to
James J. Rothenbach, shall have been selected by OSB (the
"OSB Representatives"). The FCB Representatives and the OSB
Representatives, respectively, shall be divided as equally
as practicable among the three classes of directors of the
Surviving Corporation in accordance with Exhibit D, and
shall serve in such capacities until their successors shall
have been elected or appointed and shall have qualified in
accordance with the Articles of Incorporation and By-laws of
the Surviving Corporation and the WBCL. Directors chosen
from among the FCB Representatives and the OSB
Representatives shall be equally represented on the
personnel committee (which shall have four members) and the
executive committee, if any, of the Board of Directors of
the Surviving Corporation.
(b) Prior to the third annual meeting of the
shareholders of the Surviving Corporation following the
Effective Time, the OSB Representatives and the FCB
Representatives, respectively, shall have the right to
designate (i) the person or persons to be nominated in place
of each of the OSB Representatives and FCB Representatives,
respectively, whose terms of office expire at each of the
first three annual meetings of the shareholders of the
Surviving Corporation following the Effective Time, and (ii)
the person or persons to serve on the executive committee,
if any, in place of any OSB Representatives or FCB
Representatives, respectively, previously appointed to the
executive committee. For purposes of this Section 1.10(b),
the terms "OSB Representatives" and "FCB Representatives"
shall include any person or persons subsequently appointed
or elected directors of the Surviving Corporation following
their designation as nominees for director by the OSB
Representatives or FCB Representatives, respectively, in
accordance with the preceding sentence.
(c) It is the intention of OSB and FCB that the
number of directors of the Surviving Corporation shall be
reduced to ten (10) through attrition. To that end and
until the Board of Directors shall consist of ten (10)
directors (composed of five (5) OSB Representatives and five
(5) FCB Representatives) any vacancy occurring on the Board
of Directors of the Surviving Corporation created by the
death, resignation or removal of any director will not be
filled and, instead, within 30 days thereof, an additional
vacancy shall be created by the voluntary resignation of an
<PAGE> 19
FCB Representative or OSB Representative, as the case may
be, in order that the number of OSB Representatives and FCB
Representatives on the Board of Directors of the Surviving
Corporation shall remain equal, and thereafter, the two
vacancies shall be eliminated by resolution of the Board of
Directors of the Surviving Corporation, PROVIDED, HOWEVER,
that if an FCB Representative or OSB Representative, as the
case may be, does not resign within this 30 day period, the
OSB Representatives or the FCB Representatives, as the case
may be, shall have the right to designate the person or
persons to fill such vacancy in order that the number of OSB
Representatives and FCB Representatives shall remain equal.
The parties hereto agree that the terms of this Section
1.10(c) shall bind the Board of Directors of the Surviving
Company for three years after the Closing Date.
1.11 HEADQUARTERS OF THE SURVIVING CORPORATION. At the
Effective Time, the headquarters and principal executive offices
of the Surviving Corporation shall be at 420 South Koeller
Street, Oshkosh, Wisconsin. At the Effective Time, the
commercial loan department of the Surviving Bank shall be located
at 110 Fox River Drive, Appleton, Wisconsin.
1.12 CLOSING. Subject to the terms and conditions of
this Agreement and the Plan of Merger, including but not limited
to the provisions of Article VII of this Agreement, the closing
of the Merger (the "Closing") will take place at 10:00 a.m. on a
date and at a place to be specified by the parties, which shall
be no later than the first business day in the calendar month
immediately following the month in which the last of the
conditions precedent to the Merger set forth in Article VII
hereof is satisfied or waived, or at such other time, date and
place as OSB and FCB shall mutually agree (the "Closing Date").
ARTICLE II
CONVERSION OF SHARES
2.1 FCB TO MAKE SHARES AVAILABLE. At or prior to the
Effective Time, FCB shall deposit, or shall cause to be
deposited, with a bank, trust company or other entity reasonably
acceptable to OSB (the "Exchange Agent"), for the benefit of the
holders of OSB Common Stock Certificates, for exchange in
accordance with this Article II, FCB Common Stock Certificates
and cash in lieu of any fractional shares of FCB Common Stock
(such cash and FCB Common Stock Certificates, together with any
dividends or distributions with respect thereto paid after the
Effective Time, being hereinafter referred to as the "Conversion
Fund") to be issued pursuant to Section 1.4 and paid pursuant to
Section 2.2(a) in exchange for outstanding shares of OSB Common
Stock.
<PAGE> 20
2.2 EXCHANGE OF CERTIFICATES.
(a) As soon as practicable after the Effective
Time, and in no event later than ten (10) business days
thereafter, the Surviving Corporation shall cause the
Exchange Agent to mail to each holder of record of one or
more OSB Common Stock Certificates a letter of transmittal
(which shall specify that delivery shall be effected, and
risk of loss and title to the OSB Common Stock Certificates
shall pass, only upon delivery of the OSB Common Stock
Certificates to the Exchange Agent) and instructions for use
in effecting the surrender of the OSB Common Stock
Certificates in exchange for FCB Common Stock Certificates
and any cash in lieu of fractional shares into which the
shares of OSB Common Stock represented by such OSB Common
Stock Certificate or Certificates shall have been converted
pursuant to this Agreement and the Plan of Merger. Upon
proper surrender of an OSB Common Stock Certificate for
exchange and cancellation to the Exchange Agent, together
with such properly completed letter of transmittal, duly
executed, the holder of such OSB Common Stock Certificate
shall be entitled to receive in exchange therefor, as
applicable, (i) a FCB Common Stock Certificate representing
that number of whole shares of FCB Common Stock to which
such holder of OSB Common Stock shall have become entitled
pursuant to the provisions of Section 1.4 hereof, and (ii) a
check representing the amount of any cash in lieu of
fractional shares that such holder has the right to receive
in respect of such OSB Common Stock Certificate, and the OSB
Common Stock Certificate so surrendered shall forthwith be
canceled. No interest will be paid or accrued on any cash
in lieu of fractional shares payable to holders of OSB
Common Stock Certificates.
(b) If any FCB Common Stock Certificate is to be
issued in a name other than that in which the OSB Common
Stock Certificate surrendered in exchange therefor is
registered, it shall be a condition of the issuance thereof
that the OSB Common Stock Certificate 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 exchange shall
pay to the Exchange Agent in advance any transfer or other
taxes required by reason of the issuance of an FCB Common
Stock Certificate in any name other than that of the
registered holder of the OSB Common Stock Certificate
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.
(c) After the Effective Time, there shall be no
transfers on the stock transfer books of OSB of the shares
of OSB Common Stock which were issued and outstanding
<PAGE> 21
immediately prior to the Effective Time. If, after the
Effective Time, OSB Common Stock Certificates are presented
for transfer to the Exchange Agent, they shall be canceled
and exchanged for FCB Common Stock Certificates representing
shares of FCB Common Stock as provided in this Article II.
(d) Notwithstanding anything to the contrary
contained herein, no certificates or scrip representing
fractional shares of FCB Common Stock shall be issued upon
the surrender for exchange of OSB Common Stock Certificates,
no dividend or distribution with respect to FCB Common Stock
shall be payable on or with respect to any fractional share,
and such fractional share interests shall not entitle the
owner thereof to vote or to any other rights of a
shareholder of the Surviving Corporation. In lieu of the
issuance of any such fractional share, the Surviving
Corporation shall pay to each former shareholder of OSB who
otherwise would be entitled to receive such fractional share
an amount in cash determined by multiplying (i) the average
of the last sales price for FCB Common Stock as reported on
The Nasdaq Stock Market for the twenty (20) trading days
immediately preceding the fifth trading day prior to the
Closing Date by (ii) the fraction of a share (rounded to the
nearest tenth when expressed as an Arabic number) of FCB
Common Stock to which such holder would otherwise be
entitled to receive pursuant to Section 1.4.
(e) Any portion of the Conversion Fund that
remains unclaimed by the shareholders of OSB for twelve (12)
months after the Effective Time shall be paid to the
Surviving Corporation. Any shareholders of OSB who have not
theretofore complied with this Article II shall thereafter
look only to the Surviving Corporation for the issuance of
certificates representing shares of FCB Common Stock and the
payment of cash in lieu of any fractional shares and any
unpaid dividends and distributions on the FCB Common Stock
deliverable in respect of each share of OSB Common Stock
such shareholder holds as determined pursuant to this
Agreement and the Plan of Merger, in each case, without any
interest thereon. Notwithstanding the foregoing, none of
FCB, OSB, the Exchange Agent or any other person shall be
liable to any former holder of shares of OSB Common Stock,
for any amount delivered in good faith to a public official
pursuant to applicable abandoned property, escheat or
similar laws.
(f) In the event any OSB Common Stock Certificate
shall have been lost, stolen or destroyed, upon the making
of an affidavit of that fact by the person claiming such OSB
Common Stock Certificate to be lost, stolen or destroyed
and, if reasonably required by the Surviving Corporation,
the posting by such person of a bond in such amount as the
Exchange Agent may determine is reasonably necessary as
<PAGE> 22
indemnity against any claim that may be made against it with
respect to such OSB Common Stock Certificate, the Exchange
Agent will issue in exchange for such lost, stolen or
destroyed OSB Common Stock Certificate an FCB Common Stock
Certificate representing the shares of FCB Common Stock and
any cash in lieu of fractional shares deliverable in respect
thereof pursuant to this Agreement and the Plan of Merger.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF OSB
OSB hereby represents and warrants to FCB as follows:
3.1 CORPORATE ORGANIZATION.
(a) OSB is a corporation duly organized and
validly existing under the laws of the State of Wisconsin.
OSB 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 (as defined below) on OSB.
OSB is duly registered as a savings and loan holding company
under the Home Owners' Loan Act ("HOLA"). True and complete
copies of the Articles of Incorporation and By-Laws of OSB,
as in effect as of the date of this Agreement, have
previously been made available by OSB to FCB. As used in
this Agreement, the term "Material Adverse Effect" means,
with respect to OSB or FCB, as the case may be, a material
adverse effect (i) on the business, assets, properties,
results of operations, financial condition, or (insofar as
they can reasonably be foreseen) prospects of such party and
its Subsidiaries, taken as a whole or (ii) on the
consummation of the Merger; PROVIDED, HOWEVER, that in no
event shall the one-time-Savings-Association-Insurance-Fund
special assessment previously imposed by the Federal Deposit
Insurance Corporation be deemed to constitute a Material
Adverse Effect on either OSB or FCB. The word "Subsidiary"
when used with respect to any party means any bank,
corporation, partnership, limited liability company, or
other organization, whether incorporated or unincorporated,
which is consolidated with such party for financial
reporting purposes.
(b) As of the date of this Agreement, OSB has, as
its sole direct or indirect Subsidiaries, Oshkosh Savings
Bank, FSB ("OSB Bank"), a federally-chartered savings
association, Oshkosh Financial, Inc., RWFV, Inc. and OSB
Investments, Inc. (collectively, the "OSB Subsidiaries").
<PAGE> 23
Except as set forth on Schedule 3.1(b) of the disclosure
schedules to this Agreement prepared and delivered by OSB
(the "OSB Disclosure Schedules"), OSB does not own any
voting stock or equity securities of any bank, corporation,
partnership, limited liability company, or other
organization, whether incorporated or unincorporated, other
than the OSB Subsidiaries.
(c) Except as set forth in Schedule 3.1(c), each
OSB Subsidiary (i) is duly organized and validly existing as
a corporation under the laws of its jurisdiction of
organization, (ii) is duly qualified to do business and in
good standing in all jurisdictions (whether federal, state,
local or foreign) where its ownership or leasing of property
or the conduct of its business requires it to be so
qualified and in which the failure to be so qualified would
have a Material Adverse Effect on OSB, and (iii) has all
requisite corporate power and authority to own or lease its
properties and assets and to carry on its business as now
conducted. Except as set forth in Schedule 3.1(c) of the
OSB Disclosure Schedules, none of the OSB Subsidiaries owns
any voting stock or equity securities of any bank,
corporation, partnership, limited liability company, or
other organization, whether incorporated or unincorporated.
(d) The minute books of OSB and of each of the
OSB Subsidiaries have been made available to FCB and
accurately reflect in all material respects all corporate
meetings held or actions taken since January 1, 1992 by the
shareholders and Boards of Directors of OSB and each OSB
Subsidiary, respectively (including committees of the Boards
of Directors of OSB and the OSB Subsidiaries).
3.2 CAPITALIZATION.
(a) The authorized capital stock of OSB consists
of 7,000,000 shares of OSB Common Stock, $0.01 par value per
share, of which, as of September 30, 1996, 1,111,484 shares
were issued and outstanding (which number excludes 48,650
shares of OSB Common Stock held by the OSB MRP (as
hereinafter defined) which have not been awarded to
participants thereunder) and 1,000,000 shares of Preferred
Stock, $0.01 par value per share, of which, as of September
30, 1996, none were issued and outstanding. As of September
30, 1996, 369,866 shares of OSB Common Stock were held in
treasury. All of the issued and outstanding shares of OSB
Common Stock have been duly authorized and validly issued
and are fully paid, nonassessable (except as otherwise
provided by Section 180.0622(2)(b) of the WBCL) and free of
preemptive rights. Except for the OSB Option Agreement and
as set forth on Schedule 3.2(a) of the OSB Disclosure
Schedules, OSB does not have and is not bound by any
outstanding subscriptions, options, warrants, calls,
<PAGE> 24
commitments or agreements of any character calling for the
purchase or issuance of any shares of OSB Common Stock or
any other equity securities of OSB or any securities
representing the right to purchase or otherwise receive any
shares of the capital stock of OSB. No shares of OSB Common
Stock have been reserved for issuance, other than the shares
of OSB Common Stock reserved for issuance under the OSB
Option Agreement and OSB Option Plan. Since September 30,
1996, OSB has not issued any shares of its capital stock or
any securities convertible into or exercisable for any
shares of its capital stock except upon exercise of stock
options pursuant to the OSB Option Plan outstanding as of
September 30, 1996 and except with respect to the OSB Stock
Option Agreement.
(b) OSB owns, directly or indirectly, all of the
issued and outstanding shares of capital stock of each of
the OSB Subsidiaries, free and clear of any liens, pledges,
charges, encumbrances and security interests whatsoever
("Liens"). All of the shares of capital stock of each OSB
Subsidiary are duly authorized and validly issued and are
fully paid, nonassessable (except as otherwise provided by
Section 180.0622(2)(b) of the WBCL) and free of preemptive
rights. No OSB Subsidiary has or is bound by any
outstanding subscriptions, options, warrants, calls,
commitments or agreements of any character calling for the
purchase or issuance of any shares of capital stock or any
other equity security of such OSB Subsidiary or any
securities representing the right to purchase or otherwise
receive any shares of capital stock or any other equity
security of such OSB Subsidiary.
3.3 AUTHORITY; NO VIOLATION. OSB has full corporate
power and authority to execute and deliver each of this
Agreement, the Plan of Merger and the Option Agreements and,
subject to shareholder and regulatory approvals, to consummate
the transactions contemplated hereby and thereby. The execution
and delivery of this Agreement, the Plan of Merger and the Option
Agreements and the consummation of the transactions contemplated
hereby and thereby have been duly and validly approved by the
Board of Directors of OSB. The Board of Directors of OSB has
directed that this Agreement and the Plan of Merger and the
transactions contemplated hereby and thereby be submitted to
OSB's shareholders for approval at a meeting of such shareholders
and, except for the adoption of this Agreement and the Plan of
Merger by the affirmative vote of the holders of a majority of
the outstanding shares of OSB Common Stock, no other corporate
proceedings on the part of OSB are necessary to approve this
Agreement, the Plan of Merger and the Option Agreements and to
consummate the transactions contemplated hereby and thereby.
This Agreement and the Option Agreements have been duly and
validly executed and delivered by OSB and (assuming due
authorization, execution and delivery by FCB) constitute valid
<PAGE> 25
and binding obligations of OSB, enforceable against OSB in
accordance with their respective terms. Furthermore, the Plan of
Merger, when executed and delivered by OSB and (assuming due
authorization, execution and delivery by FCB), shall constitute a
valid and binding obligation of OSB, enforceable against OSB in
accordance with its terms.
3.4 CONSENTS AND APPROVALS. No consents or approvals
of or filings or registrations with any court, administrative
agency or commission or other governmental authority or
instrumentality (each a "Governmental Entity") or with any third
party are necessary in connection with the execution and delivery
by OSB of this Agreement, the Plan of Merger and the Option
Agreements and the consummation by OSB of the Merger and the
other transactions contemplated hereby and thereby except for (a)
the filing by FCB and FCB Bank of an application with the Office
of Thrift Supervision (the "OTS") under HOLA and the approval of
such application (the "OTS Application"), (b) the filing with the
Securities and Exchange Commission (the "SEC") of a joint proxy
statement in definitive form relating to the meetings of OSB's
and FCB's shareholders to be held in connection with this
Agreement and the Plan of Merger and the transactions
contemplated hereby and thereby (the "Joint Proxy Statement") and
the registration statement on Form S-4 (the "S-4") in which such
Joint Proxy Statement will be included as a prospectus, (c) the
filing of Articles of Merger with the Wisconsin Department under
the WBCL, (d) such filings and approvals as are required to be
made or obtained under the securities or "Blue Sky" laws of
various states in connection with the issuance of the shares of
FCB Common Stock pursuant to this Agreement and the Plan of
Merger, and (e) the approval of this Agreement and the Plan of
Merger by the requisite vote of the shareholders of OSB and FCB.
3.5 REPORTS. OSB and each of the OSB Subsidiaries
have timely filed all reports, registrations and statements,
together with any amendments required to be made with respect
thereto, that they were required to file since July 1, 1992 with
(i) the OTS, (ii) the Federal Deposit Insurance Corporation (the
"FDIC"), (iii) any state regulatory authority (each a "State
Regulator"), (iv) the SEC, and (v) any self-regulatory
organization ("SRO") with jurisdiction over any of the activities
of OSB or any of the OSB Subsidiaries (collectively "Regulatory
Agencies"), and all other reports and statements required to be
filed by them since July 1, 1992, including, without limitation,
any report or statement required to be filed pursuant to the
laws, rules or regulations of the United States, any state, or
any Regulatory Agency, and have paid all fees and assessments due
and payable in connection therewith, except where the failure to
file such report, registration or statement or to pay such fees
and assessments, either individually or in the aggregate, will
not have a Material Adverse Effect on OSB. Except for normal
examinations conducted by a Regulatory Agency in the regular
course of the business of OSB and the OSB Subsidiaries, no
<PAGE> 26
Regulatory Agency has initiated any proceeding or, to the best
knowledge of OSB, investigation into the business or operations
of OSB or any of the OSB Subsidiaries since July 1, 1992. There
is no unresolved written violation, written criticism, or written
exception by any Regulatory Agency with respect to any report or
statement relating to any examinations of OSB or any of the OSB
Subsidiaries, which is likely, either individually or in the
aggregate, to have a Material Adverse Effect on OSB.
3.6 FINANCIAL STATEMENTS. OSB has previously made
available to FCB copies of (a) the consolidated statements of
financial condition of OSB and the OSB Subsidiaries as of
December 31, 1994 and 1995, and the related consolidated
statements of income, stockholders' equity and cash flows for the
fiscal years ended December 31, 1993, 1994 and 1995, inclusive,
as reported in OSB's Annual Report on Form 10-K for the fiscal
year ended December 31, 1995 (the "OSB Form 10-K") filed with the
SEC under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), in each case accompanied by the audit report of
Wipfli Ullrich Bertelson LLP, independent public accountants with
respect to OSB, and (b) the unaudited consolidated statements of
financial condition of OSB and the OSB Subsidiaries as of June
30, 1996, and the related unaudited consolidated statements of
income, stockholders' equity and cash flows for the three- and
six-month periods then ended as reported in OSB's Quarterly
Report on Form 10-Q for the period ended June 30, 1996 filed with
the SEC under the Exchange Act (the "OSB Second Quarter 10-Q").
The December 31, 1995 consolidated statements of financial
condition of OSB (including the related notes, where applicable)
fairly present the consolidated financial position of OSB and the
OSB Subsidiaries as of the dates thereof, and the other financial
statements referred to in this Section 3.6 or included in the OSB
Reports (including the related notes, where applicable) fairly
present the results of the consolidated operations and
stockholders' equity and consolidated financial position of OSB
and the OSB Subsidiaries for the respective fiscal periods or as
of the respective dates therein set forth, subject, in the case
of the unaudited statements, to recurring audit adjustments
normal in nature and amount; each of such statements (including
the related notes, where applicable) comply in all material
respects with applicable accounting requirements and with the
published rules and regulations of the SEC with respect thereto;
and each of such statements (including the related notes, where
applicable) has been prepared in all material respects in
accordance with generally accepted accounting principles ("GAAP")
consistently applied during the periods involved, except, in each
case, as indicated in such statements or in the notes thereto or,
in the case of unaudited statements, as permitted by Form 10-Q.
3.7 BROKER'S FEES. Other than OSB's arrangement with
Edelman & Co., Ltd. to serve as a financial advisor to OSB in
connection with the Merger and related transactions contemplated
by this Agreement and the Plan of Merger, neither OSB nor any OSB
<PAGE> 27
Subsidiary nor any of their respective officers or directors has
employed any financial advisor, broker or finder or incurred any
liability for any financial advisory fees, broker's fees,
commissions or finder's fees in connection with the Merger or
related transactions contemplated by this Agreement and the Plan
of Merger.
3.8 ABSENCE OF CERTAIN CHANGES OR EVENTS.
(a) Except as publicly disclosed in the OSB
Reports (as defined in Section 3.12) filed prior to the date
hereof or as set forth in Schedule 3.8(a), since December
31, 1995, (i) OSB and the OSB Subsidiaries taken as a whole
have not incurred any material liability, except in the
ordinary course of their respective businesses, and (ii) no
event has occurred which has had, individually or in the
aggregate, a Material Adverse Effect on OSB or will have a
Material Adverse Effect on OSB.
(b) Except as publicly disclosed in the OSB
Reports filed prior to the date hereof, since December 31,
1995, OSB and the OSB Subsidiaries have conducted their
respective businesses in all material respects in the
ordinary and usual course.
3.9 LEGAL PROCEEDINGS.
(a) Except as set forth in Schedule 3.9, there
are no pending or, to the best of OSB's knowledge,
threatened, legal, administrative, arbitration or other
proceedings, claims, actions or governmental or regulatory
investigations of any nature against OSB or any of the OSB
Subsidiaries or challenging the validity or propriety of the
transactions contemplated by this Agreement, the Plan of
Merger or the Option Agreements.
(b) There is no injunction, order, judgment,
decree, or regulatory restriction (other than regulatory
restrictions that apply to similarly situated savings and
loan holding companies or savings associations) imposed upon
OSB, any of the OSB Subsidiaries or the assets of OSB or any
of the OSB Subsidiaries.
3.10 TAXES AND TAX RETURNS.
(a) Each of OSB and the OSB Subsidiaries has duly
filed all federal, state, county, foreign and, to the best
of OSB's knowledge, local information returns and tax
returns required to be filed by it (all such returns being
accurate and complete in all material respects) and has duly
paid or made provisions for the payment of all Taxes (as
defined in Section 3.10(b)) and other governmental charges
which have been incurred or are due or claimed to be due
<PAGE> 28
from it by federal, state, county, foreign or local taxing
authorities on or prior to the date of this Agreement
(including, without limitation, if and to the extent
applicable, those due in respect of its properties, income,
business, capital stock, deposits, franchises, licenses,
sales and payrolls) other than Taxes or other charges which
are not yet delinquent or are being contested in good faith
and have not been finally determined. The income tax
returns of OSB and the OSB Subsidiaries remain open for the
applicable statutory time periods and any deficiencies,
penalties or assessments have been paid or provided for in
OSB's consolidated financial statements. There are no
material disputes pending with respect to, or claims
asserted for, Taxes or assessments upon OSB or any of the
OSB Subsidiaries for which OSB does not have adequate
reserves, nor has OSB or any of the OSB Subsidiaries given
any currently effective waivers extending the statutory
period of limitation applicable to any federal, state,
county, foreign or local income tax return for any period.
In addition, (i) proper and accurate amounts have been
withheld by OSB and each of the OSB Subsidiaries from their
employees for all prior periods in compliance in all
material respects with the tax withholding provisions of
applicable federal, state, foreign and local laws, except
where failure to do so would not have a Material Adverse
Effect on OSB, (ii) federal, state, foreign, county and
local returns which are accurate and complete in all
material respects have been filed by OSB and each of the OSB
Subsidiaries for all periods for which returns were due with
respect to income tax withholding, Social Security and
unemployment taxes, (iii) the amounts shown on such federal,
state, foreign, local or county returns to be due and
payable have been paid in full or adequate provision
therefor has been included by OSB in its consolidated
financial statements as of December 31, 1995, and (iv) there
are no Tax liens upon any property or assets of OSB or any
of the OSB Subsidiaries except liens for current taxes not
yet due. Except as set forth in Schedule 3.10(a), neither
OSB nor any of the OSB Subsidiaries has been required to
include in income any adjustment pursuant to Section 481 of
the Code by reason of a voluntary change in accounting
method initiated by OSB or any of the OSB Subsidiaries, and
the Internal Revenue Service (the "IRS") has not initiated
or proposed any such adjustment or change in accounting
method. Except as set forth in the financial statements
described in Section 3.6, neither OSB nor any of the OSB
Subsidiaries has entered into a transaction which is being
accounted for as an installment obligation under Section 453
of the Code.
(b) As used in this Agreement, the term "Tax" or
"Taxes" means all federal, state, county, local, and foreign
income, excise, gross receipts, gross income, ad valorem,
<PAGE> 29
profits, gains, property, capital, sales, transfer, use,
payroll, employment, severance, withholding, duties,
intangibles, franchise, backup withholding, and other taxes,
charges, levies or like assessments together with all
penalties and additions to tax and interest thereon.
3.11 EMPLOYEES.
(a) Schedule 3.11(a) of the OSB Disclosure
Schedules sets forth a true and complete list of each
employee benefit plan, arrangement, commitment, agreement or
understanding that is maintained as of the date of this
Agreement (the "OSB Benefit Plans") (i) by OSB or any of the
OSB Subsidiaries or (ii) by any trade or business, whether
or not incorporated which (A) is under "common control," as
described in Section 414(c) of the Code, with OSB, (B) is a
member of a "controlled group," as defined in Section 414(b)
of the Code, or (C) is a member of an "affiliated service
group," as defined in Section 414(m) of the Code, which
includes OSB (an "OSB ERISA Affiliate"), all of which
together with OSB would be deemed a "single employer" within
the meaning of Section 4001 of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA").
(b) OSB has heretofore delivered to FCB true and
complete copies of each of the OSB Benefit Plans and certain
related documents, including, but not limited to, (i) the
Annual Report Form 5500 for such OSB Benefit Plan (if
applicable) for each of the last two years, and (ii) the
most recent determination letter from the IRS (if
applicable) for such OSB Benefit Plan.
(c) (i) Each of the OSB Benefit Plans has been
operated and administered in all material respects with
applicable laws, including, but not limited to, ERISA and
the Code, (ii) each of the OSB Benefit Plans intended to be
"qualified" within the meaning of Section 401(a) of the Code
is so qualified, (iii) no OSB Benefit Plan provides
benefits, including, without limitation, death or medical
benefits (whether or not insured), with respect to current
or former employees of OSB, the OSB Subsidiaries or any OSB
ERISA Affiliate beyond their retirement or other termination
of service, other than (A) coverage mandated by applicable
law, (B) death benefits, disability benefits or retirement
benefits under any "employee pension plan" (as such term is
defined in Section 3(2) of ERISA), (C) deferred compensation
benefits accrued as liabilities on the books of OSB, the OSB
Subsidiaries or the OSB ERISA Affiliates, or (D) benefits
the full cost of which is borne by the current or former
employee (or his beneficiary), (iv) neither OSB, the OSB
Subsidiaries nor any OSB ERISA Affiliate maintains or has
ever maintained a plan subject to Title IV of ERISA, (v)
neither OSB, the OSB Subsidiaries nor any OSB ERISA
<PAGE> 30
Affiliate contributes to or has ever contributed to a
"Multiemployer" pension plan (as such term is defined in
Section 3(37) of ERISA, (vi) all contributions or other
amounts payable by OSB or the OSB Subsidiaries as of the
Effective Time with respect to each OSB Benefit Plan in
respect of current or prior plan years have been paid or
accrued in accordance with GAAP and Section 412 of the Code,
(vii) neither OSB, the OSB Subsidiaries nor any OSB ERISA
Affiliate has engaged in a transaction in connection with
which OSB, the OSB Subsidiaries or any OSB ERISA Affiliate
reasonably could be subject to either a material civil
penalty assessed pursuant to Section 409 or 502(i) of ERISA
or a material tax imposed pursuant to Sections 4975 or 4976
of the Code, and (viii) to the best knowledge of OSB, there
are no pending, threatened or anticipated claims (other than
routine claims for benefits) by, on behalf of or against any
of the OSB Benefit Plans or any trusts related thereto which
are, in the reasonable judgment of OSB, likely, either
individually or in the aggregate, to have a Material Adverse
Effect on OSB.
3.12 SEC REPORTS. OSB and each of the OSB Subsidiaries
has made available to FCB an accurate and complete copy of each
(a) final registration statement, prospectus, report, schedule
and definitive proxy statement filed since December 31, 1991 by
OSB with the SEC pursuant to the Securities Act of 1933, as
amended (the "Securities Act"), or the Exchange Act
(collectively, "OSB Reports"), and (b) communication mailed by
OSB to its shareholders since December 31, 1991. None of the OSB
Reports or such communications to shareholders, as of their
respective dates, contained any untrue statement of a material
fact or omitted to state any material fact required to be stated
therein or necessary in order to make the statements therein, in
light of the circumstances in which they were made, not
misleading. Since December 31, 1991, OSB has timely filed all
OSB Reports and other documents required to be filed by it under
the Securities Act and the Exchange Act, and, as of their
respective dates, all OSB Reports complied in all material
respects with the published rules and regulations of the SEC with
respect thereto.
3.13 COMPLIANCE WITH APPLICABLE LAW. OSB and each of
the OSB Subsidiaries hold all licenses, franchises, permits and
authorizations necessary for the lawful conduct of their
respective businesses under and pursuant to all, and have
complied with and are not in default under any, applicable laws,
statutes, orders, rules, regulations, policies and/or guidelines
of any Governmental Entity relating to OSB or any of the OSB
Subsidiaries, except where the failure to hold such license,
franchise, permit or authorization or such noncompliance or
default would not, individually or in the aggregate, have a
Material Adverse Effect on OSB.
<PAGE> 31
3.14 CERTAIN CONTRACTS.
(a) Except as set forth in Schedule 3.14(a) of
the OSB Disclosure Schedules, neither OSB nor any of the OSB
Subsidiaries is a party to or bound by:
(i) any contract, arrangement, commitment or
understanding (whether written or oral) with respect to
the employment or compensation of any directors,
officers or employees;
(ii) any contract, arrangement, commitment or
understanding (whether written or oral) which, upon the
consummation of the transactions contemplated by this
Agreement or the Plan of Merger will (either alone or
upon the occurrence of any additional acts or events)
result in any payment (including, without limitation,
severance, unemployment compensation, golden parachute
or otherwise) becoming due from OSB, FCB, the Surviving
Corporation, or any of their respective Subsidiaries to
any officer, director or employee thereof or to the
trustee under any "rabbi trust" or similar arrangement;
(iii) any contract, arrangement,
commitment or understanding (whether written or oral)
which materially restricts the conduct of any line of
business by OSB; or
(iv) any contract, arrangement, commitment or
understanding (whether written or oral), including any
stock option plan, stock appreciation rights plan,
restricted stock plan or stock purchase plan, any of
the benefits of which will be increased or be required
to be paid, or the vesting of the benefits of which
will be accelerated, by the occurrence of any of the
transactions contemplated by this Agreement or the Plan
of Merger, or the value of any of the benefits of which
will be calculated on the basis of any of the
transactions contemplated by this Agreement or the Plan
of Merger.
OSB has previously made available to FCB true and correct
copies of all employment and deferred compensation
arrangements which are in writing and to which OSB or an OSB
Subsidiary is a party. Each contract, arrangement,
commitment or understanding of the type described in this
Section 3.14(a), is referred to herein as an "OSB Contract,"
and neither OSB nor any of the OSB Subsidiaries knows of, or
has received notice of, any violation of any OSB Contract by
any of the other parties thereto, which, individually or in
the aggregate, would have a Material Adverse Effect on OSB.
<PAGE> 32
(b) (i) Each OSB Contract is valid and binding on
OSB or the applicable OSB Subsidiary, as the case may be,
and is in full force and effect, (ii) OSB and each of the
OSB Subsidiaries has performed all obligations required to
be performed by it to date under each OSB Contract to which
it is a party, except where such noncompliance, individually
or in the aggregate, would not have a Material Adverse
Effect on OSB, and (iii) no event or condition exists which
constitutes or, after notice or lapse of time or both, would
constitute, a default on the part of OSB or any of the OSB
Subsidiaries under any such OSB Contract, except where any
such default, individually or in the aggregate, would not
have a Material Adverse Effect on OSB.
3.15 AGREEMENTS WITH REGULATORY AGENCIES. Neither OSB
nor any of the OSB Subsidiaries is subject to any cease-and-
desist or other order issued by, or is a party to any written
agreement, consent agreement or memorandum of understanding with,
or is a party to any commitment letter or similar undertaking to,
or is subject to any order or directive by, or has been since
December 31, 1991, a recipient of any supervisory letter from, or
since December 31, 1991, has adopted any board resolutions at the
request of any Regulatory Agency or other Governmental Entity
that currently restricts the conduct of its business or that
relates to its capital adequacy, compliance with laws, its credit
policies, its management or its business (each, whether or not
set forth in the OSB Disclosure Schedules, an "OSB Regulatory
Agreement"), nor has OSB or any of the OSB Subsidiaries been
advised since December 31, 1991 by any Regulatory Agency or other
Governmental Entity that it is considering issuing or requesting
any such OSB Regulatory Agreement.
3.16 OTHER ACTIVITIES OF OSB AND ITS OSB SUBSIDIARIES.
Neither OSB nor any of the OSB Subsidiaries that is neither a
savings association, a savings association operating subsidiary
or a savings association service corporation directly or
indirectly engages in any activity prohibited by the OTS.
Without limiting the generality of the foregoing, no equity
investment of OSB or any OSB Subsidiary that is neither a savings
association, a savings association operating subsidiary nor a
savings association service corporation is prohibited by the OTS.
3.17 INVESTMENT SECURITIES. Each of OSB and the OSB
Subsidiaries has good and marketable title to all securities held
by it (except securities sold under repurchase agreements or held
in any fiduciary or agency capacity), free and clear of any Lien,
except to the extent such securities are pledged in the ordinary
course of business consistent with prudent banking practices to
secure obligations of OSB or any of the OSB Subsidiaries. Such
securities are valued on the books of OSB and the OSB
Subsidiaries in accordance with GAAP.
<PAGE> 33
3.18 UNDISCLOSED LIABILITIES. Except for those
liabilities that are fully reflected or reserved against on the
consolidated statement of financial condition of OSB included in
the OSB Second Quarter 10-Q, liabilities disclosed in Schedule
3.18 of the OSB Disclosure Schedules, and liabilities incurred in
the ordinary course of business consistent with past practice
since June 30, 1996, neither OSB nor any of the OSB Subsidiaries
has incurred any liability of any nature whatsoever (whether
absolute, accrued, contingent or otherwise and whether due or to
become due) that, either alone or when combined with all similar
liabilities, has had, or could reasonably be expected to have, a
Material Adverse Effect on OSB.
3.19 INSURANCE. Schedule 3.19 of the OSB Disclosure
Schedules describes all policies of insurance in which OSB or any
of the OSB Subsidiaries is named as an insured party or which
otherwise relate to or cover any assets or properties of OSB or
any of the OSB Subsidiaries. Each of such policies is in full
force and effect, and the coverage provided under such properties
complies with the requirements of any contracts binding on OSB or
any of the OSB Subsidiaries relating to such assets or
properties. Except as set forth in Schedule 3.19 of the OSB
Disclosure Schedules, neither OSB nor any of the OSB Subsidiaries
has received any notice of cancellation or termination with
respect to any material insurance policy of OSB or any of the OSB
Subsidiaries.
3.20 LOAN LOSS RESERVES. The reserve for possible loan
losses shown on the June 30, 1996 call report filed for OSB Bank
is adequate in all material respects under the requirements of
GAAP to provide for possible losses, net of recoveries relating
to loans previously charged off, on loans outstanding (including
accrued interest receivable) as of June 30, 1996. The aggregate
loan balances of OSB Bank at such date in excess of such reserves
are, to the best knowledge and belief of OSB, collectible in
accordance with their terms.
3.21 ENVIRONMENTAL LIABILITY. Except as set forth in
Schedule 3.21, there are no legal, administrative, arbitration or
other proceedings, claims, actions, causes of action, private
environmental investigations or remediation activities or
governmental investigations of any nature pending or, to the best
of OSB's knowledge, threatened against OSB seeking to impose, or
that could reasonably result in the imposition, on OSB of any
liability or obligation arising under common law or under any
local, state, federal or foreign environmental statute,
regulation or ordinance including, without limitation, the
Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended ("CERCLA") which, insofar as reasonably
can be foreseen, could have a Material Adverse Effect on OSB.
Except as set forth in Schedule 3.21, to the best of
OSB's knowledge, there is no reasonable basis for any proceeding,
<PAGE> 34
claim, action or governmental investigation that would impose any
such liability or obligation which, insofar as reasonably can be
foreseen, could have a Material Adverse Effect on OSB. OSB is
not subject to any agreement, order, judgment, decree, letter or
memorandum by or with any court, governmental authority,
regulatory agency or third party imposing any such liability or
obligation which, insofar as reasonably can be foreseen, could
have a Material Adverse Effect on OSB.
3.22 APPROVAL DELAYS. OSB knows of no reason why any
of the Requisite Regulatory Approvals (as defined in Section
7.1(b)) should be denied or unduly delayed.
3.23 VOTE REQUIRED. The approval by the holders of a
majority of the votes entitled to be cast by all holders of OSB
Common Stock to approve the Merger is the only vote of the
holders of any class or series of the capital stock of OSB
required for any of the transactions contemplated by this
Agreement, the Plan of Merger and the Option Agreements;
PROVIDED, HOWEVER, that the approval of shareholders of OSB may
be required for the repurchase of shares of OSB Common Stock
pursuant to Section 8 of the OSB Stock Option Agreement under
circumstances where Section 180.1134 of the WBCL would be
applicable.
3.24 APPLICABILITY OF CERTAIN PROVISIONS OF WISCONSIN
LAW, ETC. Assuming the representations and warranties of FCB
made in Section 4.25 are correct, none of the "control share
voting" provisions of Section 180.1150 of the WBCL, the "business
combination" provisions of Sections 180.1140 to 180.1144 of the
WBCL, the "fair price" provisions of Section 180.1130 to 180.1133
of the WBCL, or any other takeover related provisions of the WBCL
(or, to the knowledge of OSB, any other similar state statute) or
the Articles of Incorporation or By-Laws of OSB, are applicable
to the transactions contemplated by this Agreement and the Plan
of Merger, including the granting or exercise of the OSB Stock
Option Agreement, except for the limitations set forth in Article
XIII(B) of the Articles of Incorporation of OSB.
3.25 OWNERSHIP OF FCB COMMON STOCK. Except as set
forth in Schedule 3.25 of the OSB Disclosure Schedules and except
pursuant to the terms of the FCB Stock Option Agreement, OSB does
not "beneficially own" (as such term is defined for purposes of
Section 13(d) of the Exchange Act) any shares of FCB Common
Stock.
<PAGE> 35
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF FCB
FCB hereby represents and warrants to OSB as follows:
4.1 CORPORATE ORGANIZATION.
(a) FCB is a corporation duly organized and
validly existing under the laws of the State of Wisconsin.
FCB 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 FCB. FCB is duly
registered as a savings and loan holding company under HOLA.
True and complete copies of the Articles of Incorporation
and By-Laws of FCB, as in effect as of the date of this
Agreement, have previously been made available by FCB to
OSB.
(b) As of the date of this Agreement, FCB has, as
its sole direct or indirect subsidiaries, FCB Bank, a
federally-chartered savings association, Fox Cities
Financial Services, Inc. and Fox Cities Investments, Inc.
(the "FCB Subsidiaries"). Except as set forth on Schedule
4.1(b) of the disclosure schedules to this Agreement
prepared and delivered by FCB (the "FCB Disclosure
Schedules"), FCB does not own any voting stock or equity
securities of any bank, corporation, partnership, limited
liability company, or other organization, whether
incorporated or unincorporated, other than the FCB
Subsidiaries.
(c) Each FCB Subsidiary (i) is duly organized and
validly existing as a corporation under the laws of its
jurisdiction of organization, (ii) is duly qualified to do
business and in good standing in all jurisdictions (whether
federal, state, local or foreign) where its ownership or
leasing of property or the conduct of its business requires
it to be so qualified and in which the failure to be so
qualified would have a Material Adverse Effect on FCB, and
(iii) has all requisite corporate power and authority to own
or lease its properties and assets and to carry on its
business as now conducted. Except as set forth in Schedule
4.1(c) of the FCB Disclosure Schedules, none of the FCB
Subsidiaries owns any voting stock or equity securities of
any bank, corporation, partnership, limited liability
company, or other organization, whether incorporated or
unincorporated.
<PAGE> 36
(d) The minute books of FCB and of each of the
FCB Subsidiaries have been made available to OSB and
accurately reflect in all material respects all corporate
meetings held or actions taken since January 1, 1992 by the
shareholders and Boards of Directors of FCB and each FCB
Subsidiary, respectively (including committees of the Boards
of Directors of FCB and the FCB Subsidiaries).
4.2 CAPITALIZATION.
(a) The authorized capital stock of FCB consists
of 15,000,000 shares of common stock, $0.01 par value per
share, of which, as of September 30, 1996, 2,459,614 shares
were issued and outstanding and 5,000,000 shares of
Preferred Stock, $0.01 par value per share, of which, as of
September 30, 1996, none were issued and outstanding. As of
September 30, 1996, 449,886 shares of FCB Common Stock were
held in treasury. All of the issued and outstanding shares
of FCB Common Stock have been duly authorized and validly
issued and are fully paid, nonassessable (except as
otherwise provided by Section 180.0622(2)(b) of the WBCL)
and free of preemptive rights. Except for the FCB Option
Agreement and as set forth on Schedule 4.2(a) of the FCB
Disclosure Schedules, FCB does not have and is not bound by
any outstanding subscriptions, options, warrants, calls,
commitments or agreements of any character calling for the
purchase or issuance of any shares of FCB Common Stock or
any other equity securities of FCB or any securities
representing the right to purchase or otherwise receive any
shares of the capital stock of FCB. No shares of FCB Common
Stock have been reserved for issuance, other than the shares
of FCB Common Stock reserved for issuance under the FCB
Option Agreement and the FCB Financial Corp. 1993 Stock
Option and Incentive Plan (the "FCB Option Plan"). Since
September 30, 1996, FCB has not issued any shares of its
capital stock or any securities convertible into or
exercisable for any shares of its capital stock except upon
exercise of stock options pursuant to the FCB Option Plan
outstanding as of September 30, 1996 and except with respect
to the FCB Stock Option Agreement.
(b) FCB owns, directly or indirectly, all of the
issued and outstanding shares of capital stock of each of
the FCB Subsidiaries, free and clear of any Liens. All of
the shares of capital stock of each FCB Subsidiary are duly
authorized and validly issued and are fully paid,
nonassessable (except as otherwise provided by Section
180.0622(2)(b) of the WBCL) and free of preemptive rights.
No FCB Subsidiary has or is bound by any outstanding
subscriptions, options, warrants, calls, commitments or
agreements of any character calling for the purchase or
issuance of any shares of capital stock or any other equity
security of such FCB Subsidiary or any securities
<PAGE> 37
representing the right to purchase or otherwise receive any
shares of capital stock or any other equity security of such
FCB Subsidiary.
4.3 AUTHORITY; NO VIOLATION. FCB has full corporate
power and authority to execute and deliver each of this
Agreement, the Plan of Merger and the Option Agreements, subject
to shareholder and regulatory approvals, and to consummate the
transactions contemplated hereby and thereby. The execution and
delivery of this Agreement, the Plan of Merger and the Option
Agreements and the consummation of the transactions contemplated
hereby and thereby have been duly and validly approved by the
Board of Directors of FCB. The Board of Directors of FCB has
directed that this Agreement and the Plan of Merger and the
transactions contemplated hereby and thereby be submitted to
FCB's shareholders for approval at a meeting of such shareholders
and, except for the adoption of this Agreement and the Plan of
Merger and the transactions contemplated hereby and thereby by
the affirmative vote of the holders of a majority of the
outstanding shares of FCB Common Stock, no other corporate
proceedings on the part of FCB are necessary to approve this
Agreement, the Plan of Merger and the Option Agreements and to
consummate the transactions contemplated hereby and thereby.
This Agreement and the Option Agreements have been duly and
validly executed and delivered by FCB and (assuming due
authorization, execution and delivery by OSB) constitute valid
and binding obligations of FCB, enforceable against FCB in
accordance with their respective terms. Furthermore, the Plan of
Merger, when executed and delivered by FCB and (assuming due
authorization, execution and delivery by OSB), shall constitute a
valid and binding obligation of FCB, enforceable against FCB in
accordance with its terms.
4.4 CONSENTS AND APPROVALS. No consents or approvals
of or filings or registrations with any Governmental Entity or
with any third party are necessary in connection with the
execution and delivery by FCB of this Agreement, the Plan of
Merger and the Option Agreements and the consummation by FCB of
the Merger and the other transactions contemplated hereby and
thereby except for (a) the filing by FCB and FCB Bank of an
application with the OTS under HOLA and the approval of the OTS
Application, (b) the filing with the SEC of the Joint Proxy
Statement in definitive form relating to the meetings of OSB's
and FCB's shareholders to be held in connection with this
Agreement and the Plan of Merger and the transactions
contemplated hereby and thereby in which such Joint Proxy
Statement will be included as a prospectus, (c) the filing of
Articles of Merger with the Wisconsin Department under the WBCL,
(d) such filings and approvals as are required to be made or
obtained under the securities or "Blue Sky" laws of various
states in connection with the issuance of the shares of FCB
Common Stock pursuant to this Agreement and the Plan of Merger,
<PAGE> 38
and (e) the approval of this Agreement and Plan of Merger by the
requisite vote of the shareholders of FCB and OSB.
.
4.5 REPORTS. FCB and each of the FCB Subsidiaries
have timely filed all reports, registrations and statements,
together with any amendments required to be made with respect
thereto, that they were required to file since October 1, 1993
with the Regulatory Agencies, and all other reports and
statements required to be filed by them since October 1, 1993,
including, without limitation, any report or statement required
to be filed pursuant to the laws, rules or regulations of the
United States, any state, or any Regulatory Agency, and have paid
all fees and assessments due and payable in connection therewith,
except where the failure to file such report, registration or
statement or to pay such fees and assessments, either
individually or in the aggregate, will not have a Material
Adverse Effect on FCB. Except for normal examinations conducted
by a Regulatory Agency in the regular course of the business of
FCB or the FCB Subsidiaries, no Regulatory Agency has initiated
any proceeding or, to the best knowledge of FCB, investigation
into the business or operations of FCB or any of the FCB
Subsidiaries since October 1, 1993. There is no unresolved
written violation, written criticism, or written exception by any
Regulatory Agency with respect to any report or statement
relating to any examinations of FCB or any of the FCB
Subsidiaries, which is likely, either individually or in the
aggregate, to have a Material Adverse Effect on FCB.
4.6 FINANCIAL STATEMENTS. FCB has previously made
available to OSB copies of (a) the consolidated statements of
financial condition of FCB and the FCB Subsidiaries as of March
31, 1995 and 1996, and the related consolidated statements of
income, shareholders' equity and cash flows for the fiscal years
ended March 31, 1994, 1995 and 1996, inclusive, as reported in
FCB's Annual Report on Form 10-K for the fiscal year ended March
31, 1996 (the "FCB Form 10-K") filed with the SEC under the
Exchange Act, in each case accompanied by the audit report of
Wipfli Ullrich Bertelson LLP, independent public accountants with
respect to FCB, and (b) the unaudited consolidated statements of
financial condition of FCB and the FCB Subsidiaries as of June
30, 1996, and the related unaudited consolidated statements of
income, shareholders' equity and cash flows for the three-month
period then ended as reported in FCB's Quarterly Report on Form
10-Q for the period ended June 30, 1996 filed with the SEC under
the Exchange Act (the "FCB First Quarter 10-Q"). The March 31,
1996 consolidated statements of financial condition of FCB
(including the related notes, where applicable) fairly present
the consolidated financial position of FCB and the FCB
Subsidiaries as of the dates thereof, and the other financial
statements referred to in this Section 4.6 or included in the FCB
Reports (including the related notes, where applicable) fairly
present the results of the consolidated operations and
shareholders' equity and consolidated financial position of FCB
<PAGE> 39
and the FCB Subsidiaries for the respective fiscal periods or as
of the respective dates therein set forth, subject, in the case
of the unaudited statements, to recurring audit adjustments
normal in nature and amount; each of such statements (including
the related notes, where applicable) comply in all material
respects with applicable accounting requirements and with the
published rules and regulations of the SEC with respect thereto;
and each of such statements (including the related notes, where
applicable) has been prepared in all material respects in
accordance with GAAP consistently applied during the periods
involved, except, in each case, as indicated in such statements
or in the notes thereto or, in the case of unaudited statements,
as permitted by Form 10-Q.
4.7 BROKER'S FEES. Other than FCB's arrangement with
RP Financial, LC. to serve as a financial advisor to FCB in
connection with the Merger and related transactions contemplated
by this Agreement and the Plan of Merger, neither FCB nor any FCB
Subsidiary nor any of their respective officers or directors has
employed any financial advisor, broker or finder or incurred any
liability for any financial advisory fees, broker's fees,
commissions or finder's fees in connection with the Merger or
related transactions contemplated by this Agreement and the Plan
of Merger.
4.8 ABSENCE OF CERTAIN CHANGES OR EVENTS.
(a) Except as publicly disclosed in the FCB
Reports (as defined in Section 4.12) filed prior to the date
hereof or as set forth in Schedule 4.8(a), since December
31, 1995, (i) FCB and the FCB Subsidiaries taken as a whole
have not incurred any material liability, except in the
ordinary course of their business, and (ii) no event has
occurred which has had, individually or in the aggregate, a
Material Adverse Effect on FCB or will have a Material
Adverse Effect on FCB.
(b) Except as publicly disclosed in the FCB
Reports filed prior to the date hereof, since December 31,
1995, FCB and each FCB Subsidiary have carried on their
respective businesses in all material respects in the
ordinary and usual course.
4.9 LEGAL PROCEEDINGS.
(a) Except as set forth in Schedule 4.9, there
are no pending or, to the best of FCB's knowledge,
threatened, legal, administrative, arbitration or other
proceedings, claims, actions or governmental or regulatory
investigations of any nature against FCB or any of the FCB
Subsidiaries or challenging the validity or propriety of the
transactions contemplated by this Agreement, the Plan of
Merger or the Option Agreements.
<PAGE> 40
(b) There is no injunction, order, judgment,
decree, or regulatory restriction (other than regulatory
restrictions that apply to similarly situated savings and
loan holding companies or savings associations) imposed upon
FCB, any of the FCB Subsidiaries or the assets of FCB or any
of the FCB Subsidiaries.
4.10 TAXES AND TAX RETURNS. Each of FCB and the FCB
Subsidiaries has duly filed all federal, state, county, foreign
and, to the best of FCB's knowledge, local information returns
and tax returns required to be filed by it on or prior to the
date hereof (all such returns being accurate and complete in all
material respects) and has duly paid or made provisions for the
payment of all Taxes and other governmental charges which have
been incurred or are due or claimed to be due from it by federal,
state, county, foreign or local taxing authorities on or prior to
the date of this Agreement (including, without limitation, if and
to the extent applicable, those due in respect of its properties,
income, business, capital stock, deposits, franchises, licenses,
sales and payrolls) other than Taxes or other charges which are
not yet delinquent or are being contested in good faith and have
not been finally determined. The income tax returns of FCB and
the FCB Subsidiaries remain open for the applicable statutory
time periods and any deficiencies, penalties or assessments have
been paid or provided for in FCB's consolidated financial
statements. There are no material disputes pending with respect
to, or claims asserted for, Taxes or assessments upon FCB or any
of the FCB Subsidiaries for which FCB does not have adequate
reserves, nor has FCB or any of the FCB Subsidiaries given any
currently effective waivers extending the statutory period of
limitation applicable to any federal, state, county, foreign or
local income tax return for any period. In addition, (i) proper
and accurate amounts have been withheld by FCB and each of the
FCB Subsidiaries from their employees for all prior periods in
compliance in all material respects with the tax withholding
provisions of applicable federal, state, foreign and local laws,
except where failure to do so would not have a Material Adverse
Effect on FCB, (ii) federal, state, foreign, county and local
returns which are accurate and complete in all material respects
have been filed by FCB and each of the FCB Subsidiaries for all
periods for which returns were due with respect to income tax
withholding, Social Security and unemployment taxes, (iii) the
amounts shown on such federal, state, foreign, local or county
returns to be due and payable have been paid in full or adequate
provision therefor has been included by FCB in its consolidated
financial statements as of March 31, 1996, and (iv) there are no
Tax liens upon any property or assets of FCB or any of the FCB
Subsidiaries except liens for current taxes not yet due. Except
as set forth in Schedule 4.10(a), neither FCB nor any of the FCB
Subsidiaries has been required to include in income any
adjustment pursuant to Section 481 of the Code by reason of a
voluntary change in accounting method initiated by FCB or any of
the FCB Subsidiaries, and the IRS has not initiated or proposed
<PAGE> 41
any such adjustment or change in accounting method. Except as
set forth in the financial statements described in Section 4.6,
neither FCB nor any of the FCB Subsidiaries has entered into a
transaction which is being accounted for as an installment
obligation under Section 453 of the Code.
4.11 EMPLOYEES.
(a) Schedule 4.11 of the FCB Disclosure Schedules
sets forth a true and complete list of each employee benefit
plan, arrangement, commitment, agreement or understanding
that is maintained as of the date of this Agreement (the
"FCB Benefit Plans") (i) by FCB or any of the FCB
Subsidiaries or (ii) by any trade or business, whether or
not incorporated, which (A) is under "common control," as
described in Section 414(c) of the Code, with FCB, (B) is a
member of a "controlled group," as defined in Section 414(b)
of the Code, or (C) is a member of an "affiliated service
group," as defined in Section 414(m) of the Code which
includes FCB (an "FCB ERISA Affiliate"), all of which
together with FCB would be deemed a "single employer" within
the meaning of Section 4001 of ERISA.
(b) FCB has heretofore delivered to OSB true and
complete copies of the FCB Benefit Plans and certain related
documents, including, but not limited to, (i) the Annual
Report Form 5500 for such FCB Benefit Plan (if applicable)
for each of the last two years, and (ii) the most recent
determination letter from the IRS (if applicable) for such
FCB Benefit Plan.
(c) (i) Each of the FCB Benefit Plans has been
operated and administered in all material respects with
applicable laws, including, but not limited to, ERISA and
the Code, (ii) each of the FCB Benefit Plans intended to be
"qualified" within the meaning of Section 401(a) of the Code
is so qualified, (iii) no FCB Benefit Plan provides
benefits, including, without limitation, death or medical
benefits (whether or not insured), with respect to current
or former employees of FCB, the FCB Subsidiaries or any FCB
ERISA Affiliate beyond their retirement or other termination
of service, other than (A) coverage mandated by applicable
law, (B) death benefits, disability benefits or retirement
benefits under any "employee pension plan" (as such term is
defined in Section 3(2) of ERISA), (C) deferred compensation
benefits accrued as liabilities on the books of FCB, the FCB
Subsidiaries or the FCB ERISA Affiliates, or (D) benefits
the full cost of which is borne by the current or former
employee (or his beneficiary), (iv) neither FCB, the FCB
Subsidiaries nor any FCB ERISA Affiliate maintains or has
ever maintained a plan subject to Title IV of ERISA, (v)
neither FCB, the FCB Subsidiaries nor any FCB ERISA
Affiliate contributes to or has ever contributed to a
<PAGE> 42
"Multiemployer" pension plan (as such term is defined in
Section 3(37) of ERISA, (vi) all contributions or other
amounts payable by FCB or the FCB Subsidiaries as of the
Effective Time with respect to each FCB Benefit Plan in
respect of current or prior plan years have been paid or
accrued in accordance with GAAP and Section 412 of the Code,
(vii) neither FCB, the FCB Subsidiaries nor any FCB ERISA
Affiliate has engaged in a transaction in connection with
which FCB, the FCB Subsidiaries or any ERISA Affiliate
reasonably could be subject to either a material civil
penalty assessed pursuant to Section 409 or 502(i) of ERISA
or a material tax imposed pursuant to Sections 4975 or 4976
of the Code, and (viii) to the best knowledge of FCB, there
are no pending, threatened or anticipated claims (other than
routine claims for benefits) by, on behalf of or against any
of the FCB Benefit Plans or any trusts related thereto which
are, in the reasonable judgment of FCB, likely, either
individually or in the aggregate, to have a Material Adverse
Effect on FCB.
4.12 SEC REPORTS. FCB and each of the FCB Subsidiaries
has made available to OSB an accurate and complete copy of each
(a) final registration statement, prospectus, report, schedule
and definitive proxy statement filed since March 31, 1993 by FCB
with the SEC pursuant to the Securities Act or the Exchange Act
(collectively, the "FCB Reports"), and (b) communication mailed
by FCB to its shareholders since March 31, 1993. None of the FCB
Reports or such communications to shareholders, as of their
respective dates, contained any untrue statement of a material
fact or omitted to state any material fact required to be stated
therein or necessary in order to make the statements therein, in
light of the circumstances in which they were made, not
misleading. Since March 31, 1993, FCB has timely filed all FCB
Reports and other documents required to be filed by it under the
Securities Act and the Exchange Act, and, as of their respective
dates, all FCB Reports complied in all material respects with the
published rules and regulations of the SEC with respect thereto.
4.13 COMPLIANCE WITH APPLICABLE LAW. FCB and each of
the FCB Subsidiaries hold all licenses, franchises, permits and
authorizations necessary for the lawful conduct of their
respective businesses under and pursuant to all, and have
complied with and are not in default under any, applicable laws,
statutes, orders, rules, regulations, policies and/or guidelines
of any Governmental Entity relating to FCB or any of the FCB
Subsidiaries, except where the failure to hold such license,
franchise, permit or authorization or such noncompliance or
default would not, individually or in the aggregate, have a
Material Adverse Effect on FCB.
<PAGE> 43
4.14 CERTAIN CONTRACTS.
(a) Except as set forth in Schedule 4.14(a) of
the FCB Disclosure Schedules, neither FCB nor any of the FCB
Subsidiaries is a party to or bound by:
(i) any contract, arrangement, commitment or
understanding (whether written or oral) with respect to
the employment or compensation of any directors,
officers or employees;
(ii) any contract, arrangement, commitment or
understanding (whether written or oral) which, upon the
consummation of the transactions contemplated by this
Agreement or the Plan of Merger will (either alone or
upon the occurrence of any additional acts or events)
result in any payment (including, without limitation,
severance, unemployment compensation, golden parachute
or otherwise) becoming due from OSB, FCB, the Surviving
Corporation, or any of their respective Subsidiaries to
any officer, director or employee thereof or to the
trustee under any "rabbi trust" or similar arrangement;
(iii) any contract, arrangement,
commitment or understanding (whether written or oral)
which materially restricts the conduct of any line of
business by FCB; or
(iv) any contract, arrangement, commitment or
understanding (whether written or oral), including any
stock option plan, stock appreciation rights plan,
restricted stock plan or stock purchase plan, any of
the benefits of which will be increased or be required
to be paid, or the vesting of the benefits of which
will be accelerated, by the occurrence of any of the
transactions contemplated by this Agreement or the Plan
of Merger, or the value of any of the benefits of which
will be calculated on the basis of any of the
transactions contemplated by this Agreement or the Plan
of Merger.
FCB has previously made available to OSB true and correct
copies of all employment and deferred compensation
arrangements which are in writing and to which FCB or an FCB
Subsidiary is a party. Each contract, arrangement,
commitment or understanding of the type described in this
Section 4.14(a), is referred to herein as an "FCB Contract,"
and neither FCB nor any of the FCB Subsidiaries knows of, or
has received notice of, any violation of any FCB Contract by
any of the other parties thereto, which, individually or in
the aggregate, would have a Material Adverse Effect on FCB.
<PAGE> 44
(b) (i) each FCB Contract is valid and binding on
FCB or the applicable FCB Subsidiary, as the case may be,
and is in full force and effect, (ii) FCB and each of the
FCB Subsidiaries has performed all obligations required to
be performed by it to date under each FCB Contract to which
it is a party, except where such noncompliance, individually
or in the aggregate, would not have a Material Adverse
Effect on FCB, and (iii) no event or condition exists which
constitutes or, after notice or lapse of time or both, would
constitute, a default on the part of FCB or any of the FCB
Subsidiaries under any such FCB Contract, except where any
such default, individually or in the aggregate, would not
have a Material Adverse Effect on FCB.
4.15 AGREEMENTS WITH REGULATORY AGENCIES. Neither FCB
nor any of the FCB Subsidiaries is subject to any cease-and-
desist or other order issued by, or is a party to any written
agreement, consent agreement or memorandum of understanding with,
or is a party to any commitment letter or similar undertaking to,
or is subject to any order or directive by, or has been since
March 31, 1993, a recipient of any supervisory letter from, or
since March 31, 1993, has adopted any board resolutions at the
request of any Regulatory Agency or other Governmental Entity
that currently restricts the conduct of its business or that
relates to its capital adequacy, compliance with laws, its credit
policies, its management or its business (each, whether or not
set forth in the FCB Disclosure Schedules, a "FCB Regulatory
Agreement") nor has FCB or any of the FCB Subsidiaries been
advised since March 31, 1993 by any Regulatory Agency or other
Governmental Entity that it is considering issuing or requesting
any such FCB Regulatory Agreement.
4.16 OTHER ACTIVITIES OF FCB AND ITS FCB SUBSIDIARIES.
Neither FCB nor any of the FCB Subsidiaries that is neither a
savings association, a savings association operating subsidiary
or a savings association service corporation directly or
indirectly engages in any activity prohibited by the OTS.
Without limiting the generality of the foregoing, no equity
investment of FCB or any FCB Subsidiary that is neither a savings
association, a savings association operating subsidiary nor a
savings association service corporation is prohibited by the OTS.
4.17 INVESTMENT SECURITIES. Each of FCB and the FCB
Subsidiaries has good and marketable title to all securities held
by it (except securities sold under repurchase agreements or held
in any fiduciary or agency capacity), free and clear of any Lien,
except to the extent such securities are pledged in the ordinary
course of business consistent with prudent banking practices to
secure obligations of FCB or any of the FCB Subsidiaries. Such
securities are valued on the books of FCB and the FCB
Subsidiaries in accordance with GAAP.
<PAGE> 45
4.18 UNDISCLOSED LIABILITIES. Except for those
liabilities that are fully reflected or reserved against on the
consolidated statement of financial condition of FCB included in
the FCB First Quarter 10-Q, liabilities disclosed in Schedule
4.18 of the FCB Disclosure Schedules, and liabilities incurred in
the ordinary course of business consistent with past practice
since June 30, 1996, neither FCB nor any of the FCB Subsidiaries
has incurred any liability of any nature whatsoever (whether
absolute, accrued, contingent or otherwise and whether due or to
become due) that, either alone or when combined with all similar
liabilities, has had, or could reasonably be expected to have, a
Material Adverse Effect on FCB.
4.19 INSURANCE. Schedule 4.19 of the FCB Disclosure
Schedules describes all policies of insurance in which FCB or any
of the FCB Subsidiaries is named as an insured party or which
otherwise relate to or cover any assets or properties of FCB or
any of the FCB Subsidiaries. Each of such policies is in full
force and effect, and the coverage provided under such properties
complies with the requirements of any contracts binding on FCB or
any of the FCB Subsidiaries relating to such assets or
properties. Except as set forth in Schedule 4.19 of the FCB
Disclosure Schedules, neither FCB nor any of the FCB Subsidiaries
has received any notice of cancellation or termination with
respect to any material insurance policy of FCB or any of the FCB
Subsidiaries.
4.20 LOAN LOSS RESERVES. The reserve for possible loan
losses shown on the June 30, 1996 call report filed for FCB Bank
is adequate in all material respects under the requirements of
GAAP to provide for possible losses, net of recoveries relating
to loans previously charged off, on loans outstanding (including
accrued interest receivable) as of June 30, 1996. The aggregate
loan balances of FCB Bank at such date in excess of such reserves
of each of FCB Bank are, to the best knowledge and belief of FCB,
collectible in accordance with their terms.
4.21 ENVIRONMENTAL LIABILITY. Except as set forth in
Schedule 4.21, there are no legal, administrative, arbitration or
other proceedings, claims, actions, causes of action, private
environmental investigations or remediation activities or
governmental investigations of any nature pending or, to the best
of FCB's knowledge, threatened against FCB seeking to impose, or
that could reasonably result in the imposition, on FCB of any
liability or obligation arising under common law or under any
local, state, federal or foreign environmental statute,
regulation or ordinance including, without limitation, CERCLA
which, insofar as reasonably can be foreseen, could have a
Material Adverse Effect on FCB. Except as set forth in Schedule
4.21, to the best of FCB's knowledge, there is no reasonable
basis for any such proceeding, claim, action or governmental
investigation that would impose any such liability or obligation
which, insofar as reasonably can be foreseen, could have a
<PAGE> 46
Material Adverse Effect on FCB. FCB is not subject to any
agreement, order, judgment, decree, letter or memorandum by or
with any court, governmental authority, regulatory agency or
third party imposing any such liability or obligation which,
insofar as reasonably can be foreseen, could have a Material
Adverse Effect on FCB.
4.22 APPROVAL DELAYS. FCB knows of no reason why any
of the Requisite Regulatory Approvals (as defined in Section
7.1(b)) should be denied or unduly delayed.
4.23 VOTE REQUIRED. The approval by the holders of a
majority of the votes entitled to be cast by all holders of FCB
Common Stock to approve the Merger (including the issuance of
shares of FCB Common Stock in connection therewith) is the only
vote of the holders of any class or series of the capital stock
of FCB required for any of the transactions contemplated by this
Agreement, the Plan of Merger and the Option Agreements;
PROVIDED, HOWEVER, that the approval of shareholders of FCB may
be required for the repurchase of shares of FCB Common Stock
pursuant to Section 8 of the FCB Stock Option Agreement under
circumstances where Section 180.1134 of the WBCL would be
applicable.
4.24 APPLICABILITY OF CERTAIN PROVISIONS OF WISCONSIN
LAW, ETC. Assuming the representations and warranties of OSB
made in Section 3.25 are correct, none of the "control share
voting" provisions of Section 180.1150 of the WBCL, the "business
combination" provisions of Sections 180.1140 to 180.1144 of the
WBCL, the "fair price" provisions of Section 180.1130 to 180.1133
of the WBCL, or any other takeover related provisions of the WBCL
(or, to the knowledge of FCB, any other similar state statute) or
the Articles of Incorporation or By-Laws of FCB, are applicable
to the transactions contemplated by this Agreement and the Plan
of Merger, including the granting or exercise of the FCB Stock
Option Agreement, except for the limitations set forth in
subparagraph B(4) of Article II of the Articles of Incorporation
of FCB.
4.25 OWNERSHIP OF OSB COMMON STOCK. Except as set
forth in Schedule 4.25 of the FCB Disclosure Schedules and except
pursuant to the terms of the OSB Stock Option Agreement, FCB does
not "beneficially own" (as such term is defined for purposes of
Section 13(d) of the Exchange Act) any shares of OSB Common
Stock.
ARTICLE V
COVENANTS RELATING TO CONDUCT OF BUSINESS
5.1 CONDUCT OF BUSINESSES PRIOR TO THE EFFECTIVE TIME.
During the period from the date of this Agreement to the
Effective Time, except as expressly contemplated or permitted by
this Agreement and the Plan of Merger (including the OSB
<PAGE> 47
Disclosure Schedules and the FCB Disclosure Schedules), each of
FCB and OSB shall, and shall cause the FCB Subsidiaries and the
OSB Subsidiaries, respectively, to (a) conduct its business in
good faith in the usual, regular and ordinary course consistent
with past practice, (b) use reasonable efforts to maintain and
preserve intact its business organization, employees and
advantageous business relationships and retain the services of
its key officers and key employees, and (c) take no action which
would adversely affect or delay the ability of either FCB or OSB
to obtain any necessary approvals of any Regulatory Agency or
other governmental authority required for the transactions
contemplated hereby or to perform its covenants and agreements
under this Agreement, the Plan of Merger or the Option
Agreements.
5.2 FORBEARANCES. During the period from the date of
this Agreement to the Effective Time, except as set forth in the
OSB Disclosure Schedules or the FCB Disclosure Schedules, as the
case may be, and, except as expressly contemplated or permitted
by this Agreement, the Plan of Merger or the Option Agreements,
neither FCB nor OSB shall, nor shall FCB or OSB permit the FCB
Subsidiaries or OSB Subsidiaries, respectively to, without the
prior written consent of the other:
(a) other than in the ordinary course of business
consistent with past practice, (i) incur any indebtedness
for borrowed money (other than pursuant to existing lines of
credit or short-term indebtedness incurred in the ordinary
course of business consistent with past practice,
indebtedness of OSB to any of the OSB Subsidiaries or of any
of the OSB Subsidiaries to OSB, or indebtedness of FCB to
any of the FCB Subsidiaries or of any of the FCB
Subsidiaries to FCB, it being understood and agreed that
incurrence of indebtedness in the ordinary course of
business shall include, without limitation, the creation of
deposit liabilities, purchases of Federal funds, sales of
certificates of deposit and entering into repurchase
agreements), (ii) assume, guarantee, endorse or otherwise as
an accommodation become responsible for the obligations of
any other individual, corporation or other entity; or (iii)
make any loan or advance;
(b) (i) adjust, split, combine or reclassify any
capital stock, (ii) make, declare or pay any dividend or
make any other distribution on, any shares of its capital
stock or any securities or obligations convertible into or
exchangeable for any shares of its capital stock (except (A)
in the case of FCB, for regular quarterly cash dividends at
a rate not in excess of $0.18 per share of FCB Common Stock,
and (B) in the case of OSB, for regular quarterly cash
dividends at a rate not in excess of $0.16 per share of OSB
Common Stock); (iii) directly or indirectly redeem, purchase
or otherwise acquire any shares of capital stock or any
<PAGE> 48
securities or obligations convertible into or exchangeable
for any shares of its capital stock (except (A) in the case
of FCB, repurchases of FCB Common Stock in the open market
or in privately negotiated transactions, provided that
written notice of any such repurchase is given to OSB as
soon as is practicable thereafter, and (B) in the case of
OSB, repurchases of OSB Common Stock in the open market or
in privately negotiated transactions, provided that written
notice of any such repurchase is given to FCB as soon as
practicable thereafter); (iv) grant any stock appreciation
rights or grant any individual, corporation or other entity
any right to acquire any shares of its capital stock, or
(iv) issue any additional shares of capital stock (except
pursuant to (A) the exercise of stock options outstanding as
of the date of this Agreement, or (B) the Option
Agreements);
(c) sell, transfer, mortgage, encumber or
otherwise dispose of any of its properties or assets to any
individual, corporation or other entity other than a
Subsidiary, or cancel, release or assign any indebtedness to
any such person or any claims held by any such person,
except in the ordinary course of business consistent with
past practice or pursuant to contracts or agreements in
force at the date of this Agreement;
(d) except for transactions in the ordinary
course of business consistent with past practice or pursuant
to contracts or agreements in force at the date of this
Agreement, make any material investment either by purchase
of stock or securities, contributions to capital, property
transfers, or purchase of any property or assets of any
other individual, corporation or other entity other than a
Subsidiary thereof or any existing joint venture to which
OSB or FCB is a party;
(e) except for transactions in the ordinary
course of business consistent with past practice, enter into
or terminate any material contract or agreement, or make any
change in any of its material leases or contracts, other
than renewals of contracts and leases without material
adverse changes of terms;
(f) other than in the ordinary course of business
consistent with past practice, increase in any manner the
compensation or fringe benefits of any of its employees (it
being understood and agreed that an increase in any manner
the compensation of any employee in the ordinary course of
business consistent with past practice shall include,
without limitation, an increase in Mr. Rothenbach's base
salary to an amount not to exceed $125,000 annually), or pay
any pension or retirement allowance not required by any
existing plan or agreement to any such employees or become a
<PAGE> 49
party to, amend or commit itself to any pension, retirement,
profit-sharing or welfare benefit plan or agreement or
employment agreement with or for the benefit of any
employee; PROVIDED, HOWEVER, that (i) any bonus paid any
officer of FCB or the FCB Subsidiaries shall not exceed 115%
of such bonus paid to such individual for the immediately
preceding fiscal year and (ii) any bonus paid by OSB or the
OSB Subsidiaries to (a) James J. Rothenbach shall not exceed
30% of his 1996 base salary, (b) any Vice President of OSB
or the OSB Subsidiaries shall not exceed 15% of each
individual's 1996 base salary, and (c) all other employees
of OSB or the OSB Subsidiaries shall not exceed $30,000 in
the aggregate for any fiscal year;
(g) grant, amend or modify in any material
respect any stock option, stock awards or other stock based
compensation, except that OSB and FCB may modify their
respective stock options and OSB may modify stock awards
previously granted under the OSB MRP which are outstanding
as of the date of this Agreement in each case solely to
provide full vesting conditioned upon and effective as of
the Closing Date.
(h) pay, discharge or satisfy any material
claims, liabilities or obligations (whether absolute,
accrued, asserted or unasserted, contingent or otherwise),
other than the payment, discharge or satisfaction, in the
ordinary course of business consistent with past practice
(which includes the payment of final and unappealable
judgments) or in accordance with their terms, of liabilities
reflected or reserved against in, or contemplated by, the
most recent consolidated financial statements (or the notes
thereto) of such party included in such party's reports
filed with the SEC, or incurred in the ordinary course of
business consistent with past practice;
(i) take any action that would prevent or impede
the Merger from qualifying as a reorganization within the
meaning of Section 368 of the Code; PROVIDED, HOWEVER, that
nothing contained herein shall limit the ability of OSB or
FCB to exercise its rights under the OSB Option Agreement or
the FCB Option Agreement, as the case may be;
(j) amend its articles of incorporation or its
bylaws;
(k) other than in prior consultation with the
other party to this Agreement, restructure or materially
change its investment securities portfolio or its gap
position, through purchases, sales, or otherwise, or the
manner in which the portfolio is classified or reported;
<PAGE> 50
(l) 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 at any time
prior to the Effective Time, or in any of the conditions to
the Merger set forth in Article VII not being satisfied or
in a violation of any provision of this Agreement, the Plan
of Merger or the Option Agreements, except, in every case,
as may be required by applicable law; or
(m) agree to, or make any commitment to, take any
of the actions prohibited by this Section 5.2.
ARTICLE VI
ADDITIONAL AGREEMENTS
6.1 REGULATORY MATTERS; COOPERATION WITH RESPECT TO
FILING.
(a) (i) FCB shall promptly prepare and file with
the SEC the Joint Proxy Statement in preliminary form; (ii)
FCB shall promptly prepare and file an application with the
OTS, for approval to consummate the transactions
contemplated by this Agreement, the Plan of Merger and, to
the extent required, the Option Agreements. Each of FCB and
OSB shall use all reasonable efforts to have the S-4, in
which the Joint Proxy Statement will be included as a
prospectus, declared effective under the Securities Act as
promptly as practicable after such filing and to mail or
deliver the Joint Proxy Statement to their respective
shareholders. FCB shall also use all reasonable efforts to
obtain all necessary state securities law or "Blue Sky"
permits and approvals required to carry out the transactions
contemplated by this Agreement and the Plan of Merger, and
OSB shall furnish all information concerning OSB and the
holders of the OSB Common Stock as may be reasonably
requested by FCB in connection with any such action.
(b) The parties hereto shall cooperate with each
other and shall each use reasonable efforts to promptly
prepare and file all necessary documentation, to effect all
applications, notices, petitions and filings, to obtain as
promptly as practicable all permits, consents, approvals and
authorizations of all third parties and Governmental
Entities which are necessary or advisable to consummate the
transactions contemplated by this Agreement and the Plan of
Merger (including, without limitation, the Merger), and to
comply with the terms and conditions of all such permits,
consents, approvals and authorizations of all such
Governmental Entities. FCB and OSB shall have the right to
review in advance, and, to the extent practicable, each will
consult the other on, in each case subject to applicable
laws relating to the exchange of information, all the
<PAGE> 51
information relating to FCB or OSB, as the case may be, and
the FCB Subsidiaries and OSB Subsidiaries, respectively,
which appears in any filing made with, or written materials
submitted to, any third party or any Governmental Entity in
connection with the transactions contemplated by this
Agreement and the Plan of Merger. In exercising the
foregoing right, each of the parties hereto shall act
reasonably and as promptly as practicable. The parties
hereto agree that they will consult with each other with
respect to the obtaining of all permits, consents, approvals
and authorizations of all third parties and Governmental
Entities necessary or advisable to consummate the
transactions contemplated by this Agreement and the Plan of
Merger, and each party will keep the other apprised of the
status of matters relating to completion of the transactions
contemplated herein.
(c) FCB and OSB shall, upon request, furnish each
other with all information concerning themselves, and the
FCB Subsidiaries and the OSB Subsidiaries, respectively,
directors, officers and shareholders and such other matters
as may be reasonably necessary or advisable in connection
with the Joint Proxy Statement, the S-4 or any other
statement, filing, notice or application made by or on
behalf of FCB or OSB or the FCB Subsidiaries and OSB
Subsidiaries, as the case may be, to any Governmental Entity
in connection with the Merger and the other transactions
contemplated by this Agreement and the Plan of Merger. FCB
covenants and agrees that none of the information which is
furnished by FCB for inclusion, or which is included, in the
S-4, the Joint Proxy Statement or any other statement,
filing, notice or application made by or on behalf of FCB or
OSB or the FCB Subsidiaries or the OSB Subsidiaries, as the
case may be, to any Governmental Entity in connection with
the Merger and the other transactions contemplated by this
Agreement and the Plan of Merger will, at the respective
times such documents are filed and, in the case of the S-4,
when it becomes effective and, with respect to the Joint
Proxy Statement, when mailed or at the time of the meetings
of the shareholders of FCB and OSB, be false or misleading
with respect to any material fact or shall omit to state any
material fact necessary in order to make the statements
therein, in light of the circumstances in which they were
made, not misleading. OSB covenants and agrees that none of
the information which is furnished by OSB for inclusion, or
which is included, in the S-4, the Joint Proxy Statement or
any other statement, filing, notice or application made by
or on behalf of FCB or OSB or the FCB Subsidiaries or the
OSB Subsidiaries, as the case may be, to any Governmental
Entity in connection with the Merger and the other
transactions contemplated by this Agreement and the Plan of
Merger will, at the respective times such documents are
filed and, in the case of the S-4, when it becomes effective
<PAGE> 52
and, with respective to the Joint Proxy Statement, when
mailed or at the time of the meetings of the shareholders of
FCB and OSB, be false or misleading with respect to any
material fact or shall omit to state any material fact
necessary in order to make the statements therein, in light
of the circumstances in which they were made, not
misleading. Notwithstanding the foregoing, FCB shall have
no responsibility for the truth or accuracy of any
information with respect to OSB or the OSB Subsidiaries
included in the S-4, the Joint Proxy Statement, or any other
statement, filing, notice or application filed with any
Governmental Entity in connection with the Merger and the
other transactions contemplated by this Agreement and the
Plan of Merger, and OSB shall have no responsibility for the
truth or accuracy of any information with respect to FCB or
the FCB Subsidiaries included in the S-4, the Joint Proxy
Statement, or any other statement, filing, notice or
application filed with any Governmental Entity in connection
with the Merger and the other transactions contemplated by
this Agreement and the Plan of Merger.
(d) FCB and OSB shall promptly advise one another
upon receiving any communication from any Governmental
Entity whose consent or approval is required for
consummation of the transactions contemplated by this
Agreement and the Plan of Merger which causes such party to
believe that there is a reasonable likelihood that any
Requisite Regulatory Approval will not be obtained or that
the receipt of any such approval will be materially delayed.
6.2 ACCESS TO INFORMATION; DUE DILIGENCE.
(a) Upon reasonable notice and subject to
applicable laws relating to the exchange of information,
each of FCB and OSB shall, and shall cause the FCB
Subsidiaries and the OSB Subsidiaries, respectively, to,
afford to the officers, employees, accountants, counsel and
other representatives of the other party, access, during
normal business hours during the period prior to the
Effective Time, to all its properties, books, contracts,
commitments and records and, during such period, each of FCB
and OSB shall, and shall cause the FCB Subsidiaries and the
OSB Subsidiaries, respectively, to, make available to the
other party (i) a copy of each report, schedule,
registration statement and other document filed or received
by it during such period pursuant to the requirements of
federal securities laws or federal or state banking laws,
and (ii) all other information concerning its business,
properties and personnel as such party may reasonably
request. Neither FCB, OSB, the FCB Subsidiaries nor the OSB
Subsidiaries shall be required to provide access to or to
disclose information where such access or disclosure would
(A) violate or prejudice the rights of FCB's or OSB's, as
<PAGE> 53
the case may be, customers or contravene any law, rule,
regulation, order, judgment, decree, fiduciary duty or
binding agreement entered into prior to the date of this
Agreement, or (B) impair any attorney-client privilege of
the disclosing party. The parties hereto will make
appropriate substitute disclosure arrangements under
circumstances in which the restrictions of the preceding
sentence apply.
(b) Each of FCB and OSB shall hold all
information furnished by or on behalf of the other party or
the FCB Subsidiaries or the OSB Subsidiaries, as the case
may be, or their representatives pursuant to Section 6.2(a)
in confidence and shall return all documents containing any
information concerning the properties, business and assets
of each other party that may have been obtained in the
course of negotiations or examination of the affairs of each
other party either prior or subsequent to the execution of
this Agreement (other than such information as shall be in
the public domain or otherwise ascertainable from public or
outside sources) and shall destroy any information, analyses
or the like derived from such confidential information.
Each of FCB and OSB shall use such information solely for
the purpose of conducting business, legal and financial
reviews of the other party and for such other purposes as
may be related to this Agreement and the Plan of Merger.
(c) No investigation by either of the parties or
their respective representatives shall affect the
representations and warranties of the other set forth
herein. Without limitation of the foregoing, each party
shall promptly notify the other party of any information
obtained by such party during the course of any due
diligence conducted by such party or its representatives in
accordance with this Section 6.2 which is materially
inconsistent with any representation or warranty made by the
other party under this Agreement; PROVIDED, HOWEVER, that
either party's failure to provide such notice to the other
party shall not, in turn, be deemed to constitute a material
breach of such party's obligations under this Agreement and
the Plan of Merger.
6.3 SHAREHOLDERS' APPROVALS. Each of FCB and OSB
shall call a meeting of its shareholders to be held as soon as
reasonably practicable for the purpose of voting upon this
Agreement and the Plan of Merger (and, in the case of FCB, the
issuance of shares of FCB Common Stock in the Merger), and,
subject to the terms and conditions of this Agreement and the
Plan of Merger, each of FCB and OSB shall use reasonable efforts
to cause such meetings to occur on the same date and each shall
use all reasonable efforts to obtain shareholder approval of this
Agreement, the Plan of Merger and the Merger.
<PAGE> 54
6.4 LEGAL CONDITIONS TO MERGER. Each of FCB and OSB
shall, and shall cause the FCB Subsidiaries and the OSB
Subsidiaries, respectively, to use reasonable efforts (a) to
take, or cause to be taken, all actions necessary, proper or
advisable to comply promptly with all legal requirements which
may be imposed on such party with respect to the Merger and,
subject to the conditions set forth in Article VII hereof, to
consummate the transactions contemplated by this Agreement and
the Plan of Merger and (b) to obtain (and to cooperate with the
other party to obtain) any consent, authorization, order or
approval of, or any exemption by, any Governmental Entity and any
other third party which is required to be obtained by FCB, the
FCB Subsidiaries, OSB or the OSB Subsidiaries in connection with
the Merger and the other transactions contemplated by this
Agreement, the Plan of Merger and the Option Agreements.
6.5 LISTING OF SHARES. FCB shall use all reasonable
efforts to cause the shares of FCB Common Stock issuable in the
Merger to be approved for listing on The Nasdaq Stock Market.
6.6 INDEMNIFICATION; DIRECTORS' AND OFFICERS'
INSURANCE.
(a) In the event of any threatened or actual
claim, action, suit, proceeding or investigation, whether
civil, criminal or administrative, including, without
limitation, any such claim, action, suit, proceeding or
investigation in which any individual who is now, or has
been at any time prior to the date of this Agreement, or who
becomes prior to the Effective Time, a director or officer
or employee of FCB, the FCB Subsidiaries, OSB or the OSB
Subsidiaries (the "Indemnified Parties"), is, or is
threatened to be, made a party based in whole or in part on,
or arising in whole or in part out of, or pertaining to (i)
the fact that he or she is or was a director, officer or
employee of FCB, the FCB Subsidiaries, OSB or the OSB
Subsidiaries or any of their respective predecessors, or
(ii) this Agreement, the Plan of Merger or the Option
Agreements or any of the transactions contemplated hereby or
thereby, whether in any case asserted or arising before or
after the Effective Time, the parties hereto agree to
cooperate and use reasonable efforts to defend against and
respond thereto. It is understood and agreed that after the
Effective Time, the Surviving Corporation shall indemnify
and hold harmless, as and to the fullest extent permitted by
law, each such Indemnified Party against any losses, claims,
damages, liabilities, costs, expenses (including reasonable
attorney's fees and expenses in advance of the final
disposition of any claim, suit, proceeding or investigation
incurred by each Indemnified Party to the fullest extent
permitted by law upon receipt of any undertaking required by
applicable law), judgments, fines and amounts paid in
settlement in connection with any such threatened or actual
<PAGE> 55
claim, action, suit, proceeding or investigation, and in the
event of any such threatened or actual claim, action, suit,
proceeding or investigation (whether asserted or arising
before or after the Effective Time), the Indemnified Parties
may retain counsel reasonably satisfactory to them after
consultation with the Surviving Corporation; PROVIDED,
HOWEVER, that (A) the Surviving Corporation shall have the
right to assume the defense thereof and upon such assumption
the Surviving Corporation shall not be liable to any
Indemnified Party for any legal expenses of other counsel or
any other expenses subsequently incurred by any Indemnified
Party in connection with the defense thereof, except that if
the Surviving Corporation elects not to assume such defense
or counsel for the Indemnified Parties reasonably advises
the Indemnified Parties that there are issues which raise
conflicts of interest between the Surviving Corporation and
the Indemnified Parties, the Indemnified Parties may retain
counsel reasonably satisfactory to them after consultation
with the Surviving Corporation, and the Surviving
Corporation shall pay the reasonable fees and expenses of
such counsel for the Indemnified Parties, (B) the Surviving
Corporation shall be obligated pursuant to this paragraph to
pay for only one firm of counsel for all Indemnified
Parties, unless an Indemnified Party shall have reasonably
concluded, based on the advice of counsel, that there is a
material conflict of interest between the interests of such
Indemnified Party and the interests of one or more other
Indemnified Parties and that the interests of such
Indemnified Party will not be adequately represented unless
separate counsel is retained, in which case, the Surviving
Corporation shall be obligated to pay such separate counsel,
(C) the Surviving Corporation shall not be liable for any
settlement effected without its prior written consent (which
consent shall not be unreasonably withheld) and (D) the
Surviving Corporation shall have no obligation hereunder to
any Indemnified Party when and if a court of competent
jurisdiction shall ultimately determine, and such
determination shall have become final and nonappealable,
that indemnification of such Indemnified Party in the manner
contemplated hereby is prohibited by applicable law. Any
Indemnified Party wishing to claim Indemnification under
this Section 6.6, upon learning of any such claim, action,
suit, proceeding or investigation, shall notify the
Surviving Corporation thereof, provided that the failure to
so notify shall not affect the obligations of the Surviving
Corporation under this Section 6.6 except to the extent such
failure to notify materially prejudices the Surviving
Corporation. The Surviving Corporation's obligations under
this Section 6.6 shall continue in full force and effect for
a period of five years from the Effective Time (or the
period of the applicable statute of limitations, if longer);
PROVIDED, HOWEVER, that all rights to indemnification in
respect of any claim (a "Claim") asserted or made within
<PAGE> 56
such period shall continue until the final disposition of
such Claim.
(b) The Surviving Corporation shall use
reasonable efforts (i) to obtain, after the Effective Time,
directors' and officers' liability insurance coverage for
the officers and directors of the Surviving Corporation, to
the extent that the same is economically practicable, and
(ii) either (A) to cause the individuals serving as officers
and directors of FCB, the FCB Subsidiaries, OSB or the OSB
Subsidiaries immediately prior to the Effective Time to be
covered for a period of three years from the Effective Time
by the directors' and officers' liability insurance policies
maintained by the Surviving Corporation, or to (B)
substitute therefor policies of at least the same coverage
and amounts containing terms and conditions which are not
less advantageous than the policies previously maintained by
FCB and OSB, respectively, with respect to acts or omissions
occurring prior to the Effective Time which were committed
by such officers and directors in their capacity as such;
PROVIDED, HOWEVER, that in no event shall the Surviving
Corporation be required to expend per year an amount in
excess of 120% of the premium for such insurance paid by FCB
during its 1997 fiscal year (the "Insurance Amount") to
maintain or procure insurance coverage pursuant to clause
(ii) of this sentence, and provided further that if the
Surviving Corporation is unable to maintain or obtain the
insurance called for by clause (ii) of this sentence, the
Surviving Corporation shall use reasonable efforts to obtain
as much comparable insurance as available for the Insurance
Amount.
(c) In the event the Surviving Corporation or any
of its successors or assigns (i) consolidates with or merges
into any other person and shall not be the continuing or
surviving corporation or entity of such consolidation or
merger, or (ii) transfers or conveys all or substantially
all of its properties and assets to any person, then, and in
each such case, to the extent necessary, proper provision
shall be made so that the successors and assigns of the
Surviving Corporation assume the obligations set forth in
this Section 6.6.
(d) The provisions of this Section 6.6 are
intended to be for the benefit of, and shall be enforceable
by, each Indemnified Party and his or her heirs and
representatives.
6.7 ADDITIONAL AGREEMENTS. In case at any time after
the Effective Time any further action is necessary or desirable
to carry out the purposes of this Agreement, the Plan of Merger
or the Option Agreements or to vest FCB with full title to all
properties, assets, rights, approvals, immunities and franchises
<PAGE> 57
of any of the parties to the Merger, the proper officers and
directors of each party to this Agreement shall take, or cause
the proper officers and directors of the FCB Subsidiaries or OSB
Subsidiaries to take, as the case may be, all such necessary
action as may be reasonably requested by FCB.
6.8 ADVICE OF CHANGES. Between the date hereof and
the Effective Time, FCB and OSB shall promptly provide notice to
the other party of any change or event having a Material Adverse
Effect on it or which it believes would or would be reasonably
likely to cause or constitute a material breach of any of its
representations, warranties or covenants contained herein.
6.9 NO CONDUCT INCONSISTENT WITH THIS AGREEMENT.
(a) Neither FCB nor OSB shall:
(i) solicit, encourage or authorize any
individual, corporation or other entity to solicit from
any third party any inquires or proposals relating to
the disposition of its business or assets, or the
acquisition of its capital stock, or the merger of it
or any of the FCB Subsidiaries or the OSB Subsidiaries,
respectively, with any corporation or other entity
other than as provided by this Agreement except
pursuant to a written direction from a regulatory
authority; or
(ii) negotiate with or entertain any
proposals from any other person for any such
transaction wherein the business, assets or capital
stock of it or the FCB Subsidiaries or the OSB
Subsidiaries, respectively, would be acquired, directly
or indirectly, by any party other than as provided by
this Agreement, except pursuant to a written direction
from any regulatory authority or upon the receipt of an
unsolicited offer from a third party where the Board of
Directors of the party receiving such offer reasonably
believes, upon the written opinion of counsel, that its
fiduciary duties require it to enter into discussions
with such party. Each party shall promptly notify the
other of all of the relevant details relating to all
inquiries and proposals which it may receive relating
to any proposed disposition of its business or assets,
or the acquisition of its capital stock, or the merger
of it or the FCB Subsidiaries or the OSB Subsidiaries,
respectively, with any corporation or other entity
other than as provided by this Agreement and shall keep
the other party informed of the status and details of
any such inquiry or proposal, and shall give the other
party five days' advance notice of any agreement to be
entered into with, or any information to be supplied
to, any person making such inquiry or proposal; or
<PAGE> 58
(b) Nothing contained herein shall prohibit a
party from disclosing to its shareholders a position
contemplated by Rule 14e-2(a) under the Exchange Act with
respect to a tender offer for that party's common stock.
6.10 EMPLOYEE BENEFIT PLANS.
(a) At the Effective Time, the Oshkosh Savings
Bank, FSB Employee Stock Ownership Plan (the "OSB ESOP")
shall be merged with and into the FCB Financial Corp.
Employee Stock Ownership Plan (the "FCB ESOP"), with all
participants in the OSB ESOP at the time of such merger of
the OSB ESOP and the FCB ESOP to become participants in the
FCB ESOP. The shares of OSB Common Stock currently held by
the OSB ESOP which are allocated to the accounts of such
participants shall be converted into shares of FCB Common
Stock in accordance with Section 1.4 hereof. The
unallocated shares of OSB Common Stock currently held by the
OSB ESOP shall be converted into shares of FCB Common Stock
in accordance with Section 1.4 hereof, and thereafter shall
be held in the Suspense Account under the FCB ESOP and
allocated to the participants in the FCB ESOP (including,
without limitation, such employees of OSB Bank who become
employees of FCB Bank following the Effective Date)
according to the terms and provisions of the FCB ESOP. FCB
shall assume the loan between OSB and the OSB ESOP. Each
OSB Bank employee's period of employment with OSB Bank shall
be counted for all purposes under the FCB ESOP, including,
without limitation, for purposes of service credit,
eligibility and vesting. Each OSB Bank employee's
compensation attributable to employment with OSB Bank shall
be counted for all purposes under the FCB ESOP, including,
without limitation, for purposes of contribution
allocations. Each active participant in the OSB ESOP or the
FCB ESOP as of the day immediately prior to the Closing Date
who is not employed by FCB Bank as of the Closing Date or
who is terminated by FCB Bank (other than for cause) within
one year after the Closing Date shall be fully vested in
their account balance under the OSB ESOP or the FCB ESOP, as
the case may be, as of the Closing Date or the date of
termination of employment, respectively.
(b) Effective as of the Effective Time, the
Oshkosh Savings Bank, FSB 401(k) Profit Sharing Plan (the
"OSB PSP") shall be merged with and into the Fox Cities
Bank, FSB Employees Savings and Investment (the "FCB PSP"),
with all participants in the OSB PSP at the time of such
merger of the OSB PSP and the FCB PSP to become participants
in the FCB PSP. Benefits under the FCB PSP shall thereafter
be available to participants in the FCB PSP (including,
without limitation, such employees of OSB Bank who become
employees of FCB Bank after the Effective Time and are
eligible to participate in the FCB PSP) according to the
<PAGE> 59
terms and provisions of the FCB PSP. Each OSB Bank
employee's period of employment with OSB Bank shall be
counted for all purposes under the FCB PSP, including,
without limitation, for purposes of service credit,
eligibility and vesting. Each OSB Bank employee's
compensation attributable to employment with OSB Bank shall
be counted for all purposes under the FCB PSP, including,
without limitation, for purposes of contribution
allocations. Each active participant in the OSB PSP or the
FCB PSP as of the day immediately prior to the Closing Date
who is not employed by FCB Bank as of the Closing Date or
who is terminated by FCB Bank (other than for cause) within
one year after the Closing Date shall be fully vested in
their account balance under the FCB PSP or the OSB PSP, as
the case may be, as of the Closing Date or the date of
termination of employment, respectively.
(c) At the Effective Time, each OSB Bank employee
shall immediately become eligible to participate in all
employee welfare benefit plans and other fringe benefits
programs offered or maintained by the Surviving Corporation
and the Surviving Bank on the same terms and conditions that
the Surviving Corporation and the Surviving Bank may make
available to their officers and employees, including,
without limitation, any health, life, long-term disability,
short-term disability, severance, vacation or paid time off
programs (the "FCB Welfare Plans"). Each OSB Bank
employee's period of employment and compensation with OSB
Bank shall be counted for all purposes under the FCB Welfare
Plans, including, without limitation, for purposes of
service credit, eligibility and benefit accrual. Any
expenses incurred by an OSB Bank employee under the OSB
Bank's employee welfare benefit plans (such as deductibles
or co-payments), shall be counted for all purposes under the
FCB Welfare Plans. FCB Bank shall provide insurance
coverage (for which FCB or FCB Bank may act as the self-
insurer) for pre-existing medical conditions (to the extent
such condition is currently covered under the OSB Bank plan,
and such condition would be covered under FCB Bank's plan if
it were not pre-existing), subject to deductibles and/or
copayment provisions generally applicable to such coverage.
(d) Subject to applicable law, OSB and FCB
acknowledge and agree that the other shall be permitted to
take whatever action it deems reasonably necessary to
accelerate any deferred bonuses and to provide that all
account balances, benefits accrued and options or awards
previously granted under the Oshkosh Savings Bank Management
Development and Recognition Plan ("OSB MRP"), OSB Option
Plan, and FCB Option Plan shall be fully vested and
nonforfeitable as of the Closing Date.
<PAGE> 60
(e) At the Effective Time, FCB shall assume all
of the obligations under the OSB MRP and OSB Option Plan,
and all shares of OSB Common Stock owned by the OSB MRP,
which have not been awarded, shall be canceled at or prior
to the Effective Time.
6.11 SEVERANCE FOR CERTAIN EMPLOYEES. The Surviving
Corporation will provide severance payments to employees of OSB
and FCB and their respective Subsidiaries (other than employees
whose severance benefits are provided for in written employment
or severance agreements) whose employment is terminated within
twelve (12) months after the Effective Date due to job
reductions, in the amount set forth below. The severance
payments which would be provided would be computed as follows:
Non-Officer -- one (1) week for each full year of
service; maximum twelve (12) weeks and minimum three
(3) weeks current salary; and
Officer -- (as set forth in Schedule 6.11) two (2)
weeks for each full year of service; maximum 26 weeks
and minimum six (6) weeks current salary.
In computing such severance payments for each
regular part-time employee, such employee's per week
compensation shall be based on 1/52 of the actual number of
hours worked by such employee in 1996.
6.12 DIVIDENDS. After the date of this Agreement, each
of FCB and OSB shall coordinate with the other the declaration of
any dividends in respect of FCB Common Stock and OSB Common Stock
and the record dates and payment dates relating thereto, it being
the intention of the parties hereto that holders of FCB Common
Stock or OSB Common Stock shall not receive two dividends, or
fail to receive one dividend, for any quarter with respect to
their shares of FCB Common Stock and/or OSB Common Stock and any
shares of common stock of the Surviving Corporation any holder of
OSB Common Stock receives in exchange therefor in the Merger.
Furthermore, after the Closing Date, the Board of Directors of
the Surviving Corporation intends to declare and pay regular
quarterly cash dividends at least equal to the rate of $0.18 per
share of the Surviving Corporation common stock, subject to
applicable laws and the business judgment of the Board of
Directors.
6.13 POST-CLOSING STOCK OPTIONS. It is the intention
of the parties hereto that the Surviving Corporation shall,
within 30 days after the Closing Date, cause non-tax-qualified
stock options (exercisable for shares of the Surviving
Corporation's common stock) to be granted to the following
executive officers of the Surviving Corporation in the following
amounts: Donald D. Parker, 10,000; James J. Rothenbach, 20,000;
Phillip J. Schoofs, 7,500; Harold L. Hermansen, 6,000; and
<PAGE> 61
Theodore W. Hoff, 6,000. The stock options provided for in this
Section 6.13 shall be granted by the personnel committee of the
Surviving Corporation under the terms of FCB's 1993 Stock Option
and Incentive Plan.
6.14 SUBSIDIARY BANK MERGER. FCB and OSB agree to
cooperate and to take such steps as may be necessary to obtain
all requisite regulatory, corporate and other approvals for the
Bank Merger, subject to consummation of the Merger, to be
effective concurrently with the Merger or as soon as practicable
thereafter. The Surviving Bank shall be FCB Bank, and shall be
known as "Fox Cities Bank, FSB." In furtherance of such
agreement, each of FCB and OSB agrees:
(a) to cause the board of directors of FCB Bank
and OSB Bank, respectively, to approve the Bank Merger and
to submit it to the sole stockholder of each bank for its
approval;
(b) to vote the shares of stock of FCB Bank and
OSB Bank owned by them in favor of the Bank Merger; and
(c) to take, or cause to be taken, all steps
necessary to consummate the Bank Merger concurrently with or
as soon as is practicable after consummation of the Merger.
The Bank Merger shall be accomplished pursuant to a merger
agreement containing such terms and conditions as are ordinary
and customary for affiliated bank merger transactions of such
type. Immediately after the Effective Time, the officers of the
Surviving Corporation shall take, or cause to be taken, whatever
additional steps may be necessary to effectuate the Bank Merger.
The directors and officers of the Surviving Bank shall be as set
forth in the list attached as Exhibit E.
6.15 RULE 145 AFFILIATES. Within 30 days before the
Closing Date, OSB shall identify in a letter to FCB all persons
who are, and to OSB's knowledge who will be at the Closing Date,
"affiliates" of OSB as such term is used in Rule 145 under the
Securities Act. OSB shall use all reasonable efforts to cause
its affiliates (including any person who may be deemed to have
become an affiliate after the date of the letter referred to in
the prior sentence) to deliver to FCB on or prior to the Closing
Date a written agreement substantially in the form attached
hereto as Exhibit F.
6.16 DISCLOSURE SCHEDULES. On the date hereof,
(a) FCB has delivered to OSB the FCB Disclosure
Schedules, accompanied by a certificate signed by the Chief
Financial officer of FCB stating the FCB Disclosure
Schedules are being delivered pursuant to this Section 6.16.
<PAGE> 62
(b) OSB has delivered to FCB the OSB Disclosure
Schedules, accompanied by a certificate signed by the Chief
Financial Officer of OSB stating the OSB Disclosure
Schedules are being delivered pursuant to this Section 6.16.
6.17 FILING AND OTHER FEES. All filing and other fees
paid to the SEC, the OTS or any State Regulatory Agency in
connection with the Merger, the Bank Merger and the transactions
contemplated by this Agreement and the costs and expenses of
printing and mailing the Joint Proxy Statement shall be borne
equally by FCB and OSB.
ARTICLE VII
CONDITIONS PRECEDENT
7.1 CONDITIONS TO EACH PARTY'S OBLIGATION TO EFFECT
THE MERGER. The respective obligation of each party to effect
the Merger shall be subject to the satisfaction at or prior to
the Effective Time of the following conditions:
(a) SHAREHOLDER APPROVAL. This Agreement, the
Plan of Merger and the transactions contemplated hereby and
thereby shall have been approved and adopted by the
respective requisite affirmative votes of the holders of OSB
Common Stock and FCB Common Stock entitled to vote thereon.
(b) OTHER APPROVALS. All regulatory approvals
required to consummate the transactions contemplated hereby
shall have been obtained, on terms and conditions reasonably
satisfactory to each of OSB and FCB, and shall remain in
full force and effect and all statutory waiting periods in
respect thereof shall have expired (all such approvals and
the expiration of all such waiting periods being referred to
herein as the "Requisite Regulatory Approvals").
(c) REGISTRATION STATEMENTS. The S-4 shall have
become effective under the Securities Act and no stop order
suspending the effectiveness of the S-4 shall have been
issued and no proceedings for that purpose shall have been
initiated or, to the knowledge of FCB or OSB, threatened by
the SEC.
(d) NO INJUNCTIONS OR RESTRAINTS; ILLEGALITY. No
order, injunction or decree issued by any court or agency of
competent jurisdiction or other legal restraint or
prohibition (an "Injunction") preventing the consummation of
the Merger or any of the other transactions contemplated by
this Agreement or the Plan of Merger shall be in effect. No
statute, rule, regulation, order, injunction or decree shall
have been enacted, entered, promulgated or enforced by any
Governmental Entity which prohibits, materially restricts or
makes illegal consummation of the Merger.
<PAGE> 63
(e) FEDERAL TAX OPINION. OSB and FCB shall each
have received an opinion of their respective counsel, in
form and substance reasonably satisfactory to each, dated as
of the Effective Time, substantially to the effect that the
Merger will constitute a tax free reorganization under
Section 368(a)(1)(A) of the Internal Revenue Code and
related sections of the Code.
(f) POST-CLOSING EMPLOYMENT AGREEMENTS. Donald
D. Parker, Phillip J. Schoofs and Harold L. Hermansen shall
each have canceled (without the payment of any benefits
thereunder) their existing severance agreement with FCB and
entered into new employment agreements with the Surviving
Corporation and the Surviving Bank in the form attached
hereto as Exhibits G, H and I, respectively. James J.
Rothenbach and Theodore W. Hoff shall each have canceled
(without the payment of any benefits thereunder) their
existing employment and severance agreement, respectively,
with OSB and entered into new employment agreements with the
Surviving Corporation and the Surviving Bank in the form
attached hereto as Exhibits J, and K, respectively.
7.2 CONDITIONS TO OBLIGATIONS OF OSB. The obligation
of OSB to effect the Merger is also subject to the satisfaction,
or waiver by OSB, at or prior to the Effective Time of the
following conditions:
(a) REPRESENTATIONS AND WARRANTIES. The
representations and warranties of FCB set forth in this
Agreement shall be true and correct (i) on and as of the
date hereof and (ii) on and as of the Closing Date with the
same effect as though such representations and warranties
had been made on and as of the Closing Date (except for
representations and warranties that expressly speak only as
of a specific date or time other than the date hereof or the
Closing Date which need only be true and correct as of such
date or time) except in each of cases (i) and (ii) for such
failures of representations or warranties to be true and
correct (without regard to any materiality qualifications
contained therein) which, individually or in the aggregate
do not, and insofar as reasonably can be foreseen, would
not, result in an FCB Material Adverse Effect. OSB shall
have received a certificate signed on behalf of FCB by the
Chief Executive Officer and Chief Financial Officer of FCB
to the foregoing effect.
(b) PERFORMANCE OF OBLIGATIONS OF FCB. FCB shall
have performed in all material respects all obligations
required to be performed by it under this Agreement, the
Plan of Merger and the Option Agreements at or prior to the
Closing Date, and OSB shall have received a certificate
signed on behalf of FCB by the Chief Executive Officer and
Chief Financial Officer of FCB to such effect.
<PAGE> 64
(c) NO MATERIAL ADVERSE CHANGE. Since the date
of this Agreement, (i) no event shall have occurred which
has had a Material Adverse Effect on FCB, and (ii) no
condition (other than general economic or competitive
conditions generally affecting savings and loan holding
companies and savings associations of a size or in locations
comparable to those of FCB or the FCB Subsidiaries), event,
circumstances, fact or other occurrence shall have occurred
that may reasonably be expected to have or result in such a
Material Adverse Effect on FCB.
(d) OPINION OF COUNSEL TO FCB. OSB shall have
received from Foley & Lardner, counsel to FCB, an opinion,
dated the Closing Date, in substantially the form of Exhibit
L.
(e) COMFORT LETTERS. OSB shall have received
from Wipfli Ullrich Bertelson LLP "comfort letters" dated
the date of mailing of the Joint Proxy Statement and the
Closing Date, covering matters customary to transactions
such as the Merger and in form and substance reasonably
satisfactory to OSB.
(f) FAIRNESS OPINION. OSB shall have received
from Edelman & Co., Ltd., a fairness opinion, dated the date
of mailing of the Joint Proxy Statement and in form and
substance reasonably satisfactory to OSB, to the effect that
the consideration to be received in the Merger by the
shareholders of OSB is fair, from a financial point of view,
to the shareholders of OSB.
7.3 CONDITIONS TO OBLIGATIONS OF FCB. The obligation
of FCB to effect the Merger is also subject to the satisfaction,
or waiver by FCB, at or prior to the Effective Time of the
following conditions:
(a) REPRESENTATIONS AND WARRANTIES. The
representations and warranties of OSB set forth in this
Agreement shall be true and correct (i) on and as of the
date hereof and (ii) on and as of the Closing Date with the
same effect as though such representations and warranties
had been made on and as of the Closing Date (except for
representations and warranties that expressly speak only as
of a specific date or time other than the date hereof or the
Closing Date which need only be true and correct as of such
date or time) except in each of cases (i) and (ii) for such
failures of representations or warranties to be true and
correct (without regard to any materiality qualifications
contained therein) which, individually or in the aggregate
do not, and insofar as reasonably can be foreseen, would
not, result in an OSB Material Adverse Effect. FCB shall
have received a certificate signed on behalf of OSB by the
<PAGE> 65
Chief Executive Officer and Chief Financial Officer of OSB
to the foregoing effect.
(b) PERFORMANCE OF OBLIGATIONS OF OSB. OSB shall
have performed in all material respects all obligations
required to be performed by it under this Agreement, the
Plan of Merger and the Option Agreements at or prior to the
Closing Date, and FCB shall have received a certificate
signed on behalf of OSB by the Chief Executive Officer and
Chief Financial Officer of OSB to such effect.
(c) NO MATERIAL ADVERSE CHANGE. Since the date
of this Agreement, (i) no event shall have occurred which
has had a Material Adverse Effect on OSB, and (ii) no
condition (other than general economic or competitive
conditions generally affecting savings and loan holding
companies and savings associations of a size or in locations
comparable to those of OSB or the OSB Subsidiaries), event,
circumstances, fact or other occurrence shall have occurred
that may reasonably be expected to have or result in such a
Material Adverse Effect on OSB.
(d) OPINION OF COUNSEL TO OSB. FCB shall have
received from Schiff Hardin & Waite, counsel to OSB, an
opinion, dated the Closing Date, in substantially the form
of Exhibit M.
(e) COMFORT LETTERS. FCB shall have received
from Wipfli Ullrich Bertelson LLP "comfort letters" dated
the date of mailing of the Joint Proxy Statement and the
Closing Date, covering matters customary to transactions
such as the Merger and in form and substance reasonably
satisfactory to FCB.
(f) FAIRNESS OPINION. FCB shall have received
from RP Financial, LC., a fairness opinion, dated the date
of mailing of the Joint Proxy Statement and in form and
substance reasonably satisfactory to FCB, to the effect that
the consideration received by FCB shareholders pursuant to
the Merger is fair, from a financial point of view, to the
shareholders of FCB.
(g) AFFILIATE AGREEMENTS. FCB shall have
received Affiliate Agreements, duly executed by each
affiliate of OSB, substantially in the form of Exhibit F.
<PAGE> 66
ARTICLE VIII
TERMINATION, EXPENSES AND AMENDMENT
8.1 TERMINATION. This Agreement may be terminated
prior to the Effective Time:
(a) at any time, whether before or after approval
of the matters presented in connection with the Merger by
the shareholders of FCB or OSB, by written agreement between
FCB or OSB, if the Board of Directors of each so determines;
(b) by FCB, by written notice to OSB, within
twenty (20) days of the date of this Agreement, if, based on
the information discovered in the course of its due
diligence investigation of OSB and the OSB Subsidiaries, FCB
reasonably determines in good faith that the consummation of
the transactions contemplated by this Agreement would not be
in the best interests of FCB; PROVIDED, HOWEVER, that FCB
shall have ten (10) days in addition to the initial 20-day
period to terminate this Agreement pursuant to this Section
8.1(b) if FCB determines, in good faith, based on the
information discovered in its review of "Phase I"
environmental audits of the real property owned by OSB and
the OSB Subsidiaries, that the transactions contemplated by
this Agreement would not be in the best interests of FCB;
provided that such additional 10-day period shall not begin
to run (following the initial twenty-day period) until such
time as OSB has caused such Phase I audits to be delivered
to FCB;
(c) By OSB, by written notice to FCB, within
twenty (20) days of the date of this Agreement, if, based on
the information discovered in the course of its due
diligence investigation of FCB and the FCB Subsidiaries, OSB
reasonably determines in good faith that the consummation of
the transactions contemplated by this Agreement would not be
in the best interests of OSB; PROVIDED, HOWEVER, that OSB
shall have ten (10) days in addition to the initial 20-day
period to terminate this Agreement pursuant to this Section
8.1(c) if OSB determines, in good faith, based on the
information discovered in its review of "Phase I"
environmental audits of the real property owned by FCB and
the FCB Subsidiaries, that the transactions contemplated by
this Agreement would not be in the best interests of OSB;
provided that such additional 10-day period shall not begin
to run (following the initial twenty-day period) until such
time as FCB has caused such Phase I audits to be delivered
to OSB;
(d) at any time, whether before or after approval
of the matters presented in connection with the Merger by
the shareholders of FCB or OSB, by either the Board of
Directors of FCB or the Board of Directors of OSB if (i) any
<PAGE> 67
Governmental Entity which must grant a Requisite Regulatory
Approval (A) has denied approval of the Merger and such
denial has become final and nonappealable or (B) has advised
the parties of its unwillingness to grant such a Requisite
Regulatory Approval on terms and conditions reasonably
acceptable to the parties, notwithstanding the parties'
fulfillment of their obligations to take reasonable efforts
to obtain such Requisite Regulatory Approval, or (ii) any
Governmental Entity of competent jurisdiction shall have
issued a final nonappealable order permanently enjoining or
otherwise prohibiting the consummation of the transactions
contemplated by this Agreement;
(e) by either the Board of Directors of FCB or
the Board of Directors of OSB if the Merger shall not have
been consummated on or before September 30, 1997, unless the
failure of the Closing to occur by such date shall be due to
the failure of the party seeking to terminate this Agreement
to perform or observe the covenants and agreements of such
party set forth herein;
(f) by either FCB or OSB if any approval of the
shareholders of FCB or OSB required for the consummation of
the Merger shall not have been obtained by reason of the
failure to obtain the required vote at a duly held meeting
of shareholders or at any adjournment or postponement
thereof;
(g) by OSB, upon two (2) days' prior notice to
FCB, if, as a result of a tender offer by a party other than
FCB or its affiliates or any written offer or proposal with
respect to a merger, share exchange, sale of a material
portion of its assets or other business combination (each, a
"Business Combination") by a party other than FCB or its
affiliates, the Board of Directors of OSB determines in good
faith that its fiduciary obligations under applicable law
require that such tender offer or other written offer or
proposal be accepted; PROVIDED, HOWEVER, that
(i) the Board of Directors of OSB shall have
been advised in a written opinion of outside counsel
that notwithstanding a binding commitment to consummate
an agreement of the nature of this Agreement entered
into in the proper exercise of its applicable fiduciary
duties, and notwithstanding all concessions which may
be offered by FCB in negotiations entered into pursuant
to clause (ii) below, such fiduciary duties would
require the directors to reconsider such commitment as
a result of such tender offer or other written offer or
proposal; and
(ii) prior to any such termination, OSB
shall, and shall cause its financial and legal advisors
<PAGE> 68
to, negotiate with FCB to make such adjustments in the
terms and conditions of this Agreement as would enable
OSB to proceed with the transactions contemplated
herein on such adjusted terms;
(h) by FCB, upon two (2) days' prior notice to
OSB, if, as a result of a tender offer by a party other than
OSB or its affiliates or any written offer or proposal with
respect to a Business Combination by a party other than OSB
or its affiliates, the Board of Directors of FCB determines
in good faith that its fiduciary obligations under
applicable law require that such tender offer or other
written offer or proposal be accepted; PROVIDED, HOWEVER,
that
(i) the Board of Directors of FCB shall have
been advised in a written opinion of outside counsel
that notwithstanding a binding commitment to consummate
an agreement of the nature of this Agreement entered
into in the proper exercise of its applicable fiduciary
duties, and notwithstanding all concessions which may
be offered by OSB in negotiations entered into pursuant
to clause (ii) below, such fiduciary duties would
require the directors to reconsider such commitment as
a result of such tender offer or other written offer or
proposal; and
(ii) prior to any such termination, FCB
shall, and shall cause its financial and legal advisors
to, negotiate with OSB to make such adjustments in the
terms and conditions of this Agreement as would enable
FCB to proceed with the transactions contemplated
herein on such adjusted terms;
(i) by OSB, by written notice to FCB, if
(i) there exists any breach or breaches of
the representations and warranties of FCB made herein
or in the FCB Stock Option Agreement, which breaches,
individually or in the aggregate have or, insofar as
reasonably can be foreseen, would have, a FCB Material
Adverse Effect, and such breaches shall not have been
remedied within thirty (30) days after receipt by FCB
of notice in writing from OSB, specifying the nature of
such breaches and requesting that they be remedied;
(ii) FCB shall have failed to perform and
comply with, in all material respects, its agreements
and covenants hereunder or under the FCB Stock Option
Agreement and such failure to perform or comply shall
not have been remedied within thirty (30) days after
receipt by FCB of notice in writing from OSB,
<PAGE> 69
specifying the nature of such failure and requesting
that it be remedied; or
(iii) the Board of Directors of FCB or
any committee thereof:
(A) shall withdraw or modify in any
manner adverse to OSB its approval or
recommendation of this Agreement or the Merger,
(B) shall fail to reaffirm such
approval or recommendation upon OSB's request,
(C) shall approve or recommend any
Business Combination involving FCB other than the
Merger or any tender offer or share exchange for
shares of capital stock of FCB, in each case, by
or involving a party other than OSB or any of its
affiliates or
(D) shall resolve to take any of the
actions specified in clause (A), (B) or (C); or
(j) by FCB, by written notice to OSB, if
(i) there exists any breach or breaches of
the representations and warranties of OSB made herein
or in the OSB Stock Option Agreement which breaches,
individually or in the aggregate have, or insofar as
reasonably can be foreseen, would have, an OSB Material
Adverse Effect and such breaches shall not have been
remedied within thirty (30) days after receipt by OSB
of notice in writing from FCB, specifying the nature of
such breaches and requesting that they be remedied;
(ii) OSB shall have failed to perform and
comply with, in all material respects, its agreements
and covenants hereunder or under the OSB Stock Option
Agreement and such failure to perform or comply shall
not have been remedied within thirty (30) days after
receipt by OSB of notice in writing from FCB,
specifying the nature of such failure and requesting
that it be remedied; or
(iii) the Board of Directors of OSB or
any committee thereof:
(A) shall withdraw or modify in any
manner adverse to FCB its approval or
recommendation of this Agreement or the Merger,
(B) shall fail to reaffirm such
approval or recommendation upon FCB's request,
<PAGE> 70
(C) shall approve or recommend any
Business Combination involving OSB other than the
Merger involving OSB or any tender offer or share
exchange for shares of capital stock of OSB, in
each case, by or involving a party other than FCB
or any of its affiliates or
(D) shall resolve to take any of the
actions specified in clause (A), (B) or (C).
8.2 EFFECT OF TERMINATION. Subject to Section 8.3, in
the event of termination of this Agreement by OSB or FCB pursuant
to Section 8.1 there shall be no liability on the part of either
OSB or FCB or their respective officers or directors hereunder,
except that Section 6.2(b), Section 6.17, Section 8.2 and Section
8.3 shall survive the termination.
8.3 TERMINATION FEE; EXPENSES.
(a) TERMINATION FEE UPON BREACH OR WILLFUL
BREACH. If this Agreement is terminated at such time that
this Agreement is terminable pursuant to one (but not both)
of (A) Section 8.1(i)(i) or (ii), or (B) Section 8.1(j)(i)
or (ii) then:
(i) the breaching party shall promptly (but
no later than five (5) business days after receipt of
notice from the non-breaching party) pay to the non-
breaching party in cash an amount equal to all
documented out-of-pocket expenses and fees incurred by
the non-breaching party (including, without limitation,
fees and expenses payable to all legal, accounting,
financial, public relations and other professional
advisors arising out of, in connection with or related
to the Merger or the transactions contemplated by this
Agreement) not in excess of $200,000; PROVIDED,
HOWEVER, that, if this Agreement is terminated by a
party as a result of a willful breach by other party,
the non-breaching party may pursue any remedies
available to it at law or in equity and shall, in
addition to its documented out-of-pocket expenses and
fees (which shall be paid as specified above and shall
not be limited to $200,000), be entitled to recover
such additional amounts as such non-breaching party may
be entitled to receive at law or in equity; and
(ii) if at the time of the breaching party's
willful breach of this Agreement, there shall have been
a third party tender offer for shares of, or a third
party offer or proposal with respect to a Business
Combination involving, such party, or any of its
affiliates which at the time of such termination shall
<PAGE> 71
not have been rejected by such party and its board of
directors or withdrawn by the third party,
then such breaching party (jointly and severally with its
affiliates), at the time of the termination of this
Agreement, will pay to the non-breaching party an additional
aggregate fee equal to $1 million.
(b) ALTERNATIVE TERMINATION FEE. If
(i) this Agreement
(A) is terminated by any party pursuant
to Section 8.1(g) or (h),
(B) is terminated as a result of any
party's material breach of Section 6.3,
(C) is terminated pursuant to Section
8.1(f) following a failure of shareholders of OSB
or FCB to grant the necessary approvals described
in Section 3.23 or Section 4.23, as the case may
be (a "Shareholder Disapproval"), or
(D) is terminated pursuant to one (but
not both) of Section 8.1(i)(iii) or Section
8.1(j)(iii), and
(ii) with respect to any termination referred
to in clause (i)(A), (B) or (C) above, at the time of
such termination (or prior to the meeting at which such
Shareholder Disapproval occurred), there shall have
been a third-party tender offer for shares of, or a
third-party offer or proposal with respect to a
Business Combination involving, OSB or FCB (as the case
may be, the "Target Party") or any affiliates thereof
which at the time of such termination or of the meeting
of the Target Party's shareholders, as the case may be,
shall not have been withdrawn by the third-party,
then such Target Party (jointly and severally with its
affiliates), at the time of the termination of this
Agreement, will pay to the other party in cash an aggregate
termination fee equal to $1 million, plus, in each case, the
documented out-of-pocket fees and expenses incurred by the
other party (including, without limitation, fees and
expenses payable to all legal, accounting, financial, public
relations and other professional advisors arising out of, in
connection with or related to the Merger or the transactions
contemplated by this Agreement).
(c) EXPENSES. The parties agree that the
agreements contained in this Section 8.3 are an integral
<PAGE> 72
part of the transactions contemplated by this Agreement and
constitute liquidated damages and not a penalty. If one
party fails to promptly pay to any other party any fee due
hereunder, the defaulting party shall pay the costs and
expenses (including legal fees and expenses) in connection
with any action, including the filing of any lawsuit or
other legal action, taken to collect payment, together with
interest on the amount of any unpaid fee at the publicly
announced prime rate as published in the Wall Street Journal
(Midwest Edition) from the date such fee was required to be
paid.
(d) LIMITATION ON TERMINATION FEES.
Notwithstanding anything herein to the contrary:
(i) the aggregate amount payable by OSB and
its affiliates to FCB pursuant to Section 8.3(a),
Section 8.3(b) and the terms of the OSB Stock Option
Agreement shall not exceed $1.5 million, and
(ii) the aggregate amount payable by FCB and
its affiliates to OSB pursuant to Section 8.3(a),
Section 8.3(b) and the terms of the FCB Stock Option
Agreement shall not exceed $1.5 million.
(exclusive, in each case, of reimbursement for fees and
expenses payable pursuant to this Section 8.3). For
purposes of this Section 8.3(d), the amount payable pursuant
to the terms of the Option Agreements shall be the amount
paid pursuant to Section 5 and/or Section 8(a)(i) and
Section 8(1)(ii) thereof.
8.4 AMENDMENT. Subject to compliance with applicable
law, this Agreement may be amended by the parties hereto, by
action taken or authorized by their respective Boards of
Directors, at any time before or after approval of the matters
presented in connection with the Merger by the shareholders of
FCB or OSB; PROVIDED, HOWEVER, that after any approval of the
transactions contemplated by this Agreement by the respective
shareholders of FCB or OSB, there may not be, without further
approval of such shareholders, any amendment of this Agreement
which changes the amount or the form of the consideration to be
delivered to the holders of FCB Common Stock or OSB Common Stock
hereunder other than as contemplated by this Agreement. This
Agreement may not be amended except by an instrument in writing
signed on behalf of each of the parties hereto.
8.5 EXTENSION; WAIVER. At any time prior to the
Effective Time, the parties hereto, by action taken or authorized
by their respective Board of Directors, may, to the extent
legally allowed, (a) extend the time for the performance of any
of the obligations or other acts of the other parties hereto, (b)
waive any inaccuracies in the representations and warranties
<PAGE> 73
contained herein or in any document delivered pursuant hereto,
and (c) waive compliance with any of the agreements or conditions
contained herein; PROVIDED, HOWEVER, that after any approval of
the transactions contemplated by this Agreement by the respective
shareholders of FCB or OSB, there may not be, without further
approval of such shareholders, any extension or waiver of this
Agreement or any portion thereof which reduces the amount or
changes the form of the consideration to be delivered to the
holders of FCB Common Stock or OSB Common Stock hereunder other
than as contemplated by this Agreement. Any agreement on the
part of a party hereto to any such extension or waiver shall be
valid only if set forth in a written instrument signed on behalf
of such party, but such extension or waiver or failure to insist
on strict compliance with an obligation, covenant, agreement or
condition shall not operate as a waiver of, or estoppel with
respect to, any subsequent or other failure.
ARTICLE IX
GENERAL PROVISIONS
9.1 NON-SURVIVAL OF REPRESENTATIONS, WARRANTIES AND
AGREEMENTS. None of the representations, warranties, covenants
and agreements in this Agreement or the Plan of Merger (or in any
instrument delivered pursuant to this Agreement, which shall
terminate in accordance with its terms) shall survive the
Effective Time, except for those covenants and agreements
contained herein and therein which by their terms apply in whole
or in part after the Effective Time. Without by implication
limiting the foregoing, none of the directors or officers of the
parties hereto shall have any liability for any of the
representations, warranties, covenants and agreements contained
herein.
9.2 NOTICES. All notices and other communications
hereunder shall be in writing and shall be deemed given if
delivered personally, telecopied (with confirmation), mailed by
registered or certified mail (return receipt requested) or
delivered by an express courier (with confirmation) to the
parties at the following addresses (or at such other address for
a party as shall be specified by like notice):
(a) if to OSB, to:
OSB Financial Corp.
420 South Koeller Street
Oshkosh, Wisconsin 54902
Attention: James J. Rothenbach
President and Chief
Executive Officer
Telephone: (414) 236-3680
Telecopier: (414) 236-3706
<PAGE> 74
with a copy to:
Schiff Hardin & Waite
7200 Sears Tower
Chicago, Illinois 60606
Attention: Christopher J. Zinski, Esq.
Telephone: (312) 258-5548
Telecopier: (312) 258-5600
and
(b) if to FCB, to:
FCB Financial Corp.
108 East Wisconsin Avenue
Neenah, Wisconsin 54956
Attention: Donald D. Parker
President and Chief
Executive Officer
Telephone: (414) 727-3400
Telecopier: (414) 727-3419
with a copy to:
Foley & Lardner
Firstar Center
777 East Wisconsin Avenue
Milwaukee, Wisconsin 53202-5367
Attention: Michael D. Regenfuss, Esq.
Telephone: (414) 297-5618
Telecopier: (414) 297-4900
9.3 INTERPRETATION. When a reference is made in this
Agreement to Sections, Exhibits or Schedules, such reference
shall be to a section of or exhibit or schedule to this Agreement
unless otherwise indicated. The table of contents and headings
contained in this Agreement are for reference purposes only and
shall not affect in any way the meaning or interpretation of this
Agreement. Whenever the words "include," "includes" or
"including" are used in this Agreement, they shall be deemed to
be followed by the words "without limitation." No provision of
this Agreement shall be construed to require OSB, the OSB
Subsidiaries, FCB or the FCB Subsidiaries or affiliates to take
any action which would violate any applicable law, rule or
regulation.
9.4 COUNTERPARTS. This Agreement may be executed in
counterparts, all of which shall be considered one and the same
agreement and shall become effective when counterparts have been
signed by each of the parties and delivered to the other parties,
it being understood that all parties need not sign the same
counterpart.
<PAGE> 75
9.5 ENTIRE AGREEMENT. This Agreement (including the
documents and the instruments referred to herein) constitutes the
entire agreement and supersedes all prior agreements and
understandings, both written and oral, among the parties hereto
with respect to the subject matter hereof.
9.6 GOVERNING LAW. This Agreement and the exhibits
attached hereto shall be governed and construed in accordance
with the laws of the State of Wisconsin, without regard to any
applicable conflicts of law.
9.7 SEVERABILITY. Any term or provision of this
Agreement which is invalid or unenforceable in any jurisdiction
shall, as to that jurisdiction, be ineffective to the extent of
such invalidity or unenforceability without rendering invalid or
unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of
the terms or provisions of this Agreement in any other
jurisdiction. If any provision of this Agreement is so broad as
to be unenforceable, the provision shall be interpreted to be
only so broad as is enforceable.
9.8 PUBLICITY. Except as otherwise required by
applicable law or the rules of The Nasdaq Stock Market, neither
OSB nor FCB shall, nor shall OSB or FCB permit the OSB
Subsidiaries or the FCB Subsidiaries, respectively, to issue or
cause the publication of any press release or other public
announcement with respect to, or otherwise make any public
statement concerning, the transactions contemplated by this
Agreement without the consent of the other party, which consent
shall not be unreasonably withheld.
9.9 ASSIGNMENT; THIRD PARTY BENEFICIARIES. Neither
this Agreement nor any of the rights, interests or obligations of
the parties under this Agreement shall be assigned by any of the
parties hereto (whether by operation of law or otherwise) without
the prior written consent of the other parties. Subject to the
preceding sentence, this Agreement will be binding upon, inure to
the benefit of and be enforceable by the parties and their
respective successors and assigns. A majority of the FCB
Representatives (or their successors) serving on the Board of
Directors of the Surviving Corporation shall be entitled to
enforce the provisions of Section 1.10 as such provisions relate
to the rights of FCB Representatives. A majority of the OSB
Representatives (or their successors) serving on the Board of
Directors of the Surviving Corporation shall be entitled to
enforce the provisions of Section 1.10 as such provisions relate
to the rights of OSB Representatives. Except as otherwise
specifically provided in this Section 9.9 and in Section 6.6,
this Agreement (including the documents and instruments referred
to herein) is not intended to confer upon any person other than
the parties hereto any rights or remedies hereunder.
<PAGE> 76
9.10 ENFORCEMENT. The parties agree that irreparable
damage would occur in the event that any of the provisions of
this Agreement were not performed in accordance with their
specific terms or were otherwise breached. It is accordingly
agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce
specifically the terms and provisions hereof, this being in
addition to any other remedy to which they are entitled at law or
in equity.
IN WITNESS WHEREOF, FCB and OSB have caused this
Agreement to be executed by their respective officers thereunto
duly authorized as of the date first above written.
FCB FINANCIAL CORP. OSB FINANCIAL CORP.
By:/s/ Donald D. Parker By:/s/ James J. Rothenbach
--------------------------- ---------------------------
Name: Donald D. Parker Name: James J. Rothenbach
Title: President and Title: President and
Chief Executive Officer Chief Executive Officer
<PAGE> 77
Exhibit A
STOCK OPTION AND TRIGGER PAYMENT AGREEMENT (the
"Agreement"), dated November 13, 1996, between FCB Financial
Corp., a Wisconsin corporation ("Issuer"), and OSB Financial
Corp., a Wisconsin corporation ("Grantee").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, Grantee and Issuer have entered into an
Agreement and Plan of Merger of even date herewith (the "Merger
Agreement"), which agreement has been executed by the parties
hereto immediately prior to this Stock Option and Trigger
Agreement; and
WHEREAS, as a condition to Grantee's entering into the
Merger Agreement and in consideration therefor, Issuer has agreed
to grant Grantee the Option (as hereinafter defined).
NOW, THEREFORE, in consideration of the foregoing and
the mutual covenants and agreements set forth herein and in the
Merger Agreement, the parties hereto agree as follows:
1. (a) Issuer hereby grants to Grantee an unconditional,
irrevocable option (the "Option") to purchase, subject to the
terms hereof, up to 489,463 fully paid and nonassessable (except
as otherwise provided by Section 180.0622(2)(b) of the Wisconsin
Business Corporation Law) shares (the "Option Shares") of
Issuer's Common Stock, par value $0.01 per share ("Issuer Common
Stock"), at a price of $18.875 per share (the "Option Price");
PROVIDED, HOWEVER, that in no event shall the number of shares of
Issuer Common Stock for which this Option is exercisable exceed
19.9% of the issued and outstanding shares of Issuer Common Stock
without giving effect to any shares subject to or issued pursuant
to the Option. The number of shares of Issuer Common Stock that
may be received upon the exercise of the Option and the Option
Price are subject to adjustment as herein set forth.
(b) In the event that any additional shares of Issuer
Common Stock are either (i) issued or otherwise become
outstanding after the date of this Agreement (other than pursuant
to this Agreement) or (ii) redeemed, repurchased, retired or
otherwise cease to be outstanding after the date of this
Agreement (such event a "Change in Shares Outstanding Event"),
the number of shares of Issuer Common Stock subject to the Option
shall be increased or decreased, as appropriate, so that, after
such Change in Shares Outstanding Event, such number equals 19.9%
of the number of shares of Issuer Common Stock then issued and
outstanding without giving effect to any shares subject or issued
pursuant to the Option. Nothing contained in this Section 1(b)
or elsewhere in this Agreement shall be deemed to authorize
<PAGE> 78
Issuer to issue or redeem, repurchase, or retire shares of Issuer
Common Stock or to authorize either the Issuer or the Grantee
otherwise to breach any provision of the Merger Agreement.
(c) The Option Price shall be payable, at the option
of the Grantee, as follows:
(i) in cash, or
(ii) subject to the receipt of all approvals of
any Governmental Entity required for the Issuer to acquire, and
Grantee to issue, the Grantee Shares (as defined below) from
Grantee, in shares of common stock, $0.01 par value, of Grantee
("Grantee Shares"),
in either case in accordance with Section 4 hereof.
(d) As used in this Agreement, the "Fair Market Value"
of any share shall be the average of the last sales price for
such share on The Nasdaq Stock Market during the ten trading days
prior to the fifth trading day preceding the date such Fair
Market Value is to be determined.
2. (a) The Option may be exercised by Grantee, in whole
or in part, at any time or from time to time after the Merger
Agreement becomes terminable by Grantee under circumstances which
could entitle Grantee to a termination fee (as opposed to the
reimbursement of expenses only) under Section 8.3(a) of the
Merger Agreement or Section 8.3(b) of the Merger Agreement
(regardless of whether the Merger Agreement is actually
terminated), any such event by which the Merger Agreement becomes
so terminable by Grantee being referred to herein as a " Trigger
Event."
(b) (i) Issuer shall notify Grantee promptly in
writing of the occurrence of any Trigger Event, it being
understood that the giving of such notice by Issuer shall not be
a condition to the right of Grantee to exercise the Option.
(ii) In the event Grantee wishes to exercise the
Option, Grantee shall deliver to Issuer written notice (an
"Exercise Notice") specifying the total number of Option Shares
it wishes to purchase.
(iii) Upon the giving by Grantee of Issuer of
the Exercise Notice and the tender of the applicable aggregate
Option Price, Grantee, to the extent permitted by law and
Issuer's organizational documents, and provided that the
conditions to Issuer's obligation to issue Option Shares to
Grantee hereunder set forth in Section 3 have been satisfied or
waived, shall be deemed to be the holder of record of the Option
Shares issuable upon such exercise, notwithstanding that the
stock transfer books of Issuer shall then be closed or that
<PAGE> 79
certificates representing such Option Shares shall not then be
actually delivered to Grantee.
(iv) Each closing of a purchase of Option Shares
(a "Closing") shall occur at a place, on a date, and at a time
designated by Grantee in an Exercise Notice delivered at least
two business days prior to the date of the Closing.
(c) The Option shall terminate upon the earliest to
occur of:
(i) the Effective Time of the Merger;
(ii) the termination of the Merger Agreement
pursuant to Section 8.1 thereof, other than under circumstances
which also constitute a Trigger Event under this Agreement;
(iii) 180 days following any termination of
the Merger Agreement upon or during the continuance of a Trigger
Event (or if, at the expiration of such 180-day period, the
Option cannot be exercised by reason of any applicable judgment,
decree, order, law or regulation, ten business days after such
impediment to exercise shall have been removed or shall have
become final and not subject to appeal, but in no event under
this clause (iii) later than September 30, 1997); and
(iv) payment by Issuer of the Trigger Payment set
forth in Section 5 of this Agreement to Grantee.
(d) Notwithstanding the foregoing, the Option may not
be exercised if (i) Grantee is in material breach of any of its
representations or warranties, or in material breach of any of
its covenants or agreements, contained in this Agreement or in
the Merger Agreement, or (ii) a Trigger Payment has been paid
pursuant to Section 5 of this Agreement or demand therefor has
been made and not withdrawn.
3. The obligation of Issuer to issue Option Shares to
Grantee hereunder is subject to the conditions that
(a) the Option Shares, and any Grantee Shares which
are issued in payment of the Option Price, shall have been
approved for listing on The Nasdaq Stock Market;
(b) all consents, approvals, orders or authorizations
of, or registrations, declarations or filings with, any federal,
state or local administrative agency or commission or other
federal, state or local Governmental Entity, if any, required in
connection with the issuance by Issuer and the acquisition by
Grantee of the Option Shares hereunder shall have been obtained
or made; and
<PAGE> 80
(c) no preliminary or permanent injunction or other
order by any court of competent jurisdiction prohibiting or
otherwise restraining such issuance shall be in effect.
The condition set forth in paragraph (a) above may be waived by
Issuer, in the case of Grantee Shares, and by Grantee, in the
case of Option Shares, in the sole discretion of the waiving
party.
4. At any Closing,
(a) Issuer shall deliver to Grantee or its designee a
single certificate in definitive form representing the number of
Option Shares designated by Grantee in its Exercise Notice, such
certificate to be registered in the name of Grantee and to bear
the legend set forth in Section 13; and
(b) Grantee shall deliver to issuer the aggregate
price for the Option Shares so designated and being purchased by
(i) wire transfer of immediately available funds
or certified check or bank check, or
(ii) subject to the condition in Section 1(c)(ii),
delivery of a certificate or certificates representing the number
of Grantee Shares being issued by Grantee in consideration
thereof, determined in accordance with Section 4(c).
(c) In the event that Grantee issues Grantee Shares to
Issuer in consideration of Option Shares pursuant to Section
4(b)(ii), the number of Grantee Shares to be so issued shall be
equal to the quotient obtained by dividing:
(i) the product of (x) the number of Option
Shares with respect to which the Option is being exercised and
(y) the Option Price, by
(ii) the Fair Market Value of the Grantee Shares
as of the date immediately preceding the date the Exercise Notice
is delivered to Issuer.
(d) Issuer shall pay all expenses, and any and all
federal, state and local taxes and other charges that may be
payable in connection with the preparation, issue and delivery of
stock certificates under this Section 4.
5. (a) Subject to the provisions of Section 8.3(d) of the
Merger Agreement, if a Trigger Event shall have occurred and any
regulatory approval or order required for the issuance by Issuer,
or the acquisition by Grantee, of the Option or the Option Shares
upon exercise of the Option shall not have been obtained, Grantee
shall have the right to receive, and Issuer shall pay to Grantee,
an amount (the "Trigger Payment") equal to the product of
<PAGE> 81
(i) the maximum number of Option Shares that
would have been subject to purchases by Grantee upon exercise of
the Option pursuant to Sections 1 and 2 hereof if all such
regulatory approvals or orders had been obtained, and
(ii) the difference between (A) the Market/Offer
Price (as defined herein), determined as of the date on which
notice of demand for the Trigger Payment is given by Grantee, and
(B) the Option Price (but only if such Market/Offer Price is
higher than such Option Price).
Demand for the Trigger Payment shall be given by notice in
accordance with the provisions of Section 17 hereof. The Trigger
Payment shall be paid to Grantee by Issuer on the Payment Date
(as defined herein), by wire transfer or immediately available
funds to an account to be designated in writing by Grantee not
less than two business days before the Payment Date.
(b) For purposes of this Section 5, "Payment Date"
means the date on which termination fees are required to be paid
by Issuer to Grantee under Sections 8.3(a) or 8.3(b), as the case
may be, of the Merger Agreement as a result of the occurrence of
the Trigger Event referred to in subsection (a) of this Section 5
or such later date as Grantee shall specify with two business
days prior written notice to Issuer.
(c) Issuer shall have no obligation to pay the Trigger
Payment if Grantee is in material breach of any of its
representations or warranties, or in material breach of any of
its covenants or agreements, contained in this Agreement or in
the Merger Agreement.
6. Issuer represents and warrants to Grantee that
(a) Issuer has the corporate power and authority to
enter into this Agreement and to carry out its obligations
hereunder, subject in the case of the repurchase of the Option
Shares pursuant to Section 8(a) to applicable law;
(b) this Agreement has been duly and validly executed
and delivered by Issuer, and, assuming the due authorization,
execution and delivery hereof by Grantee and the receipt of all
required regulatory approvals, constitutes a valid and binding
obligation of Issuer, enforceable against Issuer in accordance
with its terms;
(c) Issuer has taken all necessary corporate action to
authorize and reserve for issuance and to permit it to issue,
upon exercise of the Option, and at all times from the date
hereof through the expiration of the Option will have reserved,
the number of authorized and unissued Option Shares, such amount
being subject to adjustment as provided in Sections 1 and 12, all
of which, upon their issuance and delivery in accordance with the
<PAGE> 82
terms of this Agreement, will be duly authorized, validly issued,
fully paid and nonassessable (except as otherwise provided by
Section 180.0622(2)(b) of the Wisconsin Business Corporation
Law);
(d) upon delivery of the Option Shares to Grantee upon
the exercise of the Option, Grantee will acquire the Option
Shares free and clear of all claims, liens, charges, encumbrances
and security interests of any nature whatsoever;
(e) except as described in Section 4.4 of the Merger
Agreement, the execution and delivery of this Agreement by Issuer
does not, and, subject to compliance with applicable law with
respect to the repurchase of the Option Shares pursuant to
Section 8(a), the consummation by Issuer of the transactions
contemplated hereby will not, violate, conflict with, or result
in a breach of any provision of, or constitute a default (with or
without notice or a lapse of time, or both) under, or result in
the termination of, or accelerate the performance required by, or
result in a right of termination, cancellation, or acceleration
of any obligation or the loss of a material benefit under, or the
creation of a lien, pledge, security interest or other
encumbrance on assets (any such conflict, violation, default,
right of termination, cancellation, acceleration, loss or
creation, hereinafter a "Violation") of Issuer or any of its
Subsidiaries, pursuant to
(i) any provision of the Articles of
Incorporation or the Bylaws of Issuer,
(ii) any provisions of any material loan or credit
agreement, note, mortgage, indenture, lease, benefit plan or
other agreement, obligation, instrument, permit, concession,
franchise or license (any of the foregoing in effect on the date
hereof being referred to as a "Material Contract") of Issuer or
its Subsidiaries or to which any of them is a party, or
(iii) any judgment, order, decree, statute,
law, ordinance, rule or regulation applicable to Issuer or its
properties or assets,
which Violation, in the case of each clauses (ii) and (iii),
could reasonably be expected to have a Material Adverse Effect on
Issuer (except that no representation or warranty is given
concerning any Violation of a Material Contract with respect to
the repurchase of Option Shares pursuant to Section 8(a));
(f) except as described in Section 4.4 of the Merger
Agreement, the execution and delivery of this Agreement by Issuer
does not, and the performance of this Agreement by Issuer will
not, require any consent, approval, authorization or permit of,
filing with or notification to, any Governmental Entity;
<PAGE> 83
(g) none of Issuer, any of its affiliates or anyone
acting on its or their behalf, has issued, sold or offered any
security of Issuer to any person under circumstances that would
cause the issuance and sale of the Option Shares, as contemplated
by this Agreement, to be subject to the registration requirements
of the Securities Act of 1933, as amended (the "Securities Act"),
as in effect on the date hereof, and, assuming the
representations and warranties of Grantee contained in Section
7(g) are true and correct, the issuance, sale and delivery of the
Option Shares hereunder would be exempt from the registration and
prospectus delivery requirements of the Securities Act, as in
effect on the date hereof (and Issuer shall not take any action
which would cause the issuance, sale, and delivery of the Option
Shares hereunder not to be exempt from such requirements); and
(h) any Grantee Shares acquired pursuant to this
Agreement will be acquired for Issuer's own account, for
investment purposes only, and will not be acquired by Issuer with
a view to the public distribution thereof in violation of any
applicable provision of the Securities Act.
7. Grantee represents and warrants to Issuer that
(a) Grantee has the corporate power and authority to
enter into this Agreement and to carry out its obligations
hereunder;
(b) this Agreement has been duly and validly executed
and delivered by Grantee and, assuming the due authorization,
execution and delivery hereof by Issuer and the receipt of all
required regulatory approvals, constitutes a valid and binding
obligation of Grantee, enforceable against Grantee in accordance
with its respective terms;
(c) prior to any delivery of Grantee Shares in
consideration of the purchase of Option Shares pursuant hereto,
Grantee will have taken all necessary corporate action to
authorize for issuance and to permit it to issue such Grantee
Shares, all of which, upon their issuance and delivery in
accordance with the terms of this Agreement, will be duly
authorized, validly issued, fully paid and nonassessable (except
as otherwise provided in Section 180.0622(2)(b) of the Wisconsin
Business Corporation Law);
(d) upon any delivery of such Grantee Shares to Issuer
in consideration of the purchase of the Option Shares pursuant
hereto, Issuer will acquire the Grantee Shares free and clear of
all claims, liens, charges, encumbrances and security interests
of any nature whatsoever;
(e) except as described in Section 3.4 of the Merger
Agreement, the execution and delivery of this Agreement by
Grantee does not, and the consummation by Grantee of the
<PAGE> 84
transactions contemplated hereby will not, violate, conflict
with, or result in the breach of any provision of, or constitute
a default (with or without notice or a lapse of time, or both)
under, or result in any Violation by Grantee or any of its
Subsidiaries, pursuant to
(i) any provision of the Articles of
Incorporation or Bylaws of Grantee,
(ii) any Material Contract of Grantee or any of
its Subsidiaries or to which any of them is a party, or
(iii) any judgment, order, decree, statute,
law, ordinance, rule or regulation applicable to Grantee or its
properties or assets,
which Violation, in the case of each of clauses (ii) or (iii),
would have a Material Adverse Effect on Grantee;
(f) except as described in Section 3.4 of the Merger
Agreement, the execution and delivery of this Agreement by
Grantee does not, and the consummation by Grantee of the
transactions contemplated hereby will not, require any consent,
approval, authorization or permit of, filing with or notification
to, any Governmental Entity; and
(g) any Option Shares acquired upon exercise of the
Option will be acquired for Grantee's own account, for investment
purposes only and will not be, and the Option is not being,
acquired by Grantee with a view to the public distribution
thereof, in violation of any applicable provision of the
Securities Act.
8. (a) At the request of Grantee by written notice (x) at
any time during which the Option is exercisable pursuant to
Section 2 (the "Repurchase Period"), Issuer (or any successor
entity thereof) shall, if permitted by applicable law, the
Articles of Incorporation and Bylaws of the Issuer and Issuer's
Material Contracts, repurchase from Grantee all or any portion of
the Option, at the price set forth in subparagraph (i) below, or,
(y) at any time prior to September 30, 1997, Issuer (or any
successor entity thereof) shall, if permitted by applicable law,
the Articles of Incorporation and Bylaws of Issuer and Issuer's
Material Contracts, repurchase from Grantee all or any portion of
the Option Shares purchased by Grantee pursuant to the Option, at
the price set forth in subparagraph (ii) below:
(i) (A) The difference between the "Market/Offer
Price" (as defined below) for shares of Issuer Common Stock as of
the date Grantee gives notice of its intent to exercise its
rights under this Section 8 and the Option Price, multiplied by
the number of Option Shares purchasable pursuant to the Option
(or portion thereof with respect to which Grantee is exercising
<PAGE> 85
its rights under this Section 8), but only if the Market/Offer
Price is greater than the Option Price.
(B) For purposes of this Agreement,
"Market/Offer Price" shall mean, as of any date, the higher of
(I) the price per share offered as of such date pursuant to any
tender or exchange offer or other offer with respect to a
Business Combination involving Issuer as the Target Party which
was made prior to such date and not terminated or withdrawn as of
such date and (II) the Fair Market Value per share of Issuer
Common Stock as of such date.
(ii) (A) The product of (I) the sum of (a) the
Option Price paid by Grantee per Option Share acquired pursuant
to the Option, and (b) the difference between the "Offer Price"
(as defined below) and the Option Price, but only if the Offer
Price is greater than the Option Price, and (II) the number of
Option Shares so to be repurchased pursuant to this Section 8.
(B) For purposes of this clause (ii), the
"Offer Price" shall be the highest price per share offered
pursuant to a tender or exchange offer or other Business
Combination offer involving Issuer as the Target Party during the
Repurchase Period prior to the delivery by Grantee of a notice of
repurchase.
(b) If Grantee shall have previously elected to
purchase Option Shares pursuant to the exercise of the Option by
the issuance and delivery of Grantee Shares, then Issuer shall,
if so requested by Grantee, in fulfillment of its obligation
pursuant to Section 8(a)(y) (that is, with respect to the Option
Price only and without limitation to its obligation to pay
additional consideration under clause (b) of Section
8(a)(ii)(A)(I)), redeliver the certificates for such Grantee
Shares to Grantee, free and clear of all liens, claims, charges
and encumbrances of any kind or nature whatsoever; PROVIDED,
HOWEVER, that if at any time less than all of the Option Shares
so purchased by Grantee pursuant to the Option are to be
repurchased by Issuer pursuant to Section 8(a)(y), then (i)
Issuer shall be obligated to redeliver to Grantee the same
proportion of such Grantee Shares as the number of Option Shares
that Issuer is then obligated to repurchase bears to the number
of Option Shares acquired by Grantee upon exercise of the Option
and (ii) Grantee shall issue to Issuer new certificates
representing those Grantee Shares which are not due to be
redelivered to Grantee pursuant to this Section 8(b) to the
extent that excess Grantee Shares are included in the
certificates redelivered to Grantee by Issuer.
(c) In the event Grantee exercises its rights under
this Section 8, Issuer shall, within ten business days
thereafter, pay the required amount to Grantee in immediately
available funds and Grantee shall surrender to Issuer the Option
<PAGE> 86
or the certificate or certificates evidencing the Option Shares
purchased by Grantee pursuant hereto, and Grantee shall warrant
that it owns the Option or such shares and that the Option or
such shares are then free and clear of all liens, claims,
damages, charges and encumbrances of any kind or nature
whatsoever.
(d) If Grantee has elected to purchase Option shares
pursuant to the exercise of the Option by the issuance and
delivery of Grantee Shares, notwithstanding that Grantee may no
longer hold any such Option Shares or that Grantee elects not to
exercise its other rights under this Section 8, Grantee may
require, at any time or from time to time prior to September 30,
1997, Issuer to sell to Grantee any such Grantee Shares at the
price attributed to such Grantee Shares pursuant to Section 4
plus interest at the publicly announced prime rate as published
in the Wall Street Journal (Midwest Edition) on such amount from
the Closing Date relating to the exchange of such Grantee shares
pursuant to Section 4 to the Closing Date under this Section 8(d)
less any dividends on such Grantee Shares paid during such period
or declared and payable to shareholders of record on a date
during such period.
(e) In the event the repurchase price specified in
Section 8(a) would subject the purchase of the Option or the
Option Shares purchased by Grantee pursuant to the Option to a
vote of the shareholders of Issuer pursuant to applicable law or
the Articles of Incorporation of Issuer, then Grantee may, at its
election, reduce the repurchase price to an amount which would
permit such repurchase without the necessity for such a
shareholder vote.
9. Following the date hereof and prior to the fifth
anniversary of the date hereof (the "Expiration Date"), each
party shall vote any shares of capital stock of the other party
acquired by such party pursuant to this Agreement ("Restricted
Shares"), including any Grantee Shares issued pursuant to Section
1(c), or otherwise beneficially owned (within the meaning of Rule
13d-3 promulgated under the Securities Exchange Act of 1934, as
amended (the "Exchange Act")), by such party on each matter
submitted to a vote of shareholders of such other party for and
against such matter in the same proportion as the vote of all
other shareholders of such other party are voted (whether by
proxy or otherwise) for and against such matter.
10. (a) Prior to the Expiration Date, neither party shall,
directly or indirectly, sell, assign, pledge, or otherwise
dispose of or transfer any Restricted Shares beneficially owned
by such party, other than (i) pursuant to Section 8, or (ii) in
accordance with Section 10(b) or Section 11.
(b) Following the termination of the Merger Agreement,
a party shall be permitted to sell any Restricted Shares
<PAGE> 87
beneficially owned by it if such sale is made pursuant to a
tender or exchange offer that has been approved or recommended,
or otherwise determined to be fair to and in the best interests
of the shareholders of the other party, by a majority of the
members of the Board of Directors of such other party, which
majority shall include a majority of directors who were directors
prior to the announcement of such tender or exchange offer.
11. (a) Following the termination of the Merger Agreement,
either party hereto that owns Restricted Shares (a "Designated
Holder") may by written notice (the "Registration Notice") to the
other party (the "Registrant") request the Registrant to register
under the Securities Act all or any part of the Restricted Shares
beneficially owned by such Designated Holder (the "Registrable
Securities") pursuant to a bona fide firm commitment underwritten
public offering, in which the Designated Holder and the
underwriters shall effect as wide a distribution of such
Registrable Securities as is reasonably practicable and shall use
their best efforts to prevent any person (including any Group (as
used in Rule 13d-5 under the Exchange Act)) and its affiliates
from purchasing through such offering Restricted Shares
representing more than 1% of the outstanding shares of common
stock of the Registrant on a fully diluted basis (a "Permitted
Offering").
(b) The Registration Notice shall include a
certificate executed by the Designated Holder and its proposed
managing underwriter, which underwriter shall be an investment
banking firm of recognized standing on a national or regional
basis (the "Manager"), stating that
(i) they have a good faith intention to commence
promptly a Permitted Offering, and
(ii) Manager in good faith believes that, based on
the then-prevailing market conditions, it will be able to sell
the Registrable Securities at a per share price equal to at least
80% of the then Fair Market Value of such shares.
(c) The Registrant (and/or any person designed by the
Registrant) shall thereupon have the option exercisable by
written notice delivered to the Designated Holder within ten
business days after the receipt of the Registration Notice,
irrevocably to agree to purchase all or any part of the
Registrable Securities proposed to be so sold for cash at a price
equal to the product of (i) the number of Registrable Securities
to be so purchased by the Registrant and (ii) the then Fair
Market Value of such shares.
(d) Any purchase of Registrable Securities by the
Registrant (or its designee) under Section 11(c) shall take place
at a closing to be held at the principal executive offices of the
Registrant or at the offices of its counsel at any reasonable
<PAGE> 88
date and time designated by the Registrant and/or such designee
in such notice within twenty business days after delivery of such
notice, and any payment for the shares to be so purchased shall
be made by delivery at the time of such closing in immediately
available funds.
(e) If the Registrant does not elect to exercise its
option pursuant to this Section 11 with respect to all
Registrable Securities, it shall use its best efforts to effect,
as promptly as practicable, the registration under the Securities
Act of the unpurchased Registrable Securities proposed to be so
sold; PROVIDED, HOWEVER, that
(i) neither party shall be entitled to demand
more than an aggregate of two effective registration statements
hereunder, and
(ii) the Registrant will not be required to file
any such registration statement during any period of time (not to
exceed 40 days after such request in the case of clause (A) below
or 90 days in the case of clauses (B) and (C) below) when
(A) the Registrant is in possession of
material non-public information which it reasonably believes
would be detrimental to be disclosed at such time and, in the
opinion of counsel to the Registrant, such information would be
required to be disclosed if a registration statement were filed
at that time;
(B) the Registrant is required under the
Securities Act to include audited financial statements for any
period in such registration statement and such financial
statements are not yet available for inclusion in such
registration statement; or
(C) the Registrant determines, in its
reasonable judgment, that such registration would interfere with
any financing, acquisition or other material transaction
involving the Registrant or any of its affiliates.
(f) The Registrant shall use its reasonable best
efforts to cause any Registrable Securities registered pursuant
to this Section 11 to be qualified for sale under the securities
or Blue Sky laws of such jurisdictions as the Designated Holder
may reasonably request and shall continue such registration or
qualification in effect in such jurisdiction; PROVIDED, HOWEVER,
that the Registrant shall not be required to qualify to do
business in, or consent to general service of process in, any
jurisdiction by reason of this provision.
(g) The registration rights set forth in this Section
11 are subject to the condition that the Designated Holder shall
provide the Registrant with such information with respect to such
<PAGE> 89
holder's Registrable Securities, the plans for the distribution
thereof, and such other information with respect to such holder
as, in the reasonable judgment of counsel for the Registrant, is
necessary to enable the Registrant to include in such
registration statement all material facts required to be
disclosed with respect to a registration thereunder.
(h) A registration effected under this Section 11
shall be effected at the Registrant's expense, except for
underwriting discounts and commissions and the fees and the
expenses of counsel to the Designated Holder, and the Registrant
shall provide to the underwriters such documentation (including
certificates, opinions of counsel and "comfort" letters from
auditors) as is customary in connection with underwritten public
offerings as such underwriters may reasonably require.
(i) In connection with any registration effected under
this Section 11, the parties agree
(i) to indemnify each other and the underwriters
in the customary manner,
(ii) to enter into an underwriting agreement in
form and substance customary for transactions of such type with
the Manager and the other underwriters participating in such
offering, and
(iii) to take all further actions which shall
be reasonably necessary to effect such registration and sale
(including if the Manager deems it necessary, participating in
road show presentations).
(j) The Registrant shall be entitled to include (at
its expense) additional shares of its common stock in a
registration effected pursuant to this Section 11 only if and to
the extent the Manager determines that such inclusion will not
adversely affect the prospects for success of such offering.
12. Without limitation to any restriction on Issuer
contained in this Agreement or in the Merger Agreement, in the
event of any change in Issuer Common Stock by reason of stock
dividends, splitups, mergers (other than the Merger),
recapitalizations, combinations, exchange of shares or the like,
the type and number of shares or securities subject to the
Option, and the Option Price provided in Section 1, shall be
adjusted appropriately to restore to Grantee its rights
hereunder, including the right to purchase from Issuer (or its
successors) shares of Issuer Common Stock (or such other shares
or securities into which Issuer Common Stock has been so changed)
for the aggregate Option Price as provided in Section 1.
13. Each certificate representing Option Shares issued to
Grantee hereunder, and Grantee Shares, if any, delivered to
<PAGE> 90
Issuer at a Closing, shall include a legend in substantially the
following form:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR ANY STATE SECURITIES OR BLUE SKY LAWS, AND
MAY BE REOFFERED OR SOLD ONLY IF SO REGISTERED OR IF AN
EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE. SUCH
SECURITIES ARE ALSO SUBJECT TO ADDITIONAL RESTRICTIONS
ON TRANSFER AS SET FORTH IN A STOCK OPTION AND TRIGGER
PAYMENT AGREEMENT, DATED AS OF NOVEMBER 13, 1996, A
COPY OF WHICH MAY BE OBTAINED FROM THE ISSUER UPON
REQUEST.
It is understood and agreed that:
(i) the reference to the resale restrictions of
the Securities Act and state securities or Blue Sky laws in the
above legend shall be removed by delivery of substitute
certificate(s) without such reference if Grantee or Issuer, as
the case may be, shall have delivered to the other party a copy
of a letter from the staff of the Securities and Exchange
Commission, or an opinion of counsel, in form and substance
reasonably satisfactory to the other party, to the effect that
such legend is not required for purposes of the Securities Act or
such laws;
(ii) the reference to the provisions to this
Agreement in the above legend shall be removed by delivery of
substitute certificate(s) without such reference if the shares
have been sold or transferred in compliance with the provisions
of this Agreement and under circumstances that do not require the
retention of such reference; and
(iii) the legend shall be removed in its
entirety if the conditions in the preceding clauses (i) and (ii)
are both satisfied.
In addition, such certificates shall bear any other legend as may
be required by law. Certificates representing shares sold in a
registered public offering pursuant to Section 11 shall not be
required to bear the legend set forth in this Section 13.
14. (a) This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors
and permitted assigns.
(b) Except as expressly provided for in this
Agreement, neither this Agreement nor the rights or obligations
of either party hereto are assignable, except by operation of
law, or with the written consent of the other party.
<PAGE> 91
(c) Nothing contained in this Agreement, express or
implied, is intended to confer upon any person other than the
parties hereto and their respective successors and permitted
assigns any rights or remedies of any nature whatsoever by reason
of this Agreement.
(d) Any Restricted Shares sold by a party in
compliance with the provisions of Section 11 shall, upon
consummation of such sale, be free of the restrictions imposed
with respect to such shares by this Agreement, unless and until
such party shall repurchase or otherwise become the beneficial
owner of such shares, and any transferee of such shares shall not
be entitled to the registration rights of such party.
15. The parties hereto acknowledge that damages would
be an inadequate remedy for a breach of this Agreement by either
party hereto and that the obligations of the parties hereto shall
be enforceable by either party hereto through injunctive or other
equitable relief.
16. If any term, provision, covenant or restriction
contained in this Agreement is held by a court or a federal or
state regulatory agency of competent jurisdiction to be invalid,
void or unenforceable, the remainder of the terms, provisions and
covenants and restrictions contained in this Agreement shall
remain in full force and effect, and shall in no way be affected,
impaired or invalidated. Subject to Section 5, if for any reason
any such court or regulatory agency determines that Grantee is
not permitted to acquire, or Issuer is not permitted to
repurchase pursuant to Section 8, the full number of Option
Shares provided in Section 1 hereof (as the same may be
adjusted), it is the express intention of Issuer to allow Grantee
to acquire or to require Issuer to repurchase such lesser number
of shares as may be permissible without any amendment or
modification hereof.
17. All notices and other communications hereunder
shall be in writing and shall be deemed given if delivered
personally, telecopied (with confirmation), mailed by registered
or certified mail (return receipt requested) or delivered by an
express courier (with confirmation) at the respective addresses
of the parties set forth in the Merger Agreement (or at such
other address for a party as shall be specified by like notice).
18. This Agreement shall be governed by and construed
in accordance with the laws of the State of Wisconsin, regardless
of the laws that might otherwise govern under applicable
principles of conflicts of laws thereof.
19. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original,
but all of which shall constitute one and the same agreement.
<PAGE> 92
20. Except as otherwise expressly provided herein,
each of the parties hereto shall bear and pay all costs and
expenses incurred by it or on its behalf in connection with the
transactions contemplated hereunder, including fees and expenses
of its own financial consultants, investment bankers, accountants
and counsel.
21. Except as otherwise expressly provided herein or
in the Merger Agreement, this Agreement contains the entire
agreement between the parties with respect to the transactions
contemplated hereunder and supersedes all prior arrangements or
understandings with respect thereof, written or oral.
22. This Agreement may be amended by the parties
hereto and the terms and conditions hereof may be waived only by
an instrument in writing signed on behalf of each of the parties
hereto, or, in the case of a waiver, by an instrument signed on
behalf of the party waiving compliance.
23. The time periods for exercises of certain rights
under Sections 2, 5 and 8 shall be extended (but in no event by
more than six months):
(a) to the extent necessary to obtain all regulatory
approvals for the exercise of such rights; and
(b) to the extent necessary to avoid any liability
under Section 16(b) of the Exchange Act by reason of such
exercise.
24. Capitalized terms used in this Agreement and not
defined herein shall have the meanings assigned thereto in the
Merger Agreement.
<PAGE> 93
IN WITNESS WHEREOF, each of the parties has caused this
Agreement to be executed on its behalf by its officers thereunto
duly authorized, all as of the date first above written.
FCB FINANCIAL CORP.
By: /s/ Donald D. Parker
------------------------------
Donald D. Parker
President and Chief Executive
Officer
OSB FINANCIAL CORP.
By:/s/ James J. Rothenbach
------------------------------
James J. Rothenbach
President and Chief Executive
Officer
<PAGE> 94
Exhibit B
STOCK OPTION AND TRIGGER PAYMENT AGREEMENT (the
"Agreement"), dated November 13, 1996, between OSB Financial
Corp., a Wisconsin corporation ("Issuer"), and FCB Financial
Corp., a Wisconsin corporation ("Grantee").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, Grantee and Issuer have entered into an
Agreement and Plan of Merger of even date herewith (the "Merger
Agreement"), which agreement has been executed by the parties
hereto immediately prior to this Stock Option and Trigger
Agreement; and
WHEREAS, as a condition to Grantee's entering into the
Merger Agreement and in consideration therefor, Issuer has agreed
to grant Grantee the Option (as hereinafter defined).
NOW, THEREFORE, in consideration of the foregoing and
the mutual covenants and agreements set forth herein and in the
Merger Agreement, the parties hereto agree as follows:
1. (a) Issuer hereby grants to Grantee an unconditional,
irrevocable option (the "Option") to purchase, subject to the
terms hereof, up to 230,866 fully paid and nonassessable (except
as otherwise provided by Section 180.0622(2)(b) of the Wisconsin
Business Corporation Law) shares (the "Option Shares") of
Issuer's Common Stock, par value $0.01 per share ("Issuer Common
Stock"), at a price of $24.375 per share (the "Option Price");
PROVIDED, HOWEVER, that in no event shall the number of shares of
Issuer Common Stock for which this Option is exercisable exceed
19.9% of the issued and outstanding shares of Issuer Common Stock
without giving effect to any shares subject to or issued pursuant
to the Option. The number of shares of Issuer Common Stock that
may be received upon the exercise of the Option and the Option
Price are subject to adjustment as herein set forth.
(b) In the event that any additional shares of Issuer
Common Stock are either (i) issued or otherwise become
outstanding after the date of this Agreement (other than pursuant
to this Agreement) or (ii) redeemed, repurchased, retired or
otherwise cease to be outstanding after the date of this
Agreement (such event a "Change in Shares Outstanding Event"),
the number of shares of Issuer Common Stock subject to the Option
shall be increased or decreased, as appropriate, so that, after
such Change in Shares Outstanding Event, such number equals 19.9%
of the number of shares of Issuer Common Stock then issued and
outstanding without giving effect to any shares subject or issued
pursuant to the Option. Nothing contained in this Section 1(b)
or elsewhere in this Agreement shall be deemed to authorize
<PAGE> 95
Issuer to issue or redeem, repurchase, or retire shares of Issuer
Common Stock or to authorize either the Issuer or the Grantee
otherwise to breach any provision of the Merger Agreement.
(c) The Option Price shall be payable, at the option
of the Grantee, as follows:
(i) in cash, or
(ii) subject to the receipt of all approvals of
any Governmental Entity required for the Issuer to acquire, and
Grantee to issue, the Grantee Shares (as defined below) from
Grantee, in shares of common stock, $0.01 par value, of Grantee
("Grantee Shares"),
in either case in accordance with Section 4 hereof.
(d) As used in this Agreement, the "Fair Market Value"
of any share shall be the average of the last sales price for
such share on The Nasdaq Stock Market during the ten trading days
prior to the fifth trading day preceding the date such Fair
Market Value is to be determined.
2. (a) The Option may be exercised by Grantee, in whole
or in part, at any time or from time to time after the Merger
Agreement becomes terminable by Grantee under circumstances which
could entitle Grantee to a termination fee (as opposed to the
reimbursement of expenses only) under Section 8.3(a) of the
Merger Agreement or Section 8.3(b) of the Merger Agreement
(regardless of whether the Merger Agreement is actually
terminated), any such event by which the Merger Agreement becomes
so terminable by Grantee being referred to herein as a " Trigger
Event."
(b) (i) Issuer shall notify Grantee promptly in
writing of the occurrence of any Trigger Event, it being
understood that the giving of such notice by Issuer shall not be
a condition to the right of Grantee to exercise the Option.
(ii) In the event Grantee wishes to exercise the
Option, Grantee shall deliver to Issuer written notice (an
"Exercise Notice") specifying the total number of Option Shares
it wishes to purchase.
(iii) Upon the giving by Grantee of Issuer of
the Exercise Notice and the tender of the applicable aggregate
Option Price, Grantee, to the extent permitted by law and
Issuer's organizational documents, and provided that the
conditions to Issuer's obligation to issue Option Shares to
Grantee hereunder set forth in Section 3 have been satisfied or
waived, shall be deemed to be the holder of record of the Option
Shares issuable upon such exercise, notwithstanding that the
stock transfer books of Issuer shall then be closed or that
<PAGE> 96
certificates representing such Option Shares shall not then be
actually delivered to Grantee.
(iv) Each closing of a purchase of Option Shares
(a "Closing") shall occur at a place, on a date, and at a time
designated by Grantee in an Exercise Notice delivered at least
two business days prior to the date of the Closing.
(c) The Option shall terminate upon the earliest to
occur of:
(i) the Effective Time of the Merger;
(ii) the termination of the Merger Agreement
pursuant to Section 8.1 thereof, other than under circumstances
which also constitute a Trigger Event under this Agreement;
(iii) 180 days following any termination of
the Merger Agreement upon or during the continuance of a Trigger
Event (or if, at the expiration of such 180-day period, the
Option cannot be exercised by reason of any applicable judgment,
decree, order, law or regulation, ten business days after such
impediment to exercise shall have been removed or shall have
become final and not subject to appeal, but in no event under
this clause (iii) later than September 30, 1997); and
(iv) payment by Issuer of the Trigger Payment set
forth in Section 5 of this Agreement to Grantee.
(d) Notwithstanding the foregoing, the Option may not
be exercised if (i) Grantee is in material breach of any of its
representations or warranties, or in material breach of any of
its covenants or agreements, contained in this Agreement or in
the Merger Agreement, or (ii) a Trigger Payment has been paid
pursuant to Section 5 of this Agreement or demand therefor has
been made and not withdrawn.
3. The obligation of Issuer to issue Option Shares to
Grantee hereunder is subject to the conditions that
(a) the Option Shares, and any Grantee Shares which
are issued in payment of the Option Price, shall have been
approved for listing on The Nasdaq Stock Market;
(b) all consents, approvals, orders or authorizations
of, or registrations, declarations or filings with, any federal,
state or local administrative agency or commission or other
federal, state or local Governmental Entity, if any, required in
connection with the issuance by Issuer and the acquisition by
Grantee of the Option Shares hereunder shall have been obtained
or made; and
<PAGE> 97
(c) no preliminary or permanent injunction or other
order by any court of competent jurisdiction prohibiting or
otherwise restraining such issuance shall be in effect.
The condition set forth in paragraph (a) above may be waived by
Issuer, in the case of Grantee Shares, and by Grantee, in the
case of Option Shares, in the sole discretion of the waiving
party.
4. At any Closing,
(a) Issuer shall deliver to Grantee or its designee a
single certificate in definitive form representing the number of
Option Shares designated by Grantee in its Exercise Notice, such
certificate to be registered in the name of Grantee and to bear
the legend set forth in Section 13; and
(b) Grantee shall deliver to issuer the aggregate
price for the Option Shares so designated and being purchased by
(i) wire transfer of immediately available funds
or certified check or bank check, or
(ii) subject to the condition in Section 1(c)(ii),
delivery of a certificate or certificates representing the number
of Grantee Shares being issued by Grantee in consideration
thereof, determined in accordance with Section 4(c).
(c) In the event that Grantee issues Grantee Shares to
Issuer in consideration of Option Shares pursuant to Section
4(b)(ii), the number of Grantee Shares to be so issued shall be
equal to the quotient obtained by dividing:
(i) the product of (x) the number of Option
Shares with respect to which the Option is being exercised and
(y) the Option Price, by
(ii) the Fair Market Value of the Grantee Shares
as of the date immediately preceding the date the Exercise Notice
is delivered to Issuer.
(d) Issuer shall pay all expenses, and any and all
federal, state and local taxes and other charges that may be
payable in connection with the preparation, issue and delivery of
stock certificates under this Section 4.
5. (a) Subject to the provisions of Section 8.3(d) of the
Merger Agreement, if a Trigger Event shall have occurred and any
regulatory approval or order required for the issuance by Issuer,
or the acquisition by Grantee, of the Option or the Option Shares
upon exercise of the Option shall not have been obtained, Grantee
shall have the right to receive, and Issuer shall pay to Grantee,
an amount (the "Trigger Payment") equal to the product of
<PAGE> 98
(i) the maximum number of Option Shares that
would have been subject to purchases by Grantee upon exercise of
the Option pursuant to Sections 1 and 2 hereof if all such
regulatory approvals or orders had been obtained, and
(ii) the difference between (A) the Market/Offer
Price (as defined herein), determined as of the date on which
notice of demand for the Trigger Payment is given by Grantee, and
(B) the Option Price (but only if such Market/Offer Price is
higher than such Option Price).
Demand for the Trigger Payment shall be given by notice in
accordance with the provisions of Section 17 hereof. The Trigger
Payment shall be paid to Grantee by Issuer on the Payment Date
(as defined herein), by wire transfer or immediately available
funds to an account to be designated in writing by Grantee not
less than two business days before the Payment Date.
(b) For purposes of this Section 5, "Payment Date"
means the date on which termination fees are required to be paid
by Issuer to Grantee under Sections 8.3(a) or 8.3(b), as the case
may be, of the Merger Agreement as a result of the occurrence of
the Trigger Event referred to in subsection (a) of this Section 5
or such later date as Grantee shall specify with two business
days prior written notice to Issuer.
(c) Issuer shall have no obligation to pay the Trigger
Payment if Grantee is in material breach of any of its
representations or warranties, or in material breach of any of
its covenants or agreements, contained in this Agreement or in
the Merger Agreement.
6. Issuer represents and warrants to Grantee that
(a) Issuer has the corporate power and authority to
enter into this Agreement and to carry out its obligations
hereunder, subject in the case of the repurchase of the Option
Shares pursuant to Section 8(a) to applicable law;
(b) this Agreement has been duly and validly executed
and delivered by Issuer, and, assuming the due authorization,
execution and delivery hereof by Grantee and the receipt of all
required regulatory approvals, constitutes a valid and binding
obligation of Issuer, enforceable against Issuer in accordance
with its terms;
(c) Issuer has taken all necessary corporate action to
authorize and reserve for issuance and to permit it to issue,
upon exercise of the Option, and at all times from the date
hereof through the expiration of the Option will have reserved,
the number of authorized and unissued Option Shares, such amount
being subject to adjustment as provided in Sections 1 and 12, all
of which, upon their issuance and delivery in accordance with the
<PAGE> 99
terms of this Agreement, will be duly authorized, validly issued,
fully paid and nonassessable (except as otherwise provided by
Section 180.0622(2)(b) of the Wisconsin Business Corporation
Law);
(d) upon delivery of the Option Shares to Grantee upon
the exercise of the Option, Grantee will acquire the Option
Shares free and clear of all claims, liens, charges, encumbrances
and security interests of any nature whatsoever;
(e) except as described in Section 3.4 of the Merger
Agreement, the execution and delivery of this Agreement by Issuer
does not, and, subject to compliance with applicable law with
respect to the repurchase of the Option Shares pursuant to
Section 8(a), the consummation by Issuer of the transactions
contemplated hereby will not, violate, conflict with, or result
in a breach of any provision of, or constitute a default (with or
without notice or a lapse of time, or both) under, or result in
the termination of, or accelerate the performance required by, or
result in a right of termination, cancellation, or acceleration
of any obligation or the loss of a material benefit under, or the
creation of a lien, pledge, security interest or other
encumbrance on assets (any such conflict, violation, default,
right of termination, cancellation, acceleration, loss or
creation, hereinafter a "Violation") of Issuer or any of its
Subsidiaries, pursuant to
(i) any provision of the Articles of
Incorporation or the Bylaws of Issuer,
(ii) any provisions of any material loan or credit
agreement, note, mortgage, indenture, lease, benefit plan or
other agreement, obligation, instrument, permit, concession,
franchise or license (any of the foregoing in effect on the date
hereof being referred to as a "Material Contract") of Issuer or
its Subsidiaries or to which any of them is a party, or
(iii) any judgment, order, decree, statute,
law, ordinance, rule or regulation applicable to Issuer or its
properties or assets,
which Violation, in the case of each clauses (ii) and (iii),
could reasonably be expected to have a Material Adverse Effect on
Issuer (except that no representation or warranty is given
concerning any Violation of a Material Contract with respect to
the repurchase of Option Shares pursuant to Section 8(a));
(f) except as described in Section 3.4 of the Merger
Agreement, the execution and delivery of this Agreement by Issuer
does not, and the performance of this Agreement by Issuer will
not, require any consent, approval, authorization or permit of,
filing with or notification to, any Governmental Entity;
<PAGE> 100
(g) none of Issuer, any of its affiliates or anyone
acting on its or their behalf, has issued, sold or offered any
security of Issuer to any person under circumstances that would
cause the issuance and sale of the Option Shares, as contemplated
by this Agreement, to be subject to the registration requirements
of the Securities Act of 1933, as amended (the "Securities Act"),
as in effect on the date hereof, and, assuming the
representations and warranties of Grantee contained in Section
7(g) are true and correct, the issuance, sale and delivery of the
Option Shares hereunder would be exempt from the registration and
prospectus delivery requirements of the Securities Act, as in
effect on the date hereof (and Issuer shall not take any action
which would cause the issuance, sale, and delivery of the Option
Shares hereunder not to be exempt from such requirements); and
(h) any Grantee Shares acquired pursuant to this
Agreement will be acquired for Issuer's own account, for
investment purposes only, and will not be acquired by Issuer with
a view to the public distribution thereof in violation of any
applicable provision of the Securities Act.
7. Grantee represents and warrants to Issuer that
(a) Grantee has the corporate power and authority to
enter into this Agreement and to carry out its obligations
hereunder;
(b) this Agreement has been duly and validly executed
and delivered by Grantee and, assuming the due authorization,
execution and delivery hereof by Issuer and the receipt of all
required regulatory approvals, constitutes a valid and binding
obligation of Grantee, enforceable against Grantee in accordance
with its respective terms;
(c) prior to any delivery of Grantee Shares in
consideration of the purchase of Option Shares pursuant hereto,
Grantee will have taken all necessary corporate action to
authorize for issuance and to permit it to issue such Grantee
Shares, all of which, upon their issuance and delivery in
accordance with the terms of this Agreement, will be duly
authorized, validly issued, fully paid and nonassessable (except
as otherwise provided in Section 180.0622(2)(b) of the Wisconsin
Business Corporation Law);
(d) upon any delivery of such Grantee Shares to Issuer
in consideration of the purchase of the Option Shares pursuant
hereto, Issuer will acquire the Grantee Shares free and clear of
all claims, liens, charges, encumbrances and security interests
of any nature whatsoever;
(e) except as described in Section 3.4 of the Merger
Agreement, the execution and delivery of this Agreement by
Grantee does not, and the consummation by Grantee of the
<PAGE> 101
transactions contemplated hereby will not, violate, conflict
with, or result in the breach of any provision of, or constitute
a default (with or without notice or a lapse of time, or both)
under, or result in any Violation by Grantee or any of its
Subsidiaries, pursuant to
(i) any provision of the Articles of
Incorporation or Bylaws of Grantee,
(ii) any Material Contract of Grantee or any of
its Subsidiaries or to which any of them is a party, or
(iii) any judgment, order, decree, statute,
law, ordinance, rule or regulation applicable to Grantee or its
properties or assets,
which Violation, in the case of each of clauses (ii) or (iii),
would have a Material Adverse Effect on Grantee;
(f) except as described in Section 3.4 of the Merger
Agreement, the execution and delivery of this Agreement by
Grantee does not, and the consummation by Grantee of the
transactions contemplated hereby will not, require any consent,
approval, authorization or permit of, filing with or notification
to, any Governmental Entity; and
(g) any Option Shares acquired upon exercise of the
Option will be acquired for Grantee's own account, for investment
purposes only and will not be, and the Option is not being,
acquired by Grantee with a view to the public distribution
thereof, in violation of any applicable provision of the
Securities Act.
8. (a) At the request of Grantee by written notice (x) at
any time during which the Option is exercisable pursuant to
Section 2 (the "Repurchase Period"), Issuer (or any successor
entity thereof) shall, if permitted by applicable law, the
Articles of Incorporation and Bylaws of the Issuer and Issuer's
Material Contracts, repurchase from Grantee all or any portion of
the Option, at the price set forth in subparagraph (i) below, or,
(y) at any time prior to September 30, 1997, Issuer (or any
successor entity thereof) shall, if permitted by applicable law,
the Articles of Incorporation and Bylaws of Issuer and Issuer's
Material Contracts, repurchase from Grantee all or any portion of
the Option Shares purchased by Grantee pursuant to the Option, at
the price set forth in subparagraph (ii) below:
(i) (A) The difference between the "Market/Offer
Price" (as defined below) for shares of Issuer Common Stock as of
the date Grantee gives notice of its intent to exercise its
rights under this Section 8 and the Option Price, multiplied by
the number of Option Shares purchasable pursuant to the Option
(or portion thereof with respect to which Grantee is exercising
<PAGE> 102
its rights under this Section 8), but only if the Market/Offer
Price is greater than the Option Price.
(B) For purposes of this Agreement,
"Market/Offer Price" shall mean, as of any date, the higher of
(I) the price per share offered as of such date pursuant to any
tender or exchange offer or other offer with respect to a
Business Combination involving Issuer as the Target Party which
was made prior to such date and not terminated or withdrawn as of
such date and (II) the Fair Market Value per share of Issuer
Common Stock as of such date.
(ii) (A) The product of (I) the sum of (a) the
Option Price paid by Grantee per Option Share acquired pursuant
to the Option, and (b) the difference between the "Offer Price"
(as defined below) and the Option Price, but only if the Offer
Price is greater than the Option Price, and (II) the number of
Option Shares so to be repurchased pursuant to this Section 8.
(B) For purposes of this clause (ii), the
"Offer Price" shall be the highest price per share offered
pursuant to a tender or exchange offer or other Business
Combination offer involving Issuer as the Target Party during the
Repurchase Period prior to the delivery by Grantee of a notice of
repurchase.
(b) If Grantee shall have previously elected to
purchase Option Shares pursuant to the exercise of the Option by
the issuance and delivery of Grantee Shares, then Issuer shall,
if so requested by Grantee, in fulfillment of its obligation
pursuant to Section 8(a)(y) (that is, with respect to the Option
Price only and without limitation to its obligation to pay
additional consideration under clause (b) of Section
8(a)(ii)(A)(I)), redeliver the certificates for such Grantee
Shares to Grantee, free and clear of all liens, claims, charges
and encumbrances of any kind or nature whatsoever; PROVIDED,
HOWEVER, that if at any time less than all of the Option Shares
so purchased by Grantee pursuant to the Option are to be
repurchased by Issuer pursuant to Section 8(a)(y), then (i)
Issuer shall be obligated to redeliver to Grantee the same
proportion of such Grantee Shares as the number of Option Shares
that Issuer is then obligated to repurchase bears to the number
of Option Shares acquired by Grantee upon exercise of the Option
and (ii) Grantee shall issue to Issuer new certificates
representing those Grantee Shares which are not due to be
redelivered to Grantee pursuant to this Section 8(b) to the
extent that excess Grantee Shares are included in the
certificates redelivered to Grantee by Issuer.
(c) In the event Grantee exercises its rights under
this Section 8, Issuer shall, within ten business days
thereafter, pay the required amount to Grantee in immediately
available funds and Grantee shall surrender to Issuer the Option
<PAGE> 103
or the certificate or certificates evidencing the Option Shares
purchased by Grantee pursuant hereto, and Grantee shall warrant
that it owns the Option or such shares and that the Option or
such shares are then free and clear of all liens, claims,
damages, charges and encumbrances of any kind or nature
whatsoever.
(d) If Grantee has elected to purchase Option shares
pursuant to the exercise of the Option by the issuance and
delivery of Grantee Shares, notwithstanding that Grantee may no
longer hold any such Option Shares or that Grantee elects not to
exercise its other rights under this Section 8, Grantee may
require, at any time or from time to time prior to September 30,
1997, Issuer to sell to Grantee any such Grantee Shares at the
price attributed to such Grantee Shares pursuant to Section 4
plus interest at the publicly announced prime rate as published
in the Wall Street Journal (Midwest Edition) on such amount from
the Closing Date relating to the exchange of such Grantee shares
pursuant to Section 4 to the Closing Date under this Section 8(d)
less any dividends on such Grantee Shares paid during such period
or declared and payable to shareholders of record on a date
during such period.
(e) In the event the repurchase price specified in
Section 8(a) would subject the purchase of the Option or the
Option Shares purchased by Grantee pursuant to the Option to a
vote of the shareholders of Issuer pursuant to applicable law or
the Articles of Incorporation of Issuer, then Grantee may, at its
election, reduce the repurchase price to an amount which would
permit such repurchase without the necessity for such a
shareholder vote.
9. Following the date hereof and prior to the fifth
anniversary of the date hereof (the "Expiration Date"), each
party shall vote any shares of capital stock of the other party
acquired by such party pursuant to this Agreement ("Restricted
Shares"), including any Grantee Shares issued pursuant to Section
1(c), or otherwise beneficially owned (within the meaning of Rule
13d-3 promulgated under the Securities Exchange Act of 1934, as
amended (the "Exchange Act")), by such party on each matter
submitted to a vote of shareholders of such other party for and
against such matter in the same proportion as the vote of all
other shareholders of such other party are voted (whether by
proxy or otherwise) for and against such matter.
10. (a) Prior to the Expiration Date, neither party shall,
directly or indirectly, sell, assign, pledge, or otherwise
dispose of or transfer any Restricted Shares beneficially owned
by such party, other than (i) pursuant to Section 8, or (ii) in
accordance with Section 10(b) or Section 11.
(b) Following the termination of the Merger Agreement,
a party shall be permitted to sell any Restricted Shares
<PAGE> 104
beneficially owned by it if such sale is made pursuant to a
tender or exchange offer that has been approved or recommended,
or otherwise determined to be fair to and in the best interests
of the shareholders of the other party, by a majority of the
members of the Board of Directors of such other party, which
majority shall include a majority of directors who were directors
prior to the announcement of such tender or exchange offer.
11. (a) Following the termination of the Merger Agreement,
either party hereto that owns Restricted Shares (a "Designated
Holder") may by written notice (the "Registration Notice") to the
other party (the "Registrant") request the Registrant to register
under the Securities Act all or any part of the Restricted Shares
beneficially owned by such Designated Holder (the "Registrable
Securities") pursuant to a bona fide firm commitment underwritten
public offering, in which the Designated Holder and the
underwriters shall effect as wide a distribution of such
Registrable Securities as is reasonably practicable and shall use
their best efforts to prevent any person (including any Group (as
used in Rule 13d-5 under the Exchange Act)) and its affiliates
from purchasing through such offering Restricted Shares
representing more than 1% of the outstanding shares of common
stock of the Registrant on a fully diluted basis (a "Permitted
Offering").
(b) The Registration Notice shall include a
certificate executed by the Designated Holder and its proposed
managing underwriter, which underwriter shall be an investment
banking firm of recognized standing on a national or regional
basis (the "Manager"), stating that
(i) they have a good faith intention to commence
promptly a Permitted Offering, and
(ii) Manager in good faith believes that, based on
the then-prevailing market conditions, it will be able to sell
the Registrable Securities at a per share price equal to at least
80% of the then Fair Market Value of such shares.
(c) The Registrant (and/or any person designed by the
Registrant) shall thereupon have the option exercisable by
written notice delivered to the Designated Holder within ten
business days after the receipt of the Registration Notice,
irrevocably to agree to purchase all or any part of the
Registrable Securities proposed to be so sold for cash at a price
equal to the product of (i) the number of Registrable Securities
to be so purchased by the Registrant and (ii) the then Fair
Market Value of such shares.
(d) Any purchase of Registrable Securities by the
Registrant (or its designee) under Section 11(c) shall take place
at a closing to be held at the principal executive offices of the
Registrant or at the offices of its counsel at any reasonable
<PAGE> 105
date and time designated by the Registrant and/or such designee
in such notice within twenty business days after delivery of such
notice, and any payment for the shares to be so purchased shall
be made by delivery at the time of such closing in immediately
available funds.
(e) If the Registrant does not elect to exercise its
option pursuant to this Section 11 with respect to all
Registrable Securities, it shall use its best efforts to effect,
as promptly as practicable, the registration under the Securities
Act of the unpurchased Registrable Securities proposed to be so
sold; PROVIDED, HOWEVER, that
(i) neither party shall be entitled to demand
more than an aggregate of two effective registration statements
hereunder, and
(ii) the Registrant will not be required to file
any such registration statement during any period of time (not to
exceed 40 days after such request in the case of clause (A) below
or 90 days in the case of clauses (B) and (C) below) when
(A) the Registrant is in possession of
material non-public information which it reasonably believes
would be detrimental to be disclosed at such time and, in the
opinion of counsel to the Registrant, such information would be
required to be disclosed if a registration statement were filed
at that time;
(B) the Registrant is required under the
Securities Act to include audited financial statements for any
period in such registration statement and such financial
statements are not yet available for inclusion in such
registration statement; or
(C) the Registrant determines, in its
reasonable judgment, that such registration would interfere with
any financing, acquisition or other material transaction
involving the Registrant or any of its affiliates.
(f) The Registrant shall use its reasonable best
efforts to cause any Registrable Securities registered pursuant
to this Section 11 to be qualified for sale under the securities
or Blue Sky laws of such jurisdictions as the Designated Holder
may reasonably request and shall continue such registration or
qualification in effect in such jurisdiction; PROVIDED, HOWEVER,
that the Registrant shall not be required to qualify to do
business in, or consent to general service of process in, any
jurisdiction by reason of this provision.
(g) The registration rights set forth in this Section
11 are subject to the condition that the Designated Holder shall
provide the Registrant with such information with respect to such
<PAGE> 106
holder's Registrable Securities, the plans for the distribution
thereof, and such other information with respect to such holder
as, in the reasonable judgment of counsel for the Registrant, is
necessary to enable the Registrant to include in such
registration statement all material facts required to be
disclosed with respect to a registration thereunder.
(h) A registration effected under this Section 11
shall be effected at the Registrant's expense, except for
underwriting discounts and commissions and the fees and the
expenses of counsel to the Designated Holder, and the Registrant
shall provide to the underwriters such documentation (including
certificates, opinions of counsel and "comfort" letters from
auditors) as is customary in connection with underwritten public
offerings as such underwriters may reasonably require.
(i) In connection with any registration effected under
this Section 11, the parties agree
(i) to indemnify each other and the underwriters
in the customary manner,
(ii) to enter into an underwriting agreement in
form and substance customary for transactions of such type with
the Manager and the other underwriters participating in such
offering, and
(iii) to take all further actions which shall
be reasonably necessary to effect such registration and sale
(including if the Manager deems it necessary, participating in
road show presentations).
(j) The Registrant shall be entitled to include (at
its expense) additional shares of its common stock in a
registration effected pursuant to this Section 11 only if and to
the extent the Manager determines that such inclusion will not
adversely affect the prospects for success of such offering.
12. Without limitation to any restriction on Issuer
contained in this Agreement or in the Merger Agreement, in the
event of any change in Issuer Common Stock by reason of stock
dividends, splitups, mergers (other than the Merger),
recapitalizations, combinations, exchange of shares or the like,
the type and number of shares or securities subject to the
Option, and the Option Price provided in Section 1, shall be
adjusted appropriately to restore to Grantee its rights
hereunder, including the right to purchase from Issuer (or its
successors) shares of Issuer Common Stock (or such other shares
or securities into which Issuer Common Stock has been so changed)
for the aggregate Option Price as provided in Section 1.
13. Each certificate representing Option Shares issued to
Grantee hereunder, and Grantee Shares, if any, delivered to
<PAGE> 107
Issuer at a Closing, shall include a legend in substantially the
following form:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR ANY STATE SECURITIES OR BLUE SKY LAWS, AND
MAY BE REOFFERED OR SOLD ONLY IF SO REGISTERED OR IF AN
EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE. SUCH
SECURITIES ARE ALSO SUBJECT TO ADDITIONAL RESTRICTIONS
ON TRANSFER AS SET FORTH IN A STOCK OPTION AND TRIGGER
PAYMENT AGREEMENT, DATED AS OF NOVEMBER 13, 1996, A
COPY OF WHICH MAY BE OBTAINED FROM THE ISSUER UPON
REQUEST.
It is understood and agreed that:
(i) the reference to the resale restrictions of
the Securities Act and state securities or Blue Sky laws in the
above legend shall be removed by delivery of substitute
certificate(s) without such reference if Grantee or Issuer, as
the case may be, shall have delivered to the other party a copy
of a letter from the staff of the Securities and Exchange
Commission, or an opinion of counsel, in form and substance
reasonably satisfactory to the other party, to the effect that
such legend is not required for purposes of the Securities Act or
such laws;
(ii) the reference to the provisions to this
Agreement in the above legend shall be removed by delivery of
substitute certificate(s) without such reference if the shares
have been sold or transferred in compliance with the provisions
of this Agreement and under circumstances that do not require the
retention of such reference; and
(iii) the legend shall be removed in its
entirety if the conditions in the preceding clauses (i) and (ii)
are both satisfied.
In addition, such certificates shall bear any other legend as may
be required by law. Certificates representing shares sold in a
registered public offering pursuant to Section 11 shall not be
required to bear the legend set forth in this Section 13.
14. (a) This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors
and permitted assigns.
(b) Except as expressly provided for in this
Agreement, neither this Agreement nor the rights or obligations
of either party hereto are assignable, except by operation of
law, or with the written consent of the other party.
<PAGE> 108
(c) Nothing contained in this Agreement, express or
implied, is intended to confer upon any person other than the
parties hereto and their respective successors and permitted
assigns any rights or remedies of any nature whatsoever by reason
of this Agreement.
(d) Any Restricted Shares sold by a party in
compliance with the provisions of Section 11 shall, upon
consummation of such sale, be free of the restrictions imposed
with respect to such shares by this Agreement, unless and until
such party shall repurchase or otherwise become the beneficial
owner of such shares, and any transferee of such shares shall not
be entitled to the registration rights of such party.
15. The parties hereto acknowledge that damages would
be an inadequate remedy for a breach of this Agreement by either
party hereto and that the obligations of the parties hereto shall
be enforceable by either party hereto through injunctive or other
equitable relief.
16. If any term, provision, covenant or restriction
contained in this Agreement is held by a court or a federal or
state regulatory agency of competent jurisdiction to be invalid,
void or unenforceable, the remainder of the terms, provisions and
covenants and restrictions contained in this Agreement shall
remain in full force and effect, and shall in no way be affected,
impaired or invalidated. Subject to Section 5, if for any reason
any such court or regulatory agency determines that Grantee is
not permitted to acquire, or Issuer is not permitted to
repurchase pursuant to Section 8, the full number of Option
Shares provided in Section 1 hereof (as the same may be
adjusted), it is the express intention of Issuer to allow Grantee
to acquire or to require Issuer to repurchase such lesser number
of shares as may be permissible without any amendment or
modification hereof.
17. All notices and other communications hereunder
shall be in writing and shall be deemed given if delivered
personally, telecopied (with confirmation), mailed by registered
or certified mail (return receipt requested) or delivered by an
express courier (with confirmation) at the respective addresses
of the parties set forth in the Merger Agreement (or at such
other address for a party as shall be specified by like notice).
18. This Agreement shall be governed by and construed
in accordance with the laws of the State of Wisconsin, regardless
of the laws that might otherwise govern under applicable
principles of conflicts of laws thereof.
19. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original,
but all of which shall constitute one and the same agreement.
<PAGE> 109
20. Except as otherwise expressly provided herein,
each of the parties hereto shall bear and pay all costs and
expenses incurred by it or on its behalf in connection with the
transactions contemplated hereunder, including fees and expenses
of its own financial consultants, investment bankers, accountants
and counsel.
21. Except as otherwise expressly provided herein or
in the Merger Agreement, this Agreement contains the entire
agreement between the parties with respect to the transactions
contemplated hereunder and supersedes all prior arrangements or
understandings with respect thereof, written or oral.
22. This Agreement may be amended by the parties
hereto and the terms and conditions hereof may be waived only by
an instrument in writing signed on behalf of each of the parties
hereto, or, in the case of a waiver, by an instrument signed on
behalf of the party waiving compliance.
23. The time periods for exercises of certain rights
under Sections 2, 5 and 8 shall be extended (but in no event by
more than six months):
(a) to the extent necessary to obtain all regulatory
approvals for the exercise of such rights; and
(b) to the extent necessary to avoid any liability
under Section 16(b) of the Exchange Act by reason of such
exercise.
24. Capitalized terms used in this Agreement and not
defined herein shall have the meanings assigned thereto in the
Merger Agreement.
<PAGE> 110
IN WITNESS WHEREOF, each of the parties has caused this
Agreement to be executed on its behalf by its officers thereunto
duly authorized, all as of the date first above written.
FCB FINANCIAL CORP.
By: /s/ Donald D. Parker
------------------------------
Donald D. Parker
President and Chief Executive
Officer
OSB FINANCIAL CORP.
By:/s/ James J. Rothenbach
------------------------------
James J. Rothenbach
President and Chief Executive
Officer
<PAGE> 111
Exhibit C
PLAN OF MERGER
BETWEEN
FCB FINANCIAL CORP.
AND
OSB FINANCIAL CORP.
PLAN OF MERGER (this "Plan"), dated as of _________
___, 199__, by and between FCB Financial Corp., a Wisconsin
corporation ("FCB"), and OSB Financial Corp., a Wisconsin
corporation ("OSB").
WHEREAS, the Boards of Directors of FCB and OSB have
determined that it is in the best interests of their respective
corporations and their shareholders to consummate a merger in
which OSB will merge with and into FCB (the "Merger"), so that
FCB is the resulting corporation (hereinafter sometimes called
the "Surviving Corporation") in the Merger;
WHEREAS, FCB and OSB have entered into an Agreement and
Plan of Merger, dated November 13, 1996 (the "Agreement"), which
sets forth the terms of the Merger;
WHEREAS, this Plan provides for the terms and
conditions of the Merger and the mode for carrying the Merger
into effect.
NOW, THEREFORE, in consideration of the mutual
covenants and agreements contained herein, and other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties agree as follows:
ARTICLE X
THE MERGER
10.1 THE MERGER. Subject to the terms and conditions
of the Agreement and this Plan, and in accordance with the
Wisconsin Business Corporation Law (the "WBCL"), at the Effective
Time (as defined in Section 1.2), OSB shall merge with and into
FCB, and FCB shall survive the Merger and shall continue its
corporate existence under the laws of the State of Wisconsin.
Upon consummation of the Merger, the separate corporate existence
of OSB shall terminate and the name of the Surviving Corporation
shall be "FCB Financial Corp."
10.2 EFFECTIVE TIME. The Merger shall become effective
upon the later of (a) the time of filing of Articles of Merger
with the Department of Financial Institutions of the State of
Wisconsin (the "Wisconsin Department") and (b) the effective date
and time of the Merger as set forth in such Articles of Merger.
The parties shall each use reasonable efforts to cause Articles
<PAGE> 112
of Merger to be filed on the Closing Date (as defined in Section
1.19). The term "Effective Time" shall be the date and time when
the Merger becomes effective, in accordance with this
Section 1.2.
10.3 EFFECTS OF THE MERGER. At and after the Effective
Time, the Merger shall have the effects set forth in Section
180.1106 of the WBCL.
10.4 CONVERSION OF OSB COMMON STOCK; TREATMENT OF FCB
COMMON STOCK.
*
(a) At the Effective Time, subject to Section
2.2, by virtue of the Merger and without any action on the
part of OSB, or the holder of any securities of OSB, each
share of the common stock, $.01 par value, of OSB (the "OSB
Common Stock") issued and outstanding immediately prior to
the Effective Time (other than shares canceled pursuant to
Section 1.4(c)) shall be converted into the right to receive
1.46 shares (the "OSB Exchange Ratio") of the common stock,
par value $.01 per share, of FCB (the "FCB Common Stock").
(b) All of the shares of OSB Common Stock
converted into FCB Common Stock pursuant to this Article I
shall no longer be outstanding and shall automatically be
canceled and shall cease to exist as of the Effective Time,
and each certificate (each an "OSB Common Stock
Certificate") previously representing any such shares of OSB
Common Stock shall thereafter represent only the right to
receive (i) a certificate representing the number of whole
shares of FCB Common Stock (each an "FCB Common Stock
Certificate") and (ii) cash in lieu of fractional shares
into which the shares of OSB Common Stock previously
represented by such OSB Common Stock Certificate have been
converted pursuant to this Section 1.4 and Section 2.2. OSB
Common Stock Certificates previously representing shares of
OSB Common Stock shall be exchanged for FCB Common Stock
Certificates representing whole shares of FCB Common Stock
and cash in lieu of fractional shares issued in
consideration therefor upon the surrender of such OSB Common
Stock Certificates in accordance with Section 2.2, without
any interest thereon.
(c) At the Effective Time, all shares of OSB
Common Stock that are owned by OSB as treasury stock, owned
by the Oshkosh Savings Bank, FSB Management Development and
Recognition Plan and not allocated to participants
thereunder or owned by FCB, if any, shall be canceled and
shall cease to exist, and no stock of FCB or other
consideration shall be delivered in exchange therefor.
(d) At and after the Effective Time, each share
of FCB Common Stock issued and outstanding immediately prior
<PAGE> 113
to the Effective Time shall remain an issued and outstanding
share of common stock of the Surviving Corporation and shall
not be affected by the Merger.
10.5 ARTICLES OF INCORPORATION. The Articles of
Incorporation of FCB in effect as of the Effective Time shall be
the Articles of Incorporation of the Surviving Corporation after
the Merger until thereafter amended in accordance with applicable
law.
10.6 BY-LAWS. The By-Laws of FCB in effect as of the
Effective Time shall be the By-Laws of the Surviving Corporation
after the Merger until thereafter amended in accordance with
applicable law.
10.7 TAX CONSEQUENCES. It is intended that the Merger
shall constitute a reorganization within the meaning of Section
368(a)(1)(A) of the Internal Revenue Code of 1986, as amended
(the "Code"), and that the Agreement and this Plan shall
constitute a "plan of reorganization" for the purposes of Section
368 of the Code.
10.8 BOARD OF DIRECTORS OF THE SURVIVING CORPORATION.
From and after the Effective Time, the Board of Directors of the
Surviving Corporation shall consist of fourteen (14) persons,
including Donald D. Parker and James J. Rothenbach. Six (6)
directors, in addition to Donald D. Parker, shall have been
selected by FCB ("FCB Representatives"), and six (6) directors,
in addition to James J. Rothenbach, shall have been selected by
OSB (the "OSB Representatives"). The FCB Representatives and the
OSB Representatives, respectively, shall be divided as equally as
practicable among the three classes of directors of the Surviving
Corporation and shall serve in such capacities until their
successors shall have been elected or appointed and shall have
qualified in accordance with the Articles of Incorporation and
By-laws of the Surviving Corporation and the WBCL. Directors
chosen from among the FCB Representatives and the OSB
Representatives shall be equally represented on the personnel
committee (which shall have four members) and the executive
committee, if any, of the Board of Directors of the Surviving
Corporation.
10.9 CLOSING. Subject to the terms and conditions of
the Agreement and this Plan, the closing of the Merger (the
"Closing") will take place at 10:00 a.m. on a date and at a place
to be specified by the parties, which shall be no later than the
first business day in the calendar month immediately following
the month in which the last of the conditions precedent to the
Merger set forth in Article VII of the Agreement is satisfied or
waived, or at such other time, date and place as OSB and FCB
shall mutually agree (the "Closing Date").
<PAGE> 114
ARTICLE XI
CONVERSION OF SHARES
11.1 FCB TO MAKE SHARES AVAILABLE. At or prior to the
Effective Time, FCB shall deposit, or shall cause to be
deposited, with a bank, trust company or other entity reasonably
acceptable to OSB (the "Exchange Agent"), for the benefit of the
holders of OSB Common Stock Certificates, for exchange in
accordance with this Article II, FCB Common Stock Certificates
and cash in lieu of any fractional shares of FCB Common Stock
(such cash and FCB Common Stock Certificates, together with any
dividends or distributions with respect thereto paid after the
Effective Time, being hereinafter referred to as the "Conversion
Fund") to be issued pursuant to Section 1.4 and paid pursuant to
Section 2.2(a) in exchange for outstanding shares of OSB Common
Stock.
11.2 EXCHANGE OF CERTIFICATES.
(a) As soon as practicable after the Effective
Time, and in no event later than ten (10) business days
thereafter, the Surviving Corporation shall cause the
Exchange Agent to mail to each holder of record of one or
more OSB Common Stock Certificates a letter of transmittal
(which shall specify that delivery shall be effected, and
risk of loss and title to the OSB Common Stock Certificates
shall pass, only upon delivery of the OSB Common Stock
Certificates to the Exchange Agent) and instructions for use
in effecting the surrender of the OSB Common Stock
Certificates in exchange for FCB Common Stock Certificates
and any cash in lieu of fractional shares into which the
shares of OSB Common Stock represented by such OSB Common
Stock Certificate or Certificates shall have been converted
pursuant to the Agreement and this Plan. Upon proper
surrender of an OSB Common Stock Certificate for exchange
and cancellation to the Exchange Agent, together with such
properly completed letter of transmittal, duly executed, the
holder of such OSB Common Stock Certificate shall be
entitled to receive in exchange therefor, as applicable, (i)
an FCB Common Stock Certificate representing that number of
whole shares of FCB Common Stock to which such holder of OSB
Common Stock shall have become entitled pursuant to the
provisions of Section 1.4 hereof, and (ii) a check
representing the amount of any cash in lieu of fractional
shares that such holder has the right to receive in respect
of such OSB Common Stock Certificate, and the OSB Common
Stock Certificate so surrendered shall forthwith be
canceled. No interest will be paid or accrued on any cash
in lieu of fractional shares payable to holders of OSB
Common Stock Certificates.
(b) If any FCB Common Stock Certificate is to be
issued in a name other than that in which the OSB Common
<PAGE> 115
Stock Certificate surrendered in exchange therefor is
registered, it shall be a condition of the issuance thereof
that the OSB Common Stock Certificate 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 exchange shall
pay to the Exchange Agent in advance any transfer or other
taxes required by reason of the issuance of an FCB Common
Stock Certificate in any name other than that of the
registered holder of the OSB Common Stock Certificate
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.
(c) After the Effective Time, there shall be no
transfers on the stock transfer books of OSB of the shares
of OSB Common Stock which were issued and outstanding
immediately prior to the Effective Time. If, after the
Effective Time, OSB Common Stock Certificates are presented
for transfer to the Exchange Agent, they shall be canceled
and exchanged for FCB Common Stock Certificates representing
shares of FCB Common Stock as provided in this Article II.
(d) Notwithstanding anything to the contrary
contained herein, no certificates or scrip representing
fractional shares of FCB Common Stock shall be issued upon
the surrender for exchange of OSB Common Stock Certificates,
no dividend or distribution with respect to FCB Common Stock
shall be payable on or with respect to any fractional share,
and such fractional share interests shall not entitle the
owner thereof to vote or to any other rights of a
shareholder of the Surviving Corporation. In lieu of the
issuance of any such fractional share, the Surviving
Corporation shall pay to each former shareholder of OSB who
otherwise would be entitled to receive such fractional share
an amount in cash determined by multiplying (i) the average
of the last sales price for FCB Common Stock as reported on
The Nasdaq Stock Market for the twenty (20) trading days
immediately preceding the fifth trading day prior to the
Closing Date by (ii) the fraction of a share (rounded to the
nearest tenth when expressed as an Arabic number) of FCB
Common Stock to which such holder would otherwise be
entitled to receive pursuant to Section 1.4.
(e) Any portion of the Conversion Fund that
remains unclaimed by the shareholders of OSB for twelve (12)
months after the Effective Time shall be paid to the
Surviving Corporation. Any shareholders of OSB who have not
theretofore complied with this Article II shall thereafter
look only to the Surviving Corporation for the issuance of
certificates representing shares of FCB Common Stock and the
payment of cash in lieu of any fractional shares and any
unpaid dividends and distributions on the FCB Common Stock
<PAGE> 116
deliverable in respect of each share of OSB Common Stock
such shareholder holds as determined pursuant to the
Agreement and this Plan, in each case, without any interest
thereon. Notwithstanding the foregoing, none of FCB, OSB,
the Exchange Agent or any other person shall be liable to
any former holder of shares of OSB Common Stock, for any
amount delivered in good faith to a public official pursuant
to applicable abandoned property, escheat or similar laws.
(f) In the event any OSB Common Stock Certificate
shall have been lost, stolen or destroyed, upon the making
of an affidavit of that fact by the person claiming such OSB
Common Stock Certificate to be lost, stolen or destroyed
and, if reasonably required by the Surviving Corporation,
the posting by such person of a bond in such amount as the
Exchange Agent may determine is reasonably necessary as
indemnity against any claim that may be made against it with
respect to such OSB Common Stock Certificate, the Exchange
Agent will issue in exchange for such lost, stolen or
destroyed Certificate an FCB Common Stock Certificate
representing the shares of FCB Common Stock and any cash in
lieu of fractional shares deliverable in respect thereof
pursuant to the Agreement and this Plan.
ARTICLE XII
SHAREHOLDER APPROVALS
12.1 Each of FCB and OSB shall call a meeting of its
shareholders to be held as soon as reasonably practicable for the
purpose of voting upon the Agreement and this Plan (and, in the
case of FCB, the issuance of shares of FCB Common Stock in the
Merger), and, subject to the terms and conditions of the
Agreement and this Plan, each of FCB and OSB shall use reasonable
efforts to cause such meetings to occur on the same date and each
shall use all reasonable efforts to obtain shareholder approval
of the Agreement, this Plan and the Merger.
ARTICLE XIII
GENERAL PROVISIONS
13.1 TERMINATION. Notwithstanding anything herein to
the contrary, in the event the Agreement shall have been
terminated pursuant to Section 8.1 thereof, this Plan shall
automatically terminate.
13.2 COUNTERPARTS. This Plan may be executed in
counterparts, all of which shall be considered one and the same
agreement and shall become effective when counterparts have been
signed by each of the parties and delivered to the other parties,
it being understood that all parties need not sign the same
counterpart.
<PAGE> 117
13.3 GOVERNING LAW. This Plan shall be governed and
construed in accordance with the laws of the State of Wisconsin,
without regard to any applicable conflicts of law.
13.4 AMENDMENT. Subject to compliance with applicable
law, this Agreement may be amended by the parties hereto, by
action taken or authorized by their respective Boards of
Directors, at any time before or after approval of the matters
presented in connection with the Merger by the shareholders of
FCB or OSB, PROVIDED, HOWEVER, that after any approval of the
transactions contemplated by this Plan by the respective
shareholders of FCB or OSB, there may not be, without further
approval of such shareholders, any amendment of this Plan which
changes the amount or the form of the consideration to be
delivered to the holders of OSB Common Stock hereunder other than
as contemplated by the Agreement and this Plan. This Plan may
not be amended except by an instrument in writing signed on
behalf of each of the parties hereto.
IN WITNESS WHEREOF, FCB and OSB have caused this Plan
to be executed by their respective officers thereunto duly
authorized as of the date first above written.
FCB FINANCIAL CORP. OSB FINANCIAL CORP.
By:/s/ Donald D. Parker By:/s/ James J. Rothenbach
--------------------------- ---------------------------
Name: Donald D. Parker Name: James J. Rothenbach
Title: President and Title: President and
Chief Executive Officer Chief Executive Officer
<PAGE> 118
Exhibit D
DIRECTORS OF THE SURVIVING CORPORATION
Director Company Represented Class
-------- ------------------- -----
Walter H. Drew FCB I
Donald S. Koskinen FCB I
David L. Baston OSB I
Ronald L. Tenpas OSB I
David L. Erdmann FCB II
Donald D. Parker FCB II
William A. Raaths FCB II
David L. Geurden OSB II
David L. Omachinski OSB II
Richard A. Bergstrom FCB III
William J. Schmidt FCB III
Thomas C. Butterbrodt OSB III
Dr. Edwin L. Downing OSB III
James J. Rothenbach OSB III
Class I: Term of office expires at the first annual meeting
of shareholders of the Surviving Corporation
subsequent to the Closing Date.
Class II: Term of office expires at the second annual meeting
of shareholders of the Surviving Corporation
subsequent to the Closing Date.
Class III: Term of office expires at the third annual meeting
of shareholders of the Surviving Corporation
subsequent to the Closing Date.
<PAGE> 119
Exhibit E
LIST OF DIRECTORS AND EXECUTIVE OFFICERS OF THE SURVIVING BANK
Executive Officers of the Surviving Bank
- ----------------------------------------
Name Position
- ---- --------
Donald D. Parker Chairman of the Board of Directors
James J. Rothenbach President and Chief Executive Officer
Phillip J. Schoofs Vice President, Treasurer and Chief
Financial Officer
Harold L. Hermansen Vice President -- Retail Lending and
Secretary
Theodore W. Hoff Vice President -- Retail Sales and
Service
Directors of the Surviving Bank
- -------------------------------
David L. Baston
Richard A. Bergstrom
Thomas C. Butterbrodt
Dr. Edwin L. Downing
Walter H. Drew
David L. Erdmann
David L. Geurden
Donald S. Koskinen
David L. Omachinski
Donald D. Parker
William A. Raaths
James J. Rothenbach
William J. Schmidt
Ronald L. Tenpas
<PAGE> 120
Exhibit F
FORM OF AFFILIATE AGREEMENT
_______________, 19___
FCB Financial Corp.
108 East Wisconsin Avenue
Neenah, Wisconsin 54956
RE: Agreement and Plan of Merger, dated November __, 1996,
between FCB Financial Corp. and OSB Financial Corp.
Gentlemen:
Reference is made to the Agreement and Plan of Merger
(the "Agreement") dated as of November __, 1996, by and between
FCB Financial Corp., a Wisconsin corporation ("FCB"), and OSB
Financial Corp., a Wisconsin corporation ("OSB"), providing for
the merger of OSB with and into FCB (the "Merger") whereby FCB is
the resulting corporation (the "Surviving Corporation"). Under
the terms of the Agreement, all of the outstanding shares of
common stock of OSB, $0.01 par value (the "OSB Common Stock"),
will be converted into shares of common stock of FCB, $0.01 par
value (the "FCB Common Stock").
The undersigned has been advised that the issuance of
shares of FCB Common Stock to the undersigned in connection with
the Merger will be registered with the Securities and Exchange
Commission (the "SEC") under the Securities Act of 1933, as
amended (the "Securities Act"), on a Registration Statement on
Form S-4 and that such registration will not cover any resale or
other disposition of FCB Common Stock. The undersigned also has
been advised that the undersigned may be deemed to be an
affiliate of the Surviving Corporation within the meaning of Rule
145 of the rules and regulations of the SEC under the Securities
Act and that the shares of FCB Common Stock acquired by the
undersigned in connection with the Merger may only be disposed of
in conformity with the provisions hereof.
The undersigned represents and warrants to and
agrees with OSB, FCB and the Surviving Corporation as follows:
(a) The undersigned shall not sell, exchange, transfer
or otherwise dispose of any shares of FCB Common Stock
received by the undersigned in the Merger except (i) at such
time as a registration statement under the Securities Act
covering sales of such FCB Common Stock by the undersigned
is effective, (ii) within the limits, and in accordance with
<PAGE> 121
the applicable provisions of, Rule 145 under the Securities
Act, or (iii) in a transaction which, in the opinion of
counsel for the undersigned or as described in a "no-action"
or interpretive letter from the staff of the SEC, in each
case satisfactory to FCB, is not required to be registered
under the Securities Act. The undersigned acknowledges and
agrees that FCB is under no obligation to register the sale,
transfer or other disposition of such FCB Common Stock by
the undersigned or on his or her behalf, or to take any
other action necessary to make an exemption from
registration available.
(b) FCB shall not be bound by any attempted sale of
any shares of FCB Common Stock by the undersigned, and FCB's
transfer agent shall be given an appropriate stop transfer
order and shall not be required to register any such
attempted sale, unless the sale has been effected in
compliance with the terms of this Letter Agreement. There
will be placed on the certificate representing the shares of
FCB Common Stock issued to the undersigned in the Merger, or
any substitutions therefor, a restrictive legend stating in
substance:
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE
SUBJECT TO THE PROVISIONS OF RULE 145(d), PROMULGATED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY
NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF
WITHOUT COMPLIANCE WITH SAID RULE."
(c) The provisions of paragraphs (a) and (b) hereof
shall also apply to any securities which may be paid as a
dividend or otherwise distributed on or with respect to, or
issued or delivered in exchange or substitution for, shares
of FCB Common Stock received in the Merger by the
undersigned.
(d) The undersigned does not have any present plan or
intention to sell or otherwise dispose of shares of FCB
Common Stock received by the undersigned in the Merger. The
undersigned undertakes to give prompt written notice to FCB,
c/o James J. Rothenbach, President and Chief Executive
Officer, if and as soon as, anytime after the date hereof,
the undersigned has a plan or intention to sell or otherwise
dispose of shares of FCB Common Stock received by the
undersigned in the Merger. [To be included only in those
letters furnished by 5% shareholders]
(e) The undersigned has the capacity to enter into
this Letter Agreement and to make the representations,
warranties and agreements herein, and to perform the
obligations of the undersigned hereunder. This Letter
Agreement constitutes a valid and binding obligation of the
undersigned, enforceable against the undersigned in
<PAGE> 122
accordance with its terms. This Letter Agreement shall be
binding upon, and enforceable against, administrators,
executors, personal representatives, donees, heirs, legatees
and devisees of the undersigned, and any pledgee holding as
collateral any shares of FCB Common Stock issued to the
undersigned in the Merger, and any such person shall be
required to acknowledge in writing the terms of this Letter
Agreement.
FCB agrees that the stop transfer instructions and
legend referred to in paragraph (c) hereof will be promptly
removed upon (i) the sale, exchange, transfer or other
disposition of the FCB Common Stock received in the Merger in
full compliance with the provisions of this Letter Agreement or
(ii) two (2) years after the effective date of the Merger,
provided that, in the latter case, the undersigned is not an
affiliate of FCB and adequate current public information with
respect to the Surviving Corporation is then available, within
the meaning of Rule 144(c) under the Securities Act.
This Letter Agreement shall terminate concurrently with
any termination of the Agreement in accordance with its terms.
Very truly yours,
----------------------------
[Name]
Agreed to and accepted this
___ day of ___________, 199___.
FCB FINANCIAL CORP.
By: _________________________
Title: ______________________
<PAGE> 123
Exhibit G
EMPLOYMENT AGREEMENT
--------------------
THIS EMPLOYMENT AGREEMENT (this "Agreement") is entered
into this ____ day of _____, 1997 between FCB Financial Corp., a
Wisconsin corporation (the "Company"), Fox Cities Bank, F.S.B., a
federal savings bank which is wholly-owned by the Company (the
"Bank") and Donald D. Parker (the "Executive").
WHEREAS, the Company and OSB Financial Corp. ("OSB
Financial") entered into an Agreement and Plan of Merger, dated
_______, 1996 (the "Merger Agreement"), providing for the
combination of the Company and OSB Financial Corp. and a
concurrent combination of the Bank and Oshkosh Savings Bank,
F.S.B. ("OSB Bank") in a strategic merger, wherein the Company
and the Bank survive the merger (collectively, the "Merger");
WHEREAS, prior to the Merger, the Bank employed the
Executive as President and Chief Executive Officer of the Bank;
WHEREAS, consummation of the Merger contemplated by the
Merger Agreement is conditioned upon the Company, the Bank and
the Executive entering into an Employment Agreement conforming to
the terms hereof;
WHEREAS, Executive's skills and extensive experience
and knowledge in the financial institutions industry will
substantially benefit the Company and the Bank; and
WHEREAS, the Company and the Bank desire to retain the
services of Executive in connection with the business activities
of the Company and the Bank following the Merger.
NOW, THEREFORE, in consideration of the foregoing and
of the respective covenants and agreements of the parties herein
contained, it is agreed as follows:
ARTICLE I
EMPLOYMENT
1.1 TERM OF EMPLOYMENT.
The Bank hereby employs Executive for a period commencing on
_______, 1997 (the "Commencement Date") and terminating on
October 31, 1999, subject to earlier termination as provided in
Article II hereof.
1.2 DUTIES OF EXECUTIVE.
The Bank hereby employs Executive, and Executive hereby
accepts employment with the Bank, upon the terms and conditions
<PAGE> 124
hereinafter set forth for the term of this Agreement. Executive
is employed by the Bank to perform the duties of Chairman of the
Board of the Bank, and the Company shall cause the Bank to
appoint Executive to such position. As part of Executive's
employment by the Bank hereunder, Executive shall also serve as,
and the Company hereby appoints Executive during the term of his
employment by the Bank hereunder to serve as, Chairman of the
Board of the Company. The services to be performed by the
Executive shall include those normally performed by the Chairman
of the Board of similar banking organizations and as directed by
the Board of Directors of the Company and the Bank, respectively,
which are not inconsistent with the foregoing. Executive agrees
to devote his full business time to the rendition of such
services, subject to absences for customary vacations and for
temporary illnesses. The Company and the Bank each agree that
during the term of this Agreement it will not reduce the
Executive's current job title, status or responsibilities without
the Executive's consent. Furthermore, Executive shall not be
required, without his express written consent, to be based
anywhere other than within the Oshkosh-Neenah/Menasha-Appleton
metropolitan area, except for reasonable business travel in
connection with the business of the Company and the Bank. During
the term of this Agreement, Executive shall also serve as a
director of the Company (subject to being elected by
shareholders) and the Bank and shall be entitled to receive
applicable director's fees (including fees for committee
meetings) for service as a director of the Company and the Bank.
1.3 COMPENSATION.
The Bank agrees to compensate, and the Company agrees to
cause the Bank to compensate, the Executive for his services
hereunder during the term of this Agreement by payment of a
salary at the annual rate of $139,200 in such monthly, semi-
monthly or other payments as are from time to time applicable to
other executive officers of the Bank. The Executive's salary may
be increased from time to time during the term of this Agreement
in the sole discretion of the Board of Directors of the Bank, but
Executive's salary shall not be reduced below the level then in
effect. In addition, Executive shall be entitled to participate
in incentive compensation plans as may from time to time be
established by the Company or the Bank on an equivalent basis as
other executive officers of the Company or the Bank (but
recognizing differences in responsibilities among executive
officers). All directors and committee meeting fees in respect
to the Company and the Bank received by Executive shall be
included along with his salary for purposes of computing any
amount to which he may become entitled under any bonus or similar
plan of the Company and the Bank.
<PAGE> 125
1.4 BENEFITS.
(a) Executive shall be provided the following additional
benefits, (i) participation in any pension, profit-sharing,
deferred compensation or other retirement plan, (ii) medical,
dental and life insurance coverage consistent with coverages
provided to other executive officers of the Bank (which initially
will include a 30% co-pay by the Executive), (iii) the use of an
automobile and membership or appropriate affiliation with a
service club and a recreational club, (iv) reimbursement of
business expenses reasonably incurred in connection with his
employment and expenses incurred by his spouse when accompanying
Executive, (v) paid vacations and sick leave in accordance with
prevailing policies of the Bank, provided that allowed vacations
shall in no event be less than five weeks per annum, and (vi)
such other benefits as are provided to other executive officers
of the Bank; provided that amounts allocated to Executive's
personal use under clause (iii) above and additional charges for
Executive's spouse pursuant to clause (iv) above shall be treated
as taxable income to Executive in accordance with applicable Bank
policies.
(b) If Executive shall become temporarily disabled or
incapacitated to the extent that he is unable to perform the
duties of Chairman of the Board of the Company or the Bank for
three (3) consecutive months, he shall nevertheless be entitled
to receive 100 percent of his compensation under Section 1.3 of
this Agreement for the period of his disability up to three (3)
months, less any amount paid to the Executive under any other
disability program maintained by the Company or the Bank or
disability insurance policy maintained for the benefit of
Executive by the Company or the Bank. Upon returning to active
full-time employment, Executive's full compensation as set forth
in this Agreement shall be reinstated. In the event that
Executive returns to active employment on other than a full-time
basis with the approval of the Board of Directors of the Bank,
then his compensation (as set forth in Section 1.3 of this
Agreement) shall be reduced proportionately based upon the
fraction of full-time employment devoted by Executive to his
employment and responsibilities at the Bank and the Company.
But, if he is again unable to perform the duties of Chairman of
the Board of the Company and the Bank hereunder due to disability
or incapacity, he must have been engaged in active full-time
employment for at least twelve (12) consecutive months
immediately prior to such later absence or inability in order to
qualify for the full or partial continuance of his salary under
this Section (b).
(c) It is the intention of the Company that, within 30 days
after the date of this Agreement, the Company shall cause 10,000
non-tax-qualified stock options (exercisable for shares of the
Company's common stock) to be granted to Executive. The 10,000
stock options provided for in this Section 1.4(c) shall be
<PAGE> 126
granted by the personnel committee of the Company under the terms
of the Company's 1993 Stock Option and Incentive Plan and shall
vest ratably over a five year period beginning from the date of
their grant and any unvested options shall vest immediately upon
Executive's termination of employment on October 31, 1999.
1.5 COVENANT NOT TO COMPETE.
Executive acknowledges that the Company and the Bank would
be substantially damaged by an association of Executive with a
depository institution that competes for customers with the
Company and the Bank. Without the consent of the Company,
Executive shall not at any time during the term of this Agreement
or Executive's employment by the Bank, and for a period of one
year thereafter (regardless of the reason for termination), (i)
on behalf of himself or as agent of any other person solicit any
person who was a customer of the Company or the Bank or any of
their subsidiaries during the two year period prior to the
termination of this Agreement or Executive's employment hereunder
for the purpose of offering the same products or rendering the
same services to such customer as were provided or proposed to be
provided by the Company or the Bank or any of their subsidiaries
to such customer as of the time of termination of Executive's
employment, (ii) directly or indirectly, on Executive's behalf or
in the service or on the behalf of others, render or be retained
to render similar services as described in Section 1.2 hereof,
whether as an officer, partner, trustee, consultant, or employee
for any depository institution, which has a banking office
located within 10 miles of any office of the Bank or any banking
office of the Company in existence as of the Commencement Date,
provided, however, that Executive shall not be deemed to have
breached this undertaking if (a) he renders services otherwise
prohibited by this paragraph (ii) for a depository institution
which has its home office located outside of the Wisconsin
counties of Winnebago and Outagamie and he renders such services
from a full-service banking office of such depository institution
which is located outside these same Wisconsin counties, or (b)
his sole relationship with any other such entity consists of his
holding, directly or indirectly, an equity interest in such
entity not greater than three percent (3%) of such entity's
outstanding equity interest, or (iii) actively induce or solicit
any employees of the Company or the Bank to leave such employ.
For purposes of this Section 1.5, "person" shall include any
individual, corporation, partnership, trust, firm,
proprietorship, venture or other entity of any nature whatsoever.
ARTICLE II
TERMINATION OF EMPLOYMENT
2.1 VOLUNTARY TERMINATION OF EMPLOYMENT BY EXECUTIVE.
Executive may terminate his employment hereunder at any time
for any reason upon giving the Bank written notice, at least
<PAGE> 127
ninety (90) days prior to termination of employment. Upon such
termination, Executive shall be entitled to receive Executive's
theretofore unpaid base salary in effect at the date such written
notice is given for the period of employment up to the date of
termination, and Executive and his spouse and dependents will be
entitled to further medical coverage, at his and/or their
expense, to the extent required by COBRA.
2.2 TERMINATION OF EMPLOYMENT FOR DEATH.
If Executive's employment is terminated by reason of
Executive's death, then Executive's personal representative shall
be entitled to receive Executive's theretofore unpaid base salary
for the period of employment up to the date of death.
Executive's spouse and dependent children shall continue to be
entitled, at the expense of the Bank (subject to then existing
co-payment features applicable under the Bank's medical insurance
plan) if it is an insured plan, to further medical coverage to
the extent permitted by COBRA; provided that, if the Bank's plan
is not insured, the Bank will pay to Executive's spouse an
additional monthly death benefit during the applicable COBRA
period, based upon COBRA rates in effect at the time of
Executive's death, in an amount equal to the COBRA rate plus
taxes due on such cash payment; provided further that this
benefit shall cease if the spouse and dependents cease to be
eligible for COBRA coverage.
2.3 TERMINATION OF EMPLOYMENT FOR DISABILITY.
If Executive becomes Totally and Permanently Disabled (as
defined below) during the term of this Agreement, the Bank may
terminate Executive's employment and this Agreement, except
Section 1.5 and Article IV hereof, by giving Executive written
notice of such termination not less than 5 days before the
effective date thereof. If Executive's employment and this
Agreement are terminated pursuant to this Section 2.3, the Bank
shall pay to Executive his theretofore unpaid base salary for the
period of employment up to the date of termination, and the
Company and the Bank shall have no further obligations to
Executive under this Agreement, except for any COBRA obligations.
The Executive is Totally and Permanently Disabled for purposes of
this Section 2.3 if he is disabled or incapacitated to the extent
that he is unable to perform the duties of Chairman of the Board
of the Company or the Bank for more than three (3) consecutive
months, and such disability or incapacity (i) is expected to
continue for more than three (3) additional months as certified
by a medical doctor of the Company's choosing which is not
contradicted by a doctor of the Executive's choosing or (ii)
shall have in fact continued for more than three (3) additional
months.
<PAGE> 128
2.4 TERMINATION OF EMPLOYMENT BY THE COMPANY FOR JUST CAUSE.
The Bank may terminate Executive's employment hereunder for
Just Cause (as such term is defined below), in which case the
Executive shall be entitled to receive Executive's theretofore
unpaid base salary for the period of employment up to the date of
termination, but shall not be entitled to any compensation or
employment benefits pursuant to this Agreement for any period
after the date of termination, or the continuation of any
benefits except as may be required by law, including, at his own
expense, COBRA.
"Just Cause" shall mean personal dishonesty, incompetence,
willful misconduct or breach of a fiduciary duty involving
personal profit in the performance of his duties under this
Agreement, intentional failure to perform stated duties (provided
that such nonperformance has continued for 10 days after the Bank
has given written notice of such nonperformance to the Executive
and its intention to terminate Executive's employment hereunder
because of such nonperformance), willful violation of any law,
rule or regulation (other than a law, rule or regulation relating
to a traffic violation or similar offense), final cease-and-
desist order, termination under the provisions of Section 2.7(b)
and (c) or material breach of any provision of this Agreement.
2.5 TERMINATION OF EMPLOYMENT BY THE BANK WITHOUT CAUSE.
The Bank may terminate Executive's employment hereunder
without cause, in which case the Executive shall receive (a) his
base salary under Section 1.3 hereof through the then remaining
term of employment under Section 1.1, (b) his theretofore unpaid
base salary for the period of employment up to the date of
termination, (c) medical, dental and life insurance through the
then remaining term of employment under Section 1.1 consistent
with the terms and conditions set forth in Section 1.4, to the
extent the same can be provided under the insurance arrangements
of the Bank in effect at the time of termination, (d) any other
benefits to which Executive is entitled by law or the specific
terms of the Bank's policies in effect at the time of termination
of employment and (e) an amount equal to the product of the
Bank's annual aggregate contribution, for the benefit of the
Executive in the fiscal year preceding termination, to all
qualified retirement plans in which the Executive participated
multiplied by the number of years in the term of employment under
Section 1.1. The benefit in (e) under this Section 2.5 shall be
in addition to any benefit payable from any qualified or non-
qualified plans or programs maintained by the Company or the Bank
at the time of termination. If the Bank's medical and dental
plans are not insured, the medical and dental benefit in (c)
shall be accomplished by the Bank paying to Executive an
additional cash amount equal to the COBRA premium for such
coverage, plus taxes on such amount, so that Executive may
purchase the coverage on an after-tax basis.
<PAGE> 129
2.6 DEFINITION OF TERMINATION OF EMPLOYMENT.
The terms "termination" or "involuntarily terminated" in
this Agreement shall refer to the termination of the employment
of Executive by the Bank without his express written consent. In
addition, for purposes of this Agreement, a material diminution
or interference with the Executive's duties, responsibilities and
benefits as Chairman of the Board of the Company or the Bank
shall be deemed and shall constitute an involuntary termination
of employment to the same extent as express notice of such
involuntary termination. By way of example and not by way of
limitation, any of the following actions, if unreasonable or
materially adverse to the Executive shall constitute such
diminution or interference unless consented to in writing by the
Executive: (1) a change in the principal work place of the
Executive to a location outside a twenty-five mile radius from
the Company's headquarters at 420 South Koeller Street, Oshkosh,
Wisconsin; (2) a material reduction in the secretarial or other
administrative support of the Executive; (3) a material demotion
of the Executive, a material reduction in the number or seniority
of other Company or Bank personnel reporting to the Executive, or
a reduction in the frequency with which, or in the nature of the
matters with respect to which, such personnel are to report to
the Executive, other than as part of a Company-wide or Bank-wide
reduction in staff; and (4) a reduction or adverse change in the
salary, perquisites, benefits, contingent benefits or vacation
time which had theretofore been provided to the Executive, other
than as part of an overall program applied uniformly and with
equitable effect to all executive officers of the Company or the
Bank.
2.7 TERMINATION OR SUSPENSION OF EMPLOYMENT AS REQUIRED BY LAW.
Notwithstanding anything in this Agreement to the contrary,
the following provisions shall limit the obligation of the Bank
to continue employing Executive, but only to the extent required
by the applicable regulations of the OTS (12 C.F.R. Section
563.39), or similar succeeding regulations:
(a) If the Executive is suspended and/or temporarily
prohibited from participating in the conduct of the Bank's
affairs by a notice served under Section 8(e)(3) or (g)(1) of the
Federal Deposit Insurance Act (12 U.S.C. Section 1818(e)(3) and
(g)(1)) the Bank's obligations under this Agreement shall be
suspended as of the date of service of notice, unless stayed by
appropriate proceedings. If the charges in the notice are
dismissed, the Bank may in its discretion (i) pay the Executive
all or part of the compensation withheld while its contract
obligations hereunder were suspended and (ii) reinstate (in whole
or in part) any of its obligations which were suspended.
(b) If the Executive is removed and/or permanently
prohibited from participating in the conduct of the Bank's
<PAGE> 130
affairs by an order issued under Section 8(e)(4) or (g)(1) of the
Federal Deposit Insurance Act (12 U.S.C. Section 1818(e)(4) or
(g)(1)) all obligations of the Bank under this Agreement shall
terminate as of the effective date of the order.
(c) If the Bank is in default (as defined in Section
3(x)(1) of the Federal Deposit Insurance Act), the obligation to
Executive hereunder shall terminate as of the date of default.
(d) All obligations under this Agreement may be terminated:
(i) by the Director of the Office of Thrift Supervision (the
"Director") or his or her designee at the time the Federal
Deposit Insurance Company enters into an agreement to provide
assistance to or on behalf of the Bank under the authority
contained in Section 13(c) of the Federal Deposit Insurance Act
and (ii) by the Director, or his or her designee at the time the
Director or such designee approves a supervisory merger to
resolve problems related to operation of the Bank or when the
Bank is determined by the Director to be in an unsafe or unsound
condition.
(e) Termination pursuant to subparagraph (d) of this
Section 2.7 shall be treated as a termination by the Bank without
cause entitling Executive to benefits payable under Section 2.5.
Termination pursuant to subparagraph (a), (b) or (c) shall be
treated as a termination for Just Cause under Section 2.4.
Termination under this Section 2.7 shall not affect other rights
hereunder which are vested at the time of termination.
2.8 LIMITATION ON TERMINATION OR DISABILITY PAY.
Any payments made to the Executive pursuant to this
Agreement or otherwise are subject to and conditioned upon their
compliance with 12 U.S.C. Section 1828(k) and any regulations
promulgated thereunder.
ARTICLE III
LEGAL FEES AND EXPENSES
The Company shall pay, or shall cause the Bank to pay, all
legal fees and expenses which the Executive may incur as a result
of the Company or the Bank contesting the validity or
enforceability of this Agreement, provided that the Executive is
the prevailing party in such contest or that any dispute may
otherwise be settled in favor of the Executive. The Executive
shall be entitled to receive interest thereon for the period of
any delay in payment from the date such payment was due at the
rate determined by adding two hundred basis points to the six-
month Treasury Bill rate.
<PAGE> 131
ARTICLE IV
CONFIDENTIALITY
Executive acknowledges that he now has, and in the course of
his employment will have, access to important and confidential
information regarding the business and services of the Company,
the Bank and their subsidiaries, as well as similar information
regarding OSB Financial and its subsidiaries and that the
disclosure to, or the use of such information by, and business in
competition with the Company, the Bank or their subsidiaries
shall result in substantial and undeterminable harm to the
Company, the Bank and their subsidiaries. In order to protect
the Company, the Bank and their subsidiaries against such harm
and from unfair competition, Executive agrees with the Company
and the Bank that while employed by the Bank and at any time
thereafter, Executive will not disclose, communicate or divulge
to anyone, or use in any manner adverse to the Company, the Bank
or their subsidiaries any information concerning customers,
methods of business, financial information or other confidential
information of the Company, the Bank, their subsidiaries or
similar information regarding OSB Financial and its subsidiaries,
except for information as is in the public domain or
ascertainable through common sources of public information
(otherwise than as a result of any breach of this covenant by
Executive).
ARTICLE V
GENERAL PROVISIONS
5.1 INQUIRIES REGARDING PROPOSED ACTIVITIES.
In the event Executive shall inquire in writing of the
Company whether any proposed action on the part of Executive
would be considered by the Company or the Bank to be prohibited
by or in breach of the terms of this Agreement, the Company shall
have 30 days after receipt of such notice to express in writing
to Executive its position with respect thereof and in the event
such writing shall not be given to Executive, such proposed
action, as set forth in the writing of the Executive, shall not
be deemed to be a violation of or breach of this Agreement.
5.2 NO DUTY OF MITIGATION.
The Executive shall not be required to mitigate the amount
of any payment or benefit provided for in this Agreement by
seeking other employment or otherwise, nor shall the amount of
any payment or benefit provided for in this Agreement be reduced
by any compensation earned by the Executive as the result of
employment by another employer, by retirement benefits after the
date of termination of this Agreement or otherwise.
<PAGE> 132
5.3 SUCCESSORS.
This Agreement may be assigned by the Company or the Bank to
any other business entity that is directly or indirectly
controlled by the Company or the Bank. This Agreement may not be
assigned by the Company or the Bank except in connection with a
merger involving the Company or the Bank or a sale of
substantially all of the assets of the Company or the Bank, and
the respective obligations of the Company and the Bank provided
for in this Agreement shall be the binding legal obligations of
any successor to the Company or the Bank by purchase, merger,
consolidation, or otherwise. This Agreement may not be assigned
by the Executive during his life, and upon his death will be
binding upon and inure to the benefit of his heirs, legatees and
the legal representatives of his estate.
5.4 NOTICE.
For the purposes of this Agreement, notices and all other
communications provided for in this Agreement shall be in writing
and shall be deemed to have been duly given when personally
delivered or sent by certified mail, return receipt requested,
postage prepaid, addressed to the respective addresses set forth
on the signature page of this Agreement (provided that all
notices to the Company and the Bank shall be directed to the
attention of the Board of Directors of the Company and/or the
Bank, as the case may be, with a copy to the Secretary of the
Company and/or the Bank, as the case may be), or to such other
address as either party may have furnished to the other in
writing in accordance herewith.
5.5 AMENDMENTS.
No amendment or additions to this Agreement shall be binding
unless in writing and signed by all parties, except as herein
otherwise provided.
5.6 SEVERABILITY.
The provisions of this Agreement shall be deemed severable
and the invalidity or unenforceability of any provision shall not
affect the validity or enforceability of the other provisions
hereof.
5.7 GOVERNING LAW.
This Agreement shall be governed by the laws of the United
States to the extent applicable and otherwise by the internal
laws of the State of Wisconsin.
<PAGE> 133
IN WITNESS WHEREOF, the parties have executed this
Agreement as of the day and year first above written.
FCB FINANCIAL CORP.
By: _______________________________
Its:_______________________________
Address: ___________________
___________________
___________________
FOX CITIES BANK, F.S.B.
By: _______________________________
Its:_______________________________
Address: ___________________
___________________
___________________
EXECUTIVE
_______________________________
Donald D. Parker
Address: ___________________
___________________
___________________
<PAGE> 134
Exhibit H
EMPLOYMENT AGREEMENT
--------------------
THIS EMPLOYMENT AGREEMENT (this "Agreement") is entered
into this ____ day of _____, 1997 between FCB Financial Corp., a
Wisconsin corporation (the "Company"), Fox Cities Bank, F.S.B., a
federal savings bank which is wholly-owned by the Company (the
"Bank") and Phillip J. Schoofs (the "Executive").
WHEREAS, the Company and OSB Financial Corp. ("OSB
Financial") entered into an Agreement and Plan of Merger, dated
_______, 1996 (the "Merger Agreement"), providing for the
combination of the Company and OSB Financial Corp. and a
concurrent combination of the Bank and Oshkosh Savings Bank,
F.S.B. ("OSB Bank") in a strategic merger, wherein the Company
and the Bank survive the merger (collectively, the "Merger");
WHEREAS, prior to the Merger, the Bank employed the
Executive as Vice President - Finance/Treasurer of the Bank;
WHEREAS, consummation of the Merger contemplated by the
Merger Agreement is conditioned upon the Company, the Bank and
the Executive entering into an Employment Agreement conforming to
the terms hereof;
WHEREAS, Executive's skills and extensive experience
and knowledge in the financial institutions industry will
substantially benefit the Company and the Bank; and
WHEREAS, the Company and the Bank desire to retain the
services of Executive in connection with the business activities
of the Company and the Bank following the Merger.
NOW, THEREFORE, in consideration of the foregoing and
of the respective covenants and agreements of the parties herein
contained, it is agreed as follows:
ARTICLE I
EMPLOYMENT
1.1 TERM OF EMPLOYMENT.
The Bank hereby employs Executive for an initial period of
fifteen (15) months commencing on _______, 1997 (the
"Commencement Date") and terminating on ________, 1998 (the
"Initial Termination Date"), subject to earlier termination as
provided in Article II hereof. The Board of Directors of the
Bank shall review and may extend the term of this Agreement for a
period of one (1) additional year beginning on the Initial
Termination Date and in each subsequent year thereafter for a
period of one (1) additional year. Any extensions of the term of
<PAGE> 135
this Agreement shall be made by giving Executive written notice
of such extension at least 90 days prior to the Initial
Termination Date or the expiration of any renewal period.
Reference herein to the term of this Agreement shall refer to
both the initial term and such extended terms.
1.2 DUTIES OF EXECUTIVE.
The Bank hereby employs Executive, and Executive hereby
accepts employment with the Bank, upon the terms and conditions
hereinafter set forth for the term of this Agreement. Executive
is employed by the Bank to perform the duties of Vice President,
Treasurer and Chief Financial Officer of the Bank, and the
Company shall cause the Bank to appoint Executive to such
position. As part of Executive's employment by the Bank
hereunder, Executive shall also serve as, and the Company hereby
appoints Executive during the term of his employment by the Bank
hereunder to serve as, Vice President, Treasurer and Chief
Financial Officer of the Company. The services to be performed
by the Executive shall include those normally performed by the
Vice President, Treasurer and Chief Financial Officer of similar
banking organizations and as directed by the Board of Directors
of the Company and the Bank, respectively, which are not
inconsistent with the foregoing. Executive agrees to devote his
full business time to the rendition of such services, subject to
absences for customary vacations and for temporary illnesses.
The Company and the Bank each agree that during the term of this
Agreement it will not reduce the Executive's current job title,
status or responsibilities without the Executive's consent.
Furthermore, Executive shall not be required, without his express
written consent, to be based anywhere other than within the
Oshkosh-Neenah/Menasha-Appleton metropolitan area, except for
reasonable business travel in connection with the business of the
Company and the Bank.
1.3 COMPENSATION.
The Bank agrees to compensate, and the Company agrees to
cause the Bank to compensate, the Executive for his services
hereunder during the term of this Agreement by payment of a
salary at the annual rate of $75,000 in such monthly, semi-
monthly or other payments as are from time to time applicable to
other executive officers of the Bank. The Executive's salary may
be increased from time to time during the term of this Agreement
in the sole discretion of the Board of Directors of the Bank, but
Executive's salary shall not be reduced below the level then in
effect. In addition, Executive shall be entitled to participate
in incentive compensation plans as may from time to time be
established by the Company or the Bank on an equivalent basis as
other executive officers of the Company or the Bank (but
recognizing differences in responsibilities among executive
officers).
<PAGE> 136
1.4 BENEFITS.
(a) Executive shall be provided the following additional
benefits, (i) participation in any pension, profit-sharing,
deferred compensation or other retirement plan, (ii) medical,
dental and life insurance coverage consistent with coverages
provided to other executive officers of the Bank (which initially
will include a 30% co-pay by the Executive), (iii) membership or
appropriate affiliation with a recreational club, (iv)
reimbursement of business expenses reasonably incurred in
connection with his employment and expenses incurred by his
spouse when accompanying Executive, (v) paid vacations and sick
leave in accordance with prevailing policies of the Bank,
provided that allowed vacations shall in no event be less than
three weeks per annum, and (vi) such other benefits as are
provided to other executive officers of the Bank; provided that
amounts allocated to Executive's personal use under clause (iii)
above and additional charges for Executive's spouse pursuant to
clause (iv) above shall be treated as taxable income to Executive
in accordance with applicable Bank policies.
(b) If Executive shall become temporarily disabled or
incapacitated to the extent that he is unable to perform the
duties of Vice President, Treasurer and Chief Financial Officer
of the Company or the Bank for three (3) consecutive months, he
shall nevertheless be entitled to receive 100 percent of his
compensation under Section 1.3 of this Agreement for the period
of his disability up to three (3) months, less any amount paid to
the Executive under any other disability program maintained by
the Company or the Bank or disability insurance policy maintained
for the benefit of Executive by the Company or the Bank. Upon
returning to active full-time employment, Executive's full
compensation as set forth in this Agreement shall be reinstated.
In the event that Executive returns to active employment on other
than a full-time basis with the approval of the Board of
Directors of the Bank, then his compensation (as set forth in
Section 1.3 of this Agreement) shall be reduced proportionately
based upon the fraction of full-time employment devoted by
Executive to his employment and responsibilities at the Bank and
the Company. But, if he is again unable to perform the duties of
Vice President, Treasurer and Chief Financial Officer of the
Company and the Bank hereunder due to disability or incapacity,
he must have been engaged in active full-time employment for at
least twelve (12) consecutive months immediately prior to such
later absence or inability in order to qualify for the full or
partial continuance of his salary under this Section (b).
(c) It is the intention of the Company that, within 30 days
after the date of this Agreement, the Company shall cause 7,500
non-tax-qualified stock options (exercisable for shares of the
Company's common stock) to be granted to Executive. The 7,500
stock options provided for in this Section 1.4(c) shall be
granted by the personnel committee of the Company under the terms
<PAGE> 137
of the Company's 1993 Stock Option and Incentive Plan and shall
vest ratably over a five year period beginning from the date of
their grant.
1.5 COVENANT NOT TO COMPETE.
Executive acknowledges that the Company and the Bank would
be substantially damaged by an association of Executive with a
depository institution that competes for customers with the
Company and the Bank. Without the consent of the Company,
Executive shall not at any time during the term of this Agreement
or Executive's employment by the Bank, and for a period of one
year thereafter (regardless of the reason for termination), (i)
on behalf of himself or as agent of any other person solicit any
person who was a customer of the Company or the Bank or any of
their subsidiaries during the two year period prior to the
termination of this Agreement or Executive's employment hereunder
for the purpose of offering the same products or rendering the
same services to such customer as were provided or proposed to be
provided by the Company or the Bank or any of their subsidiaries
to such customer as of the time of termination of Executive's
employment, or (ii) actively induce or solicit any employees of
the Company or the Bank to leave such employ. For purposes of
this Section 1.5, "person" shall include any individual,
corporation, partnership, trust, firm, proprietorship, venture or
other entity of any nature whatsoever.
ARTICLE II
TERMINATION OF EMPLOYMENT
2.1 VOLUNTARY TERMINATION OF EMPLOYMENT BY EXECUTIVE.
Executive may terminate his employment hereunder at any time
for any reason upon giving the Bank written notice, at least
ninety (90) days prior to termination of employment. Upon such
termination, Executive shall be entitled to receive Executive's
theretofore unpaid base salary in effect at the date such written
notice is given for the period of employment up to the date of
termination, and Executive and his spouse and dependents will be
entitled to further medical coverage, at his and/or their
expense, to the extent required by COBRA.
2.2 TERMINATION OF EMPLOYMENT FOR DEATH.
If Executive's employment is terminated by reason of
Executive's death, then Executive's personal representative shall
be entitled to receive Executive's theretofore unpaid base salary
for the period of employment up to the date of death.
Executive's spouse and dependent children shall continue to be
entitled, at the expense of the Bank (subject to then existing
co-payment features applicable under the Bank's medical insurance
plan) if it is an insured plan, to further medical coverage to
the extent permitted by COBRA; provided that, if the Bank's plan
<PAGE> 138
is not insured, the Bank will pay to Executive's spouse an
additional monthly death benefit during the applicable COBRA
period, based upon COBRA rates in effect at the time of
Executive's death, in an amount equal to the COBRA rate plus
taxes due on such cash payment; provided further that this
benefit shall cease if the spouse and dependents cease to be
eligible for COBRA coverage.
2.3 TERMINATION OF EMPLOYMENT FOR DISABILITY.
If Executive becomes Totally and Permanently Disabled (as
defined below) during the term of this Agreement, the Bank may
terminate Executive's employment and this Agreement, except
Section 1.5 and Article IV hereof, by giving Executive written
notice of such termination not less than 5 days before the
effective date thereof. If Executive's employment and this
Agreement are terminated pursuant to this Section 2.3, the Bank
shall pay to Executive his theretofore unpaid base salary for the
period of employment up to the date of termination, and the
Company and the Bank shall have no further obligations to
Executive under this Agreement, except for any COBRA obligations.
The Executive is Totally and Permanently Disabled for purposes of
this Section 2.3 if he is disabled or incapacitated to the extent
that he is unable to perform the duties of Vice President,
Treasurer and Chief Financial Officer of the Company or the Bank
for more than three (3) consecutive months, and such disability
or incapacity (i) is expected to continue for more than three (3)
additional months as certified by a medical doctor of the
Company's choosing which is not contradicted by a doctor of the
Executive's choosing or (ii) shall have in fact continued for
more than three (3) additional months.
2.4 TERMINATION OF EMPLOYMENT BY THE COMPANY FOR JUST CAUSE.
The Bank may terminate Executive's employment hereunder for
Just Cause (as such term is defined below), in which case the
Executive shall be entitled to receive Executive's theretofore
unpaid base salary for the period of employment up to the date of
termination, but shall not be entitled to any compensation or
employment benefits pursuant to this Agreement for any period
after the date of termination, or the continuation of any
benefits except as may be required by law, including, at his own
expense, COBRA.
"Just Cause" shall mean personal dishonesty, incompetence,
willful misconduct or breach of a fiduciary duty involving
personal profit in the performance of his duties under this
Agreement, intentional failure to perform stated duties (provided
that such nonperformance has continued for 10 days after the Bank
has given written notice of such nonperformance to the Executive
and its intention to terminate Executive's employment hereunder
because of such nonperformance), willful violation of any law,
rule or regulation (other than a law, rule or regulation relating
<PAGE> 139
to a traffic violation or similar offense), final cease-and-
desist order, termination under the provisions of Section 2.7(b)
and (c) or material breach of any provision of this Agreement.
2.5 TERMINATION OF EMPLOYMENT BY THE BANK WITHOUT CAUSE.
The Bank may terminate Executive's employment hereunder
without cause, in which case the Executive shall receive (a) his
base salary under Section 1.3 hereof through the then remaining
term of employment under Section 1.1, (b) his theretofore unpaid
base salary for the period of employment up to the date of
termination, (c) medical, dental and life insurance through the
then remaining term of employment under Section 1.1 consistent
with the terms and conditions set forth in Section 1.4, to the
extent the same can be provided under the insurance arrangements
of the Bank in effect at the time of termination, (d) any other
benefits to which Executive is entitled by law or the specific
terms of the Bank's policies in effect at the time of termination
of employment and (e) an amount equal to the product of the
Bank's annual aggregate contribution, for the benefit of the
Executive in the fiscal year preceding termination, to all
qualified retirement plans in which the Executive participated
multiplied by the number of years in the initial term of
employment under Section 1.1. The benefit in (e) under this
Section 2.5 shall be in addition to any benefit payable from any
qualified or non-qualified plans or programs maintained by the
Company or the Bank at the time of termination. If the Bank's
medical and dental plans are not insured, the medical and dental
benefit in (c) shall be accomplished by the Bank paying to
Executive an additional cash amount equal to the COBRA premium
for such coverage, plus taxes on such amount, so that Executive
may purchase the coverage on an after-tax basis.
2.6 TERMINATION OF EMPLOYMENT DUE TO CHANGE IN CONTROL.
(a) If, at any time after the date hereof, a "Change in
Control" (as hereinafter defined) occurs and within eighteen (18)
months thereafter Executive's appointment as Vice President,
Treasurer and Chief Financial Officer of the Company or his
employment as Vice President, Treasurer and Chief Financial
Officer of the Bank is involuntarily terminated (other than for
Just Cause pursuant to Section 2.4) then the Executive shall be
entitled to the benefits provided below.
(i) The Company shall promptly pay, or cause the Bank
to pay, to the Executive an amount equal to the product of 2.0
times the Executive's "base amount" as defined in Section
280G(b)(3) of the Code (such "base amount" to be derived from
Executive's compensation paid by the Company and the Bank).
(ii) During the term of this Agreement set forth in
paragraph 1.1 (including any renewal term), the Executive, his
dependents, beneficiaries and estate shall continue to be covered
<PAGE> 140
under all employee benefit plans of the Company and the Bank,
including without limitation the Company's and the Bank's pension
and retirement plans, life insurance and health insurance as if
the Executive was still employed by the Bank during such period
under this Agreement; provided that coverage under the medical
and dental plans of the Company and the Bank shall be handled as
set forth in Section 2.5 above.
(iii) If and to the extent that benefits or
services credit for benefits under Section 2.6(a)(ii) above shall
not be payable or provided under any such plans to the Executive,
his dependents, beneficiaries and estate, by reason of his no
longer being an employee of the Bank as a result of termination
of employment, the Company shall itself, or shall cause the Bank
to, pay or provide for payment of such benefits and service
credit for benefits to the Executive, his dependents,
beneficiaries and estate. Any such payment relating to
retirement shall commence on a date selected by the Executive
which must be a date on which payments under the Company or
Bank's qualified pension plan or successor plan may commence.
(b) (i) Anything in this Agreement to the contrary
notwithstanding, it is the intention of the Company, the Bank and
the Executive that no portion of any payment under this
Agreement, or payments to or for the benefit of the Executive
under any other agreement or plan, be deemed an "Excess Parachute
Payment" as defined in Section 280G of the Code, or its
successors. It is agreed that the present value of any payment
to or for the benefit of the Executive in the nature of
compensation, receipt of which is contingent on the occurrence of
a Change in Control, and to which Section 280G of the Code
applies (in the aggregate "Total Payments") shall not exceed an
amount equal to one dollar less than the maximum amount that the
Company and the Bank may pay without loss of deduction under
Section 280(G)(a) of the Code. Present value for purposes of
this Agreement shall be calculated in accordance with Section
280G(d)(4) of the Code. Within sixty days (60) following the
earlier of (1) the giving of notice of termination of employment
or (2) the giving of notice by the Company to the Executive of
its belief that there is a payment or benefit due the Executive,
the Company, at the Company's expense, shall obtain the opinion
of the Company's public accounting firm (the "Accounting Firm"),
which opinion need not be unqualified, which sets forth: (a) the
amount of the Base Period Income of the Executive (as defined in
Code Section 280G), (b) the present value of Total Payments and
(c) the amount and present value of any Excess Parachute
Payments. In the event that such opinion determines that there
would be an Excess Parachute Payment, the payment hereunder shall
be modified, reduced or eliminated as specified by the Executive
in writing delivered to the Company within thirty (30) days of
his receipt of such opinion or, if the Executive fails to so
notify the Company, then as the Company shall reasonably
determine, so that under the bases of calculation set forth in
<PAGE> 141
such opinion there will be no Excess Parachute Payment. In the
event that the provisions of Sections 280G and 4999 of the Code
are repealed without succession, this Section shall be of no
further force or effect.
(ii) In the event that the Accounting Firm is serving
as accountant or auditor for the individual, entity or group
effecting the Change in Control, the Executive shall appoint
another nationally recognized public accounting firm to make the
determinations required hereunder (which accounting firm shall
then be referred to as the Accounting Firm under Section 2.6(b)).
All fees and expenses of the Accounting Firm shall be borne
solely by the Company. Any determination by the Accounting Firm
shall be binding upon the Company and the Executive.
(c) For purposes of Section 2.6 of this Agreement, a
"Change in Control" shall be deemed to have occurred if:
(i) a third person, including a "group" as defined in
Section 13(d)(3) of the Securities Exchange Act of 1934 (as in
effect on the date hereof), becomes the beneficial owner of
shares of the Company having 20% or more of the total number of
votes that may be cast for the election of directors of the
Company, including for this purpose any shares beneficially owned
by such third person or group as of the date hereof; or
(ii) as the result of, or in connection with, any cash
tender or exchange offer, merger or other business combination,
sale of assets or contested election, or any combination of the
foregoing transactions (a "Transaction"), the persons who were
directors of the Company before the Transaction shall cease to
constitute a majority of the Board of Directors of the Company or
any successor to the Company. (In the event of any
reorganization involving the Company in a transaction initiated
by the Company in which the shareholders of the Company
immediately prior to such reorganization become the shareholders
of a successor or ultimate parent company of the Company
resulting from such reorganization and the persons who were
directors of the Company immediately prior to such reorganization
constitute a majority of the Board of Directors of such successor
or ultimate parent, no "Change in Control" shall be deemed to
have taken place solely by reason of such reorganization,
notwithstanding the fact that the Company may have become the
wholly-owned subsidiary of another Company in such reorganization
and the Board of Directors thereof may have been reconstituted,
and thereafter the term "Company" for purposes of this paragraph
shall refer to such successor or ultimate parent company.); or
(iii) a third person, including a "group" as
defined in Section 13(d)(3) of the Securities Exchange Act of
1934 (as in effect on the date hereof), acquires control, as
defined in 12 C.F.R. Section 574.4, or any successor regulation,
of the Company which would require the filing of an application
<PAGE> 142
for acquisition of control or notice of change in control in a
manner set forth in 12 C.F.R. Section 574.3, or any successor
regulation; or
(iv) The terms "termination" or "involuntarily
terminated" in this Agreement shall refer to the termination of
the employment of Executive by the Bank without his express
written consent. In addition, for purposes of this Agreement, a
material diminution or interference with the Executive's duties,
responsibilities and benefits as Vice President, Treasurer and
Chief Financial Officer of the Company or the Bank shall be
deemed and shall constitute an involuntary termination of
employment to the same extent as express notice of such
involuntary termination. By way of example and not by way of
limitation, any of the following actions, if unreasonable or
materially adverse to the Executive shall constitute such
diminution or interference unless consented to in writing by the
Executive: (1) a change in the principal work place of the
Executive to a location outside a twenty-five mile radius from
the Company's headquarters at 420 South Koeller Street, Oshkosh,
Wisconsin; (2) a material reduction in the secretarial or other
administrative support of the Executive; (3) a material demotion
of the Executive, a material reduction in the number or seniority
of other Company or Bank personnel reporting to the Executive, or
a reduction in the frequency with which, or in the nature of the
matters with respect to which, such personnel are to report to
the Executive, other than as part of a Company-wide or Bank-wide
reduction in staff; and (4) a reduction or adverse change in the
salary, perquisites, benefits, contingent benefits or vacation
time which had theretofore been provided to the Executive, other
than as part of an overall program applied uniformly and with
equitable effect to all executive officers of the Company or the
Bank.
2.7 TERMINATION OR SUSPENSION OF EMPLOYMENT AS REQUIRED BY LAW.
Notwithstanding anything in this Agreement to the contrary,
the following provisions shall limit the obligation of the Bank
to continue employing Executive, but only to the extent required
by the applicable regulations of the OTS (12 C.F.R. Section
563.39), or similar succeeding regulations:
(a) If the Executive is suspended and/or temporarily
prohibited from participating in the conduct of the Bank's
affairs by a notice served under Section 8(e)(3) or (g)(1) of the
Federal Deposit Insurance Act (12 U.S.C. Section 1818(e)(3) and
(g)(1)) the Bank's obligations under this Agreement shall be
suspended as of the date of service of notice, unless stayed by
appropriate proceedings. If the charges in the notice are
dismissed, the Bank may in its discretion (i) pay the Executive
all or part of the compensation withheld while its contract
obligations hereunder were suspended and (ii) reinstate (in whole
or in part) any of its obligations which were suspended.
<PAGE> 143
(b) If the Executive is removed and/or permanently
prohibited from participating in the conduct of the Bank's
affairs by an order issued under Section 8(e)(4) or (g)(1) of the
Federal Deposit Insurance Act (12 U.S.C. Section 1818(e)(4) or
(g)(1)) all obligations of the Bank under this Agreement shall
terminate as of the effective date of the order.
(c) If the Bank is in default (as defined in Section
3(x)(1) of the Federal Deposit Insurance Act), the obligation to
Executive hereunder shall terminate as of the date of default.
(d) All obligations under this Agreement may be terminated:
(i) by the Director of the Office of Thrift Supervision (the
"Director") or his or her designee at the time the Federal
Deposit Insurance Company enters into an agreement to provide
assistance to or on behalf of the Bank under the authority
contained in Section 13(c) of the Federal Deposit Insurance Act
and (ii) by the Director, or his or her designee at the time the
Director or such designee approves a supervisory merger to
resolve problems related to operation of the Bank or when the
Bank is determined by the Director to be in an unsafe or unsound
condition.
(e) Termination pursuant to subparagraph (d) of this
Section 2.7 shall be treated as a termination by the Bank without
cause entitling Executive to benefits payable under Section 2.5.
Termination pursuant to subparagraph (a), (b) or (c) shall be
treated as a termination for Just Cause under Section 2.4.
Termination under this Section 2.7 shall not affect other rights
hereunder which are vested at the time of termination.
2.8 LIMITATION ON TERMINATION OR DISABILITY PAY.
Any payments made to the Executive pursuant to this
Agreement or otherwise are subject to and conditioned upon their
compliance with 12 U.S.C. Section 1828(k) and any regulations
promulgated thereunder.
ARTICLE III
LEGAL FEES AND EXPENSES
The Company shall pay, or shall cause the Bank to pay, all
legal fees and expenses which the Executive may incur as a result
of the Company or the Bank contesting the validity or
enforceability of this Agreement, provided that the Executive is
the prevailing party in such contest or that any dispute may
otherwise be settled in favor of the Executive. The Executive
shall be entitled to receive interest thereon for the period of
any delay in payment from the date such payment was due at the
rate determined by adding two hundred basis points to the six-
month Treasury Bill rate.
<PAGE> 144
ARTICLE IV
CONFIDENTIALITY
Executive acknowledges that he now has, and in the course of
his employment will have, access to important and confidential
information regarding the business and services of the Company,
the Bank and their subsidiaries, as well as similar information
regarding OSB Financial and its subsidiaries, and that the
disclosure to, or the use of such information by, and business in
competition with the Company, the Bank or their subsidiaries
shall result in substantial and undeterminable harm to the
Company, the Bank and their subsidiaries. In order to protect
the Company, the Bank and their subsidiaries against such harm
and from unfair competition, Executive agrees with the Company
and the Bank that while employed by the Bank and at any time
thereafter, Executive will not disclose, communicate or divulge
to anyone, or use in any manner adverse to the Company, the Bank
or their subsidiaries any information concerning customers,
methods of business, financial information or other confidential
information of the Company, the Bank, their subsidiaries or
similar information regarding OSB Financial and its subsidiaries,
except for information as is in the public domain or
ascertainable through common sources of public information
(otherwise than as a result of any breach of this covenant by
Executive).
ARTICLE V
GENERAL PROVISIONS
5.1 INQUIRIES REGARDING PROPOSED ACTIVITIES.
In the event Executive shall inquire in writing of the
Company whether any proposed action on the part of Executive
would be considered by the Company or the Bank to be prohibited
by or in breach of the terms of this Agreement, the Company shall
have 30 days after receipt of such notice to express in writing
to Executive its position with respect thereof and in the event
such writing shall not be given to Executive, such proposed
action, as set forth in the writing of the Executive, shall not
be deemed to be a violation of or breach of this Agreement.
5.2 NO DUTY OF MITIGATION.
The Executive shall not be required to mitigate the amount
of any payment or benefit provided for in this Agreement by
seeking other employment or otherwise, nor shall the amount of
any payment or benefit provided for in this Agreement be reduced
by any compensation earned by the Executive as the result of
employment by another employer, by retirement benefits after the
date of termination of this Agreement or otherwise.
<PAGE> 145
5.3 SUCCESSORS.
This Agreement may be assigned by the Company or the Bank to
any other business entity that is directly or indirectly
controlled by the Company or the Bank. This Agreement may not be
assigned by the Company or the Bank except in connection with a
merger involving the Company or the Bank or a sale of
substantially all of the assets of the Company or the Bank, and
the respective obligations of the Company and the Bank provided
for in this Agreement shall be the binding legal obligations of
any successor to the Company or the Bank by purchase, merger,
consolidation, or otherwise. This Agreement may not be assigned
by the Executive during his life, and upon his death will be
binding upon and inure to the benefit of his heirs, legatees and
the legal representatives of his estate.
5.4 NOTICE.
For the purposes of this Agreement, notices and all other
communications provided for in this Agreement shall be in writing
and shall be deemed to have been duly given when personally
delivered or sent by certified mail, return receipt requested,
postage prepaid, addressed to the respective addresses set forth
on the signature page of this Agreement (provided that all
notices to the Company and the Bank shall be directed to the
attention of the Board of Directors of the Company and/or the
Bank, as the case may be, with a copy to the Secretary of the
Company and/or the Bank, as the case may be), or to such other
address as either party may have furnished to the other in
writing in accordance herewith.
5.5 AMENDMENTS.
No amendment or additions to this Agreement shall be binding
unless in writing and signed by all parties, except as herein
otherwise provided.
5.6 SEVERABILITY.
The provisions of this Agreement shall be deemed severable
and the invalidity or unenforceability of any provision shall not
affect the validity or enforceability of the other provisions
hereof.
5.7 GOVERNING LAW.
This Agreement shall be governed by the laws of the United
States to the extent applicable and otherwise by the internal
laws of the State of Wisconsin.
<PAGE> 146
IN WITNESS WHEREOF, the parties have executed this
Agreement as of the day and year first above written.
FCB FINANCIAL CORP.
By: _______________________________
Its:_______________________________
Address: ____________________
____________________
____________________
FOX CITIES BANK, F.S.B.
By: _______________________________
Its:_______________________________
Address: ____________________
____________________
____________________
EXECUTIVE
_______________________________
Phillip J. Schoofs
Address: ____________________
____________________
____________________
<PAGE> 147
Exhibit I
EMPLOYMENT AGREEMENT
--------------------
THIS EMPLOYMENT AGREEMENT (this "Agreement") is entered
into this ____ day of _____, 1997 between FCB Financial Corp., a
Wisconsin corporation (the "Company"), Fox Cities Bank, F.S.B., a
federal savings bank which is wholly-owned by the Company (the
"Bank") and Harold L. Hermansen (the "Executive").
WHEREAS, the Company and OSB Financial Corp. ("OSB
Financial") entered into an Agreement and Plan of Merger, dated
_______, 1996 (the "Merger Agreement"), providing for the
combination of the Company and OSB Financial Corp. and a
concurrent combination of the Bank and Oshkosh Savings Bank,
F.S.B. ("OSB Bank") in a strategic merger, wherein the Company
and the Bank survive the merger (collectively, the "Merger");
WHEREAS, prior to the Merger, the Bank employed the
Executive as Vice President - Lending/Secretary of the Bank;
WHEREAS, consummation of the Merger contemplated by the
Merger Agreement is conditioned upon the Company, the Bank and
the Executive entering into an Employment Agreement conforming to
the terms hereof;
WHEREAS, Executive's skills and extensive experience
and knowledge in the financial institutions industry will
substantially benefit the Company and the Bank; and
WHEREAS, the Company and the Bank desire to retain the
services of Executive in connection with the business activities
of the Company and the Bank following the Merger.
NOW, THEREFORE, in consideration of the foregoing and
of the respective covenants and agreements of the parties herein
contained, it is agreed as follows:
ARTICLE I
EMPLOYMENT
1.1 TERM OF EMPLOYMENT.
The Bank hereby employs Executive for an initial period of
fifteen (15) months commencing on _______, 1997 (the
"Commencement Date") and terminating on _________, 1998 (the
"Initial Termination Date"), subject to earlier termination as
provided in Article II hereof. The Board of Directors of the
Bank shall review and may extend the term of this Agreement for a
period of one (1) additional year beginning on the Initial
Termination Date and in each subsequent year thereafter for a
period of one (1) additional year. Any extensions of the term of
<PAGE> 148
this Agreement shall be made by giving Executive written notice
of such extension at least 90 days prior to the Initial
Termination Date or the expiration of any renewal period.
Reference herein to the term of this Agreement shall refer to
both the initial term and such extended terms.
1.2 DUTIES OF EXECUTIVE.
The Bank hereby employs Executive, and Executive hereby
accepts employment with the Bank, upon the terms and conditions
hereinafter set forth for the term of this Agreement. Executive
is employed by the Bank to perform the duties of Vice President -
Retail Lending and Secretary of the Bank, and the Company shall
cause the Bank to appoint Executive to such position. As part of
Executive's employment by the Bank hereunder, Executive shall
also serve as, and the Company hereby appoints Executive during
the term of his employment by the Bank hereunder to serve as,
Vice President - Retail Lending and Secretary of the Company.
The services to be performed by the Executive shall include those
normally performed by the Vice President - Retail Lending and
Secretary of similar banking organizations and as directed by the
Board of Directors of the Company and the Bank, respectively,
which are not inconsistent with the foregoing. Executive agrees
to devote his full business time to the rendition of such
services, subject to absences for customary vacations and for
temporary illnesses. The Company and the Bank each agree that
during the term of this Agreement it will not reduce the
Executive's current job title, status or responsibilities without
the Executive's consent. Furthermore, Executive shall not be
required, without his express written consent, to be based
anywhere other than within the Oshkosh-Neenah/Menasha-Appleton
metropolitan area, except for reasonable business travel in
connection with the business of the Company and the Bank.
1.3 COMPENSATION.
The Bank agrees to compensate, and the Company agrees to
cause the Bank to compensate, the Executive for his services
hereunder during the term of this Agreement by payment of a
salary at the annual rate of $70,000 in such monthly, semi-
monthly or other payments as are from time to time applicable to
other executive officers of the Bank. The Executive's salary may
be increased from time to time during the term of this Agreement
in the sole discretion of the Board of Directors of the Bank, but
Executive's salary shall not be reduced below the level then in
effect. In addition, Executive shall be entitled to participate
in incentive compensation plans as may from time to time be
established by the Company or the Bank on an equivalent basis as
other executive officers of the Company or the Bank (but
recognizing differences in responsibilities among executive
officers).
<PAGE> 149
1.4 BENEFITS.
(a) Executive shall be provided the following additional
benefits, (i) participation in any pension, profit-sharing,
deferred compensation or other retirement plan, (ii) medical,
dental and life insurance coverage consistent with coverages
provided to other executive officers of the Bank (which initially
will include a 30% co-pay by the Executive), (iii) membership or
appropriate affiliation with a recreational club, (iv)
reimbursement of business expenses reasonably incurred in
connection with his employment and expenses incurred by his
spouse when accompanying Executive, (v) paid vacations and sick
leave in accordance with prevailing policies of the Bank,
provided that allowed vacations shall in no event be less than
three weeks per annum, and (vi) such other benefits as are
provided to other executive officers of the Bank; provided that
amounts allocated to Executive's personal use under clause (iii)
above and additional charges for Executive's spouse pursuant to
clause (iv) above shall be treated as taxable income to Executive
in accordance with applicable Bank policies.
(b) If Executive shall become temporarily disabled or
incapacitated to the extent that he is unable to perform the
duties of Vice President - Retail Lending and Secretary of the
Company or the Bank for three (3) consecutive months, he shall
nevertheless be entitled to receive 100 percent of his
compensation under Section 1.3 of this Agreement for the period
of his disability up to three (3) months, less any amount paid to
the Executive under any other disability program maintained by
the Company or the Bank or disability insurance policy maintained
for the benefit of Executive by the Company or the Bank. Upon
returning to active full-time employment, Executive's full
compensation as set forth in this Agreement shall be reinstated.
In the event that Executive returns to active employment on other
than a full-time basis with the approval of the Board of
Directors of the Bank, then his compensation (as set forth in
Section 1.3 of this Agreement) shall be reduced proportionately
based upon the fraction of full-time employment devoted by
Executive to his employment and responsibilities at the Bank and
the Company. But, if he is again unable to perform the duties of
Vice President - Retail Lending and Secretary of the Company and
the Bank hereunder due to disability or incapacity, he must have
been engaged in active full-time employment for at least twelve
(12) consecutive months immediately prior to such later absence
or inability in order to qualify for the full or partial
continuance of his salary under this Section (b).
(c) It is the intention of the Company that, within 30 days
after the date of this Agreement, the Company shall cause 6,000
non-tax-qualified stock options (exercisable for shares of the
Company's common stock) to be granted to Executive. The 6,000
stock options provided for in this Section 1.4(c) shall be
granted by the personnel committee of the Company under the terms
<PAGE> 150
of the Company's 1993 Stock Option and Incentive Plan and shall
vest ratably over a five year period beginning from the date of
their grant.
1.5 COVENANT NOT TO COMPETE.
Executive acknowledges that the Company and the Bank would
be substantially damaged by an association of Executive with a
depository institution that competes for customers with the
Company and the Bank. Without the consent of the Company,
Executive shall not at any time during the term of this Agreement
or Executive's employment by the Bank, and for a period of one
year thereafter (regardless of the reason for termination), (i)
on behalf of himself or as agent of any other person solicit any
person who was a customer of the Company or the Bank or any of
their subsidiaries during the two year period prior to the
termination of this Agreement or Executive's employment hereunder
for the purpose of offering the same products or rendering the
same services to such customer as were provided or proposed to be
provided by the Company or the Bank or any of their subsidiaries
to such customer as of the time of termination of Executive's
employment, or (ii) actively induce or solicit any employees of
the Company or the Bank to leave such employ. For purposes of
this Section 1.5, "person" shall include any individual,
corporation, partnership, trust, firm, proprietorship, venture or
other entity of any nature whatsoever.
ARTICLE II
TERMINATION OF EMPLOYMENT
2.1 VOLUNTARY TERMINATION OF EMPLOYMENT BY EXECUTIVE.
Executive may terminate his employment hereunder at any time
for any reason upon giving the Bank written notice, at least
ninety (90) days prior to termination of employment. Upon such
termination, Executive shall be entitled to receive Executive's
theretofore unpaid base salary in effect at the date such written
notice is given for the period of employment up to the date of
termination, and Executive and his spouse and dependents will be
entitled to further medical coverage, at his and/or their
expense, to the extent required by COBRA.
2.2 TERMINATION OF EMPLOYMENT FOR DEATH.
If Executive's employment is terminated by reason of
Executive's death, then Executive's personal representative shall
be entitled to receive Executive's theretofore unpaid base salary
for the period of employment up to the date of death.
Executive's spouse and dependent children shall continue to be
entitled, at the expense of the Bank (subject to then existing
co-payment features applicable under the Bank's medical insurance
plan) if it is an insured plan, to further medical coverage to
the extent permitted by COBRA; provided that, if the Bank's plan
<PAGE> 151
is not insured, the Bank will pay to Executive's spouse an
additional monthly death benefit during the applicable COBRA
period, based upon COBRA rates in effect at the time of
Executive's death, in an amount equal to the COBRA rate plus
taxes due on such cash payment; provided further that this
benefit shall cease if the spouse and dependents cease to be
eligible for COBRA coverage.
2.3 TERMINATION OF EMPLOYMENT FOR DISABILITY.
If Executive becomes Totally and Permanently Disabled (as
defined below) during the term of this Agreement, the Bank may
terminate Executive's employment and this Agreement, except
Section 1.5 and Article IV hereof, by giving Executive written
notice of such termination not less than 5 days before the
effective date thereof. If Executive's employment and this
Agreement are terminated pursuant to this Section 2.3, the Bank
shall pay to Executive his theretofore unpaid base salary for the
period of employment up to the date of termination, and the
Company and the Bank shall have no further obligations to
Executive under this Agreement, except for any COBRA obligations.
The Executive is Totally and Permanently Disabled for purposes of
this Section 2.3 if he is disabled or incapacitated to the extent
that he is unable to perform the duties of Vice President -
Retail Lending and Secretary of the Company or the Bank for more
than three (3) consecutive months, and such disability or
incapacity (i) is expected to continue for more than three (3)
additional months as certified by a medical doctor of the
Company's choosing which is not contradicted by a doctor of the
Executive's choosing or (ii) shall have in fact continued for
more than three (3) additional months.
2.4 TERMINATION OF EMPLOYMENT BY THE COMPANY FOR JUST CAUSE.
The Bank may terminate Executive's employment hereunder for
Just Cause (as such term is defined below), in which case the
Executive shall be entitled to receive Executive's theretofore
unpaid base salary for the period of employment up to the date of
termination, but shall not be entitled to any compensation or
employment benefits pursuant to this Agreement for any period
after the date of termination, or the continuation of any
benefits except as may be required by law, including, at his own
expense, COBRA.
"Just Cause" shall mean personal dishonesty, incompetence,
willful misconduct or breach of a fiduciary duty involving
personal profit in the performance of his duties under this
Agreement, intentional failure to perform stated duties (provided
that such nonperformance has continued for 10 days after the Bank
has given written notice of such nonperformance to the Executive
and its intention to terminate Executive's employment hereunder
because of such nonperformance), willful violation of any law,
rule or regulation (other than a law, rule or regulation relating
<PAGE> 152
to a traffic violation or similar offense), final cease-and-
desist order, termination under the provisions of Section 2.7(b)
and (c) or material breach of any provision of this Agreement.
2.5 TERMINATION OF EMPLOYMENT BY THE BANK WITHOUT CAUSE.
The Bank may terminate Executive's employment hereunder
without cause, in which case the Executive shall receive (a) his
base salary under Section 1.3 hereof through the then remaining
term of employment under Section 1.1, (b) his theretofore unpaid
base salary for the period of employment up to the date of
termination, (c) medical, dental and life insurance through the
then remaining term of employment under Section 1.1 consistent
with the terms and conditions set forth in Section 1.4, to the
extent the same can be provided under the insurance arrangements
of the Bank in effect at the time of termination, (d) any other
benefits to which Executive is entitled by law or the specific
terms of the Bank's policies in effect at the time of termination
of employment and (e) an amount equal to the product of the
Bank's annual aggregate contribution, for the benefit of the
Executive in the fiscal year preceding termination, to all
qualified retirement plans in which the Executive participated
multiplied by the number of years in the initial term of
employment under Section 1.1. The benefit in (e) under this
Section 2.5 shall be in addition to any benefit payable from any
qualified or non-qualified plans or programs maintained by the
Company or the Bank at the time of termination. If the Bank's
medical and dental plans are not insured, the medical and dental
benefit in (c) shall be accomplished by the Bank paying to
Executive an additional cash amount equal to the COBRA premium
for such coverage, plus taxes on such amount, so that Executive
may purchase the coverage on an after-tax basis.
2.6 TERMINATION OF EMPLOYMENT DUE TO CHANGE IN CONTROL.
(a) If, at any time after the date hereof, a "Change in
Control" (as hereinafter defined) occurs and within eighteen (18)
months thereafter Executive's appointment as Vice President -
Retail Lending and Secretary of the Company or his employment as
Vice President - Retail Lending and Secretary of the Bank is
involuntarily terminated (other than for Just Cause pursuant to
Section 2.4) then the Executive shall be entitled to the benefits
provided below.
(i) The Company shall promptly pay, or cause the Bank
to pay, to the Executive an amount equal to the product of 2.0
times the Executive's "base amount" as defined in Section
280G(b)(3) of the Code (such "base amount" to be derived from
Executive's compensation paid by the Company and the Bank).
(ii) During the term of this Agreement set forth in
paragraph 1.1 (including any renewal term), the Executive, his
dependents, beneficiaries and estate shall continue to be covered
<PAGE> 153
under all employee benefit plans of the Company and the Bank,
including without limitation the Company's and the Bank's pension
and retirement plans, life insurance and health insurance as if
the Executive was still employed by the Bank during such period
under this Agreement; provided that coverage under the medical
and dental plans of the Company and the Bank shall be handled as
set forth in Section 2.5 above.
(iii) If and to the extent that benefits or
services credit for benefits under Section 2.6(a)(ii) above shall
not be payable or provided under any such plans to the Executive,
his dependents, beneficiaries and estate, by reason of his no
longer being an employee of the Bank as a result of termination
of employment, the Company shall itself, or shall cause the Bank
to, pay or provide for payment of such benefits and service
credit for benefits to the Executive, his dependents,
beneficiaries and estate. Any such payment relating to
retirement shall commence on a date selected by the Executive
which must be a date on which payments under the Company or
Bank's qualified pension plan or successor plan may commence.
(b) (i) Anything in this Agreement to the contrary
notwithstanding, it is the intention of the Company, the Bank and
the Executive that no portion of any payment under this
Agreement, or payments to or for the benefit of the Executive
under any other agreement or plan, be deemed an "Excess Parachute
Payment" as defined in Section 280G of the Code, or its
successors. It is agreed that the present value of any payment
to or for the benefit of the Executive in the nature of
compensation, receipt of which is contingent on the occurrence of
a Change in Control, and to which Section 280G of the Code
applies (in the aggregate "Total Payments") shall not exceed an
amount equal to one dollar less than the maximum amount that the
Company and the Bank may pay without loss of deduction under
Section 280(G)(a) of the Code. Present value for purposes of
this Agreement shall be calculated in accordance with Section
280G(d)(4) of the Code. Within sixty days (60) following the
earlier of (1) the giving of notice of termination of employment
or (2) the giving of notice by the Company to the Executive of
its belief that there is a payment or benefit due the Executive,
the Company, at the Company's expense, shall obtain the opinion
of the Company's public accounting firm (the "Accounting Firm"),
which opinion need not be unqualified, which sets forth: (a) the
amount of the Base Period Income of the Executive (as defined in
Code Section 280G), (b) the present value of Total Payments and
(c) the amount and present value of any Excess Parachute
Payments. In the event that such opinion determines that there
would be an Excess Parachute Payment, the payment hereunder shall
be modified, reduced or eliminated as specified by the Executive
in writing delivered to the Company within thirty (30) days of
his receipt of such opinion or, if the Executive fails to so
notify the Company, then as the Company shall reasonably
determine, so that under the bases of calculation set forth in
<PAGE> 154
such opinion there will be no Excess Parachute Payment. In the
event that the provisions of Sections 280G and 4999 of the Code
are repealed without succession, this Section shall be of no
further force or effect.
(ii) In the event that the Accounting Firm is serving
as accountant or auditor for the individual, entity or group
effecting the Change in Control, the Executive shall appoint
another nationally recognized public accounting firm to make the
determinations required hereunder (which accounting firm shall
then be referred to as the Accounting Firm under Section 2.6(b)).
All fees and expenses of the Accounting Firm shall be borne
solely by the Company. Any determination by the Accounting Firm
shall be binding upon the Company and the Executive.
(c) For purposes of Section 2.6 of this Agreement, a
"Change in Control" shall be deemed to have occurred if:
(i) a third person, including a "group" as defined in
Section 13(d)(3) of the Securities Exchange Act of 1934 (as in
effect on the date hereof), becomes the beneficial owner of
shares of the Company having 20% or more of the total number of
votes that may be cast for the election of directors of the
Company, including for this purpose any shares beneficially owned
by such third person or group as of the date hereof; or
(ii) as the result of, or in connection with, any cash
tender or exchange offer, merger or other business combination,
sale of assets or contested election, or any combination of the
foregoing transactions (a "Transaction"), the persons who were
directors of the Company before the Transaction shall cease to
constitute a majority of the Board of Directors of the Company or
any successor to the Company. (In the event of any
reorganization involving the Company in a transaction initiated
by the Company in which the shareholders of the Company
immediately prior to such reorganization become the shareholders
of a successor or ultimate parent company of the Company
resulting from such reorganization and the persons who were
directors of the Company immediately prior to such reorganization
constitute a majority of the Board of Directors of such successor
or ultimate parent, no "Change in Control" shall be deemed to
have taken place solely by reason of such reorganization,
notwithstanding the fact that the Company may have become the
wholly-owned subsidiary of another Company in such reorganization
and the Board of Directors thereof may have been reconstituted,
and thereafter the term "Company" for purposes of this paragraph
shall refer to such successor or ultimate parent company.); or
(iii) a third person, including a "group" as
defined in Section 13(d)(3) of the Securities Exchange Act of
1934 (as in effect on the date hereof), acquires control, as
defined in 12 C.F.R. Section 574.4, or any successor regulation,
of the Company which would require the filing of an application
<PAGE> 155
for acquisition of control or notice of change in control in a
manner set forth in 12 C.F.R. Section 574.3, or any successor
regulation; or
(iv) The terms "termination" or "involuntarily
terminated" in this Agreement shall refer to the termination of
the employment of Executive by the Bank without his express
written consent. In addition, for purposes of this Agreement, a
material diminution or interference with the Executive's duties,
responsibilities and benefits as Vice President - Retail Lending
and Secretary of the Company or the Bank shall be deemed and
shall constitute an involuntary termination of employment to the
same extent as express notice of such involuntary termination.
By way of example and not by way of limitation, any of the
following actions, if unreasonable or materially adverse to the
Executive shall constitute such diminution or interference unless
consented to in writing by the Executive: (1) a change in the
principal work place of the Executive to a location outside a
twenty-five mile radius from the Company's headquarters at 420
South Koeller Street, Oshkosh, Wisconsin; (2) a material
reduction in the secretarial or other administrative support of
the Executive; (3) a material demotion of the Executive, a
material reduction in the number or seniority of other Company or
Bank personnel reporting to the Executive, or a reduction in the
frequency with which, or in the nature of the matters with
respect to which, such personnel are to report to the Executive,
other than as part of a Company-wide or Bank-wide reduction in
staff; and (4) a reduction or adverse change in the salary,
perquisites, benefits, contingent benefits or vacation time which
had theretofore been provided to the Executive, other than as
part of an overall program applied uniformly and with equitable
effect to all executive officers of the Company or the Bank.
2.7 TERMINATION OR SUSPENSION OF EMPLOYMENT AS REQUIRED BY LAW.
Notwithstanding anything in this Agreement to the contrary,
the following provisions shall limit the obligation of the Bank
to continue employing Executive, but only to the extent required
by the applicable regulations of the OTS (12 C.F.R. Section
563.39), or similar succeeding regulations:
(a) If the Executive is suspended and/or temporarily
prohibited from participating in the conduct of the Bank's
affairs by a notice served under Section 8(e)(3) or (g)(1) of the
Federal Deposit Insurance Act (12 U.S.C. Section 1818(e)(3) and
(g)(1)) the Bank's obligations under this Agreement shall be
suspended as of the date of service of notice, unless stayed by
appropriate proceedings. If the charges in the notice are
dismissed, the Bank may in its discretion (i) pay the Executive
all or part of the compensation withheld while its contract
obligations hereunder were suspended and (ii) reinstate (in whole
or in part) any of its obligations which were suspended.
<PAGE> 156
(b) If the Executive is removed and/or permanently
prohibited from participating in the conduct of the Bank's
affairs by an order issued under Section 8(e)(4) or (g)(1) of the
Federal Deposit Insurance Act (12 U.S.C. Section 1818(e)(4) or
(g)(1)) all obligations of the Bank under this Agreement shall
terminate as of the effective date of the order.
(c) If the Bank is in default (as defined in Section
3(x)(1) of the Federal Deposit Insurance Act), the obligation to
Executive hereunder shall terminate as of the date of default.
(d) All obligations under this Agreement may be terminated:
(i) by the Director of the Office of Thrift Supervision (the
"Director") or his or her designee at the time the Federal
Deposit Insurance Company enters into an agreement to provide
assistance to or on behalf of the Bank under the authority
contained in Section 13(c) of the Federal Deposit Insurance Act
and (ii) by the Director, or his or her designee at the time the
Director or such designee approves a supervisory merger to
resolve problems related to operation of the Bank or when the
Bank is determined by the Director to be in an unsafe or unsound
condition.
(e) Termination pursuant to subparagraph (d) of this
Section 2.7 shall be treated as a termination by the Bank without
cause entitling Executive to benefits payable under Section 2.5.
Termination pursuant to subparagraph (a), (b) or (c) shall be
treated as a termination for Just Cause under Section 2.4.
Termination under this Section 2.7 shall not affect other rights
hereunder which are vested at the time of termination.
2.8 LIMITATION ON TERMINATION OR DISABILITY PAY.
Any payments made to the Executive pursuant to this
Agreement or otherwise are subject to and conditioned upon their
compliance with 12 U.S.C. Section 1828(k) and any regulations
promulgated thereunder.
ARTICLE III
LEGAL FEES AND EXPENSES
The Company shall pay, or shall cause the Bank to pay, all
legal fees and expenses which the Executive may incur as a result
of the Company or the Bank contesting the validity or
enforceability of this Agreement, provided that the Executive is
the prevailing party in such contest or that any dispute may
otherwise be settled in favor of the Executive. The Executive
shall be entitled to receive interest thereon for the period of
any delay in payment from the date such payment was due at the
rate determined by adding two hundred basis points to the six-
month Treasury Bill rate.
<PAGE> 157
ARTICLE IV
CONFIDENTIALITY
Executive acknowledges that he now has, and in the course of
his employment will have, access to important and confidential
information regarding the business and services of the Company,
the Bank and their subsidiaries, as well as similar information
regarding OSB Financial and its subsidiaries, and that the
disclosure to, or the use of such information by, and business in
competition with the Company, the Bank or their subsidiaries
shall result in substantial and undeterminable harm to the
Company, the Bank and their subsidiaries. In order to protect
the Company, the Bank and their subsidiaries against such harm
and from unfair competition, Executive agrees with the Company
and the Bank that while employed by the Bank and at any time
thereafter, Executive will not disclose, communicate or divulge
to anyone, or use in any manner adverse to the Company, the Bank
or their subsidiaries any information concerning customers,
methods of business, financial information or other confidential
information of the Company, the Bank, their subsidiaries or
similar information regarding OSB Financial and its subsidiaries,
except for information as is in the public domain or
ascertainable through common sources of public information
(otherwise than as a result of any breach of this covenant by
Executive).
ARTICLE V
GENERAL PROVISIONS
5.1 INQUIRIES REGARDING PROPOSED ACTIVITIES.
In the event Executive shall inquire in writing of the
Company whether any proposed action on the part of Executive
would be considered by the Company or the Bank to be prohibited
by or in breach of the terms of this Agreement, the Company shall
have 30 days after receipt of such notice to express in writing
to Executive its position with respect thereof and in the event
such writing shall not be given to Executive, such proposed
action, as set forth in the writing of the Executive, shall not
be deemed to be a violation of or breach of this Agreement.
5.2 NO DUTY OF MITIGATION.
The Executive shall not be required to mitigate the amount
of any payment or benefit provided for in this Agreement by
seeking other employment or otherwise, nor shall the amount of
any payment or benefit provided for in this Agreement be reduced
by any compensation earned by the Executive as the result of
employment by another employer, by retirement benefits after the
date of termination of this Agreement or otherwise.
<PAGE> 158
5.3 SUCCESSORS.
This Agreement may be assigned by the Company or the Bank to
any other business entity that is directly or indirectly
controlled by the Company or the Bank. This Agreement may not be
assigned by the Company or the Bank except in connection with a
merger involving the Company or the Bank or a sale of
substantially all of the assets of the Company or the Bank, and
the respective obligations of the Company and the Bank provided
for in this Agreement shall be the binding legal obligations of
any successor to the Company or the Bank by purchase, merger,
consolidation, or otherwise. This Agreement may not be assigned
by the Executive during his life, and upon his death will be
binding upon and inure to the benefit of his heirs, legatees and
the legal representatives of his estate.
5.4 NOTICE.
For the purposes of this Agreement, notices and all other
communications provided for in this Agreement shall be in writing
and shall be deemed to have been duly given when personally
delivered or sent by certified mail, return receipt requested,
postage prepaid, addressed to the respective addresses set forth
on the signature page of this Agreement (provided that all
notices to the Company and the Bank shall be directed to the
attention of the Board of Directors of the Company and/or the
Bank, as the case may be, with a copy to the Secretary of the
Company and/or the Bank, as the case may be), or to such other
address as either party may have furnished to the other in
writing in accordance herewith.
5.5 AMENDMENTS.
No amendment or additions to this Agreement shall be binding
unless in writing and signed by all parties, except as herein
otherwise provided.
5.6 SEVERABILITY.
The provisions of this Agreement shall be deemed severable
and the invalidity or unenforceability of any provision shall not
affect the validity or enforceability of the other provisions
hereof.
5.7 GOVERNING LAW.
This Agreement shall be governed by the laws of the United
States to the extent applicable and otherwise by the internal
laws of the State of Wisconsin.
<PAGE> 159
IN WITNESS WHEREOF, the parties have executed this
Agreement as of the day and year first above written.
FCB FINANCIAL CORP.
By: _______________________________
Its:_______________________________
Address: ___________________
___________________
___________________
FOX CITIES BANK, F.S.B.
By: _______________________________
Its:_______________________________
Address: ___________________
___________________
___________________
EXECUTIVE
_______________________________
Harold L. Hermansen
Address: ___________________
___________________
___________________
<PAGE> 160
Exhibit J
EMPLOYMENT AGREEMENT
--------------------
THIS EMPLOYMENT AGREEMENT (this "Agreement") is entered
into this ____ day of _____, 1997 between FCB Financial Corp., a
Wisconsin corporation (the "Company"), Fox Cities Bank, F.S.B., a
federal savings bank which is wholly-owned by the Company (the
"Bank") and James J. Rothenbach (the "Executive").
WHEREAS, the Company and OSB Financial Corp. ("OSB
Financial") entered into an Agreement and Plan of Merger, dated
_________, 1996 (the "Merger Agreement"), providing for the
combination of the Company and OSB Financial Corp. and a
concurrent combination of the Bank and Oshkosh Savings Bank,
F.S.B. in a strategic merger, wherein the Company and the Bank
survive the merger (collectively, the "Merger");
WHEREAS, prior to the Merger, OSB Financial employed
the Executive as President and Chief Executive Officer of OSB
Financial under the terms of an employment agreement, dated July
1, 1995;
WHEREAS, consummation of the Merger contemplated by the
Merger Agreement is conditioned upon the Company, the Bank and
the Executive entering into an Employment Agreement conforming to
the terms hereof;
WHEREAS, Executive's skills and extensive experience
and knowledge in the financial institutions industry will
substantially benefit the Company and the Bank; and
WHEREAS, the Company and the Bank desire to retain the
services of Executive in connection with the business activities
of the Company and the Bank following the Merger.
NOW, THEREFORE, in consideration of the foregoing and
of the respective covenants and agreements of the parties herein
contained, it is agreed as follows:
ARTICLE I
EMPLOYMENT
1.1 TERM OF EMPLOYMENT.
The Bank hereby employs Executive for an initial period of
three (3) years commencing on _______, 1997 (the "Commencement
Date") and terminating on ________, 2000 (the "Initial
Termination Date"), subject to earlier termination as provided in
Article II hereof. The Board of Directors of the Bank shall
review and may extend the term of this Agreement for a period of
one (1) additional year beginning on the Initial Termination Date
<PAGE> 161
and in each subsequent year thereafter for a period of one (1)
additional year. Any extensions of the term of this Agreement
shall be made by giving Executive written notice of such
extension at least 90 days prior to the Initial Termination Date
or the expiration of any renewal period. Reference herein to the
term of this Agreement shall refer to both the initial term and
such extended terms.
1.2 DUTIES OF EXECUTIVE.
The Bank hereby employs Executive, and Executive hereby
accepts employment with the Bank, upon the terms and conditions
hereinafter set forth for the term of this Agreement. Executive
is employed by the Bank to perform the duties of President and
Chief Executive Officer of the Bank, and the Company shall cause
the Bank to appoint Executive to such position. As part of
Executive's employment by the Bank hereunder, Executive shall
also serve as, and the Company hereby appoints Executive during
the term of his employment by the Bank hereunder to serve as,
President and Chief Executive officer of the Company. The
services to be performed by the Executive shall include those
normally performed by the President and Chief Executive Officer
of similar banking organizations and as directed by the Board of
Directors of the Company and the Bank, respectively, which are
not inconsistent with the foregoing. Executive agrees to devote
his full business time to the rendition of such services, subject
to absences for customary vacations and for temporary illnesses.
The Company and the Bank each agree that during the term of this
Agreement it will not reduce the Executive's current job title,
status or responsibilities without the Executive's consent.
Furthermore, Executive shall not be required, without his express
written consent, to be based anywhere other than within the
Oshkosh-Neenah/Menasha-Appleton metropolitan area, except for
reasonable business travel in connection with the business of the
Company and the Bank. During the term of this Agreement,
Executive shall also serve as a director of the Company (subject
to being elected by shareholders) and the Bank without any
additional compensation.
1.3 COMPENSATION.
The Bank agrees to compensate, and the Company agrees to
cause the Bank to compensate, the Executive for his services
hereunder during the term of this Agreement by payment of a
salary at the annual rate of $150,000 in such monthly, semi-
monthly or other payments as are from time to time applicable to
other executive officers of the Bank. The Executive's salary may
be increased from time to time during the term of this Agreement
in the sole discretion of the Board of Directors of the Bank, but
Executive's salary shall not be reduced below the level then in
effect. In addition, Executive shall be entitled to participate
in incentive compensation plans as may from time to time be
established by the Company or the Bank on an equivalent basis as
<PAGE> 162
other executive officers of the Company or the Bank (but
recognizing differences in responsibilities among executive
officers).
1.4 BENEFITS.
(a) Executive shall be provided the following additional
benefits, (i) participation in any pension, profit-sharing,
deferred compensation or other retirement plan, (ii) medical,
dental and life insurance coverage consistent with coverages
provided to other executive officers of the Bank (which initially
will include a 30% co-pay by the Executive), (iii) the use of an
automobile and membership or appropriate affiliation with a
service club and a recreational club, (iv) reimbursement of
business expenses reasonably incurred in connection with his
employment and expenses incurred by his spouse when accompanying
Executive, (v) paid vacations and sick leave in accordance with
prevailing policies of the Bank, provided that allowed vacations
shall in no event be less than four weeks per annum, and (vi)
such other benefits as are provided to other executive officers
of the Bank; provided that amounts allocated to Executive's
personal use under clause (iii) above and additional charges for
Executive's spouse pursuant to clause (iv) above shall be treated
as taxable income to Executive in accordance with applicable Bank
policies.
(b) If Executive shall become temporarily disabled or
incapacitated to the extent that he is unable to perform the
duties of President and Chief Executive Officer of the Company or
the Bank for three (3) consecutive months, he shall nevertheless
be entitled to receive 100 percent of his compensation under
Section 1.3 of this Agreement for the period of his disability up
to three (3) months, less any amount paid to the Executive under
any other disability program maintained by the Company or the
Bank or disability insurance policy maintained for the benefit of
Executive by the Company or the Bank. Upon returning to active
full-time employment, Executive's full compensation as set forth
in this Agreement shall be reinstated. In the event that
Executive returns to active employment on other than a full-time
basis with the approval of the Board of Directors of the Bank,
then his compensation (as set forth in Section 1.3 of this
Agreement) shall be reduced proportionately based upon the
fraction of full-time employment devoted by Executive to his
employment and responsibilities at the Bank and the Company.
But, if he is again unable to perform the duties of President and
Chief Executive Officer of the Company and the Bank hereunder due
to disability or incapacity, he must have been engaged in active
full-time employment for at least twelve (12) consecutive months
immediately prior to such later absence or inability in order to
qualify for the full or partial continuance of his salary under
this Section (b).
<PAGE> 163
(c) It is the intention of the Company that, within 30 days
after the date of this Agreement, the Company shall cause 20,000
non-tax-qualified stock options (exercisable for shares of the
Company's common stock) to be granted to Executive. The 20,000
stock options provided for in this Section 1.4(c) shall be
granted by the personnel committee of the Company under the terms
of the Company's 1993 Stock Option and Incentive Plan and shall
vest ratably over a five year period beginning from the date of
their grant.
1.5 COVENANT NOT TO COMPETE.
Executive acknowledges that the Company and the Bank would
be substantially damaged by an association of Executive with a
depository institution that competes for customers with the
Company and the Bank. Without the consent of the Company,
Executive shall not at any time during the term of this Agreement
or Executive's employment by the Bank, and for a period of one
year thereafter (regardless of the reason for termination), (i)
on behalf of himself or as agent of any other person solicit any
person who was a customer of the Company or the Bank or any of
their subsidiaries during the two year period prior to the
termination of this Agreement or Executive's employment hereunder
for the purpose of offering the same products or rendering the
same services to such customer as were provided or proposed to be
provided by the Company or the Bank or any of their subsidiaries
to such customer as of the time of termination of Executive's
employment, (ii) directly or indirectly, on Executive's behalf or
in the service or on the behalf of others, render or be retained
to render similar services as described in Section 1.2 hereof,
whether as an officer, partner, trustee, consultant, or employee
for any depository institution, which has a banking office
located within 10 miles of any office of the Bank or any banking
office of the Company in existence as of the Commencement Date or
the beginning of any renewal period as provided in Section 1.1
hereof, provided, however, that Executive shall not be deemed to
have breached this undertaking if (a) he renders services
otherwise prohibited by this paragraph (ii) for a depository
institution which has its home office located outside of the
Wisconsin counties of Winnebago and Outagamie and he renders such
services from a full-service banking office of such depository
institution which is located outside these same Wisconsin
counties, or (b) his sole relationship with any other such entity
consists of his holding, directly or indirectly, an equity
interest in such entity not greater than three percent (3%) of
such entity's outstanding equity interest, or (iii) actively
induce or solicit any employees of the Company or the Bank to
leave such employ. For purposes of this Section 1.5, "person"
shall include any individual, corporation, partnership, trust,
firm, proprietorship, venture or other entity of any nature
whatsoever.
<PAGE> 164
ARTICLE II
TERMINATION OF EMPLOYMENT
2.1 VOLUNTARY TERMINATION OF EMPLOYMENT BY EXECUTIVE.
Executive may terminate his employment hereunder at any time
for any reason upon giving the Bank written notice, at least
ninety (90) days prior to termination of employment. Upon such
termination, Executive shall be entitled to receive Executive's
theretofore unpaid base salary in effect at the date such written
notice is given for the period of employment up to the date of
termination, and Executive and his spouse and dependents will be
entitled to further medical coverage, at his and/or their
expense, to the extent required by COBRA.
2.2 TERMINATION OF EMPLOYMENT FOR DEATH.
If Executive's employment is terminated by reason of
Executive's death, then Executive's personal representative shall
be entitled to receive Executive's theretofore unpaid base salary
for the period of employment up to the date of death.
Executive's spouse and dependent children shall continue to be
entitled, at the expense of the Bank (subject to then existing
co-payment features applicable under the Bank's medical insurance
plan) if it is an insured plan, to further medical coverage to
the extent permitted by COBRA; provided that, if the Bank's plan
is not insured, the Bank will pay to Executive's spouse an
additional monthly death benefit during the applicable COBRA
period, based upon COBRA rates in effect at the time of
Executive's death, in an amount equal to the COBRA rate plus
taxes due on such cash payment; provided further that this
benefit shall cease if the spouse and dependents cease to be
eligible for COBRA coverage.
2.3 TERMINATION OF EMPLOYMENT FOR DISABILITY.
If Executive becomes Totally and Permanently Disabled (as
defined below) during the term of this Agreement, the Bank may
terminate Executive's employment and this Agreement, except
Section 1.5 and Article IV hereof, by giving Executive written
notice of such termination not less than 5 days before the
effective date thereof. If Executive's employment and this
Agreement are terminated pursuant to this Section 2.3, the Bank
shall pay to Executive his theretofore unpaid base salary for the
period of employment up to the date of termination, and the
Company and the Bank shall have no further obligations to
Executive under this Agreement, except for any COBRA obligations.
The Executive is Totally and Permanently Disabled for purposes of
this Section 2.3 if he is disabled or incapacitated to the extent
that he is unable to perform the duties of President and Chief
Executive Officer of the Company or the Bank for more than three
(3) consecutive months, and such disability or incapacity (i) is
expected to continue for more than three (3) additional months as
<PAGE> 165
certified by a medical doctor of the Company's choosing which is
not contradicted by a doctor of the Executive's choosing or (ii)
shall have in fact continued for more than three (3) additional
months.
2.4 TERMINATION OF EMPLOYMENT BY THE COMPANY FOR JUST CAUSE.
The Bank may terminate Executive's employment hereunder for
Just Cause (as such term is defined below), in which case the
Executive shall be entitled to receive Executive's theretofore
unpaid base salary for the period of employment up to the date of
termination, but shall not be entitled to any compensation or
employment benefits pursuant to this Agreement for any period
after the date of termination, or the continuation of any
benefits except as may be required by law, including, at his own
expense, COBRA.
"Just Cause" shall mean personal dishonesty, incompetence,
willful misconduct or breach of a fiduciary duty involving
personal profit in the performance of his duties under this
Agreement, intentional failure to perform stated duties (provided
that such nonperformance has continued for 10 days after the Bank
has given written notice of such nonperformance to the Executive
and its intention to terminate Executive's employment hereunder
because of such nonperformance), willful violation of any law,
rule or regulation (other than a law, rule or regulation relating
to a traffic violation or similar offense), final cease-and-
desist order, termination under the provisions of Section 2.7(b)
and (c) or material breach of any provision of this Agreement.
2.5 TERMINATION OF EMPLOYMENT BY THE BANK WITHOUT CAUSE.
The Bank may terminate Executive's employment hereunder
without cause, in which case the Executive shall receive (a) his
base salary under Section 1.3 hereof through the then remaining
term of employment under Section 1.1, (b) his theretofore unpaid
base salary for the period of employment up to the date of
termination, (c) medical, dental and life insurance through the
then remaining term of employment under Section 1.1 consistent
with the terms and conditions set forth in Section 1.4, to the
extent the same can be provided under the insurance arrangements
of the Bank in effect at the time of termination, (d) any other
benefits to which Executive is entitled by law or the specific
terms of the Bank's policies in effect at the time of termination
of employment and (e) an amount equal to the product of the
Bank's annual aggregate contribution, for the benefit of the
Executive in the fiscal year preceding termination, to all
qualified retirement plans in which the Executive participated
multiplied by the number of years in the initial term of
employment under Section 1.1. The benefit in (e) under this
Section 2.5 shall be in addition to any benefit payable from any
qualified or non-qualified plans or programs maintained by the
Company or the Bank at the time of termination. If the Bank's
<PAGE> 166
medical and dental plans are not insured, the medical and dental
benefit in (c) shall be accomplished by the Bank paying to
Executive an additional cash amount equal to the COBRA premium
for such coverage, plus taxes on such amount, so that Executive
may purchase the coverage on an after-tax basis.
2.6 TERMINATION OF EMPLOYMENT DUE TO CHANGE IN CONTROL.
(a) If, at any time after the date hereof, a "Change in
Control" (as hereinafter defined) occurs and within eighteen (18)
months thereafter Executive's appointment as President or as
Chief Executive Officer of the Company or his employment as
President or as Chief Executive Officer of the Bank is
involuntarily terminated (other than for Just Cause pursuant to
Section 2.4) then the Executive shall be entitled to the benefits
provided below.
(i) The Company shall promptly pay, or cause the Bank
to pay, to the Executive an amount equal to the product of 2.00
times the Executive's "base amount" as defined in Section
280G(b)(3) of the Code (such "base amount" to be derived from
Executive's compensation paid by the Company and the Bank).
(ii) During the term of this Agreement set forth in
paragraph 1.1 (including any renewal term), the Executive, his
dependents, beneficiaries and estate shall continue to be covered
under all employee benefit plans of the Company and the Bank,
including without limitation the Company's and the Bank's pension
and retirement plans, life insurance and health insurance as if
the Executive was still employed by the Bank during such period
under this Agreement; provided that coverage under the medical
and dental plans of the Company and the Bank shall be handled as
set forth in Section 2.5 above.
(iii) If and to the extent that benefits or
services credit for benefits under Section 2.6(a)(ii) above shall
not be payable or provided under any such plans to the Executive,
his dependents, beneficiaries and estate, by reason of his no
longer being an employee of the Bank as a result of termination
of employment, the Company shall itself, or shall cause the Bank
to, pay or provide for payment of such benefits and service
credit for benefits to the Executive, his dependents,
beneficiaries and estate. Any such payment relating to
retirement shall commence on a date selected by the Executive
which must be a date on which payments under the Company or
Bank's qualified pension plan or successor plan may commence.
(b) (i) Anything in this Agreement to the contrary
notwithstanding, it is the intention of the Company, the Bank and
the Executive that no portion of any payment under this
Agreement, or payments to or for the benefit of the Executive
under any other agreement or plan, be deemed an "Excess Parachute
Payment" as defined in Section 280G of the Code, or its
<PAGE> 167
successors. It is agreed that the present value of any payment
to or for the benefit of the Executive in the nature of
compensation, receipt of which is contingent on the occurrence of
a Change in Control, and to which Section 280G of the Code
applies (in the aggregate "Total Payments") shall not exceed an
amount equal to one dollar less than the maximum amount that the
Company and the Bank may pay without loss of deduction under
Section 280(G)(a) of the Code. Present value for purposes of
this Agreement shall be calculated in accordance with Section
280G(d)(4) of the Code. Within sixty days (60) following the
earlier of (1) the giving of notice of termination of employment
or (2) the giving of notice by the Company to the Executive of
its belief that there is a payment or benefit due the Executive,
the Company, at the Company's expense, shall obtain the opinion
of the Company's public accounting firm (the "Accounting Firm"),
which opinion need not be unqualified, which sets forth: (a) the
amount of the Base Period Income of the Executive (as defined in
Code Section 280G), (b) the present value of Total Payments and
(c) the amount and present value of any Excess Parachute
Payments. In the event that such opinion determines that there
would be an Excess Parachute Payment, the payment hereunder shall
be modified, reduced or eliminated as specified by the Executive
in writing delivered to the Company within thirty (30) days of
his receipt of such opinion or, if the Executive fails to so
notify the Company, then as the Company shall reasonably
determine, so that under the bases of calculation set forth in
such opinion there will be no Excess Parachute Payment. In the
event that the provisions of Sections 280G and 4999 of the Code
are repealed without succession, this Section shall be of no
further force or effect.
(ii) In the event that the Accounting Firm is serving
as accountant or auditor for the individual, entity or group
effecting the Change in Control, the Executive shall appoint
another nationally recognized public accounting firm to make the
determinations required hereunder (which accounting firm shall
then be referred to as the Accounting Firm under Section 2.6(b)).
All fees and expenses of the Accounting Firm shall be borne
solely by the Company. Any determination by the Accounting Firm
shall be binding upon the Company and the Executive.
(c) For purposes of Section 2.6 of this Agreement, a
"Change in Control" shall be deemed to have occurred if:
(i) a third person, including a "group" as defined in
Section 13(d)(3) of the Securities Exchange Act of 1934 (as in
effect on the date hereof), becomes the beneficial owner of
shares of the Company having 20% or more of the total number of
votes that may be cast for the election of directors of the
Company, including for this purpose any shares beneficially owned
by such third person or group as of the date hereof; or
<PAGE> 168
(ii) as the result of, or in connection with, any cash
tender or exchange offer, merger or other business combination,
sale of assets or contested election, or any combination of the
foregoing transactions (a "Transaction"), the persons who were
directors of the Company before the Transaction shall cease to
constitute a majority of the Board of Directors of the Company or
any successor to the Company. (In the event of any
reorganization involving the Company in a transaction initiated
by the Company in which the shareholders of the Company
immediately prior to such reorganization become the shareholders
of a successor or ultimate parent company of the Company
resulting from such reorganization and the persons who were
directors of the Company immediately prior to such reorganization
constitute a majority of the Board of Directors of such successor
or ultimate parent, no "Change in Control" shall be deemed to
have taken place solely by reason of such reorganization,
notwithstanding the fact that the Company may have become the
wholly-owned subsidiary of another Company in such reorganization
and the Board of Directors thereof may have been reconstituted,
and thereafter the term "Company" for purposes of this paragraph
shall refer to such successor or ultimate parent company.); or
(iii) a third person, including a "group" as
defined in Section 13(d)(3) of the Securities Exchange Act of
1934 (as in effect on the date hereof), acquires control, as
defined in 12 C.F.R. Section 574.4, or any successor regulation,
of the Company which would require the filing of an application
for acquisition of control or notice of change in control in a
manner set forth in 12 C.F.R. Section 574.3, or any successor
regulation; or
(iv) The terms "termination" or "involuntarily
terminated" in this Agreement shall refer to the termination of
the employment of Executive by the Bank without his express
written consent. In addition, for purposes of this Agreement, a
material diminution or interference with the Executive's duties,
responsibilities and benefits as President and Chief Executive
Officer of the Company or the Bank shall be deemed and shall
constitute an involuntary termination of employment to the same
extent as express notice of such involuntary termination. By way
of example and not by way of limitation, any of the following
actions, if unreasonable or materially adverse to the Executive
shall constitute such diminution or interference unless consented
to in writing by the Executive: (1) a change in the principal
work place of the Executive to a location outside a twenty-five
mile radius from the Company's headquarters at 420 South Koeller
Street, Oshkosh, Wisconsin; (2) a material reduction in the
secretarial or other administrative support of the Executive; (3)
a material demotion of the Executive, a material reduction in the
number or seniority of other Company or Bank personnel reporting
to the Executive, or a reduction in the frequency with which, or
in the nature of the matters with respect to which, such
personnel are to report to the Executive, other than as part of a
<PAGE> 169
Company-wide or Bank-wide reduction in staff; and (4) a reduction
or adverse change in the salary, perquisites, benefits,
contingent benefits or vacation time which had theretofore been
provided to the Executive, other than as part of an overall
program applied uniformly and with equitable effect to all
executive officers of the Company or the Bank.
2.7 TERMINATION OR SUSPENSION OF EMPLOYMENT AS REQUIRED BY LAW.
Notwithstanding anything in this Agreement to the contrary,
the following provisions shall limit the obligation of the Bank
to continue employing Executive, but only to the extent required
by the applicable regulations of the OTS (12 C.F.R. Section
563.39), or similar succeeding regulations:
(a) If the Executive is suspended and/or temporarily
prohibited from participating in the conduct of the Bank's
affairs by a notice served under Section 8(e)(3) or (g)(1) of the
Federal Deposit Insurance Act (12 U.S.C. Section 1818(e)(3) and
(g)(1)) the Bank's obligations under this Agreement shall be
suspended as of the date of service of notice, unless stayed by
appropriate proceedings. If the charges in the notice are
dismissed, the Bank may in its discretion (i) pay the Executive
all or part of the compensation withheld while its contract
obligations hereunder were suspended and (ii) reinstate (in whole
or in part) any of its obligations which were suspended.
(b) If the Executive is removed and/or permanently
prohibited from participating in the conduct of the Bank's
affairs by an order issued under Section 8(e)(4) or (g)(1) of the
Federal Deposit Insurance Act (12 U.S.C. Section 1818(e)(4) or
(g)(1)) all obligations of the Bank under this Agreement shall
terminate as of the effective date of the order.
(c) If the Bank is in default (as defined in Section
3(x)(1) of the Federal Deposit Insurance Act), the obligation to
Executive hereunder shall terminate as of the date of default.
(d) All obligations under this Agreement may be terminated:
(i) by the Director of the Office of Thrift Supervision (the
"Director") or his or her designee at the time the Federal
Deposit Insurance Company enters into an agreement to provide
assistance to or on behalf of the Bank under the authority
contained in Section 13(c) of the Federal Deposit Insurance Act
and (ii) by the Director, or his or her designee at the time the
Director or such designee approves a supervisory merger to
resolve problems related to operation of the Bank or when the
Bank is determined by the Director to be in an unsafe or unsound
condition.
(e) Termination pursuant to subparagraph (d) of this
Section 2.7 shall be treated as a termination by the Bank without
cause entitling Executive to benefits payable under Section 2.5.
<PAGE> 170
Termination pursuant to subparagraph (a), (b) or (c) shall be
treated as a termination for Just Cause under Section 2.4.
Termination under this Section 2.7 shall not affect other rights
hereunder which are vested at the time of termination.
2.8 LIMITATION ON TERMINATION OR DISABILITY PAY.
Any payments made to the Executive pursuant to this
Agreement or otherwise are subject to and conditioned upon their
compliance with 12 U.S.C. Section 1828(k) and any regulations
promulgated thereunder.
ARTICLE III
LEGAL FEES AND EXPENSES
The Company shall pay, or shall cause the Bank to pay, all
legal fees and expenses which the Executive may incur as a result
of the Company or the Bank contesting the validity or
enforceability of this Agreement, provided that the Executive is
the prevailing party in such contest or that any dispute may
otherwise be settled in favor of the Executive. The Executive
shall be entitled to receive interest thereon for the period of
any delay in payment from the date such payment was due at the
rate determined by adding two hundred basis points to the six-
month Treasury Bill rate.
ARTICLE IV
CONFIDENTIALITY
Executive acknowledges that he now has, and in the course of
his employment will have, access to important and confidential
information regarding the business and services of the Company,
the Bank and their subsidiaries, as well as similar information
regarding OSB Financial and its subsidiaries relating to his
previous employment by that company, and that the disclosure to,
or the use of such information by, and business in competition
with the Company, the Bank or their subsidiaries shall result in
substantial and undeterminable harm to the Company, the Bank and
their subsidiaries. In order to protect the Company, the Bank
and their subsidiaries against such harm and from unfair
competition, Executive agrees with the Company and the Bank that
while employed by the Bank and at any time thereafter, Executive
will not disclose, communicate or divulge to anyone, or use in
any manner adverse to the Company, the Bank or their subsidiaries
any information concerning customers, methods of business,
financial information or other confidential information of the
Company, the Bank, their subsidiaries or similar information
regarding OSB Financial and its subsidiaries, except for
information as is in the public domain or ascertainable through
common sources of public information (otherwise than as a result
of any breach of this covenant by Executive).
<PAGE> 171
ARTICLE V
GENERAL PROVISIONS
5.1 INQUIRIES REGARDING PROPOSED ACTIVITIES.
In the event Executive shall inquire in writing of the
Company whether any proposed action on the part of Executive
would be considered by the Company or the Bank to be prohibited
by or in breach of the terms of this Agreement, the Company shall
have 30 days after receipt of such notice to express in writing
to Executive its position with respect thereof and in the event
such writing shall not be given to Executive, such proposed
action, as set forth in the writing of the Executive, shall not
be deemed to be a violation of or breach of this Agreement.
5.2 NO DUTY OF MITIGATION.
The Executive shall not be required to mitigate the amount
of any payment or benefit provided for in this Agreement by
seeking other employment or otherwise, nor shall the amount of
any payment or benefit provided for in this Agreement be reduced
by any compensation earned by the Executive as the result of
employment by another employer, by retirement benefits after the
date of termination of this Agreement or otherwise.
5.3 SUCCESSORS.
This Agreement may be assigned by the Company or the Bank to
any other business entity that is directly or indirectly
controlled by the Company or the Bank. This Agreement may not be
assigned by the Company or the Bank except in connection with a
merger involving the Company or the Bank or a sale of
substantially all of the assets of the Company or the Bank, and
the respective obligations of the Company and the Bank provided
for in this Agreement shall be the binding legal obligations of
any successor to the Company or the Bank by purchase, merger,
consolidation, or otherwise. This Agreement may not be assigned
by the Executive during his life, and upon his death will be
binding upon and inure to the benefit of his heirs, legatees and
the legal representatives of his estate.
5.4 NOTICE.
For the purposes of this Agreement, notices and all other
communications provided for in this Agreement shall be in writing
and shall be deemed to have been duly given when personally
delivered or sent by certified mail, return receipt requested,
postage prepaid, addressed to the respective addresses set forth
on the signature page of this Agreement (provided that all
notices to the Company and the Bank shall be directed to the
attention of the Board of Directors of the Company and/or the
Bank, as the case may be, with a copy to the Secretary of the
Company and/or the Bank, as the case may be), or to such other
<PAGE> 172
address as either party may have furnished to the other in
writing in accordance herewith.
5.5 AMENDMENTS.
No amendment or additions to this Agreement shall be binding
unless in writing and signed by all parties, except as herein
otherwise provided.
5.6 SEVERABILITY.
The provisions of this Agreement shall be deemed severable
and the invalidity or unenforceability of any provision shall not
affect the validity or enforceability of the other provisions
hereof.
5.7 GOVERNING LAW.
This Agreement shall be governed by the laws of the United
States to the extent applicable and otherwise by the internal
laws of the State of Wisconsin.
<PAGE> 173
IN WITNESS WHEREOF, the parties have executed this
Agreement as of the day and year first above written.
FCB FINANCIAL CORP.
By: _______________________________
Its:_______________________________
Address: ___________________
___________________
___________________
FOX CITIES BANK, F.S.B.
By: _______________________________
Its:_______________________________
Address: ___________________
___________________
___________________
EXECUTIVE
_______________________________
James J. Rothenbach
Address: ___________________
___________________
___________________
<PAGE> 174
Exhibit K
EMPLOYMENT AGREEMENT
--------------------
THIS EMPLOYMENT AGREEMENT (this "Agreement") is entered
into this ____ day of _____, 1997 between FCB Financial Corp., a
Wisconsin corporation (the "Company"), Fox Cities Bank, F.S.B., a
federal savings bank which is wholly-owned by the Company (the
"Bank") and Theodore W. Hoff (the "Executive").
WHEREAS, the Company and OSB Financial Corp. ("OSB
Financial") entered into an Agreement and Plan of Merger, dated
_________, 1996 (the "Merger Agreement"), providing for the
combination of the Company and OSB Financial Corp. and a
concurrent combination of the Bank and Oshkosh Savings Bank,
F.S.B. ("OSB Bank") in a strategic merger, wherein the Company
and the Bank survive the merger (collectively, the "Merger");
WHEREAS, prior to the Merger, OSB Bank employed the
Executive as Vice President - Retail Sales and Service;
WHEREAS, consummation of the Merger contemplated by the
Merger Agreement is conditioned upon the Company, the Bank and
the Executive entering into an Employment Agreement conforming to
the terms hereof;
WHEREAS, Executive's skills and extensive experience
and knowledge in the financial institutions industry will
substantially benefit the Company and the Bank; and
WHEREAS, the Company and the Bank desire to retain the
services of Executive in connection with the business activities
of the Company and the Bank following the Merger.
NOW, THEREFORE, in consideration of the foregoing and
of the respective covenants and agreements of the parties herein
contained, it is agreed as follows:
ARTICLE I
EMPLOYMENT
1.1 TERM OF EMPLOYMENT.
The Bank hereby employs Executive for an initial period of
fifteen (15) months commencing on _______, 1997 (the
"Commencement Date") and terminating on ________, 1998 (the
"Initial Termination Date"), subject to earlier termination as
provided in Article II hereof. The Board of Directors of the
Bank shall review and may extend the term of this Agreement for a
period of one (1) additional year beginning on the Initial
Termination Date and in each subsequent year thereafter for a
period of one (1) additional year. Any extensions of the term of
<PAGE> 175
this Agreement shall be made by giving Executive written notice
of such extension at least 90 days prior to the Initial
Termination Date or the expiration of any renewal period.
Reference herein to the term of this Agreement shall refer to
both the initial term and such extended terms.
1.2 DUTIES OF EXECUTIVE.
The Bank hereby employs Executive, and Executive hereby
accepts employment with the Bank, upon the terms and conditions
hereinafter set forth for the term of this Agreement. Executive
is employed by the Bank to perform the duties of Vice President -
Retail Sales and Service of the Bank, and the Company shall cause
the Bank to appoint Executive to such position. As part of
Executive's employment by the Bank hereunder, Executive shall
also serve as, and the Company hereby appoints Executive during
the term of his employment by the Bank hereunder to serve as Vice
President - Retail Sales and Service of the Company. The
services to be performed by the Executive shall include those
normally performed by Vice President - Retail Sales and Service
of similar banking organizations and as directed by the Board of
Directors of the Company and the Bank, respectively, which are
not inconsistent with the foregoing. Executive agrees to devote
his full business time to the rendition of such services, subject
to absences for customary vacations and for temporary illnesses.
The Company and the Bank each agree that during the term of this
Agreement it will not reduce the Executive's current job title,
status or responsibilities without the Executive's consent.
Furthermore, Executive shall not be required, without his express
written consent, to be based anywhere other than within the
Oshkosh-Neenah/Menasha-Appleton metropolitan area, except for
reasonable business travel in connection with the business of the
Company and the Bank.
1.3 COMPENSATION.
The Bank agrees to compensate, and the Company agrees to
cause the Bank to compensate, the Executive for his services
hereunder during the term of this Agreement by payment of a
salary at the annual rate of $70,000 in such monthly, semi-
monthly or other payments as are from time to time applicable to
other executive officers of the Bank. The Executive's salary may
be increased from time to time during the term of this Agreement
in the sole discretion of the Board of Directors of the Bank, but
Executive's salary shall not be reduced below the level then in
effect. In addition, Executive shall be entitled to participate
in incentive compensation plans as may from time to time be
established by the Company or the Bank on an equivalent basis as
other executive officers of the Company or the Bank (but
recognizing differences in responsibilities among executive
officers).
<PAGE> 176
1.4 BENEFITS.
(a) Executive shall be provided the following additional
benefits, (i) participation in any pension, profit-sharing,
deferred compensation or other retirement plan, (ii) medical,
dental and life insurance coverage consistent with coverages
provided to other executive officers of the Bank (which initially
will include a 30% co-pay by the Executive), (iii) membership or
appropriate affiliation with a recreational club, (iv)
reimbursement of business expenses reasonably incurred in
connection with his employment and expenses incurred by his
spouse when accompanying Executive, (v) paid vacations and sick
leave in accordance with prevailing policies of the Bank,
provided that allowed vacations shall in no event be less than
four weeks per annum, and (vi) such other benefits as are
provided to other executive officers of the Bank; provided that
amounts allocated to Executive's personal use under clause (iii)
above and additional charges for Executive's spouse pursuant to
clause (iv) above shall be treated as taxable income to Executive
in accordance with applicable Bank policies.
(b) If Executive shall become temporarily disabled or
incapacitated to the extent that he is unable to perform the
duties of Vice President - Retail Sales and Service of the
Company or the Bank for three (3) consecutive months, he shall
nevertheless be entitled to receive 100 percent of his
compensation under Section 1.3 of this Agreement for the period
of his disability up to three (3) months, less any amount paid to
the Executive under any other disability program maintained by
the Company or the Bank or disability insurance policy maintained
for the benefit of Executive by the Company or the Bank. Upon
returning to active full-time employment, Executive's full
compensation as set forth in this Agreement shall be reinstated.
In the event that Executive returns to active employment on other
than a full-time basis with the approval of the Board of
Directors of the Bank, then his compensation (as set forth in
Section 1.3 of this Agreement) shall be reduced proportionately
based upon the fraction of full-time employment devoted by
Executive to his employment and responsibilities at the Bank and
the Company. But, if he is again unable to perform the duties of
Vice President - Retail Sales and Service of the Company and the
Bank hereunder due to disability or incapacity, he must have been
engaged in active full-time employment for at least twelve (12)
consecutive months immediately prior to such later absence or
inability in order to qualify for the full or partial continuance
of his salary under this Section (b).
(c) It is the intention of the Company that, within 30 days
after the date of this Agreement, the Company shall cause 6,000
non-tax-qualified stock options (exercisable for shares of the
Company's common stock) to be granted to Executive. The 6,000
stock options provided for in this Section 1.4(c) shall be
granted by the personnel committee of the Company under the terms
<PAGE> 177
of the Company's 1993 Stock Option and Incentive Plan and shall
vest ratably over a five year period beginning from the date of
their grant.
1.5 COVENANT NOT TO COMPETE.
Executive acknowledges that the Company and the Bank would
be substantially damaged by an association of Executive with a
depository institution that competes for customers with the
Company and the Bank. Without the consent of the Company,
Executive shall not at any time during the term of this Agreement
or Executive's employment by the Bank, and for a period of one
year thereafter (regardless of the reason for termination), (i)
on behalf of himself or as agent of any other person solicit any
person who was a customer of the Company or the Bank or any of
their subsidiaries during the two year period prior to the
termination of this Agreement or Executive's employment hereunder
for the purpose of offering the same products or rendering the
same services to such customer as were provided or proposed to be
provided by the Company or the Bank or any of their subsidiaries
to such customer as of the time of termination of Executive's
employment, or (ii) actively induce or solicit any employees of
the Company or the Bank to leave such employ. For purposes of
this Section 1.5, "person" shall include any individual,
corporation, partnership, trust, firm, proprietorship, venture or
other entity of any nature whatsoever.
ARTICLE II
TERMINATION OF EMPLOYMENT
2.1 VOLUNTARY TERMINATION OF EMPLOYMENT BY EXECUTIVE.
Executive may terminate his employment hereunder at any time
for any reason upon giving the Bank written notice, at least
ninety (90) days prior to termination of employment. Upon such
termination, Executive shall be entitled to receive Executive's
theretofore unpaid base salary in effect at the date such written
notice is given for the period of employment up to the date of
termination, and Executive and his spouse and dependents will be
entitled to further medical coverage, at his and/or their
expense, to the extent required by COBRA.
2.2 TERMINATION OF EMPLOYMENT FOR DEATH.
If Executive's employment is terminated by reason of
Executive's death, then Executive's personal representative shall
be entitled to receive Executive's theretofore unpaid base salary
for the period of employment up to the date of death.
Executive's spouse and dependent children shall continue to be
entitled, at the expense of the Bank (subject to then existing
co-payment features applicable under the Bank's medical insurance
plan) if it is an insured plan, to further medical coverage to
the extent permitted by COBRA; provided that, if the Bank's plan
<PAGE> 178
is not insured, the Bank will pay to Executive's spouse an
additional monthly death benefit during the applicable COBRA
period, based upon COBRA rates in effect at the time of
Executive's death, in an amount equal to the COBRA rate plus
taxes due on such cash payment; provided further that this
benefit shall cease if the spouse and dependents cease to be
eligible for COBRA coverage.
2.3 TERMINATION OF EMPLOYMENT FOR DISABILITY.
If Executive becomes Totally and Permanently Disabled (as
defined below) during the term of this Agreement, the Bank may
terminate Executive's employment and this Agreement, except
Section 1.5 and Article IV hereof, by giving Executive written
notice of such termination not less than 5 days before the
effective date thereof. If Executive's employment and this
Agreement are terminated pursuant to this Section 2.3, the Bank
shall pay to Executive his theretofore unpaid base salary for the
period of employment up to the date of termination, and the
Company and the Bank shall have no further obligations to
Executive under this Agreement, except for any COBRA obligations.
The Executive is Totally and Permanently Disabled for purposes of
this Section 2.3 if he is disabled or incapacitated to the extent
that he is unable to perform the duties of Vice President -
Retail Sales and Services of the Company and the Bank for more
than three (3) consecutive months, and such disability or
incapacity (i) is expected to continue for more than three (3)
additional months as certified by a medical doctor of the
Company's choosing which is not contradicted by a doctor of the
Executive's choosing or (ii) shall have in fact continued for
more than three (3) additional months.
2.4 TERMINATION OF EMPLOYMENT BY THE COMPANY FOR JUST CAUSE.
The Bank may terminate Executive's employment hereunder for
Just Cause (as such term is defined below), in which case the
Executive shall be entitled to receive Executive's theretofore
unpaid base salary for the period of employment up to the date of
termination, but shall not be entitled to any compensation or
employment benefits pursuant to this Agreement for any period
after the date of termination, or the continuation of any
benefits except as may be required by law, including, at his own
expense, COBRA.
"Just Cause" shall mean personal dishonesty, incompetence,
willful misconduct or breach of a fiduciary duty involving
personal profit in the performance of his duties under this
Agreement, intentional failure to perform stated duties (provided
that such nonperformance has continued for 10 days after the Bank
has given written notice of such nonperformance to the Executive
and its intention to terminate Executive's employment hereunder
because of such nonperformance), willful violation of any law,
rule or regulation (other than a law, rule or regulation relating
<PAGE> 179
to a traffic violation or similar offense), final cease-and-
desist order, termination under the provisions of Section 2.7(b)
and (c) or material breach of any provision of this Agreement.
2.5 TERMINATION OF EMPLOYMENT BY THE BANK WITHOUT CAUSE.
The Bank may terminate Executive's employment hereunder
without cause, in which case the Executive shall receive (a) his
base salary under Section 1.3 hereof through the then remaining
term of employment under Section 1.1, (b) his theretofore unpaid
base salary for the period of employment up to the date of
termination, (c) medical, dental and life insurance through the
then remaining term of employment under Section 1.1 consistent
with the terms and conditions set forth in Section 1.4, to the
extent the same can be provided under the insurance arrangements
of the Bank in effect at the time of termination, (d) any other
benefits to which Executive is entitled by law or the specific
terms of the Bank's policies in effect at the time of termination
of employment and (e) an amount equal to the product of the
Bank's annual aggregate contribution, for the benefit of the
Executive in the fiscal year preceding termination, to all
qualified retirement plans in which the Executive participated
multiplied by the number of years in the initial term of
employment under Section 1.1. The benefit in (e) under this
Section 2.5 shall be in addition to any benefit payable from any
qualified or non-qualified plans or programs maintained by the
Company or the Bank at the time of termination. If the Bank's
medical and dental plans are not insured, the medical and dental
benefit in (c) shall be accomplished by the Bank paying to
Executive an additional cash amount equal to the COBRA premium
for such coverage, plus taxes on such amount, so that Executive
may purchase the coverage on an after-tax basis.
2.6 TERMINATION OF EMPLOYMENT DUE TO CHANGE IN CONTROL.
(a) If, at any time after the date hereof, a "Change in
Control" (as hereinafter defined) occurs and within eighteen (18)
months thereafter Executive's appointment as Vice President -
Retail Sales and Service of the Company or his employment as Vice
President - Retail Sales and Service of the Bank is involuntarily
terminated (other than for Just Cause pursuant to Section 2.4)
then the Executive shall be entitled to the benefits provided
below.
(i) The Company shall promptly pay, or cause the Bank
to pay, to the Executive an amount equal to the product of 2.0
times the Executive's "base amount" as defined in Section
280G(b)(3) of the Code (such "base amount" to be derived from
Executive's compensation paid by the Company and the Bank).
(ii) During the term of this Agreement set forth in
paragraph 1.1 (including any renewal term), the Executive, his
dependents, beneficiaries and estate shall continue to be covered
<PAGE> 180
under all employee benefit plans of the Company and the Bank,
including without limitation the Company's and the Bank's pension
and retirement plans, life insurance and health insurance as if
the Executive was still employed by the Bank during such period
under this Agreement; provided that coverage under the medical
and dental plans of the Company and the Bank shall be handled as
set forth in Section 2.5 above.
(iii) If and to the extent that benefits or
services credit for benefits under Section 2.6(a)(ii) above shall
not be payable or provided under any such plans to the Executive,
his dependents, beneficiaries and estate, by reason of his no
longer being an employee of the Bank as a result of termination
of employment, the Company shall itself, or shall cause the Bank
to, pay or provide for payment of such benefits and service
credit for benefits to the Executive, his dependents,
beneficiaries and estate. Any such payment relating to
retirement shall commence on a date selected by the Executive
which must be a date on which payments under the Company or
Bank's qualified pension plan or successor plan may commence.
(b) (i) Anything in this Agreement to the contrary
notwithstanding, it is the intention of the Company, the Bank and
the Executive that no portion of any payment under this
Agreement, or payments to or for the benefit of the Executive
under any other agreement or plan, be deemed an "Excess Parachute
Payment" as defined in Section 280G of the Code, or its
successors. It is agreed that the present value of any payment
to or for the benefit of the Executive in the nature of
compensation, receipt of which is contingent on the occurrence of
a Change in Control, and to which Section 280G of the Code
applies (in the aggregate "Total Payments") shall not exceed an
amount equal to one dollar less than the maximum amount that the
Company and the Bank may pay without loss of deduction under
Section 280(G)(a) of the Code. Present value for purposes of
this Agreement shall be calculated in accordance with Section
280G(d)(4) of the Code. Within sixty days (60) following the
earlier of (1) the giving of notice of termination of employment
or (2) the giving of notice by the Company to the Executive of
its belief that there is a payment or benefit due the Executive,
the Company, at the Company's expense, shall obtain the opinion
of the Company's public accounting firm (the "Accounting Firm"),
which opinion need not be unqualified, which sets forth: (a) the
amount of the Base Period Income of the Executive (as defined in
Code Section 280G), (b) the present value of Total Payments and
(c) the amount and present value of any Excess Parachute
Payments. In the event that such opinion determines that there
would be an Excess Parachute Payment, the payment hereunder shall
be modified, reduced or eliminated as specified by the Executive
in writing delivered to the Company within thirty (30) days of
his receipt of such opinion or, if the Executive fails to so
notify the Company, then as the Company shall reasonably
determine, so that under the bases of calculation set forth in
<PAGE> 181
such opinion there will be no Excess Parachute Payment. In the
event that the provisions of Sections 280G and 4999 of the Code
are repealed without succession, this Section shall be of no
further force or effect.
(ii) In the event that the Accounting Firm is serving
as accountant or auditor for the individual, entity or group
effecting the Change in Control, the Executive shall appoint
another nationally recognized public accounting firm to make the
determinations required hereunder (which accounting firm shall
then be referred to as the Accounting Firm under Section 2.6(b)).
All fees and expenses of the Accounting Firm shall be borne
solely by the Company. Any determination by the Accounting Firm
shall be binding upon the Company and the Executive.
(c) For purposes of Section 2.6 of this Agreement, a
"Change in Control" shall be deemed to have occurred if:
(i) a third person, including a "group" as defined in
Section 13(d)(3) of the Securities Exchange Act of 1934 (as in
effect on the date hereof), becomes the beneficial owner of
shares of the Company having 20% or more of the total number of
votes that may be cast for the election of directors of the
Company, including for this purpose any shares beneficially owned
by such third person or group as of the date hereof; or
(ii) as the result of, or in connection with, any cash
tender or exchange offer, merger or other business combination,
sale of assets or contested election, or any combination of the
foregoing transactions (a "Transaction"), the persons who were
directors of the Company before the Transaction shall cease to
constitute a majority of the Board of Directors of the Company or
any successor to the Company. (In the event of any
reorganization involving the Company in a transaction initiated
by the Company in which the shareholders of the Company
immediately prior to such reorganization become the shareholders
of a successor or ultimate parent company of the Company
resulting from such reorganization and the persons who were
directors of the Company immediately prior to such reorganization
constitute a majority of the Board of Directors of such successor
or ultimate parent, no "Change in Control" shall be deemed to
have taken place solely by reason of such reorganization,
notwithstanding the fact that the Company may have become the
wholly-owned subsidiary of another Company in such reorganization
and the Board of Directors thereof may have been reconstituted,
and thereafter the term "Company" for purposes of this paragraph
shall refer to such successor or ultimate parent company.); or
(iii) a third person, including a "group" as
defined in Section 13(d)(3) of the Securities Exchange Act of
1934 (as in effect on the date hereof), acquires control, as
defined in 12 C.F.R. Section 574.4, or any successor regulation,
of the Company which would require the filing of an application
<PAGE> 182
for acquisition of control or notice of change in control in a
manner set forth in 12 C.F.R. Section 574.3, or any successor
regulation; or
(iv) The terms "termination" or "involuntarily
terminated" in this Agreement shall refer to the termination of
the employment of Executive by the Bank without his express
written consent. In addition, for purposes of this Agreement, a
material diminution or interference with the Executive's duties,
responsibilities and benefits as Vice President - Retail Sales
and Service of the Company or the Bank shall be deemed and shall
constitute an involuntary termination of employment to the same
extent as express notice of such involuntary termination. By way
of example and not by way of limitation, any of the following
actions, if unreasonable or materially adverse to the Executive
shall constitute such diminution or interference unless consented
to in writing by the Executive: (1) a change in the principal
work place of the Executive to a location outside a twenty-five
mile radius from the Company's headquarters at 420 South Koeller
Street, Oshkosh, Wisconsin; (2) a material reduction in the
secretarial or other administrative support of the Executive; (3)
a material demotion of the Executive, a material reduction in the
number or seniority of other Company or Bank personnel reporting
to the Executive, or a reduction in the frequency with which, or
in the nature of the matters with respect to which, such
personnel are to report to the Executive, other than as part of a
Company-wide or Bank-wide reduction in staff; and (4) a reduction
or adverse change in the salary, perquisites, benefits,
contingent benefits or vacation time which had theretofore been
provided to the Executive, other than as part of an overall
program applied uniformly and with equitable effect to all
executive officers of the Company or the Bank.
2.7 TERMINATION OR SUSPENSION OF EMPLOYMENT AS REQUIRED BY LAW.
Notwithstanding anything in this Agreement to the contrary,
the following provisions shall limit the obligation of the Bank
to continue employing Executive, but only to the extent required
by the applicable regulations of the OTS (12 C.F.R. Section
563.39), or similar succeeding regulations:
(a) If the Executive is suspended and/or temporarily
prohibited from participating in the conduct of the Bank's
affairs by a notice served under Section 8(e)(3) or (g)(1) of the
Federal Deposit Insurance Act (12 U.S.C. Section 1818(e)(3) and
(g)(1)) the Bank's obligations under this Agreement shall be
suspended as of the date of service of notice, unless stayed by
appropriate proceedings. If the charges in the notice are
dismissed, the Bank may in its discretion (i) pay the Executive
all or part of the compensation withheld while its contract
obligations hereunder were suspended and (ii) reinstate (in whole
or in part) any of its obligations which were suspended.
<PAGE> 183
(b) If the Executive is removed and/or permanently
prohibited from participating in the conduct of the Bank's
affairs by an order issued under Section 8(e)(4) or (g)(1) of the
Federal Deposit Insurance Act (12 U.S.C. Section 1818(e)(4) or
(g)(1)) all obligations of the Bank under this Agreement shall
terminate as of the effective date of the order.
(c) If the Bank is in default (as defined in Section
3(x)(1) of the Federal Deposit Insurance Act), the obligation to
Executive hereunder shall terminate as of the date of default.
(d) All obligations under this Agreement may be terminated:
(i) by the Director of the Office of Thrift Supervision (the
"Director") or his or her designee at the time the Federal
Deposit Insurance Company enters into an agreement to provide
assistance to or on behalf of the Bank under the authority
contained in Section 13(c) of the Federal Deposit Insurance Act
and (ii) by the Director, or his or her designee at the time the
Director or such designee approves a supervisory merger to
resolve problems related to operation of the Bank or when the
Bank is determined by the Director to be in an unsafe or unsound
condition.
(e) Termination pursuant to subparagraph (d) of this
Section 2.7 shall be treated as a termination by the Bank without
cause entitling Executive to benefits payable under Section 2.5.
Termination pursuant to subparagraph (a), (b) or (c) shall be
treated as a termination for Just Cause under Section 2.4.
Termination under this Section 2.7 shall not affect other rights
hereunder which are vested at the time of termination.
2.8 LIMITATION ON TERMINATION OR DISABILITY PAY.
Any payments made to the Executive pursuant to this
Agreement or otherwise are subject to and conditioned upon their
compliance with 12 U.S.C. Section 1828(k) and any regulations
promulgated thereunder.
ARTICLE III
LEGAL FEES AND EXPENSES
The Company shall pay, or shall cause the Bank to pay, all
legal fees and expenses which the Executive may incur as a result
of the Company or the Bank contesting the validity or
enforceability of this Agreement, provided that the Executive is
the prevailing party in such contest or that any dispute may
otherwise be settled in favor of the Executive. The Executive
shall be entitled to receive interest thereon for the period of
any delay in payment from the date such payment was due at the
rate determined by adding two hundred basis points to the six-
month Treasury Bill rate.
<PAGE> 184
ARTICLE IV
CONFIDENTIALITY
Executive acknowledges that he now has, and in the course of
his employment will have, access to important and confidential
information regarding the business and services of the Company,
the Bank and their subsidiaries, as well as similar information
regarding OSB Financial and its subsidiaries relating to his
previous employment by OSB Bank, and that the disclosure to, or
the use of such information by, and business in competition with
the Company, the Bank or their subsidiaries shall result in
substantial and undeterminable harm to the Company, the Bank and
their subsidiaries. In order to protect the Company, the Bank
and their subsidiaries against such harm and from unfair
competition, Executive agrees with the Company and the Bank that
while employed by the Bank and at any time thereafter, Executive
will not disclose, communicate or divulge to anyone, or use in
any manner adverse to the Company, the Bank or their subsidiaries
any information concerning customers, methods of business,
financial information or other confidential information of the
Company, the Bank, their subsidiaries or similar information
regarding OSB Financial and its subsidiaries, except for
information as is in the public domain or ascertainable through
common sources of public information (otherwise than as a result
of any breach of this covenant by Executive).
ARTICLE V
GENERAL PROVISIONS
5.1 INQUIRIES REGARDING PROPOSED ACTIVITIES.
In the event Executive shall inquire in writing of the
Company whether any proposed action on the part of Executive
would be considered by the Company or the Bank to be prohibited
by or in breach of the terms of this Agreement, the Company shall
have 30 days after receipt of such notice to express in writing
to Executive its position with respect thereof and in the event
such writing shall not be given to Executive, such proposed
action, as set forth in the writing of the Executive, shall not
be deemed to be a violation of or breach of this Agreement.
5.2 NO DUTY OF MITIGATION.
The Executive shall not be required to mitigate the amount
of any payment or benefit provided for in this Agreement by
seeking other employment or otherwise, nor shall the amount of
any payment or benefit provided for in this Agreement be reduced
by any compensation earned by the Executive as the result of
employment by another employer, by retirement benefits after the
date of termination of this Agreement or otherwise.
<PAGE> 185
5.3 SUCCESSORS.
This Agreement may be assigned by the Company or the Bank to
any other business entity that is directly or indirectly
controlled by the Company or the Bank. This Agreement may not be
assigned by the Company or the Bank except in connection with a
merger involving the Company or the Bank or a sale of
substantially all of the assets of the Company or the Bank, and
the respective obligations of the Company and the Bank provided
for in this Agreement shall be the binding legal obligations of
any successor to the Company or the Bank by purchase, merger,
consolidation, or otherwise. This Agreement may not be assigned
by the Executive during his life, and upon his death will be
binding upon and inure to the benefit of his heirs, legatees and
the legal representatives of his estate.
5.4 NOTICE.
For the purposes of this Agreement, notices and all other
communications provided for in this Agreement shall be in writing
and shall be deemed to have been duly given when personally
delivered or sent by certified mail, return receipt requested,
postage prepaid, addressed to the respective addresses set forth
on the signature page of this Agreement (provided that all
notices to the Company and the Bank shall be directed to the
attention of the Board of Directors of the Company and/or the
Bank, as the case may be, with a copy to the Secretary of the
Company and/or the Bank, as the case may be), or to such other
address as either party may have furnished to the other in
writing in accordance herewith.
5.5 AMENDMENTS.
No amendment or additions to this Agreement shall be binding
unless in writing and signed by all parties, except as herein
otherwise provided.
5.6 SEVERABILITY.
The provisions of this Agreement shall be deemed severable
and the invalidity or unenforceability of any provision shall not
affect the validity or enforceability of the other provisions
hereof.
5.7 GOVERNING LAW.
This Agreement shall be governed by the laws of the United
States to the extent applicable and otherwise by the internal
laws of the State of Wisconsin.
<PAGE> 186
IN WITNESS WHEREOF, the parties have executed this
Agreement as of the day and year first above written.
FCB FINANCIAL CORP.
By: _______________________________
Its:_______________________________
Address: ______________________
______________________
______________________
FOX CITIES BANK, F.S.B.
By: _______________________________
Its:_______________________________
Address: ______________________
______________________
______________________
EXECUTIVE
_______________________________
Theodore W. Hoff
Address: ______________________
______________________
______________________
<PAGE> 187
[Foley & Lardner] Exhibit L
_____________, 1997
OSB Financial Corp.
420 South Koeller Street
Oshkosh, Wisconsin 54902
Re: Agreement and Plan of Merger, dated as of November
__, 1996, Between FCB Financial Corp. and OSB
Financial Corp.
Gentlemen:
We have served as special counsel to FCB Financial
Corp., a Wisconsin corporation ("FCB"), in connection with the
preparation, execution and delivery of the Agreement and Plan of
Merger, dated November __, 1996 (the "Agreement"), and the Plan
of Merger, dated ________, 1997 (the "Plan of Merger"), by and
between FCB and OSB Financial Corp., a Wisconsin corporation
("OSB"), providing for the merger of OSB with and into FCB (the
"Merger"). This opinion is being delivered to you pursuant to
Section 7.2(d) of the Agreement. Capitalized terms used herein
and not otherwise defined shall have the meaning given them in
the Agreement.
As counsel for FCB, we have reviewed the Agreement, the
Plan of Merger and the Registration Statement on Form S-4 [, as
amended] of FCB (Registration No. 333-________) (the
"Registration Statement") filed with the Securities and Exchange
Commission (the "Commission"), and also have examined and relied
upon such other documents and instruments, and certificates of
public officials, and have made such other investigations and
inquiries as we have deemed necessary or appropriate for purposes
of this opinion. For purposes of this opinion, we have assumed,
without investigation: (a) the legal capacity of each natural
person; (b) the full power and authority of each person, other
than FCB and its officers, to execute, deliver and perform each
document heretofore executed and delivered or hereafter to be
executed and delivered, and to do each other act heretofore done
or hereafter to be done by such person; (c) the due
authorization, execution and delivery by each person, other than
FCB and its officers, of each document heretofore executed and
delivered or hereafter to be executed and delivered by such
person; (d) the legality, validity, binding effect and
enforceability as to each person, other than FCB and its
officers, of each document heretofore executed and delivered or
hereafter to be executed and delivered, and of each other act
heretofore done or hereafter to be done by such person; (e) the
genuineness of each signature (other than signatures of FCB
officers) on and the completeness of each document submitted to
us as an original; (f) the conformity to, and the authenticity
<PAGE> 188
of, the original of each document submitted to us as a copy; (g)
no modification of any provision of any document, nor waiver of
any right or remedy; and (h) no exercise of any right or remedy
other than in a commercially reasonable and conscionable manner
and in good faith.
As to questions of fact material to our opinion which
have not been independently established (which includes the
factual basis for those parts of our opinion which are stated to
be qualified with the statement "to our knowledge" or words of
similar import), we have relied upon, without independent
verification, the accuracy of the relevant facts stated in the
certificates or comparable documents of officers of FCB and the
FCB Subsidiaries and upon the accuracy of the representations and
warranties contained in the Agreement. Although we have made no
independent investigation or verification of each matter set
forth therein, nothing has come to our attention indicating that
such reliance by us or by you is not justified. In addition, and
particularly with respect to numbered paragraph 10 below, we wish
to advise you that we have made no special investigation as to
the factual basis for our opinion, such as a search of the
dockets or records of any court or governmental office, agency or
authority to determine if any such proceedings are pending or
orders have been entered involving FCB or the FCB Subsidiaries.
The opinions hereafter expressed are qualified to the
extent that the rights, interests and remedies under the
Agreement, the Plan of Merger, or any other documents, exhibits
or schedules delivered in connection with the transactions
contemplated thereby may be subject to or affected by: (a) any
bankruptcy, insolvency, bank conservatorship or receivership or
similar laws affecting creditors' rights and remedies generally,
and the enforcement thereof; (b) the unavailability of, or any
limitation on the availability of, any particular right or remedy
(whether in a proceeding in equity or at law) because of general
principles of equity; and (c) any limitation insofar as
indemnification and contribution provisions thereof may be
limited by applicable law. In addition, we express no opinion as
to the enforceability of Sections 1.10 and 8.3 of the Agreement.
On the basis of and subject to the foregoing and the
qualifications stated below, we are of the opinion that:
1. FCB is a corporation validly existing under the laws of
the State of Wisconsin and has the corporate power to own all of
its properties and assets and to carry on its business as it is
now being conducted as described in the Registration Statement.
FCB is a registered savings and loan holding company under the
Home Owners' Loan Act.
2. FCB Bank is validly existing as a savings association
under the laws of the United States and has the corporate power
to own all of its properties and assets and to carry on its
<PAGE> 189
business as it is now being conducted as described in the
Registration Statement.
3. Each of the FCB Subsidiaries (other than FCB Bank) is a
corporation validly existing under the laws of its respective
jurisdiction of incorporation and each has the corporate power to
own all of its properties and assets and to carry on its business
as it is now being conducted as described in Registration
Statement.
4. The authorized capitalization of FCB consists of (i)
15,000,000 shares of common stock, $.01 par value per share, of
which ____________ shares are issued and outstanding and ________
shares are held in the treasury; and (ii) 5,000,000 shares of
preferred stock, $.01 par value per share, of which no shares are
issued and outstanding. All of the issued shares of common
stock, $.01 par value, of FCB have been duly authorized and
validly issued and are fully paid and nonassessable (except with
respect to assessability as provided in Section 180.0622(2)(b) of
the Wisconsin Business Corporation Law (the "WBCL")). To our
knowledge, except for the rights of OSB under the Agreement, the
Plan of Merger, and the OSB Stock Option Agreement and except for
options granted and outstanding under FCB's 1993 Stock Option and
Incentive Plan, there are no options, agreements, contracts or
other rights in existence to purchase or acquire from FCB any
shares of capital stock of FCB.
5. FCB has full corporate power and authority to execute
and deliver the Agreement and the Plan of Merger and to
consummate the transactions contemplated thereby. The execution
and delivery and performance of the Agreement and the Plan of
Merger and the consummation of the transactions contemplated
thereby have been duly and validly approved by the Board of
Directors of FCB and, to our knowledge, in the case of the
Agreement and the Plan of Merger, by the shareholders of FCB,
these being the only corporate authorizations required under the
Articles of Incorporation and Bylaws of FCB and the WBCL. The
Agreement and the Plan of Merger have been duly and validly
executed and delivered by FCB and constitute valid and binding
obligations of FCB, enforceable against FCB in accordance with
their respective terms.
6. The execution, delivery and performance by FCB of the
Agreement and the Plan of Merger will not violate the Articles of
Incorporation or Bylaws of FCB.
7. Upon issuance in the manner and upon the terms
contemplated in the Agreement and the Plan of Merger, the shares
of common stock, $.01 par value, of FCB to be issued in the
Merger will be duly authorized, validly issued, fully paid, and
nonassessable (except with respect to assessability as provided
in Section 180.0622(2)(b) of the WBCL).
<PAGE> 190
8. At the time that the Registration Statement was
declared effective by the Commission, the Registration Statement
(other than the financial statements and supporting schedules and
the financial and statistical information or data included
therein, as to which we express no opinion) complied as to form
in all material respects with the requirements of the Securities
Act of 1933, as amended, and the rules and regulations of the
Commission thereunder.
9. No consents or approvals of, or filings or
registrations with any Governmental Entity are necessary in
connection with the execution and delivery by FCB of the
Agreement and the Plan of Merger and the consummation by FCB of
the Merger and the other transactions contemplated thereby that
have not been received or obtained as of the date hereof, except
where the failure to obtain such consent or approval or to make
such filing or registration will not have or be reasonably likely
to have a Material Adverse Effect on FCB.
10. To our knowledge, there are no actions, suits or
proceedings, pending or threatened against or affecting FCB or
the FCB Subsidiaries, at law or in equity or before or by any
governmental department, commission, board, bureau, agency or
instrumentality, or before any arbitrator of any kind which, in
our opinion, based upon such knowledge, if the relief sought in
the pleadings in such actions, suits and proceedings were granted
or if the threatened claims were accrued in full, are likely to
have a Material Adverse Effect on FCB.
We are qualified to practice law in the State of
Wisconsin and we do not purport to be experts on the law other
than that of the State of Wisconsin and the Federal laws of the
United States of America. We express no opinion and make no
representations with respect to the law of any other
jurisdiction.
This opinion is being furnished to you solely for your
benefit in connection with the Agreement. It may not be relied
upon by, nor a copy of it delivered to any other party, without
our prior written consent. This opinion is based upon our
knowledge of the law and facts as of the date hereof, and we
assume no duty to communicate with you with respect to any matter
that comes to our attention hereafter.
Very truly yours,
FOLEY & LARDNER
<PAGE> 191
Exhibit M
Christopher J. Zinski
Direct Dial: (312) 258-5548
[Schiff Hardin & Waite]
_____________, 1997
FCB Financial Corp.
108 East Wisconsin Avenue
Neenah, Wisconsin 54957
Re: Agreement and Plan of Merger, dated as of November
__, 1996, Between FCB Financial Corp. and OSB
Financial Corp.
Gentlemen:
We have served as special counsel to OSB Financial
Corp., a Wisconsin corporation ("OSB"), in connection with the
preparation, execution and delivery of the Agreement and Plan of
Merger, dated November __, 1996 (the "Agreement"), and the Plan
of Merger, dated ________, 1997 (the "Plan of Merger"), by and
between OSB and FCB Financial Corp., a Wisconsin corporation
("FCB"), providing for the merger of OSB with and into FCB (the
"Merger"). This opinion is being delivered to you pursuant to
Section 7.3(d) of the Agreement. Capitalized terms used herein
and not otherwise defined shall have the meaning given them in
the Agreement.
As counsel for OSB, we have reviewed the Agreement, the
Plan of Merger and the Registration Statement on Form S-4 [, as
amended] of FCB (Registration No. 333-________) (the
"Registration Statement") filed with the Securities and Exchange
Commission (the "Commission"), and also have examined and relied
upon such other documents and instruments, and certificates of
public officials, and have made such other investigations and
inquiries as we have deemed necessary or appropriate for purposes
of this opinion. For purposes of this opinion, we have assumed,
without investigation: (a) the legal capacity of each natural
person; (b) the full power and authority of each person, other
than OSB and its officers, to execute, deliver and perform each
document heretofore executed and delivered or hereafter to be
executed and delivered, and to do each other act heretofore done
or hereafter to be done by such person; (c) the due
authorization, execution and delivery by each person, other than
OSB and its officers, of each document heretofore executed and
delivered or hereafter to be executed and delivered by such
person; (d) the legality, validity, binding effect and
enforceability as to each person, other than OSB and its
officers, of each document heretofore executed and delivered or
hereafter to be executed and delivered, and of each other act
<PAGE> 192
heretofore done or hereafter to be done by such person; (e) the
genuineness of each signature (other than signatures of OSB
officers) on and the completeness of each document submitted to
us as an original; (f) the conformity to, and the authenticity
of, the original of each document submitted to us as a copy; (g)
no modification of any provision of any document, nor waiver of
any right or remedy; and (h) no exercise of any right or remedy
other than in a commercially reasonable and conscionable manner
and in good faith.
As to questions of fact material to our opinion which
have not been independently established (which includes the
factual basis for those parts of our opinion which are stated to
be qualified with the statement "to our knowledge" or words of
similar import), we have relied upon, without independent
verification, the accuracy of the relevant facts stated in the
certificates or comparable documents of officers of OSB and the
OSB Subsidiaries and upon the accuracy of the representations and
warranties contained in the Agreement. Although we have made no
independent investigation or verification of each matter set
forth therein, nothing has come to our attention indicating that
such reliance by us or by you is not justified. In addition, and
particularly with respect to numbered paragraph 8 below, we wish
to advise you that we have made no special investigation as to
the factual basis for our opinion, such as a search of the
dockets or records of any court or governmental office, agency or
authority to determine if any such proceedings are pending or
orders have been entered involving OSB or the OSB Subsidiaries.
The opinions hereafter expressed are qualified to the
extent that the rights, interests and remedies under the
Agreement, the Plan of Merger, or any other documents, exhibits
or schedules delivered in connection with the transactions
contemplated thereby may be subject to or affected by: (a) any
bankruptcy, insolvency, bank conservatorship or receivership or
similar laws affecting creditors' rights and remedies generally,
and the enforcement thereof; (b) the unavailability of, or any
limitation on the availability of, any particular right or remedy
(whether in a proceeding in equity or at law) because of general
principles of equity; and (c) any limitation insofar as
indemnification and contribution provisions thereof may be
limited by applicable law. In addition, (i) with respect to
numbered paragraph 5 below, we express no opinion as to the
adequacy of the Registration Statement or Joint Proxy Statement
and (ii) we express no opinion as to the enforceability of
Sections 1.10 and 8.3 of the Agreement.
On the basis of and subject to the foregoing and the
qualifications stated below, we are of the opinion that:
1. OSB is a corporation validly existing under the laws of
the State of Wisconsin and has the corporate power to own all of
its properties and assets and to carry on its business as it is
<PAGE> 193
now being conducted as described in the Registration Statement.
OSB is a registered savings and loan holding company under the
Home Owners' Loan Act.
2. OSB Bank is validly existing as a savings association
under the laws of the United States and has the corporate power
to own all of its properties and assets and to carry on its
business as it is now being conducted as described in the
Registration Statement.
3. Each of the OSB Subsidiaries (other than OSB Bank) is a
corporation validly existing under the laws of its respective
jurisdiction of incorporation and each has the corporate power to
own all of its properties and assets and to carry on its business
as it is now being conducted as described in the Registration
Statement, except that if RWFV, Inc. has been dissolved it has
paid all outstanding franchise and other taxes due and owing by
it.
4. The authorized capitalization of OSB consists of (i)
7,000,000 shares of common stock, $0.01 par value per share, of
which ____________ shares are issued and outstanding and ________
shares are held in the treasury; and (ii) 1,000,000 shares of
preferred stock, $0.01 par value per share, of which no shares
are issued and outstanding. All such issued shares of common
stock have been duly authorized and validly issued and are fully
paid and nonassessable (except with respect to assessability as
provided in Section 180.0622(2)(b) of the Wisconsin Business
Corporation Law (the "WBCL")). To our knowledge, except for the
rights of FCB under the Agreement, the Plan of Merger, FCB Stock
Option Agreement and except for options granted and outstanding
under OSB's 1992 Stock Option and Incentive Plan, there are no
options, agreements, contracts or other rights in existence to
purchase or acquire from OSB any shares of capital stock of OSB.
5. OSB has full corporate power and authority to execute
and deliver the Agreement and the Plan of Merger and to
consummate the transactions contemplated thereby. The execution
and delivery and performance of the Agreement and the Plan of
Merger and the consummation of the transactions contemplated
thereby have been duly and validly approved by the Board of
Directors of OSB and, to the best of our knowledge, in the case
of the Agreement and Plan of Merger, by the shareholders of OSB,
these being the only corporate authorizations required under the
Articles of Incorporation and Bylaws of OSB and the WBCL. The
Agreement and the Plan of Merger have been duly and validly
executed and delivered by OSB and constitute valid and binding
obligations of OSB, enforceable against OSB in accordance with
their respective terms.
6. The execution, delivery and performance by OSB of the
Agreement and the Plan of Merger will not violate the Articles of
Incorporation or Bylaws of OSB.
<PAGE> 194
7. No consents or approvals of, or filings or
registrations with, any Governmental Entity are necessary in
connection with the execution and delivery by OSB of the
Agreement and the Plan of Merger and the consummation by OSB of
the Merger and the other transactions contemplated thereby that
have not been received or obtained as of the date hereof, except
where the failure to obtain such consent or approval or to make
such filing or registration will not have or be reasonably likely
to have a Material Adverse Effect on OSB.
8. To our knowledge, there are no actions, suits or
proceedings, pending or threatened against or affecting OSB or
the OSB Subsidiaries, at law or in equity or before or by any
governmental department, commission, board, bureau, agency or
instrumentality, or before any arbitrator of any kind which, in
our opinion, based upon such knowledge, if the relief sought in
the pleadings in such actions, suits and proceedings were granted
or if the threatened claims were accrued in full, are likely to
have a Material Adverse Effect on OSB.
This opinion is being furnished to you solely for your
benefit in connection with the Agreement. It may not be relied
upon by, nor a copy of it delivered to any other party, without
our prior written consent. This opinion is based upon our
knowledge of the law and facts as of the date hereof, and we
assume no duty to communicate with you with respect to any matter
that comes to our attention hereafter.
Very truly yours,
SCHIFF HARDIN & WAITE
By:__________________________
Christopher J. Zinski
EXHIBIT 2.2
STOCK OPTION AND TRIGGER PAYMENT AGREEMENT (the
"Agreement"), dated November 13, 1996, between FCB Financial
Corp., a Wisconsin corporation ("Issuer"), and OSB Financial
Corp., a Wisconsin corporation ("Grantee").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, Grantee and Issuer have entered into an
Agreement and Plan of Merger of even date herewith (the "Merger
Agreement"), which agreement has been executed by the parties
hereto immediately prior to this Stock Option and Trigger
Agreement; and
WHEREAS, as a condition to Grantee's entering into the
Merger Agreement and in consideration therefor, Issuer has agreed
to grant Grantee the Option (as hereinafter defined).
NOW, THEREFORE, in consideration of the foregoing and
the mutual covenants and agreements set forth herein and in the
Merger Agreement, the parties hereto agree as follows:
1. (a) Issuer hereby grants to Grantee an unconditional,
irrevocable option (the "Option") to purchase, subject to the
terms hereof, up to 489,463 fully paid and nonassessable (except
as otherwise provided by Section 180.0622(2)(b) of the Wisconsin
Business Corporation Law) shares (the "Option Shares") of
Issuer's Common Stock, par value $0.01 per share ("Issuer Common
Stock"), at a price of $18.875 per share (the "Option Price");
PROVIDED, HOWEVER, that in no event shall the number of shares of
Issuer Common Stock for which this Option is exercisable exceed
19.9% of the issued and outstanding shares of Issuer Common Stock
without giving effect to any shares subject to or issued pursuant
to the Option. The number of shares of Issuer Common Stock that
may be received upon the exercise of the Option and the Option
Price are subject to adjustment as herein set forth.
(b) In the event that any additional shares of Issuer
Common Stock are either (i) issued or otherwise become
outstanding after the date of this Agreement (other than pursuant
to this Agreement) or (ii) redeemed, repurchased, retired or
otherwise cease to be outstanding after the date of this
Agreement (such event a "Change in Shares Outstanding Event"),
the number of shares of Issuer Common Stock subject to the Option
shall be increased or decreased, as appropriate, so that, after
such Change in Shares Outstanding Event, such number equals 19.9%
of the number of shares of Issuer Common Stock then issued and
outstanding without giving effect to any shares subject or issued
pursuant to the Option. Nothing contained in this Section 1(b)
or elsewhere in this Agreement shall be deemed to authorize
Issuer to issue or redeem, repurchase, or retire shares of Issuer
<PAGE> 196
Common Stock or to authorize either the Issuer or the Grantee
otherwise to breach any provision of the Merger Agreement.
(c) The Option Price shall be payable, at the option
of the Grantee, as follows:
(i) in cash, or
(ii) subject to the receipt of all approvals of
any Governmental Entity required for the Issuer to acquire, and
Grantee to issue, the Grantee Shares (as defined below) from
Grantee, in shares of common stock, $0.01 par value, of Grantee
("Grantee Shares"),
in either case in accordance with Section 4 hereof.
(d) As used in this Agreement, the "Fair Market Value"
of any share shall be the average of the last sales price for
such share on The Nasdaq Stock Market during the ten trading days
prior to the fifth trading day preceding the date such Fair
Market Value is to be determined.
2. (a) The Option may be exercised by Grantee, in whole
or in part, at any time or from time to time after the Merger
Agreement becomes terminable by Grantee under circumstances which
could entitle Grantee to a termination fee (as opposed to the
reimbursement of expenses only) under Section 8.3(a) of the
Merger Agreement or Section 8.3(b) of the Merger Agreement
(regardless of whether the Merger Agreement is actually
terminated), any such event by which the Merger Agreement becomes
so terminable by Grantee being referred to herein as a " Trigger
Event."
(b) (i) Issuer shall notify Grantee promptly in
writing of the occurrence of any Trigger Event, it being
understood that the giving of such notice by Issuer shall not be
a condition to the right of Grantee to exercise the Option.
(ii) In the event Grantee wishes to exercise the
Option, Grantee shall deliver to Issuer written notice (an
"Exercise Notice") specifying the total number of Option Shares
it wishes to purchase.
(iii) Upon the giving by Grantee of Issuer of
the Exercise Notice and the tender of the applicable aggregate
Option Price, Grantee, to the extent permitted by law and
Issuer's organizational documents, and provided that the
conditions to Issuer's obligation to issue Option Shares to
Grantee hereunder set forth in Section 3 have been satisfied or
waived, shall be deemed to be the holder of record of the Option
Shares issuable upon such exercise, notwithstanding that the
stock transfer books of Issuer shall then be closed or that
<PAGE> 197
certificates representing such Option Shares shall not then be
actually delivered to Grantee.
(iv) Each closing of a purchase of Option Shares
(a "Closing") shall occur at a place, on a date, and at a time
designated by Grantee in an Exercise Notice delivered at least
two business days prior to the date of the Closing.
(c) The Option shall terminate upon the earliest to
occur of:
(i) the Effective Time of the Merger;
(ii) the termination of the Merger Agreement
pursuant to Section 8.1 thereof, other than under circumstances
which also constitute a Trigger Event under this Agreement;
(iii) 180 days following any termination of
the Merger Agreement upon or during the continuance of a Trigger
Event (or if, at the expiration of such 180-day period, the
Option cannot be exercised by reason of any applicable judgment,
decree, order, law or regulation, ten business days after such
impediment to exercise shall have been removed or shall have
become final and not subject to appeal, but in no event under
this clause (iii) later than September 30, 1997); and
(iv) payment by Issuer of the Trigger Payment set
forth in Section 5 of this Agreement to Grantee.
(d) Notwithstanding the foregoing, the Option may not
be exercised if (i) Grantee is in material breach of any of its
representations or warranties, or in material breach of any of
its covenants or agreements, contained in this Agreement or in
the Merger Agreement, or (ii) a Trigger Payment has been paid
pursuant to Section 5 of this Agreement or demand therefor has
been made and not withdrawn.
3. The obligation of Issuer to issue Option Shares to
Grantee hereunder is subject to the conditions that
(a) the Option Shares, and any Grantee Shares which
are issued in payment of the Option Price, shall have been
approved for listing on The Nasdaq Stock Market;
(b) all consents, approvals, orders or authorizations
of, or registrations, declarations or filings with, any federal,
state or local administrative agency or commission or other
federal, state or local Governmental Entity, if any, required in
connection with the issuance by Issuer and the acquisition by
Grantee of the Option Shares hereunder shall have been obtained
or made; and
<PAGE> 198
(c) no preliminary or permanent injunction or other
order by any court of competent jurisdiction prohibiting or
otherwise restraining such issuance shall be in effect.
The condition set forth in paragraph (a) above may be waived by
Issuer, in the case of Grantee Shares, and by Grantee, in the
case of Option Shares, in the sole discretion of the waiving
party.
4. At any Closing,
(a) Issuer shall deliver to Grantee or its designee a
single certificate in definitive form representing the number of
Option Shares designated by Grantee in its Exercise Notice, such
certificate to be registered in the name of Grantee and to bear
the legend set forth in Section 13; and
(b) Grantee shall deliver to issuer the aggregate
price for the Option Shares so designated and being purchased by
(i) wire transfer of immediately available funds
or certified check or bank check, or
(ii) subject to the condition in Section 1(c)(ii),
delivery of a certificate or certificates representing the number
of Grantee Shares being issued by Grantee in consideration
thereof, determined in accordance with Section 4(c).
(c) In the event that Grantee issues Grantee Shares to
Issuer in consideration of Option Shares pursuant to Section
4(b)(ii), the number of Grantee Shares to be so issued shall be
equal to the quotient obtained by dividing:
(i) the product of (x) the number of Option
Shares with respect to which the Option is being exercised and
(y) the Option Price, by
(ii) the Fair Market Value of the Grantee Shares
as of the date immediately preceding the date the Exercise Notice
is delivered to Issuer.
(d) Issuer shall pay all expenses, and any and all
federal, state and local taxes and other charges that may be
payable in connection with the preparation, issue and delivery of
stock certificates under this Section 4.
5. (a) Subject to the provisions of Section 8.3(d) of the
Merger Agreement, if a Trigger Event shall have occurred and any
regulatory approval or order required for the issuance by Issuer,
or the acquisition by Grantee, of the Option or the Option Shares
upon exercise of the Option shall not have been obtained, Grantee
shall have the right to receive, and Issuer shall pay to Grantee,
an amount (the "Trigger Payment") equal to the product of
<PAGE> 199
(i) the maximum number of Option Shares that
would have been subject to purchases by Grantee upon exercise of
the Option pursuant to Sections 1 and 2 hereof if all such
regulatory approvals or orders had been obtained, and
(ii) the difference between (A) the Market/Offer
Price (as defined herein), determined as of the date on which
notice of demand for the Trigger Payment is given by Grantee, and
(B) the Option Price (but only if such Market/Offer Price is
higher than such Option Price).
Demand for the Trigger Payment shall be given by notice in
accordance with the provisions of Section 17 hereof. The Trigger
Payment shall be paid to Grantee by Issuer on the Payment Date
(as defined herein), by wire transfer or immediately available
funds to an account to be designated in writing by Grantee not
less than two business days before the Payment Date.
(b) For purposes of this Section 5, "Payment Date"
means the date on which termination fees are required to be paid
by Issuer to Grantee under Sections 8.3(a) or 8.3(b), as the case
may be, of the Merger Agreement as a result of the occurrence of
the Trigger Event referred to in subsection (a) of this Section 5
or such later date as Grantee shall specify with two business
days prior written notice to Issuer.
(c) Issuer shall have no obligation to pay the Trigger
Payment if Grantee is in material breach of any of its
representations or warranties, or in material breach of any of
its covenants or agreements, contained in this Agreement or in
the Merger Agreement.
6. Issuer represents and warrants to Grantee that
(a) Issuer has the corporate power and authority to
enter into this Agreement and to carry out its obligations
hereunder, subject in the case of the repurchase of the Option
Shares pursuant to Section 8(a) to applicable law;
(b) this Agreement has been duly and validly executed
and delivered by Issuer, and, assuming the due authorization,
execution and delivery hereof by Grantee and the receipt of all
required regulatory approvals, constitutes a valid and binding
obligation of Issuer, enforceable against Issuer in accordance
with its terms;
(c) Issuer has taken all necessary corporate action to
authorize and reserve for issuance and to permit it to issue,
upon exercise of the Option, and at all times from the date
hereof through the expiration of the Option will have reserved,
the number of authorized and unissued Option Shares, such amount
being subject to adjustment as provided in Sections 1 and 12, all
of which, upon their issuance and delivery in accordance with the
<PAGE> 200
terms of this Agreement, will be duly authorized, validly issued,
fully paid and nonassessable (except as otherwise provided by
Section 180.0622(2)(b) of the Wisconsin Business Corporation
Law);
(d) upon delivery of the Option Shares to Grantee upon
the exercise of the Option, Grantee will acquire the Option
Shares free and clear of all claims, liens, charges, encumbrances
and security interests of any nature whatsoever;
(e) except as described in Section 4.4 of the Merger
Agreement, the execution and delivery of this Agreement by Issuer
does not, and, subject to compliance with applicable law with
respect to the repurchase of the Option Shares pursuant to
Section 8(a), the consummation by Issuer of the transactions
contemplated hereby will not, violate, conflict with, or result
in a breach of any provision of, or constitute a default (with or
without notice or a lapse of time, or both) under, or result in
the termination of, or accelerate the performance required by, or
result in a right of termination, cancellation, or acceleration
of any obligation or the loss of a material benefit under, or the
creation of a lien, pledge, security interest or other
encumbrance on assets (any such conflict, violation, default,
right of termination, cancellation, acceleration, loss or
creation, hereinafter a "Violation") of Issuer or any of its
Subsidiaries, pursuant to
(i) any provision of the Articles of
Incorporation or the Bylaws of Issuer,
(ii) any provisions of any material loan or credit
agreement, note, mortgage, indenture, lease, benefit plan or
other agreement, obligation, instrument, permit, concession,
franchise or license (any of the foregoing in effect on the date
hereof being referred to as a "Material Contract") of Issuer or
its Subsidiaries or to which any of them is a party, or
(iii) any judgment, order, decree, statute,
law, ordinance, rule or regulation applicable to Issuer or its
properties or assets,
which Violation, in the case of each clauses (ii) and (iii),
could reasonably be expected to have a Material Adverse Effect on
Issuer (except that no representation or warranty is given
concerning any Violation of a Material Contract with respect to
the repurchase of Option Shares pursuant to Section 8(a));
(f) except as described in Section 4.4 of the Merger
Agreement, the execution and delivery of this Agreement by Issuer
does not, and the performance of this Agreement by Issuer will
not, require any consent, approval, authorization or permit of,
filing with or notification to, any Governmental Entity;
<PAGE> 201
(g) none of Issuer, any of its affiliates or anyone
acting on its or their behalf, has issued, sold or offered any
security of Issuer to any person under circumstances that would
cause the issuance and sale of the Option Shares, as contemplated
by this Agreement, to be subject to the registration requirements
of the Securities Act of 1933, as amended (the "Securities Act"),
as in effect on the date hereof, and, assuming the
representations and warranties of Grantee contained in Section
7(g) are true and correct, the issuance, sale and delivery of the
Option Shares hereunder would be exempt from the registration and
prospectus delivery requirements of the Securities Act, as in
effect on the date hereof (and Issuer shall not take any action
which would cause the issuance, sale, and delivery of the Option
Shares hereunder not to be exempt from such requirements); and
(h) any Grantee Shares acquired pursuant to this
Agreement will be acquired for Issuer's own account, for
investment purposes only, and will not be acquired by Issuer with
a view to the public distribution thereof in violation of any
applicable provision of the Securities Act.
7. Grantee represents and warrants to Issuer that
(a) Grantee has the corporate power and authority to
enter into this Agreement and to carry out its obligations
hereunder;
(b) this Agreement has been duly and validly executed
and delivered by Grantee and, assuming the due authorization,
execution and delivery hereof by Issuer and the receipt of all
required regulatory approvals, constitutes a valid and binding
obligation of Grantee, enforceable against Grantee in accordance
with its respective terms;
(c) prior to any delivery of Grantee Shares in
consideration of the purchase of Option Shares pursuant hereto,
Grantee will have taken all necessary corporate action to
authorize for issuance and to permit it to issue such Grantee
Shares, all of which, upon their issuance and delivery in
accordance with the terms of this Agreement, will be duly
authorized, validly issued, fully paid and nonassessable (except
as otherwise provided in Section 180.0622(2)(b) of the Wisconsin
Business Corporation Law);
(d) upon any delivery of such Grantee Shares to Issuer
in consideration of the purchase of the Option Shares pursuant
hereto, Issuer will acquire the Grantee Shares free and clear of
all claims, liens, charges, encumbrances and security interests
of any nature whatsoever;
(e) except as described in Section 3.4 of the Merger
Agreement, the execution and delivery of this Agreement by
Grantee does not, and the consummation by Grantee of the
<PAGE> 202
transactions contemplated hereby will not, violate, conflict
with, or result in the breach of any provision of, or constitute
a default (with or without notice or a lapse of time, or both)
under, or result in any Violation by Grantee or any of its
Subsidiaries, pursuant to
(i) any provision of the Articles of
Incorporation or Bylaws of Grantee,
(ii) any Material Contract of Grantee or any of
its Subsidiaries or to which any of them is a party, or
(iii) any judgment, order, decree, statute,
law, ordinance, rule or regulation applicable to Grantee or its
properties or assets,
which Violation, in the case of each of clauses (ii) or (iii),
would have a Material Adverse Effect on Grantee;
(f) except as described in Section 3.4 of the Merger
Agreement, the execution and delivery of this Agreement by
Grantee does not, and the consummation by Grantee of the
transactions contemplated hereby will not, require any consent,
approval, authorization or permit of, filing with or notification
to, any Governmental Entity; and
(g) any Option Shares acquired upon exercise of the
Option will be acquired for Grantee's own account, for investment
purposes only and will not be, and the Option is not being,
acquired by Grantee with a view to the public distribution
thereof, in violation of any applicable provision of the
Securities Act.
8. (a) At the request of Grantee by written notice (x) at
any time during which the Option is exercisable pursuant to
Section 2 (the "Repurchase Period"), Issuer (or any successor
entity thereof) shall, if permitted by applicable law, the
Articles of Incorporation and Bylaws of the Issuer and Issuer's
Material Contracts, repurchase from Grantee all or any portion of
the Option, at the price set forth in subparagraph (i) below, or,
(y) at any time prior to September 30, 1997, Issuer (or any
successor entity thereof) shall, if permitted by applicable law,
the Articles of Incorporation and Bylaws of Issuer and Issuer's
Material Contracts, repurchase from Grantee all or any portion of
the Option Shares purchased by Grantee pursuant to the Option, at
the price set forth in subparagraph (ii) below:
(i) (A) The difference between the "Market/Offer
Price" (as defined below) for shares of Issuer Common Stock as of
the date Grantee gives notice of its intent to exercise its
rights under this Section 8 and the Option Price, multiplied by
the number of Option Shares purchasable pursuant to the Option
(or portion thereof with respect to which Grantee is exercising
<PAGE> 203
its rights under this Section 8), but only if the Market/Offer
Price is greater than the Option Price.
(B) For purposes of this Agreement,
"Market/Offer Price" shall mean, as of any date, the higher of
(I) the price per share offered as of such date pursuant to any
tender or exchange offer or other offer with respect to a
Business Combination involving Issuer as the Target Party which
was made prior to such date and not terminated or withdrawn as of
such date and (II) the Fair Market Value per share of Issuer
Common Stock as of such date.
(ii) (A) The product of (I) the sum of (a) the
Option Price paid by Grantee per Option Share acquired pursuant
to the Option, and (b) the difference between the "Offer Price"
(as defined below) and the Option Price, but only if the Offer
Price is greater than the Option Price, and (II) the number of
Option Shares so to be repurchased pursuant to this Section 8.
(B) For purposes of this clause (ii), the
"Offer Price" shall be the highest price per share offered
pursuant to a tender or exchange offer or other Business
Combination offer involving Issuer as the Target Party during the
Repurchase Period prior to the delivery by Grantee of a notice of
repurchase.
(b) If Grantee shall have previously elected to
purchase Option Shares pursuant to the exercise of the Option by
the issuance and delivery of Grantee Shares, then Issuer shall,
if so requested by Grantee, in fulfillment of its obligation
pursuant to Section 8(a)(y) (that is, with respect to the Option
Price only and without limitation to its obligation to pay
additional consideration under clause (b) of Section
8(a)(ii)(A)(I)), redeliver the certificates for such Grantee
Shares to Grantee, free and clear of all liens, claims, charges
and encumbrances of any kind or nature whatsoever; PROVIDED,
HOWEVER, that if at any time less than all of the Option Shares
so purchased by Grantee pursuant to the Option are to be
repurchased by Issuer pursuant to Section 8(a)(y), then (i)
Issuer shall be obligated to redeliver to Grantee the same
proportion of such Grantee Shares as the number of Option Shares
that Issuer is then obligated to repurchase bears to the number
of Option Shares acquired by Grantee upon exercise of the Option
and (ii) Grantee shall issue to Issuer new certificates
representing those Grantee Shares which are not due to be
redelivered to Grantee pursuant to this Section 8(b) to the
extent that excess Grantee Shares are included in the
certificates redelivered to Grantee by Issuer.
(c) In the event Grantee exercises its rights under
this Section 8, Issuer shall, within ten business days
thereafter, pay the required amount to Grantee in immediately
available funds and Grantee shall surrender to Issuer the Option
<PAGE> 204
or the certificate or certificates evidencing the Option Shares
purchased by Grantee pursuant hereto, and Grantee shall warrant
that it owns the Option or such shares and that the Option or
such shares are then free and clear of all liens, claims,
damages, charges and encumbrances of any kind or nature
whatsoever.
(d) If Grantee has elected to purchase Option shares
pursuant to the exercise of the Option by the issuance and
delivery of Grantee Shares, notwithstanding that Grantee may no
longer hold any such Option Shares or that Grantee elects not to
exercise its other rights under this Section 8, Grantee may
require, at any time or from time to time prior to September 30,
1997, Issuer to sell to Grantee any such Grantee Shares at the
price attributed to such Grantee Shares pursuant to Section 4
plus interest at the publicly announced prime rate as published
in the Wall Street Journal (Midwest Edition) on such amount from
the Closing Date relating to the exchange of such Grantee shares
pursuant to Section 4 to the Closing Date under this Section 8(d)
less any dividends on such Grantee Shares paid during such period
or declared and payable to shareholders of record on a date
during such period.
(e) In the event the repurchase price specified in
Section 8(a) would subject the purchase of the Option or the
Option Shares purchased by Grantee pursuant to the Option to a
vote of the shareholders of Issuer pursuant to applicable law or
the Articles of Incorporation of Issuer, then Grantee may, at its
election, reduce the repurchase price to an amount which would
permit such repurchase without the necessity for such a
shareholder vote.
9. Following the date hereof and prior to the fifth
anniversary of the date hereof (the "Expiration Date"), each
party shall vote any shares of capital stock of the other party
acquired by such party pursuant to this Agreement ("Restricted
Shares"), including any Grantee Shares issued pursuant to Section
1(c), or otherwise beneficially owned (within the meaning of Rule
13d-3 promulgated under the Securities Exchange Act of 1934, as
amended (the "Exchange Act")), by such party on each matter
submitted to a vote of shareholders of such other party for and
against such matter in the same proportion as the vote of all
other shareholders of such other party are voted (whether by
proxy or otherwise) for and against such matter.
10. (a) Prior to the Expiration Date, neither party shall,
directly or indirectly, sell, assign, pledge, or otherwise
dispose of or transfer any Restricted Shares beneficially owned
by such party, other than (i) pursuant to Section 8, or (ii) in
accordance with Section 10(b) or Section 11.
(b) Following the termination of the Merger Agreement,
a party shall be permitted to sell any Restricted Shares
<PAGE> 205
beneficially owned by it if such sale is made pursuant to a
tender or exchange offer that has been approved or recommended,
or otherwise determined to be fair to and in the best interests
of the shareholders of the other party, by a majority of the
members of the Board of Directors of such other party, which
majority shall include a majority of directors who were directors
prior to the announcement of such tender or exchange offer.
11. (a) Following the termination of the Merger Agreement,
either party hereto that owns Restricted Shares (a "Designated
Holder") may by written notice (the "Registration Notice") to the
other party (the "Registrant") request the Registrant to register
under the Securities Act all or any part of the Restricted Shares
beneficially owned by such Designated Holder (the "Registrable
Securities") pursuant to a bona fide firm commitment underwritten
public offering, in which the Designated Holder and the
underwriters shall effect as wide a distribution of such
Registrable Securities as is reasonably practicable and shall use
their best efforts to prevent any person (including any Group (as
used in Rule 13d-5 under the Exchange Act)) and its affiliates
from purchasing through such offering Restricted Shares
representing more than 1% of the outstanding shares of common
stock of the Registrant on a fully diluted basis (a "Permitted
Offering").
(b) The Registration Notice shall include a
certificate executed by the Designated Holder and its proposed
managing underwriter, which underwriter shall be an investment
banking firm of recognized standing on a national or regional
basis (the "Manager"), stating that
(i) they have a good faith intention to commence
promptly a Permitted Offering, and
(ii) Manager in good faith believes that, based on
the then-prevailing market conditions, it will be able to sell
the Registrable Securities at a per share price equal to at least
80% of the then Fair Market Value of such shares.
(c) The Registrant (and/or any person designed by the
Registrant) shall thereupon have the option exercisable by
written notice delivered to the Designated Holder within ten
business days after the receipt of the Registration Notice,
irrevocably to agree to purchase all or any part of the
Registrable Securities proposed to be so sold for cash at a price
equal to the product of (i) the number of Registrable Securities
to be so purchased by the Registrant and (ii) the then Fair
Market Value of such shares.
(d) Any purchase of Registrable Securities by the
Registrant (or its designee) under Section 11(c) shall take place
at a closing to be held at the principal executive offices of the
Registrant or at the offices of its counsel at any reasonable
<PAGE> 206
date and time designated by the Registrant and/or such designee
in such notice within twenty business days after delivery of such
notice, and any payment for the shares to be so purchased shall
be made by delivery at the time of such closing in immediately
available funds.
(e) If the Registrant does not elect to exercise its
option pursuant to this Section 11 with respect to all
Registrable Securities, it shall use its best efforts to effect,
as promptly as practicable, the registration under the Securities
Act of the unpurchased Registrable Securities proposed to be so
sold; PROVIDED, HOWEVER, that
(i) neither party shall be entitled to demand
more than an aggregate of two effective registration statements
hereunder, and
(ii) the Registrant will not be required to file
any such registration statement during any period of time (not to
exceed 40 days after such request in the case of clause (A) below
or 90 days in the case of clauses (B) and (C) below) when
(A) the Registrant is in possession of
material non-public information which it reasonably believes
would be detrimental to be disclosed at such time and, in the
opinion of counsel to the Registrant, such information would be
required to be disclosed if a registration statement were filed
at that time;
(B) the Registrant is required under the
Securities Act to include audited financial statements for any
period in such registration statement and such financial
statements are not yet available for inclusion in such
registration statement; or
(C) the Registrant determines, in its
reasonable judgment, that such registration would interfere with
any financing, acquisition or other material transaction
involving the Registrant or any of its affiliates.
(f) The Registrant shall use its reasonable best
efforts to cause any Registrable Securities registered pursuant
to this Section 11 to be qualified for sale under the securities
or Blue Sky laws of such jurisdictions as the Designated Holder
may reasonably request and shall continue such registration or
qualification in effect in such jurisdiction; PROVIDED, HOWEVER,
that the Registrant shall not be required to qualify to do
business in, or consent to general service of process in, any
jurisdiction by reason of this provision.
(g) The registration rights set forth in this Section
11 are subject to the condition that the Designated Holder shall
provide the Registrant with such information with respect to such
<PAGE> 207
holder's Registrable Securities, the plans for the distribution
thereof, and such other information with respect to such holder
as, in the reasonable judgment of counsel for the Registrant, is
necessary to enable the Registrant to include in such
registration statement all material facts required to be
disclosed with respect to a registration thereunder.
(h) A registration effected under this Section 11
shall be effected at the Registrant's expense, except for
underwriting discounts and commissions and the fees and the
expenses of counsel to the Designated Holder, and the Registrant
shall provide to the underwriters such documentation (including
certificates, opinions of counsel and "comfort" letters from
auditors) as is customary in connection with underwritten public
offerings as such underwriters may reasonably require.
(i) In connection with any registration effected under
this Section 11, the parties agree
(i) to indemnify each other and the underwriters
in the customary manner,
(ii) to enter into an underwriting agreement in
form and substance customary for transactions of such type with
the Manager and the other underwriters participating in such
offering, and
(iii) to take all further actions which shall
be reasonably necessary to effect such registration and sale
(including if the Manager deems it necessary, participating in
road show presentations).
(j) The Registrant shall be entitled to include (at
its expense) additional shares of its common stock in a
registration effected pursuant to this Section 11 only if and to
the extent the Manager determines that such inclusion will not
adversely affect the prospects for success of such offering.
12. Without limitation to any restriction on Issuer
contained in this Agreement or in the Merger Agreement, in the
event of any change in Issuer Common Stock by reason of stock
dividends, splitups, mergers (other than the Merger),
recapitalizations, combinations, exchange of shares or the like,
the type and number of shares or securities subject to the
Option, and the Option Price provided in Section 1, shall be
adjusted appropriately to restore to Grantee its rights
hereunder, including the right to purchase from Issuer (or its
successors) shares of Issuer Common Stock (or such other shares
or securities into which Issuer Common Stock has been so changed)
for the aggregate Option Price as provided in Section 1.
13. Each certificate representing Option Shares issued to
Grantee hereunder, and Grantee Shares, if any, delivered to
<PAGE> 208
Issuer at a Closing, shall include a legend in substantially the
following form:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR ANY STATE SECURITIES OR BLUE SKY LAWS, AND
MAY BE REOFFERED OR SOLD ONLY IF SO REGISTERED OR IF AN
EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE. SUCH
SECURITIES ARE ALSO SUBJECT TO ADDITIONAL RESTRICTIONS
ON TRANSFER AS SET FORTH IN A STOCK OPTION AND TRIGGER
PAYMENT AGREEMENT, DATED AS OF NOVEMBER 13, 1996, A
COPY OF WHICH MAY BE OBTAINED FROM THE ISSUER UPON
REQUEST.
It is understood and agreed that:
(i) the reference to the resale restrictions of
the Securities Act and state securities or Blue Sky laws in the
above legend shall be removed by delivery of substitute
certificate(s) without such reference if Grantee or Issuer, as
the case may be, shall have delivered to the other party a copy
of a letter from the staff of the Securities and Exchange
Commission, or an opinion of counsel, in form and substance
reasonably satisfactory to the other party, to the effect that
such legend is not required for purposes of the Securities Act or
such laws;
(ii) the reference to the provisions to this
Agreement in the above legend shall be removed by delivery of
substitute certificate(s) without such reference if the shares
have been sold or transferred in compliance with the provisions
of this Agreement and under circumstances that do not require the
retention of such reference; and
(iii) the legend shall be removed in its
entirety if the conditions in the preceding clauses (i) and (ii)
are both satisfied.
In addition, such certificates shall bear any other legend as may
be required by law. Certificates representing shares sold in a
registered public offering pursuant to Section 11 shall not be
required to bear the legend set forth in this Section 13.
14. (a) This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors
and permitted assigns.
(b) Except as expressly provided for in this
Agreement, neither this Agreement nor the rights or obligations
of either party hereto are assignable, except by operation of
law, or with the written consent of the other party.
<PAGE> 209
(c) Nothing contained in this Agreement, express or
implied, is intended to confer upon any person other than the
parties hereto and their respective successors and permitted
assigns any rights or remedies of any nature whatsoever by reason
of this Agreement.
(d) Any Restricted Shares sold by a party in
compliance with the provisions of Section 11 shall, upon
consummation of such sale, be free of the restrictions imposed
with respect to such shares by this Agreement, unless and until
such party shall repurchase or otherwise become the beneficial
owner of such shares, and any transferee of such shares shall not
be entitled to the registration rights of such party.
15. The parties hereto acknowledge that damages would
be an inadequate remedy for a breach of this Agreement by either
party hereto and that the obligations of the parties hereto shall
be enforceable by either party hereto through injunctive or other
equitable relief.
16. If any term, provision, covenant or restriction
contained in this Agreement is held by a court or a federal or
state regulatory agency of competent jurisdiction to be invalid,
void or unenforceable, the remainder of the terms, provisions and
covenants and restrictions contained in this Agreement shall
remain in full force and effect, and shall in no way be affected,
impaired or invalidated. Subject to Section 5, if for any reason
any such court or regulatory agency determines that Grantee is
not permitted to acquire, or Issuer is not permitted to
repurchase pursuant to Section 8, the full number of Option
Shares provided in Section 1 hereof (as the same may be
adjusted), it is the express intention of Issuer to allow Grantee
to acquire or to require Issuer to repurchase such lesser number
of shares as may be permissible without any amendment or
modification hereof.
17. All notices and other communications hereunder
shall be in writing and shall be deemed given if delivered
personally, telecopied (with confirmation), mailed by registered
or certified mail (return receipt requested) or delivered by an
express courier (with confirmation) at the respective addresses
of the parties set forth in the Merger Agreement (or at such
other address for a party as shall be specified by like notice).
18. This Agreement shall be governed by and construed
in accordance with the laws of the State of Wisconsin, regardless
of the laws that might otherwise govern under applicable
principles of conflicts of laws thereof.
19. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original,
but all of which shall constitute one and the same agreement.
<PAGE> 210
20. Except as otherwise expressly provided herein,
each of the parties hereto shall bear and pay all costs and
expenses incurred by it or on its behalf in connection with the
transactions contemplated hereunder, including fees and expenses
of its own financial consultants, investment bankers, accountants
and counsel.
21. Except as otherwise expressly provided herein or
in the Merger Agreement, this Agreement contains the entire
agreement between the parties with respect to the transactions
contemplated hereunder and supersedes all prior arrangements or
understandings with respect thereof, written or oral.
22. This Agreement may be amended by the parties
hereto and the terms and conditions hereof may be waived only by
an instrument in writing signed on behalf of each of the parties
hereto, or, in the case of a waiver, by an instrument signed on
behalf of the party waiving compliance.
23. The time periods for exercises of certain rights
under Sections 2, 5 and 8 shall be extended (but in no event by
more than six months):
(a) to the extent necessary to obtain all regulatory
approvals for the exercise of such rights; and
(b) to the extent necessary to avoid any liability
under Section 16(b) of the Exchange Act by reason of such
exercise.
24. Capitalized terms used in this Agreement and not
defined herein shall have the meanings assigned thereto in the
Merger Agreement.
IN WITNESS WHEREOF, each of the parties has caused this
Agreement to be executed on its behalf by its officers thereunto
duly authorized, all as of the date first above written.
FCB FINANCIAL CORP.
By: /s/ Donald D. Parker
------------------------------
Donald D. Parker
President and Chief Executive Officer
OSB FINANCIAL CORP.
By:/s/ James J. Rothenbach
------------------------------
James J. Rothenbach
President and Chief Executive Officer
EXHIBIT 2.3
STOCK OPTION AND TRIGGER PAYMENT AGREEMENT (the
"Agreement"), dated November 13, 1996, between OSB Financial
Corp., a Wisconsin corporation ("Issuer"), and FCB Financial
Corp., a Wisconsin corporation ("Grantee").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, Grantee and Issuer have entered into an
Agreement and Plan of Merger of even date herewith (the "Merger
Agreement"), which agreement has been executed by the parties
hereto immediately prior to this Stock Option and Trigger
Agreement; and
WHEREAS, as a condition to Grantee's entering into the
Merger Agreement and in consideration therefor, Issuer has agreed
to grant Grantee the Option (as hereinafter defined).
NOW, THEREFORE, in consideration of the foregoing and
the mutual covenants and agreements set forth herein and in the
Merger Agreement, the parties hereto agree as follows:
1. (a) Issuer hereby grants to Grantee an unconditional,
irrevocable option (the "Option") to purchase, subject to the
terms hereof, up to 230,866 fully paid and nonassessable (except
as otherwise provided by Section 180.0622(2)(b) of the Wisconsin
Business Corporation Law) shares (the "Option Shares") of
Issuer's Common Stock, par value $0.01 per share ("Issuer Common
Stock"), at a price of $24.375 per share (the "Option Price");
PROVIDED, HOWEVER, that in no event shall the number of shares of
Issuer Common Stock for which this Option is exercisable exceed
19.9% of the issued and outstanding shares of Issuer Common Stock
without giving effect to any shares subject to or issued pursuant
to the Option. The number of shares of Issuer Common Stock that
may be received upon the exercise of the Option and the Option
Price are subject to adjustment as herein set forth.
(b) In the event that any additional shares of Issuer
Common Stock are either (i) issued or otherwise become
outstanding after the date of this Agreement (other than pursuant
to this Agreement) or (ii) redeemed, repurchased, retired or
otherwise cease to be outstanding after the date of this
Agreement (such event a "Change in Shares Outstanding Event"),
the number of shares of Issuer Common Stock subject to the Option
shall be increased or decreased, as appropriate, so that, after
such Change in Shares Outstanding Event, such number equals 19.9%
of the number of shares of Issuer Common Stock then issued and
outstanding without giving effect to any shares subject or issued
pursuant to the Option. Nothing contained in this Section 1(b)
or elsewhere in this Agreement shall be deemed to authorize
Issuer to issue or redeem, repurchase, or retire shares of Issuer
<PAGE> 212
Common Stock or to authorize either the Issuer or the Grantee
otherwise to breach any provision of the Merger Agreement.
(c) The Option Price shall be payable, at the option
of the Grantee, as follows:
(i) in cash, or
(ii) subject to the receipt of all approvals of
any Governmental Entity required for the Issuer to acquire, and
Grantee to issue, the Grantee Shares (as defined below) from
Grantee, in shares of common stock, $0.01 par value, of Grantee
("Grantee Shares"),
in either case in accordance with Section 4 hereof.
(d) As used in this Agreement, the "Fair Market Value"
of any share shall be the average of the last sales price for
such share on The Nasdaq Stock Market during the ten trading days
prior to the fifth trading day preceding the date such Fair
Market Value is to be determined.
2. (a) The Option may be exercised by Grantee, in whole
or in part, at any time or from time to time after the Merger
Agreement becomes terminable by Grantee under circumstances which
could entitle Grantee to a termination fee (as opposed to the
reimbursement of expenses only) under Section 8.3(a) of the
Merger Agreement or Section 8.3(b) of the Merger Agreement
(regardless of whether the Merger Agreement is actually
terminated), any such event by which the Merger Agreement becomes
so terminable by Grantee being referred to herein as a " Trigger
Event."
(b) (i) Issuer shall notify Grantee promptly in
writing of the occurrence of any Trigger Event, it being
understood that the giving of such notice by Issuer shall not be
a condition to the right of Grantee to exercise the Option.
(ii) In the event Grantee wishes to exercise the
Option, Grantee shall deliver to Issuer written notice (an
"Exercise Notice") specifying the total number of Option Shares
it wishes to purchase.
(iii) Upon the giving by Grantee of Issuer of
the Exercise Notice and the tender of the applicable aggregate
Option Price, Grantee, to the extent permitted by law and
Issuer's organizational documents, and provided that the
conditions to Issuer's obligation to issue Option Shares to
Grantee hereunder set forth in Section 3 have been satisfied or
waived, shall be deemed to be the holder of record of the Option
Shares issuable upon such exercise, notwithstanding that the
stock transfer books of Issuer shall then be closed or that
<PAGE> 213
certificates representing such Option Shares shall not then be
actually delivered to Grantee.
(iv) Each closing of a purchase of Option Shares
(a "Closing") shall occur at a place, on a date, and at a time
designated by Grantee in an Exercise Notice delivered at least
two business days prior to the date of the Closing.
(c) The Option shall terminate upon the earliest to
occur of:
(i) the Effective Time of the Merger;
(ii) the termination of the Merger Agreement
pursuant to Section 8.1 thereof, other than under circumstances
which also constitute a Trigger Event under this Agreement;
(iii) 180 days following any termination of
the Merger Agreement upon or during the continuance of a Trigger
Event (or if, at the expiration of such 180-day period, the
Option cannot be exercised by reason of any applicable judgment,
decree, order, law or regulation, ten business days after such
impediment to exercise shall have been removed or shall have
become final and not subject to appeal, but in no event under
this clause (iii) later than September 30, 1997); and
(iv) payment by Issuer of the Trigger Payment set
forth in Section 5 of this Agreement to Grantee.
(d) Notwithstanding the foregoing, the Option may not
be exercised if (i) Grantee is in material breach of any of its
representations or warranties, or in material breach of any of
its covenants or agreements, contained in this Agreement or in
the Merger Agreement, or (ii) a Trigger Payment has been paid
pursuant to Section 5 of this Agreement or demand therefor has
been made and not withdrawn.
3. The obligation of Issuer to issue Option Shares to
Grantee hereunder is subject to the conditions that
(a) the Option Shares, and any Grantee Shares which
are issued in payment of the Option Price, shall have been
approved for listing on The Nasdaq Stock Market;
(b) all consents, approvals, orders or authorizations
of, or registrations, declarations or filings with, any federal,
state or local administrative agency or commission or other
federal, state or local Governmental Entity, if any, required in
connection with the issuance by Issuer and the acquisition by
Grantee of the Option Shares hereunder shall have been obtained
or made; and
<PAGE> 214
(c) no preliminary or permanent injunction or other
order by any court of competent jurisdiction prohibiting or
otherwise restraining such issuance shall be in effect.
The condition set forth in paragraph (a) above may be waived by
Issuer, in the case of Grantee Shares, and by Grantee, in the
case of Option Shares, in the sole discretion of the waiving
party.
4. At any Closing,
(a) Issuer shall deliver to Grantee or its designee a
single certificate in definitive form representing the number of
Option Shares designated by Grantee in its Exercise Notice, such
certificate to be registered in the name of Grantee and to bear
the legend set forth in Section 13; and
(b) Grantee shall deliver to issuer the aggregate
price for the Option Shares so designated and being purchased by
(i) wire transfer of immediately available funds
or certified check or bank check, or
(ii) subject to the condition in Section 1(c)(ii),
delivery of a certificate or certificates representing the number
of Grantee Shares being issued by Grantee in consideration
thereof, determined in accordance with Section 4(c).
(c) In the event that Grantee issues Grantee Shares to
Issuer in consideration of Option Shares pursuant to Section
4(b)(ii), the number of Grantee Shares to be so issued shall be
equal to the quotient obtained by dividing:
(i) the product of (x) the number of Option
Shares with respect to which the Option is being exercised and
(y) the Option Price, by
(ii) the Fair Market Value of the Grantee Shares
as of the date immediately preceding the date the Exercise Notice
is delivered to Issuer.
(d) Issuer shall pay all expenses, and any and all
federal, state and local taxes and other charges that may be
payable in connection with the preparation, issue and delivery of
stock certificates under this Section 4.
5. (a) Subject to the provisions of Section 8.3(d) of the
Merger Agreement, if a Trigger Event shall have occurred and any
regulatory approval or order required for the issuance by Issuer,
or the acquisition by Grantee, of the Option or the Option Shares
upon exercise of the Option shall not have been obtained, Grantee
shall have the right to receive, and Issuer shall pay to Grantee,
an amount (the "Trigger Payment") equal to the product of
<PAGE> 215
(i) the maximum number of Option Shares that
would have been subject to purchases by Grantee upon exercise of
the Option pursuant to Sections 1 and 2 hereof if all such
regulatory approvals or orders had been obtained, and
(ii) the difference between (A) the Market/Offer
Price (as defined herein), determined as of the date on which
notice of demand for the Trigger Payment is given by Grantee, and
(B) the Option Price (but only if such Market/Offer Price is
higher than such Option Price).
Demand for the Trigger Payment shall be given by notice in
accordance with the provisions of Section 17 hereof. The Trigger
Payment shall be paid to Grantee by Issuer on the Payment Date
(as defined herein), by wire transfer or immediately available
funds to an account to be designated in writing by Grantee not
less than two business days before the Payment Date.
(b) For purposes of this Section 5, "Payment Date"
means the date on which termination fees are required to be paid
by Issuer to Grantee under Sections 8.3(a) or 8.3(b), as the case
may be, of the Merger Agreement as a result of the occurrence of
the Trigger Event referred to in subsection (a) of this Section 5
or such later date as Grantee shall specify with two business
days prior written notice to Issuer.
(c) Issuer shall have no obligation to pay the Trigger
Payment if Grantee is in material breach of any of its
representations or warranties, or in material breach of any of
its covenants or agreements, contained in this Agreement or in
the Merger Agreement.
6. Issuer represents and warrants to Grantee that
(a) Issuer has the corporate power and authority to
enter into this Agreement and to carry out its obligations
hereunder, subject in the case of the repurchase of the Option
Shares pursuant to Section 8(a) to applicable law;
(b) this Agreement has been duly and validly executed
and delivered by Issuer, and, assuming the due authorization,
execution and delivery hereof by Grantee and the receipt of all
required regulatory approvals, constitutes a valid and binding
obligation of Issuer, enforceable against Issuer in accordance
with its terms;
(c) Issuer has taken all necessary corporate action to
authorize and reserve for issuance and to permit it to issue,
upon exercise of the Option, and at all times from the date
hereof through the expiration of the Option will have reserved,
the number of authorized and unissued Option Shares, such amount
being subject to adjustment as provided in Sections 1 and 12, all
of which, upon their issuance and delivery in accordance with the
<PAGE> 216
terms of this Agreement, will be duly authorized, validly issued,
fully paid and nonassessable (except as otherwise provided by
Section 180.0622(2)(b) of the Wisconsin Business Corporation
Law);
(d) upon delivery of the Option Shares to Grantee upon
the exercise of the Option, Grantee will acquire the Option
Shares free and clear of all claims, liens, charges, encumbrances
and security interests of any nature whatsoever;
(e) except as described in Section 3.4 of the Merger
Agreement, the execution and delivery of this Agreement by Issuer
does not, and, subject to compliance with applicable law with
respect to the repurchase of the Option Shares pursuant to
Section 8(a), the consummation by Issuer of the transactions
contemplated hereby will not, violate, conflict with, or result
in a breach of any provision of, or constitute a default (with or
without notice or a lapse of time, or both) under, or result in
the termination of, or accelerate the performance required by, or
result in a right of termination, cancellation, or acceleration
of any obligation or the loss of a material benefit under, or the
creation of a lien, pledge, security interest or other
encumbrance on assets (any such conflict, violation, default,
right of termination, cancellation, acceleration, loss or
creation, hereinafter a "Violation") of Issuer or any of its
Subsidiaries, pursuant to
(i) any provision of the Articles of
Incorporation or the Bylaws of Issuer,
(ii) any provisions of any material loan or credit
agreement, note, mortgage, indenture, lease, benefit plan or
other agreement, obligation, instrument, permit, concession,
franchise or license (any of the foregoing in effect on the date
hereof being referred to as a "Material Contract") of Issuer or
its Subsidiaries or to which any of them is a party, or
(iii) any judgment, order, decree, statute,
law, ordinance, rule or regulation applicable to Issuer or its
properties or assets,
which Violation, in the case of each clauses (ii) and (iii),
could reasonably be expected to have a Material Adverse Effect on
Issuer (except that no representation or warranty is given
concerning any Violation of a Material Contract with respect to
the repurchase of Option Shares pursuant to Section 8(a));
(f) except as described in Section 3.4 of the Merger
Agreement, the execution and delivery of this Agreement by Issuer
does not, and the performance of this Agreement by Issuer will
not, require any consent, approval, authorization or permit of,
filing with or notification to, any Governmental Entity;
<PAGE> 217
(g) none of Issuer, any of its affiliates or anyone
acting on its or their behalf, has issued, sold or offered any
security of Issuer to any person under circumstances that would
cause the issuance and sale of the Option Shares, as contemplated
by this Agreement, to be subject to the registration requirements
of the Securities Act of 1933, as amended (the "Securities Act"),
as in effect on the date hereof, and, assuming the
representations and warranties of Grantee contained in Section
7(g) are true and correct, the issuance, sale and delivery of the
Option Shares hereunder would be exempt from the registration and
prospectus delivery requirements of the Securities Act, as in
effect on the date hereof (and Issuer shall not take any action
which would cause the issuance, sale, and delivery of the Option
Shares hereunder not to be exempt from such requirements); and
(h) any Grantee Shares acquired pursuant to this
Agreement will be acquired for Issuer's own account, for
investment purposes only, and will not be acquired by Issuer with
a view to the public distribution thereof in violation of any
applicable provision of the Securities Act.
7. Grantee represents and warrants to Issuer that
(a) Grantee has the corporate power and authority to
enter into this Agreement and to carry out its obligations
hereunder;
(b) this Agreement has been duly and validly executed
and delivered by Grantee and, assuming the due authorization,
execution and delivery hereof by Issuer and the receipt of all
required regulatory approvals, constitutes a valid and binding
obligation of Grantee, enforceable against Grantee in accordance
with its respective terms;
(c) prior to any delivery of Grantee Shares in
consideration of the purchase of Option Shares pursuant hereto,
Grantee will have taken all necessary corporate action to
authorize for issuance and to permit it to issue such Grantee
Shares, all of which, upon their issuance and delivery in
accordance with the terms of this Agreement, will be duly
authorized, validly issued, fully paid and nonassessable (except
as otherwise provided in Section 180.0622(2)(b) of the Wisconsin
Business Corporation Law);
(d) upon any delivery of such Grantee Shares to Issuer
in consideration of the purchase of the Option Shares pursuant
hereto, Issuer will acquire the Grantee Shares free and clear of
all claims, liens, charges, encumbrances and security interests
of any nature whatsoever;
(e) except as described in Section 3.4 of the Merger
Agreement, the execution and delivery of this Agreement by
Grantee does not, and the consummation by Grantee of the
<PAGE> 218
transactions contemplated hereby will not, violate, conflict
with, or result in the breach of any provision of, or constitute
a default (with or without notice or a lapse of time, or both)
under, or result in any Violation by Grantee or any of its
Subsidiaries, pursuant to
(i) any provision of the Articles of
Incorporation or Bylaws of Grantee,
(ii) any Material Contract of Grantee or any of
its Subsidiaries or to which any of them is a party, or
(iii) any judgment, order, decree, statute,
law, ordinance, rule or regulation applicable to Grantee or its
properties or assets,
which Violation, in the case of each of clauses (ii) or (iii),
would have a Material Adverse Effect on Grantee;
(f) except as described in Section 3.4 of the Merger
Agreement, the execution and delivery of this Agreement by
Grantee does not, and the consummation by Grantee of the
transactions contemplated hereby will not, require any consent,
approval, authorization or permit of, filing with or notification
to, any Governmental Entity; and
(g) any Option Shares acquired upon exercise of the
Option will be acquired for Grantee's own account, for investment
purposes only and will not be, and the Option is not being,
acquired by Grantee with a view to the public distribution
thereof, in violation of any applicable provision of the
Securities Act.
8. (a) At the request of Grantee by written notice (x) at
any time during which the Option is exercisable pursuant to
Section 2 (the "Repurchase Period"), Issuer (or any successor
entity thereof) shall, if permitted by applicable law, the
Articles of Incorporation and Bylaws of the Issuer and Issuer's
Material Contracts, repurchase from Grantee all or any portion of
the Option, at the price set forth in subparagraph (i) below, or,
(y) at any time prior to September 30, 1997, Issuer (or any
successor entity thereof) shall, if permitted by applicable law,
the Articles of Incorporation and Bylaws of Issuer and Issuer's
Material Contracts, repurchase from Grantee all or any portion of
the Option Shares purchased by Grantee pursuant to the Option, at
the price set forth in subparagraph (ii) below:
(i) (A) The difference between the "Market/Offer
Price" (as defined below) for shares of Issuer Common Stock as of
the date Grantee gives notice of its intent to exercise its
rights under this Section 8 and the Option Price, multiplied by
the number of Option Shares purchasable pursuant to the Option
(or portion thereof with respect to which Grantee is exercising
<PAGE> 219
its rights under this Section 8), but only if the Market/Offer
Price is greater than the Option Price.
(B) For purposes of this Agreement,
"Market/Offer Price" shall mean, as of any date, the higher of
(I) the price per share offered as of such date pursuant to any
tender or exchange offer or other offer with respect to a
Business Combination involving Issuer as the Target Party which
was made prior to such date and not terminated or withdrawn as of
such date and (II) the Fair Market Value per share of Issuer
Common Stock as of such date.
(ii) (A) The product of (I) the sum of (a) the
Option Price paid by Grantee per Option Share acquired pursuant
to the Option, and (b) the difference between the "Offer Price"
(as defined below) and the Option Price, but only if the Offer
Price is greater than the Option Price, and (II) the number of
Option Shares so to be repurchased pursuant to this Section 8.
(B) For purposes of this clause (ii), the
"Offer Price" shall be the highest price per share offered
pursuant to a tender or exchange offer or other Business
Combination offer involving Issuer as the Target Party during the
Repurchase Period prior to the delivery by Grantee of a notice of
repurchase.
(b) If Grantee shall have previously elected to
purchase Option Shares pursuant to the exercise of the Option by
the issuance and delivery of Grantee Shares, then Issuer shall,
if so requested by Grantee, in fulfillment of its obligation
pursuant to Section 8(a)(y) (that is, with respect to the Option
Price only and without limitation to its obligation to pay
additional consideration under clause (b) of Section
8(a)(ii)(A)(I)), redeliver the certificates for such Grantee
Shares to Grantee, free and clear of all liens, claims, charges
and encumbrances of any kind or nature whatsoever; PROVIDED,
HOWEVER, that if at any time less than all of the Option Shares
so purchased by Grantee pursuant to the Option are to be
repurchased by Issuer pursuant to Section 8(a)(y), then (i)
Issuer shall be obligated to redeliver to Grantee the same
proportion of such Grantee Shares as the number of Option Shares
that Issuer is then obligated to repurchase bears to the number
of Option Shares acquired by Grantee upon exercise of the Option
and (ii) Grantee shall issue to Issuer new certificates
representing those Grantee Shares which are not due to be
redelivered to Grantee pursuant to this Section 8(b) to the
extent that excess Grantee Shares are included in the
certificates redelivered to Grantee by Issuer.
(c) In the event Grantee exercises its rights under
this Section 8, Issuer shall, within ten business days
thereafter, pay the required amount to Grantee in immediately
available funds and Grantee shall surrender to Issuer the Option
<PAGE> 220
or the certificate or certificates evidencing the Option Shares
purchased by Grantee pursuant hereto, and Grantee shall warrant
that it owns the Option or such shares and that the Option or
such shares are then free and clear of all liens, claims,
damages, charges and encumbrances of any kind or nature
whatsoever.
(d) If Grantee has elected to purchase Option shares
pursuant to the exercise of the Option by the issuance and
delivery of Grantee Shares, notwithstanding that Grantee may no
longer hold any such Option Shares or that Grantee elects not to
exercise its other rights under this Section 8, Grantee may
require, at any time or from time to time prior to September 30,
1997, Issuer to sell to Grantee any such Grantee Shares at the
price attributed to such Grantee Shares pursuant to Section 4
plus interest at the publicly announced prime rate as published
in the Wall Street Journal (Midwest Edition) on such amount from
the Closing Date relating to the exchange of such Grantee shares
pursuant to Section 4 to the Closing Date under this Section 8(d)
less any dividends on such Grantee Shares paid during such period
or declared and payable to shareholders of record on a date
during such period.
(e) In the event the repurchase price specified in
Section 8(a) would subject the purchase of the Option or the
Option Shares purchased by Grantee pursuant to the Option to a
vote of the shareholders of Issuer pursuant to applicable law or
the Articles of Incorporation of Issuer, then Grantee may, at its
election, reduce the repurchase price to an amount which would
permit such repurchase without the necessity for such a
shareholder vote.
9. Following the date hereof and prior to the fifth
anniversary of the date hereof (the "Expiration Date"), each
party shall vote any shares of capital stock of the other party
acquired by such party pursuant to this Agreement ("Restricted
Shares"), including any Grantee Shares issued pursuant to Section
1(c), or otherwise beneficially owned (within the meaning of Rule
13d-3 promulgated under the Securities Exchange Act of 1934, as
amended (the "Exchange Act")), by such party on each matter
submitted to a vote of shareholders of such other party for and
against such matter in the same proportion as the vote of all
other shareholders of such other party are voted (whether by
proxy or otherwise) for and against such matter.
10. (a) Prior to the Expiration Date, neither party shall,
directly or indirectly, sell, assign, pledge, or otherwise
dispose of or transfer any Restricted Shares beneficially owned
by such party, other than (i) pursuant to Section 8, or (ii) in
accordance with Section 10(b) or Section 11.
(b) Following the termination of the Merger Agreement,
a party shall be permitted to sell any Restricted Shares
<PAGE> 221
beneficially owned by it if such sale is made pursuant to a
tender or exchange offer that has been approved or recommended,
or otherwise determined to be fair to and in the best interests
of the shareholders of the other party, by a majority of the
members of the Board of Directors of such other party, which
majority shall include a majority of directors who were directors
prior to the announcement of such tender or exchange offer.
11. (a) Following the termination of the Merger Agreement,
either party hereto that owns Restricted Shares (a "Designated
Holder") may by written notice (the "Registration Notice") to the
other party (the "Registrant") request the Registrant to register
under the Securities Act all or any part of the Restricted Shares
beneficially owned by such Designated Holder (the "Registrable
Securities") pursuant to a bona fide firm commitment underwritten
public offering, in which the Designated Holder and the
underwriters shall effect as wide a distribution of such
Registrable Securities as is reasonably practicable and shall use
their best efforts to prevent any person (including any Group (as
used in Rule 13d-5 under the Exchange Act)) and its affiliates
from purchasing through such offering Restricted Shares
representing more than 1% of the outstanding shares of common
stock of the Registrant on a fully diluted basis (a "Permitted
Offering").
(b) The Registration Notice shall include a
certificate executed by the Designated Holder and its proposed
managing underwriter, which underwriter shall be an investment
banking firm of recognized standing on a national or regional
basis (the "Manager"), stating that
(i) they have a good faith intention to commence
promptly a Permitted Offering, and
(ii) Manager in good faith believes that, based on
the then-prevailing market conditions, it will be able to sell
the Registrable Securities at a per share price equal to at least
80% of the then Fair Market Value of such shares.
(c) The Registrant (and/or any person designed by the
Registrant) shall thereupon have the option exercisable by
written notice delivered to the Designated Holder within ten
business days after the receipt of the Registration Notice,
irrevocably to agree to purchase all or any part of the
Registrable Securities proposed to be so sold for cash at a price
equal to the product of (i) the number of Registrable Securities
to be so purchased by the Registrant and (ii) the then Fair
Market Value of such shares.
(d) Any purchase of Registrable Securities by the
Registrant (or its designee) under Section 11(c) shall take place
at a closing to be held at the principal executive offices of the
Registrant or at the offices of its counsel at any reasonable
<PAGE> 222
date and time designated by the Registrant and/or such designee
in such notice within twenty business days after delivery of such
notice, and any payment for the shares to be so purchased shall
be made by delivery at the time of such closing in immediately
available funds.
(e) If the Registrant does not elect to exercise its
option pursuant to this Section 11 with respect to all
Registrable Securities, it shall use its best efforts to effect,
as promptly as practicable, the registration under the Securities
Act of the unpurchased Registrable Securities proposed to be so
sold; PROVIDED, HOWEVER, that
(i) neither party shall be entitled to demand
more than an aggregate of two effective registration statements
hereunder, and
(ii) the Registrant will not be required to file
any such registration statement during any period of time (not to
exceed 40 days after such request in the case of clause (A) below
or 90 days in the case of clauses (B) and (C) below) when
(A) the Registrant is in possession of
material non-public information which it reasonably believes
would be detrimental to be disclosed at such time and, in the
opinion of counsel to the Registrant, such information would be
required to be disclosed if a registration statement were filed
at that time;
(B) the Registrant is required under the
Securities Act to include audited financial statements for any
period in such registration statement and such financial
statements are not yet available for inclusion in such
registration statement; or
(C) the Registrant determines, in its
reasonable judgment, that such registration would interfere with
any financing, acquisition or other material transaction
involving the Registrant or any of its affiliates.
(f) The Registrant shall use its reasonable best
efforts to cause any Registrable Securities registered pursuant
to this Section 11 to be qualified for sale under the securities
or Blue Sky laws of such jurisdictions as the Designated Holder
may reasonably request and shall continue such registration or
qualification in effect in such jurisdiction; PROVIDED, HOWEVER,
that the Registrant shall not be required to qualify to do
business in, or consent to general service of process in, any
jurisdiction by reason of this provision.
(g) The registration rights set forth in this Section
11 are subject to the condition that the Designated Holder shall
provide the Registrant with such information with respect to such
<PAGE> 223
holder's Registrable Securities, the plans for the distribution
thereof, and such other information with respect to such holder
as, in the reasonable judgment of counsel for the Registrant, is
necessary to enable the Registrant to include in such
registration statement all material facts required to be
disclosed with respect to a registration thereunder.
(h) A registration effected under this Section 11
shall be effected at the Registrant's expense, except for
underwriting discounts and commissions and the fees and the
expenses of counsel to the Designated Holder, and the Registrant
shall provide to the underwriters such documentation (including
certificates, opinions of counsel and "comfort" letters from
auditors) as is customary in connection with underwritten public
offerings as such underwriters may reasonably require.
(i) In connection with any registration effected under
this Section 11, the parties agree
(i) to indemnify each other and the underwriters
in the customary manner,
(ii) to enter into an underwriting agreement in
form and substance customary for transactions of such type with
the Manager and the other underwriters participating in such
offering, and
(iii) to take all further actions which shall
be reasonably necessary to effect such registration and sale
(including if the Manager deems it necessary, participating in
road show presentations).
(j) The Registrant shall be entitled to include (at
its expense) additional shares of its common stock in a
registration effected pursuant to this Section 11 only if and to
the extent the Manager determines that such inclusion will not
adversely affect the prospects for success of such offering.
12. Without limitation to any restriction on Issuer
contained in this Agreement or in the Merger Agreement, in the
event of any change in Issuer Common Stock by reason of stock
dividends, splitups, mergers (other than the Merger),
recapitalizations, combinations, exchange of shares or the like,
the type and number of shares or securities subject to the
Option, and the Option Price provided in Section 1, shall be
adjusted appropriately to restore to Grantee its rights
hereunder, including the right to purchase from Issuer (or its
successors) shares of Issuer Common Stock (or such other shares
or securities into which Issuer Common Stock has been so changed)
for the aggregate Option Price as provided in Section 1.
13. Each certificate representing Option Shares issued to
Grantee hereunder, and Grantee Shares, if any, delivered to
<PAGE> 224
Issuer at a Closing, shall include a legend in substantially the
following form:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR ANY STATE SECURITIES OR BLUE SKY LAWS, AND
MAY BE REOFFERED OR SOLD ONLY IF SO REGISTERED OR IF AN
EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE. SUCH
SECURITIES ARE ALSO SUBJECT TO ADDITIONAL RESTRICTIONS
ON TRANSFER AS SET FORTH IN A STOCK OPTION AND TRIGGER
PAYMENT AGREEMENT, DATED AS OF NOVEMBER 13, 1996, A
COPY OF WHICH MAY BE OBTAINED FROM THE ISSUER UPON
REQUEST.
It is understood and agreed that:
(i) the reference to the resale restrictions of
the Securities Act and state securities or Blue Sky laws in the
above legend shall be removed by delivery of substitute
certificate(s) without such reference if Grantee or Issuer, as
the case may be, shall have delivered to the other party a copy
of a letter from the staff of the Securities and Exchange
Commission, or an opinion of counsel, in form and substance
reasonably satisfactory to the other party, to the effect that
such legend is not required for purposes of the Securities Act or
such laws;
(ii) the reference to the provisions to this
Agreement in the above legend shall be removed by delivery of
substitute certificate(s) without such reference if the shares
have been sold or transferred in compliance with the provisions
of this Agreement and under circumstances that do not require the
retention of such reference; and
(iii) the legend shall be removed in its
entirety if the conditions in the preceding clauses (i) and (ii)
are both satisfied.
In addition, such certificates shall bear any other legend as may
be required by law. Certificates representing shares sold in a
registered public offering pursuant to Section 11 shall not be
required to bear the legend set forth in this Section 13.
14. (a) This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors
and permitted assigns.
(b) Except as expressly provided for in this
Agreement, neither this Agreement nor the rights or obligations
of either party hereto are assignable, except by operation of
law, or with the written consent of the other party.
<PAGE> 225
(c) Nothing contained in this Agreement, express or
implied, is intended to confer upon any person other than the
parties hereto and their respective successors and permitted
assigns any rights or remedies of any nature whatsoever by reason
of this Agreement.
(d) Any Restricted Shares sold by a party in
compliance with the provisions of Section 11 shall, upon
consummation of such sale, be free of the restrictions imposed
with respect to such shares by this Agreement, unless and until
such party shall repurchase or otherwise become the beneficial
owner of such shares, and any transferee of such shares shall not
be entitled to the registration rights of such party.
15. The parties hereto acknowledge that damages would
be an inadequate remedy for a breach of this Agreement by either
party hereto and that the obligations of the parties hereto shall
be enforceable by either party hereto through injunctive or other
equitable relief.
16. If any term, provision, covenant or restriction
contained in this Agreement is held by a court or a federal or
state regulatory agency of competent jurisdiction to be invalid,
void or unenforceable, the remainder of the terms, provisions and
covenants and restrictions contained in this Agreement shall
remain in full force and effect, and shall in no way be affected,
impaired or invalidated. Subject to Section 5, if for any reason
any such court or regulatory agency determines that Grantee is
not permitted to acquire, or Issuer is not permitted to
repurchase pursuant to Section 8, the full number of Option
Shares provided in Section 1 hereof (as the same may be
adjusted), it is the express intention of Issuer to allow Grantee
to acquire or to require Issuer to repurchase such lesser number
of shares as may be permissible without any amendment or
modification hereof.
17. All notices and other communications hereunder
shall be in writing and shall be deemed given if delivered
personally, telecopied (with confirmation), mailed by registered
or certified mail (return receipt requested) or delivered by an
express courier (with confirmation) at the respective addresses
of the parties set forth in the Merger Agreement (or at such
other address for a party as shall be specified by like notice).
18. This Agreement shall be governed by and construed
in accordance with the laws of the State of Wisconsin, regardless
of the laws that might otherwise govern under applicable
principles of conflicts of laws thereof.
19. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original,
but all of which shall constitute one and the same agreement.
<PAGE> 226
20. Except as otherwise expressly provided herein,
each of the parties hereto shall bear and pay all costs and
expenses incurred by it or on its behalf in connection with the
transactions contemplated hereunder, including fees and expenses
of its own financial consultants, investment bankers, accountants
and counsel.
21. Except as otherwise expressly provided herein or
in the Merger Agreement, this Agreement contains the entire
agreement between the parties with respect to the transactions
contemplated hereunder and supersedes all prior arrangements or
understandings with respect thereof, written or oral.
22. This Agreement may be amended by the parties
hereto and the terms and conditions hereof may be waived only by
an instrument in writing signed on behalf of each of the parties
hereto, or, in the case of a waiver, by an instrument signed on
behalf of the party waiving compliance.
23. The time periods for exercises of certain rights
under Sections 2, 5 and 8 shall be extended (but in no event by
more than six months):
(a) to the extent necessary to obtain all regulatory
approvals for the exercise of such rights; and
(b) to the extent necessary to avoid any liability
under Section 16(b) of the Exchange Act by reason of such
exercise.
24. Capitalized terms used in this Agreement and not
defined herein shall have the meanings assigned thereto in the
Merger Agreement.
IN WITNESS WHEREOF, each of the parties has caused this
Agreement to be executed on its behalf by its officers thereunto
duly authorized, all as of the date first above written.
FCB FINANCIAL CORP.
By: /s/ Donald D. Parker
------------------------------
Donald D. Parker
President and Chief Executive Officer
OSB FINANCIAL CORP.
By:/s/ James J. Rothenbach
------------------------------
James J. Rothenbach
President and Chief Executive Officer
EXHIBIT 99
PRESS RELEASE
FCB Financial Corp. OSB Financial Corp.
108 E. Wisconsin Ave. 420 S. Koeller St.
Neenah, Wisconsin 54957 Oshkosh, Wisconsin 54902
Contact: Phillip J. Schoofs Contact: James J. Rothenbach
or Donald D. Parker (414) 236-3680
(414) 727-3427 or (414) 727-3429
FCB FINANCIAL CORP. AND OSB FINANCIAL CORP.
ANNOUNCE MERGER OF EQUALS
-------------------------------------------
November 14, 1996. FCB Financial Corp. (Nasdaq National
Market: FCBF), Neenah, Wisconsin, parent of Fox Cities Bank,
F.S.B., and OSB Financial Corp. (Nasdaq National Market: OSBF),
Oshkosh, Wisconsin, parent of Oshkosh Savings Bank, F.S.B., today
announced the signing of a definitive agreement pursuant to which
the two companies will be merged. The resulting company will
operate under the name FCB Financial Corp. and will be
headquartered in Oshkosh, Wisconsin.
The merger, which will combine two of the oldest banking
institutions in Wisconsin's Fox River Valley, will create the
largest independent thrift institution headquartered in the area.
Based on data as of September 30, 1996, the combined institution
will have total assets in excess of $500 million, total loans of
approximately $390 million, total deposits of approximately $310
million and shareholders' equity of approximately $75 million.
The combined company also will have in excess of $220 million of
mortgage loans that it originated and services for others.
The "merger of equals" transaction will be structured as a
tax-free, stock-for-stock merger and accounted for as a purchase
transaction. In the merger, holders of OSB Financial Corp.
common stock will receive 1.46 shares of FCB common stock for
each OSB share they own. Holders of shares of FCB Financial
Corp. common stock will continue to hold the same number of FCB
shares after the merger. FCB's and OSB's total outstanding
shares at September 30, 1996 were 2.46 million and 1.11 million,
respectively. The shares of the combined company are expected to
continue to trade on The Nasdaq Stock Market. The banking
subsidiaries of the two merger partners are also expected to
merge and will thereafter operate under the name Fox Cities Bank,
F.S.B.
<PAGE> 228
At the effective time of the merger, it is expected that the
quarterly cash dividend of the combined company will remain at
the current FCB Financial Corp. level of $.18 per share. Based
on the exchange rate in the merger, this would equate to an
annual per share dividend increase for holders of OSB Financial
Corp. common stock of approximately 64%.
"This merger of equals provides an opportunity for both
revenue enhancement and cost savings which we believe will result
in an accretion in earnings per share for the combined company,"
said Donald D. Parker, Chairman of the Board, President and Chief
Executive Officer of FCB Financial Corp. and James J. Rothenbach,
President and Chief Executive Officer of OSB Financial Corp.
It is currently estimated that the combination of various
functions and other economies of scale when implemented will
result in annual pre-tax cost savings for the combined company on
a net basis of approximately $800,000. "Although there is
potential for substantial cost savings, our strategy will focus
on revenue enhancement from our strong mortgage business as well
as an expansion of various other services, including full service
business banking, commercial lending, consumer lending, indirect
lending, brokerage and investment services and trust services,"
said Rothenbach.
Both Rothenbach and Parker commented that the merger will
align two companies that are committed to community involvement
and locally delivered, high quality customer service. "This
combination provides the strength and resources to be a truly
outstanding community financial center," said Rothenbach. "This
will enable us to expand the products and services we offer both
individual consumers and businesses throughout our market areas,"
added Parker.
Upon completion of the merger, Parker will serve as Chairman
of the combined company and Rothenbach will serve as President
and Chief Executive Officer. The Board of Directors of the
combined company will initially consist of an equal number of
representatives from both merger partners.
The combined company will continue to provide full service
banking from each of the existing 13 offices located in Appleton
(3), Berlin, Darboy, Menasha, Neenah (2), Oshkosh (2), Ripon,
Wautoma and Winneconne, Wisconsin.
The merger is subject to approval of the shareholders of
both FCB Financial Corp. and OSB Financial Corp. and is also
subject to various regulatory approvals. Based on the
anticipated timetable for the receipt of such approvals, it is
currently expected that the merger will be completed during the
second quarter of 1997.
<PAGE> 229
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This press release includes forward-looking statements.
These forward-looking statements can be identified as
such because the context of the statement includes
phrases such as "it is expected" or "it is currently
estimated" or other words of similar import.
Similarly, statements that describe future plans or
strategies are also forward-looking statements. Such
statements are subject to certain risks and
uncertainties which could cause actual results to
differ materially from those currently anticipated.
Factors which could affect actual results include
interest rate trends, the general economic climate in
the FCB and OSB market areas, loan delinquency rates,
regulatory treatment and the ability of the combined
company to implement successfully plans to eliminate
redundancies. These factors should be considered in
evaluating the forward-looking statements, and undue
reliance should not be placed on such statements. The
forward-looking statements included herein are made as
of the date hereof and FCB and OSB undertake no
obligation to update publicly such statements to
reflect subsequent events or circumstances.
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