MERGER AGREEMENT
THIS IS A MERGER AGREEMENT (this "Merger Agreement") dated as of
December 18, 1996 by and among NORTH AMERICAN TRUST COMPANY, a California state
trust company ("NATCO"), with its principal place of business at 225 Broadway,
Suite 400, San Diego, California 92101, NORTH AMERICAN FIDUCIARY SERVICES, INC.,
a California corporation ("NAFS"), with its principal place of business at 650
California Street, San Francisco, California 94108, DANIELSON TRUST COMPANY, a
California state trust company ("DTC"), with its principal place of business at
525 B Street, 16th Floor, San Diego, California 92101, and DANIELSON HOLDING
CORPORATION, a Delaware corporation ("DHC"), with its principal place of
business at 767 Third Avenue, Fifth Floor, New York, New York 10017.
RECITALS
WHEREAS, NATCO and DHC are parties to that certain Stock Sale
Agreement, dated as of October 10, 1996 (the "Sale Agreement"). NATCO is a
wholly owned subsidiary of NAFS. DTC is a wholly owned subsidiary of DHC. The
Sale Agreement provides for the acquisition of DTC's stock by NATCO. For
business and regulatory reasons, that acquisition of DTC will be accomplished by
the merger of DTC into NATCO (with NATCO surviving) and the payment of the
specified consideration to DHC by NAFS. That merger will be consummated on the
terms of this Merger Agreement and in accordance with Sections 4880 through 4891
of the California Financial Code (the "Merger");
WHEREAS, NATCO has authorized capital stock of 10,000,000 shares of
common stock, $1.00 par value per share, of which at the date hereof 270,000
shares are outstanding.
WHEREAS, DTC has authorized capital stock of 10,000 shares of common
stock, $125.00 par value per share, of which at the date hereof 5,000 shares are
outstanding;
WHEREAS, the directors, or a majority of them, of each constituent
entity, respectively, deem it advisable and in the best interests of the
respective trust companies and their respective shareholders that the Merger be
so consummated; and
WHEREAS, this Merger Agreement is being executed on behalf of DHC to
facilitate the timely consummation of the transactions contemplated by the Sale
Agreement and the related Assignment and Assumption Agreement and Acknowledgment
among NATC, NAFS and DHC, and is not intended to modify those agreements in any
substantive way.
NOW, THEREFORE, NATCO, NAFS, DTC and DHC, in consideration of the
premises and of the mutual covenants and agreements contained herein and in the
Sale Agreement and of the benefits to accrue to them, hereby agree that the
constituent trust companies be merged into a single trust company which shall be
NATCO and hereby agree, prescribe and set forth (among other provisions) the
terms and conditions of the Merger, the mode of carrying the same into effect
and the manner and basis of converting the shares of each constituent trust
company on the terms and subject to the conditions set forth in this Merger
Agreement.
ARTICLE I
MERGER
1.1 DTC shall be merged into NATCO in accordance with the applicable
provisions of Sections 4880 through 4891 of the California Financial Code upon
the filing of this Merger Agreement with the California State Superintendent of
Banks (the "Superintendent"), following prior approval by the Superintendent and
certification by the California Secretary of State. The Merger shall be
effective, subject to the completion of the above filings, at 5:01 P.M.,
TUESDAY, DECEMBER 31,1996 (the "Effective Time"). At the Effective Time, the
separate existence of DTC shall cease except to the extent provided by law in
the case of a corporation after its merger into another corporation and NATCO
shall continue under the laws of California as the surviving trust company (the
"surviving trust company").
1.2 The name of the surviving trust company shall be "North American
Trust Company."
1.3 The main office of the surviving trust company shall be 225
Broadway, Suite 400, San Diego, California 92101.
ARTICLE II
ARTICLES OF INCORPORATION AND
BYLAWS OF SURVIVING TRUST COMPANY
2.1 The Articles of Incorporation of NATCO as in effect immediately
before the Effective Time shall continue in full force and effect as the
Articles of Incorporation of the surviving trust company until thereafter duly
amended.
2.2 The Bylaws of NATCO as in effect immediately before the Effective
Time shall continue in full force and effect as the Bylaws of the surviving
trust company until thereafter duly amended.
ARTICLE III
BOARD OF DIRECTORS AND
OFFICERS OF SURVIVING TRUST COMPANY
3.1 All directors of NATCO serving immediately before the Effective
Time shall continue to serve for the terms to which they were elected before the
Effective Time.
3.2 All officers of NATCO serving immediately before the Effective Time
shall continue to serve for the terms to which they were elected before the
Effective Time.
ARTICLE IV
MANNER OF CONVERTING SHARES
OF STOCK OF CONSTITUENT TRUST COMPANIES
4.1 As of the Effective Time, all outstanding shares of capital stock
of DTC that are outstanding immediately before the Effective Time shall, by
virtue of the Merger and without any action on the part of the holder hereof, be
converted into the right to receive a total of $3,000,000, representing $600.00
per share of common stock DTC.
ARTICLE V
SUBMISSION TO SHAREHOLDERS AND EFFECTIVENESS
5.1 This Merger Agreement shall be submitted for consideration and vote
by the shareholder of each constituent trust company as required by California
law. If adopted by the requisite votes of the shareholder of each constituent
trust company, this Merger Agreement shall be delivered to the Superintendent
and the California Secretary of State for filing. The officers of the
constituent trust companies shall execute all such other documents and take all
such other actions as may be necessary to effect the Merger in accordance with
this Merger Agreement.
ARTICLE VI
TRANSFER OF ASSETS AND LIABILITIES
6.1 Upon and after the Effective Time, the surviving trust company
shall possess all the rights, privileges, powers and franchises, of a public as
well as of a private nature, and be subject to all the restrictions,
disabilities and duties, of the constituent trust companies; and all the rights,
privileges, powers and franchises of the constituent trust companies, and all
property, real, personal and mixed, and all debts due to either constituent
trust company on whatever account, as well for stock subscriptions as all other
things in action or belonging to each constituent trust company shall be vested
in the surviving trust company; and all property, rights, privileges, powers and
franchises, and all and every other interest, shall be thereafter as effectively
the property of the surviving trust company as they were constituent trust
companies, and the title to any real estate vested by deed or otherwise in
either constituent trust company shall not revert or be in any way impaired by
reason of the Merger; but all rights of creditors and all liens upon any
property of either constituent trust company shall be preserved unimpaired, and
all debts, liabilities and duties of the constituent trust companies shall
thenceforth attach to the surviving trust company, and may be enforced against
it to the same extent as if said debts, liabilities and duties had been incurred
or contracted by it.
6.2 If at any time after the Effective Time the surviving trust company
shall consider or be advised that any further deeds, assignments or assurances
in law or any other things are necessary, desirable or proper to vest, perfect
or confirm, of record or otherwise, in the surviving trust company, the title to
any property or rights of the constituent trust company acquired or to be
acquired by reason of, or as a result of, the Merger, the constituent trust
companies agree that the surviving trust company and its proper officers and
directors shall execute and deliver all such property, deeds, assignments and
assurances in law and do all things necessary, desirable or proper to vest,
perfect or confirm title to such property or rights in the surviving trust
company and otherwise carry out the purposes of this Merger Agreement, and that
the proper officers and directors of the constituent trust companies and the
proper officers and directors of the surviving trust company are fully
authorized in the name of the constituent trust companies or otherwise to take
any and all such action.
ARTICLE VII
TERMINATION OF AGREEMENT AND ABANDONMENT OF MERGER
7.1 This Merger Agreement and the Merger contemplated hereby may be
terminated and abandoned, as provided in the Sale Agreement, at any time before
this Merger Agreement has been filed as provided herein, whether before or after
approval of this Merger Agreement by the shareholders of DTC and NATCO, or both
of them, and shall automatically terminate without further action by either of
the parties hereto if the Sale Agreement is terminated in accordance with its
terms.
7.2 At any time before the filing of this Merger Agreement as provided
herein, the parties hereto may, by written agreement approved by their Boards of
Directors, and with any required shareholder approval, (i) extend the time for
the performance of any of the obligations or other acts of the parties hereto,
(ii) waive compliance with any of the conditions, covenants or agreements
contained in this Merger Agreement or (iii) amend or modify any of the
provisions of this Merger Agreement.
7.3 If for any reason this Merger Agreement ceases to be binding upon
the constituent trust companies because of termination as provided herein or
otherwise, it shall thereafter be void without further action by the
shareholders of either constituent trust company.
ARTICLE VIII
MISCELLANEOUS
8.1 This Merger Agreement may be executed in several counterparts, each
of which shall be deemed an original, but all of which counterparts collectively
shall constitute one instrument representing the Merger Agreement.
8.2 Except as otherwise provided in this Merger Agreement, nothing
herein expressed or implied is intended, or shall be construed, to confer upon
or give any person, firm or bank, other than the constituent trust companies and
their respective security holders and their successors and assigns, any rights
or remedies under or by reason of this Merger Agreement.
8.3 This Merger Agreement and the legal relations between the parties
shall be governed by and construed in accordance with the internal laws of the
State of California without taking into account provisions regarding choice of
law, except to the extent certain matters may be governed as a matter of law by
the law of the jurisdiction of organization o DHC.
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IN WITNESS WHEREOF, NATCO, NAFS, Danielson and DHC have caused this
Merger Agreement to be signed as of the date first above written.
NORTH AMERICAN TRUST COMPANY DANIELSON TRUST COMPANY
By: /s/ Mark Fingerlin By: /s/ A. Vincent Siciliano
L. Mark Fingerlin A. Vincent Siciliano
President and Chief President and Chief
Executive Officer Executive Officer
By: /s/ Julie Duncan By: /s/ Carlee Harmonson
Julie Duncan Carlee Harmonson
Assistant Secretary Assistant Secretary
NORTH AMERICAN FIDUCIARY SERVICES, INC. DANIELSON HOLDING CORPORATION
By: /s/ Ian K. Whitehead By: /s/ David M. Barse
Ian K. Whitehead David M. Barse
Vice President President and Chief
Operating Officer
By: /s/ Robert A. Cornman By: /s/ Ian Kirschner
Robert A. Cornman Ian Kirschner
Assistant Secretary Secretary