EXHIBIT 2
PURCHASE
AND
ASSUMPTION AGREEMENT
ONBANK & TRUST CO.
TO
CAYUGA SAVINGS BANK
TABLE OF CONTENTS
PAGE
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I. DEFINITIONS
1.1 Certain Defined Terms 1
1.2 Accounting Terms 4
1.3 Materiality 4
II. TRANSFER OF ASSETS AND ASSUMPTION OF LIABILITIES
2.1 Transfer of Assets 4
2.2 Assumption of Liabilities 5
2.3 Transfer of Records 6
2.4 Tax Matters 6
2.5 Matters Relating to the Sale of the Real
Property 7
2.6 Proration of Certain Expenses 8
2.7 Back Office Conversion 8
2.8 Processing of Certain Items After Closing 8
2.9 Information Returns 9
III. BID AMOUNT AND PAYMENTS
3.1 Amount of Premium 9
3.2 Payment by Seller 9
3.3 Settlement 10
IV. SELLER'S REPRESENTATIONS AND WARRANTIES
4.1 Power and Authority 10
4.2 Litigation and Regulatory Proceedings 11
4.3 Consents and Approvals 11
4.4 Real Property and Fixed Assets 11
4.5 Ownership of Loans 12
4.6 Validity of and Compliance with Real Property
Leases 12
4.7 Financial Information 12
4.8 Taxes 12
4.9 Labor Relations 12
4.10 Insurance 13
4.11 Environmental Matters 13
V. BUYER'S REPRESENTATIONS AND WARRANTIES
5.1 Power and Authority 13
5.2 Litigation and Regulatory Proceedings 14
5.3 Consents and Approvals 14
5.4 Retirement Plan Accounts 14
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VI. ADDITIONAL AGREEMENTS OF SELLER
6.1 Access to Seller's Premises, Records,
and Personnel 14
6.2 Regulatory Approvals 15
6.3 Conduct of Business 15
6.4 Indemnification 15
6.5 Exclusive Arrangement 15
6.6 IRAs and Qualified Retirement Plan Accounts 16
VII. ADDITIONAL AGREEMENTS OF BUYER
7.1 Solicitation of Seller's Customers 16
7.2 Regulatory Approvals 16
7.3 Indemnification 16
7.4 Confidentiality 17
7.5 Change of Name, Etc. 17
7.6 Continued Operation of the Branches 17
VIII. EMPLOYEES OF THE BRANCHES
8.1 Retention of Employees 18
8.2 Training 18
IX. CLOSING AND CONDITIONS TO CLOSING
9.1 Time and Place of Closing 18
9.2 Exchange of Closing Documents 19
9.3 Buyer's Conditions to Closing 19
9.4 Seller's Conditions to Closing 20
9.5 Survival of Representations and Warranties 21
X. TERMINATION
10.1 Termination by Either Party 21
10.2 Termination by Seller 22
10.3 Termination by Buyer 22
XI. MISCELLANEOUS
11.1 Continuing Cooperation 22
11.2 Merger and Amendment 22
11.3 Disputes 23
11.4 Counterparts 24
11.5 Exhibits and Schedules 24
11.6 Assignment 24
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MISCELLANEOUS CONT.
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11.7 Headings 24
11.8 Notices 24
11.9 Expenses 25
11.10 Public Announcements 25
EXHIBITS
Exhibit 2.8 Clearing Procedures 26
Exhibit 3.3A Form of Preliminary Closing Statement 27
Exhibit 3.3B Form of Final Closing Statement 29
Exhibit 9.3 Form of Seller's Opinion of Counsel 31
Exhibit 9.3A Municipal Deposit Procedures 33
Exhibit 9.4 Form of Buyer's Opinion of Counsel 34
SCHEDULES
Schedule 1.1 Branches Subject to the Agreement 36
Schedule 1.1A Savings & Time Deposits 37
Schedule 1.1B Demand Deposits 38
Schedule 1.1C Small Business Loans to Be Acquired
by Buyer 39
Schedule 1.1E Mortgage Loans (Commercial) 40
Schedule 1.1F Mortgage Loans (Consumer) 41
Schedule 1.1G Other Personal Loans 42
Schedule 1.1H Safe Deposit Contracts 43
Schedule 4.4B Schedule of Fixed Assets and
Equipment Leases 44
Schedule 4.6 Real Property Leases 45
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PURCHASE AND ASSUMPTION AGREEMENT
---------------------------------
This Agreement, dated December 28, 1995, between OnBank & Trust Co., having its
principal place of business in Syracuse, New York ("Seller") and Cayuga Savings
Bank, a New York stock form savings bank, having its principal place of business
in Auburn, New York ("Buyer").
RECITALS
--------
A. Seller desires to sell or otherwise dispose of assets and liabilities
of certain of its branches as defined in this Agreement.
B. Buyer has proposed to purchase these assets and liabilities, upon the
terms and conditions provided in this Agreement.
AGREEMENT
---------
In consideration of the mutual promises set forth in this Agreement, Buyer
and Seller agree as follows:
I. DEFINITIONS
1.1 Certain Defined Terms.
---------------------
Some of the capitalized terms appearing in this Agreement are defined
below. The definition of a term expressed in the singular also applies to that
term as used in the plural in this
Agreement and vice versa.
"Amount of Premium" has the meaning set forth in Section 3.1 of this
Agreement.
"Assets" has the meaning set forth in Section 2.1 of this Agreement.
"Branches" means those banking offices of Seller listed on Schedule 1.1 to
this Agreement.
"Business Day" means any Monday, Tuesday, Wednesday, Thursday or Friday on
which both Seller and Buyer are open for business.
"Closing" means the transfer of the Assets and the assumption of the
Liabilities on the Closing Date.
"Closing Date" has the meaning set forth in Section 9.1 of this Agreement.
"Confidentiality Agreement" means the letter agreement dated October 2,
1995 between Buyer and Seller.
"Custody and Security Agreements" include those agreements relating to
securing the Municipal Deposits listed in Schedule 1.1B hereto.
"Deposit Accounts" means those existing deposit accounts at Seller, the
balances of which are included in the Deposits or would be so included if the
account had a positive balance.
"Deposits" means all deposits as defined in 12 U.S.C. Section 1813(l) which
are booked at the Branches, including accrued but unpaid interest and both
collected and uncollected funds, together with Seller's rights and
responsibilities under any customer agreement evidencing or relating thereto
(including, without limitation, any night deposit or check encashment
agreements), but excluding (i) deposits held in accounts for which Seller acts
as fiduciary (other than deposits held by Retirement Plans), (ii) deposits
subject to legal process, (iii) deposits which have been reported as abandoned
property under the abandoned property laws of any jurisdiction, (iv) deposits
held in any IRA where the depositor has notified Seller or Buyer of his or her
objection to Buyer acting as custodian or trustee of the IRA, (v) deposits held
in any Qualified Retirement Plan where the customer does not adopt Buyer's
master or prototype qualified retirement plan before the Closing, (vi) deposits
relating to loans or other extensions of credit not included in the Assets,
(vii) deposits by Seller's affiliates, and (viii) deposits constituting official
checks, travelers checks, money orders, or certified checks.
"Environmental Law" means any federal, state, or local environmental, land
use, zoning, health, chemical use, safety, or sanitation law, statute,
ordinance, or code relating to the protection of the environment and/or
governing the use, storage, treatment, generation, transportation, processing,
handling, production or disposal of any hazardous substance as defined in the
same, as well as any rule, regulation, policy, guideline, interpretation,
decision, order, or directive of any federal, state, or local governmental
agency or authority with respect to any Environmental Law.
"Equipment Leases" means those operating and financial leases and
conditional sales contracts under which Seller holds equipment included in the
Fixed Assets.
"Executive Officer" has the meaning set forth in 12 C.F.R. Section 215.2.
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"Fair Market Value of the Real Property" means the amount determined under
Section 2.5(a).
"Fixed Assets" means all fixtures (including existing signage poles but not
signage boxes), leasehold improvements, furnishings, vaults, equipment
(including, for example, all ATM machines, security equipment, computer
equipment to the extent compatible with Buyer's computer system, and related
telecommunications equipment), supplies (other than forms and other supplies
which bear Seller's logo), and other personal property ordinarily maintained at
the Branches which are owned or (to the extent of the lessee's interest) leased
by Seller. Nevertheless, Fixed Assets shall include leased equipment only to
the extent that the applicable Equipment Leases can be assigned to Buyer.
"IRAs" mean those non-discretionary individual retirement (depository)
accounts relating to the Branches.
"Leased Branches" means all premises of the Branches which Seller leases
and occupies under the Real Property Leases.
"Liabilities" has the meaning set forth in Section 2.2 of this Agreement.
"Loan Documentation" means all notes, loan or credit agreements, security
or other collateral agreements, guarantees, mortgages, copies of UCC filings and
disclosure forms, and similar agreements or instruments relating to any loan
included in the Assets.
"Loans" includes the Overdraft Loans, Mortgage Loans, Other Personal Loans,
and the Small Business Loans.
"Mortgage Loans" means loans which are secured by a mortgage creating a
lien on real property containing from one to four family residential units
listed on Schedule 1.1F.
"Municipal Deposits" includes all funds on deposit in the accounts of
municipal corporations and other governmental entities listed on Schedules
1.1A&B hereto.
"Other Personal Loans" means any loans which are secured by a security
interest in personal property listed on Schedule 1.1G.
"Overdrafts" means those overdrafts of the book balance of any Deposit
Accounts which have been outstanding for no more than one week at Closing.
"Overdraft Lines of Credit" mean those consumer lines of credit made
available to customers of the Branches as a protection against overdrafts on
Deposit Accounts.
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"Overdraft Loans" means those loans made under Overdraft Lines of Credit.
"Qualified Retirement Plans" means those retirement plans relating to the
Branches for which Seller acts as trustee or custodian under its master or
prototype qualified plan, but which are not administered by Seller's trust
department.
"Real Property" means the real property associated with the Branches which
is owned by Seller or one of its affiliates.
"Real Property Leases" means the leases identified in Schedule 4.6.
"Small Business Lines of Credit" means those committed or uncommitted lines
of credit extended as of Closing to any customer listed on Schedule 1.1C by
Seller's Commercial Lending Department.
"Small Business Loans" means those loans made under Small Business Lines of
Credit or otherwise to any customer listed on Schedule 1.1C.
"Transferred Employee" means each employee of the Branches who is hired by
Buyer under Section 8.1 of this Agreement.
1.2 Accounting Terms.
----------------
To the extent that any accounting terms used in this Agreement are not
defined in Section 1.1, they shall be defined under definitions found in
generally accepted accounting principles.
1.3 Materiality.
-----------
The terms "material" and "material adverse effect" are used in this
Agreement to qualify certain representations of Seller and Buyer and certain
conditions to their respective obligation to proceed to closing. The event or
circumstance described in these representations and conditions will be deemed to
be "material" only if it has (or would be reasonably expected to have) a
material effect on the financial condition, business, or operations of the
Branches, taken as a whole.
II. TRANSFER OF ASSETS AND ASSUMPTION OF LIABILITIES
2.1 Transfer of Assets.
------------------
a) Seller will transfer possession of and all right, title, and interest
in and to the following assets to Buyer (the "Assets") at the close of business
on the Closing Date:
(i) the Real Property;
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(ii) the Fixed Assets;
(iii) Cash on hand in the Branches;
(iv) Except as provided in subsection (b) of this Section 2.1,
the Mortgage Loans, the Overdraft Loans, the Other Personal
Loans, and the Small Business Loans;
(v) Except as provided in subsection (c) of this Section 2. 1,
the Overdrafts; and
(vi) Seller's rights under the Overdraft Lines of Credit, the
Small Business Lines of Credit, and any safe deposit box
rental agreements relating to safe deposit boxes located at the
Branches.
All Assets are transferred without any express or implied warranties (including
the implied warranties of merchantability or fitness for any particular use)
except to the extent otherwise provided in this Agreement.
(b) Subject to the procedures set forth in this subsection, the Assets
shall not include any Overdraft Loan which is more than thirty (30) days past
due on the Closing Date with respect to any payment of principal or interest.
(c) Buyer shall not be obligated but shall have the option to purchase any
Overdraft relating to any account if the aggregate of all overdrafts outstanding
at Closing with respect to that account or any accounts related to that account
exceeds $ 1,000.
2.2 Assumption of Liabilities.
-------------------------
Buyer agrees, on the Closing Date, to assume, pay, perform and discharge
the following liabilities of Seller (the "Liabilities") at their respective book
value, as shown on Seller's books as at the close of business on the Closing
Date:
(a) Subject to Section 9.3(a)(ii), the Deposits and the Deposit Accounts;
(b) Seller's obligations with respect to the Real Property Leases and the
Equipment Leases;
(c) Seller's duties and responsibilities with respect to all Cash Reserve
Lines of Credit and all Small Business Lines of Credit;
(d) Seller's duties and responsibilities with respect to customer safe
deposit boxes held at the Branches;
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(e) Seller's duties and responsibilities with respect to the IRAs; and
(f) Upon acceptance of Municipal Deposits pursuant to Section 9.3(a)(ii),
Seller's duties and responsibilities under the Custody and Security Agreements.
Nothing in this Agreement shall preclude Buyer from amending any term of any
Deposit Account following the Closing to the extent permissible under the
deposit agreement (or any related agreement with the customer) and applicable
law.
2.3 Transfer of Records.
-------------------
(a) Seller also shall transfer to Buyer possession and all right, title,
and interest of and in (i) all books and records maintained at the Branches,
(ii) all signature cards for the Deposit Accounts which are not held at the
Branches, (iii) all Individual Retirement Account Agreements and disclosure
statements which are not held at the Branches, (iv) the Real Property Leases,
(v) the Equipment Leases, and (vi) the Loan Documentation.
(b) Any books and records relating to the Assets, the Liabilities, or the
Branches (including historical information on Deposit Accounts) held by either
Seller or Buyer after Closing shall be maintained in accordance with (and for
the period provided in) that party's standard recordkeeping policies and
procedures. Throughout that period, the party holding any such books and
records shall comply with the reasonable request of the other party to provide
copies of specified documents, at the expense of the requesting party. The
requesting party shall give reasonable notice of any such request. Without
limiting the foregoing and except for the destruction by Seller in the ordinary
course of records which are commingled with records relating to assets and
liabilities which are not related to the Branches, neither party will destroy
any books or records relating to the Assets, the Liabilities, or the Branches
before the fifth anniversary of the Closing without providing forty-five (45)
days written notice to the other party. Subject to any obligation of Seller to
keep the records confidential, the party receiving the notice shall be permitted
to inspect any such records and to take possession of them, provided that it
shall reimburse the party providing the notice for any out-of-pocket expense
incurred in that regard.
2.4 Tax Matters.
------------
(a) Buyer shall pay any sales and use taxes and any interest and penalties
thereon which are payable or arise as a result of this Agreement or the
consummation of the transactions contemplated by this Agreement. The purchase
price for the Fixed Assets other than Real Property assets is their respective
value as noted on
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Seller's books at Closing in accordance with its customary practices and
procedures.
(b) Seller shall pay all real property transfer taxes and real property
transfer gains taxes arising out of the assignment of the Real Property and the
Real Property Leases. The parties shall cooperate in preparing and filing any
real property transfer gains tax forms which may be necessary or advisable
before the Closing Date. The purchase price of the Real Property is the Fair
Market Value of the Real Property. None of the consideration paid under this
Agreement is attributable to the Real Property Leases.
2.5 Matters Relating to the Sale of the Real Property.
-------------------------------------------------
(a) The purchase price of the Real Property shall be the Fair Market Value
of the Real Property, which shall be determined as follows. Promptly after the
execution of this Agreement, Seller and Buyer shall each conduct its own
internal valuation of the Real Property and negotiate in good faith to attempt
to agree on the Fair Market Value of the Real Property. If Seller and Buyer are
unable to agree on the Fair Market Value of the Real Property within thirty (30)
days of the date of this Agreement, then the parties will set the Fair Market
Value of the Real Property by the following appraisal mechanism. Within 40 days
of the date of this Agreement, Seller and Buyer shall each designate in writing
an independent real estate appraiser for the purposes of determining the current
fair market value of the Real Property. The two appraisers shall prepare
written appraisals of the current fair market value of the Real Property on the
basis of its use as it currently is used within thirty (30) days of their
appointment. If the difference between the two appraised values is no more than
twenty percent of the higher appraised value, the Fair Market Value of the Real
Property shall be the average of the two appraised values. If the difference
between the two appraised values is more than twenty percent of the higher
appraised value, the two appraisers shall select an independent appraiser within
ten days of their determination, who shall make its determination of the current
fair market value of the Real Property (without knowledge of the substance of
either of the two final valuations) within thirty (30) days of so being
appointed. The average of the third appraiser's determination and the closer of
the two final values set forth in the reports from the original appraisers shall
be the Fair Market Value. All appraisers designated under this Section shall be
current members in good standing of the American Institute of Real Estate
Appraisers or an equivalent organization. Seller and Buyer shall each pay one
half of the aggregate reasonable fees and expenses of the appraisers.
(b) At least seven (7) days before Closing, Seller shall provide, at its
expense, updated abstracts of title and surveys satisfactory to Buyer for the
Real Property. Buyer shall pay for recording the deed for the Real Property.
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2.6 Proration of Certain Expenses.
-----------------------------
All rentals, real estate taxes, fuel oil costs, utility, water and sewer
charges and assessments, as well as quarterly assessments paid to the Bank
Insurance Fund with respect to the Deposits, shall be adjusted on a pro rata
--------
basis as of the close of business on the Closing Date. Additionally, an
adjustment will be made to reimburse Seller for that portion, if any, of
Seller's Bank Insurance Fund assessment for the next quarterly period commencing
after the Closing Date which reflects the Deposits.
2.7 Back Office Conversion.
----------------------
Seller and Buyer shall cooperate with each other and shall use their
reasonable best efforts (as consistent with their internal day-to-day
operations) in order to cause the timely transfer of information concerning the
Assets and Liabilities which is maintained on Seller's data processing systems
so that Buyer can incorporate the Deposits and the Loans onto its deposit and
loan accounting system no later than the opening of business on the Business Day
following the Closing Date. Upon Buyer's reasonable request, Seller also shall
provide Buyer from time to time before Closing with proposed detailed record
layouts and file descriptions and with computer tapes in Seller's IBM format as
may be reasonably necessary to conduct test conversions. Within fifteen (15)
days after the date of this Agreement, Seller and Buyer shall each designate an
appropriate officer to be responsible for the necessary cooperation of the
parties and another officer to act as an initial contact for questions and
requests for information.
2.8 Processing of Certain Items After Closing.
-----------------------------------------
(a) Buyer and Seller shall promptly agree upon written practices and
procedures (the "Clearing Procedures") under which Seller shall handle in a
prompt and timely manner all items (including, for example, automatic clearing
house and electronic funds transfer items) relating to the Assets or the
Deposits which are presented or returned to Seller on or before the ninetieth
(90th) day following Closing, or such earlier date as is required by applicable
banking laws and regulations. In this regard, Buyer and Seller shall each
designate an appropriate officer within ten (10) days after the execution of
this Agreement to negotiate the Clearing Procedures. When agreed upon by the
parties, the Clearing Procedures shall be attached to this Agreement as Exhibit
2.8. Both parties will comply with the Clearing Procedures, as well as all
applicable regulations, clearing house rules, and agreements, and take all other
reasonable steps to insure that all such items are delivered to Buyer promptly
and in good order, together with a list or computer tape of the same.
(b) The Clearing Procedures shall provide that Buyer will have the benefit
and bear the risk associated with any item which
8
is presented or returned to Seller after Closing provided Seller follows the
Clearing Procedures set forth in Section 2.8(a) above. They also shall provide
that Buyer will pay Seller on a same day basis in immediately available funds an
amount equal to the aggregate amount of all payments made by Seller upon
presentment of these items. All items to be provided to Buyer under this
Section shall be made available for pick-up in accordance with the Clearing
Procedures at Seller's offices located at Grant Avenue, Auburn, New York.
2.9 Information Returns.
-------------------
Buyer shall file all required information returns with the Internal Revenue
Service with respect to interest paid on the Deposits. Seller shall furnish to
Buyer information with respect to interest paid or accrued on Deposits prior to
Closing.
III. BID AMOUNT AND PAYMENTS
3.1 Amount of Premium.
-----------------
In further consideration of Seller entering into this Agreement, Buyer will
pay to Seller, as described in Sections 3.2 and 3.3 of this Agreement, a premium
amount equal to six and one-half percent (6.5%) of the amount of the Deposits
(including accrued but unpaid interest) outstanding at the close of business on
the Closing Date (the "Amount of Premium").
3.2 Payment by Seller.
-----------------
In consideration of Buyer's purchase of the Assets and its assumption of
the Liabilities, Seller shall pay to Buyer an amount equal to the Deposits, as
at the close of business on the Closing Date, less the sum of the following,
calculated as at the close of business on the Closing Date:
(a) The sum of the Fair Market Values of the Real Property;
(b) The value of the Fixed Assets as noted on Seller's books in accordance
with its customary practices and procedures used in preparing financial
statements;
(c) The aggregate principal amounts plus any accrued interest on the
Mortgage Loans, the Overdraft Loans, the Other Personal Loans, and the Small
Business Loans;
(d) The amount of cash on hand at the Branches;
(e) The principal amount of the Overdrafts;
(f) The net amount (which may be a negative amount) of taxes payable by
Buyer and Seller under Section 2.4;
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(g) The net amount (which may be a negative amount) of any adjustment under
Section 2.6; and
(h) The Amount of Premium.
3.3 Settlement.
----------
(a) Not later than the Wednesday immediately preceding the Closing Date,
Seller shall deliver to Buyer a proposed Preliminary Closing Statement, together
with supporting documentation reasonably satisfactory to Buyer, certified by an
appropriate officer, in the form of Exhibit 3.3A to this Agreement, completed as
at the close of business on the third Friday before the Closing Date (except
that the book value of the Fixed Assets as of the close of business on the
Closing Date shall be used). The parties shall agree upon the Preliminary
Closing Statement before the Closing Date, and it shall be the basis of a
preliminary payment to be made to Buyer's account on the Closing Date (the
"Preliminary Payment"). A party's agreement to the Preliminary Closing
Statement shall not be binding with respect to the Final Closing Statement.
(b) Seller shall provide Buyer with a proposed Final Closing Statement,
together with supporting documentation reasonably satisfactory to Buyer,
certified by an appropriate officer within thirty (30) days after the Closing
Date (or on a different date agreed-upon by the parties), and the parties shall
use their best efforts to agree upon the Final Closing Statement promptly. The
Final Closing Statement shall be in the form of Exhibit 3.3B, and it shall be
completed as of the close of business on the Closing Date. On the first
Business Day after Buyer agrees to the Final Closing Statement or Seller is
notified of any determination of the Final Closing Statement under Subsection
(d), Seller shall pay to Buyer (or Buyer shall pay to Seller, as the case may
be) an amount equal to the amount due stated on the Final Closing Statement (the
"Adjustment Payment"), plus interest from the day after the Closing Date until
and including the day before the Adjustment Payment is made at a rate per annum
(calculated daily based on a 360-day year) equal to the "near closing bid"
federal funds rate published in the Wall Street Journal on the Monday following
the Closing Date.
(c) Both the Preliminary Payment and the Adjustment Payment shall be made
by wire transfer of immediately available Fed funds to the account of the party
receiving the payment.
IV. SELLER'S REPRESENTATIONS & WARRANTIES
Seller makes the following representations and warranties as of the date of
this Agreement:
4.1 Power and Authority.
-------------------
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(a) Seller has the corporate power and authority to enter into and perform
this Agreement. The execution and delivery of this Agreement has been duly
authorized by all necessary corporate action by Seller. Upon execution and
delivery by both parties, this Agreement will constitute a valid and binding
obligation of Seller, enforceable in accordance with its terms, subject to
conservatorship, receivership, and a court's right under general principles of
equity to refuse to direct specific performance.
(b) The performance of this Agreement by Seller will not violate any
applicable law, rule, regulation, or order or any material contract or
instrument by which Seller is bound except for such violations which, in the
aggregate, would not reasonably be expected to have any material adverse effect
on the operation of the Branches or the consummation of the transactions
contemplated by this Agreement.
4.2 Litigation and Regulatory Proceedings.
-------------------------------------
There are no actions pending or (to Seller's knowledge) threatened against
Seller which alone, or taken in the aggregate, reasonably would be expected to
have any material adverse effect upon the consummation of the transactions
contemplated by this Agreement. No governmental agency has notified Seller that
it would oppose or not approve or consent to the transactions contemplated by
this Agreement.
4.3 Consents and Approvals.
----------------------
Except for the regulatory approvals mentioned in Section 9.4(a) of this
Agreement and any necessary landlord consents to the assignment of the Real
Property Leases and consents to assignments of Equipment Leases, no consents or
approvals, or filings or registrations with any third party or any public body,
agency, or authority, are necessary in connection with Seller's consummation of
the transactions contemplated by this Agreement.
4.4 Real Property and Fixed Assets.
------------------------------
(a) Schedule 4.4B contains a list of all the Real Property and a non-
exclusive list of the Fixed Assets and equipment leases as of the date of this
Agreement.
(b) Seller has good and marketable title to the Real Property and Fixed
Assets (except for leased equipment), free and clear of all encumbrances, except
for the rights of any tenants and for liens and encumbrances, if any, which do
not detract from the value of or interfere with the use of the Assets, and
current taxes and assessments not delinquent. The Equipment Leases are valid
leases enforceable in accordance with their terms (subject to bankruptcy, other
laws relating to creditors' rights, and a court's right under general principles
of equity to refuse to direct specific
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performance) under which Seller is entitled to use the equipment leased under
the same. No material default has occurred and is continuing under any of the
Equipment Leases.
4.5 Ownership of Loans.
------------------
Seller has good title to the Loans free and clear of all liens and
encumbrances, except for liens and encumbrances, if any, which (a) do not
detract from the Loans' value or interfere with the Loans' use or (b) are in
aggregate amounts not material to the value of the Loans as a whole. Seller is
authorized to assign the Loans to Buyer and, upon the assignment, Buyer will
have the rights of a lender with respect to the Loans.
4.6 Validity of and Compliance with Real Property Leases.
----------------------------------------------------
The leases identified in Schedule 4.6 (the "Real Property Leases") are
valid and existing leases under which Seller, as lessee, is entitled to
possession of the demised premises. No event has occurred, and is continuing,
which constitutes a material default under any of the Real Property Leases.
Subject to Seller obtaining any necessary landlord consents, the assignment of
such leases will transfer to Buyer all of Seller's rights under the Real
Property Leases.
4.7 Financial Information.
---------------------
The Preliminary Closing Statement and Final Closing Statement will be
prepared in accordance with Seller's customary practices and procedures used in
preparing financial statements.
4.8 Taxes.
-----
Seller either has paid all payroll, withholding, property, sales, use, and
transfer taxes imposed by any taxing authority which are due and payable by
Seller with respect to the Branches or their employees, has properly accrued for
the same by reserves shown on Seller's books and records of account, or will
have done one or the other of the foregoing on or before the Closing Date.
Notwithstanding any other provision in this Agreement, Seller shall retain all
right to any refund with respect to any such tax paid.
4.9 Labor Relations.
---------------
No employee located at any Branch is represented for purposes of collective
bargaining by a labor organization of any type, and, to the best of Seller's
knowledge, no labor union is attempting to organize employees of the Branches.
No material claim related to any employee of the Branches is pending or, to
Seller's knowledge, threatened with respect to any civil rights, occupational
safety, or other labor-related statute, regulation, or ordinance which
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might reasonably be expected to have a material adverse effect on the business,
financial condition, or operations of the Branches.
4.10 Insurance.
---------
Seller maintains, or causes to be maintained, insurance on the Branches and
the Assets in amounts and of the kind as may be required or as is customary in
the business of banking.
4.11 Environmental Matters.
---------------------
To the best knowledge of Seller's Executive Officers, neither the Real
Property nor any of the premises subject to the Real Property Leases is, or
during Seller's occupancy of the premises, has been in violation of, or subject
to any liability under, any Environmental Law, except for such violations or
liabilities that, individually or in the aggregate, would not have a material
adverse effect on the Branches. To the best knowledge of Seller's Executive
Officers, there are no actions, suits or proceedings, or demands, claims,
notices of investigation (including without limitation notices, demand letters,
or requests for information from an environmental agency) instituted, pending,
or threatened relating to the Branches, except for liabilities or violations
that would not have, individually or in the aggregate, a material adverse effect
on the Branches.
V. BUYER'S REPRESENTATIONS AND WARRANTIES
Buyer makes the following representations and warranties as of the date of this
Agreement:
5.1 Power and Authority.
-------------------
(a) Buyer has the corporate power and authority to enter into and perform
this Agreement. The execution and delivery of this Agreement has been duly
authorized by all necessary corporate action by Buyer. Upon execution and
delivery by both parties, this Agreement will constitute a valid and binding
obligation of Buyer, enforceable in accordance with its terms, subject to
conservatorship, receivership, other laws relating to creditors' rights, and a
court's right under general principles of equity to refuse to direct specific
performance.
(b) The performance of this Agreement by Buyer will not violate any
applicable law, rule, regulation, or order or any material contract or
instrument by which Buyer is bound except for such violations which, in the
aggregate, would not reasonably be expected to have any material adverse effect
on the consummation of the transactions contemplated by this Agreement.
13
5.2 Litigation and Regulatory Proceeding.
------------------------------------
There are no actions pending or (to Buyer's knowledge) threatened against
Buyer which alone, or taken in the aggregate, reasonably would be expected to
have any material adverse effect upon the consummation of the transactions
contemplated by this Agreement. No governmental agency has notified Buyer that
it would oppose or not approve or consent to the transactions contemplated by
this Agreement.
5.3 Consents and Approvals.
----------------------
Except for the regulatory approvals mentioned in Section 9.3(a) of this
Agreement or such as have been obtained, no consents or approvals, or filings or
registrations with any third party or any public body, agency, or authority are
necessary in connection with Buyer's consummation of the transactions
contemplated by this Agreement.
5.4 Retirement Plan Accounts.
------------------------
Buyer makes available to its deposit customers an individual retirement
account agreement and disclosure statement and a master or prototype qualified
plan which comply in all material respects with all applicable statutes and all
other applicable requirements of the Internal Revenue Service and the United
States Department of Labor. Unless Seller is notified to the contrary in
writing on or before January 31, 1996, Buyer's master or prototype qualified
plans are compatible with Seller's prototype and master plans so that customers
holding Qualified Retirement Plans may adopt Buyer's master or prototype plan
without adverse consequences.
VI. ADDITIONAL AGREEMENTS OF SELLER
6.1 Access to Seller's Premises, Records, and Personnel.
---------------------------------------------------
Upon execution of this Agreement, Seller shall provide Buyer and its
representatives and counsel reasonable and timely access (for purposes of
Buyer's due diligence pursuant to Section 9.3(e)) to the Branches, Seller's
corporate records, financial statements, internal and external audit reports,
findings and written communications, and all other documents and other
information concerning the Branches' business, operations, assets, liabilities,
personnel and condition, financial or otherwise, and appropriate personnel of
Seller, provided that Buyer does not interfere with the Branches' business
operations or those of any other area of Seller. Seller shall not be required
to provide access to or to disclose information where such access or disclosure
might violate or prejudice the rights of any customer or employee or would be
contrary to law or any legal or regulatory order or process. In no event shall
Seller be obligated to furnish income tax returns, or income tax worksheets.
Personnel files shall be furnished to Buyer to the extent permitted by
applicable law and regulations.
14
6.2 Regulatory Approvals.
--------------------
Seller shall use its best efforts to obtain promptly any regulatory
approval on which its consummation of the transactions contemplated by this
Agreement is conditioned. Seller also shall cooperate fully and promptly with
Buyer in obtaining any regulatory approval which Buyer must obtain before
Closing. Seller shall notify Buyer promptly of any significant development with
respect to any application it files under this Section. Seller also shall
provide Buyer with a copy of any regulatory approval it receives under this
Section, promptly after Seller's receipt of the same.
6.3 Conduct of Business.
-------------------
Except as provided in this Agreement and as may be agreed upon otherwise
with Buyer, Seller will continue to carry on the business of banking at the
Branches until Closing only in the ordinary course of business, consistent with
prudent business practices. Seller shall not, without Buyer's prior approval,
make any capital expenditures in excess of $50,000, or terminate the operation
of any Branch, unless those operations cease due to events beyond Seller's
control.
6.4 Indemnification.
---------------
Seller will indemnify Buyer against, and hold it harmless from, all
liability, damages, losses, costs, penalties, and expense (including reasonable
attorneys' fees) relating to (a) any claim against Buyer with respect to the
Assets or the Liabilities to the extent that it arises out of Seller's material
breach of any provision of this Agreement or (b) the enforcement of Buyer's
rights under this Section. If a claim is made against Buyer for which Seller
may be liable under this Section, Buyer shall give prompt notice to Seller of
the Claim and Seller may elect to take over the defense of the claim. Once
Seller takes over the defense of any such claim, it shall have no obligation
under this Section with respect to any attorneys' fees or other legal expense
incurred thereafter by Buyer with respect to that claim. Buyer shall make its
personnel available to Seller and otherwise cooperate reasonably with Seller in
its investigation or defense of any such claim, and Buyer's failure to do so
shall render void Seller's obligations under this Section with respect to that
claim. Buyer shall not settle any claim subject to indemnification under this
Section without Seller's consent.
6.5 Exclusive Arrangement.
---------------------
Unless Seller determines that Buyer has breached any term or condition of
this Agreement in a material respect, Seller will not enter into any agreement
or discussions with any other party with regard to the sale or other disposition
of the Branches; further,
15
Seller will not sell or otherwise dispose of any of the Assets or Liabilities of
the Branches other than in the ordinary course of business of the Branches.
6.6 IRAs and Qualified Retirement Plan Accounts.
-------------------------------------------
Seller shall notify each of its customers holding Deposits under an IRA in
a timely fashion of the assignment of the trusteeship or custodianship of their
IRA. Seller also shall use reasonable efforts to cause customers with Qualified
Retirement Plan accounts at the Branches to adopt Buyer's master or prototype
plan effective at Closing, provided that such an amendment would have no adverse
consequences to the customers or their Plans.
VII. ADDITIONAL AGREEMENTS OF BUYER
7.1 Solicitation of Seller's Customers.
----------------------------------
Buyer shall not solicit business from any customer of the Branches before
Closing, except through customary advertising and marketing practices not
directed specifically at those customers. Buyer may, however, communicate with
customers of the Branches in writing approved by Seller to notify such customers
of the contemplated transaction and encouraging their continued patronage at the
Branches.
7.2 Regulatory Approvals.
--------------------
Buyer will complete and file within thirty (30) days after the date of this
Agreement every application necessary to obtain any regulatory approval on which
Buyer's consummation of the transactions contemplated by this Agreement is
conditioned and use its reasonable best efforts to obtain all such approvals
promptly. In this regard, within ten (10) days after the date of this
Agreement, Buyer shall identify to Seller all information which it requires from
Seller in order to complete these regulatory applications. Buyer also shall
cooperate fully and promptly with Seller in obtaining any regulatory approval
which Seller must obtain before Closing. Buyer shall notify Seller promptly of
any significant development with respect to any application it files under this
Section. Buyer also shall provide Seller with a copy of any regulatory approval
it receives under this Section, promptly after Buyer's receipt of the same.
7.3 Indemnification.
---------------
Buyer will indemnify Seller against, and hold it harmless from, all
liability, damages, costs, losses, penalties, and expense (including reasonable
attorneys' fees) relating to (a) any claims against Seller which arise out of
Buyer's failure after Closing to comply with the Liabilities in any material
respect or out of Buyer's material breach of any provision of this Agreement or
(b)
16
the enforcement of Seller's rights under this Section. If a claim is made
against Seller for which Buyer may be liable under this provision, Seller shall
give prompt and sufficient notice to Buyer of that fact, and Buyer may elect to
take over defense of the claim. Once Buyer takes over the defense of any such
claim, it shall have no obligation under this Section with respect to any
attorneys fees or other legal expense incurred thereafter by Seller in defense
of that claim. Seller shall make its personnel available to Buyer and otherwise
cooperate reasonably with Buyer in its investigation or defense of any such
claim, and Seller's failure to do so shall render void Buyer's obligations under
this Section with respect to that claim. Seller shall not settle any claim
subject to indemnification under this Section without Buyer's consent.
7.4 Confidentiality.
---------------
Buyer shall continue to comply with the Confidentiality Agreement. Buyer's
obligations under this Section shall survive the termination of this Agreement.
7.5 Change of Name, Etc.
-------------------
As soon as practicable after Closing, Buyer will (a) change the name on all
documents and facilities relating to the Assets, the Liabilities, and the
Branches to Buyer's name, (b) notify all persons whose loans, lines of credit,
or deposits are transferred under this Agreement of the consummation of the
transactions contemplated by this Agreement, and (c) provide all appropriate
notices to the appropriate banking authorities, the FDIC and any other
appropriate regulatory authorities required as a result of the consummation of
these transactions. All forms and other documents bearing Seller's name or logo
which are used by Buyer after Closing will be stamped or otherwise marked in
such a way that identifies Buyer as the party using the form or other document.
As soon as practicable and, in any event, within seven (7) calendar days after
the Closing Date provided Seller furnishes to Buyer at least thirty (30) days
prior to Closing Date a magnetic tape containing the relevant account
information, Buyer will issue new checks reflecting its transit and routing
number to customers of the Branches with checking privileges. Buyer shall use
its best efforts to encourage these customers to begin using these checks and
cease using checks bearing Seller's name.
7.6 Continued Operation of the Branches.
-----------------------------------
Buyer shall establish a branch at the present location of each of the
Branches effective at Closing and shall continue to operate each of the Branches
for at least ninety (90) days after Closing, unless the Branch is consolidated
into one of Buyer's branches in such a way that the consolidation will not be
treated as a branch closing for purposes of Section 39 of the Federal Deposit
Insurance
17
Act. In no event shall Seller be required to participate in the closing of any
Branch or in any notice to customers relating to such a closing.
VIII. EMPLOYEES OF THE BRANCHES
8.1 Retention of Employees.
----------------------
(a) Buyer will offer employment to each of Seller's employees who is
employed on an active full-time or part-time basis on the date of this Agreement
at any of the Branches in a position and at a salary comparable to that
currently held by that person. Each and every employee who accepts an offer of
employment from Buyer in connection with the transactions contemplated by this
Agreement is a "Transferred Employee."
(b) Buyer will recognize each Transferred Employee's years of service
accrued under Seller's qualified defined benefit and defined contribution
retirement benefit plans for purposes of vesting and eligibility and will make
any reasonable amendments to those plans which may he necessary or advisable in
this regard. Buyer also will credit each Transferred Employee for his or her
years of service as recognized by Seller for the purpose of Buyer's welfare
benefit plans and policies and for calculating any severance benefits which such
employee might be entitled to receive under Buyer's policy if his or her
employment is terminated by Buyer. If a Transferred Employee has made any
payment during Seller's then-current plan year towards satisfaction of any
deductible required for any given Seller welfare benefit plan, to the extent
permitted by the terms of such plans Buyer will credit that payment against the
Transferred Employee's required deductible under Buyer's comparable welfare
benefit plan, if any. Notwithstanding the foregoing, Buyer will not be
obligated to make plan amendments or provide for years of service or deductibles
paid to the extent it notifies Seller in writing on or before January 31, 1996.
8.2 Training.
--------
Seller shall permit Buyer to train whatever employees of the Branches as
Buyer may specify with regard to Buyer's operations, policies, and procedures.
This training shall take place after normal business hours and may, at Buyer's
option, take place at the Branches. Buyer shall reimburse Seller for any
overtime expense incurred as a result of training activities.
IX. CLOSING AND CONDITIONS TO CLOSING
9.1 Time and Place of Closing.
-------------------------
Closing ("Closing") shall occur on a Friday other than a Friday which falls
in the last week of a calendar quarter to be
18
agreed upon by the parties (the 'Closing Date"), but in no event shall the
Closing Date be more than ninety (90) days after the last regulatory approval
necessary for the Closing has been obtained (without regard to any statutory
waiting periods following such approval). Closing shall be effective as of the
close of business on the Closing Date. Closing shall take place at offices of
Seller's attorneys, Mackenzie Smith Lewis Michell & Hughes, LLP, located at 600
OnBank Building, Syracuse, New York at 10:00 A.M. or such other mutually agreed
upon time on the Closing Date.
9.2 Exchange of Closing Documents.
-----------------------------
Counsel for the parties shall exchange drafts of all documents to be
delivered at Closing (other than the Preliminary Closing Statement) at least
three (3) Business Days prior to the Closing Date.
9.3 Buyer's Conditions to Closing.
-----------------------------
Buyer's obligations to purchase the Assets and assume the Liabilities is
contingent upon and subject to the fulfillment of the following conditions in
all material respects:
(a) (i) Except as provided in (ii) below, the parties obtaining all
regulatory approvals which are necessary for them to proceed with the
transactions contemplated by this Agreement and the expiration of any required
waiting period without the commencement of adverse proceedings by any
governmental authority with jurisdiction over the transactions contemplated by
this Agreement;
(ii) Because Buyer will not have received all regulatory approvals
which are necessary to assume the Municipal Deposits at the Closing, Buyer and
Seller agree that Buyer will pay the Premium applicable to the Municipal
Deposits as of the Closing Date, for future transfer and delivery of the
Municipal Deposits (as such Municipal Deposits then exist) by Seller upon
Buyer's receipt of all such regulatory approvals; provided, however, that If
Buyer has not received such regulatory approvals by December 31, 1996, Seller
may retain ownership of the Municipal Deposits without any further obligation to
transfer such Municipal Deposits to Buyer and may retain the Premium paid.
In further consideration for the Premium paid for the Municipal
Deposits, Seller agrees that Buyer shall hold the funds related to such
Municipal Deposits as agent for Seller and shall administer the funds in the
manner described in Municipal Deposit Procedures set forth in Exhibit 9.3A
hereto. The Seller will continue to maintain the Custody and Security
Agreements until transfer and delivery to the Buyer of the Municipal Deposits,
at which time the Buyer shall assume all of the obligations under such Custody
and Security Agreements.
19
(b) Each express representation, covenant and warranty of Seller in this
Agreement being true and correct in all material respects as of the Closing Date
and all material covenants and conditions of Seller to be performed or met by
Seller on or before the Closing Date having been performed or met in all
material respects;
(c) Seller's delivery to Buyer of the following documents in form and
substance satisfactory to counsel for Seller and Buyer:
(i) The executed Preliminary Closing Statement;
(ii) A warranty deed conveying the Real Property;
(iii) Bills of sale, assignments, and other instruments of transfer
sufficient to convey to Buyer all of Seller's right, title, and
interest in and to the remaining Assets;
(iv) A certificate executed by an appropriate officer of Seller
attesting, to the officer's best knowledge, to Seller's compliance
with the conditions set forth in Section 9.3;
(v) An opinion of counsel executed by Seller's counsel in the form of
Exhibit 9.3;
(d) Buyer's receipt of the Preliminary Payment as provided in Section 3.3.
(e) Completion of due diligence review to the satisfaction of Buyer's
discretion, prior to January 31, 1996. Provided, however, this condition shall
be deemed waived by Buyer unless Buyer terminates this contact by written
communication to Seller on or before January 31, 1996.
9.4 Seller's Conditions to-Closing.
------------------------------
Seller's obligation to sell the Assets and transfer the Liabilities to
Buyer is contingent upon and subject to the fulfillment of the following
conditions in all material respects:
(a) Subject to Section 9.3(a)(ii), the parties' obtaining all regulatory
approvals which are necessary for them to proceed with the transactions
contemplated by this Agreement and the expiration of any required waiting period
without the commencement or threat of adverse proceedings by any governmental
authority with jurisdiction over the transactions contemplated by this
Agreement;
(b) Each express representation, covenant and warranty of Buyer in this
Agreement being true and correct in all material respects as of the Closing Date
and all material covenants and
20
conditions of Buyer to be performed or met by Buyer on or before the Closing
Date having been performed or met in all material respects;
(c) Buyer's delivery to Seller of the following documents in form and
substance reasonably satisfactory to counsel for Seller and Buyer:
(i) One or more executed assumptions of the Real Property Leases;
(ii) One or more executed instruments assuming the remaining
Liabilities;
(iii) A certificate executed by an appropriate officer of Buyer
attesting, to the officer's best knowledge, to Buyer's compliance with
the conditions set forth in Section 9.4(b); and
(iv) An opinion of counsel executed by Buyer's counsel in the form of
Exhibit 9.4.
9.5 Survival of Representations and Warranties.
------------------------------------------
Each and every one of Buyer's and Seller's representations and warranties
under this Agreement or contained in any certificate or instrument delivered by
either party at Closing shall survive for a period of two (2) years following
the Closing Date.
X. TERMINATION
10.1 Termination by Either Party.
---------------------------
Either party may terminate this Agreement upon written notice to the other
if:
(a) As a result of any material breach of any representation, warranty, or
covenant, the party terminating the agreement would be justified in not
proceeding to Closing, but only if (i) the party in breach does not promptly
take reasonable steps to cure the breach or (ii) the breach, by its nature,
cannot be cured substantially by the Closing; or
(b) Closing does not occur prior to June 30, 1996 after the date of this
Agreement, notwithstanding the reasonable best efforts of the party terminating
this Agreement; or
(c) The other party so agrees in writing.
The termination of this Agreement under subsection (a) shall not absolve
the party violating the agreement from any liability to the other party arising
out of its breach of this Agreement.
21
10.2 Termination by Seller.
---------------------
Seller may terminate this Agreement upon written notice to Buyer on or
before February 10, 1996 if on or before January 31, 1996 Seller has received
written notice from Buyer that:
(a) Buyer's master or prototype qualified plan referred to in Section 5.4
hereof is not compatible with Seller's prototype and master plans.
(b) Buyer does not intend to make plan amendments called for in Section 8.1
hereof which will provide Transferred Employees with credit for years of service
or deductibles paid prior to Closing.
10.3 Termination by Buyer.
--------------------
Buyer may terminate this Agreement by written notice to Seller on or before
February 10, 1996 if prior to January 30, 1996 it has not been notified in
writing by Seller that Seller has obtained a written lease for the current
Lansing Branch for a minimum term of eighteen (18) months which lease shall be
assignable to Buyer.
XI. MISCELLANEOUS
11.1 Continuing Cooperation.
----------------------
(a) On and after the Closing Date, Seller agrees to give such further
reasonable assurances and to execute, acknowledge and deliver such bills of
sale, deeds, acknowledgements and other instruments of conveyance and transfer
as in Buyer's judgment are reasonably necessary and appropriate to vest
effectively in Buyer the full legal and equitable title to all the Assets and
Liabilities.
(b) On and after the Closing Date, Buyer shall execute, acknowledge, and
deliver any documents or instruments as may be necessary and appropriate to
relieve and discharge Seller from its obligations with respect to the
Liabilities.
(c) Seller and Buyer shall cooperate fully with each other in connection
with any examination conducted by any tax authority subsequent to the Closing
Date by promptly providing upon request information relating to the tax
liability of any business operated by Seller or Buyer with respect to the
Branches and promptly informing the other of the institution of any material
developments concerning, and the outcome of, the same.
11.2 Merger and Amendment.
--------------------
This Agreement, together with the Confidentiality Agreement, sets out the
complete agreement of the parties with respect to the
22
matters discussed in this Agreement, and supersedes all prior agreements between
the parties, whether written or oral, which apply to these matters. No
provision of this Agreement may be changed or waived except as expressly stated
in a document executed by both parties.
11.3 Disputes.
--------
(a) Neither Seller nor Buyer shall assert any claim arising out of or
relating to this Agreement (except with respect to Buyer's and Seller's
indemnification obligations under Sections 6.5 and 7.3 insofar as they relate to
certain claims asserted against the other party) unless all of the following
tests are met:
(i) The amount in dispute with respect to the claim arising out of a
single incident or group of closely related incidents exceeds
$10,000.00;
(ii) The aggregate amount of all claims by Buyer or Seller (as the
case may be) which satisfy the preceding clause (i) exceed $50,000.00,
in which case a claim may be asserted only to the extent that this
$50,000.00 threshold has been exceeded;
(iii) The aggregate amount of all claims by Buyer or Seller (as the
case may be), including the present claim, does not exceed the Amount
of Premium; and
(iv) The notice required by Section 11.3(b) is submitted on or before
the first anniversary of the Closing.
(b) The parties shall attempt in good faith to resolve any dispute arising
out of or relating to this Agreement promptly by negotiations, as follows.
Either party may give the other party written notice of any dispute not resolved
in the normal course of business. Executives of both parties at comparable
levels at least one step above the personnel who have previously been involved
in the dispute shall meet at a mutually acceptable time and place within ten
(10) days after delivery of such notice, and thereafter as often as they
reasonably deem necessary to exchange relevant information and to attempt to
resolve the dispute. If the matter has not been resolved by these persons
within thirty (30) days of the disputing party's notice, or if the parties fail
to meet within ten (10) days, the dispute shall be referred to more senior
executives of both parties who have authority to settle the dispute and who
shall likewise meet to attempt to resolve the dispute. All negotiations under
this Section are confidential and shall be treated as compromise and settlement
negotiations for purposes of the Federal Rules of Evidence, State rules of
evidence, and common law.
23
(c) Neither party shall have any liability for lost profits or punitive
damages with respect to any claim arising out of or relating to this Agreement.
11.4 Counterparts.
------------
This Agreement may be executed in any number of counterparts, each of which
will constitute an original, but all of which taken together shall constitute
one and the same instrument.
11.5 Exhibits and Schedules.
----------------------
All exhibits and schedules referred to in this Agreement shall constitute a
part of this Agreement.
11.6 Assignment.
----------
This Agreement shall be binding upon and inure to the benefit of the
parties named herein and their respective successors and assigns. Buyer may not
assign this Agreement or any of its rights, interests or obligations hereunder
without the prior written approval of Seller.
11.7 Headings.
--------
The headings contained in this Agreement are inserted for convenience only
and shall not affect the meaning of this Agreement or any of its provisions.
11.8 Notices.
-------
Any notice under this Agreement shall be made in writing and shall be
deemed received when either received or delivered in person, by facsimile
transmission, or by first class mail, postage prepaid, to the parties at the
address set forth below or at such other addresses as each party shall inform
the other in writing.
If to Seller to:
OnBank & Trust Co.
101 South Salina Street
Syracuse, New York 13202
Attn: Mr. Howard W. Sharp
Executive Vice President
with a copy to:
Mackenzie Smith Lewis Michell & Hughes, LLP
600 OnBank Building
Syracuse, New York 13202
Attn: Clayton H. Hale, Jr., Esq.
24
If to Buyer to:
with a copy to:
11.9 Expenses.
--------
Unless specifically stated to the contrary in this Agreement, each party
shall assume and pay for the expenses it incurs with respect to the purchase and
sale of the Assets and assumption of the Liabilities under this Agreement. Each
party shall be responsible for any fee payable to any agent, broker or finder
acting on its behalf in this transaction.
11.10 Public Announcements.
--------------------
Each party shall obtain the approval of the other before making any
announcement or other public communication with respect to the transactions
contemplated by this Agreement and shall furnish a copy of the text to the other
party of the announcement or other communication.
CAYUGA SAVINGS BANK ONBANK & TRUST CO.
By:________________________ By:________________________
25
EXHIBIT 2.8
CLEARING PROCEDURES
Must be completed ten (10) days following execution of Agreement.
26
EXHIBIT 3.3A
(Page 1 of 2)
FORM OF
PRELIMINARY CLOSING STATEMENT
Must be completed Wednesday preceding the Closing Date.
AMOUNT OF LIABILITIES PRELIMINARY
--------------------- -----------
Principal Amount of Deposits ___________________________
Accrued Interest ___________________________
___________________________
(LESS) VALUE OF ASSETS
AND AMOUNT OF PREMIUM
---------------------
Real Property* (_________________________)
Value of Fixed Assets* (_________________________)
Cash on Hand (_________________________)
Loans* (_________________________)
Overdrafts* (_________________________)
Amount of Premium* (_________________________)
TAXES AND PRORATED EXPENSES
---------------------------
Sales Tax (_________________________)
Real Property Transfer and Transfer
Gains Tax ___________________________
Prorated Tax and Expense Items* ___________________________
Payment Amount ___________________________
--------------
*See Attached Schedules for Calculations
27
EXHIBIT 3.3A
(PAGE 2 OF 2)
I certify that I am a ____________________ of OnBank & Trust Co. and that this
Preliminary Closing Statement and the Schedules attached, as well as the
financial information on which both are based, are accurate and complete and
have been prepared in accordance with Seller's customary practices and
procedures used in preparing financial statements.
________________________________
Name:
28
EXHIBIT 3.3B
(PAGE 1 OF 2)
FORM OF
FINAL CLOSING STATEMENT
To be completed thirty (30) days after the Closing Date.
AMOUNT OF LIABILITIES PRELIMINARY FINAL
--------------------- ------------- ------------
Principal Amount of Deposits ___________ __________
Accrued Interest ___________ __________
(LESS) VALUE OF ASSETS
AND AMOUNT OF PREMIUM
---------------------
Real Property* (___________) (__________)
Value of Fixed Assets* (___________) (__________)
Cash on Hand (___________) (__________)
Loans* (___________) (__________)
Overdrafts* (___________) (__________)
Amount of Premium* (___________) (__________)
TAXES AND PRORATED EXPENSES
---------------------------
Sales Tax (___________) (__________)
Real Property Transfer and
Transfer Gains Tax _____________ __________
Plus Prorated Tax and Expense
Items* _____________ __________
Payment Amount _____________ __________
--------------
Prior Payment Amount _____________ __________
Increase (Decrease) from
Prior Payment Amount _____________ __________
29
EXHIBIT 3.3B
(PAGE 2 OF 2)
Interest on Increase (Decrease) ----------
Amount Due from
Seller (Buyer) ----------
*See Attached Schedules for Calculations
I certify that I am a ______________________ of OnBank & Trust Co. that
this Final Closing Statement and the Schedules attached, as well as the
financial information on which both are based, are accurate and complete and
have been prepared in accordance with Seller's customary practices and
procedures used in preparing financial statements.
Name:___________________________
30
EXHIBIT 9.3
(PAGE 1 OF 2)
FORM OF SELLER'S OPINION OF COUNSEL
[BUYER NAME AND ADDRESS]
Gentlemen:
I am a __________________ of OnBank & Trust Co., a New York Trust Company
(the "Bank"), and this opinion is being delivered to you in connection with the
transfer of certain assets and liabilities to ("Buyer") under a Purchase and
Assumption Agreement dated _______________ ____, 1995 between Buyer and the
Bank, as the same has been amended and supplemented as at the time of delivery
of this opinion (the "Agreement"). My opinion set forth below is rendered to
you as provided in Section 9.3 of the Agreement.
Capitalized terms used herein without definition have the same meanings as
set forth in the Agreement.
I am familiar with the operations of the Bank, and in rendering this
opinion I have examined originals, or copies, certified or otherwise identified
to my satisfaction as being true copies, of the Agreement and such corporate
records of the Bank, certificates of public officials and of officers of the
Bank, and such other documents as I have deemed necessary for the purposes of
this opinion. In making this examination, I have assumed the authenticity of
all items submitted to me as originals, the conformity with originals of all
items submitted to me as copies, and the accuracy of the facts stated therein.
On the basis of such examination and my consideration of such questions of
law as I have deemed relevant in the circumstances, I am of the opinion, subject
to assumptions, qualifications, and limitations set forth in this letter, that:
1. The Bank has been duly formed and is validly existing under the laws of
the United States of America. The Bank has the corporate power and authority to
execute and deliver the Agreement and to carry out the provisions of the
Agreement.
31
EXHIBIT 9.3
(PAGE 2 OF 2)
2. The Agreement has been duly authorized by all necessary corporate
action on the part of the Bank and has been duly executed and delivered by the
Bank. The Agreement constitutes a legally valid and binding obligation of the
Bank enforceable against the Bank in accordance with its terms, except as may be
limited by receivership, conservatorship, or similar laws affecting the rights
of creditors generally. The enforceability of the Agreement is subject to the
effect of general principles of equity, including without limitation, concepts
of materiality, reasonableness, good faith and fair dealing, and the possible
unavailability of specific performance or injunctive relief, regardless of
whether considered in a proceeding in equity or at law.
3. The performance of this Agreement by the Bank will not violate any
applicable existing law, rule, regulation, or order, or any material contract or
instrument known to me by which the Bank is bound, except for such violations
which, in the aggregate, would not reasonably be expected to have any material
adverse effect on the operation of the Branches or the consummation of the
transactions contemplated by the Agreement.
4. The execution and delivery of the Agreement by the Bank and the
consummation of the transactions described in the Agreement in accordance with
its terms do not require any approval of any governmental entity to be obtained
on the part of the Bank.
This opinion is made solely under the laws of the United States of America
and the State of New York, and no opinion is offered as to the laws of any other
jurisdiction. This opinion is solely for your benefit in connection with the
Agreement and related transactions and may not be relied upon by, nor may copies
be delivered to, any other person or for any other purpose, without my prior
written consent.
Respectfully submitted,
32
EXHIBIT 9.3A
MUNICIPAL DEPOSIT PROCEDURES
Buyer and Seller shall each designate an appropriate officer within ten
(10) days of the execution of this Agreement to negotiate the Municipal Deposit
Procedures. When agreed upon by the parties, the Municipal Deposit Procedures
shall be set forth below on this Exhibit 9.3A and complied with by the parties.
33
EXHIBIT 9.4
(PAGE 1 OF 2)
FORM OF BUYER'S OPINION OF COUNSEL
_________________________
_________________________
_________________________
Gentlemen:
We are counsel to _________________________ a _________________ ("Buyer"),
and this opinion is being delivered to you in connection with the transfer of
certain assets and liabilities by ______________________ (the "Bank") to Buyer
under a Purchase and Assumption Agreement dated ______________ ___, 1995 as the
same has been amended and supplemented as at the time of delivery of this
opinion (the "Agreement"). Our opinion set forth below is rendered to you as
provided in Section 9.4 of the Agreement.
Capitalized terms used herein without definition have the same meanings as
set forth in the Agreement.
We are familiar with the operations of Buyer, and in rendering this opinion
we have examined originals, or copies, certified or otherwise identified to our
satisfaction as being true copies, of the Agreement and such corporate records
of Buyer, certificates of public officials and of officers of Buyer, and such
other documents as we have deemed necessary for the purposes of this opinion.
In making this examination, we have assumed the authenticity of all items
submitted to us as originals, the conformity with originals of all items
submitted to us as copies, and the accuracy of the facts stated therein.
On the basis of such examination and our consideration of such questions of
law as we have deemed relevant in the circumstances, we are of the opinion,
subject to the assumptions, qualifications, and limitations set forth in this
letter, that:
1. Buyer is a validly existing _____________________ formed under the laws
of _________________ and is authorized thereunder to transact the business of a
___________________ bank. Buyer has the
corporate power and authority to execute and deliver the Agreement and to carry
out the provisions of the Agreement.
34
EXHIBIT 9.4
(PAGE 2 OF 2)
2. The Agreement has been duly authorized by all necessary corporate action
on the part of Buyer and has duly executed and delivered by Buyer. The Agreement
constitutes a legally valid and binding obligation of Buyer enforceable against
Buyer in accordance with its terms, except as may be limited by receivership,
conservatorship, or similar laws affecting the rights of creditors generally.
The enforceability of the Agreement is subject to the effect of general
principles of equity, including without limitation, concepts of materiality,
reasonableness, good faith and fair dealing, and the possible unavailability of
specific performance or injunctive relief, regardless of whether considered in a
proceeding in equity or at law.
3. The performance of this Agreement by Buyer will not violate any
applicable existing law, rule, regulation, or order, or any material contract or
instrument known to me by which Buyer is bound, except for such violations
which, in the aggregate, would not reasonably be expected to have any material
adverse effect on the consummation of the transactions contemplated by the
Agreement.
4. Except for those regulatory approvals that have been obtained, the
execution and delivery of the Agreement by Buyer and the consummation by Buyer
of the transactions described in the Agreement do not require any approval of
any governmental entity to be obtained on the part of the Buyer.
This opinion is made solely under the laws of the United States of America
and the State of New York, and no opinion is offered as to the laws of any other
jurisdiction. This opinion is solely for your benefit in connection with the
Agreement and related transactions and may not be relied upon by, nor may copies
be delivered to, any other person or for any other purpose, without our prior
written consent.
Respectfully submitted,
35
SCHEDULE 1.1
BRANCHES SUBJECT TO THE AGREEMENT
Moravia
-------
31-33 Main Street
Village of Moravia, New York 13138
Cayuga County
Lansing
-------
1935 E. Shore Drive
Lansing Plaza
Town of Lansing, New York 14882
Tompkins County
Lacona
------
8330 Harwood Drive
Village of Lacona, New York 13083
Oswego County
36
SCHEDULE 1.1A
SAVINGS & TIME DEPOSITS
See Attached
37
SCHEDULE 1.1B
DEMAND DEPOSITS
See Attached
38
SCHEDULE 1.1C
SMALL BUSINESS LOANS TO BE
ACQUIRED BY BUYER
See Attached
39
SCHEDULE 1.1E
MORTGAGE LOANS (COMMERCIAL)
See Attached
40
SCHEDULE 1.1F
MORTGAGE LOANS (CONSUMER)
See Attached
41
SCHEDULE 1.1G
OTHER PERSONAL LOANS
See Attached
42
SCHEDULE 1.1H
SAFE DEPOSIT CONTRACTS
See Attached
43
SCHEDULE 4.4B
SCHEDULE OF FIXED ASSETS AND EQUIPMENT LEASES
See Attached
44
SCHEDULE 4.6
REAL PROPERTY LEASES
The following lease agreements, together with any amendments, renewals, or
modifications of or to the same, comprise the Real Property Leases:
45