AGREEMENT OF MERGER
This Agreement of Merger (the "Merger Agreement") is entered into as of
March 1, 2000 by and between California Community Bancshares, Inc. ("CCB") and
Sacramento Capital Co. ("Capital Co.").
RECITALS AND UNDERTAKINGS
A. CCB is a Delaware corporation with its principal office in San
Francisco California. As of the date hereof, CCB has
75,000,000 shares of $0.01 par value common stock authorized
("CCB Common Stock"), and 15,056,277 of such shares are
outstanding. As of the date hereof, CCB has 25,000,000 shares
of $0.01 par value preferred stock authorized, none of which
are issued and outstanding.
B. Capital Co. is a California corporation with its principal
office in San Francisco, California. As of the date hereof,
Capital Co. has 10,000,000 shares of no par value common stock
authorized ("Capital Co. Common Stock"), and 3,340,010 of such
shares are outstanding, all of which are held of record and
beneficially by the California Community Financial
Institutions Fund Limited Partnership. As of the date hereof,
Capital Co. has 10,000,000 shares of no par value preferred
stock authorized, of which 470,000 of Series A Nonvoting
Preferred Stock are issued and outstanding, all of which are
held of record and beneficially by CCB.
C. Pursuant to the Merger Agreement, Capital Co. will be merged
with and into CCB (the "Merger").
D. In consideration of the Merger CCB has agreed to issue shares
of its authorized, but unissued common stock, which shares
shall be issued in a private placement pursuant to Rule 506 of
Regulation D under the Securities Act of 1933, as amended (the
"1933 Act").
E. The Boards of Directors of CCB and Capital Co. have determined
that it would be advisable and in the best interests of their
respective corporations and shareholders for Capital Co. to be
merged with and into CCB, upon the terms and subject to the
conditions set forth in this Agreement and in accordance with
the California General Corporation Law (the "CGCL"), the
Delaware General Corporation Law (the "DGCL"), and other
applicable laws.
F. The Boards of Directors of CCB and Capital Co. have each
approved the Merger Agreement and the transactions
contemplated hereby.
G. Upon consummation of the Merger, CCB will be the surviving
corporation.
AGREEMENT
Section 1. GENERAL
1.1. THE MERGER. On the Effective Date (as defined herein below),
Capital Co. shall be merged with and into CCB, which shall be the surviving
corporation (the "Surviving Corporation"). The Surviving Corporation's name
shall continue to be California Community Bancshares, Inc.
1.2. EFFECTIVE DATE. The merger described herein (the "Merger")
shall become effective, and actions to consummate the Merger shall commence, at
the close of business on the day upon which an executed counterpart of this
Merger Agreement shall have been filed with the Secretary of State of the State
of Delaware in accordance with Section 252 of the Delaware General Corporation
Law and with the Secretary of State of the State of California in accordance
with Section 1108 of the California General Corporation Law (the "Effective
Date").
1.3. CERTIFICATE OF INCORPORATION AND BYLAWS OF THE SURVIVING
CORPORATION. On the Effective Date, the Certificate of Incorporation of CCB, as
in effect immediately prior to the Effective Date, shall be and remain the
Certificate of Incorporation of the Surviving Corporation until amended; the
Bylaws of CCB, as in effect immediately prior to the Effective Date, shall be
and remain the Bylaws of the Surviving Corporation until amended.
1.4. DIRECTORS AND OFFICERS OF THE SURVIVING CORPORATION. On the
Effective Date, the directors and officers of CCB immediately prior to the
Effective Date shall become the directors and officers of the Surviving
Corporation. The directors of the Surviving Corporation shall serve until the
next annual meeting of shareholders of the Surviving Corporation, or until such
time as their successors are elected and qualified.
1.5. EFFECT OF THE MERGER.
(a) ASSETS AND RIGHTS. On the Effective Date and
thereafter, all rights, privileges, franchises and property of CCB and Capital
Co. and all debts and liabilities due or to become due to CCB and Capital Co.
including things in action and every interest or asset of conceivable value or
benefit, shall be deemed fully and finally and without any right of reversion
transferred to and vested in the Surviving Corporation without further act or
deed; and the Surviving Corporation shall have and hold the same in its own
right as fully as the same was possessed and held by CCB or Capital Co.
(b) LIABILITIES. On the Effective Date and
thereafter, all debts, liabilities and obligations due or to become due from,
and all claims and demands for any cause existing against, CCB and Capital Co.
shall be and become the debts, liabilities or obligations of, or the claims or
demands against, the Surviving Corporation in the same manner as if the
Surviving Corporation had itself incurred or become liable for them.
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(c) CREDITORS' RIGHTS AND LIENS. On the
Effective Date and thereafter, all rights of creditors of CCB and Capital Co.
and all liens upon the property of CCB and Capital Co. shall be preserved
unimpaired, and shall be limited to the property affected by such liens
immediately prior to the Effective Date.
(d) PENDING ACTIONS. On the Effective Date and
thereafter, any action or proceeding pending by or against CCB or Capital Co.
shall not be deemed to have abated or been discontinued, but may be pursued to
judgment with full right to appeal or review. Any such action or proceeding may
be pursued as if the Merger had not occurred, or with the Surviving Corporation
substituted in place of CCB or Capital Co. as the case may be.
1.6. FURTHER ASSURANCES. CCB and Capital Co. each agree that at any
time, or from time to time, as and when requested by the Surviving Corporation,
or by its successors or assigns, it will execute and deliver, or cause to be
executed and delivered, in its name by its last acting officers or by the
corresponding officers of the Surviving Corporation, all such conveyances,
assignments, transfers, deeds and other instruments, and will take or cause to
be taken such further or other action as the Surviving Corporation, or its
successors or assigns, may deem necessary or desirable in order to carry out the
vesting, perfecting, confirming, assignment, devolution or other transfer of the
interests, property, privileges, powers, immunities, franchises and other rights
referred to in this Section 1, or otherwise to carry out the intent and purposes
of this Merger Agreement.
Section 2. STOCK OF THE SURVIVING CORPORATION
2.1. STOCK OF CAPITAL CO.. (a) On the Effective Date, each share of
Capital Co. Common Stock issued and outstanding immediately prior to the
Effective Date shall, by virtue of the Merger, be deemed to be exchanged for and
converted into 1.506 shares of fully paid and nonassessable CCB Common Stock. At
and after the Effective Date, no transfer of Capital Co. Common Stock
outstanding prior to the Effective Date shall be made on the stock transfer
books of the Surviving Corporation and the certificates which immediately prior
to the Effective Date represented issued and outstanding shares of Capital Co.
Common Stock shall be deemed by the Surviving Corporation to represent shares of
CCB Common Stock .
(b) At the Effective Time, each share of Series A Nonvoting
Preferred Stock of Capital Co. issued and outstanding immediately prior to the
Effective Date shall, by virtue of the Merger, be cancelled and no shares of CCB
Common Stock or other securities or consideration shall be issued in exchange
therefor.
2.2. STOCK OF CCB. On the Effective Date, each share of CCB Common
Stock issued and outstanding immediately prior to the Effective Date shall,
continue to remain an outstanding share of common stock of the Surviving
Corporation.
2.3. EXCHANGE OF STOCK BY CAPITAL CO. SHAREHOLDER. (a) On the
Effective Date, or as soon as practical thereafter, in order to effectuate the
exchange and conversion specified in Section 2.1, the shareholder of Capital Co.
of record immediately prior to the Effective Date
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shall be allocated and entitled to receive for each share of Capital Co.
Common Stock then held by it a certificate for 1.506 shares of CCB Common
Stock.
(b) FRACTIONAL SHARES. Notwithstanding any other provision hereof, no
fractional shares of CCB Common Stock shall be issued to holders of shares of
Capital Co. Common Stock. In lieu thereof, at the Effective Time each such
holder entitled to a fraction of a share of CCB Common Stock shall receive, at
the time of surrender of the certificate for Capital Co. Common Stock, an amount
in cash equal to $10.00 per share, multiplied by the fraction of a share of CCB
Common Stock to which such holder otherwise would be entitled. No such holder
shall be entitled to dividends, voting rights, interest on the value of, or any
other rights in respect of a fractional share.
Section 3. APPROVALS
3.1. SHAREHOLDER APPROVAL. This Merger Agreement shall be submitted
to the shareholders of CCB and Capital Co. for approval to the extent required
by, and in accordance with, applicable provisions of law.
3.2. REGULATORY APPROVALS. Each of the parties hereto shall proceed
expeditiously and cooperate fully in procuring all other consents and approvals,
and in satisfying all other requirements, prescribed by law or otherwise,
necessary or desirable for the Merger to be consummated, including without
limitation the consents and approvals referred to in Sections 4.1(b), 4.1(c) and
4.1(d).
Section 4. CONDITIONS PRECEDENT, TERMINATION AND PAYMENT OF EXPENSES
4.1. CONDITIONS PRECEDENT TO THE MERGER. Consummation of the Merger
is conditioned upon the following:
(a) Ratification and confirmation of this Merger
Agreement by the shareholders of CCB and Capital Co. to the extent required by,
and in accordance with, applicable provisions of law;
(b) Procuring all other consents and approvals
and satisfying all other requirements, prescribed by law or otherwise, which are
necessary for the Merger to be consummated, including without limitation:
approval from the Commissioner of Financial Institutions of the State of
California pursuant to Section 700 et seq. of the California Financial Code, if
required, approval from the Board of Governors of the Federal Reserve System
under the Bank Holding Act of 1956, approval, if required, and from the
California Commissioner of Corporations under the California Corporate
Securities Law of 1968, as amended, with respect to the securities of the CCB
issuable upon consummation of the Merger, if required;
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(c) There shall have been received (unless
waived by each of the parties hereto) an opinion in form and substance
satisfactory to each of the parties hereto and their counsel, with respect to
the tax consequences to the parties and their shareholders of the Merger;
(d) Procuring all consents or approvals,
governmental or otherwise, which in the opinion of counsel for CCB and Capital
Co., are or may be necessary to permit or to enable the Surviving Corporation to
conduct, upon and after the Merger, all or any part of the businesses and other
activities that CCB or Capital Co. engages in immediately prior to the Merger,
in the same manner and to the same extent that CCB or Capital Co. engaged in
such businesses and other activities immediately prior to the Merger; and
(e) Performance by each of the parties hereto of
all obligations under this Merger Agreement which are to be performed prior to
the consummation of the Merger.
4.2. TERMINATION OF THE MERGER. Notwithstanding that this may have
already been approved by the shareholders of CCB and Capital Co., this Merger
Agreement may be terminated prior to the Effective Time:
(1) By mutual written consent of the Board of Directors of Capital
Co. and CCB;
(2) In the event that any condition specified in Section 4.1
cannot be fulfilled, or prior to the Effective Date the Board of Directors of
either of the parties hereto reaches any of the following determinations:
(a) Any action, suit, proceeding or claim
relating to the Merger, whether initiated or threatened, makes consummation of
the Merger inadvisable; or
(b) Consummation of the Merger is inadvisable
for any other reason;
(3) By either party if the Merger has not been consummated by June
30, 2000.
4.3 EFFECT OF TERMINATION. Upon termination, this Merger
Agreement shall be void and of no further effect, and there shall be no
liability by reason of this Merger Agreement or the termination thereof on the
part of any of the parties hereto or their respective directors, officers,
employees, agents or shareholders.
4.4 EXPENSES OF THE MERGER. All of the expenses of the
Merger, including without limitation filing fees, printing costs, mailing costs,
accountant's fees and legal fees, shall be borne by the Surviving Corporation;
provided, however, that if the Merger is abandoned for any reason, then all of
such expenses shall be paid by CCB.
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Section 5. MISCELLANEOUS
5.1 The Merger Agreement is and will be maintained on file at the
principal place of business of the Surviving Corporation. The address of the
principal place of business of the Surviving Corporation is One Maritime Plaza,
Suite 825, San Francisco, California 94111.
5.2 The Merger Agreement between the parties to the Merger has
been approved, adopted, certified, executed and acknowledged by each of CCB and
Capital Co. pursuant to Section 252 of the DGCL, and executed by the parties in
accordance with the requirements of Chapter 11 of the CGCL.
5.3 The Surviving Corporation agrees that it may be served with
process in the State of Delaware in any proceeding for enforcement of any
obligation of Capital Co., as well as for enforcement of any obligation of the
Surviving Corporation arising from the Merger, including any suit or other
proceeding to enforce the right of any stockholders as determined in appraisal
proceedings pursuant to the provisions of Section 262 of the DGCL.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement of
Merger to be executed by their duly authorized officers as of the day and year
first above written.
CALIFORNIA COMMUNITY BANCSHARES, INC.
By: /s/ Ronald W. Bachi
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Ronald W. Bachli, President
By: /s/ J. Thomas Byrom
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J. Thomas Byrom, Secretary
SACRAMENTO CAPITAL CO.
By: /s/ Richard W. Decker, Jr.
--------------------------------
Richard W. Decker, Jr.,
Chairman of the Board
By: /s/ J. Thomas Byrom
--------------------------------
J. Thomas Byrom, Secretary
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SACRAMENTO CAPITAL CO.
CERTIFICATE OF APPROVAL OF
AGREEMENT OF MERGER
The undersigned hereby certify as follows:
(1) They are the Chairman of the Board and Secretary,
respectively, of Sacramento Capital Co., a California
corporation ("Capital Co.").
(2) The Agreement of Merger in the form attached hereto was duly
approved by the Board of Directors of Capital Co.
(3) Capital Co. has authorized two classes of shares, designated
common stock and preferred stock. The Agreement of Merger has
been duly approved by shareholders holding 100% of the
outstanding shares of voting stock. The total number of shares
outstanding of common stock is 3,340,010, and the number of
shares outstanding of Series A Nonvoting preferred stock is
470,000.
/s/ Richard W. Decker, Jr.
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Richard W. Decker, Jr.,
Chairman of the Board
/s/ J. Thomas Byrom
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J. Thomas Byrom, Secretary
The undersigned declares under penalty of perjury that the matters set forth in
the foregoing certificate are true of his own knowledge.
Executed at San Francisco, California, on March 1, 2000.
/s/ Richard W. Decker, Jr.
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Richard W. Decker, Jr.
/s/ J. Thomas Byrom
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J. Thomas Byrom
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CALIFORNIA COMMUNITY BANCSHARES, INC.
CERTIFICATE OF APPROVAL OF
AGREEMENT OF MERGER
The undersigned hereby certify as follows:
(1) They are the President and Secretary, respectively, of
California Community Bancshares, Inc., a Delaware corporation
("CCB").
(2) The Agreement of Merger in the form attached hereto was duly
approved by the Board of Directors of CCB.
(3) The total number of shares outstanding of common stock of CCB
is 15,056,277. Pursuant to Section 252 of the General
Corporation Law of the State of Delaware, the majority
stockholder of CCB, holding in excess of 90% of the
outstanding shares of common stock, by a vote which exceeded
the 75% vote requirement set forth in the Certificate of
Incorporation of CCB, duly adopted this Agreement of Merger by
a written consent to action without a meeting pursuant to and
in accordance with Section 228 of the General Corporation Law
of the State of Delaware.
/s/Ronald W. Bachli
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Ronald W. Bachli, President
/s/ J. Thomas Byrom
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J. Thomas Byrom, Secretary
The undersigned declare under penalty of perjury that the matters set forth in
the foregoing certificate are true of their own knowledge.
Executed at San Francisco, California, on March 1, 2000.
/s/ Ronald W. Bachli
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Ronald W. Bachli
/s/ J. Thomas Byrom
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J. Thomas Byrom
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