EXHIBIT 10.23
AGREEMENT TO ORGANIZE AND STOCKHOLDER AGREEMENT
THIS AGREEMENT TO ORGANIZE AND STOCKHOLDER AGREEMENT (this
"Agreement") is dated as of November 5, 1997, and is among
HEARTLAND FINANCIAL USA, INC., a Delaware corporation (the
"Company"), and those individuals who are signatories to this
Agreement (individually referred to as an "Investor" and
collectively as the "Investors").
RECITALS
A. The Company and the Investors (collectively, the
"Organizers") desire to organize a new bank under the laws of the
state of New Mexico with its main office initially to be located
in Albuquerque, New Mexico, and to be known as "Community Bank of
Albuquerque" (the "Bank").
B. Pursuant to the terms of this Agreement, the Organizers
intend to provide the Bank's initial capitalization and to take
all other steps necessary to prepare the Bank to commence retail
operations and transact a banking business and to effect all of
the other actions contemplated by this Agreement (collectively,
the "Transaction").
C. The Organizers understand that the Transaction requires
the approval of the Board of Governors of the Federal Reserve
System (the "Federal Reserve"), the Financial Institutions
Division of the Regulation and Licensing Department of the State
of New Mexico (the "Division"), and the Federal Deposit Insurance
Corporation (the "FDIC").
D. Upon the completion of the organization of the Bank,
the Bank will issue shares of its capital stock (the "Bank
Stock") to each of the Organizers in proportion to their
contributions to the Bank's capitalization and as otherwise
provided in this Agreement.
E. The Organizers desire to impose certain restrictions on
the sale, transfer or other disposition of the Bank Stock owned
by the Organizers and to give the Company and the Investors the
option to purchase and sell the shares of Bank Stock owned by
them under certain circumstances specified in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants
herein contained and for other good and valuable consideration,
the receipt of which is hereby acknowledged, each of the
Organizers, intending to be legally bound hereby, agrees as
follows:
AGREEMENTS
ARTICLE 1
BANK ORGANIZATION AND STOCK SUBSCRIPTION
Section 1.1 Charter. The Organizers agree to use their
best efforts to cause the Division to charter the Bank under the
laws of the State of New Mexico and otherwise to effect the
Transaction. The date the Bank commences a banking business with
the public is referred to as the "Charter Date." Each of the
undersigned hereby authorizes John K. Schmidt, an executive
officer of the Company, to serve as the undersigned's lawful
agent in connection with the Transaction, or if Mr. Schmidt
becomes unable or unwilling to perform such functions, such other
individual as may be chosen by the Company (the "Agent"). The
Agent shall be primarily responsible for preparing and filing all
regulatory applications deemed by him to be necessary to effect
the Transaction, including, but not limited to, applications with
the Federal Reserve, the Division and the FDIC. Each of the
Organizers agrees to cooperate fully with the Agent in such
efforts.
Section 1.2. Subscriptions for Bank Stock. (a) The
Organizers each agree that the Bank's initial capitalization
shall be $15 million. The Company agrees to subscribe for and
purchase $12 million of the initial issuance of Bank Stock and
the Investors agree to subscribe for and purchase, in the
aggregate, $3 million of the initial issuance of Bank Stock.
Individually, each of the Investors agrees to subscribe for and
purchase Bank Stock in the amount set forth opposite his or her
name on Exhibit A attached hereto. The Organizers further agree
that if the Charter Date shall not have occurred within eighteen
months of the date of this Agreement, unless such time is
extended by mutual agreement of the Organizers, this Agreement
shall terminate and each of the Organizers shall: (i) receive a
pro rata portion of any of the subscription funds previously
contributed (after the satisfaction of all expenses incurred in
attempting to organize the Bank, including the preparation and
filing of all necessary regulatory applications as described in
this Agreement); and (ii) accept such distribution in full
satisfaction of any amounts due under this Agreement to or from
any of the other Organizers, including the Company.
(b) Payment by an Organizer of the aggregate cash amount
for the Organizer's subscription for the Bank Stock (the
"Subscription Amount") shall be made in two installments, with
the first installment in an amount equal to 10% of the
Organizer's aggregate Subscription Amount (the "First
Installment"), and the second installment equal to the balance of
the Organizer's Subscription Amount (the "Second Installment").
Each of the Organizers irrevocably agrees to deliver to the Agent
either cash, or check(s) made payable to "Community Bank of
Albuquerque Escrow Fund," in the amount of the Organizer's: (i)
First Installment by no later than 10 days after the date of this
Agreement; and (ii) Second Installment by no later than 15 days
after notice from the Agent requesting payment of such amount.
Section 1.3. Deposit and Expenditure of Organizers'
Funds. All funds collected from the Organizers pursuant to this
Agreement (the "Organizers' Funds") shall be deposited into a
bank account (the "Organization Account") established with the
Dubuque Bank and Trust Company, Dubuque, Iowa (the "Escrow
Bank"). Upon the signature of the Agent, funds may be withdrawn
from the Organization Account to be used to pay normal and
customary expenses relating to the Transaction, including, but
not limited to, the following: (a) expenses arising from or
relating to the organization, capitalization and operation of the
Bank, including the filing of all necessary regulatory
applications with the Federal Reserve, the Division and the FDIC
to effect the Transaction; (b) accounting, auditing, legal,
investment banking, due diligence and appraisal expenses relating
to or in connection with the Transaction; (c) salary payments to
a proposed president of the Bank chosen by the Organizers and to
any other officers or employees of the Bank that are deemed
necessary by the Agent; and (d) other expenses arising from or
directly relating to the Transaction. The Organizers hereby
acknowledge that the Agent may begin making withdrawals from the
Organization Account immediately, and accordingly, if the
Transaction is not consummated, the Organizers will not receive a
refund of 100% of the Organizers' Funds.
Section 1.4. Books and Records. The Agent shall ensure
that proper records of all expenditures from the Organization
Account are maintained and such records shall be available for
inspection by any Organizer. The Agent will prepare and
distribute to each Organizer a monthly financial report and a
copy of the monthly account statement issued by the Escrow Bank
with respect to the Organization Account.
Section 1.5. Additional Capital. Each of the Organizers
agrees that any additional capital needed by the Bank shall be
contributed by the Company in return for the issuance of
additional Bank Stock. Each of the Investors hereby waives any
right granted to him or her by applicable law or otherwise to
subscribe for additional Bank Stock, or if the same is not
waivable, each of the Investors hereby agrees to assign to the
Company any such subscription right as the same may arise in the
future.
ARTICLE 2
REPURCHASE OPTIONS AND OBLIGATIONS
Section 2.1. Repurchase Obligation at Fifth Anniversary.
(a) Upon the fifth anniversary of the Charter Date (the "Fifth
Anniversary"), the Company agrees to purchase from the Investors,
and each of the Investors agrees to sell to the Company, all of
the Bank Stock then owned by the Investors (the "Investors'
Stock") on the terms set forth in this Section. The purchase
price for the Investors' Stock shall be an amount equal to the
"Repurchase Price," as defined below.
(b) Except as provided in this Section, the Repurchase
Price shall be the appraised value of the Investors' Stock as of
the Fifth Anniversary as determined by Alex Sheshunoff Management
Services, Inc. or its successor, or if neither such firm nor its
successor is still in existence and performing appraisals of the
stock of commercial banks, then by an independent, nationally
recognized appraisal firm with no less than 10 years of
experience in appraising the stock of commercial banks, jointly
selected by the Company and the Investors. For purposes of such
an appraisal, the value of the Investors' Stock shall be
determined as if the whole Bank were being sold. In the event
that the Investors have made the initial contact and have
assisted the Company in acquiring additional banks in New Mexico
or in a contiguous state, then the appraisal shall take into
consideration the sale value of the Bank and those additional
subsidiary banks as though they were being sold together in
determining the value of the Investors' Stock.
(c) Notwithstanding anything contained herein to the
contrary, in no event shall the Repurchase Price be less than:
(i) an amount equal to a 15% compounded return on
the Investors' original investment in Bank Stock (e.g., an amount
equal to $6 million based upon an original aggregate investment
by the Investors of $3 million), if on the Fifth Anniversary the
Bank has total assets of not less than $200 million and has
earned at least a 12% return on equity during the prior 12 months
(computed in accordance with generally accepted accounting
principles and based upon average equity during such 12-month
period); or
(ii) an amount equal to a 10% compounded return on
the Investors' original investment in Bank Stock (e.g., an amount
equal to $5 million based upon an original aggregate investment
by the Investors of $3 million) if on the Fifth Anniversary the
Bank has total assets of less than $200 million or has earned
less than a 12% return on equity during the prior 12 months
(computed in accordance with generally accepted accounting
principles and based upon average equity during such 12-month
period).
For purposes of this Section: (i) all references to the total
assets of the Bank shall not include the amount of the assets
(calculated at the time of acquisition) of any bank, thrift or
other financial institution, or any branch, office or part
thereof, acquired by the Bank between the date of this Agreement
and the Fifth Anniversary, and (ii) in computing return on
equity, if the corporate overhead allocation attributed to the
Bank by the Company is greater than that attributed
proportionately to the Company's other subsidiaries (based on the
assets of each subsidiary), then the return on equity calculation
will be adjusted based upon the average allocation per the
combined assets of the subsidiaries.
(d) The Repurchase Price shall be paid to Investors in
two parts: (i) the first part of the Repurchase Price, which
shall be equal to each Investor's total capital contribution as
reflected on Exhibit A attached hereto, shall be paid to the
Investor, at the Investor's election (but subject to compliance
with any applicable securities laws) in cash, common stock of the
Company ("Company Stock") or a combination of cash and Company
Stock; and (ii) the second part of the Repurchase Price, which
shall be equal to the remaining balance thereof, shall be paid to
the Investor, at the Company's election (but subject to
compliance with any applicable securities laws) in cash, Company
Stock or a combination of cash and Company Stock. For purposes
of this Section, the per share value of Company Stock shall be
equal to the average per share value based upon all trades of
Company Stock as reported by the media services of Bloomberg,
L.P., or its successor, during the 90 day period prior to the
Fifth Anniversary.
Section 2.2. Tender Right. Each of the Investors shall
have the right, exercisable at any time after the date hereof and
through the Fifth Anniversary, to tender all of the Bank Stock
owned by such Investor to the Company for purchase at a price
equal to a 10% compounded return on such Investor's original
investment in Bank Stock (the "Tender Right"). An Investor may
exercise the Tender Right by delivering to the Company written
notice of such Investor's intention to tender all of the
Investor's shares of Bank Stock to the Company for purchase.
Upon proper exercise of the Tender Right, the Company hereby
agrees to purchase all of the shares of Bank Stock owned by the
Investor selling such Bank Stock at the purchase price and on the
terms set forth in this Article.
Section 2.3. Reciprocal Right to Purchase. (a) Any time
after the date hereof and through the Fifth Anniversary, the
Company on one hand, and the Investors (considered as a single
party for purposes of this Section) on the other hand, may elect
to terminate this Agreement by offering to purchase 100% of the
Bank Stock owned by the other. The Company may offer to purchase
all of the Bank Stock owned by the Investors, or the Investors
may jointly offer to purchase all of the Bank Stock owned by the
Company (the "Offering Party"), at a cash price per share
specified in a written notice delivered to the other (the "Offer
Notice"). The Offer Notice shall include all other terms and
conditions of any proposed purchase which shall be ordinary and
reasonable for such types of stock purchases. Within 60 days of
receipt of the Offer Notice, the party receiving such notice (the
"Receiving Party") must either: (i) accept the offer described
in the Offer Notice; or (ii) return the Offer Notice to the
Offering Party with a binding offer by the Receiving Party to
purchase all of the Bank Stock owned by the Offering Party at the
same price per share and on the same terms and conditions
specified in the Offer Notice (the "Reoffer Notice"). Upon the
receipt by the Offering Party of a properly tendered Reoffer
Notice from the Receiving Party, the Offering Party shall accept
the terms of the Reoffer Notice and sell its or their Bank Stock
to the Receiving Party on the terms and conditions specified in
the Reoffer Notice.
(b) At the closing of the purchase of the Bank Stock
pursuant to the terms of this Section, the Organizer or
Organizers who sell their Bank Stock shall enter into an
agreement with the purchasing Organizer or Organizers that
prohibits such selling Organizer or Organizers for a period of
two years after such closing from directly or indirectly,
engaging or investing in, owning, managing, operating, financing,
controlling or participating in the ownership, management,
operation, financing or control of, being associated with or in
any manner connected with, lending any of their names or any
similar names, lending credit to or rendering services or advice
to, any bank, savings and loan association, credit union or
similar financial institution that has at the time of such
purchase of Bank Stock been in existence for less than two years
or is formed within two years of the closing and has an office
within 35 miles of any of the offices of the Bank.
Section 2.4. Repurchase Upon Company Change of Control.
If at any time after the date hereof and through the Fifth
Anniversary there is a "Change of Control of the Company" (as
defined below), the Company, or its successor, agrees to purchase
from the Investors, and the Investors agree to sell to the
Company, all of the Bank Stock then owned by the Investors at a
price equal to the Control Premium Price, as defined below. For
purposes of this Section, a "Change of Control of the Company"
shall mean the acquisition by any person or entity (a "Company
Acquirer") of: (a) legal or beneficial ownership (as defined by
Rule 13d-3 promulgated under the Securities Exchange Act of 1934,
as amended) of greater than 66-2/3% of the then issued and
outstanding voting stock of the Company through any transaction;
or (b) all or substantially all of the assets of the Company.
The Control Premium Price shall be equal to the book value of the
Investors' equity interest in the Bank, multiplied by the same
multiple of book value as paid by the Company Acquirer for the
stock or assets of the Company. For example, if the Company is
sold to another entity for three times the Company's book value,
the Control Premium Price would be equal to three times the book
value of the Investors' equity interest in the Bank.
Section 2.5. Terms, Time and Place of Closing. (a) Except
as otherwise specifically provided by the terms of this Article,
the purchase price of any Bank Stock purchased from any Organizer
pursuant to the terms of this Article shall be paid by delivery
of a certified or cashier's check payable to the order of the
selling Organizer or Organizers in the amount of the purchase
price prescribed by the terms of this Article.
(b) Except as otherwise specifically provided by the
terms of this Article, the closing of the purchase and sale of
any Bank Stock to be purchased and sold pursuant to the
provisions of this Article (the "Closing") shall be held at such
place and time and on such date as may mutually be agreed upon in
writing by the Organizer and the purchaser of such Bank Stock,
or, if they fail to agree, at the main office of the Company at
10:00 a.m. on the later of: (a) the tenth business day following
the determination of the purchase price to be paid in connection
with such purchase of Bank Stock; (b) 30 business days following
the action or occurrence that triggers the obligation to purchase
such Bank Stock; and (c) five business days after the receipt of
any necessary regulatory approvals for such purchase.
(c) Except as otherwise specifically provided by the
terms of this Article, at the Closing held pursuant to this
Article, the purchasing Organizer or other entity shall make the
delivery described in subsection (a) of this Section and the
selling Organizer shall deliver to such purchaser free and clear
of all liens, claims and encumbrances (other than those imposed
by this Agreement and evidenced by the legend provided for
below), a certificate or certificates representing the shares of
Bank Stock to be purchased and sold, duly endorsed in blank, with
all taxes on the transfer, if any, paid by the transferor
thereof.
(d) The consummation of any purchase of Bank Stock
pursuant to this Article (the "Sale Stock") shall be subject to
the receipt by the purchaser of any necessary regulatory
approvals, which the purchaser agrees to use its best efforts to
obtain as soon as practicable, provided, however, that if such
purchaser is unable, after the exercise of diligent efforts,
within 120 days after the last date provided in this Agreement
for the closing of the purchase of the Sale Stock, or such longer
period of time as may be mutually agreed upon by the prospective
purchasers and prospective sellers of the Sale Stock, to obtain
any necessary regulatory approvals, then: (i) each of the
prospective sellers of the Sale Stock shall be released from any
further obligations pursuant to the terms of this Agreement
solely with respect to such Sale Stock and shall be free to sell
the Sale Stock to any person or entity free of any lien or
encumbrance imposed by the terms of this Agreement; and (ii) each
of the prospective purchasers of the Sale Stock shall be released
from any further obligations pursuant to the terms of this
Agreement with respect to the purchase of the Sale Stock and
shall have no further rights with respect to the Sale Stock.
ARTICLE 3
REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 3.1. Bank Operations. Each of the Organizers
agrees to use its, his or her best efforts to cause the Bank to
be successful. Each of the Organizers acknowledges and agrees
that in addition to core deposit growth, the Organizers will work
to expand the Bank's operations through selected acquisitions of
banks and other financial institutions, provided, however, that
no offer will be made for any such institution without the prior
consent of the Company.
Section 3.2. Representations, Warranties and Covenants.
Each of the undersigned Organizers hereby represents and warrants
to, and acknowledges to and agrees with, the Agent and each other
Organizer as follows:
(a) The attorney, accountant or financial investment
advisor for the Organizer (collectively, "Advisor") has had a
reasonable opportunity to ask questions of and receive
information and answers from the other Organizers and persons
acting on behalf of the Company or the Bank concerning the
Transaction, all such questions asked have been answered and all
such information requested has been provided to the full
satisfaction of the Organizer or the Organizer's Advisor, and the
Organizer has extensively and on various occasions discussed with
the other Organizers the possible risks of purchasing Bank Stock.
(b) No oral or written representations have been made
or oral or written information furnished to the Organizer or the
Organizer's Advisor(s) in connection with the Organizer's
agreement to purchase Bank Stock which were in any way
inconsistent with the information stated in this Agreement.
(c) The Organizer is not subscribing for Bank Stock as
a result of or subsequent to any advertisement, article, notice
or other communication published in any newspaper, magazine or
similar media or broadcast over television or radio, or presented
at any seminar or meeting, or any solicitation of a subscription
by a person not previously known to each of the undersigned
generally or in connection with investments in securities.
(d) The Organizer's overall commitment to investments
which are not readily marketable is not disproportionate to the
Organizer's net worth and Organizer's investment in the Bank will
not cause such overall commitment to become disproportionate to
the Organizer's net worth.
(e) The Organizer has reached the age of majority in
the state in which the Organizer resides, has adequate net worth
and means of providing for the Organizer's current needs and
personal contingencies, is able to bear the substantial economic
risks of the investment in the Bank as evidenced by this
Agreement, has no need for liquidity in such investment, and, at
the present time, could afford a complete loss of such
investment.
(f) The Organizer has such knowledge and experience in
financial and business matters so as to enable the Organizer to
utilize the information made available to him or her in
connection with this investment in the Bank in order to evaluate
the merits and risks of such an investment and to make an
informed investment decision with respect thereto and the
Organizer has carefully evaluated the risk of such investment.
(g) The Organizer is not relying on the Company, the
Agent, any other Organizer or any other person acting on behalf
of the Company, the Bank, the Agent or the Organizers with
respect to the Organizer's economic considerations relating to
this investment; and in regard to such considerations, the
Organizer has relied on the advice of, or has consulted with, his
or her own Advisor(s).
(h) The Organizer is making the investment evidenced
hereby solely for the Organizer's own account as principal, for
investment purposes only and not with a view to the resale or
participation of any portion thereof, and no other person has a
direct or indirect beneficial interest in such investment.
(i) The Organizer acknowledges that the Company is
under no obligation to register any Company Stock that the
Organizer may receive pursuant to the terms of this Agreement,
and further acknowledges that the receipt by the Organizer of any
Company Stock is subject to the Company's ability to satisfy the
requirements of any applicable federal or state securities laws.
(j) The Organizer acknowledges that a legend will be
placed on each certificate representing the Bank Stock
substantially as follows:
Voluntary and involuntary transfer of any of the
shares represented by this certificate are governed by
and in all respects subject to the terms and conditions
of that certain Agreement to Organize and Stockholders
Agreement among Heartland Financial USA, Inc. and
certain other holders of the Bank's capital stock dated
as of November 5, 1997, an executed copy of which has
been deposited with the Cashier of the Bank at its
registered office in Albuquerque, New Mexico. Such
Agreement imposes certain obligations on the holder of
these shares in certain circumstances, which
obligations and circumstances are described therein.
No transfer of such shares will be made on the books of
the Bank unless accompanied by evidence of compliance
with the terms of such Agreement.
(k) The Organizer recognizes that an investment in
Bank Stock involves a number of significant risks, including,
without limitation, the following considerations:
(i) no Federal or state agency has passed upon
the Bank Stock or made any finding or determination as to the
fairness of the investment in Bank Stock; and
(ii) there is no established market for the Bank
Stock and it is unlikely that a public market for the Bank Stock
will develop.
(l) The Organizer acknowledges receipt of copies of
certain financial and other information concerning the proposed
operations of the Bank, and recognizes that the Bank is a de novo
bank to be organized in the future and has no financial or
operating history, that the organization and operation of the
Bank entails significant risks, including, without limitation,
that the organization of the Bank is subject to regulatory
approvals and that there are no assurances that such approvals
will be obtained.
(m) Within five days after receipt of a request from
the Agent, the Organizer hereby agrees to provide such
information and to execute and deliver such documents as may be
reasonably necessary to complete the necessary applications to
organize the Bank and to comply with any and all laws and
ordinances to which the Bank is subject.
(n) The foregoing representations, warranties and
agreements, together with all other representations and
warranties made or given by the Organizer in any other written
statement or document delivered in connection with the
transactions contemplated hereby, shall be true and correct in
all respects on and as of the date of the delivery of such
statement or document as if made on and as of such date and shall
survive such date.
Section 3.3. Indemnification. Each Organizer agrees to
indemnify and hold harmless the Bank, the Agent and each of the
other Organizers and all of their respective agents and
representatives who are associated with the Transaction and all
of the proposed officers and directors of the Bank against any
and all loss, liability, claim, damage and expense whatsoever
(including, but not limited to, any and all expenses reasonably
incurred in investigating, preparing or defending against any
litigation commenced or threatened or any claim whatsoever)
arising out of or based upon any false representations or
warranty or breach or failure by the undersigned to comply with
any covenant or agreement made by the undersigned herein or in
any other document furnished by the undersigned to any of the
foregoing in connection with the Transaction.
Section 3.4. Additional Information. Each of the
undersigned hereby acknowledges and agrees that the Agent may
make or cause to be made such further inquiry and obtain such
additional information from any of the undersigned as he may deem
appropriate, and each of the undersigned hereby agrees to
cooperate fully with the Agent in this regard.
Section 3.5. Irrevocability; Binding Effect. Each of the
undersigned hereby acknowledges and agrees that: (a) each of the
undersigned is not entitled to cancel, terminate or revoke this
Agreement or any agreements of each of the undersigned hereunder;
and (b) this Agreement and such other agreements shall survive
the death or disability of each of the undersigned and shall be
binding upon and inure to the benefit of the parties and their
heirs, executors, administrators, successors, legal
representatives and assigns.
Section 3.6. Transfer Restrictions. Each of the Investors
hereby agrees that he or she will not sell, exchange, assign,
transfer, pledge, hypothecate, give away (by lifetime transfer)
or otherwise encumber or dispose of any shares of Bank Stock at
any time owned by him or her without the express prior written
consent of the Company, provided, however, that the foregoing
shall not prohibit the transfer of shares of Bank Stock by
testamentary transfer so long as each recipient of any shares of
Bank Stock becomes a party to this Agreement and agrees to be
bound by its terms.
ARTICLE 4
MISCELLANEOUS
Section 4.1. Modification. Neither this Agreement nor any
provisions hereof shall be waived, modified, discharged or
terminated except by an instrument in writing signed by the party
against whom any such waiver, modification, discharge or
termination is sought.
Section 4.2. Notices. All notices, consents, waivers and
other communications under this Agreement must be in writing
(which shall include telecopier communication) and will be deemed
to have been duly given if delivered by hand or by nationally
recognized overnight delivery service (receipt requested), mailed
with first class postage prepaid or telecopied if confirmed
immediately thereafter by also mailing a copy of any notice,
request or other communication by mail with first class postage
prepaid to any Organizer at the address set forth on Exhibit A
attached hereto or to such other person or place as an Organizer
shall furnish to the other Organizers in writing. Except as
otherwise provided herein, all such notices, consents, waivers
and other communications shall be effective: (a) if delivered by
hand, when delivered; (b) if mailed in the manner provided in
this Section, five business days after deposit with the United
States Postal Service; (c) if delivered by overnight express
delivery service, on the next business day after deposit with
such service; and (d) if by telecopier, on the next business day
if also confirmed by mail in the manner provided in this Section.
Section 4.3. Counterparts. This Agreement may be executed
through the use of separate signature pages or in any number of
counterparts, and each of such counterparts shall, for all
purposes, constitute one agreement binding on all parties,
notwithstanding that all parties are not signatories to the same
counterpart.
Section 4.4. Entire Agreement. This Agreement contains
the entire agreement of the parties with respect to the subject
matter hereof and there are no representations, covenants or
other agreements except as stated or referred to herein.
Section 4.5. Severability. Each provision of this
Agreement is intended to be severable from every other provision,
and the invalidity or illegality of any portion hereof shall not
affect the validity or legality of the remainder hereof.
Section 4.6. Assignability. This Agreement is not
transferable or assignable by any of the undersigned.
Section 4.7. Governing Law, Jurisdiction and Venue. This
Agreement shall be governed by and construed in accordance with
the laws of the State of Iowa applied to residents of that state
executing contracts wholly to be performed in that state. Each
of the undersigned irrevocably agrees that any action or
proceeding in any way, manner or respect arising out of this
Agreement or any amendment, instrument, document or agreement
delivered or which may in the future be delivered in connection
herewith shall be litigated only in the courts having situs
within the City of Dubuque, the State of Iowa, and each of the
undersigned hereby consents and submits to the jurisdiction of
any local, state or federal court located within such city and
state. Each of the undersigned hereby waives any right the
Organizer may have to transfer or change the venue of any
litigation brought against the undersigned by the Bank or the
Agent.
Section 4.8. Certificate of Non-Foreign Status. Each of
the undersigned declares that, to the best of the Organizer's
knowledge and belief, the following statements are true, correct
and complete: (a) that unless an Internal Revenue Service Form
4224 has been completed, each of the undersigned is not a foreign
person for purposes of U.S. income taxation (i.e., the Organizer
is not a nonresident alien, nor executing this document as an
officer of a foreign corporation, as a partner in a foreign
partnership, or as a fiduciary of a foreign employee benefit
plan, foreign trust or foreign estate); (b) that the following
information contained elsewhere in the subscription documents is
true, correct and complete: the U.S. taxpayer identification
number (i.e., social security number) and the home address; and
(c) that the undersigned agrees to inform the Bank promptly if
the undersigned becomes a nonresident alien.
Section 4.9. Director Benefits. Directors of the Bank
will be afforded the same benefits as directors of the Company's
other financial institution subsidiaries, including participation
in up to $50,000 (at market value) of the Company's short term
stock options.
Section 4.10. Solicitation of Customers or Employees. For
the period ending two years after an Organizer sells his or her
Bank Stock, such individual shall not, directly or indirectly,
call on, sell to, solicit business from or render services to any
of the Bank's customers or recruit, persuade or attempt to
recruit or persuade any employee of the Bank to leave the Bank's
employ, or to become employed by any other person other than the
Bank. Notwithstanding the foregoing, the provisions of this
Section shall not apply to Norman R. Corzine so long as he is
serving as an operating officer of Access Anytime Bancorp, Inc.,
a Delaware corporation, or First Savings Bank, F.S.B., a federal
savings bank with its main office located in Clovis, New Mexico,
or any successor to either of them.
Section 4.11. Federal and State Securities and Other Laws.
Each of the undersigned should also be aware of the following
additional considerations:
THE INVESTMENTS EVIDENCED BY THIS AGREEMENT ARE NOT, AND THE
BANK STOCK TO BE ISSUED WILL NOT BE, SAVINGS ACCOUNTS OR DEPOSITS
AND ARE NOT AND WILL NOT BE INSURED BY THE FEDERAL DEPOSIT
INSURANCE CORPORATION, ANY OTHER GOVERNMENT AGENCY OR OTHERWISE.
THE INTERESTS EVIDENCED BY THIS AGREEMENT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OR THE SECURITIES LAWS OF ANY
STATES OR UNDER OTHER APPLICABLE BANKING LAWS OR REGULATIONS.
SUCH INTERESTS HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION, ANY STATE SECURITIES
COMMISSION OR OTHER REGULATORY AUTHORITY, NOR HAVE ANY OF THE
FOREGOING AUTHORITIES PASSED UPON OR ENDORSED THE MERITS OF SUCH
INTERESTS. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.
SIGNATURES
IN WITNESS WHEREOF, this Agreement has been executed by the
undersigned Organizers on the date(s) indicated below:
Signature
HEARTLAND FINANCIAL USA, INC.
By: \s\ John K. Schmidt
Title: EVP-CFO
\s\ Dan Hardisty 11/4/97
\s\ J. Badahl & Assoc., 11/5/97
Inc. Profit Sharing
Plan
\s\ Terlun Andrew
Limited Partnership 11/5/97
\s\ J. L. Bratton 11/5/97
\s\ Cornelius J. Higgins 11/5/97
\s\ Norman R. Corzine 11/5/97
\s\ Charles E. Spann 11/5/97
\s\ Sherman McCorkle 11/5/97
\s\ Ben F. Spencer 11/5/97
\s\ Arthur J. Weinstein 2/11/98
\s\ Robert W. Reidy 2/16/98
\s\ Robert H. Scott 2/17/98
\s\ Sundance Mechanical 2/17/98
& Utility Corp.
\s\ Greg Leyendecker 2/17/98
\s\ Stephen Montoya 2/17/98
\s\ Elizabeth Albright 2/16/98
\s\ James A. Clark 2/17/98
\s\ Nadyne Bicknell 2/17/98
\s\ Bob Eaton 2/17/98
\s\ Kerwin Halloway 2/17/98
\s\ Charlie Wilkinson 2/17/98