AGREEMENT TO PURCHASE CERTAIN ASSETS
AND ASSUME THE DEPOSITS OF
THE GRINNELL, IOWA OFFICE
OF VANTUS BANK
THIS AGREEMENT is entered into on this 18th day of September, 2008, by and
between LINCOLN SAVINGS BANK ("Buyer"), an Iowa state bank with its principal
place of business in Cedar Falls, Iowa, and VANTUS BANK ("Seller"), a federal
savings bank having its principal place of business in Sioux City, Iowa.
WHEREAS, subject to the terms and conditions of this Agreement, Buyer
desires to purchase certain assets and assume the deposits of Seller's Grinnell,
Iowa, office (the "Office") and Seller desires to sell such assets and transfer
the deposits of the Office to Buyer.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements hereinafter set forth, and for other valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties agree as
follows:
SECTION 1
SALE OF ASSETS
1.1 Sale and Purchase of Acquired Assets. On the Closing Date (as defined
in Section 8.1), subject to the terms and conditions of this Agreement, Seller
shall sell, assign, transfer and convey to Buyer and Buyer shall purchase from
Seller, free and clear of all liens, security agreements and encumbrances of any
kind, all right, title and interest of Seller in and to the following assets
(the "Acquired Assets"):
(a) The real estate locally known as 1025 Main Street, Grinnell,
Iowa, on which the Office is located, and the buildings,
structures, and improvements thereon constituting the operating
premises of the Office, including all equipment, furniture, and
fixtures and also including the Office telephone numbers to the
extent permitted by Seller's telephone provider (the "Operating
Facility"). The legal description of the real estate and a list
of the equipment, furniture and fixtures to be conveyed at the
Office is attached as Schedule A;
(b) Seller's automated teller machine ("ATM") located at Grinnell
College and the cash on hand in the ATM as of the close of
business on the Closing Date;
(c) All loans associated with the Office (the "Loans") and to be
attached to this Agreement as Schedule B on the Closing Date,
including all promissory notes, evidences of indebtedness and
agreements for the payment of money, unfunded loan commitments
and lines of credit, and all related collateral, documents,
instruments, papers, security agreements, financing statements,
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guarantees, abstracts of title, appraisals, financial statements,
payment histories, file notes and all other documentation related
to the Loans (the "Loan Documentation");
(d) All office supplies in Seller's possession at the Office on the
Closing Date other than those with the name or logo of Seller;
(e) All assets related to the safe deposit business, if any,
conducted by the Seller at the Office ("Seller's Safe Deposit
Business"), including all related safe deposit boxes, keys,
signature cards, combinations, prepaid rents (prorated through
the close of business on the Closing Date), customer agreements
(including to all contracts and leases), accounts receivable and
files, books and records, and including custody of all customer
assets held by Seller in safe deposit boxes located at the
Office;
(f) All interest earned, but not collected, on all assets purchased
pursuant to this section;
(g) Pre-paid FDIC insurance premiums related to the Deposits assumed,
if any;
(h) All savings bonds redeemed but not returned related to depositors
or other customers of the Office;
(i) All signature cards, including electronic images, pertaining to
the Deposits (as defined in Section 2.1) and all other files,
documents, books and records in Seller's possession or control
relating to the Deposits including all canceled checks and/or
negotiable orders of withdrawal, deposit agreements, customer
statements and customer correspondence; and
(j) Cash on hand at the Office, including teller cash and vault cash.
1.2 Assets Excluded From Sale. The following assets of Seller shall not be
conveyed and will remain the property of Seller:
(a) All charged-off loans, partially charged-off loans and lines of
credit and other non-ledger assets including recoveries
therefrom;
(b) All prepaid expenses and resulting refunds except maintenance
contracts on equipment acquired by Buyer from Seller;
(c) All insurance and surety bond contracts and the proceeds from any
claims made thereon and the rights to all return premiums;
(d) All rights to tax refunds;
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(e) All contingent claims against directors, officers and employees
of the Seller;
(f) The Southbrooke Green, Ltd. partnership interest;
(g) All loan servicing contracts related to loans sold to the
secondary market; and
(h) Information technology, computers and other equipment related to
Seller's Disaster Recovery Program and personnel training.
SECTION 2
ASSUMPTION OF DEPOSITS
2.1 Liabilities Assumed. On Closing Date, Buyer will assume all deposits
associated with the Office and to be attached as Schedule C on the Closing Date
including accrued and unpaid interest thereon (the "Deposits"). The term
"Deposits" as used herein shall not include deposits of the Office identified on
Schedule C as specifically not being assumed. In addition, Buyer shall assume
the following liabilities to the extent they are related to the operations of
the Office as mutually agreed upon by the parties (together with Deposits, the
"Assumed Liabilities"):
(a) Income collected but not earned on assets of Seller purchased by
Buyer hereunder;
(b) Amounts due to third parties pursuant to service and maintenance
contracts entered into in the ordinary course of business by
Seller and assumed by Buyer pursuant to this Agreement;
(c) Treasury Tax and Loan Accounts held by Seller;
(d) All unfunded loan commitments and lines of credit;
(e) The obligations of Seller under the lease of the copier/printer
located at the Office; and
(f) One-half of the retention bonuses paid to all employees of Seller
assigned to the Office not to exceed twenty one thousand seven
hundred and fifty dollars ($21,750.00).
2.2 Payments of Checks, Drafts and Orders. Buyer hereby agrees, from and
after the Closing, to pay all properly drawn checks, drafts and withdrawal
orders presented to it by mail, over its counters or through clearing by
depositors of the Office, whether drawn on the check or draft forms provided by
Seller or by Buyer, to the extent that the collected deposit balances to the
credit of respective makers or drawers assumed by Buyer pursuant to Section 2.1
of this Agreement are sufficient to permit the payment thereof, and in all other
respects to discharge, in the usual course of conducting a banking business, the
duties and obligations of Seller with respect to the balances due and owing to
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the depositors of the Office assumed by Buyer. Seller shall promptly process all
checks and provide all notices to enable Buyer to meet all statutory and
regulatory deadlines. Buyer shall indemnify, hold harmless, and defend Seller
from and against all claims, losses, and liabilities, including reasonable
attorneys' fees and expenses, arising out of Buyer's acts pursuant to this
section. Seller shall indemnify, hold harmless, and defend Buyer from and
against all claims, losses, and liabilities, including reasonable attorneys'
fees and expenses, arising out of Seller's acts under this section.
2.3 Deposits. Subject to the applicable provisions of law, beginning on the
Closing Date, Buyer hereby agrees to pay interest on all deposits assumed by it
pursuant to Section 2.1 of this Agreement in accordance with the terms of each
written agreement relating to each such deposit and honor all the terms and
conditions of such agreements.
2.4 Informational Reporting and Buyer's Post-Closing Obligations.
(a) Seller shall remain responsible for all federal and state income tax
informational reporting in connection with form 1099 and backup withholding
relating to those liabilities assumed pursuant to Section 2.1 of this Agreement
for all payments prior to the Closing Date. Buyer agrees to be responsible for
all federal and state income tax informational reporting in connection with form
1099 and backup withholding relating solely to those liabilities assumed
pursuant to Section 2.1 of this Agreement for all payments on and after the
Closing Date; provided, however, Buyer shall not assume any liabilities relating
to or arising from Seller's acts or omissions with respect thereto prior to the
Closing Date.
(b) With respect to the real estate described in Schedule A and the
equipment, furniture, and fixtures described in Schedule A, Seller agrees to be
responsible for payment or retain the obligations of (i) all real estate and
personal property taxes and assessments for prior tax years and those that, as
of the Closing Date, are a lien on the property to which they pertain but are
not yet due and payable and (ii) a pro rata share of the real estate taxes for
the fiscal/tax year 2008-2009, said proration based upon the current assessed
value, millage rate and cutback percentage allowed for commercial real estate;
and
(c) Buyer agrees to assume the duties and obligations of Seller arising
after the Closing Date with respect to Seller's Safe Deposit Business including
the maintenance of all necessary facilities for the use of the safe deposit
boxes by the renters thereof during the periods for which such persons have paid
rent therefor in advance to Seller, subject to and in accordance with the
provisions of the applicable leases or other agreements relating thereto, and
Seller's liabilities with respect to all safe deposit rents.
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2.5 Liabilities Not Assumed.
(a) Buyer will not assume, pay, nor perform any liability of Seller
of any kind or nature whatsoever other than the Assumed
Liabilities expressly assumed hereunder.
(b) Without limiting the general and all-inclusive nature of the
foregoing:
(i) Buyer shall not acquire nor take assignment of any employment
contracts, employment liabilities, nor any rights or obligations
relating to Seller's employees, including but not limited to any
retirement, deferred compensation, or employee benefit plans.
(ii) Buyer will not assume or otherwise become liable for any
income, excise, sales, use, gross receipts, franchise,
employment, payroll related, property or any other tax of any
sort relating to the assets, Seller's business, or property of
Seller with respect to any period commenced prior to and
including the Closing Date.
(iii) Buyer will not assume or otherwise be liable for any of the
Seller's Federal Home Loan Bank borrowings or purchased Fed
Funds.
(iv) Buyer will not assume or otherwise be liable for any acts of
the Seller related to its exercise or failure to exercise its
fiduciary responsibilities.
SECTION 3
PAYMENTS
3.1 Premium Payable to Seller. As provided in Section 3.2, the Buyer shall
pay the Seller a premium for the Office equal to the product of the average of
the daily balances as of the close of business on the five (5) business days
prior to and including the Closing Date of the Deposits multiplied by .1058 (the
"Premium").
3.2 Cash Transfer.
(a) If the Book Value of the Assumed Liabilities is less than the Book
Value of the Acquired Assets, then Buyer shall pay to Seller cash equal to the
difference plus the Premium at the Closing.
(b) If the Book Value of the Assumed Liabilities is more than the Book
Value of the Acquired Assets, then Seller shall pay to Buyer cash equal to the
difference less the Premium at the Closing.
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For purposes of this Agreement, "Book Value" means the dollar amount stated
on the books and records of Seller. The Book Value of any item shall be
determined as of the Closing after adjustments made by Seller for differences in
accounts, suspense items, unposted debits and credits and other similar
adjustments or corrections. Without limiting the generality of the foregoing,
the Book Value of a loan shall reflect adjustments for earned or unearned
interest, if any, as of the Closing, in each case as determined for financial
reporting purposes. The Book Value shall not include any adjustment for loan
premiums, discounts or any related deferred income or fees, or general or
specific reserves on the books and records of Seller.
3.3 Loan Servicing Contracts. Within ninety (90) days of the Closing Date
Seller shall have sold its contractual rights to service those loans originated
at the Office and sold to the secondary market (the "Servicing Rights") to
either Buyer or another party. Seller shall first offer the Servicing Rights to
Buyer. If Seller and Buyer cannot reach an agreement on the sale of the
Servicing Rights within forty-five (45) days of the Closing Date, then Seller
shall seek another purchaser of the Servicing Rights.
SECTION 4
REPRESENTATIONS, WARRANTIES AND COVENANTS
4.1 Representations, Warranties and Covenants of Seller. Seller represents,
warrants and covenants to Buyer as follows:
(a) Seller is a federal savings bank duly organized, validly existing
and in good standing under federal law and has all requisite
power and authority to own its assets and carry on its business
as now conducted at the Office, and all charters, licenses,
permits, authorizations and other governmental approvals
necessary therefor and insurance of its deposits by the Federal
Deposit Insurance Corporation are in full force and effect,
except where the failure to be so qualified would not have a
material adverse effect on the Seller;
(b) The execution and delivery of this Agreement and the consummation
of the transactions contemplated hereby have been duly and
validly authorized by the taking of all necessary corporate
proceedings by Seller and, subject to obtaining the required
regulatory approvals, this Agreement is a valid and binding
obligation of Seller. Subject to obtaining the required
regulatory approval, Seller has full power, authority and legal
right to enter into this Agreement and to consummate the
transactions herein contemplated;
(c) The execution and performance of this Agreement does not and will
not violate the provisions of the Charter or Bylaws of Seller, or
the provisions of any note, indenture, mortgage, lease, or other
agreement or instrument to which Seller or its parent company is
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a party or by which Seller or its parent company is bound or
result in the creation of any lien, charge or encumbrance upon
any of the assets sold and purchased hereunder;
(d) Seller has good and marketable title to the Operating Facility,
subject to no liens or encumbrances of any kind or nature;
(e) Seller has good and marketable title to the other assets sold and
purchased hereunder and such assets are subject to no liens or
encumbrances of any kind or nature except for securities pledged
to secure public funds and Treasury Tax and Loan accounts;
(f) Seller carries and until the Closing Date will continue to carry
insurance and bonds with reputable carriers in respect to the
Operating Facility and business substantially of the character
and amount carried by banks similarly situated;
(g) To Seller's Knowledge all loans to be listed on Schedule B and
their related Loan Documentation, are valid and correct in all
material respects, have all necessary signatures, are genuine as
to the signatures of all makers, endorsers, guarantors and other
signatories, were given for valid consideration, properly
perfected and are enforceable in accordance with their respective
terms;
(h) There are no unpaid charges, debts, liabilities, claims or
obligations arising from the construction, ownership or operation
of the Operating Facility which could give rise to any mechanic's
or materialmen's or other statutory or equitable liens against
any such real estate or any part thereof, for which Buyer would
be responsible;
(i) No representation or warranty by Seller in this Agreement nor in
any certificate or other instrument furnished or to be furnished
to Buyer pursuant hereto contains or will contain any untrue
statement of a material fact or omits or will omit to state a
material fact necessary in order to make the statements contained
therein not misleading;
(j) The Operating Facility and the occupancy or operation thereof is
not in violation of any law or any building, zoning, or other
ordinance, code or regulation in such manner as to interfere with
the use and occupancy thereof in the ordinary course of business
of Buyer, except where such violation would not have a material
adverse effect on the use or occupancy by the Seller of the
Operating Facility in the ordinary course of business of Seller;
(k) To Seller's Knowledge: (i) the Operating Facility has been at all
times in compliance with all Environmental Laws (as hereinafter
defined); (ii) there have previously been no conditions on or
about the real estate which required or will require clean-up,
removal, remedial action or other response pursuant to
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Environmental Laws; (iii) there are currently no conditions on or
about the real estate now existing which require or are likely to
require clean-up, removal, remedial action, or other response
pursuant to Environmental Laws. The term "Environmental Laws"
shall mean all federal, state, and local laws including statutes,
regulations, ordinances, codes, rules, and other governmental
restrictions and requirements relating to the environment or
hazardous substances including Iowa Code Chapter 455B, the Toxic
Substance Act, the Clean Air Act, the Clean Water Act, the
Resource Conservation and Recovery Act of 1976, the Comprehensive
Environmental Response, Compensation and Liability Act of 1980,
regulations of the Environmental Protection Agency, regulations
of the Nuclear Regulatory Agency, and regulations of any state
department of natural resources or state environmental protection
agency now in effect;
(l) The Acquired Assets are in proper working condition, except for
normal wear and tear, and from the date of this Agreement, Seller
shall make reasonable efforts to keep such assets in proper
working condition. Any and all transferable warranties for any
Acquired Asset shall be transferred to Buyer on the Closing Date.
Seller has no Knowledge of any material defect in the condition
of the Office. No material remodeling will be done to the
building prior to Closing;
(m) Seller shall cooperate with Buyer, furnish all necessary or
appropriate information and use its best efforts in making
application for regulatory approval of the transactions
contemplated hereby;
(n) Neither Seller nor any of its officers, directors, employees or
agents shall negotiate or contract with any other party for the
sale of the Acquired Assets or the assumption of the Deposits;
(o) If any depositors' accounts are in overdraft on the Closing Date,
Seller guarantees that within 30 days after the Closing all such
overdrafts will be paid by the depositors. Any such overdrafts
remaining unpaid at the end of such 30-day period shall be
presented to the Seller for payment, and Seller shall pay the
amount of the overdraft to Buyer. Buyer agrees to make reasonable
efforts to cooperate with Seller in its collection from a
depositor of any amounts paid by Seller to Buyer hereunder;
(p) Until the Closing Date, Buyer shall have periodic access at
reasonable times mutually agreeable to Seller and Buyer to the
books and records of the Office; and
(q) No employee at the Office is a party to an employment agreement
with Seller.
(r) Seller will use its reasonable best efforts to cause customers of
Seller whose relationship with Seller derives from investment
vehicles associated with the Office as set forth on Schedule D to
transfer such investment relationships from Seller to Buyer,
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subject to applicable legal requirements, including any rights of
such customers to maintain their relationship with Seller.
"Knowledge"--an individual will be deemed to have Knowledge of a
particular fact or other matter if:
(i) that individual is actually aware of that fact or
matter; or
(ii) a reasonable person under similar circumstances would
have known or been aware of that fact.
A person (other than an individual) will be deemed to have Knowledge of a
particular fact or other matter if any individual who is serving, or who has at
any time served, as a director, officer, partner, executor or trustee of that
person (or in any similar capacity) has, or at any time had, Knowledge of that
fact or other matter (as set forth in (i) and (ii) above).
4.2 Representations, Warranties and Covenants of Buyer. Buyer hereby
represents, warrants, and covenants to Seller as follows:
(a) Buyer is an Iowa state bank that is duly organized, validly
existing and in good standing as a state bank under the laws of
the State of Iowa;
(b) The execution and delivery of this Agreement and the consummation
of the transactions contemplated hereby have been duly and
validly authorized by the taking of all applicable corporate
proceedings by Buyer and this Agreement is a valid and binding
obligation of Buyer;
(c) On the Closing Date, Buyer will have all requisite power and
authority to consummate the transactions provided for in this
Agreement;
(d) The execution and delivery of this Agreement and the consummation
of the transactions contemplated herein do not and will not
violate the provisions of the Articles of Incorporation or Bylaws
of Buyer or its parent company or any note, indenture, mortgage,
lease, or other agreement or instrument to which Buyer or its
parent company is a party or by which it is bound;
(e) Buyer shall cooperate with Seller, furnish all necessary or
appropriate information and use its reasonable best efforts in
making application for regulatory approval of the transactions
contemplated hereby. Buyer shall be responsible for and bear the
expense of obtaining all regulatory approvals required for it to
consummate this transaction (but not those required of Seller);
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(f) No representation or warranty by Buyer in this Agreement nor in
any certificate or other instrument furnished or to be furnished
to Seller pursuant hereto contains or will contain any untrue
statement of a material fact or omits or will omit to state a
material fact necessary in order to make the statements contained
therein not misleading;
(g) Although Buyer does not intend to enter into any employment
agreements with employees of Seller, it is Buyer's intention to
retain on at at will basis all of Seller's employees that are
assigned to the Office, and Buyer will honor the years of service
credited to each of Seller's employees at the Office with respect
to the level of benefits provided by Buyer to its employees, and
Buyer will allow any of Seller's employees who become employed by
Buyer upon completion of the transaction, to rollover such
employee's 401(k) Plan assets into Buyer's 401(k) Plan.
4.3 Survival of Warranties and Representations. All warranties and
representations made by the parties in this Agreement shall be deemed to have
been made again on and as of the Closing Date and shall survive the Closing Date
of this Agreement for one (1) year from and after the Closing Date.
SECTION 5
CONDUCT OF BUSINESS UNTIL CLOSING
5.1 Conduct of Business. Until the Closing, Seller shall continue to
conduct the business and operations of the Office and the Operating Facility in
the usual and ordinary course consistent with past practice. Without limiting
the generality of the foregoing, during this period, Seller will do or refrain
from doing the following:
(a) Seller shall continue to pay all interest on the Deposits as such
interest becomes due and payable in the ordinary course of
business;
(b) Seller shall not accept any deposits except in the ordinary
course of business and upon substantially the same terms,
including interest rates, maturities and other applicable terms,
as those generally prevailing at the time for comparable
transactions for similarly situated customers in the Grinnell
market area;
(c) Seller shall make no major changes in its policies and methods of
operation, including interest paid to depositors; and
(d) Seller will make cash payments to each of its employees assigned
to the Office in an amount equal to the cash value of such
employee's accrued paid time off, up to two weeks' of such
employee's pay.
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5.2 Letters to Customers. Seller agrees to deliver to each of Seller's
customers that are depositors at the Office within a reasonable time after the
date of this Agreement a letter setting forth the proposed sale of the Office to
Buyer, including the assumption by Buyer of the Deposits. The letter shall be
subject to the prior approval of the Seller. Any additional notices to Seller's
customers prior to the Closing Date shall be approved in advance by both Seller
and Buyer, which approvals shall not unreasonably be withheld or delayed.
5.3 Data Processing. Seller agrees to assist Buyer and cooperate with Buyer
in the computer data transfer from Seller's data processing server to Buyer's
data processing server related to the Deposits and Loans including Seller's
imaged loan files. Buyer shall be responsible for the costs associated with
services rendered to Buyer by outside third-parties in connection with the data
transfer from Seller's data processing server to Buyer's data processing server.
The parties agree that the data transfer and imaged loan files will require
Seller's cooperation and assistance after the Closing and this obligation shall
survive the Closing.
5.4 Board Approval. The board of directors of Seller shall approve this
Agreement and the consummation of the transactions contemplated by this
Agreement within five (5) business days of the date of this Agreement.
5.5 IRA and Keogh Plan Deposits.
(a) On or before the Closing Date, to the extent that such accounts will
transfer to Buyer, Seller shall: (i) resign as of the close of business on the
Closing Date as the trustee or custodian, as applicable, of each IRA and Keogh
Plan of which it is the trustee or custodian; (ii) to the extent permitted by
the documentation governing each such IRA or Keogh Plan and applicable law,
appoint Buyer as successor trustee or custodian, as applicable, of each such IRA
or Keogh Plan, and Buyer hereby accepts each such trusteeship or custodianship
under the terms and conditions of Buyer's plan documents for its IRA and Keogh
Plans, and assumes all fiduciary and custodial obligations with respect thereto
as of the close of business on the Closing Date; and (iii) deliver to the IRA
grantor or Keogh Plan named fiduciary, of each such IRA or Keogh Plan such
notice of the foregoing as is required by the documentation governing such IRA
or Keogh Plan or applicable law. Buyer shall be solely responsible for
delivering its IRA and Keogh Plan documents to the applicable IRA grantor and
Keogh Plan named fiduciary, including, but not limited to, a beneficiary
designation form to be completed by the applicable IRA grantor or Keogh Plan
participant; provided, however that in the event the IRA grantor or Keogh Plan
participant dies before such time as Buyer receives a properly completed
beneficiary designation form, Seller shall make available to Buyer such
information as may exist in Seller's files regarding any beneficiary designation
it may have regarding such decedent. If, pursuant to the terms of the
documentation governing any such IRA or Keogh Plan or applicable law; (x) Seller
is not permitted to appoint Buyer as successor trustee or custodian, or the IRA
grantor or Keogh Plan or named fiduciary objects in writing to such designation,
or is entitled to, and does, in fact, name a successor trustee or custodian
other than Buyer; or (y) such IRA or Keogh Plan includes assets that are not
Deposits and are not being transferred to Buyer or the assumption of such
deposit liabilities included in such IRA or Keogh Plan or would result in a loss
of qualification of such IRA or Keogh Plan under the Code, all deposit
liabilities of Seller held under such IRA or Keogh Plan shall be excluded from
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the Deposits. Upon appointment as a successor custodian for such IRAs or as a
successor trustee for such Keogh Plans, Buyer shall perform the services and
carry out the duties and obligations required of it under the applicable plans,
the Code and applicable federal and state laws and regulations.
(b) To the extent the Deposits include certain IRAs and Keogh Plans that
are required to make certain periodic distributions to the IRA account owner or
Keogh Plan participant (or beneficiary) either at the account owner's or
participant's request or because the account owner or participant has attained
age 70-1/2, effective as of the Closing Date, Buyer agrees to continue to make
such periodic distributions in accordance with the reasonable distribution
instructions forwarded by Seller to Buyer. Buyer hereby assumes the obligation
to pay each minimum distribution required by federal law by December 31 of the
calendar year in which the Closing occurs and, in consideration thereof, Seller
agrees not to withhold the amount of such distributions from the aggregate
amount of the Deposits.
(c) Prior to the Closing Date, Seller shall provide to Buyer copies of all
plan documents and beneficiary designation forms in Seller's possession with
respect to the IRAs and Keogh Plans.
5.6 No Solicitation of Accounts by Buyer. Prior to the Closing Date,
neither Buyer nor any of its agents or affiliates shall solicit customers of
Seller through advertising specifically referencing or targeted to such
customers of Seller nor transact their respective businesses in such a way which
is reasonably likely to (a) induce such customers to close deposit accounts with
Seller and open deposit accounts directly with Buyer or any of its affiliates,
or (b) result in the transfer of all or a portion of an existing deposit account
from Seller. Notwithstanding the foregoing sentence, Buyer and its affiliates
shall be permitted to (i) engage in advertising, solicitations or marketing
campaigns not primarily directed to or targeted at such customers, (ii) engage
in lending, deposit, or other financial services relationships existing as of
the date hereof with such customers through branch offices of Buyer, (iii)
respond to unsolicited inquiries by such customers with respect to banking or
other financial services offered by Buyer and (iv) provide notices or
communications relating to the transactions contemplated hereby in accordance
with the provisions hereof.
SECTION 6
COVENANT NOT TO COMPETE
For a period of three (3) years after the Closing Date, Seller, its agents,
representatives, parent corporation, and affiliates shall not, directly or
indirectly:
(a) operate, purchase, own, or maintain or have a direct or indirect
interest in any banking, insurance or investment business within
the city limits of Grinnell, Iowa or any municipality or
unincorporated area of Poweshiek County, Iowa;
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(b) solicit the loan or deposit business of any person who is either
(i) a customer of Seller at the Office as of the date of this
Agreement or the Closing Date or (ii) a resident of, or does
business in, Poweshiek County, Iowa, other than through general
advertising that does not specifically target former customers of
Seller; provided however, Seller shall be permitted to solicit
(x) any existing customers of Seller's other branch offices, and
(y) other individuals that reside in Poweshiek County who become
customers of Seller's other branch offices after the Closing Date
as a result of general advertising that does not specifically
target former customers of Seller.
(c) hire, retain or attempt to hire or retain any current employee or
independent contractor of Buyer, provided, however, that this
shall not apply (i) if any such employee shall terminate his/her
employment with Buyer, without direct or indirect inducement or
interference by Seller, or has been terminated by Buyer or any of
its affiliates for any reason or (ii) if such employee is hired
by a Seller or any of its affiliates as a result of a general
solicitation for employment in newspaper advertisements or other
periodicals of general circulation not specifically targeted to
employees of Buyer, or in any way interfere with the relationship
between Buyer and any of its current employees or independent
contractors.
Notwithstanding anything contained in this Section 6 to the contrary, Seller may
purchase whole loans or loan participations from or sell whole loans or loan
participations to any financial institution regardless of where located.
SECTION 7
CONDITIONS PRECEDENT TO CLOSING
7.1 Conditions to Obligation of Buyer. The obligations of Buyer to perform
on the Closing Date are subject to the fulfillment, prior to or on the Closing
Date, of each of the following conditions:
(a) Buyer shall not have discovered any material error, misstatement
or omission in the representations and warranties made herein by
Seller;
(b) Buyer's due diligence examinations of the Office pursuant to
Section 10 shall not disclose a material adverse change in the
Deposits between the date of this Agreement and the Closing Date,
as reasonably determined by Buyer; provided, however, that
changes in interest rates paid by Seller with respect to its
sources of borrowed funds, including deposits, repurchase
agreements and Federal funds purchased, which changes are caused
by general money market fluctuations shall not be considered in
determining what shall constitute such a material adverse change;
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(c) Seller shall have performed and complied in all material respects
with all of the terms, agreements, covenants, and conditions
required by this Agreement to be performed and complied with by
Seller prior to or on the Closing Date;
(d) No claim, suit, action or other proceeding shall have been
instituted or threatened before any court or governmental body,
or by any public authority, to restrain or prohibit the
consummation of the transactions contemplated herein or to obtain
damages or other relief in connection with this Agreement;
(e) Buyer shall have obtained all requisite regulatory approvals
required by applicable law or governmental regulations necessary
or appropriate to enable Buyer to acquire the Operating Facility,
and assume the Deposits. Such regulatory approvals include, but
are not limited to the FDIC and the Iowa Division of Banking; and
(g) Seller shall have delivered to Buyer all instruments and document
which may be required to vest in Buyer all of Seller's right,
title and interest in and to the Operating Facility and the Loan
Documentation, including a warranty deed for the Operating
Facility, a bill of sale for all loans, equipment, furniture,
fixtures and other personal property, assignments of all leases
and assignments of all safe deposit box rental agreements.
7.2 Conditions to Obligations of Seller. The obligations of Seller to
perform on the Closing Date are subject to the fulfillment, prior to or on the
Closing Date, of each of the following conditions:
(a) Seller shall not have discovered any material error, misstatement
or omission in the representations and warranties made herein by
Buyer;
(b) Buyer shall have performed and complied in all material respects
with all of the terms, agreements, covenants and conditions
required by this Agreement to be performed and complied with by
Buyer prior to or on the Closing Date; and
(c) No claim, suit, action or other proceeding shall have been
instituted or threatened before any court or governmental body,
or by any public authority, to restrain or prohibit the
consummation of the transactions contemplated herein or to obtain
damages or other relief in connection with this Agreement.
7.3 Termination. This Agreement and the transactions contemplated by this
Agreement may be terminated at any time on or before the Closing Date:
(a) By written notice by Buyer to Seller if one or more of the
conditions set forth in Section 7.1 shall not have been satisfied
or if Buyer determines such conditions cannot or will not be
satisfied for any reason; or
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(b) By written notice by Seller to Buyer if one or more of the
conditions set forth in Section 7.2 shall not have been satisfied
or if Seller determines such conditions cannot or will not be
satisfied for any reason; or
(c) By the mutual written consent of Buyer and Seller; or
(d) By written notice by Buyer or Seller to the other party if the
Closing Date is not on or prior to January 31, 2009.
Upon the termination provided above, all rights, obligations, duties and
liabilities among the parties hereto with respect to the subject matter of this
Agreement shall be extinguished, provided, however, that, if this Agreement is
terminated because of a willful breach of this Agreement by the non-terminating
party or because one or more of the conditions to the terminating party's
obligations under this Agreement is not satisfied as a result of the party's
intentional failure to comply with its obligations under this Agreement, the
terminating party's right to pursue all legal remedies will survive such
termination unimpaired. Buyer and Seller shall have the right to waive any of
the conditions precedent for their benefit and any breach or default on the part
of the other party hereto. The parties may extend the deadline set forth in
subsection (d) by mutual consent which will not be unreasonably withheld.
SECTION 8
CLOSING
8.1 Closing Date and Location. The closing of this transaction (the
"Closing") shall take place on December 15, 2008 or such other time and place
mutually agreed upon by the parties on a day which is not more than thirty (30)
calendar days following the receipt of all requisite regulatory approvals and
the expiration of all waiting periods imposed by law or by rule, regulation or
order of any regulatory authority having jurisdiction over the subject matter of
this Agreement (the "Closing Date").
8.2 Items to be Delivered by Seller at Closing. In addition to the items
required to be delivered to Buyer by Seller pursuant to the other terms of this
Agreement, on or before the Closing Date, Seller shall deliver to Buyer the
following:
(a) Such instruments of sale, assignment, conveyance and transfer,
including but not necessarily limited to a warranty deed in a
form substantially similar to the one attached as Exhibit 1 and a
Bill of Sale in a form substantially similar to the one attached
as Exhibit 2, both duly executed in and in form and content
satisfactory to counsel for Buyer, as are necessary or
appropriate to vest in Buyer good and marketable title to and
possession of the Operating Facility and other Acquired Assets
described in Section 1;
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(b) All records pertaining to the Loans, Loan Documentation and
Deposits which are necessary or appropriate to enable Buyer to
conduct the banking business previously conducted by Seller at
the Office such as signature cards, contracts between Seller and
its depositors, deposit slips, cancelled checks and all other
records relating to the Deposits;
(c) Seller's keys to the safe deposit boxes and Seller's records
related to the safe deposit boxes at the Office;
(d) Such other Acquired Assets as shall be capable of physical
delivery;
(e) A certificate of a proper officer of Seller, dated the Closing
Date, certifying to fulfillment of all conditions which are the
obligation of Seller and that all of the representations and
warranties of Seller set forth in this Agreement remain true and
correct in all material respects on the Closing Date;
(f) Certified copies of a resolution of the Board of Directors of
Seller approving the sale of the Office;
(g) Consents of any third parties necessary to permit the valid and
effective assumption of the Deposits or acquisition of the
Operating Facility;
(h) Such certificates and other documents as Buyer and its counsel
may reasonably require to indicate the receipt by Seller of all
necessary corporate and regulatory authorizations and approvals
for the consummation of the transactions provided for in this
Agreement;
(i) Schedules B and C, approved by Buyer who may reject any Loan or
Deposit proposed by Seller to be listed on the respective
schedules, provided that Buyer must provide a reasonable
commercial explanation to Buyer for any such rejection. Seller
shall deliver to Buyer a draft of Schedules B and C at least five
(5) business days prior to the Closing Date;
(j) If the condition of Section 3.2(b) is met, the cash due from
Seller to Buyer pursuant to Section 3.2(b).
8.3 Items to be Delivered by Buyer at Closing. In addition to the items
required to be delivered to Seller by Buyer pursuant to the other terms of this
Agreement, on or before the Closing Date, Buyer shall deliver to Seller the
following:
(a) A certificate and receipt acknowledging the delivery and receipt
of possession of the property and records referred to in this
Agreement;
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(b) Certified copies of a resolution of the Board of Directors of
Buyer approving the purchase of the Office;
(c) Such certificates and other documents as Seller and its counsel
may reasonably require to evidence the receipt by Buyer of all
necessary corporate and regulatory authorizations and approvals
for the consummation of the transactions provided for in this
Agreement;
(d) An assumption agreement in a form substantially similar to the
one attached as Exhibit 3 whereby Buyer assumes and agrees to pay
or perform those liabilities and obligations of Seller, which
Buyer has specifically agreed herein to pay or perform;
(e) All regulatory approvals necessary to permit the valid and
effective sale, assignment, transfer and conveyance to Buyer of
the Operating Facility and the transfer and assumption of the
Deposits;
(f) A certificate of a proper officer of Buyer, dated the Closing
Date, certifying to fulfillment of all conditions which are the
obligation of Buyer and that all of the representations and
warranties of Buyer set forth in this Agreement remain true and
correct in all material respects on the Closing Date; and
(g) If the condition of Section 3.2(a) is met, cash due from Buyer to
the Seller pursuant to Section 3.2(a).
8.4 Rejection of Loans. For a period of one ninety (90) days following the
Closing, Buyer shall have the right to return to Seller at any time or times any
Loan sold to Buyer at the Closing and any loan commitment or line of credit that
were assumed pursuant to Section 2.1, provided that Buyer must provide a
reasonable commercial explanation to Buyer for any such return. For each loan
returned to Seller, Buyer shall be entitled to receive from Seller in exchange
for the Loan and related Loan Documentation an amount equal to the Book Value of
the Loan on the Closing Date less any principal payments received.
SECTION 9
POST-CLOSING MATTERS
9.1 Right to Collect. After Closing, Buyer shall have the sole right to
make collections with respect to all Loans sold hereunder.
9.2 Notice to Borrower. Seller will send notices to each person who is
obligated on each Loan that the Loan has been sold, transferred and assigned to
Buyer. All such notices shall be mailed or delivered by Buyer and shall be in a
form prepared by Buyer and approved by Seller. Seller will thereafter promptly
turn over to Buyer, in the form received and properly endorsed, all checks,
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drafts, money orders or other instruments of payment that may come into the
possession of Seller as payment of the Loans sold hereunder.
9.3 Power of Attorney. Effective as of the Closing Date, Seller hereby
names, constitutes and appoints Buyer and any of its officers, agents, employees
or representatives its duly authorized attorney and agent with full power and
authority to endorse notes, and/or security instruments, or any other such
documentation relating to the Loans sold hereunder in Seller's name, to receive
and collect any and all monies due under such Loans and to enforce performance
of all such Loans and instruments covered thereby, including the assignment of
mortgages, security agreements and financing statements.
9.4 Modification of Loans. With respect to all Loans sold hereunder, Buyer
shall have the right to release any and all instruments of record or any debtors
or guarantors of such instruments of record and to supplement or replace such
instruments, debtors or guarantors with any like or similar instruments, debtors
or guarantors, to extend or modify periods of time of payment or any other terms
or provisions of such instruments and generally to do and perform any and all
things necessary and incident to collection of the Loans sold hereunder with
equal rights, privileges and powers which Seller has or was entitled to
exercise.
9.5 Seller as Agent. For a period not to exceed 120 days after the Closing
Date, Seller agrees to receive on behalf of Buyer all Federal recurring payments
and automated clearing house ("ACH") transfers directed to Seller, and to act as
Buyer's collecting bank for the receipt of checks, drafts, negotiable orders of
withdrawal, and electronic fund transfers drawn before or after the Closing Date
on Deposits assumed by Buyer in accordance with the procedures to be agreed upon
by the parties. In executing its duties under this Section, Seller is acting
only as agent for the collection of items drawn on Buyer. Seller shall not
supply any missing endorsements, or act as collecting bank for returned
deposits, or, except as otherwise specifically provided in this Agreement, act
as returning bank for any items not paid by Buyer. Unless caused by the gross
negligence or willful misconduct of Seller, any risks of loss associated with
the interim servicing, including any risk of loss associated with insufficient
funds, shall be the responsibility of Buyer. Buyer shall indemnify, hold
harmless, and defend Seller from and against all claims, losses, and
liabilities, including reasonable attorneys' fees and expenses, arising out of
Buyer's acts pursuant to this section.
9.6 Payment of Items Delivered by Seller. For a period not to exceed 120
days after the Closing Date, Buyer agrees to honor and pay all properly payable
drafts, checks, negotiable orders of withdrawal, or electronic fund transfers
delivered by Seller, drawn on or chargeable to the Deposits, provided they are
not stale, subject to stop payment orders, or drawn on insufficient funds.
9.7 Return of Items. Buyer agrees to be solely responsible for the return
of any Federal recurring payments, ACH transactions, checks, drafts, negotiable
orders of withdrawal, or electronic fund transfers delivered by Seller to Buyer
under this Section 9.
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9.8 Notice of Return. Seller agrees to notify Buyer of the return to it of
any items deposited in, or cashed at, the Office prior to the Closing Date and
shall expeditiously forward any such items to Buyer. At Closing, Seller shall
notify Buyer which amounts in which deposit accounts are not immediately
available funds, and Buyer shall not make such funds available to customer prior
to the time required by law. If Buyer cannot recover on such items after a good
faith commercially reasonable effort, Seller shall reimburse Buyer for such
items upon assignment of such items by Buyer to Seller. However, Buyer shall not
be obligated to initiate any suit in law or equity in order to have its actions
or efforts under this Section 9.8 constitute good faith or commercially
reasonable efforts.
9.9 Settlement. The parties agree to settle for the transactions described
in this Section 9 on a daily basis by wire transfer of immediately available
funds in accordance with procedures to be agreed upon by them.
9.10 Records. In the event Buyer needs records relating to the servicing of
a deposit that predates or are not included in the records assigned under this
Agreement in order to resolve a dispute or inquiry, Seller will make a good
faith effort to provide such information and copies of pertinent documents in
accordance with applicable law and its standard retention practices.
9.11 Stop Payment Orders. Buyer shall honor all stop payment orders
initiated on or prior to the Closing Date. If Buyer makes a payment in violation
of any such order, Buyer shall be solely liable for such payment and shall
indemnify Seller from and against all claims, losses and liabilities, including
reasonable attorneys' fees and expenses, relating to such payment. In the event
that Buyer shall make any payment in violation of a stop payment order initiated
on or prior to the Closing Date but not reflected in stop payment documents
delivered to Buyer prior to such payment, Seller shall indemnify, hold harmless,
and defend Buyer from and against all claims, losses, and liabilities, including
reasonable attorneys' fees and expenses, arising out of any such payment.
9.12 Assignment of Items. Buyer and Seller will make appropriate
arrangements pursuant to which Buyer shall assign to Seller and Seller will
fully recompense Buyer for:
(a) Items returned to Buyer on account of negligence, errors, or
improper banking practices or procedures by Seller, or forgery or
fraud, which are drawn on or chargeable to the Deposits and for
which the transaction date on the item was on or prior to the
Closing Date; and
(b) Items returned to Buyer for "uncollected funds" which are drawn
on or chargeable to the Deposits, for which the transaction date
on such returned item is on or prior to the Closing Date.
9.13 Notice to Depositors. As soon as practicable after the date Buyer
receives written notice of regulatory approval of the transactions contemplated
by this Agreement, Seller and Buyer shall give notice to depositors of Seller
who have Deposits listed on Schedule C of the timing and fact of Buyer's
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assumption of the Deposit liabilities and respective deposit agreements of
Seller to the extent such assumption is provided for herein, along with
practical information required to transfer the accounts to Buyer's system, by
mailing to each such depositor a joint notice with respect to such matters.
Buyer agrees that it will obtain prior approval from Seller, which approval will
not be unreasonably denied, of any such notices and of any advertisements which
refer to, or use the name of, Seller and that such notices and advertisements
shall not be mailed or published until such approval is received. Seller will
act upon all requests for such approval within two (2) business days of the
request. Failure to act within the two (2) business day period shall be deemed
approval by Seller. Immediately after Buyer's receipt of regulatory approval of
the transactions contemplated by this Agreement, Seller shall provide Buyer with
all information needed to generate the notices contemplated by this Section
9.13.
SECTION 10
DUE DILIGENCE
10.1 Follow-up Due Diligence. As soon as practicable after receipt by Buyer
of all required regulatory approvals, but at least five (5) business days prior
to the Closing Date, Buyer shall be given the opportunity to conduct such due
diligence investigation of the books, records and properties of the Office and
the Operating Facility as Buyer deems appropriate.
SECTION 11
INDEMNIFICATION
11.1 Indemnification and Reimbursement by Seller.
(a) For a period of three (3) years from the Closing Date, Seller will
indemnify and hold harmless Buyer, and its agents, representatives,
shareholders, subsidiaries and affiliates (collectively, the "Indemnified
Persons"), and will reimburse the Indemnified Persons for any loss, liability,
claim, damage, expense (including costs of investigation and defense and
reasonable attorneys' fees and expenses) or diminution of value, whether or not
involving a Third-Party Claim (collectively, "Damages"), arising from or in
connection with:
(i) any breach of any representation or warranty made by Seller in this
Agreement;
(ii) any breach of any covenant or obligation of Seller in this Agreement
or in any other certificate, document, writing or instrument
delivered by Seller pursuant to this Agreement;
(iii) any liability arising out of or resulting from any act or omission
by Seller or any of its directors, officers, employees or agents
prior to the Closing Date; or
(iv) any retained liabilities pursuant to Section 2.5.
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(b) For a period of three (3) years from the Closing Date, Buyer will
indemnify and hold harmless Seller, and its agents, representatives,
shareholders, subsidiaries and affiliates (collectively, the "Indemnified
Persons"), and will reimburse the Indemnified Persons for any loss, liability,
claim, damage, expense (including costs of investigation and defense and
reasonable attorneys' fees and expenses) or diminution of value, whether or not
involving a Third-Party Claim (collectively, "Damages"), arising from or in
connection with:
(i) any breach of any representation or warranty made by Buyer in this
Agreement;
(ii) any breach of any covenant or obligation of Buyer in this Agreement
or in any other certificate, document, writing or instrument
delivered by Buyer pursuant to this Agreement;
(iii) any liability arising out of or resulting from any act or omission
by Buyer or any of its directors, officers, employees or agents
prior to the Closing Date; or
(iv) any assumed liabilities pursuant to Section 2.1, except with respect
to any action arising out of or resulting from any act or omission
by Seller or any of its directors, officers, employees or agents
prior to the Closing Date.
11.2 Third-Party Claims.
(a) Promptly after receipt by an Indemnified Person of notice of the
assertion of a claim against it for which such Indemnified Person
may be entitled to indemnification pursuant to Section 11.1 (a
"Third-Party Claim"), such Indemnified Person shall give notice
to the Seller or Buyer, as applicable (hereinafter in this
Section 11.2, referred to as "Seller")of the assertion of such
Third-Party Claim, provided that the failure to notify the Seller
will not relieve the Seller of any liability that it may have to
any Indemnified Person, except to the extent that the Seller
demonstrates that the defense of such Third-Party Claim is
prejudiced by the Indemnified Person's failure to give such
notice.
(b) If an Indemnified Person gives notice to the Seller pursuant to
Section 11.2(a) of the assertion of a Third-Party Claim, the
Seller shall be entitled to participate in the defense of such
Third-Party Claim and, to the extent that it wishes (unless (i)
the Seller is also a person against whom the Third-Party Claim is
made and the Indemnified Person determines in good faith that
joint representation would be inappropriate or (ii) the Seller
fails to provide reasonable assurance to the Indemnified Person
of its financial capacity to defend such Third-Party Claim and
provide indemnification with respect to such Third-Party Claim),
to assume the defense of such Third-Party Claim with counsel
satisfactory to the Indemnified Person. After notice from the
Seller to the Indemnified Person of its election to assume the
defense of such Third-Party Claim, the Seller shall not, so long
as it diligently conducts such defense, be liable to the
Indemnified Person under this Article 11 for any fees of other
counsel or any other expenses with respect to the defense of such
Third-Party Claim, in each case subsequently incurred by the
Indemnified Person in connection with the defense of such
Third-Party Claim, other than reasonable costs of investigation
previously incurred. If the Seller assumes the defense of a
Third-Party Claim, (i) such assumption will conclusively
establish for purposes of this Agreement that the claims made in
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that Third-Party Claim are within the scope of and subject to
indemnification, and (ii) no compromise or settlement of such
Third-Party Claims may be effected by the Seller without the
Indemnified Person's consent unless (A) there is no finding or
admission of any violation of law or any violation of the rights
of any person; (B) the sole relief provided is monetary damages
that are paid in full by the Seller; and (C) the Indemnified
Person shall have no liability with respect to any compromise or
settlement of such Third-Party Claims effected without its
consent. If notice is given to Seller of the assertion of any
Third-Party Claim and the Seller does not, within ten (10) days
after the Indemnified Person's notice is given, give notice to
the Indemnified Person of its election to assume the defense of
such Third-Party Claim, the Seller shall be deemed to have
reserved its right to challenge whether the Third-Party Claim
falls within the scope of Section 11.1, above, but shall not
challenge the amount of the Damages resulting from the
determination made in such Third-Party Claim or any compromise or
settlement effected in good faith by the Indemnified Person.
(c) Notwithstanding the foregoing, if an Indemnified Person
determines in good faith that there is a reasonable probability
that a Third-Party Claim may adversely affect it other than as a
result of monetary damages for which it would be entitled to
indemnification under this Agreement, the Indemnified Person may,
by notice to the Seller, assume the exclusive right to defend,
compromise or settle such Third-Party Claim, but the Seller will
not be bound by any determination of any Third-Party Claim so
defended for the purposes of this Agreement or any compromise or
settlement effected without its consent (which may not be
unreasonably withheld).
SECTION 12
MISCELLANEOUS
12.1 Publicity. Any press releases and public communications concerning
this Agreement or the transactions contemplated hereby by either party, other
than notices required by federal or state regulations, including the federal
securities laws, shall require the prior approval of the other party, which
shall not be unreasonably withheld.
12.2 Post-Closing Cooperation. For no less than three (3) years following
the Closing Date, Seller shall cooperate and use its best efforts to have the
present and former officers, directors and employees of Seller cooperate with
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Buyer at Buyer's expense, in the execution and delivery of any further
instruments of transfer and furnishing of information, evidence, testimony, and
other assistance in connection with any actions, proceedings, arrangements or
disputes of any nature with respect to matters pertaining to the transaction
which occurred prior to the Closing Date.
12.3 Expenses. Each party shall pay its own expenses in connection with the
negotiation of and consummation of the transactions contemplated hereby.
12.4 Notices. All notices, requests, demands and other communications
required or permitted by any provision of this Agreement shall be in writing and
shall be deemed to have been duly given at the time either personally delivered
or sent by registered or certified mail, postage prepaid, as follows:
If to Buyer, to: Emily J. Girsch
Lincoln Savings Bank
508 Main Street
P.O. Box E
Reinbeck, IA 50669
With a copy to: Howard O. Hagen
Dickinson, Mackaman, Tyler & Hagen, P.C.
699 Walnut Street, 1600 Hub Tower,
Des Moines, IA 50309-3986
If to Seller, to: Mike Moderski
Vantus Bank
329 Pierce Street
PO Box 897
Sioux City, IA 51141
With a copy to: Luse Gorman Pomerenk & Schick, P.C.
5335 Wisconsin Avenue, N.W.
Suite 400
Washington, D.C. 20015
Attn: Robert B. Pomerenk, Esq.
12.5 Entire Agreement. This Agreement and the documents and instruments
referred to herein constitute the entire agreement between the parties hereto
and supersede all other understandings and letters of intent with respect to the
subject matter hereof.
12.6 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Iowa.
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12.7 Headings. The headings of the sections contained in this Agreement are
inserted for convenience only and shall not affect the meaning or interpretation
of this Agreement or any provisions hereof.
12.8 Severability. In the event any provision of this Agreement is rendered
invalid or unenforceable by federal or state legislation or regulation issued in
accordance with law or declared null and void by a court of competent
jurisdiction, the remainder of this Agreement shall remain in effect, unless
such removal has the effect of materially altering the obligations of either
party to the extent that in the judgment of the party affected it will (a) cause
serious financial hardship to such party, (b) cause such party to act in
violation its corporate articles or bylaws, or (c) substantially impair the
ability of such party to carry out its obligations under this Agreement or
achieve the purposes of this Agreement, then the party so affected shall have
the right to terminate this Agreement upon written notice to the other party.
12.9 Assignment. This Agreement and the rights and obligations of the
parties may not be assigned. Nothing expressed or referred to herein is intended
or shall be construed to give any person, other than the parties hereto, any
legal or equitable right, remedy, or claim under or in respect of this
Agreement, or any provision herein contained, it being the intention of the
parties hereto that this Agreement, the rights, obligations and responsibilities
hereunder, and all other conditions and provisions hereof are for the sole
benefit of the respective parties hereto.
12.10 Counterparts. This Agreement may be executed in multiple
counterparts, each of which shall be deemed to be an original and all of which
together shall constitute one and the same instrument.
12.11 Regulatory Applications. The parties shall use their best effort to
have prepared and filed within 30 calendar days of the date of this Agreement
all applications to the proper regulatory authorities which may be required for
the consummation of the transactions herein contemplated. Buyer agrees to
provide Seller a copy of all proposed final bank regulatory applications at
least five (5) business days prior the date it intends to file such
applications. If Seller does not provide written objection to the filing of such
applications within such five (5) day period, then Seller shall be deemed to
have accepted such applications. Seller may waive this five (5) day period in
writing.
12.12 Interpretation. In this Agreement, unless a clear contrary intention
appears:
(a) the singular number includes the plural number and vice versa;
(b) reference to any person includes such person's successors and
assigns but, if applicable, only if such successors and assigns
are not prohibited by this Agreement, and reference to a person
in a particular capacity excludes such person in any other
capacity or individually;
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(c) reference to any gender includes each other gender;
(d) reference to any agreement, document or instrument means such
agreement, document or instrument as amended or modified and in
effect from time to time in accordance with the terms thereof;
(e) reference to any legal requirement means such legal requirement
as amended, modified, codified, replaced or reenacted, in whole
or in part, and in effect from time to time, including rules and
regulations promulgated thereunder, and reference to any section
or other provision of any legal requirement means that provision
of such legal requirement from time to time in effect and
constituting the substantive amendment, modification,
codification, replacement or re-enactment of such section or
other provision;
(f) "hereunder," "hereof," "hereto," and words of similar import
shall be deemed references to this Agreement as a whole and not
to any particular Article, Section or other provision hereof;
(g) "including" (and with correlative meaning "include") means
including without limiting the generality of any description
preceding such term;
(h) "or" is used in the inclusive sense of "and/or";
(i) with respect to the determination of any period of time, "from"
means "from and including" and "to" means "to but excluding"; and
(j) references to documents, instruments or agreements shall be
deemed to refer as well to all addenda, exhibits, schedules or
amendments thereto.
12.13 Accounting Terms and Determinations. Unless otherwise specified
herein, all accounting terms used herein shall be interpreted and all accounting
determinations hereunder shall be made in accordance with GAAP.
12.14 Legal Representation of the Parties. This Agreement was negotiated by
the parties with the benefit of legal representation, and any rule of
construction or interpretation otherwise requiring this Agreement to be
construed or interpreted against any party shall not apply to any construction
or interpretation hereof.
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Executed by the parties hereto by their duly authorized officers on the day
and date first above written.
LINCOLN SAVINGS BANK VANTUS BANK
By: /s/ Emily J. Girsch By: /s/ Barry E. Backhaus
------------------------------- ------------------------------
Emily J. Girsch Barry E. Backhaus
First Vice President/Controller President and Chief Executive
Officer
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