Exhibit 28(h)
AGREEMENT
THIS AGREEMENT is made by and between REPUBLIC BANK, a
Michigan-chartered state bank, ("Purchaser"), and STANDARD FEDERAL BANK, a
federal savings bank ("Seller"). Purchaser desires to acquire from Seller, and
Seller is willing to sell to Purchaser, the following branch office buildings
(hereinafter "Premises") the deposit accounts and business conducted therefrom
and certain items of equipment and furniture located therein as well as the
deposit accounts located at the branch located at G-4442 Beecher Road, Flint
Township, Michigan.
The branch offices which are the subject of this Agreement
are as follows:
1. 220 E. Main Street, Flushing, Michigan
2. 1345 North Shiawassee Street, Owosso, Michigan
In consideration of the premises and the mutual covenants and undertakings set
forth hereinafter, the parties agree as follows:
I. PURCHASE AND SALE
1.1 Property to be Transferred. Subject to the terms and
conditions of this Agreement, effective at the close of business on the day of
closing ("Closing Date") (as defined hereafter), Seller shall sell, transfer,
convey, warrant and assign to
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Purchaser the following properties:
(a) The Premises more particularly described in Exhibit A
hereto together with all easements, improvements thereon and
all appurtenances thereto;
(b) All of Seller's right, title and interest in and to the
office equipment, furniture, office records, maintenance
contracts, if any, relating to the Premises and other items of
personal property , including all leased equipment, all of
which is described in Exhibit B attached hereto, all of which
is (and will be at the closing) located on the Premises.
Specifically excluded from the terms of this sale is the
property listed on Exhibit B-1.
(c) All cash and currency issued by the United States of
America held in the vaults at the Premises as of the Closing
Date.
(d) All of Seller's right, title and interest in and to all
deposits including but not limited to the savings accounts,
certificates of deposit, money market checking accounts
("MMCA's"), money market deposit accounts ("MMDA's"), checking
("NOW") accounts, all other forms of NOW or demand accounts,
including economy checking accounts ("ECA's"), regular business
checking accounts and low volume business checking accounts
("LBCA"), all individual retirement accounts ("IRA's") except
self-directed IRA's, Keogh plans, self
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employed Pension Plans ("SEPs"),and those IRA's which belong to
individuals aged 59 l/2 or greater as of the Closing Date and
which are associated with the Premises as well as the branch
office located at G-4442 Beecher Road, Flint Township,
Michigan, (hereinafter "Core Deposits"), all loans secured by
any of such Core Deposits being transferred to Purchaser in
whole or in part, all overdraft loans or lines of credit
associated with any Core Deposit accounts being transferred to
Purchaser, (collectively "Deposit-Related Loans) all land
contract accounts being serviced by Seller for which the Land
Contract payments are deposited into a deposit account being
transferred to Purchaser according to the books and records of
Seller at the effective date of transfer, all of Seller's
rights and interests under: (i) assignable service and
maintenance contracts in effect with respect to the Premises;
(ii) all assignable personal property leases; and, (iii) all
leases and subleases.
(e) A sum of money equal to: (i) the aggregate of the Core
Deposits assumed by Purchaser pursuant to Section 1.2, reduced
by the aggregate principal amount plus accrued but unpaid
interest, on all Deposit-Related Loans, (ii) the amount of
accrued but unpaid interest on such Core Deposits as of the
Closing Date; (iii) the amount of prepaid land contract
servicing fees, if
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applicable, calculated on a pro rata basis from the Closing
Date minus the amount of cash on hand and currency in the
vaults in the Premises.
All of the foregoing are sometimes hereafter referred to as the "Branch Office
Properties." Specifically excluded from the definition of Branch Office
Properties and from the terms of this sale are all individual retirement
accounts belonging to individuals aged 59 l/2 or greater as of the Closing
Date, all self-directed IRA's, all self employed pension plans ("SEPs), and
all Keogh accounts.
1.2 Purchase Price. In full consideration for the sale,
transfer and assignment of the Branch Office Properties, Purchaser agrees to
pay to Seller a sum of money (the "Purchase Price") equal to the Seller 's
book value as of the date of the Closing of the Premises and Furniture,
fixtures and equipment located therein plus a Deposit Premium as hereinafter
defined. The Deposit Premium shall equal 3.75 percent of the total Core
Deposits (excluding for this purpose only certificates of deposit issued and
outstanding as of the Closing Date in amounts of $100,000 or more) transferred
to Purchaser at the time of closing.
The Seller and the Purchaser agree that they will prepare and file their
federal and any state or local income tax returns based on the resulting
Purchase Price of the Branch Office Properties described in this Section 1.2.
The Seller and the Purchaser agree that they will prepare and file any and all
notices, and other filings required pursuant to Section 1060 of the Internal
Revenue Code of 1986, as amended, including IRS Form 8594, and that all
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such notices and filings will be prepared based on a mutually agreeable
allocation of the Purchase Price.
In addition, if applicable, Purchaser will pay any exit fees from the
Savings Association Insurance Fund ("SAIF") and any entrance fees to the Bank
Insurance Fund ("BIF") which are assessed or otherwise become payable as a
result of this Agreement.
Purchaser also agrees to assume the specified deposit liabilities of Seller
arising as of the Closing on account of savings, NOWs, MMCAs, MMDAs, ECAs,
RBCAs, LBCAs, certificate of deposits, and IRA's, Seller's obligations to pay
all accrued but unpaid interest thereon, and Seller's obligations under all
other agreements relating to such deposit accounts in each case as the same
shall exist at the Closing.
1.3 Prorated Items Price. All real and personal property taxes
and special assessments which have become a lien on the Premises or on any
personal property as of the Closing shall be paid by Seller. Current real and
personal property taxes, if any, shall be prorated and adjusted at the Closing
on a fiscal year basis. Water bills and other utility bills, if any, will be
prorated and adjusted as of the Closing. Seller shall be reimbursed by
Purchaser for the portion, prorated as of the Closing Date, of the deposit
insurance premiums paid by Seller to the FDIC with respect to the Core
Deposits for the second semi-annual assessment period in 1994 if the Closing
occurs in calendar year 1994 or for the first semi-annual (or first or second
quarterly
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assessment period, if applicable) assessment period if the Closing
occurs in calendar year 1995. For purposes of calculating this reimbursement,
an assessment rate shall be used which is the Seller's risk-based assessment
rate as established by the FDIC as applicable to the Savings Association
Insurance Fund ("SAIF").
II. CLOSING
2.1 Closing. The closing ("hereinafter Closing") shall take
place as of the close of business on either the first, second or third
Saturday following the expiration of thirty (30) days following receipt of the
last to be obtained of the regulatory approvals required under the terms of
this Agreement. The Closing shall take place at the offices of Seller at 2600
West Big Beaver Road, Troy, Michigan on the first, second or third Saturday
following receipt of all required regulatory approvals. The selection of the
precise Closing Date shall be a date mutually agreeable to Purchaser and
Seller (hereinafter "Closing Date").
2.2 Deliveries by Seller. Seller shall deliver to Purchaser the
following:
(a) At the Closing, Seller shall deliver to Purchaser:
(i) to the extent available to Seller, the information
described on Exhibit C hereto with respect to the Core Deposit
accounts transferred to Purchaser, which shall be complete and
accurate as of the close of business on
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the day preceding the Closing Date, and shall be certified as
such by the Chief Financial or Accounting Officer of Seller;
(ii) corporate warranty deeds in the form set forth in Exhibit
D, conveying marketable title to the Premises, subject only to
existing building and use restrictions and easements of record,
reasonably acceptable to the Purchaser and acceptable to the
title insurance company for purposes of securing title
insurance covering the Premises; "real estate transfer
valuation affidavits with respect to such Premises executed by
Seller in the form prescribed by the Register of Deeds in the
county in which each such Premises is located for determining
the amount of the transfer tax payable with respect to the
conveyance of such Premises to Purchaser hereunder (which
transfer tax shall be payable by Seller), and the affidavit
referred to in Section 3.12 hereof;" (iii) a bill of sale
conveying marketable title to the tangible personal property
described in Exhibit B, in the form as set forth in Exhibit E;
(iv) a general assignment of contract rights transferring to
Purchaser all of Seller's rights and privileges under the Core
Deposit account contracts, and Deposit-Related Loan agreements,
all leases, service contracts and other agreements to be
assumed by Purchaser, in the form as set forth in Exhibit F,
along with copies of all such contracts,
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agreements, and lists; (v) a certificate of Seller's Secretary
attesting to the approval of this Agreement by its Board of
Directors, with copies attached thereto of the resolutions
adopted by its Board of Directors; (vi) the title insurance
commitments required by Section 5.4, along with irrevocable
instructions to the title insurance company to issue and
deliver the title insurance policies to Purchaser in accordance
therewith; (vii) a list of all (A) assignable service and
maintenance contracts in effect with respect to the Premises
and all personal property located on the Premises, (B) all
assignable personal property leases pertaining to the Premises,
and (C) all assignable leases and subleases with respect to the
Premises, along with a copy of each such contract, lease and
sublease; and with a copy of each such contract, lease and
sublease; and (viii) such other documents as Purchaser may
reasonably request to more effectively transfer the Branch
Office Properties to Purchaser. Seller shall deliver possession
of the Branch Office Properties to Purchaser at the close of
business on the Closing Date. (vii) such other documents as
Purchaser may reasonably request to more effectively transfer
the Branch Office Properties to Purchaser. Seller shall deliver
possession of the Branch Office Properties to Purchaser at the
close of business on the Closing Date.
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(b) By ten o'clock in the morning, Detroit time, on the first
business day for both Seller and Purchaser following the
Closing Date, Seller shall deliver to Purchaser (i) a sum of
money, in immediately available funds, equal to the aggregate
balance of all Core Deposits liabilities (including accrued but
unpaid interest) transferred to Purchaser, reduced by the
aggregate principal and net accrued but unpaid interest amounts
on all specified Deposit-Related Loans, computed as of the
close of business on the day preceding the Closing Date
relating to the deposit account liabilities transferred to
Purchaser; (ii) a sum of money, in immediately available funds,
which represents interest on the sum described in Section
2.2(b)(i) at the Federal Funds Rate for "this week" as last
reported prior to the Closing Date by the Board of Governors of
the Federal Reserve System ("Federal Reserve Board") in the
Federal Reserve Statistical Release H-15, Selected Interest
Rates (the "Federal Funds Rate") for the period beginning with,
and including, the Closing Date to, but not including, the date
of payment hereunder; and (iii) a sum of money, in immediately
available funds, equal to the amount that Seller should have,
but did not, withhold during the year in which the Closing
occurs from interest paid or credited on the deposit account
liabilities to be
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assumed by Purchaser hereunder for remittance to the IRS
pursuant to any applicable laws or regulations relating to
backup withholding of interest, MINUS a sum of money equal to
the cash on hand and currency in the vault at the Premises.
2.3 Deliveries by Purchaser. Purchaser shall deliver to Seller
the following:
(a) At the Closing, Purchaser shall deliver to Seller:
(i) an instrument of assumption substantially in the form
attached hereto as Exhibit G, pursuant to which Purchaser
assumes and agrees to perform all of Seller's liabilities and
obligations relating to the Core Deposits and Deposit-Related
Loans transferred to Purchaser by Seller, and the servicing
agreements for land contracts being transferred to Purchaser;
and (ii) a certificate of Purchaser's Cashier or Secretary
attesting to the approval of this Agreement by the Purchaser's
Board of Directors, with copies attached thereto of the
resolutions adopted by Purchaser's Board of Directors.
(b) By ten o'clock in the morning, Detroit time, on the first
business day for both Seller and Purchaser following the
Closing Date, Purchaser shall deliver to Seller: (i) a sum of
money, in immediately available funds, equal to the total of
the consideration set
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forth in Section 1.2; and (ii) a sum of money, in immediately
available funds, which represents interest on the sum described
in Section 2.3(b)(i) at the Federal Funds Rate for the period
beginning with, and including, the Closing Date to, but not
including, the date of payment hereunder.
Seller shall deliver possession of the Branch Office Properties to Purchaser
at the close of business on the Closing Date.
2.4 Net Payment. Notwithstanding any other provisions of this
Section 2 to the contrary, Purchaser and Seller agree that at the time of
Closing, they will calculate the net payment due pursuant to Section 2.2 and
Section 2.3 and the party owing funds to the other will remit said net payment
in the manner set forth in Section 2 of this Agreement.
2.5 Post-Closing Settlement. On the first or second day
following the Closing Date, Seller shall deliver to Purchaser a complete and
accurate list of the information described on Exhibit C with respect to all
Core Deposits and Deposit-Related Loan balances included in the Branch Office
Properties as of the close of business on the Closing Date, certified by the
Chief Financial or Accounting Officer of Seller. Within 10 business days after
the Closing, at a time and place to be agreed upon, the parties shall make an
appropriate transfer of funds to reflect any change in total deposits and loan
balances from the close of
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business on the day preceding the Closing through the close of business on the
Closing Date, plus any amount required to reflect NOW, MMCA, MMDA, ECA,
certificate of deposit, and IRA transactions that settle after the Closing
Date as required by Section 8.3. If Seller's certified list of Core Deposit
Accounts shall be unacceptable to Purchaser, Deloitte & Touche shall conduct
an audit of such savings accounts within 30 days after the Closing and shall
certify the results thereof to the Purchaser and Seller and such certified
report shall be conclusive and binding on both parties hereto, and the cost of
such audit shall be borne equally by both parties.
III. REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to Purchaser as follows:
3.1 Organization, etc. Seller is a federal savings bank duly
organized, validly existing and in good standing under the federal Home
Owner's Loan Act of 1933, as amended, and has the full corporate power to
enter into this Agreement and to carry out its obligations hereunder (subject
to receipt of the approval of its Board of Directors and the Office of Thrift
Supervision, Department of Treasury (hereinafter "OTS") approval referred to
in Section 7.1). Seller further represents and warrants that upon approval by
its Board of Directors and the OTS, this Agreement will constitute Seller's
legal, valid and binding obligation.
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3.2 No Violation, etc. Neither the execution and delivery of
this Agreement nor the performance by Seller of its obligations hereunder
constitutes or will constitute a violation of or default under Seller's
charter or bylaws or any law, rule, ordinance, regulation, court order,
agreement, indenture or understanding to which Seller is subject or by which
Seller is bound.
3.3 Taxes. Seller has duly and timely filed all returns and
reports with federal, state and local taxing authorities relating to the
payment of interest, earnings or dividends on the Core Deposits to be
transferred to Purchaser hereunder, and has duly and timely paid all taxes,
levies and assessments on such accounts and any other of the Branch Office
Properties, including (but not limited to) any applicable intangibles taxes,
personal property taxes, real property taxes, sales and use taxes and excise
taxes. To the best of its knowledge and to the best of its ability, Seller has
obtained, to the extent required by law, all federal tax identification
numbers related to the Core Deposits.
3.4 Environmental. Seller has no actual knowledge of any
hazardous substances, hazardous waste, pollutant or contaminant, including,
but not limited to, asbestos, PCB's or urea formaldehyde, having been
generated, released into, stored or deposited over, upon or below the Premises
or into any water systems on or below the surface of the Premises by Seller,
or, to its actual knowledge, from any source whatsoever. As used in this
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Agreement, the terms "hazardous substances," "hazardous waste," "pollutant"
and "contaminant" mean any substance, waste, pollutant or contaminant included
within such terms under any applicable Federal, or state statute or
regulation. No demand, claim, notice, suit in equity, or administrative
action, by any governmental authority, arising under, relating to or in
connection with any environmental laws is pending or threatened against Seller
in respect of the Premises or any past or present operation of Seller therein.
3.5 Real Property. The improvements and appurte-nances to the
Premises and their present use by Seller do not, and the use of the same by
Purchaser (including specifically all drive-up teller windows), to the best of
Seller's knowledge, will not violate any provision of any presently applicable
zoning ordinance, fire regulation, or restrictive covenant; except that Seller
makes no representations or warranties with respect to compliance of the
Premises with any state or federal law, rule, or regulation pertaining to
accessibility of the Premises to individuals with handicaps or disabilities,
including, but not limited to, the Americans with Disabilities Act and the
regulations adopted in connection therewith. Seller owns the Premises in fee
simple free and clear from all liens and encumbrances whatsoever, subject only
to current taxes which are a lien thereon but not yet due and payable. Upon
delivery by Seller of the corporate warranty deeds at the Closing, Purchaser
will acquire good, valid and marketable
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fee simple title to the Premises. No party is in possession of all or any
portion of the Premises, whether as lessee or tenant at sufferance, other than
Seller.
3.6 Personal Property. All of the tangible personal property
described on Exhibit B under the category "Assets Owned" is validity and
indefeasibly owned by Seller free and clear of all liens and encumbrances. Any
personal property located on the Premises and listed on Exhibit B-1 in which
Seller has a leasehold interest may be removed from the Premises by the
Closing Date without breach or violation of any applicable lease agreement or
any material damage or alterations to the Premises.
3.7 Litigation; Compliance with Law. There are no claims,
demands or actions pending or, to Seller's knowledge, threatened against
Seller by any customer, depositor, supplier or employee of Seller on account
of any business or related activities conducted by Seller or its employees or
agents at the Premises, and Seller does not know of any basis in fact for any
such claim, demand or action.
3.8 Outstanding Accounts and Contracts. As of September 2,
1994, the aggregate of all Core Deposits maintained at the Branch Office
Properties and the branch located at G-4442 Beecher Road, Flint Township,
Michigan, was approximately $20.1 Million. As soon as reasonably feasible
after execution of this
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Agreement, Seller shall, to the extent it has such information available,
furnish to Purchaser: (a) a complete and accurate list of all types of
accounts offered at its office located on the Premises and all outstanding
loans secured by any such accounts; (b) copies of all forms of deposit account
contracts, passbooks, certificates of deposit and other evidences of ownership
relating to such accounts; (c) copies of all powers of attorney, IRS W-9
forms, joint control agreements and other agreements, orders or instructions
relating to the rights of existing depositors at such branch office; and (d)
copies of all direct deposit agreements with the Social Security
Administration or any other person or party relating to the accounts at such
branch offices. All such lists and copies shall be true, accurate and complete
in all material respects.
3.9 Disclosure. To the best of its knowledge, Seller has
disclosed to Purchaser all facts material to the Branch Office Properties. No
representation or warranty by Seller contained in this Agreement and no
statement contained in any certificate, schedule, list or other writing
furnished to Purchaser pursuant hereto, contains any untrue statement of a
material fact or omits to state a material fact necessary in order to make the
statements contained herein or therein not misleading.
3.10 No Adverse Change in Financial Condition. Since October 1,
1994, there has been no material adverse change in the
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financial condition, assets, liabilities or business of Seller. Since such
date no event has occurred or, to Seller's knowledge, is likely to occur that
would have a material adverse effect on the financial condition, assets,
liabilities or business of Seller.
3.11 Contracts. There are no service or maintenance contracts
with respect to the Premises or any personal property located thereon, any
personal property leases pertaining to the Premises, or any leases or
subleases relating to all or any portion of the Premises, other than as
specifically listed on Exhibit I attached hereto.
3.12 FIRPTA. Seller is not a "foreign person" as defined in
Section 1445(f)(3) of the Internal Revenue Code of 1986 and regulations
promulgated thereunder, and Seller shall furnish to the Purchaser, at Closing,
an affidavit to this effect.
IV. REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser represents and warrants to Seller as follows:
4.1 Organization, etc. Purchaser is a Michigan-chartered state
bank, duly organized, validly existing and in good standing under the laws of
the State of Michigan, and has the full corporate power to enter into this
Agreement and to carry out its obligations hereunder (subject to receipt of
the approval of its Board of Directors and the Financial Institutions Bureau -
State of
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Michigan ("FIB") the Federal Deposit Insurance Corporation ("FDIC"), and the
Federal Reserve Board ("FRB")). Purchaser further represents and warrants that
upon approval by its Board of Directors, the FIB, the FRB and the FDIC, this
Agreement will constitute Purchaser's legal, valid and binding obligation.
4.2 No Violation, etc. Neither the execution and delivery of
this Agreement nor the performance by Purchaser of its obligations hereunder
constitutes or will constitute a violation of or default under Purchaser's
charter or bylaws or any law, rule, ordinance, regulation, court order,
agreement, indenture or understanding to which Purchaser is subject or by
which Purchaser is bound.
V. CONDITIONS TO OBLIGATIONS OF PURCHASER
Each and every obligation of Purchaser hereunder is subject to
the satisfaction of the following conditions, or their waiver in writing by
Purchaser, at or prior to the Closing Date:
5.1 Truth and Accuracy. The representations and warranties of
Seller contained in this Agreement shall be true and correct as of the Closing
Date as though made on such date.
5.2 Director Approval. This Agreement shall have been approved
by the Boards of Directors of both Seller and
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Purchaser within 45 days after execution hereof, and such approvals shall not
have been rescinded or modified.
5.3 Approval by Regulators. The written approvals of the OTS,
the FIB, the FRB and FDIC to the transactions contemplated hereby shall have
been received and all requisite waiting periods shall have expired.
5.4 Title Commitment. Seller shall have furnished to Purchaser,
at Seller's expense, a commitment for title insurance, issued by a title
insurance company reasonably acceptable to Purchaser and bearing a date
subsequent to the date of this Agreement, in which said title insurance
company agrees to issue and deliver, without cost to Purchaser, a policy of
title insurance with standard exceptions insuring Purchaser for the amount of
the Purchase Price of the Premises against any loss or damage incurred by
Purchaser's failure to acquire fee simple marketable title to the Premises
from Seller, subject to building and use restrictions and easements of record
reasonably acceptable to Purchaser. Purchaser shall have a period of ten (10)
days following delivery to it of the commitment issued by the title insurance
company under this paragraph 5.5 within which to notify Seller of any
exceptions in the title insurance commitment which do not meet the provisions
of this paragraph 5.5. Any portion of the title insurance commitment as to
which notice is not given shall be deemed to be satisfactory to Purchaser. In
the event such notification is given
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to Seller, Seller shall have sixty (60) days from the date of Purchaser's
notice of defects in which to cure such defects.
5.5 No Adverse Change. There shall not have been any material
damage to the Premises and personal property set forth in Exhibit B from fire,
lightning, smoke, storms, explosion, vandalism or similar events nor shall
there have been any material adverse change in the business of Seller as
conducted at its branch office located on the Premises, including any material
adverse change in the offered terms governing any Core Deposit accounts or
Deposit Related Loans that is not in the ordinary course of business
consistent with past practices.
5.6 Environmental. Acceptance by Purchaser, in its reasonable
discretion, of an environmental assessment performed by an environmental
consultant selected by Purchaser, at Purchaser's expense, which states to
Purchaser's sole satisfaction that no present indication exists that hazardous
or toxic materials, wastes or substances have been used, generated, stored,
released, discharged, disposed of or are present on, under or about the
Premises or on any adjoining land and that the Premises are free from and
contain no hazardous or toxic substances, asbestos, wastes, chemicals or
liquids as such terms are described or defined in the following statues and
rules:
Federal Clean Air Act
Federal Clean Water Act
Federal Resource Conservation and Recovery Act
Comprehensive Environmental Response, Compensation
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and Liability Act
Copies of all reports received by Purchaser pertaining to the Premises shall
be provided to Seller upon receipt by Purchaser. Purchaser shall have a period
of thirty (30) days from the date that this Agreement is last signed by
Purchaser or Seller to satisfy, waive, remove this condition or notify Seller
in writing as to any objections it has regarding the environmental condition
of the Premises. Failure of Purchaser to give Seller the notice required
herein shall be deemed a waiver of this condition by Purchaser.
5.7 Other. Purchaser shall have received from Seller all lists,
schedules and copies referred to in Section 3.8 not previously delivered by
Seller prior to the execution of this Agreement, and such certificates of
Seller's officers as Purchaser reasonably deems necessary to evidence the
continued truth and accuracy of Seller's representations and warranties as of
the Closing Date and Seller's compliance with all other agreements and
covenants by Seller contained herein.
5.8 Seller Performance. Seller shall have performed all of its
obligations hereunder, except those obligations which by their terms are to be
performed at or after the Closing, and as to such obligations Seller shall be
ready, willing and able to perform the same.
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5.9 No Litigation. No action, suit or proceeding against Seller
or Purchaser prevents, or is pending and seeks to prevent, the consummation of
the transactions contemplated hereby.
VI. CONDITIONS TO OBLIGATIONS OF SELLER
Each and every obligation of Seller hereunder is subject to the
satisfaction of the following conditions, or their waiver in writing by
Seller, at or prior to the Closing Date:
6.1 Approvals by Directors. This Agreement shall have been duly
approved by the Boards of Directors of both Purchaser and Seller within 45
days after execution hereof and such approvals shall not have been rescinded
or modified.
6.2 Approval by OTS. The written approval of the OTS to the
transaction contemplated hereby shall have been received and no conditions or
requirements to such approval shall have been imposed by the OTS which are not
satisfactory to Seller and Purchaser.
6.3 Other. Seller shall have been provided with a written
statement from Purchaser indicating that each of the conditions set forth in
Section 5 hereof have been satisfied or waived and that Purchaser accepts the
Premises and the Branch
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Office Properties "as is" in their present condition. Seller in its sole
discretion may waive this condition in part or in total.
6.4 Purchaser Performance. Purchaser shall have performed all
of its obligations hereunder, except those obligations which by their terms
are to be performed at or after the Closing, and as to such obligations
Purchaser shall be ready, willing and able to perform the same.
6.5 No Litigation. No action, suit or proceeding against Seller
or Purchaser prevents, or is pending and seeks to prevent, the consummation of
the transactions contemplated hereby.
VII. CONDUCT PRIOR TO CLOSING
During the period of time from the date of execution of this
Agreement to the date of Closing the parties agree to take the following
action:
7.1 OTS Application. Promptly after approval of this Agreement
by the Boards of Directors of both Purchaser and Seller, Seller shall commence
preparation of an application to the OTS for permission to sell the branch
offices at the Premises, and Purchaser shall join in such application to
secure approval of the OTS for the sale of the Branch Office Properties to
Purchaser. Purchaser shall furnish to Seller all necessary financial
information, certificates and other documents as shall be necessary
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or desirable in connection with the filing of such application, including a
certified copy of the resolutions adopted by Purchaser's Board of Directors
approving this Agreement. In addition, Purchaser shall, within promptly after
approval of this Agreement by the Boards of Directors of both Purchaser and
Seller, submit an application to the FIB, the FRB, the FDIC and any other
required regulatory agency for permission to establish branch offices at the
Premises or any other Branch Office Properties and for permission to continue
coverage for the Core Deposit under the Savings Association Insurance Fund. To
the extent necessary, Seller shall join in such application and furnish to
Purchaser all necessary financial information, certificates and other
documents as shall be necessary or desirable in connection with the filing of
such application(s).
7.2 No Change in Operations. Seller shall carry on its savings
bank business at the Branch Office Properties in substantially the same manner
as conducted on the date of this Agreement and shall refrain from introducing
any new or unusual methods of operation or accounting. Seller shall not
purchase or commit to purchase any additional furnishings or equipment to be
placed on the Premises without first obtaining Purchaser's written approval
for such action. Additionally, Seller shall not sell any Branch Office
Property, enter into any material contracts concerning the Premises or pledge
or encumber the Premises or Branch Office Property without first obtaining
Purchaser's written
24
approval. Seller shall pay or credit all regular payments relating to deposit
accounts maintained at such branch in accordance with its customary practices.
During the pendency of this Agreement, Seller shall grant no pay raises to
employees working at the Premises if said raises would be outside the ordinary
course of Seller's business, unless and until said raises have been approved
in writing by Purchaser.
7.3 Maintenance of Properties. Seller shall maintain the
Premises and all tangible personal property located thereon in good working
order and shall keep the same fully insured under existing policies of
insurance.
7.4 No Breach. Seller shall refrain from doing any act or
omitting to do any act which will cause a material breach of any contract or
commitment relating to its business conducted at such branch offices or the
properties included in the Branch Office Properties.
7.5 Access to Records and Premises. Within 15 days after the
date of this Agreement, Seller shall, to the extent it has such information
available, provide Purchaser with the information specified on Exhibit C
attached hereto, and Seller agrees to provide updates of such information as
required by Section 2.2. Following execution of this Agreement, Seller agrees
to provide Purchaser, or its representatives, with access during
25
normal business hours to the Premises to permit Purchaser to install telephone
data communication lines and to examine the Premises in order to facilitate
transference of the business conducted thereon, provided that Purchaser shall
not disrupt Seller's operations in carrying out such activities. Seller also
agrees to make available for inspection by Purchaser the books and records
pertaining to the business of Seller as conducted at the branch offices
located on the Premises, and Seller agrees not to destroy any such books and
records without giving Purchaser reasonable prior notice of its intent to do
so and an opportunity to review the same and make copies thereof. Seller
further agrees that in the event Purchaser finds any deficiencies in Seller's
books and records pertaining to the Premises, Seller shall, upon request by
Purchaser, use its best efforts to cure such deficiencies as soon as
reasonably practicable after receipt of such request from Purchaser. In the
event the sale and transfer as contemplated by this Agreement is not
consummated for any reason within the time periods set forth in this
Agreement, then Purchaser shall, within three (3) days of receipt of demand
from Seller, return to Seller all originals and copies of account and customer
information, books, records, computer tapes and data provided to Purchaser
pursuant to this Agreement and further agrees to remove all personal property
and communications lines installed by Purchaser upon receipt of Seller's
demand.
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7.6 No Announcements. Purchaser and Seller shall each refrain
from making any public announcement or any announcement to Seller's customers
(including depositors) of the transactions contemplated by this Agreement
without the prior written approval thereof of the other party unless such an
announcement is required by the Securities and Exchange Commission or some
other regulatory body governing the affairs of either the Purchaser or Seller.
Additionally, the parties agree to jointly prepare and issue a press release
announcing the terms of this transaction on a mutually agreeable date.
7.7 Notice to Depositors. In the event Purchaser is required by
its regulators to prepare a notice to the depositors whose accounts it is
acquiring, either before or after Closing, Purchaser agrees that it will
prepare said notice, at its sole cost and expense, in accordance with the
instructions received from its regulators. Seller will prepare and file any
branch closing notices required by any rules and regulations applicable to
this transaction.
7.8 No Other Agreements. Seller agrees that so long as this
Agreement is pending, it will not solicit any offers or enter into any
agreements or understandings with any other party relating to the disposition
of the Branch Office Properties or Premises without the express written
consent of Purchaser.
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7.9 Best Efforts. Each party to this Agreement shall use its
best efforts to render its representations and warranties hereunder true and
correct, to perform its covenants and obligations hereunder, to obtain as soon
as possible all government and other third-party consents required to be
obtained by it, and to take such action as may be necessary to close the
transactions contemplated herein as soon as practicable, but in any event on
or before March 31, 1995.
7.10 No Shop. Seller agrees that so long as this Agreement is
pending, it will not solicit any offers or enter into any agreements or
understanding with any other party relating to the disposition of the premises
without the express written consent of Purchaser.
VIII. ACTION SUBSEQUENT TO CLOSING
8.1 Assistance After Closing. With respect to alarm &
surveillance equipment not purchased by Purchaser hereunder, Seller agrees to
keep in service and make available to Purchaser any such equipment at the
Premises for a period of up to 15 business days after the Closing, and
Purchaser agrees to reimburse Seller for a pro rata portion of the costs for
such systems for the time of actual use thereof by Purchaser.
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8.2 Removal of Property. If Purchaser shall request, Seller
agrees to remove from the Premises any tangible personal property located
thereon not sold to Purchaser as a part of the Branch Office Properties prior
to the Tuesday following Closing.
8.3 Post-Closing Settlement. For a period of ninety (90) days
following Closing, Seller shall consult with Purchaser upon presentment of any
checks, drafts, incoming ACH debits and credits, Visa debits and adjustments,
ATM transactions on sold accounts (only for ten (10) days) and other
negotiable instruments drawn on any of the deposit accounts transferred to
Purchaser hereunder, and if assured by Purchaser that sufficient funds are
available to honor such instruments, Seller shall pay such instruments. Upon
presentment of such instruments following such consultation with and assurance
by Purchaser and after their payment by Seller, Purchaser agrees to purchase
such checks and instruments from Seller for the face amount thereof. If any
customer of Seller whose deposit account is transferred to Purchaser hereunder
has, prior to the effective time of the Closing, presented or deposited a
negotiable instrument drawn on another financial institution for collection
and payment, and such instrument subsequently is dishonored by the drawee
institution, Purchaser agrees to purchase such negotiable instrument from
Seller for the face amount thereof provided that at the time of transfer of
such deposit account to Purchaser there existed a proper hold on
29
sufficient credit in the account against which to charge such dishonored
instrument.
8.4 Indemnification.
(a) Seller shall indemnify, defend and hold Purchaser, its directors,
officers, employees and agents harmless from and against all demands, damages,
liabilities, costs and expenses (including, without limitation, interest,
penalties and attorney's fees) asserted against, imposed on or incurred by
such indemnified party by reason of or resulting from (a) any breach of the
representations, warranties or covenants of Seller herein; and (b) any other
liability or obligation of or claim against Seller or Purchaser arising out of
any occurrence, event or state of facts relating to any of the properties
transferred to Purchaser hereunder existing or having taken place prior to the
Closing, including, without limitation, any liability or obligation for any
tax, penalty or interest arising from or with respect to any of the Branch
Office Properties, or operations of the business conducted therewith, which is
incurred or is attributable to any period on or prior to the Closing Date,
other than those liabilities, obligations and claims specifically assumed by
Purchaser hereunder. Purchaser will give Seller notice of any such claims, and
Seller will undertake the defense thereof at its own cost by representatives
of its own choosing. Further, Purchaser shall have the option of participating
in said defense at its own expense.
30
(b) Purchaser shall indemnify, defend and hold Seller, its directors,
officers, employees and agents harmless from and against all demands, damages,
liabilities, costs and expenses (including, without limitation, interest,
penalties and attorney's fees) asserted against, imposed on or incurred by
such indemnified party by reason of or resulting from any breach of the
representations, warranties or covenants of Purchaser herein. Seller will give
Purchaser notice of any such claims, and Purchaser will undertake the defense
thereof at its own cost by representatives of its own choosing reasonably
acceptable to Seller. Further, Seller shall have the option of participating
in said defense at its own expense.
8.5 Tax Reports. Purchaser agrees to file with appropriate
federal, state, and local taxing authorities and to send to all Core Deposit
account customers and Deposit Related Loan customers all required reports
pertaining to the interest paid to or by them with respect to their accounts
during the entire calendar year in which the Closing occurs. Seller agrees to
timely provide to Purchaser the necessary information for each such account
through the Closing Date to enable Purchaser to do this combined reporting for
the entire calendar year.
8.6 Account Transfers. Following the Closing, Purchaser agrees,
for all Core Deposit accounts acquired hereunder, to honor all existing
arrangements with the Automated Clearing House
31
Association ("ACHA") for incoming transactions to and from accounts with other
financial institutions and third parties (including Seller) and to honor any
arrangements for transfers by Seller from one account of a depositor to
another account at the subject branch offices, but Purchaser shall not be
required to honor any other type of account transfer arrangement offered by
Seller to the depositors whose accounts are transferred hereunder.
8.7 Further Assurances. Each party hereto agrees to execute and
deliver such other documents as the other party hereto may reasonably deem
necessary or desirable to effectuate the transactions contemplated by this
Agreement.
IX. MISCELLANEOUS
9.1 Survival of Representations. The representations and
warranties of Seller and Purchaser herein shall survive the Closing without
limit for a period of six years. All statements contained herein or in any
certificate, schedule, list or other document delivered pursuant hereto shall
be deemed representations and warranties within the meaning of this Section.
9.2 No Commissions. Each of the parties hereto represents and
warrants to the other that there are no claims for brokerage commissions or
finder's fees in connection with the transactions contemplated by this
Agreement. Each party will
32
indemnify the other and hold it harmless from and against any and all claims
or liabilities for brokerage commissions or finder's fees incurred by reason
of any action taken by it.
9.3 Termination of Agreement. Notwithstanding any other
provision contained herein, this Agreement may be terminated by either party
upon written notice to the other and without liability for breach hereof by
the terminating party if the approval of the OTS, the FRB, the FIB or the FDIC
required for the consummation of the transactions contemplated hereby shall
not have been received by March 31, 1995. Additionally, this Agreement may be
terminated by the non-breaching party in the case of a material breach of the
representations and warranties set forth herein or in case the conditions
precedent to terminating either party's obligation to proceed have not been
satisfied or waived.
9.4 Expenses. Seller agrees that all fees and expenses incurred
by it in connection with this Agreement shall be borne by it, and Purchaser
agrees that all fees and expenses incurred by it in connection with this
Agreement shall be borne by it.
9.5 Parties in Interest. This Agreement and the schedules and
other writings referred to herein or delivered pursuant hereto which form a
part hereof contain the entire understanding of the parties with respect to
its subject matter.
33
There are no restrictions, promises, warranties, covenants or undertakings
other than expressly set forth herein or therein. This Agreement supersedes
all prior agreements and understandings between the parties with respect to
its subject matter. This Agreement may be amended only by a written instrument
duly executed by the parties and may not be assigned by Purchaser without the
express written consent of the Seller. Any condition to a party's obligations
hereunder may be waived in writing by such party.
9.6 Covenant Not to Compete. Seller hereby further covenants
and agrees that for a period of two years commencing on the Closing Date none
of Seller, Seller's affiliates, and their respective officers, directors,
employees and other agents will establish a deposit gathering branch within
two (2) miles of the Branch Offices or otherwise, directly and knowingly,
solicit deposits from any of the owners of any of the Core Deposits.
Notwithstanding anything to the contrary express or implied herein, this
Covenant Not to Compete shall neither prohibit nor apply to (i) any automated
teller machines owned or operated by Seller now located in the Territory and
any automated teller machines owned and operated by third parties which
participate in an ATM network in which Seller also participates, (ii) any
deposit gathering branch or loan solicitation offices of third parties now or
hereafter established in the Territory that are subsequently acquired by
Seller or its affiliates as a result of a merger or acquisition involving any
such third party or Seller or its
34
affiliates, (iii) general advertisements or solicitations, (iv) deposit
accounts associated with any extensions of credit to a depositor which were
not solicited in contravention of this Section 9.6 or (v) branches in
existence at the date of closing and owned by a third party which acquires
Seller through a merger, acquisition or otherwise.
9.7 Employees. Purchaser shall have no obligation to employ any
person now employed by Seller. Purchaser will review the qualifications and
may interview some or all of Seller's employees working at the Premises, and
may offer employment positions on an at will basis to all, some or none of the
employees now employed by Seller at salary and wage levels and benefits
determined solely by Purchaser. Each individual employee may accept or reject
Purchaser's employment offer. Purchaser assumes no liability for any accrued
or vested employee or severance or termination benefits of any of Seller's
employees.
9.8 Headings. The section and paragraph headings contained in
this Agreement are for reference purposes only and shall not affect in any way
the meaning or interpretation of this Agreement.
9.9 Notices. All notices, claims, certificates, requests,
demands and other communications hereunder shall be in writing and will be
deemed to have been duly given if delivered or mailed (registered or certified
mail, postage prepaid, return receipt requested or Federal Express or other
overnight delivery
35
service which guarantees next day delivery and requires acknowledgement of
receipt):
If to Seller: Jack D. Brown, Senior Vice President
Standard Federal Bank
2600 West Big Beaver Road
Troy, Michigan 48084
With a Copy to: David P. Trahan, Esq.
Standard Federal Bank
2600 West Big Beaver Road
Troy, Michigan 48084
If to Purchaser: Dana M. Cluckey
Executive Vice President
Republic Bancorp, Inc.
1070 East Main Street
Owosso, Michigan 48867
With a copy to: George E. Parker III
Miller, Canfield, Paddock & Stone
150 W. Jefferson, Suite 250
Detroit, Michigan 48226-4415
9.10 Confidentiality. For purposes of this Agreement any and
all financial information, schedules, agreements, books, records, accounts,
reports, customer lists, customer information, electronic data bases, loan
files, instruments, papers, documents, or other information relating to the
Branch Office Properties shall be deemed to be "Confidential Information."
(a) While this Agreement is in effect and at all times
thereafter unless and until this transaction is
consummated, Purchaser shall treat as strictly
confidential, and shall not divulge to any other person
(natural or corporate) the Confidential Information which
it may come to know as a direct result of a
36
disclosure by Seller or which may come into its possession
directly as a result of and during the course of
investigation pursuant to Section 7.5. Purchaser shall be
permitted to disclose such Confidential Information to its
directors, officers, employees, attorneys, accountants,
and financial advisers who have a need for such
information in connection with this transaction. (b) The
provisions of this Section shall not preclude Purchaser
from using or disclosing at any time Confidential
Information which is (i) readily ascertainable from public
information or trade sources; (ii) reasonably required to
be included in a report filed with any governmental
agency; (iii) reasonably required to be included in any
filing or application required by any regulatory agency,
(iv) received from a third party not under any obligation
to keep such information confidential; (v) required by law
or regulation to be disclosed; (vi) known by it before the
commencement of discussions among the parties to this
Agreement; or (vii) subsequently developed by it
independent of its disclosure pursuant to or in connection
with this Agreement.
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9.11 Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original but all of which
shall constitute one and the same Agreement.
9.12 Governing Law. Except insofar as this Agreement is sub
ject to the Federal Home Owners' Loan Act of 1933, as amended, and federal
banking law, this Agr eement shall be governed by and construed in accordance
with the laws of the State of Michigan.
IN WITNESS WHEREOF the parties have caused this Agreement
to be executed on their behalf by duly authorized officers on the dates
indicated below.
REPUBLIC BANK
By: /s/ Barry Eckhold
-----------------------------------
Barry Eckhold
Its: Chairman and President
----------------------------------
Date: 11/14/94
STANDARD FEDERAL BANK
By: /s/ Jack D. Brown
-----------------------------------
Jack D. Brown, Senior Vice President
Date: 11-30-94
38
STATE OF MICHIGAN )
) SS
COUNTY OF SHIAWASSEE )
On this 14th day of November, 1994, before me, a Notary Public,
appeared Barry Eckhold, Chairman & President of Republic Bank, a
Michigan-chartered state bank, and who executed the foregoing Agreement on
behalf of said Bank.
/s/ Pamela May Beckman
-----------------------------
Notary Public
Pamela May Beckman
Notary Public, Shiawassee County
My Commission Expires May 1, 1995
STATE OF MICHIGAN )
) SS
COUNTY OF OAKLAND )
On this 30th day of November, 1994, before me, a Notary Public,
appeared Jack D. Brown, Sr. Vice President of Standard Federal Bank, a federal
savings bank, and who executed the foregoing Agreement on behalf of said Bank.
/s/ Paulette L. Langford
------------------------------
Notary Public
Paulette L. Langford
Macomb County (Acting in Oakland), MI
My Commission Expires: 3-4-95
39