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EXHIBIT 10.8
AGREEMENT AND PLAN OF MERGER
BY AND AMONG
UNIONBANCORP, INC.,
CBI ACQUISITION CORPORATION
AND
COUNTRY BANCSHARES, INC.
MARCH 21, 1996
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LIST OF EXHIBITS
Exhibit A Form of Opinion of Counsel to Union
Exhibit B Form of Opinion of Counsel to CBI
Exhibit C Form of Non-Competition Agreement
Exhibit D Form of Indemnity Agreement
Exhibit E Form of Office Lease
Exhibit F Form of Paying Agent Agreement
Exhibit G Form of Voting Agreement
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LIST OF SCHEDULES
Schedule 4.1 CBI Organization
Schedule 4.2 CBI Capitalization
Schedule 4.3 Omni Bank Organization
Schedule 4.6 CBI Litigation and Regulatory Matters
Schedule 4.7 CBI Insurance
Schedule 4.9 CBI Financial Statements and Reports
Schedule 4.10 CBI Loan Loss Reserve
Schedule 4.12 CBI Properties, Contracts, Employee
Benefit Plans and Other Agreements
Schedule 4.14 Effect of Agreement
Schedule 4.15 CBI Articles of Incorporation, Charters
and Bylaws
Schedule 4.17 CBI Interim Events
Schedule 4.18 CBI Taxes
Schedule 4.19 CBI Title to Properties
Schedule 4.21 Compliance With ERISA by CBI
Schedule 4.22 Compliance With Environmental Laws by CBI
Schedule 7.4 Purchase of CBI Assets
Schedule 8.15 Sale of Certain Assets and Loans
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AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (this "Agreement") is entered into
this 21st day of March, 1996, by and among UNIONBANCORP, INC., a Delaware
corporation ("Union"), COUNTRY BANCSHARES, INC., an Illinois corporation
("CBI") and CBI ACQUISITION CORPORATION ("Acquisition Corp"), an Illinois
corporation and a wholly-owned subsidiary of Union.
RECITALS
A. The parties hereto desire to effect a reorganization whereby
Union desires to acquire control of CBI through the merger (the "Merger") of
Acquisition Corp with and into CBI with CBI being the surviving corporation
(the "Surviving Corporation").
B. Pursuant to the terms of this Agreement and at the time of the
closing of the Merger (the "Closing"), each outstanding share of the common
stock of CBI, $1.00 par value per share ("CBI Common Stock"), and each
outstanding share of Series 1 and Series 2 of the Class A preferred stock of
CBI, $295.00 par value per share ("CBI Preferred Stock," and collectively
referred to with the CBI Common Stock as "CBI Stock"), shall be converted into
the right to receive cash in the amount set forth herein and all of the
outstanding shares of common stock, no par value per share, of Acquisition Corp
shall be converted into and shall thereafter represent all of the issued and
outstanding stock of the Surviving Corporation.
AGREEMENTS
In consideration of the mutual covenants, representations and
warranties contained herein, the parties agree as follows:
ARTICLE 1
DEFINITIONS
SECTION 1.1 DEFINITIONS. The following terms, when used herein and
unless the context clearly requires otherwise, shall have the following
meanings (such meanings to be equally applicable to both the singular and
plural forms of the terms defined):
"Acquisition Corp" shall mean CBI Acquisition Corporation, an Illinois
corporation.
"Affiliate" shall have the meaning provided in Rule 144 promulgated
under the Securities Act of 1933, as amended.
"Aggregate Amount" shall have the meaning provided in Section 3.2.
"Agreement" shall mean this Agreement and Plan of Merger.
"Articles of Merger" shall mean the articles of merger filed by CBI and
Acquisition Corp with the Secretary of State of the State of Illinois pursuant
to Section 2.8.
"BHCA" shall mean the federal Bank Holding Company Act of 1956, as
amended.
"BIF" shall mean the Bank Insurance Fund.
"Business Day" shall mean any day when UnionBank is open for the
transaction of all banking business.
"Call Report" shall mean the Report of Condition and Income of a state
or national bank.
"Cash Price Per Common Share" shall have the meaning set forth in
Section 3.2.
"Cash Price Per Preferred Share" shall have the meaning set forth in
Section 3.2.
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"CBI" shall mean Country Bancshares, Inc., an Illinois corporation.
"CBI Book of Schedules" shall mean the Schedules and agreements and
other documentation described and referred to in Section 4 of this Agreement
with respect to CBI.
"CBI Closing Obligations" shall have the meaning provided in Section
6.9.
"CBI Common Stock" shall mean the outstanding common stock of CBI,
$1.00 par value per share.
"CBI Financial Statements" shall mean the financial statements and
reports of CBI and Omni Bank described in Section 4.9.
"CBI Preferred Stock" shall mean the outstanding Series 1 and Series 2
Class A preferred stock of CBI, $295.00 par value per share.
"CBI Stock" shall collectively mean the CBI Common Stock and the CBI
Preferred Stock.
"Certificates" shall mean one or more stock certificates representing
an outstanding share or outstanding shares of CBI Stock.
"Closing" shall mean the closing of the Merger of Acquisition Corp with
and into CBI.
"Closing Date" shall mean the day the Closing occurs.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and the rules and regulations promulgated thereunder.
"Commissioner" shall mean the Commissioner of Banks and Trust Companies
of the State of Illinois.
"Dissenting Shares" shall mean the shares of CBI Stock owned by
dissenting shareholders of CBI who have properly exercised their appraisal
rights pursuant to Section 11.70 of the Illinois BCA.
"Effective Time" shall have the meaning provided in Section 2.8.
"Employee Benefit Plans" shall have the meaning provided in Section
4.12.
"Environmental Laws" shall mean those statutes, regulations, rules,
ordinances, orders, restrictions and requirements relating to the protection of
the environment described in Section 4.23.
"Environmental Report" shall have the meaning set forth in Section
6.10.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended from time to time. Section references to ERISA are to ERISA, as in
effect at the date of this Agreement, and to any subsequent provisions of
ERISA, amendatory thereof, supplemental thereto or substituted therefor.
"ERISA Affiliate" shall mean any person (as defined in Section 3(9) of
ERISA) which together with CBI or Omni Bank would be a member of the same
"controlled group" within the meaning of Section 414(b), (m), (c) and (o) of
the Code.
"FDIC" shall mean the Federal Deposit Insurance Corporation.
"Federal Reserve" shall mean the Board of Governors of the Federal
Reserve System.
"Illinois Act" shall mean the Illinois Banking Act.
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"Illinois BCA" shall mean the Illinois Business Corporation Act of
1983, as amended.
"Illinois BHCA" shall mean the Illinois Bank Holding Company Act of
1957, as amended.
"Indemnity Agreement" shall have the meaning set forth in Section 2.7.
"IRS" shall mean the United States Internal Revenue Service.
"Merger" shall mean the merger of Acquisition Corp with and into CBI.
"Merging Corporations" shall collectively mean CBI and Acquisition
Corp.
"Omni Bank" shall mean Omni Bank, an Illinois state bank with its main
office located in Macomb, Illinois.
"Paying Agent" shall mean UnionBank, an Illinois state bank with its
main office located in Streator, Illinois.
"Person" shall mean any individual, partnership, joint venture, firm,
corporation, association, trust or other enterprise or any government or
political subdivision or any agency, department or instrumentality thereof.
"Proxy Statement" shall have the meaning provided in Section 6.4.
"Special Meeting" shall mean the special meeting of shareholders of CBI
to be held pursuant to Section 6.4.
"Subsequent CBI Financial Statements" shall have the meaning provided
in Section 6.3.
"Subsidiary" shall mean, as to any Person: (i) any corporation more
than 50% of whose stock of any class or classes having by the terms thereof
ordinary voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at the time stock of any class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time owned by such Person and/or one or
more Subsidiaries of such Person; and (ii) any partnership, association, joint
venture or other entity in which such Person and/or one or more Subsidiaries of
such Person has more than a 50% equity interest at the time.
"Surviving Corporation" shall mean the corporation resulting from the
merger of Acquisition Corp with and into CBI.
"Termination Date" shall mean December 31, 1996, or such later date as
shall have been agreed to in writing by the parties.
"Transmittal Letter" shall mean the form to be used by shareholders of
CBI in surrendering their shares of CBI Stock in exchange for cash.
"Union" shall mean UnionBancorp, Inc., a Delaware corporation.
"Union Common Stock" shall mean the common stock of Union, $1.00 par
value per share.
"Union Financial Statements" shall have the meaning provided in Section
5.8.
"Union Subsidiaries" shall mean all of the direct and indirect
Subsidiaries of Union.
SECTION 1.2 PRINCIPLES OF CONSTRUCTION. (a) In this Agreement, unless
otherwise stated or the context otherwise requires, the following usages apply:
(i) actions permitted under this Agreement may be taken at any time and from
time to time in the actor's sole discretion; (ii) references to a statute shall
refer to the statute and any successor statute, and to all regulations
promulgated under or implementing the statute or successor, as in effect at the
relevant time; (iii) in computing periods from a specified date to a later
specified date, the words "from" and "commencing on" (and the like) mean "from
and including," and the words "to," "until" and "ending on" (and the like) mean
"to, but excluding"; (iv) references to a governmental or quasi-governmental
agency, authority or instrumentality shall also refer to a regulatory body that
succeeds to the functions of the agency, authority or instrumentality; (v)
indications of time of day mean Ottawa, Illinois time; (vi) "including" means
"including, but not
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limited to"; and (vii) all references to sections, schedules and exhibits are
to sections, schedules and exhibits in or to this Agreement unless otherwise
specified.
(b) All accounting terms not specifically defined herein shall be
construed in accordance with generally accepted accounting principles in the
United States consistent with those used in the preparation of the most recent
financial statements of CBI or audited financial statements of Union, as the
case may be.
SECTION 1.3 CBI BOOK OF SCHEDULES. The CBI Book of Schedules referred
to in this Agreement shall consist of the agreements and other documentation
described and referred to in this Agreement with respect to CBI. The CBI Book
of Schedules shall be delivered by CBI to Union and its counsel by 5:00 p.m.,
Ottawa, Illinois time, on the fifteenth day after the date of this Agreement.
Union shall have until 5:00 p.m., Ottawa, Illinois time, on the twentieth day
after the date of this Agreement to review the CBI Book of Schedules. If after
such review Union finds any of the matters disclosed in the CBI Book of
Schedules to be, in its sole determination, unacceptable to it, Union shall
have the right to terminate the Agreement by written notice sent to CBI by 5:00
p.m., Ottawa, Illinois time, of such twentieth day. Any such termination shall
have the effect as set forth in Section 13.2.
ARTICLE 2
THE MERGER
SECTION 2.1 MANNER OF MERGER. Upon the terms and subject to the
conditions of this Agreement, at the Effective Time (as defined below),
Acquisition Corp shall be merged with and into CBI pursuant to the provisions
of, and with the effect provided in, the Illinois Business Corporation Act of
1983, as amended (the "Illinois BCA"), and CBI shall be the corporation
resulting from such merger (the "Surviving Corporation"). As a result of the
Merger, each share of CBI Common Stock and CBI Preferred Stock issued and
outstanding immediately prior to the Effective Time, other than Dissenting
Shares (as defined below), will be converted into the right to receive the Cash
Price Per Common Share and the Cash Price Per Preferred Share, respectively, as
each such term is defined below.
SECTION 2.2 EFFECT OF MERGER. (a) At the Effective Time, Acquisition
Corp shall be merged with and into CBI and CBI shall be the Surviving
Corporation. CBI and Acquisition Corp are sometimes referred to collectively
herein as the "Merging Corporations."
(b) Without limiting the generality of the foregoing, at the
Effective Time, the Surviving Corporation shall thereupon and thereafter
possess all the rights, privileges, immunities and franchises, as of a public
or a private nature, of each of the Merging Corporations, and all property,
real, personal and mixed, and all debts due on whatever account, including
subscriptions to shares, and all other choses in action, and all and every
other interest, of or belonging to or due to each of the Merging Corporations,
shall be taken and deemed to be transferred to and vested in the Surviving
Corporation without further act or deed; and the title to any real estate, or
any interest therein, vested in any of such corporations shall not revert or be
in any way impaired by reason of the Merger. The Surviving Corporation shall
assume and thenceforth be responsible and liable for all the liabilities and
obligations of each of the Merging Corporations and any claim existing or
action or proceeding pending by or against any of the Merging Corporations may
be prosecuted to judgment as if the Merger had not taken place, or the
Surviving Corporation may be substituted in its place. Neither rights of
creditors nor any liens upon the property of any of the Merging Corporations
shall be impaired by the Merger.
SECTION 2.3 ARTICLES OF INCORPORATION. From and after the Effective
Time and until amended as provided by law, the articles of incorporation of the
Surviving Corporation shall be the articles of incorporation of CBI as in
effect immediately prior to the Effective Time.
SECTION 2.4 BYLAWS. From and after the Effective Time and until
amended as provided by law, the bylaws of the Surviving Corporation shall be
the bylaws of CBI as in effect immediately prior to the Effective Time.
SECTION 2.5 DIRECTORS AND OFFICERS. The directors and officers of
Acquisition Corp immediately prior to the Effective Time shall serve as the
directors and officers of the Surviving Corporation until their successors
shall have been elected or appointed and shall have qualified in accordance
with the Illinois BCA and the articles of incorporation and bylaws of the
Surviving Corporation.
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SECTION 2.6 UNION'S DELIVERIES AT CLOSING. At the closing of the
Merger (the "Closing"), Union shall deliver, or cause to be delivered to CBI
the following items:
(a) evidence of the delivery by Union or its agents to the Paying
Agent (as defined below) of the aggregate Cash Price Per Common Share and the
Cash Price Per Preferred Share for payment to the holders of CBI Common Stock
and CBI Preferred Stock, respectively;
(b) a good standing certificate for Union issued by the Secretary
of State of each of the States of Delaware and Illinois, and dated in each case
not more than 15 Business Days prior to the Closing Date, as defined below;
(c) a good standing certificate for Acquisition Corp issued by the
Secretary of State of the State of Illinois and dated not more than 15 Business
Days prior to the Closing Date;
(d) a copy of the certificate of incorporation of Union certified
not more than 15 Business Days prior to the Closing Date by the Secretary of
State of the State of Delaware;
(e) a copy of the articles of incorporation of Acquisition Corp
certified not more that 15 Business Days prior to the Closing Date by the
Secretary of State of the State of Illinois;
(f) a certificate of the Secretary or any Assistant Secretary of
Union dated the Closing Date certifying a copy of the bylaws of Union;
(g) a certificate of the Secretary or any Assistant Secretary of
Acquisition Corp dated the Closing Date certifying a copy of the bylaws of
Acquisition Corp;
(h) copies of resolutions of the board of directors of Union
authorizing and approving this Agreement and the consummation of the
transactions contemplated hereby, certified as of the Closing Date by the
Secretary or any Assistant Secretary of Union;
(i) copies of resolutions of the board of directors and the sole
shareholder of Acquisition Corp authorizing and approving this Agreement and
the consummation of the transactions contemplated hereby, certified as of the
Closing Date by the Secretary or any Assistant Secretary of Acquisition Corp;
(j) a certificate of the President or any Vice President and the
Secretary or any Assistant Secretary of Union dated the Closing Date certifying
that: (i) there have been no further amendments to the certificate or articles
of incorporation delivered pursuant to subsections (d) and (e) of this Section;
(ii) all of the representations and warranties of Union and Acquisition Corp
set forth in this Agreement are true and correct with the same force and effect
as if all of such representations and warranties were made at the Closing Date;
and (iii) each of Union and Acquisition Corp has performed or complied with all
of the covenants and obligations to be performed or complied with by Union and
Acquisition Corp, respectively, under the terms of this Agreement on or prior
to the Closing Date;
(k) copies of each of the regulatory approvals necessary to
consummate the transactions contemplated herein;
(l) a legal opinion of Union's counsel, Barack, Ferrazzano,
Kirschbaum & Perlman, in the form set forth in Exhibit A attached hereto and
dated as of the Effective Time;
(m) such other documents as CBI or its counsel shall reasonably
request.
SECTION 2.7 CBI'S DELIVERIES AT CLOSING. At the Closing, CBI shall
deliver, or cause to be delivered to Union the following items:
(a) a good standing certificate for CBI issued by the Secretary of
State of the State of Illinois and dated not more than 15 Business Days prior
to the Closing Date;
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(b) a good standing certificate for Omni Bank, an Illinois state
bank with its main office located in Macomb, Illinois ("Omni Bank"), issued by
the Commissioner of Banks and Trust Companies of the State of Illinois (the
"Commissioner"), and dated not more than 15 Business Days prior to the Closing
Date;
(c) a copy of the articles of incorporation of CBI certified by the
Secretary of State of the State of Illinois not more that 15 Business Days
prior to the Closing Date;
(d) a copy of the charter of Omni Bank certified by the
Commissioner not more than 15 Business Days prior to the Closing Date;
(e) a certificate of the Secretary or any Assistant Secretary of
CBI dated the Closing Date certifying a copy of the bylaws of CBI;
(f) a certificate of the Cashier or any Assistant Cashier of Omni
Bank dated the Closing Date certifying a copy of the bylaws of Omni Bank;
(g) copies of resolutions of the board of directors and
shareholders of CBI authorizing and approving this Agreement and the
consummation of the transactions contemplated hereby, certified as of the
Closing Date by the Secretary or any Assistant Secretary of CBI;
(h) a certificate executed by the President or any Vice President
and the Secretary or any Assistant Secretary of CBI dated the Closing Date
certifying that: (i) there have been no further amendments to the articles of
incorporation and charter delivered pursuant to subsections (c) and (d) of this
Section; (ii) all of the representations and warranties of CBI set forth in
this Agreement are true and correct with the same force and effect as if all of
such representations and warranties were made at the Closing Date; and (iii)
CBI has performed or complied with all of the covenants and obligations to be
performed or complied with by CBI under the terms of this Agreement on or prior
to the Closing Date;
(i) a list of CBI's shareholders as of the Closing Date certified
by the Secretary or any Assistant Secretary of CBI;
(j) the written resignation of each person serving immediately
prior to the Effective Time as a director of Omni Bank;
(k) a legal opinion of CBI's counsel, Gerrish & McCreary, P.C., in
the form set forth in Exhibit B attached hereto and dated as of the Effective
Time;
(l) a non-competition agreement in the form attached as Exhibit C,
dated as of the Effective Time and executed by each of the holders of greater
than 10% of the issued and outstanding shares of CBI Common Stock as of the
date of this Agreement;
(m) an indemnity agreement in the form attached as Exhibit D, dated
as of the Effective Time and executed by each of the holders of greater than
10% of the issued and outstanding shares of CBI Common Stock as of the date of
this Agreement (the "Indemnity Agreement");
(n) an office lease in the form attached as Exhibit E, dated as of
the Effective Time and executed by the record owner, of the premises currently
used by Omni Bank for its branch operations in Paloma, Illinois; and
(o) such other documents as Union or its counsel shall reasonably
request.
SECTION 2.8 CLOSING; EFFECTIVE TIME. (a) The Closing shall be on a
date agreed to by the parties hereto (the "Closing Date"). In the event the
parties fail to so agree, the Closing shall take place on the last Business Day
of the month in which: (i) the last required regulatory approval of the Merger
is received; (ii) the last requisite waiting period has expired; or (iii) all
of the conditions provided for in Sections 8, 9 and 10 have been met or waived
in writing; whichever is later.
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(b) The parties hereto agree to file on the Closing Date
appropriate articles of merger, as contemplated by Section 11.25 of the
Illinois BCA (the "Articles of Merger"), with the Secretary of State of the
State of Illinois. The Merger shall be effective upon the close of business on
the day when the Articles of Merger have been accepted for filing by the
Secretary of State of the State of Illinois (the "Effective Time").
(c) Unless otherwise agreed by the parties hereto, the Closing
shall take place at 10:00 a.m. on the Closing Date, at such place as the
parties hereto may mutually agree, and in the event they fail to agree, at
Union's offices located at 122 West Madison Street, Ottawa, Illinois.
ARTICLE 3
TREATMENT OF AND PAYMENT FOR SHARES
SECTION 3.1 TREATMENT OF ACQUISITION CORP STOCK. All of the shares of
common stock, no par value per share, of Acquisition Corp issued and
outstanding immediately prior to the Effective Time shall at the Effective Time
be converted into and shall thereafter represent all of the issued and
outstanding stock of the Surviving Corporation.
SECTION 3.2 TREATMENT OF CBI STOCK. (a) Subject to the provisions of
this Article 3, and without any action on the part of the holder thereof, at
the Effective Time:
(i) each share of CBI Stock which is held in the treasury
of CBI or Omni Bank, other than as a trustee, fiduciary, nominee or in
a similar capacity, shall be canceled and retired and shall cease to
exist from and after the Effective Time, and no cash, securities or
other consideration shall be delivered in exchange therefor;
(ii) each share of CBI Preferred Stock issued and
outstanding immediately prior to the Effective Time shall be deemed
surrendered and automatically converted into and shall thereafter
represent the right to receive an amount in cash equal to $295.00 per
share, plus the amount of any accrued but unpaid dividends with respect
to such share (the "Cash Price Per Preferred Share"); and
(iii) each share of CBI Common Stock issued and outstanding
immediately prior to the Effective Time shall be deemed surrendered and
automatically converted into and shall thereafter represent the right
to receive an amount in cash equal to the quotient of:
(A) $11,445,000, as the same may be increased
pursuant to Section 8.15 (the "Aggregate Amount"), less the sum
of:
(1) the total amount paid by Union
pursuant to Section 6.9 at the direction of CBI to
satisfy any CBI Closing Obligations (as defined
below); and
(2) the total amount necessary to pay the
aggregate Cash Price Per Preferred Share to the
holders of CBI Preferred Stock; divided by
(B) the number of shares of CBI Common Stock
issued and outstanding immediately prior to the Effective Time
(the "Cash Price Per Share").
(b) After the Effective Time, no holder of CBI Stock which is
issued and outstanding immediately prior to the Effective Time will have any
rights in respect of such CBI Stock except to receive cash for the shares of
CBI Stock as provided in this Section 3.2 or to receive payment for such shares
of CBI Stock in the manner and to the extent provided in Section 11.70 of the
Illinois BCA.
SECTION 3.3 STEPS OF TRANSACTION. (a) As soon as practicable after
the date of the Special Meeting (as defined below), Union shall mail or cause
to be mailed to each then current holder of record of a certificate or
certificates representing outstanding shares of CBI Stock (the "Certificates")
instructions for the transmittal of the Certificates (the "Transmittal Letter")
and shall specify that delivery shall be effected, and risk of loss and title
to the Certificates shall pass, only upon delivery of the Certificates (or a
lost certificate affidavit and a bond in a form reasonably acceptable to
Union). Pursuant to the terms of a paying agent agreement in the form attached
as Exhibit
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F, the parties hereto agree to appoint UnionBank, Streator, Illinois, as paying
agent (the "Paying Agent"), for the parties to effect the surrender of the
Certificates in exchange for cash and to cause the Paying Agent to comply with
the terms of such Paying Agent Agreement. Union shall use its best efforts to
mail or cause to be mailed the Transmittal Letter to all persons who become
holders of CBI Stock subsequent to the Special Meeting and prior to the close
of business of CBI on the date which is ten Business Days prior to the Closing
Date.
(b) As promptly as practicable after the Effective Time, Union
shall cause the Paying Agent to deliver to each holder of CBI Stock who has
submitted an effective Transmittal Letter accompanied by the Certificates
covered by such Transmittal Letter cash in the amounts required by Section 3.2.
(c) As promptly as practicable after the Effective Time, Union
shall send to each holder of record of CBI Stock immediately prior to the
Effective Time who has not previously submitted his or her Certificates,
additional copies of the Transmittal Letter for use in surrendering such
Certificates to the Paying Agent in exchange for cash.
(d) The right to receive cash into and for which each share of CBI
Stock shall have been converted pursuant to this Agreement, shall be deemed to
have been paid in full satisfaction of all rights pertaining to such converted
shares of CBI Stock.
(e) At the Effective Time, CBI shall deliver a certified copy of a
list of its shareholders to Union after which there shall be no further
registration or transfers on the stock transfer books of CBI of the shares of
CBI Stock which were outstanding immediately prior to the Effective Time. If,
after the Effective Time, Certificates representing such shares are presented
to Union, they shall be cancelled and exchanged for cash as provided in this
Agreement.
(f) If any cash is to be paid to a person other than the person
whose name appears on any Certificate surrendered, it shall be a condition of
the payment thereof that the Certificate so surrendered shall be properly
endorsed, accompanied by all documents required to evidence and effect such
transfer and otherwise in proper form for transfer and that the person
requesting such payment shall pay to Union any transfer or other taxes required
by reason of such payment to a person other than the registered holder of the
Certificate surrendered, or otherwise required, or shall establish to the
satisfaction of Union that such tax has been paid or is not payable.
3.4 DISSENTING SHARES. Notwithstanding anything to the contrary
contained in this Agreement, to the extent appraisal rights are available to
CBI shareholders pursuant to the Illinois BCA, any shares held by a person who
objects to the Merger, whose shares either were not entitled to vote or were
not voted in favor of the Merger and who complies with all of the provisions of
the Illinois BCA concerning the rights of such person to dissent from the
Merger and to require appraisal of such person's shares and who has not
withdrawn such objection or waived such rights prior to the Closing Date
("Dissenting Shares") shall not be converted pursuant to Section 3.2 but shall
become the right to receive such consideration as may be determined to be due
to the holder of such Dissenting Shares pursuant to the Illinois BCA,
including, if applicable, any costs determined to be payable by CBI to the
holders of the Dissenting Shares pursuant to an order of the appropriate
Illinois Circuit Court in accordance with the Illinois BCA; provided, however,
that each Dissenting Share held by a person at the Effective Time who shall,
after the Effective Time, withdraw the demand for appraisal or lose the right
of appraisal, in either case pursuant to the Illinois BCA shall be deemed to be
converted, as of the Effective Time, into the Cash Price Per Share Amount,
without any interest thereon.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES BY CBI
CBI hereby represents and warrants to Union as follows:
SECTION 4.1 CBI ORGANIZATION. CBI: (a) is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Illinois, is a registered bank holding company under the federal Bank Holding
Company Act of 1956, as amended (the "BHCA"), and is duly qualified to do
business and is in good standing in each other jurisdiction in which the nature
of the business conducted or the properties or assets owned or leased by it
makes such qualification necessary and where failure to be so qualified would
reasonably be expected to have a
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material adverse effect on the consolidated financial condition, assets or
business of CBI and Omni Bank; (b) has full power and authority, corporate and
otherwise, to own, operate and lease its properties as presently owned,
operated and leased, and to carry on its business as it is now being conducted;
and (c) has the requisite corporate power and authority to enter into and
perform its obligations under this Agreement in accordance with its terms.
Except as set forth on Schedule 4.1 of the CBI Book of Schedules, CBI owns no
voting stock or equity securities of any corporation, association, partnership
or other entity, other than all of the issued and outstanding stock of Omni
Bank.
SECTION 4.2 CBI CAPITALIZATION. The authorized capital stock of CBI
consists, and at the Effective Time will consist, of: (a) 50,000 shares of
common stock, $1.00 par value per share, of which as of the close of business
on the date of this Agreement 26,225 shares were outstanding and no shares were
held in the treasury; (b) 450 shares of Series 1 Class A preferred stock,
$295.00 par value per share, of which as of the close of business on the date
of this Agreement 383 shares were outstanding; and (c) 5,000 shares of Series 2
Class A preferred stock, $295.00 par value per share, of which as of the close
of business on the date of this Agreement 683 shares were outstanding. The
maximum number of shares of CBI Common Stock (assuming for this purpose that
share equivalents constitute CBI Common Stock) that would be outstanding as of
the Effective Time if all options, warrants, conversion rights and other rights
with respect thereto were exercised and the restrictions on any restricted
stock were no longer applicable is 26,225. All of the outstanding shares of
capital stock of CBI have been duly and validly authorized and issued and are
fully paid and nonassessable. Except as set forth on Schedule 4.2 of the CBI
Book of Schedules, there are no outstanding subscriptions, contracts,
conversion privileges, options, warrants, calls or other rights obligating CBI
or Omni Bank to issue, sell or otherwise dispose of, or to purchase, redeem or
otherwise acquire, any shares of capital stock of CBI or Omni Bank.
SECTION 4.3 OMNI BANK ORGANIZATION. Omni Bank is an Illinois state
bank with its main office located in Macomb, Illinois, and is duly organized,
validly existing and in good standing under the laws of the State of Illinois.
Omni Bank has full power and authority, corporate or otherwise, to carry on its
business as it is now being conducted and to own or hold under lease the
properties and assets it owns or holds under Lease. Except as set forth on
Schedule 4.3 of the CBI Book of Schedules, Omni Bank owns no voting stock or
equity securities of any corporation, association, partnership or other entity.
All of the deposit liabilities of Omni Bank are insured by the Federal Deposit
Insurance Corporation ("FDIC") through the BIF to the fullest extent permitted
by applicable law and Omni Bank pays the lowest premium assessed by the FDIC
for such deposit insurance.
SECTION 4.4 OMNI BANK CAPITALIZATION. The authorized capital stock of
Omni Bank consists, and at the Effective Time will consist, of 1,800 shares of
common stock, $100 par value per share, all of which shares are issued and
outstanding. All of the outstanding shares of capital stock of Omni Bank have
been duly and validly authorized and issued and are fully paid and
nonassessable and owned by CBI. There are no options, warrants, rights, calls
or commitments of any character relating to any additional shares of the
capital stock of Omni Bank. No capital stock or other security issued by Omni
Bank has been issued in violation of, or without compliance with, the rights of
shareholders.
SECTION 4.5 AUTHORIZATION. CBI has the requisite corporate power and
authority to enter into and perform its obligations under this Agreement and
the execution, delivery and performance of this Agreement by CBI, and
consummation by it of the transactions contemplated hereby have been authorized
by all necessary corporate action other than the requisite approval of the
holders of CBI Common Stock and CBI Preferred Stock. Subject to such
shareholders' approval, this Agreement constitutes a legal, valid and binding
obligation of CBI enforceable in accordance with its terms, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization or other
laws and subject to general principles of equity.
SECTION 4.6 LITIGATION AND REGULATORY MATTERS. Schedule 4.6 of the
CBI Book of Schedules sets forth a list of all actions, suits, agreements with
regulatory authorities or legal or administrative proceedings pending or
existing as of the date hereof in or to which CBI or Omni Bank is a named party
or is subject. Except as set forth on Schedule 4.6 of the CBI Book of
Schedules, there is no action, suit, proceeding, claim or formal written
protest by any Person or agency, or any investigation, report or agreement by
or with any regulatory authority having jurisdiction over CBI or Omni Bank or
any of its respective assets or businesses which exists or is pending or, to
CBI's knowledge, threatened against CBI or Omni Bank, or any of its respective
officers or directors in their capacities as such, or its assets, business or
goodwill which would reasonably be expected to have a material adverse effect
on the consolidated financial condition, assets or business of CBI and Omni
Bank or which would impair
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CBI's ability to consummate the Merger. CBI further represents and warrants
that except as set forth on Schedule 4.6 of the CBI Book of Schedules, it does
not know or have any reason to believe that there is any basis for assertion
against it or Omni Bank of any material claims based upon the wrongful action
or inaction of either CBI or Omni Bank, and any of its officers, directors or
employees which would reasonably be expected to have a material adverse effect
on the consolidated financial condition, assets or business of CBI and Omni
Bank or which would impair CBI's ability to consummate the Merger. Neither CBI
nor Omni Bank is subject to, or in default with respect to, nor are any of its
assets subject to, any outstanding judgment, regulatory agreement, injunction,
writ, order or decree or any other requirement of any governmental body or
court or of any governmental agency or instrumentality which would reasonably
be expected to have a material adverse effect on the consolidated financial
condition, assets or business of CBI and Omni Bank.
SECTION 4.7 INSURANCE. Schedule 4.7 of the CBI Book of Schedules
lists and briefly describes the policies of insurance (including bankers
blanket bond and insurance providing benefits for employees) owned or held by
CBI or Omni Bank on the date hereof. Each such policy is, and CBI will use its
best efforts to keep each such policy, in full force and effect (except for any
expiring policy which is replaced by coverage at least as extensive) until the
Effective Time. All premiums due on such policies have been paid.
SECTION 4.8 DEFAULTS UNDER AGREEMENTS. Neither CBI nor Omni Bank is
in default or, to the best of their knowledge, alleged to be in default, under
any loan or credit agreement, conditional sales contract or other title
retention agreement or security agreement relating to money borrowed by CBI or
Omni Bank, agreements pursuant to which it leases real or personal property or
any other instrument or obligation, which would reasonably be expected to have
a material adverse effect on the consolidated financial condition, assets or
business of CBI and Omni Bank. Neither CBI nor Omni Bank is in default in any
material respect and CBI has no knowledge of any material default under such
instruments by any other party thereto and has no knowledge of any event which
with notice or lapse of time or both would constitute a material default.
SECTION 4.9 FINANCIAL STATEMENTS AND REPORTS. Copies of the following
financial statements and reports of CBI and Omni Bank (collectively, the "CBI
Financial Statements") are set forth on Schedule 4.9 of the CBI Book of
Schedules:
(a) Consolidated Balance Sheets and the related Statements of
Income, Statements of Changes in Shareholders' Equity and Statements of Cash
Flows of CBI (or its predecessors) for the years ended December 31, 1991, 1992,
1993 and 1994;
(b) Report of CBI on Form F.R. Y-6 at the close of business on
December 31, 1994; and
(c) Consolidated Reports of Condition and Income (the "Call
Reports") for Omni Bank (or its predecessors) at the close of business on March
31, June 30 and September 30, 1995, and December 31, 1992, 1993 and 1994.
The CBI Financial Statements are complete and correct in all material
respects and fairly present the respective financial positions of CBI and Omni
Bank at the dates shown and the results of operations for the periods covered.
The CBI Financial Statements described above have been prepared on a basis
consistent with past accounting practices and as required by applicable rules
or regulations and fairly present the financial condition and results of
operations at the dates and for the periods presented, subject to year-end
audit adjustments (which changes in the aggregate would not reasonably be
expected to be materially adverse). The CBI Financial Statements do not
include any material assets or omit to state any material liabilities, absolute
or contingent, or other facts, which inclusion or omission would render the CBI
Financial Statements misleading in any material respect.
SECTION 4.10 LOAN LOSS RESERVE. The reserve for possible loan and
lease losses shown on the September 30, 1995 Call Report for Omni Bank is
adequate in all material respects under the requirements of generally accepted
accounting principles to provide for possible losses, net of recoveries
relating to loans previously charged off, on loans outstanding (including
accrued interest receivable) as of September 30, 1995. Except as set forth on
Schedule 4.10 of the CBI Book of Schedules, to the best knowledge and belief of
CBI, the aggregate loan balances at such date in excess of such reserves are,
based on past loan loss experience, collectible in accordance with their terms,
and all uncollectible loans have been charged off.
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SECTION 4.11 REGULATORY FILINGS. Each of CBI and Omni Bank has filed
in a timely manner all required filings with all proper regulatory
authorities, including: (a) the Board of Governors of the Federal Reserve
System (the "Federal Reserve"); (b) the FDIC; and (c) the Commissioner. To the
best knowledge of CBI, all such filings were accurate and complete in all
material respects as of the dates of the filings, and no such filing has made
any untrue statement of a material fact or omitted to state a material fact
necessary in order to make the statements made, in light of the circumstances
under which they were made, not misleading.
SECTION 4.12 PROPERTIES, CONTRACTS, EMPLOYEE BENEFIT PLANS AND OTHER
AGREEMENTS. Schedule 4.12 of the CBI Book of Schedules lists or describes the
following:
(a) Each parcel of real property owned by CBI or Omni Bank and the
principal buildings and structures located thereon, together with a legal
description of such real estate, and each lease of real property to which CBI
or Omni Bank is a party, identifying the parties thereto, the annual rental
payable, the expiration date thereof and a brief description of the property
covered, and in each case of either owned or leased real property, a
description of the property's current use, including, if applicable,
identification of each such property as a branch or main office of Omni Bank;
(b) Each loan and credit agreement, conditional sales contract or
other title retention agreement or security agreement relating to money
borrowed by CBI or Omni Bank, exclusive of any deposit agreement with customers
of Omni Bank entered into in the ordinary course of business, agreement for the
purchase of federal funds and repurchase agreement;
(c) Each agreement, loan, contract, lease, guarantee, letter of
credit, line of credit or commitment of CBI or Omni Bank not referred to
elsewhere in this Section which:
(i) involves payment by CBI or Omni Bank (other than as
disbursement of loan proceeds to customers) of more than $10,000 in
any calendar year, or of more than $20,000 when aggregated with any of
the foregoing that involved payments of less than $10,000 in any
calendar year;
(ii) involves payments based on profits of CBI or Omni Bank;
(iii) relates to the future purchase of goods or services in
excess of the requirements of its respective business at current
levels or for normal operating purposes;
(iv) was not made in the ordinary course of business; or
(v) materially affects the business or consolidated financial
condition of CBI and Omni Bank;
(d) Each profit sharing, group insurance, hospitalization, stock
option, pension, retirement, bonus, deferred compensation, stock bonus, stock
purchase or other employee welfare or benefit agreement, plan, contract or
arrangement under which pensions, deferred compensation and any other
retirement or employee benefits are being paid, may become payable, provided or
made available by CBI or Omni Bank, which was established, maintained,
sponsored or undertaken by CBI or Omni Bank for the benefit of its respective
officers, directors or employees, including each trust or other agreement with
any custodian or any trustee for funds held under any such agreement, plan or
arrangement, and all other agreements, contracts or arrangements under which
pensions, deferred compensation or other retirement benefits are being paid or
may become payable by CBI or Omni Bank (collectively, the "Employee Benefit
Plans"), and, in respect to any of them, the latest reports or forms, if any,
filed with the Department of Labor and Pension Benefit Guaranty Corporation
under ERISA, any current financial or actuarial reports and any currently
effective United States Internal Revenue Service ("IRS") private rulings or
determination letters obtained by or for the benefit of CBI or Omni Bank;
(e) Each lease or license to which CBI or Omni Bank is a party
with respect to personal property, whether as lessee or licensee, with rental
or other payments due thereunder in excess of $12,000 in any calendar year, or
of more than $20,000 in any calendar year when aggregated with any of the
foregoing that involved payments of less than $10,000 in any calendar year;
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(f) Any collective bargaining agreement and each employment and
consulting contract or similar arrangement between any Person and CBI or Omni
Bank (except for any ordinary oral employment contract with an employee of CBI
or Omni Bank creating an at will employment relationship); and
(g) The name and annual salary of each director, officer or
employee of CBI or Omni Bank, and the profit sharing, bonus or other form of
compensation (other than salary) paid or payable by CBI, Omni Bank or a
combination of both to or for the benefit of each such person in question for
the current year and for the year ended December 31, 1995.
Copies of each document, plan or contract listed and described on
Schedule 4.12 of the CBI Book of Schedules are appended to such Schedule and
included in the CBI Book of Schedules.
SECTION 4.13 DISCLOSURES. No representation or warranty made herein
by CBI contains any untrue statement of a material fact, or omits to state a
material fact necessary to make the statements contained herein under the
circumstances under which they were made not misleading, and CBI has made full
disclosure of all material facts with respect to CBI and Omni Bank. Except as
and to the extent reflected or reserved against in the CBI Financial Statements
for the year ended December 31, 1994, and the Call Reports of Omni Bank, each
referenced in Section 4.9 above, or the Subsequent CBI Financial Statements (as
defined below), neither CBI nor Omni Bank has, and with respect to the
Subsequent CBI Financial Statements will not have, any liabilities or
obligations, of any nature, secured or unsecured, (whether accrued, absolute,
contingent or otherwise) including any tax liabilities due or to become due,
which would reasonably be expected to have a material adverse effect on the
consolidated financial condition, assets or business of CBI and Omni Bank.
SECTION 4.14 EFFECT OF AGREEMENT. Except as set forth in Schedule
4.14 of the CBI Book of Schedules, the execution, delivery and performance of
this Agreement by CBI and the consummation by it of the transactions
contemplated hereby do not: (a) require the consent, waiver, order,
registration, qualification, approval, license or authorization of any Person,
court, regulatory authority or other governmental body, other than approval of
the holders of CBI Common Stock and CBI Preferred Stock and as may be required
in connection or in compliance with the provisions of the Illinois BCA, the
BHCA, the Illinois Bank Holding Company Act of 1957, as amended (the "Illinois
BHCA"), and the Illinois Banking Act (the "Illinois Act"); (b) violate, with or
without the giving of notice or the passage of time or both, in any material
respect any provision of law applicable to CBI or Omni Bank; (c) conflict with
or result in a breach of any terms of its articles of incorporation or bylaws
or any material mortgage, deed of trust, license, indenture or other agreement
or instrument, or any order, judgment, decree, statute, regulation or other
restriction of any kind or character, to which CBI or Omni Bank is a party or
by which CBI or Omni Bank or any of its respective assets may be bound; (d)
give to others any right to accelerate or terminate, or result in acceleration
or termination of, any such agreement or instrument; (e) result in termination
of any provision of any such agreement or instrument; or (f) result in the
creation of any lien, charge or encumbrance upon any of the property or assets
of CBI or Omni Bank.
SECTION 4.15 ARTICLES OF INCORPORATION, CHARTERS AND BYLAWS. The
copies of: (a) the articles of incorporation and all amendments thereto of CBI;
(b) the bylaws of CBI, as amended to date; (c) the charter and all amendments
thereto of Omni Bank; and (d) the bylaws of Omni Bank, as amended to date, are
all complete and correct and set forth on Schedule 4.15 of the CBI Book of
Schedules.
SECTION 4.16 BOOKS AND RECORDS. Except for an adjustment of
approximately $34,000 made in December, 1995, in CBI's deferred taxes account,
the books and records of CBI and Omni Bank are in all material respects
complete and correct and accurately reflect the basis for the respective
financial condition and results of operations of CBI and Omni Bank set forth in
the CBI Financial Statements.
SECTION 4.17 INTERIM EVENTS. Except as set forth in Schedule 4.17 of
the CBI Book of Schedules, since September 30, 1995, neither CBI nor Omni Bank
has:
(a) Suffered any changes having a material adverse effect on the
consolidated financial condition, assets or business of CBI and Omni Bank, or
in the operation or conduct of its business;
(b) Suffered any material damage, destruction or loss to any of
its properties whether covered by insurance or not;
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(c) Declared any dividend or other distribution with respect to
its stock (except for payment of dividends and distributions from Omni Bank
solely to CBI), repurchased or redeemed shares of its stock, issued any shares
of its stock or sold or agreed to issue or sell any of its stock or any right
to purchase or acquire any such stock or any security convertible into such
stock or taken any action to reclassify, recapitalize or split up its stock or
issued any stock appreciation rights;
(d) Granted or agreed to grant any increase in benefits payable or
to become payable under any Employee Benefit Plan;
(e) Cancelled or compromised any debt or claim other than in the
ordinary course of business;
(f) Entered into any transaction, contract or commitment other
than in the ordinary course of business;
(g) Incurred any obligation or liability (fixed or contingent)
other than obligations and liabilities incurred in the ordinary course of its
business;
(h) Mortgaged, pledged or subjected to a lien, security interest
or other encumbrance any of its assets except to tax and other liens which
arise by operation of law and with respect to which payment is not past due and
except for pledges or liens: (i) required to be granted in connection with the
acceptance by Omni Bank of government deposits; (ii) granted in connection with
repurchase or reverse repurchase agreements; or (iii) otherwise incurred in the
ordinary course of the conduct of its business;
(i) Conducted its business in any manner other than substantially
as it was being conducted prior to such time;
(j) Leased, sold or otherwise disposed of any of its assets except
in the ordinary course of business or leased, purchased or otherwise acquired
from third parties any assets except in the ordinary course of business;
(k) Except for the transactions contemplated by this Agreement,
merged, consolidated or agreed to merge or consolidate with or into any other
Person, or acquired or agreed to acquire any stock, equity interest or business
of any other Person;
(l) Agreed to enter into any transaction for the borrowing or
loaning of monies, other than in the ordinary course of business;
(m) Made any principal or interest payment on any outstanding
indebtedness of CBI; or
(n) Increased the salary of any officer or the compensation or
fees payable to any director, except for normal increases in the ordinary
course of business or in accordance with any Employee Benefit Plan, or entered
into any employment contract with any officer or salaried employee or
implemented or made any material amendment to any employee welfare, stock
option, profit sharing or other similar plan or arrangement.
SECTION 4.18 TAXES. Each of CBI and Omni Bank has filed with the
appropriate governmental agencies all federal, state and local income,
franchise, excise, sales, use, real and personal property and other tax returns
and reports required to be filed by it. Except as set forth on Schedule 4.18
of the CBI Book of Schedules, neither CBI nor Omni Bank is: (a) delinquent in
the payment of any taxes shown on such returns or reports or on any assessments
received by it for such taxes; (b) aware of any pending or threatened
examination for income taxes for any year by the IRS or any state tax agency;
(c) subject to any agreement extending the period for assessment or collection
of any federal or state tax; or (d) a party to any action or proceeding nor has
any claim been asserted against it by any governmental authority for assessment
or collection of taxes. None of the tax liabilities of CBI or Omni Bank has
ever been audited by the IRS or any state tax agency for any period since
January 1, 1990. Neither CBI nor Omni Bank is, to the knowledge of CBI, a
party to any threatened action or proceeding by any governmental authority for
assessment or collection of taxes. The reserve for taxes in the financial
statements of CBI for the year ended December 31, 1994, is adequate to cover
all of the tax liabilities of CBI and Omni Bank (including income taxes and
franchise fees) that may become payable in future years in respect to any
transactions consummated prior to December 31, 1994. Neither CBI nor Omni Bank
has and, to the best of CBI's knowledge, will not have any liability for taxes
of any nature for or in respect of the operation of its business or ownership
of its assets from
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December 31, 1994, up to and including the Effective Time, except to the extent
reflected on the Subsequent CBI Financial Statements or otherwise reflected in
the books and records of CBI and Omni Bank for the period following its then
most recent of the Subsequent CBI Financial Statements.
SECTION 4.19 TITLE TO PROPERTIES. Each of CBI and Omni Bank has good
and marketable title to all assets and properties shown in the most recent CBI
Financial Statements, whether real or personal, tangible or intangible, which
it purports to own subject to no liens, mortgages, security interests,
encumbrances or charges of any kind except: (a) as noted in the CBI Financial
Statements or on Schedule 4.19 of the CBI Book of Schedules; (b) statutory
liens for taxes not yet delinquent or being contested in good faith by
appropriate proceedings and for which appropriate reserves have been
established and reflected on the CBI Financial Statements or will be reflected
on the Subsequent CBI Financial Statements; (c) pledges or liens required to be
granted in connection with the acceptance of government deposits, granted in
connection with repurchase or reverse repurchase agreements or otherwise
incurred in the ordinary course of business; and (d) minor defects and
irregularities in title and encumbrances which do not materially impair the use
thereof for the purposes for which they are held and which would not reasonably
be expected to have a material adverse effect on the consolidated financial
condition, assets or business of CBI and Omni Bank. Each of CBI and Omni Bank
as lessee has the right under valid and existing leases to occupy, use, possess
and control any and all of the respective property leased by it.
SECTION 4.20 COMPLIANCE WITH APPLICABLE LAW. Each of CBI and Omni
Bank holds all licenses, certificates, permits, franchises and rights from all
appropriate federal, state or other public authorities necessary for the
conduct of its business and where failure to do so would reasonably be expected
to have a material adverse effect on the consolidated financial condition,
assets or business of CBI and Omni Bank. Each of CBI and Omni Bank has
complied in all material respects with all applicable federal, state and local
statutes, ordinances, regulations, rules or requirements, and neither CBI nor
Omni Bank is presently charged with, or to the knowledge of CBI, under
governmental investigation with respect to, any actual or alleged material
violations of any statute, ordinance, regulation or rule.
SECTION 4.21 COMPLIANCE WITH ERISA. Except as set forth on Schedule
4.21 of the CBI Book of Schedules, all employee benefit plans (as defined in
Section 3(3) of ERISA) established or maintained by CBI or Omni Bank, or to
which CBI or Omni Bank contributes, are in compliance in all material respects
with all applicable requirements of ERISA, and are in compliance in all
material respects with all applicable requirements (including qualification and
non-discrimination requirements in effect as of the Effective Time) of the Code
for obtaining the tax benefits the Code thereupon permits with respect to such
employee benefit plans. For purposes of this Section, non-compliance with the
Code and ERISA is material if such non-compliance would reasonably be expected
to have a material adverse effect on the consolidated financial condition,
assets or business of CBI and Omni Bank. No such employee benefit plan has, or
as of the Effective Time will have, any amount of unfunded benefit liabilities
(as defined in Section 4001(a)(18) of ERISA) for which CBI or Omni Bank would
be liable to any Person under Title IV of ERISA if any such employee benefit
plan were terminated as of the Effective Time, which amounts would be material
to CBI or Omni Bank. Such employee benefit plans are funded in accordance with
Section 412 of the Code (if applicable). There would be no obligations which
would be material to CBI or Omni Bank under Title IV of ERISA relating to any
such employee benefit plan that is a multi-employer plan if any such plan were
terminated or if CBI or Omni Bank withdrew from any such plan as of the
Effective Time.
SECTION 4.22 COMPLIANCE WITH ENVIRONMENTAL LAWS. Each of CBI and
Omni Bank has conducted its respective business in material compliance with all
federal, state, county and municipal environmental laws, including statutes,
regulations, rules, ordinances, orders, restrictions and requirements relating
to underground storage tanks, petroleum products, air pollutants, water
pollutants or process waste water or otherwise relating to the environment or
toxic or hazardous substances or to the manufacture, processing, distribution,
use, recycling, generation, treatment, handling, storage, disposal or transport
of any hazardous or toxic substances or petroleum products (including
polychlorinated biphenyls, whether contained or uncontained, and
asbestos-containing materials, whether friable or not), including the Federal
Solid Waste Disposal Act, the Hazardous and Solid Waste Amendments, the Federal
Clean Air Act, the Federal Clean Water Act, the Occupational Health and Safety
Act, the Federal Resource Conservation and Recovery Act, the Toxic Substances
Control Act, the Federal Comprehensive Environmental Response, Compensation and
Liability Act of 1980 and the Superfund Amendments and Reauthorization Act of
1986, all as amended, and regulations of the Environmental Protection Agency,
the Nuclear Regulatory Agency and any state department of natural resources or
state environmental protection agency now or at any time hereafter in effect
(collectively, the "Environmental Laws"). There are no pending or, to the
knowledge of CBI, threatened actions or
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proceedings by any local municipality, sewerage district or other governmental
entity against CBI or Omni Bank with respect to the Environmental Laws and, to
the knowledge of CBI, there is no basis or grounds for any such action or
proceeding. Except as set forth on Schedule 4.22 of the CBI Book of Schedules,
no environmental clearances or other governmental approvals are required for
the conduct of the business of CBI or Omni Bank or the consummation of the
transactions contemplated hereby. Except as set forth on Schedule 4.22 of the
CBI Book of Schedules, neither CBI nor Omni Bank is the owner of any interest
in real estate on which any substances have been used, stored, deposited,
treated, recycled or disposed of, which substances if known to be present on,
at or under such property, would require clean-up, removal or some other
remedial action under any Environmental Laws.
SECTION 4.23 TRUST POWERS. Neither CBI nor Omni Bank has been
authorized to exercise any trust powers, nor have either CBI or Omni Bank
exercised any trust powers.
SECTION 4.24 BROKERAGE COMMISSIONS. All negotiations relating to
this Agreement and the transactions contemplated herein have been and will be
carried on by CBI directly with Union, its counsel, accountants and other
representatives in such a manner that no actions of CBI or Omni Bank or any of
its respective officers, agents or representatives shall give rise to any claim
against CBI or Union or any of its respective Affiliates for any brokerage
commission, finder's fee, investment advisor's fee or other like payment.
SECTION 4.25 APPROVAL DELAYS. To the best of its knowledge, CBI
knows of no reason why the granting of any of the regulatory approvals referred
to in Section 12.2 would be denied or unduly delayed.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES BY UNION
Union hereby represents and warrants to CBI as follows:
SECTION 5.1 UNION ORGANIZATION. (a) Union: (i) is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware and is a registered bank holding company under the BHCA; (ii) is duly
qualified to do business and is in good standing in each jurisdiction in which
the nature of the business conducted or the properties or assets owned or
leased by it makes such qualification necessary and where failure to be so
qualified would reasonably be expected to have a material adverse effect on the
consolidated financial condition, assets or business of Union and its
Subsidiaries (collectively, the "Union Subsidiaries"); and (iii) has full power
and authority, corporate and otherwise, to own, operate and lease its
properties as presently owned, operated and leased, and to carry on its
business as it is now being conducted.
(b) Acquisition Corp: (i) is a corporation duly organized,
validly existing and in good standing under the laws of the State of Illinois;
(ii) is not engaged in any business; and (iii) has the requisite corporate
power and authority to enter into and perform this Agreement in accordance with
its terms.
SECTION 5.2 UNION CAPITALIZATION. The authorized capital stock of
Union consists, and at the Effective Time will consist, of (i) 2,000,000 shares
of common stock, $1.00 par value per share ("Union Common Stock"), of which as
of the close of business on December 31, 1995, 800,000 shares were outstanding
and 89,421 shares were held in the treasury; and (ii) 200,000 shares of
preferred stock, no par value per share, none of which shares were issued and
outstanding as of the close of business on December 31, 1995. All of the
issued and outstanding shares of capital stock of Union have been duly and
validly authorized and issued and are fully paid and nonassessable. As of the
date of this Agreement, there are no outstanding rights obligating Union or any
Union Subsidiary to purchase, redeem or otherwise acquire, any shares of
capital stock of Union or any Union Subsidiary.
SECTION 5.3 UNION SUBSIDIARIES' ORGANIZATION. Each of the Union
Subsidiaries is duly organized, validly existing and in good standing under the
laws of the state of its incorporation or charter. Each of the Union
Subsidiaries has full power and authority, corporate or otherwise, to carry on
its business as it is now being conducted and to own or hold under lease the
properties and assets it owns or holds under lease.
SECTION 5.4 UNION SUBSIDIARIES' CAPITALIZATION. All of the
outstanding shares of capital stock of each of the Union Subsidiaries have been
duly and validly authorized and issued and are fully paid and nonassessable and
owned by Union or a Union Subsidiary. There are no options, warrants, rights,
calls or commitments of any character relating to any additional shares of the
capital stock of any of the Union Subsidiaries. No capital stock
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or other security issued by any of the Union Subsidiaries has been issued in
violation of, or without compliance with, the rights of stockholders.
SECTION 5.5 AUTHORIZATION. Union and Acquisition Corp each has the
requisite corporate power and authority to enter into and perform its
obligations under this Agreement and the execution, delivery and performance of
this Agreement by Union and Acquisition Corp and the consummation of the
transactions contemplated thereby, have been duly authorized by all necessary
corporate action of both Union and Acquisition Corp. This Agreement
constitutes a legal, valid and binding obligation of Union and Acquisition Corp
enforceable in accordance with its terms, except as such enforcement may be
limited by bankruptcy, insolvency, reorganization or other similar laws and
subject to general principles of equity.
SECTION 5.6 LITIGATION AND REGULATORY MATTERS. As of the date of
this Agreement, there is no action, suit, proceeding, claim or formal written
protest by any Person or agency, or any investigation, report or agreement by
or with any regulatory authority having jurisdiction over Union or any Union
Subsidiary or any of its respective assets or businesses which exists or is
pending or, to Union's knowledge, threatened against Union or any Union
Subsidiary, or any of its respective officers or directors in their capacities
as such, or its assets, business or goodwill which would reasonably be expected
to have a material adverse effect on the consolidated financial condition,
assets or business of Union and the Union Subsidiaries or which would impair
Union's ability to consummate the Merger. Union further represents and
warrants that it does not know or have any reason to believe that there is any
basis for assertion against it or any of the Union Subsidiaries of any material
claims based upon the wrongful action or inaction of either Union or any Union
Subsidiary, and any of its officers, directors or employees which would
reasonably be expected to have a material adverse effect on the consolidated
financial condition, assets or business of Union and the Union Subsidiaries or
which would impair Union's ability to consummate the Merger. Neither Union nor
any Union Subsidiary is subject to, or in default with respect to, nor are any
of its assets subject to, any outstanding judgment, regulatory agreement,
injunction, writ, order or decree or any other requirement of any governmental
body or court or of any governmental agency or instrumentality which would
reasonably be expected to have a material adverse effect on the consolidated
financial condition, assets or business of Union and the Union Subsidiaries.
SECTION 5.7 DEFAULTS UNDER AGREEMENTS. Neither Union nor any Union
Subsidiary is in default or alleged to be in default, under any loan or credit
agreement, conditional sales contract or other title retention agreement or
security agreement relating to money borrowed by Union or any Union Subsidiary,
agreements pursuant to which it leases real or personal property or any other
instrument or obligation, which would reasonably be expected to have a material
adverse effect on the consolidated financial condition, assets or business of
Union and the Union Subsidiaries. Neither Union nor any Union Subsidiary is in
default in any material respect and Union has no knowledge of any material
default under such instruments by any other party thereto and has no knowledge
of any event which with notice or lapse of time or both would constitute a
material default.
SECTION 5.8 FINANCIAL STATEMENTS AND REPORTS. Copies of the
Consolidated Balance Sheets and the related Statements of Income, Statements of
Changes in Stockholders' Equity and Statements of Cash Flows of Union for the
two most recently completed fiscal years (the "Union Financial Statements")
have been delivered to CBI. The Union Financial Statements are complete and
correct in all material respects and fairly present the consolidated financial
position of Union and the Union Subsidiaries at the dates shown and the results
of operations for the periods covered. The Union Financial Statements are
audited statements and have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis. The Union Financial
Statements do not include any material assets or omit to state any material
liabilities, absolute or contingent, or other facts, which inclusion or
omission would render the Union Financial Statements misleading in any material
respect.
SECTION 5.9 DISCLOSURES. No representation or warranty made herein
by Union contains any untrue statement of a material fact, or omits to state a
material fact necessary to make the statements contained herein under the
circumstances under which they were made not misleading and Union has made full
disclosure of all material facts with respect to Union. Except as and to the
extent reflected or reserved against in Union's audited financial statements
for the year ended December 31, 1994, referenced in Section 5.8 above, Union
does, as of the date of this Agreement, not have any liabilities or
obligations, of any nature, secured or unsecured, (whether accrued, absolute,
contingent or otherwise) including any tax liabilities due or to become due,
which would reasonably be expected to have a material adverse effect on the
consolidated financial condition, assets or business of Union and the Union
Subsidiaries.
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SECTION 5.10 EFFECT OF AGREEMENT. The execution, delivery and
performance of this Agreement by Union and Acquisition Corp and the
consummation by each of them of the transactions contemplated hereby do not:
(a) require the consent, waiver, order, registration, qualification, approval,
license or authorization of any Person, court, regulatory authority or other
governmental body, other than as specifically contemplated by this Agreement
and as may be required in connection or in compliance with the provisions of
the Delaware General Corporation Law, the Illinois BCA, the BHCA, the Illinois
BHCA and the Illinois Act; (b) violate, with or without the giving of notice or
the passage of time or both, in any material respect any provision of law
applicable to Union, Acquisition Corp or any of the Union Subsidiaries; (c)
conflict with or result in a breach of any terms of their certificate or
articles of incorporation or bylaws, or any material mortgage, deed of trust,
license, indenture or other agreement or instrument, or any order, judgment,
decree, statute, regulation or other restriction of any kind or character, to
which Union or any Union Subsidiary is a party or by which it or any of its
assets may be bound; (d) give to others any right to accelerate or terminate,
or result in acceleration or termination of, any such agreement or instrument;
(e) result in termination of any provision of any such agreement or instrument;
or (f) result in the creation of any lien, charge or encumbrance upon any of
the property or assets of Union or any Union Subsidiary.
SECTION 5.11 COMPLIANCE WITH APPLICABLE LAW. Each of Union and the
Union Subsidiaries holds all licenses, certificates, permits, franchises and
rights from all appropriate federal, state or other public authorities
necessary for the conduct of its business and where failure to do so would
reasonably be expected to have a material adverse effect on the consolidated
financial condition, assets or business of Union and the Union Subsidiaries.
Each of Union and the Union Subsidiaries has complied in all material respects
with all applicable federal, state and local statutes, ordinances, regulations,
rules or requirements, and neither Union nor any Union Subsidiary is presently
charged with, or to the knowledge of Union, under governmental investigation
with respect to, any actual or alleged material violations of any statute,
ordinance, regulation or rule.
SECTION 5.12 BROKERAGE COMMISSIONS. All negotiations relating to
this Agreement and the transactions contemplated herein and therein have been
and will be carried on by Union directly with CBI, its counsel, accountants and
other representatives in such a manner that no actions of Union or any Union
Subsidiary or any of its respective officers, agents or representatives shall
give rise to any claim against CBI or any of its Affiliates or Subsidiaries for
any brokerage commission, finder's fee, investment advisor's fee or other like
payment.
SECTION 5.13 APPROVAL DELAYS. To the best of its knowledge, Union
knows of no reason why the granting of any of the regulatory approvals referred
to in Section 12.2 would be denied or unduly delayed.
ARTICLE 6
COVENANTS OF CBI
From and after the date hereof and until the Effective Time:
SECTION 6.1 INFORMATION, ACCESS THERETO, CONFIDENTIALITY. Union, its
representatives and agents shall, at all times during normal business hours
prior to the Closing Date, have full and continuing access to the facilities,
operations, records and properties of CBI and Omni Bank in accordance with the
provisions of this Section. Union, its representatives and agents may, prior
to the Closing Date, make or cause to be made such reasonable investigation of
the operations, records and properties of CBI and Omni Bank and of its and
their financial and legal condition as Union shall deem necessary or advisable
to familiarize itself with such records, properties and other matters;
provided, that such access or investigation shall not interfere unnecessarily
with the normal operations of CBI or Omni Bank. Upon request, each of CBI and
Omni Bank will furnish Union or its representatives or agents, its attorneys'
responses to auditors' requests for information, and such financial and
operating data and other information reasonably requested by Union developed by
CBI or Omni Bank, its respective auditors, accountants or attorneys (provided
with respect to attorneys, such disclosure would not result in the waiver by
CBI of any claim of attorney-client privilege), and will permit Union, its
representatives or agents to discuss such information directly with any
individual or firm performing auditing or accounting functions for CBI or Omni
Bank, and such auditors and accountants shall be directed to furnish copies of
any reports or financial information as developed to Union or its
representatives or agents. CBI shall, and shall cause Omni Bank to, give Union
prior notice of each meeting of its board of directors and any committees
thereof, including Omni Bank's loan committee, and a representative of Union
shall be invited to attend each such meeting as an observer, provided, however,
that Union's representative shall not be permitted to observe any portion of
any such meeting during which the Merger or this Agreement is discussed.
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No investigation by Union or attendance by Union's representatives at any board
or committee meeting shall affect the representations, warranties and covenants
made by CBI. This Section shall not require the disclosure of any information
the disclosure of which to Union would be prohibited by law.
SECTION 6.2 CARRY ON IN REGULAR COURSE. Each of CBI and Omni Bank
shall carry on its business diligently and substantially in the same manner as
is presently being conducted and shall not make or institute any material
change from its ordinary course of doing business without the prior written
consent of Union. CBI shall, and shall also cause Omni Bank, unless otherwise
consented to in writing in advance by Union:
(a) Enter into loan transactions only in accordance with past
practices and its loan policy, and in that connection, from the date hereof to
the Effective Time, not: (i) enter into any new credit or new lending
relationships in excess of $100,000 to any Person and such Person's Affiliate;
or (ii) other than incident to a reasonable loan restructuring, extend
additional credit to any Person or such Person's Affiliate if such Person or
such Affiliate is the obligor under any indebtedness to Omni Bank which
constitutes a non-performing loan or against any part of such indebtedness for
which Omni Bank has established loss reserves or any part of which has been
charged-off by Omni Bank, provided, however, that Omni Bank shall be permitted
to make loans in excess of $100,000 without prior approval when each such loan
is: (x) an agricultural operating loan made to a current customer of Omni Bank
who has never been in default on any loan made to him or her by Omni Bank and
who currently has no outstanding balance on any previous agricultural operating
loan made by Omni Bank; and (y) no greater in principal amount than the
principal amount of the immediately preceding year's agricultural operating
loan made to such customer.
(b) Maintain all of its assets necessary for the conduct of its
business in good operating condition and repair, reasonable wear and tear and
damage by fire or unavoidable casualty excepted, and maintain policies of
insurance upon its assets and with respect to the conduct of its business in
amounts and kinds comparable to that in effect on the date hereof and pay all
premiums on such policies when due;
(c) Use its reasonable best efforts to preserve its present
business organization intact, keep available the services of its present
officers and employees and preserve its present relationships with Persons
having business dealings with it, and in connection therewith, permit
representatives of Union:
(i) to participate in meetings or discussions with such
officers and employees of CBI and Omni Bank in
connection with employment opportunities with Union
and the Surviving Corporation after the Effective
Time; and
(ii) after the date of acceptance for filing of the
application filed by Union with the Federal Reserve
requesting prior approval of the Merger, to contact
Persons having dealings with CBI or Omni Bank for the
purpose of informing such Persons of the progress of
the Merger and the services to be offered by Union
and the Surviving Corporation after the Effective
Time;
(d) Maintain its books, accounts and records in the usual, regular
and ordinary manner, on a basis consistent with prior years and comply in all
material respects with all laws and regulations applicable to it and to the
conduct of its business;
(e) Except as provided in Section 6.6, make no amendment to its
articles of incorporation, charter or bylaws and enter into no merger or
consolidation with, or sale of a significant portion of its assets to, any
other Person;
(f) Declare, pay or make no dividend or other distribution or
payment in respect of, or redemption of, shares of CBI Stock;
(g) Make no change in the number of shares of its capital stock
issued and outstanding, grant or make no option, warrant, call, right,
commitment or any other security or agreement of any character obligating it to
issue any shares of its capital stock and issue no other securities or
evidences of indebtedness;
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(h) Make no increase in the compensation payable or to become
payable by it to any employee except for normal periodic increases, and as may
be required, or as is normal and customary based upon past practices over the
last three years, under the terms of any existing Employee Benefit Plan;
(i) Not make any investment of a capital nature exceeding $10,000
or aggregate investments of a capital nature exceeding $25,000;
(j) Except for modifications necessary to comply with any
applicable law, rule or regulation, make no change in any Employee Benefit
Plan;
(k) Cause Omni Bank, consistent with past practice, to maintain a
reserve for possible loan and lease losses which is adequate in all material
respects under the requirements of generally accepted accounting principles to
provide for possible losses, net of recoveries relating to loans previously
charged off, on loans outstanding (including accrued interest receivable);
(l) Make no material change in any existing lease of real or
personal property;
(m) Enter into no new lease or extension of any current lease of
assets having annual rental payments in excess of $10,000 or such leases which
in the aggregate have annual rental payments exceeding $25,000;
(n) Make no principal payment on any outstanding indebtedness of
CBI and make no interest payments on any such indebtedness other than as
expressly required by the terms thereof; and
(o) File in a timely manner all required filings with all proper
regulatory authorities and cause such filings to be true and correct in all
material respects.
With respect to any written request by CBI for Union's consent to any
non-permitted action of CBI or Omni Bank described in this Section, CBI shall
be entitled to conclusively presume Union has consented to any such action
unless CBI shall have received Union's written objection to such action within
five Business Days of the date of Union's receipt of such written request.
SECTION 6.3 SUBSEQUENT CBI FINANCIAL STATEMENTS. As soon as
available after the date hereof, CBI will furnish Union copies of the
Consolidated Balance Sheets and the related Consolidated Statements of Income,
Consolidated Statements of Changes in Shareholders' Equity and Consolidated
Statements of Cash Flow for each annual and quarterly period subsequent to
December 31, 1994, and Call Reports for Omni Bank for each quarterly period
completed after September 30, 1995, and prior to the Effective Time, and all
other financial reports or statements submitted to regulatory authorities after
the date hereof, to the extent permitted by law (collectively, the "Subsequent
CBI Financial Statements"). The Subsequent CBI Financial Statements shall be
prepared on a basis consistent with past accounting practices and shall fairly
present the financial condition and results of operations for the dates and
periods presented. The CBI Financial Statements will not include any material
assets or omit to state any material liabilities, absolute or contingent, or
other facts, which inclusion or omission would render such financial statements
misleading in any material respect.
SECTION 6.4 PROXY STATEMENT; SHAREHOLDERS' MEETING. As soon as
practicable after the execution of this Agreement, but in no event later than
30 days after the date of this Agreement, and at least 30 days prior to the
date of the special meeting of CBI's shareholders (the "Special Meeting"), CBI
shall prepare and mail to each of its shareholders a proxy statement (the
"Proxy Statement") which complies with all rules and regulations applicable to
CBI in connection with the solicitation of proxies for the Special Meeting.
None of the information concerning CBI or Omni Bank which is included in the
Proxy Statement when mailed shall be false or misleading with respect to any
material fact, or omit to state any material fact necessary in order to make
the statements therein not misleading or, at the time of the Special Meeting,
be false or misleading with respect to any material fact, or omit to state any
material fact necessary to correct any statement in any earlier communication
with respect to the solicitation of any proxy for the Special Meeting. There
shall be included with the Proxy Statement a notice of the Special Meeting as
required by the Illinois BCA, a copy of this Agreement and a copy of Section
11.70 of the Illinois BCA governing the rights of dissenting shareholders. The
Proxy Statement shall be reasonably acceptable to Union. In advance of mailing
the Proxy Statement, or any amendment or supplement thereto, to its
shareholders, CBI shall provide Union and its counsel with a copy of the Proxy
Statement or such amendment or supplement and an opportunity to
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comment thereon. The Special Meeting shall be held at the earliest practicable
date, but in no event later than 60 days after the date of this Agreement. CBI
shall recommend to its shareholders the approval of this Agreement and the
Merger and shall solicit proxies voting in favor thereof from its shareholders.
SECTION 6.5 ADVICE OF CHANGES. Between the date hereof and the
Closing Date, CBI shall promptly advise Union in writing of any fact which, if
existing or known at the date hereof, would have been required to be set forth
or disclosed in or pursuant to this Agreement or of any fact which, if existing
or known at the date hereof, would have made any of the representations
contained herein materially untrue, provided, however, that receipt of notice
of such facts after the date of this Agreement shall have no effect on the
truth and accuracy of the representations and warranties made in this Agreement
as of the date hereof.
SECTION 6.6 OTHER OFFERS. None of CBI, Omni Bank or any Affiliate of
CBI or any of its respective directors, officers, employees, representatives or
agents, shall, directly or indirectly, make, encourage, facilitate, solicit,
assist or initiate any inquiry or proposal, or participate in any negotiations
with, or provide any information to, any corporation, partnership, agent,
attorney, financial advisor, Person or other entity or group (other than Union,
Acquisition Corp, an Affiliate of Union or Acquisition Corp or an officer,
employee or other authorized representative of Union, Acquisition Corp or such
Affiliate, or CBI's counsel and financial advisor, solely for use in connection
with the transactions contemplated hereby) relating to any: (a) liquidation,
dissolution, recapitalization, merger or consolidation of CBI or Omni Bank; (b)
sale outside the ordinary course of business of a significant amount of assets
of CBI or Omni Bank; (c) purchase or sale of shares of capital stock of CBI or
Omni Bank; or (d) any similar transactions involving CBI or Omni Bank, other
than the transactions contemplated by this Agreement, provided, however, that
CBI may provide information at the request of a third party if the board of
directors of CBI determines, in good faith, that the exercise of its fiduciary
duties to CBI's stockholders under applicable law, as advised in writing by
outside counsel reasonably acceptable to Union, requires it to take such
action, and, provided further, that CBI may not, in any event, provide to such
third party any information which it has not provided to Union. Upon execution
of this Agreement, CBI shall immediately cease and cause to be terminated any
and all such current contacts and negotiations with respect to any such
transaction. CBI shall immediately inform Union of any inquiry, proposal or
request for information (including the terms thereof and the Person making such
inquiry) which it may receive in respect of such a transaction.
SECTION 6.7 ACCOUNTING AND OTHER ADJUSTMENTS. CBI agrees that it
shall, and shall cause Omni Bank, to: (a) make any accounting adjustments or
entries to its books of account and other financial records; (b) make
additional provisions to any allowance for loan and lease losses; (c) sell or
transfer any investment securities held by it; (d) charge-off any loan or
lease; (e) create any new reserve account or make additional provisions to any
other existing reserve account; (f) make changes in any accounting method; (g)
accelerate, defer or accrue any anticipated obligation, expense or income item;
and (h) make any other adjustments which would affect the financial reporting
of Union, on a consolidated basis after the Closing, in any case as Union shall
request, provided, however, that the calculation of the Cash Price Per Share
shall not be affected by any of the actions described in this Section, except
for any such actions that CBI would have been obligated to take by any other
provision of this Agreement, and provided further, that neither CBI nor Omni
Bank shall be obligated to take any such requested action until immediately
prior to the Closing and at such time as CBI shall have received reasonable
assurances that all conditions precedent to CBI's obligations under this
Agreement (except for the completion of actions to be taken at the Closing)
have been satisfied.
SECTION 6.8 INFORMATION PROVIDED TO UNION. CBI agrees that none of
the information concerning CBI or Omni Bank which is provided or to be provided
by CBI or Omni Bank to Union for inclusion or which is included in any
documents to be filed with any governmental authority in connection with the
transactions contemplated by this Agreement will, at the respective times such
documents are filed, be false or misleading with respect to any material fact
or omit to state any material fact necessary in order to make the statements
therein not misleading.
SECTION 6.9 CBI CLOSING OBLIGATIONS. CBI agrees to take such actions
as may be necessary to ensure that the following conditions (collectively, the
"CBI Closing Obligations") are satisfied prior to, or concurrently with, the
Closing: (a) CBI shall have no outstanding liabilities, including long-term or
short-term debt; and (b) CBI shall have no outstanding subordinated debentures.
Union agrees to assist CBI in satisfying such conditions through payment of all
or a portion of the Aggregate Amount to third parties, as directed in writing
by CBI, and any such payments by Union shall reduce the Cash Price Per Share as
set forth in Section 3.2.
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SECTION 6.10 ENVIRONMENTAL MATTERS. Union may in its discretion,
prior to the Closing, retain at its own expense an independent professional
consultant to perform an environmental site assessment and render to Union a
report (an "Environmental Report") to determine if any real property in which
CBI or Omni Bank holds any interest contains or gives evidence that any
violations of Environmental Laws have occurred on any such property. Neither
Union nor its independent professional consultant shall enter upon any such
real property in which CBI or Omni Bank holds only a mortgagee's interest
without the prior permission of CBI and the Person in possession thereof. CBI
shall not withhold such permission unreasonably, and shall use all reasonable
efforts to obtain such permission for Union from the Person in possession of
any such mortgaged real property for which Union desires its independent
professional consultant to conduct a site assessment. Union shall have no duty
to act upon any information produced by such reviews or investigations with or
for the benefit of CBI, Omni Bank or any other Person, but shall provide such
information to CBI as soon as practicable after such information becomes
available to Union.
SECTION 6.11 ADDITIONAL UNION ACQUISITIONS. CBI acknowledges that
Union is currently in negotiations with respect to other possible acquisitions
and business combinations, and notwithstanding anything contained herein to the
contrary, CBI agrees that nothing contained herein is intended to or shall
prevent Union from continuing such negotiations, commencing any other similar
negotiations or taking any such actions that may be necessary to consummate any
such other acquisitions or business combinations so long as the same do not
prevent Union from consummating the Merger.
ARTICLE 7
COVENANTS OF UNION
Union hereby covenants and agrees with CBI as follows:
SECTION 7.1 CONFIDENTIALITY. Any confidential information or trade
secrets received by Union, Acquisition Corp, their employees or agents in the
course of the examination described in Section 6.1 shall be treated
confidentially, and any correspondence, memoranda, records, copies, documents
and electronic or other media of any kind containing either such confidential
information, or trade secrets or both shall be destroyed by Union or, at CBI's
request, returned to CBI in the event this Agreement is terminated as provided
in Section 13.1. Such information shall not be used by Union, Acquisition Corp
or its agents to the detriment of CBI or Omni Bank.
SECTION 7.2 CONDUCT OF BUSINESS; CERTAIN COVENANTS. From and after
the execution and delivery of this Agreement and until the Effective Time,
Union will:
(a) conduct its business and operate only in accordance with sound
banking and business practices; and
(b) remain in good standing and file all required reports with all
applicable regulatory authorities.
SECTION 7.3 ADVICE OF CHANGES. Between the date hereof and the
Closing Date, Union shall promptly advise CBI in writing of any fact which, if
existing or known at the date hereof, would have been required to be set forth
or disclosed in or pursuant to this Agreement or of any fact which, if existing
or known at the date hereof, would have made any of the representations
contained herein materially untrue, provided, however, that receipt of notice
of such facts after the date of this Agreement shall have no effect on the
truth and accuracy of the representations and warranties made in this Agreement
as of the date hereof.
SECTION 7.4 PURCHASE OF CBI ASSETS. On or prior to the Closing,
Union agrees to permit CBI's President to purchase from CBI or Omni Bank any of
the assets listed on Schedule 7.4 for cash at a price not less than the book
value of such asset as shown on the books and records of CBI or Omni Bank as of
the date of such purchase, provided, however, that any policies of life
insurance shall be purchased at not less than their respective cash surrender
values as of the date of purchase.
SECTION 7.5 INFORMATION PROVIDED TO CBI. Union agrees that none of
the information concerning Union or any Union Subsidiary which is included in
the Proxy Statement and any other documents to be filed with any governmental
authority in connection with the transactions contemplated by this Agreement
will, at the respective times such documents are filed and, in the case of the
Proxy Statement, when mailed, be false or misleading with
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respect to any material fact, or omit to state any material fact necessary in
order to make the statements therein not misleading or, in the case of the
Proxy Statement, or any amendment thereof or supplement thereto, at the time of
the Special Meeting be false or misleading with respect to any material fact,
or omit to state any material fact necessary to correct any statement in any
earlier communication with respect to the solicitation of any proxy for the
meeting in connection with which the Proxy Statement shall be mailed.
Notwithstanding the foregoing, Union shall have no responsibility for the truth
or accuracy of any information with respect to CBI or Omni Bank or any of their
affiliates or associates contained in the Proxy Statement.
ARTICLE 8
CONDITIONS PRECEDENT TO OBLIGATIONS
OF UNION AND ACQUISITION CORP
The obligations of Union and Acquisition Corp under this Agreement are
subject, unless waived by Union or Acquisition Corp, to the satisfaction of the
following conditions on or prior to the Effective Time:
SECTION 8.1 REPRESENTATIONS AND WARRANTIES TRUE AT EFFECTIVE TIME.
The representations and warranties made by CBI in this Agreement shall be true
and correct on and as of the Effective Time with the same effect as though such
representations and warranties had been made or given on and as of the
Effective Time, except for changes contemplated by this Agreement, and except
also for representations and warranties as of a specified time other than the
Effective Time, which shall be true and correct at such specified time. CBI
shall have delivered to Union a certificate of its President or any Vice
President to the same effect.
SECTION 8.2 COMPLIANCE WITH AGREEMENT. CBI shall have performed and
complied with all of its obligations under this Agreement which are to be
performed or complied with prior to or at the Effective Time and CBI shall have
delivered to Union a certificate of its President or any Vice President to the
same effect.
SECTION 8.3 PROCEEDINGS AND DOCUMENTS SATISFACTORY. All proceedings,
corporate or other, to be taken by CBI in connection with the transactions
contemplated by this Agreement, and all documents incident thereto, shall be
reasonably satisfactory in form and substance to counsel for Union, and CBI
shall have made available to Union for examination the originals or true and
correct copies of all records and documents relating to the business and
affairs of CBI which Union may reasonably request in connection with said
transactions.
SECTION 8.4 STATUTORY REQUIREMENTS. This Agreement shall have been
duly and validly approved by the board of directors and the shareholders of
CBI. Such shareholder approval shall have been obtained in conformity with all
applicable laws at a meeting of shareholders for which proxies are solicited in
compliance with applicable laws and requirements.
SECTION 8.5 REGULATORY APPROVALS. Union shall have received any and
all required approvals from the Federal Reserve, the Commissioner and any other
necessary governmental authority, for the consummation of the transactions
contemplated hereby, and all applicable waiting periods shall have expired.
SECTION 8.6 LITIGATION. Since the date of this Agreement, neither
CBI nor Omni Bank shall be made a party to, or to the knowledge of CBI
threatened by, any actions, suits, proceedings, litigation or legal proceedings
which, in the reasonable opinion of Union, have or are likely to have a
material adverse effect on the consolidated financial condition, assets or
business of CBI and Omni Bank, neither CBI nor Omni Bank shall be subject to or
threatened with an agreement with any regulatory authority and no action, suit,
proceeding or claim shall have been instituted, made or threatened by any
Person relating to the Merger or the validity or propriety of the transactions
contemplated by this Agreement.
SECTION 8.7 ACCURACY OF FINANCIAL STATEMENTS. The CBI Financial
Statements and the Subsequent CBI Financial Statements, previously or
subsequently furnished to Union by CBI shall not be inaccurate in any material
respect, unless the effect of any such inaccuracy on the amount of CBI's
shareholders' equity has already been taken into account through a reduction in
the Aggregate Amount pursuant to Section 3.2.
SECTION 8.8 ABSENCE OF CERTAIN CHANGES OR EVENTS; SHAREHOLDERS'
EQUITY. From the date hereof to the Effective Time, there shall be and have
been no material adverse change in the consolidated financial condition,
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assets or business of CBI and Omni Bank. In addition, the shareholders' equity
of CBI computed in accordance with generally accepted accounting principles
(but not including any additions or reductions as a result of the application
of FASB 115) as of the time immediately prior to the Closing shall not be less
than CBI's shareholders' equity as of September 30, 1995.
SECTION 8.9 CONSENTS AND APPROVALS. Any consents or approvals
required to be secured by CBI by the terms of this Agreement shall have been
obtained and shall be satisfactory to Union.
SECTION 8.10 TERMINATION OF EMPLOYEE BENEFITS PLANS. Upon Union's
written request delivered to CBI on or prior to the Closing Date, CBI shall
take all steps necessary to terminate or freeze the benefits payable or
accruing following the Closing under any Employee Benefit Plan, all on terms
reasonably acceptable to Union.
SECTION 8.11 CBI COMMON STOCK VOTING AGREEMENTS. Concurrently with
the execution of this Agreement, each of the holders of greater than 10% of the
issued and outstanding shares of CBI Common Stock and each of the directors of
CBI shall have executed and delivered to Union a written agreement in the form
attached as Exhibit G pursuant to which such shareholder and such director
agrees to vote his or her shares of CBI Common Stock to approve this Agreement
and the Merger.
SECTION 8.12 CBI PREFERRED STOCK VOTING AGREEMENTS. Within 20 days
of the date of this Agreement, CBI shall deliver to Union a written agreement
substantially in the form attached as Exhibit G executed by holders of greater
than two thirds of the issued and outstanding shares of CBI Preferred Stock
pursuant to which such shareholder agrees to vote his or her shares of CBI
Preferred Stock to approve this Agreement and the Merger.
SECTION 8.13 LOAN LOSS RESERVE. At the Effective Time, the reserve
for possible loan and lease losses of Omni Bank shall be adequate in all
material respects under the requirements of generally accepted accounting
principles to provide for possible losses, net of recoveries relating to loans
previously charged off, on loans outstanding (including accrued interest
receivable) as of immediately prior to the Effective Time, and such reserves
shall in no event be less than that shown on the September 30, 1995 Call Report
of Omni Bank.
SECTION 8.14 ENVIRONMENTAL MATTERS. Union shall have been granted
acceptable access to any real property in which CBI or Omni Bank owns any
interest and for which Union desired its independent professional consultant to
prepare an Environmental Report, and the results of any Environmental Report
rendered to Union with respect to such real property shall have not disclosed
any material violation of any of the Environmental Laws.
SECTION 8.15 SALE OF CERTAIN ASSETS AND LOANS. On or prior to the
Closing, CBI shall sell, or cause Omni Bank to sell, to either or both of Mr.
Ivan Wharton and Mrs. Betty Wharton the loans and other assets of CBI or Omni
Bank that are listed on Schedule 8.15 (including the real property owned by CBI
or Omni Bank which is located in Paloma, Illinois), provided, however, that
each such sale shall be non-recourse and for cash at a price not less than the
book value of such asset or loan as shown on the books and records of CBI or
Omni Bank as of the date of such sale. If prior to the Closing, Omni Bank
recovers an aggregate net amount with respect to any loan listed on Schedule
8.15 which is in excess of the book value of such loan as shown on the books
and records of Omni Bank as of the date immediately prior to such recovery,
Union agrees that the amount in excess of such book value shall be added to,
and shall increase, the Aggregate Amount.
ARTICLE 9
CONDITIONS PRECEDENT TO THE
OBLIGATIONS OF CBI
The obligations of CBI under this Agreement are subject, unless waived
by CBI, to the satisfaction on or prior to the Effective Time of the following
conditions:
SECTION 9.1 REPRESENTATIONS AND WARRANTIES TRUE AT EFFECTIVE TIME.
The representations and warranties made by Union and Acquisition Corp in this
Agreement shall be true and correct on and as of the Effective Time with the
same effect as though such representations and warranties had been made or
given on and as of the Effective Time, except for changes contemplated by this
Agreement, and except also for representations and warranties as of
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a specified time other than the Effective Time, which shall be true and correct
at such specified time. Union shall have delivered to CBI a certificate from
its President or any Vice President to the same effect.
SECTION 9.2 COMPLIANCE WITH AGREEMENT. Union and Acquisition Corp
shall have performed and complied in all material respects with all of their
obligations under this Agreement which are to be performed or complied with by
them prior to or on the Effective Time and Union shall have delivered to CBI a
certificate from its President or any Vice President to the same effect.
SECTION 9.3 PROCEEDINGS AND DOCUMENTS SATISFACTORY. All proceedings,
corporate or other, to be taken by Union and Acquisition Corp in connection
with the transactions contemplated by this Agreement, and all documents
incident thereto, shall be reasonably satisfactory in form and substance to
counsel for CBI, and Union and Acquisition Corp shall have made available to
CBI and its representatives for examination the originals or true and correct
copies of all records and documents relating to the business and affairs of
Union and Acquisition Corp which CBI or its counsel may reasonably request in
connection with said transactions.
SECTION 9.4 STATUTORY REQUIREMENTS. This Agreement shall have been
duly and validly approved by the boards of directors of Union and Acquisition
Corp and by the vote of the sole shareholder of Acquisition Corp.
SECTION 9.5 CBI SHAREHOLDER APPROVAL. This Agreement shall have been
approved and adopted by the shareholders of CBI in accordance with the Illinois
BCA.
SECTION 9.6 REGULATORY APPROVALS. Union shall have received any and
all required approvals from the Federal Reserve, the Commissioner and any other
necessary governmental authority, for the consummation of the transactions
contemplated hereby.
SECTION 9.7 CONSENTS AND APPROVALS. Any consents or approvals
required to be secured by either party by the terms of this Agreement or
otherwise reasonably necessary in the opinion of CBI to consummate the
transactions contemplated by this Agreement shall have been obtained and shall
be reasonably satisfactory to CBI.
SECTION 9.8 ACCURACY OF FINANCIAL STATEMENTS. The Union Financial
Statements furnished to CBI by Union shall not be inaccurate in any material
respect.
SECTION 9.9 ABSENCE OF CERTAIN CHANGES OR EVENTS. From the date
hereof to the Effective Time, there shall be and have been no material adverse
change in the consolidated financial condition, assets or business of Union and
the Union Subsidiaries.
SECTION 9.10 LITIGATION. No action, suit, proceeding or claim shall
have been instituted, made or threatened by any Person relating to the Merger
or the validity or propriety of the transactions contemplated by this
Agreement.
ARTICLE 10
CONDITIONS PRECEDENT TO OBLIGATIONS
OF EACH OF THE PARTIES
In addition to the provisions of Sections 8 and 9, the obligations of
each of the parties under this Agreement are subject, unless waived by the
other parties hereto, to the satisfaction on or prior to the Effective Time of
the following conditions:
SECTION 10.1 OTHER APPROVALS. All actions, consents or approvals,
governmental or otherwise, which are, or in the opinion of counsel for Union or
CBI may be, necessary to permit or enable the Surviving Corporation upon and
after the Merger, to conduct all or any part of the business of CBI, in the
manner in which such activities and businesses are conducted up to the
Effective Time, shall have been obtained without any conditions which in the
reasonable opinion of Union are materially adverse, and shall not have been
withdrawn or stayed.
SECTION 10.2 ORDERS, DECREES AND JUDGMENTS. Consummation of the
transactions contemplated by this Agreement shall not violate any order, decree
or judgment of any court or governmental body having competent jurisdiction.
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ARTICLE 11
ADDITIONAL COVENANTS OF THE PARTIES
SECTION 11.1 COOPERATION. Each of CBI, Acquisition Corp and Union,
will, and each of the foregoing will cause its respective Subsidiaries to,
fully and promptly cooperate with each of CBI and Union and their respective
counsel and accountants in connection with any steps to be taken as part of
their obligations under this Agreement.
SECTION 11.2 EXPENSES. Except as otherwise provided herein, all
costs and expenses incurred by a party hereto shall be borne by such party,
including the fees of their respective accountants and attorneys.
SECTION 11.3 PUBLICITY. Prior to the Effective Time, the parties
hereto will consult with each other before issuing any press releases or
otherwise making any public statements with respect to this Agreement or the
transactions contemplated hereby and shall not issue any such press release or
make any such public statement without the prior consent of the other parties,
except as may be required by law.
ARTICLE 12
REGULATORY APPROVALS
SECTION 12.1 INITIAL FILINGS. Union shall use its best efforts to
make as soon as practicable all appropriate initial filings necessary to obtain
the regulatory approvals referred to in Section 12.2 at such time as it
reasonably believes that such filings would be accepted and approved by the
appropriate regulatory agencies. Union shall in good faith pursue the
regulatory approvals necessary to consummate the transactions contemplated in
this Agreement. Union shall provide CBI and its counsel with a copy of each
application or document filed by it with federal or state regulatory officials
to obtain such approvals.
SECTION 12.2 NECESSARY APPROVALS. Union shall have primary
responsibility for preparation of all applications for regulatory approval of
the transactions contemplated in this Agreement, including the preparation of
an application or any amendment thereto or any other required statements or
documents filed or to be filed by any party with: (a) the Federal Reserve
pursuant to the BHCA; (b) the Commissioner pursuant to the Illinois BHCA and
the Illinois Act; or (c) any other party or governmental authority pursuant to
any applicable law or regulation, for authority to consummate the transactions
contemplated by this Agreement. CBI agrees to cooperate with Union and use its
reasonable best efforts to assist Union in preparing such applications and in
pursuit of such approvals.
ARTICLE 13
TERMINATION AND ABANDONMENT
SECTION 13.1 REASONS FOR TERMINATION AND ABANDONMENT. This Agreement
may be terminated and abandoned upon prompt written notice to the other party
or parties before the Effective Time, notwithstanding authorization and
adoption of this Agreement by the shareholders of CBI or Acquisition Corp or
both:
(a) By mutual consent of the boards of directors of Union and
Acquisition Corp and the board of directors of CBI;
(b) By Union or Acquisition Corp at any time after December 31,
1996, or such later date as shall have been agreed to in writing by the parties
(the "Termination Date"), if any of the conditions provided for in Sections 8
and 10 of this Agreement have not been met and have not been waived in writing
by Union, provided, however, that if any condition set forth in Sections 8 or
10 is required to be satisfied prior to the Termination Date, Union may
terminate this Agreement if such condition has not been satisfied within 30
days following receipt by CBI of notice of such failed condition;
(c) By Union if CBI shall have breached one or more provisions of
this Agreement in any way which has, or would reasonably be expected to have a
material adverse effect on the rights of Union under this Agreement,
considering all such breaches in the aggregate, and where such breach has not
been cured within 30 days following receipt by CBI of notice of such breach;
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(d) By CBI at any time after the Termination Date if any of the
conditions provided for in Sections 9 or 10 of this Agreement have not been met
and have not been waived in writing by CBI, provided, however, that if any
condition set forth in Sections 9 or 10 is required to be satisfied prior to
the Termination Date, CBI may terminate this Agreement if such condition has
not been satisfied within 30 days following receipt by Union of notice of such
failed condition;
(e) By CBI if either Union or Acquisition Corp shall have breached
one or more provisions of this Agreement in any way which has, or would
reasonably be expected to have a material adverse effect on the rights of CBI
under this Agreement, considering all such breaches in the aggregate, and where
such breach has not been cured within 30 days following receipt by Union of
notice of such breach;
(f) By CBI or Union if CBI's shareholders fail to approve this
Agreement at the Special Meeting as contemplated by Section 6.4.
SECTION 13.2 EFFECT OF TERMINATION OR ABANDONMENT. Except where a
party has breached its covenants under this Agreement or as otherwise expressly
provided herein, in the event of the termination of this Agreement and the
abandonment of the Merger pursuant to Sections 1.3, 3.2 or 13.1, this Agreement
shall become null and void and there shall be no liability or restrictions on
the future activities on the part of any party hereto, or its directors,
officers or shareholders, except for Union's and Acquisition Corp's
obligations, and CBI's obligation, concerning confidentiality referred to in
Section 7.1 and Section 6.1, respectively.
SECTION 13.3 PAYMENT TO CBI. If the Merger contemplated herein is
not consummated because Union breaches its obligations under this Agreement,
unless such breach or failure is a result of the failure by CBI to perform and
comply in all material respects with any of its material obligations under this
Agreement which are to be performed or complied with by it prior to or on the
date required hereunder, then Union shall pay to CBI, upon its written demand,
an amount equal to CBI's costs and expenses incurred in connection with this
Agreement, provided, however, that such amount shall in no event be greater
than $100,000. Such sum shall constitute liquidated damages and the receipt
thereof shall be CBI's sole and exclusive remedy under this Agreement for such
breach by Union.
SECTION 13.4 PAYMENTS TO UNION. (a) If the Merger contemplated
herein is not consummated because CBI breaches its obligations under this
Agreement or the shareholders of CBI fail to approve this Agreement and the
Merger, unless such breach or failure is a result of the failure by Union or
Acquisition Corp to perform and comply in all material respects with any of
their material obligations under this Agreement which are to be performed or
complied with by them prior to or on the date required hereunder, then CBI
shall pay to Union, upon its written demand, an amount equal to Union's costs
and expenses incurred in connection with this Agreement, provided, however,
that such amount shall in no event be greater than $100,000. Such sum,
together with any payment which may be due pursuant to Section 13.4(b), shall
constitute liquidated damages and the receipt thereof shall be Union's sole and
exclusive remedy under this Agreement for such breach by CBI or such failure by
CBI's shareholders to approve this Agreement and the Merger.
(b) In addition to any payment due pursuant to Section 13.4(a), if
the Merger contemplated herein is not consummated because CBI breaches its
obligations under this Agreement or the shareholders fail to approve this
Agreement and the Merger, unless such breach or failure is a result of the
failure by Union or Acquisition Corp to perform and comply in all material
respects with any of their material obligations under this Agreement which are
to be performed or complied with by them prior to or on the date required
hereunder, and within one year after the termination of this Agreement CBI
enters into an agreement with any party other than Union providing for the
acquisition of control of CBI by such other party and the transaction
contemplated by such agreement is consummated at any time thereafter, then CBI
shall pay to Union, upon its written demand, the sum of $250,000. Such sum,
together with any payment which may be due pursuant to Section 13.4(a), shall
constitute liquidated damages under this Agreement and the receipt thereof
shall be Union's sole and exclusive remedy under this Agreement for such breach
by CBI, such failure by CBI's shareholders to approve this Agreement and the
Merger or as a result of such acquisition of control of CBI by a third party,
provided, further, however, that the provisions of this Section shall in no way
limit Union's rights against any such third party. For purposes of this
Section, the phrase "control of CBI" shall mean the acquisition by any such
third party of: (a) legal or beneficial ownership (as defined by Rule 13d-3
promulgated under the Securities Exchange Act of 1934, as amended) of greater
than 33% of the then issued and outstanding voting stock of CBI or Omni Bank
through any transaction to which CBI or any
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Affiliate of CBI is a party; (b) all or substantially all of CBI's assets; or
(c) any of the capital stock or all or substantially all of the assets of Omni
Bank.
ARTICLE 14
MISCELLANEOUS
SECTION 14.1 GOVERNING LAW. All questions concerning the
construction, validity and interpretation of this Agreement, and the
performance of the obligations imposed by this Agreement shall be governed by
the internal laws of the State of Illinois applicable to contracts made and
wholly to be performed in such state without regard to conflicts of laws.
SECTION 14.2 ASSIGNMENT. Neither this Agreement nor any of the
rights or obligations hereunder may be assigned, in whole or in part, by any of
the parties hereto without the prior written consent of the other parties
hereto and any purported assignment in violation hereof shall be void and of no
effect.
SECTION 14.3 AMENDMENT AND MODIFICATION. The parties may by written
agreement signed by all parties hereto: (a) extend the time for the performance
of any of the obligations or other acts of the parties hereto; (b) waive any
inaccuracies in the representations or warranties contained in this Agreement
or in any document delivered pursuant to this Agreement; and (c) waive
compliance with or modify, amend or supplement any of the conditions,
covenants, agreements, representations or warranties contained in this
Agreement or waive or modify performance of any of the obligations of any of
the parties hereto, which are for the benefit of the waiving party, provided,
however, that no such modification, amendment or supplement agreed to after
authorization of this Agreement by the shareholders of CBI shall affect the
rights of such shareholders in any manner which is materially adverse to such
shareholders. The failure of any party hereto to enforce at any time any
provision of this Agreement shall not be construed to be a waiver of such
provision, nor in any way affect the validity of this Agreement or any part
hereof or the right of any party thereafter to enforce each and every such
provision. No waiver of any breach of this Agreement shall be held to
constitute a waiver of any other or subsequent breach.
SECTION 14.4 NOTICES. All notices, requests and other communications
hereunder shall be in writing (which shall include telecopier communication)
and shall be deemed to have been duly given if delivered by hand or by
overnight express delivery service, mailed with first class postage prepaid or
telecopied if confirmed immediately thereafter by also mailing a copy of any
notice, request or other communication by mail with first class postage
prepaid:
(a) If to CBI to:
Country Bancshares, Inc.
R.R. #2, Box 205C
Camp Point, Illinois 62320
Attention: Mr. Ivan E. Wharton, President, and
Mrs. Betty Wharton
Telephone: (309) 837-6664
Telecopier: (309) 836-1410
with copies to:
Gerrish & McCreary, P.C.
Suite 200, 700 Colonial Road
P. O. Box 242120
Memphis, Tennessee 38124-2120
Attention: P. Thomas Parrish, Esq.
Telephone: (901) 767-0900
Telecopier: (901) 684-2339
or to such other Person and place as CBI shall furnish to Union in writing; or
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(b) if to Union or Acquisition Corp to:
UnionBancorp, Inc.
122 W. Madison Street
Ottawa, Illinois 61350
Attention: Mr. R. Scott Grigsby
Chairman of the Board and President
Telephone: (815) 433-7010
Telecopier: (815) 434-3160
with copies to:
Barack, Ferrazzano, Kirschbaum & Perlman
333 West Wacker
Suite 2700
Chicago, Illinois 60606
Attention: John E. Freechack, Esq.
Telephone: (312) 984-3100
Telecopier: (312) 984-3150
or to such other Person or place as Union or Acquisition Corp shall furnish to
CBI or CBI shall furnish to Union and Acquisition Corp in writing. Except as
otherwise provided herein, all such notices, requests or other communications
shall be effective: (i) if delivered by hand, when delivered; (ii) if mailed in
the manner provided in this Section, five Business Days after deposit with the
United States Postal Service; (iii) if delivered by overnight express delivery
service, on the next Business Day after deposit with such service; (iv) if by
telecopier, on the next Business Day if also confirmed by mail in the manner
provided in this Section.
SECTION 14.5 HEADINGS. The table of contents and the captions and
headings of articles, sections, schedules and exhibits appearing in or attached
to this Agreement have been inserted solely for convenience of reference and
shall not be considered a part of this Agreement nor shall any of them affect
the meaning or interpretation of this Agreement or any of its provisions.
SECTION 14.6 ENTIRE AGREEMENT. This Agreement and any documents
executed by the parties pursuant to this Agreement and referred to herein
constitute the entire understanding and agreement of the parties hereto and
supersede all other prior agreements and understandings, written or oral,
relating to such subject matter between the parties. This Agreement and every
representation, warranty, covenant, agreement and provision hereof shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns.
SECTION 14.7 SEVERABILITY. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement is held to be
prohibited by or invalid under applicable law, such provision will be
ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of
this Agreement unless the consummation of the transactions contemplated hereby
is adversely affected thereby.
SECTION 14.8 FURTHER INSTRUMENTS. The parties hereto will, at or
before the Effective Time, execute and deliver such further instruments as may
be reasonably requested by any other party which are necessary to or
appropriate with respect to the consummation of the transactions contemplated
by this Agreement.
SECTION 14.9 COUNTERPARTS. This Agreement and any amendments thereto
may be executed in any number of counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.
SECTION 14.10 BEST EFFORTS. Each party represents and warrants that
it will use its best efforts to bring about the transactions contemplated by
this Agreement as soon as practicable provided that this Section shall not
obligate CBI or Union to remedy any breach of any of its representations,
warranties and covenants herein. In the event that any party becomes aware of
the occurrence or impending occurrence of any event which would constitute or
cause a breach by it of any of the representations or warranties herein, or
would have constituted or caused a
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breach by it of any of the representations or warranties herein, had such an
event occurred or been known prior to the date hereof, said party shall
immediately give detailed and written notice thereof to the other party.
SECTION 14.11 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. Except as
otherwise expressly provided herein and in the Indemnity Agreement, the
covenants, representations and warranties contained in this Agreement shall
survive only until the Effective Time.
SECTION 14.12 NO THIRD PARTY BENEFICIARIES. This Agreement is not
intended to and shall not create any rights in or confer any benefits upon any
Person or entity other than the parties hereto.
[THIS SPACE LEFT INTENTIONALLY BLANK]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective officers as of the day and year first written
above.
ATTEST: UNIONBANCORP, INC.
By: /s/ Charles J. Grako By: /s/ R. Scott Grigsby
----------------------------------- -------------------------------------------
Charles J. Grako R. Scott Grigsby
Secretary/Treasurer Chairman of the Board and President
ATTEST: COUNTRY BANCSHARES, INC.
By: /s/ Michel McLennan By: /s/ Betty F. Wharton
----------------------------------- -------------------------------------------
Michel McLennan Betty F. Wharton
Secretary Chairman of the Board
ATTEST: COUNTRY BANCSHARES, INC.
By: /s/ Michel McLennan By: /s/ Ivan E. Wharton
----------------------------------- -------------------------------------------
Michel McLennan Ivan E. Wharton
Secretary President
ATTEST: CBI ACQUISITION CORPORATION
By: /s/ Charles J. Grako By: /s/ R. Scott Grigsby
----------------------------------- -------------------------------------------
Charles J. Grako R. Scott Grigsby
Secretary/Treasurer President
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