Exhibit 10 (a)
APPENDIX I
Exhibit 10 (a)
APPENDIX I
AGREEMENT AND PLAN OF REORGANIZATION AND MERGER
DATED MARCH 4, 1998,
AMENDED AS OF AUGUST 7, 1998
AMENDMENT NO. 1 TO
AGREEMENT AND PLAN OF REORGANIZATION AND MERGER
BY AND AMONG
UNITED FEDERAL SAVINGS BANK,
TRIANGLE BANK
AND
TRIANGLE BANCORP, INC.
THIS AMENDMENT NO. 1 TO AGREEMENT AND PLAN OF REORGANIZATION AND MERGER
(hereinafter called "Agreement") entered into as of the 7th day of August, 1998,
by and among UNITED FEDERAL SAVINGS BANK ("United Federal"), TRIANGLE BANK
("Triangle") and TRIANGLE BANCORP, INC. (the "Holding Company").
WHEREAS, United Federal, Triangle and the Holding Company are parties
to an Agreement and Plan of Reorganization and Merger dated March 4, 1998 (the
"Merger Agreement), pursuant to which United Federal will merge with Triangle
Bank (the "Merger"); and,
WHEREAS, to ensure the completion of the Merger despite recent
fluctuations in the price of the Holding Company's common stock ("Triangle
Stock"), the parties wish to amend the price structure contained in the Merger
Agreement; and,
WHEREAS, the parties also wish to amend the Merger Agreement to reflect
the three-for-two stock split effected by the Holding Company on June 30, 1998.
NOW, THEREFORE, in consideration of the premises, the mutual benefits
to be derived from this Agreement, and of the representations, warranties,
conditions, covenants and promises herein contained, and subject to the terms
and conditions hereof, the Holding Company, Triangle and United Federal hereby
adopt and make this Agreement and mutually agree as follows:
1. Section 1.05.a. of the Merger Agreement is deleted and replaced in its
entirety as follows:
"At the Effective Time, all rights of United Federal's shareholders with
respect to all then outstanding shares of United Federal's common stock ($0.01
par value) ("United Federal Stock") shall cease to exist, and, as consideration
for and to effectuate the Merger (and except as otherwise provided below) each
such outstanding share of United Federal Stock (other than any shares held by
the Holding Company) shall be converted, without any action on the part of the
holder of such share, the Holding Company, Triangle or United Federal, into
0.945 (the "Exchange Rate") newly issued shares of the Holding Company's no par
value common stock ("Triangle Stock"), provided, however, that in the event the
average closing sales price of Triangle Stock for the twenty (20) trading days
preceding a date three (3) business days before the Effective Time (the "Average
Closing Price") is between $18.67 and $21.17, the Exchange Rate shall be
increased to provide a per share value of not less than $20.00 for each share of
United Federal Stock, and in the event the Average Closing Price of Triangle
Stock is between $25.51 and $28.00, the Exchange Rate shall be decreased to
provide a per share value of not more than $24.11, and provided that in the
event the Average Closing Price of Triangle Stock is between $18.66 and $17.25,
the Exchange Rate shall be
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fixed at 1.071; and in the event the Average Closing Price of Triangle Stock is
less than $17.25, the Exchange Rate shall be increased to provide a value of not
less than $18.47 per share of United Federal Stock, provided that Triangle or
United Federal may terminate the Agreement and abandon the Merger if the Average
Closing Price of Triangle Stock is less than $16.82, and provided further that
in the event the Average Closing Price of Triangle Stock is greater than $28.00,
either party, at its option and without penalty, may terminate this Agreement
(except the Holding Company in the event provided below), provided that in the
event either party does not so terminate this Agreement, the Agreement shall
remain in effect; and provided further that, after determining the Exchange Rate
required by the Average Closing Price of Triangle Stock, the Exchange Rate shall
be adjusted in the following manner: (i) if between January 1, 1998 and a date
five (5) business days prior to the Closing charge-offs by United Federal (net
of recoveries) for all loans (excluding any charge-offs for Pea Island) exceed
$500,000 the Exchange Rate shall be reduced by .0015 for each $100,000 in
charge-offs in excess of $500,000, (ii) if at month-end preceding the Closing
non-performing assets of United Federal exceed $2,000,000, the Exchange Rate
shall be reduced by .00375 for every $1,000,000 in excess of $2,000,000, on an
interpolated dollar-for-dollar basis (for purposes of this clause non-performing
assets are defined as all loans (excluding mortgage loans originated by United
Federal for sale in the secondary market and mortgage loans which are guaranteed
by the FHA or VA) which are over ninety (90) days delinquent, on non-accrual
status, or for which the borrower has filed a petition for relief under the
United States Bankruptcy Code, and all other collateral property received under
loan arrangements currently held for resale), or (iii) if on a date five (5)
business days prior to the Closing the loan loss reserve of United Federal is
less than the sum of $2,900,000 plus one and one-half percent (1.5%) for every
dollar in total loan growth over the December 31, 1997 level of $254,000,000,
the Exchange Rate shall be reduced by .00375 for every $250,000 shortfall in the
loan loss reserve (excluding any write-off of Pea Island loans) on an
interpolated dollar-for-dollar basis; then if the aggregate reduction caused by
clauses (i), (ii) and (iii) above is less than or equal to .00375, the Exchange
Rate shall not be adjusted, but if the aggregate reduction is greater than
.00375 the Exchange Rate shall be adjusted, provided that in the event the
adjustment provided for herein causes the Exchange Rate (i) to decrease by more
than one and one-half (1.5) basis points, either party hereto at its option and
without penalty may terminate this Agreement, provided that in the event that
either party does not so terminate this Agreement, this Agreement shall remain
in effect, or (ii) to yield a per share dollar value to a holder of United
Federal Stock of less than $18.47, United Federal may terminate this Agreement
at its option and without penalty, provided that in the event that United
Federal does not so terminate this Agreement, this Agreement shall remain in
effect."
In the event the Holding Company enters into a binding written agreement to
be acquired by a third party which causes the Average Closing Price of Triangle
Stock to exceed $28.00, the Holding Company shall not have the right to
terminate this Agreement based on the Average Closing Price as provided above.
Further, in such event, the Exchange Rate shall be adjusted to yield a per share
dollar value to a holder of United Federal Stock of not more than $24.11. In
such event, United Federal may still exercise its right to terminate this
Agreement as provided in this Paragraph 1.05.a.
At the Effective Time, and without any action by United Federal, Triangle,
the Holding Company or any holder thereof, United Federal's stock transfer books
shall be closed as to holders of United Federal Stock immediately prior to the
Effective Time and, thereafter, no transfer of United Federal Stock by any such
holder may be made or registered; and the holders of shares of
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United Federal Stock shall cease to be, and shall have no further rights as,
shareholders of United Federal other than as provided herein. Following the
Effective Time, certificates representing shares of United Federal Stock
outstanding at the Effective Time (herein sometimes referred to as "Old
Certificates") shall evidence only the right of the registered holder thereof to
receive, and may be exchanged for, certificates for the number of whole shares
of the Triangle Stock to which such holders shall have become entitled on the
basis set forth above, plus cash for any fractional share interests as provided
herein."
2. All other terms of the Merger Agreement shall remain in full form and effect.
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IN WITNESS WHEREOF, United Federal, Triangle and the Holding Company each has
caused this Agreement to be executed in its name by its duly authorized officers
as of the date first above written.
TRIANGLE BANCORP, INC.
By: /s/ Michael S. Patterson
--------------------------
Michael S. Patterson
President and Chief
Executive Officer
ATTEST:
/s/ Susan C. Gilbert
- --------------------
Susan C. Gilbert, Secretary
TRIANGLE BANK
[Corporate Seal]
By: /s/ Michael S. Patterson
--------------------------
Michael S. Patterson
President and Chief
Executive Officer
ATTEST:
/s/ Susan C. Gilbert
- --------------------
Susan C. Gilbert, Secretary
[Corporate Seal]
UNITED FEDERAL SAVINGS BANK
By: /s/ John A. Barker
--------------------------
John A. Barker
President and Chief
Executive Officer
ATTEST:
/s/ Paula V. Walker
- --------------------
Paula V. Walker, Assistant Secretary
[Corporate Seal]
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