Exhibit 2.2
PLAN OF SHARE EXCHANGE
THIS PLAN OF SHARE EXCHANGE (the "Plan") is made and entered into this
23rd day of August 2004, between Southern Heritage Bank, a Tennessee banking
corporation ("Bank"), which has always been named such, and Southern Heritage
Bancshares, Inc., a Tennessee corporation ("BHC"), which has always been named
such.
W I T N E S S E T H:
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WHEREAS, the principal offices of Bank and BHC are located at 3020
Keith Street, Cleveland, Tennessee 37312; and
WHEREAS, the authorized capital stock of Bank consists of 2,000,000
shares of Common Stock ("Bank Stock"), $1.00 par value, of which 1,024,720
shares are issued and outstanding and 262,500 are reserved for stock options,
and 1,000,000 shares of Preferred Stock, no designated par value, of which no
shares are issued or outstanding; and
WHEREAS, the authorized capital stock of BHC consists of 2,000,000
shares of Common Stock ("BHC Stock"), $1.00 par value, of which 10 shares are
issued and outstanding, and 1,000,000 shares of Preferred Stock, no designated
par value, of which no shares are issued or outstanding; and
WHEREAS, the respective Boards of Directors and shareholders of Bank on
March 18, 2004, and May 20, 2004, respectively, and BHC on April 15, 2004, and
April 15, 2004, respectively, have approved that Bank be acquired by BHC (the
"Share Exchange") and, by resolutions duly adopted, have approved and adopted
this Plan.
NOW, THEREFORE, in consideration of the premises, mutual covenants and
agreements herein contained, and for the purpose of stating the method, terms
and conditions of the Share Exchange provided for herein, the mode of carrying
the same into effect, the manner and basis of converting and exchanging the
shares of Bank Stock as hereinafter provided, and such other provisions relating
to the Share Exchange as the parties deem necessary or desirable, the parties
hereto agree as follows:
ARTICLE I
SHARE EXCHANGE
Subject to the terms and conditions of this Plan and the Share Exchange
Agreement, at the Effective Time (as hereinafter defined), Bank stock shall be
exchanged with BHC stock pursuant to the provisions of, and with the effect
provided in, Tennessee Code ss.45-2-1314 and ss.48-21-103 (said transaction
being hereinafter referred to as the "Share Exchange"). At the Effective Time,
the Bank Stock shall be acquired by BHC, and Bank shall become a wholly-owned
subsidiary of BHC as further described below.
ARTICLE II
CHARTER, BYLAWS, AND NAME
Upon and after the Effective Time, the Charter, Bylaws, and name of
Bank and of BHC in effect immediately prior to the Effective Time shall be the
Charter, Bylaws, and name of Bank and BHC in each case until further amended in
accordance with applicable law.
ARTICLE III
BOARD OF DIRECTORS AND OFFICERS
As of the Effective Time, the board of directors and officers of the
Bank and BHC shall consist respectively of those persons serving as directors
and officers of the Bank and BHC immediately prior to the Effective Time.
ARTICLE IV
CONVERSION AND EXCHANGE OF STOCK
1. As of the Effective Time of the Share Exchange, each share of
Bank Stock (or options to purchase Bank Stock) issued and outstanding
immediately prior to the Effective Time shall, by virtue of the Share Exchange
becoming effective and without any action on the part of anyone, be exchanged
on a one-for-one basis for shares of BHC Stock (or options to purchase BHC
Stock). Previously outstanding shares of BHC Stock shall be redeemed for $10.00
per share.
2. As soon as reasonably practicable after the Effective Time of
the Share Exchange, each registered holder of the outstanding Bank Stock shall
deliver, or cause to be delivered, to BHC, the certificates evidencing and
representing all shares of Bank Stock which were validly issued and outstanding
and held by such holder immediately prior to the Effective Time of the Share
Exchange, and BHC shall take prompt action to process such certificates
evidencing and representing Bank Stock received by it (including the prompt
return of defective submissions with instructions as to those actions which may
be necessary to remedy such defects). Upon receipt of the proper submission of
the certificates formerly representing and evidencing Bank Stock, BHC shall, on
or prior to the 30th day after the Effective Time of the Share Exchange, mail to
the former Bank shareholders in exchange for Bank Stock formerly owned by them,
certificates for shares of BHC Stock. Alternatively, BHC may send stickers
to each Bank shareholder to be applied to the certificate of Bank Stock, which
stickers will indicate that the certificates now represent a like number of
shares of BHC Stock. After the Effective Time of the Share Exchange and until
properly surrendered to BHC, each outstanding certificate or certificates which
formerly evidenced and represented the Bank Stock, subject to the provisions
of this Section, shall be deemed for all corporate purposes to represent the
shares of BHC Stock into which such holder's Bank Stock were converted and
aggregated at the Effective Time of the Share Exchange. The registered
holder of any certificate(s) representing Bank Stock which shall have been lost
or destroyed may be subject to the provisions of this Section, obtain his or her
certificate for BHC Stock provided that such shareholder(s) shall deliver to the
Exchange Agent: (i) a sworn statement certifying such loss or destruction and
specifying the circumstances thereof and (ii) an indemnity or lost instrument
bond in form satisfactory to BHC which has been duly executed by a corporate
surety satisfactory to BHC, indemnifying the Bank and BHC (and their respective
successors) to their satisfaction against any loss or expense which any of them
may incur as a result of such lost or destroyed certificates being thereafter
presented. Any costs or expenses which may arise from such procedure, including
the premium on the lost instrument bond, shall be for the account of the
shareholder.
3. At the Effective Time of the Share Exchange, the stock transfer
books of Bank shall be closed and no transfer of Bank Stock shall be made
thereafter except by BHC.
4. Notwithstanding anything to the contrary herein, any holder of
Bank Stock who shall comply strictly with the provisions of T.C.A. ss.45-2-1309
and ss.48-23-101, et seq. shall be entitled to dissent from the Share Exchange
and to seek those appraisal remedies afforded therein. However, BHC shall not be
obligated to consummate the Share Exchange if the holders of more than 5% of the
outstanding shares of Bank Stock issued and outstanding immediately prior to the
Effective Time shall have perfected their dissenters' rights, and the perfected
status of said dissenters' rights shall have continued to the time of Closing.
ARTICLE V
EFFECTIVE TIME OF THE SHARE EXCHANGE
The Share Exchange shall be effective at the time and on the date that
this Plan is filed with the Commissioner of Financial Institutions for the State
of Tennessee (the "Commissioner") and then the Tennessee Secretary of State
pursuant to and together with the other documents specified in Tennessee Code
Section 45-2-1301, et seq. or such later time and date as the parties may agree.
ARTICLE VI
CONDITIONS PRECEDENT
The obligations of Bank and BHC to effect the Share Exchange as herein
provided shall be subject to the approval of the Commissioner, the approval of
the Federal Reserve System, and the approval of the shareholders of Bank and BHC
in accordance with federal and Tennessee law.
ARTICLE VII
TERMINATION
Anything contained in this Plan to the contrary notwithstanding, and
notwithstanding adoption hereof by the shareholders of Bank and BHC, this Plan
may be terminated and the Share Exchange abandoned upon the mutual consent of
the board of directors of Bank and BHC.
ARTICLE VII
MISCELLANEOUS
1. This Plan may be amended or supplemented at any time by mutual
agreement of Bank and BHC. Any such amendment or supplement must be in writing
and approved by their respective Boards of Directors.
2. Any notice or other communication required or permitted under
this Plan shall be given, and shall be effective, upon delivery to an officer of
a party.
3. The headings of the several Articles herein are inserted for
convenience of reference only and are not intended to be a part of or to affect
the meaning or interpretation of this Plan.
4. This Plan may be executed in several counterparts, each of which
shall be deemed the original, but all of which together shall constitute one and
the same instrument.
5. This Plan shall be governed by and construed in accordance with
the laws of the State of Tennessee applicable to agreements made and entirely to
be performed in such state, except to the extent federal law may be applicable.
ADDITIONAL INFORMATION
Additional copies of all information, including financial projections
provided to the Federal Reserve Board may be obtained by writing or calling
Southern Heritage Bancshares, Inc. Inc., c/o Southern Heritage Bank, 3020 Keith
Street, Cleveland, Tennessee 37312.
SOUTHERN HERITAGE BANK
By: /s/ J. Lee Stewart
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Title: President & CEO
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ATTEST:
/s/ Virginia Kibble
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Cashier
SOUTHERN HERITAGE BANCSHARES, INC.
By: /s/ J. Lee Stewart
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Title: President & CEO
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ATTEST:
/s/
Steven W. Ledbetter
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CFO