AGREEMENT AND PLAN OF MERGER
OF
SOUTHTRUST OF ALABAMA, INC.
AND
FLORIDAFIRST BANCORP, INC.
JOINED IN BY
SOUTHTRUST CORPORATION
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TABLE OF CONTENTS
ARTICLE 1
THE MERGER
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<C>
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Section 1.1
Consummation of Merger; Closing
Date............................................................2
Section 1.2
Effect of
Merger................................................................................2
Section 1.3
Further
Assurances..............................................................................3
Section 1.4
Directors and
Officers..........................................................................3
ARTICLE 2
CONVERSION OF CONSTITUENTS' CAPITAL SHARES
Section 2.1
Manner of Conversion of FloridaFirst
Shares.....................................................3
Section 2.2
FloridaFirst Stock Options and Related
Matters..................................................6
Section 2.3
Fractional
Shares...............................................................................7
Section 2.4
Effectuating
Conversion.........................................................................7
Section 2.5 Laws
of
Escheat.................................................................................9
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF FLORIDAFIRST
Section 3.1
Corporate
Organization..........................................................................9
Section 3.2
Capitalization.................................................................................10
Section 3.3
Financial Statements;
Filings..................................................................11
Section 3.4 Loan
Portfolio;
Reserves.......................................................................12
Section 3.5
Certain Loans and Related
Matters..............................................................12
Section 3.6
Authority; No
Violation........................................................................13
Section 3.7
Consents and
Approvals.........................................................................14
Section 3.8
Broker's
Fees..................................................................................14
Section 3.9
Absence of Certain Changes or
Events...........................................................14
Section 3.10 Legal
Proceedings;
Etc.........................................................................14
Section 3.11 Taxes and
Tax
Returns..........................................................................15
Section 3.12 Employee
Benefit
Plans.........................................................................16
Section 3.13 Title and
Related
Matters......................................................................18
Section 3.14 Real
Estate....................................................................................19
Section 3.15
Environmental
Matters..........................................................................19
Section 3.16
Commitments and
Contracts......................................................................21
Section 3.17
Regulatory, Accounting and Tax
Matters.........................................................22
Section 3.18
Registration
Obligations.......................................................................22
Section 3.19
Antitakeover
Provisions........................................................................22
Section 3.20
Insurance......................................................................................22
Section 3.21
Labor..........................................................................................22
Section 3.22 Compliance
with
Laws...........................................................................23
Section 3.23
Transactions with
Management...................................................................24
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Section 3.24 Derivative
Contracts...........................................................................24
Section 3.25
Deposits.......................................................................................24
Section 3.26 Accounting
Controls; Disclosure
Controls.......................................................24
Section 3.27 Proxy
Materials................................................................................25
Section 3.28 Deposit
Insurance..............................................................................25
Section 3.29
Intellectual
Property..........................................................................25
Section 3.30 SEC
Filings....................................................................................25
Section 3.31 Untrue
Statements and
Omissions................................................................25
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF SOUTHTRUST AND ST-SUB
Section 4.1
Organization and Related Matters of
SouthTrust.................................................26
Section 4.2
Organization and Related Matters of
ST-Sub.....................................................26
Section 4.3
Capitalization.................................................................................27
Section 4.4
Authorization..................................................................................27
Section 4.5
Financial
Statements...........................................................................28
Section 4.6
Absence of Certain Changes or
Events...........................................................28
Section 4.7
Consents and
Approvals.........................................................................29
Section 4.8
Proxy
Materials................................................................................29
Section 4.9
Accounting, Tax, Regulatory
Matters............................................................29
Section 4.10 No
Broker's or Finder's
Fees...................................................................29
Section 4.11 Untrue
Statements and
Omissions................................................................29
Section 4.12 Legal
Proceedings,
Etc.........................................................................29
Section 4.13 Compliance
with
Laws...........................................................................30
Section 4.14 SEC
Filings....................................................................................30
ARTICLE 5
COVENANTS AND AGREEMENTS
Section 5.1
Conduct of the Business of FloridaFirst and FloridaFirst
Subsidiaries..........................31
Section 5.2
Current
Information............................................................................33
Section 5.3
Access to Properties; Personnel and Records; Systems
Integration...............................34
Section 5.4
Approval of FloridaFirst
Shareholders..........................................................35
Section 5.5 No
Other
Bids..................................................................................35
Section 5.6
Maintenance of Properties; Certain Remediation and Capital
Improvements........................36
Section 5.7
Environmental
Audits...........................................................................36
Section 5.8
Title
Insurance................................................................................36
Section 5.9
Surveys........................................................................................36
Section 5.10 Consents
to Assign and Use Leased
Premises.....................................................36
Section 5.11 Compliance
Matters.............................................................................37
Section 5.12 Conforming
Accounting and Reserve
Policies.....................................................37
Section 5.13 Bank
Merger
Agreement..........................................................................37
Section 5.14
Affiliates.....................................................................................37
Section 5.15 Advisory
Board.................................................................................37
ii
<PAGE>
Section 5.16 Restricted
Stock
Awards........................................................................38
Section 5.17
Publicity......................................................................................38
Section 5.18
Certification of
Claims........................................................................38
ARTICLE 6
ADDITIONAL COVENANTS AND AGREEMENTS
Section 6.1 Best
Efforts;
Cooperation......................................................................38
Section 6.2
Regulatory
Matters.............................................................................38
Section 6.3
Employment and Employee Benefits
Matters.......................................................39
Section 6.4
Indemnification................................................................................42
Section 6.5
Registration
Statement.........................................................................43
ARTICLE 7
MUTUAL CONDITIONS TO CLOSING
Section 7.1
Shareholder
Approval...........................................................................44
Section 7.2
Regulatory
Approvals...........................................................................44
Section 7.3
Litigation.....................................................................................44
Section 7.4
Proxy Statement and Registration
Statement.....................................................44
Section 7.5 Tax
Opinion....................................................................................44
ARTICLE 8
CONDITIONS TO THE OBLIGATIONS OF SOUTHTRUST AND ST-SUB
Section 8.1
Representations and
Warranties.................................................................44
Section 8.2
Performance of
Obligations.....................................................................45
Section 8.3
Certificate Representing Satisfaction of
Conditions............................................45
Section 8.4
Absence of Adverse
Facts.......................................................................45
Section 8.5
Opinion of
Counsel.............................................................................45
Section 8.6
Consents Under
Agreements......................................................................45
Section 8.7
Consents Relating to Leased Real
Property......................................................45
Section 8.8
Material
Condition.............................................................................46
Section 8.9
Matters Relating to Employment
Agreements......................................................46
Section 8.10
Acknowledgment of Option
Payments..............................................................46
Section 8.11
Outstanding Shares of
FloridaFirst.............................................................46
Section 8.12 Increase
in
Borrowing..........................................................................46
ARTICLE 9
CONDITIONS TO OBLIGATIONS OF FLORIDAFIRST
Section 9.1
Representations and
Warranties.................................................................47
Section 9.2
Performance of
Obligations.....................................................................47
Section 9.3
Certificate Representing Satisfaction of
Conditions............................................47
Section 9.4
Absence of Adverse
Facts.......................................................................47
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Section 9.5
Consents Under
Agreements......................................................................47
Section 9.6
Opinion of
Counsel.............................................................................48
Section 9.7
SouthTrust
Shares..............................................................................48
ARTICLE 10
TERMINATION, WAIVER AND AMENDMENT
Section 10.1
Termination....................................................................................48
Section 10.2 Effect of
Termination; Termination
Fee.........................................................49
Section 10.3
Amendments.....................................................................................50
Section 10.4
Waivers........................................................................................50
Section 10.5
Non-Survival of Representations and
Warranties.................................................50
ARTICLE 11
MISCELLANEOUS
Section 11.1
Alternative
Structure..........................................................................50
Section 11.2
Definitions....................................................................................51
Section 11.3 Entire
Agreement...............................................................................52
Section 11.4
Notices........................................................................................52
Section 11.5
Severability...................................................................................53
Section 11.6 Costs and
Expenses.............................................................................54
Section 11.7
Captions.......................................................................................54
Section 11.8
Counterparts...................................................................................54
Section 11.9 Persons
Bound; No
Assignment...................................................................54
Section 11.10 Governing Law;
Arbitration.....................................................................54
Section 11.11 Exhibits and
Schedules.........................................................................54
Section 11.12
Waiver.........................................................................................54
Section 11.13 Construction of
Terms..........................................................................55
Section 11.14 Specific
Performance...........................................................................55
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<PAGE>
AGREEMENT AND PLAN OF MERGER
OF
SOUTHTRUST OF ALABAMA, INC.
WITH
FLORIDAFIRST BANCORP, INC.
______________________
LIST OF SCHEDULES
______________________
Schedule 2.2(a)
Stock Options
Schedule 2.2(c)
Restricted Stock Awards
Schedule 3.1(e)
Ownership
Interests
Schedule 3.2
Capitalization - Stock Options
Schedule 3.3(e)
Material Obligations
Schedule 3.4
Problems with Loan Portfolio
Schedule 3.5
Certain Loans and Related Matters
Schedule 3.7
Consents Required in Connection with Merger
Schedule 3.8
Broker Engagement Letter
Schedule 3.9
Certain Changes or Events
Schedule 3.10
Legal Proceedings
Schedule 3.11
Problems with Tax Returns, Etc.
Schedule 3.12(a)
Employee Benefit Plans
Schedule 3.12(b)
Defined Benefit Plans
Schedule 3.12(g)
Effect of Merger on Employee Benefits
Schedule 3.12(m)
Continuing Obligations Under Employee Benefits Plans
Schedule 3.12(n)
Funding of Employee Benefit Plans
Schedule 3.13(a)
Title and Related Matters
Schedule 3.13(b)
Real Property Leases
Schedule 3.14(a)
List of Real Estate
Schedule 3.14(b)
List of Real Property Leases
Schedule 3.15
Environmental Matters
Schedule 3.16(a)
Certain Commitments and Contracts
Schedule 3.16(b)
Defaults Under Material Agreements
Schedule 3.16(c)
Effect of Merger on Service Contracts
Schedule 3.16(d)
Contract Extensions or Terminations
Schedule 3.20
Insurance Policies
Schedule 3.21(b)
Severance
Schedule 3.21(c)
Non-Compliance with Labor Laws
Schedule 3.21(d)
Legal Proceedings Related to Labor Matters
Schedule 3.22
Compliance with Laws
Schedule 3.23
Transactions with Management
Schedule 3.24
Derivative Contracts
Schedule 5.1(b)(iv)
Capital Expenditures
Schedule 5.1(b)(v)
Other Real Estate Owned
Schedule 5.1(b)(vi)
Salary Adjustments
v
<PAGE>
AGREEMENT AND PLAN OF MERGER OF
SOUTHTRUST OF ALABAMA, INC.
WITH
FLORIDAFIRST BANCORP, INC.
__________________________
LIST OF EXHIBITS
__________________________
Exhibit 5.14: Bank Merger
Agreement
Exhibit 5.15: Affiliate
Letter
Exhibit 8.5: Matters as
to which Malizia Spidi & Fisch, PC, Counsel to
FloridaFirst, will opine
Exhibit 9.6: Matters as
to which Bradley Arant Rose & White LLP, Counsel to
SouthTrust and ST-Sub, will opine
vi
<PAGE>
AGREEMENT AND PLAN OF MERGER
OF
SOUTHTRUST OF ALABAMA, INC.
AND
FLORIDAFIRST BANCORP, INC.
JOINED IN BY
SOUTHTRUST CORPORATION
----------------------
This AGREEMENT AND PLAN OF MERGER, dated as of the 4th day of
February,
2004 (this "Agreement"), by and between SouthTrust of
Alabama, Inc., an Alabama
corporation ("ST-Sub"), and FloridaFirst Bancorp,
Inc., a Florida
corporation
("FloridaFirst"), and joined in by SouthTrust Corporation, a Delaware
corporation ("SouthTrust") (collectively,
the "Parties").
WITNESSETH THAT:
WHEREAS, the
respective Boards of Directors of ST-Sub and FloridaFirst
deem it in the best interests of ST-Sub and
of FloridaFirst,
respectively, and
of their respective shareholders, that
ST-Sub and FloridaFirst merge pursuant to
this Agreement in a transaction that
qualifies as a
reorganization
pursuant to
Section 368 of the Internal Revenue Code of 1986 (as amended,
the "Code") (the
"Merger"); provided, however, that the parties have agreed that
under certain
circumstances the transaction may be restructured so as to avoid a
corporate
level tax on the transaction, and in such event, the parties
will enter into an
appropriate amendment to the Agreement to
reflect such restructuring;
WHEREAS, the
Boards of Directors of ST-Sub and FloridaFirst have
approved this Agreement and have directed that this
Agreement be submitted
to
their respective shareholders for approval and
adoption in accordance with the
laws of the State of Alabama, the State of
Florida and the United States;
WHEREAS, SouthTrust,
the sole shareholder
of ST-Sub, will deliver, or
cause to be delivered, to the shareholders of
FloridaFirst the consideration to
be paid pursuant to the Merger in
accordance with the
terms of this
Agreement;
and
WHEREAS, FloridaFirst owns all the issued and outstanding capital
stock
of FloridaFirst Bank, a federal savings
bank ("FF-Bank"), and ST-Sub owns all of
the issued and outstanding capital stock of SouthTrust
Bank, an Alabama
state
banking corporation ("ST-Bank"), and it is
contemplated that, in connection with
the consummation of this Agreement and pursuant to
the
1
<PAGE>
terms of a certain Bank Merger Agreement
(the "Bank Merger Agreement"), FF-Bank
will be merged with and into ST-Bank (the
"Bank Merger");
NOW, THEREFORE,
in consideration of the premises and the mutual
covenants, representations, warranties and agreements
herein contained, the
parties agree that FloridaFirst will be
merged with and into ST-Sub and that the
terms and conditions of the Merger, the
mode of carrying the Merger into effect,
including the manner of converting
the shares of common
stock of
FloridaFirst,
par value $0.10 per share, into shares of
common stock of SouthTrust, par value
of $2.50 per share, or other consideration
shall be as hereinafter set forth.
ARTICLE 1
THE MERGER
Section 1.1 Consummation of Merger; Closing Date.
------------------------------------
(a) Subject to the provisions hereof, FloridaFirst shall be merged
with
and into ST-Sub (which has heretofore and shall hereinafter be referred to as
the "Merger") pursuant to the laws of the States
of Alabama and
Florida, and
ST-Sub shall be the surviving corporation
(sometimes hereinafter
referred to as
"Surviving Corporation" when reference is
made to it after the Effective Time of
the Merger (as defined below)). The Merger shall become
effective on the
date
and at the time on which Articles of Merger have been duly filed with the
Secretaries of State of Alabama and
Florida, unless a later date is specified in
such Articles of Merger (such time is
hereinafter referred
to as the "Effective
Time of the Merger"). Subject to the terms and conditions hereof, unless
otherwise agreed upon by SouthTrust and
FloridaFirst, the
Effective Time of the
Merger shall occur on the tenth (10th)
business day following the later to occur
of (i) the effective date (including expiration of any applicable waiting
period) of the last required Consent (as defined herein) of any Regulatory
Authority (as defined herein) having authority over the transactions
contemplated under the Merger Agreement or the Bank Merger
Agreement and (ii)
the date on which the shareholders of FloridaFirst approve the transactions
contemplated by this Agreement, or such
other time as the parties may agree.
(b) The closing of the Merger (the "Closing") shall take place at the
principal offices of FloridaFirst at 10:00 a.m. local
time on the day that the
Effective Time of the Merger occurs,
or such other date,
time and place as
the
parties hereto may agree (the "Closing
Date"). Subject to the provisions of this
Agreement, at the Closing there shall be
delivered to each of the parties hereto
the opinions, certificates and other
documents and instruments required to be so
delivered pursuant to this Agreement.
Section 1.2 Effect of
Merger. At the
Effective Time of the Merger,
----------------
FloridaFirst shall be merged with and into
ST-Sub and the separate existence of
FloridaFirst shall cease. The Articles of
Incorporation and Bylaws of ST-Sub, as
in effect on the date hereof and as
otherwise amended prior to the Effective
Time of the Merger, shall be the Articles
of Incorporation and the Bylaws of the
Surviving Corporation until further amended as provided therein and in
accordance with applicable law. The Surviving Corporation shall have all the
rights, privileges, immunities and powers
and shall be subject to all the duties
and liabilities of a corporation
2
<PAGE>
organized under the laws of the State of Alabama and shall thereupon and
thereafter possess all other privileges,
immunities and franchises of a private,
as well as of a public nature, of each of the constituent corporations. All
property (real, personal and mixed) and all
debts on whatever account, including
subscriptions to shares, and all choses in
action, all and every other interest,
of or belonging to or due to each of the
constituent
corporations
so merged
shall be taken and deemed to be transferred to and vested in the Surviving
Corporation without further act or deed. The title to
any real estate, or
any
interest therein, vested in any of the
constituent corporations shall not revert
or be in any way impaired by reason of the Merger.
The Surviving Corporation
shall thenceforth be responsible and liable for all the liabilities and
obligations of each of the constituent corporations so merged and any claim
existing or action or proceeding pending by
or against either of the constituent
corporations may be prosecuted as if the Merger had not taken place or the
Surviving Corporation may be substituted in its place. Neither the rights of
creditors nor any liens upon the property
of any constituent
corporation shall
be impaired by the Merger.
Section 1.3 Further
Assurances. From and
after the Effective
Time of
-------------------
the Merger, as and when requested by the
Surviving Corporation, the officers and
directors of FloridaFirst last in office shall execute and
deliver or cause to
be executed and delivered in the name of FloridaFirst such deeds and other
instruments and take or cause to be taken
such further or other actions as shall
be necessary in order to vest or perfect in
or confirm of record or otherwise to
the Surviving Corporation title to and possession of all of the property,
interests, assets, rights, privileges, immunities, powers, franchises and
authority of FloridaFirst.
Section 1.4 Directors and Officers. From and after the Effective
Time
----------------------
of the Merger, the directors of the Surviving
Corporation
and officers of
the
Surviving Corporation shall be those persons serving as
directors and officers
of ST-Sub immediately prior to the Effective Time of the Merger, and such
additional persons, in each case, as SouthTrust,
at or prior to the
Effective
Time of the Merger, shall designate in
writing.
ARTICLE 2
CONVERSION OF CONSTITUENTS' CAPITAL SHARES
Section 2.1 Manner of Conversion of FloridaFirst Shares. Subject to
the
-------------------------------------------
provisions hereof, as of the Effective Time of the
Merger and by virtue of the
Merger and without any further action on the part of SouthTrust, ST-Sub,
FloridaFirst or the holder of any shares
thereof, the shares of
the constituent
corporations shall be converted as
follows:
(a) Each share of capital stock of ST-Sub outstanding immediately
prior
to the Effective Time of the Merger shall, after the Effective Time of the
Merger, remain outstanding and unchanged
and thereafter shall constitute all of
the issued and outstanding shares of
capital stock of the Surviving Corporation.
(b) Each share of
common stock of FloridaFirst (the "FloridaFirst
Shares") held by FloridaFirst or by SouthTrust (or any of their
subsidiaries),
other than in a fiduciary capacity or as a result of debts previously
contracted, shall be canceled and retired and
no consideration shall be paid or
delivered in exchange therefor.
3
<PAGE>
(c) Except with
regard to: (i)
FloridaFirst
Shares excluded under
Section 2.1(b) above and (ii) FloridaFirst Shares the holder of which has
elected to receive the per share cash
consideration provided
in Section 2.1(d),
each FloridaFirst Share outstanding immediately prior to the Effective
Time of
the Merger shall be converted into the
right to receive that number of shares of
common stock of SouthTrust (and the rights
associated therewith pursuant to that
certain Amended and Restated Rights
Agreement dated as of August 1, 2000 between
SouthTrust and American Stock Transfer & Trust Company (together, the
"SouthTrust Shares")) that is equal to the quotient obtained by dividing (i)
$146,123,851 plus the product of $27.12 and the
number of FloridaFirst
Shares
issued pursuant to the exercise of
FloridaFirst
Options (as defined in
Section
2.2) (the "Total Consideration")
subsequent to the date
hereof but prior to the
Effective Time by (ii) the product of the Average
Market Price and the total
number of issued and outstanding
FloridaFirst Shares
(exclusive of any treasury
shares) at the Effective Time of the
Merger. (Such number
of SouthTrust Shares,
as may be adjusted as provided herein, is hereinafter referred to as the "Per
Share Stock Consideration"). Thereafter,
subject to Sections 2.1(d) and 2.3, all
outstanding certificates representing
FloridaFirst Shares shall represent solely
the right to receive SouthTrust Shares. Except as may be provided below,
the
"Average Market Price" shall be the average of the
closing per share
trading
prices of SouthTrust Shares (adjusted
appropriately for any
stock split, stock
dividend, recapitalization, reclassification or similar transaction which is
effected, or for which a record date
occurs) on the twenty
(20) trading
days
preceding the fifth trading day immediately prior to the Closing Date, as
reported in the Wall Street Journal.
In the event of an Acquisition Transaction (as defined in Section
10.2)
with respect to SouthTrust which is
publicly announced subsequent to the date of
this Agreement and on or before the
Effective Time of the
Merger, the
"Average
Market Price" shall be the average of the
closing per share
trading prices of
SouthTrust Shares on the twenty (20) trading
days preceding
the fifth trading
day immediately prior to the date of this
Agreement,
as reported in the
Wall
Street Journal.
(d) Notwithstanding the provisions of Section 2.1(c) above, each
holder
of FloridaFirst Shares shall be provided
with an opportunity to elect to receive
cash consideration for a portion or all of
such holder's
FloridaFirst Shares in
lieu of receiving SouthTrust Shares under
Section 2.1(c), in accordance with the
election procedures set forth in this
Section 2.1(d).
Holders who elect to receive cash in lieu of exchanging FloridaFirst
Shares for SouthTrust Shares as specified below shall receive $27.12 in cash
(the "Per Share Cash Consideration") for each FloridaFirst Share so
converted;
provided, however, that in no event shall the
aggregate amount of cash to be
paid to holders of FloridaFirst Shares in
exchange for their FloridaFirst Shares
exceed 49% of the Total Consideration.
(i) SouthTrust will
use its commercially
reasonable efforts
to
cause
the Exchange Agent to mail an election form in such form as
SouthTrust and
FloridaFirst
shall mutually agree
(the "Election Form") at
least 20 days
prior to the date of the FloridaFirst Shareholders' Meeting
or on such other
date as SouthTrust and
FloridaFirst shall
mutually agree
(the "Mailing
Date") to each holder of record of FloridaFirst Shares as of
the record date
for the FloridaFirst
Shareholders' Meeting.
Each Election
Form
4
<PAGE>
shall permit a
holder (or the
beneficial owner
through appropriate and
customary
documentation and
instructions) of FloridaFirst Shares to elect
to receive cash with respect to all or a portion of such holder's
FloridaFirst
Shares (shares as to which the election is made being referred
to as "Cash Election
Shares").
(ii) Any FloridaFirst Shares with respect to which the holder
(or
the beneficial
owner, as the case may be) shall not have
submitted to the
Exchange Agent
an effective, properly
completed Election Form on or before
5:00
p.m. Eastern Time on the date of the FloridaFirst Shareholders'
Meeting (or such
other time and date as
SouthTrust and
FloridaFirst
may
mutually
agree) (the "Election Deadline") shall be converted into
SouthTrust
Shares as set forth in
Section 2.1(c) of this
Agreement (such
shares being
referred to as
"Exchange Shares").
Any Election Form may
be
revoked or
changed by the person
submitting such Election Form at or prior
to the Election Deadline. In the
event an Election Form is revoked prior to
the Election
Deadline, the FloridaFirst Shares represented by such Election
Form shall
become Exchange
Shares. Subject to the
terms of this Agreement
and of the Election Form, the Exchange Agent shall have reasonable
discretion to
determine whether any election, revocation or change has been
properly or
timely made and to disregard immaterial defects in the Election
Forms,
and any good faith
decisions of the
Exchange Agent
regarding such
matters
shall be binding and conclusive. Neither SouthTrust nor the
Exchange
Agent shall be under
any obligation
to notify any person
of any
defect in an
Election Form.
(iii)Within three
business days after the Election Deadline,
unless
the Effective Time has not yet occurred, in which case as soon
thereafter as
practicable,
SouthTrust shall use
commercially
reasonable
efforts
to cause the
Exchange Agent to effect the allocation among the
holders of
FloridaFirst
Shares in accordance
with the Election
Forms as
follows:
(A) Cash Elections by No More Than 49% of the Total
-------------------------------------------------------
Consideration. If the amount of cash payable to holders
-------------
of FloridaFirst
Shares electing to receive cash does
not exceed
49% of the Total
Consideration,
then all
Cash Election Shares
shall be converted into the right
to receive the Per Share Cash Consideration, and all of
the Exchange Shares
shall be converted
into the right
to receive
SouthTrust
Shares, pursuant to Section
2.1(c).
(B) Cash Elections More Than 49% of the Total
-------------------------------------------------------
Consideration. If the
amount of cash
that otherwise
-------------
would be payable to
holders of FloridaFirst Shares
electing to receive
cash would exceed 49% of the Total
Consideration, then:
(1) the number
of Cash Election Shares designated
by
each holder
of FloridaFirst Shares who properly
submitted a Cash Election Form Shall be automatically
reduced to that number of shares
5
<PAGE>
equal to the product of (A) 49% of the Total
Consideration and (B)
a fraction,
the numerator of
which is the number of
such holder's Cash
Election
Shares designated
in such holder's Election Form,
and the denominator of
which is the total number
of Cash Election Shares designated in all Election
Forms;
(2) the Cash
Election Shares that remain following
proration under
subsection
(1) above shall be
converted into the right to receive the Per Share
Cash Consideration;
(3) the FloridaFirst
Shares that
would have been
Cash
Election Shares but for the proration pursuant to
to subsection
(1) above shall automatically be
deemed to be Exchange Shares; and
(4) all Exchange
Shares shall be converted into the
right to receive SouthTrust Shares, pursuant to
Section 2.1(c).
Section 2.2 FloridaFirst Stock Options and Related Matters.
----------------------------------------------
(a) As of the Effective Time of the Merger, all rights with respect to
FloridaFirst Shares issuable pursuant to the exercise of stock options
("FloridaFirst Options") granted by FloridaFirst under the 1999 and 2002
FloridaFirst Stock Option Plans (the
"FloridaFirst Stock Option Plans"), each of
which are listed and described on Schedule
2.2(a) and which are
outstanding at
the Effective Time of the Merger,
shall be canceled as
of the Effective Time of
the Merger and shall be converted
into the right to
receive in cash, to be paid
by FloridaFirst to the option holder at or
immediately prior to
the Effective
Time of the Merger, subject to applicable withholding taxes, the difference
between (A) $27.12 and (B) the exercise
price of each
FloridaFirst Share
under
such FloridaFirst Option as listed on Schedule 2.2 (a) hereof, for each
FloridaFirst Share under such FloridaFirst
Options.
(b) FloridaFirst
shall procure from each holder of FloridaFirst
Options, and shall deliver to SouthTrust at the Closing, an executed
acknowledgment and receipt of the payments
specified in Section 2.2(a).
(c) At or immediately
prior to the Effective Time, any unvested awards
under the 1999 and 2002 Restricted Stock Plans, which awards are described on
Schedule 2.2(c), shall become earned and
non-forfeitable and distributed in the
form of FloridaFirst Shares at or
immediately prior to the Effective Time of the
Merger. Such FloridaFirst Shares shall be deemed Exchange Shares and shall
convert at the Effective Time into the right to receive
the Per Share
Stock
Consideration.
6
<PAGE>
Section 2.3 Fractional Shares. Notwithstanding any other provision of
-----------------
this Agreement, each holder of FloridaFirst
Shares converted pursuant to the
Merger who would otherwise have been entitled to receive a fraction of a
SouthTrust Share (after taking into account
all certificates
delivered by such
holder), shall receive, in lieu thereof, cash (without interest) in an
amount
equal to such fractional part of such
SouthTrust Share, multiplied by the market
value of one SouthTrust Share at the Effective
Time of the Merger.
The market
value of a SouthTrust Share at the
Effective Time of the Merger, as the case may
be, shall be the last sale price of such
SouthTrust Shares,
as reported by The
Nasdaq Stock Market ("NASDAQ") on the last business
day preceding the Effective
Time of the Merger, as the case may be, or, if the
SouthTrust Shares
hereafter
become listed for trading on any national
securities
exchange registered
under
the Exchange Act, the last sale price of such SouthTrust Shares on the
applicable date as reported on the principal
securities
exchange on which
the
SouthTrust Shares are then listed for
trading. No such
holder will be entitled
to dividends, voting rights or any other rights
as a shareholder in
respect of
any fractional share.
Section 2.4 Effectuating Conversion.
-----------------------
(a) American Stock Transfer & Trust Company, or such other third party
institution as SouthTrust and ST-Bank may
designate, shall serve as the exchange
agent (the "Exchange Agent"). The Exchange Agent may employ sub-agents in
connection with performing its duties.
As of the Effective
Time of the Merger,
SouthTrust will deliver or cause to be
delivered to the Exchange Agent the
consideration to be paid by SouthTrust for
FloridaFirst Shares,
along with the
appropriate cash payment in lieu of
fractional interests
in SouthTrust
Shares.
Not later than three business days after
the Effective Time of
the Merger, the
Exchange Agent shall send or cause to be
sent to each former holder of record of
FloridaFirst Shares transmittal
materials (the "Letter
of Transmittal") for use
in exchanging their certificates formerly
representing
FloridaFirst Shares
for
the consideration provided for in this
Agreement. The Letter of Transmittal will
contain instructions with respect to the
surrender of certificates representing
FloridaFirst Shares and the receipt of the
consideration
contemplated by
this
Agreement and will require each holder of
FloridaFirst
Shares to transfer
good
and marketable title to such FloridaFirst
Shares to SouthTrust,
free and clear
of all liens, claims and encumbrances.
(b) At the Effective
Time of the Merger,
the stock transfer
books of
FloridaFirst shall be closed as to holders of
FloridaFirst Shares
immediately
prior to the Effective Time of the Merger
and no transfer of FloridaFirst Shares
by any such holder shall thereafter be made or recognized
and each
outstanding
certificate formerly representing
FloridaFirst Shares
shall, without any action
on the part of any holder thereof, no
longer represent
FloridaFirst Shares. If,
after the Effective Time of the Merger,
certificates are
properly presented
to
the Exchange Agent, such certificates shall be exchanged for the
consideration
contemplated by this Agreement into which FloridaFirst Shares represented
thereby were converted in the Merger.
(c) In the event that any holder of record as of the Effective
Time of
the Merger of FloridaFirst Shares is unable to deliver the
certificate
which
represents such holder's FloridaFirst Shares, SouthTrust, in the absence of
actual notice that any FloridaFirst
Shares theretofore
represented by any
such
certificate have been acquired by a bona
fide purchaser,
7
<PAGE>
may, in its discretion, deliver to such
holder the consideration contemplated by
this Agreement and the amount of cash
representing
fractional SouthTrust Shares
to which such holder is entitled in accordance with the provisions of this
Agreement upon the presentation of all of
the following:
(i) An affidavit or
other evidence to the reasonable satisfaction of
SouthTrust
that any such
certificate has been
lost, wrongfully
taken or
destroyed;
(ii) Such security or
indemnity as may be reasonably requested by
SouthTrust
to indemnify
and hold SouthTrust harmless in respect of such
stock
certificate(s); and
(iii) Evidence to the satisfaction of SouthTrust that such holder is
the owner of FloridaFirst Shares theretofore represented by each
certificate
claimed by such holder to be lost, wrongfully taken or
destroyed
and that such
holder is the
person who would be entitled to
present each such certificate for
exchange pursuant to this Agreement.
(d) In the event that the delivery of the consideration
contemplated by
this Agreement and the amount of cash
representing
fractional SouthTrust Shares
are to be made to a person other than the person in whose
name any
certificate
representing FloridaFirst Shares
surrendered is registered, such certificate so
surrendered shall be properly endorsed (or accompanied by an appropriate
instrument of transfer), with the signature(s) appropriately guaranteed, and
otherwise in proper form for transfer,
and the person
requesting such
delivery
shall pay any transfer or other taxes
required by reason of
the delivery to a
person other than the registered holder of such certificate surrendered or
establish to the satisfaction of SouthTrust that such tax has been paid or
is
not applicable.
(e) No holder of
FloridaFirst Shares
shall be entitled to receive any
dividends or distributions declared or made with respect to the SouthTrust
Shares with a record date before the
Effective Time of the
Merger. Neither
the
consideration contemplated by this Agreement,
any amount of cash
representing
fractional SouthTrust Shares nor any
dividend or other distribution with respect
to SouthTrust Shares where the record date
thereof is on or after the Effective
Time of the Merger shall be paid to the
holder of any unsurrendered certificate
or certificates representing FloridaFirst Shares, and SouthTrust shall not
be
obligated to deliver any of the
consideration
contemplated
by this Agreement,
any amount of cash representing fractional SouthTrust Shares or any such
dividend or other distribution with respect to SouthTrust Shares until such
holder shall surrender the certificate or
certificates representing FloridaFirst
Shares as provided for by the Agreement.
Subject to applicable
laws, following
surrender of any such certificate or certificates, there shall be paid to the
holder of the certificate or certificates
then representing SouthTrust Shares
issued in the Merger, without interest at the time of such surrender, the
consideration contemplated by this Agreement, the amount of any cash
representing fractional SouthTrust Shares and the amount of any
dividends or
other distributions with respect to SouthTrust
Shares to which such
holder is
entitled as a holder of SouthTrust
Shares.
8
<PAGE>
Section 2.5 Laws of
Escheat. (a) If any of the consideration due
---------------
or other payments to be paid or delivered
to the holders of FloridaFirst Shares
is not paid or delivered within the time
period specified by any applicable laws
concerning abandoned property, escheat or similar laws, and if
such failure to
pay or deliver such consideration occurs or arises out of the fact
that such
property is not claimed by the proper owner
thereof, SouthTrust or
the Exchange
Agent shall be entitled to dispose of any
such consideration
or other payments
in accordance with applicable laws
concerning
abandoned property, escheat or
similar laws. Any other provision of this Agreement
notwithstanding,
none of
FloridaFirst, SouthTrust, ST-Sub, the
Exchange Agent, or any other Person acting
on their behalf shall be liable to a holder of FloridaFirst Shares for any
amount paid or property delivered in good
faith to a public official pursuant to
and in accordance with any applicable abandoned property, escheat or similar
law.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF FLORIDAFIRST
FloridaFirst and FF-Bank hereby jointly and
severally represent
and warrant to
ST-Sub and SouthTrust as follows as of the
date hereof and as of all times up to
and including the Effective Time of the
Merger (except as otherwise provided):
Section 3.1 Corporate Organization.
----------------------
(a) FloridaFirst is a corporation duly organized, validly existing and
in good standing under the laws of the State of
Florida. FloridaFirst
has the
corporate power and authority to own or
lease all of its
properties and assets
and to carry on its business as such business is now being conducted, and is
duly licensed or qualified to do business
in all such places where the nature of
the business conducted by it or the character
or location of the properties and
assets owned or leased by it make such
qualification necessary, except where the
failure to be so licensed or qualified
would not have a Material Adverse Effect
(as defined herein) on the business,
assets, operations,
financial condition or
results of operations (such business,
assets, operations, financial condition or
results of operations hereinafter collectively referred to as the
"Condition")
of FloridaFirst on a consolidated
basis. FloridaFirst is duly registered as
a
unitary savings and loan holding company under the Home Owners' Loan Act of
1933, as amended. True and correct copies of the
Articles of Incorporation and
the Bylaws of FloridaFirst, each as amended to the date hereof, have been
delivered to SouthTrust.
(b) FF-Bank is a federal savings bank, duly organized, validly
existing
and in good standing under the laws of the United States. FF-Bank has the
corporate power and authority to own or
lease all of its
properties and assets
and to carry on its business as such business is now being conducted, and
FF-Bank is duly licensed or qualified to do business in each
jurisdiction
in
which the nature of the business conducted
by it or the character or location of
the properties and assets leased by it makes such
licensing or
qualification
necessary, except where the failure to be so
licensed or qualified
would not
have a Material Adverse Effect on FF-Bank. True and correct copies of the
Federal Stock Charter and the Bylaws of
FF-Bank, each as amended to the date
hereof, have been delivered to
SouthTrust.
FF-Bank is a member of
the Federal
Home Loan Bank of Atlanta and owns the
requisite amount of stock therein.
9
<PAGE>
(c) The only subsidiary of FloridaFirst is FF-Bank. FF-Bank does not
have any subsidiaries.
(d) Each of FloridaFirst and FF-Bank has in effect all federal,
state,
local and foreign governmental, regulatory
and other authorizations, permits and
licenses necessary for each of them to own
or lease its
properties and
assets
and to carry on its business as now conducted, the absence of which, either
individually or in the aggregate, would have a Material Adverse Effect on the
Condition of FloridaFirst on a consolidated
basis.
(e) Schedule 3.1(e) lists all entities (whether corporations, limited
liability companies, partnerships or similar organizations) of FloridaFirst
(other than FF-Bank) and FF-Bank, including the corresponding percentage
ownership, in which FloridaFirst or FF-Bank,
as appropriate, owns,
directly or
indirectly, five percent (5%) or more of the
ownership interests as of the date
of this Agreement and indicates for each
as of such date, its
jurisdiction of
organization and the jurisdiction(s)
wherein it is qualified to do business. All
of such ownership interests are in compliance with
all applicable laws,
rules
and regulations relating to direct
investment in equity ownership interests.
(f) The minute books of FloridaFirst and FF-Bank contain complete and
accurate records in all material
respects of all
meetings and other
corporate
actions held or taken by their respective shareholders and Boards of
Directors
(including all committees thereof).
Section 3.2 Capitalization.
--------------
(a) The authorized capital stock of FloridaFirst consists of
80,000,000
FloridaFirst Shares, of which 5,388,276 FloridaFirst Shares are issued and
outstanding as of the date hereof
(170,073 of which are
held in the treasury of
FloridaFirst), and 20,000,000 preferred shares, no par value per share
("FloridaFirst Preferred Shares"), of which no
FloridaFirst Preferred Shares as
of the date hereof are issued and
outstanding. All of the issued and outstanding
FloridaFirst Shares have been duly authorized and validly issued and all
such
shares are fully paid and nonassessable. As of the date hereof, there are no
outstanding options, warrants, commitments, or other rights or instruments
to
purchase or acquire any shares of capital stock of FloridaFirst, or any
securities or rights convertible into or exchangeable for shares of capital
stock of FloridaFirst, except for options to purchase 534,799 FloridaFirst
Shares (which are described in more detail
in Schedule 3.2).
(b) The authorized
capital stock of FF-Bank consists of 8,000,000
shares of common stock, par value of $0.10
per share, 100,000 shares of which of
the date hereof are issued and outstanding (none of which is held in the
treasury of FF-Bank) (the "FF-Bank Shares") and 2,000,000
shares of
preferred
stock, no par value per share of which no
shares are issued and
outstanding as
of the date hereof. All of the issued and outstanding
FF-Bank Shares have
been
duly authorized and validly issued and all such shares are fully paid and
nonassessable. As of the date hereof, there are no outstanding options,
warrants, commitments or other rights or
instruments to purchase or acquire any
shares of capital stock of FF-Bank, or any
securities or rights convertible into
or exchangeable for shares of capital stock
of FF-Bank.
10
<PAGE>
(c) All of the issued
and outstanding shares of capital stock of
FF-Bank:
(i) are owned by
FloridaFirst; and
(ii) are so owned free
and clear of all liens
and encumbrances
and adverse claims thereto.
Section 3.3 Financial Statements; Filings.
-----------------------------
(a) FloridaFirst has previously delivered to SouthTrust
copies of the
financial statements of FloridaFirst as of
and for the years ended September 30,
2003, September 30, 2002 and September
30, 2001, and FloridaFirst shall deliver
to SouthTrust, as soon as practicable
following the
preparation of
additional
financial statements for each subsequent
calendar quarter (or other reporting
period) or year of FloridaFirst, the additional consolidated financial
statements of FloridaFirst as of and for
such subsequent
calendar quarter (or
other reporting period) or year (such financial
statements,
unless otherwise
indicated, being hereinafter referred to collectively as the "Financial
Statements of FloridaFirst").
(b) FloridaFirst has previously delivered to SouthTrust
copies of the
Thrift Financial Reports of FF-Bank as of and for
each of the calendar quarters
in the years ended September 30, 2003, September 30, 2002 and September 30,
2001, and FF-Bank and FloridaFirst shall deliver to SouthTrust, as soon as
practicable following the preparation of
additional Thrift Financial Reports for
each subsequent calendar quarter (or other reporting period), the Thrift
Financial Reports of FF-Bank as of and for
such subsequent
calendar quarter (or
other reporting period) (such Thrift Financial Reports, unless otherwise
indicated, being hereinafter referred to collectively as the "Financial
Regulatory Reports of FF-Bank").
(c) Each of the Financial Statements of FloridaFirst and each of the
Financial Regulatory Reports of FF-Bank (including the related
notes, where
applicable) have been or will be prepared
in all material respects in accordance
with generally accepted accounting principles or regulatory accounting
principles, whichever is applicable, which principles have been or will be
consistently applied during the periods involved, except as otherwise noted
therein, and the books and records of
FloridaFirst
and FF-Bank have been,
are
being, and will be maintained in all material respects in accordance with
applicable legal and accounting requirements and reflect only actual
transactions. Each of the Financial Statements of FloridaFirst and
each of the
Financial Regulatory Reports of FF-Bank (including the related
notes, where
applicable) fairly present or will fairly
present the
financial position of
FloridaFirst on a consolidated basis, as
applicable, and the
financial position
of FF-Bank (as the case may be) as of the
respective
dates thereof and fairly
present or will fairly present the results of operations
of FloridaFirst
on a
consolidated basis, as applicable,
and the results of
operations of FF-Bank (as
the case may be) for the respective periods
therein set forth.
(d) To the extent not
prohibited by law,
FloridaFirst has
heretofore
delivered or made available, or caused to be delivered or made
available,
to
SouthTrust all reports and filings made or
required to be made by
FloridaFirst,
FF-Bank or any of their respective
subsidiaries with the Regulatory Authorities,
and will from time to time hereafter furnish, or
11
<PAGE>
cause FF-Bank to furnish to SouthTrust, upon filing or furnishing
the same to
the Regulatory Authorities, all such reports and filings made after the
date
hereof with the Regulatory Authorities. As of the respective dates of such
reports and filings, all such reports and filings did
not and shall not contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the
statements therein,
in
light of the circumstances under which they
were made, not misleading.
(e) Except as set forth in Schedule 3.3(e), since September 30, 2003,
none of FloridaFirst, FF-Bank or any of their respective subsidiaries has
incurred any obligation or liability
(contingent or otherwise) that has or might
reasonably be expected to have,
individually
or in the aggregate, a Material
Adverse Effect on the Condition of
FloridaFirst on a consolidated basis, except
obligations and liabilities (i) which are accrued or reserved
against in the
Financial Statements of FloridaFirst or the Financial Regulatory Reports of
FF-Bank, or reflected in the notes
thereto, or (ii) which were incurred
after
September 30, 2003, in the ordinary course of business consistent with past
practices. Since September 30, 2003, neither FloridaFirst nor FF-Bank has
incurred or paid any obligation or liability which would be material to the
Condition of FloridaFirst on a consolidated basis, except as may have been
incurred or paid in the ordinary course of business, consistent with past
practices.
Section 3.4 Loan Portfolio; Reserves. Except as set forth in
Schedule
-------------------------
3.4, (i) all evidences of indebtedness in
original principal amount in excess of
$100,000 reflected as assets in the
Financial Statements
of FloridaFirst as of
and for the year ended September 30, 2003
and the Financial
Regulatory Reports
of FF-Bank as of and for the quarter
ended September 30, 2003 were as of such
dates in all respects the binding
obligations of the
respective obligors
named
therein in accordance with their
respective
terms, and were not
subject to any
defenses, setoffs, or counterclaims, except as may be provided by
bankruptcy,
insolvency or similar laws or by general principles of equity; and (ii) the
allowances for possible loan losses shown on the Financial Statements of
FloridaFirst as of and for the year ended
September 30, 2003 and
the Financial
Regulatory Reports of FF-Bank as of and for
the quarter ended September 30, 2003
were, and the allowance for possible loan losses to be
shown on the Financial
Statements of FloridaFirst and the
Financial Regulatory Reports of FF-Bank as of
any date subsequent to the execution of this Agreement will be, as of such
dates, adequate under and established in accordance
with the requirements of
generally accepted accounting principles and applicable
regulatory
accounting
principles.
Section 3.5 Certain Loans and Related Matters. Except as set forth in
----------------------------------
Schedule 3.5, neither FloridaFirst nor FF-Bank is a party to any written
or
oral: (i) loan agreement, note or borrowing
arrangement, other
than credit card
loans and other loans the unpaid
balance of which does
not exceed $100,000
per
loan, under the terms of which the
obligor is sixty (60) days delinquent in
payment of principal or interest or, to the knowledge of FloridaFirst and
FF-Bank, in default of any other
provision as of the date hereof; (ii) loan
agreement, note or borrowing arrangement which has been classified or, in
the
exercise of reasonable diligence by FloridaFirst, FF-Bank or any Regulatory
Authority, should have been classified by any
bank examiner (whether regulatory
or internal) as "substandard," "doubtful," "loss," "other loans especially
mentioned," "other assets especially
mentioned," "special mention," "credit risk
assets,"
12
<PAGE>
"classified," "criticized," "watch list," "concerned loans" or any
comparable
classifications by such persons; (iii) loan agreement, note or borrowing
arrangement, including any loan guaranty,
with any director or executive officer
of FloridaFirst or FF-Bank or any five
percent (5%)
shareholder of FloridaFirst
or FF-Bank, or any person, corporation or
enterprise controlling, controlled by
or under common control with any of the
foregoing; or (iv) loan agreement, note
or borrowing arrangement in violation of any
law, regulation or rule applicable
to FloridaFirst or FF-Bank including, but not limited to, those
promulgated,
interpreted or enforced by any Regulatory
Authority and which
violation could
have a Material Adverse Effect on the Condition of FloridaFirst on a
consolidated basis.
Section 3.6 Authority; No Violation.
-----------------------
(a) FloridaFirst has
full corporate power and authority to execute and
deliver this Agreement and, subject to the approval of the
shareholders
of
FloridaFirst and to the receipt of the Consents
of the Regulatory
Authorities,
to consummate the transactions contemplated hereby. The OTS regulatory
prohibition regarding acquiring or offering to acquire more than 10% of the
capital stock of FloridaFirst within the
three-year period following conversion
by FloridaFirst from mutual to stock form has
expired and does not limit or
restrict the transactions contemplated by
this Agreement. The Board of Directors
of FloridaFirst has duly and validly approved this Agreement and the
transactions contemplated hereby, has authorized the
execution and delivery of
this Agreement, has directed that this Agreement and the transactions
contemplated hereby be submitted to
FloridaFirst's
shareholders for approval at
a meeting of such shareholders and, except
for the adoption of such Agreement by
its shareholders and the execution and filing of
Articles of Merger, no
other
corporate proceeding on the part of
FloridaFirst is necessary to consummate the
transactions so contemplated. This Agreement, when duly and
validly executed by
FloridaFirst and delivered by FloridaFirst (and assuming due authorization,
execution and delivery by SouthTrust
and ST-Sub),
will constitute a valid and
binding obligation of FloridaFirst, and
will be enforceable against FloridaFirst
in accordance with its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency,
reorganization,
moratorium,
receivership or
similar laws affecting the enforcement of
creditors' rights generally and except
that the availability of the equitable remedy of specific performance or
injunctive relief is subject to the
discretion
of the court
before which any
proceeding may be brought.
(b) Neither
the execution and delivery of this Agreement by
FloridaFirst nor the consummation by FloridaFirst of the transactions
contemplated hereby, nor compliance by FloridaFirst with any of the terms or
provisions hereof, will (i) violate any provision of the Articles of
Incorporation or Bylaws of FloridaFirst,
(ii) to FloridaFirst's knowledge and
assuming that the Consents of the
Regulatory Authorities
and approvals referred
to herein are duly obtained, violate any statute, code, ordinance, rule,
regulation, judgment, order, writ, decree or injunction applicable to
FloridaFirst, FF-Bank or any of their respective
properties or assets, or (iii)
violate, conflict with, result in a breach of any
provisions of,
constitute a
default (or an event which, with notice or lapse of time, or both, would
constitute a default) under, result in the termination of, accelerate the
performance required by or result in the creation of any lien, security
interest, charge or other encumbrance upon
any of the respective
properties or
assets of
13
<PAGE>
FloridaFirst or FF-Bank under, any of the
terms, conditions or provisions of any
material note, bond, mortgage, indenture,
deed of trust, license, permit, lease,
agreement or other instrument or obligation
to which FloridaFirst
or FF-Bank is
a party, or by which any of them or any of
their respective properties or assets
may be bound or affected.
Section 3.7 Consents and Approvals. Except for (i) the approval of
the
----------------------
shareholders of FloridaFirst pursuant to the proxy statement of FloridaFirst
relating to the meeting of the shareholders of FloridaFirst at
which the Merger
is to be considered (the "Proxy
Statement"); (ii) the Consents of the Regulatory
Authorities; (iii) the filing of Articles of Merger with the States
of Alabama
and Florida; and (iv) as set forth in Schedule
3.7, no Consents of
any person
are necessary in connection with the execution and delivery by
FloridaFirst of
this Agreement, and the consummation of the Merger and the
other transactions
contemplated hereby.
Section 3.8 Broker's
Fees. Except for Sandler, O'Neill & Partners,
---------------
L.P., whose engagement letter is set forth in Schedule 3.8, neither of
FloridaFirst or FF-Bank, nor any of their
respective officers or directors, has
employed any broker or finder or incurred
any liability for any
broker's fees,
commissions or finder's fees in connection with any of the transactions
contemplated by this Agreement.
Section 3.9 Absence of Certain Changes or Events. Except as set forth
-------------------------------------
in Schedule 3.9, since September 30, 2003, there has not been (a) any
declaration, payment or setting aside of any
dividend or distribution (whether
in cash, stock or property) in respect of
FloridaFirst Shares or
(b) any change
or any event involving a prospective
change in the
Condition of FloridaFirst on
a consolidated basis, or a combination of any such change(s) and any such
event(s) which has had, or is reasonably likely to have, a Material Adverse
Effect on the Condition of FloridaFirst on a consolidated basis, including,
without limitation any change in the
administration or
supervisory standing
or
rating of FloridaFirst or FF-Bank with any
Regulatory Authority,
and no fact or
condition exists as of the date hereof
which might
reasonably
be expected to
cause any such event or change in the
future.
Section 3.10 Legal
Proceedings; Etc.
Except as set forth in
Schedule
------------------------
3.10, neither of FloridaFirst or FF-Bank is a party to any,
and there are no
pending or, to the knowledge of
FloridaFirst and each
FloridaFirst
subsidiary,
threatened, judicial, administrative, arbitral or other proceedings,
claims,
actions, causes of action or governmental
investigations against FloridaFirst or
FF-Bank challenging the validity of the transactions contemplated by this
Agreement and, to the knowledge of FloridaFirst and FF-Bank as of the date
hereof, there is no proceeding,
claim, action or governmental investigation
against FloridaFirst or FF-Bank; no
judgment, decree, injunction, rule or order
of any court, governmental department,
commission,
agency, instrumentality or
arbitrator is outstanding against FloridaFirst or FF-Bank which has
had, or is
reasonably likely to have, a Material Adverse Effect on the Condition of
FloridaFirst on a consolidated basis; there is no default by
FloridaFirst or
FF-Bank under any material contract or agreement to which FloridaFirst or
FF-Bank is a party which has had or is reasonably likely to have a Material
Adverse Effect on the Condition of
FloridaFirst on a consolidated basis.
14
<PAGE>
Section 3.11 Taxes and Tax Returns.
---------------------
(a) FloridaFirst
has previously delivered or made available to
SouthTrust copies of the federal, state and local income tax returns of
FloridaFirst and, if consolidated returns do not exist for all
periods, of
FF-Bank and each of its respective
subsidiaries,
for the years 2001,
2002 and
2003 and all schedules and exhibits thereto, and, except as disclosed in
Schedule 3.11, such returns have not been examined by the Internal Revenue
Service or any other taxing authority. Except as reflected in Schedule 3.11,
FloridaFirst and FF-Bank have duly filed in
correct form all federal, state and
local information returns and tax returns
required to be filed
on or prior to
the date hereof, and FloridaFirst and FF-Bank have duly paid or made
adequate
provisions for the payment of all taxes and
other governmental charges which are
owed by FloridaFirst and FF-Bank to any federal, state or local taxing
authorities, whether or not reflected in such returns (including, without
limitation, those owed in respect of the
properties, income,
business, capital
stock, deposits, franchises, licenses, sales and payrolls of FloridaFirst
and
FF-Bank), other than taxes and other
charges which (i) are not yet delinquent or
are being contested in good faith or (ii)
have not been finally determined. The
amounts set forth as liabilities for taxes on the Financial Statements of
FloridaFirst and the Financial Regulatory
Reports of FF-Bank are sufficient, in
the aggregate, for the payment of all unpaid federal, state and local taxes
(including any interest or penalties
thereon), whether or
not disputed, accrued
or applicable, for the periods then ended, and
have been computed in accordance
with generally accepted accounting
principles. Neither
FloridaFirst nor FF-Bank
is responsible for the taxes of any other
person other than
FloridaFirst
or
FF-Bank, under Treasury Regulation 1.1502-6
or any similar provision of federal,
state or foreign law.
(b) Except as
disclosed in Schedule
3.11, neither
FloridaFirst
nor
FF-Bank has executed an extension or waiver
of any statute of limitations on the
assessment or collection of any federal, state or local taxes due that is
currently in effect, and deferred taxes of FloridaFirst
or FF-Bank,
have been
adequately provided for in the Financial
Statements of FloridaFirst.
(c) Except as
disclosed in Schedule
3.11, neither
FloridaFirst
nor
FF-Bank has made any payment, is obligated to make any payment
or is a party to
any contract, agreement or other arrangement
that could obligate it to make any
payment that would be disallowed as a
deduction under
Section 280G or 162(m) of
the Code.
(d) There has not been an ownership change, as defined in Section
382(g) of the Code, of FloridaFirst or
FF-Bank that occurred during or after any
taxable period in which FloridaFirst or FF-Bank incurred
an operating loss that
carries over to any taxable period ending
after the fiscal year of FloridaFirst
immediately preceding the date of this
Agreement.
(e) (i) Proper and accurate amounts have been withheld by
FloridaFirst
and FF-Bank from their employees and others for all prior
periods in compliance
in all material respects with the tax withholding
provisions of all
applicable
federal, state and local laws and
regulations,
and proper due
diligence steps
have been taken in connection with back-up
withholding; (ii)
federal, state and
local returns have been filed by
FloridaFirst
and FF-Bank for all
periods for
which returns were due with respect to withholding, Social Security and
unemployment taxes or charges due to any federal, state or local taxing
authority; and (iii) the
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amounts shown on such returns to be due and payable
have been paid in full
or
adequate provision therefor have been
included by either FloridaFirst or FF-Bank
in the Financial Statements of
FloridaFirst.
Section 3.12 Employee Benefit Plans.
----------------------
(a) Neither
FloridaFirst
nor FF-Bank or any of their respective
subsidiaries has or maintains any "employee
benefit plan," as defined in Section
3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), except as described in Schedule 3.12(a) (the "Employee Benefit
Plans"). FloridaFirst and FF-Bank and their
respective
subsidiaries have, with
respect to each such plan, delivered to SouthTrust true and
complete copies of:
(i) all current plan texts and agreements and related trust agreements or
annuity contracts and any amendments thereto; (ii) all current summary plan
descriptions and material employee
communications; (iii)
the Form 5500 filed in
each of the most recent three plan years
(including
all schedules
thereto and
the opinions of independent accountants); (iv) the most recent actuarial
valuation (if any); (v) the most recent annual and
periodic accounting of
plan
assets; (vi) if the plan is intended to
qualify under Section
401(a) or 403(a)
of the Code, the most recent determination letter received from the Internal
Revenue Service; and (vii) all material
communications
with any
governmental
entity or agency (including, without limitation, the Department of Labor,
Internal Revenue Service and the Pension
Benefit Guaranty Corporation ("PBGC")).
(b) Except as described in Schedule 3.12(b), no Employee Benefit Plan
is a defined benefit plan. Neither
FloridaFirst nor FF-Bank (or any pension plan
maintained by either of them) has
incurred any liability to the PBGC or the
Internal Revenue Service with respect to any pension
plan qualified under
Section 401 of the Code, except liabilities
to the PBGC pursuant to Section 4007
of ERISA, all which have been fully paid.
No reportable event under Section
4043(b) of ERISA (including events waived by PBGC regulation)
has occurred with
respect to any such pension plan.
(c) Neither
FloridaFirst
nor FF-Bank has incurred any material
liability under Section 4201 of ERISA for a
complete or partial withdrawal from,
or agreed to participate in, any
multi-employer plan as
such term is defined in
Section 3(37) of ERISA.
(d) All Employee Benefit Plans comply, in all material respects, with
the applicable provisions of ERISA and the Code that are
applicable to
them,
including, but not limited to, COBRA,
HIPAA and any
applicable, similar
state
law. Neither FloridaFirst nor FF-Bank has any
material liability under any such
plan that is not reflected in the Financial
Statements of
FloridaFirst
or the
Financial Regulatory Reports of
FloridaFirst and FF-Bank. Neither FloridaFirst,
FF-Bank, any Employee Benefit Plan nor any employee, administrator or agent
thereof, is or has been in violation of the transaction code set rules under
HIPAA ss.ss. 1172-1174 or the HIPAA privacy rules under 45 CFR Part 160
and
subparts A and E of Part 164. No penalties
have been imposed on FloridaFirst,
FF-Bank, any Employee Benefit Plan, or any employee, administrator or agent
thereof, under HIPAA ss. 1176 or ss.
1177.
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<PAGE>
For purposes of this Agreement, "COBRA" means the provision of
Section
4980B of the Code and the regulations
thereunder,
and Part 6 of the
Subtitle B
of title I of ERISA and any regulations thereunder, and "HIPAA" means the
provisions of the Code and ERISA as enacted
by the Health Insurance Portability
and Accountability Act of 1996.
(e) No prohibited transaction (which shall mean any transaction
prohibited by Section 406 of ERISA and not
exempt under
Section 408 of
ERISA)
has occurred with respect to any Employee
Benefit Plan (i) which would result in
the imposition, directly or indirectly,
of a material excise
tax under Section
4975 of the Code or a material civil
penalty under Section
502(i) of ERISA,
or
(ii) the correction of which would have a Material Adverse Effect on the
Condition of FloridaFirst on a consolidated basis and no actions have
occurred
which could result in the imposition of a
penalty under any section or provision
of ERISA.
(f) No Employee
Benefit Plan which is a defined benefit pension plan
has any "unfunded current liability," as that term is defined in Section
302(d)(8)(A) of ERISA, and the present fair market value of the assets of
any
such plan exceeds the plan's "benefit
liabilities,"
as that term is
defined in
Section 4001(a)(16) of ERISA, when
determined under actuarial factors that would
apply if the plan terminated in accordance with all applicable legal
requirements.
(g) Except as described in Schedule 3.12(g), neither the execution and
delivery of this Agreement nor the
consummation of the transactions contemplated
hereby will (i) result in any material
payment (including,
without
limitation,
severance, unemployment compensation, golden parachute or otherwise)
becoming
due to any director or any officer or
employee of
FloridaFirst or FF-Bank under
any Employee Benefit Plan or otherwise,
(ii) materially
increase any
benefits
otherwise payable under any benefit plan or
(iii) result in any acceleration of
the time of payment or vesting of any such
benefits to any material extent.
(h) No Employee
Benefit Plan is a multiemployer plan as defined in
Section 414(f) of the Code or Section 3(37)
or 4001(a)(3) of ERISA. FloridaFirst
and FF-Bank have never been a party to or
participant in a multiemployer plan.
(i) There are no
actions, liens,
suits or claims
pending or, to the
knowledge of FloridaFirst, threatened (other than routine claims for
benefits)
with respect to any Employee Benefit Plan or against the assets
of any Employee
Benefit Plan. No assets of FloridaFirst or
FF-Bank are subject to any lien under
Section 302(f) of ERISA or Section 412(n)
of the Code.
(j) Each Employee
Benefit Plan which is intended to qualify under
Section 401(a) or 403(a) of the Code has
received a favorable determination
letter from the Internal Revenue Service to the effect that
it so qualifies and
its related trust is exempt from taxation
under Section
501(a) of the Code.
No
event has occurred or circumstance exists that will or could give rise to
a
disqualification or loss of tax-exempt
status of any such plan or trust.
(k) No Employee
Benefit Plan is a
multiple employer
plan within the
meaning of Section 413(c) of the Code or
Section 4063, 4064 or 4066 of ERISA. No
Employee Benefit Plan is a multiple
employer welfare
arrangement as defined
in
Section 3(40) of ERISA.
17
<PAGE>
(l) Each employee
pension benefit plan,
as defined in Section 3(2) of
ERISA , that is not qualified under Section 401(a) or 403(a) of the Code is
exempt from Part 2, 3 and 4 of Title I of
ERISA as an unfunded
plan that is
maintained primarily for the purpose of
providing deferred
compensation for a
select group of management or highly
compensated employees,
pursuant to Section
201(2), 301(a)(3) and 401(a)(1) of ERISA.
No assets of
FloridaFirst or FF-Bank
are allocated to or held in a "rabbi trust"
or similar funding vehicle.
(m) Except as set forth on Schedule 3.12(m), no Employee Benefit Plan
provides benefits to any current or former
employee of
FloridaFirst or FF-Bank
beyond retirement or other termination of
service (other than coverage mandated
by COBRA, the cost of which is fully paid by
the current or former
employee or
his or her dependents).
(n) Except as set
forth on Schedule
3.12(n), with respect to each
Employee Benefit Plan, there are no funded benefit obligations for which
contributions have not been made or properly
accrued and there are
no unfunded
benefit obligations that have not been accounted for by reserves or
otherwise
shown in the footnotes in accordance with generally accepted accounting
principles to the Financial Statements of
FloridaFirst.
Section 3.13 Title and Related Matters.
-------------------------
(a) Except as set forth in Schedule 3.13, each of FloridaFirst,
FF-Bank
and their respective subsidiaries has good
title, and as to owned real property,
has good and marketable title in fee simple absolute, to all assets and
properties, real or personal, tangible or intangible,
reflected as owned by
or
leased or subleased by or carried under the
name of any of them on the Financial
Statements of FloridaFirst, or the Financial Regulatory Reports of FF-Bank or
acquired subsequent thereto (except to the extent that such assets and
properties have been disposed of for fair value in the ordinary course of
business since September 30, 2003),
free and clear of all
liens,
encumbrances,
mortgages, security interests, restrictions, pledges or claims, except for
(i)
those liens, encumbrances, mortgages, security interests,
restrictions, pledges
or claims reflected in the Financial Statements of FloridaFirst, and the
Financial Regulatory Reports of FF-Bank or incurred in
the ordinary course
of
business after September 30, 2003, (ii) statutory liens for amounts not yet
delinquent or which are being contested in good faith, and (iii) liens,
encumbrances, mortgages, security interests, pledges, claims and title
imperfections that are not in the aggregate material to the Condition of
FloridaFirst on a consolidated basis.
(b) All agreements
pursuant to which
FloridaFirst, FF-Bank
or any of
their respective subsidiaries leases, subleases or licenses material real or
material personal properties from others are valid,
binding and
enforceable in
accordance with their respective terms, and there is not, under any of such
leases or licenses, any existing default or
event of default, or any event which
with notice or lapse of time,
or both, would constitute a default or force
majeure, or provide the basis for any other claim of excusable delay or
nonperformance, except for defaults which
individually or in the aggregate would
not have a Material Adverse Effect on the Condition of FloridaFirst on a
consolidated basis. Except as set forth in Schedule
3.13(b), FloridaFirst
and
FF-Bank have all right, title and interest as a lessee
under the terms of each
lease or sublease, free and clear of all liens,
claims or encumbrances
(other
than the rights of the
18
<PAGE>
lessor) as of the Effective Time of the Merger, and shall have the right to
transfer each lease or sublease pursuant to
this Agreement.
(c) Other than real estate that was acquired by foreclosure or
voluntary deed in lieu of foreclosure
(i) all of the
buildings, structures
and
fixtures owned, leased or subleased by FloridaFirst, FF-Bank and their
respective subsidiaries are in good
operating condition and repair, subject only
to ordinary wear and tear and/or minor
defects which do not
interfere with the
continued use thereof in the conduct of
normal operations,
and (ii) all of
the
material personal properties owned, leased
or subleased by FloridaFirst, FF-Bank
and their respective subsidiaries are in good operating condition and repair,
subject only to ordinary wear and tear and/or minor defects which do not
interfere with the continued use thereof in
the conduct of normal operations.
Section 3.14 Real Estate.
-----------
(a) Schedule 3.14(a)
identifies each parcel of real estate or interest
therein owned, leased or subleased by
FloridaFirst, FF-Bank
or their respective
subsidiaries or in which FloridaFirst,
FF-Bank or their
respective subsidiaries
has any ownership or leasehold
interest.
(b) Schedule
3.14(b) lists or otherwise describes each and every
written or oral lease or sublease,
together with the
current name, address
and
telephone number of the landlord or
sublandlord
and the landlord's property
manager (if any), under which FloridaFirst or FF-Bank is the
lessee of any real
property and which relates in any manner to
the operation of the
businesses of
FloridaFirst or FF-Bank.
(c) To the knowledge of FloridaFirst, neither FloridaFirst nor
FF-Bank
has violated, or is currently in violation of,
any law, regulation or ordinance
relating to the ownership or use of the real estate and real
estate interests
described in Schedules 3.14(a) and 3.14(b) including, but not limited to any
law, regulation or ordinance relating to zoning, building, occupancy,
environmental or comparable matter which
individually or in the
aggregate would
have a Material Adverse Effect on the Condition of FloridaFirst on a
consolidated basis.
(d) As to each parcel of real property owned or used by FloridaFirst,
FF-Bank or any of
