Exhibit 2.1
AGREEMENT AND PLAN OF
MERGER
AMONG
LANDMARK BANCORP,
INC.
MANHATTAN ACQUISITION
CORPORATION
AND
FIRST MANHATTAN BANCORPORATION,
INC.
SEPTEMBER 6,
2005
TABLE OF
CONTENTS
i
ii
iii
iv
EXHIBIT INDEX
|
A
|
Form of Legal Opinion of Counsel to First
Manhattan
|
|
B
|
Form of Voting Agreement
|
|
C
|
Form of Non-Competition
Agreement
|
|
D
|
Form of First Manhattan Stockholder
Release
|
SCHEDULE INDEX
|
3.1(a)
|
|
Description of
Loan
|
|
4.1
|
|
First Manhattan Organization
|
|
4.2
|
|
First Manhattan Subsidiary
Organization
|
|
4.4
|
|
No Conflict
|
|
4.5
|
|
First Manhattan Capitalization
|
|
4.6
|
|
First Manhattan Subsidiary
Capitalization
|
|
4.7
|
|
Financial Statements and Reports
|
|
4.9
|
|
Title to Properties
|
|
4.11
|
|
Loans
|
|
4.12
|
|
Investments
|
|
4.13
|
|
Undisclosed Liabilities; Adverse
Changes
|
|
4.15
|
|
Compliance with ERISA
|
|
4.17
|
|
Legal Proceedings; Orders
|
|
4.18
|
|
Absence of Certain Changes and Events
|
|
4.19
|
|
Properties, Contracts and Employee Benefit
Plans
|
|
4.20
|
|
No Defaults
|
|
4.21
|
|
Insurance
|
|
4.22
|
|
Compliance with Environmental Laws
|
|
4.23
|
|
ADA Compliance
|
|
4.24
|
|
Regulatory Filings
|
|
4.26
|
|
Indemnification Claims
|
|
4.27
|
|
Insider Interests
|
|
4.29
|
|
Brokerage Commissions
|
|
6.18
|
|
First Manhattan Debt
|
v
AGREEMENT AND PLAN OF
MERGER
THIS AGREEMENT AND PLAN OF
MERGER (this “
Agreement ”) is entered into as of September 6,
2005 (the “ Agreement Date ”), among LANDMARK
BANCORP, INC., a Delaware corporation (“ Landmark
”), FIRST MANHATTAN BANCORPORATION, INC. , a Kansas
corporation (“ First Manhattan ”), and
MANHATTAN ACQUISITION CORPORATION , a Kansas corporation
(“ Acquisition Corp ”).
RECITALS
A.
Landmark is a registered bank
holding company under the federal Bank Holding Company Act, as
amended (the “ BHCA ”), and First Manhattan is a
registered savings and loan holding company under the Home
Owners’ Loan Act (“ HOLA ”).
B.
Acquisition Corp is a Kansas
corporation formed by Landmark solely for the purpose of
facilitating the transactions contemplated herein.
C.
The parties to this Agreement desire
to effect a reorganization whereby Landmark will acquire control of
First Manhattan through the merger (the “ Merger
”) of Acquisition Corp with and into First Manhattan, with
First Manhattan being the surviving entity as a wholly owned
subsidiary of Landmark (the “ Surviving Corporation
”).
D.
Pursuant to the terms of this
Agreement, each outstanding share of the common stock of First
Manhattan, $10.00 par value per share (“ First Manhattan
Common Stock ”), will be converted at the effective time
of the Merger into the right to receive cash, in the amount and
pursuant to the terms set forth in this Agreement.
E.
The parties desire to make certain
representations, warranties and agreements in connection with the
Merger and also agree to certain prescribed conditions to the
Merger.
AGREEMENTS
In consideration of the foregoing
premises and the following mutual promises, covenants and
agreements, the parties hereby agree as follows:
Article 1
DEFINITIONS
Section 1.1
Definitions
. In
addition to those terms defined throughout this Agreement, the
following terms, when used herein, shall have the following
meanings.
(a)
“
Adjusted Stockholders’
Equity ” means the
consolidated tangible stockholders’ equity of First
Manhattan, calculated in accordance with GAAP, as modified, if
necessary, to:
(i)
include:
(A) the accrued income and expenses (except as set forth
in Section 1.1(a)(ii)
below) of First
Manhattan for all periods ending on or prior to the
Determination Date;
(B) any Remediation Cost, as defined in Section 6.7 ; and (C) except as set
forth in Section 1.1(a)(ii)
below, any
amounts paid or payable to any director, officer or employee of
First Manhattan or any First Manhattan Subsidiary under any
Contract or benefit plan as a result of the Contemplated
Transactions; and
(ii)
exclude:
(A) any adjustments made in accordance with Statement of
Financial Accounting Standard No. 115 (“
SFAS 115 ”); (B) any
realized gains or losses resulting from sales of investment
securities effected by First Manhattan or any First Manhattan
Subsidiary between June 30, 2005, and the Closing Date;
(C) any realized gains on the sale of any branch or on any
other extraordinary sales effected by First Manhattan or any First
Manhattan Subsidiary between June 30, 2005, and the Closing
Date; (D) any amounts paid or payable to Larry R. Heyka under
his existing change in control agreement; (E) the reasonable
fees and expenses of attorneys, accountants and financial advisors
incurred by First Manhattan in connection with this Agreement and
the Contemplated Transactions, provided, however , that only
one-half (½) of the fee paid or payable to Gerald Sprong up to
a maximum of Fifty Thousand Dollars ($50,000), and up to Ten
Thousand Dollars ($10,000) of any such fee paid or payable to David
Kreller, shall be excluded, provided further , that the
balance of any such fees owed to the foregoing individuals is paid
by one or more of the First Manhattan Stockholders; and
(F) any accounting or other adjustments made pursuant
to Section 6.19
.
First Manhattan’s
Adjusted Stockholders’ Equity shall be calculated by First
Manhattan’s auditors, Varney & Associates, in
consultation with Landmark’s auditors, KPMG. For
purposes of Article 3 , Adjusted
Stockholders’ Equity shall be computed as of the close of
business on the Determination Date, and for all other purposes of
this Agreement shall be computed as of the date specified herein,
using in each case reasonable estimates of revenues and expenses
where actual amounts are not available. For purposes of this
calculation, First Manhattan shall assume a tax rate of eighteen
and one-half percent (18½%). Such calculation shall be
subject to verification and approval prior to the Closing (as
defined below) by Landmark’s auditors, which approval shall
not be unreasonably withheld.
(b)
“
Affiliate ” means with respect
to:
(i)
a particular
individual: (A) each other member of such
individual’s Family; (B) any Person that is directly or
indirectly controlled by such individual or one or more members of
such individual’s Family; (C) any Person in which such
individual or members of such individual’s Family hold
(individually or in the aggregate) a Material Interest; and
(D) any Person with respect to which such individual or one or
more members of such individual’s Family serves as a
director, officer, partner, executor or trustee (or in a similar
capacity); and
(ii)
a specified
Person other than an individual: (A) any Person that
directly or indirectly controls, is directly or indirectly
controlled by, or is directly or indirectly under common control
with such specified Person; (B) any Person that holds a
Material Interest in such specified Person; (C) each Person
that serves as a director, officer, partner, executor or trustee of
such specified Person (or in a similar capacity); (D) any
Person in which such specified Person holds a Material Interest;
(E) any Person with respect to which such specified
Person
2
serves as a general partner
or a trustee (or in a similar capacity); and (F) any Affiliate
of any individual described in clauses (B) or (C) of this
subsection (ii).
(c)
“
Bank ” means First Savings
Bank, F.S.B., a federally chartered savings bank with its main
office located in Manhattan, Kansas, and a wholly owned Subsidiary
of First Manhattan.
(d)
“
Best Efforts ” means the efforts
that a prudent Person desirous of achieving a result would use in
similar circumstances to ensure that such result is achieved as
expeditiously as possible, provided, however , that an
obligation to use Best Efforts under this Agreement does not
require the Person subject to that obligation to take actions that
would result in a materially adverse change in the benefits to such
Person (or its Subsidiaries) of this Agreement and the Contemplated
Transactions.
(e)
“
Bank Merger ” means the merger of
the Bank with and into Landmark Bank.
(f)
“
Breach ” means with respect
to a representation, warranty, covenant, obligation or other
provision of this Agreement or any instrument delivered pursuant to
this Agreement any inaccuracy in or breach of, or any failure to
perform or comply with, such representation, warranty, covenant,
obligation or other provision.
(g)
“
Business Day ” means any day on
which the trading of stock occurs on the Nasdaq National Market
System.
(h)
“
Code ” means the Internal
Revenue Code of 1986, as amended.
(i)
“
Contemplated Transactions
” means all
of the transactions contemplated by this Agreement,
including: (i) the Merger; (ii) the performance by
Landmark, Acquisition Corp and First Manhattan of their respective
covenants and obligations under this Agreement;
(iii) Landmark’s acquisition of control of First
Manhattan and, indirectly, the Bank; and (iv) the Bank
Merger.
(j)
“
Contract ” means any agreement,
contract, obligation, promise or understanding (whether written or
oral and whether express or implied) that is legally binding:
(i) under which a Person has or may acquire any rights;
(ii) under which such Person has or may become subject to any
obligation or liability; or (iii) by which such Person or any
of the assets owned or used by such Person is or may become
bound.
(k)
“
CRA ” means the Community
Reinvestment Act, as amended.
(l)
“
Determination Date
” means
the close of business on the last Business Day of the month ending
immediately prior to the month in which the Closing Date
occurs.
(m)
“
ERISA ” means the Employee
Retirement Income Security Act of 1974, as amended.
(n)
“
Exchange Act ” means the Securities
Exchange Act of 1934, as amended.
3
(o)
“
Family ” means with respect
to an individual: (i) the individual; (ii) the
individual’s spouse and former spouses; (iii) any other
natural person who is related to the individual or the
individual’s spouse within the second degree; and
(iv) any other natural person who resides with such
individual.
(p)
“
FDIC ” means the Federal
Deposit Insurance Corporation.
(q)
“
Federal Reserve ” means the Board of
Governors of the Federal Reserve System.
(r)
“
First Manhattan Stockholder
” means a
holder of record of First Manhattan Common Stock.
(s)
“
First Manhattan Subsidiary
” means any
Subsidiary of First Manhattan, including the Bank.
(t)
“
GAAP ” means generally
accepted accounting principles in the United States consistent with
those used in the preparation of the most recent audited
consolidated financial statements of Landmark or First Manhattan,
as the case may be.
(u)
“
Knowledge ” means:
(i)
with respect to
First Manhattan that any of (A) Charles Hostetler, Sue
Sherwood, Sue Hostetler or Cynthia Hostetler is actually aware of
such fact or other matter; or (B) Larry R. Heyka, David J.
Kreller, Richard A. Wertzberger, Stanley F. Watt or Bonnie Lowe is
actually aware of such fact or other matter, or in the exercise of
prudence, that any of the foregoing individuals in this
subparagraph (B) could be expected to discover or
otherwise become aware of such fact or other matter as a result of
their respective positions in the Bank; and
(ii)
with respect to
Landmark that any of (A) Landmark’s directors is
actually aware of such fact or other matter; or (B) any of the
Company’s executive officers is actually aware of such fact
or other matter, or in the exercise of prudence, that any of the
foregoing individuals in this subparagraph (B) could be
expected to discover or otherwise become aware of such fact or
other matter as a result of their respective positions in Landmark
or Landmark Bank; and.
(v)
“
Landmark Bank ” means Landmark
National Bank, a national banking association with its main office
located in Manhattan, Kansas.
(w)
“
Landmark SEC Documents
” means
the annual, quarterly and other reports, schedules, forms,
statements and other documents (including exhibits and all other
information incorporated therein) filed by Landmark with the
SEC.
(x)
“
Legal Requirement
” means
any federal, state, local, municipal, foreign, international,
multinational or other Order, constitution, law, ordinance,
regulation, rule, policy statement, directive, statute or
treaty.
4
(y)
“
Material Adverse Effect
” with
respect to a Person (other than an individual) means, a material
adverse effect (whether or not required to be accrued or disclosed
under Statement of Financial Accounting Standards
No. 5): (i) on the condition (financial or
otherwise), properties, assets, liabilities, businesses or results
of operations of such Person and its Subsidiaries, taken as a
whole; or (ii) on the ability of such Person to perform its
material obligations under this Agreement on a timely basis, but
not including the effect of any change of any Legal Requirement or
economic event affecting financial institutions generally that does
not disproportionately affect such Person.
(z)
“
Material Interest
” means
the direct or indirect beneficial ownership (as currently defined
in Rule 13d-3 under the Exchange Act) of voting securities or
other voting interests representing at least ten percent (10%) of
the outstanding voting power of a Person or equity securities or
other equity interests representing at least ten percent (10%) of
the outstanding equity securities or equity interests in a
Person.
(aa)
“
Merger Consideration
” means
the total cash consideration to be paid to First Manhattan
Stockholders in connection with the Merger.
(bb)
“
OCC ” means the Office of
the Comptroller of the Currency.
(cc)
“
Order ” means any award,
decision, injunction, judgment, order, ruling, extraordinary
supervisory letter, policy statement, memorandum of understanding,
resolution, agreement, directive, subpoena or verdict entered,
issued, made, rendered or required by any court, administrative or
other governmental agency, including any Regulatory Authority, or
by any arbitrator.
(dd)
“
Ordinary Course of Business
” means any
action taken by a Person only if such action:
(i)
is consistent
with the past practices of such Person and is taken in the ordinary
course of the normal day-to-day operations of such
Person;
(ii)
is not required
to be authorized by the board of directors of such Person (or by
any Person or group of Persons exercising similar authority), other
than loan approvals for customers of a financial institution;
and
(iii)
is similar in
nature and magnitude to actions customarily taken, without any
authorization by the board of directors (or by any Person or group
of Persons exercising similar authority), other than loan approvals
for customers of a financial institution, in the ordinary course of
the normal day-to-day operations of other Persons that are in the
same line of business as such Person.
(ee)
“
OTS ” means the Office of
Thrift Supervision.
(ff)
“
Outstanding First Manhattan
Shares ” means the number of
shares of First Manhattan Common Stock issued and outstanding
immediately prior to the Effective Time, excluding any shares held
by First Manhattan or any First Manhattan Subsidiary.
5
(gg)
“
Person ” means any
individual, corporation (including any non-profit corporation),
foundation, general or limited partnership, limited liability
company, joint venture, estate, trust, association, organization,
labor union or other entity or Regulatory Authority.
(hh)
“
Proceeding ” means any action,
arbitration, audit, hearing, investigation, litigation or suit
(whether civil, criminal, administrative, investigative or
informal) commenced, brought, conducted or heard by or before, or
otherwise involving, any judicial or governmental authority,
including a Regulatory Authority, or arbitrator.
(ii)
“
Regulatory Authority
” means
any federal, state or local governmental body, agency, court or
authority that, under applicable Legal Requirements:
(i) has supervisory, judicial, administrative, police,
enforcement, taxing or other power or authority over First
Manhattan, Landmark or any of their respective Subsidiaries;
(ii) is required to approve, or give its consent to any of the
Contemplated Transactions; or (iii) with which a filing must
be made in connection therewith, including, in any case, the
Federal Reserve, the OTS and the OCC.
(jj)
“
Representative ” means with respect
to a particular Person, any director, officer, manager, employee,
agent, consultant, advisor or other representative of such Person,
including legal counsel, accountants and financial
advisors.
(kk)
“
Subsidiary ” means with respect
to any Person (the “ Owner ”), any corporation or
other Person of which securities or other interests having the
power to elect at least one-third of that corporation’s or
other Person’s board of directors or similar governing body,
or otherwise having the power to direct the business and policies
of that corporation or other Person (other than securities or other
interests having such power only upon the happening of a
contingency that has not occurred) are held by the Owner or one or
more of its Subsidiaries.
(ll)
“
Tax ” means any tax
(including any income tax, capital gains tax, value added tax,
sales tax, property tax, gift tax or estate tax), levy, assessment,
tariff, duty (including any customs duty), deficiency or other fee,
and any related charge or amount (including any fine, penalty,
interest or addition to tax), imposed, assessed or collected by or
under the authority of any Regulatory Authority or payable pursuant
to any Legal Requirement, tax sharing agreement or any other
Contract relating to the sharing or payment of any such tax, levy,
assessment, tariff, duty, deficiency or fee.
(mm)
“
Tax Return ” means any return
(including any information return), report, statement, schedule,
notice, form or other document or information filed with or
submitted to, or required to be filed with or submitted to, any
Regulatory Authority in connection with the determination,
assessment, collection or payment of any Tax or in connection with
the administration, implementation, or enforcement of or compliance
with any Legal Requirement relating to any Tax.
(nn)
“
Threatened ” means a claim,
Proceeding, dispute, action or other matter for which any demand or
statement has been made (orally or in writing) or any notice has
been
6
given (orally or
in writing), or if any other event has occurred or any other
circumstances exist, that would lead a prudent Person to conclude
that such a claim, Proceeding, dispute, action or other matter is
reasonably likely to be asserted, commenced, taken or otherwise
pursued in the future.
(oo)
“
Thrift Reports ” means the quarterly
reports of income and condition filed by the Bank with Regulatory
Authorities.
Section 1.2
Principles of
Construction .
(a)
In this
Agreement, unless otherwise stated or the context otherwise
requires, the following uses apply: (i) actions permitted
under this Agreement may be taken at any time and from time to time
in the actor’s reasonable discretion; (ii) references to
a statute shall refer to the statute and any successor statute, and
to all regulations promulgated under or implementing the statute or
its successor, as in effect at the relevant time; (iii) in
computing periods from a specified date to a later specified date,
the words “ from
” and
“ commencing on
” (and the
like) mean “ from and
including ,” and the words
“ to
,”
“ until
” and
“ ending on
” (and the
like) mean “ to, but
excluding ”;
(iv) references to a governmental or quasi-governmental
agency, authority or instrumentality shall also refer to a
regulatory body that succeeds to the functions of the agency,
authority or instrumentality; (v) indications of time of day
mean Manhattan, Kansas, time; (vi) ” including ” means “
including, but not limited to
”;
(vii) all references to sections, schedules and exhibits are
to sections, schedules and exhibits in or to this Agreement unless
otherwise specified; (viii) all words used in this Agreement
will be construed to be of such gender or number as the
circumstances and context require; (ix) the captions and
headings of articles, sections, schedules and exhibits appearing in
or attached to this Agreement have been inserted solely for
convenience of reference and shall not be considered a part of this
Agreement nor shall any of them affect the meaning or
interpretation of this Agreement or any of its provisions; and
(x) any reference to a document or set of documents in this
Agreement, and the rights and obligations of the parties under any
such documents, shall mean such document or documents as amended
from time to time, and any and all modifications, extensions,
renewals, substitutions or replacements thereof.
(b)
The schedules
referred to in this Agreement consist of the agreements and other
documentation described and referred to in this Agreement, which
schedules were delivered by First Manhattan to Landmark prior to
the Agreement Date. Terms used but not otherwise defined in
the schedules shall have the meanings attributed to them in the
Agreement. The disclosures in the schedules, and those in any
supplement thereto, shall relate only to the representations and
warranties in the section of this Agreement to which they
reasonably relate and not to any other representation or warranty
in this Agreement. The disclosure schedules may describe
contracts, instruments or documents or include information that
does not meet the minimum standards of materiality requiring
disclosure therein. The description of any such document or
inclusion of such information in the schedules does not constitute
an acknowledgement or admission by First Manhattan that such
document or information is material. Any matter expressly and
specifically disclosed in good faith on a specific
schedule shall be deemed to be disclosed on all other
schedules to the extent relevant to the subject matter
thereof. In the event of any inconsistency between the
statements in the body of this Agreement and those in the Schedules
(other than an exception expressly set forth as such in
the
7
Schedules with
respect to a specifically identified representation or warranty),
the statements in the body of this Agreement will
control.
(c)
All accounting
terms not specifically defined herein shall be construed in
accordance with GAAP.
(d)
With regard to
each and every term and condition of this Agreement and any and all
agreements and instruments subject to the terms hereof, the parties
hereto understand and agree that the same have or has been mutually
negotiated, prepared and drafted, and that if at any time the
parties hereto desire or are required to interpret or construe any
such term or condition or any agreement or instrument subject
hereto, no consideration shall be given to the issue of which party
hereto actually prepared, drafted or requested any term or
condition of this Agreement or any agreement or instrument subject
hereto.
Article 2
THE MERGER
Section 2.1
The Merger
. Provided that this
Agreement shall not have been terminated in accordance with its
express terms, upon the terms and subject to the conditions of this
Agreement and in accordance with the applicable provisions of the
Kansas General Corporation Code, as amended (the “
Kansas Code ”), at the Effective
Time (as defined below), Acquisition Corp shall be merged with and
into First Manhattan pursuant to the provisions of, and with the
effects provided in, the Kansas Code, the separate corporate
existence of Acquisition Corp shall cease and First Manhattan shall
be the Surviving Corporation. As a result of the Merger, each
of the Outstanding First Manhattan Shares, other than Dissenting
Shares (as defined below), will be converted into the right to
receive the Merger Consideration.
Section 2.2
Effective Time;
Closing .
(a)
Provided that
this Agreement shall not have been terminated in accordance with
its express terms, the closing of the Merger (the “
Closing ”) shall occur through
the mail or at a place that is mutually acceptable to Landmark and
First Manhattan, or if they fail to agree, at the offices of Barack
Ferrazzano Kirschbaum Perlman & Nagelberg LLP, located at
333 W. Wacker Drive, Suite 2700, Chicago, Illinois 60606, at
10:00 a.m. on the date that is ten (10) Business
Days after the end of the calendar month in which both of the
following conditions are satisfied: (i) the receipt of
the last required regulatory approval of the Contemplated
Transactions and the expiration of the last requisite waiting
period; and (ii) the satisfaction or written waiver of all of
the conditions provided for in Article 9 and Article 10 (other than those which are
intended to be satisfied at the Closing); whichever is later, or at
such other time as First Manhattan and Landmark may agree in
writing (the “ Closing
Date ”). Subject to
the provisions of Article 11 , failure to consummate the
Merger on the date and time and at the place determined pursuant to
this Section will not result in the termination of this
Agreement and will not relieve any party of any obligation under
this Agreement.
(b)
The parties to
this Agreement agree to file on the Closing Date the appropriate
certificate of merger, as contemplated by Sections 17-6003 and
17-6701 of the Kansas Code with the Secretary of State of the State
of Kansas. The Merger shall be effective
8
at the time and
on the date agreed to by the parties to this Agreement, and in the
event the parties fail to so agree, at 12:01 a.m. of the day
following the date on which the certificate of merger is accepted
for filing by the Secretary of State of the State of Kansas (the
“ Effective Time
”).
Section 2.3
Effects of Merger
. At the
Effective Time, the effect of the Merger shall be as provided in
the Kansas Code. Without limiting the generality of the
foregoing, at the Effective Time, all the property, rights,
privileges, powers and franchises of Acquisition Corp and First
Manhattan shall be vested in the Surviving Corporation, and all
debts, liabilities and duties of Acquisition Corp and First
Manhattan shall become the debts, liabilities and duties of the
Surviving Corporation.
Section 2.4
Articles of
Incorporation .
At the
Effective Time, the articles of incorporation of First Manhattan as
in effect immediately prior to the Effective Time shall be the
articles of incorporation of the Surviving Corporation until
thereafter amended in accordance with applicable law.
Section 2.5
Bylaws . At the Effective
Time, the bylaws of First Manhattan as in effect immediately prior
to the Effective Time shall be the bylaws of the Surviving
Corporation until thereafter amended in accordance with applicable
law.
Section 2.6
Board of Directors
. From and after the
Effective Time, until duly changed in compliance with applicable
law and the articles of incorporation and bylaws of the Surviving
Corporation, the board of directors of the Surviving Corporation
shall consist of the directors of Acquisition Corp immediately
prior to the Effective Time.
Section 2.7
Management
. At the Effective Time, the
officers of Acquisition Corp immediately prior to the Effective
Time shall be the initial officers of the Surviving Corporation and
shall hold office until their respective successors are duly
elected or appointed and qualified in the manner provided in the
articles of incorporation and bylaws of the Surviving
Corporation.
Section 2.8
Landmark’s Deliveries at
Closing . At the Closing, in
addition to any other requirements set forth on this Agreement,
Landmark shall deliver or cause to be delivered the following items
to or on behalf of First Manhattan:
(a)
for each First
Manhattan Stockholder, a certified check or wire transfer payable
to the order of such stockholder in an amount equal to the Per
Share Purchase Price multiplied by the number of shares of First
Manhattan Common Stock represented by all stock certificates
registered in such stockholder’s name which are duly
delivered to Landmark pursuant to Section 2.9(a) ;
(b)
copies of
resolutions of the board of directors of Landmark approving this
Agreement and the consummation of the Contemplated Transactions,
certified as of the Closing Date by the Secretary or any Assistant
Secretary of Landmark;
(c)
copies of
resolutions of the board of directors and the sole stockholder of
Acquisition Corp approving this Agreement and the consummation of
the Contemplated
9
Transactions,
certified as of the Closing Date by the Secretary or any Assistant
Secretary of Acquisition Corp;
(d)
a good standing
certificate for Acquisition Corp issued by the Secretary of State
of the State of Kansas, and dated not more than fifteen (15)
Business Days prior to the Closing Date;
(e)
a copy of the
articles of incorporation of Acquisition Corp certified not more
than fifteen (15) Business Days prior to the Closing Date by the
Secretary of State of the State of Kansas;
(f)
a certificate of
the Secretary or any Assistant Secretary of Acquisition Corp dated
the Closing Date certifying a copy of the bylaws of Acquisition
Corp;
(g)
a certificate
executed by the President or any Vice President, and by the
Secretary or any Assistant Secretary of Acquisition Corp, dated the
Closing Date, stating that: (i) all of the
representations and warranties of Acquisition Corp set forth in
this Agreement, as the same may have been updated pursuant
to Section 7.2
, are true and
correct in all material respects with the same force and effect as
if all of such representations and warranties were made at the
Closing Date, provided, however, that to the extent such
representations and warranties expressly relate to an earlier date,
such representations shall be true and correct in all material
respects on and as of such earlier date, and provided
further , that to the extent that representations and
warranties are made in this Agreement subject to a standard of
materiality or Knowledge, such representations and warranties shall
be true and correct in all respects; and (ii) Acquisition Corp
has performed or complied in all material respects with all of the
covenants and obligations to be performed or complied with by it
under the terms of this Agreement on or prior to the Closing Date,
provided, however, that to the extent performance and
compliance with such covenants and obligations are subject in this
Agreement to a standard of materiality, Acquisition Corp shall have
performed and complied in all respects with such covenants and
obligations;
(h)
a certificate
executed by the President or any Vice President, and by the
Secretary or any Assistant Secretary of Landmark, dated the Closing
Date, stating that: (i) all of the representations and
warranties of Landmark set forth in this Agreement, as the same may
have been updated pursuant to Section 7.2 , are true and correct in all
material respects with the same force and effect as if all of such
representations and warranties were made at the Closing Date,
provided, however, that to the extent such representations
and warranties expressly relate to an earlier date, such
representations shall be true and correct in all material respects
on and as of such earlier date, and provided further , that
to the extent that representations and warranties are made in this
Agreement subject to a standard of materiality or Knowledge, such
representations and warranties shall be true and correct in all
respects; and (ii) Landmark has performed or complied in all
material respects with all of the covenants and obligations to be
performed or complied with by it under the terms of this Agreement
on or prior to the Closing Date, provided, however, that to
the extent performance and compliance with such covenants and
obligations are subject in this Agreement to a standard of
materiality, Landmark shall have performed and complied in all
respects with such covenants and obligations; and
10
(i)
such other
documents as First Manhattan may reasonably request.
All of such items shall be reasonably
satisfactory in form and substance to First Manhattan and its
counsel.
Section 2.9
First Manhattan’s
Deliveries at Closing . At the Closing, First
Manhattan shall deliver or cause to be delivered the following
items to or on behalf of Landmark:
(a)
certificates
representing all of the issued and outstanding shares of First
Manhattan Common Stock, duly endorsed (or accompanied by duly
executed stock powers);
(b)
a good standing
certificate for First Manhattan issued by the Secretary of State of
the State of Kansas and dated not more than fifteen (15)
Business Days prior to the Closing Date;
(c)
a copy of the
articles of incorporation of First Manhattan certified not more
than fifteen (15) Business Days prior to the Closing Date by
the Secretary of State of the State of Kansas;
(d)
a certificate of
the Secretary or any Assistant Secretary of First Manhattan dated
the Closing Date certifying a copy of the bylaws of First
Manhattan;
(e)
copies of
resolutions of the stockholders and the board of directors of First
Manhattan authorizing and approving this Agreement and the
consummation of the Contemplated Transactions, certified as of the
Closing Date by the Secretary or any Assistant Secretary of First
Manhattan;
(f)
a good standing
certificate for the Bank issued by the OTS and dated not more than
fifteen (15) Business Days prior to the Closing
Date;
(g)
a copy of the
charter of the Bank certified by the OTS and dated not more than
fifteen (15) Business Days prior to the Closing
Date;
(h)
a certificate of
the Secretary of the Bank dated the Closing Date certifying a copy
of the bylaws of the Bank and stating that there have been no
further amendments to the charter of the Bank delivered pursuant to
the immediately preceding paragraph of this Section;
(i)
a certificate
executed by the Chairman or President, and by the Secretary or any
Assistant Secretary of First Manhattan, dated the Closing Date,
stating that: (i) all of the representations and
warranties of First Manhattan set forth in this Agreement, as the
same may have been updated pursuant to Section 6.8 , are true and correct in all
material respects with the same force and effect as if all of such
representations and warranties were made at the Closing Date,
provided, however, that to the extent such representations
and warranties expressly relate to an earlier date, such
representations shall be true and correct in all material respects
on and as of such earlier date, and provided further , that
to the extent that representations and warranties are made in this
Agreement subject to a standard of materiality or Knowledge, such
representations and warranties shall be true and correct in all
respects; and (ii) First Manhattan
11
has performed or
complied in all material respects with all of the covenants and
obligations to be performed or complied with by it under the terms
of this Agreement on or prior to the Closing Date, provided,
however, that to the extent performance and compliance with
such covenants and obligations are subject in this Agreement to a
standard of materiality, First Manhattan shall have performed and
complied in all respects with such covenants and
obligations;
(j)
a list of all
First Manhattan Stockholders as of the Closing Date certified by
the Secretary or any Assistant Secretary of First
Manhattan;
(k)
owner’s
title insurance policies issued by Chicago Title Insurance Company
or such other title insurance company as is reasonably acceptable
to Landmark in accordance with the title commitments delivered by
First Manhattan to Landmark in accordance with Section 6.5 , and in each case, in policy
amounts at least equal to the book value of the property covered by
such policies, as shown on the books and records of First Manhattan
or the Bank;
(l)
a legal opinion
of First Manhattan’s counsel dated the Closing Date in the
form attached as Exhibit A ;
(m)
an updated
Schedule 6.18
dated as of the
Closing Date;
(n)
a certificate of
each of First Manhattan’s legal counsel, accountants and
financial advisor or investment banker, if any, representing that
all of their respective fees and expenses relating to the
Contemplated Transactions incurred by First Manhattan prior to and
including the Effective Time have been paid in full;
and
(o)
such other
documents as Landmark may reasonably request.
All of such items shall be reasonably
satisfactory in form and substance to Landmark and its
counsel.
Section 2.10
Bank Merger
. The parties understand
that it is the present intention of Landmark to effect the Bank
Merger immediately after the Merger or as soon as practicable
thereafter. Landmark and First Manhattan agree to cooperate
and to take such steps as may be necessary to obtain all requisite
regulatory, corporate and other approvals to effect the Bank
Merger, subject to the consummation of, and to be effective
immediately after the Merger or as soon as practicable
thereafter. The resulting bank shall be Landmark Bank.
In furtherance of such agreement, each of Landmark and First
Manhattan agrees:
(a)
respectively, to cause the board of directors of each of Landmark
Bank and the Bank to approve the Bank Merger and to submit the same
to its respective sole stockholder for approval;
(b)
respectively, to vote the shares of stock of Landmark Bank and the
Bank owned by them in favor of the Bank Merger; and
12
(c)
to take, or cause to be taken, all steps necessary to consummate
the Bank Merger at the Effective Time or as soon thereafter as
reasonably practicable.
The Bank Merger shall be accomplished pursuant
to a merger agreement containing such terms and conditions as are
ordinary and customary for affiliated bank merger transactions of
such type. Notwithstanding anything contained herein to the
contrary: (x) the Bank Merger will be effective no
earlier than the Effective Time; and (y) none of
Landmark’s actions in connection with the Bank Merger will
unreasonably interfere with any of the operations of First
Manhattan or the Bank prior to the Effective Time.
Section 2.11
Alternative Structure
. Notwithstanding
anything contained herein to the contrary, upon receipt of First
Manhattan’s prior written consent (which consent shall not be
unreasonably withheld), Landmark may specify, for any reasonable
business, tax or regulatory purpose, that, before the Effective
Time, Landmark, Acquisition Corp and First Manhattan shall enter
into transactions other than those described in this Agreement to
effect the purposes of this Agreement, including the merger of
First Manhattan with any Affiliate of Landmark or the merger of any
Affiliate of Landmark with First Manhattan. The parties to
this Agreement agree to take all action necessary and appropriate
to effect, or cause to be effected, such transactions; provided,
however , that no such proposed change in the structure of the
transactions contemplated in this Agreement shall delay the Closing
Date (if such a date has already been firmly established) by more
than forty-five (45) Business Days or adversely affect the economic
benefits, the form of consideration or the tax effect of the Merger
at the Effective Time to the First Manhattan
Stockholders.
Section 2.12
Absence of Control
. Subject to any
specific provisions of this Agreement, it is the intent of the
parties to this Agreement that neither Landmark nor First Manhattan
by reason of this Agreement shall be deemed (until consummation of
the Contemplated Transactions) to control, directly or indirectly,
the other party or any of its respective Subsidiaries and shall not
exercise, or be deemed to exercise, directly or indirectly, a
controlling influence over the management or policies of such other
party or any of its respective Subsidiaries.
Article 3
CONVERSION OF SECURITIES IN THE MERGER
Section 3.1
Manner of Merger
.
(a)
At the Effective
Time, by virtue of the Merger and without any action on the part of
Landmark or First Manhattan or any First Manhattan
Stockholder:
(i)
each share of
common stock, $0.01 par value per share, of Acquisition Corp issued
and outstanding immediately prior to the Effective Time shall be
converted into one validly issued, fully paid and non-assessable
share of common stock of the Surviving Corporation;
13
(ii)
except as
expressly provided in Section 3.2 , each Outstanding First
Manhattan Share shall be converted into the right to receive cash
in an amount equal to the “Purchase Price Per Share”
which shall be
equal to:
(A)
the quotient of:
(I)
Twelve Million
Eight Hundred Seventy Five Thousand Dollars ($12,875,000),
increased by the sum of One Hundred Twenty Five Thousand Dollars
($125,000), but if and only if the Bank receives on or before the
Determination Date a payment or payments of principal in the
aggregate amount of Seven Hundred Thousand Dollars ($700,000) in
respect of the loan described in Schedule 3.1(a) ; divided by
(II)
the total
Outstanding First Manhattan Shares; and
(B)
increased by the Per Share Equity
Increase, if any, as defined below, and
(C)
decreased by the Per Share Equity
Decrease, if any, as defined below;
(iii)
each share of
First Manhattan Common Stock held by First Manhattan as treasury
stock shall not be converted into the right to receive cash, but
instead shall be canceled as a result of the Merger;
and
(iv)
each share of
First Manhattan Common Stock owned by Landmark shall be
cancelled.
(b)
For the purposes
of this Section:
(i)
the
“Minimum Equity Amount” means:
(A)
Five Million Five Hundred Thirty
Seven Thousand Six Hundred Twenty Five Dollars ($5,537,625) if the
Closing occurs at any time prior to November 1,
2005;
(B)
Five Million Six Hundred Thirty
Seven Thousand Six Hundred Twenty Five Dollars ($5,637,625) if the
Closing occurs at any time between November 1, 2005, and the
close of business on November 30, 2005; and
(C)
Five Million Seven Hundred Thirty
Seven Thousand Six Hundred Twenty Five Dollars ($5,737,625) if the
Closing occurs at any time after November 30, 2005, and before
the close of business on December 30, 2005;
(D)
Five Million Eight Hundred Thirty
Seven Thousand Six Hundred Twenty Five Dollars ($5,837,625) if the
Closing occurs at any time after December 30, 2005, and before
the close of business on January 31, 2006;
14
(E)
Five Million Nine Hundred Thirty
Seven Thousand Six Hundred Twenty Five Dollars ($5,937,625) if the
Closing occurs at any time after January 31, 2006, and before
the close of business on February 28, 2006;
(F)
Six Million Thirty Seven Thousand
Six Hundred Twenty Five Dollars ($6,037,625) if the Closing occurs
at any time after February 28, 2006, and before the close of
business on March 31, 2006; and
(G)
Six Million One Hundred Thirty
Seven Thousand Six Hundred Twenty Five Dollars ($6,137,625) if the
Closing occurs at any time after March 31, 2006, and before
the close of business on May 1, 2006;
(ii)
the
“Per Share Equity
Decrease” , if any, shall be equal
to: (A) the total amount that the Adjusted
Stockholders’ Equity is less than the Minimum Equity Amount;
divided by (B) the Outstanding First Manhattan Shares;
and
(iii)
the
“Per Share Equity
Increase,” if any, shall be equal
to: (A) the total amount that the Adjusted
Stockholders’ Equity is greater than the Minimum Equity
Amount; divided by (B) the Outstanding First Manhattan
Shares.
(c)
After the
Effective Time, no holder of First Manhattan Common Stock that is
issued and outstanding immediately prior to the Effective Time will
have any rights in respect of such First Manhattan Common Stock
except to receive payment for such shares of First Manhattan Common
Stock in the manner provided herein or as provided in
Section 17-6712 of the Kansas Code.
(d)
At the Effective
Time, First Manhattan Stockholders shall cease to be, and shall
have no rights as, First Manhattan Stockholders, other than to
receive the Merger Consideration. After the Effective Time,
there shall be no transfers on the stock transfer books of First
Manhattan or the Surviving Corporation of shares of First Manhattan
Common Stock. Landmark shall not be liable to any former
First Manhattan Stockholder for any amount properly delivered to a
public official pursuant to applicable abandoned property, escheat
or similar laws.
Section 3.2
Dissenting Shares
.
(a)
Notwithstanding
anything to the contrary contained in this Agreement, to the extent
appraisal rights are available to First Manhattan stockholders
pursuant to Section 17-6712 of the Kansas Code, any shares
held by a Person who delivers to First Manhattan, prior to the time
the vote is taken by First Manhattan’s stockholders on this
Agreement and the Merger, a written demand for payment for his or
her shares, whose shares were not voted in favor of the Merger and
who complies with all of the provisions of the Kansas Code
concerning the rights of such Person to dissent from the Merger and
to require appraisal of such Person’s shares and who has not
withdrawn such objection or waived such rights prior to the Closing
Date (“ Dissenting
Shares ”) shall not be
converted pursuant to this Article, but shall become the right to
receive such consideration as may be determined to be due to the
holder of such Dissenting Shares pursuant to the Kansas Code,
provided, however , that each Dissenting Share held by a
Person at the Effective Time who shall, after the
Effective
15
Time, withdraw
the demand for appraisal or lose the right of appraisal, in either
case, pursuant to the Kansas Code shall be deemed to be converted,
as of the Effective Time, into cash in an amount determined as
provided in this Agreement upon surrender to Landmark in the manner
provided in Section 2.8(a) of the stock certificates
that represented, immediately prior to the Effective Time, shares
of First Manhattan Common Stock.
(b)
First Manhattan
shall give Landmark: (i) prompt written notice of any
demands for appraisal received by First Manhattan, withdrawals of
such demands and any other instruments served pursuant to the
Kansas Code and received by First Manhattan; and (ii) the
opportunity to direct all negotiations and proceedings with respect
to demands for appraisal under the Kansas Code. First
Manhattan shall not, except with the prior written consent of
Landmark, make any payment with respect to any demands for
appraisal or offer to settle any such demands.
Article 4
REPRESENTATIONS AND WARRANTIES OF FIRST MANHATTAN
First Manhattan hereby represents
and warrants to Landmark that the following are true and correct as
of the Agreement Date, and will be true and correct as of the
Effective Time:
Section 4.1
First Manhattan
Organization . First
Manhattan: (a) is a corporation duly organized, validly
existing and in good standing under the laws of the State of Kansas
and is also in good standing in each other jurisdiction in which
the nature of the business conducted or the properties or assets
owned or leased by it makes such qualification necessary;
(b) is registered with the OTS as a thrift holding company
under the HOLA; and (c) has full power and authority,
corporate and otherwise, to operate as a thrift holding company and
to own, operate and lease its properties as presently owned,
operated and leased, and to carry on its business as it is now
being conducted, except where the failure to be so qualified would
not have a Material Adverse Effect on First Manhattan on a
consolidated basis. Copies of the articles of incorporation
and bylaws of First Manhattan and all amendments thereto are set
forth on Schedule 4.1 and are complete and
correct. First Manhattan has no Subsidiaries other than the
Bank and as set forth on Schedule 4.1 .
Section 4.2
First Manhattan Subsidiary
Organization . The Bank is a federal
savings bank duly organized, validly existing and in good standing
under the HOLA. Each other First Manhattan Subsidiary is duly
organized, validly existing and in good standing in its state or
jurisdiction of organization. Each First Manhattan Subsidiary
has full power and authority, corporate and otherwise, to own,
operate and lease its properties as presently owned, operated and
leased, and to carry on its business as it is now being conducted,
and is duly qualified to do business and is in good standing in
each jurisdiction in which the nature of the business conducted or
the properties or assets owned or leased by it makes such
qualification necessary. Copies of the charter and bylaws (or
similar organizational documents) of each First Manhattan
Subsidiary and all amendments thereto are set forth on
Schedule 4.2
and are complete
and correct.
16
Section 4.3
Authorization;
Enforceability .
(a)
First Manhattan
has the requisite corporate power and authority to enter into and
perform its obligations under this Agreement. The execution,
delivery and performance of this Agreement by First Manhattan, and
the consummation by it of its obligations under this Agreement,
have been authorized by all necessary corporate action, subject to
stockholder approval, and this Agreement constitutes a legal, valid
and binding obligation of First Manhattan enforceable in accordance
with its terms, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization or other laws affecting
creditors’ rights generally and subject to general principles
of equity.
(b)
Except for
ordinary corporate requirements, no “business
combination,” “moratorium,” “control
share” or other state anti-takeover statute or regulation or
any provisions contained in the certificate of incorporation or
bylaws or similar organizational documents of First Manhattan or
any First Manhattan Subsidiary: (i) prohibits or
restricts First Manhattan’s ability to perform its
obligations under this Agreement, or its ability to consummate the
Contemplated Transactions; (ii) would have the effect of
invalidating or voiding this Agreement, or any provision hereof; or
(iii) would subject Landmark to any material impediment or
condition in connection with the exercise of any of its rights
under this Agreement. The board of directors of First
Manhattan has unanimously approved the execution of, and
performance by First Manhattan of its obligations under, this
Agreement.
Section 4.4
No Conflict
. Except as
set forth on Schedule 4.4 , neither the execution nor
delivery of this Agreement nor the consummation or performance of
any of the Contemplated Transactions will, directly or indirectly
(with or without notice or lapse of time):
(a) contravene, conflict with or result in a violation of any
provision of the articles of incorporation or charter or bylaws (or
similar organizational documents), each as in effect on the
Agreement Date, or any currently effective resolution adopted by
the board of directors (or similar governing body) or stockholders
of First Manhattan or any First Manhattan Subsidiary;
(b) contravene, conflict with or result in a violation of, or
give any Regulatory Authority or other Person the valid and
enforceable right to challenge any of the Contemplated Transactions
or to exercise any remedy or obtain any relief under, any Legal
Requirement or any Order to which First Manhattan or any First
Manhattan Subsidiary, or any of their respective assets that are
owned or used by them, may be subject, except for any
contravention, conflict or violation that is permissible by virtue
of obtaining the regulatory approvals necessitated by the
Contemplated Transactions, including any such approvals under the
BHCA, the HOLA, the National Bank Act, as amended (the
“ NBA
”), the
Federal Deposit Insurance Act, as amended (the “
FDIA ”), the Delaware
General Corporation Law (the “ Delaware Code ”) and the Kansas Code;
(c) contravene, conflict with or result in a violation or
breach of any provision of, or give any Person the right to declare
a default or exercise any remedy under, or to accelerate the
maturity or performance of, or to cancel, terminate or modify any
Contract to which First Manhattan or any First Manhattan Subsidiary
is a party or by which any of their respective assets is bound; or
(d) result in the creation of any lien, charge or encumbrance
upon or with respect to any of the assets owned or used by First
Manhattan or any First Manhattan Subsidiary. Except for the
approvals referred to in Section 8.1 , and except as set forth
in Schedule 4.4
and the requisite
approval of First Manhattan Stockholders, neither First Manhattan
nor any First Manhattan Subsidiary is or will be required to give
any notice to or obtain any consent from any Person in
17
connection with the
execution and delivery of this Agreement or the consummation or
performance of any of the Contemplated Transactions.
Section 4.5
First Manhattan
Capitalization .
(a)
As of the
Agreement Date, the authorized capital stock of First Manhattan
consists exclusively of 25,000 shares of First Manhattan Common
Stock, of which 3,718.67 shares are duly issued and outstanding,
fully paid and non-assessable, and no shares are held by First
Manhattan as treasury shares. Except for this Agreement,
there are, as of the Agreement Date, no outstanding subscriptions,
contracts, conversion privileges, options, warrants, calls or other
rights obligating First Manhattan or any First Manhattan Subsidiary
to issue, sell or otherwise dispose of, or to purchase, redeem or
otherwise acquire, any shares of capital stock of First Manhattan
or any First Manhattan Subsidiary, and except for this Agreement,
First Manhattan is not a party to any Contract relating to the
issuance, purchase, sale or transfer of any equity securities or
other securities of First Manhattan. The maximum number of
Outstanding First Manhattan Shares is 3,718.67. First
Manhattan acknowledges that the Merger Consideration has been
determined based on the accuracy of the representations and
warranties made in this Section with respect to the number of
Outstanding First Manhattan Shares and the absence of any
outstanding stock options for the purchase of First Manhattan
Common Stock, and acknowledges that any Breach of the
representations and warranties in this Section 4.5(a) shall be deemed to have a
Material Adverse Effect on Landmark for purposes of this
Agreement.
(b)
None of the
shares of First Manhattan Common Stock have been issued in
violation of any federal or state securities laws or any other
Legal Requirement. Since December 31, 2004, except as
disclosed in or permitted by this Agreement or as provided
on Schedule 4.5
, no shares of
First Manhattan capital stock have been purchased, redeemed or
otherwise acquired, directly or indirectly, by First Manhattan or
any First Manhattan Subsidiary and no dividends or other
distributions payable in any equity securities of First Manhattan
or any First Manhattan Subsidiary have been declared, set aside,
made or paid to the First Manhattan Stockholders. None of the
shares of authorized capital stock of First Manhattan are, nor on
the Closing Date will they be, subject to any claim of right
inconsistent with this Agreement. Except as may be provided
in any First Manhattan Loan (as defined below) entered into in the
Ordinary Course of Business, First Manhattan does not own or have
any Contract to acquire any equity securities or other securities
of any Person or any direct or indirect equity or ownership
interest in any other business except for the capital stock of the
Bank and the First Manhattan Subsidiaries set forth in
Schedule 4.1
.
Section 4.6
First Manhattan Subsidiary
Capitalization . As of the Agreement
Date, the authorized capital stock of the Bank consists, and
immediately prior to the Effective Time will consist, exclusively
of 44,000 shares of common stock, $25.00 par value per share, all
of which shares are, and immediately prior to the Closing will be,
duly authorized, validly issued and outstanding, fully paid and
nonassessable. Except as set forth on Schedule 4.6 , First Manhattan owns, and
will own on the Closing Date, either directly or indirectly all of
the issued and outstanding shares of capital stock of each First
Manhattan Subsidiary (collectively, the “ First Manhattan Subsidiary Shares
”), free
and clear of any lien or encumbrance whatsoever. The First
Manhattan Subsidiary Shares are, and will be on the Closing Date,
freely transferable
18
and are, and will be on the
Closing Date, subject to no claim except pursuant to this Agreement
and as set forth on Schedule 4.6 . There are no
unexpired or pending preemptive rights with respect to any shares
of capital stock of any First Manhattan Subsidiary, except for such
rights held exclusively by First Manhattan. There are no
First Manhattan Subsidiary Shares that are convertible into or
exchangeable for any shares of such First Manhattan
Subsidiary’s capital stock, except for such rights held
exclusively by First Manhattan, and no First Manhattan Subsidiary
is a party to any Contract relating to the issuance, sale or
transfer of any equity securities or other securities of such First
Manhattan Subsidiary. Except for collateral arrangements
entered into with borrowers or other obligors in the Ordinary
Course of Business, neither First Manhattan nor any First Manhattan
Subsidiary owns or has any Contract to acquire, any equity
securities or other securities of any Person or any direct or
indirect equity or ownership interest in any other business, except
as set forth on Schedule 4.6 .
Section 4.7
Financial Statements and
Reports . True, correct and
complete copies of the following financial statements are included
in Schedule 4.7
:
(a)
audited
Consolidated Balance Sheets for First Manhattan as of
December 31, 2004 and 2003, and the related audited
Consolidated Statements of Income, Statements of Cash Flows and
Consolidated Statements of Changes in Stockholders’ Equity of
First Manhattan for the year ended December 31, 2004 and
2003;
(b)
audited Balance
Sheets for the Bank as of December 31, 2002, 2003 and 2004,
and the related audited Statements of Income, Statements of Cash
Flows and Statements of Changes in Stockholder’s Equity of
the Bank for the years ended December 31, 2002, 2003 and
2004;
(c)
unaudited
Consolidated Balance Sheet for First Manhattan as of June 30,
2005, and the related unaudited Consolidated Statement of Income
for the six months ended June 30, 2005; and
(d)
Thrift Reports
for the Bank as of the close of business on December 31, 2002,
2003 and 2004, and for the six months ended June 30, 2004 and
2005.
The financial statements described in
clause (a) and (b) have been prepared in conformity
with GAAP. The financial statements described in
clauses (c) and (d) above have been prepared on a
basis consistent with past accounting practices and as required by
applicable Legal Requirements and fairly present the consolidated
financial condition and results of operations at the dates and for
the periods presented. Taken together, the financial
statements described in clauses (a), (b), (c) and
(d) above (collectively, and including the notes thereto, the
“ First Manhattan Financial Statements ”) are
complete and correct in all material respects and fairly and
accurately present the respective financial position, assets,
liabilities and results of operations of First Manhattan and the
First Manhattan Subsidiaries as at the respective dates of, and for
the periods referred to in, the First Manhattan Financial
Statements, subject to normal year-end non-material audit
adjustments in amounts consistent with past practice in the case of
the unaudited First Manhattan Financial Statements. The First
Manhattan Financial Statements do not include any material assets
or omit to state any material liabilities, absolute or contingent,
or other facts, which inclusion or omission would render the First
Manhattan Financial Statements misleading in any
19
material respect as of the respective dates and
for the periods referred to in the respective First Manhattan
Financial Statements.
Section 4.8
Books and Records
. The books
of account, minute books, stock record books and other records of
First Manhattan and each First Manhattan Subsidiary are complete
and correct in all material respects and have been maintained in
accordance with First Manhattan’s business practices and all
applicable material Legal Requirements, including the maintenance
of an adequate system of internal controls. The minute books
of First Manhattan and each First Manhattan Subsidiary contain
accurate and complete records in all material respects of all
meetings held of, and corporate action taken by, its respective
stockholders, board of directors and committees of the board of
directors. At the Closing, all of those books and records
will be in the possession of First Manhattan and the First
Manhattan Subsidiaries.
Section 4.9
Title to Properties
. First
Manhattan and each First Manhattan Subsidiary has good and
marketable title to all assets and properties, whether real or
personal, tangible or intangible, that it purports to own, subject
to no valid liens, mortgages, security interests, encumbrances or
charges of any kind except: (a) as noted in the most
recent First Manhattan Financial Statement or on
Schedule 4.7
or
Schedule 4.9
;
(b) statutory liens for Taxes not yet delinquent or being
contested in good faith by appropriate Proceedings and for which
appropriate reserves have been established and reflected on the
First Manhattan Financial Statements; (c) pledges or liens
required to be granted in connection with the acceptance of
government deposits, granted in connection with repurchase or
reverse repurchase agreements, pursuant to borrowings from Federal
Home Loan Banks or similar borrowings or otherwise incurred in the
Ordinary Course of Business; and (d) minor defects and
irregularities in title and encumbrances that do not materially
impair the use thereof for the purposes for which they are held,
including easements of record which do not underlie the
improvements, and covenants and restrictions of record which are
not violated by the existing improvements or the present use of the
property and which do not restrict reasonable use of the property
(all of such exceptions in clauses (a) through
(d) are collectively referred to as “
Permitted Exceptions
”).
Except as set forth on Schedule 4.9 , First Manhattan and each
First Manhattan Subsidiary as lessee has the right under valid and
existing leases to occupy, use, possess and control any and all of
the respective properties leased by it. Except where any
failure would not have a Material Adverse Effect on First Manhattan
on a consolidated basis, all buildings and structures owned by
First Manhattan and each First Manhattan Subsidiary lie wholly
within the boundaries of the real property owned or validly leased
by it, and do not encroach upon the property of, or otherwise
conflict with the property rights of, any other Person.
Section 4.10
Condition and Sufficiency of
Assets . The buildings,
structures and equipment of First Manhattan and each First
Manhattan Subsidiary are structurally sound, are in good operating
condition and repair (ordinary wear and tear excepted), and are
adequate for the uses to which they are being put, and none of such
buildings, structures or equipment is in need of maintenance or
repairs except for ordinary, routine maintenance and repairs that
are not material in the aggregate in nature or in cost.
Except where any failure would not have a Material Adverse Effect
on First Manhattan on a consolidated basis, the real property,
buildings, structures and equipment owned or leased by First
Manhattan and each First Manhattan Subsidiary are in compliance
with all Legal Requirements, including building and development
codes and other restrictions, subdivision regulations, building and
construction regulations,
20
drainage codes, health, fire
and safety laws and regulations, utility tariffs and regulations,
conservation laws and zoning laws and ordinances. The assets
and properties, whether real or personal, tangible or intangible,
that First Manhattan or any First Manhattan Subsidiary purport to
own are sufficient for the continued conduct of the business of
First Manhattan and each First Manhattan Subsidiary after the
Closing in substantially the same manner as conducted prior to the
Closing.
Section 4.11
Loans .
(a)
Each loan, loan
agreement, note, lease or other borrowing agreement, any
participation therein, and any guaranty, renewal or extension
thereof (collectively, “ First Manhattan Loans ”) reflected as an
asset on any of the First Manhattan Financial Statements or reports
filed with the Regulatory Authorities is evidenced by documentation
that is customary and legally sufficient in all material respects
and constitutes, to the Knowledge of First Manhattan, the legal,
valid and binding obligation of the obligor named therein,
enforceable in accordance with its terms, except to the extent that
the enforceability thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws relating to
or affecting the enforcement of creditors rights generally or
equitable principles or doctrines. To the Knowledge of First
Manhattan, no obligor named therein is seeking to avoid the
enforceability of any term of any First Manhattan Loan under any
such laws or equitable principles or doctrines, and no First
Manhattan Loan is subject to any defense, offset or
counterclaim.
(b)
All First
Manhattan Loans originated by First Manhattan or any First
Manhattan Subsidiary, and all First Manhattan Loans purchased by
First Manhattan or any First Manhattan Subsidiary and reflected as
an asset on any of the First Manhattan Financial Statements, were
made or purchased in accordance with the policies of the boards of
directors of First Manhattan and such First Manhattan Subsidiary
and in the Ordinary Course of Business of First Manhattan and such
First Manhattan Subsidiary. Except as set forth in
Schedule 4.11
, the
Bank’s interest in all First Manhattan Loans is free and
clear of any security interest, lien, encumbrance or other charge,
and First Manhattan and each First Manhattan Subsidiary have
complied in all material respects with all Legal Requirements
relating to such First Manhattan Loans.
(c)
Except as
disclosed in Schedule 4.11 as of June 30, 2005,
neither First Manhattan nor the Bank is a party to any First
Manhattan Loan: (i) under the terms of which the obligor
is more than sixty (60) days delinquent in payment of
principal or interest or in default of any other material provision
as of the dates shown thereon or for which the Bank has
discontinued the accrual of interest; (ii) that is currently
classified as “substandard,” “doubtful,”
“
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