Exhibit 2.1
PLAN OF CONVERSION AND REORGANIZATION
OF
ATLANTIC COAST FEDERAL, MHC
ATLANTIC COAST FEDERAL CORPORATION
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TABLE OF CONTENTS
1.
INTRODUCTION...........................................................1
2.
DEFINITIONS............................................................1
3.
PROCEDURES FOR
CONVERSION.............................................................7
4. HOLDING
COMPANY APPLICATIONS AND
APPROVALS.............................................................10
5. SALE OF
SUBSCRIPTION
SHARES................................................................10
6.
PURCHASE PRICE AND NUMBER OF SUBSCRIPTION
SHARES................................................................10
7.
RETENTION OF CONVERSION PROCEEDS BY THE HOLDING
COMPANY...............................................................11
8.
SUBSCRIPTION RIGHTS OF ELIGIBLE ACCOUNT HOLDERS (FIRST
PRIORITY).............................................................12
9.
SUBSCRIPTION RIGHTS OF EMPLOYEE PLANS (SECOND
PRIORITY).............................................................12
10. SUBSCRIPTION
RIGHTS OF SUPPLEMENTAL ELIGIBLE ACCOUNT HOLDERS (THIRD
PRIORITY).............................................................13
11. SUBSCRIPTION
RIGHTS OF OTHER MEMBERS (FOURTH
PRIORITY).............................................................13
12.
COMMUNITY
OFFERING..............................................................14
13. SYNDICATED
COMMUNITY
OFFERING..............................................................14
14. LIMITATION
ON
PURCHASES.............................................................15
15. PAYMENT FOR
SUBSCRIPTION
SHARES................................................................17
16. MANNER OF
EXERCISING SUBSCRIPTION RIGHTS THROUGH ORDER
FORMS.................................................................17
17. UNDELIVERED,
DEFECTIVE OR LATE ORDER FORM; INSUFFICIENT
PAYMENT...............................................................19
18. RESIDENTS OF
FOREIGN COUNTRIES AND CERTAIN
STATES................................................................19
19.
ESTABLISHMENT OF LIQUIDATION
ACCOUNT...............................................................19
20. VOTING
RIGHTS OF
STOCKHOLDERS..........................................................21
21. RESTRICTIONS
ON RESALE OR SUBSEQUENT
DISPOSITION...........................................................21
22. REQUIREMENTS
FOR STOCK PURCHASES BY DIRECTORS AND OFFICERS
FOLLOWING
THE CONVERSION..............................................21
23. TRANSFER OF
DEPOSIT
ACCOUNTS..............................................................22
24. REGISTRATION
AND.
MARKETING.............................................................22
25. TAX RULINGS
OR
OPINIONS..............................................................22
26. STOCK
BENEFIT PLANS AND EMPLOYMENT
AGREEMENTS............................................................22
27. RESTRICTIONS
ON ACQUISITION OF BANK AND HOLDING
COMPANY...............................................................23
28. PAYMENT OF
DIVIDENDS AND REPURCHASE OF
STOCK.................................................................24
29. ARTICLES OF
INCORPORATION AND
BYLAWS................................................................25
30. CONSUMMATION
OF CONVERSION AND EFFECTIVE
DATE..................................................................25
31. EXPENSES
OF
CONVERSION............................................................25
32. AMENDMENT OR
TERMINATION OF
PLAN..................................................................25
33. CONDITIONS
TO
CONVERSION............................................................26
34.
INTERPRETATION........................................................26
(i)
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PLAN OF CONVERSION AND REORGANIZATION OF
ATLANTIC COAST FEDERAL, MHC
1.
INTRODUCTION
This Plan of Conversion and Reorganization (the "Plan") provides for
the conversion of Atlantic Coast Federal, MHC, a federal mutual holding
company
(the "Mutual Holding Company"), into the capital stock form of
organization. The
Mutual Holding Company currently owns a majority of the common
stock of Atlantic
Coast Federal
Corporation, a federal
stock corporation (the
"Mid-Tier Holding
Company") which
owns 100% of the
common stock of Atlantic Coast Bank (the
"Bank"), a federal stock savings bank. A new Maryland stock holding
company (the
"Holding Company")
will be established as part of the Conversion and will
succeed to all the rights and obligations of the Mutual Holding
Company and the
Mid-Tier Holding
Company and issue Holding Company Common Stock in the
Conversion. The
purpose of the
Conversion
is to convert
the Mutual
Holding
Company to the capital
stock form of
organization which
will provide the Bank
and the Holding
Company with additional capital to grow and to respond to
changing regulatory
and market
conditions,
and with greater
flexibility
to
effect corporate
transactions,
including mergers, acquisitions and branch
expansions. The
Holding Company
Common Stock will be offered in the
Offering
upon the terms and conditions set forth herein. The subscription
rights granted
to Participants in the Subscription Offering are set forth in
Sections 8 through
11 hereof. All sales
of Holding Company Common Stock in the Community Offering
or the Syndicated Community Offering will be at the sole discretion
of the Board
of Directors of the
Bank and the Holding
Company. As part of
the Conversion,
each Minority
Stockholder will receive Holding Company Common Stock in
exchange
for Minority Shares. The Conversion will have no impact on
depositors, borrowers
or other customers
of the Bank. After the Conversion, the Bank's insured
deposits will
continue to be insured by the FDIC to the
extent provided by
applicable law.
This Plan has been
adopted by the Boards
of Directors
of the Mutual
Holding Company, the
Mid-Tier Holding Company and the Bank. This Plan also must
be approved by (i) a majority of the total number of outstanding
votes entitled
to be cast by Voting Members of the Mutual Holding Company at a Special Meeting
of Members to be called for that purpose, and (ii) at least two-thirds of the
outstanding common
stock of the
Mid-Tier Holding Company at a Meeting of
Stockholders to be called for that purpose, including at least a
majority of the
outstanding shares
owned by Minority
Stockholders.
The OTS must approve
this
Plan before it is presented to Voting Members and Minority
Stockholders
of the
Mid-Tier Holding Company for their approval.
2.
DEFINITIONS
For the purposes of this Plan, the following terms have the following
meanings:
ACCOUNT HOLDER - Any Person holding a Deposit Account in the
Bank.
ACTING IN CONCERT - The term Acting in Concert means (i) knowing
participation in a joint activity or interdependent conscious parallel action
towards a common goal whether or not pursuant to an express
agreement; or (ii) a
combination or pooling
of voting or other
interests in the
securities
of an
issuer for
a common purpose pursuant to any contract, understanding,
relationship,
agreement or other arrangement, whether written or otherwise.
A
person or company which acts in concert with another person or company ("other
party") shall also be
deemed to be acting in concert with any person or company
who is also acting in concert with that other party, except that any
tax-qualified employee
stock benefit plan will not be deemed to be
acting in
concert with its trustee or a person who serves in a similar
capacity solely for
the purpose of
determining whether
stock held by the trustee and stock held by
the plan will be aggregated.
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AFFILIATE - Any Person that directly or indirectly, through one or
more
intermediaries,
controls, is
controlled
by, or is under common
control with
another Person.
APPRAISED VALUE RANGE
- The range of the
estimated consolidated
pro
forma market
value of the
Holding Company, which shall also be equal to
the
estimated pro forma
market value of the
total number of shares
of Conversion
Stock to be issued in the Conversion, as determined by the
Independent Appraiser
prior to the
Subscription Offering
and as it may be
amended from time to time
thereafter. The
maximum and minimum of
the Appraised
Value Range may vary
as
much as 15% above and 15% below, respectively, the midpoint of the Appraised
Value Range.
ASSOCIATE - The term
Associate when used to
indicate a
relationship
with any person,
means (i) any
corporation
or organization (other than the
Mid-Tier Holding Company, the Bank or a majority-owned
subsidiary of the
Bank)
if the person is a senior officer or partner or beneficially
owns, directly or
indirectly, 10% or
more of any class of equity securities of the corporation or
organization, (ii) any
trust or other estate,
if the person has a
substantial
beneficial interest in
the trust or estate or is a trustee or fiduciary of the
trust or estate except that for the purposes of this Plan relating to
subscriptions in the Offering and the sale of Subscription
Shares following
the
Conversion, a
person who has a substantial beneficial interest in any
Non-Tax-Qualified
Employee Stock
Benefit Plan or any
Tax-Qualified
Employee
Stock Benefit
Plan, or who is a trustee or fiduciary
of such plan, is not
an
associate of such plan, and except that, for purposes of aggregating total
shares that may be held by Officers and Directors the term
"Associate" does
not
include any Tax-Qualified Employee Stock Benefit Plan, and
(iii) any person who
is related by blood or
marriage to such person and (A) who lives in the
same
home as such person or (B) who is a Director or Officer of the
Mid-Tier Holding
Company, the Bank or the Holding Company, or any of its parents or
subsidiaries.
BANK - Atlantic Coast Bank, Waycross, Georgia.
BANK MERGER - The merger of Interim with the Bank as set forth in
this
Plan.
CODE - The Internal Revenue Code of 1986, as amended.
COMMUNITY -
Chatham, Coffee and Ware Counties, Georgia and Clay,
Columbia, Duval, Nassau and St. John's County, Florida.
COMMUNITY OFFERING -
The offering for sale
to certain members of
the
general public
directly by the Holding Company of Subscription Shares not
subscribed for in the Subscription Offering.
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CONTROL - (including
the terms "controlling," "controlled by," and
"under common control
with") means the
director or indirect power to direct or
exercise a controlling
influence over the
management or policies
of a Person,
whether through the ownership of voting securities, by contract or otherwise as
described in 12 C.F.R. Part 574.
CONVERSION - The
conversion and
reorganization of the
Mutual Holding
Company to stock form pursuant to this Plan, and all steps incident
or necessary
thereto, including the Offering and the Exchange Offering.
CONVERSION STOCK - The Subscription Shares and the Exchange
Shares.
DEPOSIT ACCOUNT
- Any withdrawable account, including, without
limitation, savings,
time, demand, NOW accounts, money market, certificate and
passbook accounts.
DIRECTOR - A member of the Board of Directors of the Bank, the
Mid-Tier
Holding Company,
the Holding Company or the Mutual Holding Company, as
appropriate in the context.
ELIGIBLE ACCOUNT
HOLDER - Any Person
holding a Qualifying
Deposit on
the Eligibility Record Date for purposes of determining
subscription rights
and
establishing subaccount balances in the Liquidation Account.
ELIGIBILITY RECORD
DATE - The date for
determining Eligible
Account
Holders of the Bank, which is March 31, 2006.
EMPLOYEES - All
Persons who are
employed by the Bank,
the Mid-Tier
Holding Company or the Mutual Holding Company.
EMPLOYEE PLANS - Any one or more Tax-Qualified Employee Stock Benefit
Plans of the Bank or the Holding Company, including any ESOP and
401(k) Plan.
ESOP - The Bank's Employee Stock Ownership Plan and related
trust.
EXCHANGE OFFERING -
The offering of
Holding Company
Common Stock to
Minority Stockholders in exchange for Minority Shares.
EXCHANGE RATIO - The
rate at which shares
of Holding Company
Common
Stock are exchanged for Minority Shares upon consummation of the
Conversion. The
Exchange Ratio shall be determined as of the closing of the
Conversion and shall
be the rate
that will result in the Minority Stockholders owning in the
aggregate the same
percentage
of the outstanding shares of Holding Company
Common Stock
immediately upon completion of the Conversion as the percentage
of
Mid-Tier Holding Company common stock owned by them in the
aggregate immediately
prior to the consummation of the Conversion.
EXCHANGE SHARES - The
shares of Holding Company Common Stock issued to
Minority Stockholders in the Exchange Offering.
FDIC - The Federal Deposit Insurance Corporation.
3
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HOLDING COMPANY - The
Maryland corporation
formed for the purpose
of
acquiring all of the shares of capital stock of the Bank in
connection with
the
Conversion. Shares
of Holding Company Common Stock will be issued in the
Conversion to Participants and others in the Conversion.
HOLDING COMPANY
COMMON STOCK - The
common stock, par
value $0.01 per
share, of the Holding Company.
INDEPENDENT APPRAISER
- The appraiser
retained by the Mutual
Holding
Company, Mid-Tier
Holding Company and the Bank to prepare an
appraisal of the
pro forma market value of the Holding Company.
INTERIM - Atlantic Coast Interim Bank III, the interim federal savings
bank subsidiary of the Holding Company established to effect the
Conversion.
LIQUIDATION ACCOUNT -
The interest
in the Bank
received by
Eligible
Account Holders and Supplemental Account Holders in exchange for
their interest
in the Mutual Holding Company in connection with the
Conversion.
MAJORITY OWNERSHIP
INTEREST - The
percentage
of common stock of
the
Mid-Tier Holding Company owned by the Mutual Holding Company
immediately
prior
to the completion of the Conversion.
MEETING OF STOCKHOLDERS - The special or annual meeting of
stockholders
of the Mid-Tier
Holding Company and any adjournments thereof held to consider
and vote upon this Plan.
MEMBER - Any Person or entity who qualifies as a member of the Mutual
Holding Company pursuant to is charter and bylaws.
MHC MERGER - The
conversion of the
Mutual Holding Company into an
interim stock savings bank and subsequent merger with and into the Bank,
which
shall occur immediately prior to completion of the
Conversion, as set
forth in
this Plan.
MID-TIER HOLDING
COMPANY - Atlantic
Coast Federal
Corporation,
the
federal corporation
that owns 100% of the Bank's common stock and any successor
thereto.
MID-TIER MERGER - The
conversion of the Mid-Tier Holding Company into
an interim stock
savings bank and subsequent merger with and into the Bank,
which shall occur
immediately prior to
completion of the
Conversion,
as set
forth in this Plan.
MINORITY SHARES - Any outstanding common stock of the Mid-Tier
Holding
Company, or shares of common stock of the Mid-Tier Holding Company
issuable upon
the exercise of options or grant of stock awards, owned by persons other than
the Mutual Holding Company.
MINORITY OWNERSHIP
INTEREST - The
percentage of the Mid-Tier Holding
Company's common
stock held by
stockholders
other than the Mutual Holding
Company immediately prior to the completion of the Conversion.
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MINORITY STOCKHOLDER - Any owner of Minority Shares.
MUTUAL HOLDING
COMPANY - Atlantic Coast Federal, MHC, the mutual
holding company of the Mid-Tier Holding Company.
OFFERING - The offering and issuance, pursuant to this Plan, of
Holding
Company Common Stock
in a Subscription
Offering, Community Offering and/or
Syndicated Community Offering, as the case may be. The term
"Offering" does not
include Holding Company Common Stock issued in the Exchange
Offering.
OFFERING RANGE - The
range of the number of shares of Holding Company
Stock offered for sale in the Offering multiplied by the
Subscription Price. The
Offering Range shall
be equal to the
Appraised Value Range
multiplied by the
Majority Ownership Interest, divided by the Subscription Price.
The maximum and
minimum of the
Offering Range may vary as much as 15%
above and 15% below,
respectively, the midpoint of the Offering Range.
OFFICER - An executive
officer of the Bank, the Mid-Tier Holding
Company, the Holding Company or the Mutual Holding Company as
appropriate in the
context, which
includes the Chief
Executive Officer,
President,
Senior Vice
Presidents, Executive
Vice President in charge of principal business functions,
Secretary and Controller and any Person performing functions similar to those
performed by the foregoing persons.
ORDER FORM
- Any form (together with any cover letter and
acknowledgments) sent to any Participant or Person containing among
other things
a description of the alternatives available to such Person under
the Plan and by
which any such Person may make elections regarding subscriptions for
Subscription Shares.
OTHER MEMBER - Any
person holding a Deposit Account on the Voting
Record Date who is not
an Eligible
Account Holder or Supplemental Eligible
Account Holder.
OTS - The Office of Thrift Supervision, a division of the United
States
Department of Treasury.
PARTICIPANT - Any Eligible Account Holder, Employee Plan, Supplemental
Eligible Account Holder, or Other Member.
PERSON - An individual, a corporation, a partnership, an
association, a
joint-stock company,
a limited liability
company, a trust, an unincorporated
organization, or a government or political subdivision of a
government.
PLAN - This Plan of Conversion and Reorganization of the Mutual
Holding
Company as it exists on the date hereof and as it may hereafter be amended in
accordance with its terms.
PROSPECTUS - The one or more documents used in offering the
Conversion
Stock.
QUALIFYING DEPOSIT -
The aggregate balance
of all Deposit Accounts in
the Bank of (i) an
Eligible Account
Holder at the close of business on the
Eligibility Record
Date, provided such
aggregate balance is not less than $50,
and (ii) a Supplemental Eligible Account Holder at the
close of business on the
Supplemental
Eligibility Record
Date, provided such
aggregate balance is
not
less than $50.
5
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RESIDENT - Any Person who occupies a dwelling within the Community,
has
a present intent to
remain within the Community for a period of time, and
manifests the
genuineness of that intent by establishing an ongoing physical
presence within the
Community together
with an indication
that such presence
within the Community is something other than merely transitory in
nature. To the
extent the person is a corporation or other business entity, the
principal place
of business or headquarters shall be in the Community. To the
extent a person is
a personal benefit plan, the circumstances of the beneficiary
shall apply with
respect to
this definition. In the case of all other benefit plans,
circumstances of the
trustee shall be examined for purposes of this definition.
The Mutual Holding
Company and the Bank may utilize deposit or loan records or
such other
evidence provided to it to make a determination as to whether a
person is a resident.
In all cases, however,
such a determination
shall be in
the sole discretion of
the Mutual Holding
Company and the Bank.
A Participant
must be a "Resident" for purposes of determining whether such person "resides"
in the Community as such term is used in this Plan.
SEC - The Securities and Exchange Commission.
SPECIAL MEETING OF
MEMBERS - The special meeting of Voting Members and
any adjournments thereof held to consider and vote upon this
Plan.
SUBSCRIPTION
OFFERING -
The offering of Subscription Shares to
Participants.
SUBSCRIPTION PRICE -
The price per
Subscription
Share to be paid
by
Participants and
others in the Offering. The Subscription Price will be
determined by the
Board of Directors of the Holding Company and fixed prior to
the commencement of the Subscription Offering.
SUBSCRIPTION SHARES -
Shares of Holding
Company Common Stock
offered
for sale in the Offering. Subscription Shares do not include shares of
Holding
Company Common Stock
issued in exchange
for Minority Shares in the Exchange
Offering.
SUPPLEMENTAL ELIGIBLE ACCOUNT HOLDER - Any Person, other than
Directors
and Officers of the Bank and the Mid-Tier Holding Company and their
Associates,
holding a Qualifying Deposit on the Supplemental Eligibility Record
Date, who is
not an Eligible Account Holder.
SUPPLEMENTAL
ELIGIBILITY RECORD
DATE - The date for determining
Supplemental Eligible
Account Holders, which shall be the last day of the
calendar quarter preceding OTS approval of the application for
conversion.
SYNDICATED COMMUNITY OFFERING - The offering of Subscription
Shares, at
the sole discretion
of the Holding
Company, following the Subscription and
Community Offerings through a syndicate of broker-dealers.
TAX-QUALIFIED EMPLOYEE STOCK BENEFIT PLAN - Any defined benefit
plan or
defined contribution plan, such as an employee stock ownership
plan, stock bonus
plan, profit-sharing
plan or other plan,
which, with its related trust, meets
the requirements
to be "qualified"
under Section 401 of
the Internal
Revenue
Code. The Bank may make scheduled discretionary contributions to a
tax-qualified
employee stock benefit plan, PROVIDED such contributions do not cause the
Bank
to fail to meet
its regulatory capital requirements. A "Non-Tax-Qualified
Employee Stock Benefit Plan" is any defined benefit plan or defined
contribution
plan which is not so qualified.
6
<PAGE>
VOTING MEMBER - Any
Person who at the close of business on the Voting
Record Date is
entitled to vote as a Member of the Mutual Holding Company
pursuant to its charter and bylaws.
VOTING RECORD DATE - The date fixed by the Directors for determining
eligibility to vote at
the Special
Meeting of Members
and/or the
Meeting of
Stockholders.
3. PROCEDURES FOR CONVERSION
1. After approval of
the Plan by the Boards of Directors of the Bank,
the Mid-Tier
Holding Company, the Holding Company and the Mutual Holding
Company, the Plan
together with all other requisite material shall be submitted
to the OTS for
approval. Notice
of the adoption of the Plan by the Board of
Directors of the Bank and the Board of Directors of the Mutual
Holding Company
and the Mid-Tier
Holding Company and
the submission of the Plan to the OTS for
approval will be published in a newspaper having general circulation in each
community in which an office of the Bank is located, and copies of
the Plan will
be made available at each office of the Bank for inspection by depositors.
The
Mutual Holding Company
also will publish a notice of the filing with the OTS of
an application to convert in accordance with the provisions of the
Plan.
2. Promptly following
approval by the OTS,
the Plan will be submitted
to a vote of (i) the Voting Members at the Special Meeting of
Members, and (ii)
the Minority
Stockholders
of the Mid-Tier
Holding Company at the Meeting of
Stockholders. The
Mutual Holding Company
will mail to all Voting Members, at
their last known address appearing on the records of the Bank, a
proxy statement
in either long or summary form describing the Plan, which will be
submitted to a
vote of Voting Members at the Special Meeting of Members.
The Mid-Tier
Holding
Company will mail to all Minority Stockholders a proxy statement
describing the
Plan, which will be submitted to a vote of Minority Stockholders at the Meeting
of Stockholders. The Holding Company also will mail to all
Participants either a
Prospectus and Order
Form for the purchase of Subscription Shares or a letter
informing them of
their right to
receive a Prospectus and Order Form and a
postage prepaid card to request such materials, subject to other provisions of
this Plan.
In addition, all Participants will receive, or be given the
opportunity to request by either telephone or by letter addressed
to the Bank's
Secretary, a copy of the Plan as well as the articles of
incorporation or bylaws
of the Holding Company. Upon approval of the Plan by at
least (i) a majority of
the total number of votes entitled to be cast by Voting Members,
(ii) two-thirds
of the outstanding
common stock of the Mid-Tier Holding Company, and (iii) a
majority vote of the
outstanding
shares owned by
Minority Stockholders,
the
Mutual Holding
Company, the Holding Company and the Bank will take all
other
necessary steps
pursuant to applicable
laws and regulations
to consummate the
Conversion. The Conversion must be completed within 24 months of
the approval of
the Plan by Voting
Members, unless a longer time period is permitted by
governing laws and regulations.
7
<PAGE>
3. The period for the
Subscription Offering
will be not less than
20
days nor more than 45 days and the period for the Community
Offering will be not
more than 45 days, unless extended by the Holding Company and the
Bank. If, upon
completion of the Subscription Offering and any Community
Offering, any
shares
of Common Stock remain
available for sale,
such shares will, if
feasible, be
offered for sale in a
Syndicated
Community Offering. If for any reason the
Syndicated Community
Offering of all shares not sold in the Subscription
Offering and Community Offering cannot be effected, the Holding Company and the
Bank will use their best efforts to obtain other purchasers, subject to OTS
approval. Completion
of the sale of all shares of Holding Company Common Stock
not sold in the Subscription Offering and Community Offering is
required within
45 days after termination of the Subscription Offering,
subject to extension
of
such 45-day period by the Holding Company and the Bank with the
approval of the
OTS.
4. The Conversion will
be effected as follows, or in any other manner
that is consistent
with the purposes of this Plan and applicable laws and
regulations, including
a merger of the Mutual Holding Company into the Mid-Tier
Holding Company followed immediately by the Offering. The choice of
which method
to use to effect the
Conversion will be
made by the Board of
Directors of the
Mutual Holding Company immediately prior to the closing of the
Conversion. Each
of the steps
set forth below shall be deemed to occur in such order as is
necessary to consummate the Conversion pursuant to the Plan, the intent
of the
Boards of Directors of the Mutual Holding Company, the Mid-Tier Holding Company
and the Bank, and applicable federal and state regulations and
policy. Approval
of the Plan by Voting Members and Minority Stockholders of the Mid-Tier
Holding
Company also shall constitute approval of each of the transactions
necessary to
implement the Plan.
(a) The Bank
will establish
the Holding
Company as a
first-tier
Maryland-chartered stock holding company subsidiary.
(b) The
Holding Company will charter Interim.
(c) The Mid-Tier
Holding Company will
convert to an interim stock
savings bank and merge
with and into the Bank (the "Mid-Tier
Merger") with the Bank as the resulting entity pursuant to the
Agreement of Merger
attached hereto as
Exhibit A between the
Mid-Tier Holding
Company and the Bank, whereby the Mutual
Holding Company will receive, and Minority Stockholders will
constructively
receive, shares
of Bank common stock in
exchange for their Mid-Tier Holding Company common stock.
(d)
Immediately after the
Mid-Tier Merger, the Mutual Holding
Company will convert to an interim stock savings bank and will
merge with and into the Bank (the "MHC Merger") pursuant to
the Agreement of Merger attached hereto as Exhibit B between
the Mutual Holding Company and the Bank, whereby the shares of
Bank common stock held by the Mutual Holding Company will be
canceled and each
Eligible Account
Holder and
Supplemental
Eligible Account
Holder will receive an interest in a
Liquidation Account of
the Bank in exchange for such person's
interest in the Mutual Holding Company.
8
<PAGE>
(e)
Immediately after the
Mid-Tier Merger and the MHC Merger,
Interim will merge with and into the Bank with the Bank as the
surviving entity (the "Bank Merger") pursuant to the Agreement
of Merger between
the Bank and
Interim attached hereto as
Exhibit C, whereby the Bank will become the subsidiary of the
Holding Company.
Constructive shareholders of the Bank (i.e.,
Minority Stockholders
immediately
prior to the
Conversion)
will
exchange the shares of Bank common stock that they
constructively
received in the
Mid-Tier Merger for Holding
Company Common Stock.
(f)
Immediately after the
Bank Merger, the
Holding Company
will
sell the Subscription Shares in the Offering.
5. As part
of the Conversion, each of the Minority Shares shall
automatically, without
further action of the holder thereof, be converted into
and become the right to receive Holding Company Common Stock based upon the
Exchange Ratio.
The basis for exchange
of Minority Shares for
Holding Company
Common Stock
shall be fair and
reasonable.
Options to purchase shares of
Mid-Tier Holding Company common stock which are outstanding
immediately prior to
the consummation of
the Conversion shall
be converted into options to purchase
shares of Holding Company Common Stock, with the number of shares
subject to the
option and the exercise price per share to be adjusted
based upon the
Exchange
Ratio so that the
aggregate exercise
price remains unchanged, and with the
duration of the option remaining unchanged.
6. The Holding Company shall register the Conversion Stock with the
SEC
and any appropriate
state securities
authorities.
In addition,
the Mid-Tier
Holding Company
shall prepare preliminary proxy materials as well as other
applications and
information
for review by the SEC in connection with the
solicitation of Minority Stockholder approval of the Plan.
7. All assets, rights,
interests, privileges,
powers, franchises
and
property (real,
personal and mixed) of
the Mid-Tier Holding
Company shall be
automatically
transferred to and vested in the Holding Company by virtue of
the
Conversion without any deed or other document of transfer.
The Holding
Company,
without any order or
action on the part of any court or otherwise and without
any documents
of assumption or assignment, shall hold and enjoy all of
the
properties,
franchises and
interests,
including
appointments,
powers,
designations,
nominations and all
other rights and
interests as the agent
or
other fiduciary
in the same
manner and to the same extent as such rights,
franchises, and
interests and powers were held or enjoyed by the Mid-Tier
Holding Company.
The Holding Company shall be responsible for all of the
liabilities,
restrictions and
duties of every kind and description of the
Mid-Tier Holding
Company immediately prior to the Conversion, including
liabilities for all
debts, obligations
and contracts of the
Mid-Tier Holding
Company, matured
or unmatured, whether accrued, absolute, contingent or
otherwise and whether
or not reflected or reserved against on balance sheets,
books of accounts or records of the Mid-Tier Holding Company.
8. The Articles of
Incorporation
and Bylaws of the
Holding Company
shall read in the form of Exhibit D and Exhibit E,
respectively.
9
<PAGE>
9. The home office and branch office of the Bank shall be
unaffected by
the Conversion. The executive offices of the Holding Company shall
be located at
the current offices of the Mutual Holding Company and Mid-Tier
Holding Company.
4. HOLDING COMPANY APPLICATIONS AND APPROVALS
The Boards of Directors of the Mutual Holding Company, the Mid-Tier
Holding Company, the
Holding Company and the Bank will take all necessary steps
to convert the Mutual Holding Company to stock form,
form the Holding
Company
and complete the Offering. The Holding Company shall make timely
applications to
the OTS and filings
with the SEC for any
requisite regulatory approvals to
complete the Conversion.
5. SALE OF SUBSCRIPTION SHARES
The Subscription
Shares
will be offered simultaneously in the
Subscription Offering to the Participants in the respective
priorities set forth
in this Plan. The Subscription Offering may begin as early as the
mailing of the
proxy statement for the Special Meeting of Members. The Holding Company Common
Stock will not be insured by the FDIC. The Bank will not extend
credit to any
Person to purchase shares of Holding Company Common Stock.
Any shares of Holding Company Common Stock for which subscriptions
have
not been received in
the Subscription
Offering may be issued
in the Community
Offering, subject
to the terms and
conditions
of this Plan. The Community
Offering may begin simultaneously or later than the Subscription
Offering. The
offer and sale of Holding Company Common Stock prior to the
Special Meeting of
Members, however,
is subject to the
approval of the Plan by Voting Members and
Minority Stockholders of the Mid-Tier Holding Company.
If feasible, any shares of Holding Company Common Stock remaining
after
the Subscription
Offering period, and the Community Offering period, should one
be conducted, may be
sold in a Syndicated
Community Offering or
in any manner
that will achieve the widest distribution of the Holding Company Common
Stock.
The Syndicated
Community Offering may be conducted in
addition to, or instead
of, a Community
Offering.
