PLAN OF MERGER AND
REORGANIZATION
EMBASSY BANK FOR THE LEHIGH VALLEY (the "Bank"),
a banking institution organized under the Pennsylvania Banking Code
of 1965, as amended (the "Banking Code"), and EMBASSY INTERIM BANK
(the "Surviving Bank"), an interim bank in organization under the
Banking Code, and EMBASSY BANCORP, INC. (the "Holding
Company"), a Pennsylvania business corporation organized under the
Pennsylvania Business Corporation Law of 1988, as amended, hereby
enter into this Plan of Merger and Reorganization (the
"Plan").
In consideration of their mutual promises and
covenants, the parties hereto, deeming it to be advantageous to
their respective banking associations, corporation and their
shareholders, have duly approved this Plan and its execution, and
do hereby adopt this Plan setting forth the method, terms and
conditions of the merger, including the rights under the Plan of
the shareholders of each of the parties, and the agreements
concerning the merger:
1.
Merger . The Bank shall merge into the Surviving
Bank under the charter of the Surviving Bank, under the title of
"Embassy Bank for the Lehigh Valley", and pursuant to the
provisions of the Banking Code, by the method, on the terms and
subject to the conditions and requirements hereinafter stated. Upon
the merger becoming effective, Bank and Surviving Bank shall be
merged into and continued in a single institution, the Surviving
Bank, which shall he a Pennsylvania chartered bank and which shall
be considered the same business and corporate entity as the
constituent institutions. The Surviving Bank shall
thenceforth be responsible for all of the liabilities and
obligations of the Bank. The Surviving Bank shall, upon
consummation of the merger, engage in the business of a
Pennsylvania chartered bank at the principal office and the legally
established and approved branch offices of the Bank. Surviving Bank
shall maintain the insurance of the Federal Deposit Insurance
Corporation in the same way as it is now carried by the
Bank.
2.
Articles of Incorporation of Surviving Bank . When the
merger becomes effective, the Articles of Incorporation of the
Surviving Bank shall be substantially in the form attached hereto
as Exhibit "A" and by this reference incorporated
herein.
3.
By-Laws of Surviving Bank . When the merger
becomes effective, the By-Laws of the Surviving Bank shall be
substantially in the form attached hereto as Exhibit "B" and by
this reference incorporated herein (subject to change as authorized
by statute or By-Laws), and the principal office and established
and authorized branch offices of the Bank shall become the
principal office and established and authorized branch offices,
respectively, of the Surviving Bank.
4.
Board of Directors of Surviving Bank
. The persons who shall constitute the Board
of Directors of the Surviving Bank at the time the merger becomes
effective shall be the persons who were then members of the Board
of Directors of the Bank; they shall serve until the subsequent
annual meeting of shareholders of Surviving Bank or until their
successors are duly qualified and elected. Any vacancy in the Board
of Directors of the Surviving Bank which may exist upon or after
the effective date of the merger may be filled as provided by the
Articles of Incorporation and By-Laws of the Surviving
Bank. The officers of the Bank at the time the
merger becomes effective shall hold the same offices in the
Surviving Bank.
5.
Conversion of Shares: Exchange of Certificates:
Capitalization . Upon the merger becoming effective:
(a) Each
issued and outstanding share of common stock of the Bank
represented by an outstanding stock certificate shall, ipso facto,
and without any action on the part of the holder thereof, become
and be converted into one (1) share of common stock of the Holding
Company, par value $1.00 per share. As soon as
practicable after the merger becomes effective, holders of shares
of Bank common stock shall be furnished a form letter of
transmittal for the tender of their shares to the Surviving Bank,
which shall act as Exchange Agent for the Holding Company, to be
exchanged for new certificates for the appropriate number of shares
of Holding Company common stock. Holding Company shall
be required to issue certificates for Holding Company common stock
only upon the actual surrender of Bank shares and may require an
indemnity agreement or bond from any Bank shareholder who is unable
to surrender his or her certificate by reason of loss or
destruction of the certificate. Upon surrender for
cancellation to the Exchange Agent of one or more certificates for
shares of Bank common stock, accompanied by a duly executed letter
of transmittal in proper form, the Exchange Agent shall, promptly
after the effective date of the merger, deliver to each holder of
such surrendered Bank certificates new certificates representing
the appropriate number of shares of Holding Company common stock.
Until certificates for Bank common stock have been surrendered and
exchanged as herein provided for certificates of Holding Company
common stock, each outstanding certificate for Bank common stock
shall be deemed, for all corporate purposes of the Holding Company,
to be the number of full shares of Holding Company common stock
into which the number of shares of Bank common stock shown thereon
have been converted. In the event that any certificates
for Bank common stock are not surrendered for exchange within two
(2) years from the effective date of the merger, the shares of
Holding Company common stock that would otherwise have been
delivered in exchange for the unsurrendered Bank certificates shall
be delivered by the Exchange Agent to the Holding Company, in which
event the persons entitled thereto shall look only to the Holding
Company for delivery of the Holding Company shares upon surrender
of their outstanding certificates for Bank common stock. Following
the expiration of such two (2) year period, the Holding Company may
sell such unclaimed Holding Company common stock, in which event
the sole right of the holders of the unsurrendered outstanding Bank
certificates shall be the right to collect the net sale proceeds
held for their account by the Holding Company. In the
event that Holding Company shall, as required or permitted by law,
pay to the Commonwealth of Pennsylvania any net sale proceeds
relating to unclaimed Holding Company common stock, the holders of
unsurrendered outstanding Bank certificates shall thereafter look
only to the Commonwealth of Pennsylvania for payment on account
thereof.
(b) Prior
to the merger becoming effective, the Surviving Bank will have a
capital of $100,000 consisting of 100,000 issued and outstanding
shares of common stock, par value $1.00 per share, and a surplus of
$55,000. Upon the merger becoming effective, the amount and
number of issued and outstanding shares of common
stock of the Surviving Bank shall be increased, at the time the
merger becomes effective, to an amount equal to the total of the
issued and outstanding shares of common stock of the Bank, now
being 6,888,024 shares of common stock, par value $1.00 per share,
and of the Surviving Bank immediately before the m
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