ASSET PURCHASE AGREEMENT

Exhibit 2.2

 

ASSET PURCHASE AGREEMENT

between

FISERV, INC,

LINCOLN TRUST COMPANY

and

ROBERT BERIAULT HOLDINGS, INC.

 

Dated as of April 15, 2009

 

 

TABLE OF CONTENTS

 

 

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ASSET PURCHASE AGREEMENT

ASSET PURCHASE AGREEMENT dated as of April 15, 2009 (the “ Agreement ”), between Fiserv, Inc., a Wisconsin corporation (“ Fiserv ”), Lincoln Trust Company, a Colorado corporation (“ Seller ”), and Robert Beriault Holdings, Inc., a Colorado corporation (“ Buyer ”).

W I T N E S S E T H :

WHEREAS, Seller is engaged in providing administrative services to (i) self directed IRA and defined contribution accounts that hold both traditional and alternative investments, (ii) balance forward retirement plans, and (iii) daily valuation retirement plans (the business referred to in subsections (i), (ii), and (iii) are collectively, the “ Business ”);

WHEREAS, Buyer desires to purchase substantially all of the assets and properties used by Seller in and relating to the Business, subject to certain liabilities, on the terms and conditions described in this Agreement; and

WHEREAS, Buyer and Seller desire to make certain representations, covenants and agreements in connection with the purchase and sale of the Assets (as hereinafter defined) and also to prescribe various conditions to the transaction.

NOW, THEREFORE, in consideration of the mutual promises, covenants and representations made herein and intending to be bound hereby, the parties hereto agree as follows:

ARTICLE I.

SALE AND PURCHASE OF ASSETS

1.1. Basic Transaction .

1.1.1 Assets . On and subject to the terms and conditions of this Agreement, Buyer agrees to purchase from Seller, and Seller agrees to sell, convey, transfer and deliver to Buyer, all of the following assets and properties of Seller as the same shall exist on the Closing Date, except those assets excluded pursuant to Section 1.1.2 below, set forth on Schedule 1.1.2 to this Agreement, or set forth in the Stock Purchase Agreement (collectively, the “Assets”) for the consideration specified below in Section 1.2:

(i) all rights of Seller and all other contracts and agreements to which the Seller is a party or by which the Seller is bound that are attributable to, used or, to the extent still in existence, previously used, or otherwise reasonably necessary to, or for use primarily in connection with, the operation or conduct of the Business;

(ii) all Intellectual Property relating to the Assets, including the marks LINCOLN TRUST and LINCOLN TRUST COMPANY and the application of registration filed with the United States Patent and Trademark Office, bearing application serial number 77/333724 (the “Marks”);

(iii) all accounts receivable, notes receivable, and other receivables due to the Seller that are attributable to, or arise out of the operation of the Business, together with any unpaid interest or fees accrued thereon or other amounts due with respect thereto;

(iv) all machinery, equipment, furniture, furnishings, parts, spare parts, inventories, computer systems, supplies, and other tangible personal property owned by Seller and used or held that are attributable to, used or, to the extent still in existence, previously used, or otherwise reasonably necessary to, or for use primarily in connection with, the operation or conduct of the Business;

(v) all permits and certificates used or held that are attributable to, used or, to the extent still in existence, previously used, or otherwise reasonably necessary to, or for use primarily in connection with, the operation or conduct of the Business;

(vi) all books of account, general, financial, accounting and personnel records, files, invoices, customers’ and suppliers’ lists, other distribution lists, billing records, sales and promotional literature, manuals and customer and supplier correspondence owned by the Seller that are attributable to, used or, to the extent still in existence, previously used, or otherwise reasonably necessary to, or for use primarily in connection with, the operation or conduct of the Business;

(vii) all credits and prepaid expenses that are attributable to, used or, to the extent still in existence, previously used, or otherwise reasonably necessary to, or for use primarily in connection with, the operation or conduct of the Business; and

(viii) All rights under the Smart 401(k) Plan and all other employee, benefit or retirement plan of Seller listed on Schedule 1.1.1(viii) , including all assets related thereto; and

1.1.2 Excluded Assets . The following assets and properties of Seller are specifically excluded from the Assets and shall be retained by Seller (the “ Excluded Assets ”):

(i) all of Seller’s cash and cash equivalents;

(ii) the Seller’s corporate books and records of internal corporate proceedings, tax records, work papers, and books and records that the Seller is required by Applicable Law to retain;

(iii) all rights in and to the Retained Names (as hereinafter defined);

(iv) all of Seller’s bank accounts;

(v) all accounting records (including records relating to Taxes) and internal reports relating to the business activities of Seller that are not Assets;

(vi) any interest in or right to any refund of Taxes relating to the Business, the Assets or the liabilities assumed by Buyer for, or applicable to, any taxable period (or portion thereof) ending on or prior to the Closing Date;

 

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(vii) any insurance policies and rights, claims or causes of action thereunder;

(viii) all rights, claims, and causes of action relating to any Excluded Asset or any other obligations or liabilities which are not assumed by Buyer hereunder;

(ix) all rights of Seller under this Agreement and the Bill of Sale (as hereinafter defined); and

(x) all other assets or agreements listed in Schedule 1.1.2(x) to this Agreement.

1.1.3 Instruments of Conveyance and Transfer . Subject to Section 1.1.6 below, on the Closing Date Seller shall execute and deliver to Buyer (a) a bill of sale in the form included in the Bill of Sale, Assignment and Assumption Agreement annexed hereto as Exhibit A (the “ Bill of Sale ”), transferring to Buyer the properties and assets to be acquired by Buyer under the terms of this Agreement, and (b) such other bills of sale, instruments of assignment and other appropriate documents as may be reasonably requested by Buyer in order to carry out the intentions and purposes of this Agreement.

1.1.4 Assumed Liabilities. On the Closing Date, Buyer shall execute and deliver to Seller an assumption agreement in the form of the Bill of Sale, pursuant to which, subject to Section 1.1.5 below, Buyer shall assume and agree to pay, perform and discharge when due the liabilities and obligations of Seller with respect to the Assets acquired by Buyer hereunder (i) of any kind or nature, whether absolute, contingent or otherwise, which are liabilities or obligations of Seller which arise after the Closing Date under the terms of a contract, agreement, license or lease or other commitment, (ii) that are included as liabilities on the Closing Balance Sheet and all liabilities relating to the Business which are not required by GAAP to be reflected or reserved against in the Closing Balance Sheet or the notes thereto, (iii) that arise under any employee or retiree benefit plan of Seller, including without limitation the Smart 401(k) Plan, whether arising before or after the Closing, or (iv) that arise after the Closing Date and pertain to events occurring after the Closing Date or arising out of or relating to the ownership or use of the Assets from or after the Closing Date (the foregoing in subsections (i), (ii), (iii), and (iv) are collectively, the “ Assumed Liabilities ”):

1.1.5 Excluded Liabilities . Buyer is not assuming, and shall not be deemed to have assumed, any liabilities or obligations of Seller of any kind or nature whatsoever, except as expressly provided above in Section 1.1.4 hereof, including without limitation, (i) any liability arising on or prior to the Closing Date, (ii) any Taxes of Seller, its Subsidiaries or Affiliates or for which Seller or any of its Subsidiaries or Affiliates is or may be liable, without regard to when such Tax is due or payable, or (iii) arising out of any action, suit or proceeding based upon an event occurring or a claim arising (A) on or prior to the Closing Date or (B) after the Closing Date in the case of claims in respect of services delivered by Seller on or prior to the Closing Date and attributable to acts performed or omitted by Seller on or prior to the Closing Date (the foregoing are collectively, the “ Excluded Liabilities ”).

 

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1.1.6 Consents to Certain Assignments .

(i) Notwithstanding anything in this Agreement to the contrary, this Agreement shall not constitute an agreement to transfer or assign any asset, permit, claim or right or any benefit arising thereunder or resulting therefrom if an attempted assignment thereof, without the consent of a third party, would constitute a breach or other contravention under any agreement or Applicable Law to which the Seller is a party or by which it is bound, or in any way adversely affect the rights of the Seller or, upon transfer, the Buyer under such asset, permit, claim or right. The Seller shall use its commercially reasonable efforts to obtain any consents or waivers required to assign to the Buyer any Asset that requires the consent of a third party, without any conditions to such transfer or changes or modifications of terms thereunder. The Buyer agrees that the Seller shall not have any liability to the Buyer arising out of or relating to the failure to obtain any such consent that may be required in connection with the transactions contemplated by this Agreement or because of any circumstances resulting therefrom. The Buyer further agrees that no representation, warranty or covenant of the Seller herein shall be breached or deemed breached, and no condition shall be deemed not satisfied, as a result of (i) the failure to obtain any such consent or any circumstances resulting therefrom or (ii) any suit, action, proceeding or investigation commenced or threatened by or on behalf of any Person arising out of or relating to the failure to obtain any such consent or any circumstances resulting therefrom.

(ii) If any such consent is not obtained prior to Closing and as a result thereof the Buyer shall be prevented by such third party from receiving the rights and benefits with respect to such Asset intended to be transferred hereunder, or if any attempted assignment would adversely affect the rights of the Seller thereunder so that the Buyer would not in fact receive all such rights or the Seller would forfeit or otherwise lose the benefit of rights that the Seller is entitled to retain, the Seller and the Buyer shall cooperate in any lawful and commercially reasonable arrangement, as the Seller and the Buyer shall agree, under which the Buyer would, to the extent practicable, obtain the economic claims, rights and benefits under such asset and assume the economic burdens and obligations with respect thereto in accordance with this Agreement, including by subcontracting, sublicensing or subleasing to the Buyer; provided that all reasonable out-of-pocket expenses of such cooperation and related actions shall be paid by the Buyer. The Seller shall promptly pay to the Buyer when received all monies received by the Seller under such Asset or any claim or right or any benefit arising thereunder and the Buyer shall indemnify and promptly pay the Seller for all liabilities of the Seller associated with such Asset.

1.2. Preliminary Purchase Price .

Preliminary Purchase Price . Buyer agrees to pay to the Seller on the date set forth in Section 1.3 below the Net Book Value of the Assets as set forth on the Preliminary Schedule, each as further described in Section 1.5 below for the Assets (the “ Preliminary Purchase Price ”) by delivery of cash payable by wire transfer of immediately available funds to an account specified by Seller. The Preliminary Purchase Price will be subject to post-Closing adjustment as set forth in Section 1.6.

1.3. The Closing . The closing of the transactions contemplated by this Agreement (the “ Closing ”) shall take place at the offices of Seller, 255 Fiserv Drive, Brookfield, Wisconsin 53045, commencing at 9:00 a.m. local time on the fifth Business Day following the satisfaction or waiver of all conditions to the obligations of the parties to consummate the transactions contemplated hereby (other

 

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than conditions with respect to actions the respective parties will take at the Closing itself) or such other date and/or location as Buyer and Seller may mutually determine (the “ Closing Date ”), and shall be effective as of 11:59 p.m. on the Closing Date; provided that in any event the Closing shall occur on the same date as the closing of that certain Amended and Restated Stock Purchase Agreement dated as of the date hereof between Fiserv, Inc. and Robert Beriault Holdings, Inc. (“ Stock Purchase Agreement ”).

1.4. Deliveries .

At the Closing, (i) Seller will deliver to Buyer the certificates referred to in Section 4.2.1 below, (ii) Buyer will deliver to Seller the certificates referred to in Section 4.3.1 below, and (iii) Buyer will deliver to Seller the Preliminary Purchase Price.

1.5. Preparation of Preliminary Schedule and Final Schedule .

1.5.1 Preliminary Schedule and Final Schedule.

(i) Not later than three Business Days prior to the Closing Date, the Seller and Fiserv shall deliver to the Buyer a schedule (the “ Preliminary Schedule ”) setting forth, in reasonable detail and as of the date of the Preliminary Schedule, Seller’s estimate of the amount of the Net Book Value of the Assets. The term “Net Book Value of the Assets” shall mean the difference between the book value of the Assets and the liabilities to be assumed by Buyer, as of the Closing Date, as set forth on the balance sheet as of the Closing Date (the “ Closing Balance Sheet ”). The Preliminary Schedule and Closing Balance Sheet shall be prepared in a manner and on a basis consistent in all respects with the December 31, 2008 audited balance sheet of the Seller, except that the Preliminary Schedule and Closing Balance Sheet shall not include the Excluded Assets and Excluded Liabilities.

(ii) As soon as reasonably practicable, but in no event later than sixty days following the Closing Date, the Buyer shall prepare and deliver to the Seller and Fiserv a schedule (the “ Final Schedule ”) of Buyer’s calculation of the Net Book Value of the Assets. The Final Schedule shall be prepared in a manner and on a basis consistent in all respects with the Preliminary Schedule and Closing Balance Sheet, and in a manner and on a basis consistent in all respects with the December 31, 2008 audited balance sheet of the Seller, except that the Final Schedule shall not include or reflect any Excluded Assets or Excluded Liabilities.

1.5.2 Objections. Within thirty days after receiving the Final Schedule, Seller and Fiserv may object to the schedule by delivering to Buyer a written statement describing its objections (the “ Statement of Objections ”). If Seller or Fiserv fails to deliver a Statement of Objections within such thirty days, the calculations set forth in the Final Schedule shall be conclusive and binding upon Buyer, on the one hand, and Seller and Fiserv on the other hand. If Seller or Fiserv delivers a Statement of Objections within such thirty days, Buyer, on the one hand, and Seller and Fiserv, on the other hand, will use commercially reasonable efforts to resolve any such objections themselves. If Buyer, on the one hand, and Seller and Fiserv, on the other hand, shall fail to reach an agreement with respect to any of the objections set forth in a Statement of Objections within such thirty day period after Buyer has received such Statement of Objections, then such unresolved objections shall be submitted for resolution to PricewaterhouseCoopers LLP (or if

 

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PricewaterhouseCoopers LLP is not independent or able to act, such other nationally recognized accounting firm as may be reasonably satisfactory to Buyer, on the one hand, and Seller and Fiserv, on the other hand) (PricewaterhouseCoopers LLP or such other firm, the “ Accounting Firm ”). The Accounting Firm will resolve any unresolved objections submitted to it within thirty days following its engagement. The Accounting Firm shall make a determination based solely on presentations by Seller, Fiserv and Buyer, and not by independent review, as to (and only as to) each of the items in dispute, and shall be instructed that, in resolving any such item in dispute, it must select a position with respect to the Net Book Value of the Assets and the Final Schedule that is either exactly the position of Seller and Fiserv or exactly the position of Buyer or that is between such position of Seller and Fiserv, on the one hand, and Buyer, on the other hand. Buyer will revise the Final Schedule as appropriate to reflect the resolution of any objections thereto pursuant to this Section 1.5.2. The Final Schedule as may be revised pursuant to this Section 1.5.2 shall be used to determine the Net Book Value of the Assets, as applicable, and any purchase price adjustment as contemplated by Section 1.6.

1.5.3 Expenses . In the event Buyer, Seller and Fiserv submit any unresolved objections to the Accounting Firm for resolution as provided in Section 1.5.2, Buyer, on the one hand, and Seller and Fiserv, on the other hand, will share responsibility for the fees and expenses of the Accounting Firm as follows:

(a) if the Accounting Firm resolves all of the remaining objections contained in the Statement of Objections in favor of Buyer (the final amount as determined by the Accounting Firm is referred to herein as the “ Low Value ”), Seller and Fiserv will be responsible for all of the fees and expenses of the Accounting Firm;

(b) if the Accounting Firm resolves all of the remaining objections contained in the Statement of Objections in favor of Seller and Fiserv (the final amount as determined by the Accounting Firm is referred to herein as the “ High Value ”), Buyer will be responsible for all of the fees and expenses of the Accounting Firm; and

(c) if the Accounting Firm resolves some of the remaining objections contained in the Statement of Objections in favor of Buyer and the rest of the remaining objections in favor of Seller and Fiserv (the final amount as determined by the Accounting Firm is referred to herein as the “ Actual Value ”), Seller and Fiserv will be responsible for a percentage of the fees and expenses of the Accounting Firm in connection with the resolution of such objections equal to (x) the difference between the High Value and the Actual Value over (y) the difference between the High Value and the Low Value, and Buyer will be responsible for the remainder of the fees and expenses.

1.5.4 Work Papers . Buyer will make the work papers and back-up materials used in preparing the Final Schedule, and the books, records, and financial staff of Buyer and its Affiliates, available to Seller and Fiserv and their accountants and other representatives at reasonable times and upon reasonable notice at any time during (A) the preparation by Buyer of the Final Schedule, (B) the review by Seller and Fiserv of the Final Schedule, and (C) the resolution by Buyer, on the one hand, and Seller, on the other hand, of any objections thereto.

 

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1.6. Adjustment to Preliminary Purchase Price

The Preliminary Purchase Price will be adjusted as follows, and as so adjusted is referred to herein as the “ Purchase Price .”

(i) If the Net Book Value of the Assets set forth on the Final Schedule exceeds the Net Book Value of the Assets set forth on the Preliminary Schedule, Buyer will pay to Seller an amount equal to such excess by wire transfer or delivery of other immediately available funds within three Business Days after the date on which the Final Schedule finally is determined pursuant to Section 1.5 above.

(ii) If the Net Book Value of the Assets set forth on the Final Schedule is less than the Net Book Value of the Assets set forth on the Preliminary Schedule, Seller will pay to Buyer an amount equal to such deficiency by wire transfer or delivery of other immediately available funds within three Business Days after the date on which the Final Schedule finally is determined pursuant to Section 1.5 above.

1.7 Allocation of Purchase Price .

1.7.1 Allocation. After a thorough analysis of the transaction and arms’ length negotiations between the parties, Buyer and Seller agree that the Purchase Price shall be allocated among the Assets as set forth on the Closing Balance Sheet.

1.7.2 Cooperation. Buyer and Seller will cooperate in the timely preparation of their respective Forms 8594 with respect to the sale of the Assets and payments hereunder in accordance with this Section 1.7. For purposes of the preparation of Form 8594, the name, address and taxpayer identification number of Buyer is as follows:

 

 

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Buyer and Seller shall promptly give the other parties notice, in accordance with Section 7.4 herein, of any changes in the foregoing information prior to the due date of any Form 8594.

(iii) Binding Effect. Buyer and Seller shall be bound by the allocation of the Purchase Price as set forth in this Section 1.7, and shall apply such allocation for all purposes, including determining any Tax, shall prepare and file all Tax Returns, including Form 8594, in a manner consistent with such allocations, and shall not take any position inconsistent with such allocation in any Tax Return, proceeding before any Taxing authority or otherwise. In the event that any allocation hereunder is questioned, audited or disputed by any Taxing authority, the party receiving notice thereof shall promptly notify and consult with the other parties concerning the strategy for the resolution thereof, and shall keep the other parties apprised of the status of such question, audit or dispute and the resolution thereof.

ARTICLE II.

REPRESENTATIONS

2.1. Representations of Seller . Except for breaches that would not occur but for the taking of any actions contemplated by or in connection with this Agreement or the transactions contemplated hereby, Seller represents to Buyer as follows:

2.1.1. Authorization; No Conflicts; Status of Seller, etc .

(a) Due Organization, etc . Seller is a corporation, duly organized, validly existing and in good standing under the laws of the State of Colorado with the requisite corporate power and authority, as applicable, to carry on the Business as now conducted and to own or lease and to operate its properties as and in the places where such Business is now conducted and such properties are now owned, leased or operated.

(b) Authorization, etc . Seller has all requisite corporate power and authority to enter into this Agreement, to perform its obligations hereunder and to consummate the transactions contemplated hereby to be consummated by it. The execution and delivery of this Agreement, and the consummation of the transactions contemplated hereby, by Seller have been duly authorized by all requisite corporate action of Seller. This Agreement has been duly executed and delivered by Seller and constitutes the valid and legally binding obligation of Seller, enforceable against Seller in accordance with its terms.

(c) No Conflicts . The execution and delivery of this Agreement by Seller and the consummation by Seller of the transactions contemplated hereby will not contravene, result in any violation of, loss of rights or default under, constitute an event creating rights of acceleration, termination, repayment or cancellation under, entitle any party to receive any payment or benefit pursuant to, or result in the creation of any Lien upon any of the Assets under, (i) any provision of the Organizational Documents of Seller, or (ii) any Applicable Law applicable to the Seller or to the Assets, in each case except for any such contraventions, violations, losses, defaults, accelerations, terminations, repayments, cancellations or Liens that, individually or in the aggregate, are not reasonably expected to have a Material Adverse Effect on the Assets. No Governmental Approval (other than as may be required pursuant to the Change in Bank Control Act, the Bank Merger Act, the Colorado Revised Statutes, or as may be required by the

 

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Office of the Comptroller of the Currency (“ OCC ”) or the Federal Deposit Insurance Corporation (“ FDIC ”)) or other Consent is required to be obtained or made by the Seller in connection with the execution and delivery of this Agreement by Seller or the consummation by Seller of the transactions contemplated hereby.

(d) Title . Seller has good and marketable title to (or in the case of leased assets, a valid leasehold interest in) all of the Assets, free and clear of any encumbrances (other than Permitted Encumbrances), except as reflected in the Closing Balance Sheet.

2.1.2. Absence of Changes Except with respect to actions taken in connection with the proposed sale of the trust business of Seller, including without limitation, the sale of the stock or assets of Fiserv Trust Company, Fiserv Affinity, Inc., Seller, and Fiserv Brokerage Services, Inc., or otherwise in connection with the transactions contemplated by this Agreement, since December 31, 2008, (i) Seller with respect to the Business has conducted its business in the ordinary and usual course consistent with past practices and (ii) no event has occurred or fact or circumstance has arisen that, individually or taken together with all other events, facts, and circumstances has had, or is reasonably expected to have, a Material Adverse Effect on the Assets.

2.1.3. Compliance with Laws. Seller with respect to the Business is not in material violation of or material default under, or has at any time since December 31, 2006 materially violated or been in material default under, (i) any Applicable Law applicable to the Business or the Assets or (ii) any provision of its Organizational Documents. Except as set forth on Schedule 2.1.3 to this Agreement, there are no consent decrees or other similar agreements entered into by the Seller with respect to the Business or the Assets with any Governmental Authority currently in effect. No Governmental Authority has instituted, implemented, taken or threatened to take any other action the effect of which, individually or in the aggregate, is reasonably expected to have a Material Adverse Effect on the Assets.

2.1.4 Litigation . Except as set forth on Schedule 2.1.4 to this Agreement, there is no judicial or administrative action, suit, investigation, inquiry, or proceeding pending, or to the Knowledge of Seller, threatened, or any reasonable basis therefor, that questions the validity of this Agreement or of any action taken or to be taken by Seller in connection with this Agreement or the transactions contemplated thereby.

2.1.5. Employee Benefit Plans . The Seller will cease to be the employer whose employees are covered by any employee benefit plan of the Seller or its corporate parent effective as of the Closing. The Smart 401(k) Plan is a qualified plan and has been operated in accordance with the provisions of the Employee Retirement Income Security Act of 1974 in all material respects. To the Knowledge of Seller, there are no actions or omissions which would cause the plan not to be a qualified plan. The Seller has complied in all material respects with all reporting and disclosure requirements with respect to such plan, and to the Knowledge of Seller, there are no material defects in the Smart 401(k) Plan.

 

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2.1.6. Brokers, Finders, etc. All negotiations relating to this Agreement and the transactions contemplated hereby have been carried on without the participation of any Person acting on behalf of Seller in such manner as to give rise to any valid claim against Seller for any brokerage or finder’s commission, fee or similar compensation.

2.2. Representations of Buyer . Buyer represents to Seller as follows:

2.2.1. Authorization; No Conflicts; Status of Buyer, etc .

(a) Due Organization, etc . Buyer is a corporation duly organized, validly existing and in good standing under the laws of its jurisdiction of incorporation, with the requisite corporate power and authority to carry on its business as now conducted and to own or lease and to operate its properties as and in the places where such business is now conducted and such properties are now owned, leased or operated. Buyer is duly qualified to do business and is in good standing as a foreign corporation in all jurisdictions in which the failure to be so qualified, individually or in the aggregate, is reasonably expected to have a Material Adverse Effect on Buyer.

(b) Authorization, etc . Buyer has all requisite corporate power and authority to enter into this Agreement, to perform its obligations hereunder and to consummate the transactions contemplated hereby to be consummated by it. The execution and delivery of this Agreement, and the consummation of the transactions contemplated hereby, by Buyer have been duly authorized by all requisite corporate action of Buyer. This Agreement has been duly executed and delivered by Buyer and constitutes the valid and legally binding obligation of Buyer, enforceable against it in accordance with its terms.

(c) No Conflicts . The execution and delivery of this Agreement by Buyer and the consummation by Buyer of the transactions contemplated hereby will not contravene, result in any violation of, loss of rights or default under, constitute an event creating rights of acceleration, termination, repayment or cancellation under, entitle any party to receive any payment or benefit pursuant to, or result in the creation of any Lien upon any of the properties or assets of Buyer under, (i) any provision of the Organizational Documents of Buyer, (ii) any Applicable Law applicable to Buyer or any of its properties or (iii) any contract of Buyer, except for any such contraventions, violations, losses, defaults, accelerations, terminations, repayments, cancellations or Liens that, individually or in the aggregate, is not reasonably expected to have a Material Adverse Effect on Buyer. No Governmental Approval (other than as may be required pursuant to the Change in Bank Control Act, the Bank Merger Act, the Colorado Revised Statutes, or as may be required by the OCC or FDIC) or other Consent is required to be obtained or made by Buyer in connection with the execution and delivery of this Agreement by Buyer or the consummation by Buyer of the transactions contemplated hereby.

2.2.2. Litigation . Except as set forth on Schedule 2.2.2 to this Agreement, There is no judicial or administrative action, suit, investigation, inquiry or proceeding pending or, to the Knowledge of Buyer, threatened, or any reasonable basis therefor, that questions the validity of this Agreement or of any action taken or to be taken by Buyer in connection with this Agreement or the transactions contemplated thereby.

 

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2.2.3. Compliance with Laws, etc . None of Buyer or its Subsidiaries or Affiliates is in material violation of or material default under, or has at any time since December 31, 2006 materially violated or been in material default under, (i) any Applicable Law applicable to it or any of its properties or business or (ii) any provision of its Organizational Documents. There are no consent decrees or other similar agreements entered into by Buyer or its Subsidiaries or Affiliates with any Governmental Authority currently in effect. No Governmental Authority has instituted, implemented, taken or threatened to take any other action the effect of which, individually or in the aggregate, is reasonably expected to have a Material Adverse Effect on Buyer or its Subsidiaries or Affiliates.

2.2.4. Brokers, Finders, etc. All negotiations relating to this Agreement and the transactions contemplated hereby have been carried on without the participation of any Person acting on behalf of Buyer in such manner as to give rise to any valid claim against Buyer for any brokerage or finder’s commission, fee or similar compensation.

2.2.5. Absence of Certain Facts and Circumstances. As of the date of this Agreement, neither the Buyer nor any Affiliate of the Buyer has any Knowledge of any facts, circumstances or other reason why the Requisite Regulatory Approvals will not be received in a timely manner.

2.3. No Other Representations . Except for the representations expressly contained in this Article II, none of the Seller, the Buyer or any other Person has made or makes any other express or implied representation either written or oral, on behalf of the Seller or the Buyer.

ARTICLE III.

COVENANTS

3.1. Covenants of Seller .

3.1.1. Conduct of Business. From the date hereof to the Closing Date, except as (i) contemplated by or in connection with this Agreement or the transactions contemplated hereby, or (ii) consented to by Buyer (such consent not to be unreasonably withheld or delayed), Seller will:

(a) carry on the Business in the ordinary course consistent with past practices, and use commercially reasonable efforts (to the extent consistent with good business judgment) to preserve intact the present organization of the Business, keep available the services of its executive officers and key employees, and preserve its relationships with customers, clients, suppliers and others having material business dealings with it; provided, however, that Seller may enter into and effectuate agreements for the placement with third-party banks of funds on behalf of Seller’s customers;

(b) not amend its Organizational Documents; provided, however, that Seller may amend its organizational documents to the extent necessary to effectuate the transfer to Buyer of the Marks;

(c) not incur, assume, guarantee (including by way of any agreement to “keep well” or of any similar arrangement) or prepay any Indebtedness or amend the terms relating to any Indebtedness (including, without limitation, capital leases, payments in

 

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respect of the deferred purchase price of property, letters of credit, loan agreements and other agreements relating to the borrowing of money or extension of credit) or issue or sell any debt securities, except for (i) any such incurrence, assumption, guarantee or prepayment of such Indebtedness or amendments of the terms of such Indebtedness in the ordinary course of business consistent with past practices in an aggregate amount not exceeding $2,000,000, (ii) any indebtedness constituting deposits or in connection with checks drawn on financial institutions which constitute a liability separate from deposits but arising out of the deposit obligation, (iii) any such incurrence, assumption, guarantee or prepayment of such Indebtedness or amendments of the terms of such Indebtedness in the ordinary course of business consistent with past practices and the ALCO policy in connection with the management of investment portfolio liquidity, or (iv) any such Indebtedness for the placement with third-party banks of funds on behalf of Seller’s customers;

(d) not sell, transfer, assign, convey, mortgage, pledge or otherwise subject to any Lien any of the Assets, tangible or intangible, except for Permitted Encumbrances or in the ordinary course of business consistent with past practices;

(e) not grant any rights or license under any of its trademarks or trade names or other material registered Intellectual Property owned or licensed by the Company (other than off-the-shelf software programs that have not been customized for use by the Seller) or enter into any licensing or similar agreements or arrangements other than in the ordinary course of business consistent with past practices; provided, however, that Seller may grant such rights as are necessary to effectuate the transfer to Buyer of the Marks;

(f) not sell any assets outside the ordinary course of business consistent with past practices;

(g) not enter into any agreements, contracts or commitments for capital expenditures other than in the ordinary course of business consistent with past practices or that provide for in the case of any single agreement or related agreements, annual payments by Seller with respect to the Business of $3,000,000 or more;

(h) not agree or commit to do any of the foregoing referred to in clauses (a) - (g); and

(i) promptly advise Buyer of any fact, condition, occurrence or change known to Seller that is reasonably expected to have a Material Adverse Effect on the Assets or cause a breach of this Section 3.1.1.

3.1.2. Access and Information From the date hereof to the Closing Date, Seller will give to Buyer and Buyer’s accountants, counsel and other representatives reasonable access during normal business hours to the Seller and the respective offices, properties, books, contracts, commitments, reports and records relating to the Assets, and to furnish them or provide them access to all such documents, financial data, records and information with respect to the Assets as Buyer shall from time to time reasonably request; provided that the foregoing shall be under the general coordination of Seller and shall be subject to the confidentiality provisions set forth in Section 7.5.10.

 

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3.1.3. Governmental Authority Filings . From the date hereof to the Closing Date, Seller will file, or cause to be filed, with the Colorado Division of Banking, the FDIC, the Commission, the OCC, or other relevant Governmental Authority, and promptly thereafter make available to Buyer, copies of each material registration, report, statement, notice or other filing required to be filed by the Seller with the Colorado Divi