Exhibit 10.41
BRANCH PURCHASE AND DEPOSIT ASSUMPTION AGREEMENT
THIS BRANCH PURCHASE AND DEPOSIT ASSUMPTION AGREEMENT (the
"Agreement")
is made and entered into as of this 30th day of
January, 2004 (the
"Agreement
Date"), among the following parties (the
"Parties"):
1)
Matrix Capital Bank, a federal savings bank organized under
the laws of the United States of America (the "Seller"); and
2)
FIRSTBANK, a federal
savings bank organized under the laws of
the United States of America ("FIRSTBANK" or "Purchaser").
W I T N E S S E T H
WHEREAS, Purchaser
desires to
purchase certain of the assets and to
assume certain of the deposit and other
liabilities
of Seller's
branch office
facilities located in Las Cruces, New Mexico and Seller desires to sell such
assets and to have such liabilities
assumed;
NOW THEREFORE, in
consideration of the
mutual promises and conditions
herein set forth, the parties hereto agree
as follows:
Section 1.
Definitions: For the
purpose of this Agreement, the terms
defined in this Section 1 shall have the
meanings assigned to them herein:
"Adjustment Date"
means the fifth
Business Day after the end of the
first full calendar month following the
Closing Date.
"Branch or Branches"
means (as the
context requires) 1) the Branch
Premises, 2) Seller's core banking activities and the assets specifically
described in this Agreement arising from, accounted for on the books of, or
relating most directly to, the Branch Premises as distinguished from the
operation of Seller's other locations (whether or not related
documents are
maintained or accounting entries are made
at the Branch Premises), or 3) both of
the foregoing.
"Branch Premises" means (collectively or individually,
as the context
requires) 1) Seller's full-service banking facilities located at 277
E. Amador
and Annex and 3090 Roadrunner Parkway, Las Cruces, Dona Ana County, New
Mexico
and the lessor's interest in the Leases at the
facilities
more particularly
described in Schedule 6.06, and 2) Seller's
Automated Teller
Machine located in
leased facilities at Picacho Hills Country
Club, 6861 Via Campestra, Las Cruces,
Dona Ana County, New Mexico.
"Business Day" means
any day excluding
Saturday, Sunday and any day
which is a legal holiday under the laws of
the State of New Mexico, or is a day
on which banking institutions located in New Mexico are
authorized or required
by law or other governmental action to
close.
"Deposit" or
"Deposits"
shall have the
meaning set forth in
Section
3(1) of the Federal Deposit Insurance Act,
12 U.S.C. 1813(1), including, without
limitation, and as further defined in Section 3.01, all uncollected items
included in the depositors' balances and credited on the books
of the Seller at
the Determination Date.
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"Determination Date"
means the Seller's
close of business on the last
Business Day preceding the Closing Date. (The daily statement of Seller's
Branches reflecting the amounts of various
assets and
liabilities
as of the
close of business on the Determination Date on a full accrual basis shall
determine with respect to certain items the
exact balance being
transferred to
Purchaser, as more specifically set out
below).
"Equipment" means
those improvements, additions, alterations and
installations constituting all or a part of the
Branch Premises,
on and after
the Agreement Date, including, without
limitation, the automated teller machines
presently in use at or in connection with the Branches, artwork, carpeting,
furniture, shelving, and office supplies (other than office supplies with
Seller's name or trademark), all as more specifically described on Schedule
6.06. As specified in Section 6.06, Schedule 6.06 hereto shall be
delivered by
Seller to Purchaser on or before the 10th
calendar day
following the
Agreement
Date.
"Fixtures" means
those improvements, additions, alterations and
installations constituting all or a part of
the Branch Premises on and after the
Agreement Date, all as more specifically
described on Schedule 6.06.
"Furniture" means
those improvements, additions, alterations and
installations constituting all or a part of
the Branch Premises on and after the
Agreement Date, all as more specifically
described on Schedule 6.06.
"Leases" means the real property leases entered into between Seller
and
the tenants at the Branch Premises
specifically described on Schedule 4.06.
"Loans" means all of
the loans included
in the books and
records of
Seller which were originated by the
Branches.
`Transferred Loan" is defined in Section 2.03.
"Loan Discount" shall have the meaning set forth in Section
2.03.
"Real Estate Properties" means the real estate and improvements
located
in Las Cruces, New Mexico at 277 E. Amador and Annex and 3090 Roadrunner
Parkway, all as more specifically described
in Exhibit A hereto.
"Contracts" have the meaning given them in Section 4.04.
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Section 2. Purchase and Sale of Assets.
2.01 Assets to be Purchased - Purchase Price. Subject to the
terms and conditions provided here, Seller agrees to sell to
Purchaser, and
Purchaser agrees to purchase the Real Estate Properties, the Leases, the
Furniture, the Fixtures, the Equipment, the Contracts, Cash on Hand at the
Branches, and the Transferred Loans
(collectively, the
"Assets") as they exist
on the Closing Date. The total purchase price for the Assets, subject to
adjustment on the Determination Date in accordance with Section
5.03, shall be
as follows ("Purchase Price"):
Assets
Purchase Price
Leases and Furniture,
$ 227,000
Fixtures and Equipment
Transferred Loans
As set forth in Section 2.03.
Cash on Hand
Face amount
Real Estate
As set forth in Section 2.07
Purchase Premium
Determined pursuant
to section 2.02
Contracts
Assumption of the Contracts
as specified in Section 3.05
2.02 Calculation of Purchase Premium. The "Purchase Premium"
shall be determined by multiplying (A) the average of the daily total
Deposits
at the Branches (but, for purposes of determining the Purchase Premium only,
excluding specifically from the definition of Deposits
any brokered
deposits,
municipal, state or public school deposits)
during the twenty (20) calendar day
period immediately preceding the
Determination Date times (B) 6.5% (as stated in
the letter of intent).
2.03 Purchase Price
for Transferred
Loan and Loan
Discount.
The purchase price for each Transferred
Loan (including, for purposes of this
Agreement, the Loan Discount described below, the "Transferred Loan Purchase
Price") shall be (A) 100% of the unpaid principal balance of each such
Transferred Loan on the Determination
Date plus (B) accrued
and unpaid interest
on such Transferred Loan through the
Determination
Date.; provided that, with
respect to each Transferred Loan, Seller
shall provide Purchaser a discount (the
"Loan Discount") equal to (A) .75% multiplied by (B) the unpaid principal
balance of each such Transferred Loan as of
the Determination
Date. In no event
shall the Loan Discount with respect to all
of the Transferred
Loans be greater
than $170,000. The Loan Discount is to cover
prior General Valuation Allowance
(GVA) for future losses established on the
total of the Transferred Loans on the
books of the Seller to meet the
requirements of
Generally Accepted
Accounting
Principles, and general and specific
allowance requirements.
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2.04 Allocation of Purchase Price. The Purchase Price shall be
allocated to the Assets based upon the
schedule set forth above. Purchaser and
Seller shall jointly participate in
preparing Internal Revenue Service Form 8594
("Asset Acquisition Statement under Section 1060") to
be filed by Purchaser to
reflect this allocation.
2.05 Acquisition of
Loans. Purchaser has
had the opportunity
to make an extensive examination of the credit files
containing
documentation
with respect to all of the Loans.
At least ten (10)
Business Days prior to
the
Determination Date, Seller shall provide
Purchaser with a list of all Loans and
Purchaser shall mark on such list all Loans
which Purchaser
desires to exclude
from the purchase on the Closing Date. All
Loans so included in the purchase are
referred to herein as the "Transferred
Loans" and each is
referred to herein as
a "Transferred Loan." Thirty days after the
Closing Date Purchaser may request
Seller to repurchase any Transferred Loan. Seller agrees to make such
repurchase, by wire transfer within two (2)
business days following receipt of
Seller's request. The repurchase price for each such
repurchased
Transferred
Loan shall be equal to the Transferred Loan Purchase Price for the
Transferred
Loan in question.
2.06 Acquisition of Real Estate. At Closing, Purchaser shall
purchase from Seller and Seller shall sell to Purchaser the Real Estate
Properties. The terms upon which such purchase and sale shall occur are set
forth in Exhibit A hereto.
2.07. Real Estate
Purchase Price. The
purchase price for the
Real Estate Properties shall be equal to the assessed value of
the properties as
determined by the Dona Ana County Assessor
for year 2002, plus a
premium of three and
one half percent
(3.5%) of such
assessed value,
which equals an
acquisition
price of:
(1)
$ 2,215,521
------------------
(2)
353,763
------------------
Total
$ 2,569,284
==================
Section 3.
Assumption
of Liabilities; No Assumption of Other
Liabilities.
3.01 Deposit
Liabilities.
Seller
agrees
to assign to
Purchaser, and Purchaser agrees to assume on the Determination Date all
obligations and liabilities of Seller to be
performed, satisfied, and discharged
on and after the Determination Date with respect to Deposits carried on the
books of the Branches and existing at the Determination Date and owed to the
person, corporations and other entities
(including Deposits
held by Individual
Retirement Accounts) named as the respective depositors in the books of the
Branches at the Determination Date, including, without limitation, (a) all
demand deposits, but excluding outstanding cashier's checks, other official
checks of Seller, and (b) all time and savings
deposits, including
accrued and
unpaid interest thereon computed through
the Determination
Date, but
excluding
any brokered certificates of deposits of Seller (the items
included in (a) and
(b) above being collectively, the "Deposits"). The term "Deposits" shall not
include deposit accounts, if any, that, by law or contract,
cannot either be
transferred by Seller or assumed by
Purchaser. Seller also agrees to transfer to
Purchaser all signature cards, deposit contracts, canceled checks and other
records required to be retained
related to the
Deposits in the
possession of
Seller.
3.02 Payment of Checks, Drafts and Orders. Purchaser agrees to
pay all properly payable checks, drafts and
withdrawal orders presented to it by
mail, over its counters, or through
clearing houses by depositors whose accounts
are carried on the books of the
Branches, whether drawn on the check or draft
forms provided by Seller or by Purchaser, to the extent that the assumed
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balances of Deposits to the credit of the
respective makers or
drawers shall be
sufficient to permit the payment thereof, and in all other respects to
discharge, in the usual course of the banking business, the duties and
obligations of Seller with respect to the
balances due and owing with respect to
the Deposits.
3.03 Interest on
Accounts Assumed.
Purchaser agrees to pay
interest on all interest bearing Deposits assumed by it in
accordance with the
terms thereof at the declared rate established by Seller, subject to the
individual contracts relating to such Deposits and
Purchaser's right to change
applicable interest rates as permitted or
required by law.
3.04 Assumption of
Leases. Purchaser
shall assume and
fully
discharge as they become due all
liabilities and
obligations arising
after the
Determination Date under the Leases.
3.05 Assumption of Contracts. Purchaser shall assume and fully
discharge as they become due all
liabilities and
obligations arising
after the
Determination Date under the Contracts.
3.06 No Other Liabilities Assumed. Purchaser shall not assume
any liabilities of Seller, or any kind or description, known or unknown,
disclosed or undisclosed, except for the liabilities described in this
Agreement. Those liabilities and obligations of Seller assumed by Purchaser
under this Agreement are referred to herein as the "Assumed
Obligations"
or
"Assumed Liabilities".
Section 4. Taxes;
Pro-Rations and Reimbursements.
4.01 Sales
Taxes. Purchaser shall pay and remit all sales
taxes or use taxes which, by law, become due and payable by reason of the
consummation of the transaction
contemplated hereby.
4.02 Ad Valorem Taxes. Ad valorem taxes and personal property
taxes accruing or assessed with respect to the Assets for the
calendar year
which includes the Closing Date shall be
pro-rated between
Purchaser and Seller
as of the Closing Date. If the amount of such taxes cannot
be ascertained
at
Closing, such pro-ration shall be done on the basis of taxes assessed for
calendar year 2003.
4.03 Utilities. The
net actual payment
necessary to pro-rate
utility bills (including without limitation monthly
statements for electricity,
natural gas, water, sewer, trash collection and telephone)
shall be made by
Purchaser or Seller, as applicable, on the Adjustment Date, but with the
pro-ration calculated as of the Closing
Date.
4.04
Contracts.
All equipment, maintenance, supplies and
material, and service agreements relating to the Branches
("Contracts")
are
listed on Schedule 6.07. Seller shall assign to
Purchaser,
as of the Closing
Date, any of Seller's rights under the
Contracts.
4.05 Leases. All payments under Leases shall be prorated as of
Closing Date.
4.06 Rental Income.
Seller will assign all
building leases
relating to the Real Estate Properties to Purchaser. All tenant deposits
covering such items as first and last
months rentals plus
any damage
deposits
held in escrow will be assigned to the
Purchaser. Schedule of
tenant leases are
detailed in Schedule 4.06.
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4.07 Safe Deposit
Boxes. Box income will be prorated to
Purchaser based on the Determination
Date.
4.08 Employees.
(a) On the Closing Date, Purchaser shall offer
employment at the Branches to all employees
of Seller
employed at the Branches at base wages and
salaries no less
favorable than the
wages and salaries currently being paid by Seller to such
employees.
To the
extent consistent with Purchaser's
existing structure for
comparable
positions
and comparable officer titles and its
current policies regarding officer titles,
such employees shall be offered positions with responsibilities and officer
titles comparable to those they currently
have with Seller. All
such employees
accepting employment with Purchaser are hereafter called the "Continuing
Employees". Purchaser shall cause all Continuing Employees to have the same
benefits provided by Purchaser generally to employees of
Purchaser.
Continuing
Employees will be provided with credit for time served with respect to
Purchaser's employee Profit Sharing and Employee Stock Ownership Plan. In
addition, Purchaser shall permit each
Continuing Employee
the option to obtain
past service credit for accrued vacation as of the Determination Date or to
accept payment from the Seller for such accrued vacation leave as of the
Determination Date (in which case, no past
service credit shall
be provided by
Purchaser to the Continuing Employee). In the event that a Continuing
Employee
chooses to accept from Purchaser past service credit for his or her accrued
vacation as of the Determination Date, then Seller shall pay to Purchaser
the
amount, plus applicable payroll taxes, that
otherwise would have been payable to
such Continuing Employee had he or she chose to be paid for such accrued
vacation.
(b) Seller agrees that
it shall render to
Purchaser
commercially reasonable assistance in soliciting
employees of the
Branches to
accept employment with Purchaser, including but not limited to permitting
Purchaser to immediately contact and solicit such employees. Purchaser
acknowledges that Seller has made no
assurances
to Purchaser
with respect to
such employees' accepting positions with Purchaser and
incurs no liability to
Purchaser in rendering the assistance
referred to herein.
(c) Purchaser
shall have no liability to any of
Seller's current employees for any accrued wages,
sick leave,
vacation time,
pension obligations or any other employee benefits. Purchaser will have no
liability and will not assume obligations under any "employee benefit plan",
through the Closing Date (as such term is defined in
the Employee
Retirement
Security Act of 1974, as amended) of Seller
or any other obligations (including,
without limitation, severance obligations) of Seller to the employees of
the
Branches. Seller will be responsible for
fulfilling, and
resolving any disputes
concerning its liabilities or obligations (including, without limitation,
severance obligations) to the employees at
the Branches under any such employee
benefit plan or otherwise. All wages and salaries, workers' compensation
payments, vacation pay and social security
and unemployment taxes
of employees
of the Branches shall be paid by Seller
for the period to and
including the
Determination Date. Seller affirms that there
are no employment
contracts with
any Continuing Employees in effect at
Closing Date.
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Section 5. Closing.
5.01 Date of Closing. The closing of the transactions
contemplated hereby (the "Closing")
shall take place at a
mutually agreed time
and place on a Business Day within 30 days following the satisfaction (or
waiver, when appropriate) of all conditions, including the receipt of all
required regulatory approvals for the
transactions provided
for herein, and the
expiration of any statutory waiting periods applicable thereto. The date of
Closing is referred to herein as the
"Closing Date".
The effective time of
the
Closing for the purpose of final
calculation of balances of Assets transferred,
liabilities assumed, and Deposits and accrued
interest thereon shall
be as of
Seller's normal close of business on the
Determination
Date. Purchaser shall
take possession of the Branch Premises and shall open branch offices at the
Branch Premises effective at the normal closing of
business on the Closing Date
notwithstanding the fact that the Closing may not
be concluded until later that
day. Provided that the Closing is in
fact consummated on
the Closing Date, all
banking transactions occurring (deposits,
withdrawals, receipt of loan payments,
accrual of interest, etc.) with respect to any Assets purchased or Deposits
assumed shall be treated (as between
Purchaser and Seller) as having occurred
subsequently to the Closing and shall become part of the operations of the
Purchaser.
5.02 Actions of Parties at Closing.
(a) At Closing, Seller Shall:
(1) Execute
and deliver to Purchaser in
recordable form an assignment of the Leases
together with any required consents
and any assignments reasonably necessary in order to evidence the sale to
Purchaser, without recourse, of the Transferred Loans and any collateral
relating thereto;
(2) Execute and
deliver to Purchaser
such
bills of sale, endorsements, assignments and other instruments of transfer as
reasonably required in order to evidence
ownership of the
Assets in Purchaser,
together with any required consents;
(3) Deliver
to Purchaser, all files,
documents, papers, agreements and other records pertaining to the Assets
transferred and the Assumed
Liabilities;
(4) Deliver the
Cash on Hand to Purchaser;
(5) Deliver
physical possession of the
Branch Premises to Purchaser, including
delivery of keys, security codes, etc;
(6) Pay to Purchaser
by wire transfer in
same day funds a sum of money equal to the amount of the Deposits assumed by
Purchaser pursuant to Section 3 (including interest accrued through the
Determination Date) and execute, acknowledge and deliver to Purchaser all
certificates and other documents required to be delivered to
Purchaser at the
Closing pursuant to the terms of this
Agreement.
(b) At the
Closing, Purchaser shall:
(1)
Pay to Seller the Purchase Price;
(2) Execute,
acknowledge
and deliver to
Seller such instruments and documents as reasonably required to evidence
Purchaser's assumption of the Assumed
Liabilities
(3) Execute,
acknowledge
and deliver to
Seller all certificates and other documents required to be delivered to
Seller
at the Closing pursuant to the terms of
this Agreement.
5.03 Adjustment
Date: The payments which are required to
be
made on the Closing Date shall be
made pursuant to a
preliminary
settlement
statement agreed to by the
parties, substantially
in the form of Schedule 2.0
hereto. On the Adjustment Date,
Seller and Purchaser
shall make an adjusting
settlement between each other as of the Determination Date with regard to
pro-rations and other adjustments provided in this Agreement and
with regard
to any errors, omissions or miscalculations with regard to amounts paid by
either party on the Closing Date or subsequently; notwithstanding the
foregoing, Purchaser and Seller
shall make settlement with each other as often
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as each Business Day, if
necessary, in order to
reimburse the other party for
cashier's checks or customer checks presented to and paid by one party but
required to be paid by the other
party pursuant to this Agreement.
Section 6.
Representations and
Warranties of Seller.
Seller
represents and warrants to Purchaser as
follows:
6.01 Organization of Seller. Seller is a federal savings
bank
duly organized, validly existing under the
laws of the United States and has all
requisite corporate power and authority and
possesses all governmental and other
permits, licenses, approvals and other authorizations to own or lease its
properties and to carry on its business as now being conducted. Seller is an
insured bank as defined in the Federal
Deposit Insurance Act and applicable
regulations thereunder.
6.02 Authority;
Binding Effect. Seller has full right and
authority to enter into this Agreement and subject to receipt
of any applicable
regulatory approvals, to perform its obligations
hereunder.
The execution and
delivery of this Agreement and the
consummation of the transactions contemplated
hereby have been duly and validly
authorized by the Board of Directors of Seller
and no other corporate acts or proceedings on the part of
Seller are necessary
to authorize this Agreement or the
transaction
contemplated
hereby; and this
Agreement constitutes the valid and legally binding obligation of Seller
enforceable against Seller in accordance with its terms. The execution and
delivery of this Agreement, the consummation of the
transactions
contemplated
hereby and the compliance by Seller with
any of the provisions
hereof will not
conflict with, result in a breach of, or entitle
any party to terminate or call
a default with respect to any contract or
instrument to which the Seller and the
Assets or liabilities assumed hereunder are
subject.
6.03 Financial Records. All books and records of the
Branches
have been (and will be as of the Closing
Date) kept in accordance with generally
accepted accounting principles and in accordance
with all applicable record
retention periods under federal or state law in all
material respects and
the
financial records of the Seller as of
November 30, 2003
present fairly in
all
material respects the financial position of the Branches and are complete,
current, and accurate in all material
regards as of the date(s) so stated.
6.04 Liability and
Obligations.
At the Agreement
Date, the
Branches had no obligation or liability,
whether accrued,
absolute,
contingent
or otherwise, which was material to the financial condition, business or
obligations of the Branches or which when
combined with all similar obligations
or liabilities, would have been material,
which has not been
reflected in the
Branches' financial records, or in the schedules referred to
herein, nor does
there exist a set of circumstances resulting from transactions effected or
events occurring with respect to the
Assets on or prior to the Agreement Date,
or from any action omitted to be taken during such period which, to the
knowledge of Seller, could reasonably be
expected to result in any such material
obligation or liability, except as disclosed in the
financial records or in the
schedules referred to herein.
6.05 Evidence of
Indebtedness. Each
note or other instrument
evidencing a Transferred Loan and any
related security
agreement or instruments
(including without limitation a guaranty or similar
instrument) is (A) to
the
knowledge of Seller, a legal, valid and binding obligation of
the obligor named
therein, enforceable against such obligor
in accordance with its terms (subject,
as to enforcement of remedies, to applicable bankruptcy, insolvency,
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reorganization, moratorium and similar laws from time to time
in effect), (B)
has not been participated out to another
lender, and (C) all
actions necessary
to perfect any related security interest have been taken or will be taken
by
Seller in a timely manner. To the best knowledge of Seller,
no Transferred Loan
is subject to any defense, offset or counterclaim and each Transferred Loan
complies with all applicable laws and regulations known to Seller. To the
knowledge of Seller there are no valid claims for offset or other defense
(including, but not limited to usury) by
any such obligor based on any action or
omission of Seller.
6.06 Physical
Properties. Schedule
6.06, to be delivered
by
Seller to Purchaser within ten (10) calendar days following the execution of
this Agreement, provides an itemized list of all
items of Furniture,
Fixtures,
Equipment, and other Assets owned by Seller and located at the
Branches as of
the Agreement Date, except those items, if any, of Furniture, Fixtures and
Equipment listed in Schedule 6.06 which are not being
acquired by
Purchaser.
Seller owns each such item free and clear of all liens, pledges, security
interests, charges, burdens, encumbrances, options and adverse claims. The
operation of the property and business of Seller at
the Branches in the manner
in which they were previously operated or are now operated does not, to the
knowledge of Seller, violate any existing
or proposed environmental laws, zoning
ordinances, building codes or municipal
regulations in such a
way as could, if
such laws, ordinances or regulations were enforced, result in any material
impairment of the use of the Branches for the purpose for which they are now
operated. Seller is aware of no existing or contemplated condemnation
proceedings affecting or relating to the
Branch premises and Seller has paid or
will pay in full all bills and invoices for
labor and materials arising from the
ownership and operation of the Branch
premises and such Branch premises shall be
in good operating condition and free of all
liens and claims.
6.07. Agreements, Contracts and Commitments. Schedule 6.07 to
this Agreement lists specifically all
Contracts to which Seller is a party or by
which Seller or any of the Assets is in any way affected or bound. All such
Contracts are legally valid and binding and in full force and effect, and
neither Seller nor, to the knowledge of Seller, any other party is in default
thereunder. None of the rights of Seller
thereunder
will be impaired by the
consummation of the transactions
contemplated hereby.
6.08.
Taxes.
(a) There are no tax liabilities of Seller that could
become payable by Purchaser as a result
of the fact that
Purchaser will be the
transferee of the Assets (except only ad
valorem taxes, personal property taxes,
real estate taxes, which are not yet due and payable, and which are to be
prorated pursuant to Section 4.
(b) With respect to all interest bearing accounts
assigned to Purchaser, the records of
Seller transferred to Purchaser contain or
will contain all information and documents (including without limitation
properly completed Forms W-9) necessary to
comply in all material respects with
all information reporting and tax withholding
requirements
under federal and
state laws, rules and regulations, and such records identify with
specificity
all accounts subject to backup withholding
under the Internal Revenue Code.
(c) All federal, state, and local payroll,
withholding, property, sales, use and transfer
taxes, if any, which are due and
payable by Seller relating to the operation of the Branches on or
prior to the
Closing Date shall be paid in full or Seller shall have made appropriate
provision for such payment in accordance
with ordinary business practices.
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6.09 Compliance with
Laws. Seller is not in
violation of any
law, statute, rule, governmental regulation or order, or court decree or
judgment which violation would reasonably
be expected to have a material adverse
effect on the Assets, the liabilities to be
assumed under this Agreement, or the
business and operations of the
Branches.
6.10 Litigation or Other Proceedings. There is no suit, action
or legal, administrative, arbitration or other proceedings or governmental
investigation pending or threatened,
which would reasonably
be expected to have
a material adverse financial effect on Seller, the Assets, the liabilities
assumed or the business and operations of
the Branches.
6.11 Inchoate Claims. Seller has no notice or knowledge of any
agreement, claim or controversy, relating to Seller either directly or
indirectly, which would reasonably be expected to result in a suit,
action,
proceeding or other formal procedure
against Seller relating to the Assets, the
liabilities assumed, or the business and operations of the Branches, nor
knowledge of any circumstances which might give rise to such claim or
controversy other than actions taken by Seller in the normal
course of banking
business.
6.12 Broker's or Finder's Fee. There is no valid claim against
Seller by any broker or other third party for any finder's fee, brokerage
commission or other similar payment related to the transactions contemplated
hereby.
6.13 Insurance.
Seller has in full
force and effect policies
of insurance and fidelity bonds of type and
in amounts that are customary in the
banking industry for an institution of
comparable size and Seller will continue
all of such insurance and bonds in full force and effect and will give all
notices and present all claims thereunder in due and timely fashion up and to
the Closing Date.
6.14 Accident
and Claims.
There have been no
accidents or
similar events relating to the Branches
which have resulted,
or may result, in
claims against Seller which are not either fully
covered by insurance,
or by
reserves, or other provisions created, or
made, for such claims.
6.15 Employment
Agreements. Seller is
not a party to (i) any
written employment agreement, (ii) any oral or written
management
agreement
relating to the Real Estate Properties,
or (iii) any oral
employment
agreement
with personnel of the Branches
which cannot be
terminated
at the election of
Seller on not more than thirty (30) days
notice.
6.16 Hazardous
Substances.
The Branches and the use and
operation of the Branches are in
compliance
with all federal,
state or local
laws, ordinances or regulations
relating to industrial
hygiene and to the best
knowledge of the Seller the environmental conditions on, under or about the
Branches including without limitation air, soil, surface
water and groundwater
conditions are in material compliance with all federal, state or local laws,
ordinances or regulations relating to environmental conditions. To the best
knowledge of Seller, there are no
environmental, health or safety conditions on,
under or about the Branches, including
without limitation the air, soil, surface
water and groundwater that would materially interfere with the conduct of
the
business of the Branches or materially adversely affect the Branches, the
Assets, or the assumed liabilities. To the best of the knowledge of Seller,
neither Seller nor any third party,
including,
without limitation, Seller's
predecessors in title to the Branches,
have used or installed
any underground
tanks or gas or oil wells, or used,
generated,
manufactured, treated,
stored,
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placed, deposited, discharged, released or disposed of on, under
or about the
Branches or transported to or from the Branches any
Hazardous Substances
(as
defined below). To the best knowledge of the Seller,
the Branches have
never
been used as a dump or landfill site, there
are no asbestos-containing materials
in the Branches or incorporated into the
improvements in violation of applicable
laws, there are and have been no
polychlorinated
biphenyl ("PCB")-containing
electrical transformer fluorescent light fixture with ballasts or other PCB
Item, as defined at 40 C.F.R. Section 761.3 or any
PCB-containing fluid
on the
Branches, or to the best knowledge of the Seller are there or have
there ever
been any investigations, notices or violations, requests for information or
claims of any kind asserted or threatened to be asserted by any person,
including any federal, state or local governmental agency relating to the
storage, disposal, discharge or release of any Hazardous Substances. For
purposes of this Agreement, "Hazardous Substances" shall mean any flammable,
explosive, radioactive material, hazardous waste, toxic substance or related
material and any other substance or material defined or designated as a
hazardous or toxic substance, material or waste by any federal,
state or local
law or environmental statute, regulation or ordinance
presently in effect
and
shall include, without limitation, (i) those substances included within the
definition of "hazardous substances",
"hazardous materials",
toxic substances",
"solid waste" in the Comprehensive
Environmental
Response, Compensation, and
Liability Act of 1980, as amended, 42
U.S.C. Sections 9601, et seq. the Resource
Conservation and Recovery Act of 1976,
42 U.S.C. Sections 6901 et seq., the
Toxic Substances Control Act, 15 U.S.C.
Sections 2601 et seq., and the Hazardous
Materials Transportation Act, 49 U.S.C Sections 1801 et seq., and in the
regulations promulgated pursuant to said laws; (ii) those
substances listed in
the United States Department of Transportation Table (49 D.F.R. 172.101 and
amendments thereto) or by the Environmental
Protection Agency (or
any successor
agency) as hazardous substances (40 C.F.R. Part 302 and amendments thereto);
(iii) such other substances, materials and wastes which are regulated under
applicable local, state or federal law, or the
Unites States
government,
or
which are classified as hazardous or toxic
under federal, state or local laws or
regulations; (iv) any material, waste or substance which is or contains (i)
petroleum, (ii) asbestos or (iii) PCB, or which is
designated as a
"hazardous
substance" pursuant to Section 311 of the Clear Water Act, 33 U.S.C Sections
1251 et seq. (33 U.S.C. ss.1321) or listed pursuant to
Section 307 of the Clean
Water Act (33 U.S.C. ss.1317), provided, however, that the term shall not
include those substances that are of a character and quantity that are
reasonably associated with the use of the Real Estate Properties as bank
branches.
6.17 Deposits.
Attached hereto as Schedule 6.17 is a true and
accurate schedule of all Deposits
(excluding brokered CDs, but including IRA's),
and related information, which are domiciled at the
Branches, prepared as
of a
date within 10 calendar days of the Agreement Date (which Schedule shall be
updated at and as of the Determination
Date and, as updated,
shall be true and
accurate as of such date). The Deposits are insured by the
Savings
Association
Insurance Fund of the Federal Deposit Insurance Corporation to the fullest
extent permitted by federal law. To the best knowledge of the Seller, the
Deposits were solicited and currently
exist in material
compliance
with all
applicable requirements of federal, state and local laws and regulations
promulgated thereunder (for purposes of this clause,
Deposit would not be
in
material compliance if the non-compliance
subjects the depository institution to
any penalty or liability). The Deposits (i)
are in all material respects genuine
and enforceable obligations of Seller,
except to the extent
enforcement may be
limited by applicable bankruptcy, insolvency, reorganization or other
similar
laws affecting creditor's rights generally and by
general principles of
equity
and (ii) were acquired in the ordinary
course of Seller.
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6.18
Tenant Leases.
(a) The Leases are valid and binding
obligations of Seller, enforceable against Seller in accordance with their
terms, subject as to enforcement to bankruptcy, insolvency, reorganization,
moratorium, laws governing fraudulent conveyance or equitable
subordination
principles and other laws of general
applicability
relating to or affecting
creditors' rights generally and to general
pri
