Date of Report (Date of earliest event reported)
|
July 14, 2011
|
Hampton Roads Bankshares, Inc.
|
||
(Exact name of registrant as specified in its charter)
|
||
Virginia
|
001-32968
|
54-2053718
|
(State or other jurisdiction
|
(Commission
|
(IRS Employer
|
of incorporation)
|
File Number)
|
Identification No.)
|
999 Waterside Drive, Suite 200, Norfolk, Virginia 23510
|
||
(Address of principal executive offices) (Zip Code)
|
(d) Exhibits
|
||
Ex. 10.1
|
Purchase & Assumption Agreement, dated July 14, 2011, by and between The Bank of Hampton Roads and The East Carolina Bank.
|
|
Ex. 99.1
|
Press Release, dated July 14, 2011, announcing agreement to sell seven North Carolina branches to ECB Bancorp.
|
Hampton Roads Bankshares, Inc.
|
|||
Date: July 14, 2011
|
By:
|
/s/ Douglas J. Glenn
|
|
Douglas J. Glenn
|
|||
Executive Vice President, General
Counsel and Chief Operating Officer
|
Exhibit No.
|
Description
|
|
Ex. 10.1
|
Purchase & Assumption Agreement, dated July 14, 2011, by and between The Bank of Hampton Roads and The East Carolina Bank.
|
|
Ex. 99.1
|
Press Release, dated July 14, 2011, announcing agreement to sell seven North Carolina branches to ECB Bancorp.
|
ARTICLE I TRANSFER OF ASSETS AND LIABILITIES
|
1
|
||
Section 1.1. Transferred Assets
|
1
|
||
Section 1.2. Purchase Price
|
3
|
||
Section 1.3. Deposit Liabilities
|
4
|
||
Section 1.4. [Removed]
|
8
|
||
Section 1.5. Safe Deposit Business
|
8
|
||
Section 1.6. Employee Matters
|
8
|
||
Section 1.7. Records and Data Processing
|
9
|
||
Section 1.8. Security
|
10
|
||
Section 1.9. Taxes and Fees; Proration of Certain Expenses
|
10
|
||
Section 1.10. Real Property
|
10
|
||
|
ARTICLE II CLOSING AND EFFECTIVE TIME
|
16
|
|
Section 2.1. Effective Time
|
16
|
||
Section 2.2. Closing
|
16
|
||
Section 2.3. Post-Closing Adjustments
|
19
|
||
ARTICLE III INDEMNIFICATION
|
20
|
||
Section 3.1. Seller's Indemnification of Purchaser
|
20
|
||
Section 3.2. Purchaser's Indemnification of Seller
|
20
|
||
Section 3.3. Claims for Indemnity
|
20
|
||
Section 3.4. Limitations on Indemnification
|
21
|
||
Section 3.5. Exclusive Remedy
|
21
|
||
|
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF SELLER
|
22
|
|
Section 4.1. Corporate Organization
|
22
|
||
Section 4.2. No Violation
|
22
|
||
Section 4.3. Corporate Authority
|
22
|
||
Section 4.4. Enforceable Agreement
|
22
|
||
Section 4.5. No Brokers
|
23
|
||
Section 4.6. Title to and Condition of Property.
|
23
|
||
Section 4.7. Limitation on Representation on Condition of Property
|
23
|
||
Section 4.8. [Removed]
|
23
|
||
Section 4.9. Compliance with Certain Laws
|
24
|
||
Section 4.10. Community Reinvestment Act Representation
|
24
|
||
Section 4.11. Leases
|
24
|
||
Section 4.12. Limitation of Representations and Warranties
|
24
|
||
Section 4.13. Seller’s Knowledge.
|
24
|
||
Section 4.14.Litigation.
|
24
|
||
Section 4.15.Consents and Approvals.
|
25
|
||
Section 4.16.Deposit Liabilities.
|
25
|
||
Section 4.17.Deposit Insurance.
|
25
|
||
Section 4.18.Government Proceedings.
|
25
|
||
Section 4.19.Environmental Matters.
|
26
|
||
Section 4.20.Employee Matters.
|
26
|
||
|
ARTICLE V REPRESENTATIONS AND WARRANTIES OF PURCHASER
|
26
|
|
Section 5.1. Corporate Organization
|
26
|
||
Section 5.2. No Violation
|
26
|
||
Section 5.3. Corporate Authority
|
27
|
||
Section 5.4. Enforceable Agreement
|
27
|
||
Section 5.5. No Brokers
|
27
|
||
ARTICLE VI OBLIGATIONS OF PARTIES PRIOR TO AND AFTER EFFECTIVE TIME
|
27
|
||
Section 6.1. Access to Information
|
27
|
||
Section 6.2. Delivery of Magnetic Media Records
|
28
|
||
Section 6.3. Application for Approval to Effect Purchase of Assets and
Assumption of Liabilities
|
28
|
||
Section 6.4. Conduct of Business; Maintenance of Properties
|
29
|
||
Section 6.5. No Solicitation by Seller
|
30
|
||
Section 6.6. Further Actions
|
31
|
||
Section 6.7. Fees and Expenses
|
31
|
||
Section 6.8. Breaches with Third Parties
|
31
|
||
Section 6.9. Insurance
|
31
|
||
Section 6.10. Public Announcements
|
31
|
||
Section 6.11. Tax Reporting
|
32
|
||
Section 6.12.Regulatory Approvals and Consents.
|
32
|
||
Section 6.13.Signs.
|
32
|
||
Section 6.14.Forms.
|
32
|
||
Section 6.15.Customers’ New Check and Draft Forms.
|
32
|
||
Section 6.16.Holds and Stop Payments.
|
33
|
||
Section 6.17.Deposit Histories.
|
33
|
||
Section 6.18.ATM and Debit Cards.
|
33
|
||
Section 6.19.Backup Withholding.
|
33
|
||
Section 6.20.Electronic Installation.
|
34
|
||
Section 6.21.Actions With Respect to IRA and Keogh Plan Deposit Liabilities.
|
34
|
||
Section 6.22.Closing of Roper Banking Center.
|
35
|
||
Section 6.23.New Lease Agreements.
|
35
|
||
Section 6.24.Amendment of Agreement.
|
35
|
||
ARTICLE VII CONDITIONS TO PURCHASER'S OBLIGATIONS
|
36
|
||
Section 7.1. Representations and Warranties True
|
36
|
||
Section 7.2. Obligations Performed
|
36
|
||
Section 7.3. No Adverse Litigation
|
36
|
||
Section 7.4. Regulatory Approval
|
36
|
||
|
ARTICLE VIII CONDITIONS TO SELLER'S OBLIGATIONS
|
37
|
|
Section 8.1. Representations and Warranties True
|
37
|
||
Section 8.2. Obligations Performed
|
37
|
||
Section 8.3. No Adverse Litigation
|
37
|
||
Section 8.4. Regulatory Approval
|
37
|
||
Section 8.5. Release from Real Property Leases.
|
37
|
||
ARTICLE IX TERMINATION
|
38
|
||
Section 9.1. Methods of Termination
|
38
|
||
Section 9.2. Procedure Upon Termination
|
39
|
||
Section 9.3. Payment of Expenses
|
39
|
||
ARTICLE X MISCELLANEOUS PROVISIONS
|
39
|
||
Section 10.1. Amendment and Modification
|
39
|
||
Section 10.2. Waiver or Extension
|
40
|
||
Section 10.3. Assignment
|
40
|
||
Section 10.4. Confidentiality
|
40
|
||
Section 10.5. Time of Essence.
|
40
|
||
Section 10.6. Addresses for Notices, Etc.
|
40
|
||
Section 10.7. Counterparts
|
40
|
||
Section 10.8. Headings.
|
41
|
||
Section 10.9. Governing Law.
|
41
|
||
Section 10.9. Sole Agreement
|
42
|
||
Section 10.11. Severability.
|
42
|
||
Section 10.12. Parties In Interest.
|
42
|
||
Section 10.13.Survival.
|
42
|
|
(a)
|
As of the Effective Time (as defined in Section 2.1) and upon the terms and conditions set forth herein, Seller will sell, assign, transfer, convey and deliver to Purchaser, and Purchaser will purchase from Seller, all of the transferable rights, title and interests of Seller in the following assets associated with the Banking Centers and identified in this Agreement and the Schedules and Exhibits hereto, and not otherwise excluded pursuant to the provisions of Subsection 1.1(b):
|
|
(1)
|
fee simple title to all real estate and improvements thereon at those Banking Centers described as Preston Corners and Plymouth on Schedule 1.1(a)(1) (the “Improved Real Property”);
|
|
(2)
|
fee simple title to all unimproved real estate described as Chapel Hill Land, Brier Creek Land and Wakefield Land on Schedule 1.1(a)(2) (the “Unimproved Real Property”);
|
|
(3)
|
Seller’s rights as tenant in and to the real property leases as described on Schedule 1.1(a)(3) (the “Real Property Leases”) for undeveloped land in Durham, North Carolina and the improved land in Chapel Hill, North
|
|
Carolina, as more particularly described in such leases (the “Leased Real Property”);
|
|
(4)
|
except as provided in Section 1.1(b), the furniture, fixtures, leasehold improvements, equipment and other tangible personal property owned by Seller and located at the Banking Centers and used in conducting Seller’s business at the Banking Centers (the "Personal Property") as listed on Schedule 1.1(a)(4), together with any manufacturer’s warranties and maintenance or service agreements thereon that are in effect on the Closing Date and are assignable to Purchaser;
|
|
(5)
|
all equipment leases for equipment located at the Banking Centers (the "Equipment Leases"), and all assignable operating contracts of the Banking Centers excluding any master contracts (the "Assignable Contracts"); Equipment Leases and Assignable Contracts are listed on Schedule 1.1(a)(5);
|
|
(6)
|
all safe deposit contracts and leases for the safe deposit boxes located at the Banking Centers as of the Effective Time (the "Safe Deposit Contracts");
|
|
(7)
|
all coins and currency located at the Banking Centers as of the Effective Time (the "Coins and Currency"); and
|
|
(8)
|
all merchant services accounts associated with Deposit Liabilities (as defined in Section 1.3(a)) located at the Banking Centers.
|
|
(b)
|
Excluded from the assets, properties and rights being transferred, conveyed and assigned to Purchaser under this Agreement are the assets listed on Schedule 1.1(b) hereto, Seller's rights in and to the names “Bank of Hampton Roads,” “The Bank of Hampton Roads,” “Gateway Bank,” “Bank of Hampton Roads Service Corporation,” “Gateway Bank Mortgage, Inc.,” “Gateway Investment Services, Inc.,” “Gateway Insurance Services, Inc.,” “Gateway Title Agency, Inc.,” “GBTC, Inc.,” “GBTC-VA, Inc.,” “BHR” and any of Seller's corporate logos, trademarks, trade names, signs, paper stock, forms and other supplies containing any such logos, trademarks or trade names, and trade names and logos of third parties with whom Seller has contracted to provide services to its customers (the "Excluded Assets"). Seller shall coordinate with Purchaser to remove the Excluded Assets from the Banking Centers on or prior to the Effective Time. Seller shall remove the Excluded Assets at its own cost, and, apart from making any reasonable
|
|
(a)
|
As consideration for the purchase of the Banking Centers, Purchaser shall pay Seller a purchase price (the "Purchase Price") equal to the sum of the following:
|
|
(1)
|
With respect to the Owned Real Property, $8,750,000 (the "Property Value").
|
|
(2)
|
A premium for the Deposit Liabilities (as defined in Section 1.3(a)) and franchise value related to the Banking Centers listed on Schedule 1.2(a)(2) as follows:
|
|
(i)
|
7.5% for interest-bearing demand deposit accounts contained in the Deposit Liabilities;
|
|
(ii)
|
3.0% for money market demand deposit accounts contained in the Deposit Liabilities;
|
|
(iii)
|
10.0% for non-interest-bearing demand deposit accounts contained in the Deposit Liabilities;
|
|
(iv)
|
4.0% for savings accounts contained in the Deposit Liabilities;
|
|
(v)
|
1.0% for the certificates of deposit contained in the Deposit Liabilities; and
|
|
(vi)
|
2.0% for individual retirement accounts contained in the Deposit Liabilities;
|
|
(3)
|
The book value (net of accumulated depreciation) of the Personal Property as shown on the books and records of Seller on the last day of the quarter immediately preceding the Closing Date;
|
|
(4)
|
The face amount of the Coins and Currency; and
|
|
(5)
|
$100,000; provided that the Banking Center located at 102 W. Buncombe Street, Roper, North Carolina (the “Roper Banking Center”) is closed in accordance with Section 6.22 of this Agreement.
|
|
(b)
|
(1)
|
In addition, Purchaser shall assume, as of the Effective Time (as defined in Section 2.1), all of the duties, obligations and liabilities of Seller arising on or after the Effective Time relating to the Real Property, the Real Property Leases, the Equipment Leases, the Assignable Contracts, the Safe Deposit Contracts, the Deposit Liabilities (including all accrued interest relating thereto) and the ownership and operation of the Banking Centers (except for the Wilmington and Roper Banking Centers as described on Schedule 1.1(b)) in the ordinary course of business, including without limitation, the payment of salary, compensation and benefits to the New Employees (as defined in Section 1.6); provided, that any cash items paid by Seller and not cleared prior to the Effective Time shall be the responsibility of Seller, subject to the terms of Section 1.3.
|
|
(2)
|
All liabilities and obligations of Seller not expressly included in Section 1.2(b)(1) are excluded from the transactions contemplated in this Agreement, including without limitation: all liabilities associated with cashier’s checks or other official bank checks and traveler’s checks issued by Seller before the Closing Date; all liabilities and obligations of Seller relative to Employees (as defined in Section 1.6) with respect to periods before the Closing Date; and all liabilities and obligations of Seller relating to the Banking Centers that are not expressly included in Section 1.2(b)(1).
|
|
(c)
|
Seller shall prepare a balance sheet (the "Pre-Closing Balance Sheet") in accordance with generally accepted accounting principles consistently applied as of a date not earlier than 30 calendar days prior to the Effective Time anticipated by the parties (the "Pre-Closing Balance Sheet Date") reflecting the assets to be sold and assigned hereunder and the liabilities to be transferred and assumed hereunder. Seller agrees to pay to Purchaser at the Closing (as defined in Section 2.1), in immediately available funds, the excess amount, if any, of the amount of Deposit Liabilities assumed by Purchaser pursuant to Subsection (b) above, as reflected by the Pre-Closing Balance Sheet, over the Purchase Price computed in accordance with Subsection (a) above, as reflected by the Pre-Closing Balance Sheet. The amount paid at Closing shall be subject to subsequent adjustment based on the Post-Closing Balance Sheet (as defined in Section 2.3).
|
|
(a)
|
"Deposit Liabilities" shall mean all of Seller's duties, obligations and liabilities relating to the deposit accounts (except as set forth in Section 1.3(b)) located at the Banking Centers as of the Effective Time (including accrued but unpaid or uncredited interest thereon). A projected list of the Deposit Liabilities is attached hereto as Schedule 1.3(a), which shall be updated as soon as practicable after Closing.
|
|
(1)
|
Seller's official checks, cashier checks, letters of credit, money orders, interest checks and expense checks issued prior to closing, consignments of U.S. Government "E" and "EE" bonds and any and all traveler's checks.
|
|
(2)
|
Liabilities or obligations of Seller with respect to any litigation, suits, claims, demands or governmental proceedings arising, commenced or made known to Seller prior to Closing or arising from events occurring prior to Closing.
|
|
(3)
|
Deposit accounts associated with lines of credit.
|
|
(4)
|
Deposit accounts associated with qualified retirement plans where Seller is the trustee of such plan or the sponsor of a prototype plan used by such plan.
|
|
(5)
|
Deposit accounts associated with Seller's national or regional account relationships, if any.
|
|
(6)
|
Self-directed individual retirement accounts, if any, it being understood that all other types of IRA Deposit Liabilities are intended to be transferred; provided Seller has not received, on or before the Closing Date, the account holder’s objection or failure to accept Purchaser as successor custodian.
|
|
(7)
|
Deposits that have been reported as abandoned property under the abandoned property laws of any jurisdiction.
|
|
(8)
|
Brokered deposits as defined by 12 CFR §337.6(a)(2).
|
|
(9)
|
Deposit accounts that have been overdrawn for more than 30 days as of the Closing Date.
|
|
(c)
|
Seller does not represent or warrant that any deposit customers whose accounts are assumed by Purchaser will become or continue to be customers of Purchaser after the Effective Time.
|
|
(d)
|
Purchaser agrees to pay in accordance with law and customary banking practices all properly drawn and presented checks, drafts and withdrawal orders presented to Purchaser by mail, over-the-counter or through the check clearing system of the banking industry, by depositors of the accounts assumed, whether drawn on the checks, withdrawal or draft forms provided by Purchaser or for a period not to exceed sixty (60) calendar days after the Closing Date, on the checks, withdrawal
|
|
(e)
|
If, after the Effective Time, any depositor, instead of accepting the obligation of Purchaser to pay the Deposit Liabilities assumed, shall demand payment from Seller for all or any part of any such assumed Deposit Liabilities, Seller shall not be liable or responsible for making any such payment.
|
|
(f)
|
Purchaser agrees, at its cost and expense, (1) to assign new account numbers to depositors of assumed accounts, (2) to notify such depositors, on or before the Effective Time, in a form and on a date mutually acceptable to Seller and Purchaser, of Purchaser's assumption of Deposit Liabilities, and (3) to furnish such depositors with checks on the forms of Purchaser and with instructions to utilize Purchaser's checks and to destroy unused check, draft and withdrawal order forms of Seller and that checks or drafts drawn more than sixty (60) calendar days after the Closing Date on Seller’s check or draft forms will not be honored. In connection with this obligation, Seller shall provide Purchaser with a customer list on the Deposit Liabilities together with information regarding these customers’ accounts. (If Purchaser so elects, Purchaser may offer to buy from such depositors their unused Seller check, draft and withdrawal order forms.) In addition, Seller will notify its affected customers by letter of the pending assignment of the Deposit Liabilities to Purchaser, which notice shall be at Seller's cost and expense and shall be in a form and mailed at a time mutually agreeable to Seller and Purchaser.
|
|
(g)
|
Purchaser agrees to pay promptly to Seller an amount equivalent to the amount of any checks, drafts or withdrawal orders credited to an assumed account as of the Effective Time that are properly returned to Seller after the Effective Time.
|
|
(h)
|
As of the Effective Time, Purchaser will assume and discharge Seller's duties and obligations in accordance with the terms and conditions and laws, rules and regulations that apply to the certificates, accounts and other Deposit Liabilities assumed under this Agreement.
|
|
(i)
|
As of and after the Effective Time, Purchaser will maintain and safeguard in accordance with applicable law and sound banking practices all account documents, deposit contracts, signature cards, deposit slips, canceled items and other records related to the Deposit Liabilities assumed under this Agreement, subject to Seller's right of access to such records as provided in this Agreement.
|
|
(j)
|
Within thirty (30) calendar days after the Closing Date, Seller will render a final statement to each depositor of an account assumed under this Agreement as to transactions occurring through the Effective Time; provided, however, that Seller shall not be obligated to render a final statement on any account not ordinarily
|
|
receiving periodic statements in the ordinary course of Seller's business. Seller will be entitled to impose normal fees and service charges on a per-item basis at Closing, but Seller will not impose periodic fees or blanket charges in connection with such final statements.
|
|
(k)
|
Within sixty (60) calendar days after the Closing Date, Seller will timely provide to Purchaser 1099 data for Purchaser to comply with all laws, rules and regulations regarding 2011 tax reporting of transactions of such accounts through the Effective Time.
|
|
(l)
|
Seller will provide Purchaser, at least twenty (20) calendar days before the Closing, the list of ACH entries for electronic transfer accounts maintained at the Banking Centers. As of the Effective Time, Purchaser, at its expense, will notify all Automated Clearing House ("ACH") originators of the transfers and assumptions made pursuant to the Agreement; provided, however, that Seller may, at its option, notify all such originators itself (on behalf of Purchaser) also at the expense of Purchaser. For a period of 60 calendar days beginning on the Effective Time, Seller will honor all ACH items related to accounts assumed under this Agreement which are routed or presented to Seller. Seller will make no charge to Purchaser for honoring such items, and will electronically transmit such ACH data to Purchaser. If Purchaser cannot receive an electronic transmission, Seller will make available to Purchaser at Seller's operations center receiving items from the Automated Clearing House tapes containing such ACH data. Items routed or presented after the 60-day period shall be returned to the presenting party. Seller and Purchaser shall make arrangements to provide for the daily settlement with immediately available funds by Purchaser of any ACH items honored by Seller, and Seller shall be held harmless and indemnified by Purchaser for acting in accordance with this arrangement to accept ACH items.
|
|
(m)
|
As of the Effective Time, Purchaser agrees to use commercially reasonable efforts to collect from Purchaser's customers amounts equal to any Visa or MasterCard charge backs under the MasterCard and Visa Merchant Agreements between Seller and its customers, or amounts equal to any deposit items returned to Seller after the Effective Time which were honored by Seller prior to the Effective Time, and remit such amounts so collected to Seller. Purchaser agrees to immediately freeze and remit to Seller any funds, up to the amount of the charged back or returned item that had been previously credited by Seller, if such funds are available at the time of notification by Seller to Purchaser of the charged back or returned item and such charge back is permitted. Notwithstanding the foregoing, Purchaser shall have no duty to remit funds for any item or charge that has been improperly returned or charged to Seller. Solely for the purposes of this Section 1.3(m), all references to Seller shall be deemed to include Seller and its assignees.
|
|
(a)
|
As of the Effective Time, Purchaser will assume and discharge Seller's obligations with respect to the safe deposit box business at the Banking Centers arising on or after the Effective Time in accordance with the terms and conditions of contracts or rental agreements related to such business, and Purchaser will maintain all facilities necessary for the use of such safe deposit boxes by persons entitled to use them; provided, that nothing herein shall be deemed to prohibit Purchaser, after the Effective Time, from discontinuing the safe deposit box services or facilities at the Banking Centers (all in accordance with applicable law and any contractual obligations regarding the same).
|
|
(b)
|
As of the Effective Time, Seller shall transfer and assign the records related to such safe deposit box business to Purchaser, and Purchaser shall maintain and safeguard all such records and be responsible for granting access to and protecting the contents of safe deposit boxes at the Banking Centers.
|
|
(c)
|
Safe deposit box rental payments (not including late payment fees) collected by either Seller or Purchaser applying to periods both before and after the Effective Time shall be prorated as of the Effective Time.
|
|
(a)
|
Purchaser shall offer employment to all employees employed by Seller at the Banking Centers as of the Effective Time (the "Employees”) that are set forth in Schedule 1.6, in their then respective current functional positions and locations, with remuneration not less than levels at the Effective Time and benefits generally equivalent to benefits offered by Purchaser to similarly situated employees of Purchaser. Employees who become employees of Purchaser as of the Effective Time ("New Employees") and their dependents, if any, covered under Seller's health insurance plan before the Effective Time shall be covered under Purchaser's health insurance plan without being subject to any pre-existing condition limitations or exclusions. New Employees shall not be required to satisfy the deductible and employee payments required by Purchaser's comprehensive medical and/or dental plans for the calendar year of the Effective Time (i) to the extent of amounts previously credited during such calendar year under comparable plans maintained by Seller, or (ii) to the extent the same are waived in their entirety by the applicable insurer, as determined by the applicable insurer in its sole discretion. With respect to Purchaser's qualified and nonqualified pension plans, New Employees will not receive credit for prior service with Seller (or with other entities to the extent service with any such entity is treated by Seller as service with it). Benefits under Purchaser's pension plans for New Employees shall be determined solely with reference to service with Purchaser.
|
|
(b)
|
Seller makes no representations or warranties about whether any of its employees will remain at the Banking Centers and become and remain employed by Purchaser after the Effective Time. Seller will use its commercially reasonable efforts to maintain the employees as employees of Seller at the Banking Centers until the Effective Time. Purchaser shall have no responsibilities or rights with respect to any employee of Seller whose employment shall be terminated for any reason prior to the Effective Time or who shall elect not to become an employee of Purchaser. Seller agrees that, for a period of 36 months after the Effective Time, it will not solicit for employment any New Employee who remains employed by Purchaser; provided, however, that such prohibition shall not apply to solicitations which are directed to the general public.
|
|
(c)
|
[Removed]
|
|
(d)
|
Seller shall be responsible for the filing of Forms W-2 with the Internal Revenue Service and any required filing with state tax authorities with respect to wages and benefits paid to each such Employee for periods ending on or prior to the close of business on the Closing Date.
|
|
(e)
|
Purchaser shall not assume any accrued paid time off, vacation or sick days, severance benefits, or other benefits owed to any Employee by Seller as of (and including) the Closing Date. Seller shall pay the New Employees any such benefits to which they are entitled through the close of business on the Closing Date, except for any accrued, but unused, sick days. The length of a New Employee’s vacation benefits will be determined solely with reference to the New Employee’s service with Purchaser.
|
|
(f)
|
Prior to the Closing Date, Seller shall afford the officers and authorized representatives of Purchaser access to the Employees for interviews and training purposes, at Purchaser’s sole expense, at reasonable times without interfering with the Banking Centers’ normal business and operations.
|
|
(a)
|
As of the Effective Time, Purchaser shall become responsible for maintaining the files, documents and records referred to in this Agreement. Purchaser will preserve and safekeep them as required by applicable law and sound banking practice. After the Effective Time, Purchaser will permit Seller and its representatives, at reasonable times and upon reasonable notice, to examine, inspect, copy and reproduce (at Seller's expense) any such files, documents or records as Seller deems necessary.
|
|
(b)
|
As of the Effective Time, Seller will permit Purchaser and its representatives, at reasonable times and upon reasonable notice, to examine, inspect, copy and
|
|
reproduce (at Purchaser's expense) files, documents or records retained by Seller regarding the assets and liabilities transferred under this Agreement as Purchaser deems necessary.
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(c)
|
It is understood that certain of Seller's records may be available only in the form of photocopies, film copies or other non-original and non-paper media.
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(a)
|
Title and Leasehold Matters.
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|
(i)
|
Seller will convey good and marketable title to the Owned Real Property to Purchaser, subject to Title Defects accepted by Purchaser as described below.
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(ii)
|
Purchaser agrees to notify Seller in writing within sixty (60) calendar days after the date of this agreement (the “Inspection Period”) of any mortgages,
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pledges, material liens, encumbrances, reservations, tenancies, encroachments, overlaps or other title exceptions or zoning or similar land use violations (excluding legal but nonconforming uses) related to the Owned Real Property to which Purchaser reasonably objects (the "Title Defects"). Within the Inspection Period the Purchaser may, at Purchaser’s expense, obtain a Commitment for an ALTA Owner’s Form B Title Insurance Policy (the “Title Policy”) issued by a title insurer reasonably approved by Seller (the “Title Insurer”), with respect to the Owned Real Property and designating Purchaser as the proposed insured (the “Title Commitment”). Purchaser agrees that Title Defects shall not include real property taxes not yet due and payable, or easements, restrictions, tenancies, and rights of way which do not materially interfere with the use of the Owned Real Property as a banking center or defects which Purchaser can obtain protection from through purchase of title insurance at regular rates (or higher rates if the excess over the regular rate is paid by Seller). Seller shall have no obligation to cure any Title Defects. If Seller is unable or unwilling to cure any such Title Defects to Purchaser's reasonable satisfaction, Purchaser shall have the option (upon written notice to Seller) to either (x) accept the Title Defects and receive title in its then existing condition and proceed to Closing (without a Purchase Price adjustment), or (y) terminate this Agreement solely with respect to the affected Owned Real Property and purchase only the Deposit Liabilities related to the associated Banking Center, unless: (i) the Purchaser elects not to purchase the Improved Real Property at the Plymouth Banking Center as described on Schedule 1.1(a)(1), in which case Purchaser may not purchase the Deposit Liabilities associated with either the Roper or Plymouth Banking Centers; or (ii) the Purchaser elects not to purchase the Improved Real Property at the Preston Corners Banking Center as described on Schedule 1.1(a)(1), in which case Purchaser may not purchase Deposit Liabilities associated with the Lake Boone and Falls of Neuse Banking Centers.
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(iii)
|
Within the Inspection Period, the Purchaser may, at the Purchaser’s expense, obtain a survey of the Owned Real Property.
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(iv)
|
Purchaser shall have the right to update title matters at Closing for any changes that may have arisen between the date of Purchaser's original title search and the Closing Date. If such update indicates that any Title Defects have been placed of record since the effective date of the Title Commitment and Purchaser reasonably objects thereto, then Purchaser agrees to notify Seller in writing within three (3) business days of receiving notification thereof. Seller shall have no obligation to cure any Title Defects. If Seller is unable or unwilling to cure any such Title Defects to Purchaser's reasonable satisfaction, Purchaser shall have the option (upon written notice to Seller) to either (x) accept the Title Defects and receive title in its then existing condition and proceed to Closing (without a
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Purchase Price adjustment), or (y) terminate this Agreement solely with respect to the affected Owned Real Property and purchase the Deposit Liabilities related to the associated Banking Center and the other Banking Centers, unless: (i) the Purchaser elects not to purchase the Improved Real Property at the Plymouth Banking Center as described on Schedule 1.1(a)(1), in which case Purchaser may not purchase the Deposit Liabilities associated with either the Roper or Plymouth Banking Centers; or (ii) the Purchaser elects not to purchase the Improved Real Property at the Preston Corners Banking Center as described on Schedule 1.1(a)(1), Purchaser may not purchase Deposit Liabilities associated with the Lake Boone and Falls of Neuse Banking Centers.
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(v)
|
Purchaser accepts the terms of each of the Real Property Leases as is. If any such Leases is not assignable without the consent of the landlord, and if the landlord does not consent to assignment of such Lease as is, Purchaser agrees to use reasonable efforts to reach agreement with the landlord with respect to such Lease and agrees to notify Seller in writing no later than thirty (30) days before the Closing. If satisfactory arrangements have not been made as of such time wherein landlord consents to such assignment, this Agreement shall be terminated solely with respect to the affected Leased Real Property.
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(b)
|
Environmental Matters.
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|
(c)
|
Facilities Inspection.
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|
(i)
|
Purchaser shall have the right, at Purchaser’s expense, to inspect the physical condition of the Owned Real Property (collectively, “Building Issues”) during the Inspection Period. These inspections shall be conducted during regular business hours by qualified inspectors or employees of Purchaser or its affiliates following not less than three (3) business days notice to Seller, and a representative of Seller is entitled to be present at any inspection. Prior to entry upon the Owned Real Property, Purchaser will confirm to Seller the existence of general liability insurance in coverage amounts reasonably acceptable to Seller. Any physical disturbance to the Owned Real Property shall be subject to Seller’s prior approval, which may be subject to such reasonable repair and restoration conditions as Seller may impose (including, without limitation, the obligation to repair any disturbed area to its condition immediately prior to that disturbance). Purchaser promptly shall provide Seller with copies of any and all written reports in connection with those inspections, at no cost to Seller, upon Seller’s request.
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(ii)
|
Purchaser shall return the Owned Real Property to the condition existing prior to any tests and inspections performed by Purchaser or Purchaser’s representatives, as determined by Seller in its reasonable discretion. Purchaser shall indemnify, hold harmless and, if requested by Seller (in Seller’s sole discretion), defend (with counsel approved by Seller) Seller, together with Seller’s affiliates, parent and subsidiary entities, successors, assigns, partners, managers, employees, officers, directors, shareholders, counsel, representatives, agents, from and against any and all damages,
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(d)
|
Correction of Defects.
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|
If Purchaser discovers a material defect in a Banking Center with respect to Building Issues or discovers an Environmental Issue (each a “Defect”), Purchaser shall notify Seller in writing within the Inspection Period. Seller shall have no obligation to cure any Defect. If Seller is unable or unwilling to cure any Defects to Purchaser’s reasonable satisfaction, Purchaser shall have the option (upon written notice to Seller) to either (x) accept the Defect and receive the Owned Real Property in its then existing condition and proceed to Closing (without a Purchase Price adjustment), or (y) terminate this Agreement solely with respect to the affected Owned Real Property and purchase the Deposit Liabilities related to the associated Banking Center and the other Banking Centers, unless: (i) the Purchaser elects not to purchase the Improved Real Property at the Plymouth Banking Center as described on Schedule 1.1(a)(1), in which case Purchaser may not purchase the Deposit Liabilities associated with either the Roper or Plymouth Banking Centers; or (ii) the Purchaser elects not to purchase the Improved Real Property at the Preston Corners Banking Center as described on Schedule 1.1(a)(1), in which case Purchaser may not purchase Deposit Liabilities associated with the Lake Boone and Falls of Neuse Banking Centers.
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(e)
|
Casualty and Condemnation.
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Except as stated in this Agreement, Seller shall bear all risk of loss or damage to the Owned Real Property from all causes until the Closing; provided, however, Seller shall have no obligation to repair such loss or damage.
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(ii)
|
If before Closing: (a) any material portion of any Owned Real Property is destroyed by fire, the elements or by any other casualty (a “Casualty”), or (b) any material portion of any Owned Real Property is taken by eminent domain or made the subject of condemnation proceedings (a “Taking”), Seller shall give Purchaser prompt written notice thereof and Purchaser may elect, by written notice to Seller within ten (10) business days after Purchaser has received written notice of such event from Seller (and the Closing shall be extended for two (2) business days after the expiration of such termination election period, if applicable), to terminate this Agreement without further liability, solely with respect to the affected
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(iii)
|
If this Agreement is not terminated pursuant to Section 1.10(e)(ii), then at the Closing the following shall occur:
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(A)
|
Seller shall credit on account of the Purchase Price the amount, as applicable, of all condemnation awards actually received by Seller or any sums of money collected by Seller (whether retained by Seller or paid directly to a holder of any lien on the Owned Real Property) under its policies of insurance or renewals thereof insuring against the loss in question to the extent same have not been expended for the purpose of restoration or repair of the Owned Real Property.
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(B)
|
In the case of a Taking, Seller shall assign, transfer and set over to Purchaser all of Seller's right, title and interest in and to (a) such further sums payable thereunder, and (b) any awards that may be made with respect to any pending or future condemnation proceeding.
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(C)
|
In the case of a Casualty, Seller shall assign, transfer and set over to Purchaser all of Seller's right, title, and interest in and to the proceeds of any casualty insurance policies payable to Seller.
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(D)
|
In the case of a Casualty, Seller shall credit against the Purchase Price the amount of any deductible under its insurance policy, but not to exceed the amount required to repair or replace the portion of the Owned Real Property damaged or destroyed.
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(E)
|
All provisions of this Subparagraph (e) shall also be applicable to: (i) any Leased Real Property subject, however, to the rights of the
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(f)
|
Development Bonds.
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|
If Seller has outstanding bonds, letters of credit, or other security issued in favor of a municipality or agency related to the development of any Unimproved Real Property (the “Seller Bonds”) Purchaser shall cause to be issued to such municipality or agency, effective at Closing, any replacement bonds or letters of credit that are necessary to obtain the release of the Seller Bonds.
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(a)
|
All actions taken and documents delivered at the Closing shall be deemed to have been taken and executed simultaneously, and no action shall be deemed taken nor any document delivered until all have been taken and delivered.
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(b)
|
At the Closing, subject to all the terms and conditions of this Agreement, Seller shall deliver or make reasonably available to Purchaser:
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|
(1)
|
Special warranty deeds transferring title to the Owned Real Property to Purchaser;
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(2)
|
A Bill of Sale, in substantially the form attached hereto as Exhibit 2.2(b)(2) (the "Bill of Sale"), transferring to Purchaser all of Seller's interest in the Personal Property and other assets and other instruments of title as Purchaser may reasonably request to vest in Purchaser good and marketable title thereto, free and clear of all encumbrances;
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(3)
|
An Assignment and Assumption Agreement, in substantially the form attached hereto as Exhibit 2.2(b)(3) (the "Assignment and Assumption Agreement"), assigning Seller's interest in the Equipment Leases, the Assignable Contracts, the Real Property Leases (such lease assignments
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(4)
|
Consents from third persons that are required to effect the assignments set forth in the Assignment and Assumption Agreement, including, but not limited to, the lessors under the Equipment Leases and the Real Property Leases to the extent required, and subject to Section 1.10(a)(v) with respect to the Real Property Leases. With respect to any Equipment Lease for which the required consent is not obtained from the lessor prior to the Closing, in lieu of such consent Seller may provide either (at Seller’s sole option), a special indemnity in form and content reasonably satisfactory to Purchaser against any loss to Purchaser resulting from the failure to obtain such consent, or the substitution by Seller and delivery hereunder to Purchaser of equipment comparable to the equipment subject to such Equipment Lease;
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(5)
|
Seller's keys to the safe deposit boxes and Seller's records related to the safe deposit box business at the Banking Centers;
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(6)
|
[Removed]
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(7)
|
Seller's records related to the Deposit Liabilities assumed by Purchaser;
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(8)
|
Immediately available funds in the net amount shown as owing to Purchaser by Seller on the Closing Statement, if any;
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(9)
|
The Coins and Currency;
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|
(10)
|
Such of the other assets to be purchased as shall be capable of physical delivery;
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(11)
|
A certificate of a proper officer of Seller, dated as of the Closing Date, certifying the fulfillment of all conditions that are the obligation of Seller and that all of the representations and warranties of Seller set forth in this Agreement remain true and correct in all material respects as of the Effective Time;
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(12)
|
A certified copy of a resolution of the Board of Directors of Seller, or its Executive Committee, approving the sale of the Banking Centers contemplated hereby;
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(13)
|
Such certificates and other documents as Purchaser and its counsel may reasonably require to evidence the receipt by Seller of all necessary
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|
(14)
|
A Closing Statement, substantially in the form attached hereto as Exhibit 2.2(b)(14) (the "Closing Statement");
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|
(15)
|
An affidavit of Seller certifying that Seller is not a "foreign person" as defined in the federal Foreign Investment in Real Property Tax Act of 1980;
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|
(16)
|
The Power of Attorney substantially in the form attached hereto as Exhibit 1.4(k);
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(17)
|
An instrument that shall assign and transfer IRAs attributable to the Banking Centers and assumed hereunder to Purchaser and that shall appoint Purchaser as a successor or trustee for such accounts; and
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|
(18)
|
Such executed customary affidavits and documents as Purchaser’s title insurer may require as a condition to issuing owner’s title insurance policies to Purchaser with respect to the Real Property.
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|
It is understood that the items listed in Subsections (b)(5) and (9) shall be transferred after the Banking Centers have closed for business on the Closing Date and that the records listed in Subsection (b)(7) will be transferred as soon as practicable after the Closing, but in no event more than five (5) business days after the Closing. For purposes of this Agreement, the term "business day" shall mean any day that Seller is open for business and that is not a Saturday, Sunday or federal holiday.
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|
(c)
|
At the Closing, subject to all the terms and conditions of this Agreement, Purchaser shall deliver to Seller:
|
|
(1)
|
The Assignment and Assumption Agreement;
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|
(2)
|
A certificate and receipt acknowledging the delivery and receipt of possession of the property and records referred to in this Agreement;
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|
(3)
|
Immediately available funds in the net amount shown as owing to Seller by Purchaser on the Closing Statement, if any;
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|
(4)
|
A certificate of a proper officer of Purchaser, dated as of the Closing Date, certifying to the fulfillment of all conditions that are the obligation of Purchaser and that all of the representations and warranties of Purchaser set forth in this Agreement remain true and correct in all material respects as of the Effective Time;
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|
(5)
|
A certified copy of a resolution of the Board of Directors, or its Executive Committee, of Purchaser approving the purchase of the Banking Centers contemplated hereby;
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|
(6)
|
Such certificates and other documents as Seller and its counsel may reasonably require to evidence the receipt by Purchaser of all necessary corporate and regulatory authorizations and approvals for the consummation of the transactions provided for in this Agreement; and
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|
(7)
|
The Closing Statement.
|
|
(d)
|
All instruments, agreements and certificates described in this Section 2.2 shall be in form and substance reasonably satisfactory to the parties' respective legal counsel.
|
|
(a)
|
Not later than 30 business days after the Effective Time, Seller shall deliver to Purchaser a balance sheet dated as of the Effective Time and prepared in accordance with generally accepted accounting principles consistently applied reflecting the assets sold and assigned and the liabilities transferred and assumed hereunder (the "Post-Closing Balance Sheet"). Seller shall afford Purchaser and its accountants and attorneys the opportunity to review all work papers and documentation used by Seller in preparing the Post-Closing Balance Sheet. Within 15 business days following delivery of the Post-Closing Balance Sheet (the "Adjustment Payment Date"), Seller and Purchaser shall effect the transfer of any funds as may be necessary to reflect changes in such assets and liabilities between the Pre-Closing Balance Sheet and the Post-Closing Balance Sheet together with interest thereon computed from the Effective Time to the Adjustment Payment Date at the applicable Federal Funds Rate (as hereinafter defined).
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|
(b)
|
In the event that a dispute arises as to the appropriate amounts to be paid to either party on the Adjustment Payment Date, each party shall pay to the other on such Adjustment Payment Date all amounts other than those as to which a dispute exists. Any disputed amounts retained by a party which are later found to be due to the other party shall be paid to such other party promptly upon resolution with interest thereon from the Adjustment Payment Date to the date paid at the applicable Federal Funds Rate. In the event of an unresolved dispute, either party may submit the matter to a firm of certified public accountants mutually agreeable to Seller and Purchaser (the “Mediator”), which shall determine such dispute in accordance with the terms and conditions of this Agreement within 30 calendar days after the submission. The parties shall each pay one-half of the fees and expenses of the Mediator, except that the Mediator may assess the full amount of
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|
its fees and expenses against either party if it determines that party negotiated the Post-Closing Balance Sheet in bad faith. The Post-Closing Balance Sheet, as agreed upon by the parties and determined under this Subsection, shall be final and binding upon the parties.
|
|
(c)
|
The Federal Funds Rate shall mean the rate quoted for Federal Funds in the Money Rates Column of the Wall Street Journal, adjusted daily, for the period beginning with the first calendar day following the Effective Time and ending with the Adjustment Payment Date.
|
|
(a)
|
A claim for indemnity under Sections 3.1 or 3.2 of this Agreement shall be made by the claiming party prior to the expiration of twelve (12) months the Effective Time by the giving of notice thereof to the other party. Such notice shall set forth in reasonable detail the basis upon which such claim for indemnity is made. In the event that any such claim is made within such prescribed twelve (12) month period, the indemnity relating to such claim shall survive until such claim is
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|
resolved. Claims not made within such twelve (12) month period shall cease and no indemnity shall be made therefor.
|
|
(b)
|
In the event that any person or entity not a party to this Agreement shall make any demand or claim or file or threaten to file any lawsuit, which demand, claim or lawsuit may result in any liability, damage or loss to one party hereto of the kind for which such party is entitled to indemnification pursuant to Section 3.1 or 3.2, then, after notice is provided by the indemnified party to the indemnifying party of such demand, claim or lawsuit, the indemnifying party shall have the option, at its cost and expense, to retain counsel for the indemnified party to defend any such demand, claim or lawsuit. In the event that the indemnifying party shall fail to respond within ten (10) business days after receipt of such notice of any such demand, claim or lawsuit, then the indemnified party shall retain counsel and conduct the defense of such demand, claim or lawsuit as it may in its discretion deem proper, at the cost and expense of the indemnifying party. In effecting any settlement of any such demand, claim or lawsuit, an indemnified party shall act in good faith, shall consult with the indemnifying party and shall enter into only such settlement as the indemnifying party shall approve (the indemnifying party's approval will be implied if it does not respond within ten (10) business days of its receipt of the notice of such settlement offer).
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|
(a)
|
Seller has not entered into any agreement regarding the Real Property and/or the Banking Centers listed on Schedule 6.23 other than (i) those specifically set forth herein or disclosed to Purchaser prior to the execution of this Agreement, (ii) those listed on Schedule 4.6(a), (iii) those that are recorded in the chain of title to the Real Property, and (iv) the Real Property Leases, the Equipment Leases, and the Assignable Contracts.
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|
(b)
|
To Seller’s knowledge, the Real Property and/or the Banking Centers listed on Schedule 6.23 are not subject to any condemnation proceeding, other proceeding or litigation of any kind, pending or threatened, which would be binding upon Purchaser and would materially affect or limit Purchaser's use and enjoyment of the Real Property and/or the Banking Centers listed on Schedule 6.23.
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|
(c)
|
To Seller’s knowledge, the Personal Property is in good operating condition and repair, giving consideration to its age and use and subject to ordinary wear and tear, Seller has good and marketable title to the assets to be transferred under this Agreement, and the Banking Centers are in conformity in all material respects with all zoning ordinances, building or fire codes or other laws, statutes, ordinances, codes or regulations applicable to them and all certificates, licenses and permits required for the lawful use and occupancy of such property have been obtained and are in full force and effect.
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|
(i)
|
Carry on, or cause to be carried on, the business of the Banking Centers substantially in the same manner as on the date hereof, use all reasonable efforts to preserve intact its current business organization, including its relationship with the personnel at the Banking Centers, and preserve its business relationships with depositors, customers and others having business relationships with it and whose accounts will be retained at the Banking Centers; provided, that Seller need not, in its sole discretion, advertise or promote new or substantially new customer services in the principal market areas of the Banking Centers;
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|
(ii)
|
Cooperate with and assist Purchaser in assuring the orderly transition of the business of the Banking Centers to Purchaser from Seller; and
|
|
(iii)
|
Maintain the Real Property, the Personal Property and the Banking Centers listed on Schedule 6.23 in its current condition, ordinary wear and tear, casualty and condemnation excepted.
|
|
(b)
|
Between the date hereof and the Effective Time, Seller shall not, without the prior consent of Purchaser:
|
|
(i)
|
Acquire or dispose of any fixed assets with respect to the Banking Centers, other than pursuant to commitments made on or before the date of this Agreement and except for replacement of furniture, furnishings and equipment and normal maintenance and refurbishing in the ordinary course of business of the Banking Centers, provided that this Section shall not require the replacement of any such items by Seller and provided, further that any expenditure greater than $25,000 shall require the prior written approval of the Purchaser;
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|
(ii)
|
Increase or agree to increase the salary, remuneration or compensation or other employment benefits of the Employees other than in accordance with Seller’s customary policies or bank-wide changes consistent with past practices, or pay or agree to pay any uncommitted bonus to any such Employees other than regular bonuses granted based on historical practice;
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|
(iii)
|
Change any pricing in deposit accounts at the Banking Centers on other than a regional basis, except as may be required in the ordinary course of business consistent with past practices;
|
|
(iv)
|
Increase the staffing levels at any Banking Center or effect changes in branch personnel employed as of the Effective Time other than in the
|
|
(v)
|
Enter into any agreement to sell, grant or convey the Real Property and/or the Banking Centers listed on Schedule 6.23 or any part thereof, including easements or rights of way over the Real Property and/or the Banking Centers listed on Schedule 6.23;
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|
(vi)
|
transfer to Seller’s other branches any Assets;
|
|
(vii)
|
transfer to Seller’s other branches any Deposit Liabilities except upon the unsolicited request of a depositor in the ordinary course of business;
|
|
(viii)
|
transfer, assign, encumber or otherwise dispose of or enter into any contract, agreement or understanding, or negotiate with any party with respect to entering into a contract, agreement or understanding, to transfer, assign, encumber or otherwise dispose of any or all of the Assets or Deposit Liabilities except in the ordinary course of business or pursuant to this Agreement;
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|
(ix)
|
enter into any new contract, commitment, lease or other transaction relating to the Banking Centers that requires aggregate future payments in excess of $25,000, except in the ordinary course of business; or
|
|
(x)
|
enter into any employment, agency or other contract or arrangement for the performance of personal services at the Banking Center, which is not terminable within thirty (30) days without liability to Purchaser.
|
|
(a)
|
For a period of 36 months after the Effective Time, Seller will not specifically target and solicit customers of the Banking Centers utilizing any customer or mailing list which contains names and addresses of customers of the Banking Centers; provided, that these restrictions shall not apply to general mass mailings, telemarketing calls, statement stuffers and other similar communications directed to all or to specified categories of customers of Seller or Seller's affiliates at the time the contact lists for such communications are prepared (which shall be following the Closing), or to the public or newspaper, radio or television advertisements of a general nature, or otherwise prevent Seller from taking such actions as may be required to comply with any applicable federal or state laws, rules or regulations. In addition, these restrictions shall not apply to (a) the solicitation of (i) commercial accounts normally established and maintained in offices other than the Banking Centers or (ii) any credit or debit card customer which has an agreement with Seller for merchant services which is not transferred
|
|
(b)
|
For a period of 36 months commencing as of the Closing Date, neither Seller nor any affiliate shall offer or engage in commercial banking services within the Raleigh Metropolitan Statistical Area.
|
|
(a)
|
Any Withholding Obligations required to be remitted to a governmental agency on or prior to the Closing Time will be withheld and remitted by Seller prior to the Closing Date.
|
|
(b)
|
Any Withholding Obligations with respect to interest payments posted on or before the Closing Time, which are not required to be remitted to a government agency until after the Closing Time, shall be remitted by Purchaser. At the Closing, Seller will remit to Purchaser all sums withheld by Seller pursuant to Withholding Obligations which funds are or may be required to be remitted to a governmental agency on or after the Closing Time.
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|
(c)
|
Any Withholding Obligations with respect to interest payments posted after the Closing Time will be remitted by Purchaser. Purchaser shall also remit to the appropriate governmental agency, on or after the Closing Time, all sums previously remitted by Seller to Purchaser pursuant to the second sentence of paragraph (b) hereof.
|
|
(d)
|
Any penalties described on “B” notices from the IRS or any similar penalties that relate to Deposit Liabilities accruing prior to the Closing Time will be paid by Seller promptly upon receipt of the notice, provided such penalty assessment resulted from Seller’s acts, policies or omissions.
|
|
(a)
|
reasonable advance notice of such entry shall be given to Seller, such entry shall comply with Seller’s security procedures and Seller shall have the right to have its employees or contractors present to inspect the work being done;
|
|
(b)
|
all such work shall be done so as to cause the minimum practicable interference with Seller’s business in the Banking Centers; and
|
|
(c)
|
all such work will be done in compliance with applicable laws and governmental regulations, and Purchaser shall be responsible for the procurement, at Purchaser’s expense, of all required governmental or administrative permits and approvals.
|
|
(a)
|
Purchaser shall have received all necessary regulatory approvals of the transactions provided in this Agreement, all notice and waiting periods required by law to pass shall have passed, no proceeding to enjoin, restrain, prohibit or invalidate such transactions shall have been instituted or threatened, and any conditions of any regulatory approval shall have been met.
|
|
(b)
|
Such approvals shall not have imposed any condition which is materially disadvantageous or burdensome to Purchaser in its sole discretion.
|
|
Section 7.5. Execution of the New Real Property Leases
|
ARTICLE VIII
|
CONDITIONS TO SELLER'S OBLIGATIONS
|
|
(a)
|
Purchaser shall have received from the appropriate regulatory authorities approval of the transactions contemplated herein, waiting periods required by law to pass shall have passed, no proceeding to enjoin, restrain, prohibit or invalidate such transactions shall have been instituted or threatened, and any conditions of any regulatory approval shall have been met.
|
|
(b)
|
Seller shall have received all necessary regulatory approval of the New Real Property Leases. Such approval shall not have imposed any condition which is materially disadvantageous or burdensome to Seller in its sole discretion.
|
|
Section 8.5. Release from the Real Property Leases.
|
|
This Agreement may be terminated in any of the following ways:
|
|
(a)
|
by either Purchaser or Seller, in writing five calendar days in advance of such termination, if the Closing has not occurred by December 31, 2011, unless such date is extended in writing by mutual agreement of the parties;
|
|
(b)
|
at any time on or prior to the Effective Time by the mutual consent in writing of Purchaser and Seller;
|
|
(c)
|
by Purchaser in writing if the conditions set forth in Article VII (with the exception of delivery of items required to be delivered at Closing) of this Agreement shall not have been met by Seller or waived in writing by Purchaser within 30 calendar days following the date of all approvals by regulatory agencies and after all statutory waiting periods have expired;
|
|
(d)
|
by Seller in writing if the conditions set forth in Article VIII of this Agreement shall not have been met by Purchaser or waived in writing by Seller within 30 calendar days following the date of all approvals by regulatory agencies and after all statutory waiting periods have expired;
|
|
(e)
|
any time prior to the Effective Time, by Purchaser or Seller in writing if the other shall have been in breach of any representation and warranty in any material respect (as if such representation and warranty had been made on and as of the date hereof and on the date of the notice of breach referred to below), or in breach of any covenant, undertaking or obligation contained herein, and such breach has not been cured by the earlier of 30 calendar days after the giving of notice to the breaching party of such breach or the Effective Time; provided, however, that there shall be no cure period in connection with any breach of Section 6.3, so long as such breach by Purchaser was not caused by any action or inaction of Seller, and Seller may terminate this Agreement immediately if regulatory applications are not filed within 30 calendar days after the date of this Agreement as provided in that Section; or
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(f)
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by Purchaser or Seller in writing at any time after any applicable regulatory authority has denied approval of any application of Purchaser or Seller for approval of the transactions contemplated herein.
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In the event of termination pursuant to Section 9.1, and except as otherwise stated therein, written notice thereof shall be given to the other party, and this Agreement shall terminate immediately upon receipt of such notice unless an extension is consented to by the party having the right to terminate.
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(a)
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each party will return all documents, work papers and other materials of the other party, including photocopies or other duplications thereof, relating to this transaction, whether obtained before or after the execution hereof, to the party furnishing the same; and
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(b)
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all information received by either party hereto with respect to the business of the other party (other than information which is a matter of public knowledge or which has heretofore been published in any publication for public distribution or filed as public information with any governmental authority) shall not at any time be used for any business purpose by such party or disclosed by such party to third persons.
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If to Seller:
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The Bank of Hampton Roads
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999 Waterside Dr., Suite 200
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Norfolk, Virginia 23510
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Attn: Douglas J. Glenn, Esq.
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Telephone: (757) 217-3634
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Fax: (757) 217-3656
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With a copy to:
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Williams Mullen
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999 Waterside Dr., Suite 1700
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Norfolk, Virginia 23510
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Attn: William A. Old, Jr.
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Telephone: (757) 629-0613
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Fax: (757) 629-0660
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If to Purchaser:
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The East Carolina Bank
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35050 US Highway 264
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P.O. Box 337
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Engelhard, North Carolina 27824
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Attn: A. Dwight Utz
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Telephone: (252) 925-9411
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Fax: (252) 925-8491
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With a copy to:
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Kilpatrick Townsend & Stockton LLP
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607 14th Street, N.W., Suite 900
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Washington, DC 20005
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Attn: Gary R. Bronstein, Esq.
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Telephone: (202) 508-5893
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Fax: (202) 204-5616
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SELLER:
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THE BANK OF HAMPTON ROADS
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By:
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Name:
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Title:
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PURCHASER:
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THE EAST CAROLINA BANK
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By:
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Name:
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Title:
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Schedule No.
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Description
|
||
1
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Banking Centers
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||
1.1(a)(1)
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Improved Real Property
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1.1(a)(2)
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Unimproved Real Property
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1.1(a)(3)
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Leased Real Property
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1.1(a)(4)
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Personal Property
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||
1.1(a)(5)
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Equipment Leases and Assignable Contracts
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1.1(b)
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Excluded Assets
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1.2(a)(2)
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Banking Centers Where Deposit Liabilities Are Being Sold
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1.3(a)
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Deposit Liabilities
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1.6
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Employees Who Will Be Offered Employment
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||
4.6(a)
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Agreements Regarding the Real Property
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||
6.23
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New Leased Real Property
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||
6.24
|
Market Competition
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||
Exhibit No.
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Description
|
||
1.4(k)
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Power of Attorney
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2.2(b)(2)
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Form of Bill of Sale
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2.2(b)(3)
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Form of Assignment and
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Assumption Agreement
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2.2(b)(14)
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Form of Closing Statement
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6.23
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Form of Lease Agreement
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Banking Centers
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Preston Corners: |
4725 SW Cary Pkwy Cary, NC
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Plymouth: |
433 US Highway 64 East Plymouth, NC
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Chapel Hill Land: |
5002 Barbee Chapel Road, Chapel Hill, NC
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Brier Creek Land: |
7901 ACC Boulevard, Raleigh, NC
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Wakefield Land: |
13100 New Falls of Neuse Road, Raleigh, NC
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Lake Boone: |
2235 Gateway Access Point Raleigh, NC
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Chapel Hill: |
504 Meadowmont Village Circle Chapel Hill, NC
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Falls of Neuse: |
8470 Falls of Neuse Rd Raleigh, NC
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Durham Land: |
1133 West NC 54 Highway, Durham, NC
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Roper: |
102 West Buncombe Street Roper, NC
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Wilmington: | 901 Military Cutoff Rd Wilmington, NC |
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Contact:
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Douglas J. Glenn
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Executive Vice President, General Counsel and
|
|
Chief Operating Officer
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Hampton Roads Bankshares
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(757) 217-3634
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A. Dwight Utz
|
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President and Chief Executive Officer
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ECB Bancorp
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(252) 925-5509
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