Unassociated Document
SECURITIES
AND EXCHANGE COMMISSION
Washington, D.C.
20549
Report
of Foreign Private Issuer
Pursuant
to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of
1934
For
April 24, 2007
Commission
File Number: 001-14624
ABN
AMRO HOLDING N.V.
Gustav
Mahlerlaan 10
1082 PP Amsterdam
The
Netherlands
(Address
of principal
executive offices)
Indicate
by check mark whether the registrant files or will file
annual reports under cover of Form 20-F or Form
40-F.
Indicate
by check mark if the registrant is submitting the Form 6-K
in paper as permitted by Regulation S-T Rule 101(b)(1): ____
Indicate
by check mark if the registrant is submitting the Form 6-K
in paper as permitted by Regulation S-T Rule 101(b)(7): ____
Indicate
by check mark whether the registrant by furnishing the
information contained in this Form is also thereby furnishing the
information to the Commission pursuant to Rule 12g3-2(b) under the
Securities Exchange Act of 1934.
If
“Yes” is marked, indicate below the file number assigned to the registrant
in connection with Rule 12g3-2(b):
_____
PURCHASE
AND SALE AGREEMENT
by
and
between
ABN
AMRO
BANK N.V.
and
BANK
OF
AMERICA CORPORATION
___________________________
Dated
as
of April 22, 2007
___________________________
TABLE
OF CONTENTS
PAGE
|
|
|
DEFINITIONS
|
1
|
|
1.1
|
|
Certain
Defined Terms
|
1
|
|
ARTICLE
II
|
|
THE
SALE
|
7
|
|
2.1
|
|
The
Sale
|
7
|
|
2.2
|
|
Purchase
Price
|
7
|
|
2.3
|
|
Closing
|
8
|
|
ARTICLE
III
|
|
REPRESENTATIONS
AND WARRANTIES OF SELLER
|
9
|
|
3.1
|
|
Corporate
Organization
|
9
|
|
3.2
|
|
Capitalization
|
10
|
|
3.3
|
|
Authority;
No Violation
|
10
|
|
3.4
|
|
Consents
and Approvals
|
11
|
|
3.5
|
|
Reports
|
11
|
|
3.6
|
|
Financial
Statements
|
12
|
|
3.7
|
|
Undisclosed
Liabilities
|
13
|
|
3.8
|
|
Absence
of Certain Changes or Events
|
13
|
|
3.9
|
|
Legal
Proceedings
|
13
|
|
3.10
|
|
Taxes
and Tax Returns
|
13
|
|
3.11
|
|
Employee
Benefit Plans
|
15
|
|
3.12
|
|
Employee
Matters
|
17
|
|
3.13
|
|
Compliance
with Applicable Law
|
18
|
|
3.14
|
|
Material
Contracts
|
19
|
|
3.15
|
|
Agreements
with Regulatory Agencies
|
19
|
|
3.16
|
|
Investment
Securities
|
20
|
|
3.17
|
|
Derivative
Instruments
|
20
|
|
3.18
|
|
Environmental
Liability
|
20
|
|
3.19
|
|
Insurance
|
21
|
|
3.20
|
|
Properties
|
21
|
|
3.21
|
|
Intellectual
Property
|
21
|
|
3.22
|
|
Sufficiency
of Assets
|
21
|
|
3.23
|
|
No
Investment Adviser
|
22
|
|
3.24
|
|
Broker-Dealer
Subsidiaries
|
22
|
|
3.25
|
|
Intercompany
Arrangements; Interested Party Transactions
|
23
|
|
3.26
|
|
Divested
Businesses
|
23
|
|
3.27
|
|
Broker’s
Fees
|
23
|
|
ARTICLE
IV
|
|
REPRESENTATIONS
AND WARRANTIES OF PURCHASER
|
23
|
|
4.1
|
|
Corporate
Organization
|
23
|
|
4.2
|
|
Authority;
No Violation
|
23
|
|
4.3
|
|
Consents
and Approvals
|
24
|
|
4.4
|
|
Financial
Wherewithal
|
24
|
TABLE
OF CONTENTS
(continued)
PAGE
|
4.5
|
|
Legal
Proceedings
|
25
|
|
4.6
|
|
Agreements
with Regulatory Agencies
|
25
|
|
4.7
|
|
Broker’s
Fees
|
25
|
|
4.8
|
|
Acquisition
of Company Common Stock for Investment
|
25
|
|
ARTICLE
V
|
|
COVENANTS
RELATING TO CONDUCT OF BUSINESS
|
25
|
|
5.1
|
|
Conduct
of Business of the Company Prior to the Closing
|
25
|
|
5.2
|
|
Forbearances
of Seller
|
25
|
|
5.3
|
|
No
Solicitation
|
29
|
|
ARTICLE
VI
|
|
ADDITIONAL
AGREEMENTS
|
31
|
|
6.1
|
|
Regulatory
Matters
|
31
|
|
6.2
|
|
Access
to Information
|
32
|
|
6.3
|
|
Public
Disclosure
|
33
|
|
6.4
|
|
Employees;
Employee Benefit Matters
|
33
|
|
6.5
|
|
Nonsolicit
of Employees
|
35
|
|
6.6
|
|
Additional
Agreements
|
36
|
|
6.7
|
|
Transition
Services Agreement
|
36
|
|
6.8
|
|
Additional
Agreements Regarding Tax Matters
|
36
|
|
6.9
|
|
Post-Closing
Confidentiality
|
39
|
|
6.10
|
|
Cooperation
|
39
|
|
6.11
|
|
Use
of Name
|
40
|
|
6.12
|
|
Settlement
of Intercompany Accounts; Termination of Intercompany Agreements;
Conversion of Certain Company Debt into Equity; Funding
Subsidiaries
|
40
|
|
6.13
|
|
Specified
Transfers
|
42
|
|
6.14
|
|
No
Additional Representations
|
42
|
|
6.15
|
|
Director
and Officer Indemnification
|
42
|
|
ARTICLE
VII
|
|
CONDITIONS
PRECEDENT
|
43
|
|
7.1
|
|
Conditions
to Each Party’s Obligation to Effect the Closing
|
43
|
|
7.2
|
|
Conditions
to Obligations of Purchaser
|
44
|
|
7.3
|
|
Conditions
to Obligations of Seller
|
44
|
|
ARTICLE
VIII
|
|
TERMINATION
AND AMENDMENT
|
45
|
|
8.1
|
|
Termination
|
45
|
|
8.2
|
|
Effect
of Termination
|
46
|
|
8.3
|
|
Amendment
|
46
|
|
8.4
|
|
Extension;
Waiver
|
46
|
|
ARTICLE
IX
|
|
INDEMNIFICATION
|
47
|
|
9.1
|
|
No
Survival of Representations, Warranties and Covenants
|
47
|
TABLE
OF CONTENTS
(continued)
PAGE
|
9.2
|
|
Indemnification
by Seller
|
47
|
|
9.3
|
|
Indemnification
by Purchaser
|
48
|
|
9.4
|
|
Tax
Indemnification
|
48
|
|
9.5
|
|
Indemnification
Procedure
|
48
|
|
9.6
|
|
Certain
Offsets; Tax Treatment of Payments
|
50
|
|
9.7
|
|
Exclusive
Remedy
|
51
|
|
ARTICLE
X
|
|
GENERAL
PROVISIONS
|
51
|
|
10.1
|
|
Expenses
|
51
|
|
10.2
|
|
Notices
|
51
|
|
10.3
|
|
Interpretation;
Absence of Presumption
|
52
|
|
10.4
|
|
Counterparts
|
53
|
|
10.5
|
|
Entire
Agreement
|
53
|
|
10.6
|
|
Governing
Law and Venue; Waiver of Jury Trial
|
53
|
|
10.7
|
|
Specific
Performance
|
55
|
|
10.8
|
|
Severability
|
55
|
|
10.9
|
|
Assignment;
Third-Party Beneficiaries
|
55
|
PURCHASE
AND SALE AGREEMENT
This
PURCHASE AND SALE AGREEMENT, dated as of April 22, 2007 (this “Agreement”),
is by
and between ABN AMRO Bank N.V., a company organized under the laws of The
Netherlands (“Seller”),
and
Bank of America Corporation, a Delaware corporation (“Purchaser”).
RECITALS
WHEREAS,
Seller
holds, directly or indirectly, all of the outstanding shares, par value $1.00
per share, of common stock (the “Company
Common Stock”)
of ABN
AMRO North America Holding Company, a Delaware corporation (the “Company”);
WHEREAS,
Seller desires to sell and transfer, and Purchaser desires to purchase, the
Company Common Stock, on the terms and subject to the conditions set forth
in
this Agreement; and
WHEREAS,
the parties desires to make certain representations, warranties, covenants
and
agreements in connection with this Agreement.
NOW,
THEREFORE, in
consideration of the foregoing and the representations, warranties, covenants
and agreements set forth herein, and for other good and valuable consideration,
and intending to be legally bound, the parties hereto agree as follows:
ARTICLE
I
DEFINITIONS
1.1. Certain
Defined Terms.
Unless
the context otherwise requires, the following terms, when used in this
Agreement, shall have the respective meanings specified below (such meanings
to
be equally applicable to the singular and plural forms of the terms
defined):
“Affiliate”
of
a
Person shall mean any other Person that directly, or indirectly through one
or
more intermediaries, controls, or is controlled by, or is under common control
with, such Person.
“Affiliate
Arrangements”
shall
mean any agreement, contract or arrangement between Seller and its Affiliates
(other than the Company and its Subsidiaries), on the one hand, and the Company
and its Subsidiaries, on the other hand.
“Agreed
Claims”
shall
have the meaning stated in Section 9.5(c).
“Agreement”
shall
have the meaning stated in the preamble to this document.
“Balance
Sheet”
shall
have the meaning stated in Section 3.6(a).
“Balance
Sheet Date”
shall
have the meaning stated in Section 3.6(a).
“BHCA”
shall
mean the Bank Holding Company Act of 1956, as amended.
“Broker-Dealer
Subsidiary”
shall
have the meaning stated in Section 3.24.
“Business”
shall
mean the businesses of the Company and its Subsidiaries, other than the Excluded
Business and any Divested Business.
“Business
Day”
shall
mean any day other than a Saturday, Sunday or day on which banking institutions
in New York, New York are authorized or obligated pursuant to legal requirements
or executive order to be closed.
“Bylaws”
shall
mean the Bylaws of the Company, as currently in effect.
“Certificate
of Incorporation”
shall
mean the Certificate of Incorporation of the Company, as currently in
effect.
“Claim
Certificate”
shall
have the meaning stated in Section 9.5(a).
“Closing”
shall
have the meaning stated in Section 2.3(a).
“Closing
Date”
shall
mean the date on which the Closing actually occurs.
“Closing
Income Statement”
shall
have the meaning stated in Exhibit C.
“Closing
Net Income”
shall
have the meaning stated in Exhibit C.
“Code”
shall
mean the Internal Revenue Code of 1986, as amended.
“Company”
shall
have the meaning stated in the first Recital.
“Company
Benefit Plans”
shall
have the meaning stated in Section 3.11(a).
“Company
Confidential Information”
shall
mean confidential information and data (including confidential files, customer
lists, mailing lists, documentation or records) concerning the customers and
prospects, products and services, employees, intellectual property (including
trade secrets), technology, financial or business plans and operations, and
unpublished confidential financial information of or relating to the Business,
the Company or the Company Subsidiaries.
“Company
Common Stock”
shall
have the meaning stated in the recitals.
“Company
Employees”
shall
have the meaning stated in Section 6.4(a).
“Company
Financial Statements”
shall
have the meaning stated in Section 3.6(a).
“Company
Intellectual Property”
shall
have the meaning stated in Section 3.21.
“Company-Only
Plans”
shall
have the meaning stated in Section 3.11(a).
“Company
Regulatory Agreement”
shall
have the meaning stated in Section 3.15.
“Company
Subsidiary”
and
“Company
Subsidiaries”
shall
have the meaning stated in Section 3.1(b).
“Confidentiality
Agreement”
shall
mean the Confidentiality Agreement dated as of April 19, 2007 by and between
Seller and Purchaser (as it may be amended from time to time).
“Conforming
Confidentiality Agreement”
shall
mean an agreement that contains confidentiality provisions that are no less
favorable to Seller than those contained in the Confidentiality Agreement,
and
is enforceable by Seller and, after the Closing, by the Company or Purchaser
as
an express third-party beneficiary.
“Controlled
Group Liability”
means
any and all liabilities (i) under Title IV of ERISA, (ii) under Section 302
of
ERISA, (iii) under Sections 412 and 4971 of the Code, (iv) as a result of a
failure to comply with the continuation coverage requirements of Section 601
et
seq. of ERISA and Section 4980B of the Code, or (v) under corresponding or
similar provisions of foreign laws or regulations, other than such liabilities
that arise solely out of, or relate solely to, the Company-Only Plans identified
as such in Section 3.11(a) of the Disclosure Schedule.
“Corporate
Entity”
shall
mean a bank, corporation, partnership, limited liability company or other
organization, whether an incorporated or unincorporated
organization.
“Covered
Claim”
shall
have the meaning stated in Section 10.6(b).
“Covered
Taxes”
shall
mean Taxes attributable to any Excluded Business and Taxes resulting from the
Specified Transfers.
“CRA”
shall
mean the Community Reinvestment Act of 1997.
“Damages”
shall
mean all costs, expenses, damages, liabilities, claims, demands, obligations,
diminution in value, fine, awards, judgments, losses, royalty, proceeding,
deficiency, interest, awards, judgments and penalties (including reasonable
expenses and attorneys’ fees and consultants’ fees and expenses) suffered or
incurred.
“Disclosing
Party”
shall
have the meaning stated in Section 6.9.
“Disclosure
Schedule”
shall
mean the disclosure schedule dated as of the date of the Agreement and delivered
by Seller to Purchaser prior to the execution and delivery of the
Agreement.
“Divested
Business”
shall
mean any company, business, product line, business unit or business operation
that was owned, operated or conducted by the Company or any Company Subsidiary
(or any predecessor thereto) or any former Subsidiary thereof, at any time
prior
to the Closing and that is not owned, operated or conducted by a Company or
any
Company Subsidiary as of the Closing Date (without giving effect to any
temporary or transitional arrangements under any Transition Services Agreement
or that otherwise may be implemented in connection with the
transactions
contemplated hereby to facilitate a smooth transition of ownership), in each
case, whether as a result of a sale, transfer, distribution, contribution,
conveyance, or other disposition.
“Employees”
shall
have the meaning stated in Section 5.2(e).
“ERISA”
shall
have the meaning stated in Section 3.11(a).
“Estimated
Net Income”
shall
have the meaning stated in Exhibit C.
“Excluded
Business”
shall
mean the businesses, assets and liabilities of ABN AMRO WCS Holding Company
and
its Subsidiaries.
“Excluded
Employees”
shall
have the meaning stated in Section 6.4(c).
“Federal
Court”
shall
have the meaning stated in Section 10.6(b).
“Federal
Reserve Board”
shall
mean the Board of Governors of the Federal Reserve System.
“Final
Net Income”
shall
have the meaning stated in Exhibit C.
“Form
BD”
shall
have the meaning stated in Section 3.24(b).
“Former
Excluded Employees”
shall
have the meaning stated in Section 6.4(d).
“GAAP”
means
accounting principles generally accepted in the United States.
“Governmental
Entity”
shall
mean any court, administrative agency, arbitrator or commission or other
governmental, prosecutorial or regulatory authority or instrumentality, or
any
SRO.
“HSR
Act”
shall
mean the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended.
“Income
Threshold”
shall
have the meaning stated in Exhibit C.
“Indemnified
Party”
shall
have the meaning stated in Section 9.5(a).
“Indemnifying
Party”
shall
have the meaning stated in Section 9.5(a).
“Intellectual
Property”
shall
mean any or all of the following: all patents, trademarks, trade names, service
marks, domain names, database rights, copyrights and any applications therefore,
mask works, know-how, trade secrets, and computer software programs or
applications (in both source code and object code form).
“Interim
Period”
shall
mean any taxable year or period commencing on or prior to the Closing Date
and
ending after the Closing Date.
“IRS”
shall
mean the U.S. Internal Revenue Service.
“Key
Employees”
shall
have the meaning stated in Section 6.5.
“Knowledge”
or
“knowledge”
with
respect to Seller shall mean the actual knowledge of those individuals set
forth
on Exhibit B.
“Leased
Properties”
shall
have the meaning stated in Section 3.20.
“Lien”
shall
mean any lien, claim, charge, option, encumbrance, mortgage, pledge or security
interest or other restriction of any kind.
“Matching
Period”
shall
have the meaning stated in Section 5.3(b).
“Material
Adverse Effect”
shall
mean any event, circumstance, change or effect that (i) has a material
adverse effect on the business, results of operations or financial condition
of
the Business; or (ii) prevents Seller from consummating the transactions
contemplated hereby; provided,
however,
that,
with respect to clause (i), Material Adverse Effect shall not be deemed to
include effects to the extent resulting from (A) changes, after the date
hereof, in generally accepted accounting principles or regulatory accounting
requirements applicable to depository institutions and their holding companies
generally, (B) changes, after the date hereof, in laws, rules or
regulations of general applicability to depository institutions and their
holding companies generally, or interpretations thereof by courts or
Governmental Entities, (C) changes, after the date hereof, in global or
national or regional political conditions (including the outbreak of war or
acts
of terrorism) or in general or regional economic or market conditions affecting
depository institutions and their holding companies generally except to the
extent that such changes in political, economic or market conditions have a
disproportionate adverse effect on the Business, (D) public disclosure of
this Agreement and the transactions contemplated by this Agreement, (E) any
action taken by Seller, the Company or any of their respective Subsidiaries
which is expressly required pursuant to this Agreement, or (F) any action taken
or not taken to which the Purchaser has expressly and specifically consented
or
which Purchaser has expressly and specifically requested.
“Material
Contracts”
shall
have the meaning stated in Section 3.14(a).
“Materially
Burdensome Regulatory Condition”
shall
have the meaning stated in Section 6.1(a).
“Measurement
Period”
shall
have the meaning stated in Exhibit C.
“Multiemployer
Plan”
shall
have the meaning stated in Section 3.11(b).
“Multiple
Employer Plan”
shall
have the meaning stated in Section 3.11(b).
“National
Bank Subsidiaries”
shall
mean LaSalle Bank N.A. and LaSalle Bank Midwest N.A.
“New
Plans”
shall
have the meaning stated in Section 6.4(b).
“New
York Courts”
shall
have the meaning stated in Section 10.6(b).
“OCC”
shall
mean the U.S. Office of the Comptroller of the Currency.
“Owned
Properties”
shall
have the meaning stated in Section 3.20.
“PBGC”
shall
have the meaning stated in Section 3.11(f).
“Permitted
Encumbrances”
shall
have the meaning stated in Section 3.20.
“Person”
shall
mean any individual, Corporate Entity or Governmental Entity.
“Post-Closing
Period”
shall
mean any taxable year or period that begins after the Closing Date, and, with
respect to any Interim Period, the portion of such Interim Period commencing
after the Closing Date.
“Pre-Closing
Period”
shall
mean any taxable year or period that ends on or before the Closing Date, and,
with respect to any Interim Period, the portion of such Interim Period
ending on and including the Closing Date.
“Process
Agent”
shall
have the meaning stated in Section 10.6(d).
“Purchase
Price”
shall
have the meaning stated in Section 2.2.
“Purchaser”
shall
have the meaning stated in the preamble.
“Purchaser
Indemnitees”
shall
have the meaning stated in Section 9.2.
“Purchaser
Material Adverse Effect”
shall
mean, with respect to Purchaser, any effect that prevents, or would be
reasonably likely to prevent, Purchaser from consummating the transactions
contemplated hereby.
“Purchaser
Representatives”
shall
have the meaning stated in Section 6.2(a).
“Qualified
Purchaser”
shall
have the meaning stated in Section 5.3(b).
“Real
Property”
shall
have the meaning stated in Section 3.20.
“Regulatory
Agencies”
shall
have the meaning stated in Section 3.5.
“Reports”
shall
have the meaning stated in Section 3.5.
“Requisite
Regulatory Approvals”
shall
have the meaning stated in Section 7.1(a).
“Sale”
shall
have the meaning stated in Section 2.1.
“Seller”
shall
have the meaning stated in the preamble.
“Seller
Indemnitees”
shall
have the meaning stated in Section 9.3.
“Solicitation
Period”
shall
have the meaning stated in Section 5.3(b).
“Specified
Transfers”
shall
have the meaning stated in Section 6.13.
“SRO”
shall
mean any domestic or foreign securities, broker-dealer, investment adviser
and
insurance industry self-regulatory organization.
“Subsidiary”
shall
mean, when used with respect to any party, any Corporate Entity which is
consolidated with such party for financial reporting purposes. “Subsidiary”,
when
used with respect to the Company, shall not include any Corporate Entity which
(i) is part of the Excluded Business, (ii) part of a Divested Business or (iii)
transferred by the Company or any of its Subsidiaries to Seller or any of its
Subsidiaries (other than the Company and its Subsidiaries) as part of the
Specified Transfers.
“Superior
Proposal”
shall
have the meaning stated in Section 5.3(b).
“Tax”
or
“Taxes”
shall
mean all federal, state, local, and foreign income, excise, gross receipts,
gross income, ad valorem, profits, gains, property, capital, sales, transfer,
use, value-added, stamp, documentation, payroll, employment, severance,
withholding, duties, license, intangibles, franchise, backup withholding,
environmental, occupation, alternative or add-on minimum taxes, imposed by
any
Governmental Entity, and other taxes, charges, levies or like assessments,
and
including all penalties and additions to tax and interest thereon.
“Tax
Data”
shall
have the meaning stated in Section 6.8(h).
“Tax
Documentation”
shall
have the meaning stated in Section 6.8(h).
“Tax
Return”
shall
mean any return, declaration, report, statement, information statement and
other
document filed or required to be filed with respect to Taxes, including any
schedule or attachment thereto, and including any amendment
thereof.
“Transition
Services Agreement”
shall
mean any transition services agreement entered into pursuant to Section
6.7.
ARTICLE
II
THE
SALE
2.1. The
Sale.
Upon the
terms and subject to the conditions set forth in this Agreement, at the Closing,
Seller shall (or shall cause its applicable Subsidiaries to) sell, assign,
transfer, convey and deliver to Purchaser, and Purchaser shall purchase and
acquire from Seller and its applicable Subsidiaries, all right, title and
interest in, to and under all of the outstanding shares of Company Common Stock,
free and clear of any Liens or rights or claims of others (the “Sale”).
2.2. Purchase
Price.
In
consideration for the Company Common Stock, at the Closing, Purchaser shall
pay
to Seller an aggregate of U.S.$21,000,000,000 (twenty-one billion) in cash
(the
“Purchase
Price”)
as
adjusted pursuant to Exhibit C.
2.3. Closing.
(a) Subject
to
the terms and conditions of this Agreement, the closing of the sale of the
Company Common Stock to the Purchaser (the “Closing”)
shall
take place as soon as practicable, and in any event no later than the first
Business Day of the next calendar month following the month in which the
conditions set forth in Article VII hereof (other than conditions to be
satisfied at Closing, but subject to their satisfaction) have been satisfied
or
waived (subject to applicable law), unless extended by mutual agreement of
the
parties.
The
Closing shall take place at the offices of Wachtell, Lipton, Rosen & Katz,
51 West 52nd
Street,
New York, New York 10019, or at such other location as the parties hereto may
agree.
(b) At
the
Closing:
(i) Purchaser
shall:
(A) pay
to
Seller by wire transfer, to an account designated by Seller not less than two
Business Days prior to the Closing, immediately available funds in an amount
equal to the Purchase Price as adjusted pursuant to Exhibit C; and
(B) deliver
the certificate contemplated by Section 7.3(c).
(ii) Seller
shall:
(A) deliver
to
Purchaser, free and clear of any Liens or rights or claims of others, the stock
certificate representing the Company Common Stock, duly endorsed in blank (or
accompanied by duly executed stock powers) and with any required stock transfer
stamps affixed thereto;
(B) deliver
to
Purchaser all books and records of the Business in the possession of Seller
or
any of its Subsidiaries, other than (1) books and records that Seller or
any of its Subsidiaries is required by Law to retain (in which case Seller
shall
deliver copies thereof to Seller); and (2) personnel and employment records
for employees and former employees of the Seller or any of its Subsidiaries
who
are not Transferred Entity Employees; provided
that
Seller and its Subsidiaries shall have the right to retain a copy of all such
books and records to the extent reasonably necessary for, and for use in
connection with, Tax, regulatory, litigation or other legitimate,
non-competitive purposes; and
(C) deliver
the certificates contemplated by Sections 7.2(c) and 7.2(d).
ARTICLE
III
REPRESENTATIONS
AND WARRANTIES OF SELLER
Except
as
disclosed in the Disclosure Schedule (it being agreed that disclosure in any
Section of the Disclosure Schedule shall apply only to the indicated Section
of
this Agreement, except to the extent that it is reasonably apparent on the
face
of the disclosure that such disclosure is relevant to another Section of this
Agreement), Seller represents and warrants to Purchaser that the following
is
true and correct:
3.1. Corporate
Organization.
(a) The
Seller
has been duly incorporated and is validly existing as a public company with
limited liability under the laws of The Netherlands. The Company is a
corporation duly organized, validly existing and in good standing under the
laws
of the jurisdiction of its organization. Each of Seller and the Company has
the
corporate or other organizational power and authority to own or lease all of
its
properties and assets and to carry on its business as it is now being conducted,
and is duly licensed or qualified to do business in each jurisdiction in which
the nature of the business conducted by it or the character or location of
the
properties and assets owned or leased by it makes such licensing or
qualification necessary, except where the failure to be so licensed or qualified
would not reasonably be expected to, individually or in the aggregate, have
a
Material Adverse Effect. The Company is duly registered as a bank holding
company under the BHCA and is a financial holding company pursuant to Section
4(l) of the BHCA and meets in all material respects the applicable requirements
for qualification as such. True and complete copies of the Certificate of
Incorporation and Bylaws, as in effect as of the date of this Agreement, have
previously been furnished or made available to Purchaser. The Company is not
in
violation in any material respect of any of the provisions of the Certificate
of
Incorporation or Bylaws.
(b) Section
3.1(b)
of the
Disclosure Schedule sets forth a complete and correct list as of the date hereof
of all the Subsidiaries of the Company (each a “Company
Subsidiary”
and
collectively the “Company
Subsidiaries”).
The
shares of Company Preferred Stock held by Persons other than the Company and
its
Subsidiaries have a liquidation preference of no more than $200,000,000. All
of
the outstanding shares of capital stock or other securities evidencing ownership
of, or an equity ownership in, the Company Subsidiaries are validly issued,
fully paid and nonassessable and such shares or other securities are owned
entirely by the Company or a wholly owned Company Subsidiary, free and clear
of
any Lien with respect thereto. There are no outstanding subscriptions, options,
warrants, puts, calls, rights, exchangeable or convertible securities or other
commitments or agreements of any character relating to the issued or unissued
capital stock or other securities or ownership or equity interests of any
Company Subsidiary, or otherwise obligating any Company Subsidiary to issue,
transfer, sell, purchase, redeem or otherwise acquire any such stock, securities
or interests. Each Company Subsidiary (i) is a duly organized and validly
existing corporation, partnership or limited liability company or other legal
entity under the laws of its jurisdiction of organization, (ii) is duly
qualified to do business and is in good standing in all jurisdictions (whether
federal, state, local or foreign) where its ownership or leasing of property
or
the conduct of its business requires it to be so qualified (except for
jurisdictions in which the failure to be so qualified
would
not
reasonably be expected to, individually or in the aggregate, have a Material
Adverse Effect) and (iii) has all requisite corporate or other legal entity
power and authority to own or lease its properties and assets and to carry
on
its business as now conducted. Except for its interests in the Company
Subsidiaries, the Company does not own, directly or indirectly, any capital
stock, membership interest, partnership interest, joint venture interest or
other equity interest with a fair market value as of the date of this Agreement
in excess of $25 million in any Person other than in the ordinary course of
business.
3.2. Capitalization.
The
authorized capital stock of the Company consists of 1,000 shares of Company
Common Stock, of which 1,000 are issued and outstanding and have been duly
authorized and validly issued, are fully paid, non-assessable and free of
preemptive rights, and 2,987,538 shares of Company preferred stock, of which
1,562,500 are issued and outstanding and have been duly authorized and validly
issued. The shares of Company preferred stock held by Persons other than the
Company and its Subsidiaries have a liquidation preference of no more than
$200,000,000. All of the Company Common Stock is owned by Seller, free and
clear
of any Liens. Except as set forth above, no shares of capital stock or other
voting securities, equity securities or other ownership or equity interests
of
the Company are issued, reserved for issuance or outstanding. There are no
outstanding subscriptions, options, warrants, puts, calls, rights, exchangeable
or convertible securities or other commitments or agreements of any character
relating to the issued or unissued capital stock or other securities or
ownership or equity interests of the Company, or otherwise obligating the
Company to issue, transfer, sell, purchase, redeem or otherwise acquire any
such
stock, securities or interests.
3.3. Authority;
No Violation.
(a) Seller
has
full corporate power and authority to execute and deliver this Agreement and
to
consummate the transactions contemplated hereby. The execution and delivery
of
this Agreement and the consummation of the transactions contemplated hereby
have
been duly and validly approved by the supervisory and managing boards of Seller.
No other corporate proceedings (including any approvals of Seller’s
stockholders) on the part of Seller are necessary to approve this Agreement
and
to consummate the transactions contemplated hereby. This Agreement has been
duly
and validly executed and delivered by Seller. Assuming due authorization,
execution and delivery by Purchaser, this Agreement constitutes a valid and
binding obligation of Seller, enforceable against Seller in accordance with
its
terms, except as such enforcement may be limited by (i) the effect of
bankruptcy, insolvency, reorganization, receivership, conservatorship,
arrangement, moratorium or other laws affecting or relating to the rights of
creditors generally, or (ii) the rules governing the availability of
specific performance, injunctive relief or other equitable remedies and general
principles of equity, regardless of whether considered in a proceeding in equity
or at law.
(b) Neither
the execution and delivery of this Agreement by Seller nor the consummation
by
Seller of the transactions contemplated hereby, nor compliance by Seller with
any of the terms or provisions hereof, will (i) violate any provision of
the Certificate of Incorporation or Bylaws or similar organizational documents
of Seller or the Company or any of their respective Subsidiaries,
(ii) assuming that the consents, approvals and filings referred to in
Section 3.4
are duly
obtained and/or made, (x) violate any statute, code, ordinance, rule,
regulation, judgment, order, writ, decree or injunction applicable to Seller,
the Company or any
of
their
respective Subsidiaries or any of their respective properties or assets or
(y) violate, conflict with, result in a breach of any provision of or the
loss of any benefit under, constitute a default (or an event which, with notice
or lapse of time, or both, would constitute a default) under, result in the
termination of or a right of termination or cancellation under or in any payment
conditioned, in whole or in part, on a change of control of the Company or
any
of its Subsidiaries or approval or consummation of transactions of the type
contemplated hereby, accelerate the performance required by or rights or
obligations under, or result in the creation of any Lien upon any of the
respective properties or assets of the Company or any of its Subsidiaries under,
any of the terms, conditions or provisions of any note, bond, mortgage,
indenture, deed of trust, license, lease, agreement, contract, or other
instrument or obligation to which Seller, the Company or any of their respective
Subsidiaries is a party, or by which they or any of their respective properties,
assets or business activities may be bound or affected, except (in the case
of
clause (ii)(y) above) for such violations, conflicts, breaches, defaults or
the loss of benefits which would not reasonably be expected to, individually
or
in the aggregate, have a Material Adverse Effect.
3.4. Consents
and Approvals.
Except
for (i) the filing of any required applications or notices with the Federal
Reserve Board under the BHCA or the Federal Reserve Act, as amended, and
approval of such applications and notices, (ii) the filing of any required
applications, filings or notices with any other U.S. federal or state banking,
broker-dealer, insurance or other U.S. regulatory or self-regulatory authorities
or instrumentalities, (iii) any consents, authorizations, approvals, filings
or
exemptions in connection with compliance with the rules and regulations of
any
applicable industry SRO, and the rules of the Nasdaq, or that are required
under
U.S. consumer finance, mortgage banking and other similar laws, (iv) any
consents, authorizations, approvals, filings with any federal authority or
instrumentality, (v) any notices or filings (and, if required, approvals)
under the HSR Act, and (vi) any consents, approvals, filings or registration,
the absence of which would not reasonably be expected to, individually or in
the
aggregate, have a Material Adverse Effect, no consents or approvals of or
filings or registrations with any Governmental Entity are necessary in
connection with (A) the execution and delivery by Seller of this Agreement
and (B) the consummation of the transactions contemplated by this
Agreement.
3.5. Reports.
The
Company and each of its Subsidiaries have, filed all reports, forms,
correspondence, registrations and statements, together with any amendments
required to be made with respect thereto (“Reports”),
that
they were required to file since January 1, 2005 with (i) any SRO,
(ii) the Federal Reserve Board, (iii) the Federal Deposit Insurance
Corporation, (iv) the OCC and (v) any other federal, state or foreign
governmental or regulatory agency or authority (the agencies and authorities
identified in clauses (i) through (v), inclusive, are, collectively, the
“Regulatory
Agencies”),
and
all other reports and statements required to be filed by them since
January 1, 2005, including any report or statement required to be filed
pursuant to the laws, rules or regulations of the United States, any state,
or
any Regulatory Agency and have paid all fees and assessments due and payable
in
connection therewith, except where the failure to file such report, registration
or statement or to pay such fees and assessments would not reasonably be
expected to, individually or in the aggregate, have a Material Adverse Effect.
Any such Report and any statement regarding the Business, the Company or its
Subsidiaries made in any Report filed with or otherwise submitted to any
Regulatory Agency complied in all material respects with relevant legal
requirements, including as to content. Except for normal examinations
conducted
by a Regulatory Agency in the ordinary course of the business of the Company
and
its Subsidiaries, there is no material pending proceeding before, or, to the
Knowledge of Seller, material investigation by, any Regulatory Agency into
the
business or operations of the Company or any of its Subsidiaries. There are
no
unresolved violations, criticisms, or exceptions by any Regulatory Agency with
respect to any report or statement relating to any examinations of the Company
or any of its Subsidiaries, except for any such violations, criticisms or
exceptions are not, individually or in the aggregate, material to the Company
and its Subsidiaries.
3.6. Financial
Statements.
(a) Seller
has
previously made available to Purchaser copies of the following financial
statements, copies of which are attached as Schedule 3.6(a): (i) the
audited consolidated statements of condition, consolidated statements of income,
consolidated statements of stockholders’ equity and consolidated statements of
cash flows of the Company and its Subsidiaries as of and for the fiscal year
ended December 31, 2005 and December 31, 2006 (the “Audited
Financial Statements”);
and
(ii) the unaudited pro forma consolidated statement of condition, and pro
forma consolidated statement of income of the Business as of and for the fiscal
year ended December 31, 2006 (the “Pro
Forma Financial Statements”
and
together with the Audited Financial Statements, the “Company
Financial Statements”)
(the
unaudited pro forma consolidated statement of condition as of December, 31,
2006, the “Balance
Sheet”
and
December 31, 2006, the “Balance
Sheet Date”).
The
Audited Financial Statements fairly present in all material respects the
consolidated financial position and results of operations of the Company as
of
the respective dates or for the respective periods therein set forth and have
been prepared in accordance with GAAP consistently applied during the periods
involved.
The Pro
Forma Financial Statements fairly present in all material respects the
consolidated financial position and results of operations of the Business as
of
the respective dates or for the respective periods therein set forth and have
been prepared in accordance with GAAP consistently applied during the periods
involved except for the absence of footnote disclosure. The Company Financial
Statements have been prepared from, and are in accordance with, the books and
records of the Company and its Subsidiaries.
(b) Stockholders’
equity on the consolidated statement of condition of the Company and its
Subsidiaries as of December 31, 2006 included $394.534 million of preferred
stock issued by Subsidiaries of the Company.
(c) Seller
maintains, with respect to the Business and the Company and its Subsidiaries,
a
system of internal control over financial reporting.
(d) Seller
has
implemented and maintains disclosure controls and procedures (as defined in
Rule
13a-15(e) of the Exchange Act) to ensure that information material assessed
at
the level of Seller and relating to Seller, including the Business, the Company
and its Subsidiaries, is made known to the chief executive officer and the
chief
financial officer of Seller by others within those entities. Section
3.6(d) of the Disclosure Schedule sets forth, based on Seller’s most recent
evaluation prior to the date hereof of its internal control over financial
reporting (as defined in Rule 13a-15(f) of the Exchange Act), (i)
any significant deficiencies or material weaknesses of Seller in the design
or
operation of internal control over financial
reporting
relating to the Business, the Company and its Subsidiaries; and (ii) any events
of fraud, whether or not material assessed at the level of Seller, that involve
management or other employees who have a significant role in the Company’s
internal controls over financial reporting and relate to the Business, the
Company or its Subsidiaries.
(e) The
books
and records of the Company and its Subsidiaries have been, and are being,
maintained in all material respects in accordance with GAAP and any other
applicable legal and accounting requirements and reflect only actual
transactions. The minute books of the Company and its Subsidiaries that have
been made available to Purchaser contain accurate records in all material
respects of all corporate actions of the Company and its Subsidiaries for the
relevant periods.
3.7. Undisclosed
Liabilities.
Except
for those liabilities that are reflected or reserved against on the Balance
Sheet, and except for liabilities incurred since the Balance Sheet Date in
the
ordinary course of business, neither Company nor any of its Subsidiaries has
any
liability of any nature whatsoever (whether absolute, accrued, contingent or
otherwise and whether due or to become due) that, individually or in the
aggregate with any other such liabilities, would reasonably be expected to
have
a Material Adverse Effect.
3.8. Absence
of Certain Changes or Events.
Since
the Balance Sheet Date: (i) the Company and its Subsidiaries have, in all
material respects, carried on their respective businesses in the ordinary course
consistent with their past practices; (ii) the Company has not taken any of
the
actions that Seller has agreed not to permit Company to take from the date
hereof through the Closing Date pursuant to Sections 5.2(a), (b), (c), (d),
(f),
(g), (h), (i), (j) or (l) of this Agreement, and (iii) there have been no
events, circumstances, facts or occurrences that have had, or would reasonably
be expected to have, individually or in the aggregate, a Material Adverse
Effect.
3.9. Legal
Proceedings.
None of
Seller, the Company nor any of their respective Subsidiaries is a party to
or
subject of any, and there are no pending or, to the Knowledge of Seller,
threatened, legal, administrative, arbitral or other proceedings, claims,
actions or governmental or regulatory investigations of any nature against
Seller, the Company or any of their respective Subsidiaries that would
reasonably be expected to, individually or in the aggregate, have a Material
Adverse Effect. There is no material injunction, order, judgment, regulatory
restrictions (other than those of general application that apply to similarly
situated bank holding companies) or decrees imposed upon Seller or its
Subsidiaries (with respect to the Business) or the Company or any Company
Subsidiaries, or the assets of the Company or any Company
Subsidiary.
3.10. Taxes
and Tax Returns.
Except as
would not reasonably be expected to have, individually or in the aggregate,
a
Material Adverse Effect:
(a) The
Company and each of its Subsidiaries has duly and timely filed or caused to
be
filed (including all applicable extensions) all federal, state, foreign and
local Tax Returns required to be filed by it or with respect to it (all such
Tax
Returns being accurate and complete) and has duly and timely paid or caused
to
be paid on their behalf all Taxes that are due and payable other than Taxes
that
are being contested in good faith, which have not been finally determined,
and
are adequately reserved against or provided for (in accordance with
GAAP)
on
the most recent consolidated financial statements of the Company. The Company
and its Subsidiaries do not have any liability for Taxes in excess of the amount
reserved or provided for on their financial statements (but excluding, for
this
purpose only, any liability reflected thereon for deferred Taxes to reflect
timing differences between Tax and financial accounting methods).
(b) No
jurisdiction where the Company and its Subsidiaries do not file a Tax Return
has
made a claim in writing that any of the Company and its Subsidiaries is required
to file a Tax Return in such jurisdiction.
(c) No
Liens
for Taxes exist with respect to any of the assets of the Company and its
Subsidiaries, except for statutory Liens for Taxes not yet due and
payable.
(d) There
are
no audits, examinations, disputes or proceedings pending or threatened in
writing with respect to, or claims or assessments asserted or threatened in
writing for, any material amount of Taxes of the Company or any of its
Subsidiaries.
(e) There
is
no waiver or extension of the application of any statute of limitations of
any
jurisdiction regarding the assessment or collection of any Tax with respect
to
the Company and any of its Subsidiaries, which waiver or extension is in
effect.
(f) All
Taxes
required to be withheld, collected or deposited by or with respect to the
Company and each of its Subsidiaries have been timely withheld, collected or
deposited, as the case may be, and to the extent required by applicable law,
have been paid to the relevant Governmental Entity.
(g) To
the
extent the Company or any of its Subsidiaries has participated in any reportable
transaction, as defined in Treasury Regulation Section 1.6011-4(b)(1), or any
other transaction required to be reported under a comparable provision of state,
local or foreign law, such transaction has been reported in accordance with
applicable law.
(h) Neither
the Company nor any of its Subsidiaries is a party to, is bound by, or has
any
obligation under, any Tax sharing, allocation, indemnity or similar agreements
or arrangement that obligates it to make any payment computed by reference
to
the Taxes, taxable income or taxable losses of any other Person.
(i) Neither
the Company nor any of its Subsidiaries (A) has been a member of a group filing
a consolidated, combined or unitary Tax Return (other than a group the common
parent of which is or was the Company) or (B) has any liability for the Taxes
of
any person (other than the Company or any of its Subsidiaries) under Treasury
Regulation Section 1.1502-6 (or any similar provision of state, local or foreign
law), as a transferee or successor, by contract or otherwise;
(j) Neither
the Company nor any of its Subsidiaries has been, within the past two years
or
otherwise as part of a “plan (or series of related transactions)” within the
meaning of Section 355(e) of the Code of which the transactions contemplated
in
this Agreement are also a part, a “distributing corporation” or a “controlled
corporation” (within the meaning of Section
355(a)(1)(A)
of the Code) in a distribution of stock intended to qualify for Tax-free
treatment under Section 355 of the Code.
(k) Neither
the Company nor any of its Subsidiaries will be required to include any item
of
income in, or exclude any item of deduction from, taxable income for any
Post-Closing Period as a result of any (i) change in method of accounting for
a
Pre-Closing Period under Section 481(c) of the Code (or any corresponding or
similar provision of state, local or foreign law), (ii) “closing agreement”
described in Section 7121 of the Code (or any corresponding or similar provision
of state, local or foreign law), (iii) installment sale or open transaction
disposition or intercompany transaction made on or prior to the Closing Date,
or
(iv) prepaid amount received on or prior to the Closing Date.
(l) No
Subsidiary of the Company is characterized as a “foreign” corporation for U.S.
federal income tax purposes.
3.11. Employee
Benefit Plans.
(a) Section
3.11(a) of the Disclosure Schedule lists all material “employee benefit plans,”
as defined in Section 3(3) of the Employee Retirement Income Security Act of
1974, as amended (“ERISA”),
whether or not subject to ERISA, and all other material employee benefit,
severance or executive compensation plans, policies, practices, programs,
arrangements, or agreements, whether written or unwritten, that cover any
current or former directors, officers, employees or consultants of Company
or
its Subsidiaries, or to which contributions must be made or liabilities are
outstanding thereunder for current or former directors, officers, employees
or
consultants of Company or its Subsidiaries, or to which any such individual
is
party (collectively, the “Company
Benefit Plans”).
For
purposes hereof, each Company Benefit Plan that is sponsored by Company or
its
Subsidiaries is referred to as a “Company-Only
Plan”.
(b) None
of
the Company Benefit Plans is a “multiemployer plan,” as defined in Section
4001(a)(3) of ERISA (a “Multiemployer
Plan”)
or a
plan that has two or more contributing sponsors at least two of whom are not
under common control (a “Multiple
Employer Plan”).
None
of Company or any of its Subsidiaries, Seller or their respective ERISA
Affiliates has (i) contributed to or been obligated to contribute to, at any
time during the past six years, a Multiemployer Plan or a Multiple Employer
Plan, (ii) withdrawn in a complete or partial withdrawal from any Multiemployer
Plan or Multiple Employer Plan or (iii) incurred any liability due to the
termination or reorganization of a Multiemployer Plan or a Multiple Employer
Plan.
(c) The
Company and each of its Subsidiaries has reserved the right to amend, terminate
or modify at any time all Company Benefit Plans providing for retiree health
or
life insurance coverage.
(d) Except
in
each case for such items that individually or in the aggregate would not have
a
Material Adverse Effect, (i) each Company Benefit Plan and its administration
is
in material compliance with its terms and all applicable laws, including ERISA
and the Code; (ii) each Company Benefit Plan that is intended to be “qualified”
under Section 401 of the Code has received a favorable determination letter
from
the IRS to such effect and no fact,
circumstance
or event has occurred or exists since the date of such determination letter
that
would adversely affect the qualified status of any such Company Benefit Plan;
and (iii) each Company Benefit Plan that is a “nonqualified deferred
compensation plan” subject to Section 409A of the Code has been operated in
compliance with Section 409A of the Code since January 1, 2005, based upon
a
good faith, reasonable interpretation of Section 409A of the Code and the
guidance issued by the Internal Revenue Service thereunder; provided that no
representation is being made under clause (iii) with respect to final
regulations under Section 409A of the Code that were issued on April 10,
2007.
(e) All
contributions (including all employer contributions and employee salary
reduction contributions), premiums and other payments required to have been
made
under any of the Company Benefit Plans to any funds or trusts established
thereunder or in connection therewith have been made by the due date thereof,
other than a failure to make contributions that would not have a Material
Adverse Effect, and with respect to any such contributions, premiums or other
payments required that are not yet due, to the extent required by GAAP, adequate
reserves are reflected on the Balance Sheet or liability therefor was incurred
in the ordinary course of business consistent with past practice since the
end
of such fiscal quarter.
(f) Except
in
each case for such items that individually or in the aggregate would not have
a
Material Adverse Effect, (i) no liability has been, or is reasonably expected
to
be, incurred under Section 4062 of ERISA to the Pension Benefit Guaranty
Corporation (the “PBGC”)
or to a
trustee appointed under Section 4042 of ERISA; and (ii) with respect to each
Company-Benefit Plan that is subject to Title IV or Section 302 of ERISA or
Section 412 or 4971 of the Code: (A) there does not exist any accumulated
funding deficiency within the meaning of Section 412 of the Code or Section
302
of ERISA, whether or not waived; (B) as of the last day of the most recent
fiscal plan year ended prior to the date hereof, the fair market value of the
assets of such plan equals or exceeds the actuarial present value of all accrued
benefits under such plan (whether or not vested) on an accumulated benefit
obligation basis; (C) no reportable event within the meaning of Section 4043(c)
of ERISA for which the 30-day notice requirement has not been waived has
occurred, and the consummation of the transactions contemplated by this
agreement will not result in the occurrence of any such reportable event; (D)
all premiums to the PBGC have been timely paid in full; (E) no liability (other
than for premiums to the PBGC) under Title IV of ERISA has been or is reasonably
expected to be incurred by Company or any of its Subsidiaries; and (F) the
PBGC
has not instituted proceedings to terminate any such plan and, to Company’s
knowledge, no condition exists that presents a material risk that such
proceedings will be instituted or which would constitute grounds under Section
4042 of ERISA for the termination of, or the appointment of a trustee to
administer, any such plan.
(g) None
of
Company, its Subsidiaries, the officers of Company or the Company Benefit Plans
which are subject to ERISA, any trusts created thereunder or any trustee or
administrator thereof, has engaged in a “prohibited transaction” (as such term
is defined in Section 406 of ERISA or Section 4975 of the Code) or any other
breach of fiduciary responsibility that could subject Company, its Subsidiaries
or any officer of Company to any Tax or penalty on prohibited transactions
imposed by such Section 4975 or to any liability under Section 502(i) or (1)
of
ERISA other than, in each case, a Tax, penalty or liability that would not
have
a Material Adverse Effect.
(h) Except
as
would not have a Material Adverse Effect or as set forth on Section 3.11(h)
of
the Disclosure Schedule, neither the execution and delivery of this Agreement
nor the consummation of the transactions contemplated hereby will (either alone
or in conjunction with any other event) result in, cause the accelerated
vesting, funding or delivery of, or increase the amount or value of, any payment
or benefit to any employee, officer or director of Company or any of its
Subsidiaries, or result in any limitation on the right of Company or any of
its
Subsidiaries to amend, merge, terminate or receive a reversion of assets from
any Company Benefit Plan or related trust. Without limiting the generality
of
the foregoing, except as would not have a Material Adverse Effect, no amount
paid or payable (whether in cash, in property, or in the form of benefits)
in
connection with the transactions contemplated hereby (either solely as a result
thereof or as a result of such transactions in conjunction with any other event)
will be an “excess parachute payment” within the meaning of Section 280G of the
Code. No Company-Only Plan provides for a “gross up” or similar payments in
respect of any Taxes that may become payable under Section 409A or Section
4999(a) of the Code.
(i) True,
correct and complete copies of the following documents, with respect to each
Company Benefit Plan that is an “employee benefit plan” within the meaning of
Section 3(3) of ERISA and is subject to the provisions of ERISA, have, as
applicable, been delivered or made available to Purchaser by Seller: (i) the
written document evidencing such Company Benefit Plan and the related trust
documents or other funding arrangements, and amendments, and (ii) the summary
plan description thereof. No later than 30 days following the date hereof,
Seller will provide Purchaser with true, correct and complete copies of the
following documents, with respect to all Company Benefit Plans to the extent
not
previously provided: (1) the written document evidencing such plan and the
related trust documents or other funding arrangements, and amendments,
modifications or supplements thereto or, with respect to any such plan that
is
not in writing, a written description thereof; and (2) the most recent Forms
5500 and schedules thereto; (3) the summary plan description and any
modifications thereto; (4) the most recent annual report, financial statement
and/or actuarial report; and (5) the most recent determination letter from
the
IRS.
(j) There
are
no pending actions, claims or lawsuits which have been asserted, instituted
or,
to Knowledge of Seller, threatened, against the Company Benefit Plans, the
assets of any of the trusts under such plans or the plan sponsor or the plan
administrator, or against any fiduciary of Company Benefit Plans with respect
to
the operation of such plans (other than routine benefit claims) which could
result in any liability to Company that would reasonably be expected to have
a
Material Adverse Effect.
(k) Except
as
would not have a Material Adverse Effect, all Company-Only Plans subject to
the
laws of any jurisdiction outside of the United States (i) have been maintained
in accordance with all applicable requirements, (ii) if they are intended to
qualify for special tax treatment meet all requirements for such treatment,
and
(iii) if they are intended to be funded and/or book-reserved, are fully funded
and/or book reserved, as appropriate, based upon reasonable actuarial
assumptions.
3.12. Employee
Matters.
(a) Neither
Company nor any of its Subsidiaries is, or has over the past five years been,
a
party to any collective bargaining agreement or other labor union contract.
No
labor organization or group of employees of the Company or any of its
Subsidiaries has made a pending demand for recognition or certification, and
there are no representation or certification proceedings or petitions seeking
a
representation proceeding presently pending or threatened to be brought or
filed, with the National Labor Relations Board or any other labor relations
tribunal or authority. There are no organizing activities, strikes, work
stoppages, slowdowns, lockouts, material arbitrations or material grievances,
or
other material labor disputes pending or threatened against or involving the
Company or any of its Subsidiaries.
(b) The
Company and each of its Subsidiaries has complied in all material respects
with
all applicable material laws relating to the employment of employees, including
those relating to wages, hours, immigration, the payment of wages, and the
classification of employees as exempt or not exempt from the payment of overtime
under applicable law, the prohibitions against discrimination and harassment,
occupational safety and health, and leaves of absence, except for such
noncompliance as would not be material to the Company and its Subsidiaries,
taken as a whole.
3.13. Compliance
with Applicable Law.
(a) The
Company and each Company Subsidiary and each of their employees, and Seller
and
each of its Subsidiaries and their employees insofar as it relates to the
Business, hold all licenses, registrations, franchises, permits and
authorizations necessary for the lawful conduct of their respective businesses
and are and have been in compliance with, and are not and have not been in
violation of, any applicable law, statute, order, rule, regulation, policy
and/or guideline of any Governmental Entity, except in each case where the
failure to hold such license, registration, franchise, permit or authorization
or such noncompliance or violation would not reasonably be expected to,
individually or in the aggregate, have a Material Adverse Effect, and neither
the Company nor any of its Subsidiaries has knowledge of, or has received notice
of any violations of any of the above, except for such violations that would
not
reasonably be expected to, individually or in the aggregate, have a Material
Adverse Effect.
(b) Except
as
would not be material to the Company and its Subsidiaries, taken as a whole,
the
Company and each of its Subsidiaries have properly administered all accounts
for
which the Company or any of its Subsidiaries acts as a fiduciary, including
accounts for which the Company or any of its Subsidiaries serves as a trustee,
agent, custodian, personal representative, guardian, conservator or investment
adviser, in accordance with the terms of the governing documents, applicable
state and federal law and regulation and common law. None of the Company or
any
of its Subsidiaries, or any director, officer or employee of the Company or
any
of its Subsidiaries, has committed any breach of trust with respect to any
such
fiduciary account that would be material to the Company and its Subsidiaries,
taken as a whole, and the accountings for each such fiduciary account are true
and correct in all material respects and accurately reflect in all material
respects the assets of such fiduciary account.
(c) Each
National Bank Subsidiary is “well-capitalized” (as that term is defined at 12
C.F.R. 6.4(b)(1) or the relevant regulation of the institution’s primary federal
bank regulator), and “well managed” (as that term is defined at 12 C.F.R.
225.2(s)), and the institution’s CRA rating is no less than “satisfactory.”
Neither National Bank Subsidiary has been informed that its status as
“well-capitalized,” “well managed” or “satisfactory” for CRA purposes will
change within one year. All deposit liabilities of the National Bank
Subsidiaries are insured by the Federal Deposit Insurance Corporation to the
fullest extent under the law. The National Bank Subsidiaries have met all
conditions of such insurance, including timely payment of its
premiums.
3.14. Material
Contracts.
(a) Neither
the Company nor any of its Subsidiaries is a party to or bound by, as of the
date hereof, any contract, arrangement, commitment or understanding (whether
written or oral) (i) that would be a “material contract” (as such term is
defined in Item 601(b)(10) of Regulation S-K of the SEC) of the Company and
its
Subsidiaries to be performed after the date of this Agreement that has not
been
filed or incorporated by reference in the periodic reports of Seller filed
with
the SEC prior to the date of this Agreement or otherwise set forth on Section
3.14(a) of the Disclosure Schedule, (ii) that contains (A) any material
non-competition or non-solicitation agreement, or any other agreement or
obligation which purports to limit or restrict in any material respect the
ability of the Company or its Affiliates (including, after the Closing,
Purchaser and its Affiliates) or their businesses to solicit customers or the
manner in which, or the localities in which, all or any portion of the business
of the Company or its Affiliates (including, after the Closing, Purchaser and
its Affiliates) is or may be conducted or (B) any material exclusive dealing
agreement or any material agreement that grants any right of first refusal
or
right of first offer or similar right or that limits or purports to limit the
ability of the Company or any of its Affiliates (including, after the Closing,
Purchaser and its Affiliates) to own, operate, sell, transfer, pledge or
otherwise dispose of any material assets or business or (iii) with or to a
labor union or guild (including any collective bargaining agreement). Each
contract, arrangement, commitment or understanding of the type described in
this
Section 3.14(a), whether or not set forth in the Company Disclosure Schedule,
and each Affiliate Arrangement is referred to as a “Material
Contract,”
and
neither the Company nor any of its Subsidiaries knows of, or has received notice
of, any violation of any Material Contract by any of the other parties
thereto.
(b) (i)
Each
Material Contract is valid and binding on the Company or its applicable
Subsidiary and is in full force and effect, (ii) the Company and each of its
Subsidiaries has performed all of the obligations required to be performed
by it
to date under each Material Contract, and (iii) no event or condition exists
that constitutes or, after notice or lapse of time or both, will constitute,
a
default on the part of the Company or any of its Subsidiaries under any such
Material Contract, in each case except as would not reasonably be expected
to
have, individually or in the aggregate, a Material Adverse Effect.
3.15. Agreements
with Regulatory Agencies.
Except
as is not material, neither the Company nor any Company Subsidiary, and none
of
Seller or any of its Subsidiaries with respect to the Business, is subject
to
any cease-and-desist or other order or enforcement action issued by, or is
a
party to any written agreement, consent agreement or memorandum of understanding
with,
or
is a party to any commitment letter or similar undertaking to, or is subject
to
any order or directive by, or since January 1, 2005 has been ordered to pay
any
civil penalty by, or is a recipient of any supervisory letter from, or has
outstanding any board resolutions adopted at the request or suggestion of any
Regulatory Agency or other Governmental Entity that restricts the conduct of
its
business or that relates to its capital adequacy, its ability to pay dividends,
its credit or risk management policies, its management or its business (each,
whether or not set forth in the Disclosure Schedule, a “Company
Regulatory Agreement”),
nor
has
the Company nor any of its Subsidiaries been advised since January 1, 2005
by
any Regulatory Agency or other Governmental Entity that it is considering
issuing or requiring any such Company Regulatory Agreement.
3.16. Investment
Securities.
Except
as would not reasonably be expected to, individually or in the aggregate, have
a
Material Adverse Effect, (i) each of the Company and its Subsidiaries has good
and marketable title to all securities held by it (except securities sold under
repurchase agreements or held in any fiduciary or agency capacity) free and
clear of any Lien, except to the extent such securities are pledged in the
ordinary course of business consistent with prudent business practices to secure
obligations of the Company or any of its Subsidiaries and except for such
defects in title or Liens that would not be material to the Company and its
Subsidiaries and (ii) such securities are valued on the books of the Company
and
its Subsidiaries in accordance with GAAP.
3.17. Derivative
Instruments.
Except
as
would not reasonably be expected to, individually or in the aggregate, have
a
Material Adverse Effect, (i) all Derivative Transactions (as herein defined)
were entered into in the ordinary course of business consistent with past
practice and in accordance with prudent banking practices and applicable rules,
regulations and policies of any Regulatory Agency and other policies, practices
and procedures employed by the Company and its Subsidiaries and with
counterparties believed at the time to be financially responsible and are legal,
valid and binding obligations of the Company or one of its Subsidiaries
enforceable against it in accordance with their terms (except as may be limited
by bankruptcy, insolvency, moratorium, reorganization or similar laws affecting
the rights of creditors generally and the availability of equitable remedies),
and are in full force and effect, (ii) the Company and each of its Subsidiaries
have duly performed their obligations under the Derivative Transactions to
the
extent required, and (iii) to the Knowledge of Seller, there are no breaches,
violations or defaults or allegations or assertions of such by any party
thereunder. As used herein, “Derivative
Transactions”
means
any swap transaction, option, warrant, forward purchase or sale transaction,
futures transaction, cap transaction, floor transaction or collar transaction
relating to one or more currencies, commodities, bonds, equity securities,
loans, interest rates, prices, values, or other financial or non-financial
assets, credit-related events or conditions or any indexes, or any other similar
transaction or combination of any of these transactions, including
collateralized any debt or equity instruments evidencing or embedding any such
types of transactions, and any related credit support, collateral or other
similar arrangements related to such transactions.
3.18. Environmental
Liability.
Except
as
would not reasonably be expected to, individually or in the aggregate, have
a
Material Adverse Effect, there are no pending or, to the knowledge of Seller,
threatened legal, administrative, arbitral or other proceedings, claims, or
actions against the Company or any of its Subsidiaries seeking to impose, or
that are reasonably likely to result in, any liability or obligation of the
Company or any of its Subsidiaries under any
local,
state or federal environmental, health or safety statute, regulation, law
(including Common Law) or ordinance, including the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended; and neither the
Company nor any of its Subsidiaries is subject to any agreement, order,
judgment, decree, letter or memorandum by or with any Governmental Entity or
third party imposing any liability or obligation on such entity with respect
to
any of the foregoing.
3.19. Insurance.
The
Company has in full force and effect the insurance coverage with respect to
its
business as of the date hereof set forth in Section 3.19
of the
Disclosure Schedule.
3.20. Properties.
Except as
would not reasonably be expected to have, individually or in the aggregate,
a
Material Adverse Effect, the Company or one of its Subsidiaries (a) has (or
will
have, at Closing) good and marketable title to all the owned real properties
reflected in the Balance Sheet (except properties sold or otherwise disposed
of
since the date of the Balance Sheet in the ordinary course of business) (the
“Owned
Properties”),
free
and clear of all Liens of any nature whatsoever, except (i) statutory Liens
securing payments not yet due (or being conducted in good faith and for which
adequate reserves have been established), (ii) Liens for real property
Taxes not yet due and payable, (iii) easements, rights of way, and other
similar encumbrances that do not materially affect the use of the properties
or
assets subject thereto or affected thereby or otherwise materially impair
business operations at such properties and (iv) such imperfections or
irregularities of title or Liens as do not materially affect the use of the
properties or assets subject thereto or affected thereby or otherwise materially
impair business operations at such properties (collectively, “Permitted
Encumbrances”),
and
(b) is the lessee of all leasehold estates reflected in the Balance Sheet
(except for leases that have expired by their terms since the date thereof)
(the
“Leased
Properties”
and,
collectively with the Owned Properties, the “Real
Property”),
free
and clear of all Liens of any nature whatsoever, except for Permitted
Encumbrances, and is in possession of the properties purported to be leased
thereunder, and each such lease is valid without default thereunder by the
lessee or, to the Knowledge of Seller, the lessor.
3.21. Intellectual
Property. Except
as
would not reasonably be expected to have, individually or in the aggregate,
a
Material Adverse Effect, (i) the Company and its Subsidiaries
own, or are licensed or otherwise possess rights to use, all Intellectual
Property used by Company and its Subsidiaries as of the date hereof
(collectively, the “Company
Intellectual Property”)
in the
manner that it is currently used by Company and its Subsidiaries, (ii) neither
Company nor any of its Subsidiaries has received written notice from any third
party alleging any interference, infringement, misappropriation or violation
of
any Intellectual Property rights of any third party and, neither Company nor
any
of its Subsidiaries has interfered in any respect with, infringed upon,
misappropriated or violated any Intellectual Property rights of any third party;
(iii) to the Knowledge of Seller, no third party has interfered with, infringed
upon, misappropriated or violated any Company Intellectual Property; (iv)
neither Company nor any of its Subsidiaries licenses to, or has entered into
any
exclusive agreements relating to any Company Intellectual Property with, third
parties, or permits third parties to use any Company Intellectual Property
rights; (v) neither Company nor any of its Subsidiaries owes any material
royalties or payments to any third party for using or licensing to others any
Company Intellectual Property and (vi) neither the Company nor any of its
Subsidiaries is a party to any agreement to
indemnify
any Person against a claim of infringement of or misappropriation by any Company
Intellectual Property.
3.22. Sufficiency
of Assets
Except as
would not reasonably be expected to have, individually or in the aggregate,
a
Material Adverse Effect, at the Closing, the Company and its Subsidiaries will
own or have the right to use (including pursuant to the Transition Services
Agreement) all of the assets, rights and properties necessary to conduct the
Business as currently operated on the same terms as all of the foregoing were
owned or used by Seller and its Affiliates to operate the Business.
3.23. No
Investment Adviser.
Neither
the Company nor any Company Subsidiary serves in a capacity described in Section
9(a) or 9(b) of the Investment Company Act of 1940, as amended, nor acts as
an
“investment adviser” required to register as such under the Investment Advisers
Act of 1940, as amended.
3.24. Broker-Dealer
Subsidiaries.
(a) Each
Company Subsidiary that is a broker-dealer (a “Broker-Dealer
Subsidiary”)
is duly
registered under the Exchange Act as a broker-dealer with the SEC, and is in
compliance in all material respects with the applicable provisions of the
Exchange Act, including the net capital requirements and customer protection
requirements thereof. Each Broker-Dealer Subsidiary is a member in good standing
with all required SROs and in compliance in all material respects with all
applicable rules and regulations of such SROs. Each Broker-Dealer Subsidiary
and
registered representative is duly registered, licensed or qualified as a
broker-dealer or registered representative under, and in compliance in all
material respects with, the applicable laws and regulations of all jurisdictions
in which it is required to be so registered and each such registration, license
or qualification is in full force and effect and in good standing. There is
no
action, suit, proceeding or investigation pending or, to the knowledge of
Seller, threatened that would reasonably be expected to lead to the revocation,
amendment, failure to renew, limitation, suspension or restriction of any such
registrations, licenses and qualifications.
(b) Seller
has
made available to Purchaser true, correct and complete copies of each
Broker-Dealer Subsidiary’s Uniform Application for Broker-Dealer Registration on
Form BD filed since January 1, 2005, reflecting all amendments thereto to the
date hereof (each, a “Form
BD”).
The
Forms BD of the Broker-Dealer Subsidiaries are in compliance in all material
respects with the applicable requirements of the Exchange Act and do not contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein,
in
light of the circumstances under which they were made, not misleading.
(c) None
of
the Broker-Dealer Subsidiaries nor any “associated person” thereof (i) is
subject to a “statutory disqualification” as such terms are defined in the
Exchange Act, or (ii) is subject to a disqualification that would be a basis
for
censure, limitations on the activities, functions or operations of, or
suspension or revocation of the registration of any Broker-Dealer Subsidiary
as
broker-dealer, municipal securities dealer, government securities
broker
or
government securities dealer under Section 15, Section 15B or Section 15C of
the
Exchange Act.
(d) Subject
to
the foregoing, neither the Company nor its Subsidiaries is required to be
registered as a commodity trading advisor, commodity pool operator, futures
commission merchant or introducing broker under any laws or regulations.
3.25. Intercompany
Arrangements; Interested Party Transactions.
Each
material agreement and arrangement between a National Bank Subsidiary, on the
one hand, and Seller or any of its Subsidiaries or Affiliates (other than
Company and its Subsidiaries), on the other hand, is at arm’s length terms and
complies in all material respects with Section 23A and 23B of the Federal
Reserve Act and 12 C.F.R. Part 223.
3.26. Divested
Businesses.
Section
3.26 of the Disclosure Schedule sets forth a true and complete list of all
businesses that have become Divested Businesses since January 1, 2004 and which
impose material continuing obligations on the Company or its Subsidiaries or
the
Business.
3.27. Broker’s
Fees.
Except
for any firm all of whose fees and expenses shall be borne entirely by Seller,
none of Seller, the Company or any of their respective Subsidiaries has employed
any broker or finder or incurred any liability for any broker’s fees,
commissions or finder’s fees in connection with the transactions contemplated by
this Agreement.
ARTICLE
IV
REPRESENTATIONS
AND WARRANTIES
OF
PURCHASER
Purchaser
hereby represents and warrants to Seller as follows:
4.1. Corporate
Organization.
Purchaser is a corporation duly organized, validly existing and in good standing
under the laws of its jurisdiction of organization. Purchaser has the corporate
power and authority to own or lease all of its properties and assets and to
carry on its business as it is now being conducted, and is duly licensed or
qualified to do business in each jurisdiction in which the nature of the
business conducted by it or the character or location of the properties and
assets owned or leased by it makes such licensing or qualification necessary,
except where the failure to be so licensed or qualified would not reasonably
be
expected to, individually or in the aggregate, have a Purchaser Material Adverse
Effect. True and complete copies of the certificate of incorporation and bylaws
of Purchaser, as in effect as of the date of this Agreement, have previously
been delivered by Purchaser to Seller. Purchaser is not in violation of any
of
the provisions of its certificate or articles of incorporation or bylaws or
other charter or organizational documents, each as amended.
4.2. Authority;
No Violation.
(a) Purchaser
has full corporate power and authority to execute and deliver this Agreement
and
to consummate the transactions contemplated hereby. The execution and
delivery
of this Agreement and the consummation of the transactions contemplated hereby
have been duly and validly approved by the Board of Directors of Purchaser.
No
other corporate proceedings (including any approvals of Purchaser’s
stockholders) on the part of Purchaser are necessary to approve this Agreement
and to consummate the transactions contemplated hereby. This Agreement has
been
duly and validly executed and delivered by Purchaser. Assuming due
authorization, execution and delivery by Seller, this Agreement constitutes
a
valid and binding obligation of Purchaser, enforceable against Purchaser in
accordance with its terms, except as such enforcement may be limited by
(i) the effect of bankruptcy, insolvency, reorganization, receivership,
conservatorship, arrangement, moratorium or other laws affecting or relating
to
the rights of creditors generally, or (ii) the rules governing the
availability of specific performance, injunctive relief or other equitable
remedies and general principles of equity, regardless of whether considered
in a
proceeding in equity or at law.
(b) Neither
the execution and delivery of this Agreement by Purchaser, nor the consummation
by Purchaser of the transactions contemplated hereby, nor compliance by
Purchaser with any of the terms or provisions hereof, will (i) violate any
provision of the certificate of incorporation or bylaws of Purchaser or
(ii) assuming that the consents and approvals referred to in
Section 4.3
are duly
obtained, (x) violate any statute, code, ordinance, rule, regulation,
judgment, order, writ, decree or injunction applicable to Purchaser or any
of
its Subsidiaries or any of their respective properties or assets or
(y) violate, conflict with, result in a breach of any provision of or the
loss of any benefit under, constitute a default (or an event which, with notice
or lapse of time, or both, would constitute a default) under, result in the
termination of or a right of termination or cancellation under, accelerate
the
performance required by or rights or obligations under, or result in the
creation of any Lien upon any of the respective properties or assets of
Purchaser or any of its Subsidiaries under, any of the terms, conditions or
provisions of any note, bond, mortgage, indenture, deed of trust, license,
lease, agreement, contract, or other instrument or obligation to which Purchaser
or any of its Subsidiaries is a party, or by which they or any of their
respective properties, assets or business activities may be bound or affected,
except (in the case of clause (ii) above) for such violations, conflicts,
breaches, defaults or the loss of benefits that would not reasonably be expected
to, individually or in the aggregate, have a Purchaser Material Adverse
Effect.
4.3. Consents
and Approvals.
Except
for (i) the Requisite Regulatory Approvals and (ii) such additional consents
and
approvals, the failure of which to make or obtain would not be material and
would not have a Purchaser Material Adverse Effect, no consents or approvals
of
or filings or registrations with any Governmental Entity or, of or with any
third party, are necessary in connection with (A) the execution and
delivery by Purchaser of this Agreement and (B) the consummation by
Purchaser of the transactions contemplated hereby. Purchaser has no reason
to
believe that any Requisite Regulatory Approvals will not be
obtained.
4.4. Financial
Wherewithal.
Purchaser has or will have as of the Closing sufficient cash or cash equivalents
available, directly or through one or more Affiliates, to pay the Purchase
Price
to Seller on the terms and conditions contained herein, and there is no
restriction on the use of such cash or cash equivalents for such
purpose.
4.5. Legal
Proceedings.
(a) Neither
Purchaser nor any of its Subsidiaries is a party to any, and there are no
pending or, to the knowledge of Purchaser, threatened, legal, administrative,
arbitral or other proceedings, claims, actions or governmental or regulatory
investigations of any nature against Purchaser or any of its Subsidiaries that
would reasonably be expected to, individually or in the aggregate, have a
Purchaser Material Adverse Effect.
(b) There
is
no injunction, order, judgment or decree imposed upon Purchaser, any of its
Subsidiaries or the assets of Purchaser or any of its Subsidiaries that would
reasonably be expected to, individually or in the aggregate, have a Purchaser
Material Adverse Effect.
4.6. Agreements
with Regulatory Agencies.
Neither
Purchaser nor any of its Subsidiaries is subject to any cease-and-desist or
other order or enforcement action issued by, or is a party to any written
agreement, consent agreement or memorandum of understanding with, or is a party
to any commitment letter or similar undertaking to, or is subject to any order
or directive
that
would reasonably be expected to, individually or in the aggregate, have a
Purchaser Material Adverse Effect.
4.7. Broker’s
Fees.
Except
for any firm all of whose fees and expenses shall be borne entirely by
Purchaser, neither Purchaser nor any of its Subsidiaries has employed any broker
or finder or incurred any liability for any broker’s fees, commissions or
finder’s fees in connection with the transactions contemplated by this
Agreement.
4.8. Acquisition
of Company Common Stock for Investment.
Purchaser is acquiring the Company Common Stock for investment and not with
a
view toward or for sale in connection with any distribution thereof, or with
any
present intention of distributing or selling the Company Common Stock. Purchaser
acknowledges that the Company Common Stock have not been registered under the
Securities Act or any state securities Laws, and agrees that the Company Common
Stock may not be sold, transferred, offered for sale, pledged, hypothecated
or
otherwise disposed of without registration under the U.S. Securities Act of
1933, as amended, except pursuant to an exemption from such registration
available under the U.S. Securities Act of 1933, as amended, and without
compliance with foreign securities laws, in each case, to the extent applicable.
ARTICLE
V
COVENANTS
RELATING TO CONDUCT OF BUSINESS
5.1. Conduct
of Business of the Company Prior to the Closing.
During
the period from the date of this Agreement until the earlier of the Closing
or
the termination of this Agreement in accordance with its terms, Seller shall,
and shall cause the Company and each Company Subsidiary to, (a) conduct the
Business in all material respects in the usual, regular and ordinary course
consistent with past practice and (b) use commercially reasonable efforts
to maintain and preserve intact the business organizations and goodwill of
the
Business and the
Business’
current relationships with its customers, regulators, employees and other
Persons with which the Business has significant business or other relationships.
5.2. Forbearances
of Seller.
During
the period from the date of this Agreement until the earlier of the Closing
or
the termination of this Agreement in accordance with its terms, except as set
forth in Section 5.2 of the Disclosure Schedule, as expressly contemplated
by
this Agreement or as required by Applicable Law or Governmental Entity, Seller
shall cause the Company and the Company Subsidiaries not to do any of the
following, without the prior written consent of Purchaser, which shall not
be
unreasonably withheld or delayed:
(a) other
than
in the ordinary course of business consistent with past practices, (i)
incur any indebtedness for borrowed money, or assume, guarantee, endorse or
otherwise as an accommodation become responsible for the obligations of any
other individual, corporation or other entity, or make any loan or advance
(it
being understood and agreed that incurrence of indebtedness in the ordinary
course of business consistent with past practice shall include the creation
of
deposit liabilities, purchases of Federal funds and FHLB advances, sales of
certificates of deposit, issuances of commercial paper and entering into
repurchase agreements); or (ii) incur any capital expenditures (other than
capital expenditures incurred pursuant to contracts or commitments in force
on
the date of this Agreement);
(b) other
than
with respect to the Excluded Business, (i) adjust, split, combine or
reclassify any capital stock, (ii) make, declare or pay any dividend or
distribution or make any other distribution on any shares of its capital stock
(other than (A) dividends on shares of its outstanding preferred stock made
in
accordance with the terms of the applicable certificate of designations, or
(B)
by any Company Subsidiary on a pro rata basis to the equity owners thereof;
provided
that the
Company itself shall not be permitted to make any dividend) or redeem, purchase
or otherwise acquire any securities or obligations convertible into or
exchangeable for any shares of its capital stock (and Seller agrees that no
such
dividend shall have been paid by the Company since December 31, 2006 other
than
dividends on shares of its outstanding preferred stock made in accordance with
the terms of the applicable certificate of designations), (iii) grant any
stock appreciation rights or grant to any individual, corporation or other
entity any right to acquire any shares of its capital stock, (iv) issue any
additional shares of capital stock or (v) enter into any agreement,
understanding or arrangement with respect to the sale or voting of its capital
stock;
(c) other
than
with respect to the Excluded Business, sell, transfer, mortgage, encumber or
otherwise dispose of any of its properties or assets, including capital stock
in
any Company Subsidiary and cash, to any individual, corporation or other entity
other than a direct or indirect wholly-owned Company Subsidiary, or to any
Excluded Business, or cancel, release or assign any indebtedness to any such
person or any claims held by any such person (and Seller agrees that no such
action with respect to the Excluded Business shall have occurred since December
31, 2006), except (i) in the ordinary course of business
consistent
with past practice to third parties who are not Affiliates of the Company,
(ii)
in the ordinary course of business consistent with past practice to Affiliates
of the Company on arm’s length terms, (iii) pursuant to contracts or agreements
in force at the date of this Agreement that are, if involving properties or
assets having a value in excess of $5,000,000 or any capital stock in any
Company Subsidiary, set forth in the Disclosure Schedule or (iv) otherwise
with
respect to properties, assets and indebtedness with an aggregate fair market
value not in excess of $10,000,000 other than to Seller or its
Affiliates;
(d) (i) acquire
any business entity, whether by stock purchase, merger, consolidation or
otherwise, (ii) make any other investment either by purchase of stock or
securities, contributions to capital, property transfers, or purchase of any
property or assets of any other individual, corporation, limited partnership
or
other entity other than a wholly-owned Company Subsidiary, or (iii) incur,
assume or accept any liability of the Excluded Business, other than, in the
case
of clause (ii), (A) for investments in the ordinary course of business
consistent with past practice and (B) investments for cash consideration with
an
aggregate value not in excess of $10,000,000;
(e) (i)
except
(A) as required under applicable law or the terms of any existing agreement
to which Company is a party as of the date hereof, and (B) for increases in
annual base salary at times and in amounts in the ordinary course of business
consistent with past practice, which shall not exceed 4% in the aggregate (on
an
annualized basis), increase in any manner the compensation or benefits of any
of
the current or former directors, officers or employees of Company or its
Subsidiaries (collectively “Employees”),
(ii)
pay any amounts to Employees not required by any current plan or agreement
(other than base salary in the ordinary course of business) to any Employee,
(iii) become a party to, establish, amend, commence participation in, terminate
or commit itself to any stock option plan or other stock-based compensation
plan, compensation (including any employee co-investment fund), severance,
pension, retirement, profit-sharing, welfare benefit, or other employee benefit
plan or agreement or employment agreement with or for the benefit of any
Employee (or newly hired employees), (iv) accelerate the vesting of any
stock-based compensation or other long-term incentive under any Company Benefit
Plans, (v) hire or terminate the employment of any current Employee who has
(in
the case of employees to be terminated) or would have (in the case of employees
to be hired) target total compensation (cash and target equity) of $350,000
or
more, other than terminations for cause, or (vi) except as set forth in Section
6.4(d) of this Agreement, transfer any current Employee to Seller or its
Affiliates (other than the Company or its Subsidiaries);
(f) settle
any
claim, action or proceeding other than claims, actions or proceedings in the
ordinary course of business consistent with past practice involving solely
money
damages not in excess of $5,000,000 individually or $10,000,000 in the aggregate
or involving non-monetary relief that is not
material,
or waive or release any material rights or claims other than in the ordinary
course of business consistent with past practice;
(g) change
its
methods of accounting (or the manner in which it accrues for liabilities) in
effect on the Balance Sheet Date, except as required by changes in GAAP;
(h) make,
change or revoke any Tax election, change an annual Tax accounting period,
adopt
or change any Tax accounting method, file any amended Tax Return, enter into
any
closing agreement with respect to Taxes, settle any Tax claim or assessment
or
surrender any right to claim a refund of Taxes if such action would likely
have
the effect of increasing in any material respect the liability of the Company
or
its Subsidiaries for any Taxes other than Covered Taxes unless required by
applicable law;
(i) adopt
or
implement any amendment to its Certificate of Incorporation or any changes
to
its Bylaws or comparable organizational documents;
(j) materially
restructure or materially change its investment securities portfolio or its
gap
position except in the ordinary course of business consistent with past practice
(and in consultation with Purchaser), through purchases, sales or otherwise,
or
the manner in which the portfolio is classified or reported;
(k) enter
into, amend in any material respect or terminate, or make any payment not then
required under, any Material Contract, other than entering into, renewing or
terminating any Material Contracts in the ordinary course of business consistent
with past practice, other than any Material Contract that contains (A) any
non-competition or non-solicitation agreement, or any other agreement or
obligation which purports to limit or restrict in any material respect the
ability of the Company or its Affiliates (including, after the Closing,
Purchaser and its Affiliates) or their businesses to solicit customers or the
manner in which, or the localities in which, all or any portion of the business
of the Company or its Affiliates (including, after the Closing, Purchaser and
its Affiliates) is or may be conducted or (B) any material exclusive dealing
agreement, or any material agreement that grants any right of first refusal
or
right of first offer or similar right or that limits or purports to limit the
ability of the Company or any of its Affiliates (including, after the Closing,
Purchaser and its Affiliates) to own, operate, sell, transfer, pledge or
otherwise dispose of any material assets or business;
(l) enter
into
any new line of business that is material to the Company and its Subsidiaries,
taken as a whole, or materially change its lending, investment, underwriting,
risk and asset liability management and other banking and operating policies
that are material to the Company and its Subsidiaries,
taken
as a
whole, except as required by applicable law, regulation or policies imposed
by
any Governmental Entity;
(m) take
any
action that is intended or would be reasonably likely to result in any of the
conditions set forth in Article VII not being satisfied, except, in every case,
as may be required by applicable law;
(n) (i)
materially modify, amend or terminate, or waive any rights under, any Affiliate
Arrangement, or (ii) enter into any new Affiliate Arrangement or any transaction
with Seller or any Affiliate of Seller except in the ordinary course of business
consistent with past practice and on arm’s length terms; or
(o) agree
to,
or make any commitment to, take any of the actions prohibited by this Section
5.2.
5.3. No
Solicitation.
(a) Non-Solicit.
Except
as
expressly provided in Section 5.3(b), Seller shall, shall cause its Affiliates
to and shall use all reasonable efforts to cause its Representatives to,
immediately cease and cause to be terminated any discussion or negotiation
with
any Person conducted theretofore by Seller or any of its Affiliates or
Representatives with respect to any Acquisition Proposal and, to the extent
it
is entitled to do so, under the applicable confidentiality obligation cause
to
be returned or destroyed all confidential information provided by or made
available to such Person on behalf of Seller or any of its Affiliates. Except
as
expressly provided in Section 5.3(b), from the date hereof until the earlier
of
the Closing and the termination of this Agreement in accordance with its terms,
Seller shall not, shall cause its Affiliates not to and shall use all reasonable
efforts to cause its Representatives not to, directly or indirectly, (i)
solicit, initiate, knowingly encourage or accept the submission of any proposal
or offer relating to any Acquisition Proposal, or (ii) participate in any
discussions or negotiations (and each of the foregoing shall immediately cease
any discussions or negotiations that are ongoing) regarding, furnish any
information with respect to, assist or knowingly participate in any effort
or
attempt by any third party to do or seek any of the foregoing. For purposes
of
this Agreement, “Acquisition
Proposal”
means
any offer or proposal, or any indication of interest in making an offer or
proposal, made by a Person or group at any time which is structured to permit
such Person or group to acquire, directly or indirectly, beneficial ownership
of
the Business pursuant to a merger, consolidation or other business combination,
sale of shares of capital stock, sale of assets, tender offer or exchange offer
or similar transaction, including any single or multi-step transaction or series
of related transactions, in each case other than the Sale, any transaction
expressly permitted under Section 5.2 and any transaction involving a
combination with or acquisition of Seller and its Affiliates substantially
as a
whole (but, in such latter case, would preserve the rights and obligations
under
this Agreement).
(b) Solicitation
Period.
(i) Notwithstanding
Section 5.3(a), during the period beginning on the date of this Agreement and
continuing until 11:59 p.m., New York time, on the
date
that
is 14 days after the date of this Agreement (the “Solicitation
Period”),
Seller
and its Representatives shall have the right to directly or indirectly: (i)
initiate, solicit and encourage Acquisition Proposals from any Qualified
Purchaser relating to the purchase of the Business, including by way of
providing access to non-public information pursuant to one or more Conforming
Confidentiality Agreements; provided
that
Seller shall promptly provide or make available to Purchaser any material
non-public information concerning the Business, the Company or any Company
Subsidiary that is provided or made available to any Person given such access
that was not previously provided or made available to Purchaser; and (ii) enter
into and maintain discussions or negotiations with respect to Acquisition
Proposals or otherwise cooperate with or assist or participate in, or facilitate
any such discussions or negotiations. For purposes of this Agreement,
“Qualified
Purchaser”
means
any U.S. or foreign bank or bank holding company that is reasonably capable
of
entering into, within the Solicitation Period, a definitive agreement meeting
the terms of an Alternative Acquisition Agreement.
(ii) If
Seller
receives an Acquisition Proposal from any Qualified Purchaser prior to the
end
of the Solicitation Period that Seller concludes in good faith constitutes
a
Superior Proposal, Seller may at any time prior to the end of the Solicitation
Period enter into a definitive agreement with respect to such Superior Proposal,
except that such agreement must be conditioned upon Purchaser not exercising
its
rights set forth in clause (iii) below and, if such right is not exercised,
Purchaser receiving the payment of the Termination Fee pursuant to Section
8.1(f), and must provide for its automatic termination (without any cost,
liability or obligation to the Company, Purchaser or their respective
Subsidiaries) upon any such exercise (together with any related schedules,
exhibits or other documentation, the “Alternative
Acquisition Agreement”).
Promptly upon entering into an Alternative Acquisition Agreement (and in any
event within twenty-four hours thereof), Seller shall provide a true and
complete copy thereof to Purchaser. For purposes of this Agreement,
“Superior
Proposal”
means
any bona
fide Acquisition
Proposal made in writing that (x) is on terms that Seller determines in its
good faith judgment (after taking into account all legal, financial, regulatory
and other aspects of the proposal, including likelihood of consummation) is
superior from a financial point of view to this Agreement for the Seller’s
shareholders and (y) is for cash and is not subject to any financing
condition.
(iii) Upon
receipt by Purchaser of the Alternative Acquisition Agreement and for a period
of five Business Days thereafter (the “Matching
Period”),
Seller
shall, and shall cause its Representatives to, during the Matching Period,
negotiate with Purchaser in good faith (to the extent Purchaser desires to
negotiate) to make such adjustments in the terms and conditions of this
Agreement so that the Acquisition Proposal provided for in the Alternative
Acquisition Agreement ceases to constitute a Superior Proposal. In the event
that Purchaser agrees to make adjustments in the terms and conditions of this
Agreement such that Seller concludes that the Acquisition Proposal provided
for
in
the Alternative Acquisition Agreement no longer constitutes a Superior Proposal,
the Alternative Acquisition Agreement shall automatically terminate (without
any
cost, liability or obligation to the Company, Purchaser or their respective
Subsidiaries). In the event that Purchaser does not so agree during the Matching
Period, the Alternative Acquisition Agreement shall become final and binding
upon Seller upon the payment by Seller of the Termination Fee pursuant to
Section 8.1(f).
ARTICLE
VI
ADDITIONAL
AGREEMENTS
6.1. Regulatory
Matters.
(a) Each
of
Purchaser and Seller shall, and shall cause its Subsidiaries to, take, or cause
to be taken, all commercially reasonable actions necessary or advisable to
(i) comply promptly with all legal requirements which may be imposed on
such party or its relevant Subsidiaries with respect to the transactions
contemplated hereby, including in connection with obtaining any third-party
consent that may be required to be obtained in connection with the transactions
contemplated by this Agreement, and, subject to the conditions set forth in
Article VII hereof, to consummate the transactions contemplated hereby
(including, for purposes of this Section 6.1, required in order to continue
any
contract or agreement with Company or its Subsidiaries following Closing or
to
avoid any penalty or other fee under such contracts and agreements, in each
case
arising in connection with the transactions contemplated hereby) and
(ii) obtain (and cooperate with the other party to obtain) any consent,
authorization, order or approval of, or any exemption by, any Governmental
Entity which is required or advisable to be obtained by Seller or Purchaser,
respectively, or any of their respective Subsidiaries in connection with the
transactions contemplated by this Agreement (it being understood and agreed
that
it shall be deemed commercially reasonable for Purchaser to take all action
other than those that would not be required pursuant to the last sentence of
this Section 6.1(a)).
The
parties hereto shall cooperate with each other and promptly prepare and file
all
necessary documentation, and to effect all applications, notices, petitions
and
filings (including, if required, notification under the HSR Act), to obtain
as
promptly as practicable all permits, consents, approvals and authorizations
of
all third parties and Governmental Entities which are necessary or advisable
to
consummate the transactions contemplated by this Agreement. Purchaser and Seller
shall have the right to review in advance and, to the extent practicable, each
will consult the other on, in each case subject to applicable laws relating
to
confidentiality or the exchange of information, all the information relating
to
Seller, Company or Purchaser, as the case may be, and any of their respective
Subsidiaries, which appear in any filing made with, or written materials
submitted to, any third party or any Governmental Entity in connection with
the
transactions contemplated by this Agreement. In exercising the foregoing right,
each of the parties hereto shall act reasonably and as promptly as practicable.
The parties hereto agree that they will consult with each other with respect
to
the obtaining of all permits, consents, approvals and authorizations of all
third parties and Governmental Entities necessary or advisable to consummate
the
transactions contemplated by this Agreement and each party will keep the other
apprised of the status of matters relating to completion of the transactions
contemplated herein.
Each
of
Purchaser and Seller shall take all commercially reasonable actions to resolve
any objections that may be asserted by any Governmental Entity with respect
to
this Agreement or the transactions contemplated by this Agreement. Notwithstanding
the foregoing, nothing contained in this Agreement shall be deemed to require
Purchaser to take to any action, or commit to take any action, or agree to
any
condition or restrictions, in connection with obtaining the foregoing permits,
consents, approvals and authorizations of Governmental Entities or third parties
that would reasonably be expected to have a material adverse effect on the
business, results of operations or financial condition of the Business, the
Company or Purchaser (measured on a scale relative to the Business) following
the Effective Time (a “Materially
Burdensome Regulatory Condition”);
provided
that the
parties agree that any actions required to be taken by or conditions or
restrictions imposed on Purchaser in order to obtain such permits, consents,
approvals or authorizations of any Governmental Entity or third party shall
not
be considered a Materially Burdensome Regulatory Condition to the extent such
actions, conditions or restrictions relate to Purchaser’s compliance with the
conditions in Section 3(d)(2) of the BHCA or in the Bank Merger Act relating
to
the nationwide deposit cap and to any applicable state deposit
caps.
(b) Purchaser
and Seller shall, upon request, furnish each other with all information
concerning Purchaser, Seller, Company and their respective Subsidiaries,
directors, officers and shareholders and such other matters as may be reasonably
necessary in connection with any statement, filing, notice or application made
by or on behalf of Purchaser, Seller, Company or any of their respective
Subsidiaries to any Governmental Entity in connection with the transactions
contemplated by this Agreement.
(c) Purchaser
and Seller shall promptly advise each other upon receiving any communication
from any Governmental Entity or third party whose consent or approval is
required for consummation of the transactions contemplated by this Agreement
which causes such party to believe that there is a reasonable likelihood that
any Requisite Regulatory Approval or other consent or approval will not be
obtained or that the receipt of any such approval will be materially
delayed.
6.2. Access
to Information.
(a) Subject
to
the Confidentiality Agreement, Seller agrees to provide Purchaser and
Purchaser’s officers, directors, employees, accountants, counsel, financial
advisors, agents and other representatives (collectively, the “Purchaser
Representatives”),
from
time to time prior to the Closing Date or the termination of this Agreement,
such information as Purchaser shall reasonably request with respect to the
Business, the Company and the Company Subsidiaries and their respective
businesses, financial conditions and operations and such access to the
properties and personnel of the Business, the Company and the Company
Subsidiaries as Purchaser shall reasonably request, which access shall occur
during normal business hours and shall be conducted in such manner as not to
interfere unreasonably with the conduct of the Business. Except as required
by
law, Purchaser will hold, and will cause its officers, employees, accountants,
counsel, financial advisors and other representatives and Affiliates to hold,
any nonpublic information of Seller received from Seller or the Company,
directly or indirectly, in accordance with the Confidentiality
Agreement.
(b) Seller
and
Company shall not be required to provide access to or to disclose information
where such access or disclosure would violate or prejudice the rights of
customers, jeopardize the attorney-client or other legal privilege of the
institution in possession or control of such information or contravene any
law,
rule, regulation, order, judgment, decree, fiduciary duty or binding agreement
entered into prior to the date of this Agreement. The parties hereto will make
appropriate substitute disclosure arrangements under circumstances in which
the
restrictions of the preceding sentence apply.
6.3. Public
Disclosure.
Seller
and Purchaser shall consult with each other before issuing any press release
or
otherwise making any public statement or making any other public (or
non-confidential) disclosure (whether or not in response to an inquiry)
regarding the terms of this Agreement or any of the transactions contemplated
hereby, and neither shall issue any such press release or make any such
statement or disclosure without the prior approval of the other (which approval
shall not be unreasonably withheld or delayed), except as may be required by
law
or the rules of any market or exchange on which the shares of Seller or
Purchaser may be listed for trading, in which case the party proposing to issue
such press release or make such public statement or disclosure shall consult
with the other party before issuing such press release or making such public
statement or disclosure.
6.4. Employees;
Employee Benefit Matters.
(a) Following
the Closing Date, Purchaser shall maintain or cause to be maintained employee
benefit plans for the benefit of employees who are actively employed by the
Company and its Subsidiaries on the Closing Date (“Covered
Employees”)
which,
in the aggregate, are generally substantially comparable to those employee
benefit plans that are made available to similarly situated employees of
Purchaser or its Subsidiaries (other than the Company and its Subsidiaries),
as
applicable; provided, that in no event shall any Covered Employee be eligible
to
participate in any closed or frozen plan of Purchaser or its Subsidiaries;
provided, further, that until such time as Purchaser shall cause Covered
Employees to participate in the benefit plans that are made available to
similarly situated employees of Purchaser or its Subsidiaries (other than the
Company and its Subsidiaries), a Covered Employee’s continued participation in
employee benefit plans of the Company and its Subsidiaries shall be deemed
to
satisfy the foregoing provisions of this sentence (it being understood that
participation in the Purchaser plans may commence at different times with
respect to each Purchaser Plan).
(b) For
purposes of eligibility to participate, vesting and benefit accruals (except
benefit accrual under any final average pay defined benefit pension plan) under
the employee benefit plans of Purchaser and its Subsidiaries providing benefits
to any Covered Employees after the Closing Date (the “New
Plans”),
each
Covered Employee shall be credited with his or her years of service with the
Company and its Subsidiaries and their respective predecessors before the
Closing Date, to the same extent as such Covered Employee was entitled, before
the Closing Date, to credit for such service under any parallel Company Benefit
Plan in which such Covered Employee participated immediately prior to the
Closing Date; provided that the foregoing shall not apply to the extent that
its
application would result in a duplication of benefits with respect to the same
period of service or with respect to any closed or frozen plan. In addition,
for
purposes of each New Plan providing medical, dental, pharmaceutical and/or
vision benefits to any Covered Employee, Purchaser shall use reasonable
best
efforts to cause all pre-existing condition exclusions and actively-at-work
requirements of such New Plan to be waived for such employee and his or her
covered dependents, unless such conditions would not have been waived under
the
comparable Company Benefit Plan in which such employee participated immediately
prior to the Closing Date and Purchaser shall cause any eligible expenses
incurred by such employee and his or her covered dependents during the portion
of the plan year of the Company Benefit Plan ending on the date such employee’s
participation in the corresponding New Plan begins to be taken into account
under such New Plan for purposes of satisfying all deductible, coinsurance
and
maximum out-of-pocket requirements applicable to such employee and his or her
covered dependents for the applicable plan year as if such amounts had been
paid
in accordance with such New Plan.
(c) Prior
to
the Closing Date, Seller shall take all action necessary to ensure that
effective as of the Closing Date, (i) any employee or other service provider
who
is employed by the Company or its Subsidiaries as of immediately prior to the
Closing Date but who primarily provides services to or with respect to the
business of (A) an Excluded Business or (B) Seller or any of its Affiliates
other than the Company and its Subsidiaries (collectively, the “Excluded
Employees”)
is
transferred from the Company and its Subsidiaries without any liability to
the
Company or its Subsidiaries and (ii) any employee or other service provider
who
is employed by the Seller or its Subsidiaries (other than the Company or its
Subsidiaries) as of immediately prior to the Closing Date but who primarily
provides services to or with respect to the Business is transferred to the
Company or any of its Subsidiaries. From the date hereof through the Closing
Date, Seller will not make any employment transfers that would result in a
modification to whether a particular service provider is classified as primarily
providing services to the Business.
(d) Pursuant
to the terms of the Transition Services Agreement, the Company or Purchaser,
as
applicable, will, at Seller’s expense (and at cost), administer the payroll and
all HR administrative systems for Excluded Employees and all other employees
of
Seller and its Affiliates who are located in the United States or Canada and
who
participate in the employee benefit plans that are administered through the
Company’s and its Subsidiaries’ payrolls and HR administrative systems prior to
the Closing Date (collectively “Transitional
Participants”)
and
will, at Seller’s expense (and at cost), provide employee benefits coverage to
Transitional Participants (for Transitional Participants who are located in
Canada, only payroll and HR administrative systems services) that is consistent
with such coverage provided to Covered Employees under Section 6.4(a). Seller
shall use reasonable best efforts to ensure that the provision of such
transitional services ends on or promptly following the Closing Date, it being
understood that to the extent that such services continue following the Closing
Date, such services will terminate no later than the 60th
day
following the Closing Date and in no event shall any Transitional Participants
participate in any employee benefit plans of the Company and its Subsidiaries
following the Closing Date other than health and welfare plans. Prior to the
Closing Date, Seller shall take all actions necessary, including the adoption
of
plan amendments to ensure that effective as of the Closing Date, the
participation of (i) the Excluded Employees and (ii) any former employees or
service providers who would be Excluded Employees but for the fact that their
employment or services were previously terminated (the “Former
Excluded Employees”)
in any
Company-Only Plans terminates and all liabilities under such Plans in respect
of
the Excluded Employees and the Former Excluded Employees shall be transferred
to, and be the sole responsibility of, Seller and its Affiliates (other than
the
Company and its
Subsidiaries);
provided that this sentence shall not apply to (i) participation in respect
of
benefits accrued by Excluded Employees or Former Excluded Employees in
Company-Only Plans that are “qualified” under Section 401 of the Code and (ii)
liabilities under Company-Only Plans that are healthcare plans incurred by
Excluded Employees prior to the Closing Date to the extent fully accrued on
the
Closing Balance Sheet. For purposes of clause (ii) a medical, dental, vision
and/or prescription drug benefit shall be considered incurred on the date when
the services are rendered, the supplies are provided or medication is
prescribed, and not when the condition arose.
(e) For
purposes of determining cash severance payments under the Buyer severance plan
applicable to Covered Employees whose employment terminates prior to the first
anniversary of the Closing Date, the cash severance payments payable to such
Covered Employees shall be determined in accordance with the applicable cash
severance formula used under the severance plan applicable to the Company or
the
Subsidiary employing such Covered Employee immediately prior to the Closing
Date
(which Company or Subsidiary severance plan is set forth on Section 3.11(a)
of
the Disclosure Schedules and a copy of which has been provided to
Buyer).
(f) Prior
to
the Closing Date, the parties will mutually develop and agree to the performance
criteria to replace Company ROEC (return on economic capital) currently used
to
measure payment entitlement under the Company’s Long Term Incentive Plan. Such
replacement criteria shall preserve, to the extent possible, the degree of
incentive currently inhering in open performance periods under the current
practices of such plan. The Seller will use good faith efforts to cause
outstanding equity-based awards held by Covered Employees to fully vest on
the
Closing Date.
(g) Nothing
in
this Section 6.4 shall be construed to limit the right of Purchaser or any
of
its Subsidiaries (including, following the Closing Date, the Company and its
Subsidiaries) to amend or terminate any Company Benefit Plan or other employee
benefit plan, to the extent such amendment or termination is permitted by the
terms of the applicable plan, nor shall anything in this Section 6.4 be
construed to require the Purchaser or any of its Subsidiaries (including,
following the Closing Date, the Company and its Subsidiaries) to retain the
employment of any particular Covered Employee for any fixed period of time
following the Closing Date.
(h) Without
limiting the generality of Section 10.9, the provisions of this Section 6.4
are
solely for the benefit of the parties to this Agreement, and no current or
former employee, director or independent contractor or any other individual
associated therewith shall be regarded for any purpose as a third-party
beneficiary of the Agreement, and nothing herein shall be construed as an
amendment to any Company Benefit Plan or other employee benefit plan for any
purpose.
6.5. Nonsolicit
of Employees.
Seller
agrees that, commencing as of the date of this Agreement until the first
anniversary of the Closing Date,
without
the prior written consent of Purchaser, neither Seller nor any of its
Affiliates will (or
will
assist or encourage others to), directly
or indirectly, solicit to hire (or
cause
or seek to cause to leave the employ of the Company or any Company Subsidiary
or
any of their successors) any
officer or
employee
of the
Company
or
any Company Subsidiary as of the Closing Date;
provided
that
Seller and its Affiliates shall not be in breach of this provision where an
employee
is
solicited by way of any general solicitation or advertisement not targeted
at
employees
of the
Company, the Company Subsidiaries or the Business; provided,
however,
that
notwithstanding the foregoing, in no event during such three-year period shall
Seller or any of its Affiliates hire any Key Employee unless such person has
not
been an employee of the Company or its Affiliates for at least six
months.
As used
herein, “Key
Employee”
means
any executive
officer of the Company, any of the Company’s department heads.
6.6. Additional
Agreements.
In case
at any time after the Closing Date any further action is necessary or desirable
to carry out the purposes of this Agreement, the proper officers and directors
of each party to this Agreement and their respective Subsidiaries shall take
all
such necessary action as may be reasonably requested by, and at the sole expense
of, the requesting party.
6.7. Transition
Services Agreement.
At
the request of Purchaser or Seller, the parties will cooperate, including by
entering into a customary transition services agreement, with respect to Seller
or its applicable Affiliates providing or causing to be provided to the Company
and its Subsidiaries or the Company and its Subsidiaries providing or causing
to
be provided to Seller and its Affiliates (other than the Company and its
Subsidiaries) such transitional services for a transition period of 12-18 months
as may be reasonable under the circumstances (other than payroll, employee
benefit or other HR administrative services which shall be governed by the
provisions of Section 6.4(d)). Such services will be provided in a manner
consistent with past practice and on commercially reasonable pricing terms;
any
incremental out-of-pocket costs or expenses of the party providing such services
shall be borne by the party receiving the services.
6.8. Additional
Agreements Regarding Tax Matters.
(a) Preparation
and Filing of Tax Returns.
(i) Purchaser
will be responsible for preparing and filing (or causing the preparation and
filing of) all Tax Returns required to be filed after the Closing. In the case
of returns due for Pre-Closing Periods and Interim Periods, Seller agrees to
cooperate with Purchaser, in accordance with Purchaser’s reasonable requests, in
the preparation and filing of such Tax Returns. Purchaser shall deliver drafts
of any Income Tax Returns for any Pre-Closing Period and any Interim Period,
to
the extent such Tax Returns reflect a liability for Covered Taxes, together
with
supporting factual information and workpapers to Seller no later than 30 days
before the statutory deadlines for filing the applicable Tax Return (as
extended).
(ii) Subject
to
the provisions of this Agreement, all decisions relating to the preparation
of
Tax Returns shall be made in the sole discretion of Purchaser.
(b) Payment
of Taxes.
From and
after the Closing Date:
(i) Purchaser
will pay or cause to be paid all Taxes with respect to Tax Returns which
Purchaser is obligated to prepare and file or cause to be prepared and filed
pursuant to Section 6.8(a); provided,
however,
that
Seller hereby assumes and
agrees
to
pay directly to or at the direction of Purchaser, at least three days prior
to
the date payment (including estimated payment) thereof is due, the amount,
if
any, of Covered Taxes reflected in such Tax Return.
(c) Seller’s
Contest Rights Regarding Taxes.
Notwithstanding any other provision of this Agreement to the contrary, Seller
shall have the right (but not the obligation) to control, defend, settle,
compromise or prosecute in any manner any audit, examination, investigation,
hearing or other proceeding (collectively, “Tax
Proceeding”)
with
respect to any Tax Return of the Company and its Subsidiaries involving solely
any Excluded Business or the Specified Transfers; provided,
however,
Seller,
without the consent of Purchaser (which consent will not be unreasonably
withheld or delayed), shall not settle, compromise or abandon any Tax Proceeding
with respect to any Excluded Business or the Specified Transfers if such action
would reasonably be expected to materially adversely affect the Purchaser,
its
Affiliates, or, following the Closing Date, the Company or its Subsidiaries.
In
addition, (i) Seller shall keep Purchaser duly informed of any such Tax
Proceedings relating to any Excluded Business or the Specified Transfers and
(ii) Purchaser shall be entitled to receive copies of all correspondence
and documents relating to such Tax Proceedings (other than any confidential
or
proprietary information pertaining to Seller or any Excluded Business). If
the
Seller elects, in its sole discretion, not to control and conduct any such
Tax
Proceeding, the Seller shall, within 30 days of receipt of a written notice
of
the assertion of any tax claim, notify the Purchaser in writing of its intention
not to control and conduct the Tax Proceeding in connection with such tax claim.
In such event, the Purchaser may control, or cause its designee to control,
and
conduct such Tax Proceedings in such manner as it may deem
appropriate.
(d) Purchaser’s
Contest Rights Regarding Taxes.
Except
as expressly provided otherwise in Section 6.8(c), Purchaser shall have the
sole
right (but not the obligation) to control, defend, settle, compromise, or
prosecute in any manner a Tax Proceeding with respect to any Tax Return of
the
Company and its Subsidiaries; provided,
however,
Purchaser, without the consent of Seller (which consent will not be unreasonably
withheld or delayed), shall not settle, compromise or abandon any Tax Proceeding
that could reasonably be expected to give rise to a material claim by Purchaser
for indemnification under Section 9.4(a). In addition, (i) Purchaser shall
keep Seller duly informed of any Tax Proceeding related to any Excluded Business
or the Specified Transfers and (ii) Seller shall be entitled to receive
copies of all correspondence and documents relating to such Tax Proceeding
(but,
for these purposes, excluding access to any financial and other confidential
or
proprietary information pertaining to any member of Purchaser’s consolidated
group other than Company and its Subsidiaries).
(e) Tax
Sharing Agreements.
On the
Closing Date, all Tax sharing agreements and arrangements between (a) any of
the
Company and its Subsidiaries, on the one hand, and (b) Seller or any of its
Affiliates (other than any of the Company and its Subsidiaries), on the other
hand, will be terminated and have no further effect for any taxable year or
period (whether a past, present or future year or period), and except as
provided in Section 6.12(a) no additional payments will be made thereunder
on or
after the Closing Date in respect of a redetermination of Tax liabilities or
otherwise.
(f) Notification
Requirements.
Purchaser shall, and shall cause Company to, promptly (but in all events within
20 Business Days of receipt thereof) forward to Seller all
written
notifications and other written communications from any Tax authority received
by Purchaser or the Company relating to any Excluded Business or the Specified
Transfers, and, subject to the provisions of Section 6.8(c), Purchaser shall,
and shall cause Company to, take such reasonable actions as requested by Seller
to enable Seller to take any action Seller deems appropriate with respect to
any
proceedings relating thereto.
(g) Cooperation.
Purchaser, Seller and Company shall each at their own expense cooperate with
each other and make available to each other such Tax data and other information
as may be reasonably required in connection with (i) the preparation or
filing of any Tax Return, election, consent or certification, or any claim
for
refund, (ii) any determinations of liability for Taxes, or (iii) any
Tax Proceeding (“Tax
Data”).
Such
cooperation shall include, without limitation, making their respective employees
and independent auditors reasonably available on a mutually convenient basis
for
all reasonable purposes, including, without limitation, to sign Tax forms and
consents, to provide explanations and background information and to permit
the
copying of books, records, schedules, workpapers, notices, revenue agent
reports, settlement or closing agreements and other documents containing the
Tax
Data (“Tax
Documentation”).
The
Tax Data and the Tax Documentation shall be retained until one year after the
expiration of all applicable statutes of limitations (including extensions
thereof); provided,
however,
that in
the event an audit, examination, investigation or other proceeding has been
instituted prior to the expiration of an applicable statute of limitations,
the
Tax Data and Tax Documentation relating thereto shall be retained until there
is
a final determination thereof (and the time for any appeal has
expired).
(h) Carryforwards
and Carrybacks; Amended Returns.
Purchaser will cause each of the Company and its Subsidiaries to elect, where
permitted by law, to carry forward any net operating loss, net capital loss,
charitable contribution or other item arising after the Closing Date that could,
in the absence of such an election, be carried back to a taxable period of
any
of the Company and its Subsidiaries ending on or before the Closing Date. To
the
extent such action could reasonably be expected to adversely affect Seller’s
liability under Section 9.4(a), neither Purchaser, the Company nor any of its
Subsidiaries shall amend, or take any similar action with respect to any Tax
Return filed for any Pre-Closing Period or Interim Period without the prior
written consent of the Seller (which consent shall not be unreasonably withheld
or delayed).
(i) Refunds.
Except
as otherwise provided in the following sentence, Seller will be entitled to
retain, or receive prompt payment from Purchaser or any of its Affiliates
(including Company and its Subsidiaries) of any refund or credit of Covered
Taxes actually received by Purchaser. Provided Purchaser complies with its
obligation under Section 6.8(h), Purchaser will be entitled to retain or receive
any refund or credit of Taxes of the Company and its Subsidiaries attributable
to the carryback of any Tax attribute arising in a taxable period that begins
after the Closing Date to a taxable period that ends on or before the Closing
Date. Purchaser and the Company and its Subsidiaries will be entitled to retain,
or receive prompt payment from Seller of, any refund or credit with respect
to
Taxes of the Company and its Subsidiaries other than Covered Taxes. The amount
of any refund or credit that Purchaser or Seller is entitled to retain or
receive pursuant to this Section 6.8(i) shall be reduced to take account of
any
Taxes incurred upon the receipt of such refund or credit. All payments required
to
be made
pursuant to this Section 6.8(i) shall be made within thirty days after receipt
or entitlement to the refund or credit by Seller, Purchaser, the Company or
its
Subsidiaries.
(j) Transfer
Taxes.
All
applicable sales and transfer Taxes and filing, recording, registration, stamp,
documentary and other similar Taxes and fees imposed on the purchase and sale
of
the Company Common Stock pursuant to this Agreement will be shared equally
between Seller and Purchaser. The parties shall cooperate in the preparation
and
filing of all Tax Returns relating to such transfer taxes.
6.9. Post-Closing
Confidentiality.
(a) Following
the Closing, the confidentiality obligations of Purchaser under the
Confidentiality Agreement with respect to information relating to the Company,
the Company Subsidiaries and the Business shall terminate.
(b) Following
the Closing, Seller shall, and shall cause its Affiliates and its and their
officers, directors, employees, consultants, agents and advisors to, keep
confidential and not use for its benefit or for the benefit of any other Person,
any and all Company Confidential Information.
Notwithstanding the foregoing, if Seller or its Affiliates or any of their
respective officers, directors, employees, consultants, agents or advisors
(collectively, “Disclosing
Party”)
is
requested or required (by oral questions, interrogatories, requests for
information or documents, subpoena, civil investigative demand or similar
process) to disclose any such information, the Disclosing Party will provide
Purchaser with notice of such request or requirement as promptly as practicable
(unless not permitted by applicable law) so that such Purchaser may seek a
protective order or other appropriate remedy and/or waive compliance with the
foregoing provisions of this Agreement. The Disclosing Party will cooperate
reasonably with Purchaser in connection with Purchaser’s efforts to seek such an
order or remedy. If Purchaser does not obtain such protective order or other
remedy, or Purchaser waives the Disclosing Party’s compliance with the
provisions of this Section 6.9, the Disclosing Party will furnish only that
portion of the applicable confidential information that is legally required,
and
will exercise reasonable efforts to obtain assurance that confidential treatment
will be accorded such disclosed information.
(c) Notwithstanding
the foregoing, the Company Confidential Information shall not include
information that (i) is or becomes generally available to the public other
than
as a result of a disclosure by Seller or any of its Affiliates or such other
Persons in breach of this Agreement, or (ii) becomes available to Seller after
the Closing Date on a non-confidential basis from a source other than the
Company or a Company Subsidiary; provided
that such
source is not, after reasonable inquiry, known to be bound by a confidentiality
agreement or other contractual, legal or fiduciary obligation with respect
to
such information.
(d) Seller
acknowledges and agrees that due to the unique nature of the Company
Confidential Information, there can be no adequate remedy at law for any breach
of its obligations hereunder, that any such breach or threatened breach may
allow Seller, its Affiliates or third parties to unfairly compete with the
Purchaser or its Affiliates, resulting in irreparable harm to Purchaser and
its
Affiliates, and therefore, that upon any such breach or any threat thereof,
Purchaser will be entitled to appropriate equitable and injunctive relief from
a
court of
competent
jurisdiction without the necessity of proving actual loss, in addition to
whatever remedies either of them might have at law or equity.
6.10. Cooperation.
Following the Closing, each party agrees to cooperate in good faith to provide
information to the other party that is reasonably necessary in connection with
regulatory, legal, accounting and similar matters of Seller and its Affiliates
on the one hand and Company and its Affiliates on the other (and not relating
to
any dispute, litigation or arbitration between the parties hereto or their
Affiliates). The parties agree that any information provided pursuant to
this provision shall be kept confidential and shall not be used for any purpose
except for the reason given in the request.
6.11. Use
of
Name.
(a) As
soon as
practicable and in any event no later than 30 days after the Closing Date,
Purchaser shall cause the Company and the Company Subsidiaries to file
amendments to their certificates of incorporation, articles of association
or
other organizational documents with the applicable Governmental Entities
changing the names of the Company and the Company Subsidiaries to names that
do
not include the words “ABN AMRO” or any name confusingly or misleadingly similar
thereto. For the avoidance of doubt, Purchaser and its Affiliates (including
after the Closing, the Company and its Subsidiaries) may use the name “ABN AMRO”
and all other trademarks or tradenames owned or licensed by Seller or its
Affiliates (excluding the Company and its Subsidiaries) and used in connection
with the Business, the Company or any Company Subsidiary as of the Closing
on
any materials distributed or available to customers until the earlier of (i)
six
months after the Closing Date and (ii) the exhaustion of inventory in existence
as of the Closing Date, subject to applicable law, in each case, in a mutually
agreed transitional manner (it being understood and agreed that the Company
and
its Subsidiaries shall not actively market using such trademarks and
tradenames). Thereafter, Purchaser shall not, and shall cause the Company and
its Subsidiaries not to, use such trademarks or tradenames, other than (i)
in a
neutral, non-trademark sense to discuss the history of the Business, the Company
or the Company Subsidiaries or (ii) as required by applicable law.
(b) For
the
avoidance of doubt, from and after the Closing Date, Seller and its Subsidiaries
shall cease using and shall have no right in, to and under the name “LaSalle”
and any other Intellectual Property exclusively used by the Business. The
parties agree that any and all such rights shall be rights of the Company and
its Subsidiaries from and after the Closing Date. The parties agree to cooperate
and discuss in good faith appropriate arrangements relating to the shared use,
after Closing, of any Intellectual Property that is currently used by both
the
Company and its Subsidiaries, on the one hand, and by Seller or its other
Affiliates, on the other hand (such arrangements to be on terms consistent
with
past practice).
6.12. Settlement
of Intercompany Accounts; Termination of Intercompany Agreements; Conversion
of
Certain Company Debt into Equity; Funding Subsidiaries.
(a) Prior
to
the Closing, Seller shall cause $6.148 billion of intercompany debt owed by
the
Company to Seller and/or any of its Affiliates (other than the Company and
its
Subsidiaries) to be converted into Company Common Stock (and Seller shall be
entitled to take
necessary
actions in connection therewith, including amending its Certificate of
Incorporation), which shall be part of the shares of Company Common Stock to
be
purchased by Purchaser pursuant to Article II.
(b) Between
the date hereof and Closing, Seller and Purchaser shall discuss in good faith
and implement appropriate arrangements, on mutually acceptable terms, to effect
the repayment in full at Closing of all other intercompany debt owed by the
Company and/or its Subsidiaries to Seller and/or any of its Affiliates (other
than the Company and its Subsidiaries) as of the Closing; provided
that if
requested by Purchaser, Seller shall agree to delay the repayment date of all
or
a portion of such debt for a reasonable period of time not to exceed 180 days
following the Closing Date (it being understood and agreed that interest and
other payments thereunder shall continue to accrue and be payable in accordance
with the terms thereof during such delay period).
(c) Between
the date hereof and Closing, Seller and Purchaser shall (i) cooperate with
one
another to identify all derivative contracts outstanding between Seller and/or
any of its Affiliates (other than the Company and its Subsidiaries), on the
one
hand, and the Company and/or its Subsidiaries, on the other hand, and (ii)
discuss in good faith and implement appropriate arrangements, on mutually
acceptable terms, to unwind such derivative contracts at Closing, including
any
cash settlement associated with “mark to market” in connection therewith. In
addition, to the extent Seller and its Affiliates (other than the Company and
its Subsidiaries) are party to a “back to back” derivative contract with third
parties with respect to any such derivative contract, at Purchaser’s request,
Seller shall use commercially reasonable efforts to assign, or cause to be
assigned, such “back to back” derivative contract to the Company.
(d) Seller
and
Purchaser shall cooperate in good faith to effect the transfer to the Company
or
a Subsidiary thereof on mutually acceptable terms immediately prior to the
Closing, and as it relates to the portion owned by the Business, without any
net
economic impact on the Company and without triggering any gain or loss to the
Company or its Subsidiaries, the ownership interest in the real estate located
at 135 South LaSalle, Chicago and at 540 West Madison, Chicago (The Plaza)
currently held by Seller and/or any of its Affiliates (other than the Company
and its Subsidiaries).
(e) On
or
prior to the Closing Date and effective immediately prior to the Closing, all
other intercompany accounts between Seller and/or any of its Affiliates (other
than the Company and its Subsidiaries), on the one hand, and the Company and/or
its Subsidiaries, on the other hand, including intercompany accounts arising
by
reason of any tax sharing agreement, shall be settled. Intercompany accounts
solely between and among the Company and its Subsidiaries (other than any
Excluded Business) shall not be affected by this provision. Seller shall provide
to Purchaser on the date hereof the details of the intercompany subordinated
notes between Seller and/or any of its Affiliates (other than the Company and
its Subsidiaries), on the one hand, and the Company and/or its Subsidiaries,
on
the other hand. No later than two weeks from the date hereof, Seller shall
provide to Purchaser the details of all other material intercompany accounts
as
of the date hereof between Seller and/or any of its Affiliates (other than
the
Company and its Subsidiaries), on the one hand, and the Company and/or its
Subsidiaries, on the other hand.
(f) Effective
immediately prior to the Closing, all other contracts, agreements and
arrangements, including all obligations to provide goods, services or other
benefits, between Seller and/or any of its Subsidiaries (other than the Company
and its Subsidiaries), on the one hand, and the Company and/or its Subsidiaries,
on the other hand, shall be terminated without any party having any continuing
obligation to the other, except for (i) this Agreement and (ii) any Transition
Services Agreement.
(g) Seller
and
Purchaser shall cooperate with one another between the date hereof and Closing
(i) to identify any Funding Subsidiaries of Seller whose purpose is to provide
capital to the Company and its Subsidiaries and to discuss in good faith and
implement appropriate arrangements, on mutually acceptable terms, to transfer
such Funding Subsidiaries to the Company at Closing and (ii) to identify any
Funding Subsidiaries of the Company whose purpose is to provide capital to
the
Seller and/or any of its Affiliates (other than the Company and its
Subsidiaries) and to discuss in good faith and implement appropriate
arrangements, on mutually acceptable terms, to transfer such Funding
Subsidiaries to Seller or an Affiliate thereof (other than the Company and
its
Subsidiaries) at Closing. “Funding
Subsidiary”
means,
with respect to an entity, a direct or indirect special purpose Subsidiary
of
that entity that issues securities for capital purposes or an entity relating
to
that capital structure.
(h) Seller
shall take any actions as may be necessary to ensure that any shares of
preferred stock issued by the Company or its Subsidiaries outstanding as of
the
Closing Date shall have no voting rights for a director or otherwise (except
for
customary protective rights in the applicable certificate of designations
relating to dividend arrearages or adverse changes in the terms to the preferred
stock) and shall not become entitled to vote or consent by reason of the
consummation of the transactions contemplated hereby. In connection with the
foregoing, notwithstanding anything herein to the contrary, Seller shall be
permitted to cause the Company to refinance, redeem or defease all or a portion
of such preferred stock, amend the terms of such preferred stock (including
any
agreements on instruments relating thereto) or take such other actions as are
necessary or advisable; provided
that (i)
Seller shall hold the Company harmless for the effects of any less favorable
economic terms of any such refinancing and (ii) any such refinancing shall
be
prepayable or redeemable at the option of the issuer within 90 days of Closing
without penalty
6.13. Specified
Transfers.
Prior to
the Closing, Seller shall effectuate the distribution of ABN AMRO WCS Holding
Company by the Company to Seller or an Affiliate thereof (other than the Company
and its Subsidiaries) (the “Specified
Transfers”).
At the
time of the distribution, ABN AMRO WCS Holding Company will directly or
indirectly hold the remainder of the Excluded Business.
6.14. No
Additional Representations.
Purchaser acknowledges that neither Seller nor any of its Affiliates is making
any representation or warranty, express or implied, as to any financial or
other
matter with respect to Seller, Company or their respective Subsidiaries, except
for the representations and warranties expressly set forth in Article III.
Seller acknowledges that neither Purchaser nor any of its Affiliates is making
any representation or warranty, express or implied, as to any financial or
other
matter with respect to Purchaser or its Subsidiaries, except for the
representations and warranties expressly set forth in Article IV.
6.15. Director
and Officer Indemnification.
(a) Purchaser
shall cause Company to indemnify, defend and hold harmless, the present and
former officers and directors of Company and each of Company’s Subsidiaries in
their capacities as such (each a “Company
Indemnified Party”)
in
accordance with the Certificate of Incorporation and bylaws, or other charter
documents, of Company and the respective Company Subsidiaries and any agreements
or plans maintained by Company and the respective Company Subsidiary, to the
fullest extent permitted thereunder and not prohibited by law after the Closing
Date against all losses, expenses, claims, damages and liabilities arising
out
of actions or omissions occurring on or prior to the Closing Date (other than
the transactions contemplated hereby, and other than any liability arising
directly or indirectly out of the pending investigation of Seller and its
Subsidiaries by the U.S. Department of Justice or any U.S. Attorney’s Office,
which liabilities shall be retained by Seller); provided
that in
no event shall a “Company Indemnified Party” include any Person who is or was
employed or retained primarily by Seller or an Affiliate of Seller (other than
Company and its Subsidiaries) and not primarily employed or retained by Company
or its Subsidiaries, and Seller agrees that it shall indemnify, defend and
hold
harmless such individuals to the same extent that Purchaser is agreeing with
respect to the Company Indemnified Parties.
(b) In
the
event following the Closing Purchaser or any of its successors or assigns or
Company or any of its successors or assigns (i) consolidates with or merges
into
any other person and shall not be the continuing or surviving corporation or
entity of such consolidation or merger or (ii) transfers or conveys all or
substantially all of its properties and assets to any person, then, and in
each
such case, to the extent necessary, proper provision shall be made so that
the
successors and assigns of Purchaser or Company, as applicable, assume the
obligations set forth in this section.
(c) The
provisions of this Section 6.15
are
intended to be for the benefit of, and shall be enforceable by, each Company
Indemnified Party and his or her heirs and representatives.
ARTICLE
VII
CONDITIONS
PRECEDENT
7.1. Conditions
to Each Party’s Obligation to Effect the Closing.
The
respective obligation of each party to effect the Closing shall be subject
to
the satisfaction at or prior to the Closing Date of the following
conditions:
(a) Regulatory
Approvals.
All
Requisite Regulatory Approvals shall have been obtained and shall remain in
full
force and effect or, in the case of waiting periods, shall have expired or
been
terminated (and, in the case of the obligation of Purchaser to effect the
Closing, no such Requisite Regulatory Approval shall have resulted in the
imposition of any Materially Burdensome Regulatory Condition).“Requisite
Regulatory Approvals” shall
mean
the approvals of (i) the Federal Reserve Board and (ii) any approvals, if
required, under the HSR Act.
(b) No
Injunctions or Restraints.
No
order, injunction, decree or judgment issued by any Governmental Entity or
other
legal restraint or prohibition preventing the consummation of the transactions
contemplated by this Agreement shall be in effect. No Governmental Entity shall
have taken any action set forth in Exhibit A.
7.2. Conditions
to Obligations of Purchaser.
The
obligation of Purchaser to effect the Closing is also subject to the
satisfaction or waiver by Purchaser at or prior to the Closing Date of the
following conditions:
(a) Representations
and Warranties.
(i) The representations and warranties of Seller set forth in Section
3.2
(Capitalization) and Section 3.3(a)
(Authority; No Violation) shall be true and correct in all material respects;
and (ii) the other representations and warranties of Seller set forth in
this Agreement shall be true and correct in all respects (disregarding for
such
purpose any limitation or qualification as to materiality or Material Adverse
Effect set forth therein), in each of cases (i) and (ii), as of the date of
this
Agreement and as of the Closing Date as though made on the Closing Date (except
to the extent that any such representations and warranties are, by their terms,
expressly limited to a specific date, in which case as of such specific date);
provided
that the
condition set forth in clause (ii) of this Section 7.2(a) shall be deemed
satisfied if the failure of all such representations and warranties to be so
true and correct (disregarding for such purpose any limitation or qualification
as to materiality or Material Adverse Effect set forth therein) would not
reasonably be expected to, individually or in the aggregate, have a Material
Adverse Effect.
(b) Performance
of Obligations of Seller.
Seller
shall have performed in all material respects all obligations required to be
performed by it under this Agreement at or prior to the Closing Date.
(c) Officer’s
Certificate.
Purchaser shall have received a certificate signed on behalf of Seller by its
Chief Executive Officer or Chief Financial Officer stating that the conditions
specified in Section 7.2(a) and Section 7.2(b) have been satisfied.
(d) FIRPTA
Certificate.
Seller
shall deliver a certificate from the Company that complies with Treasury
Regulation Sections 1.1445-2(c)(3) and 1.897-2(h), dated no more than 30 days
prior to the Closing Date and executed by a responsible corporate officer of
the
Company, to the effect that no interest in the Company is a “United States real
property interest” (as defined in Section 897(c)(1) of the Code).
(e) Specified
Transfers.
The
Specified Transfers shall have been completed.
7.3. Conditions
to Obligations of Seller.
The
obligation of Seller
to
effect the Closing is also subject to the satisfaction or waiver by Seller
at or
prior to the Closing Date of the following conditions:
(a) Representations
and Warranties.
The
representations and warranties of Purchaser set forth in Article IV of this
Agreement shall be true and correct in all respects (disregarding for such
purpose any limitation or qualification as to materiality or Purchaser Material
Adverse Effect set forth therein) as of the date of this Agreement and as of
the
Closing Date as though made on the Closing Date (except to the extent that
any
such representations and
warranties
are, by their terms, expressly limited to a specific date, in which case as
of
such specific date); provided
that the
condition set forth in this Section 7.3(a) shall be deemed satisfied if the
failure of all such representations and warranties to be so true and correct
(disregarding for such purpose any limitation or qualification as to materiality
or Purchaser Material Adverse Effect set forth therein) would not reasonably
be
expected to, individually or in the aggregate, have a Purchaser Material Adverse
Effect.
(b) Performance
of Obligations of Purchaser.
Purchaser shall have performed in all material respects all obligations required
to be performed by it under this Agreement at or prior to the Closing Date.
(c) Officer’s
Certificate.
Seller
shall have received a certificate signed on behalf of Purchaser by its Chief
Executive Officer or Chief Financial Officer stating that the conditions
specified in Section 7.3(a) and Section 7.3(b) have been satisfied.
ARTICLE
VIII
TERMINATION
AND AMENDMENT
8.1. Termination.
This
Agreement may be terminated at any time prior to the Closing Date:
(a) by
mutual
written consent of Seller and Purchaser;
(b) by
either
Seller or Purchaser, if the Closing shall not have occurred on or before May
1,
2008 (the “Termination Date”) (provided
that the
right to terminate this Agreement under this Section 8.1(b)
shall not
be available to any party whose action or failure to act has been the cause
of
or resulted in the failure of the Closing to occur on or before such date and
such action or failure to act constitutes a breach of this
Agreement);
(c) by
either
Seller or Purchaser, if any Requisite Regulatory Approval required to be
obtained pursuant to Section 7.1(a)
has been
denied by the relevant Governmental Entity and such denial has become final
and
nonappealable or any Governmental Entity of competent jurisdiction shall have
issued a final, nonappealable injunction permanently enjoining or otherwise
prohibiting the consummation of the transactions contemplated by this Agreement;
(d) by
Seller,
if Purchaser has breached or is in breach of any representation, warranty,
covenant or agreement on the part of Purchaser contained in this Agreement
in
any respect (disregarding for such purpose any limitation or qualification
as to
materiality or Purchaser Material Adverse Effect), which breach would,
individually or together with all such other then uncured breaches by Purchaser,
constitute grounds for the condition set forth in Section 7.3(a)
or
7.3(b)
not to be
satisfied at the Closing Date and Purchaser does not promptly use all
commercially reasonable efforts to cure such breach after written notice thereof
to Purchaser or such breach would not reasonably be expected to be covered
prior
to the Termination Date;
(e) by
Purchaser, if Seller has breached or is in breach of any representation,
warranty, covenant or agreement on the part of Seller contained in this
Agreement in any respect (disregarding for such purpose any limitation or
qualification as to materiality or Material Adverse Effect), which breach would,
individually or together with all such other then uncured breaches by Seller,
constitute grounds for the condition set forth in Section 7.2(a)
or
7.2(b)
not to be
satisfied at the Closing Date and Seller does not promptly use all commercially
reasonable efforts to cure such breach after written notice thereof to Seller
or
such breach would not reasonably be expected to be cured prior to the
Termination Date; or
(f) by
Seller,
at the end of the Matching Period set forth in Section 5.3(b)(iii) if the
Alternative Acquisition Agreement has not terminated in accordance with Section
5.3 and has not otherwise terminated; provided
that the
Seller shall, simultaneously with such termination, pay the Termination Fee
to
Purchaser. “Termination
Fee”
means
an
amount in cash equal to U.S.$200,000,000 (two hundred million dollars), which
shall be paid (when due and owing) by wire transfer of immediately available
funds denominated in U.S. dollars to the account or accounts designated by
the
recipient. Seller acknowledges that the agreement to pay the Termination Fee
in
the circumstances set forth in this Section 8.1(f) is an integral part of the
transactions contemplated by this Agreement and that, without this Agreement,
Purchaser would not enter into this Agreement; accordingly, if Seller fails
to
pay when due the Termination Fee, Purchaser shall be entitled to interest on
the
Termination Fee at a rate per annum equal to the Prime Rate as published in
the
Wall
Street Journal,
Eastern
Edition, in effect from time to time during the period from the date that the
such payment was required to be made pursuant to this Agreement to the date
of
payment.
8.2. Effect
of Termination.
In the
event of termination of this Agreement pursuant to this Article VIII, no party
to this Agreement shall have any liability or further obligation hereunder
to
the other party hereto, except that (i) the last sentence of
Section 6.2(a)
(Access
to Information), and Section 6.3
(Public
Disclosure), Section 8.1 (Termination), Section 8.2
(Effect
of Termination), Section 10.1
(Expenses), Section 10.2
(Notices)
and Section 10.6
(Governing Law) shall survive any termination of this Agreement and
(ii) notwithstanding anything to the contrary in this Agreement,
termination will not relieve a breaching party from liability for any willful
and material breach of any provision of this Agreement.
8.3. Amendment.
Subject
to compliance with applicable law, this Agreement may be amended by the parties
hereto. This Agreement may not be amended except by an instrument in writing
signed on behalf of each of the parties hereto.
8.4. Extension;
Waiver.
At any
time prior to the Closing Date, the parties hereto may, to the extent legally
allowed, (a) extend the time for the performance of any of the obligations
or other acts of the other parties hereto, (b) waive any inaccuracies in
the representations and warranties contained herein or in any document delivered
pursuant hereto and (c) waive compliance with any of the agreements or
conditions contained herein. Any agreement on the part of a party hereto to
any
such extension or waiver shall be valid only if set forth in a written
instrument signed on behalf of such party, but such extension or waiver or
failure to insist on strict compliance with an obligation, covenant, agreement
or condition shall not operate as a waiver of, or estoppel with respect to,
any
subsequent or other failure.
ARTICLE
IX
INDEMNIFICATION
9.1. No
Survival of Representations, Warranties and Covenants.
None of
the representations and warranties of Seller and Purchaser contained in this
Agreement, and none of the covenants of Seller in Section 5.1, shall survive
the
Closing. For the avoidance of doubt, after Closing neither party shall be
entitled to initiate or continue any action, claim or litigation relating to
any
representation, warranty or covenant that did not survive the Closing and waives
all rights in respect thereof.
9.2. Indemnification
by Seller.
Subject
to the remaining provisions of this Article IX, Seller shall indemnify, defend
and hold Purchaser and its officers, directors, employees, agents, advisers,
representatives and Affiliates (collectively, the “Purchaser
Indemnitees”)
harmless from and after the Closing Date from and against any Damages (other
than Taxes, except as provided in Section 9.4(a)) incurred or suffered by the
Purchaser Indemnitees to the extent resulting or arising from or relating to:
(a) any
breach
of any covenant or agreement of Seller made herein that survives the
Closing;
(b) any
Excluded Business, including any liability arising directly or indirectly out
of
the pending investigation of Seller and its Subsidiaries by the U.S. Department
of Justice or any U.S. Attorney’s Office;
(c) any
liability or obligation of Seller or any of its Subsidiaries to the extent
not
related to the Business;
(d) the
Specified Transfers;
(e) any
Controlled Group Liability, in each case only to the extent that such Controlled
Group Liability is not fully reflected in the Balance Sheet;
(f) (i) liabilities
for (x) all Taxes under Section 4999 of the Code and any indemnification
obligations (i.e.,
excise
tax gross-ups) with respect to such taxes payable to or for the benefit of
current or former employees of the Company and its Subsidiaries and (y) any
lost
deductions under Section 280G of the Code with respect to payments made to
current or former employees of the Company and its Subsidiaries;
(ii) liabilities or claims under or in respect of the Company Benefit
Plans, other than benefit liabilities under the Company-Only Plans; and
(iii) liabilities or claims with respect to the employment or termination
of employment of any Excluded Employee or Former Excluded Employee, including
liabilities or claims in respect of such Employees under the Company-Only Plans
(other than as specifically retained as set forth in the proviso of Section
6.4(d)); and
(g) all
liabilities and costs arising from the matter referred to on Section 3.11(d)
of
the Disclosure Schedules.
9.3. Indemnification
by Purchaser.
Subject
to the remaining provisions of this Article IX, Purchaser shall indemnify,
defend and hold Seller and its officers, directors, employees, agents, advisers,
representatives and Affiliates (collectively, the “Seller
Indemnitees”)
harmless from and after the Closing Date from and against any Damages incurred
or suffered by the Seller Indemnitees to the extent resulting or arising from
or
relating to:
(a) any
liability or obligation of the Company or any of its Subsidiaries to the extent
not related to the Excluded Business; and
(b) any
breach
of any covenant or agreement of Purchaser made herein.
9.4. Tax
Indemnification.
(a) Seller
will indemnify, defend and hold harmless the Purchaser and its Affiliates from
and against (i) any Covered Taxes, (ii) any Taxes resulting from any action
pursuant to Section 6.12, (iii) any withholding Tax liability imposed under
Section 1445 of the Code with respect to the purchase of Company Shares; (iv)
any Taxes arising from or in connection with any breach by Seller of any of
its
covenants and obligations under Section 6.8; and (v) all liability for any
reasonable legal, accounting, appraisal, consulting or similar fees and expenses
actually incurred relating to the foregoing.
(b) Purchaser
will indemnify, defend and hold harmless Seller and its Affiliates from and
against (i) any
and all Taxes arising from or in connection with any breach by Purchaser of
any
of its covenants or obligations under Section 6.8 and (ii) all
liability for any reasonable
out-of-pocket legal, accounting, appraisal, consulting or similar fees and
expenses actually incurred relating to the foregoing.
(c) The
obligations of each party pursuant to Sections 9.4(a) and 9.4(b) to indemnify,
defend and hold harmless the other party will terminate 30 days after the
expiration of all applicable statutes of limitations (giving effect to any
extensions thereof); provided,
however,
that
such obligations to indemnify, defend and hold harmless will not terminate
with
respect to any individual item as to which an Indemnified Party shall have,
before the expiration of the applicable period, previously made a claim by
delivering a notice (stating in reasonable detail the basis of such claim)
to
the applicable Indemnifying Party.
9.5. Indemnification
Procedure.
(a) Promptly
after the incurrence of any Damages by the party seeking indemnification
hereunder (the “Indemnified
Party”),
including any claim by a third party described in Section 9.5(d) hereof, which
might give rise to indemnification hereunder or the discovery of any facts
or
circumstances that the Indemnified Party reasonably believes may result in
an
indemnification claim hereunder, the Indemnified Party shall deliver to the
party from which indemnification is sought (the “Indemnifying
Party”)
a
certificate (the “Claim
Certificate”),
which
Claim Certificate shall:
(i) state
that
the Indemnified Party has paid or properly accrued Damages, or anticipates
that
it shall incur liability for Damages for which such Indemnified Party may be
entitled to indemnification pursuant to this Agreement; and
(ii) specify
in
reasonable detail each individual item of Damages included in the amount so
stated to the extent known, the date such item was paid or properly accrued
(if
applicable), the basis for any anticipated liability and the nature of the
claim
to which each such item is related and the computation of the amount, if
reasonably capable of computation, to which such Indemnified Party claims to
be
entitled hereunder;
provided,
however,
that the
failure to deliver such Claim Certificate shall not relieve the Indemnifying
Party of its obligations hereunder except to the extent such failure shall
have
materially prejudiced the Indemnifying Party.
(b) In
case
the Indemnifying Party shall object to the indemnification of an Indemnified
Party in respect of any claim or claims specified in any Claim Certificate,
the
Indemnifying Party shall, within 20 Business Days after receipt by the
Indemnifying Party of such Claim Certificate, deliver to the Indemnified Party
a
written notice to such effect and the Indemnifying Party and the Indemnified
Party shall, within the 20 Business Day period beginning on the date of receipt
by the Indemnified Party of such written objection, attempt in good faith to
agree upon the rights of the respective parties with respect to each of such
claims to which the Indemnifying Party shall have so objected. If the
Indemnified Party and the Indemnifying Party shall succeed in reaching agreement
on their respective rights with respect to any of such claims, the Indemnified
Party and the Indemnifying Party shall promptly prepare and sign a memorandum
setting forth such agreement. If the Indemnified Party and the Indemnifying
Party are unable to agree as to any particular item or items or amount or
amounts, then such disagreement shall be resolved pursuant to judicial process
set forth in Section 10.6.
(c) Claims
for
Damages specified in any Claim Certificate to which an Indemnifying Party shall
not object in writing within 20 Business Days of receipt of such Claim
Certificate, claims for Damages covered by a memorandum of agreement of the
nature described in Section 9.5(b) and claims for Damages the validity and
amount of which have been the subject of a judicial determination pursuant
to
Section 10.6, are hereinafter referred to, collectively, as “Agreed
Claims.”
Within
15 Business Days of the determination of the amount of any Agreed Claims,
subject to the limitations of this Article IX, the Indemnifying Party shall
pay
to the Indemnified Party an amount equal to the Agreed Claim by cashier’s check
or wire transfer to the bank account or accounts designated in writing by the
Indemnified Party not less than one Business Day prior to such
payment.
(d) Promptly
after the assertion by any third party of any claim against any Indemnified
Party that in the reasonable judgment of such Indemnified Party may result
in
the incurrence by such Indemnified Party of Damages for which such Indemnified
Party would be entitled to indemnification pursuant to this Agreement, such
Indemnified Party shall deliver to the Indemnifying Party a written notice
describing in reasonable detail (to the extent known) such claim and such
Indemnifying Party may, at its option, assume the defense of the Indemnified
Party against such claim (including the employment of counsel, who shall be
reasonably satisfactory to such Indemnified Party) at such Indemnifying Party’s
expense. Any failure on the part of the Indemnified Party to provide prompt
notice shall not limit any of the obligations of the Indemnifying Party, except
to the extent such failure materially prejudices the defense of such claim.
Any
Indemnified Party shall have the right to employ separate counsel in
any
such
action or claim and to participate in the defense thereof, but the fees and
expenses of such counsel shall not be at the expense of the Indemnifying Party;
provided
that the
Indemnifying Party shall be responsible for the fees and expenses of the
Indemnified Party’s counsel in any such action or claim if (i) the named parties
to any such action (including any impleaded parties) include both such
Indemnified Party and the Indemnifying Party and such Indemnified Party shall
have been advised by counsel that there may be one or more legal defenses
available to the Indemnified Party which are not available to, or the assertion
of which would be adverse to the interests of, the Indemnified Party or (ii)
the
Indemnified Party shall have been advised in writing by counsel that the
assumption of such defense by the Indemnifying Party would be inappropriate
due
to an actual or potential conflict of interest (provided
that in
the case of clause (i) and (ii) the Indemnifying Party shall not be liable
for
the fees and expenses of more than one firm of counsel for all Indemnified
Parties, other than local counsel). In addition, the Indemnifying Party shall
not be entitled to assume control of the defense of any claim, and shall be
responsible for the fees and expenses of the Indemnified Party’s counsel if the
Indemnified Party shall have failed, within 15 Business Days after having been
notified by the Indemnified Party of the existence of such claim as provided
above, to assume the defense of such claim or to notify the Indemnified Party
in
writing that it shall assume the defense of such claim. No Indemnifying Party
shall be liable to indemnify any Indemnified Party for any settlement of any
such action or claim effected without the consent of the Indemnifying Party
(not
to be unreasonably withheld), but if settled with the written consent of the
Indemnifying Party, or if there be a judgment for the plaintiff in any such
action, the Indemnifying Party shall indemnify and hold harmless each
Indemnified Party from and against any loss or liability by reason of such
settlement or judgment, subject to the limitations set forth in this Article
IX.
If the Indemnifying Party shall assume the defense of any claim in accordance
with the provisions of this Section 9.5(d), the Indemnifying Party shall obtain
the prior written consent of the Indemnified Party before entering into any
settlement of such claim (not to be unreasonably withheld), unless the
settlement releases the Indemnified Party from all liabilities and obligations
with respect to such claim and does not impose injunctive or other equitable
relief against the Indemnified Party. The Indemnified Party and the Indemnifying
Party each agrees to fully cooperate in all matters covered by this Section
9.5(d), including, as required, the furnishing of books and records, personnel
and witnesses and the execution of documents, in each case as necessary for
any
defense of such third party claim and at no cost to the other party (provided
that any reasonable out-of-pockets expenses of the Indemnified Party incurred
in
connection with the foregoing shall be considered part of Damages
hereunder).
Anything
in this Section 9.5(d) to the contrary notwithstanding, the control of any
Tax
Proceeding and the procedures related thereto shall be governed exclusively
by
Sections 6.8(c), 6.8(d) and 6.8(f).
9.6. Certain
Offsets; Tax Treatment of Payments.
For
purposes of this Article IX, “Damages” shall be net of any insurance or other
recoveries (net of any related deductible or expenses incurred in securing
such
recovery) actually received by the Indemnified Party or its Affiliates as a
result of the liability or loss giving rise to the right of indemnification.
In
addition, any indemnification payment made pursuant to this Article IX shall
be
(i) reduced by the amount of any net Tax benefit actually realized by the
Indemnified Party and (ii) increased by the amount of any Tax cost actually
realized by the Indemnified Party solely as a result of the receipt or accrual
of the indemnification payment. The parties agree to treat any payment
pursuant
to this Article IX (other than any portion treated as interest) as an adjustment
to the purchase price for tax purposes.
9.7. Exclusive
Remedy.
After
the Closing Date, this Article IX shall provide the exclusive remedy for any
of
the matters addressed herein or other claims arising out of this Agreement,
except in the case of common law fraud or with respect to matters for which
the
remedy of specific performance, injunctive relief or other non-monetary
equitable remedies are available.
ARTICLE
X
GENERAL
PROVISIONS
10.1. Expenses.
All
costs and expenses incurred in connection with this Agreement and the
transactions contemplated hereby shall be paid by the party incurring such
cost
or expense.
For the
avoidance of doubt, all fees of Seller’s financial and legal advisors incurred
in connection with this Agreement shall be borne by the Seller, and not by
the
Company or any of its Subsidiaries.
10.2. Notices.
All
notices and other communications required or permitted to be given hereunder
shall be sent to the party to whom it is to be given and be either delivered
personally against receipt, by facsimile or other wire transmission, by
registered or certified mail (postage prepaid, return receipt requested) or
deposited with an express courier (with confirmation) to the parties at the
following addresses (or at such other address for a party as shall be specified
by like notice):
(a)
if
to
Seller, to:
ABN
AMRO Holding N.V.
Gustav
Mahlerlaan 10
1082
PP Amsterdam, The Netherlands
Attention:
the Board of Management
Fax:
(31) (20) 628 6293
with
a copy to:
ABN
AMRO
Gustav
Mahlerlaan 10
1082
PP Amsterdam, The Netherlands
Attention:
Eva Simon Thomas
Fax:
(31) (20) 629 2163
with
a
copy to:
Davis
Polk & Wardwell
450
Lexington Avenue
New
York, New York 10017
Attention:
William L. Taylor
William
H. Aaronson
Fax:
(212) 450-4800
(b)
if
to
Purchaser, to:
Bank
of America Corporation
Bank
of America Corporate Center
100
N. Tryon Street
Charlotte,
North Carolina 28255
Attention:
Timothy J. Mayopoulos,
Executive
Vice President and General Counsel
Fax:
(704) 370-3515
with
a
copy to:
Wachtell,
Lipton, Rosen & Katz
51
West 52nd
Street
New
York, New York 10019
Attention:
Edward D. Herlihy
Craig
M. Wasserman
Fax:
(212) 403-2000
All
notices and other communications shall be deemed to have been given
(i) when received if given in person, (ii) on the date of electronic
confirmation of receipt if sent by facsimile or other wire transmission,
(iii) three Business Days after being deposited in the U.S. mail, certified
or registered mail, postage prepaid, or (iv) one Business Day after being
deposited with a reputable overnight courier.
10.3. Interpretation;
Absence of Presumption.
(a) It
is
understood and agreed that the specification of any dollar amount in the
representations and warranties contained in this Agreement or the inclusion
of
any specific item in the Disclosure Schedule is not intended to imply that
such
amounts or higher or lower amounts, or the items so included or other items,
are
or are not material, and neither party shall use the fact of the setting of
such
amounts or the fact of the inclusion of any such item in the Disclosure Schedule
in any dispute or controversy between the parties as to whether any obligation,
item or matter not described in this Agreement or included in the Disclosure
Schedule is or is not material for purposes of this Agreement.
(b) For
the
purposes of this Agreement, (i) words in the singular shall be held to include
the plural and vice
versa
and words
of one gender shall be held to include the other
gender
as
the context requires, (ii) the terms “hereof,” “herein,” and “herewith” and
words of similar import shall, unless otherwise stated, be construed to refer
to
this Agreement as a whole (including all of the Exhibits to this Agreement)
and
not to any particular provision of this Agreement, and Article, Section,
paragraph and Exhibit references are to the Articles, Sections, paragraphs
and
Exhibits to this Agreement unless otherwise specified, (iii) the word
“including” and words of similar import when used in this Agreement shall mean
“including, without limitation,” (iv) the word “or” shall not be exclusive,
(v) all pronouns and any variations thereof refer to the masculine,
feminine or neuter, single or plural, as the context may require, and
(vi) all references to any period of days shall be deemed to be to the
relevant number of calendar days unless otherwise specified.
(c) This
Agreement shall be construed without regard to any presumption or rule requiring
construction or interpretation against the party drafting or causing any
instrument to be drafted.
10.4. Counterparts.
This
Agreement may be executed in counterparts, all of which shall be considered
one
and the same agreement and shall become effective when counterparts have been
signed by each of the parties and delivered to the other parties, it being
understood that all parties need not sign the same counterpart.
10.5. Entire
Agreement.
This
Agreement (including the Disclosure Schedules and other documents and the
instruments referred to herein) constitutes the entire agreement and supersedes
all prior agreements and understandings, both written and oral, among the
parties with respect to the subject matter hereof other than the Confidentiality
Agreement.
10.6. Governing
Law and Venue; Waiver of Jury Trial.
(a) THIS
AGREEMENT SHALL BE DEEMED TO BE MADE IN, AND IN ALL RESPECTS SHALL BE
INTERPRETED, CONSTRUED AND GOVERNED BY AND IN ACCORDANCE WITH THE LAW OF, THE
STATE OF NEW YORK WITHOUT REGARD TO THE CONFLICT OF LAW PRINCIPLES THEREOF.
(b) The
parties hereby (i) irrevocably submit to the exclusive jurisdiction of the
Federal Courts of the United States of America located in the State of New
York
(the “Federal
Courts”),
or, if
jurisdiction in the Federal Courts is not available, the courts of the State
of
New York (the “New
York Courts”),
in
respect of any claim, dispute or controversy relating to or arising out of
the
negotiation, interpretation or enforcement of this Agreement or any of the
documents referred to in this Agreement or the transactions contemplated hereby
or thereby (any such claim being a “Covered
Claim”);
(ii)
irrevocably agree to request that the Federal Courts (or, if jurisdiction in
the
Federal Courts is not available, the New York Courts) adjudicate any Covered
Claim on an expedited basis and to cooperate with each other to assure that
an
expedited resolution of any such dispute is achieved; (iii) waive, and agree
not
to assert, as a defense in any action, suit or proceeding raising a Covered
Claim that any of the parties hereto is not subject to the personal jurisdiction
of the New York Courts or the Federal Courts or that such action, suit or
proceeding may not be brought or is not maintainable in said Courts or that
the
venue thereof may be inappropriate or inconvenient or that this Agreement or
any
such document may not be enforced in or by such Courts; and (iv) irrevocably
agree to abide by the
rules
of
procedure applied by the Federal Courts or the New York Courts, as the case
may
be, (including the procedures for expedited pre-trial discovery) and waive
any
objection to any such procedure on the ground that such procedure would not
be
permitted in the courts of some other jurisdiction or would be contrary to
the
laws of some other jurisdiction. The parties further agree that any Covered
Claim has a significant connection with the United States and the State of
New
York, and will not contend otherwise in any proceeding in any court of any
other
jurisdiction. Each party represents that it has agreed to the jurisdiction
of
the Federal Courts and the New York Courts in respect of Covered Claims after
being fully and adequately advised by legal counsel of its own choice concerning
the procedures and law applied in the Federal Courts and the New York Courts
and
has not relied on any representation by any other party or its Affiliates,
representatives or advisors as to the content, scope, or effect of such
procedures and law, and will not contend otherwise in any proceeding in any
court of any jurisdiction. Notwithstanding the foregoing, nothing in this
Agreement shall limit the right of Purchaser or any of its Subsidiaries or
Affiliates to commence or prosecute any legal action against Seller or any
of
its Subsidiaries or Affiliates in any court of competent jurisdiction in The
Netherlands or elsewhere to enforce the judgments and orders of the Federal
Courts or the New York Courts.
(c) Each
party
hereby irrevocably agrees that it will not oppose, on any ground, the
recognition, enforcement, or exequatur in a Dutch or other court of any judgment
(including but not limited to a judgment requiring specific performance)
rendered by a Federal Court or New York Court in respect of a Covered
Claim.
(d) Seller
hereby irrevocably designates the Corporation Trust Company (in such capacity
the “Process
Agent”),
with
an office at 1209 Orange Street, City of Wilmington, county of Newcastle,
Delaware 19801, as its designee, appointee and agent to receive, for and on
its
behalf service of process in such jurisdiction in any legal action or
proceedings with respect to this Agreement or any other agreement executed
in
connection with this Agreement, and such service shall be deemed complete upon
delivery thereof to the Process Agent; provided
that, in
the case of any such service upon the Process Agent, the party effecting such
service shall also deliver a copy thereof to Seller. Seller shall take all
such
action as may be necessary to continue said appointment in full force and effect
or to appoint another agent so that Seller will at all times have an agent
for
service of process for the above purposes in New York, New York. In the event
of
the transfer of all or substantially all of the assets and business of the
Process Agent to any other person or entity by consolidation, merger, sale
of
assets or otherwise, such other person or entity shall be substituted hereunder
for the Process Agent with the same effect as if named herein in place of such
Process Agent. Seller further irrevocably consents to the service of process
out
of any of the aforementioned courts in any such action or proceeding by the
mailing of copies thereof by registered airmail, postage prepaid, to such party
at its address set forth in this Agreement, such service of process to be
effective upon acknowledgment of receipt of such registered mail. Nothing herein
shall affect the right of any party to serve process in any other manner
permitted by applicable law. Seller expressly acknowledges that the foregoing
waiver is intended to be irrevocable under the laws of the State of New York
and
of the United States of America.
(e) EACH
PARTY
ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS
AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE
EACH SUCH
PARTY
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE
TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT
OF
OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT: (i) NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION,
SEEK
TO ENFORCE THE FOREGOING WAIVER; (ii) EACH PARTY UNDERSTANDS AND HAS
CONSIDERED THE IMPLICATIONS OF THIS WAIVER; (iii) EACH PARTY MAKES THIS
WAIVER VOLUNTARILY; AND (iv) EACH PARTY HAS BEEN INDUCED TO ENTER INTO THIS
AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN
THIS
SECTION 10.6.
10.7. Specific
Performance.
The
parties agree that irreparable damage would occur in the event that any party
fails to consummate the transactions contemplated by this Agreement in
accordance with the terms of this Agreement and that the parties shall be
entitled to specific performance in such event, in addition to any other remedy
at law or in equity.
10.8. Severability.
Any term
or provision of this Agreement which is invalid or unenforceable in any
jurisdiction shall, as to that jurisdiction, be ineffective to the extent of
such invalidity or unenforceability without rendering invalid or unenforceable
the remaining terms and provisions of this Agreement or affecting the validity
or enforceability of any of the terms or provisions of this Agreement in any
other jurisdiction. If any provision of this Agreement is so broad as to be
unenforceable, the provision shall be interpreted to be only so broad as is
enforceable.
10.9. Assignment;
Third-Party Beneficiaries.
Neither
this Agreement nor any of the rights, interests or obligations shall be assigned
by any of the parties hereto (whether by operation of law or otherwise) without
the prior written consent of the other parties; provided,
however,
that
Purchaser may assign any of its rights under this Agreement to a wholly owned
Subsidiary of Purchaser; provided,
further,
that no
such assignment shall release Purchaser from any liability or obligation under
this Agreement. Subject to the preceding sentence, this Agreement will be
binding upon, inure to the benefit of and be enforceable by and against the
parties and their respective successors and assigns. Except for Section
6.15
which is
for the benefit of the persons specified in Section 6.15(c)
this
Agreement (including the documents and instruments referred to herein) is not
intended to confer upon any person other than the parties hereto any rights
or
remedies hereunder.
[Signature
page follows]
IN
WITNESS
WHEREOF, Seller and Purchaser have caused this Agreement to be executed by
their
respective officers thereunto duly authorized as of the date first above
written.
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ABN
AMRO BANK N.V.
By: /s/
Huibert Boumeester
Name:
Huibert Boumeester
Title:
Member of Managing Board
By: /s/
Alexander Pietruska
Name:
Alexander Pietruska
Title:
Executive Vice President
|
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BANK
OF AMERICA CORPORATION
By: /s/
Gregory L.
Curl
Name:
Gregory L. Curl
Title:
Vice Chairman
|
[Signature
Page to Purchase and Sale Agreement]
EXHIBIT
A
The
U.S.
Department of Justice or any U.S. Attorney’s Office shall not, in connection
with the pending investigation of Seller or its Affiliates, have taken any
action against or entered into any settlement with Seller or any of its
Affiliates that shall impose any material restriction, condition or burden
on the Business, the Company or any of its Subsidiaries or, after the
Closing, Purchaser or any of its Subsidiaries.
EXHIBIT
B:
SELLER
KNOWLEDGE
Norman
R.
Bobins
Joost
Ch.
L. Kuiper
Robert
J.
Moore
Larry
D.
Richman
EXHIBIT
C:
PURCHASE
PRICE ADJUSTMENT
(1)
No
later than three Business Days prior to the date on which the Closing is
scheduled to occur, Seller shall deliver to Purchaser a good faith estimate
(the
“Estimated
Net Income”)
of the
sum of (a) the net income (loss) of the Company and its Subsidiaries, as
adjusted as set forth in the definition of Closing Net Income below, for the
period commencing on April 1, 2007 and concluding at the close of
business on the earlier to occur of the Closing Date and December 31, 2007
(the
“Measurement
Period”),
and
(b) actual net income recorded for the three month period ended March 31,
2007. Seller shall also deliver to Purchaser copies of all workpapers and other
documents used in the calculation of Estimated Net Income.
(2)
If
Estimated Net Income is equal to or greater than the Income Threshold, the
Purchase Price shall not be adjusted. If Estimated Net Income is less than
the
Income Threshold, the Purchase Price shall be decreased by the amount of the
shortfall. “Income
Threshold”
means
at
any time the amount equal to the sum of (a) the product of (x) $600 million
and
(y) a fraction, the numerator of which is the number of calendar days that
have
elapsed during the Measurement Period and the denominator of which is 274 and
(b) $270 million.
(3)
Seller
shall engage Ernst & Young LLP (“E&Y”) to prepare and deliver, and shall
use reasonable efforts to cause E&Y to prepare and deliver as promptly as
practicable, but not later than 90 days, after the Closing Date, to the Seller
an audited consolidated income statement of the Company and its Subsidiaries
for
the period commencing on January 1, 2007 and ending on the earlier of the
Closing Date and December 31, 2007 prepared in accordance with the accounting
principles, policies, practices and methodologies used in connection with the
preparation of the Balance Sheet (the “Closing
Income Statement”).
All of
the costs and expenses of such audit shall be born in full by Purchaser.
“Closing
Net Income”
means
the net income (loss) of the Company and its Subsidiaries as shown on the
Closing Income Statement, as adjusted to exclude (a) any costs incurred by
the Company and its Subsidiaries pursuant to this Agreement (provided,
however,
that all
costs and expenses of the financial, legal and other advisors of the Company
and
its Affiliates incurred by the Company or its Subsidiaries in connection with
this Agreement shall be included in the calculation of Closing Net Income),
and
(b) any costs that are required to be indemnified pursuant to Sections 9.2
or 9.4(a) (to avoid any duplication), and determined as set forth in this
Exhibit, but subject to the following clauses (4) and (5). Seller shall upon
receipt promptly provide a copy of the Closing Income Statement and Seller’s
calculation of the Closing Net Income to Purchaser.
(4)
If
Purchaser disagrees with Seller’s calculation of Closing Net Income, Purchaser
may, within 30 days after Seller’s delivery of the Closing Income Statement,
deliver a notice to Seller disagreeing with Seller’s calculation of Closing Net
Income and which specifies Purchaser’s calculation of Closing Net Income and, in
reasonable detail, Purchaser’s grounds for such disagreement. Any such notice of
disagreement shall specify those items or amounts as to which Purchaser
disagrees, and Purchaser shall be deemed to have agreed with all other items
and
amounts contained in the Closing Income Statement and Seller’s calculation of
Closing Net Income.
(5)
If a
notice of disagreement shall be duly delivered pursuant to clause (4) of this
Exhibit, Purchaser and Seller shall, during the 15 days following such delivery,
use their reasonable best efforts to reach agreement on the disputed items
or
amounts in order to determine Closing Net Income, which amount shall not be
less
than the amount thereof shown in Seller’s calculation delivered pursuant to
clause (3) of this Exhibit nor greater than the amount thereof shown in
Purchaser’s calculation delivered pursuant to clause (4) of this Exhibit. If
Purchaser and Seller are unable to reach such agreement during such period,
they
shall promptly thereafter cause an agreed upon firm of independent accountants
of nationally recognized standing in the United States reasonably satisfactory
to Purchaser and Seller (which accountants shall not have any material
relationship with Purchaser or Seller), promptly to review this Agreement and
the disputed items or amounts for the purpose of calculating Closing Net Income.
In making such calculation, such independent accountants shall consider only
those items or amounts in the Closing Income Statement to which Seller has
disagreed and that have not been previously resolved by mutual agreement of
Purchaser and Seller. Such independent accountants shall deliver to Purchaser
and Seller, as promptly as practicable, a report setting forth such calculation.
Such report shall be final and binding upon Purchaser and Seller. The cost
of
such review and report shall be shared equally by Purchaser and Seller.
(6)
Purchaser and Seller agree that they will, and agree to cause their respective
independent accountants and each of the Company and its Subsidiaries to,
cooperate and assist in the preparation of the Closing Income Statement and
in
the conduct of the audits and reviews referred to in this Exhibit, including
the
making available to the extent necessary of books, records, work papers and
personnel.
(7)
If
Final Net Income is greater than the Income Threshold, and Estimated Net Income
is equal to or greater than the Income Threshold, no payment shall be made.
If
Final Net Income is greater than the Income Threshold and Estimated Net Income
was less than the Income Threshold, Seller shall be entitled to receive a
payment from Purchaser equal to the difference between the Income Threshold
and
Estimated Net Income. If Final Net Income is less than the Income Threshold
and
Estimated Net Income is equal to or greater than the Income Threshold, Purchaser
shall be entitled to receive a payment from Seller equal to the amount by which
the Income Threshold exceeds the Final Net Income. If Final Net Income is less
than the Income Threshold and Estimated Net Income is less than the Income
Threshold, then (i) if Final Net Income exceeds Estimated Net Income, Seller
shall be entitled to receive a payment from Purchaser equal to such excess
and
(ii) if Estimated Net Income exceeds Final Net Income, Purchaser shall be
entitled to payment from Seller equal to such excess. “Final
Net Income”
means
the Closing Net Income (i) as shown in Seller’s calculation delivered pursuant
to clause (3) of this Exhibit, if no notice of disagreement with respect thereto
is duly delivered pursuant to clause (4) of this Exhibit; or (ii) if such a
notice of disagreement is delivered, (A) as agreed by Purchaser and Seller
pursuant to clause (5) of this Exhibit or (B), in the absence of such agreement,
as shown in the independent accountant’s report setting forth the final and
binding calculation pursuant to clause (5) of this Exhibit; provided
that in
no event shall Final Net Income be greater than Seller’s calculation of Closing
Net Income delivered pursuant to clause (3) of this Exhibit or less than
Purchaser’s calculation of Closing Net Income delivered pursuant to clause (4)
of this Exhibit, plus, in each case, actual net income recorded for the three
month period ended March 31, 2007.
(8)
Any
payment pursuant to clause (7) of this Exhibit shall be made at a mutually
convenient time and place within 10 days after Final Net Income has been
determined by wire transfer of immediately available funds. Any payment shall
be
made by wire transfer of same day funds to the account designated by the party
entitled to such payment, and shall be accompanied by interest on such amount
from and including the Closing Date to but excluding the date of payment at
a
rate per annum equal to the Federal Effective Rate in effect from time to time
during the period from the Closing Date to the date of payment.
Cautionary
statement regarding forward-looking statements
This
announcement contains forward-looking statements. Forward-looking statements
are
statements that are not historical facts, including statements about our
beliefs
and expectations. Any statement in this announcement that expresses or implies
our intentions, beliefs, expectations or predictions (and the assumptions
underlying them) is a forward-looking statement. These statements are based
on
plans, estimates and projections, as they are currently available to the
management of ABN AMRO Holding N.V. (“ABN AMRO”). Forward-looking statements
therefore speak only as of the date they are made, and we take no obligation
to
update publicly any of them in light of new information or future events.
Forward-looking
statements involve inherent risks and uncertainties. A number of important
factors could therefore cause actual future results to differ materially
from
those expressed or implied in any forward looking statement. Such factors
include, without limitation, the consummation of our proposed merger with
Barclays PLC (“Barclays”); the completion of our proposed disposition of
LaSalle; the conditions in the financial markets in Europe, the United States,
Brazil and elsewhere from which we derive a substantial portion of our trading
revenues; potential defaults of borrowers or trading counterparties; the
implementation of our restructuring including the envisaged reduction in
headcount; the reliability of our risk management policies, procedures and
methods; the outcome of ongoing criminal investigations and other regulatory
initiatives related to compliance matters in the United States and the nature
and severity of any sanctions imposed; and other risks referenced in our
filings
with the US Securities and Exchange Commission. For more information on these
and other factors, please refer to Part I: Item 3.D “Risk Factors” in our Annual
Report on Form 20-F filed with the US Securities and Exchange Commission
and to
any subsequent reports furnished or filed by us with the US Securities and
Exchange Commission. The forward-looking statements contained in this
announcement are made as of the date hereof, and the companies assume no
obligation to update any of the forward-looking statements contained in this
announcement.
Signatures
Pursuant
to the requirements of the
Securities Exchange Act of 1934, the registrant has duly caused this report
to
be signed on its behalf by the undersigned, thereunto duly authorized.
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ABN
AMRO HOLDING N.V. |
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By: |
/s/ Richard Bruens |
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Name: |
Richard
Bruens
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Title: |
Head of Investor
Relations |
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| Date:
April 24,
2007 |
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By: |
/s/
Petri Hofsté |
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Name: |
Petri
Hofsté |
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Title: |
Chief Accounting Officer |
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