exv10w1






Exhibit 10.1




EXECUTION COPY



 


 



PURCHASE AND ASSUMPTION AGREEMENT




BY AND BETWEEN




FIRSTMERIT BANK, N.A.




AND




FIRST BANK




Dated as of November 11, 2009



 


 



 









 








TABLE OF CONTENTS




	 	 	 	 	 	 	 
	 	 	 	 	Tab	 
	 
	 	 	 	 	 	 
	ARTICLE 1 DEFINITIONS	 	 	1	 
	 
	 	 	 	 	 	 
	ARTICLE 2 PURCHASE AND SALE	 	 	15	 
	2.1
	 	The Acquisition	 	 	15	 
	2.2
	 	Consideration for the Acquisition	 	 	19	 
	2.3
	 	Allocation	 	 	22	 
	2.4
	 	Pro Rata Adjustment and Reimbursement	 	 	23	 
	2.5
	 	Closing	 	 	24	 
	2.6
	 	Repurchase of Non-Conforming Loans	 	 	25	 
	 
	 	 	 	 	 	 
	ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF SELLER	 	 	26	 
	3.1
	 	Organization, Qualification, and Corporate Power	 	 	26	 
	3.2
	 	Authorization of Transaction	 	 	26	 
	3.3
	 	Noncontravention	 	 	27	 
	3.4
	 	Governmental Authorizations	 	 	27	 
	3.5
	 	Brokers’ Fees	 	 	27	 
	 
	 	 	 	 	 	 
	ARTICLE 4 REPRESENTATIONS AND WARRANTIES CONCERNING THE BRANCHES	 	 	27	 
	4.1
	 	Title; Tangible Personal Property	 	 	28	 
	4.2
	 	Deposits	 	 	28	 
	4.3
	 	Undisclosed Liabilities	 	 	29	 
	4.4
	 	Tax Matters	 	 	29	 
	4.5
	 	Employee Benefits	 	 	30	 
	4.6
	 	Compliance with Applicable Laws	 	 	30	 
	4.7
	 	Legal Proceedings; Orders	 	 	31	 
	4.8
	 	Employees	 	 	31	 
	4.9
	 	Environmental Matters	 	 	32	 
	4.10
	 	Loans	 	 	34	 
	4.11
	 	Owned Real Property, Leased Real Properties and Tangible Personal Property	 	 	36	 
	4.12
	 	Leased Real Property	 	 	39	 
	4.13
	 	Acquired Contracts	 	 	39	 
	4.14
	 	Absence of Certain Changes and Events	 	 	40	 
	4.15
	 	Escheat Deposits	 	 	41	 
	4.16
	 	Books and Records	 	 	41	 






(i)









 






	 	 	 	 	 	 	 
	 	 	 	 	Tab	 
	4.17
	 	Insurance	 	 	41	 
	4.18
	 	Disclosure	 	 	41	 
	4.19
	 	Community Reinvestment Act Designations	 	 	41	 
	4.20
	 	No Knowledge of Fraud	 	 	42	 
	4.21
	 	Limitation on Warranties	 	 	42	 
	 
	 	 	 	 	 	 
	ARTICLE 5 REPRESENTATIONS AND WARRANTIES OF BUYER	 	 	42	 
	5.1
	 	Organization, Qualification, and Corporate Power	 	 	42	 
	5.2
	 	Authorization of Transaction	 	 	42	 
	5.3
	 	Noncontravention	 	 	42	 
	5.4
	 	Brokers’ Fees	 	 	43	 
	5.5
	 	Legal Proceedings; Orders	 	 	43	 
	5.6
	 	Financial Condition	 	 	43	 
	5.7
	 	Regulatory Condition	 	 	43	 
	 
	 	 	 	 	 	 
	ARTICLE 6 PRE-CLOSING COVENANTS	 	 	43	 
	6.1
	 	Operation of Business	 	 	44	 
	6.2
	 	Notice of Potential Material Adverse Effect	 	 	46	 
	6.3
	 	Reasonable Access	 	 	46	 
	6.4
	 	Press Releases	 	 	47	 
	6.5
	 	Exclusivity	 	 	47	 
	6.6
	 	Regulatory Matters and Approvals	 	 	47	 
	6.7
	 	Employment	 	 	48	 
	6.8
	 	Conveyance of Customer Accounts	 	 	50	 
	6.9
	 	Branch Access	 	 	50	 
	6.10
	 	Maintenance of Properties	 	 	51	 
	6.11
	 	Conversion Planning and Execution	 	 	51	 
	6.12
	 	General Third Party Consents	 	 	51	 
	6.13
	 	Title Insurance and Surveys	 	 	52	 
	6.14
	 	Insurance Proceeds and Casualty Payments	 	 	53	 
	6.15
	 	Environmental Reports and Investigations	 	 	53	 
	6.16
	 	Condemnation	 	 	55	 
	6.17
	 	Exclusion of Non-Core Deposits	 	 	55	 
	6.18
	 	Additions to Loans; Removal of Certain Loans	 	 	55	 
	6.19
	 	Subordination, Non-Disturbance and Attornment Agreements	 	 	56	 
	6.20
	 	Assumption of IRA and Keogh Account Deposits	 	 	56	 
	6.21
	 	Naperville Branch	 	 	57	 
	6.22
	 	Post-Signing Selection of Certain Excluded Tangible Personal Property	 	 	57	 
	 
	 	 	 	 	 	 
	ARTICLE 7 POST-CLOSING COVENANTS	 	 	57	 






(ii)









 






	 	 	 	 	 	 	 
	 	 	 	 	Tab	 
	7.1
	 	Continued Cooperation	 	 	57	 
	7.2
	 	Transitional Matters Concerning Deposits	 	 	57	 
	7.3
	 	Transitional Matters Concerning Loans	 	 	60	 
	7.4
	 	Transitional Matters Concerning Real Estate Interests	 	 	60	 
	7.5
	 	Transfer of Books and Records	 	 	60	 
	7.6
	 	Electronic Records, Conversion, and Servicing	 	 	62	 
	7.7
	 	Tax Reporting Obligations	 	 	62	 
	7.8
	 	Credit Life Insurance Refunds	 	 	63	 
	7.9
	 	Non-Solicitation of Employees	 	 	64	 
	7.10
	 	Non-Solicitation of Business	 	 	64	 
	7.11
	 	Covenant Not to Compete	 	 	64	 
	7.12
	 	Legal Inquiries	 	 	66	 
	7.13
	 	Employment	 	 	66	 
	7.14
	 	Removal of Seller’s Name from Signs	 	 	67	 
	 
	 	 	 	 	 	 
	ARTICLE 8 CONDITIONS TO OBLIGATION TO CLOSE	 	 	67	 
	8.1
	 	Conditions to Obligation of Buyer	 	 	67	 
	8.2
	 	Conditions to Obligation of Seller	 	 	70	 
	 
	 	 	 	 	 	 
	ARTICLE 9 ITEMS TO BE DELIVERED AT OR PRIOR TO CLOSING	 	 	70	 
	9.1
	 	By Seller	 	 	70	 
	9.2
	 	By Buyer	 	 	71	 
	 
	 	 	 	 	 	 
	ARTICLE 10 TERMINATION	 	 	72	 
	10.1
	 	Termination of Agreement	 	 	72	 
	10.2
	 	Effect of Termination	 	 	73	 
	 
	 	 	 	 	 	 
	ARTICLE 11 REMEDIES FOR BREACH OF THIS AGREEMENT	 	 	73	 
	11.1
	 	Survival	 	 	73	 
	11.2
	 	Indemnification by Seller	 	 	74	 
	11.3
	 	Indemnification by Buyer	 	 	74	 
	11.4
	 	Limitations on Indemnity	 	 	75	 
	11.5
	 	Third Party Claims	 	 	76	 
	11.6
	 	Losses Computed Without Giving Effect to Materiality	 	 	79	 
	11.7
	 	Indemnity Payments Treated as Adjustments to Purchase Price	 	 	79	 
	11.8
	 	After-Tax Nature of Indemnity Payments	 	 	79	 
	11.9
	 	Third Party Beneficiaries	 	 	79	 
	 
	 	 	 	 	 	 
	ARTICLE 12 MISCELLANEOUS	 	 	79	 
	12.1
	 	Governing Law	 	 	79	 
	12.2
	 	Consent to Jurisdiction; Waiver of Jury Trial	 	 	79	 






(iii)









 






	 	 	 	 	 	 	 
	 	 	 	 	Tab	 
	12.3
	 	Waiver of Punitive Damages and Jury Trial	 	 	80	 
	12.4
	 	Successors and Assigns; No Third-Party Rights	 	 	81	 
	12.5
	 	Entire Agreement; Amendment	 	 	81	 
	12.6
	 	Notices	 	 	81	 
	12.7
	 	Amendments and Waivers	 	 	82	 
	12.8
	 	Counterparts	 	 	82	 
	12.9
	 	Severability	 	 	82	 
	12.10
	 	Titles and Subtitles	 	 	82	 
	12.11
	 	Construction	 	 	82	 
	12.12
	 	Expenses	 	 	83	 
	12.13
	 	Waiver of Compliance with Bulk Sales Laws	 	 	83	 
	12.14
	 	Next Business Day	 	 	83	 






	 	 	 
	Exhibit A

	 	Seller’s Branches
	Exhibit B

	 	FMER Loan Review Standards
	Exhibit C

	 	Form of Limited Power of Attorney
	 
	 	 
	Schedule 1.1

	 	Loans
	Schedule 1.2

	 	Select Remote Employees
	Schedule 2.1(a)(vii)(B)

	 	Acquired Contracts
	Schedule 2.1(b)(i)

	 	Excluded Tangible Personal Property
	Schedule 3.2

	 	Consents
	Schedule 4.2(e)

	 	Exceptions to Deposits
	Schedule 4.2(f)

	 	Exceptions to Deposit Agreements
	Schedule 4.7(a)

	 	Legal Proceedings; Orders
	Schedule 4.8(b)

	 	Employment Agreements
	Schedule 4.8(d)

	 	Employment-Related Claims
	Schedule 4.9(a)

	 	Compliance with Environmental Laws
	Schedule 4.9(g)

	 	Asbestos, Mold and Lead-Based Paint
	Schedule 4.10(a)

	 	Loans to Employees and Affiliates
	Schedule 4.11(a)(i)

	 	Owned Real Property
	Schedule 4.11(a)(ii)

	 	Tenant Leases
	Schedule 4.11(b)

	 	Issues Affecting Owned Real Property, Leased Property and Tangible Personal Property
	Schedule 4.12

	 	Leases
	Schedule 4.14(e)

	 	Compensation Increases
	Schedule 6.11

	 	Conversion-Related Responsibilities
	Schedule 6.20(c)

	 	Excluded IRA/Keogh Accounts
	Schedule 8.1(m)

	 	Employment Agreements with Buyer







(iv)











 





PURCHASE AND ASSUMPTION AGREEMENT




     THIS PURCHASE AND ASSUMPTION AGREEMENT (this “Agreement”) entered into as of November
11, 2009, by and between FIRSTMERIT BANK, N.A., a national banking association (“Buyer”),
and FIRST BANK, a Missouri state chartered bank (“Seller”). Buyer and Seller are referred
to collectively herein as the “Parties.”



WITNESSETH




     WHEREAS, Buyer and Seller are each engaged in the business of banking;



     WHEREAS, Seller desires to sell certain assets and transfer certain liabilities with respect
to Seller’s branch operations which are listed on Exhibit A and referred to herein as the
Branches;



     WHEREAS, Buyer desires to purchase certain assets and assume certain liabilities of Seller
related to the Branches;



     WHEREAS, the Parties desire to set forth in writing the terms and conditions under which the
transaction will be consummated.



     NOW, THEREFORE, in consideration of the foregoing and of the representations, warranties,
covenants and agreements set forth herein, and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged by the Parties, the Parties hereby agree as
follows:



ARTICLE 1

DEFINITIONS




     Capitalized terms used but not otherwise defined herein shall have the following meanings:



     “ABL Purchase Agreement” means that certain Loan Purchase Agreement, dated of even
date hereof, between Buyer and First Bank Business Capital, Inc., as amended, modified or
supplemented from time to time in accordance with the terms thereof.



     “Accountant” has the meaning set forth in Section 2.2(d) of this Agreement.



     “ACH” has the meaning set forth in Section 7.2(g) of this Agreement.



     “Acquired Assets” has the meaning set forth in Section 2.1(a) of this
Agreement.



     “Acquired Branches” means the Branches other than the Rejected Branches.



     “Acquired Contracts” has the meaning set forth in Section 2.1(a)(vii) of this
Agreement.



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     “Acquired Intellectual Property” has the meaning set forth in Section
2.1(a)(iii) of this Agreement.



     “Acquired Leased Real Properties” has the meaning set forth in Section
2.1(a)(v) of this Agreement.



     “Acquired Leasehold Improvements” has the meaning set forth in Section
2.1(a)(vi) of this Agreement.



     “Acquired Leases” has the meaning set forth in Section 2.1(a)(v) of this
Agreement.



     “Acquired Owned Real Property” means the Owned Real Property other than the Excluded
Owned Real Property, if any.



     “Acquired Tangible Personal Property” has the meaning set forth in Section
2.1(a)(ii) of this Agreement.



     “Acquisition” means the acquisition by Buyer of the Acquired Assets and the assumption
of the Assumed Liabilities pursuant to the terms of this Agreement.



     “Acquisition Closing Date Balance Sheet” means an unaudited balance sheet listing only
the Acquired Assets and the Assumed Liabilities as of the close of business on the Closing Date and
prepared from and using the same methodologies and principles used in connection with the Closing
Date Balance Sheet, which unaudited balance sheet shall also include appropriate line items in
respect of the Taxes and other prepaid expenses or items to be prorated between Buyer and Seller as
required by Section 2.4 of this Agreement.



     “Acquisition Pre-Closing Balance Sheet” means an unaudited balance sheet listing only
the Acquired Assets and the Assumed Liabilities as of the last day of the immediately preceding
month end prior to the Closing Date and prepared from and using the same methodologies and
principles used in connection with the Pre-Closing Balance Sheet, which unaudited balance sheet
shall be prepared by Seller and delivered to Buyer on or before the fifth (5th) Business
Day prior to the Closing Date and shall include appropriate line items in respect of the Taxes and
other prepaid expenses or items to be prorated between Buyer and Seller as required by Section
2.4 of this Agreement.



     “Affiliate” means with respect to any Person, any Person directly or indirectly
controlling, controlled by, or under common control with such other Person. For purposes of this
definition, “control” (including with correlative meaning, the terms “controlled by” and “under
common control with”) as used with respect to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and policies of such
Person, whether through ownership of voting securities, by contract or otherwise; provided,
however, that with respect to Seller, “Affiliate” means FB Parent and the Affiliates of
Seller or FB Parent that are controlled, either directly or indirectly, by Seller or FB Parent.



     “Agreement” has the meaning set forth in the preface above.



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     “Applicable Laws” means all applicable federal, state, county and municipal laws,
codes, injunctions, judgments, orders, decrees, rulings and charges thereunder and other
governmental requirements, constitutions, ordinances, statutes, rules, regulations, and
administrative interpretations and pronouncements.



     “Assumed Liabilities” has the meaning set forth in Section 2.1(c) of this
Agreement.



     “Book Value” means, with respect to any Acquired Asset and any Assumed Liability, the
dollar amount thereof stated on the accounting records of Seller. The Book Value of any item shall
be determined as of the Closing Date after adjustments made by Seller for differences in accounts,
suspense items, unposted debits and credits, and other similar adjustments or corrections. Without
limiting the generality of the foregoing, the Book Value of (i) an Assumed Liability shall include
all accrued and unpaid interest thereon as of the Closing Date, (ii) a Loan shall reflect
adjustments for earned or unearned interest (as it relates to the “rule of 78s” or add-on-interest
loans, as applicable), if any, as of the Closing Date, and adjustments for the portion of earned or
unearned loan-related credit life and/or disability insurance premiums, FAS 91 costs, if any,
attributable to Seller as of the Closing Date in each case determined for financial reporting
purposes, (iii) a Commitment shall be deemed to be zero, and (iv) the Acquired Tangible Personal
Property and the Owned Real Property shall be the net book value thereof prorated to the Closing
Date except that the Book Value of all signs and sign framing, posts, structures and other signage
infrastructure shall be zero. The Book Value of an Acquired Contract shall be zero. The Book
Value of an Acquired Asset shall not include any adjustment for any general or specific reserves on
the accounting records of Seller. Seller shall continue to depreciate the Acquired Assets in
accordance with generally accepted accounting principles applied on a basis consistent with prior
periods provided that Seller shall not book depreciation less often than monthly.



     “Books and Records” has the meaning set forth in Section 7.5 of this
Agreement.



     “Branches” means Seller’s branch offices listed on Exhibit A. (Any individual
location may be referred to as “Branch” if the context so requires.)



     “Business Day” means a day other than a Saturday, Sunday or any holiday observed by
the Federal Reserve.



     “Buyer” has the meaning set forth in the preface above.



     “Buyer Documents” means this Agreement and each other agreement, instrument or
document entered into by Buyer pursuant to this Agreement.



     “Buyer Indemnitees” has the meaning set forth in Section 11.2 of this
Agreement.



     “Buyer Material Adverse Effect” means, with respect to Buyer, any condition, event,
change or occurrence that, individually or collectively, is reasonably likely to have a material
adverse effect upon the ability of Buyer to perform its obligations under, and to consummate the
transactions contemplated by this Agreement.



     “Buyer’s 401(k) plan” has the meaning set forth in Section 7.13(a) of this
Agreement.



3









 





     “Buyer Taxes” has the meaning set forth in Section 11.5(d) of this Agreement.



     “Cap” has the meaning set forth in Section 11.4(a) of this Agreement.



     “Claim Notice” has the meaning set forth in Section 11.5(a)(i) of this
Agreement.



     “Closing” has the meaning set forth in Section 2.5(a) of this Agreement.



     “Closing Date” has the meaning set forth in Section 2.5(a) of this Agreement.



     “Closing Date Balance Sheet” means an unaudited balance sheet listing the assets and
liabilities of the Branches as of the close of business on the Closing Date prepared in accordance
with generally accepted accounting principles applied on a basis consistent with prior periods.



     “Code” means the Internal Revenue Code of 1986, as amended.



     “Commercially Reasonable Efforts” means efforts that a prudent Person desirous of
achieving a result would use in similar circumstances to achieve that result; provided,
however, that Commercially Reasonable Efforts shall not be deemed to require a Person to
undertake extraordinary or unreasonable measures, including the payment of amounts in excess of
normal and usual filing fees and processing fees, if any, or other payments with respect to any
Contract that are significant in the context of such Contract (or significant on an aggregate basis
as to all Contracts).



     “Commitments” means unfunded commitments by Seller to lend funds to customers of the
Branches on the terms and conditions set forth in the applicable commitment letters or other
documentation, as such commitments exist as of the Closing Date.



     “Consent” means any approval, consent, ratification, waiver, or other authorization
(including, without limitation, any Governmental Authorization, and any other third party consents
necessary for the assignment to Buyer of any Acquired Contract); provided, however,
that “Consent” shall not include any Landlord Consent.



     “Contract” means any agreement, contract, lease, obligation, promise or undertaking
(whether written or oral and whether express or implied) that is legally binding.



     “Controlling Party” has the meaning set forth in Section 11.5(d) of this
Agreement.



     “Cut-Off Date” means the date that is one hundred eighty days following the Closing
Date.



     “Deposits” means all deposits (as defined in 12 U.S.C. § 1813(l)), and the obligations
and duties incidental thereto, which are assigned to the Branches, including demand deposit
accounts, time and savings accounts, interest checking accounts, deposits relating to debit cards /
ATM cards, certificates of deposits, IRAs (to the extent contemplated by Section 6.20(a)),
Keogh Accounts (to the extent contemplated by Section 6.20(b)), sweep accounts and other
deposit accounts, including for each, all interest accrued but unpaid and both collected and
uncollected funds through the Closing Date; and including the obligations relating to the clearance
of checks



4









 







and drafts drawn against the deposit liabilities, in accordance with the Books and Records of
the Branches as of the close of business on the Closing Date; provided however that
deposits shall not include (a) deposits constituting official checks, travelers checks, money
orders, certified checks or other items in the process of clearing on the Closing Date; (b)
deposits pledged as collateral for any Excluded Loan; (c) any deposit account with an overdraft in
excess of $1,000 outstanding as of the calendar month end immediately preceding the Closing Date;
(d) the Excluded IRA/Keogh Account Deposits; (e) Non-Core Deposits excluded by Buyer pursuant to
the provisions of Section 6.17; (f) deposits that would be presumed to be abandoned under
escheat law or other abandoned property law of any applicable jurisdiction, (g) brokered deposits,
and (h) deposits of Branches excluded under Section 6.12, 6.13, 6.15 or
6.21 due to the inability to transfer such Deposits to Buyer on account of the failure to
satisfy applicable regulatory requirements with respect to any such transfer prior to the Closing
Date.



     “Disagreement” has the meaning set forth in Section 2.2(c) of this Agreement.



     “Disclosure Schedule” means the disclosure Schedules delivered by Seller under
Articles 3 and 4 of this Agreement that limit or qualify the representations and
warranties made by Seller under Articles 3 and 4 of this Agreement.



     “Draft Allocation Statement” has the meaning set forth in Section 2.3(a) of
this Agreement.



     “Effective Time” has the meaning set forth in Section 2.5(b) of this
Agreement.



     “Encumbrance” means any charge, claim, community property interest, condition,
encumbrance, equitable interest, lien, option, pledge, mortgage, security interest, right of first
refusal, or restriction of any kind, including any restriction on use, voting, transfer, receipt of
income, or exercise of any other attribute of ownership.



     “Environmental Law” means any federal, state or local law (including common law),
statute, ordinance, rule, regulation, code, Consent, Order, or agreement with any Governmental Body
in each case as amended from time to time relating to (1) the protection, preservation or
restoration of the indoor or outdoor environment (including, without limitation, air, water vapor,
surface water, groundwater, drinking water supply, surface soil, subsurface soil, plant and animal
life or any other natural resource), or (2) the use, storage, remediation, removal, inspection,
monitoring, recycling, treatment, generation, transportation, processing, handling, labeling,
production, release or disposal of, or exposure to, or injury or damage by, any Hazardous
Materials, including, without limitation, the Comprehensive Environmental Response, Compensation,
and Liability Act of 1980 (“CERCLA”), as amended; the Hazardous Materials Transportation Act, as
amended; the Resource Conservation and Recovery Act of 1976, as amended; the Federal Water
Pollution Control Act, as amended; the Toxic Substances Control Act, as amended; the Clean Air Act,
as amended; the Occupational Safety and Health Act, as amended; and the Safe Drinking Water Act, as
amended.



     “Estimated Payment Amount” has the meaning set forth in Section 2.2(b) of this
Agreement.



5









 





     “Estimated Payment Amount Statement” has the meaning set forth in Section
2.2(b) of this Agreement.



     “Excluded Assets” has the meaning set forth in Section 2.1(b) of this
Agreement.



     “Excluded Intellectual Property” has the meaning set forth in Section
2.1(b)(ii) of this Agreement.



     “Excluded IRA/Keogh Account Deposits” has the meaning set forth in Section
6.20(c).



     “Excluded Lease” means any Lease in respect of any item of Excluded Leased Real
Property.



     “Excluded Leased Real Property” means any Leased Real Property that has been excluded
from the Acquisition by Buyer pursuant to Section 6.12, 6.13 or 6.15 of
this Agreement.



     “Excluded Liabilities” has the meaning set forth in Section 2.1(d) of this
Agreement.



     “Excluded Loans” has the meaning set forth in Section 2.1(b)(iv) of this
Agreement.



     “Excluded Owned Real Property” means any Owned Real Property that has been excluded
from the Acquisition by Buyer pursuant to Section 6.13, 6.15 or 6.21 of
this Agreement.



     “Excluded Tangible Personal Property” has the meaning set forth in Section
2.1(b)(i) of this Agreement.



     “Fair Market Value” means the fair market value as determined by an appraiser that is
mutually agreeable to Seller and Buyer and that is independent and has no fewer than seven (7)
years experience appraising similar property in the county in which the parcel of Owned Real
Property is located.



     “FB Parent” means First Banks, Inc., a Missouri corporation and the legal and
beneficial owner of all of the issued and outstanding capital stock of The San Francisco Company
and Coast Financial Holdings, Inc., which together are the legal and beneficial owners of all of
the issued and outstanding capital stock of Seller.



     “FDIC” means the Federal Deposit Insurance Corporation.



     “Federal Funds Rate” means the federal funds target rate as quoted by the Federal
Reserve Bank of St. Louis on the relevant Business Day.



     “Fiduciary Relationships” means (a) any and all common law or other trusts between
individual, corporate or other entities with Seller as a trustee or co-trustee, including, without
limitation, pension, compensation, testamentary, and charitable trusts and indentures, (b) any and
all decedents’ estates where Seller is serving as a co- or sole executor, personal representative
or administrator, administrator de bonis non, administrator de bonis non with will annexed, or in



6









 







any similar fiduciary capacity, (c) any and all guardianships, conservatorships or similar
positions where Seller is serving or has served as a co- or sole guardian or conservator, or any
similar fiduciary capacity, (d) any and all agency and/or custodial accounts and/or similar
arrangements under which Seller is serving or has served as an agent or custodian for the owner or
other party establishing the account with or without investment authority and (e) any and all
escrow arrangements under which Seller holds or held assets for any party or parties on stated
terms and conditions.



     “Final Allocation Statement” has the meaning set forth in Section 2.3(a) of
this Agreement.



     “Final Payment Amount Statement” has the meaning set forth in Section 2.2(c)
of this Agreement.



     “FMER Loan Review Standards” means the loan review standards of Buyer described on
Exhibit B hereto.



     “Geographic Region” has the meaning set forth in Section 7.11 of this
Agreement.



     “Governmental Authorization” means any approval, consent, license, permit,
registration, certification, exemption, waiver or other authorization issued, granted, given or
otherwise made available by or under the authority of any Governmental Body or pursuant to any
Applicable Law.



     “Governmental Body” means any (a) federal, state, local, municipal, foreign or other
government; (b) governmental or quasi-governmental authority of any nature (including any
governmental agency, branch, department, official or entity and any court or other tribunal); or
(c) body exercising, or entitled to exercise, any administrative, executive, judicial, legislative,
police, regulatory, or taxing authority.



     “Hazardous Materials” means (i) any petroleum or petroleum products, natural gas, or
natural gas products, radioactive materials, asbestos, mold, lead, radon gas, urea formaldehyde
foam insulation, transformers or other equipment that contains dielectric fluid containing levels
of polychlorinated biphenyls (PCBs) and radon gas; (ii) any chemical, material, waste or substance
defined, listed, classified or described as “hazardous substance,” “hazardous waste,” “regulated
substance,” “solid waste,” “hazardous material,” “extremely hazardous waste,” “restricted hazardous
waste,” “toxic substance,” “toxic pollutant,” “contaminant,” or “pollutant” under any Environmental
Laws; and (iii) any material, waste or substance the use, disposal, or handling of which is in any
way regulated by any Governmental Body, including any such material, waste or substance regulated
as hazardous or toxic by any Governmental Body, including mixtures thereof with other materials,
and including any regulated building materials containing asbestos or lead. Notwithstanding the
preceding, however, “Hazardous Materials” shall not mean or include any such Hazardous Material (A)
used, generated, manufactured, stored, disposed of or otherwise handled in normal quantities in the
Ordinary Course of Business in compliance with all applicable Environmental Laws as in existence on
the date hereof, or (B) that may be naturally occurring in any ambient air, surface water, ground
water, land surface or subsurface strata.



7









 





     “Holds” has the meaning set forth in Section 7.2(h) of this Agreement.



     “Indemnifying Party” means the Party that is required to indemnify an Indemnitee
pursuant to Article 11 hereof.



     “Insurance” has the meaning set forth in Section 7.8 of this Agreement.



     “Indemnitee” means any Person that may be entitled to seek indemnification pursuant to
Article 11 hereof.



     “IRA” means an “individual retirement account” or similar account created by a trust
for the exclusive benefit of any individual or his beneficiaries in accordance with the provisions
of Section 408 or Section 408A of the Code.



     “Keogh Account” means an account created by a trust for the benefit of employees (some
or all of whom are owner-employees) and that complies with the provisions of Section 401 of the
Code.



     “Knowledge” of a particular fact or other matter means information actually known to a
Parties’ officers, directors, senior managers or Branch managers or such other information that a
prudent person could be expected to discover after due inquiry appropriate under the circumstances;
provided, however, that Seller shall be deemed to have knowledge of any matter,
fact, event, default, violation, breach, noncompliance, notice, consent or other circumstance if
any of the same shall have been delivered in writing to Seller at anytime prior to the Closing.



     “Landlord Consents” has the meaning set forth in Section 4.12 of this
Agreement.



     “Leased Real Property” means, with respect to any Lease, the real property and
improvements leased by Seller under such Lease.



     “Leasehold Improvements” means, with respect to any Lease, all improvements by Seller
to the Leased Real Property under such Lease.



     “Leases” has the meaning set forth in Section 4.12 of this Agreement;
provided, however, that, for the avoidance of doubt, the Leases shall not include,
and Buyer shall not be acquiring or assuming from Seller (i) the leases for suites 140 and 165, 161
N. Clark, Chicago, Illinois, (ii) the leases for suites 110 and 113, drive thru and ATM facilities
at 15255 South 94th Avenue, Orland Park, Illinois, or (iii) suite 3, 700 Osterman Avenue,
Deerfield, Illinois.



     “Liability” means any liability (INCLUDING, WITHOUT LIMITATION, ANY STRICT LIABILITY),
whether known or unknown, asserted or unasserted, absolute or contingent, accrued or unaccrued,
liquidated or unliquidated, and due or to become due, of any nature whatsoever, including any
liability for Taxes.



     “Loans” mean (a) the loans and participation interests in the loans (including
servicing rights where applicable, accrued but unpaid interest and any accrued but unpaid ancillary
income due under the term of the note) and Commitments in the amounts set forth on the Books and
Records of the Branches as of the close of business on the Closing Date that are identified by



8









 







Buyer to Seller on Schedule 1.1, as such Schedule may be supplemented or amended
pursuant to Section 6.18 of this Agreement, and (b) overdrafts of less than $1,000 in
deposit accounts of the Branches; provided, however, that Loans shall not include
any of the following loans, participation interests, Commitments and overdrafts except to the
extent any of them are identified in the Special Acceptance Notice delivered by Buyer to Seller at
least five (5) Business Days prior to the Closing Date:




     (i) any such loan, participation interest, Commitment or overdraft that is delinquent
as of the Closing Date or, if not delinquent as of the Closing Date, would have been
delinquent at anytime during the 180 day period prior to the Closing Date but for the
granting of any grace period, waiver, forbearance, extension, modification or amendment;




     (ii) any such loan, participation interest, Commitment or overdraft of any obligor if
the financial condition of such obligor as of the Closing Date is such that Buyer would
place such loan, participation interest, Commitment or overdraft on “watch” (or worse)
status in accordance with the FMER Loan Review Standards;




     (iii) any such loan, participation interest, Commitment or overdraft of any obligor
that is subject to a pending legal proceeding related to a customer’s inability or refusal
to pay such loan, Commitment or overdraft;




     (iv) any such loan, participation interest, Commitment or overdraft of any obligor that
is subject to pending proceedings against the obligor or obligors (including any guarantor)
of such loan, participation interest, Commitment or overdraft under any law, rule or
regulation relating to bankruptcy, insolvency, reorganization or other relief from
creditors;




     (v) any such loan, participation interest, Commitment or overdraft that constitutes an
SBA Loan unless the SBA Consent with respect thereto shall have been obtained as of the
Closing Date;




     (vi) any such loan, participation interest or Commitment that has been fully discharged
and satisfied or, in the case of a Commitment, terminated as of the Closing Date; and




     (vii) any such loan, participation interest, Commitment or overdraft that constitutes a
Non-Conforming Loan pursuant to clause (i) or (ii) of the definition of Non-Conforming Loan
set forth in this Article 1.



     “Loss” or “Losses” means any and all losses, costs, Liabilities, damages,
demands, penalties, fines, settlements, response or remedial or inspection costs, reasonable
expenses (including, without limitation, interest on any amount payable to a third party as a
result of the foregoing), and any legal, accounting, auditing, consulting or other expenses
reasonably incurred in connection with investigating or defending any claims, actions or
proceedings, whether or not resulting in any liability, or enforcing any right to indemnification
under Article 11, actually incurred by an Indemnitee in connection with the matters
described in Section 11.2 or 11.3, as the case may be; provided,
however, that the term “Loss” shall not be deemed to include lost profits, opportunity
costs, any other consequential damages or punitive damages except to the



9









 







extent that, in connection with a Third Party Claim, any such profits, opportunity costs,
consequential damages or punitive damages are incurred or suffered by a third party and are
included in a judgment awarded to, or a settlement or compromise obtained by, such third party.



     “Loss Threshold” has the meaning set forth in Section 11.4(a) of this
Agreement.



     “Naperville Branch” has the meaning set forth in Section 6.21 of this
Agreement.



     “New Loan” has the meaning set forth in Section 6.18 of this Agreement.



     “Non-Conforming Loan” means any Loan acquired under this Agreement as to which Buyer
shall have determined in its reasonable good faith judgment not later than the Cut-Off Date is or
constitutes a Loan:




     (i) that is fraudulent in nature as a result of any intentional act or omission taken
by any Person at anytime on or prior to the Closing Date;




     (ii) as to which any one or more of the representations or warranties made by Seller
under this Agreement in respect of such Loan shall have been inaccurate or untrue; or




     (iii) that should not constitute a “Loan” on account of any of the circumstances
described in any of clauses (i) through (vi) of the proviso to the definition of Loans set
forth in Article 1 of this Agreement.



     “Non-Conforming Loan Closing Date” has the meaning set forth in Section 2.6 of
this Agreement.



     “Non-Conforming Loan Notice” has the meaning set forth in Section 2.6 of this
Agreement.



     “Non-Controlling Party” has the meaning set forth in Section 11.5(d) of this
Agreement.



     “Non-Core Deposit” shall mean certificates of deposit or money market deposit accounts
originated by Seller after the date of this Agreement that had a rate of interest (i) greater than
1.5% on the date of origination, in the case of certificates of deposits or money market deposit
accounts with a maturity of one (1) year or less, and (ii) greater than 1.75% on the date of
origination, in the case of certificates of deposits or money market deposit accounts with a
maturity of more than one (1) year.



     “Non-disclosure Agreement” means the letter agreement dated August 19, 2009 between
Hovde Financial, Inc. and FirstMerit Bank, N.A.



     “Non-Divested Branches” means all of the banking branches of Seller in any
jurisdiction, other than the Branches.



     “Notice of Disagreement” has the meaning set forth in Section 2.2(c) of this
Agreement.



10









 





     “Notice Period,” as applied to any Third Party Claim for which an Indemnitee seeks to
be indemnified pursuant to this Agreement, shall mean the period ending the earlier of the
following:




     (a) sixty (60) days after the time at which the Indemnitee has either (i) received
notice of the facts giving rise to such Third Party Claim, or (ii) commenced an active
investigation of circumstances likely to give rise to such Third Party Claim and, in the
case of clause (ii), where such Indemnitee believes or should reasonably believe that such
facts or circumstances would give rise to such Third Party Claim for which such Indemnitee
would be entitled to indemnification pursuant to this Agreement; and




     (b) sixty (60) days after the time at which any Third Party Claim against the
Indemnitee has become the subject of Proceedings before any court or tribunal or other
decision-making body, or such shorter time as would allow the Indemnifying Party sufficient
time to contest, on the assumption that there is an arguable defense to such Third Party
Claim, such Proceeding prior to any judgment or decision thereon.



     “Objectionable Title Matter” has the meaning set forth in Section 6.13 of this
Agreement.



     “OCC” means the Office of the Comptroller of the Currency.



     “Order” means any cease or desist order, written agreement, memorandum of
understanding, decision, injunction, judgment, order, ruling, subpoena or verdict entered, issued,
made or rendered by any court, administrative agency or other Governmental Body or by any
arbitrator.



     “Ordinary Course of Business” shall mean an action taken by a Person if:




     (a) such action is consistent with the past practices of such Person and is taken in
the ordinary course of the normal day-to-day operations of such Person;




     (b) if the Person is a corporation, bank, partnership, limited liability company or any
other entity of any nature, such action is not required to be authorized by the board of
directors of such entity (or by any Person or group of Persons exercising similar authority)
and is not required to be authorized by the shareholders or other equity owners (if any) of
such entity; and




     (c) such action is similar in nature and magnitude to actions customarily taken in the
ordinary course of the normal day-to-day operations of other Persons that are in the same
line of business of and of similar size to such Person.



     “Overdraft Items” has the meaning set forth in Section 7.2(e) of this
Agreement.



     “Owned Location” has the meaning set forth in Section 6.13 of this Agreement.



     “Owned Real Property” has the meaning set forth in Section 4.11(a) of this
Agreement; provided, however, that, for the avoidance of doubt, the Owned Real
Property shall not include, and Buyer shall not be purchasing from Seller under this Agreement, the
real property owned by



11









 







Seller associated with the closed branch located at 2356 S. Kedzie, Chicago, Illinois (Little
Village) or Lot 3 of the Vineyard of Frankfort, or 12505 S. Ridgeland Avenue, Palos Heights,
Illinois.



     “Par Value” means, with respect to any Non-Conforming Loan as of any date of
determination, the unpaid principal amount of such Non-Conforming Loan plus all accrued or earned,
but unpaid, interest and fees thereon.



     “Parties” has the meaning set forth in the preface above.



     “Payment Amount” has the meaning set forth in Section 2.2(a) of this
Agreement.



     “Permitted Encumbrances” means any exceptions to good and marketable title to the
Owned Real Property (i) which is not an Objectionable Title Matter or (ii) to which Buyer in its
sole discretion shall consent in writing prior to the Closing to accept as a permitted exception to
good and marketable title.



     “Person” means an individual, a partnership, a corporation, a limited liability
company, an association, a joint stock company, a joint venture, an unincorporated organization, or
a Governmental Body.



     “Phase I Environmental Assessment” means an environmental assessment that is intended
to be consistent with ASTM E 1527-05 and/or the federal “All Appropriate Inquiries” Rule found at
40 C.F.R. Part 312.



     “Phase I Environmental and Hazardous Materials Assessment” has the meaning set forth
in Section 6.15 of this Agreement.



     “Phase II Environmental Assessment” means an environmental investigation, including
but not limited to invasive sampling and chemical analyses, that further evaluates previously
identified Recognized Environmental Conditions (“RECs”), including historic RECs.



     “Potential Employees” has the meaning set forth in Section 6.7(a) of this
Agreement.



     “Pre-Closing Balance Sheet” means an unaudited balance sheet listing the assets and
liabilities of the Branches (as of the last day of the immediately preceding month end prior to the
Closing Date) prepared in accordance with generally accepted accounting principles applied on a
basis consistent with prior periods to be prepared by Seller and delivered to Buyer on or before
the fifth (5th) Business Day prior to the Closing Date.



     “Pre-Closing Environmental Liability” has the meaning set forth in Section
2.1(d)(ii) of this Agreement.



     “Pre-Closing Event Liability” means, with reference to any item and whether or not any
of the acts, omissions, circumstances, events, violations, breaches or other matters described in
the following clauses are now or hereafter known, all obligations and Liabilities arising out of or
relating to (i) any breach of or noncompliance with any Contract to the extent such breach or
noncompliance arises out of any act, omission, circumstance or event attributable to the period



12









 







prior to the Effective Time, (ii) any Proceeding to the extent such Proceeding arises out of
any act, omission, circumstance or event attributable to the period prior to the Effective Time,
(iii) any violation of or noncompliance with any Applicable Law to the extent such violation or
noncompliance arises out of any act, omission, circumstance or event attributable to the period
prior to the Effective Time, (iv) any fraudulent or criminal activity or conduct or other wrong
doing on the part of Seller or any of its employees or agents at any time on or prior to the
Effective Time (or, in the case of a Retained Employee, at any time prior to the time such Retained
Employee shall become an employee of Buyer), (v) any violation of any express policy or standard
(including any underwriting standard) of Seller with respect to the origination, renewal, waiver,
forbearance, extension, renewal, amendment, modification of, or release of any collateral or
guaranty collateralizing or guarantying, any Loan, (vi) any data or security breach or other
misappropriation of customer data or information attributable to any period prior to the Effective
Time, and (vii) Seller Taxes.



     “Pre-Closing Tax Period” means a taxable period or portion thereof that ends on or
prior to the Closing Date; if a taxable period is a Straddle Period, then the portion of the
Straddle Period that ends on and includes the Closing Date shall constitute the Pre-Closing Tax
Period.



     “Proceeding” means any action, arbitration, audit, proceeding, oversight,
investigation, litigation, or suit (whether civil, criminal, administrative, investigative, or
informal) commenced brought, conducted, or heard (or capable of being heard) by or before, or
otherwise involving, any Governmental Body or arbitrator, involving the Branches, the Acquired
Assets or the Assumed Liabilities.



     “Real Estate Interests” means the Owned Real Property and the Leased Real Property.



     “Reclaimed Amount” has the meaning set forth in Section 7.2(c) of this
Agreement.



     “Recognized Environmental Condition” or “REC” has the meaning set forth in
ASTM E 1527-05 Section 3.2.74.



     “Regulatory Approvals” means the following approvals required to consummate the
Acquisition: the approval of the OCC, the United States Department of Justice, the Division of
Banking of Illinois Department of Financial & Professional Regulation, and the Missouri Division of
Finance.



     “Rejected Branch” means any Branch that Buyer has excluded from the Acquisition as
contemplated by, and pursuant to, Section 6.12 (which relates to Landlord Consents),
Section 6.13 (which relates to title insurance and land surveys), Section 6.15
(which relates to environmental liabilities) or Section 6.21 (which relates to the
Naperville Branch) of this Agreement.



     “Rejected Branch Deposits” means, collectively, all Deposits of the Rejected Branches.



     “Retained Employees” has the meaning set forth in Section 6.7(b) of this
Agreement.



     “Safe Deposit Business” means the maintenance of all necessary facilities for the use
of safe deposit boxes by the renters thereof, subject to the provisions of the applicable leases or



13









 







other agreements relating to such boxes, and the safekeeping of items maintained by the
Acquired Branches for the benefit of its customers, pursuant to applicable safekeeping agreements,
memoranda or receipts.



     “Safe Deposit Contracts” means all customer agreements, leases, and maintenance
agreements related to the Safe Deposit Business.



     “SBA” means the United States Small Business Administration.



     “SBA Consent” means all consents necessary to transfer to Buyer the SBA Loans.



     “SBA Loan” means any Loan that is guaranteed by the SBA or otherwise made pursuant to
the small business loan program of, or administered by, the SBA.



     “Select Remote Employees” means those employees of Seller listed on Schedule 1.2
hereto.



     “Seller” has the meaning set forth in the preface above.



     “Seller Documents” means this Agreement and each other agreement, instrument or
document entered into by Seller pursuant to this Agreement.



     “Seller Indemnitees” has the meaning set forth in Section 11.3 of this
Agreement.



     “Seller Material Adverse Effect” means, with respect to Seller, any condition, event,
change or occurrence that, individually or collectively, is reasonably likely to have a material
adverse effect upon (i) the condition, financial or otherwise, properties, business, assets,
deposits, earnings or results of operations or cash flows of the Branches, the Acquired Assets or
the Assumed Liabilities, or (ii) the ability of Seller to perform its obligations under, or to
consummate the transactions contemplated by, this Agreement.



     “Seller Taxes” has the meaning set forth in Section 2.1(d)(i) of this
Agreement.



     “SNDAs” has the meaning set forth in Section 6.19 of this Agreement.



     “Special Acceptance Notice” has the meaning set forth in Section 6.18 of this
Agreement.



     “Straddle Period” means any taxable period beginning on or prior to and ending after
the Closing Date.



     “Subpoenas” has the meaning set forth in Section 7.12 of this Agreement.



     “Supplemental Closing” has the meaning set forth in Section 2.5(c) of this
Agreement.



     “Supplemental Closing Date” has the meaning set forth in Section 2.5(c) of
this Agreement.



     “Taxes” has the meaning set forth in Section 4.4(f) of this Agreement.




14












 





     “Tax Claim” has the meaning set forth in Section 11.5(d) of this Agreement.



     “Tax Returns” has the meaning set forth in Section 4.4(f) of this Agreement.



     “Tenant Leases” has the meaning set forth in Section 4.11(a) of this
Agreement.



     “Third Party Claims” means any and all Losses which arise out of or result from (a)
any claims or actions asserted against an Indemnitee by any Person not a party to this Agreement,
(b) any rights of any Person not a party hereto asserted against an Indemnitee, or (c) any
Liabilities of, or amounts payable by, an Indemnitee to any Person not a party hereto arising out
of clause (a) or (b), including, without limitation, claims or actions asserted against an
Indemnitee by any taxing authority on account of Taxes.



     “Transfer Taxes” has the meaning set forth in Section 2.4(f) of this
Agreement.



     “Transferred Records” has the meaning set forth in Section 7.6(a) of this
Agreement.



ARTICLE 2

PURCHASE AND SALE




     2.1 The Acquisition.




     (a) The Acquired Assets. As of the Effective Time, upon the terms and
conditions set forth herein, Seller will sell, assign, transfer, convey and deliver to
Buyer, and Buyer shall purchase from Seller, all of Seller’s rights, title and interests in,
to and under all of the following loans, properties, contracts and other assets, whether now
existing or hereafter acquired, free and clear of all Encumbrances other than the Permitted
Encumbrances (collectively, the “Acquired Assets”):




     (i) all cash on hand (including all ATM cash, petty cash and teller cash), cash
held in the vaults and other cash items or cash equivalents, in each case held at
the Branches as of the Closing Date;




     (ii) except for those items that constitute Excluded Tangible Personal
Property, all of the tangible personal property of Seller located in or at, or
affixed to the premises of, the Acquired Branches, including trade fixtures,
shelving, furniture, on-premises ATMs, equipment (including all televisions,
Bloomberg terminals, cell phones and PDAs used by the Retained Employees), security
systems, safe deposit boxes (exclusive of contents), vaults, copier paper, all signs
(including signs with Seller’s name or logo but excluding all logo boxes and channel
letter sets) and sign framing, structures, posts and other signage infrastructure,
and all non-logo office supplies (collectively, the “Acquired Tangible Personal
Property”);




     (iii) lists of borrowers, depositors and other customers of the Branches to the
extent relating to any Acquired Asset or Assumed Liability, lists of prospective
customers of the Branches, and any other information (including
confidential information) of Seller relating to the Branches that is necessary
for



15









 







Buyer to possess in connection with its administration, ownership and use of any
Acquired Asset or Assumed Liability (the “Acquired Intellectual Property”);




     (iv) all Acquired Owned Real Property;




     (v) all Leases other than the Excluded Leases, if any (the “Acquired
Leases”), together with all Leased Real Properties other than the Excluded
Leased Real Properties, if any (the “Acquired Leased Real Properties”);




     (vi) all Leasehold Improvements in respect of all Leases other than the
Excluded Leases (the “Acquired Leasehold Improvements”);




     (vii) all (A) Safe Deposit Contracts, and (B) (1) all equipment leases relating
to the lease of equipment located at the Acquired Branches and related maintenance
agreements, and (2) all other contracts, in each case as to subclause (1) and (2) of
this clause (vii) solely to the extent listed on Schedule 2.1(a)(vii)(B)
attached hereto other than any such equipment leases and other contracts that Buyer
has elected to remove from such Schedule 2.1(a)(vii)(B) by giving written
notice of such election to Seller not later than thirty (30) days following the date
hereof, in which case such Schedule delivered on the date hereof, as so modified by
such election notice, shall be deemed to constitute Schedule 2.1(a)(vii)(B)
for all purposes of this Agreement (the leases and contracts listed on Schedule
2.1(a)(vii)(B), collectively, the “Acquired Contracts”);




     (viii) all Loans and servicing rights with respect thereto, including (A) all
(1) collateral pledged as collateral security therefor, (2) guaranties and other
instruments of credit support issued in favor of the Seller as a guaranty or credit
support thereof and (3) monies held by Seller in escrow for taxes, insurances,
special assessments or other purposes in respect of such Loans, and (B) all related
loan documents and instruments and promissory notes, collateral documents, guaranty
and other credit support instruments or agreements and other documents evidencing,
governing or in respect of such Loans;




     (ix) all rights of Seller relating to pre-paid expenses associated with the
foregoing Acquired Assets or any of the Deposits, including an appropriately
pro-rated portion of any pre-paid FDIC deposit insurance assessment, as contemplated
by Section 2.4 hereof; and




     (x) without limiting any other provision contained in this Section
2.1(a), all Books and Records relating to any of the foregoing Acquired Assets
or any of the Assumed Liabilities.




     (b) The Excluded Assets. Seller shall not sell and transfer and shall retain,
and Buyer shall not purchase or acquire, all of the following assets and properties of
Seller, as follows (collectively, the “Excluded Assets”):




     (i) all (A) paper stock, forms and other supplies containing any logos, trade
name, trademark or service mark, if any, of Seller, other than all signage,



16









 







(B) desk
top and lap top computers, computer monitors and computer servers of Seller, and (C)
the specific items of tangible personal property in or at, or affixed to the
premises of, the Branches listed on Schedule 2.1(b)(i) hereof (all such
items, as the same may be adjusted for inclusion in the Acquired Assets pursuant to
Section 6.22 hereof, collectively, the “Excluded Tangible Personal
Property”);




     (ii) except for the Acquired Intellectual Property, all of Seller’s computer
software programs, trade secrets, registered or common law trademarks or trade
names, corporate logos and other intellectual property rights, including the name
“First Bank” (collectively, the “Excluded Intellectual Property”);




     (iii) the (A) Excluded Owned Real Property, if any, and (B) the Excluded
Leases, if any, together with the Excluded Leased Real Properties in respect
thereof;




     (iv) all loans, loan participation interests, Commitments, overdrafts and
similar items of the Branches, other than the Loans (the “Excluded Loans”);




     (v) all of Seller’s right to recover assets charged off by Seller prior to the
Closing;




     (vi) all items of real estate that are classified as “other real estate owned”
of the Branches on the books and records of Seller;




     (vii) Seller’s credit card portfolio;




     (viii) foreclosed or repossessed personal property of customers of the
Branches, except to the extent any thereof shall constitute collateral for the
Loans;




     (ix) all assets, Contracts (including Safe Deposit Contracts) and properties of
Seller in respect of the Rejected Branches (other than (A) the Books and Records
relating to the Loans and Deposits of such Rejected Branches, (B) the Loans (and
other items contemplated by Section 2.1(a)(viii)) of such Rejected Branches,
and (C) the cash and other cash items of the Branches included in the Acquired
Assets pursuant to Section 2.1(a)(i) hereof);




     (x) all assets, rights and interests of Seller relating to the Branches in
respect of Fiduciary Relationships, except for the Deposits in respect of IRAs and
Keogh Accounts included in the Acquired Assets or Assumed Liabilities as
contemplated by Section 6.20 hereof;




     (xi) records of Seller not included in the Acquired Assets or that are
otherwise not required to be delivered to Buyer pursuant to any other provision of
this Agreement; and




     (xii) any other assets or properties of Seller not included in the Acquired
Assets, including all Non-Divested Branches of Seller.



17









 






     (c) The Assumed Liabilities. Subject to the terms and conditions hereof, from
and after the Effective Time, Seller will transfer to Buyer, and Buyer shall assume, pay,
perform and discharge and indemnify Seller in accordance with Article 11 hereof with
respect to, the following (and only the following) obligations and liabilities of Seller to
the extent required to be paid, performed, satisfied or discharged from and after the
Effective Time (collectively, the “Assumed Liabilities”):




     (i) all of Seller’s obligations and liabilities with respect to the Acquired
Contracts and the Acquired Leases, other than any Pre-Closing Event Liability
relating to or in respect of such Acquired Contracts or Acquired Leases;




     (ii) all of Seller’s obligations and liabilities with respect to the Deposits,
other than any Pre-Closing Event Liability relating to or in respect of such
Deposits;




     (iii) all of Seller’s obligations and liabilities with respect to the
Commitments, other than any Pre-Closing Event Liability relating to or in respect of
such Commitments; and




     (iv) in the event that the Phase I Environmental and Hazardous Materials
Assessment or Phase II Environmental Assessment with respect to a single Branch
confirms the existence of a condition in violation of applicable Environmental Laws,
the presence of asbestos, or the presence of any other Hazardous Materials in excess
of industrial/commercial remediation standards and such condition was not disclosed
or identified on Schedule 4.9(a) or 4.9(g) or in the documents (or
attachments to the documents) referenced on Schedule 4.9(a) or
4.9(g), the remediation costs of up to $25,000 for all Real Estate Interests
relating to such single Branch, as contemplated by Section 6.15 hereof.




     (d) The Excluded Liabilities. Notwithstanding anything to the contrary
contained in this Agreement, Buyer shall not assume or be bound by any duties,
responsibilities, obligations or Liabilities of Seller relating to Seller or arising out of
the Acquired Assets, the Excluded Assets, the Deposits or the Branches, of any kind or
nature and whether known, unknown, contingent or otherwise, other than the Assumed
Liabilities (all such duties, responsibilities, obligations and Liabilities, other than the
Assumed Liabilities, the “Excluded Liabilities”), including the following:




     (i) any (A) Taxes imposed on Seller for any period, (B) Taxes imposed with
respect to the Acquired Assets or the Deposits, or the operation of the Acquired
Branches, for any Pre-Closing Tax Period, (C) Transfer Taxes to the extent of the
amount allocated to Seller pursuant to Section 2.4(f) hereof, and (D) Taxes
imposed on Buyer or any of its Affiliates as a successor or transferee of Seller
(collectively, the “Seller Taxes”);




     (ii) subject to the provisions of Section 2.1(c)(iv) and Section
11.4(d) hereof, all Liabilities (A) imposed on Buyer with respect to or in
respect of the Real Estate Interests arising under any Environmental Law to the
extent arising



18









 







out of or relating to any release, violation of Applicable Law,
event, condition, action, omission or other circumstance attributable to any period
on or prior to the Closing Date, including any claims, penalties, remediation costs,
Liabilities arising from the emission, discharge release or disposal of any
Hazardous Materials into the air, ground or water or the presence of any Hazardous
Materials on, at or in any Branches or any real property included in the Acquired
Assets, and (B) without limiting the provisions of clause (A) above, all Liabilities
imposed on Buyer with respect to or in respect of the Real Estate Interests arising
out of any underground storage tank located in, or asbestos located in any building
upon, any Real Estate Interests at anytime on or prior to the Closing Date, whether
or not such Liability shall arise prior to or after the Closing Date, including,
without limitation, in the case of each of clause (A) and clause (B), all such
Liabilities arising out of any environmental event or condition disclosed on
Schedules 4.9(a) and 4.9(g) hereof or in the documents (or the
attachments to the documents) referenced on Schedules 4.9(a) and
4.9(g) hereof; provided, however, that (1) Seller shall not
be responsible for any Liabilities under this clause (ii) arising under any
Environmental Law to the extent such Liabilities are caused by (X) Buyer’s changed
use of any Real Estate Interests following the Closing Date, (Y) changes made by
Buyer to any structures on any Real Estate Interest following the Closing Date, or
(Z) exacerbation of any underlying condition by the acts or omissions of Buyer
following the Closing Date (and all environmental Liabilities for which Seller shall
be responsible to the extent provided in this Section 2.1(d)(ii) are
referred to herein as, collectively, the “Pre-Closing Environmental
Liabilities”), and (2) Seller’s obligation to indemnify Buyer for the Excluded
Liabilities described in this clause (ii) shall survive for a period of only eight
(8) years following the Closing Date as provided in Section 11.1 hereof;




     (iii) all Liabilities arising out of or relating to the employment by Seller of
any employee, including any former employee and any Retained Employee, including all
salary, bonus, change of control and other obligations arising under or out of any
employment agreement between Seller (or any Affiliate thereof) and any such employee
(including any Retained Employee);




     (iv) all Liabilities arising out of or relating to all employee benefit plans,
agreements or arrangements, as described in Section 4.5 hereof, of or
maintained by Seller or at anytime as to which Seller contributed or had any
Liability;




     (v) all account, trade and note payables of Seller with respect to the
Branches; and




     (vi) all Liabilities arising out of the ownership or operation of the Branches
or their respective business or properties or assets (including the
Acquired Assets and Deposits) on or prior to the Closing Date, including the
Liabilities arising out of the Proceedings listed on Schedule 4.7(a) hereof.



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     2.2 Consideration for the Acquisition.




     (a) In consideration for the Acquisition, Seller shall make available and transfer to
Buyer, or Buyer shall make available and transfer to Seller, the Payment Amount in
accordance with this Section 2.2. The “Payment Amount” means an amount
equal to the sum of the aggregate balance of all the Deposits (as set forth on the
Acquisition Closing Date Balance Sheet) including interest posted or accrued with respect to
the Deposits as of the close of business on the Closing Date, less an amount equal to the
sum of:




     (i) A premium for the Deposits and franchise value relating to the Branches
equal to 3.5% of the average Deposit balances of the Branches for the thirty (30)
calendar days immediately preceding and including the Closing Date;
provided, however, that (A) Non-Core Deposits (to the extent
included in the Deposits), and (B) all Rejected Branch Deposits shall, in each case,
be excluded from such Deposits for purposes of the calculation of average Deposit
balances;




     (ii) The amount held as cash and cash items of the Branches as reflected on the
Acquisition Closing Date Balance Sheet;




     (iii) The Book Value of all Loans, including accrued interest as reflected on
the Acquisition Closing Date Balance Sheet;




     (iv) The Book Value of Acquired Owned Real Property;




     (v) The Book Value of the Acquired Tangible Personal Property and Leasehold
Improvements as reflected on the Acquisition Closing Date Balance Sheet; and




     (vi) Buyer’s share of the pro rata adjustment of items required pursuant to
Section 2.4.




     (b) On the Closing Date, (i) Seller shall deliver to Buyer an amount estimated to be
the Payment Amount, calculated as set forth in clause (a) of this Section 2.2 off of
the balances reflected on the Acquisition Pre-Closing Balance Sheet (the “Estimated
Payment Amount”) if the Estimated Payment Amount is a positive number, and (ii) Buyer
shall deliver to Seller the absolute value of the Estimated Payment Amount if the Estimated
Payment Amount is a negative number. The Estimated Payment Amount shall be set forth in a
statement prepared as of the date of the Acquisition Pre-Closing Balance Sheet and delivered
to Buyer at least two (2) Business Days prior to the Closing Date (such statement, the
“Estimated Payment Amount Statement”).




     (c) Within ten (10) Business Days following the Closing Date, Seller shall prepare and
deliver to Buyer the Acquisition Closing Date Balance Sheet, together with a statement
prepared as of the close of business on the Closing Date showing the Payment
Amount and reconciling the Payment Amount to the Estimated Payment Amount (such
statement, the “Final Payment Amount Statement”). Within twenty (20) Business Days
after receipt of delivery of the Acquisition Closing Date Balance Sheet and the Final
Payment Amount Statement, Buyer may dispute all or any portion of the Acquisition Closing
Date Balance Sheet and the Final Payment Amount Statement by giving written



20









 







notice (a
“Notice of Disagreement”) to Seller setting forth in reasonable detail the basis for
any such dispute (a “Disagreement”). Seller shall provide Buyer and its designees
with full reasonable access, during normal business hours, to relevant books, records, work
papers, personnel and representatives of Seller and such other information as Buyer may
reasonably request in connection with its review of the Acquisition Closing Date Balance
Sheet and the Final Payment Amount Statement and with respect to the resolution of any
Disagreement. The Parties shall promptly commence good faith negotiations with a view to
resolving all such Disagreements. Subject to Sections 2.5(e) and 2.5(f), if
Buyer does not give a Notice of Disagreement within the twenty (20) Business Day period set
forth above, Buyer shall be deemed to have irrevocably accepted such Acquisition Closing
Date Balance Sheet and the Final Payment Amount Statement in the form delivered to Buyer by
Seller. Seller shall be deemed to have irrevocably accepted the Acquisition Closing Date
Balance Sheet and the Final Payment Amount Statement as modified by and disclosed in Buyer’s
Notice of Disagreement if Seller does not dispute all or any portion of such Notice of
Disagreement by giving its written response to Buyer within ten (10) Business Days following
the delivery of such Notice of Disagreement setting forth in reasonable detail the basis for
its dispute.




     (d) In the event that a dispute arises as to the appropriate amounts to be paid to
either Party pursuant to the Acquisition Closing Date Balance Sheet and the Final Payment
Amount Statement discussed in subsection (c), each Party shall pay to the other all amounts
other than those as to which a dispute exists. The Parties shall refer the disputed amounts
to an independent firm of certified public accountants of national standing (an
“Accountant”) reasonably acceptable to Buyer and Seller, and Buyer and Seller agree
to be bound by the determination of such firm with respect to such disputed matters (absent
manifest error). Buyer and Seller shall agree upon an Accountant within fourteen (14)
calendar days after the date on which either Buyer or Seller notifies the other in writing
that the referral of a disputed matter within the scope of this Section 2.2(d) is
necessary. If Buyer and Seller shall fail to agree on an Accountant within such fourteen
(14) day period, then Buyer and Seller shall each choose an accountant who will mutually
select a third qualifying accountant who shall be the Accountant for purposes of this
Section 2.2(d). Buyer and Seller agree to share equally the fees and charges of the
Accountant appointed hereunder for its services in resolving disputes within the scope of
this Section 2.2(d).




     (e) The provisions of Section 2.2(d) are not intended to and shall not be
interpreted to require that the Parties refer to an Accountant (a) any dispute arising out
of a breach by one of the Parties of its obligations under this Agreement, (b) any dispute
the resolution of which requires a construction or interpretation of this Agreement other
than this Section 2.2 and the definitions related hereto and any other Section of
this Agreement as necessary to enable the Accountant to resolve the dispute submitted to it
pursuant to this Section 2.2, or (c) any other dispute other than (in the case of
this clause (e)) a
dispute related to the mathematical calculation of the Payment Amount or the accounting
treatment of any asset or liability, or item of income or expense, that affects the
calculation of the Payment Amount, or both. The Parties reserve all rights and remedies,
including at law or in equity, to resolve disputes other than those within the scope of
Section 2.2(d).



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     (f) Any disputed amounts retained by a Party that are later found to be due to the
other Party shall be paid to such other Party promptly upon resolution with interest thereon
from the Closing Date to the date paid at the applicable Federal Funds Rate.



     2.3 Allocation.




     (a) No later than thirty (30) calendar days after the determination of the Acquisition
Closing Date Balance Sheet and the Final Payment Amount Statement (including the final
resolution of any dispute related thereto pursuant to Section 2.2(d)), Buyer shall
prepare and deliver to Seller a draft of a statement (the “Draft Allocation
Statement”) setting forth the allocation of the total consideration paid by Seller to
Buyer pursuant to this Agreement among the assets acquired pursuant to this Agreement for
purposes of, and in accordance with, Section 1060 of the Code. If, within forty-five (45)
calendar days of the receipt of the Draft Allocation Statement, Seller shall not have
objected in writing to such draft, the Draft Allocation Statement shall become the Final
Allocation Statement, as defined below. If Seller objects to the Draft Allocation Statement
in writing within such 45-day period, Seller and Buyer shall negotiate in good faith to
resolve any disputed items. If, within ninety (90) calendar days after the receipt of the
Draft Allocation Statement, Seller and Buyer fail to agree on such allocation, any disputed
aspects of such allocation shall be resolved by an Accountant in accordance with the
procedures set forth in Section 2.2(d). The allocation of the total consideration,
as agreed upon by Seller and Buyer (as a result of either Seller’s failure to object to the
Draft Allocation Statement or of good faith negotiations between Seller and Buyer) or
determined by the Accountant (the “Final Allocation Statement”) shall be final and
binding upon the parties hereto. If there is any adjustment to the consideration paid by
Seller to Buyer pursuant to this Agreement for purposes of Section 1060 of the Code, any
such adjustment shall be allocated, to the extent possible, to the asset(s) resulting in
such adjustment, and Buyer shall prepare a revised Draft Allocation Statement reflecting
such adjustment which shall, subject to the review and dispute resolution provisions set
forth in this Section 2.3(a), replace the Final Allocation Statement. Each of
Seller and Buyer shall bear all fees and costs incurred by it in connection with the
determination of the allocation of the total consideration, except that the Parties shall
each pay one-half (50%) of the fees and expenses of the Accountant retained to resolve any
disputed aspects of the allocation prepared pursuant to this Section 2.3(a).




     (b) Seller and Buyer shall report the transaction contemplated by this Agreement for
federal and other applicable income Tax purposes (including income Tax reporting
requirements imposed pursuant to Section 1060 of the Code) in accordance with the allocation
specified in the Final Allocation Statement (including any adjustment thereof). Each of
Seller and Buyer agree to timely file, or cause to be timely filed, IRS Form 8594 (and any
comparable form under state or local Tax law and including any
amendment thereto) and any required attachment thereto in accordance with the Final
Allocation Statement and provide the other Party with a copy of each such form as filed no
later than ten (10) calendar days following the filing thereof. Except as otherwise
required pursuant to a “determination” under Section 1313 of the Code (or any comparable
provision of state or local Tax law), neither Seller nor Buyer shall take, or shall permit
its Affiliates to take, a Tax position which is inconsistent with the Final



22









 







Allocation
Statement (including any adjustment thereof). In the event any Party receives notice of an
audit in respect of the allocation of the consideration paid for the Acquired Assets, such
Party shall promptly notify the other Party in writing as to the date and subject of such
audit.



     2.4 Pro Rata Adjustment and Reimbursement.




     (a) Unless otherwise provided herein, it is the intention of the Parties that Seller
will operate the Branches for its own account until the Effective Time and that Buyer shall
operate and hold the Acquired Assets and assume the Assumed Liabilities for its own account
after the Effective Time. Thus, except as otherwise specifically provided herein, items of
proration and other adjustments shall be prorated as of the Effective Time and settled
between Seller and Buyer as contemplated by Section 2.2 hereof whether or not such
adjustment would normally be made as of such time; provided, however, that
items of proration and other adjustments allocated to Buyer shall be allocated to Buyer
solely to the extent such items shall apply to the Acquired Assets or the Deposits. Items
of proration and adjustment will be handled at Closing as an adjustment to the amount of
funds to be delivered by Seller to Buyer, or Buyer to Seller, as appropriate, as
contemplated by Section 2.2 hereof.




     (b) For purposes of this Agreement, items of proration and other adjustments with
respect to the Acquired Assets and the Deposits shall include, without limitation: (i)
personal and general real property taxes; (ii) FDIC deposit insurance assessments and
prepayments; (iii) safe deposit rental payments; (iv) rent for any Acquired Leased Real
Property, and (v) other prepaid expenses and items (including security deposits), if any, as
of the Effective time on the Closing Date. To the extent that the amount of the foregoing
items is not known on the Closing Date, such proration shall be based on the amount of such
items for the prior month or year, as appropriate; provided, however, the
Parties shall apportion all general real estate taxes as provided in paragraph (c) below.




     (c) Buyer and Seller shall apportion pro rata all general real estate taxes (state,
county, municipal, school and fire district) paid or payable in connection with the Acquired
Owned Real Property and any special taxes or assessments, if any, upon the Acquired Owned
Real Property assessed or becoming a lien in accordance with Section 2.4(e) hereof.
Such apportionment shall be based upon the fiscal year for which the same are assessed. In
the event that the applicable Tax bill, or other information reasonably necessary for
computing any such apportionment, is not available on the Closing Date, the apportionment
shall be made at Closing on the basis of the prior period’s general real estate taxes, and
such apportionment shall thereafter be reconciled based on the final Tax bill as set forth
in the remaining provisions of this clause (c). Within thirty (30) days after receipt by
the Parties of the applicable final Tax bill or other information reasonably
necessary for computing such apportionment, Buyer and Seller shall apportion the actual
general real estate taxes and, if either Party paid more than its proper share thereof at
Closing, the other Party shall within seven (7) Business Days after written request
therefore reimburse such Party for the amount so expended.



23









 






     (d) Notwithstanding anything to the contrary, to the extent that the FDIC imposes an
assessment (special or otherwise) after the Closing Date, which assessment is applicable to
deposits that were attributable to the Deposits prior to the Closing Date, then such
assessment shall be appropriately apportioned between Seller and Buyer after the Closing
Date within five (5) Business Days after payment of such assessment.




     (e) For purposes of this Agreement, in the case of any Straddle Period, (1) general
real estate taxes for the Pre-Closing Tax Period shall be equal to the amount of such
general real estate taxes for the entire Straddle Period multiplied by a fraction, the
numerator of which is the number of days during the Straddle Period that are in the
Pre-Closing Tax Period and the denominator of which is the number of days in the entire
Straddle Period, and (2) Taxes (other than general real estate taxes) for the Pre-Closing
Tax Period shall be computed as if such taxable period ended as of the end of the Closing
Date.




     (f) Notwithstanding anything to the contrary contained in the foregoing provisions of
this Section 2.4 or otherwise contained in this Agreement, all excise, sales, use,
transfer, recording and similar Taxes that are payable or that arise as a result of the
consummation of the purchase and sale contemplated by this Agreement (collectively, the
“Transfer Taxes”) shall be borne and, when due, paid one-half by Seller and one-half
by Buyer, whether such Transfer Taxes are imposed on Seller or Buyer.



     2.5 Closing.




     (a) The closing of the Acquisition (the “Closing”) shall occur by facsimile or
PDF, or in person at a mutually convenient location, or by such other method as shall be
mutually agreed to by the Parties, and any Closing documents delivered by facsimile or PDF
at the Closing shall be delivered in original execution form by the Parties by overnight
courier promptly following the Closing. Any executed Closing documents sent by a Party or
its counsel to the other Party or its counsel prior to Closing shall be held in escrow by
such other Party or its counsel until such executed documents are authorized to be released
by a senior officer of the sending Party or by the sending Party counsel. The Closing shall
occur on such date on which the Parties mutually agree but in any event not later than three
(3) Business Days after all conditions precedent to Closing as set forth in Sections
8.1 and 8.2 shall have been satisfied or waived; provided,
however, that unless the Parties shall have otherwise mutually agreed, in no event
shall the Closing occur prior to the latest of (i) ninety (90) days after the date of this
Agreement, (ii) forty-five (45) days after the date on which all Regulatory Approvals shall
have been obtained, and (iii) February 12, 2010 (the date on which the Closing shall have
occurred, the “Closing Date”).




     (b) The effective time of the consummation of the Acquisition (the “Effective
Time”) shall be at a mutually agreeable time after the close of business for the
Branches on the Closing Date.




     (c) Promptly after the Closing Date Balance Sheet and the Final Payment Amount
Statement have been finally determined in accordance with Section 2.2(c), but in



24









 







no
event later than five (5) Business Days following such final determination (the
“Supplemental Closing Date”), the parties hereto shall hold a supplemental closing
(the “Supplemental Closing”), either by telephone, or in person at a mutually
convenient location. On the Supplemental Closing Date, if the Payment Amount is less than
the Estimated Payment Amount, Buyer shall refund to Seller cash having an aggregate value
equal to the difference between the Estimated Payment Amount and the Payment Amount by wire
transfer or other immediately available funds. On the Supplemental Closing Date, if the
Payment Amount is more than the Estimated Payment Amount, Seller shall deliver to Buyer, by
wire transfer or other immediately available funds, an amount equal to the difference
between the Payment Amount and the Estimated Payment Amount.




     (d) The post-closing settlement payment shall not bear interest.




     (e) In the event any bookkeeping omissions or errors are discovered in preparing the
Acquisition Closing Date Balance Sheet for the Branches or in completing the transfer and
assumptions contemplated hereby, the Parties agree to correct such errors and omissions, it
being understood that no adjustments will be made that are inconsistent with the judgments,
methods, policies, or accounting principles utilized by Seller in preparing and maintaining
the accounting records of the Branches.




     (f) In the event that Buyer or Seller discovers any errors or omissions as contemplated
by Section 2.5(e) above or any error with respect to the payments made under
Section 2.5(c) above not later than six (6) months following the Supplemental
Closing Date, Buyer and Seller agree to promptly correct any such error or omission, make
any payments and effect any transfers or assumptions as may be necessary to reflect any such
correction; provided, that interest shall not be paid with respect to any such
payments.



     2.6 Repurchase of Non-Conforming Loans. If at any time on or prior to the Cut-Off Date Buyer shall have discovered a Non-Conforming
Loan, Buyer may deliver written notice thereof to Seller not later than the Cut-Off Date (any such
notice, a “Non-Conforming Loan Notice”), which notice shall include (i) such documentation
as is reasonably available to Buyer in support of its discovery, and (ii) a statement of the then
current Par Value of such Non-Conforming Loan. If Buyer shall have given a Non-Conforming Loan
Notice on or prior to the Cut-Off Date, Buyer shall have the right to cause Seller to purchase, and
Seller shall purchase from Buyer, such Non-Conforming Loan at the Par Value thereof as of the
Non-Conforming Loan Closing Date (as defined below); provided that Buyer shall have
represented to Seller as of the Non-Conforming Loan Closing Date that Seller owns such
Non-Conforming Loan as of such date. The closing of the purchase of the Non-Conforming Loan shall
occur on a date specified in the applicable Non-Conforming Loan
Notice, but in no event earlier than three (3) Business Days following Seller’s receipt of
such Non-Conforming Loan Notice (the date of such closing, the “Non-Conforming Loan Closing
Date”). At the closing of the purchase and sale of the Non-Conforming Loan that is the subject
of any Non-Conforming Loan Notice, Buyer and Seller shall enter into such standard loan transfer
documents customary for a loan transfer of this type and without recourse to Buyer, and the
purchase price payable by Seller to Buyer on the applicable Non-Conforming Loan
Closing Date shall
be paid by wire transfer of immediately available funds to the account of Buyer specified by it in
writing to Seller. On the Non-Conforming Loan



25









 








Closing Date in respect of a Non-Conforming Loan,
Buyer shall deliver to Seller all loan documents relating to such Non-Conforming Loan, subject to
Buyer’s retention obligations under applicable directions from law enforcement authorities. The
rights of Buyer hereunder shall be in addition to (but not in duplication of) any rights of Buyer
under Article 11 hereunder, and nothing contained in this Section 2.6 shall be
deemed to imply that a Non-Conforming Loan does not constitute an “Excluded Loan” for all purposes
of this Agreement. Any Non-Conforming Loan purchased by Seller under this Section 2.6
shall be treated as an adjustment to the purchase price paid by Buyer under this Agreement.
Notwithstanding anything to the contrary contained herein, Buyer shall have the right, without the
consent of Seller, to assign and delegate Buyer’s rights and obligations under this Section
2.6 to any Person to whom Buyer shall have sold or otherwise transferred a Non-Conforming Loan;
provided that not later than five (5) Business Days following such assignment and
delegation Buyer shall give written notice thereof to Seller. The Parties agree that Buyer shall
be entitled to specific performance of the obligations of Seller under this Section 2.6 to
the fullest extent permitted by applicable law.



ARTICLE 3

REPRESENTATIONS AND WARRANTIES OF SELLER




     Seller represents and warrants to Buyer that the statements contained in this Article
3 are correct and complete as of the date of this Agreement and will be correct and complete as
of the Closing Date (as though made then as though the Closing Date were substituted for the date
of this Agreement throughout this Article 3).



     3.1 Organization, Qualification, and Corporate Power. Seller is a Missouri state
chartered bank duly organized and validly existing under the laws of Missouri, with full corporate
power and authority to conduct its business as now being conducted and to own or use the properties
and assets that it purports to own or use.



     3.2 Authorization of Transaction. Seller has the full corporate power and authority to
execute and deliver this Agreement and the other Seller Documents. Subject to approval by any
necessary federal or state banking regulatory authority, Seller has the corporate power and
authority to perform Seller’s obligations hereunder and under the other Seller Documents, and to
consummate the transactions contemplated hereby and thereby. Each of this Agreement, and when
executed and delivered, each of the other Seller Documents, constitutes the valid and legally
binding obligation of Seller, enforceable in accordance with its terms and conditions, subject to
bankruptcy, insolvency, reorganization, moratorium, receivership, conservatorship and similar laws
relating to the rights and remedies of creditors, as well as to general principles of equity.
Except for the Regulatory Approvals, the Landlord Consents and such other Consents as are listed on
Schedule 3.2, Seller is not required to give any notice to, make any filing with, or
obtain any authorization or Consent of any third party in order to execute and deliver this
Agreement or consummate the Acquisition, including sale, transfer and assignment of the Acquired
Assets and the Assumed Liabilities. Seller has not received any indication from any federal or
state governmental agency or authority that such agency would oppose or refuse to grant a
Regulatory Approval, and to Seller’s Knowledge, there exists no fact or circumstance that would
prevent or delay Seller’s ability to obtain promptly all Regulatory Approvals.




26












 





     3.3 Noncontravention. Subject to the required Consents described in Section
3.2 and the Landlord Consents, neither the execution and the delivery of this Agreement by
Seller, nor the consummation of the Acquisition by Seller will, directly or indirectly:




     (a) Contravene, conflict with, or result in a violation of (i) any provision of the
articles of incorporation or bylaws of Seller or (ii) any resolution adopted by the board of
directors of Seller;




     (b) Contravene, conflict with, or result in a violation of, or give any Governmental
Body or other Person the right to challenge the Acquisition or to exercise any remedy or
obtain any relief under, any Applicable Law or any Order to which Seller, or any of the
assets or deposits owned or used by Seller, may be subject;




     (c) Except for matters which would not have a Seller Material Adverse Effect,
contravene, conflict with, or result in a violation of the terms or requirements of, or give
any Governmental Body the right to revoke, withdraw, suspend, cancel, terminate or modify,
any Governmental Authorization that is held by Seller or that otherwise relates to the
Branches, the Acquired Assets or the Assumed Liabilities; or




     (d) Except for matters which would not have a Seller Material Adverse Effect,
contravene, conflict with, or result in a violation or breach of any provision of, or give
any Person the right to declare a default or exercise any remedy under, or to accelerate the
maturity or performance of, or to cancel, terminate or modify, any Contract relating to the
Branches to which Seller is a party and included in the Acquired Assets or Assumed
Liabilities.



     3.4 Governmental Authorizations. Seller has all Governmental Authorizations
necessary for the lawful conduct of its business at each of the Branches as now conducted and,
except as would not have a Seller Material Adverse Effect, all such Governmental Authorizations are
valid and in good standing and (i) are not subject to any suspension, modification, revocation, or
pending (or, to the Knowledge of Seller, threatened) proceedings related thereto, and (ii) no event
has occurred or circumstance exists that may give rise to or serve as the basis for the
commencement of any such proceeding.



     3.5 Brokers’ Fees. With the exception of Hovde Financial, Inc., Seller has no
Liability or obligation to pay any fees or commissions to any broker, finder, or agent with respect
to the Acquisition, and Seller shall be solely liable for payment of any such fees or commission to
Hovde Financial, Inc.



ARTICLE 4

REPRESENTATIONS AND WARRANTIES CONCERNING THE BRANCHES




     Seller represents and warrants to Buyer that the statements contained in this Article
4, as qualified by the Disclosure Schedules relating thereto, are correct and complete as of
the date of this Agreement and will be correct and complete as of the Closing Date (as though made
then and as though the Closing Date were substituted for the date of this Agreement throughout this
Article 4, except for statements made as of a specific date, in which case such
representations and warranties were correct and complete as of such specific date).



27









 





     4.1 Title; Tangible Personal Property. Seller has good and marketable title to or,
in the case of any personal property lease, good and marketable leasehold interest in, all of the
Acquired Tangible Personal Property and other Acquired Assets (other than the Owned Real Property
and Leased Real Property, as to which Section 4.11 applies), in each case free and clear of
all Encumbrances. All Tangible Personal Property used by the Branches is in good condition,
reasonable wear and tear excepted, and is usable in the Ordinary Course of Business. Any Acquired
Tangible Personal Property held under lease by Seller is held by Seller under a valid and
enforceable lease with such exceptions as are not material and do not interfere in any material
respect with the use made and proposed to be made of such property by Seller.



     4.2 Deposits.




     (a) Seller has provided to Buyer a true and accurate data file of all deposits
(including IRAs and Keogh Accounts), and related information, which are assigned to the
Branches prepared as of a date within ten (10) days prior to the date of this Agreement,
which data shall be updated at and as of a date first, not earlier than thirty (30) days
prior to the Closing Date and, second, not earlier than five (5) days prior to the Closing
Date to list separately Deposits to be assumed under this Agreement and deposits that are
not being assumed under this Agreement and which data shall be further updated on the date
of delivery to Buyer by Seller of the Acquisition Closing Date Balance Sheet and on the
Supplemental Closing Date, and, in each case as updated, shall be true and accurate as of
such date.




     (b) The Deposits are insured to applicable limits by the FDIC in accordance with the
Federal Deposit Insurance Act, 12 U.S.C. § 1813, and Seller has paid all assessments and
opt-in fees and has filed all reports required to be paid or filed by it to or with the FDIC
concerning the Deposits.




     (c) The Deposits were solicited and currently exist in material compliance with all
applicable requirements of federal laws and regulations promulgated thereunder and to the
extent, if any, that their applicability to Seller is not preempted by federal laws and
regulations, state and local laws and regulations promulgated thereunder (for purposes of
this clause, a Deposit would not be in material compliance if, among other things, the
noncompliance subjects the depository institution to any penalty or liability other than the
underlying liability to pay the Deposit).




     (d) Seller has the right to transfer or assign each of the Deposits to Buyer, subject
to any pledges, liens, judgments, court orders and restrictions on transfer.




     (e) Except as otherwise disclosed by Seller on Schedule 4.2(e) hereof, each of
the agreements relating to the Deposits has been duly authorized, executed, and delivered,
and is valid, binding, and enforceable upon its respective parties in accordance with its
terms except as enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium, or other similar laws affecting creditors’ rights, and by the
exercise of judicial discretion in accordance with general principles applicable to
equitable and similar remedies.



28









 






     (f) Unless otherwise disclosed by Seller on Schedule 4.2(f) hereof, all
agreements relating to the Deposits other than certificates of deposit legally permit Buyer
to unilaterally terminate or modify such agreements within thirty (30) days after the
Closing Date without the consent of the depositor or depositors and without penalty, subject
to applicable law, delivery of any notice as may be specified in such agreements and any
applicable provisions in such agreements.



     4.3 Undisclosed Liabilities. The Branches have no Liabilities except for (a)
Liabilities set forth on the face of the Pre-Closing Balance Sheet (rather than in any notes
thereto), (b) Liabilities which have arisen in the Ordinary Course of Business after the
Pre-Closing Balance Sheet, and (c) Commitments made in the Ordinary Course of Business.



     4.4 Tax Matters.




     (a) With respect to all interest bearing accounts assigned to Buyer, the records of
Seller transferred to Buyer contain all information and documents (including, without
limitation, properly completed Forms W-9) necessary to comply with all information reporting
and Tax withholding requirements under federal and state laws, rules and regulations, and
such records identify with specificity all accounts subject to backup withholding under the
Code.




     (b) All Tax Returns required to be filed on or before the Closing Date by Seller and
its Affiliates with respect to any Taxes payable in respect of the Acquired Assets or
Assumed Liabilities or related to the Branches have been timely filed with the appropriate
governmental agencies in all jurisdictions in which such Tax Returns are required to be
filed and are true and correct in all material respects.




     (c) All Taxes owed by Seller and its Affiliates with respect to the Acquired Assets or
Assumed Liabilities or related to the Branches (whether or not shown on any Tax Return) that
are required have been timely paid in full.




     (d) Seller and its Affiliates have withheld and paid all Taxes required to have been
withheld and paid in connection with any amounts paid to any employee, independent
contractor, creditor, stockholder, or other third party with respect to the Acquired Assets
or the Assumed Liabilities or related to the Branches.




     (e) There are no claims, assessments, levies, administrative proceedings or lawsuits
pending or, to the Knowledge of Seller, threatened by any taxing authority with respect to
the Acquired Assets or Assumed Liabilities or related to the Branches; and no audit or
investigation of any Tax Return of Seller or its Affiliates with respect to the Acquired
Assets or Assumed Liabilities or related to the Branches is currently underway or, to the
Knowledge of Seller, threatened.




     (f) As used in this Agreement, the term “Taxes” shall mean all taxes, charges,
fees, levies or other like assessments, however denominated, including any interest,
penalties or other additions to tax that may become payable in respect thereof and
including any obligation to indemnify or otherwise assume or succeed to the tax liability of
another Person, imposed by any federal, territorial, state, local or foreign government



29









 







or
any agency or political subdivision of any such government, which taxes shall include,
without limiting the generality of the foregoing, all income or profits taxes (including,
but not limited to, federal income taxes and state income taxes), real property gains taxes,
payroll and employee withholding taxes, unemployment insurance taxes, social security taxes,
sales and use taxes, ad valorem taxes, excise taxes, franchise taxes, gross receipts taxes,
business license taxes, occupation taxes, real and personal property taxes, stamp taxes,
environmental taxes, transfer taxes, workers’ compensation, and other governmental charges,
and other obligations of the same or of a similar nature to any of the foregoing, which the
Seller or its subsidiaries or Affiliates is required to pay, withhold or collect. As used
in this Agreement, the term “Tax Returns” shall mean all reports, estimates,
declarations of estimated tax, information statements and returns relating to, or required
to be filed in connection with, any Taxes, including any schedule or attachment thereto, and
including any amendment thereof, and including information returns or reports with respect
to backup withholding and other payments to third parties.



     4.5
Employee Benefits. There are no liens or other claims which affect or could
affect the Acquired Assets of any nature, whether at law or in equity, asserted or unasserted,
perfected or unperfected, arising out of or relating to any employee, officer, or director of
Seller, or the operation, sponsorship or participation of any such persons or by Seller in any
employee benefit plan, program, procedure or other employee benefit practice, whether or not
subject to the Employee Retirement Insurance Security Act of 1974 (ERISA). There are no
liabilities, breaches, violations or defaults under any “Employee Welfare Benefit Plan” or
“Employee Pension Benefit Plan” (as such terms are defined in Section 3(1) and Section 3(2) of
ERISA, respectively) or any other compensatory or benefit arrangement, plan, or program or
contract, whether or not subject to ERISA, sponsored, maintained or contributed to by Seller or any
of its Affiliates that would subject the Acquired Assets, Buyer, its employee benefit plans, or any
fiduciaries thereof to any Tax, penalties or other liabilities. Seller will retain all liabilities
and assume all obligations with regard to all Employee Pension Benefit Plans, Employee Welfare
Benefit Plans, deferred compensation plans, early retirement plans, bonus or incentive programs,
severance pay plans, arrangements or programs, or any similar plans, programs or obligations
sponsored by the Seller or its Affiliates.



     4.6
Compliance with Applicable Laws. The Branches are in compliance with Applicable
Laws in all material respects, including, without limitation, all applicable Environmental Laws.
No event has occurred or circumstance exists that constitutes a material violation by the Seller in
the operation of the Branches, or a failure on the part of the Seller with respect to the Branches
to comply with, any Applicable Law in any material respect, including, without limitation, any
Environmental Law. Except for normal examinations conducted in the ordinary course of Seller’s
banking business, no Governmental Body has initiated any formal proceeding or investigation into
the business or operations of the Seller or the conditions or operations at the Branches and no
Governmental Body has initiated any regulatory proceeding or investigations into the business or
operations of the Branches. There is no unresolved violation, criticism or exception by any
Governmental Body with respect to any report or statement relating
to any examinations of the Seller relating to the Branches, the Acquired Assets or the Assumed
Liabilities.



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     4.7
Legal Proceedings; Orders.




     (a) Except as set forth on Schedule 4.7(a) hereof, there is no pending
Proceeding that has been commenced by or against Seller that relates to or arises from the
business conducted by the Branches. To the Knowledge of Seller, (i) no such Proceeding has
been threatened and (ii) no event has occurred or circumstance exists that may give rise to
or serve as a basis for the commencement of any such Proceeding.




     (b) There is no Order to which Seller, or any of the assets owned or used by Seller, is
subject that would have a Seller Material Adverse Effect. Seller is not subject to any
Order that relates to the business of, or any of the assets owned or used by, the Branches.



     4.8 Employees.




     (a) Seller has provided Buyer a complete list, prepared as of a date within ten (10)
days prior to the date of this Agreement, of the employees of the Branches and the Select
Remote Employees identifying positions held, exempt or non-exempt status (for purposes of
the Fair Labor Standards Act and comparable local wage hours law), current annual salaries
or wage rates, target incentive opportunity and projected incentive pay-out for 2009 (if
any), actual incentive compensation for 2008 (if any), period of service, and whether such
employee is a part-time or full-time employee, and the information contained in such list
remains true and complete as of the date hereof.




     (b) Except as set forth on Schedule 4.8(b) hereof, no employee of the Branches
or Select Remote Employee is a party to, or is otherwise bound by, any employment contract,
agreement or arrangement, including any confidentiality, noncompetition, or proprietary
rights agreement, between such employee and Seller, or to Seller’s Knowledge, between any
such employee and any third party.




     (c) No employee at the Branches or Select Remote Employee is represented, for purposes
of collective bargaining, by a labor organization of any type. There is no labor strike,
arbitration, dispute, or slowdown or stoppage pending, or to Seller’s Knowledge, threatened,
involving the employees of the Branches or the Select Remote Employees, and Seller is
unaware of any efforts during the past three (3) years to unionize or organize any employees
at the Branches.




     (d) In relation to the Branches and except as set forth on Schedule 4.8(d)
hereof, no causes of action, complaints, claims, charges or administrative investigations
for unfair labor practices, wrongful discharge, violation of employment contract or
employment claims based upon any state or federal law, statute, public policy, order or
regulation is pending, or to Seller’s Knowledge, threatened against Seller or its
Affiliates. There are no suits, claims, grievances, or causes of action pending, or, to
Seller’s Knowledge, threatened, against Seller (whether in court or before an administrative
agency) arising out of or related to Seller’s employment, termination of employment, or
consideration for employment of individuals at the Branches or Select Remote Employees.



31









 






     (e) In relation to the Branches, Seller and its Affiliates have complied in all
material respects with all laws (including reporting and disclosure requirements) relating
to the employment of labor, including provisions relating to wages, hours, collective
bargaining, occupational safety, discrimination, classification of employees as exempt or
non-exempt for purposes of the Fair Labor Standards Act and comparable local wage and hour
laws, and the payment of social security or other taxes, and worker’s compensation or other
insurance premiums, and Seller has not received any notice alleging that it has failed to
comply in any respect with such laws.




     (f) Buyer will not incur any liability under any severance agreement, deferred
compensation agreement, employment agreement, or similar agreement or plan as a result of
the transaction contemplated by this Agreement of which Seller is a party or to which it is
bound in respect of any employees of the Branches or the Select Remote Employees. Seller
agrees that Buyer will not be bound to the terms of any employment, management, consulting,
reimbursement, retirement, early retirement or similar agreement, whether active on the
Closing Date or in discussion or negotiation, with any employees of the Branches or Select
Remote Employee as to which Seller is a party or to which Seller is bound.



     4.9 Environmental Matters.




     (a) Except as disclosed on Schedule 4.9(a) hereof or as discovered during the
investigations conducted pursuant to Section 6.15, during Seller’s ownership or
operation of the Branches: (i) Seller has not been notified in writing that either Seller or
any of the Branches were or are now in violation of any Environmental Law, and (ii) the
Branches and the Seller in connection with the Branches have been and are in material
compliance with all applicable Environmental Laws.




     (b) Except as discovered during the investigations conducted pursuant to Section
6.15, during Seller’s ownership or operation of the Branches, Seller has not been
notified in writing that any of the Real Estate Interests, or Seller in connection with the
Real Estate Interests, were or are in violation of any Environmental Law. To Seller’s
actual knowledge, none of the Branches or the Real Estate Interests, or the Seller in
connection with the Real Estate Interests, are in material violation of Environmental Laws
as a result of conditions, acts, or omissions existing or occurring prior to Seller’s
ownership or operation of the Branches.




     (c) Except as discovered during the investigations conducted pursuant to Section
6.15, there are no Proceedings pending or, to Seller’s actual knowledge, threatened, nor
have there been any past Proceedings (or, in the case of Proceedings during any period prior
to Seller’s ownership or operation, any past Proceedings to Seller’s actual knowledge)
relating to the Real Estate Interests, or Seller in connection with the Real Estate
Interests, under any Environmental Law, including, without
limitation, any notices, demand letters or requests for information from any federal or
state Governmental Body.



32









 






     (d) Seller has not received any written notice of any violation of or liability or lien
pursuant to any Environmental Laws with regard to the Branches.




     (e) Except as discovered during the investigations conducted pursuant to Section
6.15, Seller has not generated, stored, released, or disposed of any Hazardous Materials
at, in, from, on, under or about any of the Branches except in full compliance with
Environmental Laws. To Seller’s actual knowledge, prior to Seller’s ownership or operation
of the Branches, no Hazardous Materials were generated, stored, released, disposed or are
otherwise present at, in, on, under or about any of the Branches or from any of the Branches
except in full compliance with Environmental Laws.




     (f) Except as discovered during the investigations conducted pursuant to Section
6.15, during Seller’s ownership or operation of the Branches, no release (as defined at
CERCLA, 42 U.S.C. 9601(22)) of Hazardous Materials has occurred at or from any Branch. To
Seller’s actual knowledge, prior to Seller’s ownership or operation of the Branches, no
release (as defined at CERCLA, 42 U.S.C. 9601(22)) of Hazardous Materials has occurred at or
from any Branch. To Seller’s actual knowledge, no condition exists at or in connection with
any Branch for which applicable Environmental Laws required or require notice to any third
party, further investigation, or response action.




     (g) To Seller’s actual knowledge and except as disclosed on Schedule 4.9(g)
hereof or as discovered during the investigations conducted pursuant to Section
6.15, no asbestos, mold or lead-based paint is contained in any Branch or property
owned, leased or operated by the Seller in connection with the Branches.




     (h) Except as discovered during the investigations conducted pursuant to Section
6.15, to Seller’s Knowledge, there are no underground storage tanks on or under any
Branch, nor any Hazardous Material at, in, on, or under or emanating from any Branch in any
quantity or concentration in violation of any standard or limit established pursuant to
Environmental Laws.




     (i) Seller is not required to have any Governmental Authorization under Environmental
Laws in connection with any of the Branches.




     (j) To Seller’s actual knowledge and except as discovered during the investigations
conducted pursuant to Section 6.15, during Seller’s ownership or operation of the
Branches, no Hazardous Materials generated at any Branch have been treated, stored, or
disposed of at a location that has been identified by a Governmental Body as a facility that
is subject to any existing or potential claim under Environmental Laws. To Seller’s actual
knowledge, prior to Seller’s ownership or operation of the Branches, no Hazardous Materials
generated at any Branch have been treated, stored, or disposed of at a location that has
been identified by a Governmental Body as a facility that is subject to any existing or
potential claim under Environmental Laws.




     (k) Seller has delivered to Buyer on or prior to the date hereof (or, at the latest,
within ten (10) days following the date of this Agreement), true and complete



33









 







copies of all
documents, records, and information in its possession or control that identify environmental
liabilities and other environmental matters, including, without limitation, previously
conducted environmental site assessments, reports, studies, surveys and other similar
documents or information, including, without limitation, related correspondence, relating to
each of the Real Estate Interests.



     4.10 Loans. Seller has provided to Buyer a true and accurate data file of all Loans,
including the outstanding principal balance of and the amount of accrued and unpaid interest and
fees on such Loans, prepared as of a date within ten (10) days prior to the date of this Agreement,
which data shall be updated at and as of the Closing Date, and, in each case as updated, shall be
true and accurate in all material aspects as of such date.




     (a) Each Loan included in the Acquired Assets was made or acquired by Seller or its
predecessor in the Ordinary Course of Business. Except as set forth on Schedule
4.10(a) hereof, none of the loans of the Branches (including the Loans) consist of loans
between Seller, on the one hand, and any employee or Affiliate of Seller or any of Seller’s
Affiliates.




     (b) None of the Loans are presently serviced by third parties, and there are no
obligations, agreements or understandings whatsoever that could result in any Loan becoming
subject to any such third party servicing.




     (c) There are no misrepresentations of material facts made by officers or employees of
Seller in the credit files relating to the Loans, provided that the term “facts” shall not
include judgments or opinions of such officers or employees which were in good faith or
information which is reflective of information supplied by the borrower or other third
parties.




     (d) With respect to each Loan:




     (i) Such Loan was solicited, originated, administered, serviced and currently
exists in material compliance with all applicable requirements of federal laws and
regulations promulgated thereunder, including, as applicable, any written SBA
service guidelines, and to the extent, if any, that their applicability to Seller is
not preempted by federal laws and regulations, state and local laws and regulations
promulgated thereunder (for purposes of this clause (i), a Loan would not be in
material compliance if the noncompliance adversely affects the value or
collectibility of the Loan or subjects the lender to any penalty or liability);




     (ii) Each note, agreement or other instrument evidencing a Loan and any related
security agreement and other document securing, governing or otherwise relating to
such Loan (including, without limitation, any guaranty or similar instrument) is
true, genuine and, in all material respects, complete, and constitutes a valid,
legal and binding obligation of the obligor named therein, enforceable in accordance
with its terms, subject as to enforcement to bankruptcy,
insolvency, reorganization, moratorium, laws governing fraudulent conveyance or
equitable subordination principles and other laws of general applicability relating



34









 







to or affecting creditors’ rights generally, and all actions necessary to perfect
any related security interest in favor of Seller have been duly taken;




     (iii) Such Loan (A) to the extent secured or purported to be secured by a lien
in favor of Seller, is secured by a valid and enforceable, and duly perfected, lien
in favor of Seller in the collateral therefor, which lien is assignable, and (B)
contains customary and enforceable provisions such that the rights and remedies of
the holder thereof shall be adequate for the practical realization against any
collateral therefor;




     (iv) There has been no material modification, amendment or supplement to or
material waiver of the terms of the applicable loan documents except as reflected in
writing in the loan file made available to Buyer in respect of such Loan;




     (v) Such Loan is accruing interest in accordance with its terms;




     (vi) Such Loan is not pledged to a third party or otherwise encumbered, and no
other party has filed a UCC financing statement in connection therewith;




     (vii) Seller is in possession of all (A) original notes or lost note
affidavits, or (B) mortgages or certified copies of such mortgages and financing
statements (or other lien filing documents), provided that such mortgages and
financing statements (or other lien filing documents) have been returned by the
local recording office;




     (viii) There is no valid claim or valid defense (including the defense of
usury) to the enforcement of such Loan or a valid right of setoff or rescission;




     (ix) No claim or defense (including the defense of usury) to the enforcement of
a Loan or a valid right of setoff or rescission has been asserted with respect to
any Loan by the applicable borrower(s) under such Loan or, to the Knowledge of
Seller, by any other Person;




     (x) Neither Seller nor any predecessor has taken or failed to take any action
that would entitle any obligor or other party to assert successfully any claim
against Seller or Buyer (including, without limitation, any right not to repay any
such obligation or any part thereof);




     (xi) Such Loan was made substantially in accordance with Seller’s or Seller’s
predecessor’s standard underwriting and documentation guidelines as in effect at the
time of its origination, and has been administered substantially in accordance with
Seller’s or Seller’s predecessor’s standard loan servicing and operating procedures
as in effect from time to time;




     (xii) Seller may transfer or assign such Loan to Buyer without the approval or
consent of any obligor thereunder;



35









 






     (xiii) Such Loan is not as of the date hereof, or is or has not been during the
period beginning on the date hereof and ending on and as of the Closing Date, thirty
(30) calendar days or more delinquent (without giving effect to any grace period,
waiver, forbearance, reservation of rights, extension, modification or amendment);




     (xiv) Neither the borrower nor any guarantor of the Loan is in bankruptcy and,
to Seller’s Knowledge, there are no facts, circumstances or conditions with respect
to such Loan, the collateral therefor or the borrower’s credit standing, that could
reasonably be expected to cause such Loan to become delinquent or adversely affect
the collectibility, the value or the marketability of such Loan;




     (xv) No notice of default has been given or received by Seller with respect to
any Loan and Seller has not received any notice of any violation of law with respect
to any Loan or any collateral for any Loan;




     (xvi) There is no pending, or to Seller’s Knowledge, threatened, litigation or
claims which may affect in any way the title or interest of the Seller or the
borrower in and to such Loan, the collateral for such Loan and the promissory note
or the mortgage or deed of trust;




     (xvii) There are no threatened or pending foreclosures, total or partial
condemnation (to Seller’s Knowledge) or repossession proceedings or insurance claims
(to Seller’s Knowledge) with respect to such Loan or the collateral for such Loan;
and




     (xviii) Seller has not directed, controlled or overseen the management of
environmental matters of any borrower or any real estate in which the Seller in
connection with the Branches holds or has held a security interest and which
constitutes a Loan so as to cause the Seller to act outside the exclusion under 42
U.S.C. § 9601(20)(E) or any other analogous provisions under applicable
Environmental Laws.



     4.11 Owned Real Property, Leased Real Properties and Tangible Personal Property.




     (a) Schedule 4.11(a)(i) hereof lists and describes briefly all real property
owned by Seller and used as Branch premises (the “Owned Real Property”). With
respect to each parcel of the Owned Real Property, Seller has good and marketable fee title
to such parcel of Owned Real Property free and clear of any Encumbrance except for Permitted
Encumbrances. With respect to each Leased Real Property, Seller has a good and valid
leasehold interest in such Leased Real Property on and subject to the terms of its
applicable Lease, it being understood that Seller makes no representations or warranties
about matters affecting the respective landlords’ fee title to the Leased Real Properties).
Except as set forth on Schedule 4.11(a)(ii), there are no tenants or other
parties claiming by, through or under Seller that have a possessory right in and to any
space in respect of the Owned Real Property (all such agreements listed on Schedule



36









 







4.11(a)(ii), the “Tenant Leases”). Seller has delivered to Buyer a true,
correct and complete copy of each Tenant Lease as amended, modified or supplemented. Each
Tenant Lease is an existing legal, valid and binding obligation of Seller and, to Seller’s
Knowledge, each other party thereto, subject to bankruptcy, insolvency, reorganization,
moratorium, receivership, conservatorship and similar laws relating to the rights and
remedies of creditors, as well as to general principles of equity; and there does not exist
with respect to Seller’s obligations thereunder, or, to Seller’s Knowledge, with respect to
the obligations of the tenant thereunder, any default, or event or condition which
constitutes or, after notice or passage of time or both, would constitute a default, on the
part of Seller or the tenant under any such Tenant Lease.




     (b) Except as set forth in Schedule 4.11(b) hereof, with respect to the
Acquired Tangible Personal Property, the Owned Real Property and the Leased Real Properties
(it being understood that Seller is not the fee owner of any Leased Real Property and so,
notwithstanding anything to the contrary herein, to the extent the representations relating
to the real property parcel of which a Leased Real Property is a part set forth below are
qualified to the “Seller’s Knowledge,” such knowledge shall be limited to the actual
knowledge (without inquiry or investigation) of Seller’s officers or directors or senior
managers or Branch managers; provided, however, that Seller shall be deemed
to have knowledge of any matter, fact, event, default, violation, breach, noncompliance,
notice, consent or other circumstance if any of the same shall have been delivered in
writing to Seller at anytime prior to the Closing):




     (i) there are no pending or, to Seller’s Knowledge, threatened, condemnation
proceedings, claim of violation of zoning laws, governmental investigation,
lawsuits, or administrative actions relating to the Owned Real Property, Seller’s
interest in the Leases or the Leased Real Properties, or the Acquired Tangible
Personal Property, or, to Seller’s Knowledge, in the case of each Leased Real
Property, the real property parcel of which such Leased Real Property forms a part,
affecting, or which might affect, adversely in any material respect, the current
use, occupancy, or value thereof;




     (ii) there are no outstanding options or rights of first refusal to purchase
any parcel of the Owned Real Property, the Leases or Seller’s interest in the Leased
Real Properties, or the Acquired Tangible Personal Property, or any portion thereof
or interest therein, or, to Seller’s Knowledge, in the case of any Leased Real
Property, the real property parcel of which such Leased Real Property forms a part,
or any portion thereof or interest therein except, in the case of the Leased Real
Properties, such options or rights as set forth in the Leases;




     (iii) no written notice of any violation of zoning laws, building or fire codes
or other statutes, ordinances, or regulations or of restrictive covenants relating
to the use or operation of the Real Estate Interests has been received by Seller
which has not been corrected and, if required, accepted in writing by the applicable
Governmental Body, and Seller has not undertaken or completed any
construction or improvements on the Real Estate Interests within the past one
hundred fifty (150) days which could result in the imposition of any mechanics,



37









 







materialmen or other similar liens on the Real Estate Interests (other than minor
repairs made in the Ordinary Course of Business, all of which have been paid in
full);




     (iv) there is no pending or, to Seller’s Knowledge, contemplated rezoning
proceeding or special assessment affecting the Real Estate Interests or, to Seller’s
Knowledge, in the case of each Leased Real Property, the real property parcel of
which such Leased Real Property forms a part;




     (v) to Seller’s Knowledge, the Real Estate Interests are not subject to any
special tax valuation or special tax exemption, which upon a change in use or
ownership of the Real Estate Interests will result in a “rollback tax” or similar
assessment, and to Seller’s Knowledge, with respect to any real property parcel of
which any Leased Real Property forms a part, such parcel is not subject to any
special tax valuation or special tax exemption, which upon a change in use or
ownership of such parcel will result in a “rollback tax” or similar assessment that
would be payable by Seller under any Lease;




     (vi) to Seller’s Knowledge, (A) access to each of the Owned Real Property and
each the Leased Real Property (or in the case of any Leased Real Property, the real
property parcel of which such Leased Real Property forms a part) is available over
public streets, (B) all water, sewer, gas, electric, telephone, cable, drainage and
other utility equipment, facilities and services required by applicable laws and
regulations or necessary for the current operation of the Real Estate Interests are
installed, connected and adequate to serve the Real Estate Interests for their
current use, and (C) all utility lines servicing the Real Estate Interests are
located either within the boundaries of the applicable Owned Real Property or Leased
Real Properties (or in the case of any Leased Real Property, the real property
parcel of which such Leased Real Property forms a part), within lands dedicated to
the public use or within recorded easements for such purpose, and are serviced and
maintained by the appropriate public or quasi-public entity;




     (vii) to Seller’s Knowledge, Seller possesses all rights, privileges, licenses,
franchises, permits and other authorizations (including certificates of occupancy,
if applicable) that are material to the current use, occupancy, and operation of the
Real Estate Interests;




     (viii) all permits that are material to the current use, occupancy and
operation of the Real Estate Interests and, to Seller’s Knowledge, in the case of
any Leased Real Property, the real property parcel of which such Leased Real
Property forms a part, are in full force and effect and Seller has not received
written notice of any pending or threatened revocation, suspension or termination
proceedings concerning such permits;




     (ix) all improvements located on the Owned Real Property and, to Seller’s
Knowledge, on the Leased Real Properties, the roofs thereon, and all mechanical
systems (including, without limitation, all HVAC, plumbing,



38









 







electrical, elevator,
security, utility, sprinkler and safety systems) therein, are in good working order,
and, to Seller’s Knowledge, are in sound structural condition and free from material
defect or deficiency;




     (x) Seller has not received any written notice (which remains outstanding) from
a Governmental Body or other party alleging the existence of such defect or
deficiency as set forth in subclause (ix) of this Section 4.11(b); and




     (xi) there has been no casualty damage affecting all or any material portion of
the Owned Real Property or the Leased Real Properties which has not been restored
except for any damage for which either adequate insurance proceeds will be
transferred to Buyer at Closing, with Seller being responsible for deductibles or,
in the case of any Leased Real Property, the landlord under the Lease is responsible
to restore under the terms of such Lease and which damage has been disclosed to
Buyer.



     4.12 Leased Real Property. Schedule 4.12 attached hereto lists all leases,
subleases, occupancy agreements or similar agreements under which Seller occupies (or has the right
to occupy) pursuant to a lease, license or similar arrangement any real property interest (i) used
as a Branch, or (ii) used in connection with the operation of such Branch if such real property
interest is incidental to and located at or in immediate and close proximity to such Branch
(including any separate parking lot leases where customers of such Branch are permitted to park)
(collectively, the “Leases”), and Seller is entitled to possession of the Leased Real
Properties as lessee in accordance with the terms of the respective Leases. The Leases are
accurately described on Schedule 4.12 attached hereto and, except as shown on Schedule
4.12, have not been amended, modified or supplemented. Seller has delivered to Buyer a true,
correct and complete copy of each Lease as amended, modified or supplemented. Each Lease is an
existing legal, valid and binding obligation of Seller and, to Seller’s Knowledge, each other party
thereto, subject to bankruptcy, insolvency, reorganization, moratorium, receivership,
conservatorship and similar laws relating to the rights and remedies of creditors, as well as to
general principles of equity; and there does not exist with respect to Seller’s obligations
thereunder, or, to Seller’s Knowledge, with respect to the obligations of the lessor thereof, any
default, or event or condition which constitutes or, after notice or passage of time or both, would
constitute a default, on the part of Seller or the lessor under any such Lease. There are no
tenants or other parties claiming by, through or under Seller that have a possessory right in and
to any space in respect of the Leased Real Properties. As used in this Section 4.12, the
term “lessor” includes any sub-lessor of the property to Seller. There are no subleases relating
to any Leased Real Property created or suffered to exist by Seller, or to Seller’s Knowledge,
created or suffered to exist by any other Person. Subject to Seller obtaining any consents
necessary for the valid assignment to Buyer of the Leases, which consents are listed on
Schedule 4.12 (the “Landlord Consents”), the assignment of such Leases will
transfer to Buyer on the Closing Date all of Seller’s rights under the Leases.



     4.13
Acquired Contracts. Seller has delivered to Buyer a correct and complete copy of
each written Acquired Contract (as amended to date) and a written summary setting forth the terms
and conditions of each oral Acquired Contract, if any. With respect to each such Acquired
Contract: (i) it is a legal, valid, binding and enforceable contract, and in full force and
effect, as



39









 







 against Seller and, to the Knowledge of Seller, each other party thereto, subject to
bankruptcy, insolvency, reorganization, moratorium, receivership, conservatorship and similar laws
relating to the rights and remedies of creditors, as well as to general principles of equity; (ii)
it will continue to be such a legal, valid, binding and enforceable contract, and in full force and
effect, as against Seller and, to the Knowledge of Seller, each other party thereto on identical
terms following the consummation of the transactions contemplated hereby, (iii) neither Seller nor,
to the Knowledge of Seller, each other party thereto is in breach or default thereunder and no
event has occurred that with notice or lapse of time, or both, would constitute a breach or default
thereunder or permit termination, modification, or acceleration thereunder, and (iv) neither
Seller, nor to Seller’s Knowledge, any other party thereto has repudiated any provision thereof.



     4.14 Absence of Certain Changes and Events. Since October 1, 2009 Seller has not:




     (a) suffered any change which would have a Seller Material Adverse Effect;




     (b) except in the Ordinary Course of Business and consistent with prudent banking
practices, (i) sold, transferred, leased, pledged, mortgaged, or otherwise encumbered or
(except for this Agreement) agreed to sell, transfer, lease, pledge, mortgage or otherwise
encumber, any of the Acquired Assets or rights with respect thereto, (ii) canceled, waived,
compromised or agreed to cancel, waive or compromise any debts, claims or rights with
respect to the Acquired Assets or the Assumed Liabilities, or (iii) amended, modified or
supplemented any of the terms or conditions governing the Loans;




     (c) made or permitted any amendment, termination or lapse of any contract, lease,
agreement, license or permit, if such amendment, termination or lapse (individually or in
the aggregate) would reasonably be expected to have a Seller Material Adverse Effect;




     (d) made any change in any method of management or operation of the Branches not in the
Ordinary Course of Business or any accounting change, except as may be required by generally
accepted accounting principles or general regulatory requirements;




     (e) except as set forth in Schedule 4.14(e) hereof, granted any general
increase in the compensation (including bonuses) of its officers or employees located at the
Branches or the Select Remote Employees (including any increase pursuant to any bonus,
pension, profit sharing or other plan or commitment), except for, to the extent permitted by
Section 6.1(b)(i) hereof for the period between the date hereof and the Closing
Date, normal periodic increases made pursuant to established compensation policies applied
on a basis consistent with that of the prior year, and increases and
payments necessary, in the Seller’s reasonable discretion, to maintain and preserve the
operation of the Branches, all of which increases that relate to employees located at the
Branches or the Select Remote Employees shall be promptly disclosed in writing to Buyer by
Seller within forty-five (45) days prior to the Closing Date;



40









 






     (f) caused the Branches to transfer to Seller’s other operations any deposits other
than deposits that are not Deposits for purposes of this Agreement, except in the Ordinary
Course of Business at the unsolicited request of depositors, or caused any of Seller’s other
operations to transfer to the Branches any deposits, except in the Ordinary Course of
Business at the unsolicited request of depositors;




     (g) made any change to its customary policies for setting rates on deposits offered at
the Branches, including any increase in interest rates paid except as otherwise contemplated
by Section 6.1(b)(v) hereof; or




     (h) entered into any other transaction or agreement, incurred any capital expenditures,
or conducted its affairs, in each case as related to the Acquired Assets or the Assumed
Liabilities, other than in the Ordinary Course of Business and consistent with prudent
banking practices except as contemplated by this Agreement.



     4.15 Escheat Deposits. All of the deposits and other property (including the contents
of safe deposit boxes) held or maintained at the Branches that would constitute escheated deposits
or property at any time prior to the Closing were properly reported and transmitted to the
applicable Governmental Body.



     4.16 Books and Records. The Books and Records accurately reflect in all material
respects as of their respective dates the Book Value of the Acquired Assets and Assumed Liabilities
being transferred to Buyer hereunder. The Books and Records are true and complete in all material
respects and fairly reflect and also include all customary Branch, customer and customer-related
information reasonably necessary to service the Deposits and Loans on an ongoing basis, and to
otherwise operate the business in respect of the Acquired Assets and Assumed Liabilities being
acquired or assumed under this Agreement in substantially the manner currently operated by Seller.
The Books and Records, including, but not limited to, IRA and Keogh Account documentation, are in
compliance in all material respects with all requirements of applicable law.



     4.17 Insurance. Seller maintains in full force and effect insurance on the
Acquired Assets in such amounts and against such risks and losses as are (based on advice of its
insurance broker) customary and adequate for comparable entities engaged in the same business and
industry.



     4.18 Disclosure. No representation or warranty of Seller contained herein, when
read together with the Disclosure Schedule, is false or misleading in any material respect or omits
to state a fact herein or therein necessary in order to make the statements contained herein or
therein not false or misleading in any material respect.



     4.19 Community Reinvestment Act Designations. As of the date of this Agreement,
each of the subsidiaries or Affiliates of Seller that is an insured depository institution was
rated
“Satisfactory” or “Outstanding” following its most recent Community Reinvestment Act
examination by the regulatory agency responsible for its supervision. To Seller’s Knowledge,
Seller has not received any notice of and has not been made aware of any planned or threatened
objection by any community group to the transaction contemplated hereby.



41









 





     4.20 No Knowledge of Fraud. Seller is not aware (based on Seller’s Knowledge) of:
(i) any Loan, Deposit, lending relationship or deposit relationship held or maintained at the
Branches that is or may reasonably be considered to be fraudulent in nature, notwithstanding that
any Loan may be current and performing; or (ii) any device, artifice or scheme, whether by
customers or Seller’s employees, to commit fraud with respect to any activities conducted at the
Branches, including but not limited to deposit or lending functions conducted at the Branches.



     4.21 Limitation on Warranties. EXCEPT AS SPECIFICALLY SET FORTH IN THIS AGREEMENT,
SELLER EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES, EXPRESS OR IMPLIED, WITH RESPECT TO THE OWNED
REAL PROPERTY, LEASED REAL PROPERTIES, OR THE ACQUIRED TANGIBLE PERSONAL PROPERTY OR WITH RESPECT
TO ANY ACQUIRED ASSETS OR ASSUMED LIABILITIES, INCLUDING, WITHOUT LIMITATION, THE IMPLIED
WARRANTIES OF MERCHANTABILITY OR OF FITNESS FOR A PARTICULAR PURPOSE.



ARTICLE 5

REPRESENTATIONS AND WARRANTIES OF BUYER




     Buyer represents and warrants to Seller that the statements contained in this Article
5 are correct and complete as of the date of this Agreement and will be correct and complete as
of the Closing Date (as though made then as though the Closing Date were substituted for the date
of this Agreement throughout this Article 5).



     5.1 Organization, Qualification, and Corporate Power. Buyer is a national banking
association duly organized and validly existing under the laws of the United States, with full
corporate power and authority to conduct its business as now being conducted and to own or use the
properties and assets that it purports to own or use.



     5.2 Authorization of Transaction. Buyer has the full corporate power and authority
to execute and deliver this Agreement and the other Buyer Documents. Subject to approval by any
necessary federal or state banking regulatory authority, Buyer has the corporate power to perform
Buyer’s obligations hereunder and under the other Buyer Documents, and to consummate the
transactions contemplated hereby and thereby. Each of this Agreement, and when executed and
delivered, each of the other Buyer Documents, constitutes the valid and legally binding obligation
of Buyer, enforceable against Buyer in accordance with its terms and conditions, subject to
bankruptcy, insolvency, reorganization, moratorium, receivership, conservatorship and similar laws
relating to the rights and remedies of creditors, as well as to general principles of equity.
Except for the Regulatory Approvals or as otherwise provided herein, Buyer is not required to give
any notice to, make any filing with, or obtain any authorization, or Consent of any Governmental
Body in order to execute and deliver this Agreement or consummate the Acquisition.



     5.3 Noncontravention. Subject to the required Consents described in Section
5.2, neither the execution and the delivery of this Agreement by Buyer, nor the consummation of
the Acquisition by Buyer, will directly or indirectly:



42









 






     (a) Contravene, conflict with, or result in a violation of (i) any provision of the
charter or bylaws of Buyer or (ii) any resolution adopted by the board of directors or the
shareholders of Buyer;




     (b) Contravene, conflict with, or result in a violation of, or give any Governmental
Body or other Person the right to challenge the Acquisition or to exercise any remedy or
obtain any relief under, any Applicable Law or any Order to which Buyer, or any of the
assets owned or used by Buyer may be subject;




     (c) Except for matters which would not have a Buyer Material Adverse Effect,
contravene, conflict with, or result in a violation of the terms or requirements of, or give
any Governmental Body the right to revoke, withdraw, suspend, cancel, terminate or modify,
any Governmental Authorization that is held by Buyer or that otherwise relates to the
business of, or any of the assets owned or used by, Buyer; or




     (d) Except for matters which would not have a Buyer Material Adverse Effect,
contravene, conflict with, or result in a violation or breach of any provision of, or give
any Person the right to declare a default or exercise any remedy under, or to accelerate the
maturity or performance of, or to cancel, terminate or modify, any Contract to which Buyer
is a party.



     5.4 Brokers’ Fees. Except for fees payable to RBC Capital Markets Corporation, Buyer
has no Liability or obligation to pay any fees or commissions to any broker, finder, or agent with
respect to the Acquisition, and Buyer shall be solely liable for payment of any such fees or
commissions payable to RBC Capital Markets Corporation.



     5.5 Legal Proceedings; Orders. There are no pending proceedings or an Order pending
against Buyer that would prohibit Buyer’s fulfillment of obligations agreed to in this Agreement.



     5.6 Financial Condition. The financial condition of Buyer is sufficient to enable
Buyer to consummate the Acquisition without any external financing.



     5.7 Regulatory Condition. Buyer has not received any indication from any federal or
state governmental agency or authority that such agency would oppose or refuse to grant a
Regulatory Approval, and to Buyer’s Knowledge, there exists no fact or circumstance that would
prevent or delay Buyer’s ability to obtain promptly all Regulatory Approvals.



ARTICLE 6

PRE-CLOSING COVENANTS




     The Parties agree as follows with respect to the period from and after the execution of this
Agreement.




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     6.1 Operation of Business.




     (a) From the date of this Agreement through the Closing Date, Seller shall use
Commercially Reasonable Efforts to maintain the level of customer accounts of the Branches
existing on the date hereof.




     (b) From the date of this Agreement through the Closing Date, Seller will not, and will
not cause or allow the Branches to, engage in any practice, take any action, or enter into
any transaction outside the Ordinary Course of Business, and, without the prior written
consent of Buyer, Seller shall not with respect to the Branches:




     (i) increase the rate of compensation of any of the Branches officers or
employees or Select Remote Employees, or enter into any employment contracts with
any Potential Employee except in the Ordinary Course of Business; provided,
however, prior to or on the Closing Date, Seller shall pay in full to the
Retained Employees the performance, incentive or other bonuses required to be paid
to them pursuant to Section 6.7(c) hereof;




     (ii) authorize or make any capital expenditure(s) which, individually or in the
aggregate, exceeds $5,000 for any single Branch;




     (iii) extend any new, or renew any existing, loan (or Commitment), credit,
lease, or other type of financing or renew any such type of financing in which the
maximum principal amount thereunder would pursuant to the terms thereof exceed
$1,000,000;




     (iv) extend any new, or renew any existing, loan, credit, lease, or other type
of financing or renew any such type of financing, or purchase any loan participation
interest, which does not meet Seller’s loan policy requirements as of the date of
this Agreement;




     (v) make any change to (A) the interest rates or price or rates of fees, (B)
the policies or programs, or (C) the period of time applicable to any promotional
period, in each case as in existed on the date of this Agreement with respect to the
loans or deposits of, or offered by, the Branches other than in the Ordinary Course
of Business and as determined to be necessary or advisable by Seller in the
reasonable bona fide exercise of its discretion based on changes in market
conditions applicable to the Branches; provided, however, that (1)
an interest rate increase on any deposit in excess of 25 basis points or a decrease
in the interest rate of any loan in excess of 50 basis points shall not be deemed to
be in the Ordinary Course of Business and shall require Buyer’s prior written
consent (it being understood that Buyer shall not unreasonably withhold or delay its
consent with respect to such actions), and (2) Seller shall be permitted to offer
interest rates on any certificates of deposits or money market deposit accounts at
rates that are lower than the rates offered as of the date of this Agreement without
the prior written consent of Buyer;



44









 






     (vi) authorize or allow Potential Employees to take vacation or other voluntary
leaves of absence during the five (5) Business Day periods preceding or following
the Closing Date, other than any leave of absence that is required to be granted
pursuant to the Family Medical Leave Act;




     (vii) deliver or distribute, in writing or electronically, to any customer of
the Seller, any notice, letter or other correspondence that is related to the
Acquisition or matters of transition related thereto, including the status of such
customer’s accounts or loans with Seller (it being understood that Buyer shall not
unreasonably withhold or delay its consent with respect to such actions);




     (viii) forward to vendors of Seller the names and other contact information of
depositors and other customers of the Branches if such vendors are permitted to use
such information to solicit credit card, debit card or prepaid card business, or
brokerage, investment or insurance business or any other business customarily
conducted by a bank, from such depositors and other customers, except that nothing
contained in this clause (viii) shall restrict Seller from forwarding such names to
First Brokerage America, LLC (or its insurance company subsidiary) to enable them to
carry on the brokerage and insurance business carried on by them out of the Branches
consistent with past practices;




     (ix) make any material changes to the terms and conditions governing the
Deposit accounts, other than as required by applicable law, rule or regulation;




     (x) enter into any interest rate swap, collar, floor or other hedging or
derivative agreement or amend, modify or supplement any thereof, or agree to any
provision in any Loan entered into after the date hereof under which the borrower
under such Loan shall be required or permitted, with respect to such Loan, to enter
into any interest rate swap, collar, floor or other hedging or derivative agreement;




     (xi) amend, terminate, extend or waive any right in any material respect, or
sell, assign or transfer, any Lease or Acquired Contract; provided,
however, that (A) in the case of any Lease, Seller may, without the consent
of Buyer, exercise any renewal option on the renewal terms expressly set forth under
such Lease as of the date hereof (and without modification, for the avoidance of
doubt, to the payment amount or obligations thereunder) if such Lease shall expire
prior to the Closing Date unless Buyer shall have delivered written notice
instructing Seller not to renew or extend such Lease within ten (10) Business Days
following notice from Seller of its intention to extend or renew such Lease (and
Seller hereby agrees to give notice to Buyer of its intention to so extend or renew
any such Lease), and (B) in the case of any Acquired Contract, Seller may, without
the consent of Buyer, amend, terminate or extend such Acquired Contract that
involves the payment or receipt of not more than $2,500 during any one (1) year
period;



45









 






     (xii) except as required by law or the terms of the documents governing any
Loan, (A) release any collateral or any party from any liability on or with respect
to such Loan, (B) compromise or settle any material claims of any kind or character
with respect to such Loan, or (C) amend or waive any of the material rights or other
terms of such Loan as set forth in the Loan documents; provided,
however, that Buyer agrees not to unreasonably withhold or delay its consent
to any of the actions described in clause (C) above provided that such actions are
taken in accordance with the underwriting standards, pricing levels and other
parameters or terms of Seller as in effect on the date hereof or as mutually agreed
upon by the Buyer and Seller in writing from time to time;




     (xiii) sell, transfer, assign, encumber or otherwise dispose of, or enter into
any contract, agreement or understanding to sell, transfer, assign, encumber or
dispose of, any of the assets or deposits of the Branches, except in the Ordinary
Course of Business consistent with past practice; provided, however,
in no event shall Seller take any of the foregoing actions with respect to (A) any
of the Owned Real Property, (B) any of the Leases, (C) any of the Deposits, or (D)
any Loan;




     (xiv) except as permitted by this Section 6.1(b), knowingly take, or
knowingly permit its Affiliates to take, any action (A) impairing Buyer’s rights in
any Deposit or Acquired Asset, (B) impairing in any way the ability of Buyer to
collect upon any Loan, or (C) waiving any material right, whether in equity or at
law, that it has with respect to any Loan; or




     (xv) directly or indirectly agree or commit to take any of the foregoing
actions.




     (c) From the date of this Agreement through the Closing Date, Seller will not, and will
not cause or allow the Branches to, distribute or deliver any marketing materials to the
customers of the Branches without consulting with the Buyer other than customary marketing
materials in the Ordinary Course of Business.



     6.2 Notice of Potential Material Adverse Effect. Seller will give prompt written notice to Buyer of any fact or circumstance which would
result in a Seller Material Adverse Effect, or cause a breach or threatened breach of any of the
representations and warranties in Article 3 or 4 above. Buyer will give prompt
written notice to Seller of any fact or circumstance which would result in a Buyer Material Adverse
Effect or cause a breach or threatened breach of any of the representations and warranties in
Article 5.



     6.3 Reasonable Access. Buyer, its vendors and agents shall be given onsite access to the Branches, both during and
outside of normal business hours, as reasonably necessary or appropriate beginning within five (5)
calendar days following the execution of this Agreement to investigate the Branches’ properties,
books, contracts, commitments, records, operations and conditions (financial or otherwise) and
inspect, among other things, the Seller’s Books and Records; provided that such
investigation shall be related to the Acquisition and shall not interfere materially or
unnecessarily with the Branches’ normal operations. Buyer shall, and



46









 




shall cause its advisors and
agents to, maintain the confidentiality of all confidential information furnished to it and shall
not use such information for any purpose except in furtherance of the Acquisition. Within five (5)
calendar days of the execution of this Agreement, Buyer shall be permitted, at its expense, to
install and test voice and data communication lines and WAN, both internal and external, from each
Branch and prepare for the installation of hardware and software; provided that such
installation and testing shall be conducted at mutually agreeable times and so as to minimize, to
the extent reasonably practicable, interference with Seller’s operation of its business. If this
Agreement is terminated, Buyer shall promptly return or certify the destruction of all documents
and copies thereof and all work papers containing confidential information received pursuant to
this Section 6.3 concerning the Branches. Seller shall allow Buyer to remove the Seller’s
Books and Records for purposes related to the Acquisition, subject to such reasonable restrictions
and limitations for confidentiality or security or other purposes as required by Seller.




     6.4 Press Releases. Prior to the Closing Date, the Parties will consult with each other as to the form and
substance of any press release or other public disclosure materially related to the Acquisition;
provided that no Party is prohibited from making any disclosure which its counsel deems
necessary or advisable in order to satisfy any requirements of Applicable Law or the rules of any
national securities exchange on which securities of a Party or Affiliate of a Party are listed, in
which case the Party making such public announcement or disclosure shall give prior written notice
to the other Party promptly after the disclosing Party is notified of the disclosure requirement.
Neither Party will be required to seek the other Party’s approval of any public notice required for
any required regulatory filing.



     6.5 Exclusivity. From the date of this Agreement through the Closing Date, Seller will not and will cause
its Affiliates not to, directly or indirectly, (a) solicit, initiate, or encourage the submission
of any proposal or offer from any Person other than Buyer relating to the acquisition of any Branch
or any of the assets, properties or deposits thereof, except as otherwise permitted by Section
6.l(b) hereof (it being understood that Seller shall have the right to sell, without the
consent of Buyer, any Excluded Loan provided such Excluded Loan was originated prior to the date
hereof as contemplated by Section 6.18 hereof) or (b) participate in any discussions or
negotiations regarding, furnish any information with respect to, assist or participate in, or
facilitate in any other manner any effort or attempt by any Person to do or seek any of the
foregoing. Seller will notify Buyer immediately if any Person makes any proposal, offer, inquiry,
or contact with respect to any of the foregoing.



     6.6 Regulatory Matters and Approvals. Each of the Parties will cooperate and use Commercially Reasonable Efforts to promptly
prepare and file all necessary documentation, to effect all necessary applications, notices,
petitions, filings and other documents, and to obtain all necessary Governmental Authorizations.
Buyer shall file all requisite applications with the applicable Governmental
Bodies no later than thirty (30) calendar days after the date of this Agreement (and shall use
its Commercially Reasonable Efforts to file such applications not later than twenty (20) calendar
days after the date of this Agreement); provided that Seller has supplied to Buyer all
necessary Seller information required for such applications and Buyer shall have provided to Seller
a copy of each such application (excluding confidential sections thereof) not less than three (3)
Business Days prior to the date on which such application is to be filed. Buyer shall respond (and
Seller shall assist Buyer in responding) to all requests for information



47









 




from a Governmental Body
in a timely manner and shall use their respective Commercially Reasonable Efforts to respond to any
request within three (3) Business Days. Each of the Parties will (i) permit the other to review in
advance and, to the extent practicable, will consult with the other Party on all characterizations
of the information relating to the other Party which appear in any filing made with, or written
materials submitted to, any Governmental Body in connection with the Acquisition; and (ii) consult
with the other with respect to obtaining all Governmental Authorizations necessary or advisable to
consummate the Acquisition (unless prohibited by the applicable Governmental Body) and will keep
the other Party apprised of the status of matters relating to completion of the Acquisition. Each
of the Parties will promptly furnish the other Party with copies of all written communications
received by it, from, or delivered to, any Governmental Body in connection with and material to the
Acquisition, except for any confidential portions thereof and shall update the other party on any
non-written correspondence with Governmental Bodies relating to Governmental Authorizations.




     6.7 Employment.




     (a) Buyer may, but shall be under no obligation to, extend offers of employment as of
the Closing Date to (i) employees of Seller at the Branches and (ii) the Select Remote
Employees (such employees and Remote Select Employees, collectively, the “Potential
Employees”). Seller shall assist, and shall cause its Affiliates to assist, Buyer’s
solicitation of Potential Employees to accept employment with Buyer and/or Affiliates of
Buyer. From and after the date hereof through the Closing Date, Buyer may initiate contact
and engage in reasonable communication with Potential Employees, including, without
limitation, via electronic mail, physical delivery by mail or facsimile, or telephone or
in-person contact, and Seller shall use its reasonable efforts to assist in the facilitation
of such communications. Without limiting the foregoing, Seller shall permit Buyer to
contact and solicit the Potential Employees promptly after the date of this Agreement and
shall cooperate with Buyer to establish procedures for Buyer to interview the Potential
Employees and to provide Buyer with appropriate information relating to the Potential
Employees (including a copy of each such Potential Employee’s most recent performance review
and access to each such Potential Employee’s entire personnel and employment file, excluding
medical information unless such Potential Employee shall have otherwise consented to the
disclosure thereof to Buyer).




     (b) Buyer shall notify Seller at least thirty (30) days prior to the Closing which
Potential Employees Buyer desires to employ following Closing. Buyer agrees that, with
respect to each such Potential Employee to whom Buyer so desires to make an offer of
employment, Buyer shall (i) make such offer at least fifteen (15) days prior to the Closing
Date, and (ii) in the case of each Potential Employee receiving an offer and subject to the
other provisions of Section 7.13 hereof, offer to such individual (A) base
salary that is comparable to his or her base salary as of the date hereof and (B)
incentive compensation and health and welfare benefits that are substantially comparable to
the incentive compensation and health and welfare benefits offered by Buyer to similar level
employees within Buyer’s workforce as of the date of Buyer’s offer to such Potential
Employee. Potential Employees who accept offers of employment by Buyer prior to the Closing
Date and become employees of Buyer by reporting for work with Buyer on the first Business
Day following the Closing Date or within five (5) Business Days after the



48









 






Closing Date as
may be applicable to Potential Employees shall be referred to herein as “Retained
Employees.” All Retained Employees will be removed from Seller’s payroll effective as
of the Closing Date.




     (c) At Closing, (i) all wages and salaries, workers’ compensation payments, accrued and
unused vacation pay and social security and unemployment taxes of employees at the Branches
and Select Remote Employees (including Retained Employees) shall be paid by Seller for the
period prior to and including the Closing Date, and (ii) Seller will make all severance and
other payments and perform all obligations to Seller’s employees under any and all severance
or stay-pay agreements executed between Seller and the employees of the Branches. In
addition, on the Closing Date, Seller shall (X) compute all performance and incentive
bonuses and annual bonuses that a Retained Employee would otherwise be entitled to under any
existing formula-based performance or incentive agreement or other existing formula-based
bonus policy or arrangement applicable to such Retained Employee as though such Retained
Employee shall have completed his or her service for the current annual or other period as
to which such bonus relates (and a copy of such computation shall be delivered to Buyer at
least five (5) Business Days prior to the Closing Date), and (Y) pay to such Retained
Employee such bonus or incentive in an amount equal to the full amount of such bonus or
incentive for such annual or other period multiplied by a fraction, the numerator of which
shall be the number of days from the beginning of such annual or other period and ending on
the Closing Date and the denominator of which shall be the total number of days in such
annual or other period.




     (d) Nothing contained herein shall (i) confer upon any former, current or future
employee of Seller or its Affiliates or Buyer or its Affiliates or any legal representative
or beneficiary thereof any rights or remedies, including, without limitation, any right to
employment or continued employment of any nature, for any specified period, or (ii) cause
the employment status of any former, present or future employee of Buyer or its Affiliates
to be other than terminable at will.




     (e) Prior to the Closing Date, Seller and Buyer shall cooperate in order to permit
Buyer to train Potential Employees, and Seller shall, as scheduled by Buyer for reasonable
periods of time and subject to Seller’s reasonable approval, excuse such employees from
their duties at the Branches for the purpose of training and orientation by Buyer. Buyer
agrees to reimburse Seller for any out-of-pocket overtime expenses of Seller for Potential
Employees if such training is not available during Seller’s normal business hours for the
Branches.




     (f) If for any reason the Acquisition is not consummated, in consideration of the
access to and information regarding Seller’s employees, for a period of two (2) years
following date of this Agreement, Buyer and its Affiliates shall not solicit for employment
any Potential Employee or any of Seller’s other employees, without the prior consent of
Seller; provided, however, that the foregoing shall not apply to responses
to or follow-up hiring in respect of general solicitations or advertisements for job
positions not specifically directed to the Potential Employees or Seller’s other employees.



49









 





     6.8 Conveyance of Customer Accounts.




     (a) Deposit and Loan Accounts. The Parties specifically acknowledge that Buyer
has the regulatory duty for all communications regarding any change in terms of Deposit and
Loan agreements. In the event Buyer desires to change any such terms effective as of the
Closing Date, Buyer shall have the right to distribute written communications to such
customers prior to the Closing; provided, however, that Buyer shall provide
proposed written communications for the Loan and Deposit customers of the Branches to Seller
five (5) Business Days prior to Buyer’s scheduled mailing or other provision of such notices
for Seller’s review and approval. Such written communications shall be mailed at Buyer’s
expense and shall be mailed or otherwise provided to Loan and Deposit customers of the
Branches at Buyer’s sole discretion.




     (b) Loans. On the Closing Date, title to the Loans shall be transferred from
Seller to Buyer by a Bill of Sale, together with an assignment of notes and liens for real
estate and other secured loans. Seller shall provide Buyer with a Limited Power of Attorney,
in the form of Exhibit C, to effectuate the assignment of the Loans (including the
security interest in all collateral therefor). Seller will also endorse or execute an
allonge with respect to each note to Buyer, “without recourse” and, except as otherwise
specifically provided in this Agreement, without warranties except for warranties regarding
title thereto and right and authority to transfer. Seller will cooperate with Buyer and
shall execute any other assignment documents (including mortgage assignment and UCC
financing statement assignment documents and forms) that Buyer may reasonably request that
are acceptable for filing or recording in accordance with any applicable law. Preparation of
such additional documents shall be Buyer’s responsibility and at Buyer’s expense; all
recording fees and expenses related to the recordation of the assignments shall be the
responsibility of Buyer.




     (c) Other Notices Provided by Seller to Customers. Notices provided by Seller
to customers of the Branches after the date of this Agreement until the Closing related to
the transaction contemplated by this Agreement shall be provided by Seller to Buyer prior to
distribution for Buyer’s prior written approval, which approval shall not be unreasonably
withheld. For purposes of this Agreement, the term “customers” includes borrowers under the
Loans.




     (d) General Communications by Buyer to Customers. In addition to the duties
and rights of Buyer under clause (a) of this Section 6.8 to communicate with
customers, from and after the date of this Agreement, Buyer shall have the right to deliver
communications to the customers of the Branches, by mail or electronically or otherwise,
one or more communications regarding the pending Acquisition and the transition of
ownership of the Branches (including a general introductory letter welcoming such customers
to banking with Buyer), subject to the prior written approval of Seller (which approval
shall not be unreasonably withheld, delayed or conditioned).



     6.9 Branch Access. Seller shall provide physical access to space within each Branch facility to Buyer at least
thirty (30) days prior to the Closing Date for equipment staging inside the Branch relating to the
conversion; such access not to be unduly disruptive to the Branch.



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     6.10 Maintenance of Properties. From the date of this Agreement and until the Effective Time, Seller will maintain the
Branches in their current condition, ordinary wear and tear excepted consistent with the standard
of maintenance Seller uses in its Non-Divested Branches.



     6.11 Conversion Planning and Execution. From the date of this Agreement until the Effective Time, Seller will provide reasonable
cooperation with and assist Buyer in planning a conversion to transition the business of the
Branches from Seller to Buyer including the transition of Seller’s electronic data (including data
delivered pursuant to ancillary delivery channels, such as internet banking and bill pay, debit
card and credit card and all other systems determined beyond the CBS/Signature system) to an
electronic file format mutually agreeable to both Parties on the Closing Date. Each Party shall
pay its own cost relating to such conversion. Within seven (7) Business Days (or, in the case of
Buyer’s initial request as contemplated by this sentence, three (3) Business Days except with
respect to commercial online banking customers on the Fundtech system) of up to each of four (4)
separate requests of Buyer, Seller agrees to provide Buyer a complete set of data files/conversion
tapes prior to the final set of data files/conversion tapes for the purposes of implementing the
conversion as of the Closing Date (such conversion data files to include, among other things, the
loan, deposit, CIF and other application systems processed on CBS/Signature and in the native
CBS/Signature file format and other data files for systems other than the CBS/Signature System,
including, but not limited to, internet banking and bill pay, debit card and credit card). On the
Closing Date, Seller shall provide a final set of data files/conversion tapes contemplated in this
Section 6.11 to Buyer as of such date regardless of the number of requests for such
information and material made by Buyer pursuant to this Section 6.11. Further, Seller
agrees that it will inform Buyer of required changes to record layouts that may be necessary in the
Ordinary Course of Business, and Buyer and Seller agree to cooperate on timely making such required
modifications; provided, however, that in the event such changes are made by
Seller, Seller shall provide to Buyer any additional files required by Buyer to support Buyer’s
testing of such changes not later than three (3) Business Days following Buyer’s request therefor
(except with respect to commercial online banking customers on the Fundtech system). The Parties
shall comply with their respective conversion-related responsibilities as set forth on Schedule
6.11; provided that such schedule may be revised and updated as reasonably requested by
Buyer from time to time as necessary to effect the intent of this Section 6.11.



     6.12 General Third Party Consents. From the date of this Agreement until all Landlord Consents and other Consents are
obtained, Seller and Buyer shall cooperate with all reasonable requests of each other, and Seller
shall use Commercially Reasonable Efforts, to obtain (i) all Landlord Consents to transfer Seller’s
rights as lessee to each Leased Real Property (including those rights that are personal to Seller
pursuant to the respective Lease) to Buyer, and (ii) all other Consents (other than Regulatory
Approvals, as to which the provisions of Section 6.6 shall apply) as shall be required
under the terms of any Contract or applicable law to transfer and assign to Buyer on the Closing
Date the Acquired Assets and the Assumed Liabilities. If Seller is unable to obtain a Landlord
Consent with respect to a Lease, and Buyer and Seller fail to reach an agreement within thirty (30)
calendar days after receipt of the landlord’s indication that a Landlord Consent will not be
granted in form and substance reasonably satisfactory to Buyer and Seller, then Buyer may elect to
exclude the applicable Leased Real Property (and the Lease thereto) from the Acquisition, and the
Payment Amount shall be reduced accordingly. Buyer



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agrees to assume the Deposits for any Branch
excluded from the Acquisition pursuant to this Section 6.12, subject to Buyer’s or Seller’s
ability to satisfy all applicable regulatory requirements.




     6.13 Title Insurance and Surveys. Within forty-five (45) days after the date of this Agreement, Seller will provide Buyer, at
Seller’s expense, with an ALTA 2006 standard form owner’s commitment (containing the endorsements
described in Section 8.1(e) below) for title insurance with respect to each parcel of real
property comprising the Owned Real Property (including legible copies of all documents, instruments
or agreements evidencing or creating the exceptions referenced in such commitment to the extent
available from the public records) from Chicago Title Insurance Company and an ALTA/ACSM Land Title
Survey prepared in accordance with the 2005 minimum requirements therefor as adopted by American
Land Title Association and the National Society of Professional Surveyors (prepared and certified,
in form reasonably acceptable to Buyer as to all matters shown thereon, by a surveyor licensed by
the State of Illinois and reasonably acceptable to Buyer, which shall include a notation stating
whether or not a portion of the premises are located in a 100 year flood plain, flood-prone area of
special flood hazard and if so, depicting the location of such flood-prone area of special flood
hazard). With respect to any such parcel or parcels of real property collectively comprising the
Owned Real Property used for any single Branch location (each, an “Owned Location”), Buyer
shall have fifteen (15) Business Days after the receipt of the commitment for title insurance and
the land title survey applicable to any such Owned Location to object, in writing, to the
exceptions or other matters contained therein if and only if such exceptions or matters would, in
Buyer’s reasonable discretion, (i) materially impair the use or occupancy (consistent with current
use or occupancy) of the applicable Owned Location as a banking branch, or (ii) cost, at such Owned
Location, more than $150,000 to remediate, cure or correct (it being agreed that if such exception
or matter is not capable of being cured, remediated or corrected, the cost to cure, remediate or
correct such exception or matter shall be deemed to exceed $150,000) (any of item (i) or (ii), an
“Objectionable Title Matter”). Buyer shall not have the right to object to any exceptions
or other matters contained in the commitment for title insurance and/or the land title survey
applicable to any such Owned Location, except for Objectionable Title Matters; by way of
clarification and not limitation, Objectionable Title Matters shall not include exceptions for
current taxes not delinquent, printed
exceptions in the commitment generally contained in any owner’s standard coverage policy of
title insurance (except to the extent that the same may be removed by a customary owner’s affidavit
from Seller or any other customary delivery reasonably requested by the title company), or rights
of government entities to make cuts and fills in connection with construction and/or maintenance of
any public roadways adjoining the real property and easements and reservations of record that do
not prevent or materially impair the use of such parcel of real property for general banking
purposes. If Buyer gives timely notice of its objection to any Objectionable Title Matter, Seller
shall have the opportunity (but not the obligation) for ten (10) days from the date of Buyer’s
notice to cure such objection (which cure may include, to the extent expressly consented to by
Buyer in its sole discretion, a written undertaking (with collateral, if required) on the part of
Seller to cure such objection prior to Closing). If the Seller shall have failed to cure, to the
reasonable satisfaction of Buyer, any Objectionable Title Matter to which Buyer’s objections were
timely made as provided in this Section 6.13 with respect to any such Owned Location, then
Buyer may elect to exclude the applicable parcel or parcels of Real Estate Interests from the
Acquisition (along with, if such parcel of Real Estate Interests is material to the operation of
any Owned Location as determined



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in the sole, reasonable discretion of Buyer, any other parcel of
Real Estate Interests applicable to such Owned Location), and the Payment Amount shall be reduced
accordingly. Buyer agrees to assume the Deposits for any Branch excluded from the Acquisition
pursuant to this Section 6.13, subject to Buyer’s or Seller’s ability to satisfy all
applicable regulatory requirements.




     6.14 Insurance Proceeds and Casualty Payments. In the event of any damage, or destruction affecting the Acquired Assets between the date
hereof and the time of the Closing, Seller shall deliver to Buyer notice of such damage or
destruction and, at Buyer’s election, shall either fix or repair such damage or destruction (which
repair must be completed prior to the Closing Date in accordance with Applicable Laws and in a
workmanlike manner, using materials consistent with the quality of the damaged or destroyed
materials) or pay to Buyer the insurance proceeds, to the extent of the applicable amount set forth
in Section 2.2(a) hereof with respect to the Owned Real Property and Leasehold
Improvements, and the replacement cost with respect to the Acquired Tangible Personal Property as
the case may be, received (or with respect to insurance proceeds, which would be received assuming
Seller’s insurance policy had no deductible) by Seller as a result thereof; provided,
however, that Buyer shall have the right to terminate this Agreement in the event that the
Book Value of such Acquired Assets so damaged or destroyed is in excess of $100,000, unless Seller
agrees to pay Buyer the difference between the Fair Market Value of such Acquired Assets and the
insurance proceeds. The terms and conditions of this Section 6.14 shall supersede entirely
the provisions of the Uniform Vendor and Purchaser Risk Act, as enacted in Illinois; Buyer hereby
waives any termination rights that it may have under said Uniform Vendor and Purchaser Risk Act.



     6.15 Environmental Reports and Investigations. Consistent with Section 4.9(k) hereof, within ten (10) Business Days following the
date of this Agreement, Seller will furnish Buyer with true and complete copies of all
environmental assessments, reports, studies, surveys and other similar documents or information,
including, without limitation, related correspondence, in its possession or control relating to
each of the
Real Estate Interests. Buyer shall be entitled to conduct a Phase I Environmental Assessment
and an assessment of Hazardous Materials and compliance with Environmental Laws (collectively,
“Phase I Environmental and Hazardous Materials Assessment”), at Buyer’s sole expense, for
any of the Owned Real Properties upon one (1) Business Day’s notice to Seller. Buyer shall also be
entitled to conduct a Phase I Environmental and Hazardous Materials Assessment, at Buyer’s sole
cost and expense, of any Leased Real Property, only upon receipt of written approval from the
landlord for that Leased Real Property. In addition, if a Phase I Environmental Assessment
identifies any Recognized Environmental Conditions for any Owned Real Property, Buyer shall have
the right, at any time prior to Closing, to conduct, at Buyer’s sole cost and expense, a Phase II
Environmental Assessment to investigate any Recognized Environmental Conditions identified in any
Phase I Environmental Assessment report for such Owned Real Property. Buyer’s work plans for any
Phase I Environmental and Hazardous Materials Assessment or any Phase II Environmental Assessment
conducted pursuant to this Section 6.15 shall be subject to Seller’s approval, which
approval shall not be unreasonably withheld, delayed or conditioned, and Buyer shall, at its sole
cost and expense, repair and/or correct any damage to the subject property resulting from the work
conducted by Buyer or its contractors in connection with any such assessment. If a Phase I
Environmental Assessment identifies any Recognized Environmental Conditions for any Leased Real
Property upon the written consent by the landlord, Buyer shall have the right, at any time prior to
Closing, to conduct, at Buyer’s sole cost and expense, a Phase II Environmental



53









 




Assessment to
investigate any Recognized Environmental Conditions identified in any Phase I Environmental
Assessment report for any Leased Real Property. All such Phase II Environmental Assessments shall
be conducted by an independent environmental investigation and testing firm selected by the Buyer.
Buyer will notify Seller no fewer than five (5) Business Days in advance of its desire to conduct a
Phase II Environmental Assessment at any Owned Real Property, and upon receipt of such notice
Seller will grant Buyer access to the Owned Real Property for such investigation. With respect to
the Leased Real Properties, Buyer will notify Seller no fewer than five (5) Business Days in
advance of its desire to conduct either a Phase I Environmental and Hazardous Materials Assessment
or a Phase II Environmental Assessment at any Leased Real Property and Seller shall use its
Commercially Reasonable Efforts to obtain written permission from the landlord for that Leased Real
Property for Buyer to conduct such investigations. If any Phase I Environmental and Hazardous
Materials Assessment or any Phase II Environmental Assessment confirms the existence of a condition
which could be subject to Liability under applicable Environmental Laws, and the aggregate costs of
remediating such conditions are reasonably estimated by Buyer’s consultant not to exceed $25,000
with respect to any single Branch, then Buyer shall purchase the Owned Real Property, or accept an
assignment of the Leases, relating to such Branch on the terms set forth in Section 2.2 and
shall assume liability for such condition except as otherwise contemplated by Section
2.1(c)(iv) hereof. If (i) the costs of remediation any such condition with respect to any
single Branch are reasonably estimated by Buyer’s consultant to exceed $25,000 for such single
Branch and Buyer and Seller fail to reach an agreement with respect to such remediation within
thirty (30) calendar days after receipt of the estimated remediation costs (or, if less, within the
period beginning on the date of receipt of the report regarding the estimate of such costs and
ending ten (10) Business Days prior to the Closing Date), or (ii) access to conduct a Phase I
Environmental and Hazardous Materials Assessment or a Phase II Environmental Assessment is not
given to Buyer or its representatives, in the case of a Phase I Environmental and Hazardous
Materials Assessment, at least forty-five (45) Business
Days prior to the Closing Date, and in the case of a Phase II Environmental Assessment, at
least twenty (20) Business Days prior to the Closing Date, then, in each case, Buyer may elect to
exclude the applicable parcel or parcels of Real Estate Interests from the Acquisition (along with,
if such parcel of Real Estate Interests is material to the operation of any single Branch as
determined in the sole, reasonable discretion of Buyer, any other parcel of Real Estate Interests
applicable to such single Branch, whether Owned Real Property or Leased Real Property), and the
Payment Amount shall be reduced accordingly. Buyer agrees to assume the Deposits for any Branch
excluded from the Acquisition pursuant to this Section 6.15, subject to Buyer’s or Seller’s
ability to satisfy all applicable regulatory requirements. During the period between the date
hereof and the Closing Date (and, if the Closing shall not occur, at all times thereafter), Buyer
and its employees, agents and representatives shall hold all contents of any Phase I Environmental
Assessment and Phase II Environmental Assessment reports confidential and disclose the contents
thereof only with prior written consent of Seller or as may be required under applicable law.
During the period between the date hereof and the Closing Date (and, if the Closing shall occur, at
all times thereafter), Seller and its employees, agents and representatives shall hold
 all contents
of any Phase I and Phase II reports confidential and disclose the contents thereof only with prior
written consent of Buyer or as may be required under applicable law. Buyer shall deliver to Seller
a true, correct and complete copy of the results of any Phase I Environmental and Hazardous
Materials Assessment and any Phase II Environmental Assessment conducted by Buyer pursuant to this
Section 6.15 in respect of any




54









 







Owned Real Property or Leased Real Property (together with
any attachments thereto) not later than five (5) Business Days following receipt thereof by Buyer.
Buyer shall not disclose to or solicit any Governmental Body regarding the investigation or
remediation of Hazardous Materials identified in Buyer’s Phase I Environmental Assessments or Phase
I Environmental and Hazardous Materials Assessments, Phase II Environmental Assessments, or items,
reports or conditions identified on Schedule 4.9(a) or 4.9(g) hereof or the
documents (or attachments to the documents) referenced on Schedule 4.9(a) or 4.9(g)
hereof unless such disclosure is made in response to a written or oral request from a Governmental
Body or such disclosure is required by Applicable Law.




     6.16 Condemnation. If prior to Closing all or any portion of the Real Estate Interests is taken or is made
subject to eminent domain or other governmental acquisition proceedings, then Seller shall promptly
notify Buyer thereof, and on the Closing Date pay to the Buyer all payments received in respect
thereto (or to be received after the Closing Date in the event payment has not been made by the
applicable Governmental Body prior to the Closing Date); provided, however, that
the Buyer shall have the right to terminate this Agreement in the event that the Book Value of the
portion of the Real Estate Interests and improvements so taken or made subject to eminent domain is
in excess of $50,000, unless Seller agrees to pay Buyer the difference between the Fair Market
Value of such portion and the condemnation award.



     6.17 Exclusion of Non-Core Deposits. Buyer may, at anytime prior to the Closing, exclude in its sole discretion from the
Deposits to be assumed any Non-Core Deposit. On or before the fortieth (40th) day prior
to the Closing Date, Seller shall provide to Buyer a list of all Non-Core Deposits originated on
and prior to the date of delivery of such list, and Seller shall send to Buyer a supplemental list
(i) on the fifteenth (15th) day prior to the Closing Date and (ii) on the day prior to the Closing
Date (prepared as of the close of business on such day), which supplemental lists shall list all
Non-Core Deposits originated since the cut-off date of the Non-Core Deposit list most recently
delivered to Buyer pursuant to this Section 6.17. On or before the date that is ten (10)
days prior to the Closing Date, Buyer shall deliver to Seller a list of excluded Non-Core Deposits
as of such date and shall, no later than 9:00 a.m. on the morning of the Closing, deliver to Seller
a final list of all excluded Non-Core Deposits.



     6.18 Additions to Loans; Removal of Certain Loans. Prior to the Closing Date, Buyer may, in its sole discretion, include on Schedule
1.1 any loan, loan participation or Commitment originated by Seller and attributable to the
Branches (“New Loan”), whether such New Loan was originated prior to the date hereof and
not included on Schedule 1.1 as of the date hereof or originated after the date hereof.
Any such New Loan added to Schedule 1.1 shall be deemed a Loan for purposes of this
Agreement. Buyer will notify Seller on or before the 30th day prior to the Closing Date
of any New Loan that Buyer intends to add to Schedule 1.1; provided,
however, the Parties agree that New Loans may be added to Schedule 1.1 after the
30th day prior to the Closing Date. In addition, Buyer may, (i) by the giving of
written notice to the Seller at least five (5) Business Days prior to the Closing Date, remove from
Schedule 1.1 any Loan that Seller determines, in its reasonable good faith judgment,
constitutes as of such date or will constitute as of the Closing Date a Non-Conforming Loan, in
which case such Non-Conforming Loan shall be deemed removed from Schedule 1.1 and for all
purposes of this Agreement shall be deemed to constitute an Excluded Loan, and (ii) by the giving
of written notice (the “Special Acceptance Notice”) to Seller at least five (5) Business
Days prior to the Closing Date, agree to accept and



55









 




purchase any Loan that constitutes as of such
date or will constitute as of the Closing Date a Non-Conforming Loan, in which case such
Non-Conforming Loan shall be deemed to be a Loan for all purposes of this Agreement and included on
Schedule 1.1 (it being understood that Seller has the right to sell, without Buyer’s
consent, to any third party any Excluded Loan that was originated prior to the date hereof as
contemplated by Section 6.5 hereof unless Buyer shall have delivered a Special Acceptance
Notice with respect thereto prior to the date Seller shall have agreed to sell such Excluded Loan
to such third party). Notwithstanding anything to the contrary contained herein, any
Non-Conforming Loan that Buyer accepts pursuant to the Special Acceptance Notice shall remain
subject to the provisions of Section 2.6 from and after the Closing Date to and including
the Cut-Off Date, and Buyer shall have the right, at its election, to put back to Seller such
Non-Conforming Loan during such period pursuant to the provisions of Section 2.6.




     6.19 Subordination, Non-Disturbance and Attornment Agreements. Seller shall use its Commercially Reasonable Efforts to obtain subordination,
non-disturbance and attornment agreements (“SNDAs”) from the Landlord’s lenders holding
mortgages, deeds of trust or other liens against the Leased Real Property superior to the
applicable Leases (except that no such SNDA shall be required for any such Lease which is, as of
the date hereof, subject to an SNDA affording customary non-disturbance protection and which
contains successor and assigns provisions entitling Buyer to enjoy, as reasonably determined by
Buyer upon the advice of counsel, the benefits thereof upon the assignment to
Buyer of such Lease), which SNDAs shall be on forms provided by Landlord’s lenders;
provided, however, that Buyer may, at its sole cost and expense, elect to negotiate
SNDAs on forms other than those provided by the Landlord’s lenders.



     6.20 Assumption of IRA and Keogh Account Deposits.




     (a) With respect to Deposits in IRAs, Seller will use Commercially Reasonable Efforts
and will cooperate with Buyer in taking any action reasonably necessary to invite depositors
of IRAs to accomplish the appointment of Buyer as successor custodian of all such IRA
deposits (except self-directed IRA deposits), including, but not limited to, sending to the
depositors thereof appropriate notices, cooperating with Buyer in soliciting consents from
such depositors, and filing any appropriate applications with applicable Governmental
Bodies. The expenses payable to third parties associated with Buyer’s efforts to assume
IRAs shall be borne by Buyer.




     (b) With respect to Deposits in Keogh Accounts, Seller shall use Commercially
Reasonable Efforts and cooperate with Buyer to invite depositors thereof, at Buyer’s sole
expense, to direct a transfer of each such depositor’s Keogh Account and the related
Deposits to Buyer (or an Affiliate of Buyer), as trustee thereof, and to adopt Buyer’s (or
such Affiliate’s) form of Keogh Master Plan as a successor to that of Seller. Buyer (or
such Affiliate) will not be required to assume a Keogh Account unless Buyer (or such
Affiliate) has received the documents reasonably necessary for such assumption at or before
the Closing. With respect to any owner of a Keogh Account who does not adopt Buyer’s form
of Keogh Master Plan, Seller will use Commercially Reasonable Efforts in order to enable
Buyer (or such Affiliate) to retain such Keogh Accounts at the



56









 






Branches. The expenses
payable to third parties associated with Buyer’s efforts to assume Keogh Accounts shall be
borne by Buyer.




     (c) If, notwithstanding the foregoing, as of the Closing Date Buyer shall be unable to
retain deposit liabilities in respect of an IRA or Keogh Account, such deposit liabilities,
which shall be set forth on Schedule 6.20(c) and delivered on, and prepared as of,
the Closing Date, shall be excluded from Deposits for purposes of this Agreement and shall
constitute “Excluded IRA/Keogh Account Deposits.”



     6.21 Naperville Branch. Buyer shall have the right, by the giving of written notice to Seller at least thirty (30)
days prior to the Closing Date, to reject and exclude from the Acquisition the Branch located at
3020 State Route 59 in Naperville, Illinois (the “Naperville Branch”), in which case the
Owned Real Property and all other Leased Real Properties associated with the Naperville Branch
shall be excluded from the Acquisition and the Payment Amount shall be reduced accordingly. Buyer
agrees to assume the Deposits for the Naperville Branch subject to Buyer’s or Seller’s ability to
satisfy all applicable regulatory requirements.



     6.22 Post-Signing Selection of Certain Excluded Tangible Personal Property. Not later than thirty (30) days following the execution and delivery hereof, Buyer shall
have the right, by the giving of written notice to Seller, to select for purchase at net book value
by Buyer at the Closing any item of Excluded Tangible Personal Property described in clause
(B) or (C) of Section 2.1(b)(i). In the event that Buyer selects to purchase any such
Excluded Tangible Personal Property, Buyer and Seller shall enter into an amendment of this
Agreement, including an amendment to Schedule 2.1(b)(i) hereof, for purposes of including
the Excluded Tangible Personal Property so selected by Buyer pursuant to such notice among the
Acquired Assets to be purchased hereunder.



ARTICLE 7

POST-CLOSING COVENANTS




     7.1 Continued Cooperation. The Parties agree in case at any time after the Closing any further action is necessary or
desirable to carry out the purposes of this Agreement, each of the Parties will take such further
action (including the execution and delivery of such further instruments and documents) as the
other Party reasonably may request, all at the sole cost and expense of the requesting Party
(unless such expense is otherwise allocated in this Agreement or the requesting Party is entitled
to indemnification therefore under Article 11 below).



     7.2 Transitional Matters Concerning Deposits.




     (a) Following the Effective Time and without limiting the generality of the other
provisions of this Agreement, Buyer will pay in accordance with law, customary banking
practices, and the respective terms of the Deposits and related Acquired Contracts all
properly drawn and presented checks, drafts and withdrawal orders (including, in all cases
under this Section 7.2, transactions initiated with debit cards used by the
Branches) with respect to the Deposit accounts presented to Buyer by mail, over the counter,
through the check clearing system of the banking industry or any other method of general
acceptance within the banking industry, whether such checks, drafts



57









 






and withdrawal orders
are on forms provided by Buyer or Seller, and in other respects to discharge, in the usual
course of the banking business, the duties and obligations of Seller with respect to the
Deposits.




     (b) Buyer agrees, at its cost and expense, to assign new account numbers effective as
of the Effective Time to all deposits of the Branches assumed by Buyer pursuant to the terms
of this Agreement and to furnish such depositors with checks on the forms of Buyer, and to
instruct such depositors to utilize Buyer’s newly furnished checks, drafts and withdrawal
order forms and cease using Seller’s checks, drafts and withdrawal forms previously supplied
by Seller.




     (c) Seller agrees that it will reimburse Buyer for the amount of any uncollectible
check, draft, or withdrawal order drawn on a Deposit to the extent such amount is incurred
by Buyer as a result of any failure by Seller after the Closing Date to expeditiously
return, revoke any prior settlement of, give notice of dishonor or nonpayment of, or
otherwise reject, before the applicable midnight deadline or other applicable deadline, any
check, draft or withdrawal order drawn on Seller with regard to the deposit account and
presented to Seller before the Closing Date, that is not properly
payable due to insufficient funds in the applicable deposit account, an outstanding
stop payment order, or a forged check. Should any of the Branches “due from” accounts be
charged any sums with respect to any of the Deposits by reason of a forged endorsement or
otherwise (hereinafter the “Reclaimed Amount”), then Buyer as assignee of such
Deposit shall forthwith upon request by Seller assert a right of setoff against such Deposit
for the whole amount of the Reclaimed Amount or such portion thereof that may be on deposit
with Buyer in such Deposit account from time to time, and shall remit such sums to Seller
forthwith thereafter, in accordance with this Section 7.2.




     (d) Buyer agrees that it will reimburse Seller for the amount of any uncollectible
check, draft, or withdrawal order drawn on a Deposit to the extent such amount is incurred
by Seller as a result of any failure by Buyer after the Closing Date to expeditiously
return, revoke any prior settlement of, give notice of dishonor or nonpayment of, or
otherwise reject, before the applicable midnight deadline or other applicable deadline, any
check, draft or withdrawal order drawn on Seller with regard to the Deposit account and
presented any date after the Closing Date, that is not properly payable due to insufficient
funds in the applicable deposit account, an outstanding stop payment order or otherwise.




     (e) With respect to any Deposit that has a negative balance as of the close of business
on the Closing Date due to an overdraft caused by Seller’s final payment and settlement, on
or before the Closing Date, of one or more checks, drafts or other items drawn against such
account, other than any Deposit account that has been excluded as an asset or liability
being acquired or assumed under the terms of this Agreement (the “Overdraft Items”),
which negative balance continues to exist at the close of business on the fifth day after
the Closing Date after exercise by Buyer of any setoff rights of which Buyer is aware, Buyer
shall be entitled to reimbursement in immediately available funds from Seller for the amount
of any such negative balance of which Buyer gives Seller notice within fifteen (15) days
after the Closing Date. Thereafter, Buyer shall continue as



58









 






Seller’s agent, for a period of
sixty (60) days after the Closing Date, or such shorter period as Seller shall request, to
assert set off rights and promptly forward the amount set off to Seller in immediately
available funds. Buyer shall immediately deliver to Seller all Overdraft Items in Buyer’s
possession (if any) for which it demands reimbursement and any payments or amounts received
in respect thereof from time to time, and Seller shall be vested with all rights, title and
interest in, to and in connection with such Overdraft Items which Buyer otherwise would have
had, and Seller shall be entitled to enforce and collect all rights, remedies, claims, and
causes of action against all persons and entities, including, without limitation, the drawer
and depositor(s) which Seller or Buyer shall have or would have had in connection with the
Overdraft Item.




     (f) Seller and Buyer shall make arrangements to provide for the daily settlement with
immediately available funds by Buyer of checks, drafts, withdrawal orders, debit card
trailing activity and returns presented and paid by Seller for the period between the
Closing Date and sixty (60) days following the Closing Date drawn on or chargeable to
accounts in respect of Deposits assumed by Buyer hereunder; provided,
however, Seller shall be held harmless and indemnified by Buyer for funds not
reimbursed by Buyer for Seller acting in accordance with such arrangements. Buyer shall
be responsible for any costs incurred for courier or overnight shipping of information
related to the daily settlements. At any time prior to the expiration of the sixty (60)
days referenced herein, Seller shall discontinue such payments on behalf of Buyer upon
written request by Buyer. Any checks, drafts, withdrawal orders, trailing debit card
activity and returns presented to Seller following the expiration of the sixty (60) day
period, shall be returned by Seller.




     (g) Starting on the Business Day following the Closing Date or as otherwise expressly
agreed by the Parties, Seller, at its expense, shall notify all Automated Clearing House
(“ACH”) originators of the transfers and assumptions and retention of deposits made
pursuant to this Agreement by sending a notification of change (NOC) as transactions are
presented; provided, however, that Buyer may, at its option, notify all such
originators itself (on behalf of Seller), also at Seller’s expense. For the sixty (60) day
period immediately following the Closing Date, Seller will, without any obligation to
investigate the accuracy of such request or the balance in the accuracy of such request or
the balance in the underlying account, honor all ACH items related to accounts assumed under
this Agreement that are routed or presented to Seller, and Buyer will reimburse Seller for
all such ACH payments on a daily basis. Seller will not charge any fee to Buyer for
honoring such items and will electronically transmit such ACH to Buyer. If Buyer cannot
receive such electronic transmissions, Seller will make available to Buyer, at Seller’s
operation center, receiving items from the ACH tapes containing such ACH data. Following
the sixty (60) day period referenced herein, Seller will not honor any ACH item presented to
Seller unless Buyer has requested that Seller extend the time for clearing ACH items. Upon
such request, in the event that Seller agrees to such an extension of time, Buyer shall pay
Seller a One Dollar ($1.00) fee per transaction cleared during the extension period and
Buyer and Seller must agree, in writing, to the duration period; provided,
however, any extension period will not be greater than sixty (60) days. If no
extension period is agreed to by the Parties, items mistakenly routed or presented to Seller
after the sixty (60) day period will be returned to the presenting party. At any time



59









 






prior
to the initial sixty (60) days or prior to the ending date of any extension period, Seller
shall discontinue honoring ACH items upon the written request of Buyer.




     (h) On the Closing Date, Seller shall provide Buyer with a written listing and
electronic data file of each stop payment order, tax lien, levy, garnishment, pledge,
guardianship agreement, or other hold or restriction then in effect with respect to any of
the Deposits (the “Holds”), and Buyer shall honor and comply with the terms of all
valid Holds described in the above list. If, following receipt of such list, Buyer makes
any payment in violation of any such Hold, then it shall be solely liable for such payment
and shall indemnify, hold harmless, and defend Seller from and against all claims, losses
and liabilities, including reasonable attorneys’ fees and expenses, arising out of any such
payment. In the event that Buyer shall make any payment in violation of a Hold initiated
prior to the Closing Date but not reflected in the above list, then Seller shall be solely
liable for such payment and shall indemnify, hold harmless and defend Buyer from and against
all claims, losses, and liabilities, including reasonable attorneys’ fees and expenses,
arising out of any such payment.




     (i) On the Closing Date, Seller shall cycle, prepare and pay all accrued interest for
each checking, savings or money market account constituting a Deposit. Seller shall mail
such closing statements within five (5) Business Days following the Closing Date, and
contemporaneously therewith provide Buyer with a true and correct copy thereof. Interest on
time deposits shall be accrued and included in the data conversion files.




     (j) Within thirty (30) days from this Agreement, Seller and Buyer shall establish a
mutually agreeable post-conversion trailing activity process for settlement of converted
account activities relating to trailing transactions.



     7.3 Transitional Matters Concerning Loans. As soon as reasonably practicable following the Closing, Buyer, at its expense, will issue
new coupon or payment books for the Loans and will instruct customers to destroy any coupons
furnished by Seller; Buyer will also notify customers of any applicable change in terms and provide
Buyer’s information for payment remittance. For a period of sixty (60) days following the Closing,
Seller will forward to Buyer on a daily basis all loan payments received by Seller, in the form
received by Seller, or as established in the post-conversion activity process referenced in
Section 7.2(i). After such sixty day period, Seller will forward any loan payments
received on a weekly basis.



     7.4 Transitional Matters Concerning Real Estate Interests. For a period of sixty (60) days following the Closing, Seller will forward to Buyer on a
daily basis all material correspondence, notices, documents or other instruments received by Seller
relating to the Real Estate Interests within two (2) Business Days following receipt thereof.
After such sixty (60) day period, Seller will forward any such material correspondence, notices,
documents or other instruments received on a weekly basis.



     7.5 Transfer of Books and Records. As soon as commercially reasonable following the Closing Date, but in no event later than
five (5) Business Days after the Closing Date, Seller



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shall provide the following documents which
are in possession of Seller in connection with or relating to the Acquired Assets and the Assumed
Liabilities (the “Books and Records”):





     (a) Loan Documents and Records:




     (i) Originals (or in alternative form, if originals are unavailable) of all
documents retained by Seller in its Ordinary Course of Business or otherwise in its
possession evidencing or supporting each Loan, including recorded mortgages and
deeds of trust, recorded assignments, promissory notes, loan applications, loan
closing statements, extension agreements, financing statements, security agreements,
loan agreements, guaranties and guaranty agreements, loan commitments, letters of
credit, title insurance commitments and policies, environmental survey reports,
flood certifications, borrower financial statements, motor vehicle and trailer
titles, appraisals, evidence of receipt by the debtor or
mortgagor of disclosure statements, material correspondence, all default
notices given or received and any notices from a Governmental Body; and




     (ii) An electronic database (or paper records, if an electronic database is not
available) reflecting the payment history, balances and other relevant information
respecting all Loans.




     (b) Deposit Records: Originals (or an alternative form, if originals are
unavailable) of all documents retained by Seller in its Ordinary Course of Business or
otherwise in its possession evidencing or supporting each Deposit, including signature
cards, taxpayer identification number certifications, deposit account agreements, account
opening documentation, and trust or other legal documentation gathered as supporting
evidence of authorization to establish a Deposit account.




     (c) Other Records: Originals (or an alternative form, if originals are
unavailable) of all documents retained by Seller in its Ordinary Course of Business or
otherwise in its possession that may be reasonably related to the Acquired Assets or the
operation of the Branches that are located on the Branch premises either in paper or
electronic form, including investment customer records, safe deposit records, currency
transaction reports, suspicious activity reports, and debit card transaction records and,
including, without limitation, all notices given or received in connection with any Real
Estate Interest.




     (d) Buyer Review of Records: Within one hundred eighty (180) days of receipt
of such records by Buyer, Buyer shall notify Seller of any deficiencies in the information
provided. Seller will cure such deficiencies at Seller’s expense. For requests more than
one hundred eighty (180) days after Seller has provided such records to Buyer, Seller will
permit Buyer, for reasonable cause, at Buyer’s expense, to examine, inspect, copy and
reproduce files, documents or records retained by Seller relating to the assets and
liabilities transferred under this Agreement.




     (e) Form of Records: Buyer acknowledges that some of Seller’s documents
(except with respect to the Loans, as to which Seller’s representations and warranties




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contained in Section 4.10(d)(vii) apply) and records may be available only in
the form of photocopies, file copies or other non-original and non-paper media, and
represents and warrants to Buyer that the failure to provide Buyer with such originals will
not result in any material diminution in value of the asset or other item as to which such
non-original shall relate.



     7.6 Electronic Records, Conversion, and Servicing.




     (a) From and after the Effective Time, Buyer shall service customer account inquiries
and other third party requests for historical information owned by Seller and transferred to
Buyer in a physical or electronic form on or after the Closing Date (the “Transferred
Records”).




     (b) From and after the Effective Time, each party to this Agreement agrees to cooperate
with the other party in responding to any reasonable request for information regarding or
contained in the Books and Records. Buyer shall make available the Transferred Records and
Seller shall make available the retained records, for inspection by the other Party, as
applicable, during normal business hours of each, after reasonable prior notice, and each
Party may, at their respective expense, have copies made of excerpts from the retained
records or the Transferred Records, as each may deem necessary. The requesting Party shall
be responsible for any expenses relating to such request, including reasonable research fees
charged by the other Party; provided, however, that Buyer shall not be
responsible for any such expenses incurred by Seller pursuant to this provision until
sixty-one (61) days or more after Closing.




     (c) From and after the Effective Time, Buyer and Seller each agrees to permit the
Governmental Bodies with authority over Buyer or Seller, as the case may be, to access the
Books and Records of which Buyer or Seller has custody, after the Closing Date, and to use,
inspect, make extracts from or request copies of any such records in the manner and to the
extent requested, and to duplicate, in the discretion of such Governmental Bodies, any
record in the form of microfilm or microfiche pertaining to such Books and Records.




     (d) From and after the Effective Time, Buyer shall not destroy any of the Transferred
Records unless Buyer complies with the retention requirements of applicable law or it
receives the prior consent of Seller. Seller shall not destroy, or allow the destruction of
any of the retained records, unless Seller complies with the retention requirements of
applicable law or it receives the prior consent of Buyer. If requested by Seller, the
Transferred Records shall be delivered to Seller in lieu of being destroyed.



     7.7 Tax Reporting Obligations.




     (a) Seller will report to applicable taxing authorities and holders of Deposits, with
respect to the period from January 1 of the year in which the Closing occurs through the
Closing Date, all interest (including dividends and other distributions with respect to
money market accounts) credited to, withheld from and any early withdrawal penalties imposed
upon the Deposits. Buyer will report to the applicable taxing authorities and



62









 






holders of Deposits, with respect to all periods from the day after the Closing Date,
all such interest credited to, withheld from and any early withdrawal penalties imposed upon
the Deposits.




     (b) Any amounts required by any governmental agencies to be withheld from any of the
Deposits through the Closing Date will be withheld by Seller in accordance with applicable
law or appropriate notice from any governmental agency and will be remitted by Seller to the
appropriate agency on or prior to the applicable due date. Any such withholding required to
be made subsequent to the Closing Date will be withheld by Buyer in accordance with
applicable law or appropriate notice from any governmental agency and will be remitted by
Buyer to the appropriate agency on or prior to the applicable due date.




     (c) Within five (5) calendar days after the date hereof, Seller shall provide Buyer in
an electronic format a file setting forth (i) the names, addresses, account numbers and
federal tax identification numbers of each holder of Deposits for which Seller has received
a certification of such holder’s tax identification number, and (ii) the names, addresses
and account numbers of each holder of Deposits which is subject to back-up withholding.




     (d) Within five (5) calendar days after the Closing Date, Seller shall deliver to Buyer
all original forms, records and documents in its possession (or copies thereof if originals
are not in Seller’s possession) regarding tax identification number certification and
back-up holding requests, including, without limitation, all Forms W-8 and Forms W-9 related
to the Deposits, provided that Seller shall be entitled to retain a copy of all such forms,
records and documents for its files.




     (e) Seller shall be responsible for delivering to payees all IRS notices with respect
to information reporting and tax identification numbers required to be delivered through the
Closing Date with respect to the Deposits, and Buyer shall be responsible for delivering to
payees all such notices required to be delivered following the Closing Date with respect to
the Deposits.




     (f) Seller will make all required reports to applicable taxing authorities and to
obligors on Loans purchased on the Closing Date, with respect to the period from January 1
of the year in which the Closing occurs through the Closing Date, concerning all interest
and points received by Seller. Buyer will make all required reports to applicable taxing
authorities and to obligors on Loans purchased on the Closing Date, with respect to all
periods from the day after the Closing Date, concerning all such interest and points
received.



     7.8 Credit Life Insurance Refunds. Seller, or its successor, agrees to refund to
Buyer the portion of premiums on the accident and health insurance and/or credit life insurance
(the “Insurance”) that may be required to be refunded by banking and insurance regulations
on the Loans transferred by Seller to Buyer upon presentation on a monthly basis by Buyer of such
premium refunds. This Section 7.8 shall
survive until all Loans upon which the Insurance has been purchased shall mature. Buyer shall
have all legal rights under Missouri law or Illinois law,



63









 




as applicable, including the right to
recoup legal fees incurred, in collecting such funds from Seller or its successor.




     7.9 Non-Solicitation of Employees. From the date hereof until the Closing Date,
Seller and its Affiliates shall not relocate, or agree to relocate, any Potential Employee to
another branch or office of Seller or any Affiliate of Seller unless Buyer has notified Seller that
Buyer does not intend to make an offer of employment to such Potential Employee. From and after
the Closing, and for a period of four (4) years following the Closing Date, Seller and its
Affiliates and their respective successors and assigns shall not directly or indirectly hire any
Retained Employee, without the prior consent of Buyer, unless such person’s employment was
terminated by Buyer.



     7.10 Non-Solicitation of Business. In consideration of the purchase of the Acquired
Assets and the assumption of Assumed Liabilities by Buyer, neither Seller nor its Affiliates
(including the directors, officers, employees or principal shareholders), successors or assigns
will, for a period of four (4) years after the Closing Date, solicit or service, on behalf of
itself or others, deposits, loans, brokerage, credit or debit or prepaid card, or other business
from customers whose Deposits are assumed or whose Loans, safe deposit or any other business are
acquired by Buyer hereunder; provided, however, that nothing contained in this
Section 7.10 shall be deemed to prohibit general solicitations in major metropolitan (i)
newspapers, (ii) television or (iii) radio and not specifically directed or targeted to customers
of the Branches, but no direct mail or local market solicitation or advertising shall be
permissible. Notwithstanding the provisions of this Section 7.10 and subject to the
provisions of Section 7.11(d) hereof, Seller or any Affiliate thereof may (X) continue to
engage in all customary communications, including distribution of loan solicitations and loan
promotional materials, with and service any former customers of the Branches with whom Seller or
any Affiliate thereof maintains a banking, lending, brokerage or other financial relationship on
the date hereof not otherwise prohibited by the terms of this Agreement after the Closing Date, (Y)
maintain an office and employees for the purposes of servicing any non-performing loan originated
prior to the date of this Agreement or any other Commitment, overdraft or other extension of credit
that is not a Loan and is originated prior to Closing (in each case which may include renewing,
extending the maturity of, or restructuring such extensions of credit), and servicing deposits of
the Branches that are excluded as Deposits, and (Z) maintain an office and employees with respect
to any Branch that Buyer has excluded from the Acquisition pursuant to Section 6.12,
6.13, 6.15 or 6.21 hereof and is not able to acquire the Deposits of which
on the Closing Date due to regulatory requirements.



     7.11 Covenant Not to Compete.




     (a) From and after the Closing, and for a period of four (4) years following the
Closing Date, Seller and its Affiliates, successors or assigns shall not, and shall not
enter into any agreement to, (i) acquire, lease, purchase, own, operate or use any building,
office or other facility or premises located within the 100 mile radius of the City of
Chicago (the “Geographic Region”) for the purpose of making loans, accepting
deposits,
cashing checks, issuing credit cards, debit cards, or prepaid cards, or engaging in all
of the businesses in which the Branches are engaged at the Closing Date, which shall be
deemed to include, without limitation, provision of brokerage, investment and insurance



64









 






services, or (ii) use, authorize, license or permit any other Person to use the name “First
Bank” (or any variation thereof) for any purpose within the Geographic Region.
Notwithstanding the foregoing and subject to the provisions of Section 7.11(d)
hereof, the Parties agree that (i) Seller may maintain an office and employees for the
purposes of servicing any loan, Commitment, overdraft or other extension of credit that is
not a Loan and is originated prior to the Closing (which may include renewing, extending the
maturity of, or restructuring such extension of credit), and the Loans that are repurchased
from Buyer in accordance with Section 2.6 hereof, and servicing deposits of the
Branches that are excluded as Deposits, and (ii) maintain an office and employees with
respect to any Branch that Buyer has excluded from the Acquisition pursuant to Section
6.12, 6.13, 6.15 or 6.21 hereof and is not able to acquire the
Deposits of which on the Closing Date due to regulatory requirements; provided,
however, that Buyer agrees that (A) the prohibitions contained in this Section
7.11 shall not be applicable to a Person that is not an Affiliate of the Seller on the
date hereof and that becomes the successor in interest to Seller after the Closing Date if
such Person’s banking activities at least one (1) year prior to becoming such successor
would, upon becoming such successor, result in such successor being in breach of this
Section 7.11(a), and (B) the prohibitions contained in this Section 7.11
shall not apply to the asset-based lending activities (and only the asset-based lending
activities) of First Bank Business Capital, Inc. (it being understood that nothing contained
herein shall limit any covenant not to compete or other restrictive covenant of First Bank
Business Capital, Inc. under the ABL Purchase Agreement). Nothing contained in this
Section 7.11 shall be construed to prevent Buyer from seeking and recovering from
Seller damages sustained by it as a result of any breach or violation by Seller of the
covenants or agreements contained herein.




     (b) It is recognized and hereby acknowledged by the Parties hereto that a breach or
violation by Seller of any or all of the covenants and agreements contained in this
Section 7.11 may cause irreparable harm and damage to Buyer in a monetary amount
which may be virtually impossible to ascertain. As a result, Seller recognizes and hereby
acknowledges that Buyer shall be entitled to an injunction from any court of competent
jurisdiction enjoining and restraining any breach or violation by Seller or any of its
Affiliates, partners or agents, either directly or indirectly, and that such right to
injunction shall be cumulative and in addition to whatever other rights or remedies Buyer
may possess hereunder, at law or in equity.




     (c) The restrictions against competition set forth above are considered by the Parties
to be both reasonable and essential to protect the business and goodwill of the Branches
being acquired by Buyer pursuant to this Agreement. If any such restriction is found by any
court of competent jurisdiction to be unenforceable because it extends for too long a period
of time or over too broad a range of activities or over too large a geographic area, such
restriction shall be interpreted and reformed to extend only over the maximum period of
time, range of activities or geographic area as to which it may be enforceable.




     (d) The rights of Seller under the last sentence of Section 7.10 and the
penultimate sentence of Section 7.11(a) hereof shall be subject to the following
limitations: Not later than sixty (60) days following the Closing Date, Seller shall apply



65









 






to, and use its Commercially Reasonable Efforts to obtain from, each Governmental Body as
shall be necessary to authorize Seller to close the Rejected Branches and any other banking
branch maintained by Seller within the Geographic Region for the purpose of (i) engaging in
the activities described in clauses (X), (Y) and (Z) of the last sentence of Section
7.10 or (ii) the activities described in the penultimate sentence of Section
7.11(a). Not later than the later to occur of (A) the date that is one (1) year
following the Closing Date and (B) the granting of authorization from the applicable
Government Body to close the applicable Rejected Branch or other banking branch within the
Geographic Region, Seller shall close such Rejected Branch or other branch and cease
conducting such activities. Nothing contained in this clause (d) shall restrict the Seller
seeking another buyer for a Rejected Branch or other banking branch within the Geographic
Region during the one-year period subsequent to the Closing Date or from maintaining one or
more offices within the Geographic Region not open to the general public for banking
business in order to administer and wind down the Excluded Assets and the Excluded
Liabilities or any other purpose not expressly prohibited by this Agreement.



     7.12 Legal Inquiries. The Parties hereby agree to the following with respect to
subpoenas and certain process matters: Following the Closing, Seller will handle and process all
civil and criminal subpoenas, IRS summons, court-ordered or government or agency or regulatory
demands for documents and all similar legal notices or other information, and all notices, claims,
demands of any kind from customers or third parties (collectively, “Subpoenas”) served on
Seller prior to the Closing Date that relate to the Acquired Assets or the Deposits. Following the
Closing Date, each party shall use good faith efforts to promptly forward any such Subpoenas that
relate to the Acquired Assets or the Deposits to the other party, as applicable, to the following
addresses: FirstMerit Bank, N.A., III Cascade Plaza, CAS 81, Akron, Ohio 44308; and shall also send
a facsimile of same to (330) 384-7133, Attention: Legal Department, and First Bank, Deposit
Services, 600 James S. McDonnell Blvd., Hazelwood, Missouri 63042, Mail Stop M1-199-042, Attention
Kurt Eisleben.



     7.13 Employment.




     (a) Retained Employees shall be employed by Buyer after the Closing Date upon terms and
conditions of employment offered by Buyer as provided by Section 6.7(b) hereof
(except as otherwise provided in Section 7.13(b) below). However, for purposes of
Buyer’s defined contribution Employee Pension Benefit Plan (“Buyer’s 401(k) plan”)
and any Employee Welfare Benefit Plans (including paid time off (PTO) policies), time of
service with the Seller prior to the Closing Date will be credited to the Retained Employees
(based on, in the case of a Retained Employee, such person’s date of hire by Seller) for
purposes of determining eligibility and calculating vesting (if applicable) to the greatest
extent permitted under such plans and applicable law, provided that, for elective benefits,
the Retained Employee elects to enroll in the plan on or before thirty-one (31) days from
the date such Retained Employee first becomes eligible to participate in the plan. Each
Retained Employee shall be permitted, to the extent
permitted by law and the provisions of Buyer’s 401(k) plan, to participate in Buyer’s
401(k) plan and to roll over any eligible rollover contributions into such plan.
Furthermore, to the extent permitted by any applicable insurer, Buyer will waive any
pre-existing condition exclusions, evidence of insurability provisions, waiting period



66









 






requirements or any similar provision under the Buyer’s health benefit plans, provided that
the Retained Employee elects to enroll in the plan on or before thirty-one (31) days from
the date such Retained Employee first becomes eligible to participate in the plan.




     (b) Notwithstanding anything to the contrary in this Agreement, for the period
commencing on the Closing Date and ending at the end of the last day of the calendar month
in which the Closing Date occurs, Seller shall, at its expense, continue to provide medical,
dental and vision benefits under Seller’s Employee Welfare Benefit Plans to the Retained
Employees at the same level provided to such Retained Employees prior to the Closing.




     (c) Buyer shall have no liability to any current or former employees of Seller and/or
its Affiliates for any accrued wages, sick leave, vacation time, pension obligations or any
other employee benefits accrued as employees of Seller and/or its Affiliates. Buyer will
have no liability and will not assume obligations under any Employee Pension Benefit Plan or
Employee Welfare Benefit Plan sponsored, maintained or contributed to by Seller or its
Affiliates or any other obligations (including, without limitation, health continuation
coverage, severance obligations, fringe benefit or deferred compensation arrangements, bonus
plans, incentive programs, or retiree medical coverage) to the employees or former employees
at any of the Branches. Seller and/or its Affiliates will be solely responsible for
fulfilling, and resolving any disputes concerning, its liabilities or obligations
(including, without limitation, health continuation coverage, bonus, incentive, severance
obligations, fringe benefit or deferred compensation arrangements, bonus plans, incentive
programs, or retiree medical coverage) to the employees at the Branches under any such
employee benefit plan or with regard to any similar plans, programs, or arrangements.




     (d) Nothing contained herein shall (i) confer upon any former, current or future
employee of Seller or its Affiliates or Buyer or its Affiliates or any legal representative
or beneficiary thereof any rights or remedies, including, without limitation, any right to
employment or continued employment of any nature, for any specified period, or (ii) cause
the employment status of any former, present or future employee of Buyer or its Affiliates
to be other than terminable at will.



     7.14 Removal of Seller’s Name from Signs. As soon as reasonably practicable following
the Closing, but in no event later than thirty (30) days following the Closing Date, Seller shall
either remove and discard all signs at the Branches incorporating Seller’s name (or, at the request
of Seller in the case of Seller’s logo boxes and channel letter sets, make available for return to
Seller such logo boxes and channel letter sets) or cause Seller’s name contained in such signs
(other than such logo boxes and channel letter sets, which are to be made available for return to
Seller) to be replaced with Buyer’s name.



ARTICLE 8

CONDITIONS TO OBLIGATION TO CLOSE




     8.1 Conditions to Obligation of Buyer. Buyer’s obligation to purchase the Acquired
Assets and assume the Assumed Liabilities as provided in Article 2 and to take the other
actions



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required to be taken by Buyer at the Closing is subject to the satisfaction, at or prior to
the Closing, of each of the following conditions (any of which may be waived by Buyer, in whole or
in part):





     (a) Buyer and Seller shall have procured all of the Consents (including all Regulatory
Approvals) required to consummate the Acquisition (other than any approvals of the Board of
Directors, shareholders or lenders of Buyer or Seller as necessary to authorize the Buyer or
Seller, as the case may be, to enter into this Agreement and consummate the transactions
contemplated hereby, all of which having been obtained prior to the date hereof) and all
applicable waiting periods (and any extensions thereof) shall have expired or otherwise been
terminated, unless such regulatory approval imposes any condition or requirement which in
the reasonable judgment of Buyer would materially adversely impact the economic or business
benefits of the transactions contemplated by this Agreement or otherwise would in the
reasonable judgment of the Buyer be so burdensome as to render inadvisable the consummation
of the transactions contemplated by this Agreement.




     (b) The representations and warranties of Seller set forth in Article 3 and
Article 4 above shall be true and correct in all material respects (or in all
respects, as to any representation or warranty qualified by a standard of materiality) on
the date of this Agreement and at and as of the Closing Date (except for representations and
warranties made as of a specific date, which shall be true and correct in all material
respects (or in all respects, if qualified by a standard of materiality) as of such specific
date and except for such breaches of representations and warranties as of the date of this
Agreement that have been cured on or prior to the earlier to occur of (i) the
30th day after written notice to the effect of any breach, and (ii) the fifth
calendar day prior to the Closing Date).




     (c) Seller shall have performed and complied with all of the covenants and agreements
required by the terms hereof to be performed or complied with by Seller on or prior to the
Closing Date.




     (d) Buyer shall have received all of the documents described in Section 9.1.




     (e) Subject to the satisfaction of Buyer’s obligations set forth in Section
9.2(c), Seller shall have caused Chicago Title Insurance Company to have irrevocably
committed to issue to Buyer title policies in favor of Buyer for each Acquired Owned Real
Property in the amount of the Book Value of such Acquired Owned Real Property in accordance
with the procedures set forth in Section 6.13, together with endorsements for same
as survey zoning (insuring the use of the property as a commercial banking branch and the
current use of the property, if different), comprehensive, contiguity (if
applicable), location, access, separate tax lot, subdivision (if applicable), and
arbitration deletion, to the extent available in the State of Illinois.




     (f) No court or other Governmental Body of competent jurisdiction shall have enacted,
issued, promulgated, enforced or entered any statute, rule, regulation, judgment, decree,
injunction or other order (whether temporary, preliminary or permanent) which is



68









 






in effect
and prohibits or makes illegal the consummation of the transaction contemplated hereby.




     (g) Buyer shall have received Landlord Consents with respect to the Leases (except
Leases associated with a Rejected Branch as contemplated by Section 6.12 hereof),
which Landlord Consents must be in form and substance reasonably satisfactory to Buyer.




     (h) There shall not have occurred a Seller Material Adverse Effect unless such Seller
Material Adverse Effect has been cured on or prior to the earlier to occur of (i) the
30th day after written notice to the effect of any breach and (ii) the fifth
calendar day prior to the Closing Date.




     (i) The Book Value of the Loans included in the Acquired Assets as of the Closing Date
shall be not less than $315,000,000 (or $335,000,000 if Buyer shall not have purchased from
First Bank Business Capital, Inc. pursuant to the ABL Purchase Agreement at least
$100,000,000 at “Par Value” (as defined in the ABL Purchase Agreement) of asset-based loans
as determined on the closing date thereunder).




     (j) The Book Value of all Deposits included in the Assumed Liabilities as of the
Closing Date shall be not less than $1.0 billion; provided that for purposes of the
computation contemplated by this clause (j) 20% of the Deposits of the Rejected Branches
shall be excluded.




     (k) Seller will be a “well capitalized” institution pursuant to Federal banking
regulations, as determined by Seller in good faith and in consultation with Buyer on a pro
forma basis after giving effect to the Acquisition.




     (l) Buyer shall not have excluded from this Acquisition pursuant to the provisions of
Section 6.12 (which relates to Landlord Consents), Section 6.13 (which
relates to title insurance and land surveys) and Section 6.15 (which relates to
environmental liabilities) more than one (1) Branch.




     (m) The employment agreements between Buyer and the persons listed on Schedule
8.1(m), which employment agreements have been executed on or prior to the date hereof
and made effective as of the Closing Date, shall remain in full force and effect on and as
of the Closing Date and Buyer shall be satisfied that such person intends to honor and not
rescind such employment agreement.




     (n) At least eighty percent (80%) of the total number of commercial lenders and
business bankers who are Potential Employees to whom Buyer has made an offer of employment
shall have accepted Buyer’s offer of employment.




     (o) Seller shall have terminated or amended to Buyer’s satisfaction all agreements and
arrangements pursuant to which any other Person is required or permitted to use the name
“First Bank” or any variation thereof in connection with issuing credit cards, debit cards,
or prepaid cards within the Geographic Region.



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     (p) FB Parent shall have delivered to Buyer (i) a guaranty, pursuant to which it shall
have guaranteed the obligations of Seller under this Agreement, and (ii) a pledge agreement,
pursuant to which it shall have pledged and delivered to Buyer $2,000,000 in cash for a
period of two (2) years as collateral security for FB Parent’s obligations under such
guaranty, which guaranty and pledge agreement shall be in form and substance reasonably
acceptable to Buyer.




     (q) Buyer shall have received the funds, if any, and documents described in Section
9.1 below.



     8.2 Conditions to Obligation of Seller. The obligation of Seller to consummate the
transactions to be performed by it in connection with the Closing is subject to satisfaction of the
following conditions:




     (a) Buyer and Seller shall have procured all of the Regulatory Approvals required to
consummate the Acquisition and all applicable waiting periods (and any extensions thereof)
shall have expired or otherwise been terminated.




     (b) The representations and warranties of Buyer set forth in Article 5 above
shall be true and correct in all material respects (or in all respects, as to any
representation or warranty qualified by a standard of materiality) on the date of this
Agreement and at and as of the Closing Date(except for such breaches of representations and
warranties as of the date of this Agreement that have been cured on or prior to the earlier
to occur of (i) the 30th day after written notice to the effect of any breach,
and (ii) the fifth calendar day prior to the Closing Date).




     (c) Buyer shall have performed and complied with all of the covenants and agreements
required by the terms hereof to be performed or complied with by Buyer on or prior to the
Closing Date.




     (d) Seller shall have received the funds, if any, and documents described in
Section 9.2 below.



ARTICLE 9

ITEMS TO BE DELIVERED AT OR PRIOR TO CLOSING




     9.1 By Seller. Seller shall execute and/or deliver, as applicable, to Buyer (or shall
have caused to be executed and/or delivered to Buyer) prior to or at the Closing:




     (a) A certificate duly executed by an authorized officer of Seller stating that as of
the Closing Date, each of the conditions specified in Section 8.1(a) through
Section 8.1(c) are satisfied in all respects;




     (b) A Bill of Sale with respect to the Acquired Assets in a form mutually acceptable to
Buyer and Seller;




     (c) Special warranty deeds conveying the Acquired Owned Real Property, together with
such instruments and documentation that may reasonably be requested to



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transfer the Acquired
Owned Real Property in a form mutually acceptable to Buyer and Seller;




     (d) Subject to Buyer’s compliance with the provisions of Section 9.2(c) hereof,
title policies issued by Chicago Title Insurance Company in the Book Value of the Acquired
Owned Real Property in accordance with the procedures set forth in Section 6.13;




     (e) Assignment of the Leases in respect of the Leased Real Property in a form mutually
acceptable to Buyer and Seller;




     (f) Such other instruments, documents or certificates as may be reasonably requested by
Buyer in order to effect or carry out the intent of this Agreement, including a certificate
of the Secretary of Seller certifying as to Seller’s corporate authorizations,
organizational documents, good standing and the incumbency of the officers of Seller
executing the Seller Documents;




     (g) Contents, keys, documents and other records maintained at the Acquired Branches
directly pertaining to the safe deposit boxes maintained at the Acquired Branches (whether
rented or unrented) as the same may exist as of the close of business on the Closing Date;




     (h) All funds required to be paid to Buyer pursuant to the terms of this Agreement in
immediately available funds;




     (i) A certificate of non-foreign status pursuant to Treasury Regulations Section
1.1445-2(b)(2) from Seller;




     (j) For Loans that are a portion of the Acquired Assets:




     (i) The Limited Power of Attorney, attached hereto as Exhibit C; and




     (ii) Endorsement of, or allonge for, the applicable notes; and




     (iii) Execution of any additional assignment documents provided by Buyer
pursuant to Section 6.8(b); and




     (k) Such other Acquired Assets as shall be capable of physical delivery.



     9.2 By Buyer. Buyer shall deliver to Seller at or prior to the Closing:




     (a) Any funds required to be paid to Seller pursuant to the terms of this Agreement in
immediately available funds;




     (b) A certificate duly executed by an authorized officer of Buyer stating that, as of
the Closing Date, each of the conditions specified in Section 8.2(a) through
Section 8.2(c) is satisfied in all respects;



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     (c) Such other documents or instruments as may be reasonably required by Chicago Title
Insurance Company as customarily delivered by buyers (as opposed to sellers or other third
parties) in connection with its commitments to issue the title policies described
Section 8.1(e) including, without limitation any documents or information required
pursuant to any requirements set forth in the title commitments; and




     (d) Such other instruments, documents or certificates as may be reasonably requested by
Seller in order to effect or carry out the intent of this Agreement, including a certificate
of the Secretary of Buyer certifying as to Buyer’s corporate authorizations, organizational
documents, good standing and the incumbency of the officers of Buyer executing the Buyer
Documents.



ARTICLE 10

TERMINATION




     10.1 Termination of Agreement.




     (a) The Parties may terminate this Agreement by mutual written consent at any time
prior to the Closing Date.




     (b) Buyer may terminate this Agreement by giving written notice to Seller any time
prior to the Closing Date (i) in the event Seller has breached any representation, warranty,
or covenant contained in this Agreement in any material respect, Buyer has notified Seller
of the breach, and the breach has continued without cure for a period of thirty (30) days
after the notice of breach, (ii) if the Closing shall not have occurred on or before
February 28, 2010, by reason of the failure of any conditions precedent under Section
8.1 (unless the failure results primarily from Buyer breaching any representation,
warranty, or covenant contained in this Agreement); or (iii) there shall have occurred a
Seller Material Adverse Effect and such Seller Material Adverse Effect has not been cured on
or before the earlier to occur of (Y) the 30th calendar day following receipt by
Seller of written notice from Buyer of a Seller Material Adverse Effect, and (Z) the fifth
calendar day prior to the Closing Date.




     (c) Seller may terminate this Agreement by giving written notice to Buyer at any time
prior to the Closing Date (i) in the event Buyer has breached any representation, warranty,
or covenant contained in this Agreement in any material respect, Seller has notified Buyer
of the breach, and the breach has continued without cure for a period of
thirty (30) days after the notice of breach; (ii) if the Closing shall not have
occurred on or before February 28, 2010, by reason of the failure of any condition precedent
under Section 8.2 hereof (unless the failure results primarily from Seller breaching
any representation, warranty, or covenant contained in this Agreement), or (iii) there shall
have occurred a Buyer Material Adverse Effect and such Buyer Material Adverse Effect has not
been cured on or before the earlier to occur of (Y) the 30th calendar day
following receipt by Seller of written notice thereof from Buyer of a Buyer Material Adverse
Effect, and (Z) the fifth calendar day prior to the Closing Date.




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     10.2 Effect of Termination. If any Party terminates this Agreement pursuant to
Section 10.1 above, all rights and obligations of the Parties hereunder shall terminate
without any Liability of any Party to any other Party (except for any Liability of any Party then
in breach); provided, however, that the provisions contained in Section 6.3
(confidentiality) and Section 6.7(f) (non-solicitation) shall survive termination.



ARTICLE 11

REMEDIES FOR BREACH OF THIS AGREEMENT




     11.1 Survival. The Parties agree for all purposes of this Agreement that the
representations and warranties made by a Party are strictly relied upon by the Party to whom they
are made and may be relied upon and enforced by the Party to whom they are made, and shall survive
(in accordance with the provisions hereof), regardless of any investigation made or to be made by
or on behalf of the Party to whom they are made or whether such Party or its representatives or
advisors knew or should have known that such representations and warranties were inaccurate. All
representations and warranties of the Parties contained in this Agreement shall survive the Closing
and continue in full force and effect thereafter for a period of two (2) years following the
Closing Date, except for those representations and warranties (a) of Seller (i) contained in
Section 4.9 herein, which shall survive the Closing Date for a period of eight (8) years,
(ii) contained in Section 4.4 herein, which shall survive the Closing Date for a period of
sixty (60) days following the expiration of the statute of limitations (including any extension
thereof) for the Taxes giving rise to such claim, and (iii) contained in Sections 3.1,
3.2, 3.3, 3.4, 4.1 and 4.11, which shall survive the
Closing Date without end or termination, and (b) of Buyer contained in Sections 5.1,
5.2, 5.3 and 5.4, which shall survive the Closing Date without end or
termination, and thereafter neither Party (or other Indemnitee) may claim any Loss in relation to a
breach of any representation and warranty made by the other Party hereunder unless a claim for
indemnification arising out of such breach shall have been properly made on or prior to such expiry
date, in which case the obligation of the Indemnifying Party hereunder to indemnify the Indemnitee
hereunder for such claim shall survive until such time as such claim shall have been resolved and
fully satisfied. After the end of such expiry period, Seller’s obligation to indemnify the Buyer
Indemnitees, and Buyer’s obligation to indemnify the Seller Indemnitees, with respect to such
representations and warranties shall expire except with respect to a matter set forth in a claim
notice that shall have been properly given on or prior to such expiry date. It is further agreed
by the Parties that each Buyer Indemnitee’s rights to indemnification set forth in clauses (b)
through (f) of Section 11.2 hereof, and each Seller Indemnitees rights to indemnification
set forth in clauses (b) and (c) of Section 11.3 hereof, shall remain in full force and
effect indefinitely; provided, however, that the obligation of Seller to indemnify
the Buyer Indemnities pursuant to Section 11.2(d) hereof on account of an Excluded
Liability provided under Section 2.1(d)(ii) hereof shall survive the Closing and remain in
full force and effect for a period of eight (8) years following the Closing. The Parties agree
that, notwithstanding anything to the contrary contained herein, the rights and remedies of an
Indemnitee on account of the breach of or noncompliance with a representation, warranty, covenant
or agreement made herein in favor of such Indemnitee shall not be limited due to the fact that the
statement, fact, omission, conduct or occurrence upon which any claim of such breach of or
noncompliance with such representation, warranty, covenant or agreement is based shall be the
subject of any other representation, warranty, covenant or agreement contained herein that is not
breached or inaccurate.



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     11.2 Indemnification by Seller. Subject to the provisions of this Article 11,
Seller shall indemnify, defend and hold harmless Buyer, its Affiliates and the respective officers,
directors, employees, agents and representatives of Buyer and its Affiliates (each of whom may be
an Indemnitee pursuant to this Article 11) (collectively, the “Buyer Indemnitees”)
from and against, and pay and reimburse each such Buyer Indemnitee for, any and all Losses, whether
or not any such Losses arise out of any Third Party Claim, directly or indirectly arising out of,
from or in connection with:




     (a) any breach of any representation or warranty made by Seller under this Agreement
(including in the case of any Third Party Claim any Losses suffered by such Buyer Indemnitee
in the event that any third party unrelated to Buyer alleges facts that, if true, would
constitute or result in a breach by Seller of any such representation or warranty);




     (b) any default or breach of any covenant, obligation or agreement on the part of
Seller under this Agreement (including in the case of any Third Party Claim any Losses
suffered by such Buyer Indemnitee in the event that any third party unrelated to Buyer
alleges facts that, if true, would constitute or result in a breach by Seller of any such
covenant, obligation or agreement);




     (c) any Excluded Asset;




     (d) any Excluded Liability;




     (e) any check or other instrument drawn on or deposited into a Branch Deposit account
(i) on or prior to the Closing Date upon which a forgery (signature or endorsement) or
alteration claim is asserted against Buyer or as to which a proper endorsement is lacking,
or (ii) prior to or after the Closing Date that involves a check kiting scheme that was
initiated on or prior to the Closing Date;




     (f) any chargeback occurring after the Closing Date on a Deposit account to the extent
that such chargeback exceeds the funds in the account on the date of such chargeback but
solely to the extent that such chargeback resulted from a violation of Seller’s expedited
funds availability policy in effect on the date such funds were deemed collected on the
account (provided that Buyer shall reimburse Seller for any sums so indemnified to the
extent that Seller recoups any funds so charged back from subsequent deposits into the
Deposit account so transferred); or




     (g) the ownership or operation of the Branches or their business and properties
(including the Acquired Assets and the Deposits) on or prior to the Closing Date, but
excluding all Assumed Liabilities.



     11.3 Indemnification by Buyer. Subject to the provisions of this Article 11,
Buyer shall indemnify, defend and hold harmless Seller, its Affiliates and the respective officers,
directors, employees, agents and representatives of Seller and its Affiliates (each of whom may be
an Indemnitee pursuant to this Article 11) (collectively, the “Seller Indemnitees”)
from and against, and pay and reimburse each such Seller Indemnitee for, any and all Losses,
whether or



74









 







not any such Losses arise out of any Third Party Claim, directly or indirectly arising out of,
from or in connection with:




     (a) any breach of any representation or warranty made by Buyer under this Agreement
(including in the case of any Third Party Claim any Losses suffered by such Seller
Indemnitee in the event that any third party unrelated to Seller alleges facts that, if
true, would constitute or result in a breach by Buyer of any such representation or
warranty);




     (b) any default or breach of any covenant, obligation or agreement on the part of Buyer
under this Agreement (including in the case of any Third Party Claim any Losses suffered by
such Seller Indemnitee in the event that any third party unrelated to Seller alleges facts
that, if true, would constitute or result in a breach by Buyer of any such covenant,
obligation or agreement);




     (c) any physical damage to Seller’s Real Estate Interests caused by Buyer or its agent
in connection with any Phase II Environmental Assessments conducted by Buyer; or




     (d) any of the Acquired Assets or the Assumed Liabilities, except in each case to the
extent that indemnification for any thereof would be required by Seller pursuant to
Section 11.2.



     11.4 Limitations on Indemnity.




     (a) Seller will have no Liability to the Buyer Indemnitees for indemnification for any
breach of any of Seller’s representations and warranties pursuant to Section 11.2(a)
hereof (i) until the total of all Losses with respect to such matters exceeds $150,000 in
the aggregate (the “Loss Threshold”), at which point Seller will be obligated to
indemnify the Buyer Indemnitees from and against all such Losses relating back to the first
dollar, and (ii) to the extent such Losses shall exceed sixty percent (60%) of the dollar
amount of the premium computed on the Closing Date pursuant to Section 2.2(a)(i)
hereof (the “Cap”); provided, however, that the obligation of Seller
to indemnify the Buyer Indemnitees pursuant to Section 11.2(a) hereof on account of
the breach by Seller of any representation and warranty made by Seller pursuant to
Sections 3.1, 3.2, 3.3, 3.4, 4.1 (except as to that
portion of the representation contained in Sections 4.1 relating to the physical
condition of Acquired Tangible Personal Property), 4.10 (to the extent such Losses
relate to Excluded Loans), 4.11 and 4.12 hereof shall not be subject to the
Loss Threshold or the Cap. Buyer will have no Liability to the Seller Indemnitees for
indemnification for any breach of any of Buyer’s representations and warranties pursuant to
Section 11.3(a) hereof (i) until the total of all Losses with respect to such
matters exceeds the Loss Threshold, at which point Buyer will be obligated to indemnify the
Seller Indemnitees from and against all such Losses relating back to the first dollar, and
(ii) to the extent such Losses shall exceed the Cap; provided, however, that
the obligation of Buyer to indemnify the Seller Indemnitees pursuant to Section
11.3(a) hereof on account of the breach by Buyer of any representation and warranty made
by Buyer



75









 







pursuant to Sections 5.1, 5.2, or 5.3 hereof shall not be
subject to the Loss Threshold or the Cap.




     (b) If an Indemnitee desires to seek indemnification for any Loss for which it is
entitled to be indemnified pursuant to this Article 11, such Indemnitee shall
deliver written notice of its claim for indemnification to the Party against whom such
indemnification is being sought, provided, however, no Indemnitee shall be
entitled to be indemnified pursuant to Section 11.2(a) or 11.3(a) hereof in
respect of the breach of any representation or warranty made by a Party unless the
Indemnitee seeking indemnification shall have given such written notice to the indemnifying
Party prior to the expiration of the survival period for such representation or warranty as
set forth pursuant to Section 11.1 hereof. Such written notice shall set forth in
reasonable detail the basis (to the extent actually known by the Indemnitee) upon which such
claim for indemnity is made. In the event that any such claim is made within such
prescribed period, the indemnity relating to such claim shall survive until such claim is
resolved and fully satisfied.




     (c) The Buyer Indemnitees may seek payment and full and complete indemnity from Seller
in respect of any and all Losses or Third Party Claims under Sections 11.2(b),
11.2(c), 11.2(d), 11.2(e) and 11.2(f), and the Seller
Indemnitees may seek payment and full and complete indemnity from Buyer in respect of any
and all Losses or Third Party Claims under Sections 11.3(b), 11.3(c) and
11.3(d), and such indemnity shall not be subject to the Loss Threshold or the Cap.




     (d) Notwithstanding anything to the contrary contained in this Agreement, the Parties
agree that in the event that there shall arise or exist one or more Pre-Closing
Environmental Liabilities for which the Buyer Indemnitees are otherwise entitled to be
indemnified pursuant to Section 11.2(d) hereof, Buyer agrees to share with Seller,
and remain liable for and not seek from Seller indemnification for, fifty percent (50%) of
the first One Million Dollars ($1,000,000) of Losses arising out of all such Pre-Closing
Environmental Liabilities unless, with respect to any Pre-Closing Environmental Liability,
(i) such Pre-Closing Environmental Liability is attributable or related to a breach or
violation of the representations and warranties made by Seller pursuant to Article 4
hereof, (ii) such Pre-Closing Environmental Liability was disclosed on Schedule
4.9(a) or 4.9(g) or in the documents (or attachments to the documents) referred
to on Schedule 4.9(a) or 4.9(g), or (iii) such Pre-Closing Environmental
Liability was revealed during or in connection with the Phase I Environmental and Hazardous
Materials Assessment or Phase II Assessments conducted by Buyer pursuant to Section
6.15 hereof (other than any such Pre-Closing Environmental Liability so revealed on any
such assessment to the extent that the remediation costs in respect thereof constitute an
Assumed Liability pursuant to Section 2.1(c)(iv) hereof).



     11.5 Third Party Claims.




     (a) In no event shall any Indemnifying Party under this Agreement be liable with
respect to any Third Party Claim against any Indemnitee unless the following conditions are
satisfied:



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     (i) Except as provided in clause (ii) of this Section 11.5(a), no right
to indemnification under this Article 11 for a Third Party Claim shall be
available to an Indemnitee unless the Indemnitee shall have delivered to the
Indemnifying Party within the Notice Period a notice describing in reasonable detail
the facts (to the extent reasonably known by such Indemnitee) giving rise to such
Third Party Claim (a “Claim Notice”) and stating that the Indemnitee intends
to seek indemnification for such Third Party Claim from the Indemnitor pursuant to
this Article 11.




     (ii) If, in the case of a Third Party Claim, a Claim Notice is not given by the
Indemnitee within the Notice Period, the Indemnitee shall nevertheless be entitled
to be indemnified under this Article 11 except to the extent that the
Indemnifying Party can establish that the Indemnifying Party has been actually and
materially prejudiced by such time elapsed.




     (b) Upon receipt of a Claim Notice from an Indemnitee with respect to a Third Party
Claim and so long as the Indemnifying Party shall have acknowledged in writing its
unconditional obligation to indemnify the Indemnitee for all Losses arising out of such
Third Party Claim, the Indemnifying Party will have the right, at its expense, to assume and
thereafter conduct the defense of the Third Party Claim with counsel of its choice
reasonably satisfactory to the Indemnitee; provided, however, that the
Indemnifying Party will not consent to the entry of any judgment or enter into any
settlement with respect to the Third Party Claim without the prior written consent of the
Indemnitee (such consent not to be withheld or delayed unreasonably) unless the judgment or
proposed settlement (i) involves only the payment of money damages pursuant to which each
plaintiff or other claimant shall have agreed to unconditionally release the Indemnitee from
all liability in respect thereof, and (ii) does not impose an injunction or other equitable
relief upon the Indemnitee and does not relate to a claim under or related to any
Environmental Laws. The Indemnitee shall have the right to employ separate counsel at such
Indemnitee’s expense in connection with any such Third Party Claim and to participate in the
defense thereof; provided, however, that the reasonable fees and expenses of
counsel employed by the Indemnitee shall be at the expense of the Indemnifying Party if (i)
such counsel is retained pursuant to clause (c) of this Section 11.5, (ii) the named
parties to any such Third Party Claim include both the Indemnitee and the Indemnifying Party
and in the reasonable judgment of the Indemnitee, representation of the Indemnitee and the
Indemnifying Party by the same counsel would be inadvisable due to actual or potential
differing defenses or counterclaims or conflicts of interests between them, or (iii) the
employment of such counsel has been specifically authorized in writing by the Indemnifying
Party. Notwithstanding the foregoing, the Indemnifying Party shall not be entitled to
assume and control (but shall have the right to participate at its own expense in the
defense of), and the Indemnitee shall be entitled to have sole control over (with counsel of
its own choosing reasonably satisfactory to and at the expense of the Indemnifying Party),
the defense or settlement of any Third Party Claim (without prejudicing the right of the
Indemnitee to enforce its claim for indemnification against the Indemnifying Party under
this Agreement) to the extent such Third Party Claim seeks an order, injunction,
non-monetary or other equitable relief against the Indemnitee which, if



77









 







successful, could result in a material adverse effect upon the business, financial
condition, results of operations or assets of the Indemnitee.




     (c) If the Indemnifying Party does not assume the defense of such Third Party Claim
within twenty (20) days after receipt of the Claim Notice, the Indemnitee shall have the
right (including prior to the time the Indemnifying Party shall have assumed such defense),
with counsel of its own choosing reasonably satisfactory to and at the expense of the
Indemnifying Party, to assume and control the defense of, and settle or agree to pay in
full, such Third Party Claim; provided, however, that, so long as the
Indemnifying Party has acknowledged in writing its unconditional obligation to indemnify the
Indemnitee for such Third Party Claim, the Indemnitee shall not consent to the entry of a
judgment or enter into any settlement with respect to such Third Party without the prior
written consent of the Indemnifying Party (which consent shall not be unreasonably withheld
or delayed) unless such Third Party Claim seeks an order, injunction, non-monetary or other
equitable relief against the Indemnitee which, if successful, could result in a material
adverse effect upon the business, financial condition, results of operations or assets of
the Indemnitee; and, provided, further, that the assumption of the defense
of, and the consent to the entry of a judgment or entering into any settlement with respect
to, such Third Party Claim as provided in this clause (c) shall be without prejudice to the
right of the Indemnitee to enforce its claim for indemnification against the Indemnifying
Party under this Agreement.




     (d) Notwithstanding anything to the contrary contained in this Section 11.5, if
a Third Party Claim includes or would reasonably be expected to include both a claim for
Taxes that are not Excluded Liabilities pursuant to Section 2.1(d) (“Buyer
Taxes”) and a claim for Seller Taxes, and such claim for Seller Taxes is not separable
from such a claim for Buyer Taxes, Buyer (if the claim for Buyer Taxes exceeds or reasonably
would be expected to exceed in amount the claim for Seller Taxes) or otherwise Seller
(Seller or Buyer, as the case may be, the “Controlling Party”) shall be entitled to
control the defense of such Third Party Claim (such Third Party Claim, a “Tax
Claim”). In such case, the other party (Seller or Buyer, as the case may be, the
“Non-Controlling Party”) shall be entitled to participate fully (at the
Non-Controlling Party’s sole expense) in the conduct of such Tax Claim and the Controlling
Party shall not settle such Tax Claim without the consent of such Non-Controlling Party
(which consent shall not be unreasonably withheld, conditioned or delayed). The costs and
expenses of conducting the defense of such Tax Claim shall be reasonably apportioned based
on the relative amounts of the Tax Claim that are Seller Taxes and that are Buyer Taxes.




     (e) After the Closing Date, Buyer and Seller shall (i) each cooperate fully with the
other as to all Third Party Claims involving them, shall make available to the other, as
reasonably requested, all information, records and documents relating to all Third Party
Claims involving them and shall preserve all such information, records and documents until
the termination of any Third Party Claim involving them, and (ii) make available to the
other, as reasonably requested and at the reasonable cost and expense of the requesting
party, personnel, agents and other representatives who are responsible for preparing or
maintaining information, records or other documents, or who may have particular knowledge,
with respect to any Third Party Claim involving them.



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     11.6 Losses Computed Without Giving Effect to Materiality. The determination of
whether there shall have occurred a breach of a representation or warranty for which
indemnification is available under Section 11.2(a) or 11.3(a), as the case may be,
and the amount of any Losses or Third Party Claims for which an Indemnitee is entitled to seek
indemnification under such sections, as applicable, shall be made, determined and calculated
without regard to any material adverse effect or other materiality qualification set forth in the
relevant representation or warranty.



     11.7 Indemnity Payments Treated as Adjustments to Purchase Price. Buyer and Seller
agree to treat any indemnification payments made by Buyer or Seller pursuant to this Article
11 as an adjustment to the purchase price unless Buyer or Seller receives a written opinion,
reasonably satisfactory in form and substance to the other, of a law firm with appropriate
experience and expertise to the effect that it is not or is not likely to be permissible to treat
such payments in that manner on a federal, state or local income tax return.



     11.8 After-Tax Nature of Indemnity Payments. In the event that pursuant to
Section 11.7 the Parties are unable to treat any indemnification payments as an adjustment
to the purchase price, any such payment or indemnity required to be made pursuant to Section
11.2 or 11.3 hereof shall include any amount necessary to hold the Indemnitee harmless
on an after-tax basis from all Taxes required to be paid with respect to the receipt of such
payment or indemnity. In determining the amount necessary to be added to any payment or indemnity
in order to accomplish the foregoing, the parties hereto agree to treat all Taxes required to be
paid by any Indemnitee as if such Indemnitee were subject to tax at the highest marginal tax rates
(for both federal and state, as determined on a combined basis) applicable to such Indemnitee (or
such ultimate taxpayers).



     11.9 Third Party Beneficiaries. All Persons included within the terms “Buyer
Indemnitees” and “Seller Indemnitees” are intended third party beneficiaries of this Article
11 and shall have the right to enforce the benefits intended to be conferred upon each of them
under this Article 11 as though they were parties to this Agreement.



ARTICLE 12

MISCELLANEOUS




     12.1 Governing Law. This Agreement shall be governed by and construed in accordance
with the domestic laws of the State of Illinois without giving effect to any choice or conflict of
law provision or rule (whether of the State of Illinois or any other jurisdiction) that would cause
the application of the laws of any jurisdiction other than the State of Illinois.



     12.2 Consent to Jurisdiction; Waiver of Jury Trial.




     (a) Each of the parties hereto hereby irrevocably and unconditionally submits, for
itself and its property, to the jurisdiction of any State or Federal court sitting in the
State and City of Akron, Ohio and any appellate court from any thereof, in any action or
proceeding arising out of or relating to this Agreement or the transactions contemplated
hereby or for recognition or enforcement of any judgment relating thereto, and each of the
parties hereto hereby irrevocably and unconditionally agrees that all claims in respect



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of any such action or proceeding may be heard and determined in such Federal court.
Each of the parties hereto agrees that a final, non-appealable judgment in any such action
or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment in any other manner provided by law.




     (b) Each of the parties hereto hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection which it may now or
hereafter have to the laying of venue of any suit, action or proceeding arising out of or
relating to this Agreement or the transactions contemplated hereby in any State or Federal
court sitting in the State and City of Akron, Ohio. Each of the parties hereto hereby
irrevocably and unconditionally waives, to the fullest extent permitted by law, the defense
of any inconvenient forum to the maintenance of such action or proceeding in any such court.




     (c) Each of the parties hereto irrevocably consents to service of process in the manner
provided for notices in Section 12.6 hereof. Notwithstanding the foregoing, each of
the parties hereto shall have the right to serve process in any other manner permitted by
law.



     12.3 Waiver of Punitive Damages and Jury Trial. 




     (a) EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THE DEFINITION OF LOSSES, THE PARTIES TO
THIS AGREEMENT EXPRESSLY WAIVE AND FOREGO ANY RIGHT TO RECOVER PUNITIVE, EXEMPLARY,
CONSEQUENTIAL OR SIMILAR DAMAGES IN ANY LAWSUIT, LITIGATION, ARBITRATION OR PROCEEDING
ARISING OUT OF OR RESULTING FROM ANY CONTROVERSY OR CLAIM ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.




     (b) EACH PARTY HERETO ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE
UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE IT
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT 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 HEREBY.




     (c) EACH PARTY HERETO 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 WAIVERS SET FORTH IN CLAUSE (a)
OF THIS SECTION 12.3, (II) IT UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF
SUCH WAIVERS, (III) IT MAKES SUCH WAIVERS VOLUNTARILY, AND (IV) IT HAS BEEN INDUCED TO ENTER
INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE WAIVERS AND CERTIFICATIONS IN SUCH SECTION.



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     12.4 Successors and Assigns; No Third-Party Rights. No Party may assign any of its
rights or delegate any of its obligations under this Agreement without the prior written consent of
the other Parties. This Agreement will apply to, be binding in all respects upon, and inure to the
benefit of the successors and permitted assigns of the Parties. Except as otherwise provided in
Article 11 hereof, nothing expressed or referred to in this Agreement will be construed to
give any Person other than the Parties any legal or equitable right, remedy, or claim under or with
respect to this Agreement or any provision of this Agreement. This Agreement and all of its
provisions and conditions are for the sole and exclusive benefit of the Parties to this Agreement
and their successors and permitted assigns.



     12.5 Entire Agreement; Amendment. This Agreement and the other documents delivered
pursuant to this Agreement at the Closing and the Non-disclosure Agreement constitute the full and
entire understanding and agreement between the Parties with regard to the subjects hereof and
thereof, and supersede all prior agreements and merge all prior discussions, negotiations,
proposals and offers (written or oral) between them, and no Party shall be liable or bound to any
other Party in any manner by any warranties, representations or covenants except as specifically
set forth herein or therein. In the event of a conflict between the terms and provisions of the
Non-disclosure Agreement and the terms and provisions of this Agreement, the terms and provisions
of this Agreement shall be controlling.



     12.6 Notices. All notices, requests, demands, claims, and other communications
hereunder shall be in writing and shall be given by registered or certified mail, return receipt
requested, postage prepaid, by telecopier or by national overnight delivery service, and addressed
to the intended recipient as set forth below:



	 	 	 
	If to Seller:

	 	With a Copy to:
	 
	 	 
	Terrance M. McCarthy

	 	Walt G. Moeling, IV, Esq.
	President

	 	Bryan Cave, LLP
	First Bank

	 	1201 West Peachtree St, NW
	135 N. Meramec

	 	Fourteenth Floor
	Clayton, Missouri 63105

	 	Atlanta, Georgia 30309
	Facsimile: (314) 854-5690

	 	Facsimile: (404) 420-0038
	 
	 	 
	and

	 	and

	 
	 	 
	Peter D. Wimmer

	 	B.T. Atkinson, Esq.
	Senior Vice President and General Counsel

	 	Bryan Cave, LLP
	First Bank

	 	One Wachovia Center
	135 N. Meramec, Suite 410

	 	301 S. College Street, Suite 3700
	Clayton, Missouri 63105

	 	Charlotte, North Carolina 28202
	Facsimile: (314) 854-4617

	 	Facsimile: (704) 749-9354






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	If to Buyer:

	 	With a Copy to:
	 
	 	 
	FirstMerit Bank, N.A.

	 	Jeffrey M. Werthan, Esq.
	Paul G. Greig

	 	Katten Muchin Rosenman LLP
	Chairman, President and CEO

	 	2900 K Street, NW, Suite 200
	III Cascade Plaza, CAS 80

	 	Washington, DC 20007
	Akron, Ohio 44308

	 	Facsimile: (202) 339-8281
	Facsimile: (330) 384-7271

	 	 
	 
	 	 
	and

	 	and

	 
	 	 
	Judith A. Steiner, Esq.

	 	Steven C. Schnitzer, Esq.
	Executive V.P., Secretary & General Counsel

	 	Katten Muchin Rosenman LLP
	FirstMerit Bank, N.A.

	 	2900 K Street, NW, Suite 200
	III Cascade Plaza, CAS 80

	 	Washington, DC 20007
	Akron, Ohio 44308

	 	Facsimile: (202) 339-8293
	Facsimile: (330) 384-7271
	 	 





Any notice given in the manner aforesaid shall be deemed to have been served, and shall be
effective for all purposes hereof on the date of its receipt by the party to be notified. Any
Party may change the address to which notices, requests, demands, claims, and other communications
hereunder are to be delivered by giving the other Party notice in the manner herein set forth.




     12.7 Amendments and Waivers. Except as expressly provided in this Agreement, neither
this Agreement nor any term hereof may be amended, waived, discharged or terminated other than by a
written instrument signed by the Party against whom enforcement of any such amendment, waiver,
discharge or termination is sought. No waiver by any Party of any default, misrepresentation, or
breach of warranty or covenant hereunder, whether intentional or not, shall be deemed to extend to
any prior or subsequent default, misrepresentation, or breach of warranty or covenant hereunder or
affect in any way any rights arising by virtue of any prior or subsequent such occurrence.



     12.8 Counterparts. This Agreement may be executed in any number of counterparts, each
of which shall be enforceable against the parties actually executing such counterparts, and all of
which together shall constitute one instrument. A signature on a counterpart may be a facsimile or
an electronically transmitted signature, and such signature shall have the same force and effect as
an original signature.



     12.9 Severability. In the event that any provision of this Agreement becomes or is
declared by a court of competent jurisdiction to be illegal, unenforceable or void, this Agreement
shall continue in full force and effect without said provision.



     12.10 Titles and Subtitles. The titles and subtitles used in this Agreement are used
for convenience only and are not considered in construing or interpreting this Agreement.



     12.11 Construction. The Parties have participated jointly in the negotiation and
drafting of this Agreement. In the event an ambiguity or question of intent or interpretation
arises, this



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Agreement shall be construed as if drafted jointly by the Parties and no presumption or burden
of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any of the
provisions of this Agreement. All plural nouns and pronouns shall be deemed to include the
singular case thereof where the context requires, and vice versa. All pronouns shall be gender
neutral unless the context otherwise requires. Any reference to any federal, state, local, or
foreign statute or law shall be deemed also to refer to all rules and regulations promulgated
thereunder, unless the context otherwise requires. The word “including” shall mean including
without limitation. Whenever the word “indemnification”, “indemnify” or “indemnified” is used
herein with respect to any Indemnitee’s right to indemnification (or words of correlative meaning)
from an Indemnifying Party hereunder, including as provided in Article 11 hereof or any
other Article or Section hereof, then such Indemnitee’s right to “indemnification” or to be
“indemnified” (or words of correlative meaning) shall be deemed to include the right to be defended
or held harmless, and paid and reimbursed, with respect to such matter or claim or Loss or
Liability as to which the word “indemnification” or “indemnified” or “indemnify” shall apply,
unless otherwise expressly provided to the contrary.



     12.12 Expenses. Other than expressly provided herein, each Party will bear its
respective expenses incurred in connection with the preparation, execution, and performance of this
Agreement, filing any regulatory notices or applications, and the Acquisition, including all fees
and expenses of agents, representatives, counsel, and accountants. In the event of termination of
this Agreement, the obligation of each Party to pay its own expenses will be subject to any rights
of such Party arising from a breach of this Agreement by another Party.



     12.13 Waiver of Compliance with Bulk Sales Laws.
Buyer and Seller hereby waive compliance by them in connection with the transactions
contemplated by this Agreement with the provisions of Article 6 of the Uniform Commercial Code as
adopted in states where any of the Acquired Assets are located, and any other applicable bulk sales
laws with respect to or requiring notice to any of Seller’s creditors or taxing authorities and any
related withholding requirements, in effect as of the date of the Closing. Seller shall fully
indemnify, reimburse and hold harmless Buyer against all Liabilities, damages or expenses which
Buyer may suffer or incur due to Seller’s failure to so comply.



     12.14 Next Business Day. In the event that either Party is required by this Agreement
to perform any action or delivery on a Saturday, Sunday or any holiday observed by the Federal
Reserve, such Party may perform the action or delivery on the following Business Day.



[Signature Page Follows]




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     IN WITNESS WHEREOF, the Parties have executed this Agreement on the date first above written.



	 	 	 	 	 
	 	FIRSTMERIT BANK, N.A.

 	 
	 	By:  	/s/ Terrence E. Bichsel
 	 
	 	 	Name:  	Terrence E. Bichsel 	 
	 	 	Title:  	Executive Vice President and Chief Financial

Officer 	 
	 
	 	FIRST BANK

 	 
	 	By:  	/s/ Terrance M. McCarthy
 	 
	 	 	Name:  	Terrance M. McCarthy 	 
	 	 	Title:  	Chairman, President and Chief Executive Officer