|
| Page
|
| Article I - The Transaction
| 1
| 1.1 Merger of Grand Premier with and into MergerSub
| 1
| 1.2 The Closing
| 2
| 1.3 Effective Time of the Merger
| 2
| 1.4 Additional Actions
| 2
| 1.5 Surviving Corporation
| 2
| 1.6 Bank Consolidation
| 3
|
| Article II - Conversion and Exchange of Shares
| 3
| 2.1 Conversion of Shares
| 3
| 2.2 Upset Provision
| 5
| 2.3 Adjustments
| 7
| 2.4 Increase in Outstanding Shares of Grand Premier Common Stock
| 8
| 2.5 Cessation of Stockholder Status
| 9
| 2.6 Surrender of Old Certificates and Distribution of Stock
| 9
| 2.7 No Fractional Shares
| 11
| 2.8 Stock Options
| 11
| 2.9 Approval of Grand Premier
| 12
|
| Article III - Old Kent's Representations and Warranties
| 13
| 3.1 Authorization, No Conflicts, Etc.
| 13
| 3.2 Organization and Good Standing
| 14
| 3.3 Subsidiaries
| 14
| 3.4 Capital Stock
| 14
| 3.5 Old Kent Capital Stock
| 15
| 3.6 Financial Statements
| 15
| 3.7 Absence of Undisclosed Liabilities
| 16
| 3.8 Absence of Material Adverse Change
| 16
| 3.9 Absence of Litigation
| 16
| 3.10 Conduct of Business
| 16
| 3.11 Material Contracts
| 17
| 3.12 Regulatory Filings
| 17
| 3.13 Registration Statement, Etc.
| 17
| 3.14 Investment Bankers and Brokers
| 18
| 3.15 Accounting and Tax Treatment
| 18
| 3.16 Agreements With Bank Regulators
| 18
| 3.17 Reserve for Loan Losses
| 18
| 3.18 Year 2000 Compliance
| 18
|
| Article IV - Grand Premier's Representations and Warranties
| 19
| 4.1 Authorization, No Conflicts, Etc.
| 19
| 4.2 Organization and Good Standing
| 20
- i -
Table of Contents
-- Continued --
|
| Page
|
| 4.3 Subsidiaries
| 21
| 4.4 Capital Stock
| 22
| 4.5 Amendment of Grand Premier Rights
| 23
| 4.6 Financial Statements
| 23
| 4.7 Absence of Undisclosed Liabilities
| 24
| 4.8 Absence of Material Adverse Change
| 24
| 4.9 Absence of Litigation
| 24
| 4.10 No Indemnification Claims
| 24
| 4.11 Conduct of Business
| 25
| 4.12 Contracts
| 25
| 4.13 Regulatory Filings
| 25
| 4.14 Registration Statement, Etc.
| 26
| 4.15 Agreements With Bank Regulators
| 26
| 4.16 Tax Matters
| 26
| 4.17 Title to Properties
| 28
| 4.18 Condition of Real Property
| 28
| 4.19 Real and Personal Property Leases
| 29
| 4.20 Required Licenses, Permits, Etc.
| 29
| 4.21 Material Contracts
| 30
| 4.22 Certain Employment Matters
| 30
| 4.23 Employee Benefit Plans
| 31
| 4.24 Environmental Matters
| 32
| 4.25 Duties as Fiduciary
| 34
| 4.26 Investment Bankers and Brokers
| 35
| 4.27 Fairness Opinion
| 35
| 4.28 Grand Premier-Related Persons
| 35
| 4.29 Change in Business Relationships
| 36
| 4.30 Insurance
| 36
| 4.31 Books and Records
| 36
| 4.32 Loan Guarantees
| 36
| 4.33 Events Since December 31, 1998
| 37
| 4.34 Reserve for Loan and Lease Losses
| 37
| 4.35 Loan Origination and Servicing
| 37
| 4.36 No Xxxxxxx Xxxxxxx
| 38
| 4.37 Year 2000 Compliance
| 38
| 4.38 Joint Ventures; Strategic Alliances
| 38
| 4.39 Policies and Procedures
| 39
| 4.40 Accounting and Tax Treatment
| 39
|
| Article V - Covenants Pending Closing
| 39
| 5.1 Disclosure Statements; Additional Information
| 39
| 5.2 Changes Affecting Representations
| 40
- ii -
Table of Contents
-- Continued --
|
| Page
|
| 5.3 Grand Premier's Conduct of Business Pending the Effective Time
| 40
| 5.4 Approval of Plan of Merger by Grand Premier Stockholders
| 43
| 5.5 Regular Dividends
| 44
| 5.6 Technology-Related Contracts
| 45
| 5.7 Affiliates -- Compliance with Accounting and Securities Rules.
| 45
| 5.8 Indemnification and Insurance
| 46
| 5.9 Exclusive Commitment
| 47
| 5.10 Registration Statement
| 48
| 5.11 Other Filings
| 48
| 5.12 Miscellaneous Agreements and Consents
| 48
| 5.13 Access and Investigation
| 48
| 5.14 Confidentiality
| 49
| 5.15 Environmental Investigation
| 50
| 5.16 Implementation Agreements
| 51
| 5.17 Grand Premier Savings Plan
| 51
| 5.18 Accounting and Tax Treatment
| 51
| 5.19 Public Announcements
| 52
| 5.20 Year 2000 Preparations
| 52
|
| Article VI - Conditions Precedent to Old Kent's Obligations
| 52
| 6.1 Renewal of Representations and Warranties, Etc.
| 52
| 6.2 Opinion of Legal Counsel
| 53
| 6.3 Required Regulatory Approvals
| 53
| 6.4 Stockholder Approval
| 53
| 6.5 Order, Decree, Etc.
| 53
| 6.6 Tax Matters
| 53
| 6.7 Registration Statement
| 54
| 6.8 Certificate as to Outstanding Shares
| 54
| 6.9 Change of Control Waivers
| 54
| 6.10 Pooling Assurances
| 54
| 6.11 Year 2000 Disruptions
| 54
|
| Article VII - Conditions Precedent to Grand Premier's Obligations
| 55
| 7.1 Renewal of Representations and Warranties, Etc.
| 55
| 7.2 Opinion of Legal Counsel
| 55
| 7.3 Required Regulatory Approvals
| 55
| 7.4 Stockholder Approval
| 55
| 7.5 Order, Decree, Etc.
| 55
| 7.6 Tax Matters
| 56
| 7.7 Registration Statement
| 56
| 7.8 Fairness Opinion
| 56
| 7.9 Listing of Shares
| 57
- iii -
Table of Contents
-- Continued --
|
| Page
|
| Article VIII - Abandonment of Merger
| 57
| 8.1 Mutual Abandonment
| 57
| 8.2 Upset Date
| 57
| 8.3 Old Kent's Rights to Terminate
| 57
| 8.4 Grand Premier's Rights to Terminate
| 58
| 8.5 Effect of Termination
| 58
|
| Article IX - Miscellaneous
| 59
| 9.1 "Material Adverse Effect" Defined
| 59
| 9.2 "Knowledge" Defined
| 59
| 9.3 Nonsurvival of Representations, Warranties, and Agreements
| 59
| 9.4 Amendment
| 59
| 9.5 Expenses
| 60
| 9.6 Specific Enforcement
| 60
| 9.7 No Jury
| 60
| 9.8 Waiver
| 60
| 9.9 Notices
| 60
| 9.10 Governing Law
| 61
| 9.11 Entire Agreement
| 61
| 9.12 Third Party Beneficiaries
| 61
| 9.13 Counterparts
| 61
| 9.14 Further Assurances; Privileges
| 62
| 9.15 Headings, Etc.
| 62
| 9.16 Calculation of Dates and Deadlines.
| 62
| 9.17 Severability
| 62
|
| DEFINITIONS
|
|
| AMEX
| 6
| Bank Consolidation
| 3
| Bank Consolidation Agreement
| 3
| Book Entry Shares
| 9
| Business Combination
| 47
| Business Day
| 2
| Call Reports
| 24
| CERCLA
| 33
| Certificates of Merger
| 2
| Closing
| 2
| Constituent Corporation
| 1
| Control
| 21
| Credit Suisse First Boston
| 35
- iv -
Table of Contents
-- Continued --
|
| Page
|
| Designated Contracts
| 54
| DGCL
| 1
| Effective Time
| 2
| Employee Benefit Plan
| 31
| Employment-Related Payments
| 30
| Environmental Laws
| 33
| Environmental Risk
| 50
| ERISA
| 31
| Ex-Date
| 6
| Exchange Act
| 38
| Exchange Agent
| 10
| Exchange Ratio
| 3
| FDIA
| 13
| FDIC
| 16
| Federal Bank Holding Company Act
| 13
| Federal Reserve Board
| 14
| FIB
| 17
| Fiduciary Event
| 44
| Final Index Price
| 6
| Final Old Xxxx Xxxxx
| 6
| Floor Old Xxxx Xxxxx
| 5
| GAAP
| 15
| Grand Premier
| 1
| Grand Premier Adjustment Factor
| 8
| Grand Premier Affiliate Agreements
| 45
| Grand Premier Bank
| 1
| Grand Premier Banks
| 1
| Grand Premier Capital Stock
| 5
| Grand Premier Common Stock
| 2
| Grand Premier Disclosure Statement
| 19
| Grand Premier Option Plans
| 11
| Grand Premier Preferred Stock
| 4
| Grand Premier Rights
| 22
| Grand Premier Rights Agreement
| 22
| Grand Premier Savings Plan
| 22
| Grand Premier Series B Preferred Stock
| 4
| Grand Premier Series C Preferred Stock
| 4
| Grand Premier's Financial Statements
| 23
| Grand Premier's Leases
| 29
| Grand Premier's Real Property
| 28
| Grand Premier's Representatives
| 35
| Grand Premier-Related Person
| 35
- v -
Table of Contents
-- Continued --
|
| Page
|
| Hazardous Substance
| 33
| Implementation Agreements
| 51
| Index Companies
| 6
| Initial Index Date
| 6
| Initial Index Price
| 6
| Initial Old Xxxx Xxxxx
| 6
| Insurance Xxxxxx
| 00
| Xxxxxxxx Xxxxxxx Code
| 1
| IRS
| 27
| Knowledge
| 59
| Material Adverse Effect
| 59
| Merger
| 1
| MergerSub
| 1
| Michigan Act
| 1
| Michigan Banking Code
| 3
| NASDAQ
| 6
| National Bank Act
| 3
| National Bank Act
| 40
| NYSE
| 6
| OCC
| 00
| Xxx Xxxxxx Xxxxxxxxxxxx
| 0
| Xxx Xxxx
| 1
| Old Kent Adjustment Factor
| 7
| Old Kent Capital Stock
| 0
| Xxx Xxxx Xxxxxx Xxxxx
| 0
| Xxx Xxxx Disclosure Statement
| 00
| Xxx Xxxx XXXX
| 0
| Xxx Xxxx Rights Agreement
| 00
| Xxx Xxxx Xxxxxx
| 00
| Xxx Xxxx Series D Preferred Stock
| 4
| Old Kent Series E Preferred Stock
| 4
| Old Kent's Financial Statements
| 15
| Old Preferred Certificates
| 9
| Option Agreement
| 1
| PBGC
| 32
| Permitted Issuances
| 9
| Phase I
| 50
| Phase II and III Work
| 50
| Plan of Merger
| 1
| Premises
| 33
| Pricing Period
| 6
| Proposal
| 47
- vi -
Table of Contents
-- Continued --
|
| Page
|
| Prospectus and Proxy Statement
| 17
| Registration Statement
| 17
| SEC
| 14
| Securities Act
| 45
| Series D Conversion Price
| 4
| Stock Distribution
| 6
| Stockholders' Meeting
| 43
| Superior Proposal
| 44
| Surviving Corporation
| 1
| Tax Returns
| 27
| Taxes
| 26
| Technology-Related Contracts
| 45
| Transaction Documents
| 17
| Unexercised Options
| 11
| Upset Condition
| 5
| Voting Agreement
| 20
| Year 2000 Assets
| 19
| Year 2000 Ready
| 19
|
|
| Exhibits
|
|
| A -- Form of Stock Option Agreement
| A-1
| B -- Form of Certificate of Designation of Old Kent Preferred Stock
| B-1
| C -- Index Companies
| C-1
| D -- Form of Disclosure Statement
| D-1
| E -- Schedule of Additional Information
| E-1
| F -- Form of Grand Premier's Affiliate Agreement
| F-1
| G -- Form of Grand Premier's Counsel's Legal Opinion
| G-1
| H -- Form of Old Kent's Counsel's Legal Opinion
| H-1
| I -- Designated Contracts
| I-1
- vii -
AGREEMENT AND PLAN OF MERGER
This Agreement and Plan of Merger (this "Plan of Merger") is made as of September 9, 1999,
between Grand Premier Financial, Inc., a Delaware corporation ("Grand Premier"), Old Kent
Financial Corporation, a Michigan corporation ("Old Kent"), and OK Merger Corporation, a
Michigan corporation ("MergerSub").
Old Kent and Grand Premier desire that Grand Premier and its subsidiaries become affiliated
with Old Kent. The affiliation would be effected through the merger of Grand Premier with and into
MergerSub in accordance with this Plan of Merger, the Business Corporation Act of the State of
Michigan, as amended (the "Michigan Act"), and the Delaware General Corporation Law, as amended
(the "DGCL"). The transactions contemplated by, and described in, this Plan of Merger are referred
to as the "Merger."
Old Kent has formed MergerSub solely for the purpose of effectuating the Merger. As soon
as reasonably practicable following the consummation of the Merger, Old Kent intends to cause
MergerSub to be liquidated and dissolved, and to cause Grand National Bank ("Grand Premier
Bank") and Grand Premier Trust and Investment, Inc., N.A. ("Grand Premier Trust Bank," and with
Grand Premier Bank, the "Grand Premier Banks"), to be consolidated with and into Old Kent's wholly
owned subsidiary, Old Kent Bank, a Michigan banking corporation.
It is intended that, for federal tax purposes, the Merger qualify as a reorganization under the
provisions of Section 368 of the Internal Revenue Code of 1986, as amended (the "Internal Revenue
Code"). It is also intended that, for accounting and financial reporting purposes, the Merger shall be
accounted for as a pooling-of-interests.
As a condition to, and concurrently with the execution of, this Plan of Merger, Grand Premier
and Old Kent are entering into a Stock Option Agreement attached as Exhibit A (the "Option
Agreement"). Grand Premier's execution and delivery of the Option Agreement is an inducement for
Old Kent to enter into this Plan of Merger.
In consideration of the representations, warranties, and covenants contained in this Plan of
Merger, the parties agree:
Article I - The Transaction
Subject to the terms and conditions of this Plan of Merger, the Merger shall be carried out in
the following manner:
1.1 Merger of Grand Premier with and into MergerSub. At the Effective Time, Grand
Premier shall be merged with and into MergerSub. Grand Premier and MergerSub are each sometimes
referred to as a "Constituent Corporation" prior to the Merger. At the Effective Time, the Constituent
Corporations shall become a single corporation, which shall be MergerSub (the "Surviving
Corporation"). The effect of the Merger upon each of the Constituent Corporations and the Surviving
Corporation shall be as provided in Chapter Seven of the Michigan Act and Section 252 of the DGCL
with respect to the merger of domestic and foreign corporations, where the surviving corporation will
be subject to the laws of the State of Michigan.
1.2 The Closing. The "Closing" for the Merger shall be held at the offices of Xxxxxx
Xxxxxxxx & Xxxx llp, 000 Xxxx Xxxxxx, X.X., Xxxxx Xxxxxx, Xxxxxxxx, commencing at 11 a.m. on the
earliest date specified by either Old Kent or Grand Premier upon five Business Days' (defined below)
written notice after the last to occur of the following events: (a) receipt of all consents and approvals
of government regulatory authorities, and the expiration of all related statutory waiting periods, legally
required to consummate the Merger; and (b) adoption of this Plan of Merger by the holders of the
common stock, $0.01 par value per share, of Grand Premier ("Grand Premier Common Stock").
Scheduling or commencing the Closing shall not, however, constitute a waiver of the conditions
precedent of either Old Kent and MergerSub or Grand Premier as set forth in Articles VI and VII,
respectively. Notwithstanding the above: (a) the Closing shall not be convened prior to March 15,
2000 without Old Kent's express written consent, and (b) if Old Kent gives notice of a Closing to occur
prior to March 1, 2000, then such notice must be given at least 15 Business Days prior to the Closing.
Upon completion of the Closing, Grand Premier and MergerSub shall each execute and file the
certificate of merger as required by the Michigan Act and the DGCL to effect the Merger (together,
the "Certificates of Merger"). No party shall take any action to revoke either or both of the
Certificates of Merger after their filing without the written consent of the other party.
1.3 Effective Time of the Merger. The Merger shall be consummated following the Closing
by filing on the date of the Closing the Certificates of Merger in the manner required by law. The
"Effective Time" of the Merger shall be as of a time and Business Day mutually agreed upon by the
parties, and in the absence of such an agreement, as of a time and Business Day to be selected by Old
Kent, and in either case, specified in the Certificates of Merger. Notwithstanding the above, the
Effective Time shall neither be (a) earlier than March 17, 2000 without Old Kent's prior written
consent (which consent shall be evidenced by MergerSub's execution of the Certificates of Merger),
nor (b) later than five Business Days after the Closing occurs. The term "Business Day" means any
day other than a Saturday, Sunday, or other day on which the New York Stock Exchange is closed.
1.4 Additional Actions. At any time after the Effective Time, the Surviving Corporation may
determine that further assignments or assurances or any other acts are necessary or desirable to vest,
perfect, or confirm, of record or otherwise, in the Surviving Corporation its rights, title, or interest in,
to, or under any of the rights, properties, or assets of Grand Premier acquired or to be acquired by the
Surviving Corporation as a result of, or in connection with, the Merger, or to otherwise carry out the
purposes of this Plan of Merger. Grand Premier hereby grants to the Surviving Corporation an
irrevocable power of attorney to execute and deliver all such deeds, assignments, and assurances and
to do all acts necessary, proper, or convenient to accomplish this purpose; provided that this
irrevocable power of attorney shall only be operative following the Effective Time. The officers and
directors of the Surviving Corporation shall be fully authorized in the name of Grand Premier to take
any and all such actions contemplated by this Plan of Merger.
1.5 Surviving Corporation. As of the Effective Time, the Surviving Corporation shall have
the following attributes until they are subsequently changed in the manner provided by law:
- 2 -
|
| 1.5.1 Name. The name of the Surviving Corporation shall be "OK Merger
Corporation."
|
|
| 1.5.2 Articles of Incorporation. The articles of incorporation of the Surviving
Corporation shall be the amended and restated articles of incorporation of MergerSub as in
effect immediately prior to the Effective Time, without change.
|
|
| 1.5.3 Bylaws. The bylaws of the Surviving Corporation shall be the bylaws of
MergerSub as in effect immediately prior to the Effective Time, without change.
|
|
| 1.5.4 Directors. The directors of the Surviving Corporation shall be the same as the
directors of MergerSub immediately prior to the Effective Time.
|
|
| 1.5.5 Officers. The officers of the Surviving Corporation shall be the same as the
officers of MergerSub immediately prior to the Effective Time.
1.6 Bank Consolidation. Old Kent intends to consolidate the Grand Premier Banks with and
into Old Kent Bank resulting in a single Michigan banking corporation, which shall be Old Kent Bank
(the "Bank Consolidation"), after the Effective Time. The Bank Consolidation will be effected
pursuant to a consolidation agreement (the "Bank Consolidation Agreement"), in the form required
by the Michigan Banking Code of 1969, as amended (the "Michigan Banking Code"), the National
Bank Act, as amended (the "National Bank Act"), and by any other applicable laws, containing terms
and conditions, determined by Old Kent, not inconsistent with this Plan of Merger. The Bank
Consolidation shall only occur if the Merger is consummated, and it shall become effective immediately
after the Effective Time or such later time as may be determined by Old Kent. To obtain the necessary
regulatory approval for the Bank Consolidation to occur immediately after the Effective Time, Grand
Premier and the Grand Premier Banks shall approve, adopt, execute, and deliver the Bank Consolidation Agreement and take all other reasonable steps requested by Old Kent prior to the Effective
Time to effect the Bank Consolidation; provided that neither Grand Premier nor the Grand Premier
Banks shall be required to incur any material cost or take any irrevocable action in connection with its
obligations under this Section.
Article II - Conversion and Exchange of Shares
Subject to the terms and conditions of this Plan of Merger and as a result of the Merger, all of
the capital stock of Grand Premier shall be converted as follows:
2.1 Conversion of Shares. As of the Effective Time:
|
|
2.1.1 Conversion of Grand Premier Common Stock. Except as provided in Article II,
each share of Grand Premier Common Stock outstanding immediately prior to the Effective
Time shall be converted into 0.4231 (the "Exchange Ratio") shares of validly issued, fully paid,
and nonassessable common stock, $1.00 par value per share, of Old Kent ("Old Kent Common
Stock") .
- 3 -
|
| 2.1.2 Conversion of Grand Premier Series B Preferred Stock. Each share of Grand
Premier's Series B Perpetual Preferred Stock, with no par value and with a stated value of
$1,000 per share, with a right of conversion into Grand Premier Common Stock ("Grand
Premier Series B Preferred Stock") outstanding immediately prior to the Effective Time (other
than Dissenting Shares (as defined below)) shall be converted into one share of Series D
preferred stock of Old Kent, with no par value and a stated value of $1,000 per share, with a
right of conversion into Old Kent Common Stock (the "Old Kent Series D Preferred Stock").
Accrued but unpaid dividends on the Grand Premier Series B Preferred Stock to the Effective
Time shall become accrued but unpaid dividends on Old Kent Series D Preferred Stock. The
terms of the Old Kent Series D Preferred Stock shall be as specified in the Certificate of
Designation, Preferences and Rights of Series D Perpetual Preferred Stock attached as Exhibit
B, which terms are intended to be substantially identical to the terms of the Grand Premier
Series B Preferred Stock, except that Old Kent Series D Preferred Stock shall be convertible
into Old Kent Common Stock at a price of $18.2905 per share (the "Series D Conversion
Price") of Old Kent Common Stock. Old Kent shall, prior to the Closing, take all measures
legally required to create the class of Old Kent Series D Preferred Stock and authorize the
issuance of such shares.
|
|
| 2.1.3 Conversion of Grand Premier Series C Preferred Stock. Each share of Grand
Premier's Series C Perpetual Preferred Stock, par value $0.01 per share and with a stated value
of $1,000 per share (the "Grand Premier Series C Preferred Stock," and with the Grand
Premier Series B Preferred Stock, referred to as the "Grand Premier Preferred Stock")
outstanding immediately prior to the Effective Time (other than Dissenting Shares) shall be
converted into one share of Series E preferred stock of Old Kent, with no par value and a
stated value of $1,000 per share (the "Old Kent Series E Preferred Stock," and with the Old
Kent Series D Preferred Stock, referred to as the "Old Kent Preferred Stock"). Accrued but
unpaid dividends on the Grand Premier Series C Preferred Stock to the Effective Time shall
become accrued but unpaid dividends on Old Kent Series E Preferred Stock. The terms of the
Old Kent Series E Preferred Stock shall be as specified in the Certificate of Designation,
Preferences and Rights of Series E Perpetual Preferred Stock attached as Exhibit B, which
terms are intended to be substantially identical to the terms of the Grand Premier Series C
Preferred Stock. Old Kent shall, prior to the Closing, take all measures legally required to
create the class of Old Kent Series E Preferred Stock and authorize the issuance of such shares.
The Old Kent Common Stock and Old Kent Preferred Stock shall be collectively referred to
as the "Old Kent Capital Stock."
|
|
| 2.1.4 Old Kent Rights. Each share of Old Kent Common Stock to be issued in the
Merger shall have attached to it the number of "Old Kent Rights" issuable pursuant to the "Old
Kent Rights Agreement" (as those terms are defined in Section 3.4.1 (Classes and Shares --
Old Kent)) that are attached to each issued and outstanding share of Old Kent Common Stock
at the Effective Time. No Old Kent Rights shall be attached to Old Kent Common Stock if the
Old Kent Rights are then separately transferable.
- 4 -
|
| 2.1.5 No Conversion of Old Kent Common Stock. Each share of Old Kent Common
Stock and each Old Kent Right outstanding immediately prior to the Effective Time shall
continue to be outstanding without any change.
|
|
| 2.1.6 Conversion of MergerSub Common Stock. Each share of common stock,
without par value, of MergerSub issued and outstanding immediately prior to the Effective
Time shall be converted automatically into and become one fully paid and nonassessable share
of common stock, without par value, of the Surviving Corporation. As a result of the Merger,
Old Kent shall own all of the issued and outstanding shares of the Surviving Corporation.
|
|
| 2.1.7 Stock Held by Old Kent. Each share of Grand Premier Common Stock and
Grand Premier Preferred Stock (collectively, "Grand Premier Capital Stock"), if any, held by
Old Kent or any of its subsidiaries for its own account, and not in a fiduciary or representative
capacity for a person other than Old Kent or any of its subsidiaries, shall be canceled and no
consideration shall be issuable or payable with respect to any such share.
|
|
| 2.1.8 Treasury Shares. Each share of Grand Premier Capital Stock held by Grand
Premier as a treasury share (excluding shares held in a fiduciary or representative capacity
under Grand Premier's benefit plans), if any, shall be canceled and no Old Kent Common Stock
or other consideration shall be issuable or payable with respect to any such share.
|
|
| 2.1.9 Dissenting Shares. Any shares of Grand Premier Preferred Stock held by a
holder who shall not have voted the shares in favor of this Plan of Merger and who shall be
eligible for and shall have complied with the applicable procedures of Section 262 of the DGCL
and who shall not have withdrawn his or her demand for appraisal and accepted the Merger
pursuant to Section 262 of the DGCL ("Dissenting Shares") shall, at and after the Effective
Time, have the status of authorized but unissued shares of the Surviving Corporation.
Notwithstanding any other provision of this Plan of Merger, any Dissenting Shares shall not,
after the Effective Time, be entitled to vote for any purpose or receive any dividends or other
distributions and shall be entitled only to the rights as are afforded in respect of Dissenting
Shares pursuant to the DGCL.
2.2 Upset Provision. Grand Premier shall have the right to terminate this Plan of Merger by
written notice to Old Kent at any time following the Pricing Period, upon the occurrence of an "Upset
Condition."
|
| 2.2.1 Upset Condition. An "Upset Condition" shall exist if both of the following
conditions then exist:
|
| (a) The Final Old Xxxx Xxxxx (defined below) is less than $33.46875 (the
"Floor Old Xxxx Xxxxx"); and
|
|
|
(b) The number determined by dividing the Final Old Xxxx Xxxxx by $39.375
(the "Initial Old Xxxx Xxxxx") is less than the number obtained by subtracting (i) 0.15
- 5 -
|
| from (ii) the quotient obtained by dividing the Final Index Price (defined below) by the
Initial Index Price (defined below).
|
| 2.2.2 Possible Adjustment of the Exchange Ratio. If Grand Premier gives written
notice of termination of the Plan of Merger pursuant to this Section 2.2, Grand Premier may,
but shall not be obligated to, proceed with the Merger, without any further approval of the
stockholders of Grand Premier, in the event that Old Kent shall agree, within five Business
Days of receipt of such notice of termination, to adjust the Exchange Ratio so that it exceeds
the Exchange Ratio (as then in effect) and such adjusted exchange ratio is approved by the
board of directors, or a duly authorized committee of the board of directors, of Grand Premier.
|
|
| 2.2.3 Final Old Xxxx Xxxxx. The "Final Old Xxxx Xxxxx" means the average of the
closing prices per share of Old Kent Common Stock reported on the New York Stock
Exchange ("NYSE") for the ten consecutive full trading days ending on the sixth Business Day
prior to the date of the Closing (the "Pricing Period"), as reported in the Dow Xxxxx News/Retrieval system, or other equally reliable means.
|
|
| 2.2.4 Initial Index Price. The "Initial Index Price" means the average of the closing
prices per share of each of the common stocks of the Index Companies (defined below) as
reported on NYSE, The Nasdaq Stock Market ("NASDAQ"), or the American Stock Exchange
("AMEX") on September 9, 1999 ("Initial Index Date"). The Initial Index Price computed
as of a recent date is presented in Exhibit C as an illustration of the method of computation,
but is subject to adjustment as provided in Sections 2.2.7 (Index Adjustments).
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|
| 2.2.5 Final Index Price. The "Final Index Price" means the average of the average
closing prices per share of each of the common stocks of the Index Companies as reported on
NYSE, NASDAQ, or AMEX for each trading day during the Pricing Period.
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| 2.2.6 Index Companies. The term "Index Companies" refers to the companies listed
on Exhibit C, as the list may be modified under Section 2.2.8 (Index Exclusions).
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| 2.2.7 Index Adjustments. If any Index Company declares a stock dividend, stock split,
or stock split-up (any such event being a "Stock Distribution") of its common stock for which
the ex-dividend date, ex-split date, ex-distribution date or other comparable date (the "Ex-Date") occurs between the Initial Index Date and the end of the Pricing Period, then for
purposes of the definitions in Section 2.2 (Upset Provision) the closing prices for such common
stock as of the Initial Index Date and each date during the Pricing Period prior to the Ex-Date
shall be adjusted so as to be comparable as of the Initial Index Date and throughout the Pricing
Period in the same manner as is described in Section 2.3.1(c) (Stock Dividends and
Distributions) for any Stock Distribution.
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|
| 2.2.8 Index Exclusions. There shall be excluded from the list of Index Companies any
company as to which, between the Initial Index Date and the end the Pricing Period, there
occurs or there is publicly announced (a) a proposed merger, acquisition, or business
combination in which that company is not or will not ultimately be the survivor, (b) a tender
- 6 -
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| offer, exchange offer, other transaction involving or proposing to involve the acquisition of a
majority of that company's common stock or assets, or (c) a reclassification, recapitalization,
subdivision, spin-off, split-up, or combination of its common stock; provided that if eight or
more of the Index Companies are excluded pursuant to this Section, then, unless Old Kent and
Grand Premier agree otherwise, Old Kent and Grand Premier shall agree upon mutually
acceptable substitute Index Companies. If a company is excluded from the list of Index
Companies, then the Initial Index Price and the Final Index Price shall be calculated as if the
excluded company had not originally been included in the list of companies.
2.3 Adjustments. The Exchange Ratio, Series D Conversion Price, Floor Old Xxxx Xxxxx,
Initial Old Xxxx Xxxxx, and Final Old Xxxx Xxxxx, and the related computations described in Sections 2.1
(Conversion of Shares) and 2.2 (Upset Provision) shall be adjusted in the manner provided in this
Section upon the occurrence of any of the following events:
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| 2.3.1 Stock Dividends and Distributions. If Old Kent declares a Stock Distribution
of Old Kent Common Stock to its holders prior to the Effective Time, then:
|
| (a) If the record date for the Stock Distribution occurs prior to the Effective
Time, then the Exchange Ratio shall be adjusted by multiplying it by that ratio (the "Old
Kent Adjustment Factor") (i) the numerator of which shall be the total number of
shares of Old Kent Common Stock that are outstanding as of the record date for such
Stock Distribution plus the additional number of shares to be issued in the Stock
Distribution computed as of that record date; and (ii) the denominator of which shall
be the total number of shares of Old Kent Common Stock outstanding as of the Stock
Distribution's record date; and
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|
| (b) If the record date for the Stock Distribution occurs prior to the Effective
Time, then the Series D Conversion Price shall be adjusted by dividing it by the Old
Kent Adjustment Factor.
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|
| (c) If the Ex-Date for the Stock Distribution occurs before the end of the
Pricing Period, then the Floor Old Xxxx Xxxxx and the Initial Old Xxxx Xxxxx (and if the
Ex-Date occurs during the Pricing Period, then the closing price per share of Old Kent
Common Stock for each day during the Pricing Period prior to the Ex-Date) shall each
be adjusted by dividing them by the Old Kent Adjustment Factor.
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| 2.3.2 Other Action Affecting Old Kent Common Stock. In the event of a reclassification of outstanding shares of Old Kent Common Stock or a consolidation or merger of Old
Kent with or into another corporation, other than a merger in which Old Kent is ultimately the
surviving corporation and which merger does not result in any reclassification of Old Kent
Common Stock, holders of Grand Premier Common Stock shall receive, in lieu of each share
of Old Kent Common Stock to be issued in exchange for Grand Premier Common Stock based
on the Exchange Ratio, the kind and amount of shares of Old Xxxx xxxxx, other securities,
money, and/or property receivable upon such reclassification, consolidation, or merger by
- 7 -
|
| holders of Old Kent Common Stock with respect to each share of Old Kent Common Stock
outstanding immediately prior to such reclassification, consolidation, or merger.
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|
| 2.3.3 Employee Stock Options, Etc. Notwithstanding any other provisions of this
Section, no adjustment shall be made in the event of the issuance of additional shares of Old
Kent Common Stock pursuant to the dividend reinvestment plan of Old Kent (the "Old Kent
DRIP"), pursuant to the exercise of stock options awarded under director or employee stock
option plans of Old Kent, or upon the grant or sale of shares or rights to receive shares to, or
for the account of, Old Kent directors or employees pursuant to restricted stock, deferred stock
compensation, thrift, employee stock purchase, and other compensation or benefit plans of Old
Kent.
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|
| 2.3.4 Authorized but Unissued Shares. Notwithstanding the other provisions of this
Section, no adjustment shall be made in the event of the issuance of additional shares of Old
Kent Common Stock or other securities pursuant to a public offering, private placement, or an
acquisition of one or more banks, corporations, or business assets as authorized by the board
of directors of Old Kent or a duly authorized committee of the board.
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|
| 2.3.5 Changes in Capital. Subject only to making any adjustment to the Exchange
Ratio and related computations prescribed by this Section, nothing contained in this Plan of
Merger shall preclude Old Kent from amending its restated articles of incorporation to change
its capital structure or from issuing additional shares of Old Kent Common Stock, preferred
stock, shares of other capital stock, or securities that are convertible into shares of capital
stock.
2.4 Increase in Outstanding Shares of Grand Premier Common Stock. If the number of shares
of Grand Premier Common Stock outstanding at the Effective Time is greater than 22,359,791 for any
reason whatsoever (whether or not such increase constitutes a breach of this Plan of Merger) other
than as a result of Permitted Issuances (defined below), then:
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| 2.4.1 Exchange Ratio. The Exchange Ratio shall be adjusted by multiplying it by a
fraction (the "Grand Premier Adjustment Factor") (i) the numerator of which shall be
22,359,791 (the total number of shares of Grand Premier Common Stock outstanding as of the
date of this Plan of Merger), and (ii) the denominator of which shall be the total number of
shares of Grand Premier Common Stock outstanding as of the Effective Time of the Merger,
excluding Permitted Issuances (as defined below); and
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|
| 2.4.2 Series D Conversion Price. The Series D Conversion Price shall be adjusted by
dividing it by the Grand Premier Adjustment Factor.
"Permitted Issuances" include and are limited to: (i) the issuance of not more than 357,406 shares of
Grand Premier Common Stock upon the exercise of previously awarded and currently outstanding
stock options identified in Section 4.4 (Capital Stock); (ii) the issuance of shares upon the exercise of
stock options awarded in December 1999 under the Grand Premier Options Plans, which awards are
consistent in amount, nature, and timing with Grand Premier's past practices with respect to awards
- 8 -
made under the Grand Premier Option Plans (as defined below) and in no event shall such awards
exceed options to purchase 95,000 shares (in the aggregate); and (iii) the issuance of not more than
936,852 shares of common stock upon the conversion of Grand Premier Series B Preferred Stock.
2.5 Cessation of Stockholder Status. As of the Effective Time, each record holder of shares
of Grand Premier Common Stock outstanding immediately prior to the Effective Time shall cease to
be a stockholder of Grand Premier and shall have no rights as a stockholder of Grand Premier. Each
stock certificate representing shares of Grand Premier Common Stock outstanding immediately prior
to the Effective Time ("Old Common Certificates") shall then be considered to represent shares of Old
Kent Common Stock and the right, if any, to receive cash in lieu of fractional shares, all as provided
in this Plan of Merger. As of the Effective Time, except with respect to any Dissenting Shares, each
record holder of shares of Grand Premier Preferred Stock outstanding immediately prior to the
Effective Time shall cease to be a stockholder of Grand Premier and shall have no rights as a
stockholder of Grand Premier, and each stock certificate representing shares of Grand Premier
Preferred Stock outstanding immediately prior to the Effective Time ("Old Preferred Certificates")
shall then be considered to represent shares of the applicable Old Kent Preferred Stock and the right,
if any, to receive cash for any accrued but unpaid dividends thereon, all as provided in this Plan of
Merger.
2.6 Surrender of Old Certificates and Distribution of Stock. After the Effective Time, Old
Common Certificates shall be exchangeable by the holders thereof for book entry shares registered on
Old Kent's stock transfer records ("Book Entry Shares") or new stock certificates representing the
number of shares of Old Kent Common Stock to which such holders shall be entitled in the following
manner:
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| 2.6.1 Transmittal Materials. As soon as practicable, but in no event later than ten
Business Days after the Effective Time, Old Kent shall send or cause to be sent to each record
holder of Grand Premier Capital Stock as of the Effective Time transmittal materials for use
in exchanging that holder's Old Common Certificates and Old Preferred Certificates pursuant
to the following. Old Common Certificates shall have the following options: (a) enrolling in
the Old Kent DRIP with credit for all full and fractional shares received in the Merger; (b)
receiving Old Kent Common Stock certificates; and (c) receiving Book Entry Shares (but
without enrolling in the DRIP). The transmittal materials will contain instructions with respect
to the surrender of Old Common Certificates and the selection of these exchange options. In
the absence of a selection among these exchange options, the holder of Grand Premier
Common Stock shall be deemed to have elected to receive Book Entry Shares. Old Preferred
Certificates shall be exchanged for certificates of Old Kent Preferred Stock.
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|
| 2.6.2 Exchange Agent. On or prior to the Effective Time, Old Kent will deliver to Old
Kent Bank or such other bank or trust company as Old Kent may designate (the "Exchange
Agent"), written notice of the number of shares of Old Kent Capital Stock issuable in the
Merger and a commitment to pay the amount of cash payable for fractional shares in the
Merger when and as determined, and in the case of the conversion of the Grand Premier
Preferred Stock, a commitment to pay the amount of cash payable for any accrued but unpaid
dividends payable to holders of record as of record dates prior to the Effective Time. The
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|
| Exchange Agent shall not be entitled to vote or exercise any rights of ownership with respect
to such shares of Old Kent Capital Stock, except that it shall receive and hold all dividends or
other distributions paid or distributed with respect to such shares for the account of the record
holders entitled to such shares.
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|
| 2.6.3 New Stock Registrations. Old Kent shall cause the Exchange Agent to promptly
register the shares of Old Kent Capital Stock issuable to Grand Premier's holders of record in
such manner, in the names, and to the addresses that appear on Grand Premier's stock records
as of the Effective Time, or in such other name or to such other address as may be specified
by the holder of record in transmittal documents received by the Exchange Agent; provided,
that with respect to each Grand Premier stockholder, the Exchange Agent shall have received
all of the Old Common Certificates and Old Preferred Certificates held by that stockholder, or
an affidavit of loss and indemnity bond for such certificate or certificates, together with
properly executed transmittal materials; and such certificates, transmittal materials, affidavits,
and bonds are in a form and condition reasonably acceptable to Old Kent and the Exchange
Agent.
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|
| 2.6.4 Dividends Pending Surrender. Whenever a dividend is declared by Old Kent on
Old Kent Common Stock or Old Kent Preferred Stock that is payable to shareholders of record
of Old Kent as of a record date on or after the Effective Time, the declaration shall include
dividends on all shares issuable under this Plan of Merger. No former stockholder of Grand
Premier shall be entitled to receive a distribution of any such dividend until the physical
exchange of all of that stockholder's Old Common Certificates and Old Preferred Certificates
(or an affidavit of loss and indemnity bond for such certificates) shall have been effected
pursuant to properly submitted transmittal materials. Upon the physical exchange of that
stockholder's Old Common Certificates and Old Preferred Certificates (or an affidavit of loss
and indemnity bond for such certificates), the stockholder shall be entitled to receive from Old
Kent an amount equal to all such dividends (without interest thereon and less the amount of
taxes, if any, that may have been imposed or paid thereon) declared and paid with respect to
the shares of Old Kent Capital Stock represented thereby. If such stockholder elects to enroll
in the Old Kent DRIP, such amount shall be credited as a cash purchase for investment at the
plan's next regular investment date.
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| 2.6.5 Stock Transfers. After the Effective Time, there shall be no transfers on Grand
Premier's stock transfer books of the shares of Grand Premier Capital Stock that were issued
and outstanding immediately prior to the Effective Time. If, after the Effective Time, Old
Common Certificates and Old Preferred Certificates are properly presented for transfer, then
they shall be canceled and exchanged for shares of Old Kent Capital Stock as provided in this
Plan of Merger. After the Effective Time, ownership of such shares as are represented by any
Old Common Certificates and Old Preferred Certificates may be transferred only on the stock
transfer records of Old Kent.
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| 2.6.6 Exchange Agent's Discretion. The Exchange Agent shall have discretion to
determine and apply reasonable rules and procedures relating to the exchange (or lack thereof)
of Old Common Certificates and Old Preferred Certificates and the registration of the shares
of Old Kent Capital Stock into which shares of Grand Premier Capital Stock are converted in
the Merger and governing the payment for fractional shares of Grand Premier Capital Stock.
2.7 No Fractional Shares. Notwithstanding any other provision of this Article II, no
certificates or scrip representing fractional shares of Old Kent Capital Stock shall be issued in the
Merger upon the surrender of Old Common Certificates or Old Preferred Certificates. No fractional
interest in any share of Old Kent Common Stock resulting from the Merger shall be entitled to any part
of a Stock Distribution with respect to shares of Old Kent Common Stock nor entitle the record holder
to vote or exercise any rights of a stockholder with respect to that fractional interest. In lieu of issuing
any fractional share, each holder of an Old Common Certificate who would otherwise have been
entitled to a fractional share of Old Kent Common Stock upon surrender of all Old Common
Certificates for exchange shall be paid an amount in cash (without interest) equal to such fraction of
a share multiplied by the Final Old Xxxx Xxxxx. If the holder of record elects to enroll in Old Kent's
DRIP, then the cash in lieu of fractional shares shall be held for reinvestment at the plan's next regular
investment date.
2.8 Stock Options.
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| 2.8.1 Conversion of Options. Each unexercised stock option ("Unexercised Options")
under the Grand Premier Financial, Inc. 1996 Non-Qualified Stock Option Plan, the Premier
Financial Services, Inc. 1995 Non-Qualified Stock Option Plan, the Premier Financial Services,
Inc. 1988 Non-Qualified Stock Option Plan, and the 1998 Grand Premier Financial, Inc. Non-Employee Director Stock Option Plan (collectively, the "Grand Premier Option Plans")
outstanding at the Effective Time shall become, at the Effective Time, an option to purchase
that number of shares of Old Kent Common Stock equal to the number of shares of Grand
Premier Common Stock subject to such Unexercised Option multiplied by the Exchange Ratio,
rounded to the nearest whole share. Old Kent acknowledges and agrees that, pursuant to the
terms of the Grand Premier Financial, Inc. 1996 Non-Qualified Stock Option Plan, the Premier
Financial Services, Inc. 1995 Non-Qualified Stock Option Plan, and the 1998 Grand Premier
Financial, Inc. Non-Employee Director Stock Option Plan and related agreements, all of the
Unexercised Options outstanding as of the Effective Time under such plans shall become fully
vested and exercisable at the Effective Time.
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|
| 2.8.2 Option Exercises. The exercise price per share of Old Kent Common Stock
under each Unexercised Option shall be equal to the exercise price per share of the Grand
Premier Common Stock that was purchasable under that option divided by the Exchange Ratio
(rounded to the nearest whole cent).
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| 2.8.3 Option Plans Assumption. As of the Effective Time of the Merger, Old Kent shall
assume the rights, duties and obligations of Grand Premier under the Grand Premier Option
Plans, as amended by this Plan of Merger. The duration and other terms and conditions of
the assumed options shall be the same as the original Grand Premier options, except that any
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| reference to Grand Premier shall be considered to be references to Old Kent. In no event shall
any subsequent merger or amendment of the Grand Premier Option Plans adversely affect the
terms, rights, benefits, and features of the Unexercised Options without the consent of the
holders thereof.
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| 2.8.4 Registration. Old Kent shall use all commercially reasonable efforts to file before
or promptly after the Effective Time, and use all commercially reasonable efforts to maintain
the effectiveness of, a registration statement with the SEC covering such options and the sale
of the Old Kent Common Stock issuable upon exercise of such options so long as unexercised
options remain outstanding.
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|
| 2.8.5 No New Options. At the Effective Time, the Grand Premier Option Plans shall
be terminated with respect to the granting of any additional options or option rights.
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| 2.8.6 No Cash Surrender. In no event and at no time shall Grand Premier (including
its board of directors or any committee thereof): (a) permit or allow the holder of any
outstanding Unexercised Options pursuant to the Grand Premier Option Plans to receive cash
in exchange for the cancellation of any Unexercised Option; or (b) exercise any right of first
refusal granted to it under the Grand Premier Option Plans to purchase Grand Premier
Common Stock.
2.9 Approval of Grand Premier Series C Preferred Stock. If, notwithstanding any agreement
between Old Kent and a holder of shares of Grand Premier Series C Preferred Stock, the holders of
a majority of shares of Grand Premier Series C Preferred Stock duly approve the right to the cash
payment set forth in Section 4.3.5 of Grand Premier's amended and restated certificate of incorporation, then Grand Premier shall promptly notify Old Kent of such action and Old Kent shall have the
right to terminate this Plan of Merger for a period of 20 Business Days after Old Kent receives written
notice of such approval.
Article III - Old Kent's Representations and Warranties
Old Kent represents and warrants to Grand Premier that, except as otherwise set forth in the
disclosure statement previously furnished to Grand Premier by Old Kent (the "Old Kent Disclosure
Statement"):
3.1 Authorization, No Conflicts, Etc.
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| 3.1.1 Authorization of Agreement. Each of Old Kent and MergerSub has the requisite
corporate power and authority to execute and deliver this Plan of Merger and to consummate
the Merger. This Plan of Merger has been duly approved and adopted and the consummation
of the Merger has been duly authorized by the boards of directors of Old Kent and MergerSub
and the sole shareholder of MergerSub and no other corporate proceedings on the part of Old
Kent or MergerSub are necessary to authorize this Plan of Merger or to consummate the
Merger. This Plan of Merger has been duly executed and delivered by, and constitutes valid
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| and binding obligations of, Old Kent and MergerSub and is enforceable against Old Kent and
MergerSub in accordance with its terms.
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|
| 3.1.2 No Conflict, Breach, Violation, Etc. The execution, delivery, and performance
of this Plan of Merger by Old Kent and MergerSub, and the consummation of the Merger by
Old Kent and MergerSub, do not and will not violate, conflict with, or result in a breach of: (a)
any provision of the articles of incorporation of Old Kent (as amended and restated) or
MergerSub or the bylaws of Old Kent or MergerSub; or (b) any statute, code, ordinance, rule,
regulation, judgment, order, writ, memorandum of understanding, arbitral award, decree, or
injunction applicable to Old Kent or its subsidiaries, assuming the timely receipt of each of the
approvals referred to in Section 3.1.4 (Required Approvals).
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|
| 3.1.3 Regulatory Restrictions. The execution, delivery, and performance of this Plan
of Merger by Old Kent and MergerSub, and the consummation of the Merger by Old Kent and
MergerSub, do not and will not violate, conflict with, result in a breach of, constitute a default
under, or require any consent, approval, waiver, extension, amendment, authorization, notice,
or filing under, any memorandum of understanding or similar regulatory consent agreement to
which Old Kent is a party or subject, or by which it is bound or affected.
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|
| 3.1.4 Required Approvals. No notice to, filing with, authorization of, exemption by,
or consent or approval of, any public body or authority is necessary for the consummation of
the Merger by Old Kent and MergerSub other than in connection or compliance with the
provisions of the Michigan Act and the DGCL, compliance with federal and state securities
laws, bylaws and rules of the NYSE, and the approvals required under the Bank Holding
Company Act of 1956, as amended (the "Federal Bank Holding Company Act"), the Federal
Deposit Insurance Act, as amended (the "FDIA"), the Michigan Banking Code, and the
National Bank Act.
3.2 Organization and Good Standing. Each of Old Kent and MergerSub is a corporation duly
organized, validly existing, and in good standing under the laws of the State of Michigan. Old Kent
possesses all requisite corporate power and authority to own, operate, and lease its properties and to
carry on its business as it is now being conducted in all material respects. Old Kent is a bank holding
company duly registered as such with the Board of Governors of the Federal Reserve System (the
"Federal Reserve Board") under the Federal Bank Holding Company Act. Old Kent is qualified or
admitted to conduct business as a foreign corporation in each state in which the failure to be so
qualified or admitted is reasonably likely to have a Material Adverse Effect on Old Kent.
3.3 Subsidiaries. Old Kent owns all of the issued and outstanding shares of capital stock of
Old Kent Bank and MergerSub free and clear of all claims, security interests, pledges, or liens of any
kind. Old Kent Bank is duly organized, validly existing, and in good standing as a banking corporation
under the laws of the State of Michigan.
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3.4 Capital Stock.
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| 3.4.1 Classes and Shares--Old Kent. The authorized capital stock of Old Kent consists
of 325,000,000 shares divided into two classes as follows: (a) 300,000,000 shares of Old Kent
Common Stock, of which, as of September 3, 1999, a total of 118,216,968 shares were validly
issued and outstanding; and (b) 25,000,000 shares of preferred stock, without par value, of
which 3,000,000 shares are designated Series A Preferred Stock, 500,000 shares are designated
Series B Preferred Stock, and 1,000,000 shares are designated Series C Preferred Stock, none
of which preferred stock was issued and outstanding as of the date of this Plan of Merger. The
1,000,000 shares of Series C Preferred Stock are reserved for issuance pursuant to Series C
Preferred Stock Purchase Rights (the "Old Kent Rights") governed by a Rights Agreement,
dated as of January 20, 1997, as amended, between Old Kent and Old Kent Bank (the "Old
Kent Rights Agreement").
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|
| 3.4.2 No Other Capital Stock. As of the date of the Plan of Merger: (a) other than
Old Kent Common Stock, there is no security or class of securities issued and outstanding that
represents or is convertible into capital stock of Old Kent; and (b) there is no outstanding
subscription, option, warrant, or right to acquire any capital stock of Old Kent, or agreement
to which Old Kent is a party or by which it is bound to issue capital stock, except as set forth
in, or as contemplated by, this Plan of Merger, and except (i) the Old Kent Rights (which as
of the date of this Plan of Merger were represented by and transferable only with shares of Old
Kent Common Stock); (ii) stock options awarded pursuant to Old Kent employee and director
stock option plans; (iii) provisions for the grant or sale of shares or the right to receive shares
to, or for the account of, employees and directors pursuant to restricted stock, deferred stock
compensation, stock purchase and other benefit plans; (iv) shares of Old Kent Common Stock
issuable under agreements entered into in connection with mergers or acquisitions of direct or
indirect subsidiaries or assets in transactions approved by the Old Kent board of directors or
a committee of such board, all of which have been previously disclosed in Old Kent's filings
with the Securities and Exchange Commission (the "SEC"); and (v) shares of Old Kent
Common Stock issuable under Old Kent's DRIP and employee stock purchase plans.
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|
| 3.4.3 Issuance of Shares. Between September 3, 1999, and the date of this Plan of
Merger, no additional shares of capital stock have been issued or authorized for issuance by
Old Kent, except as described in this Plan of Merger, and except for shares issued or issuable
pursuant to (a) the exercise of employee stock options under employee stock option plans; (b)
the grant or sale of shares to, or for the account of, employees and directors pursuant to
restricted stock, deferred stock compensation, stock purchase or other benefit plans; and (c)
Old Kent's DRIP and employee stock purchase plans.
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|
| 3.4.4 Voting Rights. Neither Old Kent nor any of its subsidiaries (other than
MergerSub) has outstanding any security or issue of securities the holder or holders of which
have the right to vote on the approval of the Merger or this Plan of Merger, or that entitle the
holder or holders to consent to, or withhold consent on, the Merger or this Plan of Merger.
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| 3.4.5 Classes and Shares - MergerSub. The authorized capital stock of MergerSub
consists of 60,000 shares of common stock, without par value, of which, as of the date of this
Plan of Merger, a total of 1,000 shares were validly issued and outstanding.
3.5 Old Kent Capital Stock. The shares of Old Kent Capital Stock to be issued in the Merger
in accordance with this Plan of Merger have been duly authorized and reserved and, when issued as
contemplated by this Plan of Merger, will be validly issued, fully paid, and nonassessable shares.
3.6 Financial Statements.
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| 3.6.1 Financial Statements. The consolidated financial statements of Old Kent and its
subsidiaries as of and for each of the three years ended December 31, 1996, 1997, and 1998,
as reported on by Old Kent's independent accountants, and the unaudited consolidated financial
statements of Old Kent and its subsidiaries as of and for the quarters ended March 31, 1999 and
June 30, 1999, including all schedules and notes relating to such statements (collectively, "Old
Kent's Financial Statements"), fairly present, and the unaudited consolidated financial
statements of Old Kent and its subsidiaries as of and for each quarter ending after the date of
this Plan of Merger until the Effective Time, including all schedules and notes relating to such
statements, will fairly present, the financial condition and the results of operations, changes in
shareholders' equity, and cash flows of Old Kent as of the respective dates of and for the
periods referred to in such financial statements, all in accordance with generally accepted
United States accounting principles ("GAAP") consistently applied, subject, in the case of
unaudited interim financial statements, to normal, recurring year-end adjustments (the effect
of which would not, individually or in the aggregate, have a Material Adverse Effect on Old
Kent) and the absence of notes (that, if presented, would not differ materially from those
included in Old Kent's Financial Statements).
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|
| 3.6.2 Call Reports. The following reports (including all related schedules, notes, and
exhibits) were prepared and filed in conformity with applicable regulatory requirements and
were correct and complete in all material respects when filed:
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| (a) The consolidated reports of condition and income of Old Kent Bank
(including any amendments) as of and for each of the years ended December 31, 1996,
1997, and 1998, as filed with the Federal Deposit Insurance Corporation ("FDIC"); and
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|
| (b) The FR Y-9 and FR Y-6 (including amendments) for Old Kent as of and
for each of the years ended December 31, 1996, 1997, and 1998, as filed with the
Federal Reserve Board.
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| All of such reports required to be filed prior to the Closing by Old Kent and/or Old Kent Bank
will be prepared and filed in conformity with applicable regulatory requirements applied
consistently throughout their respective periods (except as otherwise noted in such reports) and
will be correct and complete in all material respects when filed.
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3.7 Absence of Undisclosed Liabilities. Except as and to the extent reflected or reserved
against in Old Kent's Financial Statements as of December 31, 1998, as of such date, neither Old Kent
nor any of its subsidiaries had liabilities or obligations, secured or unsecured (whether accrued,
absolute, or contingent) as to which there is a reasonable probability that they could have a Material
Adverse Effect on Old Kent.
3.8 Absence of Material Adverse Change. Since December 31, 1998, there has been no
change in the financial condition, income, expenses, assets, liabilities or business of Old Kent and its
subsidiaries that had or in the future is reasonably likely to have a Material Adverse Effect on Old Kent,
other than such changes that are caused by events and circumstances generally affecting the banking
industry as a whole. No facts or circumstances have been discovered from which it reasonably appears
that there is a reasonable probability that there will occur a change that is reasonably likely to have a
Material Adverse Effect on Old Kent, other than such changes that are caused by events and
circumstances generally affecting the banking industry as a whole.
3.9 Absence of Litigation. Except to the extent disclosed in Old Kent's filings with the SEC,
there is no action, suit, proceeding, claim, arbitration, or investigation pending or, to Old Kent's
knowledge, threatened by any person, including without limitation any governmental or regulatory
agency, against Old Kent or any of its subsidiaries, or the assets or business of Old Kent or any of its
subsidiaries, any of which has had or is reasonably likely to have a Material Adverse Effect on Old
Kent. To the knowledge of Old Kent, there is no factual basis that presents a reasonable potential for
any such action, suit, proceeding, claim, arbitration, or investigation.
3.10 Conduct of Business. Old Kent and each of Old Kent's subsidiaries have conducted their
respective businesses and used their respective properties in substantial compliance with all federal,
state, and local laws, civil or common, ordinances and regulations, including without limitation
applicable federal and state laws and regulations concerning banking, securities, truth-in-lending, truth-in-savings, mortgage origination and servicing, usury, fair credit reporting, consumer protection,
occupational safety, civil rights, employee protection, fair employment practices, fair labor standards,
insurance, and Environmental Laws (as defined in Section 4.24.2 (Environmental Laws)), except for
such violations that, individually or in the aggregate, would not have a Material Adverse Effect on Old
Kent.
3.11 Material Contracts. Neither Old Kent nor any of its subsidiaries is a party to any
agreement, contract, loan, mortgage, deed of trust, lease, commitment, indenture, note, or other instrument under which (a) a consent or approval is required, (b) a prohibited assignment by operation of
law could occur, (c) a waiver or loss of any right could occur or (d) acceleration of any obligation
could occur, in each case as a result of the execution and delivery of this Plan of Merger or the
performance of the transactions contemplated by this Plan of Merger, where (w) the failure to obtain
such consent or approval, (x) the violation of the prohibition against assignment, (y) the waiver or loss
of any right, or (z) the acceleration of any obligation would have a Material Adverse Effect on Old
Kent.
3.12 Regulatory Filings. In the last three years:
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| 3.12.1 SEC Filings. Old Kent has filed, and will in the future continue to file, in a
timely manner all required filings with the SEC, including without limitation all reports on
Form 10-K and Form 10-Q;
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|
| 3.12.2 Regulatory Filings. Old Kent has filed in a timely manner all other material
filings with other regulatory bodies for which filings are required; and
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|
| 3.12.3 Complete and Accurate. All such filings, as of their respective filing dates, did
not contain any untrue statement of material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading.
3.13 Registration Statement, Etc.
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| 3.13.1 "Transaction Documents." The term "Transaction Documents" shall
collectively mean: (i) the registration statement to be filed by Old Kent with the SEC (the
"Registration Statement") in connection with the Old Kent Common Stock to be issued in the
Merger; (ii) the prospectus and proxy statement (the "Prospectus and Proxy Statement") to
be mailed to Grand Premier stockholders in connection with the Stockholders' Meeting (defined
below); and (iii) any other documents to be filed with the SEC, the Federal Reserve Board, the
Michigan Financial Institutions Bureau ("FIB"), the Comptroller of the Currency ("OCC"), the
states of Michigan or Delaware, or any other regulatory agency in connection with the Merger.
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|
| 3.13.2 Accurate Information. The information to be supplied by Old Kent for inclusion
or incorporation by reference in any Transaction Document will not contain any untrue
statement of material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under which they were
made, not misleading (a) at the respective times such Transaction Documents are filed; (b) with
respect to the Registration Statement, when it becomes effective; and (c) with respect to the
Prospectus and Proxy Statement, when it is mailed and at the time of the Stockholders'
Meeting.
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|
| 3.13.3 Compliance of Filings. All documents that Old Kent is responsible for filing
with the SEC or any regulatory agency in connection with the Merger will comply as to form
in all material respects with the provisions of applicable law and regulation.
3.14 Investment Bankers and Brokers. Old Kent has not employed any broker, finder, or
investment banker in connection with the Merger. Old Kent has no express or implied agreement with
any other person or company relative to any commission or finder's fee payable with respect to this
Plan of Merger or the transactions contemplated by it.
3.15 Accounting and Tax Treatment. Neither Old Kent nor, to its knowledge, any of its
affiliates, has taken or agreed to take any action or knows of any reason that, with respect to Old Kent
and its affiliates, would prevent Old Kent from accounting for the business combination to be effected
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by the Merger as a pooling-of-interests. Old Kent has no knowledge of any reason why the Merger
would fail to qualify as a reorganization under Section 368(a) of the Internal Revenue Code.
3.16 Agreements With Bank Regulators. Neither Old Kent nor any of Old Kent's subsidiaries
is a party to any agreement or memorandum of understanding with, or a party to any commitment
letter, board resolution or similar undertaking to, or is subject to any order or directive by, or is a
recipient of any extraordinary supervisory letter from, any governmental authority that restricts
materially the conduct of its business, or in any manner relates to its capital adequacy, its credit or
reserve policies or its management, nor has Old Kent been advised by any governmental authority that
it is contemplating issuing or requesting (or is considering the appropriateness of issuing or requesting)
any such order, decree, agreement, memorandum of understanding, extraordinary supervisory letter,
commitment letter or similar submission. As of the date of this Plan of Merger, Old Kent knows of no
reason why the regulatory approvals referred to in Sections 3.1.4 and 4.1.4 (Required Approvals)
cannot be obtained or why the process would be materially impeded.
3.17 Reserve for Loan Losses. The reserve for credit losses as reflected in Old Kent's Financial
Statements as of December 31, 1998 was (a) adequate in the reasonable opinion of management to
meet all reasonably anticipated credit losses, net of recoveries related to assets previously charged off
as of that date, and (b) consistent with GAAP and safe and sound banking practices.
3.18 Year 2000 Compliance. Old Kent has adopted and is implementing plans and procedures
consistent with applicable regulatory requirements and guidelines and good business practices so that
its Year 2000 Assets (defined below) are and will be timely modified, upgraded or replaced to become
Year 2000 Ready (defined below) in all material respects by September 30, 1999.
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| 3.18.1 Compliance Costs. The remaining cost and process of achieving Year 2000
readiness for any Year 2000 Assets that are not Year 2000 Ready do not, and will not,
constitute a Material Adverse Effect with respect to Old Kent.
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| 3.18.2 Regulatory Compliance. Old Kent and its banking subsidiaries are in material
compliance with the requirements, guidelines, and schedule contained in the Federal Financial
Institutions Examination Council's statements dated May 5, 1997, "Year 2000 Project
Management Awareness," and December 17, 1997, "Safety and Soundness Guidelines
Concerning the Year 2000 Business Risk," and dated October 15, 1998, "Interagency
Guidelines Establishing Year 2000 Standards for Safety and Soundness," to the extent
applicable. Neither Old Kent nor its subsidiaries have received any Year 2000 deficiency
notification letter from any regulator having jurisdiction pertaining to Year 2000 readiness.
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| 3.18.3 Compatibility. Old Kent makes no representation relating to the compatibility
of the technology used by Old Kent or any of its subsidiaries with that used by Grand Premier
or with respect to the cost of integrating the technology of Grand Premier or any of its
subsidiaries with that used by Old Kent.
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|
| 3.18.4 Definitions. "Year 2000 Assets" means all buildings, physical plants, structures, machinery, equipment, software, hardware, computer
systems and other property owned,
- 18 -
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| leased, licensed or used by either Old Kent or Grand Premier, as applicable, or their respective
subsidiaries, which individually or taken together, are material to the ordinary conduct of their
respective lines of business, services, or operations. "Year 2000 Ready" means that the Year
2000 Asset accurately processes and handles date and time data, including but not limited to
performing all leap year calculations and calculating, comparing and sequencing during and
between the years 1999 and 2000 and all other years, and will not malfunction, cease to
function or provide invalid or incorrect results or data as a result of date or time data, including
when a Year 2000 Asset is used in combination with or is interfacing with any other Year 2000
Asset or with any other asset or information technology to the extent that it is within its
control.
Article IV - Grand Premier's Representations and Warranties
Grand Premier represents and warrants to Old Kent that, except as otherwise set forth in the
disclosure statement previously furnished to Old Kent by Grand Premier (the "Grand Premier
Disclosure Statement"):
4.1 Authorization, No Conflicts, Etc.
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| 4.1.1 Authorization of Agreement. Grand Premier has the requisite corporate power
and authority to execute and deliver this Plan of Merger and, subject to adoption by Grand
Premier's stockholders, to consummate the Merger. This Plan of Merger has been duly
adopted and the consummation of the Merger have been duly authorized by the board of
directors of Grand Premier and no other corporate proceedings on the part of Grand Premier
are necessary to authorize this Plan of Merger or to consummate the Merger, subject only to
adoption by the holders of Grand Premier Common Stock. This Plan of Merger has been duly
executed and delivered by, and constitutes valid and binding obligations of, Grand Premier and
is enforceable against Grand Premier in accordance with its terms.
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|
| 4.1.2 No Conflict, Breach, Violation, Etc. The execution, delivery, and performance
of this Plan of Merger by Grand Premier and a certain voting agreement, dated as of the same
date as this Plan of Merger, among Old Kent and certain stockholders of Grand Premier (the
"Voting Agreement") by such stockholders, and the consummation of the Merger, do not and
will not violate, conflict with, or result in a breach of any provision of: (a) Grand Premier's
amended and restated certificate of incorporation or by-laws or any of Grand Premier's
subsidiaries' certificate of incorporation, articles of association, by-laws, or similar organizational documents; or (b) any statute, code, ordinance, rule, regulation, judgment, order, writ,
memorandum of understanding, arbitral award, decree, or injunction applicable to Grand
Premier or any of its subsidiaries, assuming the timely receipt of each of the approvals referred
to in Section 4.1.4 (Required Approvals). The board of directors of Grand Premier has
approved the transactions contemplated by this Plan of Merger, the Voting Agreement, and the
Option Agreement such that provisions of Section 203 of the DGCL will not apply to this Plan
of Merger, the Voting Agreement, or the Option Agreement or any of the transactions
contemplated hereby or thereby.
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|
| 4.1.3 Regulatory Restrictions. The execution, delivery, and performance of this Plan
of Merger by Grand Premier and the Voting Agreement by the Stockholders, and the
consummation of the Merger, do not and will not violate, conflict with, result in a breach of,
constitute a default under, or require any consent, approval, waiver, extension, amendment,
authorization, notice, or filing under, any memorandum of understanding or similar regulatory
consent agreement to which Grand Premier or any of its subsidiaries is a party or subject, or
by which it is bound or affected.
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|
| 4.1.4 Required Approvals. No notice to, filing with, authorization of, exemption by,
or consent or approval of, any public body or authority is necessary for the consummation of
the Merger by Grand Premier other than in connection or compliance with the provisions of
the Michigan Act and DGCL, compliance with federal and state securities laws, and the
consents, authorizations, approvals, or exemptions required under the Federal Bank Holding
Company Act, the FDIA, and the Michigan Banking Code.
4.2 Organization and Good Standing. Grand Premier is a corporation duly organized, validly
existing, and in good standing under the laws of the State of Delaware. Grand Premier possesses all
requisite corporate power and authority to own, operate, and lease its properties and to carry on its
business as it is now being conducted in all material respects. Grand Premier is a bank holding
company duly registered as such with the Federal Reserve Board under the Federal Bank Holding
Company Act. Grand Premier is duly qualified and in good standing as a foreign corporation in the
State of Illinois. Grand Premier is not, and is not required to be, qualified or admitted to conduct
business as a foreign corporation in any other state, except where the failure to be so qualified or
admitted would not have a Material Adverse Effect on Grand Premier.
4.3 Subsidiaries.
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| 4.3.1 Ownership. Grand Premier owns all of the issued and outstanding shares of
capital stock of each of its subsidiaries, free and clear of any claim, security interest, pledge,
or lien of any kind. Each of Grand Premier Bank and Grand Premier Trust Bank is duly
organized, validly existing, and in good standing as a national banking association under the
laws of the United States of America. Each of Grand Premier's other subsidiaries (as listed in
the Grand Premier Disclosure Statement) is duly incorporated or formed as a limited liability
company, validly existing, and in good standing in its state of incorporation or formation.
Grand Premier does not have "Control" (as defined in Section 2(a)(2) of the Federal Bank
Holding Company Act, using 5 percent rather than 25 percent), either directly or indirectly, of
any corporation, general or limited partnership, limited liability company, trust or other person
engaged in an active trade or business or that holds any significant assets other than as
disclosed in the Grand Premier Disclosure Statement.
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|
| 4.3.2 Rights to Capital Stock. There is no legally binding and enforceable subscription,
option, warrant, right to acquire, or any other similar agreement relating to the acquisition of
any of the capital stock of any of Grand Premier's subsidiaries.
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|
| 4.3.3 Qualification and Power. Each of Grand Premier's subsidiaries is qualified or
admitted to conduct business in each state where such qualification or admission is required
except those states where the failure to be so qualified or admitted would not have a Material
Adverse Effect on Grand Premier. Each of Grand Premier's subsidiaries has full corporate
power and authority to carry on its business as and where now being conducted.
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|
| 4.3.4 Deposit Insurance; Other Assessments. Each of the Grand Premier Banks
maintains in full force and effect deposit insurance through the Bank Insurance Fund of the
FDIC. Neither of the Grand Premier Banks nor their predecessors have previously
consummated a deposit insurance conversion transaction or a so-called "Oakar" deposit
insurance transaction involving a depository institution whose deposits were insured through
the Savings Association Insurance Fund. Each of the Grand Premier Banks has fully paid to
the FDIC as and when due all assessments with respect to its deposits as are required to
maintain such deposit insurance in full force and effect. Each of the Grand Premier Banks has
paid as and when due all material fees, charges, and assessments to each and every governmental or regulatory agency having jurisdiction as required by law, regulation, or rule.
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|
| 4.3.5 No Acquisition or Merger Restrictions. Each of the Grand Premier Banks
qualifies under the Illinois banking laws and regulations to be acquired by an out of state bank
holding company, and, immediately thereafter, to be merged or consolidated with and into an
out of state bank.
4.4 Capital Stock.
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| 4.4.1 Classes and Shares. The authorized capital stock of Grand Premier consists of
32,000,000 shares divided into two classes as follows: (a) 30,000,000 shares of common stock,
$0.01 par value per share, of which, as of the date of this Plan of Merger, a total of 22,359,791
shares were validly issued and outstanding, no shares were held as treasury shares, and 357,406
shares were subject to outstanding options as of the date of this Plan of Merger; and (b)
2,000,000 shares of preferred stock, $0.01 par value per share, of which (i) 7,250 shares were
designated and are issued and outstanding as Grand Premier Series B Preferred Stock, (ii)
2,000 shares were designated and are issued and outstanding as Grand Premier Series C
Preferred Stock, and (iii) 300,000 shares were designated Series I Junior Participating Preferred
Stock, none of which were issued and outstanding as of the date of this Plan of Merger. All
dividends payable to the holders of Grand Premier Preferred Stock have been paid in full. Each
share of Grand Premier Series B Preferred Stock is convertible into 129.22 shares of Grand
Premier Common Stock. The 300,000 shares of Series I Junior Participating Preferred Stock
are reserved for issuance pursuant to the exercise of preferred stock purchase rights (the
"Grand Premier Rights") governed by a Rights Agreement, dated as of July 8, 1996, between
Grand Premier and Grand Premier Trust Bank (the "Grand Premier Rights Agreement").
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|
| 4.4.2 No Other Capital Stock. Except for the Option Agreement, the Grand Premier
Rights Agreement, the Grand Premier Series B Preferred Stock, and the outstanding options
under the Grand Premier Option Plans, there is no security or class of securities authorized or
issued that represents or is convertible into Grand Premier Capital Stock. Except for the
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|
| Option Agreement, the outstanding options under the Grand Premier Option Plans, the Grand
Premier Rights Agreement, and Grand Premier Savings and Stock Plan (the "Grand Premier
Savings Plan") and the Grand Premier Deferred Compensation Plan, there is no outstanding
subscription, option, warrant, right, or agreement to acquire Grand Premier Capital Stock, or
agreements to which Grand Premier is a party or by which it may be or is bound to issue Grand
Premier Capital Stock. No stock option agreement issued under the Grand Premier Option
Plans requires or permits the payout of cash in exchange for the cancellation of such
Unexercised Option.
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|
| 4.4.3 Issuance of Shares. After the date of this Plan of Merger, the number of issued
and outstanding shares of Grand Premier Common Stock is not subject to change before the
Effective Time except for Permitted Issuances, issuances, if any, through the Grand Premier
Savings Plan, and issuances under the Option Agreement.
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|
| 4.4.4 Voting Rights. Other than the shares of Grand Premier Common Stock described
in this Section, neither Grand Premier nor any of Grand Premier's subsidiaries has outstanding
any security or issue of securities the holder or holders of which have the right to vote on the
approval of the Merger or this Plan of Merger or that entitle the holder or holders to consent
to, or withhold consent on, the Merger or this Plan of Merger.
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|
| 4.4.5 Appraisal Rights. No holder of Grand Premier Common Stock will be entitled
to appraisal rights pursuant to Section 262 of DGCL as a result of the consummation of the
Merger. The holders of Grand Premier Preferred Stock will be entitled to appraisal rights
pursuant to Section 262 of DGCL as a result of the consummation of the Merger.
4.5 Amendment of Grand Premier Rights. Grand Premier has duly amended the Grand Premier
Rights Agreement to exempt the Merger, the transactions contemplated by the Voting Agreement, and
the award and exercise of the Option contemplated by the Option Agreement and prevent such events
from constituting a "Flip-In Event" under the Grand Premier Rights Agreement or otherwise triggering
any other provision under the Grand Premier Rights Agreement and prevent Old Kent from becoming
"Acquiring Persons" under such agreement. The Grand Premier Rights issued to the holders of Grand
Premier Common Stock that are evidenced, as of the date of this Plan of Merger, by shares of Grand
Premier Common Stock may be redeemed by Grand Premier upon a resolution therefor by the Board
of Directors of Grand Premier at a redemption price of no more than $0.01 per Grand Premier Right
in cash. Neither the execution of this Plan of Merger by Grand Premier nor any of the provisions of
this Plan of Merger, the Voting Agreement, or the Option Agreement will adversely affect in any way
the ability of Grand Premier to redeem the Grand Premier Rights as described in this Section 4.5
(Redemption of Grand Premier Rights).
4.6 Financial Statements.
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| 4.6.1 Financial Statements. The consolidated financial statements of Grand Premier
as of and for the each of three years ended December 31, 1996, 1997, and 1998, as reported
on by Grand Premier's independent accountants, and the unaudited consolidated financial
statements of Grand Premier and its subsidiaries as of and for the quarters ended March 31,
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| 1999 and June 30, 1999, including all schedules and notes relating to such statements, as
previously delivered to Old Kent (collectively, "Grand Premier's Financial Statements"),
fairly present, and the unaudited consolidated financial statements of Grand Premier and its
subsidiaries as of and for each quarter ending after the date of this Plan of Merger until the
Effective Time, including all schedules and notes relating to such statements, will fairly present,
the financial condition and the results of operations, changes in stockholders' equity, and cash
flows of Grand Premier as of the respective dates of and for the periods referred to in such
financial statements, all in accordance with GAAP, consistently applied, subject, in the case of
unaudited interim financial statements, to normal, recurring year-end adjustments (the effect
of which would not, individually or in the aggregate, have a Material Adverse Effect on Grand
Premier) and the absence of notes (that, if presented, would not differ materially from those
included in Grand Premier's Financial Statements). No financial statements of any entity or
enterprise other than those subsidiaries of Grand Premier set forth in Schedule 4.3 of the Grand
Premier Disclosure Statement are required by GAAP to be included in the consolidated
financial statements of Grand Premier.
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|
| 4.6.2 Call Reports. The following reports (including all related schedules, notes, and
exhibits) were prepared and filed in conformity with applicable regulatory requirements and
were correct and complete in all material respects when filed:
|
| (a) The consolidated reports of condition and income of each of the Grand
Premier Banks (including any amendments) as of and for each of the years ended
December 31, 1996, 1997, and 1998, as filed with the FDIC; and
|
|
| (b) The FR Y-9 and FR Y-6 (including any amendments) for Grand Premier
as of and for each of the years ended December 31, 1996, 1997, and 1998, as filed with
the Federal Reserve Board.
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| All of such reports required to be filed prior to the Closing by Grand Premier and/or Grand
Premier Banks will be prepared and filed in conformity with applicable regulatory requirements
applied consistently throughout their respective periods (except as otherwise noted in such
reports) and will be correct and complete in all material respects when filed. All of the reports
identified in this Section are collectively referred to as the "Call Reports."
4.7 Absence of Undisclosed Liabilities. Except as and to the extent reflected or reserved
against in Grand Premier's Financial Statements as of December 31, 1998, neither Grand Premier nor
any of Grand Premier's subsidiaries had, as of such date, liabilities or obligations, secured or unsecured
(whether accrued, absolute, or contingent) as to which there is a reasonable probability that they could
have a Material Adverse Effect on Grand Premier.
4.8 Absence of Material Adverse Change. Since December 31, 1998, there has been no
change in the financial condition, income, expenses, assets, liabilities or business of Grand Premier that
had or in the future is reasonably likely to have a Material Adverse Effect on Grand Premier, other than
such changes that are caused by events and circumstances generally affecting the banking industry as
a whole. No facts or circumstances have been discovered from which it reasonably appears that there
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is a reasonable probability that there will occur a change that is reasonably likely to have a Material
Adverse Effect on Grand Premier, other than such changes that are caused by events and circumstances
generally affecting the banking industry as a whole.
4.9 Absence of Litigation. There is no action, suit, proceeding, claim, arbitration, or
investigation pending or, to the knowledge of Grand Premier, threatened by any person, including
without limitation any governmental or regulatory agency, against Grand Premier or any of its
subsidiaries, or the assets or business of Grand Premier or any of its subsidiaries, any of which has had
or is reasonably likely to have a Material Adverse Effect on Grand Premier. To the knowledge of
Grand Premier, there is no factual basis that presents a reasonable potential for any such action, suit,
proceeding, claim, arbitration, or investigation.
4.10 No Indemnification Claims. To the knowledge of Grand Premier, there has been no
event, action, or omission by or with respect to any director, officer, employee, trustee, agent, or other
person who may be entitled to receive indemnification or reimbursement of any claim, loss, or expense
under any agreement, contract, or arrangement providing for corporate indemnification or
reimbursement of any such person.
4.11 Conduct of Business. Grand Premier and each of Grand Premier's subsidiaries have
conducted their respective businesses and used their respective properties in substantial compliance
with all federal, state, and local laws, civil or common, ordinances and regulations, including without
limitation applicable federal and state laws and regulations concerning banking, securities, truth-in-lending, truth-in-savings, mortgage origination and servicing, usury, fair credit reporting, consumer
protection, occupational safety, civil rights, employee protection, fair employment practices, fair labor
standards, and insurance, and Environmental Laws (as defined in Section 4.24.2 (Environmental
Laws)), except for such violations that, individually or in the aggregate, would not have a Material
Adverse Effect on Grand Premier.
4.12 Contracts. There is no existing default by Grand Premier or any of its subsidiaries or, to
the knowledge of Grand Premier, any other party under any contract or agreement to which Grand
Premier or any of its subsidiaries is a party, or by which they are bound, the result of which is
reasonably likely to have a Material Adverse Effect on Grand Premier. Excepting any ordinary and
customary banking relationships, there is no material agreement, contract, mortgage, deed of trust,
lease, commitment, indenture, note, or other instrument of which Grand Premier has knowledge under
which another party is in material default of its obligations to Grand Premier or any of its subsidiaries.
Grand Premier is not party to any contract, agreement, arrangement, or understanding (other than
ordinary and customary banking relationships) that would require Grand Premier or any of its
subsidiaries to make payments or make expenditures in excess of $200,000 per year or that would
require any payment to another party upon termination of the agreement, arrangement, or
understanding in excess of $50,000.
4.13 Regulatory Filings. In the last three years:
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|
| 4.13.1 SEC Filings. Grand Premier has filed, and in the future will continue to file,
in a timely manner all required filings with the SEC, including without limitation all reports on
Form 10-K and Form 10-Q;
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|
| 4.13.2 Regulatory Filings. Grand Premier has filed in a timely manner all other filings
with other regulatory bodies for which filings are required; and
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|
| 4.13.3 Complete and Accurate. All such filings, as of their respective filing dates, did
not contain any untrue statement of material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading. All such filings complied in all material respects with
all laws, regulations, forms, and guidelines applicable to such filings.
4.14 Registration Statement, Etc.
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| 4.14.1 Accurate Information. The information to be supplied by Grand Premier for
inclusion or incorporation by reference in any Transaction Document will not contain any
untrue statement of material fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under which they
were made, not misleading (a) at the respective times such Transaction Documents are filed;
(b) with respect to the Registration Statement, when it becomes effective; and (c) with respect
to the Prospectus and Proxy Statement, when it is mailed and at the time of the Stockholders'
Meeting.
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|
| 4.14.2 Compliance of Filings. All documents that Grand Premier is responsible for
filing with the SEC or any regulatory agency in connection with the Merger will comply as to
form in all material respects with the provisions of applicable law and regulation.
4.15 Agreements With Bank Regulators. Neither Grand Premier nor any of Grand Premier's
subsidiaries is a party to any agreement or memorandum of understanding with, or a party to any
commitment letter, board resolution or similar undertaking to, or is subject to any order or directive
by, or is a recipient of any extraordinary supervisory letter from, any governmental authority that
restricts materially the conduct of its business, or in any manner relates to its capital adequacy, its credit
or reserve policies or its management, nor has Grand Premier been advised by any governmental
authority that it is contemplating issuing or requesting (or is considering the appropriateness of issuing
or requesting) any such order, decree, agreement, memorandum of understanding, extraordinary
supervisory letter, commitment letter or similar submission. As of the date of this Plan of Merger,
Grand Premier knows of no reason why the regulatory approvals referred to in Sections 3.1.4 and 4.1.4
(Required Approvals) cannot be obtained or why the process would be materially impeded.
4.16 Tax Matters.
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| 4.16.1 Taxes Defined. "Taxes" means any federal, state, county, local, or foreign
taxes, charges, assessments, levies, deficiencies, or other governmental fees, charges, or
amounts required to be collected, withheld, or paid to any government, agency, or political
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| subdivision of any government in respect to any tax or governmental fee or charge, together
with any penalties, additions to tax or interest, due under any applicable law, regulation, rule,
or ordinance to any governmental unit or agency, including, without limitation, taxes with
respect to income, profits, gross receipts, value added, ad valorem, employment, unemployment, withholding, backup withholding, nonresident alien withholding, social security, real
property, personal property, sales, use, excise, intangibles, license, franchise, capital stock, and
disability, and payments based on occupation, services rendered, real property, personal
property or transfer.
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| 4.16.2 Tax Returns. Grand Premier and its subsidiaries have each duly and timely filed
or delivered, and if necessary amended, all material tax returns, information returns, estimates,
declarations, reports, statements and other filings that are required by law, regulation, rule, or
ordinance (collectively, "Tax Returns"). Each such Tax Return, as amended, is materially
correct, and complete, and complies in all material respects with all applicable laws, regulations,
rules, and ordinances. Grand Premier and its subsidiaries have each maintained all necessary
and appropriate accounting records to support the positions taken on all filed Tax Returns and
all exemptions from filing Tax Returns.
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| 4.16.3 Tax Assessments and Payments. All material Taxes due and payable by Grand
Premier and each of Grand Premier's subsidiaries have been paid or deposited in full as and
when due, including applicable extension periods. Each of Grand Premier and Grand Premier's
subsidiaries have withheld and paid over all material Taxes required to have been withheld and
paid over, and complied with all information reporting and backup withholding requirements,
including maintenance of required records with respect thereto, in connection with amounts
paid or owing to any employee, creditor, independent contractor or other third parties. The
provisions made for Taxes on Grand Premier's Financial Statements as of December 31, 1998,
are sufficient for the payment of all accrued but unpaid Taxes as of the date indicated, whether
or not disputed, with respect to all periods through December 31, 1998. There is no lien on
any of Grand Premier's or any of its subsidiaries' assets or properties with respect to Taxes,
except for liens for Taxes not yet due and payable.
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|
| 4.16.4 Tax Audits. None of the Tax Returns of Grand Premier and its subsidiaries filed
for any tax year after 1989 have been audited by the Internal Revenue Service (the "IRS") or
any state or local taxing authority. There is no tax audit or legal or administrative proceeding
concerning the accuracy of tax or information returns or the assessment or collection of Taxes
pending or, to Grand Premier's knowledge, threatened with respect to Grand Premier or its
subsidiaries. No claim concerning the calculation, assessment or collection of taxes has been
asserted and not fully resolved with respect to Grand Premier or any of its subsidiaries. No
waiver or extension of any statute of limitations is in effect with respect to Taxes or Tax
Returns of Grand Premier or any of its subsidiaries.
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|
| 4.16.5 Tax Accounting. Neither Grand Premier nor any of its subsidiaries have been
required to include in income any adjustment pursuant to Section 481 of the Internal Revenue
Code by reason of a voluntary change in accounting method initiated by Grand Premier or any
of its subsidiaries, and the IRS has not initiated or proposed any such adjustment or change in
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| accounting method. Neither Grand Premier nor any of its subsidiaries has entered into a
transaction which is being accounted for as an installment obligation under Section 453 of the
Internal Revenue Code.
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| 4.16.6 Excess Parachute Payments. No compensation that could be payable (whether
in cash, stock, options, or other property or the vesting of property or other rights) by Grand
Premier, its subsidiaries, its affiliates, or any of their respective successors under any
employment, option, benefit plan, severance, termination or other compensation arrangement
currently in effect is, or will be, an "excess parachute payment" (as defined in Section 280G of
the Internal Revenue Code).
4.17 Title to Properties. Grand Premier and each of its subsidiaries have good, sufficient, and
marketable title to all of their properties and assets, whether real, personal, or a combination thereof,
reflected in their books and records as being owned (including those reflected in Grand Premier's
Financial Statements as of December 31, 1998, except as since disposed of in the ordinary course of
business), free and clear of all liens and encumbrances, except:
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| 4.17.1 Reflected on Balance Sheet. As reflected on Grand Premier's Financial
Statements as of December 31, 1998;
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| 4.17.2 Normal to Business. Liens for current Taxes not yet delinquent, and liens or
encumbrances that are normal to the business of Grand Premier and that would not have a
Material Adverse Effect on Grand Premier; and
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| 4.17.3 Immaterial Imperfections. Such imperfections of title, easements, restrictions,
and encumbrances, if any, as are not material in character, amount, or extent, and do not
materially detract from the value, or materially interfere with the present use, of the properties
subject thereto or affected thereby.
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| 4.17.4 Public Easements; Etc. Such public easements, public rights of way, and
interests of units of government of record, if any, as are not material in character, amount, or
extent, and do not materially detract from the value, or materially interfere with the present use,
of the properties subject thereto or affected thereby.
4.18 Condition of Real Property. With respect to each parcel of real property owned, legally
or beneficially, by Grand Premier or any of its subsidiaries, including other real estate owned ("Grand
Premier's Real Property"), to its knowledge:
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| 4.18.1 No Encroachments. Except for those encroachments that have been insured
over by a policy of title insurance, no building or improvement to Grand Premier's Real
Property encroaches on any easement or property owned by another person. No building or
property owned by another person encroaches on Grand Premier's Real Property or on any
easement benefitting Grand Premier's Real Property. None of the boundaries of Grand
Premier's Real Property deviates substantially from those shown on the survey of such
property, if any, included with the Grand Premier Disclosure Statement or from what the
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| boundaries appear to be through visual inspection. No claim of encroachment has been
asserted by any person with respect to any of Grand Premier's Real Property.
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| 4.18.2 Zoning. Neither Grand Premier, any of Grand Premier's subsidiaries, nor Grand
Premier's Real Property is in material violation of any zoning regulation, building restriction,
restrictive covenant, ordinance, or other law, order, regulation, or requirement relating to any
of Grand Premier's Real Property.
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| 4.18.3 Buildings. All buildings and improvements to Grand Premier's Real Property
are in good condition (normal wear and tear excepted), are structurally sound and are not in
need of material repairs, are fit for their intended purposes, and are adequately serviced by all
utilities necessary for the effective operation of business as presently conducted at that location.
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| 4.18.4 No Condemnation. None of Grand Premier's Real Property is the subject of
any condemnation action. There is no proposal under active consideration by any public or
governmental authority or entity to acquire Grand Premier's Real Property for any governmental purpose.
4.19 Real and Personal Property Leases. With respect to each lease and license pursuant to
which Grand Premier or any of its subsidiaries, as lessee or licensee, has possession of real or personal
property, excluding any personal property lease with aggregate payments of less than $25,000 per year
("Grand Premier's Leases"):
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| 4.19.1 Valid. Each of Grand Premier's Leases is valid, effective, and enforceable
against the lessor or licensor in accordance with its terms.
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| 4.19.2 No Default. There is no existing default under any of Grand Premier's Leases
or any event that with notice or passage of time, or both, would constitute a default with
respect to Grand Premier, any of Grand Premier's subsidiaries or, to the knowledge of Grand
Premier, any other party to the contract, which default is reasonably likely to have a Material
Adverse Effect on Grand Premier.
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| 4.19.3 Assignment. None of Grand Premier's Leases contain a prohibition against
assignment by Grand Premier or any of its subsidiaries, by operation of law or otherwise, or
any provision that would materially interfere with the possession, use, or rights with respect
to the property by Old Kent or its subsidiaries for the same purposes and upon the same rental
and other terms following consummation of the Merger as are applicable to Grand Premier or
Grand Premier's subsidiaries prior to the Effective Time.
4.20 Required Licenses, Permits, Etc.
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| 4.20.1 Licenses, Permits, Etc. Grand Premier and each of Grand Premier's subsidiaries
hold all licenses, certificates, permits, franchises, and rights from all appropriate federal, state,
and other public authorities necessary for the conduct of its business as presently conducted,
except where the lack of which would not have a Material Adverse Effect on Grand Premier.
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| 4.20.2 Regulatory Action. Neither Grand Premier nor any of its subsidiaries nor any
of their directors, officers, or employees has within the last five years been charged by a
regulatory authority with, or to Grand Premier's knowledge is under governmental investigation with respect to, any actual or alleged violation of any statute, ordinance, rule, regulation,
guideline, or standard applicable to Grand Premier or its subsidiaries' or their respective
businesses. Neither Grand Premier nor any of its subsidiaries nor any of their directors,
officers, or employees is the subject of any pending or, to Grand Premier's knowledge,
threatened proceeding by any regulatory authority having jurisdiction over the business,
properties, or operations of Grand Premier or any of its subsidiaries.
4.21 Material Contracts. There is no agreement, contract, loan, mortgage, deed of trust,
lease, commitment, indenture, note, or other instrument under which (a) a consent or approval is
required, (b) a prohibited assignment by operation of law could occur, (c) a waiver or loss of any right
could occur or (d) acceleration of any obligation could occur, in each case as a result of the execution
and delivery of this Plan of Merger, or a change of control, merger, consolidation, or liquidation of
Grand Premier or any of its subsidiaries upon consummation of the Merger where (w) the failure to
obtain such consent or approval, (x) the violation of the prohibition against assignment, (y) the waiver
or loss of any right, or (z) the acceleration of any obligation could materially interfere with the ordinary
course of business by Grand Premier or any of its subsidiaries (or Old Kent or any of its subsidiaries
as their successors) or have a Material Adverse Effect on Grand Premier. The execution and delivery
of this Plan of Merger by Grand Premier will not subject Old Kent or its subsidiaries to liability for
tortious interference with contractual rights.
4.22 Certain Employment Matters.
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| 4.22.1 Employment Policies, Programs, and Procedures. The policies, programs, and
practices of Grand Premier and each of its subsidiaries relating to equal opportunity and
affirmative action, wages, hours of work, employee disabilities, and other terms and conditions
of employment are in compliance in all material respects with applicable federal, state, and local
laws, orders, regulations, and ordinances governing or relating to employment and employer
practices and facilities.
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| 4.22.2 Record of Payments. There is no existing or outstanding obligation of Grand
Premier or any of its subsidiaries, whether arising by operation of law, civil or common, by
contract, or by past custom, for any Employment-Related Payment (as defined in Section 4.22.3 (Employment-Related Payments)) to any trust, fund, company, governmental agency, or any
person that has not been duly recorded on the books and records of Grand Premier and paid
when due or duly accrued in the ordinary course of business in accordance with GAAP.
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| 4.22.3 Employment-Related Payments. For purposes of this Plan of Merger,
"Employment-Related Payments" include any payment to be made with respect to any
contract for employment; unemployment compensation benefits; profit sharing, pension, or
retirement benefits; social security benefits; fringe benefits, including vacation, or holiday pay,
bonuses, and other forms of compensation; or for medical insurance or medical expenses; any
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