UNITED STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO
SECTION 13 OR 15(d) OF
THE SECURITIES
EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
January 5, 2016
CAPE BANCORP,
INC.
(Exact Name of Registrant as Specified in its
Charter)
Maryland |
001-33934 |
26-1294270 |
(State or Other Jurisdiction
of Incorporation) |
(Commission File No.) |
(I.R.S. Employer
Identification No.) |
225 North Main Street, Cape May Court House, New Jersey |
08210 |
(Address of Principal Executive Offices) |
(Zip Code) |
Registrant’s telephone number, including area code: (609)
465-5600
Not Applicable
(Former Name or Former Address, if Changed Since
Last Report)
Check the appropriate box below if the Form
8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions
(see General Instruction A.2. below):
x |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|
|
¨ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
|
|
¨ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
|
|
¨ |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 1.01 Entry into a Material
Definitive Agreement
On January 5, 2016, Cape Bancorp, Inc. (the
“Company” or “Cape”) entered into an Agreement and Plan of Merger (the “Merger Agreement”)
by and among the Company, OceanFirst Financial Corp. (“OceanFirst”), a Delaware corporation and the parent company
of OceanFirst Bank, and Justice Merger Sub Corp. (“Merger Sub”), a Maryland corporation and the wholly-owned
subsidiary of OceanFirst. Pursuant to the Merger Agreement, Merger Sub will merge with and into the Company, with
the Company as the surviving entity, and immediately thereafter the Company will merge with and into OceanFirst, with OceanFirst
as the surviving entity (the “Merger”). It is anticipated that immediately after the Merger, Cape Bank, a New Jersey-chartered
savings bank, will merge with and into OceanFirst Bank, a federal savings bank, with OceanFirst Bank as the surviving bank.
The Merger Agreement has been unanimously approved
by the boards of directors of each of the Company and OceanFirst. Subject to the approval of the Merger Agreement by the Company’s
shareholders, the approval of the issuance of the stock consideration by OceanFirst’s shareholders as required by applicable
NASDAQ rules, the receipt of all regulatory approvals and other customary closing conditions, the parties anticipate completing
the Merger in the summer of 2016.
At the effective time of the Merger, Company
stockholders will be entitled to receive $2.25 in cash and 0.6375 shares (the “Exchange Ratio”) of OceanFirst
common stock for each share of Company common stock (the “Merger Consideration”). Additionally, all outstanding and
unexercised options to purchase Company common stock will convert into the right to receive a number of shares of OceanFirst common
stock (rounded down to the nearest whole share) determined by multiplying (x) the number of shares of Cape common stock subject
to such Cape option immediately prior to the effective time by (y) 0.75; and the exercise per share of the new option (rounded
up to the nearest whole cent) will be equal to the quotient obtained by dividing (i) the per share exercise price for the shares
of Cape common stock subject to such Cape option by (ii) 0.75. Each Cape restricted stock award outstanding will vest at the effective
time and will convert into the right to receive the Merger Consideration.
Pursuant to the terms of the Merger Agreement,
Michael D. Devlin, President and Chief Executive Officer of the Company and Cape Bank, will be appointed to the boards of directors
of OceanFirst and OceanFirst Bank following the Merger.
The Merger Agreement contains representations,
warranties and covenants of the Company and OceanFirst including, among others, covenants that require (i) the Company to conduct
its business in the ordinary course during the period between the execution of the Merger Agreement and the effective time of
the Merger or earlier termination of the Merger Agreement and (ii) the Company to not engage in certain kinds of transactions
during such period (without the prior written consent of OceanFirst). Subject to certain terms and conditions, the Company’s
board of directors will recommend the approval and adoption of the Merger Agreement and the Merger contemplated thereby, and
will solicit proxies voting in favor of the Merger Agreement from the Company’s stockholders. The Company has also agreed
not to (i) solicit proposals relating to alternative business combinations or (ii) subject to certain
exceptions, enter into discussions or negotiations or provide confidential
information in connection with any proposals for alternative business combination transactions.
The Merger Agreement provides certain termination
rights for both the Company and OceanFirst, and further provides that upon the termination of the Merger Agreement under certain
circumstances, the Company or OceanFirst, as applicable, will be obligated to pay the other party a termination fee of $7.2
million.
As noted above, consummation of the Merger
is subject to customary closing conditions, including (i) receipt of the requisite approval of the Company’s
and OceanFirst’s stockholders, (ii) receipt of regulatory approvals, (iii) absence of any law or order prohibiting
the closing, (iv) effectiveness of the registration statement to be filed by OceanFirst with the Securities and Exchange Commission
(the “SEC”) with respect to the OceanFirst common stock to be issued in the Merger, and (v) authorization for listing
on the NASDAQ Global Select Market of the shares of OceanFirst common stock to be issued in the Merger. In addition, each
party’s obligation to consummate the Merger is subject to certain other customary closing conditions, including (i)
the accuracy of the representations and warranties of the other party (subject to certain materiality standards), (ii)
compliance of the other party with its covenants (subject to certain materiality standards) and (iii) receipt by such party
of an opinion from such party’s counsel to the effect that the Merger will qualify as a reorganization within the meaning
of Section 368(a) of the Internal Revenue Code of 1986, as amended.
The Merger Agreement includes customary representations,
warranties and covenants of the Company and OceanFirst made to each other as of specific dates. The assertions embodied in those
representations and warranties were made solely for purposes of the contract by and among the Company and OceanFirst and are not
intended to provide factual, business, or financial information about the Company or OceanFirst. Moreover, some of those representations
and warranties may not be accurate or complete as of any specified date, may be subject to a contractual standard of materiality
different from those generally applicable to stockholders or different from what a stockholder might view as material, may have
been used for purposes of allocating risk between the Company and OceanFirst rather than establishing matters as facts, may have
been qualified by certain disclosures not reflected in the Merger Agreement that were made to the other party in connection with
the negotiation of the Merger Agreement and generally were solely for the benefit of the parties to that agreement. Stockholders
should read the Merger Agreement together with the other information concerning OceanFirst and the Company that is publicly filed
in reports and statements with the SEC.
The foregoing description of the Merger Agreement
is included to provide information regarding its terms and does not purport to be complete and is qualified in its entirety by
reference to the Merger Agreement, which is filed as Exhibit 2.1 to this Current Report on Form 8-K, and is incorporated into this
report by reference.
Additional Information for Shareholders
This communication is being made in respect
of the proposed Merger involving OceanFirst and Cape. This material is not a solicitation of any vote or approval of OceanFirst’s
or Cape’s shareholders and is not a substitute for the joint proxy statement/prospectus or any
other documents which OceanFirst and Cape may send to their respective
shareholders in connection with the proposed Merger. This communication shall not constitute an offer to sell or the solicitation
of an offer to buy any securities.
In connection with the proposed Merger, OceanFirst intends
to file a registration statement on Form S-4 containing a joint proxy statement/prospectus and other documents regarding the proposed
Merger with the SEC. Before making any voting or investment decision, the respective investors and shareholders of OceanFirst
and Cape are urged to carefully read the entire joint proxy statement/prospectus when it becomes available and any other relevant
documents filed by either company with the SEC, as well as any amendments or supplements to those documents, because they will
contain important information about OceanFirst, Cape and the proposed Merger. Investors and security holders are also urged
to carefully review and consider each of OceanFirst’s and Cape’s public filings with the SEC, including but not limited
to their Annual Reports on Form 10-K, their proxy statements, their Current Reports on Form 8-K and their Quarterly Reports on
Form 10-Q. When available, copies of the joint proxy statement/prospectus will be mailed to the respective shareholders of OceanFirst
and Cape. When available, copies of the joint proxy statement/prospectus also may be obtained free of charge at the SEC’s web
site at http://www.sec.gov, or by directing a request to OceanFirst Financial Corp., 975 Hooper Avenue, Toms River, New Jersey
08753, Attn: Jill Apito Hewitt, Senior Vice President and Investor Relations Officer or Cape Bancorp, Inc., 225 North Main Street,
Cape May Court House, New Jersey 08210, Attn: Michael D. Devlin, President and Chief Executive Officer.
Participants in the Solicitation
OceanFirst, Cape and certain of their respective directors and
executive officers, under the SEC’s rules, may be deemed to be participants in the solicitation of proxies of OceanFirst’s
and Cape’s shareholders in connection with the proposed Merger. Information about the directors and executive officers of
OceanFirst and their ownership of OceanFirst common stock is set forth in the proxy statement for OceanFirst’s 2015 Annual
Meeting of Shareholders, as filed with the SEC on Schedule 14A on March 27, 2015. Information about the directors and executive
officers of Cape and their ownership of Cape’s common stock is set forth in the proxy statement for Cape’s 2015 Annual
Meeting of Shareholders, as filed with the SEC on Schedule 14A on March 24, 2015. Additional information regarding the interests
of those participants and other persons who may be deemed participants in the solicitation of proxies of OceanFirst’s and
Cape’s shareholders in connection with the proposed Merger may be obtained by reading the joint proxy statement/prospectus
regarding the proposed Merger when it becomes available. Free copies of this document may be obtained as described in the preceding
paragraph.
Forward-Looking Statements
This report contains forward-looking statements.
These forward-looking statements may include: management plans relating to the Merger; the expected timing of the completion of
the Merger; the ability to complete the Merger; the ability to obtain any required regulatory, shareholder or other approvals;
any statements of the plans and objectives of management for future operations, products or services, including the execution of
integration plans; any
statements of expectation or belief; projections related to certain
financial metrics; and any statements of assumptions underlying any of the foregoing. Forward-looking statements are typically
identified by words such as “believe,” “expect,” “anticipate,” “intend,” “outlook,”
“estimate,” “forecast,” “project” and other similar words and expressions. Forward-looking
statements are subject to numerous assumptions, risks and uncertainties, which change over time and are beyond our control. Forward-looking
statements speak only as of the date they are made. Neither OceanFirst nor Cape assumes any duty and does not undertake to update
forward-looking statements. Because forward-looking statements are subject to assumptions and uncertainties, actual results or
future events could differ, possibly materially, from those that OceanFirst or Cape anticipated in its forward-looking statements
and future results could differ materially from historical performance. Factors that could cause or contribute to such differences
include, but are not limited to, those included under Item 1A “Risk Factors” in OceanFirst’s Annual Report
on Form 10-K, those included under Item 1A “Risk Factors” in Cape’s Annual Report on Form 10-K, those disclosed
in OceanFirst’s and Cape’s respective other periodic reports filed with the Securities and Exchange Commission (the
“SEC”), as well as the possibility: that expected benefits may not materialize in the timeframe expected or at all,
or may be more costly to achieve; that the Merger may not be timely completed, if at all; that prior to the completion of the Merger
or thereafter, OceanFirst’s and Cape’s respective businesses may not perform as expected due to transaction-related
uncertainty or other factors; that the parties are unable to successfully implement integration strategies; that required regulatory,
shareholder or other approvals are not obtained or other customary closing conditions are not satisfied in a timely manner or at
all; reputational risks and the reaction of the companies’ customers, employees and other constituents to the Merger; and
diversion of management time on merger-related matters. For any forward-looking statements made in this report or in any documents,
OceanFirst and Cape claim the protection of the safe harbor for forward-looking statements contained in the Private Securities
Litigation Reform Act of 1995.
Item 9.01. Financial Statements and Exhibits
(a) |
Financial statements of businesses acquired. Not Applicable. |
|
|
(b) |
Pro forma financial information. Not Applicable. |
|
|
(c) |
Shell company transactions: Not Applicable. |
|
|
(d) |
Exhibits. |
Exhibit
No. |
|
Description |
|
|
|
2.1 |
|
Agreement and Plan of Merger dated as of January 5, 2016 by and among OceanFirst Financial Corp., Justice Merger Sub Corp. and Cape Bancorp, Inc. |
SIGNATURES
Pursuant to the requirements
of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned,
hereunto duly authorized.
|
|
CAPE BANCORP, INC. |
|
|
|
DATE: January 7, 2016 |
By: |
/s/ Michael D. Devlin |
|
|
Michael D. Devlin |
|
|
President and Chief Executive Officer |
EXHIBIT INDEX
Exhibit |
|
Description |
|
|
|
2.1 |
|
Agreement and Plan of Merger dated as of January 5, 2016 by and among OceanFirst Financial Corp., Justice Merger Sub Corp. and Cape Bancorp, Inc. |
Exhibit 2.1
EXECUTION VERSION
AGREEMENT AND PLAN OF MERGER
by and among
OCEANFIRST FINANCIAL CORP.,
JUSTICE MERGER SUB CORP.
and
CAPE BANCORP, INC.
Dated as of January 5, 2016
TABLE OF CONTENTS
|
|
Page |
|
|
|
Article
I |
|
THE INTEGRATED
MERGERS |
|
|
|
1.1 |
The Integrated Mergers;
Effective Time |
2 |
1.2 |
Closing |
2 |
1.3 |
Effects of the Integrated
Mergers |
2 |
1.4 |
Effects of First-Step
Merger on Merger Sub and Parent Common Stock |
2 |
1.5 |
Conversion of Company
Common Stock |
3 |
1.6 |
Effects of Second-Step
Merger on Capital Stock |
4 |
1.7 |
Treatment of Company
Equity Awards |
4 |
1.8 |
Certificate of Incorporation
of Surviving Corporation |
5 |
1.9 |
Bylaws of Surviving
Corporation |
5 |
1.10 |
Directors; Officers |
5 |
1.11 |
Tax Consequences |
6 |
1.12 |
Bank Merger |
6 |
|
|
|
Article
II |
|
EXCHANGE
OF SHARES |
|
|
|
2.1 |
Parent to Make Merger
Consideration Available |
6 |
2.2 |
Exchange of Shares |
6 |
|
|
|
Article
III |
|
REPRESENTATIONS
AND WARRANTIES OF THE COMPANY |
|
|
|
3.1 |
Corporate Organization |
9 |
3.2 |
Capitalization |
11 |
3.3 |
Authority; No Violation |
12 |
3.4 |
Consents and Approvals |
13 |
3.5 |
Reports |
13 |
3.6 |
Financial Statements |
14 |
3.7 |
Broker’s Fees |
15 |
3.8 |
Absence of Certain
Changes or Events |
16 |
3.9 |
Legal Proceedings |
16 |
3.10 |
Taxes and Tax Returns |
16 |
3.11 |
Employees |
18 |
3.12 |
SEC Reports |
21 |
3.13 |
Compliance with Applicable
Law |
22 |
3.14 |
Certain Contracts |
23 |
3.15 |
Agreements with Regulatory
Agencies |
24 |
3.16 |
Risk Management Instruments |
24 |
3.17 |
Environmental Matters |
25 |
3.18 |
Investment Securities
and Commodities |
25 |
3.19 |
Real Property |
26 |
3.20 |
Intellectual Property |
26 |
3.21 |
Related Party Transactions |
27 |
3.22 |
Takeover Statutes |
27 |
3.23 |
Opinion |
27 |
3.24 |
Company Information |
27 |
3.25 |
Loan Portfolio |
28 |
3.26 |
Insurance |
29 |
3.27 |
No Dissenter’s
or Appraisal Rights |
29 |
3.28 |
No Other Representations
or Warranties |
29 |
|
|
|
Article
IV |
|
REPRESENTATIONS
AND WARRANTIES OF PARENT |
|
4.1 |
Corporate Organization |
30 |
4.2 |
Capitalization |
31 |
4.3 |
Authority; No Violation |
32 |
4.4 |
Consents and Approvals |
33 |
4.5 |
Reports |
34 |
4.6 |
Financial Statements |
34 |
4.7 |
Broker’s Fees |
35 |
4.8 |
Absence of Certain
Changes or Events |
36 |
4.9 |
Legal Proceedings |
36 |
4.10 |
Taxes and Tax Returns |
36 |
4.11 |
Employees |
37 |
4.12 |
SEC Reports |
38 |
4.13 |
Compliance with Applicable
Law |
38 |
4.14 |
Agreements with Regulatory
Agencies |
39 |
4.15 |
Certain Contracts. |
40 |
4.16 |
Environmental Matters |
40 |
4.17 |
Insurance |
41 |
4.18 |
Real Property |
41 |
4.19 |
Loan Portfolio |
41 |
4.20 |
Takeover Statutes |
42 |
4.21 |
Opinion |
42 |
4.22 |
Parent Information |
42 |
4.23 |
No Other Representations
or Warranties |
42 |
|
|
|
Article
V |
|
COVENANTS
RELATING TO CONDUCT OF BUSINESS |
|
|
|
5.1 |
Conduct of Business
of the Company Prior to the Effective Time |
43 |
5.2 |
Company Forbearances |
43 |
5.3 |
Parent Forbearances |
47 |
5.4 |
Tax-free Reorganization |
48 |
|
|
|
Article
VI |
|
ADDITIONAL
AGREEMENTS |
|
|
|
6.1 |
Regulatory Matters |
48 |
6.2 |
Access to Information |
49 |
6.3 |
Shareholders’
Approvals |
50 |
6.4 |
Legal Conditions to
Merger |
52 |
6.5 |
Stock Exchange Listing |
52 |
6.6 |
Employee Matters |
52 |
6.7 |
Indemnification; Directors’
and Officers’ Insurance |
55 |
6.8 |
Additional Agreements |
56 |
6.9 |
Advice of Changes |
56 |
6.10 |
Dividends |
56 |
6.11 |
Corporate Governance |
57 |
6.12 |
Acquisition Proposals |
57 |
6.13 |
Board of Directors
and Committee Meetings |
58 |
6.14 |
Public Announcements |
59 |
6.15 |
Change of Method |
59 |
6.16 |
Restructuring Efforts |
59 |
6.17 |
Takeover Statutes |
59 |
6.18 |
Exemption from Liability
Under Section 16(b) |
60 |
6.19 |
No Control of Other
Party’s Business |
60 |
6.20 |
Parent Voting Agreements |
60 |
|
|
|
Article
VII |
|
CONDITIONS
PRECEDENT |
|
|
|
7.1 |
Conditions to Each
Party’s Obligation To Effect the Integrated Mergers |
61 |
7.2 |
Conditions to Obligations
of Parent |
61 |
7.3 |
Conditions to Obligations
of the Company |
62 |
|
|
|
Article
VIII |
|
TERMINATION
AND AMENDMENT |
|
|
|
8.1 |
Termination |
63 |
8.2 |
Effect of Termination |
66 |
8.3 |
Amendment |
67 |
8.4 |
Extension; Waiver |
67 |
Article
IX |
|
GENERAL
PROVISIONS |
|
|
|
9.1 |
Nonsurvival of Representations,
Warranties and Agreements |
67 |
9.2 |
Expenses |
68 |
9.3 |
Notices |
68 |
9.4 |
Interpretation |
69 |
9.5 |
Counterparts |
69 |
9.6 |
Entire Agreement |
69 |
9.7 |
Governing Law; Jurisdiction |
70 |
9.8 |
Waiver of Jury Trial |
70 |
9.9 |
Assignment; Third
Party Beneficiaries |
70 |
9.10 |
Specific Performance |
71 |
9.11 |
Severability |
71 |
9.12 |
Delivery by Facsimile
or Electronic Transmission |
71 |
Exhibit A – Bank Merger Agreement
INDEX OF DEFINED TERMS
|
Page |
Acquisition Proposal |
58 |
Agreement |
1 |
Articles of Merger |
2 |
Bank Merger |
6 |
Bank Merger Agreement |
6 |
Bank Merger Certificate |
6 |
BHCA |
9 |
Cash Consideration |
3 |
Chosen Courts |
70 |
Closing |
2 |
Closing Date |
2 |
Code |
1 |
Company |
1 |
Company Articles |
10 |
Company Bank |
6 |
Company Benefit Plans |
18 |
Company Bylaws |
10 |
Company Common Stock |
3 |
Company Contract |
24 |
Company Disclosure
Schedule |
9 |
Company Equity Awards |
5 |
Company Equity Plan |
4 |
Company ERISA Affiliate |
18 |
Company ESOP |
54 |
Company Indemnified
Parties |
55 |
Company Insiders |
60 |
Company Leased Properties |
26 |
Company Meeting |
50 |
Company Owned Properties |
26 |
Company Qualified
Plans |
19 |
Company Real Property |
26 |
Company Regulatory
Agreement |
24 |
Company Reports |
21 |
Company Restricted
Stock Award |
5 |
Company Stock Option |
4 |
Company Subsidiary |
10 |
Confidentiality Agreement |
50 |
Continuing Employees |
52 |
Converted Company
Option |
4 |
Delaware Secretary |
2 |
Derivative Contract |
24 |
Determination Date |
65 |
DGCL |
2 |
DOL |
18 |
Effective
Time |
2 |
Enforceability Exceptions |
25 |
Environmental Laws |
25 |
ERISA |
18 |
ESOP Termination Date |
54 |
Exception Shares |
3 |
Exchange Act |
13 |
Exchange Agent |
6 |
Exchange Fund |
6 |
Exchange Ratio |
3 |
FDIC |
10 |
Federal Reserve Board |
9 |
FHLB |
10 |
Final Index Price |
65 |
First-Step Merger |
1 |
GAAP |
10 |
Governmental Entity |
13 |
HOLA |
30 |
Index |
65 |
Index Ratio |
65 |
Initial Index Price |
66 |
Initial Parent Market
Value |
66 |
Integrated Mergers |
1 |
Intellectual Property |
26 |
IRS |
18 |
Joint Proxy Statement |
13 |
Liens |
11 |
Loan Participation |
28 |
Loans |
28 |
Material Adverse Effect |
9 |
Materially Burdensome
Regulatory Condition |
49 |
Merger Consideration |
3 |
Merger Sub |
1 |
Merger Sub Articles |
5 |
Merger Sub Bylaws |
5 |
MGCL |
2 |
Multiemployer Plan |
19 |
Multiple Employer
Plan |
19 |
NASDAQ |
8 |
New Certificates |
3 |
New Plans |
53 |
NJ Department |
13 |
OCC |
13 |
Old Certificate |
3 |
Parent |
1 |
Parent Bank |
6 |
Parent
Benefit Plans |
37 |
Parent Bylaws |
5 |
Parent Certificate |
5 |
Parent Common Stock |
3 |
Parent Contract |
40 |
Parent Disclosure
Schedule |
30 |
Parent Equity Awards |
32 |
Parent ERISA Affiliate |
37 |
Parent ESOP |
54 |
Parent Leased Properties |
41 |
Parent Market Value |
66 |
Parent Meeting |
50 |
Parent Owned Properties |
41 |
Parent Real Property |
41 |
Parent Regulatory
Agreement |
39 |
Parent Reports |
38 |
Parent Restricted
Stock Awards |
31 |
Parent Severance Plan |
53 |
Parent Stock Options |
31 |
Parent Subsidiary |
31 |
Parent Voting Agreements |
60 |
PBGC |
18 |
Permitted Encumbrances |
26 |
Premium Cap |
55 |
Regulatory Agencies |
13 |
Representatives |
57 |
Requisite Company
Vote |
12 |
Requisite Parent Vote |
32 |
Requisite Regulatory
Approvals |
49 |
Restrictive Covenant |
21 |
S-4 |
13 |
Sarbanes-Oxley Act |
15 |
SDAT |
2 |
SEC |
13 |
Second-Step Merger |
1 |
Second-Step Merger
Certificates |
2 |
Securities Act |
21 |
SRO |
13 |
Stock Consideration |
3 |
Subsidiary |
10 |
Superior Proposal |
58 |
Surviving Corporation |
1 |
Takeover Statutes |
27 |
Tax |
18 |
Tax Return |
18 |
Taxes |
18 |
Terminated
Plan |
53 |
Termination
Date |
64 |
Termination
Fee |
66 |
Voting
Agreements |
1 |
AGREEMENT AND PLAN OF MERGER
This AGREEMENT AND PLAN OF MERGER, dated
as of January 5, 2016 (this “Agreement”), is by and among OceanFirst Financial Corp., a Delaware corporation
(“Parent”), Justice Merger Sub Corp., a Maryland corporation and a wholly-own Subsidiary of Parent (“Merger
Sub”), and Cape Bancorp, Inc., a Maryland corporation (the “Company”).
W I T N E S S E T H:
WHEREAS, the Boards of Directors of
Parent and the Company have determined that it is in the best interests of their respective companies and their shareholders to
consummate the strategic business combination transaction provided for herein, pursuant to which (i) Merger Sub will, subject
to the terms and conditions set forth herein, merge with and into the Company (the “First-Step Merger”), so
that the Company is the surviving corporation in the First-Step Merger and a wholly-owned Subsidiary of Parent and (ii) immediately
thereafter, the Company, as the surviving corporation in the First-Step Merger, will merge (the “Second-Step Merger”,
and together with the First-Step Merger, the “Integrated Mergers”) with and into Parent, with Parent being
the surviving corporation (hereinafter sometimes referred to in such capacity as the “Surviving Corporation”);
WHEREAS, for U.S. federal income tax
purposes, it is intended that the Integrated Mergers shall together be treated as a single integrated transaction that qualifies
as a “reorganization” within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended (the “Code”),
and this Agreement is intended to be, and is adopted as, a plan of reorganization for purposes of Sections 354, 361 and 368 of
the Code and within the meaning of Treasury regulation section 1.368-2(g);
WHEREAS, concurrently with the execution
and delivery of this Agreement, as a condition and an inducement for Parent to enter into this Agreement, certain shareholders
of the Company have simultaneously herewith entered into separate voting agreements with Parent (collectively, the “Voting
Agreements”) in connection with the First-Step Merger; and
WHEREAS, the parties desire to make
certain representations, warranties and agreements in connection with the Integrated Mergers and also to prescribe certain conditions
to the Integrated Mergers.
NOW, THEREFORE, in consideration of
the mutual covenants, representations, warranties and agreements contained herein, and intending to be legally bound hereby, the
parties agree as follows:
Article
I
THE
INTEGRATED MERGERS
1.1 The
Integrated Mergers; Effective Time.
(a) Subject
to the terms and conditions of this Agreement, in accordance with the Maryland General Corporation Law (the “MGCL”),
at the Effective Time, Merger Sub shall merge with and into the Company. The Company shall be the surviving corporation
in the First-Step Merger, and shall continue its corporate existence under the laws of the State of Maryland. Upon consummation
of the First-Step Merger, the separate corporate existence of Merger Sub shall terminate. On or before the Closing Date, Parent
and the Company, respectively, shall cause to be filed articles of merger with the Maryland State Department of Assessments and
Taxation (the “SDAT”) in accordance with the MGCL (the “Articles of Merger”). The
First-Step Merger shall become effective as of the date and time specified in the Articles of Merger (such date and time, the “Effective
Time”).
(b) Immediately
following the Effective Time, subject to the terms and conditions of this Agreement, in accordance with the Delaware General Corporation
Law (the “DGCL”) and the MGCL, the Company, as the surviving corporation in the First-Step Merger, shall merge
with and into Parent. Parent shall be the Surviving Corporation in the Second-Step Merger, and shall continue its corporate
existence under the laws of the State of Delaware. Upon consummation of the Second-Step Merger, the separate corporate
existence of the Company shall terminate. On or before the Closing Date, Parent and the Company, respectively, shall
cause to be filed a certificate of merger with the Secretary of State of the State of Delaware (the “Delaware Secretary”)
and articles of merger with the SDAT (collectively, the “Second-Step Merger Certificates”). The Second-Step
Merger shall become effective as of the date and time specified in the Second-Step Merger Certificates.
1.2 Closing. Subject
to the terms and conditions of this Agreement, the closing of the Integrated Mergers (the “Closing”) will take
place at 10:00 a.m., New York City time, at the offices of Skadden, Arps, Slate, Meagher and Flom LLP, on a date which shall be
no later than two (2) business days after the satisfaction or waiver (subject to applicable law) of the latest to occur of the
conditions set forth in Article VII hereof (other than those conditions that by their nature can only be satisfied at the
Closing, but subject to the satisfaction or waiver thereof), unless another date, time or place is agreed to in writing by Parent
and the Company. The date on which the Closing occurs is referred to in this Agreement as the “Closing Date.”
1.3 Effects
of the Integrated Mergers. At and after the Effective Time, the First-Step Merger
shall have the effects set forth in the applicable provisions of the MGCL. At the effective time of the Second-Step
Merger, the Second-Step Merger shall have the effects set forth in the applicable provisions of the DGCL and the MGCL.
1.4 Effects
of First-Step Merger on Merger Sub and Parent Common Stock. At and after the Effective Time, each share of (a) capital stock
of Merger Sub issued and outstanding immediately prior to the Effective Time shall be converted into and become one newly and validly
issued, fully paid and nonassesable share of the capital stock of the Company
and (b) common stock, par value $0.01 per
share, of Parent (the “Parent Common Stock”) issued and outstanding immediately prior to the Effective Time
shall remain issued and outstanding and shall not be affected by the First-Step Merger.
1.5 Conversion
of Company Common Stock. At the Effective Time, by virtue of the First-Step Merger and without any action on the
part of Parent, Merger Sub or the Company or the holder of any of the following securities:
(a) Subject
to Section 2.2(e), each share of the common stock, par value $0.01 per share, of the Company (the “Company Common
Stock”) issued and outstanding immediately prior to the Effective Time, except for shares of Company Common Stock owned
by the Company as treasury stock or owned by the Company or Parent (in each case, other than shares of Company Common Stock held
in any Company Benefit Plans or related trust accounts, managed accounts, mutual funds and the like, or otherwise held in a fiduciary
or agency capacity or as a result of debts previously contracted (collectively, the “Exception Shares”)), shall
be converted, in accordance with the procedures set forth in this Agreement, into the right to receive the following, without interest:
(i) $2.25
in cash (the “Cash Consideration”); and
(ii) 0.6375
(the “Exchange Ratio”) validly issued, fully paid and nonassessable shares of Parent Common Stock (the “Stock
Consideration” and, together with the Cash Consideration, the “Merger Consideration”) and cash in
lieu of fractional shares as calculated pursuant to Section 2.2(e); it being understood that upon the effective
time of the Second-Step Merger, the Parent Common Stock, including the shares issued to former holders of Company Common Stock
as Merger Consideration, shall be the common stock of the Surviving Corporation.
(b) All
of the shares of Company Common Stock converted into the right to receive the Merger Consideration pursuant to this Article
I shall no longer be outstanding and shall automatically be cancelled and shall cease to exist as of the Effective Time, and
each certificate (each, an “Old Certificate”, it being understood that any reference herein
to “Old Certificate” shall be deemed to include reference to book-entry account statements relating to the ownership
of shares of Company Common Stock) previously representing any such shares of Company Common Stock shall thereafter represent only
the right to receive (i) the Merger Consideration in accordance with, and subject to, Section 1.5(a), (ii) cash in lieu
of fractional shares which the shares of Company Common Stock represented by such Old Certificate have been converted into the
right to receive pursuant to this Section 1.5 and Section 2.2(e), without any interest thereon and (iii) any dividends
or distributions which the holder thereof has the right to receive pursuant to Section 2.2(b). Old Certificates
previously representing shares of Company Common Stock shall be exchanged for evidence of shares in book entry form or, at Parent’s
option, certificates (collectively referred to herein as “New Certificates”), representing the Stock Consideration
(together with any dividends or distributions with respect thereto and cash in lieu of fractional shares issued in consideration
therefor) and the Cash Consideration, as applicable, upon the surrender of such Old Certificates in accordance with Section
2.2, without any interest thereon. If, prior to the Effective Time, the outstanding shares of Parent Common
Stock or Company Common Stock shall have
been increased, decreased, or changed into or exchanged for a different number or kind of shares or securities, in any such case
as a result of a reorganization, recapitalization, reclassification, stock dividend, stock split, reverse stock split, or other
similar change in capitalization, or there shall be any extraordinary dividend or distribution, an appropriate and proportionate
adjustment shall be made to the Merger Consideration to give holders of Company Common Stock the same economic effect as contemplated
by this Agreement prior to such event.
(c) Notwithstanding
anything in this Agreement to the contrary, at the Effective Time, all shares of Company Common Stock that are owned by the Company
or Parent (in each case, other than the Exception Shares) shall be cancelled and shall cease to exist and neither the Merger Consideration
nor any other consideration shall be delivered in exchange therefor.
1.6 Effects
of Second-Step Merger on Capital Stock. At the effective time of the Second-Step Merger, each share of (a) Parent
Common Stock issued and outstanding immediately prior to such time shall remain issued and outstanding and shall not be affected
by the Second-Step Merger and (b) capital stock of the Company, as the surviving corporation in the First-Step Merger, issued and
outstanding immediately prior to such time, shall be cancelled and shall cease to exist and neither the Merger Consideration nor
any other consideration shall be delivered in exchange therefor.
1.7 Treatment
of Company Equity Awards.
(a) At
the Effective Time, each option granted by the Company to purchase shares of Company Common Stock under the Cape Bancorp, Inc.
2008 Equity Incentive Plan (the “Company Equity Plan”) and the Colonial Financial Services, Inc. 2011 Equity
Incentive Plan, whether vested or unvested, that is outstanding and unexercised immediately prior to the Effective Time (a “Company
Stock Option”) shall, without any further action on the part of any holder thereof, be assumed and converted into an
option to purchase from Parent, on the same terms and conditions as were applicable under such Company Stock Option immediately
prior to the Effective Time, a number of shares of Parent Common Stock (rounded down to the nearest whole share) determined by
multiplying (x) the number of shares of Company Common Stock subject to such Company Stock Option immediately prior to the Effective
Time by (y) 0.75, at a per share exercise price (rounded up to the nearest whole cent) equal to the quotient obtained by dividing
(i) the per share exercise price for each share of Company Common Stock subject to such Company Stock Option by (ii) 0.75 (each,
as so adjusted, a “Converted Company Option”). All rounding described in this Section 1.7(a)
shall be done on an aggregate basis.
(b) The
Converted Company Options shall have the same vesting schedule (including any acceleration of vesting as provided in the Company
Equity Plan) as the Company Stock Options and otherwise shall have the same terms and conditions as such Company Stock Options;
provided, that Parent shall convert the Company Stock Options into Converted Company Options in a manner consistent with
the requirements of Sections 409A and 424(a) of the Code, as applicable. After such assumption and conversion, the Converted
Company Options shall be subject to all of the terms and conditions of the plan and grant
agreements under which the Company Stock
Options were originally issued (including any applicable change in control or other accelerated vesting provisions, and this transaction
shall constitute a change in control for all relevant provisions).
(c) At
the Effective Time, each restricted stock award in respect of shares of Company Common Stock granted under the Company Equity Plan
that is outstanding immediately prior to the Effective Time (a “Company Restricted Stock Award”) shall be or
become fully vested and the restrictions thereon shall lapse, and each holder thereof shall be entitled to receive the Merger Consideration
in accordance with Section 1.5 of this Agreement. The Company will be entitled to deduct and withhold such amounts as may
be required to be deducted and withheld under the Code and any applicable state or local tax laws as allowed under the Company
Equity Plan. For purposes of this Agreement, the Company Stock Options and Company Restricted Stock Awards shall be
referred to as the “Company Equity Awards.”
(d) At
or prior to the Effective Time, the Company, the Board of Directors of the Company and its compensation committee, as applicable,
shall adopt any resolutions and take any actions that are necessary, including obtaining any consents, to (i) effectuate the provisions
of this Section 1.7, (ii) ensure that following the Effective Time, there are no obligations with respect to the Company
Equity Awards other than as set forth in this Section 1.7 and (iii) terminate the Company Equity Plan solely for purposes
of granting new Company Equity Awards, effective as of the Effective Time; provided, that no action taken by the Company
shall be required to be irrevocable until immediately prior to the Effective Time.
1.8 Certificate
of Incorporation of Surviving Corporation. At the Effective Time, the Articles of Incorporation of Merger Sub (the
“Merger Sub Articles”), as in effect immediately prior to the Effective Time, shall be the Articles of Incorporation
of the Company until thereafter amended in accordance with their terms and applicable law. At the effective time of
the Second-Step Merger, the Certificate of Incorporation of Parent (the “Parent Certificate”), as in effect
immediately prior to the Effective Time, shall be the Certificate of Incorporation of the Surviving Corporation until thereafter
amended in accordance with their terms and applicable law.
1.9 Bylaws
of Surviving Corporation. At the Effective Time, the Bylaws of Merger Sub (the “Merger Sub Bylaws”),
as in effect immediately prior to the Effective Time, shall be the Bylaws of the Company until thereafter amended in accordance
with their terms and applicable law. At the effective time of the Second-Step Merger, the Bylaws of Parent (the “Parent
Bylaws”), as in effect immediately prior to the Effective Time, shall be the Bylaws of the Surviving Corporation until
thereafter amended in accordance with their terms and applicable law.
1.10 Directors;
Officers. At and immediately after the Effective Time, the directors and officers of the Company shall consist of
the directors and officers of Merger Sub in office immediately prior to the Effective Time until their respective successor are
duly elected or appointed and qualified. Subject to Section 6.11, the directors and officers of the Surviving
Corporation in the Second-Step Merger shall be the directors and officers of Parent in office immediately prior to the effective
time of the Second-Step Merger.
1.11 Tax
Consequences. For U.S. federal income Tax purposes, (a) the parties intend that (i) the Integrated Mergers shall
together be treated as a single integrated transaction that qualifies as a “reorganization” within the meaning of Section
368(a) of the Code and (ii) Parent, Merger Sub and the Company shall each be a party to such reorganization within the meaning
of Section 368(b) of the Code, and (b) this Agreement is intended to be, and is hereby adopted as, a “plan of reorganization”
for purposes of Sections 354, 361 and 368 of the Code and within the meaning of Treasury regulation Section 1.368-2(g).
1.12 Bank
Merger. Immediately following the consummation of the Integrated Mergers, Cape Bank, a New Jersey-chartered stock
savings bank and a wholly-owned Subsidiary of the Company (“Company Bank”), will merge (the “Bank Merger”)
with and into OceanFirst Bank, a federally-chartered capital stock savings bank and a wholly-owned Subsidiary of Parent (“Parent
Bank”), pursuant to the agreement and plan of merger attached hereto as Exhibit A, dated as of the date hereof,
by and between Company Bank and Parent Bank (the “Bank Merger Agreement”). Parent Bank shall be the
surviving bank in the Bank Merger and, following the Bank Merger, the separate corporate existence of Company Bank shall cease. The
parties agree that the Bank Merger shall become effective immediately after the effective time of the Second-Step Merger. Prior
to the Effective Time, the Company shall cause Company Bank, and Parent shall cause Parent Bank, to execute such certificates or
articles of merger and such other documents and certificates as are necessary to make the Bank Merger effective (the “Bank
Merger Certificate”) immediately following the effective time of the Second-Step Merger.
Article
II
EXCHANGE
OF SHARES
2.1 Parent
to Make Merger Consideration Available. Prior to the Effective Time, Parent shall deposit, or shall cause to be
deposited, with a bank or trust company designated by Parent and reasonably acceptable to the Company (the “Exchange Agent”),
for the benefit of the holders of Old Certificates, for exchange in accordance with this Article II, (a) New Certificates
representing the aggregate Stock Consideration to be issued pursuant to Section 1.5 and exchanged pursuant to Section
2.2(a), and (b) cash in an amount sufficient to pay (i) the aggregate Cash Consideration payable to holders of Company Common
Stock and (ii) cash in lieu of any fractional shares of Parent Common Stock (such cash and New Certificates described in the foregoing
clauses (a) and (b), together with any dividends or distributions with respect thereto (after giving effect to Section
6.10), being hereinafter referred to as the “Exchange Fund”). The Exchange Agent shall invest
any cash included in the Exchange Fund as directed by Parent, provided that no such investment or losses thereon shall affect the
amount of Merger Consideration payable to the holders of Old Certificates. Any interest and other income resulting from
such investments shall be paid to Parent.
2.2 Exchange
of Shares.
(a) As
promptly as practicable after the Effective Time, but in no event later than five (5) business days thereafter, Parent shall cause
the Exchange Agent to mail to each holder of record of one or more Old Certificates representing shares of Company Common Stock
immediately prior to the Effective Time that have been converted at the Effective Time into the
right to receive the Merger Consideration
pursuant to Article I and who has not previously submitted its Old Certificates, a letter of transmittal (which shall specify
that delivery shall be effected, and risk of loss and title to the Old Certificates shall pass, only upon proper delivery of the
Old Certificates to the Exchange Agent) and instructions for use in effecting the surrender of the Old Certificates in exchange
for the Merger Consideration which such holder shall have become entitled to receive in accordance with, and subject to, Section
1.5(a), and any cash in lieu of fractional shares which the shares of Company Common Stock represented by such Old Certificate
or Old Certificates shall have been converted into the right to receive pursuant to this Agreement as well as any dividends or
distributions to be paid pursuant to Section 2.2(b). From and after the Effective Time, upon proper surrender
of an Old Certificate or Old Certificates for exchange and cancellation to the Exchange Agent, together with such properly completed
letter of transmittal duly executed, the holder of such Old Certificate or Old Certificates shall be entitled to receive in exchange
therefor, as applicable, (i) a New Certificate representing the Stock Consideration to which such holder of Company Common Stock
shall have become entitled to receive in accordance with, and subject to, Section 1.5(a), and (ii) a check representing
the amount of (1) the Cash Consideration which such holder has the right to receive in respect of the surrendered Old Certificate
or Old Certificates in accordance with, and subject to, Section 1.5(a), (2) any cash in lieu of fractional shares which
such holder has the right to receive in respect of the surrendered Old Certificate or Old Certificates pursuant to Section 2.2(e)
and (3) any dividends or distributions which the holder thereof has the right to receive pursuant to Section 2.2(b), and
the Old Certificate or Old Certificates so surrendered shall forthwith be cancelled. No interest will be paid or accrued on the
Cash Consideration or any cash in lieu of fractional shares payable to holders of Old Certificates. Until surrendered as contemplated
by this Section 2.2, each Old Certificate shall be deemed at any time after the Effective Time to represent only the right
to receive, upon surrender, the Merger Consideration and any cash in lieu of fractional shares or in respect of dividends or distributions
as contemplated by this Section 2.2.
(b) No
dividends or other distributions declared with respect to Parent Common Stock shall be paid to the holder of any unsurrendered
Old Certificate until the holder thereof shall surrender such Old Certificate in accordance with this Article II. After
the surrender of an Old Certificate in accordance with this Article II, the record holder thereof shall be entitled to receive
any such dividends or other distributions, without any interest thereon, which were previously payable with respect to the Stock
Consideration which the shares of Company Common Stock represented by such Old Certificate have been converted into the right to
receive (after giving effect to Section 6.10).
(c) If
any New Certificate representing shares of Parent Common Stock is to be issued in a name other than that in which the Old Certificate
or Old Certificates surrendered in exchange therefor is or are registered, it shall be a condition of the issuance thereof that
the Old Certificate or Old Certificates so surrendered shall be properly endorsed (or accompanied by an appropriate instrument
of transfer) and otherwise in proper form for transfer, and that the person requesting such exchange shall pay to the Exchange
Agent in advance any transfer or other similar Taxes required by reason of the issuance of a New Certificate representing shares
of Parent Common Stock in any name other than that of the registered holder of the Old Certificate or Old Certificates surrendered,
or required for any other reason, or shall establish to the satisfaction of the Exchange Agent that such Tax has been paid or is
not payable.
(d) After
the Effective Time, there shall be no transfers on the stock transfer books of the Company of the shares of Company Common Stock
that were issued and outstanding immediately prior to the Effective Time. If, after the Effective Time, Old Certificates
representing such shares are presented for transfer to the Exchange Agent, they shall be cancelled and exchanged for the Merger
Consideration, cash in lieu of fractional shares and dividends or distributions that the holder presenting such Old Certificates
is entitled to, as provided in this Article II.
(e) Notwithstanding
anything to the contrary contained herein, no New Certificates or scrip representing fractional shares of Parent Common Stock shall
be issued upon the surrender for exchange of Old Certificates, no dividend or distribution with respect to Parent Common Stock
shall be payable on or with respect to any fractional share, and such fractional share interests shall not entitle the owner thereof
to vote or to any other rights of a shareholder of Parent. In lieu of the issuance of any such fractional share, Parent
shall pay to each former shareholder of the Company who otherwise would be entitled to receive such fractional share an amount
in cash (rounded to the nearest cent) determined by multiplying (i) the average of the closing-sale prices of Parent Common Stock
on The Nasdaq Global Select Market (“NASDAQ”) (as reported by The Wall Street Journal) for the five (5)
full trading days ending on the day preceding the Closing Date by (ii) the fraction of a share (rounded to the nearest thousandth
when expressed in decimal form) of Parent Common Stock which such holder would otherwise be entitled to receive pursuant to Section
1.5.
(f) Any
portion of the Exchange Fund that remains unclaimed by the shareholders of the Company for one (1) year after the Effective Time
shall be paid to the Surviving Corporation. Any former shareholders of the Company who have not theretofore complied
with this Article II shall thereafter look only to the Surviving Corporation for payment of the Merger Consideration, cash
in lieu of any fractional shares and any unpaid dividends and distributions on the Parent Common Stock deliverable in respect of
each former share of Company Common Stock such shareholder holds as determined pursuant to this Agreement, in each case, without
any interest thereon. Notwithstanding the foregoing, none of Parent, the Company, the Surviving Corporation, the Exchange
Agent or any other person shall be liable to any former holder of shares of Company Common Stock for any amount delivered in good
faith to a public official pursuant to applicable abandoned property, escheat or similar laws.
(g) Each
of Parent and Merger Sub shall be entitled to deduct and withhold, or cause the Exchange Agent to deduct and withhold, from the
Merger Consideration, any cash in lieu of fractional shares of Parent Common Stock, cash dividends or distributions payable pursuant
to this Section 2.2 or any other amounts otherwise payable pursuant to this Agreement to any holder of Company Common Stock
such amounts as it is required to deduct and withhold with respect to the making of such payment under the Code or any provision
of state, local or foreign Tax law. To the extent that amounts are so withheld by Parent, Merger Sub or the Exchange
Agent, as the case may be, and paid over to the appropriate governmental authority, the withheld amounts shall be treated for all
purposes of this Agreement as having been paid to the holder of Company Common Stock in respect of which the deduction and withholding
was made by Parent, Merger Sub or the Exchange Agent, as the case may be.
(h) In
the event any Old Certificate shall have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the person
claiming such Old Certificate to be lost, stolen or destroyed and, if requested by Parent, the posting by such person of a bond
in such amount as Parent may determine is reasonably necessary as indemnity against any claim that may be made against it with
respect to such Old Certificate, the Exchange Agent or Parent, as applicable, will issue in exchange for such lost, stolen or destroyed
Old Certificate the Merger Consideration and any cash in lieu of fractional shares deliverable in respect thereof pursuant to this
Agreement.
Article
III
REPRESENTATIONS
AND WARRANTIES OF THE COMPANY
Except (i) as disclosed in the disclosure
schedule delivered by the Company to Parent concurrently herewith (the “Company Disclosure Schedule”); provided,
that (a) no such item is required to be set forth as an exception to a representation or warranty if its absence would not result
in the related representation or warranty being deemed untrue or incorrect, (b) the mere inclusion of an item in the Company Disclosure
Schedule as an exception to a representation or warranty shall not be deemed an admission by the Company that such item represents
a material exception or fact, event or circumstance or that such item is reasonably likely to result in a Material Adverse Effect
and (c) any disclosures made with respect to a section of Article III shall be deemed to qualify (1) any other section of
Article III specifically referenced or cross-referenced and (2) other sections of Article III to the extent it is
reasonably apparent on its face (notwithstanding the absence of a specific cross-reference) from a reading of the disclosure that
such disclosure applies to such other sections or (ii) as disclosed in any Company Reports filed by the Company since December
31, 2014 and prior to the date hereof (but disregarding risk factor disclosures contained under the heading “Risk Factors,”
or disclosures of risks set forth in any “forward-looking statements” disclaimer or any other statements that are similarly
non-specific or cautionary, predictive or forward-looking in nature), the Company hereby represents and warrants to Parent as follows:
3.1 Corporate
Organization.
(a) The
Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Maryland, and is
duly registered with the Board of Governors of the Federal Reserve System (the “Federal Reserve Board”) as a
bank holding company under the Bank Holding Company Act of 1956, as amended (“BHCA”). The Company
has the corporate power and authority to own or lease all of its properties and assets and to carry on its business as it is now
being conducted. The Company is duly licensed or qualified to do business in each jurisdiction in which the nature of
the business conducted by it or the character or location of the properties and assets owned or leased by it makes such licensing
or qualification necessary, except where the failure to be so licensed or qualified would not, either individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect on the Company. As used in this Agreement, the term “Material
Adverse Effect” means, with respect to Parent, the Company or the Surviving Corporation, as the case may be, a material
adverse effect on (i) the business, properties, assets, liabilities, results of operations or financial condition of such party
and its Subsidiaries taken as a whole (provided, however, that, with respect to this
clause (i), Material Adverse Effect
shall not be deemed to include the impact of (A) changes, after the date hereof, in U.S. generally accepted accounting principles
(“GAAP”) or applicable regulatory accounting requirements, (B) changes, after the date hereof, in laws, rules
or regulations of general applicability to companies in the industries in which such party and its Subsidiaries operate, or interpretations
thereof by courts or Governmental Entities, (C) changes, after the date hereof, in global, national or regional political conditions
(including the outbreak of war or acts of terrorism) or in economic or market conditions affecting the financial services industry
generally and not specifically relating to such party or its Subsidiaries, (D) public disclosure of the transactions contemplated
hereby or actions expressly required by this Agreement or actions or omissions that are taken with the prior written consent of
the other party in contemplation of the transactions contemplated hereby; except, with respect to subclauses (A), (B)
or (C), to the extent that the effects of such change are materially disproportionately adverse to the business, properties,
assets, liabilities, results of operations or financial condition of such party and its Subsidiaries, taken as a whole, as compared
to other companies in the industry in which such party and its Subsidiaries operate) or (ii) the ability of such party to timely
consummate the transactions contemplated hereby. As used in this Agreement, the word “Subsidiary”
when used with respect to any person, means any corporation, partnership, limited liability company, bank or other organization,
whether incorporated or unincorporated, or person of which (i) such first person directly or indirectly owns or controls at least
a majority of the securities or other interests having by their terms ordinary voting power to elect a majority of the board of
directors or others performing similar functions or (ii) such first person is or directly or indirectly has the power to appoint
a general partner, manager or managing member or others performing similar functions. True and complete copies of the
Articles of Incorporation of the Company (the “Company Articles”) and the Amended and Restated Bylaws of the
Company (the “Company Bylaws”), as in effect as of the date of this Agreement, have previously been made available
by the Company to Parent.
(b) Company
Bank is a New Jersey chartered savings bank duly organized, validly existing and in good standing under the laws of the State of
New Jersey. The deposits of Company Bank are insured by the Federal Deposit Insurance Corporation (the “FDIC”)
through the Deposit Insurance Fund to the fullest extent permitted by law, all premiums and assessments required to be paid in
connection therewith have been paid when due, and no proceedings for the termination of such insurance are pending or threatened. Company
Bank is a member in good standing of the Federal Home Loan Bank of New York (the “FHLB”) and owns the requisite
amount of stock therein. Without duplication of the representations made by the Company in each of the foregoing sentences of this
Section 3.1(b), each Subsidiary of the Company (each, a “Company Subsidiary”), (i) is duly organized
and validly existing under the laws of its jurisdiction of organization, (ii) is duly qualified to do business and, where such
concept is recognized under applicable law, in good standing in all jurisdictions (whether federal, state, local or foreign) where
its ownership or leasing of property or the conduct of its business requires it to be so qualified and in which the failure to
be so qualified would reasonably be expected to have a Material Adverse Effect on the Company and (iii) has all requisite corporate
power and authority to own or lease its properties and assets and to carry on its business as now conducted. There are
no restrictions on the ability of any Subsidiary of the Company to pay dividends or distributions except, in the case of a Subsidiary
that is a regulated entity, for restrictions on dividends or distributions generally applicable to all such regulated entities. The
deposit accounts of each Subsidiary of the Company that is an insured depository institution are
insured by the FDIC through the Deposit
Insurance Fund to the fullest extent permitted by law, all premiums and assessments required to be paid in connection therewith
have been paid in full when due, and no proceedings for the termination of such insurance are pending or threatened. Section
3.1(b) of the Company Disclosure Schedule sets forth a true and complete list of all Subsidiaries of the Company as of the
date hereof.
3.2 Capitalization.
(a) The
authorized capital stock of the Company consists of 100,000,000 shares of Company Common Stock and 50,000,000 shares of preferred
stock, $0.01 par value, of which no shares of preferred stock are issued or outstanding. As of the date of this Agreement,
there are (i) 13,540,875 shares of Company Common Stock issued and outstanding, (ii) 2,532,834 shares of Company Common Stock held
in treasury, (iii) 799,171 shares of Company Common Stock reserved for issuance upon the exercise of the outstanding Company Stock
Options, (iv) 62,019 shares of Company Common Stock outstanding in respect of Company Restricted Stock Awards and (v) no other
shares of capital stock or other equity securities of the Company issued, reserved for issuance or outstanding. All
of the issued and outstanding shares of Company Common Stock have been duly authorized and validly issued and are fully paid, nonassessable
and free of preemptive rights, with no personal liability attaching to the ownership thereof. There are no bonds, debentures,
notes or other indebtedness that have the right to vote on any matters on which shareholders of the Company may vote. There
are no trust preferred or subordinated debt securities of the Company or any of its Subsidiaries issued or outstanding. Other
than the Company Stock Options and the Company Restricted Stock Awards, in each case, issued prior to the date of this Agreement,
there are no outstanding subscriptions, options, warrants, puts, calls, rights, exchangeable or convertible securities or other
commitments or agreements obligating the Company to issue, transfer, sell, purchase, redeem or otherwise acquire, any such securities. There
are no voting trusts, shareholder agreements, proxies or other agreements in effect with respect to the voting or transfer of Company
Common Stock or other equity interests of the Company, other than the Voting Agreements. Section 3.2(a) of the
Company Disclosure Schedule sets forth a true, correct and complete list of all the Company Equity Awards issued and outstanding
under the Company Equity Plan as of the date hereof specifying, on a holder-by-holder basis, (A) the name of each holder, (B) the
number of shares subject to each such Company Equity Award, (C) the grant date of each such Company Equity Award, (D) the vesting
schedule for each such Company Equity Award, (E) the exercise price for each such Company Equity Award that is a Company Stock
Option, and (F) the expiration date for each such Company Equity Award that is a Company Stock Option. Other than the
Company Equity Awards, no equity-based awards (including any cash awards where the amount of payment is determined in whole or
in part based on the price of any capital stock of the Company or any of its Subsidiaries) are outstanding.
(b) The
Company owns, directly or indirectly, all of the issued and outstanding shares of capital stock or other equity ownership interests
of each of the Company Subsidiaries, free and clear of any liens, pledges, charges, encumbrances and security interests whatsoever
(“Liens”), and all of such shares or equity ownership interests are duly authorized and validly issued and are
fully paid, nonassessable (except, with respect to bank Subsidiaries, as provided under 12 U.S.C. § 55 or any comparable provision
of applicable state law) and free of preemptive rights, with no personal liability attaching to the ownership thereof. No
Company
Subsidiary has or is bound by any outstanding
subscriptions, options, warrants, calls, rights, commitments or agreements of any character calling for the purchase or issuance
of any shares of capital stock or any other equity security of such Subsidiary or any securities representing the right to purchase
or otherwise receive any shares of capital stock or any other equity security of such Subsidiary.
3.3 Authority;
No Violation.
(a) The
Company has full corporate power and authority to execute and deliver this Agreement and to consummate the transactions contemplated
hereby. The execution and delivery of this Agreement and the consummation of the Integrated Mergers have been duly and
validly approved by the Board of Directors of the Company. The Board of Directors of the Company has determined that
the Integrated Mergers, on the terms and conditions set forth in this Agreement, are advisable and in the best interests of the
Company and its shareholders, has adopted this Agreement and has directed that this Agreement and the transactions contemplated
hereby be submitted to the Company’s shareholders for approval at a meeting of such shareholders and has adopted a resolution
to the foregoing effect. Except for the approval of this Agreement by the affirmative vote of the holders of a majority
of the total number of outstanding shares of Company Common Stock entitled to vote at the Company Meeting as required by the Company
Articles and the MGCL (the “Requisite Company Vote”), no other corporate proceedings or approvals on the part
of the Company are necessary to approve this Agreement or to consummate the transactions contemplated hereby. This Agreement
has been duly and validly executed and delivered by the Company and (assuming due authorization, execution and delivery by Parent)
constitutes a valid and binding obligation of the Company, enforceable against the Company in accordance with its terms (except
in all cases as such enforceability may be limited by the Enforceability Exceptions).
(b) Neither
the execution and delivery of this Agreement by the Company nor the consummation by the Company of the transactions contemplated
hereby, nor compliance by the Company with any of the terms or provisions hereof, will (i) violate any provision of the Company
Articles or the Company Bylaws or (ii) assuming that the consents and approvals referred to in Section 3.4 are duly obtained,
(x) violate any statute, code, ordinance, rule, regulation, judgment, order, writ, decree or injunction applicable to the Company
or any of its Subsidiaries or any of their respective properties or assets or (y) violate, conflict with, result in a breach of
any provision of or the loss of any benefit under, constitute a default (or an event which, with notice or lapse of time, or both,
would constitute a default) under, result in the termination of or a right of termination or cancellation under, accelerate the
performance required by, or result in the creation of any Lien upon any of the respective properties or assets of the Company or
any of its Subsidiaries under, any of the terms, conditions or provisions of any note, bond, mortgage, indenture, deed of trust,
license, lease, agreement or other instrument or obligation to which the Company or any of its Subsidiaries is a party, or by which
they or any of their respective properties or assets may be bound, except (in the case of clause (y) above) for such violations,
conflicts, breaches or defaults which, either individually or in the aggregate, would not reasonably be expected to have a Material
Adverse Effect on the Company.
(c) The
Board of Directors of Company Bank has adopted the Bank Merger Agreement. The Company, as the sole shareholder of Company
Bank, has approved the Bank Merger Agreement, and the Bank Merger Agreement has been duly executed by Company Bank.
3.4 Consents
and Approvals. Except for (a) the filing of applications, filings and notices, as applicable, with NASDAQ, (b) the
filing of applications, filings and notices, as applicable, with the Federal Reserve Board and approval of such applications, filings
and notices, (c) the filing of applications, filings and notices, as applicable, with the Office of the Comptroller of the Currency
(the “OCC”), and approval of such applications, filings and notices, (d) the filing of applications, filings
and notices, as applicable, with the Department of Banking and Insurance of the State of New Jersey and where appropriate, with
the Commissioner of the Department of Banking and Insurance of the State of New Jersey (collectively, the “NJ Department”)
in connection with the Bank Merger, and approval of such applications, filings and notices, (e) the filing with the Securities
and Exchange Commission (the “SEC”) of (i) any filings that are necessary under applicable requirements of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), including the filing of a joint proxy statement
in definitive form relating to the meetings of the Company’s and Parent’s shareholders to be held in connection with
this Agreement and the transactions contemplated hereby (including any amendments or supplements thereto, the “Joint Proxy
Statement”), and (ii) the registration statement on Form S-4 in which the Joint Proxy Statement will be included as a
prospectus, to be filed with the SEC by Parent in connection with the transactions contemplated by this Agreement (the “S-4”)
and declaration of effectiveness of the S-4, (f) the filing of the Articles of Merger with the SDAT pursuant to the MGCL, (g) the
filing of the Second-Step Merger Certificates with the Delaware Secretary and the SDAT in accordance with the DGCL and the MGCL,
respectively, (i) the filing of the Bank Merger Certificate and (h) such filings and approvals as are required to be made or obtained
under the securities or “Blue Sky” laws of various states in connection with the issuance of shares of Parent Common
Stock pursuant to this Agreement and the approval of the listing of such Parent Common Stock on the NASDAQ, no consents or approvals
of or filings or registrations with any court, administrative agency or commission or other governmental authority or instrumentality
or SRO (each a “Governmental Entity”) are necessary in connection with (A) the execution and delivery by the
Company of this Agreement or (B) the consummation by the Company of the Integrated Mergers and the other transactions contemplated
hereby (including the Bank Merger).
3.5 Reports. The
Company and each of its Subsidiaries have timely filed all reports, registrations and statements, together with any amendments
required to be made with respect thereto, that they were required to file since January 1, 2013 with (a) any state regulatory authority,
including the NJ Department, (b) the SEC, (c) the Federal Reserve Board, (d) the FDIC, (e) the OCC, and (f) any self-regulatory
organization (an “SRO”) ((a) – (f), as applicable, and collectively “Regulatory Agencies”),
including, without limitation, any report, registration or statement required to be filed pursuant to the laws, rules or regulations
of the United States, any state, any foreign entity, or any Regulatory Agency, and have paid in full all fees and assessments due
and payable in connection therewith, except where the failure to file such report, registration or statement or to pay such fees
and assessments, either individually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect on
the Company. Except as set forth on Section 3.5 of the Company Disclosure Schedule and for normal
examinations conducted by a Regulatory
Agency in the ordinary course of business of the Company and its Subsidiaries, (i) no Regulatory Agency has initiated or has pending
any proceeding or, to the knowledge of the Company, investigation into the business or operations of the Company or any of its
Subsidiaries since January 1, 2013, except where such proceedings or investigation would not reasonably be expected to be, either
individually or in the aggregate, material to the Company and its Subsidiaries, taken as a whole, (ii) there is no unresolved violation,
criticism, or exception by any Regulatory Agency with respect to any report or statement relating to any examinations or inspections
of the Company or any of its Subsidiaries and (iii) there has been no formal or informal inquiries by, or disagreements or disputes
with, any Regulatory Agency with respect to the business, operations, policies or procedures of the Company or any of its Subsidiaries
since January 1, 2013, in each case, which would reasonably be expected to have, either individually or in the aggregate, a Material
Adverse Effect on the Company. The Company and its Subsidiaries have fully resolved all “matters requiring attention,”
“matters requiring immediate attention” or similar items as identified by any such Governmental Entity.
3.6 Financial
Statements.
(a) The
financial statements of the Company and its Subsidiaries included (or incorporated by reference) in the Company Reports (including
the related notes, where applicable) (i) have been prepared from, and are in accordance with, the books and records of the Company
and its Subsidiaries, (ii) fairly present in all material respects the consolidated results of operations, cash flows, changes
in shareholders’ equity and consolidated financial position of the Company and its Subsidiaries for the respective fiscal
periods or as of the respective dates therein set forth (subject in the case of unaudited statements to year-end audit adjustments
normal in nature and amount), (iii) complied, as of their respective dates of filing with the SEC, in all material respects with
applicable accounting requirements and with the published rules and regulations of the SEC with respect thereto, and (iv) have
been prepared in accordance with GAAP consistently applied during the periods involved, except, in each case, as indicated in such
statements or in the notes thereto. The books and records of the Company and its Subsidiaries have been, and are being,
maintained in all material respects in accordance with GAAP and any other applicable legal and accounting requirements and reflect
only actual transactions. Crowe Horwath LLP has not resigned (or informed the Company that it intends to resign) or
been dismissed as independent public accountants of the Company as a result of or in connection with any disagreements with the
Company on a matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure.
(b) Except
as would not reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect on the Company,
neither the Company nor any of its Subsidiaries has any liability of any nature whatsoever (whether absolute, accrued, contingent
or otherwise and whether due or to become due), except for those liabilities that are reflected or reserved against on the consolidated
balance sheet of the Company included in its Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2015 (including
any notes thereto) and for liabilities incurred in the ordinary course of business consistent with past practice since September
30, 2015, or in connection with this Agreement and the transactions contemplated hereby.
(c) The
records, systems, controls, data and information of the Company and its Subsidiaries are recorded, stored, maintained and operated
under means (including any electronic, mechanical or photographic process, whether computerized or not) that are under the exclusive
ownership and direct control of the Company or its Subsidiaries or their accountants (including all means of access thereto and
therefrom), except for any non-exclusive ownership and non-direct control that would not reasonably be expected to have a Material
Adverse Effect on the Company. The Company (x) has implemented and maintains disclosure controls and procedures (as
defined in Rule 13a-15(e) under the Exchange Act) to ensure that material information relating to the Company, including its Subsidiaries,
is made known to the chief executive officer and the chief financial officer of the Company by others within those entities as
appropriate to allow timely decisions regarding required disclosures and to make the certifications required by the Exchange Act
and Sections 302 and 906 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), and (y) has disclosed,
based on its most recent evaluation prior to the date hereof, to the Company’s outside auditors and the audit committee of
the Company’s Board of Directors (i) any significant deficiencies and material weaknesses in the design or operation of internal
control over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) which are reasonably likely to adversely affect
the Company’s ability to record, process, summarize and report financial information, and (ii) any fraud, whether or not
material, that involves management or other employees who have a significant role in the Company’s internal controls over
financial reporting. These disclosures were made in writing by management to the Company’s auditors and audit
committee and a copy has previously been made available to Parent. There is no reason to believe that the Company’s
outside auditors and its chief executive officer and chief financial officer will not be able to give the certifications and attestations
required pursuant to the rules and regulations adopted pursuant to Section 404 of the Sarbanes-Oxley Act, without qualification,
when next due.
(d) Since
January 1, 2013, (i) neither the Company nor any of its Subsidiaries, nor, to the knowledge of the Company, any director, officer,
auditor, accountant or representative of the Company or any of its Subsidiaries, has received or otherwise had or obtained knowledge
of any material complaint, allegation, assertion or claim, whether written or oral, regarding the accounting or auditing practices,
procedures, methodologies or methods (including with respect to loan loss reserves, write-downs, charge-offs and accruals) of the
Company or any of its Subsidiaries or their respective internal accounting controls, including any material complaint, allegation,
assertion or claim that the Company or any of its Subsidiaries has engaged in questionable accounting or auditing practices, and
(ii) no attorney representing the Company or any of its Subsidiaries, whether or not employed by the Company or any of its Subsidiaries,
has reported evidence of a material violation of securities laws, breach of fiduciary duty or similar violation by the Company
or any of its officers, directors, employees or agents to the Board of Directors of the Company or any committee thereof or to
the knowledge of the Company, to any director or officer of the Company.
3.7 Broker’s
Fees. With the exception of the engagement of Raymond James & Associates, Inc., neither the Company nor any
Company Subsidiary nor any of their respective officers or directors has employed any broker, finder or financial advisor or incurred
any liability for any broker’s fees, commissions or finder’s fees in connection with the Integrated Mergers or related
transactions contemplated by this Agreement. The Company has disclosed to Parent as of the date hereof the aggregate
fees provided for in connection with the engagement by the
Company of Raymond James & Associates,
Inc., related to the Integrated Mergers and the other transactions contemplated hereby.
3.8 Absence
of Certain Changes or Events.
(a) Since
December 31, 2014, no event or events have occurred that have had or would reasonably be expected to have, either individually
or in the aggregate, a Material Adverse Effect on the Company.
(b) Since
December 31, 2014, except with respect to (i) matters set forth on Section 3.8(b) of the Company Disclosure Schedule, (ii)
the transactions contemplated hereby and (iii) the acquisition by the Company of Colonial Financial Services, Inc., the Company
and its Subsidiaries have carried on their respective businesses in all material respects in the ordinary course.
3.9 Legal
Proceedings.
(a) Neither
the Company nor any of its Subsidiaries is a party to any, and there are no pending or, to the Company’s knowledge, threatened,
legal, administrative, arbitral or other proceedings, claims, actions or governmental or regulatory investigations (i) of any material
nature against the Company or any of its Subsidiaries or any of their current or former directors or executive officers, other
than those set forth on Section 3.9(a)(i) of the Company Disclosure Schedule or (ii) challenging the validity or propriety of the
transactions contemplated by this Agreement.
(b) There
is no injunction, order, judgment, decree, or regulatory restriction imposed upon the Company, any of its Subsidiaries or the assets
of the Company or any of its Subsidiaries (or that, upon consummation of the Integrated Mergers, would apply to the Surviving Corporation
or any of its affiliates), that would reasonably be expected to be material to the Company and its Subsidiaries, taken as a whole.
3.10 Taxes
and Tax Returns.
(a) Each
of the Company and its Subsidiaries has duly and timely filed or caused to be filed (giving effect to all applicable extensions)
all material Tax Returns required to be filed by any of them, and all such Tax Returns are true, correct, and complete in all material
respects.
(b) All
material Taxes of the Company and its Subsidiaries that are due have been fully and timely paid or adequate reserves therefor have
been made on the financial statements of the Company and its Subsidiaries included (or incorporated by reference) in the Company
Reports (including the related notes, where applicable). Each of the Company and its Subsidiaries has withheld and paid
to the relevant Governmental Entity on a timely basis all material Taxes required to have been withheld and paid in connection
with amounts paid or owing to any person.
(c) No
claim has been made in writing by any Governmental Entity in a jurisdiction where the Company or any of its Subsidiaries does not
file Tax Returns that the Company or such subsidiary is or may be subject to taxation by that jurisdiction.
(d) There
are no material Liens for Taxes on any of the assets of the Company or any of its Subsidiaries.
(e) Neither
the Company nor any of its Subsidiaries has received written notice of assessment or proposed assessment in connection with any
material amount of Taxes, and there are no threatened in writing or pending disputes, claims, audits, examinations, investigations,
or other proceedings regarding any material Tax of the Company and its Subsidiaries or the assets of the Company and its Subsidiaries
which have not been paid, settled or withdrawn or for which adequate reserves have not been established.
(f) Neither
the Company nor any of its Subsidiaries will be required to include any item of income in, or exclude any item of deduction from,
taxable income for any taxable year (or portion thereof) ending after the Closing Date as a result of any (i) intercompany transaction
or excess loss account described in Treasury regulations promulgated under Section 1502 of the Code (or any corresponding or similar
provision of state, local, or non- U.S. Tax law), (ii) installment sale or open transaction made on or prior to the Closing Date
or (iii) prepaid amount received on or prior to the Closing Date.
(g) Neither
the Company nor any of its Subsidiaries is a party to or is bound by any Tax sharing, allocation or indemnification agreement or
arrangement (other than such an agreement or arrangement exclusively between or among the Company and its Subsidiaries). Neither
the Company nor any of its Subsidiaries (i) has been a member of an affiliated group filing a consolidated federal income Tax Return
(other than a group of which the Company was the common parent) or (ii) has any liability for the Taxes of any person (other than
the Company or any of its Subsidiaries) arising from the application of Treasury regulation Section 1.1502-6, or any similar provision
of state, local or foreign law, as a transferee or successor, by contract or otherwise.
(h) Neither
the Company nor any of its Subsidiaries has distributed stock to another Person, or has had its stock distributed by another Person
during the two-year period ending on the date hereof that was intended to be governed in whole or in part by Section 355 of the
Code.
(i) Neither
the Company nor any of its Subsidiaries has engaged in any “reportable transaction” within the meaning of Treasury
Regulation section 1.6011-4(b)(1).
(j) Neither
the Company nor any of its Subsidiaries has undergone an “ownership change” within the meaning of Section 382(g) of
the Code within the past five years.
(k) Neither
the Company nor any of its Subsidiaries has taken any action, or knows of any fact or circumstance, that could reasonably be expected
to prevent the Integrated Mergers, taken together, from being treated as an integrated transaction that qualifies as a “reorganization”
within the meaning of Section 368(a) of the Code.
(l) As
used in this Agreement, the term “Tax” or “Taxes” means all U.S. federal, state and local,
and foreign taxes, fees assessments or other charges of a similar nature (whether imposed directly or through withholding), including
any interest, additions to tax or penalties related thereto.
(m) As
used in this Agreement, the term “Tax Return” means any return, declaration, report, claim for refund, or information
return or statement relating to Taxes, including any schedule or attachment thereto, and including any amendment thereof, supplied
or required to be supplied to a Governmental Entity.
3.11 Employees.
(a) Section
3.11(a) of the Company Disclosure Schedule lists all Company Benefit Plans. For purposes of this Agreement, “Company
Benefit Plans” mean all employee benefit plans (as defined in Section 3(3) of the Employee Retirement Income Security
Act of 1974, as amended (“ERISA”)), whether or not subject to ERISA, whether funded or unfunded, and all pension,
benefit, retirement, bonus, stock option, stock purchase, restricted stock, stock-based, performance award, phantom equity, incentive,
deferred compensation, retiree medical or life insurance, supplemental retirement, severance, retention, employment, consulting,
termination, change in control, salary continuation, accrued leave, sick leave, vacation, paid time off, health, medical, disability,
life, accidental death and dismemberment, insurance, welfare, fringe benefit and other similar plans, programs, policies, practices
or arrangements or other contracts or agreements (and any amendments thereto) to or with respect to which the Company or any Subsidiary
or any trade or business of the Company or any of its Subsidiaries, whether or not incorporated, all of which together with the
Company would be deemed a “single employer” within the meaning of Section 4001 of ERISA (a “Company ERISA
Affiliate”), is a party or has any current or future obligation or that are sponsored, maintained, contributed to or
required to be contributed to by the Company or any of its Subsidiaries or any Company ERISA Affiliate for the benefit of any current
or former employee, officer, director, consultant or independent contractor (or any spouse or dependent of such individual) of
the Company or any of its Subsidiaries or any Company ERISA Affiliate.
(b) The
Company has heretofore made available to Parent true, correct and complete copies of the following documents with respect to each
of the Company Benefit Plans, to the extent applicable, (i) all plans and trust agreements, (ii) all summary plan descriptions,
amendments, modifications or material supplements to any Company Benefit Plan, (iii) where any Company Benefit Plan has not been
reduced to writing, a written summary of all the material plan terms, (iii) the annual report (Form 5500), if any, filed with
the Internal Revenue Service (the “IRS”) for the last three (3) plan years and summary annual reports, with
schedules and financial statements attached, (iv) the most recently received IRS determination letter, if any, relating to
any Company Benefit Plan, (v) the most recently prepared actuarial report for each Company Benefit Plan (if applicable) for
each of the last three (3) years and (vi) copies of material notices, letters or other correspondence with the IRS, U.S. Department
of Labor (the “DOL”) or Pension Benefit Guarantee Corporation (the “PBGC”).
(c) Except
as set forth in Section 3.11(c) of the Company Disclosure Schedule, each Company Benefit Plan has been established, operated
and administered in all
material respects in accordance with
its terms and the requirements of all applicable laws, including ERISA and the Code. Neither the Company nor any of
its Subsidiaries has taken any action to take corrective action or made a filing under any voluntary correction program of the
IRS, the DOL or any other Governmental Entity with respect to any Company Benefit Plan, and neither the Company nor any of its
Subsidiaries has any knowledge of any plan defect that would qualify for correction under any such program.
(d) Section
3.11(d) of the Company Disclosure Schedule identifies each Company Benefit Plan that is intended to be qualified under Section
401(a) of the Code (the “Company Qualified Plans”). The IRS has issued a favorable determination
letter with respect to each Company Qualified Plan and the related trust, which letter has not been revoked (nor has revocation
been threatened), and, to the knowledge of the Company, there are no existing circumstances and no events have occurred that could
adversely affect the qualified status of any Company Qualified Plan or the exempt status of the related trust or increase the costs
relating thereto. No trust funding any Company Benefit Plan is intended to meet the requirements of Section 501(c)(9)
of the Code.
(e) Each
Company Benefit Plan that is subject to Section 409A of the Code has been administered and documented in compliance with the requirements
of Section 409A of the Code, except where any non-compliance has not and cannot reasonably be expected to result in material liability
to the Company or any of its Subsidiaries or any employee of the Company or any of its Subsidiaries.
(f) With
respect to each Company Benefit Plan that is subject to Title IV or Section 302 of ERISA or Sections 412, 430 or 4971 of the Code:
(i) no such plan is in “at-risk” status for purposes of Section 430 of the Code, (ii) the present value of accrued
benefits under such Company Benefit Plan, based upon the actuarial assumptions used for funding purposes in the most recent actuarial
report prepared by such Company Benefit Plan’s actuary with respect to such Company Benefit Plan, did not, as of its latest
valuation date, exceed the then current fair market value of the assets of such Company Benefit Plan allocable to such accrued
benefits, (iii) no reportable event within the meaning of Section 4043(c) of ERISA for which the 30-day notice requirement has
not been waived has occurred, (iv) all premiums to the PBGC have been timely paid in full, (v) no liability (other than for premiums
to the PBGC) under Title IV of ERISA has been or is expected to be incurred by the Company or any of its Subsidiaries, and (vi)
the PBGC has not instituted proceedings to terminate any such Company Benefit Plan.
(g) Except
as set forth in Section 3.11(g) of the Company Disclosure Schedule, none of the Company, its Subsidiaries nor any Company
ERISA Affiliate has, at any time during the last six years, contributed to or been obligated to contribute to any plan that is
a “multiemployer plan” within the meaning of Section 4001(a)(3) of ERISA (a “Multiemployer Plan”)
or a plan that has two or more contributing sponsors at least two of whom are not under common control, within the meaning of Section
4063 of ERISA (a “Multiple Employer Plan”), and none of the Company and its Subsidiaries nor any Company ERISA
Affiliate has incurred any liability to a Multiemployer Plan or Multiple Employer Plan as a result of a complete or partial withdrawal
(as those terms are defined in Part 1 of Subtitle E of Title IV of ERISA) from a Multiemployer Plan or Multiple Employer Plan.
(h) Except
as set forth in Section 3.11(h) of the Company Disclosure Schedule, neither the Company nor any of its Subsidiaries sponsors
has sponsored or has any obligation with respect to any employee benefit plan that provides for any post-employment or post-retirement
health or medical or life insurance benefits for retired, former or current employees or beneficiaries or dependents thereof, except
as required by Section 4980B of the Code.
(i) All
contributions required to be made to any Company Benefit Plan by applicable law or by any plan document or other contractual undertaking,
and all premiums due or payable with respect to insurance policies funding any Company Benefit Plan, for any period through the
date hereof, have been timely made or paid in full or, to the extent not required to be made or paid on or before the date hereof,
have been fully reflected on the books and records of the Company.
(j) Except
as set forth in Section 3.11(j) of the Company Disclosure Schedule, there are no pending or threatened claims (other than
claims for benefits in the ordinary course), lawsuits or arbitrations that have been asserted or instituted, and, to the Company’s
knowledge, no set of circumstances exists that may reasonably be expected to give rise to a claim or lawsuit, against the Company
Benefit Plans, any fiduciaries thereof with respect to their duties to the Company Benefit Plans or the assets of any of the trusts
under any of the Company Benefit Plans, that could reasonably be expected to result in any material liability of the Company or
any of its Subsidiaries to the PBGC, the IRS, the DOL, any Multiemployer Plan, a Multiple Employer Plan, any participant in any
Company Benefit Plan, or any other party.
(k) To
the knowledge of the Company, none of the Company and its Subsidiaries nor any Company ERISA Affiliate nor any other person, including
any fiduciary, has engaged in any “prohibited transaction” (as defined in Section 4975 of the Code or Section 406 of
ERISA), which could subject any of the Company Benefit Plans or their related trusts, the Company, any of its Subsidiaries, any
Company ERISA Affiliate or any person that the Company or any of its Subsidiaries has an obligation to indemnify, to any material
tax or penalty imposed under Section 4975 of the Code or Section 502 of ERISA.
(l) Except
as disclosed in Section 3.11(l) of the Company Disclosure Schedule, neither the execution and delivery of this Agreement
nor the consummation of the transactions contemplated hereby will (either alone or in conjunction with any other event) result
in, cause the vesting, exercisability or delivery of, or increase in the amount or value of, any payment, compensation (including
stock or stock-based), right or other benefit to any employee, officer, director, independent contractor, consultant or other service
provider of the Company or any of its Subsidiaries, or result in any limitation on the right of the Company or any of its Subsidiaries
to amend, merge, terminate or receive a reversion of assets from any Company Benefit Plan or related trust. Without
limiting the generality of the foregoing, no amount paid or payable (whether in cash, in property, or in the form of benefits)
by the Company or any of its Subsidiaries in connection with the transactions contemplated hereby (either solely as a result thereof
or as a result of such transactions in conjunction with any other event) will be an “excess parachute payment” within
the meaning of Section 280G of the Code. Neither the Company nor any of its Subsidiaries maintains or contributes to
a rabbi trust or similar funding vehicle, and the
transactions contemplated by this Agreement
will not cause or require the Company or any of its affiliates to establish or make any contribution to a rabbi trust or similar
funding vehicle.
(m) No
Company Benefit Plan provides for the gross-up or reimbursement of Taxes under Section 409A or 4999 of the Code, or otherwise. The
Company has made available to Parent true, correct and complete copies of Section 280G calculations (whether or not final) with
respect to any disqualified individual in connection with the transactions contemplated hereby.
(n) Neither
the Company nor its Subsidiaries remain subject to any compensation-related limitations or restrictions imposed by or related to
Section 111 of the Emergency Economic Stabilization Act of 2008, as amended.
(o) Except
as set forth in Section 3.11(o) of the Company Disclosure Schedule, there are no pending or, to the Company’s knowledge,
threatened material labor grievances or material unfair labor practice claims or charges against the Company or any of its Subsidiaries,
or any strikes or other material labor disputes against the Company or any of its Subsidiaries. Neither the Company
nor any of its Subsidiaries are party to or bound by any collective bargaining or similar agreement with any labor organization,
or work rules or practices agreed to with any labor organization or employee association applicable to employees of the Company
or any of its Subsidiaries and, to the knowledge of the Company, there are no organizing efforts by any union or other group seeking
to represent any employees of the Company or any of its Subsidiaries and no employees of the Company or any of its Subsidiaries
are represented by any labor organization.
(p) To
the knowledge of the Company, and except as could not reasonably be expected to result in material harm to the Company or any of
its Subsidiaries, no current or former employee or independent contractor of the Company or any of its Subsidiaries is in violation
in any material respect of any term of any restrictive covenant obligation, including any non-compete, non-solicit, non-interference,
non-disparagement or confidentiality obligation, (“Restrictive Covenant”) or any employment or consulting contract,
common law nondisclosure obligation, fiduciary duty, or other obligation: (i) to the Company or any of its Subsidiaries or (ii)
to a former employer or engager of any such individual relating (A) to the right of any such individual to work for the Company
or any of its Subsidiaries or (B) to the knowledge or use of trade secrets or proprietary information.
(q) To
the knowledge of the Company, no employee of the Company or any of its Subsidiaries with a base salary in excess of $150,000 intends
to terminate his or her employment relationship.
3.12 SEC
Reports. The Company has previously made available to Parent an accurate and complete copy of each communication
mailed by the Company to its shareholders since December 31, 2013. No such communication or any final registration statement,
prospectus, report, schedule and definitive proxy statement filed with or furnished to the SEC since December 31, 2013 by the Company
pursuant to the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act (the “Company
Reports”), as of the date thereof (and, in the case of registration statements and proxy statements, on the dates of
effectiveness
and the dates of the relevant meetings,
respectively), contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein
or necessary in order to make the statements therein, in light of the circumstances in which they were made, not misleading, except
that information filed or furnished as of a later date (but before the date of this Agreement) shall be deemed to modify information
as of an earlier date. Since December 31, 2013, as of their respective dates, all the Company Reports filed under the
Securities Act and the Exchange Act complied in all material respects with the published rules and regulations of the SEC with
respect thereto. None of the Company Subsidiaries is required to file periodic reports with the SEC pursuant to Section
13 or 15(d) of the Exchange Act. As of the date of this Agreement, no executive officer of the Company has failed in
any respect to make the certifications required of him or her under Section 302 or 906 of the Sarbanes-Oxley Act. As
of the date of this Agreement, there are no outstanding comments from or unresolved issues raised by the SEC with respect to any
of the Company Reports.
3.13 Compliance
with Applicable Law. The Company and each of its Subsidiaries hold, and have at all times since December 31, 2013,
held, all licenses, franchises, permits and authorizations necessary for the lawful conduct of their respective businesses and
ownership of their respective properties, rights and assets under and pursuant to each (and have paid in full all fees and assessments
due and payable in connection therewith), except where neither the cost of failure to hold nor the cost of obtaining and holding
such license, franchise, permit or authorization (nor the failure to pay any fees or assessments) would, either individually or
in the aggregate, reasonably be expected to have a Material Adverse Effect on the Company, and to the knowledge of the Company
no suspension or cancellation of any such necessary license, franchise, permit or authorization is threatened. The Company
and each of its Subsidiaries have complied in all material respects with and are not in material default or violation under any
applicable law, statute, order, rule, regulation, policy and/or guideline of any Governmental Entity relating to the Company or
any of its Subsidiaries, including without limitation all laws related to data protection or privacy, the USA Patriot Act, the
Bank Secrecy Act, the Equal Credit Opportunity Act and Regulation B, the Fair Housing Act, the Community Reinvestment Act, the
Fair Credit Reporting Act, the Truth in Lending Act and Regulation Z, the Home Mortgage Disclosure Act, the Fair Debt Collection
Practices Act, the Electronic Fund Transfer Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, any regulations
promulgated by the Consumer Financial Protection Bureau, the Interagency Policy Statement on Retail Sales of Nondeposit Investment
Products, the SAFE Mortgage Licensing Act of 2008, the Real Estate Settlement Procedures Act and Regulation X, and any other law
relating to bank secrecy, discriminatory lending, financing or leasing practices, money laundering prevention, Sections 23A and
23B of the Federal Reserve Act, the Sarbanes-Oxley Act, the Federal Deposit Insurance Corporation Improvement Act, and all agency
requirements relating to the origination, sale and servicing of mortgage and consumer loans. Company Bank has a Community Reinvestment
Act rating of “satisfactory” or better. Without limitation, none of the Company, or its Subsidiaries, or
to the knowledge of the Company, any director, officer, employee, agent or other person acting on behalf of the Company or any
of its Subsidiaries has, directly or indirectly, (a) used any funds of the Company or any of its Subsidiaries for unlawful contributions,
unlawful gifts, unlawful entertainment or other expenses relating to political activity, (b) made any unlawful payment to foreign
or domestic governmental officials or employees or to foreign or domestic political parties or campaigns from funds of the Company
or any of its Subsidiaries, (c) violated any provision that would result in the violation of the Foreign
Corrupt Practices Act of 1977, as amended,
or any similar law, (d) established or maintained any unlawful fund of monies or other assets of the Company or any of its Subsidiaries,
(e) made any fraudulent entry on the books or records of the Company or any of its Subsidiaries, or (f) made any unlawful bribe,
unlawful rebate, unlawful payoff, unlawful influence payment, unlawful kickback or other unlawful payment to any person, private
or public, regardless of form, whether in money, property or services, to obtain favorable treatment in securing business to obtain
special concessions for the Company or any of its Subsidiaries, to pay for favorable treatment for business secured or to pay for
special concessions already obtained for the Company or any of its Subsidiaries, or is currently subject to any United States sanctions
administered by the Office of Foreign Assets Control of the United States Treasury Department.
3.14 Certain
Contracts.
(a) Except
as set forth in Section 3.14(a) of the Company Disclosure Schedule, as of the date hereof, neither the Company nor any of
its Subsidiaries is a party to or bound by any contract, arrangement, commitment or understanding (whether written or oral) (i)
with respect to the employment of any directors, officers, employees, independent contractors or consultants other than in the
ordinary course of business consistent with past practice, (ii) which, upon the execution or delivery of this Agreement, shareholder
adoption of this Agreement or the consummation of the transactions contemplated by this Agreement will (either alone or upon the
occurrence of any additional acts or events) result in any payment (whether of severance pay or otherwise) becoming due from Parent,
the Company, the Surviving Corporation, or any of their respective Subsidiaries to any officer or employee thereof, (iii) which
is a “material contract” (as such term is defined in Item 601(b)(10) of Regulation S-K of the SEC), (iv) which contains
a non-compete or client or customer non-solicit requirement or any other provision that materially restricts the conduct of any
line of business by the Company or any of its affiliates or upon consummation of the Integrated Mergers will materially restrict
the ability of the Surviving Corporation or any of its affiliates to engage in any line of business, (v) with or to a labor union
or guild (including any collective bargaining agreement), (vi) any of the benefits of which contract, arrangement, commitment or
understanding (including any stock option plan, stock appreciation rights plan, restricted stock plan or stock purchase plan) will
be increased, or the vesting of the benefits of which will be accelerated, by the occurrence of the execution and delivery of this
Agreement, shareholder adoption of this Agreement or the consummation of any of the transactions contemplated by this Agreement,
or the value of any of the benefits of which will be calculated on the basis of any of the transactions contemplated by this Agreement,
(vii) that relates to the incurrence of indebtedness by the Company or any of its Subsidiaries (other than deposit liabilities,
trade payables, federal funds purchased, advances and loans from the FHLB and securities sold under agreements to repurchase, in
each case incurred in the ordinary course of business consistent with past practice) in the principal amount of $500,000 or more
including any sale and leaseback transactions, capitalized leases and other similar financing transactions, (viii) that grants
any right of first refusal, right of first offer or similar right with respect to any material assets, rights or properties of
the Company or its Subsidiaries, (ix) that is a consulting agreement or data processing, software programming or licensing contract
involving the payment of more than $100,000 per annum (other than any such contracts which are terminable by the Company or any
of its Subsidiaries on sixty (60) days or less notice without any required payment or other conditions, other than the condition
of notice), (x) which includes an indemnification obligation of the Company or any of its Subsidiaries with a maximum
potential liability in excess of $100,000
or (xi) which involves aggregate payments or receipts by or to the Company or any of its Subsidiaries in excess of $100,000 in
any twelve-month period, other than those terminable on sixty (60) days or less notice without payment by the Company or any Subsidiary
of the Company of any material penalty. Each contract, arrangement, commitment or understanding of the type described
in this Section 3.14(a), whether or not set forth in the Company Disclosure Schedule, is referred to herein as a “Company
Contract,” and neither the Company nor any of its Subsidiaries knows of, or has received notice of, any material violation
of the above by any of the other parties thereto.
(b) Each
Company Contract is valid and binding on the Company or one of its Subsidiaries, as applicable, and in full force and effect, except
as, either individually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect on the Company. The
Company and each of its Subsidiaries has in all material respects performed all obligations required to be performed by it under
each Company Contract. To the Company’s knowledge each third-party counterparty to each Company Contract has in
all material respects performed all obligations required to be performed by it under such Company Contract, and no event or condition
exists which constitutes or, after notice or lapse of time or both, will constitute, a material default on the part of the Company
or any of its Subsidiaries under any such Company Contract.
3.15 Agreements
with Regulatory Agencies. Except as set forth on Section 3.15 of the Company Disclosure Schedule, neither
the Company nor any of its Subsidiaries is subject to any cease-and-desist or other order or enforcement action issued by, or is
a party to any written agreement, consent agreement or memorandum of understanding with, or is a party to any commitment letter
or similar undertaking to, or is subject to any order or directive by, or has been ordered to pay any civil money penalty by, or
has been since January 1, 2013, a recipient of any supervisory letter from, or since January 1, 2013, has adopted any policies,
procedures or board resolutions at the request or suggestion of any Regulatory Agency or other Governmental Entity that currently
restricts in any material respect the conduct of its business or that in any material manner relates to its capital adequacy, its
ability to pay dividends, its credit or risk management policies, its management or its business (each, whether or not set forth
in the Company Disclosure Schedule, a “Company Regulatory Agreement”), nor has the Company or any of its Subsidiaries
been advised since January 1, 2013, by any Regulatory Agency or other Governmental Entity that it is considering issuing, initiating,
ordering, or requesting any such Company Regulatory Agreement. The Company and its Subsidiaries are in compliance in
all material respects with each Regulatory Agreement to which it is a party or is subject. The Company and its Subsidiaries
have not received any notice from any Governmental Entity indicating that the Company or its Subsidiaries is not in compliance
in any material respect with any Regulatory Agreement.
3.16 Risk
Management Instruments. Except as set forth in Section 3.16 of the Company Disclosure Schedule, all interest
rate swaps, caps, floors, option agreements, futures and forward contracts and other similar derivative transactions and risk management
arrangements (each, a “Derivative Contract”), whether entered into for the account of the Company, any of its
Subsidiaries or for the account of a customer of the Company or one of its Subsidiaries, were entered into in the ordinary course
of business and in accordance with applicable rules, regulations and policies of any Regulatory Agency and with counterparties
believed to be financially responsible
at the time and are legal, valid and binding obligations of the Company or one of its Subsidiaries enforceable in accordance with
their terms (except as may be limited by bankruptcy, insolvency, moratorium, reorganization or similar laws affecting the rights
of creditors generally and the availability of equitable remedies (the “Enforceability Exceptions”)), and are
in full force and effect. The Company and each of its Subsidiaries have duly performed in all material respects all
of their material obligations thereunder to the extent that such obligations to perform have accrued, and, to the Company’s
knowledge, there are no material breaches, violations or defaults or allegations or assertions of such by any party thereunder. Each
such Derivative Contract has been reflected in the books and records of the Company and such Subsidiaries in accordance with GAAP
consistently applied. Each Derivative Contract is evidenced by customary and appropriate documentation (including an
ISDA master agreement and long-form confirmation).
3.17 Environmental
Matters. Except as disclosed in Section 3.17 of the Company Disclosure Schedule, and except as would not
reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on the Company, the Company and its
Subsidiaries are in compliance, and have complied, with any federal, state or local law, regulation, order, decree, permit, authorization,
common law or agency requirement relating to: (a) the protection or restoration of the environment, health and safety as it relates
to hazardous substance exposure or natural resource damages, (b) the handling, use, presence, disposal, release or threatened release
of, or exposure to, any hazardous substance, or (c) noise, odor, wetlands, indoor air, pollution, contamination or any injury to
persons or property from exposure to any hazardous substance (collectively, “Environmental Laws”). There
are no legal, administrative, arbitral or other proceedings, claims or actions, or to the knowledge of the Company any private
environmental investigations or remediation activities or governmental investigations of any nature seeking to impose, or that
could reasonably be expected to result in the imposition, on the Company or any of its Subsidiaries of any liability or obligation
arising under any Environmental Law, pending or threatened against the Company, which liability or obligation would reasonably
be expected to have, either individually or in the aggregate, a Material Adverse Effect on the Company. To the knowledge
of the Company, there is no reasonable basis for any such proceeding, claim, action or governmental investigation that would impose
any liability or obligation that would reasonably be expected to have, either individually or in the aggregate, a Material Adverse
Effect on the Company. The Company is not subject to any agreement, order, judgment, decree, letter agreement or memorandum
of agreement by or with any court, governmental authority, regulatory agency or third party imposing any liability or obligation
with respect to the foregoing that would reasonably be expected to have, either individually or in the aggregate, a Material Adverse
Effect on the Company.
3.18 Investment
Securities and Commodities.
(a) Each
of the Company and its Subsidiaries has good title to all securities and commodities owned by it (except those sold under repurchase
agreements), free and clear of any Lien, except to the extent such securities or commodities are pledged in the ordinary course
of business to secure obligations of the Company or its Subsidiaries. Such securities and commodities are valued on
the books of the Company in accordance with GAAP in all material respects.
(b) The
Company and its Subsidiaries and their respective businesses employ investment, securities, commodities, risk management and other
policies, practices and procedures that the Company believes are prudent and reasonable in the context of such businesses. Prior
to the date of this Agreement, the Company has made available to Parent the material terms of such policies, practices and procedures.
3.19 Real
Property. Except as disclosed in Section 3.19 of the Company Disclosure Schedule, the Company and each Company
Subsidiary has good and marketable title to all the real property reflected in the latest audited balance sheet included in the
Company Reports as being owned by the Company or any such Company Subsidiary or acquired after the date thereof (except properties
sold or otherwise disposed of since the date thereof in the ordinary course of business) (the “Company Owned Properties”),
free and clear of all material Liens, except statutory Liens securing payments not yet due, Liens for real property Taxes not yet
due and payable, easements, rights of way, and other similar encumbrances that do not materially affect the value or use of the
properties or assets subject thereto or affected thereby or otherwise materially impair business operations at such properties
and such imperfections or irregularities of title or Liens as do not materially affect the value or use of the properties or assets
subject thereto or affected thereby or otherwise materially impair business operations at such properties (collectively, “Permitted
Encumbrances”), and is the lessee of all leasehold estates reflected in the latest audited financial statements included
in such Company Reports or acquired after the date thereof (except for leases that have expired by their terms since the date thereof)
(the “Company Leased Properties” and, collectively with the Company Owned Properties, the “Company
Real Property”), free and clear of all Liens of any nature whatsoever, except for Permitted Encumbrances, and is in possession
of the properties purported to be leased thereunder, and each such lease is valid without default thereunder by the lessee or,
to the Company’s knowledge, the lessor. There are no pending or, to the knowledge of the Company, threatened condemnation
proceedings against the Company Real Property.
3.20 Intellectual
Property. The Company and each of its Subsidiaries owns, or is licensed to use (in each case, free and clear of
any material Liens), all Intellectual Property necessary for the conduct of its business as currently conducted. Except
as would not reasonably be expected to have a Material Adverse Effect on the Company: (i) (A) the use of any Intellectual Property
by the Company and its Subsidiaries does not infringe, misappropriate or otherwise violate the rights of any person and is in accordance
with any applicable license pursuant to which the Company or any Company Subsidiary acquired the right to use any Intellectual
Property, and (B) no person has asserted to the Company that the Company or any of its Subsidiaries has infringed, misappropriated
or otherwise violated the Intellectual Property rights of such person, (ii) no person is challenging, infringing on or otherwise
violating any right of the Company or any of its Subsidiaries with respect to any Intellectual Property owned by and/or licensed
to the Company or its Subsidiaries, and (iii) neither the Company nor any Company Subsidiary has received any notice of any pending
claim with respect to any Intellectual Property owned by the Company or any Company Subsidiary, and the Company and its Subsidiaries
have taken commercially reasonable actions to avoid the abandonment, cancellation or unenforceability of all Intellectual Property
owned or licensed, respectively, by the Company and its Subsidiaries. For purposes of this Agreement, “Intellectual
Property” means trademarks, service marks, brand names, internet domain names, logos, symbols, certification marks, trade
dress and other indications of origin, the goodwill associated with the
foregoing and registrations in any jurisdiction
of, and applications in any jurisdiction to register, the foregoing, including any extension, modification or renewal of any such
registration or application; inventions, discoveries and ideas, whether patentable or not, in any jurisdiction; patents, applications
for patents (including divisions, continuations, continuations in part and renewal applications), all improvements thereto, and
any renewals, extensions or reissues thereof, in any jurisdiction; nonpublic information, trade secrets and know-how, including
processes, technologies, protocols, formulae, prototypes and confidential information and rights in any jurisdiction to limit the
use or disclosure thereof by any person; writings and other works, whether copyrightable or not and whether in published or unpublished
works, in any jurisdiction; and registrations or applications for registration of copyrights in any jurisdiction, and any renewals
or extensions thereof; and any similar intellectual property or proprietary rights.
3.21 Related
Party Transactions. Except as set forth in Section 3.21 of the Company Disclosure Schedule, there are no
transactions or series of related transactions, agreements, arrangements or understandings, nor are there any currently proposed
transactions or series of related transactions, between the Company or any of its Subsidiaries, on the one hand, and any current
or former director or “executive officer” (as defined in Rule 3b-7 under the Exchange Act) of the Company or any of
its Subsidiaries or any person who beneficially owns (as defined in Rules 13d-3 and 13d-5 of the Exchange Act) 5% or more of the
outstanding Company Common Stock (or any of such person’s immediate family members or affiliates), on the other hand, except
those of a type available to employees of the Company or its Subsidiaries generally.
3.22 Takeover
Statutes. No “moratorium,” “fair price,” “business combination,” “control
share acquisition,” “interested stockholder”, “affiliate transactions”, or similar provision of any
state anti-takeover (any such laws, “Takeover Statutes”) is applicable to this Agreement, the Integrated Mergers
or any of the other transactions contemplated by this Agreement under the MGCL or federal law.
3.23 Opinion. Prior
to the execution of this Agreement, the Board of Directors of the Company has received an opinion (which, if initially rendered
verbally, has been or will be confirmed by a written opinion, dated the same date) of Raymond James & Associates, Inc. to the
effect that, as of the date of such opinion, and based upon and subject to the factors, assumptions, and limitations set forth
therein, the Merger Consideration pursuant to this Agreement is fair from a financial point of view to the holders of Company Common
Stock. Such opinion has not been amended or rescinded as of the date of this Agreement.
3.24 Company
Information. The information relating to the Company and its Subsidiaries which is provided by the Company or its
representatives for inclusion in the Joint Proxy Statement and the S-4, or in any other document filed with any other Regulatory
Agency in connection herewith, will not contain any untrue statement of a material fact or omit to state a material fact necessary
to make the statements therein, in light of the circumstances in which they are made, not misleading. The Joint Proxy
Statement (except for such portions thereof that relate only to Parent or any of its Subsidiaries) will comply in all material
respects with the provisions of the Exchange Act and the rules and regulations thereunder.
3.25 Loan
Portfolio.
(a) As
of the date hereof, except as set forth in Section 3.25(a) of the Company Disclosure Schedule, neither the Company nor any
of its Subsidiaries is a party to any written or oral (i) loan, loan agreement, note or borrowing arrangement (including leases,
credit enhancements, commitments, guarantees and interest-bearing assets) (collectively, “Loans”) in which the
Company or any Subsidiary of the Company is a creditor which as of September 30, 2015, had an outstanding balance of $100,000 or
more and under the terms of which the obligor was, as of September 30, 2015, over 90 days or more delinquent in payment of principal
or interest, or (ii) Loans with any director, executive officer or 5% or greater shareholder of the Company or any of its Subsidiaries,
or to the knowledge of the Company, any affiliate of any of the foregoing. Set forth in Section 3.25(a) of the
Company Disclosure Schedule is a true, correct and complete list of (A) all of the Loans of the Company and its Subsidiaries that,
as of September 30, 2015, were classified by the Company as “Other Loans Specially Mentioned,” “Special Mention,”
“Substandard,” “Doubtful,” “Loss,” “Classified,” “Criticized,” “Credit
Risk Assets,” “Concerned Loans,” “Watch List” or words of similar import, together with the principal
amount of and accrued and unpaid interest on each such Loan and the identity of the borrower thereunder, together with the aggregate
principal amount of and accrued and unpaid interest on such Loans, by category of Loan (e.g., commercial, consumer, etc.), together
with the aggregate principal amount of such Loans by category and (B) each asset of the Company or any of its Subsidiaries that,
as of September 30, 2015, is classified as “Other Real Estate Owned” and the book value thereof.
(b) Set
forth in Section 3.25(b) of the Company Disclosure Schedule is a true, correct and complete list, as of September 30, 2015,
of each Loan of the Company or any of its Subsidiaries that is structured as a participation interest in a Loan originated by another
person (each, a “Loan Participation”), including with respect to each such Loan Participation, the originating
lender of the related Loan, the outstanding principal balance of the related Loan, the amount of the outstanding principal balance
represented by the Loan Participation and the identity of the borrower of the related Loan.
(c) Except
as would not reasonably be expected to have a Material Adverse Effect on the Company, each Loan of the Company and its Subsidiaries
(i) is evidenced by notes, agreements or other evidences of indebtedness that are true, genuine and what they purport to be, (ii)
to the extent carried on the books and records of the Company and its Subsidiaries as secured Loans, has been secured by valid
charges, mortgages, pledges, security interests, restrictions, claims, liens or encumbrances, as applicable, which have been perfected
and (iii) is the legal, valid and binding obligation of the obligor named therein, enforceable in accordance with its terms, subject
to the Enforceability Exceptions.
(d) Each
outstanding Loan of the Company and its Subsidiaries (including Loans held for resale to investors) was solicited and originated,
and is and has been administered and, where applicable, serviced, and the relevant Loan files are being maintained, in all material
respects in accordance with the relevant notes or other credit or security documents, the written underwriting standards of the
Company and its Subsidiaries (and, in the case of Loans held for resale to investors, the underwriting standards, if any, of the
applicable investors) and with all applicable federal, state and local laws, regulations and rules.
(e) Except
as set forth in Section 3.25(e) of the Company Disclosure Schedule, none of the agreements pursuant to which the Company
or any of its Subsidiaries has sold Loans or pools of Loans or participations in Loans or pools of Loans contains any obligation
to repurchase such Loans or interests therein solely on account of a payment default by the obligor on any such Loan.
(f) There
are no outstanding Loans made by the Company or any of its Subsidiaries to any “executive officer” or other “insider”
(as each such term is defined in Regulation O promulgated by the Federal Reserve Board) of the Company or its Subsidiaries, other
than Loans that are subject to and that were made and continue to be in compliance with Regulation O or that are exempt therefrom.
(g) Neither
the Company nor any of its Subsidiaries is now nor has it ever been since December 31, 2013, subject to any fine, suspension, settlement
or other contract or other administrative agreement or sanction by, or any reduction in any loan purchase commitment from, any
Governmental Entity or Regulatory Agency relating to the origination, sale or servicing of mortgage or consumer Loans.
3.26 Insurance. The
Company and its Subsidiaries are insured with reputable insurers against such risks and in such amounts as the management of the
Company reasonably has determined to be prudent and consistent with industry practice, and the Company and its Subsidiaries are
in compliance in all material respects with their insurance policies, each of which is listed in Section 3.26 of the Company
Disclosure Schedule and are not in default under any of the terms thereof, each such policy is outstanding and in full force and
effect and, except for policies insuring against potential liabilities of officers, directors and employees of the Company and
its Subsidiaries, the Company or the relevant Subsidiary thereof is the sole beneficiary of such policies, and all premiums and
other payments due under any such policy have been paid, and all claims thereunder have been filed in due and timely fashion.
3.27 No
Dissenter’s or Appraisal Rights. With respect to the transactions contemplated hereby, no holder of the capital
stock of the Company is entitled to exercise any appraisal rights under the MGCL or any successor statute, or any similar dissenter’s
or appraisal rights, and the Board of Directors of the Company has not adopted any resolutions granting or conferring appraisal
rights upon any shareholder of the Company.
3.28 No
Other Representations or Warranties.
(a) Except
for the representations and warranties made by the Company in this Article III, neither the Company nor any other person
makes any express or implied representation or warranty with respect to the Company, its Subsidiaries, or their respective businesses,
operations, assets, liabilities, conditions (financial or otherwise) or prospects, and the Company hereby disclaims any such other
representations or warranties. In particular, without limiting the foregoing disclaimer, neither the Company nor any
other person makes or has made any representation or warranty to Parent or any of its affiliates or representatives with respect
to (i) any financial projection, forecast, estimate, budget or prospective information relating to the Company, any of its Subsidiaries
or their respective businesses, or (ii) except for the representations and warranties made by the Company in this Article III,
any oral or written
information presented to Parent or any
of its affiliates or representatives in the course of their due diligence investigation of the Company, the negotiation of this
Agreement or in the course of the transactions contemplated hereby.
(b) The
Company acknowledges and agrees that neither Parent nor any other person has made or is making any express or implied representation
or warranty other than those contained in Article IV.
Article
IV
REPRESENTATIONS
AND WARRANTIES OF PARENT
Except (i) as disclosed in the disclosure
schedule delivered by Parent to the Company concurrently herewith (the “Parent Disclosure Schedule”); provided,
that (a) no such item is required to be set forth as an exception to a representation or warranty if its absence would not result
in the related representation or warranty being deemed untrue or incorrect, (b) the mere inclusion of an item in the Parent Disclosure
Schedule as an exception to a representation or warranty shall not be deemed an admission by Parent that such item represents a
material exception or fact, event or circumstance or that such item is reasonably likely to result in a Material Adverse Effect,
and (c) any disclosures made with respect to a section of Article IV shall be deemed to qualify (1) any other section of
Article IV specifically referenced or cross-referenced and (2) other sections of Article IV to the extent it is reasonably
apparent on its face (notwithstanding the absence of a specific cross-reference) from a reading of the disclosure that such disclosure
applies to such other sections or (ii) as disclosed in any Parent Reports filed by Parent since December 31, 2014 and prior to
the date hereof (but disregarding risk factor disclosures contained under the heading “Risk Factors,” or disclosures
of risks set forth in any “forward-looking statements” disclaimer or any other statements that are similarly non-specific
or cautionary, predictive or forward-looking in nature), Parent hereby represents and warrants to the Company as follows:
4.1 Corporate
Organization.
(a) Parent
is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware and is a savings
and loan holding company duly registered with the Federal Reserve Board under the Home Owners’ Loan Act of 1933, as amended
(“HOLA”). Parent has the corporate power and authority to own or lease all of its properties and
assets and to carry on its business as it is now being conducted, and is duly licensed or qualified to do business in each jurisdiction
in which the nature of the business conducted by it or the character or location of the properties and assets owned or leased by
it makes such licensing or qualification necessary, except where the failure to be so licensed or qualified would not, either individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect on Parent. True and complete copies of
the Parent Certificate and the Parent Bylaws, as in effect as of the date of this Agreement, have previously been made available
by Parent to the Company.
(b) Parent
Bank is a federally chartered savings association duly organized, validly existing and in good standing under the laws of the United
States. The
deposits of Parent Bank are insured by
the FDIC through the Deposit Insurance Fund to the fullest extent permitted by law, all premiums and assessments required to be
paid in connection therewith have been paid when due, and no proceedings for the termination of such insurance are pending or threatened.
Without duplication of the representations made by Parent in each of the foregoing sentences of this Section 4.1(b) and
those made by Parent in Section 4.1(c), each Subsidiary of Parent (a “Parent Subsidiary”) is duly organized
and validly existing under the laws of its jurisdiction of organization, is duly qualified to do business and, where such concept
is recognized under applicable law, in good standing in all jurisdictions (whether federal, state, local or foreign) where its
ownership or leasing of property or the conduct of its business requires it to be so qualified and in which the failure to be so
qualified would reasonably be expected to have a Material Adverse Effect on Parent, and has all requisite corporate power and authority
to own or lease its properties and assets and to carry on its business as now conducted. There are no restrictions on
the ability of any Subsidiary of Parent to pay dividends or distributions except, in the case of a Subsidiary that is a regulated
entity, for restrictions on dividends or distributions generally applicable to all such regulated entities. The deposit
accounts of each Subsidiary of Parent that is an insured depository institution are insured by the FDIC through the Deposit Insurance
Fund to the fullest extent permitted by law, all premiums and assessments required to be paid in connection therewith have been
paid in full when due, and no proceedings for the termination of such insurance are pending or threatened. Parent Bank is a member
in good standing of the FHLB and owns the requisite amount of stock therein. Section 4.1(b) of the Parent Disclosure Schedule
sets forth a true and complete list of all Subsidiaries of Parent as of the date hereof.
(c) Merger
Sub is a corporation duly organized, validly existing and in good standing under the laws of the State of Maryland and is wholly
owned by Parent. Merger Sub has the corporate power and authority to own or lease all of its properties and assets and
to carry on its business as it is now being conducted, and is duly licensed or qualified to do business in each jurisdiction in
which the nature of the business conducted by it or the character or location of the properties and assets owned or leased by it
makes such licensing or qualification necessary, except where the failure to be so licensed or qualified would not, either individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect on Parent. True and complete copies of
the Merger Sub Articles and Merger Sub Bylaws, as in effect as of the date of this Agreement, have previously been made available
by Parent to the Company.
4.2 Capitalization.
(a) The
authorized capital stock of Parent consists of 55,000,000 shares of Parent Common Stock and 5,000,000 shares of preferred stock,
$0.01 par value, of which no shares of preferred stock are issued or outstanding. As of the date of this Agreement,
there are (i) 17,286,557 shares of Parent Common Stock issued and outstanding, (ii) 16,280,215 shares of Parent Common Stock held
in treasury, of which 127,107 shares are allocable to awards of restricted Parent Common Stock (“Parent Restricted Stock
Awards”) granted under the OceanFirst Financial Corp. 2006 Stock Incentive Plan or the OceanFirst Financial Corp. 2011
Stock Incentive Plan (as amended), as applicable, and 2,288,181 shares have been issued to satisfy stock options granted under
the OceanFirst Financial Corp. 2000 Stock Incentive Plan, the OceanFirst Financial Corp. 2006 Stock Incentive Plan or
the OceanFirst Financial Corp. 2011 Stock Incentive Plan, as applicable (the “Parent Stock Options”, and together
with the
Parent Restricted Stock Awards, the “Parent
Equity Awards”), and (iii) no other shares of capital stock or other voting securities of Parent issued, reserved for
issuance or outstanding. All of the issued and outstanding shares of Parent Common Stock have been duly authorized and
validly issued and are fully paid, nonassessable and free of preemptive rights, with no personal liability attaching to the ownership
thereof. There are no bonds, debentures, notes or other indebtedness that have the right to vote on any matters on which
shareholders of Parent may vote. Except as set forth in Section 4.2(a) of the Parent Disclosure Schedule, there are
no trust preferred or subordinated debt securities of Parent or any of its Subsidiaries are issued or outstanding. Other
than the Parent Equity Awards issued prior to the date of this Agreement, as of the date of this Agreement there are no outstanding
subscriptions, options, warrants, puts, calls, rights, exchangeable or convertible securities or other commitments or agreements
obligating Parent to issue, transfer, sell, purchase, redeem or otherwise acquire, any such securities. There are no
voting trusts, shareholder agreements, proxies or other agreements in effect with respect to the voting or transfer of the Parent
Common Stock or other equity interests of Parent, other than any Parent Voting Agreement entered into in accordance with Section
6.20 of this Agreement.
(b) Parent
owns, directly or indirectly, all of the issued and outstanding shares of capital stock or other equity ownership interests of
each of the Parent Subsidiaries, free and clear of any Liens, and all of such shares or equity ownership interests are duly authorized
and validly issued and are fully paid, nonassessable (except, with respect to bank Subsidiaries, as provided under 12 U.S.C. §
55 or any comparable provision of applicable state law) and free of preemptive rights, with no personal liability attaching to
the ownership thereof. No Parent Subsidiary has or is bound by any outstanding subscriptions, options, warrants, calls,
rights, commitments or agreements of any character calling for the purchase or issuance of any shares of capital stock or any other
equity security of such Subsidiary or any securities representing the right to purchase or otherwise receive any shares of capital
stock or any other equity security of such Subsidiary.
4.3 Authority;
No Violation.
(a) Parent
has full corporate power and authority to execute and deliver this Agreement and to consummate the transactions contemplated hereby. The
execution and delivery of this Agreement and the consummation of the Integrated Mergers have been duly and validly approved by
the Board of Directors of Parent. The Board of Directors of Parent has determined that the Integrated Mergers, on the terms and
conditions set forth in this Agreement, are advisable and in the best interests of Parent and its shareholders, has adopted this
Agreement and has directed that the issuance of shares of Parent Common Stock in connection with the First-Step Merger be submitted
to Parent’s shareholders for approval at a meeting of such shareholders and has adopted a resolution to the foregoing effect.
Except for the affirmative vote of a majority of the total votes cast on the proposal to issue shares of Parent Common Stock in
connection with the First-Step Merger (the “Requisite Parent Vote”), no other corporate proceedings or approvals
on the part of Parent are necessary to approve this Agreement or to consummate the transactions contemplated hereby. This
Agreement has been duly and validly executed and delivered by Parent and (assuming due authorization, execution and delivery by
the Company) constitutes a valid and binding obligation of Parent, enforceable against Parent in accordance with its terms (except
in all cases as such enforceability may be limited by the Enforceability Exceptions). The shares of Parent Common Stock
to be issued in the First-Step
Merger have been validly authorized (subject
to the attainment of the Requisite Parent Vote) and, when issued, will be validly issued, fully paid and nonassessable, and no
current or past shareholder of Parent will have any preemptive right or similar rights in respect thereof.
(b) Neither
the execution and delivery of this Agreement by Parent, nor the consummation by Parent of the transactions contemplated hereby,
nor compliance by Parent with any of the terms or provisions hereof, will (i) violate any provision of the Parent Certificate or
the Parent Bylaws, or (ii) assuming that the consents and approvals referred to in Section 4.4 are duly obtained, (x) violate
any statute, code, ordinance, rule, regulation, judgment, order, writ, decree or injunction applicable to Parent, any of its Subsidiaries
or any of their respective properties or assets or (y) violate, conflict with, result in a breach of any provision of or the loss
of any benefit under, constitute a default (or an event which, with notice or lapse of time, or both, would constitute a default)
under, result in the termination of or a right of termination or cancellation under, accelerate the performance required by, or
result in the creation of any Lien upon any of the respective properties or assets of Parent or any of its Subsidiaries under,
any of the terms, conditions or provisions of any note, bond, mortgage, indenture, deed of trust, license, lease, agreement or
other instrument or obligation to which Parent or any of its Subsidiaries is a party, or by which they or any of their respective
properties or assets may be bound, except (in the case of clause (y) above) for such violations, conflicts, breaches or
defaults which either individually or in the aggregate would not reasonably be expected to have a Material Adverse Effect on Parent.
(c) The
Board of Directors of Parent Bank has adopted the Bank Merger Agreement. Parent, as the sole shareholder of Parent Bank, has approved
the Bank Merger Agreement, and the Bank Merger Agreement has been duly executed by Parent Bank.
4.4 Consents
and Approvals. Except for (a) the filing of applications, filings and notices, as applicable, with the NASDAQ, (b)
the filing of applications, filings and notices, as applicable, with the Federal Reserve Board under the HOLA and approval of such
applications, filings and notices, (c) the filings of applications, filings and notices, as applicable, with the OCC, and approval
of such applications, filings and notices, (d) the filing of applications, filings and notices, as applicable, with the NJ Department
in connection with the Bank Merger, and approval of such applications, filings and notices, (e) the filing with the SEC of (i)
any filings under applicable requirements of the Exchange Act, including the filing of the Joint Proxy Statement and (ii) the S-4
and declaration of effectiveness of the S-4, (f) the filing of the Articles of Merger with the SDAT pursuant to the MGCL, (g) the
filing of the Second-Step Merger Certificates with the Delaware Secretary and the SDAT in accordance with the DGCL and the MGCL,
respectively, (i) the filing of the Bank Merger Certificate, and (h) such filings and approvals as are required to be made or obtained
under the securities or “Blue Sky” laws of various states in connection with the issuance of shares of Parent Common
Stock pursuant to this Agreement and the approval of the listing of such Parent Common Stock on the NASDAQ, no consents or approvals
of or filings or registrations with any Governmental Entity are necessary in connection with (A) the execution and delivery by
Parent of this Agreement or (B) the consummation by Parent of the Integrated Mergers and the other transactions contemplated hereby
(including the Bank Merger).
4.5 Reports. Parent
and each of its Subsidiaries have timely filed all reports, registrations and statements, together with any amendments required
to be made with respect thereto, that they were required to file since January 1, 2013 with any Regulatory Agencies, including,
without limitation, any report, registration or statement required to be filed pursuant to the laws, rules or regulations of the
United States, any state, or any Regulatory Agency, and have paid in full all fees and assessments due and payable in connection
therewith, except where the failure to file such report, registration or statement or to pay such fees and assessments, either
individually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect on Parent. Except
for normal examinations conducted by a Regulatory Agency in the ordinary course of business of Parent and its Subsidiaries, (i)
no Regulatory Agency has initiated or has pending any proceeding or, to the knowledge of Parent, investigation into the business
or operations of Parent or any of its Subsidiaries since January 1, 2013, except where such proceedings or investigation would
not reasonably be expected to be, either individually or in the aggregate, material to Parent and its Subsidiaries, taken as a
whole, (ii) there is no unresolved violation, criticism, or exception by any Regulatory Agency with respect to any report or statement
relating to any examinations or inspections of Parent or any of its Subsidiaries, and (iii) there has been no formal or informal
inquiries by, or disagreements or disputes with, any Regulatory Agency with respect to the business, operations, policies or procedures
of Parent or any of its Subsidiaries since January 1, 2013, in each case, which would reasonably be expected to have, either individually
or in the aggregate, a Material Adverse Effect on Parent.
4.6 Financial
Statements.
(a) The
financial statements of Parent and its Subsidiaries included (or incorporated by reference) in the Parent Reports (including the
related notes, where applicable) (i) have been prepared from, and are in accordance with, the books and records of Parent and its
Subsidiaries, (ii) fairly present in all material respects the consolidated results of operations, cash flows, changes in shareholders’
equity and consolidated financial position of Parent and its Subsidiaries for the respective fiscal periods or as of the respective
dates therein set forth (subject in the case of unaudited statements to year-end audit adjustments normal in nature and amount),
(iii) complied, as of their respective dates of filing with the SEC, in all material respects with applicable accounting requirements
and with the published rules and regulations of the SEC with respect thereto, and (iv) have been prepared in accordance with GAAP
consistently applied during the periods involved, except, in each case, as indicated in such statements or in the notes thereto. The
books and records of Parent and its Subsidiaries have been, and are being, maintained in all material respects in accordance with
GAAP and any other applicable legal and accounting requirements and reflect only actual transactions. KPMG LLP has not resigned
(or informed Parent that it intends to resign) or been dismissed as independent public accountants of Parent as a result of or
in connection with any disagreements with Parent on a matter of accounting principles or practices, financial statement disclosure
or auditing scope or procedure.
(b) Except
as would not reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect on Parent, neither
Parent nor any of its Subsidiaries has any liability of any nature whatsoever (whether absolute, accrued, contingent or otherwise
and whether due or to become due), except for those liabilities that are reflected or reserved against on the consolidated balance
sheet of Parent included in its Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2015 (including any notes
thereto) and for
liabilities incurred in the ordinary
course of business consistent with past practice since September 30, 2015, or in connection with this Agreement and the transactions
contemplated hereby.
(c) The
records, systems, controls, data and information of Parent and its Subsidiaries are recorded, stored, maintained and operated under
means (including any electronic, mechanical or photographic process, whether computerized or not) that are under the exclusive
ownership and direct control of Parent or its Subsidiaries or accountants (including all means of access thereto and therefrom),
except for any non-exclusive ownership and non-direct control that would not reasonably be expected to have a Material Adverse
Effect on Parent. Parent (x) has implemented and maintains disclosure controls and procedures (as defined in Rule 13a-15(e) of
the Exchange Act) to ensure that material information relating to Parent, including its Subsidiaries, is made known to the chief
executive officer and the chief financial officer of Parent by others within those entities as appropriate to allow timely decisions
regarding required disclosures and to make the certifications required by the Exchange Act and Sections 302 and 906 of the Sarbanes-Oxley
Act, and (y) has disclosed, based on its most recent evaluation prior to the date hereof, to Parent’s outside auditors and
the audit committee of Parent’s Board of Directors (i) any significant deficiencies and material weaknesses in the design
or operation of internal control over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) which are reasonably
likely to adversely affect Parent’s ability to record, process, summarize and report financial information, and (ii) any
fraud, whether or not material, that involves management or other employees who have a significant role in Parent’s internal
controls over financial reporting. These disclosures were made in writing by management to Parent’s auditors and
audit committee and a copy has previously been made available to the Company. There is no reason to believe that Parent’s
outside auditors and its chief executive officer and chief financial officer will not be able to give the certifications and attestations
required pursuant to the rules and regulations adopted pursuant to Section 404 of the Sarbanes-Oxley Act, without qualification,
when next due.
(d) Since
January 1, 2013, (i) neither Parent nor any of its Subsidiaries, nor, to the knowledge of Parent, any director, officer, auditor,
accountant or representative of Parent or any of its Subsidiaries, has received or otherwise had or obtained knowledge of any material
complaint, allegation, assertion or claim, whether written or oral, regarding the accounting or auditing practices, procedures,
methodologies or methods (including with respect to loan loss reserves, write-downs, charge-offs and accruals) of Parent or any
of its Subsidiaries or their respective internal accounting controls, including any material complaint, allegation, assertion or
claim that Parent or any of its Subsidiaries has engaged in questionable accounting or auditing practices, and (ii) no attorney
representing Parent or any of its Subsidiaries, whether or not employed by Parent or any of its Subsidiaries, has reported evidence
of a material violation of securities laws, breach of fiduciary duty or similar violation by Parent or any of its officers, directors,
employees or agents to the Board of Directors of Parent or any committee thereof or to the knowledge of Parent, to any director
or officer of Parent.
4.7 Broker’s
Fees. With the exception of the engagement of Sandler O’Neill + Partners, L.P., neither Parent nor any Parent
Subsidiary nor any of their respective officers or directors has employed any broker, finder or financial advisor or incurred any
liability for any broker’s fees, commissions or finder’s fees in connection with the Integrated Mergers or related
transactions contemplated by this Agreement. Parent
has disclosed to the Company as of the date hereof the aggregate fees provided for in connection with the engagement by Parent
of Sandler O’Neill + Partners, L.P. related to the Integrated Mergers and the other transactions contemplated hereby.
4.8 Absence
of Certain Changes or Events. Since December 31, 2014, no event or events have occurred that have had or would reasonably
be expected to have, either individually or in the aggregate, a Material Adverse Effect on Parent.
4.9 Legal
Proceedings.
(a) Neither
Parent nor any of its Subsidiaries is a party to any, and there are no pending or, to Parent’s knowledge, threatened, legal,
administrative, arbitral or other proceedings, claims, actions or governmental or regulatory investigations (i) of any material
nature against Parent or its Subsidiaries or any of their current or former directors or executive officers, other than those set
forth on Section 4.9(a)(i) of the Parent Disclosure Schedule or (ii) challenging the validity or propriety of the transactions
contemplated by this Agreement.
(b) There
is no injunction, order, judgment, decree, or regulatory restriction imposed upon Parent, any of its Subsidiaries or the assets
of Parent or any of its Subsidiaries (or that, upon consummation of the Integrated Mergers, would apply to Parent or any of its
affiliates) that would reasonably be expected to be material to Parent and its Subsidiaries, taken as a whole.
4.10 Taxes
and Tax Returns.
(a) Each
of Parent and its Subsidiaries has duly and timely filed or caused to be filed (giving effect to all applicable extensions) all
material Tax Returns required to be filed by any of them, and all such Tax Returns are true, correct, and complete in all material
respects.
(b) All
material Taxes of Parent and its Subsidiaries that are due have been fully and timely paid or adequate reserves therefor have been
made on the financial statements of Parent and its Subsidiaries included (or incorporated by reference) in the Parent Reports (including
the related notes, where applicable). Each of Parent and its Subsidiaries has withheld and paid to the relevant Governmental
Entity on a timely basis all material Taxes required to have been withheld and paid in connection with amounts paid or owing to
any person.
(c) No
claim has been made in writing by any Governmental Entity in a jurisdiction where Parent or any of its Subsidiaries does not file
Tax Returns that Parent or such subsidiary is or may be subject to taxation by that jurisdiction.
(d) There
are no material Liens for Taxes on any of the assets of Parent or any of its Subsidiaries.
(e) Neither
Parent nor any of its Subsidiaries has received written notice of assessment or proposed assessment in connection with any material
amount of Taxes, and
there are no threatened in writing or
pending disputes, claims, audits, examinations, investigations, or other proceedings regarding any material Tax of Parent and its
Subsidiaries or the assets of Parent and its Subsidiaries which have not been paid, settled or withdrawn or for which adequate
reserves have not been established.
(f) Neither
Parent nor any of its Subsidiaries has taken any action, or knows of any fact or circumstance, that could reasonably be expected
to prevent the Integrated Mergers, taken together, from being treated as an integrated transaction that qualifies as a “reorganization”
within the meaning of Section 368(a) of the Code.
4.11 Employees.
(a) Section
4.11(a) of the Parent Disclosure Schedule lists all Parent Benefit Plans. Each Parent Benefit Plan has been established,
operated and administered in all material respects in accordance with its terms and the requirements of all applicable laws, including
ERISA and the Code. For purposes of this Agreement, “Parent Benefit Plans” mean all employee benefit
plans (as defined in Section 3(3) of ERISA, whether or not subject to ERISA, whether funded or unfunded, and all pension, benefit,
retirement, bonus, stock option, stock purchase, restricted stock, stock-based, performance award, phantom equity, incentive, deferred
compensation, retiree medical or life insurance, supplemental retirement, severance, retention, employment, consulting, termination,
change in control, salary continuation, accrued leave, sick leave, vacation, paid time off, health, medical, disability, life,
accidental death and dismemberment, insurance, welfare, fringe benefit and other similar plans, programs, policies, practices or
arrangements or other contracts or agreements (and any amendments thereto) to or with respect to which Parent or any Subsidiary
or any trade or business of Parent or any of its Subsidiaries, whether or not incorporated, all of which together with Parent would
be deemed a “single employer” within the meaning of Section 4001 of ERISA (a “Parent ERISA Affiliate”),
is a party or has any current or future obligation or that are sponsored, maintained, contributed to or required to be contributed
to by Parent or any of its Subsidiaries or any Parent ERISA Affiliate for the benefit of any current or former employee, officer,
director, consultant or independent contractor (or any spouse or dependent of such individual) of Parent or any of its Subsidiaries
or any Parent ERISA Affiliate.
(b) With
respect to each Parent Benefit Plan that is subject to Title IV or Section 302 of ERISA or Sections 412, 430 or 4971 of the Code:
(i) no such plan is in “at-risk” status for purposes of Section 430 of the Code, (ii) the present value of accrued
benefits under such Parent Benefit Plan, based upon the actuarial assumptions used for funding purposes in the most recent actuarial
report prepared by such Parent Benefit Plan’s actuary with respect to such Parent Benefit Plan, did not, as of its latest
valuation date, exceed the then current fair market value of the assets of such Parent Benefit Plan allocable to such accrued benefits,
(iii) no reportable event within the meaning of Section 4043(c) of ERISA for which the 30-day notice requirement has not been waived
has occurred, (iv) all premiums to the PBGC have been timely paid in full, (v) no liability (other than for premiums to the PBGC)
under Title IV of ERISA has been or is expected to be incurred by Parent or any of its Subsidiaries, and (vi) the PBGC has not
instituted proceedings to terminate any such Parent Benefit Plan.
(c) There
are no pending or threatened claims (other than claims for benefits in the ordinary course), lawsuits or arbitrations that have
been asserted or instituted, and, to Parent’s knowledge, no set of circumstances exists that may reasonably be expected to
give rise to a claim or lawsuit, against the Parent Benefit Plans, any fiduciaries thereof with respect to their duties to the
Parent Benefit Plans or the assets of any of the trusts under any of the Parent Benefit Plans that could reasonably be expected
to result in any material liability of Parent or any of its Subsidiaries to the PBGC, the IRS, the DOL, any Multiemployer Plan,
a Multiple Employer Plan, any participant in any Parent Benefit Plan, or any other party.
(d) There
are no pending or, to Parent’s knowledge, threatened material labor grievances or material unfair labor practice claims or
charges against Parent or any of its Subsidiaries, or any strikes or other material labor disputes against Parent or any of its
Subsidiaries. Neither Parent nor any of its Subsidiaries are party to or bound by any collective bargaining or similar
agreement with any labor organization, or work rules or practices agreed to with any labor organization or employee association
applicable to employees of Parent or any of its Subsidiaries and, to the knowledge of Parent, there are no organizing efforts by
any union or other group seeking to represent any employees of Parent or any of its Subsidiaries and no employees of Parent or
any of its Subsidiaries are represented by any labor organization.
4.12 SEC
Reports. Parent has previously made available to the Company an accurate and complete copy of each communication
mailed by Parent to its shareholders since December 31, 2013. No such communication or any final registration statement,
prospectus, report, schedule and definitive proxy statement filed with or furnished to the SEC since December 31, 2013 by Parent
pursuant to the Securities Act or the Exchange Act (the “Parent Reports”) as of the date thereof (and, in the
case of registration statements and proxy statements, on the dates of effectiveness and the dates of the relevant meetings, respectively),
contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein or necessary
in order to make the statements therein, in light of the circumstances in which they were made, not misleading, except that information
filed or furnished as of a later date (but before the date of this Agreement) shall be deemed to modify information as of an earlier
date. Since December 31, 2013, as of their respective dates, all Parent Reports filed under the Securities Act and the
Exchange Act complied in all material respects with the published rules and regulations of the SEC with respect thereto. None
of the Parent Subsidiaries is required to file periodic reports with the SEC pursuant to Section 13 or 15(d) of the Exchange Act.
As of the date of this Agreement, no executive officer of Parent has failed in any respect to make the certifications required
of him or her under Section 302 or 906 of the Sarbanes-Oxley Act. As of the date of this Agreement, there are no outstanding
comments from or unresolved issues raised by the SEC with respect to any of the Parent Reports.
4.13 Compliance
with Applicable Law. Parent and each of its Subsidiaries hold, and have at all times since December 31, 2013, held,
all licenses, franchises, permits and authorizations necessary for the lawful conduct of their respective businesses and ownership
of their respective properties, rights and assets under and pursuant to each (and have paid in full all fees and assessments due
and payable in connection therewith), except where neither the cost of failure to hold nor the cost of obtaining and holding such
license, franchise, permit or authorization (nor the failure to pay any fees or assessments) would, either individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect on Parent, and to the
knowledge of Parent no suspension or cancellation
of any such necessary license, franchise, permit or authorization is threatened. Parent and each of its Subsidiaries
have complied in all material respects with and are not in material default or violation under any, applicable law, statute, order,
rule, regulation, policy and/or guideline of any Governmental Entity relating to Parent or any of its Subsidiaries, including without
limitation all laws related to data protection or privacy, the USA PATRIOT Act, the Bank Secrecy Act, the Equal Credit Opportunity
Act and Regulation B, the Fair Housing Act, the Community Reinvestment Act, the Fair Credit Reporting Act, the Truth in Lending
Act and Regulation Z, the Home Mortgage Disclosure Act, the Fair Debt Collection Practices Act, the Electronic Fund Transfer Act,
the Dodd-Frank Wall Street Reform and Consumer Protection Act, any regulations promulgated by the Consumer Financial Protection
Bureau, the Interagency Policy Statement on Retail Sales of Nondeposit Investment Products, the SAFE Mortgage Licensing Act of
2008, the Real Estate Settlement Procedures Act and Regulation X, and any other law relating to bank secrecy, discriminatory lending,
financing or leasing practices, money laundering prevention, Sections 23A and 23B of the Federal Reserve Act, the Sarbanes-Oxley
Act, the Federal Deposit Insurance Corporation Improvement Act and all agency requirements relating to the origination, sale and
servicing of mortgage and consumer loans. Parent Bank is an insured depository institution has a Community Reinvestment
Act rating of “satisfactory” or better. Without limitation, none of Parent, or its Subsidiaries, or to the
knowledge of Parent, any director, officer, employee, agent or other person acting on behalf of Parent or any of its Subsidiaries
has, directly or indirectly, (a) used any funds of Parent or any of its Subsidiaries for unlawful contributions, unlawful gifts,
unlawful entertainment or other expenses relating to political activity, (b) made any unlawful payment to foreign domestic governmental
officials or employees or to foreign or domestic political parties or campaigns from funds of Parent or any of its Subsidiaries,
(c) violated any provision that would result in the violation of the Foreign Corrupt Practices Act of 1977, as amended, or any
similar law, (d) established or maintained any unlawful fund of monies or other assets of Parent or any of its Subsidiaries,
(e) made any fraudulent entry on the books or records of Parent or any of its Subsidiaries, or (f) made any unlawful bribe, unlawful
rebate, unlawful payoff, unlawful influence payment, unlawful kickback or other unlawful payment to any person, private or public,
regardless of form, whether in money, property or services, to obtain favorable treatment in securing business to obtain special
concessions for Parent or any of its Subsidiaries, to pay for favorable treatment for business secured or to pay for special concessions
already obtained for Parent or any of its Subsidiaries, or is currently subject to any United States sanctions administered by
the Office of Foreign Assets Control of the United States Treasury Department.
4.14 Agreements
with Regulatory Agencies. Except as set forth on Section 4.14 of the Parent Disclosure Schedule, neither
Parent nor any of its Subsidiaries is subject to any cease-and-desist or other order or enforcement action issued by, or is a party
to any written agreement, consent agreement or memorandum of understanding with, or is a party to any commitment letter or similar
undertaking to, or is subject to any order or directive by, or has been ordered to pay any civil money penalty by, or has been
since January 1, 2013, a recipient of any supervisory letter from, or since January 1, 2013, has adopted any policies, procedures
or board resolutions at the request or suggestion of any Regulatory Agency or other Governmental Entity that currently restricts
in any material respect the conduct of its business or that in any material manner relates to its capital adequacy, its ability
to pay dividends, its credit or risk management policies, its management or its business (each, whether or not set forth in the
Parent Disclosure Schedule, a “Parent Regulatory Agreement”), nor has Parent or any of its Subsidiaries
been advised since January 1, 2013, by
any Regulatory Agency or other Governmental Entity that it is considering issuing, initiating, ordering or requesting any such
Parent Regulatory Agreement. Parent and its Subsidiaries are in compliance in all material respects with each Regulatory Agreement
to which it is a party or is subject. Parent and its Subsidiaries have not received any notice from any Governmental
Entity indicating that Parent or its Subsidiaries is not in compliance in any material respect with any Regulatory Agreement.
4.15 Certain
Contracts.
(a) Each
contract, arrangement, commitment or understanding (whether written or oral) which is a “material contract” (as such
term is defined in Item 601(b)(10) of Regulation S-K of the SEC) to which Parent or any of its Subsidiaries is a party or by which
Parent or any of its Subsidiaries is bound as of the date hereof has been filed as an exhibit to the most recent Annual Report
on Form 10-K filed by Parent, or a Quarterly Report on Form 10-Q or Current Report on Form 8-K subsequent thereto (each a “Parent
Contract”) and neither Parent nor any of its Subsidiaries knows of, or has received notice of, any material violation
of the above by any of the other parties thereto.
(b) Each
Parent Contract is valid and binding on Parent or one of its Subsidiaries, as applicable, and in full force and effect, except
as, either individually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect on Parent. Parent
and each of its Subsidiaries has in all material respects performed all obligations required to be performed by it under each Parent
Contract. To Parent’s knowledge, each third-party counterparty to each Parent Contract has in all material respects
performed all obligations required to be performed by it under such Parent Contract, and no event or condition exists which constitutes
or, after notice or lapse of time or both, will constitute, a material default on the part of Parent or any of its Subsidiaries
under any such Parent Contract.
4.16 Environmental
Matters. Except as disclosed in Section 4.16 of the Parent Disclosure Schedule, and except as would not reasonably
be expected to have, individually or in the aggregate, a Material Adverse Effect on Parent, Parent and its Subsidiaries are in
compliance, and have complied, with any federal, state or local law, regulation, order, decree, permit, authorization, common law
or agency requirement relating to Environmental Laws. There are no legal, administrative, arbitral or other proceedings, claims
or actions, or to the knowledge of Parent any private environmental investigations or remediation activities or governmental investigations
of any nature seeking to impose, or that could reasonably be expected to result in the imposition, on Parent or any of its Subsidiaries
of any liability or obligation arising under any Environmental Law, pending or threatened against Parent, which liability or obligation
would reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect on Parent. To
the knowledge of Parent, there is no reasonable basis for any such proceeding, claim, action or governmental investigation that
would impose any liability or obligation that would reasonably be expected to have, either individually or in the aggregate, a
Material Adverse Effect on Parent. Parent is not subject to any agreement, order, judgment, decree, letter agreement
or memorandum of agreement by or with any court, governmental authority, regulatory agency or third party imposing any liability
or obligation with respect to the foregoing that would reasonably be expected to have, either individually or in the aggregate,
a Material Adverse Effect on Parent.
4.17 Insurance. Parent
and its Subsidiaries are insured with reputable insurers against such risks and in such amounts as the management of Parent reasonably
has determined to be prudent and consistent with industry practice, and Parent and its Subsidiaries are in compliance in all material
respects with their insurance policies, are not in default under any of the terms thereof, each such policy is outstanding and
in full force and effect and, except for policies insuring against potential liabilities of officers, directors and employees of
Parent and its Subsidiaries, Parent or the relevant Subsidiary thereof is the sole beneficiary of such policies, and all premiums
and other payments due under any such policy have been paid, and all claims thereunder have been filed in due and timely fashion.
4.18 Real
Property. Parent and each Parent Subsidiary has good and marketable title to all the real property reflected in
the latest audited balance sheet included in the Parent Reports as being owned by Parent or any such Parent Subsidiary or acquired
after the date thereof (except properties sold or otherwise disposed of since the date thereof in the ordinary course of business)
(the “Parent Owned Properties”), free and clear of all material Liens, except for Permitted Encumbrances, and
is the lessee of all leasehold estates reflected in the latest audited financial statements included in such Parent Reports or
acquired after the date thereof (except for leases that have expired by their terms since the date thereof) (the “Parent
Leased Properties” and, collectively with the Parent Owned Properties, the “Parent Real Property”),
free and clear of all Liens of any nature whatsoever, except for Permitted Encumbrances, and is in possession of the properties
purported to be leased thereunder, and each such lease is valid without default thereunder by the lessee or, to Parent’s
knowledge, the lessor. There are no pending or, to the knowledge of Parent, threatened condemnation proceedings against
Parent Real Property.
4.19 Loan
Portfolio.
(a) Except
as would not reasonably be expected to have a Material Adverse Effect on Parent, each Loan of Parent and its Subsidiaries (i) is
evidenced by notes, agreements or other evidences of indebtedness that are true, genuine and what they purport to be, (ii) to the
extent carried on the books and records of Parent and its Subsidiaries as secured Loans, has been secured by valid charges, mortgages,
pledges, security interests, restrictions, claims, liens or encumbrances, as applicable, which have been perfected and (iii) is
the legal, valid and binding obligation of the obligor named therein, enforceable in accordance with its terms, subject to the
Enforceability Exceptions.
(b) Each
outstanding Loan of Parent and its Subsidiaries (including Loans held for resale to investors) was solicited and originated, and
is and has been administered and, where applicable, serviced, and the relevant Loan files are being maintained, in all material
respects in accordance with the relevant notes or other credit or security documents, the written underwriting standards of Parent
and its Subsidiaries (and, in the case of Loans held for resale to investors, the underwriting standards, if any, of the applicable
investors) and with all applicable federal, state and local laws, regulations and rules.
(c) There
are no outstanding Loans made by Parent or any of its Subsidiaries to any “executive officer” or other “insider”
(as each such term is defined in Regulation O promulgated by the Federal Reserve Board) of Parent or its Subsidiaries, other than
Loans that are subject to and that were
made and continue to be in compliance with Regulation O or that are exempt therefrom.
(d) Neither
Parent nor any of its Subsidiaries is now nor has it ever been since December 31, 2013, subject to any fine, suspension, settlement
or other contract or other administrative agreement or sanction by, or any reduction in any loan purchase commitment from, any
Governmental Entity or Regulatory Agency relating to the origination, sale or servicing of mortgage or consumer Loans.
4.20 Takeover
Statutes. No Takeover Statute is applicable to this Agreement, the Integrated Mergers or any of the other transactions
contemplated by this Agreement under the DGCL or federal law.
4.21 Opinion. Prior
to the execution of this Agreement, the Board of Directors of Parent has received an opinion (which, if initially rendered verbally,
has been or will be confirmed by a written opinion, dated the same date) of Sandler O’Neill + Partners, L.P. to the effect
that, as of the date of such opinion, and based upon and subject to the factors, assumptions and limitations set forth therein,
the Merger Consideration is fair from a financial point of view to Parent. Such opinion has not been amended or rescinded
as of the date of this Agreement.
4.22 Parent
Information. The information relating to Parent and its Subsidiaries to be contained in the Joint Proxy Statement
and the S-4, and the information relating to Parent and its Subsidiaries that is provided by Parent or its representatives for
inclusion in any other document filed with any other Regulatory Agency in connection herewith, will not contain any untrue statement
of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances in
which they are made, not misleading. The Joint Proxy Statement (except for such portions thereof that relate only to
the Company or any of its Subsidiaries) will comply in all material respects with the provisions of the Exchange Act and the rules
and regulations thereunder. The S-4 (except for such portions thereof that relate only to the Company or any of its
Subsidiaries) will comply in all material respects with the provisions of the Securities Act and the rules and regulations thereunder.
4.23 No
Other Representations or Warranties.
(a) Except
for the representations and warranties made by Parent in this Article IV, neither Parent nor any other person makes any
express or implied representation or warranty with respect to Parent, its Subsidiaries, or their respective businesses, operations,
assets, liabilities, conditions (financial or otherwise) or prospects, and Parent hereby disclaims any such other representations
or warranties. In particular, without limiting the foregoing disclaimer, neither Parent nor any other person makes or
has made any representation or warranty to the Company or any of its affiliates or representatives with respect to (i) any financial
projection, forecast, estimate, budget or prospective information relating to Parent, any of its Subsidiaries or their respective
businesses, or (ii) except for the representations and warranties made by Parent in this Article IV, any oral or written
information presented to the Company or any of its affiliates or representatives in the course of their due diligence investigation
of Parent, the negotiation of this Agreement or in the course of the transactions contemplated hereby.
(b) Parent
acknowledges and agrees that neither the Company nor any other person has made or is making any express or implied representation
or warranty other than those contained in Article III.
Article
V
COVENANTS
RELATING TO CONDUCT OF BUSINESS
5.1 Conduct
of Business of the Company Prior to the Effective Time. During the period from the date of this Agreement to the
Effective Time or the earlier termination of this Agreement, except as expressly contemplated or permitted by this Agreement (including
as set forth in the Company Disclosure Schedule), required by law or as consented to in writing by Parent, the Company shall, and
shall cause each of its Subsidiaries to, conduct its business in the ordinary course in all material respects, use reasonable best
efforts to maintain and preserve intact its business organization, employees, independent contractors and advantageous business
relationships, and take no action that would reasonably be expected to adversely affect or delay the ability to obtain any necessary
approvals of any Regulatory Agency or other Governmental Entity required for the transactions contemplated hereby or to perform
the Company’s covenants and agreements under this Agreement or to consummate the transactions contemplated hereby on a timely
basis.
5.2 Company
Forbearances. During the period from the date of this Agreement to the Effective Time or the earlier termination
of this Agreement, except as set forth in the Company Disclosure Schedule, as expressly contemplated or permitted by this Agreement
or as required by law, the Company shall not, and shall not permit any of its Subsidiaries to, without the prior written consent
of Parent (such consent not to be unreasonably withheld):
(a) other
than in the ordinary course of business, incur any indebtedness for borrowed money (other than indebtedness of the Company or any
of its wholly-owned Subsidiaries to the Company or any of its other Subsidiaries), assume, guarantee, endorse or otherwise as an
accommodation become responsible for the obligations of any other individual, corporation or other entity;
(b)
(i) adjust,
split, combine or reclassify any capital stock;
(ii) make,
declare or pay any dividend, or make any other distribution on, or directly or indirectly redeem, purchase or otherwise acquire,
any shares of its capital stock or any securities or obligations convertible (whether currently convertible or convertible only
after the passage of time or the occurrence of certain events) into or exchangeable for any shares of its capital stock (except
(A) regular quarterly cash dividends by the Company at a rate not in excess of $0.10 per share of Company Common Stock, (B) dividends
paid by any of the Subsidiaries of the Company to the Company or any of its wholly-owned Subsidiaries, or (C) the acceptance of
shares of Company Common Stock as
payment for the exercise price
of the Company Stock Options or for withholding taxes incurred in connection with the exercise of the Company Stock Options or
the vesting or settlement of the Company Equity Awards, in each case, in accordance with past practice and the terms of the applicable
award agreements);
(iii) grant
any stock options, stock appreciation rights, performance shares, restricted stock units, restricted shares or other equity or
equity-based awards or interests, or grant any individual, corporation or other entity any right to acquire any shares of its capital
stock; or
(iv) issue,
sell or otherwise permit to become outstanding (including by issuing any shares of Company Common Stock that are held as “treasury
shares” as of the date of this Agreement) any additional shares of capital stock or securities convertible or exchangeable
into, or exercisable for, any shares of its capital stock or any options, warrants, or other rights of any kind to acquire any
shares of capital stock, except pursuant to the exercise of stock options or the settlement of equity compensation awards outstanding
as of the date hereof in accordance with their terms;
(c) sell,
transfer, mortgage, encumber or otherwise dispose of any of its material properties or assets or any business to any individual,
corporation or other entity other than a wholly-owned Subsidiary of the Company, or cancel, release or assign any indebtedness
to any such person or any claims held by any such person, in each case, other than in the ordinary course of business or pursuant
to contracts or agreements in force at the date of this Agreement and set forth on Section 5.2(c) of the Company Disclosure
Schedule;
(d) except
for transactions in the ordinary course of business, make any material investment either by purchase of stock or securities, contributions
to capital, property transfers, or purchase of any property or assets of any other individual, corporation or other entity other
than a wholly-owned Subsidiary of the Company;
(e) terminate,
materially amend, or waive any material provision of, any Company Contract, or make any change in any instrument or agreement governing
the terms of any of its securities, or material lease or contract, other than normal renewals of contracts and leases without material
adverse changes of terms with respect to the Company, or enter into any contract that would constitute a Company Contract if it
were in effect on the date of this Agreement;
(f) except
as required under applicable law or the terms of any Company Benefit Plan existing as of the date hereof, (i) enter into, adopt
or terminate any employee benefit or compensation plan, program, practice, policy, contract or arrangement for the benefit or welfare
of any current or former employee, officer, director, independent contractor or consultant (or any spouse or dependent of such
individual), (ii) amend (whether in writing or through the interpretation of) any Company Benefit Plan, (iii) increase the compensation
or benefits payable to any current or former employee, officer, director, independent contractor or consultant (or any spouse or
dependent of such individual), except for annual base salary or wage increases for employees (which includes executive officers)
in the
ordinary course of business, consistent
with past practice, that do not exceed, with respect to any individual, two and one-half percent (2.5%) of such individual’s
base salary or wage rate in effect as of the date hereof, (iv) pay or award, or commit to pay or award, any bonuses or incentive
compensation, other than annual bonuses in respect of performance in 2015 and payable in early 2016 that are determined in the
ordinary course of business, consistent with past practice and that do not exceed the amount set forth on Section 5.2(f)(iv)
of the Company Disclosure Schedule, (v) grant or accelerate the vesting of any equity or equity-based awards or other compensation,
(vi) negotiate or enter into any new, or amend any existing, employment, severance, change in control, retention, bonus guarantee,
collective bargaining agreement or similar agreement or arrangement, (vii) fund any rabbi trust or similar arrangement, (viii)
terminate the employment or services of any officer or any employee whose target total annual compensation is greater than $100,000,
other than for cause (as determined in the ordinary course of business and consistent with past practice), (ix) hire or promote
any officer, employee, independent contractor or consultant who has target total annual compensation greater than $100,000 or (x)
waive, release or limit any Restrictive Covenant obligation of any current or former employee or contractor of the Company or any
of its Subsidiaries;
(g) settle
any material claim, suit, action or proceeding, except in the ordinary course of business in an amount and for consideration not
in excess of $50,000 individually or in the aggregate and that would not impose any material restriction on the business of it
or its Subsidiaries or the Surviving Corporation;
(h) take
any action, or knowingly fail to take any action, where such action or failure to act could reasonably be expected to prevent the
Integrated Mergers, taken together, from being treated as an integrated transaction that qualifies as a “reorganization”
within the meaning of Section 368(a) of the Code;
(i) amend
the Company Articles, Company Bylaws or comparable governing document of any of its Subsidiaries;
(j) merge
or consolidate itself or any of its Subsidiaries with any other person, or restructure, reorganize or completely or partially liquidate
or dissolve it or any of its Subsidiaries;
(k) materially
restructure or materially change its investment securities or derivatives portfolio or its interest rate exposure, through purchases,
sales or otherwise, or the manner in which the portfolio is classified or reported or purchase any security rated below investment
grade;
(l) take
any action that is intended or expected to result in any of its representations and warranties set forth in this Agreement being
or becoming untrue in any material respect at any time prior to the Effective Time, or in any of the conditions to the Integrated
Mergers set forth in Article VII not being satisfied or in a violation of any provision of this Agreement, except, in every
case, as may be required by applicable law;
(m) implement
or adopt any change in its accounting principles, practices or methods, other than as may be required by GAAP;
(n) (i)
enter into any new line of business or change in any material respect its lending, investment, underwriting, risk and asset liability
management and other banking and operating, securitization and servicing policies (including any change in the maximum ratio or
similar limits as a percentage of its capital exposure applicable with respect to its loan portfolio or any segment thereof), except
as required by applicable law, regulation or policies imposed by any Governmental Entity, (ii) make any loans or extensions of
credit except in the ordinary course of business consistent with past practice, or (iii) make any individual unsecured loan or
extension of credit that is not as of the date of this Agreement approved and committed (a schedule of which approved and committed
loans has been made available to Parent) in excess of $100,000 or any individual secured loan or extension of credit either (x)
in excess of $500,000 and secured by property located, or made to a borrower that resides or is headquartered, more than seventy-five
(75) miles from the Company’s principal executive office (it being understood that the Company shall,
on a biweekly basis from the date of this Agreement until the Effective Time, deliver to Parent a schedule setting forth any secured
loan or extension of credit in excess of $500,000 made by the Company or any of its Subsidiaries) or (y) in excess of $2.0 million;
(o) make
any material changes in its policies and practices with respect to (i) underwriting, pricing, originating, acquiring, selling,
servicing, or buying or selling rights to service Loans or (ii) its hedging practices and policies, in each case except as required
by law or requested by a Regulatory Agency;
(p) make,
or commit to make, any capital expenditures in excess of $50,000 individually or $250,000 in the aggregate;
(q) make,
change or revoke any Tax election, adopt or change any Tax accounting method, file any amended Tax Return, settle or compromise
any Tax Liability, claim or assessment or agree to an extension or waiver of the limitation period to any material Tax claim or
assessment, grant any power of attorney with respect to material Taxes, surrender any right to claim a refund of material Taxes,
enter into any closing agreement with respect to any material Tax or refund or amend any material Tax Return;
(r) make
application for the opening, relocation or closing of any, or open, relocate or close any, branch office, loan production office
or other significant office or operations facility of it or its Subsidiaries;
(s) materially
reduce the amount of insurance coverage or fail to renew any material existing insurance policy, in each case, with respect to
the properties or assets of the Company or any of its Subsidiaries;
(t) with
respect to the transactions contemplated hereby, take any action to cause any holder of the capital stock of the Company to be
entitled to exercise any appraisal rights under the Company’s Bylaws or the MGCL or any successor statute, or any similar
dissenter’s or appraisal rights; or
(u) agree
to take, make any commitment to take, or adopt any resolutions of its Board of Directors or similar governing body in support of,
any of the actions prohibited by this Section 5.2.
5.3 Parent
Forbearances. During the period from the date of this Agreement to the Effective Time or the earlier termination
of this Agreement, except as set forth in the Parent Disclosure Schedule, as expressly contemplated or permitted by this Agreement
or as required by law, Parent shall not, and shall not permit any of its Subsidiaries to, without the prior written consent of
the Company (such consent not to be unreasonably withheld):
(a) amend
the Parent Certificate or Parent Bylaws in a manner that would adversely affect the economic benefits of the Integrated Mergers
to the holders of Company Common Stock;
(b) (i)
adjust, split, combine or reclassify any capital stock of Parent, or (ii) make, declare or pay any dividend, or make any other
distribution on, any shares of its capital stock or any securities or obligations convertible (whether currently convertible or
convertible only after the passage of time or the occurrence of certain events) into or exchangeable for any shares of its capital
stock (except regular quarterly cash dividends or dividends paid by any of the Subsidiaries of Parent to Parent or any of its wholly
owned Subsidiaries);
(c) acquire
or agree to acquire by merging or consolidating with, or by purchasing a substantial portion of the assets of or equity in, or
by any other manner, any Person or portion thereof, or otherwise acquire or agree to acquire any assets, if the entering into of
a definitive agreement relating to or the consummation of such acquisition, merger or consolidation would reasonably be expected
to (i) impose any material delay in the obtaining of, or significantly increase the risk of not obtaining any authorizations, consents,
orders, declarations or approvals of any Governmental Entity necessary to consummate the transactions contemplated hereby or the
expiration or termination of any applicable waiting period, (ii) significantly increase the risk of any Governmental Entity entering
an order prohibiting the consummation of the transactions contemplated hereby, or (iii) materially delay the consummation of the
transactions contemplated hereby;
(d) take
any action that is intended to result in any of its representations and warranties set forth in this Agreement being or becoming
untrue in any material respect at any time prior to the Effective Time, or in any of the conditions to the Integrated Mergers set
forth in Article VII not being satisfied or in a violation of any provision of this Agreement, except, in every case, as
may be required by applicable law;
(e) take
any action, or knowingly fail to take any action, where such action or failure to act would reasonably be expected to prevent the
Integrated Mergers, taken together, from being treated as an integrated transaction that qualifies as a “reorganization”
within the meaning of Section 368(a) of the Code; or
(f) agree
to take, make any commitment to take, or adopt any resolutions of its Board of Directors or similar governing body in support of,
any of the actions prohibited by this Section 5.3.
5.4 Tax-free
Reorganization. Officers of Parent, Merger Sub and the Company shall execute and deliver to Skadden, Arps, Slate,
Meagher & Flom LLP and to Luse Gorman, PC, respectively, certificates containing appropriate representations and covenants,
reasonably satisfactory in form and substance to such counsel, at such time or times as may be reasonably requested by such counsel,
including the effective date of the Joint Proxy Statement and the Closing Date, in connection with such counsel’s deliveries
of opinions with respect to the Tax treatment of the Integrated Mergers.
Article
VI
ADDITIONAL
AGREEMENTS
6.1 Regulatory
Matters.
(a) Parent
and the Company shall promptly prepare and file with the SEC, no later than 30 business days after of the date of this Agreement,
the Joint Proxy Statement and Parent shall promptly prepare and file with the SEC the S-4, in which the Joint Proxy Statement will
be included as a prospectus. Each of Parent and the Company shall cooperate in respect of the form and content of any
other communication with shareholders of the Company. Each of Parent and the Company shall use their reasonable best
efforts to have the S-4 declared effective under the Securities Act as promptly as practicable after such filing, and Parent and
the Company shall thereafter mail or deliver the Joint Proxy Statement to their respective shareholders. Parent shall
also use its reasonable best efforts to obtain all necessary state securities law or “Blue Sky” permits and approvals
required to carry out the transactions contemplated by this Agreement, and the Company shall furnish all information concerning
the Company and the holders of Company Common Stock as may be reasonably requested in connection with any such action.
(b) The
parties hereto shall cooperate with each other and use their respective reasonable best efforts to promptly (and in the case of
the regulatory applications to the Federal Reserve Board, the OCC and the NJ Department within 30 business days of the date of
this Agreement) prepare and file all necessary documentation, to effect all applications, notices, petitions and filings, to obtain
as promptly as practicable all permits, consents, approvals and authorizations of all third parties and Governmental Entities which
are necessary or advisable to consummate the transactions contemplated by this Agreement (including, without limitation, the Integrated
Mergers and the Bank Merger), and to comply with the terms and conditions of all such permits, consents, approvals and authorizations
of all such Governmental Entities. Parent and the Company shall have the right to review in advance, and, to the extent practicable,
each will consult with the other on, in each case subject to applicable laws relating to the exchange of information (and subject
to necessary redactions relating to confidential or sensitive information), all the information relating to the Company or Parent,
as the case may be, and any of their respective Subsidiaries, which appears in any filing made with, or written materials submitted
to, any third party or any Governmental Entity in connection with the transactions contemplated by this Agreement. In
exercising the foregoing right, each of the parties hereto shall act reasonably and as promptly as practicable. The
parties hereto agree that they will consult with each other with respect to the obtaining of all permits, consents, approvals and
authorizations of all third parties and Governmental Entities necessary or advisable to
consummate the transactions contemplated
by this Agreement and each party will keep the other apprised of the status of matters relating to completion of the transactions
contemplated herein. Each party shall consult with the other in advance of any formal meeting or conference with any
Governmental Entity in connection with the transactions contemplated by this Agreement and to the extent permitted by such Governmental
Entity, give the other party and/or its counsel the opportunity to attend and participate in such meetings and conferences. Notwithstanding
the foregoing or anything to the contrary in this Agreement, nothing contained herein shall be deemed to require Parent or the
Company to take any action, or commit to take any action, or agree to any condition or restriction, in connection with obtaining
the foregoing permits, consents, approvals and authorizations of Governmental Entities that would reasonably be expected to have
a Material Adverse Effect (measured on a scale relative to the Company) on any of Parent, the Company or the Surviving Corporation,
after giving effect to the Integrated Mergers (a “Materially Burdensome Regulatory Condition”).
(c) Parent
and the Company shall, upon request, furnish each other with all information concerning themselves, their Subsidiaries, directors,
officers and shareholders and such other matters as may be reasonably necessary or advisable in connection with the Joint Proxy
Statement, the S-4 or any other statement, filing, notice or application made by or on behalf of Parent, the Company or any of
their respective Subsidiaries to any Governmental Entity in connection with the Integrated Mergers, the Bank Merger and the other
transactions contemplated by this Agreement.
(d) Parent
and the Company shall promptly advise each other upon receiving any communication from any Governmental Entity whose consent or
approval is required for consummation of the transactions contemplated by this Agreement that causes such party to believe that
there is a reasonable likelihood that any Requisite Regulatory Approval will not be obtained or that the receipt of any such approval
will be materially delayed. As used in this Agreement, the “Requisite Regulatory Approvals” shall
mean all regulatory authorizations, consents, orders or approvals from (x) the Federal Reserve Board, the OCC and the NJ Department
and (y) any other approvals set forth in Sections 3.4 and 4.4 which are necessary to consummate the transactions
contemplated by this Agreement, including the Integrated Mergers and the Bank Merger, the failure of which to be obtained would
reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on the Surviving Corporation.
6.2 Access
to Information.
(a) Upon
reasonable notice and subject to applicable laws, each of Parent and the Company, for the purposes of verifying the representations
and warranties of the other and preparing for the Integrated Mergers and the other matters contemplated by this Agreement, shall,
and shall cause each of their respective Subsidiaries to, afford to the officers, employees, accountants, counsel, advisors and
other representatives of the other party, access, during normal business hours during the period from the date of this Agreement
to the Effective Time, to all its properties, books, contracts, commitments, personnel, information technology systems and records
(excluding Parent’s tax returns and related work papers), and each shall cooperate with the other party in preparing to execute
after the Effective Time conversion or consolidation of systems and business operations generally, and, during such period, each
of Parent and the Company shall, and shall cause its respective Subsidiaries to, make available to
the other party (i) a copy of each report,
schedule, registration statement and other document filed or received by it during such period pursuant to the requirements of
federal securities laws or federal or state banking laws (other than reports or documents which Parent or the Company, as the case
may be, is not permitted to disclose under applicable law), and (ii) all other information concerning its business, properties
and personnel as such party may reasonably request. Neither Parent nor the Company nor any of their respective Subsidiaries
shall be required to provide access to or to disclose information where such access or disclosure would violate or prejudice the
rights of Parent’s or the Company’s, as the case may be, customers, jeopardize the attorney-client privilege of the
institution in possession or control of such information (after giving due consideration to the existence of any common interest,
joint defense or similar agreement between the parties) or contravene any law, rule, regulation, order, judgment, decree, fiduciary
duty or binding agreement entered into prior to the date of this Agreement. The parties hereto will make appropriate
substitute disclosure arrangements under circumstances in which the restrictions of the preceding sentence apply.
(b) Each
of Parent and the Company shall hold all information furnished by or on behalf of the other party or any of such party’s
Subsidiaries or representatives pursuant to Section 6.2(a) in confidence to the extent required by, and in accordance with,
the provisions of the confidentiality agreement, dated December 3, 2015, between Parent and the Company (the “Confidentiality
Agreement”).
(c) No
investigation by either of the parties or their respective representatives shall affect or be deemed to modify or waive the representations
and warranties of the other set forth herein. Nothing contained in this Agreement shall give either party, directly
or indirectly, the right to control or direct the operations of the other party prior to the Effective Time. Prior to the Effective
Time, each party shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over
its and its Subsidiaries’ respective operations.
6.3 Shareholders’
Approvals.
(a) Each
of Parent and the Company shall call a meeting of its shareholders (the “Parent Meeting” and the “Company
Meeting,” respectively) to be held as soon as reasonably practicable after the S-4 is declared effective for the purpose
of obtaining the Requisite Company Vote and the Requisite Parent Vote required in connection with this Agreement, the First-Step
Merger and the issuance of shares of Parent Common Stock in connection with the First-Step Merger and, if so desired and mutually
agreed, upon other matters of the type customarily brought before an annual or special meeting of shareholders to approve a merger
agreement or otherwise approve the transactions contemplated hereby, and each shall use its reasonable best efforts to cause such
meetings to occur as promptly as reasonably practicable and on the same date.
(b) Subject
to Section 6.3(c) and Section 6.3(d), as applicable, the Board of Directors of each of Parent and the Company shall
use its reasonable best efforts to obtain from the shareholders of Parent and the Company, as the case may be, the Requisite Parent
Vote, in the case of Parent, and the Requisite Company Vote, in the case of the Company, including by communicating to its respective
shareholders its recommendation (and including
such recommendation in the Joint Proxy
Statement) that such shareholders approve (i) this Agreement and the transactions contemplated hereby, in the case of the Company,
and (ii) the issuance of shares of Parent Common Stock in connection with the First-Step Merger, in the case of Parent.
(c) Subject
to Section 8.1 and Section 8.2, if the Board of Directors of Parent, after receiving the advice of its outside counsel
and, with respect to financial matters, its financial advisors, determines in good faith that it would be reasonably likely to
result in a violation of its fiduciary duties under applicable law to continue to recommend this Agreement, then in submitting
this Agreement to its shareholders, the Board of Directors of Parent may (but shall not be required to) submit this Agreement to
Parent’s shareholders without recommendation (although the resolutions approving this Agreement as of the date hereof may
not be rescinded or amended), in which event the Board of Directors of Parent may communicate the basis for its lack of a recommendation
to Parent’s shareholders in the Joint Proxy Statement or an appropriate amendment or supplement thereto to the extent required
by law.
(d) Subject
to Section 8.1 and Section 8.2, if the Board of Directors of the Company, after receiving the advice of its outside
counsel and, with respect to financial matters, its financial advisors, determines in good faith that it would be reasonably likely
to result in a violation of its fiduciary duties under applicable law to continue to recommend this Agreement, then in submitting
this Agreement to its shareholders, the Board of Directors of the Company may (but shall not be required to) submit this Agreement
to the Company’s shareholders without recommendation (although the resolutions approving this Agreement as of the date hereof
may not be rescinded or amended), in which event the Board of Directors may communicate the basis for its lack of a recommendation
to the Company’s shareholders in the Joint Proxy Statement or an appropriate amendment or supplement thereto to the extent
required by law; provided, that the Board of Directors of the Company may not take any actions under this Section 6.3(d)
in connection with an Acquisition Proposal unless (i) such Acquisition Proposal did not result from a breach by the Company of
Section 6.12; (ii) such Acquisition Proposal constitutes a Superior Proposal; (iii) the Company gives Parent at least three
(3) business days’ prior written notice of its intention to take such action and a reasonable description of the event or
circumstances giving rise to its determination to take such action, including its basis for determining that such Acquisition Proposal
constitutes a Superior Proposal (including the latest material terms and conditions of, and the identity of the third party making,
any such Acquisition Proposal, or any amendment or modification thereof, or describe in reasonable detail such other event or circumstances)
and (iv) at the end of such notice period, the Board of Directors of the Company takes into account any amendment or modification
to this Agreement proposed by Parent (it being understood that Parent shall not have any obligation to propose
any adjustments, modifications or amendments to the terms and conditions of this Agreement), and after receiving the advice of
its outside counsel and, with respect to financial matters, its financial advisors, again determines in good faith that such Acquisition
Proposal constitutes a Superior Proposal and that it would nevertheless be reasonably likely to result in a violation of its fiduciary
duties under applicable law to continue to recommend this Agreement. Any material amendment to any Acquisition Proposal
will be deemed to be a new Acquisition Proposal for purposes of this Section 6.3(d) and will require a new determination
and notice period as referred to in this Section 6.3(d).
(e) Parent
or the Company shall adjourn or postpone the Parent Meeting or the Company Meeting, as the case may be, if, as of the time for
which such meeting is originally scheduled there are insufficient shares of Parent Common Stock or Company Common Stock, as the
case may be, represented (either in person or by proxy) to constitute a quorum necessary to conduct the business of such meeting,
or if on the date of such meeting the Company or Parent, as applicable, has not received proxies representing a sufficient number
of shares necessary to obtain the Requisite Company Vote or the Requisite Parent Vote (it being understood
that, (i) if Parent, pursuant to Section 6.3(c), submits this Agreement to Parent’s shareholders without recommendation,
or if (ii) the Company, pursuant to Section 6.3(d), submits this Agreement to Company’s shareholders without recommendation,
an adjournment or postponement of the meeting due to an insufficient quorum or the failure to obtain the Requisite Company Vote
or the Requisite Parent Vote, as applicable, shall not be required by this Section 6.3(e)). Notwithstanding anything
to the contrary herein, unless this Agreement has been terminated in accordance with its terms, each of the Parent Meeting and
the Company Meeting shall be convened and this Agreement shall be submitted to the shareholders of each of Parent and the Company
at the Parent Meeting and the Company Meeting, respectively, for the purpose of voting on the adoption of this Agreement and the
issuance of shares of Parent Common Stock in connection with the First-Step Merger, as applicable, and the other matters contemplated
hereby, and nothing contained herein shall be deemed to relieve either Parent or the Company of such obligation.
6.4 Legal
Conditions to Merger. Subject in all respects to Section 6.1 of this Agreement, each of Parent and the Company
shall, and shall cause its Subsidiaries to, use their reasonable best efforts (a) to take, or cause to be taken, all actions necessary,
proper or advisable to comply promptly with all legal requirements that may be imposed on such party or its Subsidiaries with respect
to the Integrated Mergers and the Bank Merger and, subject to the conditions set forth in Article VII hereof, to consummate
the transactions contemplated by this Agreement, and (b) to obtain (and to cooperate with the other party to obtain) any material
consent, authorization, order or approval of, or any exemption by, any Governmental Entity and any other third party that is required
to be obtained by the Company or Parent or any of their respective Subsidiaries in connection with the Integrated Mergers, the
Bank Merger and the other transactions contemplated by this Agreement.
6.5 Stock
Exchange Listing. Parent shall cause the shares of Parent Common Stock to be issued in the First-Step Merger to
be approved for listing on the NASDAQ, subject to official notice of issuance, prior to the Effective Time.
6.6 Employee
Matters.
(a) During
the period commencing at the Effective Time and ending on the first anniversary thereof, Parent shall, or shall cause the Surviving
Corporation to, provide the employees of the Company and its Subsidiaries who continue to be employed by Parent or its Subsidiaries
(including, for the avoidance of doubt, the Surviving Corporation and its Subsidiaries) immediately following the Effective Time
(the “Continuing Employees”), while employed by Parent or its Subsidiaries after the Effective Time, with base
salaries and wages no less favorable than, and with employee benefits that are substantially comparable in the aggregate to, the
base salaries, wages and employee benefits provided to similarly situated
employees of Parent and its Subsidiaries;
provided that (A) Parent may satisfy its obligation under this Section 6.6(a) by providing or causing the Surviving Corporation
to provide such Continuing Employees with base salaries and wages that are no less favorable than, and with employee benefits that
are substantially comparable in the aggregate to, the base salaries, wages and employee benefits provided by the Company or its
Subsidiaries to such Continuing Employees immediately prior to the Effective Time and (B) to satisfy its obligation under this
Section 6.6(a), Parent shall not be obligated to provide to such Continuing Employees any equity or equity-based compensation.
(b) Parent
shall, or shall cause the Surviving Corporation, to assume and honor all Company Benefit Plans in accordance with their terms. Parent
hereby acknowledges that a “change in control” (or similar phrase) within the meaning of the Company Benefit Plans
will occur at the Effective Time. Any employee of Company or Company Bank whose employment is terminated by Parent or
Parent Bank (other than for cause) and who is not a party to an employment, change in control or severance agreement or contract
providing severance payments shall, in the manner set forth on Section 6.6(b) of the Parent Disclosure Schedule, be covered and
be eligible to receive severance benefits under, and subject to the terms and conditions of, the severance plan or policy of Parent
(the “Parent Severance Plan”), set forth on Section 6.6(b) of the Parent Disclosure Schedule, provided, however
that such employee enters into a release of claims against Parent, any Parent Subsidiary, Company, Company Bank and any Subsidiary
or Affiliate of any of the above, in a customary form reasonably satisfactory to Parent. Notwithstanding the forgoing,
at the written direction of Parent to Company prior to the Closing, Company or Company Bank shall pay such cash severance benefit
to any Company or Company Subsidiary employee whose employment will be terminated at Closing.
(c) With
respect to any employee benefit plans of Parent or its Subsidiaries in which any Continuing Employees become eligible to participate
on or after the Effective Time (the “New Plans”), Parent shall or shall cause the Surviving Corporation to use
commercially reasonable efforts to: (i) waive all exclusions and waiting periods with respect to participation and coverage requirements
applicable to such employees and their eligible dependents under any New Plans, except to the extent such pre-existing conditions,
exclusions or waiting periods would apply under the analogous Company Benefit Plan, (ii) provide each such employee and their eligible
dependents with credit for any co-payments and deductibles paid prior to the Effective Time under a Company Benefit Plan (to the
same extent that such credit was given under the analogous Company Benefit Plan prior to the Effective Time) in satisfying any
applicable deductible or out-of-pocket requirements under any New Plans, and (iii) recognize all service of such employees with
the Company and its Subsidiaries for all purposes in any New Plan to the same extent that such service was taken into account under
the analogous Company Benefit Plan prior to the Effective Time; provided that the foregoing service recognition shall not
apply (A) to the extent it would result in duplication of benefits for the same period of services, (B) for purposes of any defined
benefit pension plan or benefit plan that provides retiree welfare benefits, or (C) to any benefit plan that is a frozen plan or
provides grandfathered benefits.
(d) Unless
Parent requests otherwise in writing, effective prior to the Closing, the Company shall terminate the Cape Bank Employees’
Savings & Profit Sharing Plan (the “Terminated Plan”). The Company shall provide Parent with
resolutions adopted by the
Company’s board of directors terminating
the Terminated Plan, the form and substance of which shall be subject to the reasonable advance approval of Parent. As
soon as practicable following the Effective Time, with respect to the Terminated Plan, Parent shall permit or cause its Subsidiaries
(including the Surviving Corporation) to permit the Continuing Employees to roll over their account balances and outstanding loan
balances, if any, thereunder into an “eligible retirement plan” within the meaning of Section 402(c)(8)(B) of the Code
maintained by Parent or its Subsidiaries (including the Surviving Corporation).
(e) Company
Bank shall, effective no later than immediately prior to, and contingent upon, the Effective Time (the “ESOP Termination
Date”), adopt such necessary resolutions and or amendments to the Company Bank Employee Stock Ownership Plan (the “Company
ESOP”) to (i) direct the Company ESOP trustee to deliver a sufficient number of unallocated shares of Company Common
Stock held in Company ESOP’s Suspense Account (as defined in the Company ESOP) to Company to repay any outstanding Company
ESOP loan at the Effective Time, (ii) provide for treatment of all remaining shares of Company Common Stock held in the Company
ESOP trust in accordance with Sections 2.1 and 2.2 of this Agreement, and (iii) provide that no new participants shall be admitted
to the Company ESOP on or after the ESOP Termination Date. The form and substance of such resolutions and any necessary
amendments shall be subject to the review and approval of Parent, which shall not be unreasonably withheld. Company
shall deliver to Parent an executed copy of such resolutions and any necessary amendments as soon as practicable following their
adoption by the Board of Directors of Company and shall fully comply with such resolutions and any necessary amendments. The
accounts of all participants and beneficiaries in the Company ESOP as of the ESOP Termination Date shall become fully vested as
of the ESOP Termination Date. Any unallocated shares of Company Common Stock held in the Company ESOP’s Suspense
Account after repayment of the Company ESOP loan shall be converted into Merger Consideration and shall be allocated as earnings
to the accounts of Company ESOP participants who are employed as of the ESOP Termination Date based on their account balances under
the Company ESOP as of the ESOP Termination Date. As soon as practicable after the date of this Agreement, Company shall
file or cause to be filed all necessary documents with the IRS for a determination letter for termination of the Company ESOP. As
soon as practicable following the receipt of a favorable determination letter from the IRS regarding the qualified status of the
Company ESOP upon its termination, the account balances in the Company ESOP shall either be distributed to participants and beneficiaries
or transferred to an eligible tax-qualified retirement plan or individual retirement account as a participant or beneficiary may
direct. Parent agrees to permit Company ESOP participants who become employees of Parent or Parent Subsidiaries to roll over their
account balances in the Company ESOP to the Parent Employee Stock Ownership Plan (“Parent ESOP”).
(f) Except
as provided in Section 6.6(i) below, nothing in this Agreement shall confer upon any employee, officer, director, independent
contractor or consultant of the Company or any of its Subsidiaries or affiliates any right to continue in the employ or service
of the Surviving Corporation, the Company, Parent or any Subsidiary or affiliate thereof, or shall interfere with or restrict in
any way the rights of the Surviving Corporation, the Company, Parent or any Subsidiary or affiliate thereof to discharge or terminate
the services of any employee, officer, director or consultant of the Company or any of its Subsidiaries or affiliates at any time
for any reason whatsoever, with or without cause. Nothing
in this Agreement shall be deemed to
(i) establish, amend, or modify any Company Benefit Plan, New Plan or any other benefit or employment plan, program, agreement
or arrangement, or (ii) alter or limit the ability of the Surviving Corporation or any of its Subsidiaries or affiliates to amend,
modify or terminate any particular Company Benefit Plan, New Plan or any other benefit or employment plan, program, agreement or
arrangement after the Effective Time. Without limiting the generality of the third sentence of Section 9.10,
nothing in this Agreement, express or implied, is intended to or shall confer upon any person, including without limitation any
current or former employee, officer, director, independent contractor or consultant (or any spouse or dependent of such individual)
of the Company or any of its Subsidiaries or affiliates, any right, benefit or remedy of any nature whatsoever under or by reason
of this Agreement.
6.7 Indemnification;
Directors’ and Officers’ Insurance.
(a) From
and after the Effective Time, each of Parent and the Surviving Corporation shall indemnify and hold harmless, to the fullest extent
permitted by applicable law, each present and former director, officer or employee of the Company and its Subsidiaries (in each
case, when acting in such capacity) (collectively, the “Company Indemnified Parties”) against any costs or expenses
(including reasonable attorneys’ fees), judgments, fines, losses, damages or liabilities incurred in connection with any
threatened or actual claim, action, suit, proceeding or investigation, whether civil, criminal, administrative or investigative,
whether arising before or after the Effective Time, arising out of the fact that such person is or was a director, officer or employee
of the Company or any of its Subsidiaries and pertaining to matters existing or occurring at or prior to the Effective Time, including
the transactions contemplated by this Agreement to the fullest extent as would have been permitted by the Company pursuant to the
Company Articles, the Company Bylaws, the governing or organizational documents of any Subsidiary of the Company and the MGCL immediately
prior to the Effective Time; and Parent and the Surviving Corporation shall also advance expenses as incurred by such Company Indemnified
Party to the fullest extent as would have been permitted by the Company pursuant to the Company Articles, the Company Bylaws, the
governing or organizational documents of any Subsidiary of the Company and the MGCL immediately prior to the Effective Time; provided,
that, if required, the Company Indemnified Party to whom expenses are advanced provides an undertaking to repay such advances if
it is ultimately determined that such Company Indemnified Party is not entitled to indemnification.
(b) For
a period of six (6) years after the Effective Time, the Surviving Corporation shall cause to be maintained in effect the current
policies of directors’ and officers’ liability insurance maintained by the Company (provided, that the Surviving
Corporation may substitute therefor policies with a substantially comparable insurer of at least the same coverage and amounts
containing terms and conditions which are no less advantageous to the insured) with respect to claims arising from facts or events
which occurred at or before the Effective Time; provided, however, that the Surviving Corporation shall not be obligated
to expend, on an annual basis, an amount in excess of 200% of the current annual premium paid as of the date hereof by the Company
for such insurance (the “Premium Cap”), and if such premiums for such insurance would at any time exceed the
Premium Cap, then the Surviving Corporation shall cause to be maintained policies of insurance which, in the Surviving Corporation’s
good faith determination, provide the maximum coverage available at an annual premium equal to the Premium Cap. In lieu
of the foregoing, the Company, in consultation with, but only upon the
prior written consent of Parent, may
(and at the request of Parent, the Company shall use its reasonable best efforts to) obtain at or prior to the Effective Time a
six-year “tail” policy under the Company’s existing directors and officers insurance policy providing equivalent
coverage to that described in the preceding sentence if and to the extent that the same may be obtained for an amount that, in
the aggregate, does not exceed the Premium Cap.
(c) The
provisions of this Section 6.7 shall survive the Effective Time and are intended to be for the benefit of, and shall be
enforceable by, each Company Indemnified Party and his or her heirs and representatives. If the Surviving Corporation
or any of its successors or assigns will consolidate with or merge into any other entity and not be the continuing or surviving
entity of such consolidation or merger, transfer all or substantially all of its assets or deposits to any other entity or engage
in any similar transaction, then in each case, the Surviving Corporation will cause proper provision to be made so that the successors
and assigns of the Surviving Corporation will expressly assume the obligations set forth in this Section 6.7. The obligations
of the Surviving Corporation, Parent and the Company under this Section 6.7 shall not be terminated or modified in a manner so
as to adversely affect the Company Indemnified Party or any other person entitled to the benefit of this Section 6.7 without the
prior written consent of the affected Company Indemnified Party or affected person.
6.8 Additional
Agreements. In case at any time after the Effective Time any further action is necessary or desirable to carry out
the purposes of this Agreement (including, without limitation, any merger between a Subsidiary of Parent, on the one hand, and
a Subsidiary of the Company, on the other hand) or to vest the Surviving Corporation with full title to all properties, assets,
rights, approvals, immunities and franchises of any of the parties to the Integrated Mergers, the proper officers and directors
of each party to this Agreement and their respective Subsidiaries shall take all such necessary action as may be reasonably requested
by Parent.
6.9 Advice
of Changes. Parent and the Company shall each promptly (but in no event more than 24 hours) advise the other party
of any change or event (i) that has had or is reasonably likely to have a Material Adverse Effect on it or (ii) which it believes
would or would be reasonably likely to cause or constitute a material breach of any of its representations, warranties or covenants
contained herein or that reasonably could be expected to give rise, individually or in the aggregate, to the failure of any condition
in Article VII; provided, that any failure to give notice in accordance with the foregoing with respect to any breach
shall not be deemed to constitute a violation of this Section 6.9 or the failure of any condition set forth in Section
7.2 or 7.3 to be satisfied, or otherwise constitute a breach of this Agreement by the party failing to give such notice,
in each case unless the underlying breach would independently result in a failure of the conditions set forth in Section 7.2
or 7.3 to be satisfied.
6.10 Dividends. After
the date of this Agreement, each of Parent and the Company shall coordinate with the other the declaration of any dividends in
respect of Parent Common Stock and Company Common Stock and the record dates and payment dates relating thereto, it being the intention
of the parties hereto that holders of Company Common Stock shall not receive two dividends, or fail to receive one dividend, in
any quarter with respect to their shares of Company Common Stock and any shares of Parent Common Stock any such holder receives
in exchange therefor in the First-Step Merger.
6.11 Corporate
Governance. Effective as of the Effective Time, Parent and Parent Bank, respectively, shall (i) increase the size of the Board
of Directors of Parent and Parent Bank to ten (10) members and (ii) appoint Michael D. Devlin to the Board of Directors of Parent
and Parent Bank, respectively, as a member of the class of directors that has a term expiring at the 2018 annual meeting of the
stockholders. In the event that Mr. Devlin is unable to serve, Parent and Parent Bank, respectively, shall select and appoint a
director from the existing Board of Directors of the Company to serve as a member of the class of directors of Parent and Parent
Bank, respectively, for a term to expire at the 2018 annual meeting of the stockholders.
6.12 Acquisition
Proposals.
(a) The
Company agrees that it will not, and will cause its Subsidiaries and its and their officers, directors, agents, advisors and representatives
(collectively, “Representatives”) not to, directly or indirectly, (i) initiate, solicit, knowingly encourage
or knowingly facilitate inquiries or proposals with respect to, (ii) engage or participate in any negotiations with any person
concerning, or (iii) provide any confidential or nonpublic information or data to, or have or participate in any discussions with,
any person relating to, any Acquisition Proposal, except to notify such person of the existence of the provisions of this Section
6.12(a); provided, that, prior to the date of the Company Meeting, in the event the Company receives an unsolicited
bona fide written Acquisition Proposal that did not result from a breach of this Section 6.12(a), it may, and may permit
its Subsidiaries and its and its Subsidiaries’ Representatives to, furnish or cause to be furnished nonpublic information
or data and participate in such negotiations or discussions to the extent that its Board of Directors concludes in good faith (after
receiving the advice of its outside counsel, and with respect to financial matters, its financial advisors) that (1) such Acquisition
Proposal constitutes or is reasonably likely to lead to a Superior Proposal and (2) failure to take such actions would be reasonably
likely to result in a violation of its fiduciary duties under applicable law; provided, further, that, prior to providing
any nonpublic information or data, or participating in any negotiations or discussions, in each case, permitted pursuant to the
foregoing proviso, the Company shall have entered into a confidentiality agreement with such third party on terms no less favorable
to it than the Confidentiality Agreement, which confidentiality agreement shall not provide such person with any exclusive right
to negotiate with the Company. The Company will, and will cause its Representatives to, immediately cease and cause
to be terminated any activities, discussions or negotiations conducted before the date of this Agreement with any person other
than Parent with respect to any Acquisition Proposal and will use its reasonable best efforts, subject to applicable law, to (x)
enforce any confidentiality, standstill or similar agreement relating to an Acquisition Proposal and (y) within ten (10) business
days after the date hereof, request and confirm the return or destruction of any confidential information provided to any person
(other than the Company) pursuant to such agreement. The Company will promptly (and in any event within twenty-four
(24) hours) advise Parent following receipt of any Acquisition Proposal or any inquiry which could reasonably be expected to lead
to an Acquisition Proposal, and the substance thereof (including the terms and conditions of and the identity of the person making
such inquiry or Acquisition Proposal, copies of any written Acquisition Proposal and written summaries of any material oral communications
relating to an Acquisition Proposal), and will keep Parent apprised of any related developments, discussions and negotiations on
a current basis, including any amendments to or revisions of the terms of such inquiry or Acquisition Proposal.
(b) As
used in this Agreement,
(i) “Acquisition
Proposal” shall mean, other than the transactions contemplated by this Agreement, any offer, proposal or inquiry relating
to, or any third party indication of interest in, (i) any acquisition or purchase, direct or indirect, of 25% or more of the consolidated
assets of the Company and its Subsidiaries or 25% or more of any class of equity or voting securities of the Company or its Subsidiaries
whose assets, individually or in the aggregate, constitute more than 25% of the consolidated assets of the Company, (ii) any tender
offer (including a self-tender offer) or exchange offer that, if consummated, would result in such third party beneficially owning
25% or more of any class of equity or voting securities of the Company or its Subsidiaries whose assets, individually or in the
aggregate, constitute more than 25% of the consolidated assets of the Company, or (iii) a merger, consolidation, share exchange,
business combination, reorganization, recapitalization, liquidation, dissolution or other similar transaction involving the Company
or its Subsidiaries whose assets, individually or in the aggregate, constitute more than 25% of the consolidated assets of the
Company; and
(ii) “Superior
Proposal” shall mean any bona fide written offer or proposal made by a third party to consummate an Acquisition Proposal
that the Company’s Board of Directors determines in good faith (after receiving the advice of its outside counsel and, with
respect to financial matters, its financial advisors) (1) would, if consummated, result in the acquisition of all, but not less
than all, of the issued and outstanding shares of Company Common Stock or all, or substantially all, of the assets of the Company;
(2) would result in a transaction that (A) involves consideration to the holders of the shares of Company Common Stock that is
more favorable, from a financial point of view, than the consideration to be paid to the shareholders of the Company pursuant to
this Agreement, considering, among other things, the nature of the consideration being offered and any material regulatory approvals
or other risks associated with the timing of the proposed transaction beyond, or in addition to, those specifically contemplated
hereby, and which proposal is not conditioned upon obtaining financing and (B) is, in light of the other terms of such proposal,
more favorable to the shareholders of the Company than the Integrated Mergers and the transactions contemplated by this Agreement;
and (3) is reasonably likely to be completed on the terms proposed, in each case, taking into account all legal, financial, regulatory
and other aspects of the Acquisition Proposal.
(c) Nothing
contained in this Agreement shall prevent the Company or its Board of Directors from complying with Rule 14d-9 and Rule 14e-2 under
the Exchange Act with respect to an Acquisition Proposal; provided, that such Rules will in no way eliminate or modify the
effect that any action pursuant to such Rules would otherwise have under this Agreement.
6.13 Board
of Directors and Committee Meetings. Subsequent to the receipt of all Requisite Regulatory Approvals, the Company
shall permit representatives of Parent and
Parent Bank to attend any meeting of its
board of directors or the executive and loan committees thereof as an observer, subject to the Confidentiality Agreement; provided,
that the Company shall not be required to permit such representatives to remain present during any confidential discussions of
this Agreement and the transactions contemplated hereby or any Acquisition Proposal or during any other matter (a) that the Board
of Directors of the Company has reasonably determined to be confidential with respect to the participation of Parent or Parent
Bank or (b) that the Company would not be required to disclose under Section 6.2 of this Agreement.
6.14 Public
Announcements. The Company and Parent shall each use their reasonable best efforts to develop a joint communications
plan, to ensure that all press releases and other public statements with respect to the transactions contemplated hereby shall
be consistent with such joint communications plan, and except in respect of any announcement required by applicable law, or by
obligations pursuant to any listing agreement with or rules of any securities exchange, to consult with each other before issuing
any press release or, to the extent practical, otherwise making any public statement with respect to this Agreement or the transactions
contemplated hereby.
6.15 Change
of Method. The Company and Parent shall be empowered, upon their mutual agreement, at any time prior to the Effective
Time, to change the method or structure of effecting the combination of the Company and Parent (including the provisions of Article
I), if and to the extent they both deem such change to be necessary, appropriate or desirable; provided, however,
that no such change shall (i) alter or change the amount or kind of the Merger Consideration provided for in this Agreement, (ii)
adversely affect the Tax treatment of the Company’s shareholders or Parent’s shareholders pursuant to this Agreement,
(iii) adversely affect the Tax treatment of the Company or Parent pursuant to this Agreement or (iv) materially impede or delay
the consummation of the transactions contemplated by this Agreement in a timely manner. The Parties agree to reflect
any such change in an appropriate amendment to this Agreement executed by both parties in accordance with Section 8.3.
6.16 Restructuring
Efforts. If either the Company or Parent shall have failed to obtain the Requisite Company Vote or the Requisite
Parent Vote at the duly convened Company Meeting or Parent Meeting, as applicable, or any adjournment or postponement thereof,
each of the parties shall in good faith use its reasonable best efforts to negotiate a restructuring of the transaction provided
for herein (it being understood that neither party shall have any obligation to alter or change any material terms, including the
amount or kind of the consideration to be issued to holders of the capital stock of the Company as provided for in this Agreement,
in a manner adverse to such party or its shareholders) and/or resubmit this Agreement or the transactions contemplated hereby (or
as restructured pursuant to this Section 6.16) to its respective shareholders for approval.
6.17 Takeover
Statutes. None of the Company, Parent or their respective Boards of Directors shall take any action that would cause
any Takeover Statute to become applicable to this Agreement, the Integrated Mergers, or any of the other transactions contemplated
hereby, and each shall take all necessary steps to exempt (or ensure the continued exemption of) the Integrated Mergers and the
other transactions contemplated hereby from any applicable Takeover Statute now or hereafter in effect. If any Takeover
Statute may become, or
may purport to be, applicable to the transactions
contemplated hereby, each of Parent and the Company and the members of their respective Boards of Directors will grant such approvals
and take such actions as are necessary so that the transactions contemplated by this Agreement may be consummated as promptly as
practicable on the terms contemplated hereby and thereby and otherwise act to eliminate or minimize the effects of any Takeover
Statute on any of the transactions contemplated by this Agreement, including, if necessary, challenging the validity or applicability
of any such Takeover Statute.
6.18 Exemption
from Liability Under Section 16(b). The Company and Parent agree that, in order to most effectively compensate
and retain the Company Insiders (as defined below), both prior to and after the Effective Time, it is desirable that the Company
Insiders not be subject to a risk of liability under Section 16(b) of the Exchange Act to the fullest extent permitted by applicable
law in connection with the conversion of shares of Company Common Stock and the Company Equity Awards in the First-Step Merger,
and for that compensatory and retentive purpose agree to the provisions of this Section 6.18. Assuming the Company
delivers to Parent in a reasonably timely fashion prior to the Effective Time accurate information regarding those officers and
directors of the Company subject to the reporting requirements of Section 16(a) of the Exchange Act (the “Company Insiders”),
the Board of Directors of Parent and of the Company, or a committee of non-employee directors thereof (as such term is defined
for purposes of Rule 16b-3(d) under the Exchange Act), shall reasonably promptly thereafter, and in any event prior to the Effective
Time, take all such steps as may be required to cause (in the case of the Company) any dispositions of Company Common Stock or
the Company Equity Awards by the Company Insiders, and (in the case of Parent) any acquisitions of Parent Common Stock by any
Company Insiders who, immediately following the Integrated Mergers, will be officers or directors of the Surviving Corporation
subject to the reporting requirements of Section 16(a) of the Exchange Act, in each case pursuant to the transactions contemplated
by this Agreement, to be exempt from liability pursuant to Rule 16b-3 under the Exchange Act to the fullest extent permitted by
applicable law.
6.19 No
Control of Other Party’s Business. Nothing contained in this Agreement shall give Parent, directly or indirectly, the
right to control or direct the operations of the Company or its Subsidiaries prior to the Effective Time, and nothing contained
in this Agreement shall give the Company, directly or indirectly, the right to control or direct the operations of Parent or its
Subsidiaries prior to the Effective Time. Prior to the Effective Time, each of Parent and the Company shall exercise, consistent
with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective
operations.
6.20 Parent
Voting Agreements. Parent shall use its reasonable best efforts to cause each of the directors and certain executive
officers of Parent to, as soon as reasonably practicable following the date of this Agreement (and in any event no later than the
30th day following the date hereof), enter into separate voting agreements with the Company in respect of the Requisite Parent
Vote, on such terms and conditions as are customary for agreements of that type (the “Parent Voting Agreements”).
Article
VII
CONDITIONS
PRECEDENT
7.1 Conditions
to Each Party’s Obligation To Effect the Integrated Mergers. The respective obligations of the parties to
effect the Integrated Mergers shall be subject to the satisfaction at or prior to the Effective Time of the following conditions:
(a) Shareholder
Approval. The Requisite Parent Vote and the Requisite Company Vote shall have been obtained.
(b) NASDAQ
Listing. The shares of Parent Common Stock that shall be issuable pursuant to this Agreement shall have been authorized
for listing on the NASDAQ, subject to official notice of issuance.
(c) Requisite
Regulatory Approvals. All Requisite Regulatory Approvals shall have been obtained and shall remain in full force
and effect and all statutory waiting periods in respect thereof shall have expired, and no such Requisite Regulatory Approval shall
have resulted in the imposition of any Materially Burdensome Regulatory Condition.
(d) S-4. The
S-4 shall have become effective under the Securities Act and no stop order suspending the effectiveness of the S-4 shall have been
issued and no proceedings for that purpose shall have been initiated or threatened by the SEC and not withdrawn.
(e) No
Injunctions or Restraints; Illegality. No order, injunction or decree issued by any court or agency of competent
jurisdiction or other legal restraint or prohibition preventing the consummation of the Integrated Mergers or any of the other
transactions contemplated by this Agreement shall be in effect. No statute, rule, regulation, order, injunction or decree
shall have been enacted, entered, promulgated or enforced by any Governmental Entity which prohibits or makes illegal consummation
of the Integrated Mergers.
7.2 Conditions
to Obligations of Parent. The obligation of Parent to effect the Integrated Mergers is also subject to the satisfaction,
or waiver by Parent, at or prior to the Effective Time, of the following conditions:
(a) Representations
and Warranties. The representations and warranties of the Company set forth in Sections 3.2(a), 3.7, 3.8(a)
and 3.27 (in each case after giving effect to the lead in to Article III) shall be true and correct (other than,
in the case of Section 3.2(a), such failures to be true and correct as are de minimis) in each case as of the date of this
Agreement and (except to the extent such representations and warranties speak as of an earlier date, in which case such representations
and warranties shall be so true and correct as of such earlier date) as of the Closing Date as though made on and as of the Closing
Date, and the representations and warranties of the Company set forth in Sections 3.1(a), 3.1(b), 3.2(b),
and 3.3(a) (in each case, after giving effect to the lead in to Article III) shall be true and correct in all material
respects as of the date of this Agreement and (except to the extent such representations and warranties speak as of an earlier
date, in which case such representations and warranties shall be so true and correct as of such earlier date) as of the Closing
Date as though made on and
as of the Closing Date. All
other representations and warranties of the Company set forth in this Agreement (read without giving effect to any qualification
as to materiality or Material Adverse Effect set forth in such representations or warranties but, in each case, after giving effect
to the lead in to Article III) shall be true and correct in all respects as of the date of this Agreement and (except to
the extent such representations and warranties speak as of an earlier date, in which case such representations and warranties shall
be so true and correct as of such earlier date) as of the Closing Date as though made on and as of the Closing Date; provided,
however, that for purposes of this sentence, such representations and warranties shall be deemed to be true and correct
unless the failure or failures of such representations and warranties to be so true and correct, either individually or in the
aggregate, and without giving effect to any qualification as to materiality or Material Adverse Effect set forth in such representations
or warranties, has had or would reasonably be expected to have a Material Adverse Effect on the Company or the Surviving Corporation. Parent
shall have received a certificate signed on behalf of the Company by the Chief Executive Officer and the Chief Financial Officer
of the Company to the foregoing effect.
(b) Performance
of Obligations of the Company. The Company shall have complied in all respects with its obligations under Section
5.2(t) of this Agreement and shall have performed in all material respects the other obligations required to be performed by
it under this Agreement at or prior to the Closing Date, and Parent shall have received a certificate signed on behalf of the Company
by the Chief Executive Officer and the Chief Financial Officer of the Company to such effect.
(c) Tax
Opinion. Parent shall have received the written opinion of Skadden, Arps, Slate, Meagher & Flom LLP, in form
and substance reasonably satisfactory to Parent, dated as of the Closing Date, to the effect that, on the basis of facts, representations
and assumptions set forth or referred to in such opinion, that are consistent with the state of facts existing in the Effective
Time, the Integrated Mergers shall together be treated as an integrated transaction that qualifies as a “reorganization”
within the meaning of Section 368(a) of the Code. In rendering such opinion, Skadden, Arps, Slate, Meagher & Flom
LLP may rely upon the certificates, representations and covenants referred to in Section 5.4.
(d) FIRPTA
Certificate. The Company shall have delivered to Parent a duly executed certificate, in form and substance as prescribed
by Treasury regulations promulgated under Section 1445 of the Code, stating that the Company is not, and has not been, during the
relevant period specified in Section 897(c)(1)(A)(ii) of the Code, a “United States real property holding corporation”
within the meaning of Section 897(c) of the Code.
7.3 Conditions
to Obligations of the Company. The obligation of the Company to effect the Integrated Mergers is also subject to
the satisfaction or waiver by the Company at or prior to the Effective Time of the following conditions:
(a) Representations
and Warranties. The representations and warranties of Parent set forth in Sections 4.2(a), 4.7 and
4.8 (in each case, after giving effect to the lead in to Article IV) shall be true and correct (other than, in the
case of Section 4.2(a), such failures to be true and correct as are de minimis) in each case as of the date of this Agreement
and (except to the extent such representations and warranties speak as of an earlier date, in which case such
representations and warranties shall
be so true and correct as of such earlier date) as of the Closing Date as though made on and as of the Closing Date, and the representations
and warranties of Parent set forth in Sections 4.1(a), 4.1(b), 4.2(b) and 4.3(a) (in each case, after
giving effect to the lead in to Article IV) shall be true and correct in all material respects as of the date of this Agreement
and (except to the extent such representations and warranties speak as of an earlier date, in which case such representations and
warranties shall be so true and correct as of such earlier date) as of the Closing Date as though made on and as of the Closing
Date. All other representations and warranties of Parent set forth in this Agreement (read without giving effect to
any qualification as to materiality or Material Adverse Effect set forth in such representations or warranties but, in each case,
after giving effect to the lead in to Article IV) shall be true and correct in all respects as of the date of this Agreement
and (except to the extent such representations and warranties speak as of an earlier date, in which case such representations and
warranties shall be so true and correct as of such earlier date) as of the Closing Date as though made on and as of the Closing
Date, provided, however, that for purposes of this sentence, such representations and warranties shall be deemed
to be true and correct unless the failure or failures of such representations and warranties to be so true and correct, either
individually or in the aggregate, and without giving effect to any qualification as to materiality or Material Adverse Effect set
forth in such representations or warranties, has had or would reasonably be expected to have a Material Adverse Effect on Parent. The
Company shall have received a certificate signed on behalf of Parent by the Chief Executive Officer and the Chief Financial Officer
of Parent to the foregoing effect.
(b) Performance
of Obligations of Parent. Parent shall have performed in all material respects the obligations required to be performed
by it under this Agreement at or prior to the Closing Date, and the Company shall have received a certificate signed on behalf
of Parent by the Chief Executive Officer and the Chief Financial Officer of Parent to such effect.
(c) Tax
Opinion. The Company shall have received the written opinion of Luse Gorman, PC, in form and substance reasonably
satisfactory to the Company, dated as of the Closing Date, to the effect that, on the basis of facts, representations and assumptions
set forth or referred to in such opinion, that are consistent with the state of facts existing in the Effective Time, the Integrated
Mergers shall together be treated as an integrated transaction that qualifies as a “reorganization” within the meaning
of Section 368(a) of the Code. In rendering such opinion, Luse Gorman, PC may rely upon the certificates, representations
and covenants referred to in Section 5.4.
Article
VIII
TERMINATION
AND AMENDMENT
8.1 Termination. This
Agreement may be terminated at any time prior to the Effective Time, whether before or after the obtainment of the Requisite Company
Vote or the Requisite Parent Vote:
(a) by
mutual consent of Parent and the Company in a written instrument, if the Board of Directors of each so determines by a vote of
a majority of the members of its entire Board;
(b) by
either the Board of Directors of Parent or the Board of Directors of the Company if any Governmental Entity that must grant a Requisite
Regulatory Approval has denied approval of the Integrated Mergers or the other transactions contemplated hereby and such denial
has become final and nonappealable or any Governmental Entity of competent jurisdiction shall have issued a final nonappealable
order permanently enjoining or otherwise prohibiting or making illegal the consummation of the transactions contemplated by this
Agreement, unless the failure to obtain a Requisite Regulatory Approval shall be due to the failure of the party seeking to terminate
this Agreement to perform or observe the covenants and agreements of such party set forth herein;
(c) by
either the Board of Directors of Parent or the Board of Directors of the Company if the Integrated Mergers shall not have been
consummated on or before the one (1) year anniversary of the date of this Agreement (the “Termination Date”),
unless the failure of the Closing to occur by such date shall be due to the failure of the party seeking to terminate this Agreement
to perform or observe the covenants and agreements of such party set forth herein;
(d) by
either the Board of Directors of Parent or the Board of Directors of the Company (provided, that the terminating party is
not then in material breach of any representation, warranty, covenant or other agreement contained herein) if there shall have
been a breach of any of the covenants or agreements or any of the representations or warranties (or any such representation or
warranty shall cease to be true) set forth in this Agreement on the part of the Company, in the case of a termination by Parent,
or Parent, in the case of a termination by the Company, which breach or failure to be true, either individually or in the aggregate
with all other breaches by such party (or failures of such representations or warranties to be true), would constitute, if occurring
or continuing on the Closing Date, the failure of a condition set forth in Section 7.2, in the case of a termination by
Parent, or Section 7.3, in the case of a termination by the Company, and which is not cured within 45 days following written
notice to the Company, in the case of a termination by Parent, or Parent, in the case of a termination by the Company, or by its
nature or timing cannot be cured during such period (or such fewer days as remain prior to the Termination Date);
(e) by
the Company, if the Board of Directors of Parent shall have (i) failed to recommend in the Joint Proxy Statement that the shareholders
of Parent approve the issuance of shares of Parent Common Stock in connection with the First-Step Merger, or withdrawn, modified
or qualified such recommendation in a manner adverse to the Company, or resolved to do so, or failed to reaffirm such recommendation
within two (2) business days after the Company requests in writing that such action be taken, or (ii) breached its obligations
under Section 6.3 in any material respect;
(f) by
Parent, if the Board of Directors of the Company shall have (i) failed to recommend in the Joint Proxy Statement that the shareholders
of the Company adopt this Agreement, or withdrawn, modified or qualified such recommendation in a manner adverse to Parent, or
resolved to do so, or failed to reaffirm such recommendation within two (2) business days after Parent requests in writing that
such action be taken, or failed to recommend against acceptance of a tender offer or exchange offer for outstanding Company Common
Stock that has been publicly disclosed (other than by Parent or an affiliate of Parent) within ten (10) business days after the
commencement of such tender or exchange offer, in any such case
whether or not permitted by the terms
hereof, (ii) recommended or endorsed an Acquisition Proposal, or (iii) breached its obligations under Sections 6.3 or 6.12
in any material respect; or
(g) By
the Company, if its Board of Directors so determines by a vote of a majority of the members of its entire board within a five (5)
day period commencing on the Determination Date, if both of the following conditions are satisfied, such termination to be effective
on the tenth (10th) day following the Determination Date: (i) the Parent Market Value on the Determination Date is less
than $15.74 and (ii) the number obtained by dividing the Parent Market Value on the Determination Date by the Initial Parent Market
Value is less than the number obtained by dividing (x) the Final Index Price by (y) the Initial Index Price minus 0.15; subject,
however, to the following three sentences. If the Company elects to exercise its termination right pursuant to
this Section 8.1(g), it shall promptly (and in any event no later than the last day of the five (5) day period commencing
on the Determination Date) notify Parent in writing of such election. During the five (5) day period commencing with
Parent’s receipt of such notice, Parent shall have the option to increase the Exchange Ratio to equal the lesser of (x) a
quotient, the numerator of which is equal to the product of the Initial Parent Market Value, the Exchange Ratio (as then in effect),
and the Index Ratio minus 0.15 and the denominator of which is equal to the Parent Market Value on the Determination Date; or (y)
the quotient determined by dividing the Initial Parent Market Value by the Parent Market Value on the Determination Date, and multiplying
such quotient by the product of the Exchange Ratio (as then in effect) and 0.80. If within such five (5) day period,
Parent delivers written notice to the Company that it intends to proceed with the Integrated Mergers by paying such additional
consideration as contemplated by the preceding sentence, and notifies the Company of the revised Exchange Ratio, then no termination
shall be permitted by, or shall have occurred pursuant to, this Section 8.1(g), and this Agreement shall remain in full
force and effect in accordance with its terms (except that the Exchange Ratio shall have been so modified). If Parent
or any company belonging to the Index declares or effects a stock dividend, reclassification, recapitalization, split-up, combination,
exchange of shares or similar transaction between the date of this Agreement and the Determination Date, the prices for the common
stock of such company shall be appropriately adjusted for the purposes of applying this Section 8.1(g). For purposes of
this Agreement, the following terms shall have the following meanings:
(i) The
“Determination Date” means the first date on which all Requisite Regulatory Approvals (and waivers, if applicable)
necessary for consummation of the Integrated Mergers have been received (disregarding any waiting period).
(ii) The
“Final Index Price” means the average of the daily closing value of the Index, for the ten (10) consecutive
trading days immediately preceding the Determination Date.
(iii) The
“Index” means the NASDAQ Bank Index or, if such Index is not available, such substitute or similar Index as
substantially replicates the NASDAQ Bank Index.
(iv) The
“Index Ratio” means the Final Index Price divided by the Initial Index Price.
(v) The
“Initial Index Price” means the closing value of the Index on the date of this Agreement.
(vi) The
“Initial Parent Market Value” means, $19.67, adjusted as indicated in the last sentence of Section 8.1(g).
(vii) The
“Parent Market Value” means, as of any specified date, the average of the daily closing sales prices of a share
of Parent Common Stock as reported on the NASDAQ for the ten (10) consecutive trading days immediately preceding such specified
date.
8.2 Effect
of Termination.
(a) In
the event of termination of this Agreement by either Parent or the Company as provided in Section 8.1, this Agreement shall
forthwith become void and have no effect, and none of Parent, the Company, any of their respective Subsidiaries or any of the officers
or directors of any of them shall have any liability of any nature whatsoever hereunder, or in connection with the transactions
contemplated hereby, except that (i) Section 6.2(b) and this Section 8.2 and Article IX shall survive any
termination of this Agreement, and (ii) notwithstanding anything to the contrary contained in this Agreement, neither Parent nor
the Company shall be relieved or released from any liabilities or damages arising out of its fraud or knowing, intentional and
material breach of any provision of this Agreement.
(b) In
the event that after the date of this Agreement and prior to the termination of this Agreement, a bona fide Acquisition Proposal
shall have been made known to senior management or the Board of Directors of the Company or has been made directly to its shareholders
generally or any person shall have publicly announced (and not withdrawn) an Acquisition Proposal with respect to the Company and
(x) (A) thereafter this Agreement is terminated by either Parent or the Company pursuant to Section 8.1(c) without the Requisite
Company Vote having been obtained or (B) thereafter this Agreement is terminated by Parent pursuant to Section 8.1(d), and
(y) on or prior to the date that is eighteen (18) months after the date of such termination, the Company enters into a definitive
agreement or consummates a transaction with respect to an Acquisition Proposal (whether or not the same Acquisition Proposal as
that referred to above), then the Company shall, on the earlier of the date it enters into such definitive agreement and the date
of consummation of such transaction, pay Parent, by wire transfer of same day funds, a fee equal to $7,200,000.00 (the “Termination
Fee”).
(c) In
the event that this Agreement is terminated by Parent pursuant to Section 8.1(f), then the Company shall pay Parent, by
wire transfer of same day funds, a fee equal to the Termination Fee on the date of termination.
(d) In
the event that this Agreement is terminated by the Company pursuant to Section 8.1(e), then Parent shall pay the Company,
by wire transfer of same day funds, a fee equal to the Termination Fee on the date of termination.
(e) Each
of Parent and the Company acknowledges that the agreements contained in this Section 8.2 are an integral part of the transactions
contemplated by this Agreement, and that, without these agreements, the other party would not enter into this
Agreement; accordingly, if Parent or
the Company fails promptly to pay the amount due pursuant to this Section 8.2, and, in order to obtain such payment, the
other party commences a suit which results in a judgment against the non-paying party for the Termination Fee, such non-paying
party shall pay the costs and expenses of the other party (including attorneys’ fees and expenses) in connection with such
suit. In addition, if Parent or the Company fails to pay the amounts payable pursuant to this Section 8.2, then
such party shall pay interest on such overdue amounts at a rate per annum equal to the “prime rate” (as announced by
JPMorgan Chase & Co. or any successor thereto) in effect on the date on which such payment was required to be made for the
period commencing as of the date that such overdue amount was originally required to be paid.
8.3 Amendment. Subject
to compliance with applicable law, this Agreement may be amended by the parties hereto, by action taken or authorized by their
respective Boards of Directors, at any time before or after approval of the matters presented in connection with the Integrated
Mergers by the shareholders of Parent and the Company; provided, however, that after adoption of this Agreement by
the shareholders of the Company or the approval of the issuance of shares of Parent Common Stock in connection with the First-Step
Merger by the shareholders of Parent, there may not be, without further approval of such shareholders, any amendment of this Agreement
that requires further approval under applicable law. This Agreement may not be amended except by an instrument in writing
signed on behalf of each of the parties hereto.
8.4 Extension;
Waiver. At any time prior to the Effective Time, the parties hereto, by action taken or authorized by their respective
Boards of Directors, may, to the extent legally allowed, extend the time for the performance of any of the obligations or other
acts of the other parties hereto, waive any inaccuracies in the representations and warranties contained herein or in any document
delivered pursuant hereto, and waive compliance with any of the agreements or satisfaction of any conditions contained herein;
provided, however, that after adoption of this Agreement by the shareholders of the Company or the approval of the
issuance of shares of Parent Common Stock in connection with the First-Step Merger by the shareholders of Parent, there may not
be, without further approval of such shareholders, any extension or waiver of this Agreement or any portion thereof that requires
further approval under applicable law. Any agreement on the part of a party hereto to any such extension or waiver shall
be valid only if set forth in a written instrument signed on behalf of such party, but such extension or waiver or failure to insist
on strict compliance with an obligation, covenant, agreement or condition shall not operate as a waiver of, or estoppel with respect
to, any subsequent or other failure.
Article
IX
GENERAL
PROVISIONS
9.1 Nonsurvival
of Representations, Warranties and Agreements. None of the representations, warranties, covenants and agreements
in this Agreement or in any instrument delivered pursuant to this Agreement (other than the Confidentiality Agreement, which shall
survive in accordance with its terms) shall survive the Effective Time, except for Section 6.7 and for those other covenants
and agreements contained herein and therein which by their terms apply in whole or in part after the Effective Time.
9.2 Expenses. Except
as expressly provided herein, all costs and expenses incurred in connection with this Agreement and the transactions contemplated
hereby shall be paid by the party incurring such expense; provided, however, that the costs and expenses of printing
and mailing the Joint Proxy Statement and all filing and other fees paid to the SEC in connection with the Integrated Mergers shall
be borne equally by Parent and the Company.
9.3 Notices. All
notices and other communications hereunder shall be in writing and shall be deemed given if delivered personally, telecopied or
emailed (with confirmation), mailed by registered or certified mail (return receipt requested) or delivered by an express courier
(with confirmation) to the parties at the following addresses (or at such other address for a party as shall be specified by like
notice):
if to the Company, to:
Cape Bancorp, Inc
201 Shore Road
Linwood, NJ 08221
| Attention: | Michael D. Devlin |
| Email: | mdevlin@capebanknj.com |
With a copy (which shall not constitute notice)
to:
Luse Gorman, PC
5335 Wisconsin Avenue, NW, Suite 780
Washington, D.C. 20015
and
if to Parent, to:
OceanFirst Financial Corp.
975 Hooper Avenue
Toms River, New Jersey 08753
| Attention: | Christopher D. Maher |
| Email: | cmaher@oceanfirst.com |
With a copy (which shall not constitute notice)
to:
Skadden, Arps, Slate, Meagher & Flom LLP
Four Times Square
New York, New York 10036
| Attention: | David C. Ingles |
| Email: | David.Ingles@skadden.com |
9.4 Interpretation. The
parties have participated jointly in negotiating and drafting this Agreement. In the event that an ambiguity or a question of intent
or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties, and no presumption or burden
of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provision of this Agreement. When
a reference is made in this Agreement to Articles, Sections, Exhibits or Schedules, such reference shall be to an Article or Section
of or Exhibit or Schedule to this Agreement unless otherwise indicated. The table of contents, defined term index and
headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation
of this Agreement. Whenever the words “include,” “includes” or “including” are used
in this Agreement, they shall be deemed to be followed by the words “without limitation.” References to “the
date hereof” shall mean the date of this Agreement. As used in this Agreement, the “knowledge of the Company”
means the actual knowledge (after due inquiry) of any of the executive officers of the Company, and the “knowledge of Parent”
means the actual knowledge (after due inquiry) of any of the executive officers of Parent. As used herein, (i) the term
“person” means any individual, corporation (including not-for-profit), general or limited partnership, limited liability
company, joint venture, estate, trust, association, organization, Governmental Entity or other entity of any kind or nature, (ii)
an “affiliate” of a specified person is any person that directly or indirectly controls, is controlled by, or is under
common control with, such specified person, (iii) unless the context otherwise requires, the term “party” means a party
to this agreement irrespective of whether such term is followed by the word “hereto” or the words “to this Agreement”
and (iv) the term “made available” means any document or other information that was (a) provided in writing by one
party or its representatives to the other party and its representatives prior to the date hereof, (b) included in the virtual data
room of a party prior to the date hereof or (c) filed by a party with the SEC and publicly available on EDGAR prior to the date
hereof. The Company Disclosure Schedule and the Parent Disclosure Schedule, as well as all other schedules and all exhibits
hereto, shall be deemed part of this Agreement and included in any reference to this Agreement.
9.5 Counterparts. This
Agreement may be executed (including in any manner permitted by Section 9.12 of this Agreement) in counterparts, all of
which shall be considered one and the same agreement and shall become effective when counterparts have been signed by each of the
parties and delivered to the other parties, it being understood that all parties need not sign the same counterpart.
9.6 Entire
Agreement. This Agreement (including the documents and the instruments referred to herein) together with the Confidentiality
Agreement constitutes the entire agreement among the parties and supersedes all prior agreements and understandings, both written
and oral, among the parties with respect to the subject matter hereof.
9.7 Governing
Law; Jurisdiction.
(a) This
Agreement shall be governed and construed in accordance with the laws of the State of Delaware, without regard to any applicable
conflicts of law (except that the matters relating to the fiduciary duties of the Board of Directors of the Company shall be subject
to the laws of the State of Maryland).
(b) Each
party agrees that it will bring any action or proceeding in respect of any claim arising out of or related to this Agreement or
the transactions contemplated hereby exclusively in any federal or state court sitting in the State of Delaware (the “Chosen
Courts”), and, solely in connection with claims arising under this Agreement or the transactions that are the subject
of this Agreement, (i) irrevocably submits to the exclusive jurisdiction of the Chosen Courts, (ii) waives any objection to laying
venue in any such action or proceeding in the Chosen Courts, (iii) waives any objection that the Chosen Courts are an inconvenient
forum or do not have jurisdiction over any party and (iv) agrees that service of process upon such party in any such action or
proceeding will be effective if notice is given in accordance with Section 9.3.
9.8 Waiver
of Jury Trial. EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY
TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW AT THE TIME OF INSTITUTION OF THE APPLICABLE LITIGATION, ANY RIGHT SUCH PARTY MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT: (I) NO REPRESENTATIVE, AGENT OR ATTORNEY
OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO
ENFORCE THE FOREGOING WAIVER, (II) EACH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (III) EACH PARTY
MAKES THIS WAIVER VOLUNTARILY, AND (IV) EACH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL
WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.8.
9.9 Assignment;
Third Party Beneficiaries. Neither this Agreement nor any of the rights, interests or obligations shall be assigned
by any of the parties hereto (whether by operation of law or otherwise) without the prior written consent of the other party. Any
purported assignment in contravention hereof shall be null and void. Subject to the preceding sentence, this Agreement
will be binding upon, inure to the benefit of and be enforceable by the parties and their respective successors and permitted assigns. Except
as otherwise specifically provided in Section 6.7, this Agreement (including the documents and instruments referred to herein)
is not intended to, and does not, confer upon any person other than the parties hereto any rights or remedies hereunder, including
the right to rely upon the representations and warranties set forth herein. The representations and warranties in this
Agreement are the product of negotiations among the parties hereto and are for the sole benefit of the parties. Any
inaccuracies in such representations and warranties are subject to waiver by the parties hereto in
accordance herewith without notice or liability
to any other person. In some instances, the representations and warranties in this Agreement may represent an allocation
among the parties hereto of risks associated with particular matters regardless of the knowledge of any of the parties hereto.
Consequently, persons other than the parties may not rely upon the representations and warranties in this Agreement as characterizations
of actual facts or circumstances as of the date of this Agreement or as of any other date.
9.10 Specific
Performance. The parties hereto agree that irreparable damage would occur if any provision of this Agreement were
not performed in accordance with the terms hereof and, accordingly, that the parties shall be entitled to seek an injunction or
injunctions to prevent breaches of this Agreement or to enforce specifically the performance of the terms and provisions hereof
(including the parties’ obligation to consummate the Integrated Mergers), in addition to any other remedy to which they are
entitled at law or in equity. Each of the parties hereby further waives (a) any defense in any action for specific performance
that a remedy at law would be adequate and (b) any requirement under any law to post security or a bond as a prerequisite to obtaining
equitable relief.
9.11 Severability. Whenever
possible, each provision or portion of any provision of this Agreement shall be interpreted in such manner as to be effective and
valid under applicable law, but if any provision or portion of any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability
shall not affect any other provision or portion of any provision in such jurisdiction, and this Agreement shall be reformed, construed
and enforced in such jurisdiction such that the invalid, illegal or unenforceable provision or portion thereof shall be interpreted
to be only so broad as is enforceable.
9.12 Delivery
by Facsimile or Electronic Transmission. This Agreement and any signed agreement or instrument entered into in connection
with this Agreement, and any amendments or waivers hereto or thereto, to the extent signed and delivered by means of a facsimile
machine or by e-mail delivery of a “.pdf” format data file, shall be treated in all manner and respects as an original
agreement or instrument and shall be considered to have the same binding legal effect as if it were the original signed version
thereof delivered in person. No party hereto or to any such agreement or instrument shall raise the use of a facsimile
machine or e-mail delivery of a “.pdf” format data file to deliver a signature to this Agreement or any amendment hereto
or the fact that any signature or agreement or instrument was transmitted or communicated through the use of a facsimile machine
or e-mail delivery of a “.pdf” format data file as a defense to the formation of a contract and each party hereto forever
waives any such defense.
[Signature Page Follows]
IN WITNESS WHEREOF, Parent, Merger Sub
and the Company have caused this Agreement to be executed by their respective officers thereunto duly authorized as of the date
first above written.
|
OCEANFIRST FINANCIAL CORP. |
|
|
|
|
|
By: |
/s/ Christopher D. Maher |
|
Name: |
Christopher D. Maher |
|
Title: |
President and Chief Executive Officer |
|
|
|
|
|
JUSTICE MERGER SUB CORP. |
|
|
|
|
|
By: |
/s/ Christopher D. Maher |
|
|
Name: |
Christopher D. Maher |
|
|
Title: |
President |
|
|
|
|
|
CAPE BANCORP, INC. |
|
|
|
|
|
By: |
/s/ Michael D. Devlin |
|
Name: |
Michael D. Devlin |
|
Title: |
President and Chief Executive Officer |
[Signature Page to Agreement and Plan
of Merger]
Community Bancorp OF New Jersey (NASDAQ:CBNJ)
Historical Stock Chart
From Jul 2024 to Aug 2024
Community Bancorp OF New Jersey (NASDAQ:CBNJ)
Historical Stock Chart
From Aug 2023 to Aug 2024