AGREEMENT AND PLAN OF MERGER
by and between
REPUBLIC BANCORP INC.
and
CITIZENS BANKING CORPORATION
---------------------
DATED AS OF JUNE 26, 2006
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TABLE OF CONTENTS
ARTICLE I
THE MERGER
1.1 The Merger...........................................................
1.2 Effective Time.......................................................
1.3 Effects of the Merger................................................
1.4 Conversion of Republic Common Stock..................................
1.5 Proration............................................................
1.6 Stock Options and Other Stock-Based Awards...........................
1.7 Certificate of Incorporation of Citizens.............................
1.8 Bylaws of Citizens...................................................
1.9 Tax Consequences.....................................................
ARTICLE II
DELIVERY OF MERGER CONSIDERATION
2.1 Election Procedures..................................................
2.2 Deposit of Merger Consideration......................................
2.3 Delivery of Merger Consideration.....................................
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF REPUBLIC
3.1 Corporate Organization...............................................
3.2 Capitalization.......................................................
3.3 Authority; No Violation..............................................
3.4 Consents and Approvals...............................................
3.5 Reports; Regulatory Matters..........................................
3.6 Financial Statements.................................................
3.7 Broker's Fees........................................................
3.8 Absence of Certain Changes or Events.................................
3.9 Legal Proceedings....................................................
3.10 Taxes and Tax Returns................................................
3.11 Employee Matters.....................................................
3.12 Compliance with Applicable Law.......................................
3.13 Certain Contracts....................................................
3.14 Risk Management Instruments..........................................
3.15 Investment Securities................................................
3.16 Loan Portfolio.......................................................
3.17 Property.............................................................
3.18 Intellectual Property................................................
3.19 Environmental Liability..............................................
3.20 State Takeover Laws..................................................
3.21 Reorganization; Approvals............................................
3.22 Opinions.............................................................
3.23 Republic Information.................................................
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF CITIZENS
4.1 Corporate Organization...............................................
4.2 Capitalization.......................................................
4.3 Authority; No Violation..............................................
4.4 Consents and Approvals...............................................
4.5 Reports; Regulatory Matters..........................................
4.6 Financial Statements.................................................
4.7 Broker's Fees........................................................
4.8 Absence of Certain Changes or Events.................................
4.9 Legal Proceedings....................................................
4.10 Taxes and Tax Returns................................................
4.11 Compliance with Applicable Law.......................................
4.12 Intellectual Property................................................
4.13 Risk Management Instruments..........................................
4.14 Investment Securities................................................
4.15 Property.............................................................
4.16 Environmental Liability..............................................
4.17 Reorganization; Approvals............................................
4.18 Opinion..............................................................
4.19 Citizens Information.................................................
4.20 Employee Matters.....................................................
4.21 Loan Portfolio.......................................................
4.22 Certain Contracts....................................................
ARTICLE V
COVENANTS RELATING TO CONDUCT OF BUSINESS
5.1 Conduct of Businesses Prior to the Effective Time....................
5.2 Republic Forbearances................................................
5.3 Citizens Forbearances................................................
ARTICLE VI
ADDITIONAL AGREEMENTS
6.1 Regulatory Matters...................................................
6.2 Access to Information................................................
6.3 Shareholder Approvals................................................
6.4 Affiliates...........................................................
6.5 Nasdaq Listing.......................................................
6.6 Employee Matters.....................................................
6.7 Indemnification; Directors' and Officers' Insurance..................
6.8 Additional Agreements................................................
6.9 Advice of Changes....................................................
6.10 Exemption from Liability Under Section 16(b).........................
6.11 No Solicitation by Republic..........................................
6.12 No Solicitation by Citizens..........................................
6.13 Coordination of Dividends............................................
6.14 Certain Tax Matters..................................................
6.15 Certain Post-Closing Matters.........................................
ARTICLE VII
CONDITIONS PRECEDENT
7.1 Conditions to Each Party's Obligation to Effect the Merger...........
7.2 Conditions to Obligations of Citizens................................
7.3 Conditions to Obligations of Republic................................
ARTICLE VIII
TERMINATION AND AMENDMENT
8.1 Termination..........................................................
8.2 Effect of Termination................................................
8.3 Fees and Expenses; Termination Fees..................................
8.4 Amendment............................................................
8.5 Extension; Waiver....................................................
ARTICLE IX
GENERAL PROVISIONS
9.1 Closing..............................................................
9.2 Nonsurvival of Representations, Warranties and Agreements............
9.3 Notices..............................................................
9.4 Interpretation.......................................................
9.5 Counterparts.........................................................
9.6 Entire Agreement.....................................................
9.7 Governing Law; Jurisdiction..........................................
9.8 Publicity............................................................
9.9 Assignment; Third Party Beneficiaries................................
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INDEX OF DEFINED TERMS
Section
Adjusted Option................................................... 1.6(a)
Agency (Agencies)................................................. 3.16(d)
Agreement......................................................... Preamble
Alternative Proposal.............................................. 6.11(a)
Alternative Transaction........................................... 6.11(a)
Average Closing Price............................................. 8.1(h)
BHC Act........................................................... 3.1(b)
Business Day...................................................... 8.1(h)
Cash Component.................................................... 1.4(d)
Cash Consideration................................................ 1.4(d)(i)
Cash Conversion Number............................................ 1.5(a)
Cash Election..................................................... 1.4(d)(i)
Cash Election Number.............................................. 1.5(b)(i)
Cash Election Shares.............................................. 1.4(d)(i)
Certificate....................................................... 1.4(e)
Certificate of Merger............................................. 1.2
Citizens.......................................................... Preamble
Citizens Alternative Proposal..................................... 6.12(a)
Citizens Alternative Transaction.................................. 6.11(a)
Citizens Articles................................................. 4.1(b)
Citizens Benefit Plans............................................ 4.20(a)
Citizens By-laws.................................................. 4.1(b)
Citizens Capitalization Date...................................... 4.2(a)
Citizens Closing Price............................................ 1.4(d)
Citizens Common Stock............................................. 1.4(a)
Citizens Continuing Director...................................... 6.15(a)(i)
Citizens Contracts................................................ 4.22(a)
Citizens Disclosure Schedule...................................... Art. IV
Citizens Leased Properties........................................ 4.15
Citizens Owned Properties......................................... 4.15
Citizens Pool..................................................... 4.21(f)
Citizens Preferred Stock.......................................... 4.2(a)
Citizens Ratio.................................................... 8.1(h)(ii)
Citizens Real Property............................................ 4.15
Citizens Regulatory Agreement..................................... 4.5(b)
Citizens Requisite Regulatory Approvals........................... 7.2(d)
Citizens Restricted Share Right................................... 1.6(b)
Citizens Rights Agreement......................................... 4.2(a)
Citizens SEC Reports.............................................. 4.5(c)
Citizens Starting Price........................................... 8.1(h)
Citizens Stock Plans.............................................. 4.2(a)
Citizens Shareholders' Meeting.................................... 6.3
Citizens Subsidiary............................................... 3.1(c)
Citizens Warrant.................................................. 1.6(c)
Claim............................................................. 6.7(a)
Closing........................................................... 9.1
Closing Date...................................................... 9.1
Code.............................................................. Recitals
Confidentiality Agreement......................................... 6.2(b)
Covered Employees................................................. 6.6(a)
Criticized Assets................................................. 4.21(a)
Derivative Transactions........................................... 3.14(a)
Determination Date................................................ 8.1(h)
Director Article.................................................. 6.3(a)
Director Bylaw.................................................... 6.15(a)(i)
DPC Common Shares................................................. 1.4(b)
Effective Time.................................................... 1.2
Election.......................................................... 2.1(a)
Election Deadline................................................. 2.1(d)
ERISA............................................................. 3.11(a)
Exchange Act...................................................... 3.5(c)
Exchange Agent.................................................... 2.1(d)
Exchange Agent Agreement.......................................... 2.1(d)
Exchange Fund..................................................... 2.2
Exchange Ratio.................................................... 1.4(d)
FDIC.............................................................. 3.1(d)
Federal Reserve Board............................................. 3.4
Fill Option....................................................... 8.1(h)
Final Aggregate Consideration..................................... 8.1(h)
Final Index Price................................................. 8.1(h)
Final Price....................................................... 8.1(h)
Form of Election.................................................. 2.1(b)
Form S-4.......................................................... 3.4
GAAP.............................................................. 3.1(c)
Governmental Entity............................................... 3.4
Holder............................................................ 2.1
Indebtedness...................................................... 3.13(a)
Indemnified Parties............................................... 6.7(a)
Index Group....................................................... 8.1(h)
Index Ratio....................................................... 8.1(h)(ii)
Initial Aggregate Consideration................................... 8.1(h)
Initial Index Price............................................... 8.1(h)
Injunction........................................................ 7.1(d)
Insurance Amount.................................................. 6.7(c)
Intellectual Property............................................. 3.18
IRS............................................................... 3.10(a)
Joint Proxy Statement............................................. 3.4
Letter of Transmittal............................................. 2.3(a)
Liens............................................................. 3.2(b)
Loans............................................................. 3.16(a)
Material Adverse Change........................................... 3.1(a)
Material Adverse Effect........................................... 3.1(a)
Materially Burdensome Regulatory Condition........................ 6.1(b)
MBCA.............................................................. 1.1(a)
Merger............................................................ Recitals
Merger Consideration.............................................. 1.4(d)
Nasdaq............................................................ 1.4(d)
Non-Election Shares............................................... 1.4(d)(iii)
Other Regulatory Approvals........................................ 3.4
Per Share Amount.................................................. 1.4(d)
Permitted Encumbrances............................................ 3.17
Policies, Practices and Procedures................................ 3.15(b)
Problem Loans..................................................... 3.16(a)
Republic.......................................................... Preamble
Republic Appointee................................................ 6.15(a)(i)
Republic Alternative Proposal..................................... 6.11(a)
Republic Alternative Transaction.................................. 6.11(a)
Republic Articles................................................. 3.1(b)
Republic Benefit Plans............................................ 3.11(a)
Republic By-laws.................................................. 3.1(b)
Republic Capitalization Date...................................... 3.2(a)
Republic Common Stock............................................. 1.4(b)
Republic Continuing Director...................................... Exhibit B
Republic Contract................................................. 3.13(a)
Republic Deferred Shares.......................................... 1.6(c)
Republic Disclosure Schedule...................................... Art. III
Republic Leased Properties........................................ 3.17
Republic Options.................................................. 1.6(a)
Republic Owned Properties......................................... 3.17
Republic Pool..................................................... 3.16(f)
Republic Preferred Stock.......................................... 3.2(a)
Republic Real Property............................................ 3.17
Republic Regulatory Agreement..................................... 3.5(b)
Republic Requisite Regulatory Approvals........................... 7.3(d)
Republic Restricted Shares........................................ 1.6(b)
Republic SEC Reports.............................................. 3.5(c)
Republic Stock Plans.............................................. 1.6(a)
Republic Shareholders' Meeting.................................... 6.3
Republic Subsidiary............................................... 3.1(c)
Republic Warrants................................................. 1.6(c)
Regulatory Agencies............................................... 3.5(a)
Sarbanes-Oxley Act................................................ 3.5(c)
SEC............................................................... 3.4
Securities Act.................................................... 3.2(a)
Share Ratio....................................................... 1.4(d)
Shortfall Number.................................................. 1.5(b)(ii)
SRO............................................................... 3.5
Stock Consideration............................................... 1.4(d)(ii)
Stock Election.................................................... 1.4(d)(ii)
Stock Election Shares............................................. 1.4(d)(ii)
Stock Issuance.................................................... 4.3(a)
Subsidiary........................................................ 3.1(c)
Surviving Corporation............................................. Recitals
Takeover Statutes................................................. 3.20
Tax Return........................................................ 3.10(c)
Tax(es)........................................................... 3.10(b)
Termination Fee................................................... 8.3(b)
Trust Account Common Shares....................................... 1.4(b)
Voting Debt....................................................... 3.2(a)
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AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated as of June 26, 2006 (this
"Agreement"), by and between Republic Bancorp Inc., a Michigan corporation
("Republic"), and Citizens Banking Corporation, a Michigan corporation
("Citizens").
W I T N E S S E T H:
WHEREAS, the Boards of Directors of Republic and Citizens 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 in this Agreement in which Republic will, on the terms and subject
to the conditions set forth in this Agreement, merge with and into Citizens (the
"Merger"), so that Citizens is the surviving corporation in the Merger
(sometimes referred to in such capacity as the "Surviving Corporation"); and
WHEREAS, for federal income Tax purposes, it is intended that the
Merger shall qualify as a reorganization under the provisions 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 and 361 of the Code; and
WHEREAS, the parties desire to make certain representations,
warranties and agreements in connection with the Merger and also to prescribe
certain conditions to the Merger.
NOW, THEREFORE, in consideration of the mutual covenants,
representations, warranties and agreements contained in this Agreement, and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, and intending to be legally bound hereby, the parties agree
as follows:
ARTICLE I
THE MERGER
1.1 The Merger. Subject to the terms and conditions of this
Agreement, in accordance with the Michigan Business Corporation Act (the
"MBCA"), at the Effective Time, Republic shall merge with and into Citizens.
Citizens shall be the Surviving Corporation in the Merger, and shall continue
its corporate existence under the laws of the State of Michigan. As of the
Effective Time, the separate corporate existence of Republic shall cease.
1.2 Effective Time. The Merger shall become effective as set forth
in the certificate of merger (the "Certificate of Merger") that shall be filed
with the Secretary of State of the State of Michigan on the Closing Date. The
term "Effective Time" shall be the date and time when the Merger becomes
effective as set forth in the Certificate of Merger.
1.3 Effects of the Merger. At and after the Effective Time, the
Merger shall have the effects set forth in Section 724 of the MBCA.
1.4 Conversion of Republic Common Stock. At the Effective Time, by
virtue of the Merger and without any action on the part of Citizens, Republic or
the holder of any of the following securities:
(a) Each share of common stock, without par value, of Citizens
(including the related preferred stock purchase rights, the "Citizens
Common Stock") issued and outstanding immediately prior to the Effective
Time shall remain issued and outstanding and shall not be affected by the
Merger.
(b) All shares of common stock, par value $5.00 per share, of
Republic issued and outstanding immediately prior to the Effective Time
(the "Republic Common Stock") that are owned by Republic or Citizens
(other than shares of Republic Common Stock held in trust accounts,