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1 Matthew S. Kennedy – CSB No. 125620
MATTHEW S. KENNEDY, A Professional Law Corporation
2 Post Office Box 1031
San Luis Obispo, California 93406-1031
3 (805) 544-5002 / (805) 544-5003
E-Mail: msk@KennedyLawRealty.com
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Attorneys for Defendant MECHANICS BANK,
5 a California corporation, successor by merger
to Rabobank, N.A.
6
7 SUPERIOR COURT OF THE STATE OF CALIFORNIA
8 COUNTY OF MONTEREY
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11 ROBERT T. ELLIOTT, CASE NO. 21 CV 003944
Assigned to: Hon. Carrie M. Panetta
12 Plaintiff,
13 vs.
STIPULATION AND ORDER TO SET
14 MECHANICS BANK, a California ASIDE DEFAULT
corporation, as the Successor-in-Interest to
15 Rabobank, N.A., a California corporation;
RABOBANK, N.A., a California
16 corporation; and DOES 1 - 40, inclusive, Complaint filed: December 20, 2021
CMC: April 19, 2022
17 Defendants. Trial Date: None Assigned
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19 Plaintiff, ROBERT T. ELLIOTT, by and through his attorney(s), Nina M. Patane, Esq. |
20 Andrea C. Avila, Esq., Patane, Gumberg, Avila LLP, and Defendant, MECHANICS BANK, a
21 California corporation, as the Successor-in Interest to Rabobank, N.A., a California corporation; and
22 RABOBANK, N.A., a California corporation (erroneously named as set forth below) (collectively
23 “Defendant”), by and through its attorney, Matthew S. Kennedy, Esq., Matthew S. Kennedy, A
24 Professional Law Corporation, hereby stipulate that the Default entered against the Defendant on or
25 about, March 25, 2022, shall be set aside in its entirety, based upon agreement of the parties hereto
26 following termination of early attempts by the parties to settle this matter.
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STIPULATION AND ORDER TO SET ASIDE JUDGMENT
1 It is hereby further stipulated that the Complaint erroneously names the Defendant as
2 “Defendant, MECHANICS BANK, a California corporation, as the Successor-in Interest to
3 Rabobank, N.A., a California corporation; and RABOBANK, N.A., a California corporation”.
4 The parties hereby further stipulate that:
5 A. Defendant MECHANICS BANK is a California corporation.
6 B. Defendant RABOBANK, N.A., a California corporation (as named in the Complaint),
7 was a bank organized under the federal National Bank Act, and by that definition, was
8 not a California corporation.
9 C. On or about August 29, 2019, that certain “Agreement and Plan of Merger of Rabobank,
10 NA and Mechanics Bank” (“Merger Agreement” and sometimes “Bank Merger”),
11 approved by the California Commissioner of Business Oversight, and filed with the
12 California Secretary of State, became effective August 31, 2019 [a true and correct copy
13 of which is attached hereto as Exhibit A; see also for confirmation FDIC website
14 https://banks.data.fdic.gov/bankfind-suite/bankfind 1].
15 D. The Merger Agreement at Articles I, II and V, provides in part, as follows:
16 ARTICLE I
17 Constituent Entities
MB and RNA shall be the constituent entities with respect to the Bank Merger.
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ARTICLE II
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Bank Merger
20 2.1 Bank Merger. Subject to the terms and conditions of this Agreement, effective as
of the Effective Time (as defined below), RNA shall be merged with and into MB in
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accordance with 12 U.S.C. § 1828(c) and Section 4880 et seq of the California Financial
22 Code ("CFC"), and with the effect provided in Section 4889 of the CFC and Section
1107 of the California General Corporation Law. At the Effective Time (as defined
23 below), the separate existence of NA shall cease, and MB, as the surviving institution
(sometimes hereinafter referred to as the "Surviving Institution"), shall continue
24 unaffected and unimpaired by the Bank Merger. The name of the Surviving Institution.
25 shall be "Mechanics Bank".
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Search Rabobank, N.A. where it will confirm that Rabobank, N.A. “merged and became part of Mechanics Bank
on August 31, 2019,” and will also contain a link to Mechanics Bank, as “succeeding institution.” Click on that link,
28 and select “history” for either Rabobank, N.A. or Mechanics Bank, and it will confirm that Mechanics Bank
acquired Rabobank, N.A. on August 31, 2019.
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STIPULATION AND ORDER TO SET ASIDE JUDGMENT
1 ARTICLEV
2 Effect of Bank Merger
The effect of the Bank Merger shall be as prescribed by law, including Section 4889
3 of the CFC and Section 1107 of the California General Corporation Law. Without
4 limiting the foregoing, from and after the Effective Time, (i) all rights, franchises and
interests of each of the constituent entities in and to every type of property (whether
5 real, personal, tangible or intangible) and choses in action shall be vested in the
Surviving Institution by virtue of the Bank Merger without any deed or other transfer;
6 (ii) the Surviving Institution, without any order or action on the part of any court or
otherwise, shall hold and enjoy all such rights and property, franchises and interests,
7 including appointments, designations and nominations, and in every other fiduciary
8 capacity, in the same manner and to the same extent as such rights, franchises and
interests were held or enjoyed by each of the constituent entities prior to the Effective.
9 Time; (iii) all liabilities of each of the constituent entities shall become the Surviving
Institution's liabilities; (iv) all debts, liabilities and contracts of each of the constituent
10 entities, matured or unmatured, whether accrued, absolute, contingent or otherwise, and
whether or not reflected or reserved against on balance sheets, books of accounts, or
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records of each of the constituent entities, shall be those of the Surviving Institution and
12 shall not be released or impaired by the Bank Merger; (v) all rights of creditors and other
obligees and all liens on property of each of the constituent entities shall be preserved
13 unimpaired; and (vi) the Surviving Institution shall be responsible for all obligations of
each of the constituent entities and each claim existing and each action or proceeding
14 pending by or against either of the constituent entities may be prosecuted as if the Bank
Merger had not taken place, and the Surviving Institution may be substituted in the place
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of such constituent entity.
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E. By operation of law, Defendant MECHANICS BANK, a California corporation, is the
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surviving entity as between Defendant MECHANICS BANK, a California corporation
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and Rabobank, N.A., the constituent entities with respect to the Bank Merger.
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F. By operation of law, Defendant MECHANICS BANK, a California corporation, is the
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sole and exclusive owner of that certain Judgment entered in favor of Rabobank, N.A. on
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July 8, 2008 in Monterey County Superior Court Case No. M82496, which is the subject
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of this action.
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G. By operation of law, Defendant MECHANICS BANK, a California corporation is the
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sole named defendant in this Action, and subject to any amendments in or to the
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pleadings in this action, that all further captions and references identifying Defendant
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MECHANICS BANK, a California corporation and its relationship to Rabobank, N.A.,
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shall be as follows: “Defendant MECHANICS BANK, a California corporation,
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successor by merger to Rabobank, N.A.”.
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STIPULATION AND ORDER TO SET ASIDE JUDGMENT
1 It is hereby further stipulated that the Defendant MECHANICS BANK, a California
2 corporation, successor by merger to Rabobank, N.A., shall file its Answer on the next court day upon
3 service of the Order setting aside the default.
4 Attached as Exhibit B is the Answer to be filed by Defendant MECHANICS BANK, a
5 California corporation, successor by merger to Rabobank, N.A.
6 DATED [Effective]: May 2, 2022. MATTHEW S. KENNEDY, A
PROFESSIONAL LAW CORPORATION
7 Digitally signed by Matthew Scott
Kennedy, Esq.
Date: 2022.05.02 15:14:30 -07'00'
8
/s/ Matthew S. Kennedy, Esq.
9 Matthew S. Kennedy, Esq.
Attorney for Defendant, MECHANICS BANK,
10 a California corporation, successor by merger to
Rabobank, N.A.
11
Patane, Gumberg, Avila LLP
12 DATED [Effective]: May 2, 2022.
13
14 Andrea C. Avila, Esq.
Attorney for Plaintiff, ROBERT T. ELLIOTT
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STIPULATION AND ORDER TO SET ASIDE JUDGMENT
1 ORDER
2 Good cause appearing, the parties having made stipulation, the Default of
3 MECHANICS BANK, a California corporation, successor by merger to Rabobank, N.A. (and|or as
4 otherwise identified in the subject Complaint and this Stipulation) entered on March 25, 2022, is set
5 aside. Defendant MECHANICS BANK, a California corporation, successor by merger to Rabobank,
6 N.A., shall file its Answer on the next court day upon service of the Order setting aside the default.
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8 DATED: , 2022
JUDGE OF THE SUPERIOR COURT
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STIPULATION AND ORDER TO SET ASIDE JUDGMENT
EXHIBIT A
. , APPROVED 408323~8 STRICTLY CONFIDENTIAL
August28,2019
MANUEL P. ALVAREZ
Commissioner of Business oversight ooE,224 6t1,tv· FILED~
By v~f-u.!lf---- AGREEMENTANDPLANOFMERGER
OF
.
Secretary of State
Stat~ or CalifomiaOf
----
JENNIFER L.W. RUMBERGER
Senior Counsel RABOBANK, N.A. ( ~AUG 29 2019t:J--
AND MECHANICS BANK
This Agreement and Plan o Merger (this " eement"), dated as of June 17,
2019, is adopted and made by and between Mechanics B a California banking corporation,
having its main office at 1111 Civic Drive, Walnut Creek, CA 94596 ("MB,,), and Rabobank,
N.A. a national banking association, having its main office at 915 Highland Pointe Drive,
Roseville, CA 95678 ("RNA"). .
WITNESSETH:
WHEREAS, MB is a California banking corporation;
WHEREAS, RNA is a national banking association, 99.99% of the issued and
outstanding. capital stock of which is owned as of the date hereof, and ·all of the issued and
outstanding capital stock of which will be owned as of immediately prior to the consummation of
the Acquisition (as defined below), directly by Pistachio NewCo Inc., a Delaware corporation (the
"Holdco,,);
WHEREAS, Holdco, as of the date hereof,. is a wholly owned subsidiary of
Rabobank International Holding B.V., a,Besloten Vennootschap Met Beperkte Aansprakelijkheid
organized under the laws ofthe Kingdomof~e Netherlands (the "Seller"); ·
(
WHEREAS, MB and the Seller have ent~red into a Stock Purchase Agreement,
dated as o~ March 15, 2019 (the "Stock Purchase Agre~ment"), providing for the purchase (the
"Acquisition") by MB from the.Seller of 100% of the issued :and outstanding shares of common
stock of Holdco, and MB and Holdco have entel'Cd into an Agreement of Merger, dated as of the
date hereof (the "Holdco Merger Agreement"), providing that following the closing of the
Acquisition, Holdco will merge (the "Holdco Merger~') with and into MB, with MB as the
surviving corporation in the Holdco Merger and continuing its corporate existence under the laws
of the State of California;
WHEREAS, contingent upon the Acquisition and the Holdco Merger and
immediately following the effective time ·of the Holdco Merger, the parties to this Agreement
intend to effect the merger of RNA with and into MB, with MB as the surviving institution (the
"Bank MergerH), on the tenns and subject to the conditions contained in this Agreement; and
WHEREAS, the respective boards of directors of MB and RNA have each adopted
a resolution approving this Agreement &:id authorizing the execution hereof.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth .and other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, and subject to the terms and conditions of the Stock Purchase
Agreement, the parties hereto agree as follows:
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A0832348
ARTICLE I
.Constituent Entities
MB and RNA shall be the constjtuent entities with respect to th~ Bank Merger.
ARTICLE II
· Bank Merger
2.1 Bank Merger. . Subject to the tenns and conditions of this Agreement, effective as
of the Effective Time (as defined below), RNA shall be merged with and into MB in accordance
with 12 U.S.C. § 1828(c) and Section 4880 et~- of the California ·Financial Code ("CFC"), and
with the effect provided in Section 4889 of the CFC and Section 1107 of the California General
Corporation Law. At the Effective Time (as defined below), the separate existence of~A shall
cease, and MB, as the surviving institution (sometimes hereinafter referred to as the "Surviving
Institution"), shall continue unaffected and unimpaired by the Bank Merger. The name of the
Surviving· Institution .shall be "Mechanics Bank".
2.2 Effective Time. The Banlc Merger shall become effective immediately following
the time when all of the conditions precedent to the consummation of the Bank Merger specified
in this Agreement shall have been satisfied or duly waived by the party entitled to satisfaction
thereof, this Agreement shall have been filed with the California Secretary of State, and the
Surviving Institution shall have filed with the commissioner of the California Department of
Business Oversight a copy of this Agreement certified by the California Secretary of State in
accordance with Section 4887(b) of the CFC (such date and time being herein referred to as the
"Effective Time").
ARTICLEID
Charter, Bylaws, Etc.
3 .1 Articles of Incomoration. At the Effective Time, the articles of incorporation of
MB in effect immediately prior to the Effective Time shall continue . to ·be the articles of
incorporation of the Surviving Institution until thereafter amended in accordance. with applicable
law. The articles of incorporation of MB as shall be in effect .immediately prior to the Effective
Time are set forth as Exhibit A hereto and incorporated herein by reference.
3.2 Bylaws. At the Effective Time, the bylaws of MB in effect immediately prior to
the Effective Time shall continue to be the bylaws of the Surviving Institution until thereafter
amended in accordance with applicable .law.
3.3 Directors. At the Effective Time, the board of directors of the Surviving Institution
will consist of the djrectors of MB immediately prior to the Effective Time.
3.4 Home Offices. The home office and branch offices of MB existing immediately
prior to the Effective Time shall continue to be the home office and branch offices, respectively,
of the Surviving Institution. Exhibit B sets forth RNA's home office and branch offices as of the
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,. ll0832348
.•
date of this Agreement. Immediately following the Effective Time, the Surviving Institution shall
continue to operate such home office and branch offices of RNA as set forth in Exhibit B as branch
offices of the Surviving Institution at the address of each such office or branch listed therein.
Notwithstanding anything to the contrary in the foregoing, branch offices of RNA and MB as set
forth in Exhibit C will be closed or consolidated as of the Effective Time or following the Banlc
Merger in compliance with applicable regulatory requirements and ·MB's branch closing and
consolidation policy. ·
ARTICLE IV
Capital Stock
4.1 Effect on RNA Capital Stock. By virtue of the Bank Merger and without any action
on the part of the holder of any capital stock of RNA, at the Effective Time, all shares of RNA
capital stock issued and outstanding shall be automatically cancelled and retired and shall cease to
exist, and no cash, new shares of common stock, or other property shall be delivered in exchange
therefor.
4.2 Effect on MB Capital Stock. Each share of MB capital stock issued and outstanding
immediately prior to the Effective Time shall remain issued and outstanding and unaffected by the
Ba~Merger.
ARTICLEV
Effect of Bank Merger
The .effect of the Bank Merger shall be as prescribed by law, including Section 4889
of the CFC and Section 1107 of the California General Corporation Law. Without limiting the
foregoing, from and after the Effective Time, (i) all rights, franchises and interests of each of the
constituent entities in and to every type of property (whether real, personal, tangible or intangible)
and choses in action shall be vested in the Surviving Institution by virtue of the Bank Merger
. without any deed or other transfer; (ii) the Surviving Iitstitution, without any order or action on the
part of any court or otherwise, shall hold and enjoy all such rights and property, franchises· and
interests, including appointments, designations and nominations, an~ in .every other fiduciary
capacity, in the same manner and to the same extent as such rights, franchises and interests were
held or enjoyed by each of the constituent entities prior to the Effective.Time; (iii) all liabilities of
each of the constituent entities shall become the Surviving Institution's liabilities; (iv) all debts,
liabilities and contracts of each of the constituent entities, matured or unmatured, whether accrued,
absolute, contingent or otherwise, and whether or not reflected or reserved against on balance
sheets, books of accounts, or records of each of the constituent entities, shall be those of the
Surviving Institution and shall not be released or impaired by the Bank Merger; (v) ail rights of
creditors and other obligees and all liens on property of each of the constituent entities shall be
preserved unimpaired; and (vi) the Surviving Institution shall be responsible for all obligations of
each of the constituent entities and each claim existing and each action or proceeding pending by
or against either of the constituent entities may be prosecuted as if the Bank Merger had not taken
place, and the Surviving Institution may be substituted in the place of such constituent entity.
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A-.0..83231+8
ARTICLE VI
Conditions to the Bank Me~er
The respective obligations ·of each of MB and RNA to consummate the Bank
Merger are subject to the fulfillment, or written waiver by the party entitled to satisfaction ·thereof
prior to the Effective Time, of each of the following conditions:
(a) This Agreement shall have been approved and adopted by the written
consent of the shareholders of RNA in lieu of a meeting of shareholders;
(b) All approvals and authorizations of, filings and registrations with, and
notifications to, all governmental authorities required for the consummation of the Bank
Merger shall have been obtained or made and shall be in full force and effect and all waiting
periods required by applicable law shall have expired or been tenninated;
(c) No relevant governmental authority shall have enacted, issued,
promulgated, enforced or entered any statute, rule, regulation, judgment, decree, injunction
or other order (whether temporary, preliminary or permanent) which is in effect and
prohibits consummation of the transactions contemplated by this Agreement; and
(d) The Acquisition and .the Holdco Merger shall have been consummated
pursuant to the Stock Purchase Agreement and the Holdco Merger Agreement,
respectively.
ARTICLE VII
Further Documents
If at any time the Surviving Institution shall consider or be advised that any further ,
deeds, assignments, conveyances or assurances in law are necessary or.desirable to vest, perfect
or confirm of record in the Surviving Institution the title to any property or rights of the constituent
entities, or otherwise to carry out the provisions hereof, the persons wJto were the proper officers
and directors of the constituent entities immediately prior to the Effective Time (or their successors
. in office) shall execute and deliver any and all proper deeds, assignments, conveyances and
assurances in law, and do all things necessary or desirable, to vest, perfect or confirm title to such
property or rights in the Surviving Institution and otherwise to carry out the provisions hereof.
ARTICLEVIll
. Termination .
In the event that the Stock Purchase Agreement is terminated pursuant to the terms
thereof, this Agreement shall be terminated and the Bank Merger provided for herein shall be
abandoned automatically and without any further act or deed by the parties hereto. This Agreement
also may be terminated at any time prior to the Effective Time by a written instrument executed
by each of the parties hereto.
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A0832348
AATICLEIX
Miscellaneous
9.1 Representations and Warranties. Each of the parties hereto represents and warrants
that this Agreement has been duly authorized, executed and delivered by such parcy and constitutes
the legal, valid and binding obligation of such party, enforceable against it in accordance with the
terms hereof, except as such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer and similar laws of general applicability relating
to or affecting creditors' rights or by general equity principles.
9.2 Entire Agreement. This Agreement (including the documents and instruments
referred to. herein and attached hereto), together with the Stock Purchase Agreement and the
Holdco Merger Agreement, constitutes the entire agreement among the parties with respect to the
subject matter hereof and supersedes all prior agreements and understandings, both written and
oral, among the parties with respect to the subject matter hereof.
9.3 Counter.parts. This Agreement may be executed in counterparts (including by
facsimile or other electronic means), each of which shall be deemed to be an original, but all of
which shall constitute one and the same agreement.
9.4 Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of California, without regard to choice of law principles.
9.5 Assignment. This Agreement shall not be assignable by either party.
9.6 Norisurvival of Agreements. None of the agreements in this Agreement or in any
instrument delivered pursuant to this Agreement shall survive the Effective Time or termination
of this Agreement pursuant to Article VIII. ·
9.7 Amendment. This Agreement may not be amended, except by an instrument in
writing signed on behalf ofeach of the parties hereto. ·
9.8 Notices. All notices or other communications hereunder to a party shall be deemed
to have been duly given and made if in writing and if served by personal delivery, if delivered by
registered or certified mail (return receipt requested), or by a national courier service, or by email
so long as such email states it is a notice delivered pursuant to this section and is confirmed with
a telephone call to·the recipient: ·
IftoRNAto:
Rabobank, N .A.
915 Highland Pointe, Suite 350
Roseville, California · 95678 ·
Attention: Lynette Hotchkiss
Telephone: (916) 878-4689
Email: Lynette.Hotchkiss@rabobank.com
5
'10832348
With a copy (which shall not constitute notice) to:
Cooperatieve Rabobank U.A.
Croeselaan 18
3521 CB Utrecht
Attention: Jan Schuchard, Head Legal
Telephone: +31 30 2163303_
Email: J.Schuchard@rabobank.nl
and
Sullivan & Cromwell LLP
125 Broad Street·
New York, New York 10004
Attention: Donald J. Towney
Stephen M. Salley
Telephone: (212) ~58-4000 .
Email: toumeyd@sullcrom.com
salleys@sullcrom.com
Ifto MB to:
Mechanics Bank
1111 Civic Drive
Walnut Creek, California 94596
Attention: Glenn Shrader
Email: glenn_shrader@mechanicsbank.com
With a copy (which shall not con~titute notice)to:
Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, New York 10019
Attention: David E. Shapiro, Esq.
l acob A. Kling, Esq. ·
Fax: (212) 403-2000
Email: DEShapiro@wlrk.com
JAK1ing@wlrk.com
[Signature pages follow]
4083231+·8
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed on their
behalf by their respective officers thereunto duly authotized as of the day and year first written
above.
SURVIVING CORPORATION MECHANICSBANK
By:
~~---
~~
N~W. DeCero ·
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Title: President and Chief Executive Officer ·
By:Na~~
Title: · Secretary
DISAPPEARIN_G CORPORATION RABOB~, N.A.
By:
Name: Mark Borrecco
Title: Chief Executive Officer
By:
Name: Lynette Hotphkiss
Title: General CQtmSel and Secretary
J
{Signature Page ·to the Agreement and Plan ofMerger]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed on their
behalf by their respective officers thereunto duly authorized as of the day and year first written
above.
SURVIVING CORPORATION MECHANICS BANK
By:
Name: John W. DeCero
Title: President and Chief Executive Officer
By:
Name: Laura Jacob
Title: Secretary
DISAPPEARING.CORPORATION RABOBANK, N.A.
By: .. .' . . . . .. .
· ~
· ~Chief:omcer
[Signature Page to the Agreement and Plan ofMerger] .
A0832348
EXHIBIT A
ARTICLES OF INCORPORATION
RESTATED ARTICLES OF INCORPORATION
OF
IvlECHANICS BANK
ARTICLE I
The name of this corporation shall be Mechanics Bank (the "Corporation").
ARTICLE II
The purpose of the Corporation is to engage in commercial banking business and trust business
and any other lawful activities that are not, by applicable laws or regulations, prohibited to a
commercial bank authorized to engage in trust business.
ARTICLEID
1. CAPITALIZATION. The amount of capital stock that the Corporation is
authorized to issue is five hundred thousand (500,000) shares having a total p~
value of fifteen million dollars ($15,000,000), consisting ofthree hundred thousand
(300,000) shares of Common Stock of the par value of fifty dollars ($50) per share
("Common Stock") arid.two hundred thousand (200,000) shares of Preferred Stock
of no par value per share ("Preferred Stock"). The shares of Common Stock shall
be divided into two series, two hundred eighty thousand (280,000) shares of which
shall be designated ,svoting Common Stock," and twenty thousand (20,000) shares
of which shall be designated ''Non-Voting Common Stock." Except as expressly
provided herein, the rights, preferences and privileges of the Voting Common Stock
and Non-Voting Common Stock shall be in all respects and for all purposes and in
a.II circumstances absolutely and completely identical; provided, that if the
Corporation shall in any manner split, subdivide or combine the outstanding shares
of Voting Common Stock or Non-Voting Common Stock, the outstanding shares·
of the other series shall likewise be split,subdivided or combined in the same
manner proportionately and on the same basis per share; and provided,further, that
no dividend or distribution payable in shares of Voting Common Stock shall be
declared on the Non-Voting Common Stock and no dividend or distribution
payable in Non-Voting Common Stock shall be declared on the Voting Common
Stock, but instead, in the cas·e of a stock dividend or distribution, such dividend or
distribution shall be received in like stock (or in such other form as the Board of
Directors of the Corporation may determine in accordance with applicable law).
A083.2348
2: VOTING RIGHTS. Each share of Voting Common Stock shall be entitled
to one vote. Except as otherwise required by applicable law ot expressly provided
herein, the Non-Voting Common Stock shall have no voting power.
3. CONVERSION. The shares ofNon-Voting Common Stock will not be
convertible into shares of Voting. Common •Stock, except in ·connection with a
Covered Transfer. Upon completion·of a Covered Transfer, each share ofNon-
Voting Common Stock transferred in such Covered Transfer will automatically,
without action by any holder or transferee of such shares, ·be converted into one ( 1)
fully paid and nonassessable ·share of Voting Common .Stock (subject to
adjustment, if appropriate, in the event of any stock dividend, stock split,
combination or other recapitalization). "Covered Transfer'' means a transfer by a
holder of shares of Non-Voting Common Stock to a person that is not an affiliate
(as "affiliate" is defined in the Bank Holding Company Act of 1956, as amended)
of such holder (a) in a widely dispersed publjc offering (including assignment to a
single party (e.g., broker or investment banker) for the purposes of conducting a
widespread pubic distribution), (b) in a private sale in which no purchaser (or group
of associated purchasers) would acquire Voting Common Stock and/or Non-Voting
Common Stock in an amount that, after- the conversion of such Non-Voting
Common Stock into Voting Common Stock, is (or represents) two percent (2%) or
more of a class of the Corporation's voting securities or (c) where such transferee
would control a majority of the Corporation's voting securities notwithstanding
such transfer.
Preview
1 Matthew S. Kennedy – CSB No. 125620 MATTHEW S. KENNEDY, A Professional Law Corporation 2 Post Office Box 1031 San Luis Obispo, California 93406-1031 3 (805) 544-5002 / (805) 544-5003 E-Mail: msk@KennedyLawRealty.com 4 Attorneys for Defendant MECHANICS BANK, 5 a California corporation, successor by merger to Rabobank, N.A. 6 7 SUPERIOR COURT OF THE STATE OF CALIFORNIA 8 COUNTY OF MONTEREY 9 10 11 ROBERT T. ELLIOTT, CASE NO. 21 CV 003944 Assigned to: Hon. Carrie M. Panetta 12 Plaintiff, 13 vs. STIPULATION AND ORDER TO SET 14 MECHANICS BANK, a California ASIDE DEFAULT corporation, as the Successor-in-Interest to 15 Rabobank, N.A., a California corporation; RABOBANK, N.A., a California 16 corporation; and DOES 1 - 40, inclusive, Complaint filed: December 20, 2021 CMC: April 19, 2022 17 Defendants. Trial Date: None Assigned 18 19 Plaintiff, ROBERT T. ELLIOTT, by and through his attorney(s), Nina M. Patane, Esq. | 20 Andrea C. Avila, Esq., Patane, Gumberg, Avila LLP, and Defendant, MECHANICS BANK, a 21 California corporation, as the Successor-in Interest to Rabobank, N.A., a California corporation; and 22 RABOBANK, N.A., a California corporation (erroneously named as set forth below) (collectively 23 “Defendant”), by and through its attorney, Matthew S. Kennedy, Esq., Matthew S. Kennedy, A 24 Professional Law Corporation, hereby stipulate that the Default entered against the Defendant on or 25 about, March 25, 2022, shall be set aside in its entirety, based upon agreement of the parties hereto 26 following termination of early attempts by the parties to settle this matter. 27 28 -1- STIPULATION AND ORDER TO SET ASIDE JUDGMENT 1 It is hereby further stipulated that the Complaint erroneously names the Defendant as 2 “Defendant, MECHANICS BANK, a California corporation, as the Successor-in Interest to 3 Rabobank, N.A., a California corporation; and RABOBANK, N.A., a California corporation”. 4 The parties hereby further stipulate that: 5 A. Defendant MECHANICS BANK is a California corporation. 6 B. Defendant RABOBANK, N.A., a California corporation (as named in the Complaint), 7 was a bank organized under the federal National Bank Act, and by that definition, was 8 not a California corporation. 9 C. On or about August 29, 2019, that certain “Agreement and Plan of Merger of Rabobank, 10 NA and Mechanics Bank” (“Merger Agreement” and sometimes “Bank Merger”), 11 approved by the California Commissioner of Business Oversight, and filed with the 12 California Secretary of State, became effective August 31, 2019 [a true and correct copy 13 of which is attached hereto as Exhibit A; see also for confirmation FDIC website 14 https://banks.data.fdic.gov/bankfind-suite/bankfind 1]. 15 D. The Merger Agreement at Articles I, II and V, provides in part, as follows: 16 ARTICLE I 17 Constituent Entities MB and RNA shall be the constituent entities with respect to the Bank Merger. 18 ARTICLE II 19 Bank Merger 20 2.1 Bank Merger. Subject to the terms and conditions of this Agreement, effective as of the Effective Time (as defined below), RNA shall be merged with and into MB in 21 accordance with 12 U.S.C. § 1828(c) and Section 4880 et seq of the California Financial 22 Code ("CFC"), and with the effect provided in Section 4889 of the CFC and Section 1107 of the California General Corporation Law. At the Effective Time (as defined 23 below), the separate existence of NA shall cease, and MB, as the surviving institution (sometimes hereinafter referred to as the "Surviving Institution"), shall continue 24 unaffected and unimpaired by the Bank Merger. The name of the Surviving Institution. 25 shall be "Mechanics Bank". 26 27 1 Search Rabobank, N.A. where it will confirm that Rabobank, N.A. “merged and became part of Mechanics Bank on August 31, 2019,” and will also contain a link to Mechanics Bank, as “succeeding institution.” Click on that link, 28 and select “history” for either Rabobank, N.A. or Mechanics Bank, and it will confirm that Mechanics Bank acquired Rabobank, N.A. on August 31, 2019. -2- STIPULATION AND ORDER TO SET ASIDE JUDGMENT 1 ARTICLEV 2 Effect of Bank Merger The effect of the Bank Merger shall be as prescribed by law, including Section 4889 3 of the CFC and Section 1107 of the California General Corporation Law. Without 4 limiting the foregoing, from and after the Effective Time, (i) all rights, franchises and interests of each of the constituent entities in and to every type of property (whether 5 real, personal, tangible or intangible) and choses in action shall be vested in the Surviving Institution by virtue of the Bank Merger without any deed or other transfer; 6 (ii) the Surviving Institution, without any order or action on the part of any court or otherwise, shall hold and enjoy all such rights and property, franchises and interests, 7 including appointments, designations and nominations, and in every other fiduciary 8 capacity, in the same manner and to the same extent as such rights, franchises and interests were held or enjoyed by each of the constituent entities prior to the Effective. 9 Time; (iii) all liabilities of each of the constituent entities shall become the Surviving Institution's liabilities; (iv) all debts, liabilities and contracts of each of the constituent 10 entities, matured or unmatured, whether accrued, absolute, contingent or otherwise, and whether or not reflected or reserved against on balance sheets, books of accounts, or 11 records of each of the constituent entities, shall be those of the Surviving Institution and 12 shall not be released or impaired by the Bank Merger; (v) all rights of creditors and other obligees and all liens on property of each of the constituent entities shall be preserved 13 unimpaired; and (vi) the Surviving Institution shall be responsible for all obligations of each of the constituent entities and each claim existing and each action or proceeding 14 pending by or against either of the constituent entities may be prosecuted as if the Bank Merger had not taken place, and the Surviving Institution may be substituted in the place 15 of such constituent entity. 16 E. By operation of law, Defendant MECHANICS BANK, a California corporation, is the 17 surviving entity as between Defendant MECHANICS BANK, a California corporation 18 and Rabobank, N.A., the constituent entities with respect to the Bank Merger. 19 F. By operation of law, Defendant MECHANICS BANK, a California corporation, is the 20 sole and exclusive owner of that certain Judgment entered in favor of Rabobank, N.A. on 21 July 8, 2008 in Monterey County Superior Court Case No. M82496, which is the subject 22 of this action. 23 G. By operation of law, Defendant MECHANICS BANK, a California corporation is the 24 sole named defendant in this Action, and subject to any amendments in or to the 25 pleadings in this action, that all further captions and references identifying Defendant 26 MECHANICS BANK, a California corporation and its relationship to Rabobank, N.A., 27 shall be as follows: “Defendant MECHANICS BANK, a California corporation, 28 successor by merger to Rabobank, N.A.”. -3- STIPULATION AND ORDER TO SET ASIDE JUDGMENT 1 It is hereby further stipulated that the Defendant MECHANICS BANK, a California 2 corporation, successor by merger to Rabobank, N.A., shall file its Answer on the next court day upon 3 service of the Order setting aside the default. 4 Attached as Exhibit B is the Answer to be filed by Defendant MECHANICS BANK, a 5 California corporation, successor by merger to Rabobank, N.A. 6 DATED [Effective]: May 2, 2022. MATTHEW S. KENNEDY, A PROFESSIONAL LAW CORPORATION 7 Digitally signed by Matthew Scott Kennedy, Esq. Date: 2022.05.02 15:14:30 -07'00' 8 /s/ Matthew S. Kennedy, Esq. 9 Matthew S. Kennedy, Esq. Attorney for Defendant, MECHANICS BANK, 10 a California corporation, successor by merger to Rabobank, N.A. 11 Patane, Gumberg, Avila LLP 12 DATED [Effective]: May 2, 2022. 13 14 Andrea C. Avila, Esq. Attorney for Plaintiff, ROBERT T. ELLIOTT 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -4- STIPULATION AND ORDER TO SET ASIDE JUDGMENT 1 ORDER 2 Good cause appearing, the parties having made stipulation, the Default of 3 MECHANICS BANK, a California corporation, successor by merger to Rabobank, N.A. (and|or as 4 otherwise identified in the subject Complaint and this Stipulation) entered on March 25, 2022, is set 5 aside. Defendant MECHANICS BANK, a California corporation, successor by merger to Rabobank, 6 N.A., shall file its Answer on the next court day upon service of the Order setting aside the default. 7 8 DATED: , 2022 JUDGE OF THE SUPERIOR COURT 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -5- STIPULATION AND ORDER TO SET ASIDE JUDGMENT EXHIBIT A . , APPROVED 408323~8 STRICTLY CONFIDENTIAL August28,2019 MANUEL P. ALVAREZ Commissioner of Business oversight ooE,224 6t1,tv· FILED~ By v~f-u.!lf---- AGREEMENTANDPLANOFMERGER OF . Secretary of State Stat~ or CalifomiaOf ---- JENNIFER L.W. RUMBERGER Senior Counsel RABOBANK, N.A. ( ~AUG 29 2019t:J-- AND MECHANICS BANK This Agreement and Plan o Merger (this " eement"), dated as of June 17, 2019, is adopted and made by and between Mechanics B a California banking corporation, having its main office at 1111 Civic Drive, Walnut Creek, CA 94596 ("MB,,), and Rabobank, N.A. a national banking association, having its main office at 915 Highland Pointe Drive, Roseville, CA 95678 ("RNA"). . WITNESSETH: WHEREAS, MB is a California banking corporation; WHEREAS, RNA is a national banking association, 99.99% of the issued and outstanding. capital stock of which is owned as of the date hereof, and ·all of the issued and outstanding capital stock of which will be owned as of immediately prior to the consummation of the Acquisition (as defined below), directly by Pistachio NewCo Inc., a Delaware corporation (the "Holdco,,); WHEREAS, Holdco, as of the date hereof,. is a wholly owned subsidiary of Rabobank International Holding B.V., a,Besloten Vennootschap Met Beperkte Aansprakelijkheid organized under the laws ofthe Kingdomof~e Netherlands (the "Seller"); · ( WHEREAS, MB and the Seller have ent~red into a Stock Purchase Agreement, dated as o~ March 15, 2019 (the "Stock Purchase Agre~ment"), providing for the purchase (the "Acquisition") by MB from the.Seller of 100% of the issued :and outstanding shares of common stock of Holdco, and MB and Holdco have entel'Cd into an Agreement of Merger, dated as of the date hereof (the "Holdco Merger Agreement"), providing that following the closing of the Acquisition, Holdco will merge (the "Holdco Merger~') with and into MB, with MB as the surviving corporation in the Holdco Merger and continuing its corporate existence under the laws of the State of California; WHEREAS, contingent upon the Acquisition and the Holdco Merger and immediately following the effective time ·of the Holdco Merger, the parties to this Agreement intend to effect the merger of RNA with and into MB, with MB as the surviving institution (the "Bank MergerH), on the tenns and subject to the conditions contained in this Agreement; and WHEREAS, the respective boards of directors of MB and RNA have each adopted a resolution approving this Agreement &:id authorizing the execution hereof. NOW, THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth .and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and subject to the terms and conditions of the Stock Purchase Agreement, the parties hereto agree as follows: / A0832348 ARTICLE I .Constituent Entities MB and RNA shall be the constjtuent entities with respect to th~ Bank Merger. ARTICLE II · Bank Merger 2.1 Bank Merger. . Subject to the tenns and conditions of this Agreement, effective as of the Effective Time (as defined below), RNA shall be merged with and into MB in accordance with 12 U.S.C. § 1828(c) and Section 4880 et~- of the California ·Financial Code ("CFC"), and with the effect provided in Section 4889 of the CFC and Section 1107 of the California General Corporation Law. At the Effective Time (as defined below), the separate existence of~A shall cease, and MB, as the surviving institution (sometimes hereinafter referred to as the "Surviving Institution"), shall continue unaffected and unimpaired by the Bank Merger. The name of the Surviving· Institution .shall be "Mechanics Bank". 2.2 Effective Time. The Banlc Merger shall become effective immediately following the time when all of the conditions precedent to the consummation of the Bank Merger specified in this Agreement shall have been satisfied or duly waived by the party entitled to satisfaction thereof, this Agreement shall have been filed with the California Secretary of State, and the Surviving Institution shall have filed with the commissioner of the California Department of Business Oversight a copy of this Agreement certified by the California Secretary of State in accordance with Section 4887(b) of the CFC (such date and time being herein referred to as the "Effective Time"). ARTICLEID Charter, Bylaws, Etc. 3 .1 Articles of Incomoration. At the Effective Time, the articles of incorporation of MB in effect immediately prior to the Effective Time shall continue . to ·be the articles of incorporation of the Surviving Institution until thereafter amended in accordance. with applicable law. The articles of incorporation of MB as shall be in effect .immediately prior to the Effective Time are set forth as Exhibit A hereto and incorporated herein by reference. 3.2 Bylaws. At the Effective Time, the bylaws of MB in effect immediately prior to the Effective Time shall continue to be the bylaws of the Surviving Institution until thereafter amended in accordance with applicable .law. 3.3 Directors. At the Effective Time, the board of directors of the Surviving Institution will consist of the djrectors of MB immediately prior to the Effective Time. 3.4 Home Offices. The home office and branch offices of MB existing immediately prior to the Effective Time shall continue to be the home office and branch offices, respectively, of the Surviving Institution. Exhibit B sets forth RNA's home office and branch offices as of the 2 ,. ll0832348 .• date of this Agreement. Immediately following the Effective Time, the Surviving Institution shall continue to operate such home office and branch offices of RNA as set forth in Exhibit B as branch offices of the Surviving Institution at the address of each such office or branch listed therein. Notwithstanding anything to the contrary in the foregoing, branch offices of RNA and MB as set forth in Exhibit C will be closed or consolidated as of the Effective Time or following the Banlc Merger in compliance with applicable regulatory requirements and ·MB's branch closing and consolidation policy. · ARTICLE IV Capital Stock 4.1 Effect on RNA Capital Stock. By virtue of the Bank Merger and without any action on the part of the holder of any capital stock of RNA, at the Effective Time, all shares of RNA capital stock issued and outstanding shall be automatically cancelled and retired and shall cease to exist, and no cash, new shares of common stock, or other property shall be delivered in exchange therefor. 4.2 Effect on MB Capital Stock. Each share of MB capital stock issued and outstanding immediately prior to the Effective Time shall remain issued and outstanding and unaffected by the Ba~Merger. ARTICLEV Effect of Bank Merger The .effect of the Bank Merger shall be as prescribed by law, including Section 4889 of the CFC and Section 1107 of the California General Corporation Law. Without limiting the foregoing, from and after the Effective Time, (i) all rights, franchises and interests of each of the constituent entities in and to every type of property (whether real, personal, tangible or intangible) and choses in action shall be vested in the Surviving Institution by virtue of the Bank Merger . without any deed or other transfer; (ii) the Surviving Iitstitution, without any order or action on the part of any court or otherwise, shall hold and enjoy all such rights and property, franchises· and interests, including appointments, designations and nominations, an~ in .every other fiduciary capacity, in the same manner and to the same extent as such rights, franchises and interests were held or enjoyed by each of the constituent entities prior to the Effective.Time; (iii) all liabilities of each of the constituent entities shall become the Surviving Institution's liabilities; (iv) all debts, liabilities and contracts of each of the constituent entities, matured or unmatured, whether accrued, absolute, contingent or otherwise, and whether or not reflected or reserved against on balance sheets, books of accounts, or records of each of the constituent entities, shall be those of the Surviving Institution and shall not be released or impaired by the Bank Merger; (v) ail rights of creditors and other obligees and all liens on property of each of the constituent entities shall be preserved unimpaired; and (vi) the Surviving Institution shall be responsible for all obligations of each of the constituent entities and each claim existing and each action or proceeding pending by or against either of the constituent entities may be prosecuted as if the Bank Merger had not taken place, and the Surviving Institution may be substituted in the place of such constituent entity. 3 A-.0..83231+8 ARTICLE VI Conditions to the Bank Me~er The respective obligations ·of each of MB and RNA to consummate the Bank Merger are subject to the fulfillment, or written waiver by the party entitled to satisfaction ·thereof prior to the Effective Time, of each of the following conditions: (a) This Agreement shall have been approved and adopted by the written consent of the shareholders of RNA in lieu of a meeting of shareholders; (b) All approvals and authorizations of, filings and registrations with, and notifications to, all governmental authorities required for the consummation of the Bank Merger shall have been obtained or made and shall be in full force and effect and all waiting periods required by applicable law shall have expired or been tenninated; (c) No relevant governmental authority shall have enacted, issued, promulgated, enforced or entered any statute, rule, regulation, judgment, decree, injunction or other order (whether temporary, preliminary or permanent) which is in effect and prohibits consummation of the transactions contemplated by this Agreement; and (d) The Acquisition and .the Holdco Merger shall have been consummated pursuant to the Stock Purchase Agreement and the Holdco Merger Agreement, respectively. ARTICLE VII Further Documents If at any time the Surviving Institution shall consider or be advised that any further , deeds, assignments, conveyances or assurances in law are necessary or.desirable to vest, perfect or confirm of record in the Surviving Institution the title to any property or rights of the constituent entities, or otherwise to carry out the provisions hereof, the persons wJto were the proper officers and directors of the constituent entities immediately prior to the Effective Time (or their successors . in office) shall execute and deliver any and all proper deeds, assignments, conveyances and assurances in law, and do all things necessary or desirable, to vest, perfect or confirm title to such property or rights in the Surviving Institution and otherwise to carry out the provisions hereof. ARTICLEVIll . Termination . In the event that the Stock Purchase Agreement is terminated pursuant to the terms thereof, this Agreement shall be terminated and the Bank Merger provided for herein shall be abandoned automatically and without any further act or deed by the parties hereto. This Agreement also may be terminated at any time prior to the Effective Time by a written instrument executed by each of the parties hereto. 4 A0832348 AATICLEIX Miscellaneous 9.1 Representations and Warranties. Each of the parties hereto represents and warrants that this Agreement has been duly authorized, executed and delivered by such parcy and constitutes the legal, valid and binding obligation of such party, enforceable against it in accordance with the terms hereof, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and similar laws of general applicability relating to or affecting creditors' rights or by general equity principles. 9.2 Entire Agreement. This Agreement (including the documents and instruments referred to. herein and attached hereto), together with the Stock Purchase Agreement and the Holdco Merger Agreement, constitutes the entire agreement among the parties with respect to the subject matter hereof and supersedes all prior agreements and understandings, both written and oral, among the parties with respect to the subject matter hereof. 9.3 Counter.parts. This Agreement may be executed in counterparts (including by facsimile or other electronic means), each of which shall be deemed to be an original, but all of which shall constitute one and the same agreement. 9.4 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California, without regard to choice of law principles. 9.5 Assignment. This Agreement shall not be assignable by either party. 9.6 Norisurvival of Agreements. None of the agreements in this Agreement or in any instrument delivered pursuant to this Agreement shall survive the Effective Time or termination of this Agreement pursuant to Article VIII. · 9.7 Amendment. This Agreement may not be amended, except by an instrument in writing signed on behalf ofeach of the parties hereto. · 9.8 Notices. All notices or other communications hereunder to a party shall be deemed to have been duly given and made if in writing and if served by personal delivery, if delivered by registered or certified mail (return receipt requested), or by a national courier service, or by email so long as such email states it is a notice delivered pursuant to this section and is confirmed with a telephone call to·the recipient: · IftoRNAto: Rabobank, N .A. 915 Highland Pointe, Suite 350 Roseville, California · 95678 · Attention: Lynette Hotchkiss Telephone: (916) 878-4689 Email: Lynette.Hotchkiss@rabobank.com 5 '10832348 With a copy (which shall not constitute notice) to: Cooperatieve Rabobank U.A. Croeselaan 18 3521 CB Utrecht Attention: Jan Schuchard, Head Legal Telephone: +31 30 2163303_ Email: J.Schuchard@rabobank.nl and Sullivan & Cromwell LLP 125 Broad Street· New York, New York 10004 Attention: Donald J. Towney Stephen M. Salley Telephone: (212) ~58-4000 . Email: toumeyd@sullcrom.com salleys@sullcrom.com Ifto MB to: Mechanics Bank 1111 Civic Drive Walnut Creek, California 94596 Attention: Glenn Shrader Email: glenn_shrader@mechanicsbank.com With a copy (which shall not con~titute notice)to: Wachtell, Lipton, Rosen & Katz 51 West 52nd Street New York, New York 10019 Attention: David E. Shapiro, Esq. l acob A. Kling, Esq. · Fax: (212) 403-2000 Email: DEShapiro@wlrk.com JAK1ing@wlrk.com [Signature pages follow] 4083231+·8 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed on their behalf by their respective officers thereunto duly authotized as of the day and year first written above. SURVIVING CORPORATION MECHANICSBANK By: ~~--- ~~ N~W. DeCero · - Title: President and Chief Executive Officer · By:Na~~ Title: · Secretary DISAPPEARIN_G CORPORATION RABOB~, N.A. By: Name: Mark Borrecco Title: Chief Executive Officer By: Name: Lynette Hotphkiss Title: General CQtmSel and Secretary J {Signature Page ·to the Agreement and Plan ofMerger] IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed on their behalf by their respective officers thereunto duly authorized as of the day and year first written above. SURVIVING CORPORATION MECHANICS BANK By: Name: John W. DeCero Title: President and Chief Executive Officer By: Name: Laura Jacob Title: Secretary DISAPPEARING.CORPORATION RABOBANK, N.A. By: .. .' . . . . .. . · ~ · ~Chief:omcer [Signature Page to the Agreement and Plan ofMerger] . A0832348 EXHIBIT A ARTICLES OF INCORPORATION RESTATED ARTICLES OF INCORPORATION OF IvlECHANICS BANK ARTICLE I The name of this corporation shall be Mechanics Bank (the "Corporation"). ARTICLE II The purpose of the Corporation is to engage in commercial banking business and trust business and any other lawful activities that are not, by applicable laws or regulations, prohibited to a commercial bank authorized to engage in trust business. ARTICLEID 1. CAPITALIZATION. The amount of capital stock that the Corporation is authorized to issue is five hundred thousand (500,000) shares having a total p~ value of fifteen million dollars ($15,000,000), consisting ofthree hundred thousand (300,000) shares of Common Stock of the par value of fifty dollars ($50) per share ("Common Stock") arid.two hundred thousand (200,000) shares of Preferred Stock of no par value per share ("Preferred Stock"). The shares of Common Stock shall be divided into two series, two hundred eighty thousand (280,000) shares of which shall be designated ,svoting Common Stock," and twenty thousand (20,000) shares of which shall be designated ''Non-Voting Common Stock." Except as expressly provided herein, the rights, preferences and privileges of the Voting Common Stock and Non-Voting Common Stock shall be in all respects and for all purposes and in a.II circumstances absolutely and completely identical; provided, that if the Corporation shall in any manner split, subdivide or combine the outstanding shares of Voting Common Stock or Non-Voting Common Stock, the outstanding shares· of the other series shall likewise be split,subdivided or combined in the same manner proportionately and on the same basis per share; and provided,further, that no dividend or distribution payable in shares of Voting Common Stock shall be declared on the Non-Voting Common Stock and no dividend or distribution payable in Non-Voting Common Stock shall be declared on the Voting Common Stock, but instead, in the cas·e of a stock dividend or distribution, such dividend or distribution shall be received in like stock (or in such other form as the Board of Directors of the Corporation may determine in accordance with applicable law). A083.2348 2: VOTING RIGHTS. Each share of Voting Common Stock shall be entitled to one vote. Except as otherwise required by applicable law ot expressly provided herein, the Non-Voting Common Stock shall have no voting power. 3. CONVERSION. The shares ofNon-Voting Common Stock will not be convertible into shares of Voting. Common •Stock, except in ·connection with a Covered Transfer. Upon completion·of a Covered Transfer, each share ofNon- Voting Common Stock transferred in such Covered Transfer will automatically, without action by any holder or transferee of such shares, ·be converted into one ( 1) fully paid and nonassessable ·share of Voting Common .Stock (subject to adjustment, if appropriate, in the event of any stock dividend, stock split, combination or other recapitalization). "Covered Transfer'' means a transfer by a holder of shares of Non-Voting Common Stock to a person that is not an affiliate (as "affiliate" is defined in the Bank Holding Company Act of 1956, as amended) of such holder (a) in a widely dispersed publjc offering (including assignment to a single party (e.g., broker or investment banker) for the purposes of conducting a widespread pubic distribution), (b) in a private sale in which no purchaser (or group of associated purchasers) would acquire Voting Common Stock and/or Non-Voting Common Stock in an amount that, after- the conversion of such Non-Voting Common Stock into Voting Common Stock, is (or represents) two percent (2%) or more of a class of the Corporation's voting securities or (c) where such transferee would control a majority of the Corporation's voting securities notwithstanding such transfer.