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FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1994
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from____________to________________
Commission File Number: 1-6451
UJB Financial Corp.
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(Exact name of registrant as specified in its charter)
New Jersey 22-1903313
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
301 Carnegie Center, P.O. Box 2066, Princeton, New Jersey 08543-2066
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(Address of principal executive offices) (Zip Code)
(609) 987-3200
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(Registrant's telephone number, including area code)
____________________________________________________________________
(Former name, former address and former fiscal year, if changed since
last report).
Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
[X] Yes [ ] No
As of July 31, 1994 there were 54,740,460 shares of common stock,
$1.20 par value, outstanding.
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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
In accordance with Instruction D., included herein as Exhibit
(28)A is UJB Financial Corp. consolidated balance sheets as of
June 30, 1994, December 31, 1993 and June 30, 1993; as Exhibit
(28)B is UJB Financial Corp. consolidated statements of income
for the six months and three months ended June 30, 1994 and
1993; and as Exhibit (28)C is UJB Financial Corp. consolidated
statements of cash flows for the six months ended June 30, 1994
and 1993. Also included herein as Exhibit (28)D is UJB
Financial Corp. consolidated statements of shareholders' equity
as of June 30, 1994 and 1993; and as Exhibit (28)E is UJB
Financial Corp. consolidated average balance sheets with
resultant interest and rates for the six months ended June 30,
1994 and 1993.
The consolidated financial statements included herein as
Exhibits include the accounts of UJB Financial Corp. and all of
its subsidiaries (the Company). Significant intercompany
transactions have been eliminated in consolidation.
The consolidated financial statements have been prepared on an
accrual basis. For additional information and disclosures
required under generally accepted accounting principles,
reference is made to the registrant's 1993 Annual Report on Form
10-K.
The accompanying financial statements reflect in the opinion of
management, all normal, recurring adjustments necessary to
present fairly the financial position of the Company and
subsidiaries, and the results of their operations and changes in
their cash flows. The financial statements presented, in all
material respects, comply with the current reporting
requirements of supervisory authorities.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.
Financial Condition
Total assets at June 30, 1994 were $14.5 billion, an increase of
$1.1 billion or 7.8 percent from year-end 1993. Compared to
June 30, 1993, total assets increased $922.9 million or 6.8
percent.
At June 30, 1994, investment securities available for sale,
reported at fair value, amounted to $192.6 million. These
securities decreased $969.5 million or 83.4 percent from
year-end 1993, and comprised $127.6 million of U.S. Government
and agency collateralized mortgage obligations (CMOs) and $65.0
million of other securities. As of June 30, 1994, a review of
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the composition of the investment portfolio and investments
securities available for sale was made for the purpose of
determination of the appropriate classification as of the
balance sheet date. The review included an assessment of
ongoing investment strategies coupled with future liquidity
needs. Additional funding sources are now available to the
Company through its recent affiliation with the Federal Home
Loan Bank of New York. As a result of the review, $707.8
million were transferred from available-for-sale category to
held-to-maturity category. This transfer consisted of $360.2
million of U.S. Government and agency CMOs and $347.6 million of
other securities predominately corporate CMOs. The transfer was
made at market value and the depreciation at the date of
transfer will be amortized over the life of the securities.
During the six months of 1994, $3.4 million of investment
securities available for sale were sold. Total maturities were
$246.1 million during the six month period. Unrealized gains
and losses on investment securities available for sale were
recorded net of taxes as a separate component of shareholders'
equity. As of June 30, 1994, the unrealized loss recorded in
equity amounted to $5.3 million.
Investment securities at June 30, 1994 increased $1.6 billion or
63.5 percent from year-end 1993. The increase in the investment
portfolio was the result of $1.5 billion in purchases,
principally in CMOs, and the transfer of $707.8 million of
investment securities available for sale to investment
securities, offset by maturities of $632.6 million during the
six months of 1994. Since December 31, 1993, other securities
increased $967.1 million as investment strategies were directed
toward the purchase of whole loan CMOs. Compared to June 30,
1993 the investment portfolio increased $1.0 billion or 34.9
percent.
Total loans increased $352.4 million or 4.1 percent from
December 31, 1993 to $9.0 billion at June 30, 1994. Compared to
June 30, 1993, total loans increased $259.0 million or 3.0
percent. From December 31, 1993, commercial loans increased
$225.4 million or 5.3 percent to $4.5 billion at June 30, 1994.
Commercial loans increased $141.7 million or 3.3 percent
compared to June 30, 1993. Mortgage loans decreased $13.0
million or .5 percent from December 31, 1993 to $2.4 billion at
June 30, 1994. Compared to June 30, 1993, mortgage loans
increased $6.3 million or .3 percent. Instalment loans
increased $139.9 million or 7.0 percent from December 31, 1993
to $2.1 billion. Compared to June 30, 1993 instalment loans
increased $111.0 million or 5.5 percent.
At the end of the second quarter of 1994, non-performing loans
were $225.7 million or 2.52 percent of total loans. This
compares to $251.7 million or 2.92 percent at year-end 1993, and
$296.0 million or 3.40 percent at the end of the second quarter
of 1993. In the second quarter of 1994, non-performing loans
decreased by $26.0 million from the year-end 1993 and were down
$70.3 million from June 30, 1993.
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The following table summarizes the trends in the components of
non-performing loans (in thousands):
<TABLE>
<CAPTION>
Jun. 30, Dec. 31, Jun. 30,
1994 1993 1993
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<S> <C> <C> <C>
Commercial and industrial $ 43,076 $ 57,325 $ 71,794
Real estate:
Construction and development 87,740 87,402 103,780
Real estate related 94,890 106,999 120,445
-------- -------- --------
Total real estate 182,630 194,401 224,225
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Total $225,706 $251,726 $296,019
======== ======== ========
</TABLE>
At June 30, 1994, other real estate was $68.4 million, net of a
$29.9 million allowance. Since December 31, 1993, other real
estate decreased $3.9 million. Compared to June 30, 1993 these
net balances decreased $35.4 million.
The allowance for loan losses at June 30, 1994 was $236.7
million or 2.64 percent of loans, compared to $242.1 million or
2.81 percent of loans at December 31, 1993 and $248.7 million or
2.86 percent of loans at June 30, 1993. For the three months
ended June 30, 1994, net charge offs were $21.3 million or .97
percent of average loans compared to $29.4 million or 1.35
percent during the comparable period in 1993. For the six
months ended June 30, 1994, net charge offs were $42.4 million
or .98 percent of average loans compared to $76.6 million or
1.77 percent during the comparable period in 1993.
At June 30, 1994 total deposits were $11.6 billion, an increase
of $103.9 million or .9 percent from December 31, 1993 and
increased $94.9 million or .8 percent from a year ago. Retail
savings and time deposits decreased $143.0 million or 1.7
percent from year end to $8.3 billion and decreased $373.0
million or 4.3 percent from June 30, 1993. Commercial
certificates of deposit $100,000 and over were $298.4 million,
an increase of $71.8 million or 31.7 percent compared to
December 31, 1993 and increased $29.0 million or 10.8 percent
compared to June 30, 1993. Demand deposits increased $175.2
million or 6.3 percent from year-end 1993 to $3.0 billion and
increased $438.8 million or 17.3 percent from June 30, 1993.
Other borrowed funds increased $865.5 million or 157.5 percent
from December 31, 1993 to $1.4 billion. Compared to June 30,
1993, other borrowed funds increased $726.8 million. Other
borrowed funds increased principally to fund the growth in the
investment and loan portfolios since year-end 1993. At June 30,
1994, long-term debt was $206.3 million, a decrease of $2.1
million or 1.0 percent from year-end 1993. Compared to June 30,
1993, long-term debt increased $11.2 million or 5.7 percent.
This increase reflects the impact of the issuance of $20.0
million private placement notes during the third quarter of 1993
offset by principal paydowns on long-term debt.
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Total shareholders' equity increased $38.1 million or 3.9
percent from December 31, 1993 to $1.0 billion. Included in
shareholders' equity is a $5.3 million net unrealized loss (net
of tax) on investment securities available for sale. The
leverage ratio of the company was 7.01 percent compared to 7.07
percent at December 31, 1993. At June 30, 1993, the leverage
ratio was 6.80 percent. Under the risk-based capital
guidelines, the Company's Tier I capital was 9.21 percent and
total capital was 12.12 percent at June 30, 1994, compared with
9.37 percent and 12.43 percent, respectively, at December 31,
1993. The decline in these ratios since year-end 1993 is
attributable to the $1.1 billion increase in assets. At June 30, 1993,
the Tier I capital ratio was 9.07 percent and total capital was
12.14 percent. The current minimum regulatory guidelines for
Tier I and total capital ratios are 4.0 percent and 8.0 percent,
respectively.
Results of Operations
For the second quarter of 1994, net income was $31.6 million or
$.60 per share compared with net income of $22.4 million or $.43
per share earned during the second quarter of 1993. Net income
for the six months ended June 30, 1994 was $59.0 million
compared with $42.8 million for the first half of 1993. On a
per share basis, net income for the six months ended June 30,
1994 was $1.12 compared to $.82 for the same period in 1993.
The results for the first six months of 1994 were impacted by
the adoption of SFAS 112, "Employers' Accounting for
Postemployment Benefits", which had the effect of reducing net
income by $1.7 million or $.03 per share. The 1993 first half
results were impacted by the adoption of SFAS 109, "Accounting
for Income Taxes". The adoption of SFAS 109 had a favorable
effect on 1993's net income of $3.8 million or $.07 per share.
Interest income on a tax-equivalent basis was $448.6 million for
the six months ended June 30, 1994, a decrease of $8.6 million
or 1.9 percent compared to the same period in 1993. The
decrease in interest income was primarily due to a lower
interest rates during the first six months of 1994 compared to
the prior year. Partially offsetting this decline were volume
increases in investment securities and investment securities
available for sale and the benefit of reduced levels of
non-performing loans. Interest earning assets averaged $13.0
billion during the first six months of 1994, an increase of
$443.0 million or 3.5 percent over the same period of 1993.
Interest expense decreased $19.2 million or 11.3 percent for the
six months ended June 30, 1994 compared to the same period in
1993. The benefit of lower rates during the first six months of
1994 and the impact on the cost of retail time deposits compared
to 1993 was the primary factor in the decline in interest
expense. The costs on these deposits decreased $30.3 million or
21.7 percent. Consumer preference continued to shift out of
retail certificates of deposit toward more liquid accounts that
are generally lower-yielding. Offsetting this decline was an
increase in interest expense on borrowed funds and commercial
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certificates of deposit over $100,000 which rose $10.3 million and $.9
million, respectively, over the 1993 six-month period. These
increases were principally due to volume increases. Total
borrowed funds, including commercial paper and long-term debt,
increased $422.1 million and commercial certificates of deposit
over $100,000 increased $25.6 million, on average, compared to
the prior year period. Demand deposits averaged $2.8 billion
during the six months ended June 30, 1994, an increase of $381.1
million or 15.6 percent over the comparable period in 1993.
Net interest income on a tax-equivalent basis was $297.7 million
for the first six months of 1994 compared with $287.1 million
for the six months ended June 30, 1993, an increase of $10.6
million or 3.7 percent. The net interest spread percentage on a
tax-equivalent basis (the difference between the rate earned on
average interest earning assets and the rate paid on average
interest bearing liabilities) was 3.98 percent for the six
months ended June 30,1994, unchanged from June 30, 1993. Net
interest margin (net interest income on a tax-equivalent basis
as a percentage of average interest earning assets) was 4.63
percent during the six months of 1994 compared with 4.62 percent
during the same period in 1993.
The provision for loan losses for the quarter ended June 30,
1994 was reduced 26.0 percent to $18.5 million compared to $25.0
million for the same period a year earlier. On a year-to-date
basis, the provision was $37.0 million, a decline of $13.0
million or 26.0 percent, compared with the first half of 1993.
This reduction in the provision for loan losses reflects the
continued decline in the levels of non-performing loans.
Non-interest income, including securities transactions, for the
second quarter of 1994 totaled $43.5 million, an increase of
$2.3 million or 5.6 percent compared with the second quarter
of 1993. For the six months ended June 30, 1994, non-interest
income totaled $87.2 million, a decrease of $1.1 million or
1.2 percent from the prior year period. Most of this decline can
be attributable to the decrease in securities gains in 1994 when
compared to 1993.
For the second quarter of 1994, net gains on the sale of
investment securities were $.5 million, compared with
net gains of $.2 million in 1993. For the first six months
of 1994, net gains were $1.8 million, compared with net
gains of $6.8 million in 1993. These gains were recognized
as securities were sold out of the available for sale portfolio.
For the second quarter of 1994, service charges on deposits were
$16.3 million, an increase of $1.5 million or 10.4 percent over
the prior year period. Service charges on deposits increased
$2.7 million or 9.0 percent during the six month period ended
June 30, 1994 compared to the corresponding period in 1993. The
increase for the quarter and year-to-date in service charges was
primarily due to price increases implemented after June 30,
1993. Service and loan fee income for the second quarter
increased $1.9 million or 23.0 percent compared with the quarter
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ended June 30, 1993 and $3.3 million or 20.4 percent compared
to the six months ended June 30, 1993. These increases were
primarily due to higher merchant credit card fees. Trust fee
income increased $.1 million or 2.5 percent compared to the
second quarter of 1993. This income rose $.4 million or 3.4
percent during the first half of 1994 compared to the same
period in 1993. During the second quarter of 1994, other income
decreased $1.2 million or 9.5 percent from the second quarter in
1993. On a year-to-date basis, other income declined $1.6
million or 6.7 percent compared to the six months ended June 30,
1993. These declines were attributable to lower secondary
market mortgage fees and brokerage fees recorded during the
three months and six months ended June 30, 1994 compared to the
1993 periods.
Non-interest expenses for the second quarter of 1994 totaled
$123.9 million, down $4.0 million, or 3.1 percent compared to
the second quarter of 1993 and for the six months ended June 30,
1994 were $246.3 million, down $18.4 million or 6.9 percent from
the year ago period. This was due in part to the continued progress
resulting from the restructuring program announced in September 1993.
On July 15,1994 the three New Jersey banks were combined into one
New Jersey bank. The three Pennsylvania banks were combined into
one in March 1994.
Salaries expense decreased $1.2 million or 2.6 percent during the
second quarter of 1994 compared to the second quarter of 1993 and
declined $2.0 million or 2.3 percent during the first half of
1994 compared to the corresponding period of 1993. Pension and
other employee benefits for the second quarter were $13.3 million,
down $.7 million or 4.8 percent over the second quarter of 1993.
These expenses were $27.1 million for the six months ended
June 30, 1994, down $1.8 million or 6.1 percent compared to the
corresponding period in 1993. The decrease in salaries and benefit
expense was partially attributable to the staff savings realized
from the restructuring program.
Occupancy expense for the second quarter of 1994 increased $.4
million or 3.4 percent compared to the prior year period. This
expense was $25.8 million for the six months ended June 30, 1994
and rose $1.4 million or 5.9 percent compared to the
corresponding period in 1993. This increase was principally due
to higher snow removal costs as a result of severe weather
conditions during 1994. Furniture and equipment expense rose
$.9 million or 7.9 percent for the quarter, and rose $1.8
million or 8.3 percent during the first half of 1994. The
increase over the prior year period resulted from increased
equipment rentals and maintenance expenses related to the
installation of new on-line equipment to support branch
automation.
The FDIC insurance assessment decreased $1.2 million or 15.5
percent during the second quarter of 1994 compared to the second
quarter of 1993 and was down $2.6 million or 15.9 percent during
the first half of 1994 compared to the corresponding period in
1993. This decrease reflects the impact of the reduced
assessment rates under the risk-based assessment system
implemented in accordance with the Federal Deposit Insurance
Corporation Improvement Act of 1991.
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Other real estate expenses were $5.5 million for the second
quarter of 1994, a decrease of $2.5 million or 31.4 percent from
the second quarter of 1993. On a year-to-date basis, other
real estate expenses were $9.6 million, a decrease of $13.4
million or 58.4 percent, compared to the six months ended June
30, 1993. Included in these amounts is a provision for losses
on other real estate and expenses related to holding and
operating foreclosed property. A provision of $3.5 million for
the second quarter and $5.9 million for the first six months of
1994 was added to the allowance for other real estate. This
compares to a provision of $6.1 million for the second quarter
of 1993 and $18.6 million for the first half of 1993. Expenses
for operating and maintaining other real estate amounted to $2.0
million for the second quarter and $3.7 million for the six
months ended June 30, 1994 compared with $1.9 million and $4.3
million for the first six months of 1993.
Liquidity
Liquidity is a measure of the ability to meet present and future
funding obligations and commitments. Bank liquidity is the
ability to meet the borrowing needs and deposit withdrawal
requirements of customers and to support asset growth.
Principal sources of liquidity are deposit generation, access to
purchased funds, maturities and repayments of loans and
investment securities, and interest and fee income.
The consolidated statements of cash flows present the change in
cash and cash equivalents from operating, investing and
financing activities. During the six months of 1994, net cash
provided by operating activities totaled $158.8 million. This
amount was primarily attributable to results of operations
adjusted for the provision for loan losses and other real estate
owned, and proceeds from the sales of mortgages held for sale.
Net cash used in investing activities totaled $1.0 billion and
was the result of investment and loan activity. Net cash
provided by financing activities totaled $958.2 million,
reflecting the increases in short-term borrowings.
During the first six months of 1994, proceeds of $878.7 million
from maturities in the investment portfolio, including
investment securities available for sale, contributed to
liquidity. Borrowed funds, which includes Federal funds and
repurchase agreements and commercial paper increased $872.0
million since December 31,1993 and provided another source
of liquidity. Offsetting these sources were purchases of
$1.5 billion of investment securities and an increase of
$352.4 million in loans since year-end 1993.
Demand deposits increased $438.8 million to $3.0 billion from a
year ago. Offsetting this increase in liquidity, savings and
time deposits declined $373.0 million from June 30, 1993,
primarily in the category of retail certificates of deposits.
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Additional liquidity is accessible from maturities and principal
repayments in the investments portfolio. Scheduled maturities
and anticipated principal repayments of the investment portfolio
will approximate $350 million throughout the balance of 1994.
In addition, all or part of the investment securities available
for sale of $192.6 million could be sold to provide liquidity.
These sources can be used to meet the funding needs during
periods of loan growth. Liquidity is also available through
the recent affiliation with the Federal Home Loan Bank of New
York , additional lines of credit and the ability to incur
additional debt. At June 30, 1994, there were $40.0 million of
short-term lines of credit available for general corporate
purposes, with no outstandings.
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PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Poseidon Pools, Inc. Suits
Reported on Form 10-K for the period ended December 31, 1993.
UJB has been advised that the plaintiffs in Richard Fleck and
Diane Fleck v. Atreo Manufacturing Co., Inc. et al. pending in
the state court in Pennsylvania have agreed to dismiss this
matter. Once the dismissal is filed with the court, this
matter will be concluded.
McAdoo CERCLA Matter
Reported on Form 10-K for the period ended December 31, 1993.
On May 25, 1994, the Third Circuit vacated the District Court's
orders denying the motion to intervene and approving the
Consent Decree, holding that the Initial PRPs may intervene as
a matter of right in the Alcan litigation if they can prove
that they have a protectable interest in that litigation.
Consequently, the case has been remanded to the District Court
to determine whether the Initial PRPs have a protectable
interest in the Alcan litigation. A case management conference
was held on August 4, 1994.
In re Payroll Express Corporation of New York and Payroll
Express Corporation, United States Bankruptcy Court for the
Southern District of New York, Case Nos. 92-B-43149 (CB) and
92-B-43150 (CB), filed June 5, 1992.
Reported on Form 10-K for the period ended December 31, 1993.
The Frederick Goldman and the Beth Israel customer matters
pending in the United States District Court for the District of
New Jersey were consolidated. On June 13, 1994, Judge Bassler
entered an order staying the consolidated action until the
United States District Court for the Southern District of New
York decides another UJB motion (described below) to withdraw
the reference of the Trustee's preference complaint from the
bankruptcy court to the District Court for the Southern
District of New York.
UJB filed a motion on February 24, 1994 to withdraw the
reference of the Trustee's preference complaint captioned John
S. Pereira, as Chapter 11 Trustee of the Estate of Payroll
Express Corporation et al. v. United Jersey Bank (the
"Preference Complaint") from the bankruptcy court to the United
States District Court for the Southern District of New York.
UJB then filed a motion with the bankruptcy court on March 14,
1994 to stay any proceedings in the bankruptcy court until the
District Court ruled on UJB's motion to transfer. The motion
to stay the bankruptcy court proceedings was granted on March
29, 1994. UJB then filed an Answer on April 8, 1994 denying the
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material allegations of the Trustee's Preference Complaint. The
motion to remove this matter to the Southern District of New
York is still pending.
ITEM 5. OTHER INFORMATION.
In December 1993, the Company entered into an agreement to
acquire VSB Bancorp, Inc. and its wholly-owned subsidiary Valley
Savings Bank. The transaction, accounted for as pooling-of-
interests, was consummated on July 1, 1994 in an exchange of
.7727 shares of UJB Financial Corp. common stock for each share
of VSB Bancorp, Inc. common stock. There were 2,628,912 shares
of UJB Financial Corp. common stock issued for 3,402,619 shares
of VSB Bancorp, Inc. common stock. At June 30, 1994, VSB
Bancorp, Inc. had total assets of $381.1 million. Combined
condensed consolidated results of operations of UJB Financial
Corp. and its subsidiaries and VSB Bancorp, Inc. for the three
months and six months ended June 30, 1994 were as follows (in
thousands):
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, 1994 June 30, 1994
----------------- --------------
<S> <C> <C>
Net interest income $151,018 $296,321
Net income 28,696 57,256
Net income per common share .52 1.03
</TABLE>
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ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits
(3)A.(i) Restated Certificate of Incorporation of UJB
Financial Corp., as restated July 1, 1988, as amended
through May 19, 1994.
(3)A.(ii) Amendment, dated May 19, 1994, to the Restated Certificate
of Incorporation of UJB Financial Corp., as restated
July 1, 1988.
(11) UJB Financial Corp. computation of net income per common
share for the six months and to the three months ended
June 30, 1994 and 1993.
(28)A UJB Financial Corp. consolidated balance sheets as of
June 30, 1994, December 31, 1993 and June 30, 1993.
(28)B UJB Financial Corp. consolidated statements of income
for the six months and three months ended June 30, 1994
and 1993.
(28)C UJB Financial Corp. consolidated statements of cash flows
for the six months ended June 30, 1994 and 1993.
(28)D UJB Financial Corp. consolidated statements of
shareholders' equity as of June 30, 1994 and 1993.
(28)E UJB Financial Corp. consolidated average balance sheets
with resultant interest and rates for the six months
ended June 30, 1994 and 1993.
(b) Reports on Form 8-K
In a current report on Form 8-K, dated May 19, 1994, the
Company, under Item 5 - Other Events, and Item 7 - Financial
Statements and Exhibits, reported the following:
On May 19, 1994, the Company and Palisade Savings Bank,FSB, a
federally chartered stock savings association with assets of
approximately $304 million ("PSB"), entered into an Agreement
and Plan of Merger (the "Agreement") providing for the merger of
PSB with and into an interim, federally-chartered stock savings
association subsidiary of the Company and the payment of $42.1
million to U. S. Thrift Opportunity Partners, LP, the sole
stockholder of PSB ("USTOP"), upon the satisfaction of the terms
and conditions set forth in the Agreement, including the receipt
of approvals from the Board of Governors of the Federal Reserve
System, the Office of Thrift Supervision and USTOP.
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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 thereunto duly authorized.
UJB FINANCIAL CORP.
-------------------
Registrant
DATE: August 15, 1994 BY: /s/ William J. Healy
--------------------
William J. Healy
Executive Vice President and Comptroller
(Chief Accounting Officer)
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EXHIBIT INDEX
Exhibit No.
-----------
(3)A.(i) Restated Certificate of Incorporation of UJB
Financial Corp., as restated July 1, 1988, as
amended through May 19, 1994.
(3)A.(ii) Amendment, dated May 19, 1994, to the Restated
Certificate of Incorporation of UJB Financial Corp.,
as restated July 1, 1988.
(11) UJB Financial Corp. computation of net income per
common share for the six months and to the three
months ended June 30, 1994 and 1993.
(28)A UJB Financial Corp. consolidated balance sheets as
of June 30, 1994, December 31, 1993 and June 30, 1993.
(28)B UJB Financial Corp. consolidated statements of income
for the six months and three months ended June 30,
1994 and 1993.
(28)C UJB Financial Corp. consolidated statements of cash
flows for the six months ended June 30, 1994 and 1993.
(28)D UJB Financial Corp. consolidated statements of
shareholders' equity as of June 30, 1994 and 1993.
(28)E UJB Financial Corp. consolidated average balance
sheets with resultant interest and rates for the
six months ended June 30, 1994 and 1993.
EXHIBIT (3)A.(i)
RESTATED
CERTIFICATE OF INCORPORATION
OF
UJB FINANCIAL CORP.
(Restated July 1, 1988)
As Amended Through May 19, 1994
UJB FINANCIAL CORP., a corporation formed pursuant to the provisions of
the New Jersey Business Corporation Act (N.J.S.A. 14A: 1-1 et. seq.), hereby
restates its Certificate of Incorporation pursuant to the provisions of
the New Jersey Business Corporation Act (N.J.S.A. 14A:9-5).
1. The name of the Corporation is UJB FINANCIAL CORP. [Amendment dated
5/31/89, filed 6/2/89, effective 6/30/89]
2. The purposes for which the corporation is formed are:
A. To engage in and carry on the business of a registered bank
holding company.
B. To acquire, by purchase, subscription or otherwise, own, hold
for investment or otherwise, use, sell, exchange, mortgage, pledge,
hypothecate, create a security interest in, or otherwise deal with and
dispose of, any and all securities, as hereinafter defined, and to pos-
sess and exercise any and all rights, powers and privileges of ownership
of any and all such securities, including the right to vote thereon and
to consent, assent or dissent with respect thereto for any and all
purposes, and to issue or deliver its own securities in payment or
exchange, in whole or in part, for any securities or to make payment
therefor by any other lawful means; to aid by loan, subsidy or in any
other lawful manner any corporation, firm, organization, association or
other entity in which the Corporation may be or become interested
through the direct or indirect holding of securities or in any other
manner; to do any and all acts and things for the enhancement, protection
or preservation of any securities which are in any manner, directly or
indirectly, held or guaranteed by the Corporation, and to do any and all
acts and things designed to accomplish any such purpose.
The term "securities", as used in this article, shall mean any
and all shares, stocks, bonds, debentures, notes, acceptances, voting
trust certificates, certificates of deposit, evidences of indebtedness,
other obligations, certificates of any interest in or of the deposit of
any of the foregoing, scrip, interim or other receipts, warrants or
rights to subscribe for or purchase, or guarantees of, any of the
foregoing, or any other interests or instruments commonly known as
securities.
C. To the extent permitted by law, to cause to be formed,
organized, reorganized, consolidated, merged or liquidated and to take
charge of, any corporation, firm, organization, association or other
entity, foreign or domestic.
D. To the extent permitted by law, to furnish services to and
perform services for, and to act in any representative capacity for, any
corporation, firm, organization, association, or other entity in
which
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the Corporation may be or become interested through the direct or
indirect holding of securities or in any other manner, whether in the
development, exploitation, promotion, operation, management,
liquidation, or otherwise, of any of the business or property thereof or
of any lawful enterprise related thereto.
E. To make loans and give other forms of credit with or without
security.
F. To borrow money for its corporate purposes; to draw, make,
accept, endorse, execute, issue, deliver and negotiate bonds, debentures,
promissory notes, drafts, bills of exchange and other negotiable or
transferable instruments and to secure the payment thereof and the
interest thereon by a deed or deeds of trust or by mortgage or pledge of
or upon, or by the creation of a security interest in, all or any part of
the property of the Corporation, real or personal, or any interest
therein, wherever situated, whether at the time owned or thereafter
acquired, and to sell, pledge, create a security interest in or otherwise
dispose of such bonds, debentures, notes or other obligations.
G. To purchase, lease or otherwise acquire, take, hold, own, use,
improve, maintain, develop, complete, extend, manage, operate, mortgage
or otherwise impose a lien upon or create a security interest in, sell,
exchange, lease or otherwise dispose of or convey or transfer in any
manner, buildings, storage and other facilities, real and personal
property of all kinds, and any and all rights, interests or easements
therein, without limit as to amount and wherever situated.
H. To engage in any such activity directly or through a subsidiary
or subsidiaries, and to take all acts deemed appropriate to promote
the interest of such subsidiary or subsidiaries, including without
limiting the foregoing, making contracts and incurring liabilities
for the benefit of such subsidiary or subsidiaries; and transferring or
causing to be transferred to any such subsidiary or subsidiaries assets
of the Corporation.
I. To guarantee the bonds, debentures, notes or other evidences of
indebtedness issued, or obligations incurred by subsidiary companies
in which the Corporation holds, directly or indirectly, at least a
majority of the voting stock, or by any corporation, partnership,
limited partnership, joint venture or other association where the
Corporation has or may acquire a substantial interest in such
corporation, partnership, limited partnership, joint venture or other
association or where such guarantee is otherwise in furtherance of the
interest of the Corporation.
J. To provide that the obligations of such subsidiary companies may
be convertible into, or exchangeable for, or carry rights or options to
purchase or subscribe to, or both, shares of the Corporation of any class.
K. In general, to do any and all of the acts and things herein set
forth to the same extent as natural persons could do, and in any part of
the world, as principal, factor, agent, contractor or otherwise, either
alone or in company with any person, entity, syndicate, partnership,
association, corporation or others; to establish and maintain offices and
agencies within and anywhere outside of the State of New Jersey; and to
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<PAGE>
exercise all or any of its corporate powers and rights in the State of
New Jersey and in any and all other states, territories, districts,
possessions or dependencies of the United States of America and in any
other countries or places.
L. To do everything necessary, proper, advisable or convenient for
the accomplishment of any of the purposes herein set forth and to do
every other act and thing incidental thereto or connected therewith,
provided the same be not forbidden by law.
3. The total number of shares of capital stock authorized and which may
be issued by this Corporation is One Hundred Thirty-Four Million
(134,000,000) shares, of which One Hundred Thirty Million (130,000,000)
shares of One and 20/100 Dollars ($1.20) par value each shall be designated
as Common Stock, and of which Four Million (4,000,000) shares without par
value shall be designed as Preferred Stock. All or any part of such
authorized Common Stock and Preferred Stock may be issued by the Corporation
from time to time and for such consideration as may be determined upon and
fixed by the Board of Directors as provided by law. [Amendment dated 5/19/94]
No holders of shares of Common Stock or Preferred Stock of the
Corporation shall be entitled, as such, as a matter of preemptive or
preferential right, to subscribe for or purchase any part of any new or
additional issue of shares of Common Stock or Preferred Stock, or any
treasury shares of Common Stock or Preferred Stock, or of securities of the
Corporation or of any subsidiary of the Corporation convertible into or
exchangeable for, or carrying rights or options to purchase or subscribe to,
or both, shares of any class whatsoever, whether now or hereafter autho-
rized, and whether issued for cash, property, services or otherwise.
The Board of Directors of the Corporation is, pursuant to the New
Jersey Business Corporation Law (N.J.S.A. 14A:7-2), authorized to amend
this Restated Certificate of Incorporation of the Corporation so as (a) to
divide the authorized shares of Preferred Stock of the Corporation into
series within such class, (b) to determine the designation and the number of
shares of any such series, and (c) to determine the relative voting,
dividend, conversion, redemption, liquidation and other rights, preferences
and limitations of the authorized shares of Preferred Stock of the Corpora-
tion.
[Series R added by Amendment dated 8/25/89, filed 8/28/89]
A. Creation of Preferred Stock, Series R. A series of Preferred
Stock of the Corporation, consisting of 600,000 Shares, is hereby created
and designated as "Series R Preferred Stock" (the "Series R Preferred
Stock") which series of Preferred Stock shall have a stated value of $100
per share and the following rights and preferences: [Amendment dated
8/20/93]
(a) Dividends and Distributions.
(1) Subject to the provisions for adjustment hereinafter
set forth, the holders of shares of Series R Preferred Stock
shall be entitled to receive, when, as and if declared by the
Board of Directors out of funds legally available for the
purpose, (i) cash dividends in an amount per share (rounded to
the nearest cent) equal to one hundred (100) times the aggregate
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<PAGE>
per share amount of all cash dividends declared or paid on the
Common Shares, $1.20 par value per share, of the Corporation
(the "Common Shares"), and (ii) a preferential cash dividend
(the "Preferential Dividends"), if any, on the first business
day of February, May, August and November of each year (each a
"Quarterly Dividend Payment Date"), commencing on the first
Quarterly Dividend Payment Date after the first issuance of a
share or fraction of a share of Series R Preferred Stock in an
amount equal to $1.00 per share of Series R Preferred Stock
reduced (but not to an amount less than zero) by the per share
amount of all cash dividends declared on the Series R Preferred
Stock pursuant to clause(i) of this sentence since the
immediately preceding Quarterly Dividend Payment Date or, with
respect to the first Quarterly Dividend Payment Date, since the
first issuance of any share or fraction of a share of Series R
Preferred Stock. In the event the Corporation shall, at any
time after the issuance of any share or fraction of a share of
Series R Preferred Stock, make any distribution on the Common
Shares of the Corporation, whether by way of a dividend or a
reclassification of stock, a recapitalization, reorganization or
partial liquidation of the Corporation or otherwise, which is
payable in cash or any debt security, debt instrument, real or
personal property or any other property (other than cash
dividends subject to the immediately preceding sentence, a
distribution of Common Shares or other capital stock of the
Corporation or a distribution of rights or warrants to acquire
any such share, including any debt security convertible into or
exchangeable for any such share, at a price less than the Fair
Market Value (as hereinafter defined) of such share), then and
in each such event the Corporation shall simultaneously pay on
each then outstanding share of Series R Preferred Stock of the
Corporation a distribution, in like kind, of one hundred (100)
times such distribution paid on a Common Share (subject to the
provisions for adjustment hereinafter set forth). The dividends
and distributions on the Series R Preferred Stock to which
holders thereof are entitled pursuant to clause (i) of the first
sentence of this paragraph and pursuant to the second sentence
of this paragraph are hereinafter referred to as "Participating
Dividends" and the multiple of such cash and non-cash dividends
on the Common Shares applicable to the determination of the
Participating Dividends, which shall be one hundred (100)
initially but shall be adjusted from time to time as hereinafter
provided, is hereinafter referred to as the "Dividend Multiple".
In the event the Corporation shall at any time after August 28,
1989 declare or pay any dividend or make any distribution on
Common Shares payable in Common Shares or any class or series
thereof, or effect a subdivision or split or a combination,
consolidation or reverse split of the outstanding Common Shares
into a greater or lesser number of Common Shares, then in each
such case the Dividend Multiple thereafter applicable to the
determination of the amount of Participating Dividends which
holders of shares of Series R Preferred Stock shall be entitled
to receive shall be the Dividend Multiple applicable immediately
prior to such event multiplied by a fraction the numerator of
which is the number of Common Shares outstanding immediately
after such event and the denominator of which is the number of
Common Shares that were outstanding immediately prior to such
event.
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<PAGE>
(2) The Corporation shall declare each Participating
Dividend at the same time it declares any cash or non-cash
dividend or distribution on the Common Shares in respect of
which a Participating Dividend is required to be paid. No cash
or non-cash dividend or distribution on the Common Shares in
respect of which a Participating Dividend is required to be paid
shall be paid or set aside for payment on the Common Shares
unless a Participating Dividend in respect of such dividend or
distribution on the Common Shares shall be simultaneously paid,
or set aside for payment, on the Series R Preferred Stock.
(3) Preferential Dividends shall begin to accrue on
outstanding shares of Series R Preferred Stock commencing with
the Quarterly Dividend Payment Date next following the date of
issuance of any shares of Series R Preferred Stock and shall
accrue on and as of such date and each successive Quarterly
Dividend Payment Date thereafter. Accrued but unpaid
Preferential Dividends shall cumulate but shall not bear
interest. Preferential Dividends paid on the shares of Series R
Preferred Stock in an amount less than the total amount of such
dividends at the time accrued and payable on such shares shall
be allocated pro rata on a share-by-share basis among all such
shares at the time outstanding.
b) Voting Rights. The holders of shares of Series R Preferred
Stock shall have the following voting rights:
(1) Subject to the provisions for adjustment hereinafter
set forth, each share of Series R Preferred Stock shall entitle
the holder thereof to one hundred (100) votes on all matters
submitted to a vote of the shareholders of the Corporation. The
number of votes which a holder of Series R Preferred Stock is
entitled to cast, as the same may be adjusted from time to time
as hereinafter provided, is hereinafter referred to as the "Vote
Multiple." In the event the Corporation shall at any time after
August 28, 1989 declare or pay any dividend on Common Stock
payable in Common Shares, or effect a subdivision or split or a
combination, consolidation or reverse split of the outstanding
Common Shares into a greater or lesser number of Common Shares,
then in each such case the Vote Multiple thereafter applicable
to the determination of the number of votes per share to which
holders of shares of Series R Preferred Stock shall be entitled
after such event shall be the Vote Multiple immediately prior to
such event multiplied by a fraction the numerator of which is
the number of Common Shares outstanding immediately after such
event and the denominator of which is the number of Common
Shares that were outstanding immediately prior to such event.
(2) Except as otherwise provided herein, or by law, the
Certificate of Incorporation or the By-laws, the holders of
shares of Series R Preferred Stock and the holders of Common
Shares shall vote together as one class on all matters submitted
to a vote of shareholders of the Corporation.
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<PAGE>
(3) If at the time of any annual meeting of shareholders of
the Corporation for the election of directors, the Corporation
shall have failed to pay the Preferential Dividends on the
shares of the Series R Preferred Stock for six dividend payment
periods, whether or not consecutive, or shall fail to pay in
full such dividends, if any, as may accumulate on any other
series of Preferred Stock for a period of 18 months (referred to
herein as a "Dividend Payment Default"), the number of directors
of the Corporation shall be increased by two and the holders of
the all outstanding series of Preferred Stock in respect of
which such a default in payment of dividends as described
hereinabove exists, voting as a single class without regard to
series, will be entitled to elect such additional two directors
until fullcumulative dividends for all past dividend periods
upon all series of Preferred Stock have been paid or declared
and set apart for payment. If and when the full cumulative
dividends on all series of Preferred Stock for all past dividend
payment periods shall have been paid or declared and set apart
for payment, the holders of Preferred Stock shall be divested of
the foregoing special voting right, subject to revesting in the
event of each and every subsequent Dividend Payment Default.
Upon the termination of each such special voting right, the term
of office of each director elected by the holders of shares of
Preferred Stock in respect of which a default exists in the
payment of dividends as described hereinabove (herein referred
to as a "Preferred Director") pursuant to such special voting
right shall forthwith terminate and the number of directors
constituting the Board of Directors shall be reduced by two.
Any Preferred Director may be removed by, and shall not be
removed except by, the vote of the holders of record of the
outstanding shares of Preferred Stock in respect of which such a
default exists, voting together as a single class without regard
to series, at a meeting of the shareholders, or of the holders
of shares of such Preferred Stock, called for the purpose. As
long as a Dividend Payment Default shall continue (A) any
vacancy in the office of a Preferred Director may be filled
(except as provided in the following clause (B)) by an
instrument in writing signed by the remaining Preferred Director
and filed with the Corporation and (B) in the case of the
removal of any Preferred Director, the vacancy may be filled by
the vote of the holders of the outstanding shares of Preferred
Stock in respect of which such a default exists, voting together
as a single class without regard to series, at the same meeting
at which such removal shall be voted or a subsequent meeting.
Each director appointed as aforesaid by the remaining Preferred
Director shall be deemed, for all purposes hereof, to be a
Preferred Director.
(4) Except as otherwise set forth herein or required by
law, the Certificate of Incorporation or the By-laws, holders of
Series R Preferred Stock shall have no special voting rights and
their consent shall not be required (except to the extent they
are entitled to vote with holders of Common Shares as set forth
herein) for the taking of any corporate action.
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<PAGE>
(c) Certain Restrictions.
(1) Whenever Preferential Dividends or Participating
Dividends are in arrears or the Corporation shall be in default
of payment thereof, thereafter and until all accrued and unpaid
Preferential Dividends and Participating Dividends, whether or
not declared, on shares of Series R Preferred Stock outstanding
shall have been paid or declared and a sum sufficient for the
payment thereof set apart for payment, and in addition to any
and all other rights which any holder of shares of Series R
Preferred Stock may have in such circumstances, the Corporation
shall not:
(i) declare or pay or set apart for payment dividends
on, make any other distributions on, or redeem or purchase
or otherwise acquire for consideration, any shares of stock
ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series R Preferred Stock;
(ii) declare or pay or set apart for payment dividends
on or make any other distributions on any shares of stock
ranking on a parity as to dividends with the Series R
Preferred Stock, unless dividends are paid ratably on the
Series R Preferred Stock and all such parity stock on which
dividends are payable or in arrears in proportion to the
total amounts to which the holders of all such shares are
then entitled if the full dividends accrued thereon were to
be paid;
(iii) except as permitted by subparagraph (iv) of
this paragraph (c)(1), redeem or purchase or otherwise
acquire for consideration shares of any stock ranking on a
parity (either as to dividends or upon liquidation,
dissolution or winding up) with the Series R Preferred
Stock, provided that the Corporation may at any time redeem,
purchase or otherwise acquire shares of any such parity
stock in exchange for shares of any stock of the Corporation
ranking junior (both as to dividends and upon liquidation,
dissolution or winding up) to the Series R Preferred
Stock; or
(iv) purchase or otherwise acquire for consideration
any shares of Series R Preferred Stock, or any shares of
stock ranking on a parity with the Series R Preferred Stock
(either as to dividends or upon liquidation, dissolution or
winding up), except in accordance with a purchase offer made
to all holders of such shares upon such terms as the Board
of Directors, after consideration of the respective annual
dividend rates and other relative rights and preferences of
the respective series and classes, shall determine in good
faith will result in fair and equitable treatment among the
respective series or classes.
(2) The Corporation shall not permit any Subsidiary (as
hereinafter defined) of the Corporation to purchase or otherwise
acquire for consideration any shares of stock of the Corporation
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<PAGE>
unless the Corporation could, under paragraph (1) of this
Section (c), purchase or otherwise acquire such shares at such
time and in such manner. A "Subsidiary" of the Corporation
shall mean any corporation or other entity of which securities
or other ownership interests having ordinary voting power
sufficient to elect a majority of the board of directors or
other persons performing similar functions are beneficially
owned, directly or indirectly, by the Corporation or by any
corporation or other entity that is otherwise controlled by the
Corporation.
(3) The Corporation shall not issue any shares of Series R
Preferred Stock except upon exercise of rights issued pursuant
to that certain Rights Agreement dated as of August 16, 1989
between the Corporation and First Chicago Trust Company of New
York, as Rights Agent, a copy of which is on file with the
Secretary of the Corporation at its principal executive office
and shall be made available to shareholders of record without
charge upon written request therefor addressed to said Secre-
tary. Notwithstanding the foregoing sentence, nothing contained
in the provisions hereof shall prohibit or restrict the
Corporation from issuing for any purpose any series of Preferred
Stock with rights and privileges similar to, different from, or
greater than, those of the Series R Preferred Stock.
(d) Reacquired Shares. Any shares of Series R Preferred Stock
purchased or otherwise acquired by the Corporation in any manner
whatsoever shall be retired and cancelled promptly after the
acquisition thereof. All such shares upon their retirement and
cancellation shall become authorized but unissued shares of Preferred
Stock, without designation as to series, and such shares may be
reissued as part of a new series of Preferred Stock to be created by
resolution or resolutions of the Board of Directors.
(e) Liquidation, Dissolution or Winding Up. Upon the
dissolution, liquidation or winding up of the Corporation, no
distribution shall be made (i) to the holders of shares of stock
ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series R Preferred Stock unless the
holders of shares of Series R Preferred Stock shall have received,
subject to adjustment as hereinafter provided, (1) $1.00 per
one-hundredth share ($100 per share) plus an amount equal to accrued
and unpaid dividends and distributions thereon, whether or not
declared, to the date of such payment, or (2) if greater than the
amount specified in clause (i)(1) of this sentence, an amount equal
to one hundred (100) times the aggregate amount to be distributed per
share to holders of Common Shares, as the same may be adjusted as
hereinafter provided, and (ii) to the holders of stock ranking on a
parity upon liquidation, dissolution or winding up with the Series R
Preferred Stock, unless simultaneously therewith distributions are
made ratably on the Series R Preferred Stock and all other shares of
such parity stock in proportion to the total amounts to which the
holders of shares of Series R Preferred Stock are entitled under
clause (i)(1) of this sentence and to which the holders of such
parity shares are entitled, in each case upon such liquidation,
dissolution or winding up. The amount to which holders of Series R
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<PAGE>
Preferred Stock may be entitled upon liquidation, dissolution or
winding up of the Corporation pursuant to clause (i)(2) of the
foregoing sentence is hereinafter referred to as the "Participating
Liquidation Amount" and the multiple of the amount to be distributed
to holders of Common Shares upon the liquidation, dissolution or
winding up of the Corporation applicable, pursuant to said clause, to
the determination of the Participating Liquidation Amount, as said
multiple may be adjusted from time to time as hereinafter provided,
is hereinafter referred to as the "Liquidation Multiple". In the
event the Corporation shall at any time after August 28, 1989 declare
or pay any dividend on Common Shares payable in Common Shares or any
class or series thereof, or effect a subdivision or split or a
combination, consolidation or reverse split of the outstandingCommon
Shares into a greater or lesser number of Common Shares, then in each
such case the Liquidation Multiple thereafter applicable to the
determination of the Participating Liquidation Amount to which
holders of Series R Preferred Stock shall be entitled after such
event shall be the Liquidation Multiple applicable immediately prior
to such event multiplied by a fraction the numerator of which is the
number of Common Shares outstanding immediately after such event and
the denominator of which is the number of Common Shares that were
outstanding immediately prior to such event. The sale, conveyance,
exchange or transfer (for cash, shares of stock, securities or other
consideration) of all or substantially all the property and assets of
the Corporation shall not be deemed a dissolution, liquidation or
winding up of the Corporation for the purposes of this Section (e),
nor shall the merger or consolidation of the Corporation into or with
any other corporation or association or the merger or consolidation
of any other corporation or association into or with the Corporation,
be deemed to be a dissolution, liquidation or winding up of the
Corporation for the purposes of this Section (e).
(f) Certain Reclassifications and Other Events.
(1) In the event that holders of Common Shares of the
Corporation receive after August 28, 1989 in respect of their
Common Shares any share of capital stock of the Corporation
(other than any Common Shares of the Corporation of the same
class and series as such outstanding Common Shares), whether by
way of reclassification, recapitalization, reorganization,
dividend or other distribution or otherwise (a "Transaction"),
then and in each such event the dividend rights, voting rights
and rights upon the liquidation, dissolution or winding up of
the Corporation of the shares of Series R Preferred Stock shall
be adjusted so that after such event the holders of Series R
Preferred Stock shall be entitled, in respect of each share of
Series R Preferred Stock held, in addition to such rights in
respect thereof to which such holder was entitled immediately
prior to such adjustment, to (i) such additional dividends as
equal the Dividend Multiple in effect immediately prior to such
Transaction multiplied by the additional dividends which the
holder of a Common Share shall be entitled to receive by virtue
of the receipt in the Transaction of such capital stock; (ii)
such additional voting rights as equal the Vote Multiple in
effect immediately prior to such Transaction multiplied by the
additional voting rights which the holder of a Common Share
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<PAGE>
shall be entitled to receive by virtue of the receipt in the
Transaction of such capital stock; and (iii) such additional
distributions upon liquidation, dissolution or winding up of the
Corporation as equal the Liquidation Multiple in effect
immediately prior to such Transaction multiplied by the
additional amount which the holder of a Common Share shall be
entitled to receive upon liquidation, dissolution or winding up
of the Corporation by virtue of the receipt in the Transaction
of such capital stock, as the case may be, all as provided by
the terms of such capital stock.
(2) In the event that all holders of Common Shares of the
Corporation receive after August 28, 1989 in respect of their
Common Shares any right or warrant to purchase Common Shares
(including as such a right, for all purposes of this paragraph,
any securityconvertible into or exchangeable for Common Shares)
at a purchase price per share less than the Fair Market Value of
a Common Share on the date of issuance of such right or warrant,
then and in each such event the dividend rights, voting rights
and rights upon the liquidation, dissolution or winding up of
the Corporation of the shares of Series R Preferred Stock shall
each be adjusted so that after such event the Dividend Multiple,
the Vote Multiple and the Liquidation Multiple shall each be the
product of the Dividend Multiple, the Vote Multiple and the
Liquidation Multiple, as the case may be, in effect immediately
prior to such event multiplied by a fraction the numerator of
which shall be the number of Common Shares outstanding
immediately before such issuance of rights or warrants plus the
maximum number of Common Shares which could be acquired upon
exercise in full of all such rights or warrants and the
denominator of which shall be the number of Common Shares
outstanding immediately before such issuance of rights or
warrants plus the number of Common Shares which could be
purchased, at the Fair Market Value of the Common Shares at the
time of such issuance, by the maximum aggregate consideration
payable upon exercise in full of all such rights or warrants.
(3) In the event that holders of Common Shares of the
Corporation receive after August 28, 1989 in respect of their
Common Shares any right or warrant to purchase capital stock of
the Corporation (other than Common Shares of any class or
series), including as such a right, for all purposes of this
paragraph, any security convertible into or exchangeable for
capital stock of the Corporation (other than Common Shares of
any class or series), at a purchase price per share less than
the Fair Market Value of such shares of capital stock on the
date of issuance of such right or warrant, then and in each such
event the dividend rights, voting rights and rights upon
liquidation, dissolution or winding up of the Corporation of the
shares of Series R Preferred Stock shall each be adjusted so
that after such event each holder of a share of Series R
Preferred Stock shall be entitled, in respect of each share of
Series R Preferred Stock held, in addition to such rights in
respect thereof to which such holder was entitled immediately
prior to such event, to receive (i) such additional dividends as
equal the Dividend Multiple in effect immediately prior to such
event multiplied, first, by the additional dividends to which
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<PAGE>
the holder of a Common Share shall be entitled upon exercise of
such right or warrant by virtue of the capital stock which could
be acquired upon such exercise and multiplied again by the
Discount Fraction (as hereinafter defined); (ii) such additional
voting rights as equal the Vote Multiple in effect immediately
prior to such event multiplied, first, by the additional voting
rights to which the holder of a Common Share shall be entitled
upon exercise of such right or warrant by virtue of the capital
stock which could be acquired upon such exercise and multiplied
again by the Discount Fraction; and (iii) such additional
distributions upon liquidation, dissolution or winding up of the
Corporation as equal the Liquidation Multiple in effect
immediately prior to such event multiplied, first, by the
additional amount which the holder of a Common Share shall be
entitled to receive upon liquidation, dissolution or winding up
of the Corporation uponexercise of such right or warrant by
virtue of the capital stock which could be acquired upon such
exercise and multiplied again by the Discount Fraction. For
purposes of this paragraph, the "Discount Fraction" shall be a
fraction the numerator of which shall be the difference between
the Fair Market Value of a share of the capital stock subject to
a right or warrant distributed to holders of Common Shares of
the Corporation as contemplated by this paragraph immediately
after the distribution thereof and the purchase price per share
for such share of capital stock pursuant to such right or
warrant and the denominator of which shall be the Fair Market
Value of a share of such capital stock immediately after the
distribution of such right or warrant.
(4) For purposes hereof, the "Fair Market Value" of a share
of capital stock of the Corporation (including a Common Share)
on any date shall be deemed to be the average of the daily
closing price per share thereof over the 30 consecutive Trading
Days (as such term is hereinafter defined) immediately prior to
such date; provided, however, that, in the event that such Fair
Market Value of any such share of capital stock is determined
during a period which includes any date that is within 30
Trading Days after (i) the ex-dividend date for a dividend or
distribution on stock payable in shares of such stock or
securities convertible into shares of such stock, or (ii) the
effective date of any subdivision, split, combination,
consolidation, reverse stock split or reclassification of such
stock, then, and in each such case, the Fair Market Value shall
be appropriately adjusted by the Board of Directors of the
Corporation to take into account ex-dividend or post-effective
date trading. The closing price for any day shall be the last
sale price, regular way, or, in case no such sale takes place on
such day, the average of the closing bid and asked prices,
regular way (in either case, as reported in the applicable
transaction reporting system with respect to securities listed
or admitted to trading on the New York Stock Exchange), or, if
the shares are not listed or admitted to trading on the New York
Stock Exchange, as reported in the applicable transaction
reporting system with respect to securities listed on the
principal national securities exchange on which the shares are
listed or admitted to trading or, if the shares are not listed
or admitted to trading on any national securities exchange, the
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<PAGE>
last quoted price or, if not so quoted, the average of the high
bid and low asked prices in the over-the-counter market, as
reported by the National Association of Securities Dealers, Inc.
Automated Quotation System ("NASDAQ") or such other system then
in use, or if on any such date the shares are not quoted by any
such organization, the average of the closing bid and asked
prices as furnished by a professional market maker making a
market in the shares selected by the Board of Directors of the
Corporation. The term "Trading Day" shall mean a day on which
the principal national securities exchange on which the shares
are listed or admitted to trading is open for the transaction of
business or, if the shares are not listed or admitted to trading
on any national securities exchange, on which the New York Stock
Exchange or such other national securities exchange as may be
selected by the Board of Directors of the Corporation is open.
If the shares are not publicly held or not so listed or traded
on any day within the period of 30 Trading Daysapplicable to the
determination of Fair Market Value thereof as aforesaid, "Fair
Market Value" shall mean the fair market value thereof per share
as determined in good faith by the Board of Directors of the
Corporation. In either case referred to in the foregoing
sentence, the determination of Fair Market Value shall be
described in a statement filed with the Secretary of the
Corporation.
(g) Consolidation, Merger, etc. In case the Corporation shall
enter into any consolidation, merger, combination or other
transaction in which the Common Shares are exchanged for or changed
into other stock or securities, cash and/or any other property, then
in any such case each outstanding share of Series R Preferred Stock
shall at the same time be similarly exchanged for or changed into the
aggregate amount of stock, securities, cash and/or other property
(payable in like kind), as the case may be, for which or into which
each Common Share is changed or exchanged multiplied by the highest
of the Dividend Multiple, the Vote Multiple or the Liquidation
Multiple in effect immediately prior to such event.
(h) Effective Time of Adjustments.
(1) Adjustments to the Series R Preferred Stock required by
the provisions hereof shall be effective as of the time at which
the event requiring such adjustments occurs.
(2) The Corporation shall give prompt written notice to
each holder of a share of Series R Preferred Stock of the effect
of any adjustment to the voting rights, dividend rights or
rights upon liquidation, dissolution or winding up of the
Corporation of such shares required by the provisions hereof.
Notwithstanding the foregoing sentence, the failure of the Cor-
poration to give such notice shall not affect the validity of
or the force or effect of or the requirement for such adjustment.
(i) No Redemption. The shares of Series R Preferred Stock shall
not be redeemable at the option of the Corporation or any holder
thereof. Notwithstanding the foregoing sentence of this Section, the
Corporation may acquire shares of Series R Preferred Stock in any
other manner permitted by law, the provisions hereof and the
Certificate of Incorporation of the Corporation.
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<PAGE>
(j) Ranking. Unless otherwise provided in the Certificate of
Incorporation of the Corporation or a Certificate of Amendment
relating to a subsequent series of preferred stock of the
Corporation, the Series R Preferred Stock shall rank junior to all
other series of the Corporation's Preferred Stock as to the payment
of dividends and the distribution of assets on liquidation,
dissolution or winding up and senior to the Common Shares.
(k) Conversion or Exchange. The holders of shares of Series R
Preferred Stock shall not have any rights to convert such shares into
or exchange such shares for Common Shares of the Corporation or any
other stock of the Corporation.
(l) Preemptive Rights. Shares of the Series R Preferred Stock
are not entitled to any preemptive rights.
(m) Amendment. Unless the vote or consent of the holders of a
greater number of shares shall then be required by law, the consent
of the holders of at least 66-2/3% of all of the shares of this
Series R Preferred Stock at the time outstanding given in person or
by proxy, either in writing or by a vote at a meeting called for the
purpose, on which matter the holders of shares of this Series R
Preferred Stock shall vote together as a separate class, shall be
necessary to authorize, effect or validate any amendment, alteration
or repeal of any of the provisions of the Restated Certificate of
Incorporation of the Corporation or of any certificate amendatory or
supplemental thereto which amendment, alteration or repeal would, if
effected, adversely affect the preferences, rights, powers or
privileges of this Series R Preferred Stock.
B. Creation of Adjustable Rate Cumulative Preferred Stock, Series
B. A series of Preferred Stock of the Corporation, consisting of
1,200,000 shares, is hereby created and designated as `Adjustable Rate
Cumulative Preferred Stock, Series B' hereinafter referred to as `this
Series B'), which series of Preferred Stock shall have a stated value of
$50 per share and the following rights and preferences:
(a) Dividends.
(1) Dividends shall accrue daily on the shares of this
Series B for each dividend payment period at the following
rates: (i) for the dividend payment period from the date of
their original issuance to and including July 31, 1987 at the
rate of 7.25% per annum, and (ii) for each quarterly dividend
payment period thereafter, commencing on August 1, November 1,
February 1 or May 1, as the case may be, of each year and ending
on and including the day next preceding the first day of the
next such quarterly dividend payment period (a `Quarterly
Dividend Period'), at the Applicable Rate (as defined in
paragraph (2) of this Section (a)) from time to time in effect
for each such Quarterly Dividend Period. Such dividends,
calculated as a percentage of stated value, shall accrue from
the date of original issuance of such shares, shall be payable
in arrears, when, as and if declared by the Board of Directors,
on the first day of February, May, August and November of each
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<PAGE>
year, commencing August 1, 1987 and shall cumulate if not paid
on such payment date. Each such dividend shall be paid to the
holders of record of shares of this Series B as they appear on
the books of the Corporation on such record dates, not exceeding
30 days preceding the payment dates thereof, as shall be fixed
by the Board of Directors of the Corporation or by a duly
authorized committee thereof.
(2) Except as provided below in this paragraph, the `Appli-
cable Rate' for any Quarterly Dividend Period shall be 1.50%
less than the highest of the Treasury Bill Rate, the Ten Year
Constant Maturity Rate and the Thirty Year Constant Maturity
Rate (each as hereinafter defined) as determined in advance for
such Quarterly Dividend Period. In the event that the
Corporation determines in good faith that forany reason one or
more of such rates cannot be determined for any Quarterly
Dividend Period, then the Applicable Rate for such Quarterly
Dividend Period shall be 1.50% less than the higher of whichever
of such rates can be so determined. In the event that the
Corporation determines in good faith that none of such rates can
be determined for any Quarterly Dividend Period, then the
Applicable Rate in effect for the preceding dividend payment
period shall continue for such Quarterly Dividend Period.
Notwithstanding the foregoing, the Applicable Rate for any
Quarterly Dividend Period shall in no event be less than 6% per
annum nor greater than 11% per annum.
(3) Except as provided below in this paragraph, the `Trea-
sury Bill Rate' for each Quarterly Dividend Period shall be the
arithmetic average of the two most recent weekly per annum
market discount rates for three-month U.S. Treasury bills, as
published weekly by the Board of Governors of the Federal
Reserve System (the `Federal Reserve Board') during the period
of fourteen calendar days (a `Calendar Period') immediately
prior to the last ten calendar days of January, April, July or
October, as the case may be, prior to the commencement of the
Quarterly Dividend Period for which the dividend rate on this
Series B is being determined (or the one weekly per annum market
discount rate, if only one such rate shall be so published
during such Calendar Period). In the event that the Federal
Reserve Board does not publish such a weekly per annum market
discount rate during such Calendar Period, then the Treasury
Bill Rate for such Quarterly Dividend Period shall be the
arithmetic average of the two most recent weekly per annum
market discount rates for three-month U.S. Treasury bills as
published weekly during such Calendar Period by any Federal
Reserve Bank or by any U.S. Government department or agency
selected by the Corporation (or the one weekly per annum market
discount rate, if only one such rate shall be so published
during such Calendar Period). In the event that a per annum
market discount rate for three-month U.S. Treasury bills shall
not be published by the Federal Reserve Board or by any Federal
Reserve Bank or by any U.S. Government department or agency
during such Calendar Period, then the Treasury Bill Rate for
such Quarterly Dividend Period shall be the arithmetic average
of the two most recent weekly per annum market discount rates
for all of the U.S. Treasury bills then having maturities of not
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<PAGE>
less than 80 nor more than 100 days, as published during such
Calendar Period by the Federal Reserve Board or, if the Federal
Reserve Board shall not publish such rates, by any Federal
Reserve Bank or by any U.S. Government department or agency
selected by the Corporation (or the one weekly per annum market
discount rate, if only one such rate shall be so published
during such Calendar Period). In the event that the Corporation
determines in good faith that for any reason no such U.S.
Treasury bill rates were published as provided above during such
Calendar Period, then the Treasury Bill Rate for such Quarterly
Dividend Period shall be the arithmetic average of the per annum
market discount rates based upon the closing bids during such
Calendar Period for each of the issues of marketable
non-interest bearing U.S. Treasury securities with a maturity of
not less than 80 nor more than 100 days from the date of each
such quotation, as chosen and quoted daily for each business
day in New York City (or less frequently if daily quotations
shall not be generally available) to the Corporationby at least
three recognized dealers in the U.S. Government securities
selected by the Corporation. In the event that the Corporation
determines in good faith that for any reason the Corporation
cannot determine the Treasury Bill Rate for any Quarterly
Dividend Period as provided above in this paragraph, the
Treasury Bill Rate for such dividend period shall be the
arithmetic average of the per annum market discount rates based
upon the closing bids during such Calendar Period for each of
the issues of marketable interest-bearing U.S. Treasury
securities with a maturity of not less than 80 nor more than 100
days (from the date of such quotation), as chosen and quoted
daily for each business day in New York City (or less frequently
if daily quotations shall not be generally available) to the
Corporation by at least three recognized dealers in U.S. Govern-
ment securities selected by the Corporation.
(4) Except as provided below in this paragraph, the `Ten
Year Constant Maturity Rate' for each Quarterly Dividend Period
shall be the arithmetic average of the two most recent weekly
per annum Ten Year Average Yields (as hereinafter defined), as
published weekly by the Federal Reserve Board during the
Calendar Period immediately prior to the last ten calendar days
of January, April, July or October, as the case may be, prior to
the commencement of the Quarterly Dividend Period for which the
dividend rate on this Series B is being determined (or the one
weekly per annum Ten Year Average Yield, if only one such Yield
shall be so published during such Calendar Period). In the
event that the Federal Reserve Board does not publish such a
weekly per annum Ten Year Average Yield during such Calendar
Period, then the Ten Year Constant Maturity Rate for such
Quarterly Dividend Period shall be the arithmetic average of the
two most recent weekly per annum Ten Year Average Yields, as pub-
lished weekly during such Calendar Period by any Federal Reserve
Bank or by any U.S. Government department or agency selected by
the Corporation (or the one weekly per annum Ten Year Average
Yield, if only one such Yield shall be so published during such
Calendar Period). In the event that a per annum Ten Year
Average Yield shall not be published by the Federal Reserve
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<PAGE>
Board or by any Federal Reserve Bank or by any U.S. Government
department or agency during such Calendar Period, then the Ten
Year Constant Maturity Rate for such dividend period shall be
the arithmetic average of the two most recent weekly per annum
average yields to maturity for all of the actively traded
marketable U.S. Treasury fixed interest rate securities (other
than Special Securities) then having maturities of not less than
eight nor more than twelve years, as published during such
Calendar Period by the Federal Reserve Board or, if the Federal
Reserve Board shall not publish such yields, by any Federal
Reserve Bank or by any U.S. Government department or agency
selected by the Corporation (or the one weekly per annum average
yield to maturity, if only one such yield shall be so published
during such Calendar Period). In the event that the Corporation
determines in good faith that for any reason the Corporation
cannot determine the Ten Year Constant Maturity Rate for any
Quarterly Dividend Period as provided above in this paragraph,
then the Ten Year Constant Maturity Rate for such dividend
period shall be the arithmetic average of the per annum average
yields to maturity based upon the closing bids during such
Calendar Period foreach of the issues of actively traded
marketable U.S. Treasury fixed interest rate securities (other
than Special Securities) with a final maturity date not less
than eight nor more than twelve years from the date of each such
quotation, as chosen and quoted daily for each business day in
New York City (or less frequently if daily quotations shall not
be generally available) to the Corporation by at least three
recognized dealers in U.S. Government securities selected by the
Corporation.
(5) Except as provided below in this paragraph, the `Thirty
Year Constant Maturity Rate' for each Quarterly Dividend Period
shall be the arithmetic average of the two most recent weekly
per annum Thirty Year Average Yields (as hereinafter defined),
as published weekly by the Federal Reserve Board during the
Calendar Period immediately prior to the last ten calendar days
of January, April, July or October, as the case may be, prior to
the Quarterly Dividend Period for which the dividend rate on
this Series B is being determined (or the one weekly per annum
Thirty Year Average Yield, if only one such Yield shall be so
published during such Calendar Period). In the event that the
Federal Reserve Board does not publish such a weekly per annum
Thirty Year Average Yield during such Calendar Period, then the
Thirty Year Constant Maturity Rate for such Quarterly Dividend
Period shall be the arithmetic average of the two most recent
weekly per annum Thirty Year Average Yields, as published weekly
during such Calendar Period by any Federal Reserve Bank or by
and U.S. Government department or agency selected by the
Corporation (or the one weekly per annum Thirty Year Average
yield, if only one such yield shall be so published during such
Calendar Period). In the event that a per annum Thirty Year
Average Yield shall not be published by the Federal Reserve
Board or by any Federal Reserve Bank or by any U.S. Government
department or agency during such Calendar Period, then the
Thirty Year Constant Maturity Rate for such Quarterly Dividend
Period shall be the arithmetic average of the two most recent
weekly per annum average yields to maturity for all of the
actively traded marketable U.S. Treasury fixed interest rate
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<PAGE>
securities (other than Special Securities) then having
maturities of not less than twenty-eight nor more than thirty
years, as published during such Calendar Period by the Federal
Reserve Board or, if the Federal Reserve Board shall not publish
such yields, by any Federal Reserve Bank or by any U.S.
Government department or agency selected by the Corporation (or
the one weekly per annum average yield to maturity, if only one
such yield shall be so published during such Calendar Period).
In the event that the Corporation determines in good faith
that for any reason the Corporation cannot determine the Thirty
Year Constant Maturity Rate for any Quarterly Dividend Period as
provided above in this paragraph, then the Thirty Year Constant
Maturity Rate for such Quarterly Dividend Period shall be the
arithmetic average of the per annum average yields to maturity
based upon the closing bids during such Calendar Period for each
of the issues of actively traded marketable U.S. Treasury fixed
interest rate securities (other than Special Securities) with a
final maturity date not less than twenty-eight nor more than
thirty years from the date of each such quotation, as chosen and
quoted daily for each business day in New York City (or less
frequently if daily quotations shall not begenerally available)
to the Corporation by at least three recognized dealers in U.S.
Government securities selected by the Corporation.
(6) The Treasury Bill Rate, the Ten Year Constant Matu-
rity Rate and the Thirty Year Constant Maturity Rate shall each
be rounded to the nearest five hundredths of a percentage point.
(7) The amount of dividends per share payable for each
dividend period shall be computed by dividing the Applicable
Rate for such dividend period by four and applying such rate
against the $50 stated value per share of the shares of this
Series B, rounding to the nearest cent. The amount of dividends
payable for the dividend payment period from the date of
original issue to and including July 31, 1987 or any period
shorter than a full dividend payment period shall be computed on
the basis of 30-day months, a 360-day year and the actual number
of days elapsed in the period.
(8) The Applicable Rate with respect to each Quarterly
Dividend Period will be calculated as promptly as practicable by
the Corporation according to the appropriate method described
herein. The mathematical accuracy of each such calculation
will be confirmed in writing by independent accountants of
recognized standing. The Corporation will cause notice of the
Applicable Rate for the then current Quarterly Dividend Period
to be mailed to holders of shares of this Series B with the
dividend payment checks for the preceding Quarterly Dividend
Period, or, if such notice is not practicable, will cause notice
of the Applicable Rate to be published as soon thereafter as
practicable in a newspaper of general circulation in New York
City.
(9) For purposes of this Section (a), the term
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(i) `Special Securities' shall mean securities
which can, at the option of the holder, be surrendered at
face value in payment of any federal estate tax or which
provide tax benefits to the holder and are priced to reflect
such tax benefits or which were originally issued at a deep
or substantial discount;
(ii) `Ten Year Average Yield' shall mean the average
yield to maturity for actively traded marketable U.S.
Treasury fixed interest rate securities (adjusted to
constant maturities of ten years); and
(iii) `Thirty Year Average Yield' shall mean the av-
erage yield to maturity for actively traded marketable U.S.
Treasury fixed interest rate securities (adjusted to
constant maturities of 30 years).
(10) No dividends shall be declared or paid or set apart for
payment on any series of Preferred Stock or any class of capital
stock of the Corporation ranking, as to dividends, on a parity
with or junior to this Series B for any period unless full
cumulative dividends have been or contemporaneously are
declared and paid or declared and a sum sufficient for the
payment thereof set apart forpayment on this Series B for all
past dividend payment periods. When full cumulative dividends
for all past dividend periods are not paid or provided for, as
aforesaid, upon the shares of this Series B and any other series
of Preferred Stock and any other class of capital stock of the
Corporation ranking, as to dividends, on a parity with this
Series B (herein referred to as "Dividend Parity Stock"), all
dividends declared upon shares of this Series B and any other
Dividend Parity Stock shall be declared pro rata so that the
amount of dividends declared per share on this Series B and all
other Dividend Parity Stock shall in all cases bear to each
other the same ratio that accrued dividends per share on the
shares of this Series B and such other Dividend Parity Stock
bear to each other. Holders of shares of this Series B shall
not be entitled to any dividends, whether payable in cash,
property or stock, in excess of full cumulative dividends, as
herein provided, on this Series B. No interest or sum of money
in lieu of interest shall be payable in respect of any dividend
payment or payments on this Series B which may have accumulated
or be in arrears.
(11) So long as any shares of this Series B are outstand-
ing, no dividend, other than a dividend in Common Stock or in
any other stock of the Corporation ranking junior to this Series
B as to dividends and upon liquidation and other than as
provided in paragraph (10) of this Section (a), shall be
declared or paid or set aside for payment nor shall any other
distribution be declared or made upon the Common Stock or upon
any other stock of the Corporation ranking junior to or on a
parity with this Series B as to dividends or upon liquidation,
nor shall any Common Stock nor any other stock of the
Corporation ranking junior to or on a parity with this Series B
as to dividends or upon liquidation be redeemed, purchased or
otherwise acquired
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<PAGE>
for any consideration (or any moneys be paid to or made
available for a sinking fund for the redemption of any shares of
any such stock) by the Corporation or any subsidiary thereof
(except by conversion into or exchange for stock of the
Corporation ranking junior to this Series B as to dividends and
upon liquidation) unless, in each case, full cumulative
dividends on all outstanding shares of this Series B shall have
been paid for all past dividend payment periods.
(b) Redemption.
(1) The shares of this Series B shall not be redeemable
prior to May 1, 1992. On and after May 1, 1992, the
Corporation, at its option, may redeem shares of this Series B,
as a whole or in part, upon not less than 30 nor more than 60
days' notice by mail, at a redemption price (i) in the case of
redemption on or after May 1, 1992 and prior to May 1, 1995, of
$51.50 per share and (ii) in the case of a redemption occurring
on or after May 1, 1995, of $50 per share, plus, in each case,
all accrued and unpaid dividends thereon to the date fixed for
redemption.
(2) In the event that fewer than all the outstanding shares
of this Series B are to be redeemed as permitted by this Section
(b), the number of shares to be redeemed shall be determined by
the Board of Directors and the shares to be redeemed shall be
determined by lot orpro rata as may be determined by the Board
of Directors or by such other method as may be approved by the
Board of Directors to conform to any rule or regulation of any
stock exchange upon which the shares of this Series B may at the
time be listed.
(3) Notice of any redemption of shares of this Series B,
specifying the date fixed for redemption (herein referred to as
the "Redemption Date") and place of redemption, shall be given
by first class mail mailed to each holder of record of the
shares to be redeemed, at his address of record, not more than
60 nor less than 30 days prior to the Redemption Date; if less
than all the shares owned by such shareholder are then to be
redeemed, the notice shall also specify the number of shares
thereof which are to be redeemed.
(4) Notice of redemption of shares of this Series B having
been given as provided in paragraph (3) of this Section (b),
unless default be made in the payment in full of the redemption
price and all accrued and unpaid dividends to the Redemption
Date, dividends on the shares called for redemption shall cease
to accrue at the Redemption Date, and all rights of the holders
of such shares as shareholders of the Corporation by reason
of the ownership of such shares shall cease on the Redemption
Date, except the right to receive the amount payable upon
redemption of such shares, without interest thereon, on
presentation and surrender of the respective certificates
representing such shares, and such shares shall not after the
Redemption Date be deemed to be outstanding. In case fewer than
all the shares
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<PAGE>
represented by any such certificate are redeemed, a new
certificate shall be issued representing the unredeemed shares
without cost to the holder thereof.
(5) Any shares of this Series B which shall at any time
have been redeemed shall, after such redemption, have the status
of authorized but unissued shares of Preferred Stock, without
designation as to series until such shares are once more
designated as part of a particular series by the Board of
Directors.
(6) In the event that full cumulative dividends for all
past dividend payment periods on shares of this Series B have
not been paid, no shares of this Series B shall be redeemed
unless all outstanding shares of this Series B are
simultaneously redeemed, and neither the Corporation nor any
subsidiary thereof shall purchase or otherwise acquire any
shares of this Series B; provided, however, that the foregoing
shall not prevent the purchase or acquisition of shares of this
Series B pursuant to a purchase or exchange offer made on the
same terms to holders of all outstanding shares of this Series
B.
(7) Shares of this Series B are not subject or entitled to
the benefit of a sinking fund.
(c) Conversion or Exchange. The holders of shares of this
Series B shall not have any rights to convert such shares into or
exchange such shares for shares of Common Stock of the Corporation or
any other stock of the Corporation.
(d) Preemptive Rights. Shares of this Series B are not entitled
to any preemptive rights.
(e) Voting. Except as required by law, the shares of this
Series B shall not have any voting powers, either general or special,
except as provided in the following paragraphs (1) through (3):
(1) If at the time of any annual meeting of shareholders of
the Corporation for the election of directors, the
Corporation shall have failed to pay full cumulative dividends
on the shares of this Series B for six dividend payment periods,
whether or not consecutive, or shall fail to pay in full such
dividends, if any, as may accumulate on any other series of
Preferred Stock for a period of 18 months (referred to herein as
a "Dividend Payment Default"), the number of directors of the
Corporation shall be increased by two and the holders of all
outstanding series of Preferred Stock in respect of which such a
default in payment of dividends as described hereinabove exists,
voting as a single class without regard to series, will be
entitled to elect such additional two directors until full cumu-
lative dividends for all past dividend payment periods on all
series of Preferred Stock have been paid or declared and set
apart for payment. If and when full cumulative dividends upon
all series of Preferred Stock for all past dividend payment
periods shall have been paid or declared and set apart for
payment, the holders of Preferred Stock shall be divested of the
foregoing
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<PAGE>
special voting right, subject to revesting in the event of each
and every subsequent Dividend Payment Default. Upon the
termination of each such special voting right, the term of
office of each director elected by the holders of shares of
Preferred Stock in respect of which a default exists in the
payment of dividends as described hereinabove (herein referred
to as a `Preferred Director') pursuant to such special voting
right shall forthwith terminate and the number of directors
constituting the Board of Directors shall be reduced by two.
Any Preferred Director may be removed by, and shall not be
removed except by, the vote of the holders of record of the out-
standing shares of Preferred Stock in respect of which such a
default exists, voting together as a single class without regard
to series, at a meeting of the shareholders, or of the holders
of shares of such Preferred Stock, called for the purpose. So
long as a Dividend Payment Default shall continue (A) any
vacancy in the office of a Preferred Director may be filled
(except as provided in the following clause (B)) by an
instrument in writing signed by the remaining Preferred Director
and filed with the Corporation and (B) in the case of the
removal of any Preferred Director, the vacancy may be filled by
the vote of the holders of the outstanding shares of Preferred
Stock in respect of which such a default exists, voting
together as a single class without regard to series, at the same
meeting at which such removal shall be voted or a subsequent
meeting. Each director appointed as aforesaid by the remaining
Preferred Director shall be deemed, for all purposes hereof, to
be a Preferred Director.
(2) Unless the vote or consent of the holders of a greater
number of shares shall then be required by law, the consent of
the holders of at least 66-2/3% of all of the shares of this
Series B at the time outstanding given in person or by proxy,
either in writing or by a vote at a meeting called for the
purpose, on which matter the holders of shares of this Series B
shall vote together as a separate class, shall be necessary to
authorize, effect or validate any amendment, alteration or
repeal of any of the provisions of the Restated Certificate of
Incorporation of the Corporation or of any certificate
amendatory or supplemental thereto which amendment, alteration
or repeal would, if effected, adversely affect the preferences,
rights, powers or privileges of this Series B other than any
such amendment or alteration subject to paragraph (3) of this
Section (e).
(3) Unless the vote or consent of the holders of a greater
number of shares shall then be required by law, the consent of
the holders of at least a majority of all of the shares of this
Series B and all other series of Preferred Stock ranking on a
parity with this Series B either as to the dividends or upon
liquidation, at the time outstanding, given in person or by
proxy, either in writing or by a vote at a meeting called for
the purpose, on which matter the holders of shares of this
Series B and such other series of Preferred Stock shall vote
together as a single class without regard to series, shall be
necessary to issue, authorize or increase the authorized
amount of any class of capital stock of the Corporation or
series of
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<PAGE>
Preferred Stock ranking prior to the shares of this Series B as
to dividends or upon liquidation or the creation or
authorization of any obligation or security convertible into or
evidencing the right to purchase any such shares.
(f) Liquidation Rights.
(1) Upon the dissolution, liquidation or winding up of the
Corporation, the holders of the shares of this Series B shall
be entitled to receive out of the assets of the Corporation,
before any payment or distribution shall be made on the
Common Stock or on any other stock of the Corporation ranking
junior to this Series B upon liquidation, the amount of $50 per
share, plus a sum equal to all dividends accrued on such shares
(whether or not earned or declared) and unpaid to the date of
final distribution. The sale, conveyance, exchange or
transfer (for cash, shares of stock, securities or other
consideration) of all or substantially all the property and
assets of the Corporation shall not be deemed a dissolution, liq-
uidation or winding up of the Corporation for the purposes of
this Section (f), nor shall the merger or consolidation of the
Corporation into or with any other corporation or association or
the merger or consolidation of any other corporation or
association into or with the Corporation, be deemed to be a
dissolution, liquidation or winding up of the Corporation for
the purposes of this Section (f).
(2) After the payment in cash (in New York Clearing House
funds or its equivalent) to the holders of the shares of this
Series B of the full preferential amounts for the shares of this
Series B, the holders of this Series B as such shall have no
right or claim to any of the remaining assets of the Corporation.
(3) In the event the assets of the Corporation available
for distribution to the holders of shares of this Series B
upon any dissolution, liquidation or winding up of the
Corporation, whether voluntary or involuntary, shall be
insufficient to pay in full all amounts to which such holders
are entitled pursuant to paragraph (1) of this Section (f), no
distribution shall be made on account of any shares of any other
series of Preferred Stock or any other class of stock of the
Corporation ranking on a parity with the shares of this Series B
upon such dissolution, liquidation or winding up unless
proportionate amounts shall be paid on account of the shares of
this Series B, ratably, in proportion to the full amounts to
which holders of all such shares which are on a parity with the
shares of this Series B are respectively entitled upon such
dissolution, liquidation or winding up.
(4) Upon the dissolution, liquidation or winding up of the
Corporation, the holders of shares of this Series B then
outstanding shall be entitled to be paid out of the assets of
the Corporation available for distribution to its
shareholders all amounts to which such holders are entitled pur-
suant to paragraph (1) of this Section (f) before any payment
shall be
-22-
<PAGE>
made to the holders of any series of Preferred Stock or any
class of stock of the Corporation ranking junior to this
Series B upon liquidation.
(g) For purposes of this amendment, any stock of any series or
class of the Corporation shall be deemed to rank:
(1) prior to the shares of this Series B, as to dividends
or upon liquidation, if the holders of such series or class
shall be entitled to the receipt of dividends or of amounts
distributable upon dissolution, liquidation or winding up of the
Corporation, as the case may be, in preference or priority to
the holders of shares of this Series B;
(2) on a parity with shares of this Series B, as to
dividends or upon liquidation, whether or not the dividend
rates, dividend payment dates or redemption or liquidation
prices per share or sinking fund provisions, if any, be
different from those of this Series B, if the holders of such
stock shall be entitled to the receipt of dividends or of
amounts distributable upon the dissolution, liquidation or
winding up of the Corporation, as the case may be, in proportion
to their respective dividend rates or liquidation prices,
without preference or priority, one over the other, as between
the holders of such stock and the holders of shares of this
Series B; and
(3) junior to shares of this Series B, as to dividends or
upon liquidation, if such stock shall be Common Stock or if
the holders of shares of this Series B shall be entitled to
receipt of dividends or of amounts distributable upon
dissolution, liquidation or winding up of the Corporation, as
the case may be, in preference or priority to the holders of
shares of such series or class.
4. The location of the current registered office of the Corporation in
this State is 301 Carnegie Center, P. O. Box 2066, Princeton, New Jersey
08543-2066, and the name of the current agent therein and in charge thereof
upon whom process against this Corporation may be served is Richard F.
Ober, Jr.
5. The current Board of Directors consists of sixteen persons whose
names and addresses are as follows:
R. EDWARD J. BLOUSTEIN President, Rutgers,
The State University
of New Jersey
Old Queens Bldg.
Corner of George and
Somerset Streets
New Brunswick, NJ 08901
-23-
<PAGE>
KENNETH A. BOTT President
United Jersey Bank/
Franklin State
630 Franklin Boulevard
Somerset, NJ 08873
ROBERT L. BOYLE Publisher Emeritus
of the Dispatch
10 Club Way
Rumson, NJ 07760
JOHN G. COLLINS Vice Chairman
United Jersey Banks
301 Carnegie Center
P. O. Box 2066
Princeton, NJ 08543-2066
CLIFFORD H. COYMAN President
United Jersey Bank
210 Main Street
Hackensack, NJ 07602
WALTER J. DEALTREY Chairman
Service Tire Truck
Center Inc.
2320 Avenue A
Bethlehem, PA 18017
T. J. DERMOT DUNPHY President & CEO
Sealed Air Corporation
Park 80 Plaza East
Saddle Brook, NJ 07662
ELINOR J. FERDON Professional Volunteer
Litchfield Way
P. O. Box 255
Alpine, NJ 07620
FRED G. HARVEY Vice President
E. & E. Corp.
225 West 2nd Street
Bethlehem, PA 18015
JOHN F. HOFF III Senior Vice President
Director of Government
Banking & Relations
United Jersey Banks
150 West State Street
Trenton, NJ 08608
JOHN R. HOWELL Chairman
First Valley Corporation
One Bethlehem Plaza
Bethlehem, PA 18018
FRANCIS J. MERTZ President
Independent College Fund
of New Jersey
P. O. Box 269
Summit, NJ 07901
-24-
<PAGE>
HENRY S. PATTERSON II President
E'town Corporation
P. O. Box 788
Westfield, NJ 07091
T. JOSEPH SEMROD Chairman and President
United Jersey Banks
301 Carnegie Center
P. O. Box 2066
Princeton, NJ 08543-2066
JAMES A. SKIDMORE, JR. Chairman, President and
CEO
Science Management Corp.
P. O. Box 0600
Basking Ridge, NJ 07920
JOSEPH M. TABAK President
Bunzl Distribution USA,
Eastern Division
Edison Square West
Suite 1000
2035 Route 27
Edison, NJ 08817
The Board of Directors shall consist of not less than five (5)
persons and not more than forty (40) persons, as may be determined from time
to time in the discretion of the Board of Directors.
[paragraph deleted by Amendment dated May 15, 1990, filed May 16, 1990]
Except as otherwise provided by statute, by this Restated Certificate
of Incorporation as the same may be amended from time to time, or by By-Laws
as the same may be amended from time to time, all corporate powers may be
exercised by the Board of Directors. Without limiting the foregoing, the
Board of Directors shall have power, without shareholders' action:
A. To authorize and cause to be executed and/or issued mortgages,
liens, bonds, debentures or other obligations including bonds, debentures
or other obligations convertible into, or exchangeable for stock of any
class, or bearing, warrants or other evidences of optional rights to
purchase or subscribe to, or both, stock of any class, upon the terms, in
the manner and under the condition fixed by resolution of the Board of
Directors prior to the issue thereof, secured or not secured, upon the
real and personal or other property of the Corporation, or any part
thereof, provided that a majority of the whole Board of Directors
concur therein by resolution or in writing.
B. With the sanction of a resolution passed by the holders of
two-thirds of the shares issued and outstanding at any annual or special
meeting of shareholders duly called for that purpose, to sell, assign,
transfer or otherwise dispose of all the rights, franchises and property
of the Corporation as an entirety; and any such sale may be wholly or
partly in consideration of the bonds, mortgages, debenture obligations,
-25-
<PAGE>
securities or evidences of indebtedness, or shares of the capital
stock, of any corporation or corporations of any state, territory or
foreign country, formed or to be formed for the purpose of purchasing the
same.
C. To loan money to, or guarantee an obligation of, or otherwise
assist any officer or other employee of the Corporation or of any
subsidiary, including an officer or employee who is also a director of
the Corporation, whenever, in the judgment of the Board of Directors,
such loan, guarantee, or assistance may reasonably be expected to benefit
the Corporation.
D. To designate three (3) or more of their number to constitute an
executive committee, which committee shall for the time being and
subject to the control and direction of the Board of Directors have and
exercise all the powers of the Board of Directors which may be lawfully
delegated for the management of the business and affairs of the Corpora-
tion, and shall have power to authorize the seal of the Corporation to be
affixed to all papers which may require it.
6. This Restated Certificate of Incorporation is to become effective as
of July 1, 1988.
7. Except to the extent prohibited by law, no Director or officer of the
Corporation shall be personally liable to the Corporation or its shareholders
for damages for breach of any duty owed to the Corporation or its
shareholders, provided that a Director or officer shall not be relieved from
liability for any breach of duty based upon an act or omission (a) in breach
of such person's duty of loyalty to the Corporation or its shareholders, (b)
not in good faith or involving a knowing violation of law or (c) resulting
in receipt by such person of an improper personal benefit. Neither the
amendment or repeal of this Article 7, nor the adoption of any provision of
this Restated Certificate of Incorporation inconsistent with this Article 7,
shall eliminate or reduce the effect of this Article 7 in respect of any
matter which occurred, or any cause of action, suit or claim which but for
this Article 7 would have accrued or arisen, prior to such amendment, repeal
or adoption.
8. Except as may be otherwise provided in respect of directors to be
elected by the holders of Preferred Stock, or any series thereof, by the
terms of any resolution or resolutions of the Board of Directors providing
for any series of Preferred Stock adopted pursuant to the provisions of
Article 3 hereof, the Board of Directors shall be classified, with respect to
the time for which directors shall hold office, into three classes, as
determined by the Board of Directors, each as nearly equal in number as
possible. At the annual meeting of the shareholders of the Corporation at
which this Article 8 is adopted, the first such class of directors shall be
elected for a term expiring upon the next following annual meeting of
shareholders and upon the election and qualification of their respective
successors, the second such class of directors shall be elected for a term
expiring upon the second following annual meeting of shareholders and upon
the election and qualification of their respective successors, and the third
such class of directors shall be elected for a term expiring upon the third
following annual meeting of shareholders and upon the election and
qualification of their respective successors. At each annual meeting of
shareholders following the annual meeting at which this Article 8 is adopted,
directors of the class of directors whose term expires at such annual meeting
-26-
<PAGE>
shall be elected for a term expiring upon the third following annual meeting
of shareholders and upon the election and qualification of their respective
successors. Whenever the number of directors constituting the whole Board of
Directors is changed, except as may be otherwise provided in respect of
directors to be elected by the holders of Preferred Stock, or any series
thereof, by the terms of any resolution or resolutions of the Board of
Directors providing for any series of Preferred Stock adopted pursuant to the
provisions of Article 3 hereof, any increase or decrease in the number of
directors shall be apportioned by the Board of Directors among the three
classes so as to maintain all the classes as equal in number as possible, and
each director so apportioned to a class shall hold office until the next
annual meeting of shareholders at which directors of the class to which such
director was apportioned are to be elected and until such director's
successor shall have been elected and qualified; provided, however, that no
decrease in the number of directors shall effect the then-current term of any
director then in office.
A director may be disqualified from office as required by law or
under any applicable rules, regulations or orders of any federal or state
regulatory authority or by provisions of general applicability in the
Restated Certificate of Incorporation or By-Laws adopted prior to such
director's election.
Any action by the Board of Directors or shareholders creating one or
more vacancies on the Board of Directors by increasing the authorized number
of directors shall be effective only if such action has received the
affirmative vote, in the case of the Board of Directors, of eighty percent
(80%) or more of the directors then holding office or, in the case of the
shareholders, of eighty percent (80%) or more of the combined voting power of
the then outstanding shares of all classes and series of stock of the
Corporation entitled to vote generally in the election of directors, voting
together as a single class. [Article 8 added by Amendment dated May 15,
1990, filed May 16, 1990]
9. Subject to the rights of the holders of shares of any series of
Preferred Stock or any other class of stock or series thereof having a
preference over the Common Stock as to dividends or upon liquidation, any
action required or permitted to be taken by the shareholders of the
Corporation must be effected exclusively either at a duly call annual or
special meeting of shareholders of the Corporation or by the unanimous (but
no less than unanimous) written consent of the shareholders. [Article 9
added by Amendment dated May 15, 1990, filed May 16, 1990]
10. In addition to any requirements of law and any other provision
of the Restated Certificate of Incorporation of the Corporation or any
resolution or resolutions of the Board of Directors providing for any series
of Preferred Stock adopted pursuant to Article 3 hereof (and notwithstanding
the fact that approval by a lesser vote may be permitted by law, any other
Article, or other provisions hereof or any such resolution or resolutions),
the affirmative vote of the holders of eighty percent (80%) or more of the
combined voting power of the then outstanding shares of all classes and
series of stock of the Corporation entitled to vote generally in the election
of directors, voting together as a single class, shall be required to amend,
alter or repeal, or adopted any provision or take action inconsistent with,
this Article 10 or Articles 8 or 9 hereof. [Article 10 added by Amendment
dated May 15, 1990, filed May 16, 1990]
-27-
EXHIBIT (3)A.(ii)
CERTIFICATE OF AMENDMENT
TO THE
RESTATED CERTIFICATE OF INCORPORATION
OF
UJB FINANCIAL CORP.
To: The Secretary of State
State of New Jersey
Pursuant to the provisions of Section 14A:9-2(4) and Section 14A:9-4(3) of
the New Jersey Business Corporation Act, the undersigned corporation executes
the following Certificate of Amendment to the Restated Certificate of
Incorporation, dated July 1, 1988, as amended by Certificates of Amendment
filed June 2, 1989, August 28, 1989, May 16, 1990 and August 20, 1993 (the
"Restated Certificate of Incorporation"):
1. The name of the corporation is UJB Financial Corp. (the "Corporation").
2. The following resolution amending the Restated Certificate of
Incorporation was approved by the directors and thereafter duly adopted
by the shareholders of the corporation on the 25th of April, 1994:
A. RESOLVED, that the first paragraph of Article 3 of the Restated
Certificate of Incorporation be amended to read as follows:
3. The total number of shares of
capital stock authorized and which may
be issued by this Corporation is One
Hundred Thirty-Four Million
(134,000,000) shares, of which One
Hundred Thirty Million (130,000,000)
shares of One and 20/100 Dollars ($1.20)
par value each shall be designated as
Common Stock, and of which Four Million
(4,000,000) shares without par value
shall be designed as Preferred Stock.
All or any part of such authorized
Common Stock and Preferred Stock may be
issued by the Corporation from time to
time and for such consideration as may
be determined upon and fixed by the
Board of Directors as provided by law.
B. The total number of shares entitled to vote on the
adoption of the foregoing amendment to Article 3 was
51,796,087.
-1-
<PAGE>
C. The number of shares voting for and against the
foregoing amendment to Article 3 (and the number of votes
abstaining) were as follows:
Number of Shares
Voting for Amendment Voting Against Amendment Abstaining
40,906,920 3,324,181 384,321
IN WITNESS WHEREOF, said UJB Financial Corp. has caused its
corporate seal to be hereunto affixed and this certificate to be
signed and such seal and signature to be attested by its officers
thereunto duly authorized on this 13th day of May, 1994.
UJB FINANCIAL CORP.
CORPORATE By: /s/ Richard F. Ober, Jr.
SEAL ------------------------
Richard F. Ober, Jr.
Executive Vice President
Attest: /s/ Dennis A. Williams
----------------------
Dennis A. Williams
Assistant Secretary
-2-
<TABLE>
UJB FINANCIAL CORP. Exhibit (11)
COMPUTATION OF NET INCOME PER COMMON SHARE
(dollars in thousands, except per share data)
<CAPTION>
Six Months Ended Three Months Ended
June 30, June 30,
------------------- ---------------------
1994 1993 1994 1993
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Average number of common
shares outstanding
(in thousands) (A) 51,877 51,103 51,981 51,186
========= ========= ========= =========
Net income $59,000 $42,768 $31,610 $22,425
less: Preferred dividends 900 900 450 450
--------- --------- --------- ---------
Net income available to
common shareholders (B) $58,100 $41,868 $31,160 $21,975
========= ========= ========= =========
Net income per common share (B)/(A) $1.12 $0.82 $0.60 $0.43
========= ========= ========= =========
<FN>
Note: The dilutive effect of stock options and equity contracts in 1994 and 1993 was not
material for all periods shown.
</TABLE>
<TABLE>
UJB FINANCIAL CORP. Exhibit (28)A
CONSOLIDATED BALANCE SHEETS
(dollars in thousands)
<CAPTION>
June 30, December 31, June 30,
1994 1993 1993
Assets ------------ ------------ ------------
<S> <C> <C> <C>
Cash and cash equivalents:
Cash and due from banks $ 872,883 $ 720,404 $ 656,098
Federal funds sold and securities purchased under agreements to resell 22,125 99,500 300
------------ ------------ ------------
Total cash and cash equivalents 895,008 819,904 656,398
Interest bearing deposits with banks 15,971 19,962 20,155
Trading account securities 27,455 29,735 26,882
Investment securities available for sale 192,597 1,162,088 789,153
Investment securities:
U.S. Government and Federal agencies 1,833,365 1,267,613 2,104,148
States and political subdivisions 334,443 308,004 341,615
Other securities 1,848,227 881,096 531,810
------------ ------------ ------------
Total investment securities 4,016,035 2,456,713 2,977,573
Loans (net of unearned discount):
Commercial 4,461,023 4,235,631 4,319,319
Mortgage 2,364,482 2,377,440 2,358,195
Instalment 2,133,961 1,994,023 2,022,946
------------ ------------ ------------
Total loans 8,959,466 8,607,094 8,700,460
Less: Allowance for loan losses 236,689 242,104 248,727
------------ ------------ ------------
Net loans 8,722,777 8,364,990 8,451,733
Premises and equipment 160,718 167,477 168,950
Other real estate owned, net of allowance 68,382 72,275 103,814
Accrued interest receivable 77,782 71,728 77,587
Due from customers on acceptances 21,373 20,126 22,298
Other assets 262,513 225,551 243,129
------------ ------------ ------------
Total Assets $ 14,460,611 $ 13,410,549 $ 13,537,672
============ ============ ============
Liabilities and Shareholders' Equity
Deposits:
Non-interest bearing demand deposits $ 2,977,653 $ 2,802,496 $ 2,538,811
Interest bearing deposits:
Savings and time deposits 8,284,226 8,427,272 8,657,203
Commercial certificates of deposit of $100,000 and over 298,409 226,586 269,403
------------ ------------ ------------
Total deposits 11,560,288 11,456,354 11,465,417
Commercial paper 39,889 33,359 55,011
Other borrowed funds 1,414,904 549,449 688,094
Long-term debt 206,342 208,459 195,151
Accrued interest payable 25,693 22,786 36,634
Bank acceptances outstanding 21,373 20,126 22,298
Accrued expenses and other liabilities 177,950 143,942 122,048
------------ ------------ ------------
Total liabilities 13,446,439 12,434,475 12,584,653
Shareholders' equity :
Preferred stock: Authorized 4,000,000 shares without par value:
Series B: Authorized 1,200,000 shares; issued and outstanding 600,166
in 1994 and 1993, adjustable-rate cumulative, $50 stated value 30,008 30,008 30,008
Common stock par value $1.20:
Authorized 130,000,000 shares; issued and outstanding
52,054,860 at June 30, 1994, 51,631,856 at
December 31, 1993 and 51,231,487 at June 30, 1993 62,466 61,958 61,478
Surplus 390,863 384,229 376,958
Retained earnings 536,171 499,879 484,575
Net unrealized loss on investment securities available for sale (5,336) - -
------------ ------------ ------------
Total shareholders' equity 1,014,172 976,074 953,019
------------ ------------ ------------
Total Liabilities and Shareholders' Equity $ 14,460,611 $ 13,410,549 $ 13,537,672
============ ============ ============
Note: Certain 1993 loan balances have been restated for comparative purposes.
</TABLE>
<TABLE>
UJB FINANCIAL CORP. Exhibit (28)B
CONSOLIDATED STATEMENTS OF INCOME
(dollars in thousands, except per share data)
Six Months Ended Three Months Ended
June 30, June 30,
----------------- -----------------
1994* 1993** 1994 1993
-------- -------- -------- --------
<S>
Interest Income <C> <C> <C> <C>
Interest and fees on loans $322,659 $331,492 $166,056 $165,473
Interest on investment securities:
taxable 79,130 85,892 41,633 45,853
tax-exempt 11,264 13,147 5,823 6,283
Interest on investment securities available for sale 26,791 16,936 13,135 7,390
Interest on Federal funds sold and securities
purchased under agreements to resell 441 588 231 37
Interest on trading account securities 437 725 180 361
Interest on deposits with banks 260 183 103 58
-------- -------- -------- --------
Total interest income 440,982 448,963 227,161 225,455
Interest Expense
Interest on savings and time deposits 109,722 140,057 55,426 66,823
Interest on commercial certificates of deposit
$100,000 and over 4,608 3,754 2,736 2,165
Interest on borrowed funds 36,497 26,211 21,131 14,150
-------- -------- -------- --------
Total interest expense 150,827 170,022 79,293 83,138
-------- -------- -------- --------
Net interest income 290,155 278,941 147,868 142,317
Provision for loan losses 37,000 50,000 18,500 25,000
-------- -------- -------- --------
Net interest income after provision for loan losses 253,155 228,941 129,368 117,317
Non-Interest Income
Service charges on deposit accounts 32,207 29,548 16,323 14,789
Service and loan fee income 19,312 16,046 10,230 8,314
Trust income 11,086 10,725 5,279 5,151
Investment securities gains 1,788 6,773 513 214
Trading account gains 88 860 9 416
Other 22,750 24,378 11,111 12,284
-------- -------- -------- --------
Total non-interest income 87,231 88,330 43,465 41,168
Non-Interest Expenses
Salaries 87,845 89,888 44,110 45,268
Pension and other employee benefits 27,113 28,880 13,343 14,012
Occupancy, net 25,809 24,367 12,122 11,726
Furniture and equipment 24,030 22,195 12,248 11,352
Other real estate provision and operating expenses 9,550 22,956 5,497 8,016
FDIC insurance assessment 13,489 16,047 6,742 7,978
Advertising and public relations 5,398 5,251 2,708 2,674
Other 53,053 55,064 27,164 26,866
-------- -------- -------- --------
Total non-interest expenses 246,287 264,648 123,934 127,892
-------- -------- -------- --------
Income before income taxes 94,099 52,623 48,899 30,593
Federal and state income taxes 33,368 13,671 17,289 8,168
-------- -------- -------- --------
Income before cumulative effect of a change in accounting principle 60,731 38,952 31,610 22,425
Cumulative effect of a change in accounting principle (1,731) 3,816 - -
-------- -------- -------- --------
Net Income $ 59,000 $ 42,768 $ 31,610 $ 22,425
======== ======== ======== ========
Net Income Per Common Share:
Income before cumulative effect of a change in accounting principle $ 1.15 $ 0.75 $ 0.60 $ 0.43
Cumulative effect of a change in accounting principle (0.03) 0.07 - -
-------- -------- -------- --------
Net Income Per Common Share $ 1.12 $ 0.82 $ 0.60 $ 0.43
======== ======== ======== ========
Average Common Shares Outstanding (in thousands) 51,877 51,103 51,981 51,186
======== ======== ======== ========
* Effective January 1994, the company adopted SFAS No.112, Accounting for Postemployment Benefits.
** Effective January 1993, the company adopted SFAS No.109, Accounting for Income Taxes.
</TABLE>
<TABLE>
UJB FINANCIAL CORP. Exhibit (28)C
CONSOLIDATED STATEMENTS OF CASH FLOWS
(dollars in thousands)
<CAPTION>
Six Months Ended
June 30,
-----------------------
1994 1993
----------- -----------
<S> <C> <C>
OPERATING ACTIVITIES
Net income $ 59,000 $ 42,768
Adjustments to reconcile net income to net cash
provided by operating activities:
Provision for loan losses and other real estate 42,860 68,611
Depreciation, amortization and accretion 18,467 13,545
Gains on sales of investment and trading account securities (1,876) (7,633)
Gains on sales of mortgages held for sale (117) (1,233)
Gains on the sales of other real estate owned (365) (461)
Proceeds from the sales of other real estate owned 15,976 24,550
Proceeds from the sales of mortgages held for sale 102,313 119,065
Originations of mortgages held for sale (74,435) (118,680)
Net decrease (increase) in trading account securities 2,368 (4,061)
Increase in accrued interest receivable and other assets (43,590) (46,887)
Increase in accrued interest payable, accrued
expenses and other liabilities 38,162 37,475
----------- -----------
NET CASH PROVIDED BY OPERATING ACTIVITIES 158,763 127,059
----------- -----------
INVESTING ACTIVITIES
Proceeds from maturities of investment securities 632,604 389,559
Purchases of investment securities (1,488,532) (737,052)
Purchases of investment securities available for sale - (311,738)
Proceeds from maturities of investment securities available for sale 246,103 73,632
Proceeds from the sales of investment securities available for sale 5,109 337,004
Net decrease (increase) in interest bearing deposits with banks 3,991 (6,336)
Proceeds from the sales of loans - 44,803
Net increase in loans (438,258) (60,747)
Purchases of premises and equipment, net (2,912) (5,631)
----------- -----------
NET CASH USED IN INVESTING ACTIVITIES (1,041,895) (276,506)
----------- -----------
FINANCING ACTIVITIES
Net increase (decrease) in demand and savings deposits 220,568 (25,492)
Net decrease in time deposits (116,634) (295,752)
Net increase in short-term borrowings 873,853 39,705
Principal payments on long-term debt (5,025) (21,884)
Proceeds from the issuance of long-term debt 1,040 -
Dividends paid (22,645) (16,714)
Proceeds from issuance of common stock under dividend
reinvestment and other stock plans 7,142 7,054
Other, net (63) (619)
----------- -----------
NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES 958,236 (313,702)
----------- -----------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 75,104 (463,149)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 819,904 1,119,547
----------- -----------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 895,008 $ 656,398
=========== ===========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid:
Interest payments $ 147,920 $ 170,092
Income tax payments 28,528 11,185
Noncash investing activities:
Loans made in conjunction with the sale of other real estate owned 6,091 8,465
Transfer of loans to other real estate 21,931 30,924
Transfer of investment securities available for sale to
investment securities 707,808 -
</TABLE>
<TABLE>
UJB FINANCIAL CORP. Exhibit (28)D
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(dollars in thousands)
<CAPTION>
Net Total
Preferred Common Retained Unrealized Shareholders'
Stock Stock Surplus Earnings (Loss) Equity
-------- -------- --------- --------- --------- -----------
<S> <C> <C> <C> <C> <C> <C>
Balance, December 31, 1992 $30,008 $61,037 $370,345 $458,880 $ - $920,270
Net Income - - - 42,768 - 42,768
Cash dividends declared:
Preferred stock - Series B - - - (900) - (900)
Common Stock - - - (16,433) - (16,433)
Common stock issued:
Dividend reinvestment and other stock plans
(230,816 shares) - 277 5,349 - - 5,626
Exercise of stock options, net (136,640 shares) - 164 1,264 - - 1,428
Change in valuation allowance for
marketable equity securities - - - 260 - 260
-------- -------- --------- --------- --------- -----------
Balance, June 30, 1993 $30,008 $61,478 $376,958 $484,575 $ - $953,019
======== ======== ========= ========= ========= ===========
Balance, December 31, 1993 $30,008 $61,958 $384,229 $499,879 $ - $976,074
Net Income - - - 59,000 - 59,000
Cash dividends declared:
Preferred stock - Series B - - - (900) - (900)
Common Stock - - - (21,808) - (21,808)
Common stock issued:
Dividend reinvestment and other stock plans
(236,759 shares) - 284 5,363 - - 5,647
Exercise of stock options, net (186,245 shares) - 224 1,271 - - 1,495
Net unrealized loss on investment securities
available for sale - - - - (5,336) (5,336)
-------- -------- --------- --------- --------- -----------
Balance, June 30, 1994 $30,008 $62,466 $390,863 $536,171 ($5,336) $1,014,172
======== ======== ========= ========= ========= ===========
</TABLE>
<TABLE>
UJB FINANCIAL CORP. Exhibit (28)E
CONSOLIDATED AVERAGE BALANCE SHEETS WITH RESULTANT INTEREST AND RATES
(Tax-Equivalent Basis, dollars in thousands)
<CAPTION>
Six Months Ended June 30
-------------------------------------------------------------
1994 1993
----------------------------- -----------------------------
Average Average Average Average
Balance Interest Rate Balance Interest Rate
------------ -------- ------- ------------ -------- -------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Interest earning assets:
Federal funds sold and securities purchased
under agreements to resell $ 17,796 $ 441 5.00 % $ 37,466 $ 588 3.16 %
Interest bearing deposits with banks 16,462 260 3.18 12,580 183 2.93
Trading account securities 31,070 501 3.25 29,470 758 5.19
Investment securities available for sale 1,013,055 26,791 5.29 797,751 16,936 4.25
Investment securities:
U.S. Government and Federal agencies 1,476,123 42,744 5.79 2,175,365 74,085 6.81
States and political subdivisions 305,356 16,732 10.96 359,092 19,463 10.84
Other securities 1,392,941 36,643 5.26 370,332 11,833 6.39
------------ -------- ------- ------------ -------- -------
Total investment securities 3,174,420 96,119 6.06 2,904,789 105,381 7.26
------------ -------- ------- ------------ -------- -------
Loans:
Commercial 4,334,420 154,303 7.18 4,374,133 151,374 6.98
Mortgage 2,351,292 91,001 7.74 2,324,701 96,650 8.32
Instalment 2,029,672 79,152 7.86 2,044,319 85,279 8.41
------------ -------- ------- ------------ -------- -------
Total loans 8,715,384 324,456 7.51 8,743,153 333,303 7.69
------------ -------- ------- ------------ -------- -------
Total interest earning assets 12,968,187 448,568 6.98 12,525,209 457,149 7.36
------------ -------- ------- ------------ -------- -------
Non-interest earning assets:
Cash and due from banks 870,606 820,284
Allowance for loan losses (248,074) (265,528)
Other assets 576,174 608,527
------------ ------------
Total non-interest earning assets 1,198,706 1,163,283
------------ ------------
TOTAL ASSETS $ 14,166,893 $ 13,688,492
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest bearing liabilities:
Savings and time deposits $ 5,440,575 54,448 2.02 $ 5,304,562 63,935 2.43
Other time deposits 2,903,765 55,274 3.84 3,509,692 76,122 4.37
Commercial certificates of deposit
$100,000 and over 285,131 4,608 3.26 259,519 3,754 2.92
------------ -------- ------- ------------ -------- -------
Total interest bearing deposits 8,629,471 114,330 2.67 9,073,773 143,811 3.20
------------ -------- ------- ------------ -------- -------
Commercial paper 43,903 752 3.45 70,791 1,028 2.93
Other borrowed funds 1,246,591 26,586 4.30 791,873 15,203 3.87
Long-term debt 214,290 9,159 8.62 220,053 9,980 9.15
------------ -------- ------- ------------ -------- -------
Total interest bearing liabilities 10,134,255 150,827 3.00 10,156,490 170,022 3.38
------------ -------- ------- ------------ -------- -------
Non-interest bearing liabilities:
Demand deposits 2,828,694 2,447,566
Other liabilities 197,857 141,102
------------ ------------
Total non-interest bearing liabilities 3,026,551 2,588,668
Shareholders' equity 1,006,087 943,334
------------ ------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 14,166,893 $ 13,688,492
============ ============
Net interest income (tax-equivalent basis) 297,741 3.98 % 287,127 3.98 %
======= =======
Tax-equivalent basis adjustment (7,586) (8,186)
--------- ---------
Net Interest Income $ 290,155 $ 278,941
========= =========
Net Interest Income as a Percent of Interest
Earning Assets (tax-equivalent basis) 4.63 % 4.62 %
======= =======
<FN>
Note: -The tax-equivalent adjustment was computed based on a Federal income tax rate of 35% for 1994 and 1993.
-Average balances and rates include non-accruing and renegotiated loans.
-Certain 1993 loan balances have been restated for comparative purposes.
</TABLE>
