<PAGE> 1
As filed with the Securities and Exchange Commission on November 18, 1999
Registration No.
- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------
FORM S-4
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
----------------------
Regions Financial Corporation
(Exact Name of Registrant as Specified in its Charter)
----------------------
Delaware 6711 63-0589368
(State or Other Jurisdiction of (Primary Standard Industrial (I.R.S. Employer
Incorporation or Organization) Classification Code Number) Identification No.)
417 North 20th Street
Birmingham, AL 35203
(205) 944-1300
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
----------------------
Samuel E. Upchurch, Jr.
General Counsel and Corporate Secretary
417 North 20th Street
Birmingham, AL 35203
(205) 326-7860
(Name, address, including zip code, and telephone
number, including area code, of agent for service)
----------------------
Copies to:
<TABLE>
<S> <C> <C>
CHARLES C. PINCKNEY FRANK M. CONNER III G. WAVERLY VEST, JR.
LANGE, SIMPSON, ROBINSON & ALSTON & BIRD LLP BRACEWELL & PATTERSON, LLP
SOMERVILLE LLP 601 PENNSYLVANIA AVENUE, N.W. SOUTH TOWER PENNZOIL PLACE
417 NORTH 20TH STREET, SUITE 1700 NORTH BUILDING, SUITE 250 711 LOUISIANA STREET, SUITE 2900
BIRMINGHAM, AL 35203 WASHINGTON, D.C. 20004 HOUSTON, TEXAS 77002-2781
(205) 250-5000 (202) 508-3303 (713) 223-2900
</TABLE>
--------------------
Approximate date of commencement of proposed sale of securities to the
public: As soon as practicable after this Registration Statement becomes
effective.
If the securities being registered on this form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box. / /
--------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Title of each Proposed maximum Proposed maximum
class of securities Amount to be offering price aggregate Amount of
to be registered registered per unit* offering price* registration fee
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock 2,523,606 $15.414848 $38,901,000 $10,814.48
=======================================================================================================================
</TABLE>
*Calculated in accordance with Rule 457(f), based on the total shareholders'
equity of the company being acquired at September 30, 1999.
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to Section 8(a),
shall determine.
<PAGE> 2
PROXY STATEMENT PROSPECTUS
MINDEN BANCSHARES, INC. REGIONS FINANCIAL CORPORATION
COMMON STOCK
_______ SHARES
MERGER PROPOSED -- YOUR VOTE IS VERY IMPORTANT
The Boards of Directors of Minden Bancshares, Inc. and Regions Financial
Corporation have approved a merger agreement that provides for the acquisition
of Minden Bancshares by Regions. We would complete the acquisition by means of
merging Minden Bancshares into Regions with Regions as the surviving corporation
in the merger. Regions is a regional bank holding company headquartered in
Birmingham, Alabama with banking operations in Alabama, Arkansas, Florida,
Georgia, Louisiana, South Carolina, Tennessee, and Texas. Regions has assets of
about $41.2 billion, deposits of about $29.8 billion, and stockholders' equity
of about $3.0 billion.
If the merger is completed, Minden Bancshares stockholders will receive,
for each share of Minden Bancshares common stock they own, 8.0 shares of Regions
common stock. This exchange ratio is subject to possible adjustment as described
under "The Merger--Possible Adjustment of Exchange Ratio" on page 14. Regions
stockholders will continue to own their existing shares of Regions common stock
after the merger. Shares of Regions common stock are traded on the Nasdaq
National Market under the trading symbol "RGBK".
We can't complete the merger unless the stockholders of Minden Bancshares
approve it. Minden Bancshares has scheduled a special meeting for its
stockholders to vote on the merger.
YOUR VOTE IS VERY IMPORTANT. Whether or not you plan to attend the special
meeting of stockholders, please take the time to vote by completing and mailing
the enclosed proxy card. If you sign, date and mail your proxy card without
indicating how you want to vote, your proxy will be counted as a vote in favor
of the merger. If you don't return your card, or attend the meeting in person,
your shares will not count toward establishing a quorum at the special meeting.
If your shares are represented in person or by proxy at the special meeting and
you abstain from voting, that will have the same effect as a vote against the
merger.
The date, time, and place of the special meeting of stockholders is as
follows:
_______, 1999 _______ p.m.
Main Office, Minden Bancshares, Inc.
401 Main Street
Minden, Louisiana 71055
This Proxy Statement-Prospectus gives you detailed information about the
proposed merger. You can also get information about Regions and Minden
Bancshares from documents filed with the Securities and Exchange Commission. We
encourage you to read this entire document carefully. Your Board of Directors
strongly supports the merger and recommends that you vote in favor of the merger
agreement.
SHARES OF REGIONS COMMON STOCK ARE NOT DEPOSITS, SAVINGS ACCOUNTS OR OTHER
OBLIGATIONS OF A DEPOSITORY INSTITUTION AND ARE NOT INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
REGULATORS HAVE APPROVED THE REGIONS COMMON STOCK TO BE ISSUED UPON COMPLETION
OF THE MERGER OR DETERMINED IF
<PAGE> 3
THIS PROXY STATEMENT-PROSPECTUS IS ACCURATE OR ADEQUATE. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
This Proxy Statement-Prospectus is dated _______, 1999, and was first mailed to
stockholders on or about _______, 1999.
<PAGE> 4
We have not authorized anyone to give any information or make any
representation about the merger or our companies that differs from, or adds to,
the information in this Proxy Statement-Prospectus or in Regions' and Minden
Bancshares' documents that are publicly filed with the Securities and Exchange
Commission. Therefore, if anyone does give you different or additional
information, you should not rely on it.
If you are in a jurisdiction where it is unlawful to offer to exchange or
sell, or to ask for offers to exchange or buy, the securities offered by this
Proxy Statement-Prospectus or to ask for proxies, or if you are a person to whom
it is unlawful to direct such activities, then the offer presented by this Proxy
Statement-Prospectus does not extend to you.
The information contained in this Proxy Statement-Prospectus speaks only as
of its date unless the information specifically indicates that another date
applies.
Information in this Proxy Statement-Prospectus about Regions Financial
Corporation has been supplied by Regions, and information about Minden
Bancshares, Inc. has been supplied by Minden Bancshares.
<PAGE> 5
MINDEN BANCSHARES, INC.
401 MAIN STREET, MINDEN, LOUISIANA, 71055
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD _______, 1999
Notice is hereby given that a special meeting of stockholders of Minden
Bancshares, Inc., will be held at Minden Bancshares' main office, located at 401
Main Street, Minden, Louisiana, 71055 on _______, 1999, at _______:00 p.m.,
local time, for the following purposes:
1. Merger. To consider and vote on the Agreement and Plan of Merger, dated
as of July 13, 1999, between Minden Bancshares and Regions Financial Corporation
pursuant to which (1) Minden Bancshares will merge into Regions with Regions as
the surviving corporation in the merger and (2) each share of Minden Bancshares
common stock (excluding certain shares held by Minden Bancshares, Regions, or
their respective subsidiaries and excluding all shares held by stockholders who
perfect their dissenters' rights) will be converted into 8.0 shares of Regions
common stock, subject to possible adjustment, with cash to be paid in lieu of
any remaining fractional share interest, all as described more fully in the
accompanying Proxy Statement-Prospectus; and
2. Other Business. To transact such other business as may properly come
before the special meeting, including adjourning the special meeting to permit,
if necessary, further solicitation of proxies.
Only stockholders of record at the close of business on _______, 1999, are
entitled to receive notice of and to vote at the special meeting or any
adjournment or postponement thereof. Approval of the merger agreement and the
merger will require the affirmative vote of at least two-thirds of the shares of
Minden Bancshares common stock represented in person or by proxy at the special
meeting, provided a quorum has been established.
Stockholders of Minden Bancshares have a right to dissent from the Merger
and obtain payment of the fair value of their shares in cash by complying with
the applicable provisions of applicable law. DISSENTING STOCKHOLDERS WHO COMPLY
WITH THE PROCEDURAL REQUIREMENTS OF THE BUSINESS CORPORATION LAW OF LOUISIANA
WILL BE ENTITLED TO RECEIVE PAYMENT OF THE FAIR CASH VALUE OF THEIR SHARES IF
THE MERGER IS EFFECTED UPON APPROVAL BY LESS THAN 80% OF THE CORPORATION'S TOTAL
VOTING POWER.
The Board of Directors of Minden Bancshares unanimously recommends that
holders of Minden Bancshares common stock vote FOR the proposals listed above.
We urge you to sign and return the enclosed proxy as promptly as possible,
whether or not you plan to attend the special meeting in person. The proxy may
be revoked by the person executing the proxy by filing with the Secretary of
Minden Bancshares an instrument of revocation or a duly executed proxy bearing a
later date or by electing to vote in person at the special meeting.
By Order of the Board of Directors
John W. Montgomery
Corporate Secretary
_______, 1999
<PAGE> 6
TABLE OF CONTENTS
<TABLE>
<S> <C>
SUMMARY...........................................................................................................
The Companies............................................................................................
The Merger ..............................................................................................
Comparative Per Share Market Price Information ..........................................................
Reasons for the Merger ..................................................................................
Opinion of Financial Advisor ............................................................................
The Special Meeting .....................................................................................
Recommendations to Stockholders .........................................................................
Record Date; Voting Power ...............................................................................
Vote Required ...........................................................................................
Conditions to Completion of the Merger ..................................................................
Termination of the Merger Agreement .....................................................................
Federal Income Tax Consequences .........................................................................
Accounting Treatment ....................................................................................
Interests of Persons in the Merger That Are Different from Yours ........................................
Dissenters' Appraisal Rights ............................................................................
Regulatory Approvals ....................................................................................
Comparative Per Share Data...............................................................................
Selected Financial Data..................................................................................
THE SPECIAL MEETING..............................................................................................
General.................................................................................................
Record Date; Vote Required..............................................................................
THE MERGER.......................................................................................................
General.................................................................................................
Possible Adjustment of Exchange Ratio...................................................................
Treatment of Minden Bancshares Options..................................................................
Background of the Merger................................................................................
Minden Bancshares' Reasons for the Merger...............................................................
Regions' Reasons for the Merger.........................................................................
Opinion of Minden Bancshares' Financial Advisor.........................................................
Effective Time of the Merger............................................................................
Distribution of Regions Stock Certificates and Payment For Fractional Shares............................
Conditions to Consummation of the Merger................................................................
Regulatory Approvals....................................................................................
Waiver, Amendment, and Termination of the Agreement.....................................................
Conduct of Business Pending the Merger..................................................................
Management Following the Merger.........................................................................
Interests of Certain Persons in the Merger..............................................................
Dissenting Stockholders.................................................................................
Federal Income Tax Consequences of the Merger...........................................................
Accounting Treatment....................................................................................
Expenses and Fees.......................................................................................
Resales of Regions Common Stock.........................................................................
EFFECT OF THE MERGER ON RIGHTS OF STOCKHOLDERS...................................................................
Antitakeover Provisions Generally.......................................................................
Authorized Capital Stock................................................................................
</TABLE>
<PAGE> 7
<TABLE>
<S> <C>
Amendment of Certificate or Articles of Incorporation and Bylaws........................................
Classified Board of Directors and Absence of Cumulative Voting..........................................
Removal of Directors....................................................................................
Limitations on Director Liability.......................................................................
Indemnification.........................................................................................
Special Meetings of Stockholders........................................................................
Actions by Stockholders Without a Meeting...............................................................
Stockholder Nominations.................................................................................
Mergers, Consolidations, and Sales of Assets Generally..................................................
Business Combinations with Certain Persons..............................................................
Dissenters' Rights......................................................................................
Stockholders' Rights to Examine Books and Records.......................................................
Dividends...............................................................................................
COMPARATIVE MARKET PRICES AND DIVIDENDS..........................................................................
INFORMATION ABOUT MINDEN BANCSHARES..............................................................................
VOTING SECURITIES AND PRINCIPAL STOCKHOLDERS OF MINDEN BANCSHARES................................................
INFORMATION ABOUT REGIONS........................................................................................
General.................................................................................................
Recent Developments.....................................................................................
SUPERVISION AND REGULATION.......................................................................................
General.................................................................................................
Payment of Dividends....................................................................................
Capital Adequacy........................................................................................
Prompt Corrective Action................................................................................
FDIC Insurance Assessments..............................................................................
DESCRIPTION OF REGIONS COMMON STOCK..............................................................................
STOCKHOLDER PROPOSALS............................................................................................
FORWARD-LOOKING STATEMENTS.......................................................................................
EXPERTS........................................................................................................
OPINIONS........................................................................................................
WHERE YOU CAN FIND MORE INFORMATION..............................................................................
APPENDIX A-Agreement and Plan of Merger.........................................................................A-1
APPENDIX B-Opinion of Hovde Financial LLC......................................................................B-1
APPENDIX C-Copy of Section 131 of the Louisiana Business Corporation Act pertaining
to dissenters rights..............................................................................C-1
</TABLE>
<PAGE> 8
SUMMARY
This summary highlights selected information from this Proxy
Statement-Prospectus. It does not contain all of the information that is
important to you. You should carefully read this entire document and the
documents to which we have referred. These will give you a more complete
description of the proposed merger and its terms. See "Where You Can Find More
Information" (page 50). Each item in this summary includes a page reference that
directs you to a more complete description in this document of the topic
discussed.
THE COMPANIES (PAGES 41 AND 42)
REGIONS FINANCIAL CORPORATION
417 North 20th Street
Birmingham, Alabama 35203
(205) 944-1300
Regions is a regional bank holding company headquartered in Birmingham, Alabama
and incorporated in Delaware. Regions provides banking and other financial
services through banking operations in Alabama, Arkansas, Florida, Georgia,
Louisiana, South Carolina, Tennessee, and Texas. As of September 30, 1999,
Regions' total assets were about $41.2 billion, deposits were about $29.8
billion and stockholders' equity was about $3.0 billion.
The section of this Proxy Statement-Prospectus under the caption "Where You Can
Find More Information" at page 50, refers you to places where you can find more
information about Regions.
MINDEN BANCSHARES, INC.
401 Main Street
Minden, Louisiana, 71055
(318) 377-4283
Minden Bancshares is a bank holding company headquartered in Minden, Louisiana
and incorporated in Louisiana. Minden Bancshares owns Minden Bank & Trust, a
commercial bank which serves customers primarily in Webster, Caddo and
surrounding Parishes in Louisiana. As of September 30, 1999, Minden Bancshares'
total assets were about $327 million, deposits were about $277 million, and
stockholders' equity was about $39 million.
The section of this Proxy Statement-Prospectus under the caption "Where You
Can Find More Information" at page 50 refers you to places where you can find
more information about Minden Bancshares.
THE MERGER (PAGE 13)
Minden Bancshares proposes to merge into Regions with Regions as the
surviving corporation in the merger. When the merger is completed, you will
receive 8.0 shares of Regions stock for each share of Minden Bancshares. You
will not receive a fraction of a share of Regions common stock. Instead, you
will receive a cash payment for any fraction of a share to which you may become
entitled. This exchange ratio may be adjusted upward if the price of Regions
common stock declines significantly relative to the stock price of some other
regional bank holding companies.
<PAGE> 9
If the merger is approved by less than 80% of the voting power of Minden
Bancshares and if you elect to dissent from the merger under Louisiana law and
follow the required procedures, you will receive a cash payment for your shares
of Minden Bancshares common stock instead of receiving Regions common stock.
More information about your rights to dissent from the merger, and the
procedures you must follow should you choose to do so, is included under the
heading "The Merger -- Dissenting Stockholders" at page 25.
The merger agreement protects you as stockholders against a sharp decline
in the trading price of Regions stock compared to stock prices of other bank
holding companies. If the average price of Regions stock over a ten-day period
prior to the special meeting is less than $29.75 and also underperforms a group
of bank holding company stocks by more than 15% between the date of the
agreement and the date of the special meeting, then your Board of Directors can
terminate the merger agreement unless Regions agrees to issue more Regions stock
in exchange for your shares of Minden Bancshares common stock. This mechanism is
explained in detail under the heading "The Merger--Possible Adjustment of
Exchange Ratio" at page 14.
We have attached the merger agreement to this Proxy Statement-Prospectus as
Appendix A. We encourage you to read the merger agreement. It is the legal
document that establishes the terms and conditions of the merger.
COMPARATIVE PER SHARE MARKET PRICE INFORMATION (PAGE 39)
Shares of Regions common stock are quoted on the Nasdaq National Market.
Shares of Minden Bancshares are not quoted on any established market. On July
15, 1999, the last full trading day prior to the public announcement of the
merger, Regions stock closed at $36.78 per share. As of that date, the last
known price of Minden Bancshares stock was $125.00 per share reflecting a trade
completed on July 12, 1999. On _______, 1999, the latest practicable date before
we mailed this Proxy Statement--Prospectus, Regions stock closed at $_______ per
share.
Because the market price of Regions common stock will fluctuate after the
exchange ratio is fixed, we encourage you to obtain more recent prices for
Regions common stock.
REASONS FOR THE MERGER (PAGE 17)
Before deciding to approve and recommend the merger agreement, your Board
of Directors considered the financial condition and prospects of Minden
Bancshares, information about Regions, the financial terms of the merger, the
likelihood the bank regulators will approve the merger, the federal income tax
consequences of the merger, the advice of your Board's legal and financial
advisors, and other factors. Your Board of Directors decided the merger is
advisable and is in your best interests as stockholders.
To review the background of and reasons for the merger in greater detail,
please see the discussion under the headings "The Merger--Background of the
Merger" and "The Merger--Minden Bancshares' Reasons for the Merger" at pages __
and __.
2
<PAGE> 10
OPINION OF FINANCIAL ADVISOR (PAGE 19)
In deciding to approve the merger, your Board considered the opinion of its
financial advisor, Hovde Financial LLC that as of the date of the opinion the
exchange ratio was fair from a financial point of view to you as Minden
Bancshares stockholders. We have attached this opinion as Appendix B to this
Proxy Statement-Prospectus. You should read it carefully.
THE SPECIAL MEETING (PAGE 12)
The Minden Bancshares special meeting will be held at Minden Bancshares'
main office, 401 Main Street, Minden, Louisiana, 71055, at _______ p.m. on
_______, 1999. At the meeting, Minden Bancshares stockholders will be asked to
approve the merger agreement.
RECOMMENDATIONS TO STOCKHOLDERS (PAGE 17)
Your Board of Directors believes that the merger is fair to you and in your
best interests. The Board unanimously recommends that you vote "FOR" the
proposal to approve the merger agreement.
RECORD DATE; VOTING POWER (PAGE 13)
You can vote at the special meeting if you owned Minden Bancshares common
stock as of the close of business on _______, 1999, the record date. On that
date, 280,583 shares of Minden Bancshares common stock were outstanding and
therefore are allowed to vote at the meeting. You will be able to cast one vote
for each share of Minden Bancshares common stock you owned on _______, 1999.
Regions stockholders will not vote on the merger.
VOTE REQUIRED (PAGE 13)
For the special meeting to be held, a quorum must be present. A quorum is
established when a majority of the shares of Minden Bancshares common stock are
represented at the special meeting either in person or by proxy. To approve the
merger, Minden Bancshares stockholders who hold at least two-thirds of the
shares of common stock outstanding on the record date that are represented in
person or by proxy at the special meeting must vote for the merger. If you sign,
date, and mail your proxy card without indicating how you want to vote your
shares of Minden Bancshares common stock, your shares represented by that proxy
will be voted in favor of the merger agreement. If you do not return your proxy
card or attend the meeting in person, your shares of Minden Bancshares common
stock will not be counted toward a quorum at the special meeting. If your shares
are represented in person or by proxy at the special meeting and you abstain
from voting, this will have the same effect as a vote against the merger.
All together, the directors and officers of Minden Bancshares beneficially
hold approximately 21.9% of the shares entitled to be voted at the special
meeting. The members of your Board of Directors have agreed to vote all of their
shares in favor of the merger agreement.
CONDITIONS TO COMPLETION OF THE MERGER (PAGE 20)
The completion of the merger depends on a number of conditions being met,
including the following:
3
<PAGE> 11
- - Minden Bancshares stockholders approving the merger;
- - Receipt of all required regulatory approvals and the expiration of any
regulatory waiting periods;
- - The absence of any governmental or court order blocking completion of the
merger, or of any proceedings by a government body trying to block it;
- - Receipt of an opinion of counsel that the U.S. federal income tax treatment
of you, as the stockholders, and of Minden Bancshares in the merger will
generally be tax-free as we have described it to you in this Proxy
Statement-Prospectus;
- - Filing with the National Association of Securities Dealers, Inc. of
Regions' notification for listing of additional shares on the Nasdaq
National Market for the shares of Regions common stock to be issued in the
merger;
- - Receipt by Minden Bancshares of an opinion of Minden's financial advisor
that the exchange ratio is fair, from a financial point of view, to the
Minden Bancshares stockholders.
In cases where the law permits, Minden Bancshares or Regions could waive a
condition to completing the merger that has not been satisfied and complete the
merger. We can't be certain whether or when any of the conditions we've listed
will be satisfied (or waived, where permissible), or that the merger will be
completed.
TERMINATION OF THE MERGER AGREEMENT (PAGE 22)
Minden Bancshares and Regions can agree at any time to terminate the merger
agreement without completing the merger, even if you, the stockholders, have
already voted to approve it. In addition, either of us can terminate the merger
agreement in the following circumstances:
- - After a final decision by a governmental authority to prohibit the merger,
or after the rejection of an application for a governmental approval
required to complete the merger;
- - If the merger isn't completed by March 31, 2000;
- - If the Minden Bancshares stockholders don't approve the merger; or
4
<PAGE> 12
- - If the other party violates, in a significant way as described in the
merger agreement, and does not properly cure, any of its representations,
warranties or obligations under the merger agreement and the party seeking
termination isn't in violation of the merger agreement.
In addition, Minden Bancshares could decide to terminate the merger
agreement based on the market price of Regions' common stock. If the average
price of Regions common stock during a ten-day period before the date
stockholders approve the merger is less than $29.75 and if the price of Regions
common stock underperforms a group of bank holding company stocks by 15% or more
during the period following our entering into the merger agreement, then the
board of directors of Minden Bancshares could elect to terminate the merger
agreement.
However, Minden Bancshares will not be able to terminate the merger
agreement if Regions elects to issue more shares of Regions common stock in
exchange for shares of Minden Bancshares common stock.
FEDERAL INCOME TAX CONSEQUENCES (PAGE 27)
We have structured the merger with the intent that you won't recognize any
gain or loss for U.S. federal income tax purposes in the merger when you
exchange all of your shares of Minden Bancshares common stock for shares of
Regions common stock in the merger, except in connection with cash received
instead of fractional shares. We have conditioned the merger on our receipt of a
legal opinion that this will be the case, but the opinion won't bind the
Internal Revenue Service, which could take a different view.
THIS TAX TREATMENT MAY NOT APPLY TO CERTAIN MINDEN BANCSHARES STOCKHOLDERS,
INCLUDING THE TYPES OF MINDEN BANCSHARES STOCKHOLDERS DISCUSSED ON PAGE 27, AND
WILL NOT APPLY TO ANY MINDEN BANCSHARES STOCKHOLDER WHO DISSENTS FROM THE MERGER
UNDER LOUISIANA LAW. DETERMINING THE ACTUAL TAX CONSEQUENCES OF THE MERGER TO
YOU CAN BE COMPLICATED. YOUR INDIVIDUAL TAX CONSEQUENCES WILL DEPEND ON YOUR
SPECIFIC SITUATION AND MANY VARIABLES NOT WITHIN OUR CONTROL. YOU SHOULD CONSULT
YOUR OWN TAX ADVISOR FOR A FULL UNDERSTANDING OF THE MERGER'S TAX CONSEQUENCES.
ACCOUNTING TREATMENT (PAGE 28)
We expect the merger to qualify for purchase accounting treatment, meaning
that the assets and liabilities of Minden Bancshares will be recorded at their
estimated fair values and added to those of Regions.
INTERESTS OF PERSONS IN THE MERGER THAT ARE DIFFERENT FROM YOURS (PAGE 24)
Some of the officers of Minden Bancshares have benefit and compensation
plans that provide them with interests in the merger that are different from, or
in addition to, their interests as stockholders of Minden Bancshares. In
particular, they hold outstanding options under Minden Bancshares' existing
stock option plan, which will be converted into stock options to acquire Regions
stock after the merger. In addition, members of Minden Bancshares' Board and its
officers are entitled to indemnification under the merger agreement.
The board of directors of Minden Bancshares was aware of these interests
and considered them in approving and recommending the merger.
DISSENTERS' APPRAISAL RIGHTS (PAGE 25)
Louisiana law permits you to dissent from the merger and to have the fair
value of your stock paid to you in cash, if the merger is approved by less than
80% of the total voting power of Minden Bancshares stockholders. To dissent from
the merger, you must follow certain procedures, including the filing of certain
notices and must vote your shares against the merger. If you dissent from the
merger, your shares of Minden Bancshares common stock will not be exchanged for
shares of Regions common stock in the merger, and your only right will be to
receive the value of your shares in cash.
5
<PAGE> 13
REGULATORY APPROVALS (PAGE 21)
We can't complete the merger unless we obtain the approval of the Board of
Governors of the Federal Reserve System. The U.S. Department of Justice has
input into the Federal Reserve Board's approval process. Federal law requires us
to wait for up to 30 days before completing the merger after the Federal Reserve
Board has approved it. The Federal Reserve Board may shorten the waiting period
to 15 days.
In addition, the merger is subject to the approval of or notice to the
Commissioner of Financial Institutions of the State of Louisiana.
We have filed all of the required notices with these regulatory
authorities. The Federal Reserve Board has issued its approval of the merger.
While we don't know of any reason why we shouldn't obtain the remaining
regulatory approval in a timely manner, we can't be certain when, or if, we'll
obtain it.
COMPARATIVE PER SHARE DATA
The following table shows information about our companies' income per
share, dividends per share and book value per share, and similar information
reflecting the merger of our two companies (which is referred to as "pro forma"
information). In presenting the comparative pro forma information for certain
time periods, we assumed that Minden Bancshares and Regions had been merged
throughout those periods.
In presenting the comparative pro forma information, we also assumed that
Regions will record Minden Bancshares' assets and liabilities at their estimated
fair values and add them to the assets and liabilities of Regions for accounting
and financial reporting purposes (a method which is referred to as the
"purchase" method of accounting).
The information listed as "equivalent pro forma" was computed by
multiplying the pro forma amounts by an assumed exchange ratio of 8.0. It is
intended to reflect the estimate that Minden Bancshares stockholders will be
receiving 8.0 shares of Regions common stock for each share of Minden Bancshares
common stock exchanged in the merger. This may not be the actual exchange ratio,
since the exchange ratio is subject to possible adjustment as explained under
the caption "The Merger-Possible Adjustment of Exchange Ratio" beginning on page
14.
The pro forma information, while helpful in illustrating the financial
attributes of the combined company under one set of assumptions, doesn't attempt
to predict or suggest future results. Also, the information set forth for the
nine-month period ended September 30, 1999 doesn't indicate what the results
will be for the full 1999 fiscal year.
The information in the following table is based on the historical financial
information of our companies. See "Where You Can Find More Information" on page
50.
6
<PAGE> 14
<TABLE>
<CAPTION>
NINE MONTHS ENDED
SEPTEMBER 30,
----------------- YEAR ENDED
1999 1998 DECEMBER 31, 1998
---- ---- -----------------
(Unaudited) (Unaudited except Regions
and Minden historical)
<S> <C> <C> <C>
NET INCOME PER COMMON SHARE
Regions historical...................................... $ 1.78 $ 1.34 $ 1.92
Regions historical -diluted............................. 1.76 1.32 1.88
Minden historical ...................................... 14.75 14.97 20.33
Minden historical -diluted.............................. 14.75 14.97 20.33
Regions and Minden pro forma combined(1)................ 1.79 1.92
Regions and Minden pro forma combined
-diluted(1)............................................ 1.76 1.89
Minden pro forma equivalent(2).......................... 14.32 15.36
Minden pro forma equivalent
-diluted(2)............................................ 14.08 15.12
DIVIDENDS DECLARED PER COMMON SHARE
Regions historical...................................... .75 .69 .92
Minden historical....................................... 1.00 .85 5.00
Minden pro forma equivalent(3).......................... 6.00 5.52 7.36
BOOK VALUE PER COMMON SHARE (PERIOD END)
Regions historical...................................... 13.77
Minden historical....................................... 138.64
Regions and Minden pro forma combined(1)................ 13.94
Minden pro forma equivalent(2).......................... 111.52
</TABLE>
(1) Represents the combined results of Regions and Minden Bancshares as if the
merger were consummated on January 1, 1998 (or September 30, 1999, in the
case of Book Value Per Common Share Data), and were accounted for as a
purchase.
(2) Represents pro forma combined information multiplied by an assumed Exchange
Ratio of 8.0 shares of Regions common stock for each share of Minden
Bancshares common stock.
(3) Represents historical dividends declared per share by Regions multiplied by
an assumed Exchange Ratio of 8.0 shares of Regions common stock for each
share of Minden Bancshares common stock.
(4) The Exchange Ratio is subject to upward adjustment if the average of the
closing sales prices of Regions common stock over a specified period is
less than $29.75. See "The Merger-Possible Adjustment of Exchange Ratio."
The presentation of pro forma merger equivalent information would be
affected by any increase in the Exchange Ratio.
SELECTED FINANCIAL DATA
The following tables show summarized historical financial data for each of
our companies.
The information in the following tables is based on the historical
financial information of our companies. All of the summary financial information
provided in the following tables should be read in connection with this
historical financial information and with the more detailed financial
information we have incorporated by reference in this Proxy
Statement-Prospectus. See "Where You Can Find More Information" on page 50. The
financial information as of or for the interim periods ended September 30, 1999
and 1998 has not been audited and, in the respective opinions of management,
reflects all adjustments (consisting only of normal recurring adjustments)
necessary for a fair presentation of such data.
7
<PAGE> 15
Selected Historical Financial Data of Regions
<TABLE>
<CAPTION>
NINE MONTHS
ENDED SEPTEMBER 30, YEAR ENDED DECEMBER 31,
------------------------- ---------------------------------------------------------------------------
1999 1998 1998 1997 1996 1995 1994
---- ---- ---- ---- ---- ---- ----
(Unaudited)
(In thousands, except per share data and ratios)
<S> <C> <C> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Total interest income .... $ 2,096,563 $ 1,932,506 $ 2,597,786 $ 2,276,584 $ 1,954,283 $ 1,750,427 $ 1,385,512
Total interest expense ... 1,031,252 948,247 1,272,968 1,097,376 942,459 861,242 598,160
Net interest income ...... 1,065,311 984,259 1,324,818 1,179,208 1,011,824 889,185 787,352
Provision for loan
losses .............. 75,389 41,482 60,505 89,663 46,026 37,493 22,058
Net interest income
after loan loss
provision ........... 989,922 942,777 1,264,313 1,089,545 965,798 851,692 765,294
Total noninterest income
before security
gains (losses) ....... 398,137 340,835 467,695 406,484 341,792 280,834 251,837
Security gains (losses) .. 41 3,127 7,002 498 3,311 (697) 681
Total noninterest
expense .............. 788,019 839,939 1,103,708 901,776 837,034 720,825 653,506
Income tax expense ....... 203,754 152,095 213,590 197,222 156,008 134,529 115,853
Net income ............... 396,327 294,705 421,712 397,529 317,859 276,475 248,453
PER SHARE DATA:
Net income ............... $ 1.78 $ 1.34 $ 1.92 $ 1.89 $ 1.64 $ 1.45 $ 1.36
Net income--diluted ..... 1.76 1.32 1.88 1.86 1.61 1.43 1.34
Cash dividends ........... .75 .69 .92 .80 .70 .66 .60
Book value ............... 13.77 13.38 13.61 12.75 11.82 10.74 9.58
OTHER INFORMATION:
Average number of
shares outstanding .. 222,697 220,220 220,114 209,781 194,241 190,896 182,903
Average number of
shares outstanding,
--diluted .......... 225,350 223,935 223,781 213,750 197,751 193,579 185,110
STATEMENT OF CONDITION
DATA (PERIOD END):
Total assets.............. $41,229,164 $35,076,264 $36,831,940 $31,414,058 $26,993,344 $24,419,249 $22,184,508
Securities ............... 9,499,770 7,696,008 7,969,137 6,315,923 5,742,375 5,618,839 5,143,226
Loans, net of unearned
income .............. 27,511,472 23,852,206 24,365,587 21,881,123 18,395,552 16,156,312 14,726,649
Total deposits ........... 29,804,048 27,184,895 28,350,066 25,011,021 22,019,412 19,982,533 18,048,906
Long-term debt ........... 371,148 424,176 571,040 445,529 570,545 762,521 766,774
Stockholders' equity ..... 3,019,937 2,957,653 3,000,401 2,679,821 2,274,563 2,047,398 1,785,026
PERFORMANCE RATIOS:
Return on average
assets(1) ........... 1.36% 1.17% 1.24%(a) 1.35% 1.25%(b) 1.19% 1.23%
Return on average
stockholders'
equity(1) ........... 17.16 13.79 14.62(a) 15.38 14.71(b) 14.30 14.88
Net interest margin(1) ... 4.28 4.01 4.25 4.41 4.36 4.27 4.33
Efficiency (2) ........... 53.23 54.00 60.82(a) 57.78 61.84(b) 61.61 62.89
Dividend payout .......... 42.13 51.49 47.92 42.33 42.68 45.52 44.12
ASSET QUALITY RATIOS:
Net charge-offs to
average loans, net
of unearned income(1) .34% .22% .28% .27% .18% .15% .18%
Problem assets to net
loans and other
real estate (3) ..... .67 .67 .60 .78 .63 .69 .91
Nonperforming assets to
net loans and other
real estate (4) ..... .96 .90 1.15 .91 .83 .81 .98
Allowance for loan losses
to loans, net of
unearned income ..... 1.20 1.36 1.29 1.39 1.38 1.43 1.41
Allowance for loan losses
to nonperforming
assets (4) .......... 125.57 150.72 112.27 151.89 166.41 177.53 144.04
</TABLE>
8
<PAGE> 16
Selected Historical Financial Data of Regions -- Continued
<TABLE>
<CAPTION>
NINE MONTHS
ENDED SEPTEMBER 30, YEAR ENDED DECEMBER 31,
------------------- --------------------------------------------------
1999 1998 1998 1997 1996 1995 1994
---- ---- ---- ---- ---- ---- ----
(Unaudited)
(In thousands, except per share data and ratios)
<S> <C> <C> <C> <C> <C> <C> <C>
LIQUIDITY AND CAPITAL RATIOS:
Average stockholders' equity to
average assets.................. 7.93% 8.51% 8.47% 8.75% 8.50% 8.36% 8.23%
Average loans to average deposits. 90.56 86.91 86.93 84.94 82.42 82.23 75.90
Tier 1 risk-based capital (5)..... 9.42 10.66 10.26 10.48 10.81 11.14 10.69
Total risk-based capital (5)...... 11.17 12.74 12.17 12.93 13.59 14.61 14.29
Tier 1 leverage (5)............... 6.67 7.39 7.40 7.52 7.44 7.49 8.21
</TABLE>
- -------------------
(1) Interim period ratios are annualized.
(2) Noninterest expense divided by the sum of net interest income
(taxable-equivalent basis) and noninterest income net of gains (losses)
from security transactions.
(3) Problem assets include loans on a nonaccrual basis, restructured loans, and
foreclosed properties.
(4) Nonperforming assets include loans on a nonaccrual basis, restructured
loans, loans 90 days or more past due, and foreclosed properties.
(5) The required minimum Tier 1 and total capital ratios are 4% and 8%,
respectively. The minimum leverage ratio of Tier 1 capital to total assets
is 3% to 5%. The ratios for prior periods have not been restated to reflect
the combinations with First National Bancorp and First Commercial
Corporation, accounted for as poolings of interests, or any other
pooling-of-interests transactions.
(a) Ratios for 1998 excluding $80.7 million (after tax) for nonrecurring merger
and consolidation charges are as follows: Return on average assets --
1.48%, Return on average stockholders' equity -- 17.42%, and Efficiency --
54.13%.
(b) Ratios for 1996 excluding $20.2 million (after-tax) charge for SAIF
assessment and merger expenses are as follows: Return on average assets --
1.33%, Return on average stockholders' equity -- 15.64%, and Efficiency --
60.93%.
9
<PAGE> 17
Selected Historical Financial Data of Minden Bancshares
<TABLE>
<CAPTION>
NINE MONTHS
ENDED SEPTEMBER 30, YEAR ENDED DECEMBER 31,
------------------- ----------------------------------------------------------
1999 1998 1998 1997 1996 1995 1994
---- ---- ---- ---- ---- ---- ----
(Unaudited)
(In thousands, except per share data and ratios)
<S> <C> <C> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Total interest income ............... $ 17,070 $ 16,243 $ 21,906 $ 20,088 $ 17,255 $ 15,015 $ 11,100
Total interest expense .............. 7,603 7,143 9,716 8,750 7,420 6,301 4,213
Net interest income ................. 9,467 9,100 12,190 11,278 9,835 8,714 6,887
Provision for loan losses ........... -- -- -- -- -- -- --
Net interest income after
loan loss provision ............ 9,467 9,100 12,190 11,278 9,835 8,714 6,887
Total noninterest income excluding
security gains (losses) ........ 2,235 1,941 2,692 2,384 2,208 1,804 1,381
Security gains (losses) ............. -- -- -- 81 -- -- (253)
Total noninterest expense ........... 5,506 4,916 6,575 6,278 5,359 5,223 3,740
Income tax expense .................. 2,056 1,926 2,603 2,384 2,073 1,617 1,336
Net income .......................... 4,140 4,199 5,704 5,081 4,611 3,668 2,939
PER SHARE DATA:
Net income .......................... $ 14.75 $ 14.97 $ 20.33 $ 18.11 $ 16.43 $ 13.07 $ 10.43
Cash dividends ...................... 1.00 .85 5.00 4.00 3.25 2.75 2.25
Book value .......................... 138.64 128.52 128.71 112.96 98.15 85.55 67.74
OTHER INFORMATION:
Average number of shares outstanding 281 281 281 281 281 281 281
STATEMENT OF CONDITION DATA
(PERIOD END):
Total assets ........................ $327,263 $311,993 $328,375 $292,078 $250,032 $227,011 $172,565
Securities .......................... 135,515 128,070 150,628 124,916 105,231 88,525 90,057
Loans, net of unearned income ....... 150,373 142,382 140,320 136,889 115,346 99,381 66,225
Total deposits ...................... 276,785 262,880 280,371 248,183 215,996 196,096 145,264
Long-term debt ...................... -- -- -- -- -- 90 180
Stockholders' equity ................ 38,901 36,069 36,114 31,686 27,536 24,009 19,021
PERFORMANCE RATIOS:
Return on average assets(1) ......... 1.67% 1.86% 1.85% 1.83% 1.91% 1.75% 1.74%
Return on average stockholders'
equity(1) ...................... 14.68 16.62 16.57 17.02 17.83 16.67 15.17
Net interest margin(1) .............. 4.16 4.42 4.34 4.45 4.48 4.53 4.41
Efficiency (2) ...................... 46.04 43.52 43.18 44.72 43.46 48.52 45.37
Dividend payout ..................... 6.78 5.68 24.59 22.09 19.78 21.04 21.57
ASSET QUALITY RATIOS:
Net charge-offs to average loans,
net of unearned income(1) ...... .44% .06% .15% (.03)% .08% .--% (.07)%
Problem assets to net loans and
other real estate (3) .......... .31 .47 .14 .61 .49 .85 1.73
Nonperforming assets to net loans
and other real estate (4) ...... .55 1.16 .79 1.04 .94 1.02 1.96
Allowance for loan losses to loans,
net of unearned income ......... 1.93 2.48 2.42 2.63 2.87 3.42 5.13
Allowance for loan losses to
nonperforming assets (4) ....... 349.70 213.07 304.22 252.49 305.55 332.39 259.36
</TABLE>
10
<PAGE> 18
Selected Historical Financial Data of Minden Bancshares -- Continued
<TABLE>
<CAPTION>
NINE MONTHS
ENDED SEPTEMBER 30, YEAR ENDED DECEMBER 31,
------------------- -----------------------------------------------------
1999 1998 1998 1997 1996 1995 1994
---- ---- ---- ---- ---- ---- ----
(Unaudited)
(In thousands, except per share data and ratios)
<S> <C> <C> <C> <C> <C> <C> <C>
LIQUIDITY AND CAPITAL RATIOS:
Average stockholders' equity to
average assets.................. 11.38% 11.09% 11.19% 10.77% 10.72% 10.47% 11.44%
Average loans to average deposits. 52.81 55.05 54.18 54.11 52.27 48.66 42.12
Tier 1 risk-based capital (5)..... 21.96 20.14 20.84 19.90 22.29 17.14 25.99
Total risk-based capital (5)...... 23.22 21.39 22.10 21.17 23.56 18.43 27.27
Tier 1 leverage (5)............... 11.19 10.51 10.10 9.59 10.28 9.52 12.01
</TABLE>
- -------------------
(1) Interim period ratios are annualized.
(2) Noninterest expense divided by the sum of net interest income
(taxable-equivalent basis) and noninterest income net of gains (losses)
from security transactions.
(3) Problem assets include loans on a nonaccrual basis, restructured loans, and
foreclosed properties.
(4) Nonperforming assets include loans on a nonaccrual basis, restructured
loans, loans 90 days or more past due, and foreclosed properties.
(5) The required minimum Tier 1 and total capital ratios are 4% and 8%,
respectively. The minimum leverage ratio of Tier 1 capital to total assets
is 3% to 5%.
11
<PAGE> 19
THE SPECIAL MEETING
GENERAL
This Proxy Statement-Prospectus is being furnished to the stockholders of
Minden Bancshares, Inc. in connection with the solicitation on behalf of the
Minden Bancshares Board of Directors of proxies for use at a special meeting of
stockholders. At the special meeting, Minden Bancshares stockholders will be
asked to vote upon a proposal to approve the Agreement and Plan of Merger, dated
as of July 13, 1999, by and between Minden Bancshares and Regions Financial
Corporation.
The special meeting will be held at _______:00 p.m., local time, on
_______, 1999, at the main offices of Minden Bancshares, at 401 Main Street,
Minden, Louisiana, 71055.
Minden Bancshares stockholders are requested promptly to sign, date, and
return the accompanying proxy card to Minden Bancshares in the enclosed
postage-paid, addressed envelope. If you fail to return a properly executed
proxy card or attend the meeting in person, your shares of Minden Bancshares
common stock will not be counted toward a quorum at the special meeting. If you
return a signed and dated proxy card but do not indicate how you want to vote
your shares represented by that proxy, your shares will be voted in favor of the
merger agreement. If your shares are represented in person or by proxy at the
special meeting and you abstain from voting, that will have the same effect as a
vote against the merger agreement.
Any Minden Bancshares stockholder who has delivered a proxy may revoke it
at any time before it is voted by giving notice of revocation in writing or
submitting to Minden Bancshares a signed proxy card bearing a later date,
provided that such notice or proxy card is actually received by Minden
Bancshares before the taking of the stockholder vote at the special meeting. Any
notice of revocation should be sent to Minden Bancshares, Inc., 401 Main Street,
Minden, Louisiana, 71055, Attention: John W. Montgomery, Corporate Secretary. A
proxy will not be revoked by death or supervening incapacity of the stockholder
executing the proxy unless, before the vote, notice of such death or incapacity
is filed with the Secretary. The shares of Minden Bancshares common stock
represented by properly executed proxies received at or before the vote is taken
at the special meeting and not subsequently revoked will be voted as directed in
such proxies. IF INSTRUCTIONS ARE NOT GIVEN, SHARES REPRESENTED BY PROXIES
RECEIVED WILL BE VOTED FOR APPROVAL OF THE MERGER AGREEMENT AND IN THE
DISCRETION OF THE PROXY HOLDER AS TO ANY OTHER MATTERS THAT PROPERLY MAY COME
BEFORE THE SPECIAL MEETING. IF NECESSARY, AND UNLESS CONTRARY INSTRUCTIONS ARE
GIVEN OR UNLESS THE STOCKHOLDER HAS VOTED AGAINST THE MERGER, THE PROXY HOLDER
ALSO MAY VOTE IN FAVOR OF A PROPOSAL TO ADJOURN THE SPECIAL MEETING TO PERMIT
FURTHER SOLICITATION OF PROXIES IN ORDER TO OBTAIN SUFFICIENT VOTES TO APPROVE
THE MERGER AGREEMENT. As of the date of this Proxy Statement-Prospectus, Minden
Bancshares is unaware of any other matter to be presented at the special
meeting.
Solicitation of proxies will be made by mail but also may be made by
telephone, telegram, e-mail or in person by the directors, officers, and
employees of Minden Bancshares, who will receive no additional compensation for
such solicitation but may be reimbursed for out-of-pocket expenses. Brokerage
houses, nominees, fiduciaries, and other custodians will be requested to forward
solicitation materials to beneficial owners and will be reimbursed for their
reasonable out-of-pocket expenses.
12
<PAGE> 20
Minden Bancshares stockholders should not forward any stock certificates
with their proxy cards.
RECORD DATE; VOTE REQUIRED
Minden Bancshares' Board has established the close of business on _______,
1999, as the record date for determining the Minden Bancshares stockholders
entitled to notice of and to vote at the special meeting. Only Minden Bancshares
stockholders of record as of the record date will be entitled to vote at the
special meeting. As of the record date, there were approximately 480 holders
of 280,583 shares of common stock of Minden Bancshares outstanding and entitled
to vote at the special meeting, with each share entitled to one vote. For
information as to persons known by Minden Bancshares to beneficially own more
than 5.0% of outstanding shares of Minden Bancshares common stock as of the
record date, see "Voting Securities and Principal Stockholders of Minden
Bancshares" on page 41.
The presence, in person or by proxy, of a majority of the outstanding
shares of Minden Bancshares common stock is necessary to constitute a quorum of
the stockholders. A quorum must be present before a vote on the merger agreement
can be taken at the special meeting. For these purposes, shares of Minden
Bancshares common stock that are present, or represented by proxy, at the
special meeting will be counted for quorum purposes regardless of whether the
holder of the shares or proxy fails to vote on the merger agreement for any
reason, including broker nonvotes. Generally, a broker who holds shares of
Minden Bancshares common stock in "street" name on behalf of a beneficial owner
lacks authority to vote such shares in the absence of specific voting
instructions from the beneficial owner.
Once a quorum is established, approval of the merger agreement requires the
affirmative vote of the holders of at least two-thirds of the shares of Minden
Bancshares common stock outstanding on the record date which are represented in
person or by proxy at the special meeting. Your failure to attend the meeting or
to return an executed proxy card will have the effect that the shares you held
of record on the record date will not be counted toward a quorum. A failure to
vote shares that are represented in person or by proxy at the special meeting,
including an abstention or a broker nonvote, will have the same effect as a vote
against the merger agreement.
The directors and executive officers of Minden Bancshares and their
affiliates beneficially owned, as of the record date, 61,489 shares (or
approximately 21.9% of the outstanding shares) of Minden Bancshares common
stock. The directors and executive officers of Minden Bancshares and their
affiliates have agreed to vote in favor of the merger agreement. The directors
and executive officers of Regions and their affiliates beneficially owned, as of
the record date, no shares of Minden Bancshares common stock. As of that date,
no subsidiary of either Minden Bancshares or Regions held any shares of Minden
Bancshares common stock in a fiduciary capacity for others.
THE MERGER
The following material describes certain aspects of the merger of Minden
Bancshares into Regions. This description does not purport to be complete and is
qualified in its entirety by reference to the Appendices hereto, including the
merger agreement, which is attached as Appendix A to this Proxy
Statement-Prospectus and incorporated herein by reference. All stockholders are
urged to read the Appendices in their entirety.
13
<PAGE> 21
GENERAL
The merger agreement provides generally for the acquisition of Minden
Bancshares by Regions pursuant to the merger of Minden Bancshares into Regions.
Regions will be the surviving corporation in the merger.
On the date and at the time that we complete the merger, each share of
Minden Bancshares common stock (except shares held by Minden Bancshares,
Regions, or their respective subsidiaries, in each case other than shares Minden
Bancshares, Regions or their subsidiaries hold in a fiduciary capacity or as a
result of debts previously contracted, and excluding all shares held by
stockholders who perfect their dissenters' rights) issued and outstanding at the
effective time of the merger will be converted into 8.0 shares of the $.625 par
value common stock of Regions, subject to possible adjustment. Each share of
Regions common stock outstanding immediately prior to the effective time of the
merger will remain outstanding and unchanged as a result of the merger.
No fractional shares of Regions common stock will be issued in connection
with the merger. In lieu of issuing fractional shares, Regions will make a cash
payment equal to the fractional part of a share which a Minden Bancshares
stockholder would otherwise receive multiplied by the closing price of Regions
common stock on the Nasdaq National Market (as reported by The Wall Street
Journal, or, if not reported thereby, by another authoritative source selected
by Regions), on the last trading day prior to the time we complete the merger.
POSSIBLE ADJUSTMENT OF EXCHANGE RATIO
The merger agreement provides that the exchange ratio could be adjusted
under the circumstances described below. UNDER NO CIRCUMSTANCES WOULD THE
EXCHANGE RATIO BE LESS THAN 8.0 SHARES OF REGIONS COMMON STOCK FOR EACH SHARE OF
MINDEN BANCSHARES COMMON STOCK. The exchange ratio can be adjusted if the Minden
Bancshares Board elects to terminate the merger agreement under the provisions
of the merger agreement described below, and if Regions then elects to avoid
termination of the merger agreement by increasing the exchange ratio.
For purposes of the description of these provisions and their operation,
the following definitions apply.
The "Average Closing Price" is the average of the daily last sale prices of
Regions common stock as reported on the Nasdaq National Market (as reported by
The Wall Street Journal, or, if not reported thereby, another authoritative
source as chosen by Regions) for 10 consecutive full trading days in which such
shares are traded on the Nasdaq National Market ending at the close of trading
on the Determination Date.
The "Determination Date" is the date Minden Bancshares stockholders approve
the merger agreement.
The "Regions Ratio" is the number obtained by dividing the Average Closing
Price by $37.1875.
The "Index Price" is the weighted average of the last sale prices of the
common stock of the bank holding companies defined as the "Index Group" in the
merger agreement as of a given date.
14
<PAGE> 22
The "Index Ratio" is the number obtained by dividing the Index Price on the
Determination Date by the Index Price as of July 13, 1999, less 15%.
If both:
(i) the Average Closing Price is less than $29.75; and
(ii) the Regions Ratio is less than the Index Ratio,
then Minden Bancshares may terminate the merger agreement unless within five
days after receipt of Minden Bancshares notice to terminate, Regions increases
the exchange ratio such that the number of shares of Regions common stock issued
in exchange for each share of Minden Bancshares common stock has a value (based
on the Average Closing Price) equal to the lesser of (1) $238.00 or (2) the
value (based on the Average Closing Price) of the number of a shares of Regions
common stock that would have been exchanged for each share of Minden Bancshares
common stock if the relative performance of Regions common stock as determined
above was 15% lower than the relative performance of the Index Group. If the
merger is approved by the Minden Bancshares stockholders, the Minden Bancshares
Board may elect not to terminate the merger agreement and to consummate the
merger without resoliciting the Minden Bancshares stockholders even if Minden
Bancshares' right to terminate the merger agreement is triggered and, as a
result of the Exchange Ratio, the value of shares of Regions common stock
(valued at the Average Closing Price) issued in exchange for each share of
Minden Bancshares common stock would be less than the lesser of (1) $238.00 or
(2) the value (based on the Average Closing Price) of the number of shares of
Regions common stock that would have been exchanged for each share of Minden
Bancshares common stock if the relative performance of Regions common stock as
determined above was 15% lower than the relative performance of the Index Group.
These conditions reflect the parties' agreement that Minden Bancshares'
stockholders will assume the risk of declines in the per share value of Regions
common stock to $29.75. Any adjustment of the exchange ratio reflecting a
decline in the price of Regions common stock to below $29.75 would be dependent
on whether the Average Closing Price of Regions common stock lags behind a
market basket of comparable bank holding company common stocks (the Index Group
referenced above) by more than 15%.
In making its determination of whether to terminate the merger agreement,
the Minden Bancshares Board will take into account, consistent with its
fiduciary duties, all relevant facts and circumstances that exist at such time,
including, without limitation, information concerning the business, financial
condition, results of operations, and prospects of Regions (including the recent
performance of Regions common stock, the historical financial data of Regions,
customary statistical measurements of Regions' financial performance, and the
future prospects for Regions common stock following the merger), and the advice
of its financial advisors and legal counsel. If the Minden Bancshares Board
elects to terminate the merger agreement, Regions would then determine whether
to proceed with the merger at the higher exchange ratio. In making this
determination, the principal factors Regions will consider include the projected
effect of the merger on Regions' pro forma earnings per share and whether
Regions' assessment of Minden Bancshares' earning potential as part of Regions
justifies the issuance of an increased number of Regions' shares. If Regions
declines to adjust the exchange ratio, Minden Bancshares may elect to proceed
without the adjustment, provided it does so within 12 days after the
Determination Date. REGIONS IS UNDER NO OBLIGATION TO ADJUST THE EXCHANGE RATIO.
15
<PAGE> 23
The operation of the adjustment mechanism can be illustrated by three
scenarios. (For purposes of the scenarios, it has been assumed that the initial
exchange ratio is 8.0, the Starting Price of Regions Common stock is $37.1875,
and the Index Price, as of July 13, 1999, is $100.)
(1) The first scenario occurs if the Average Closing Price is $29.75 or
greater. Under this scenario, regardless of any comparison between the Regions
Ratio and the Index Ratio, there would be no possible adjustment to the exchange
ratio, even though the value of the consideration to be received by Minden
Bancshares stockholders could have fallen from pro forma $297.50 per share, as
of July 13, 1999, to as little as pro forma $238.00 per share, as of the
Determination Date.
(2) The second scenario occurs if the Average Closing Price is less than
$29.75, but does not represent a decline from the Starting Price of more than
15% than the decline of the common stock prices of the Index Group. Under this
scenario, there also would be no possible adjustment to the Exchange Ratio, even
though the value of the consideration to be received by Minden Bancshares
stockholders would have fallen from pro forma $297.50 per share, as of July 13,
1999, to an amount based on the then lower Average Closing Price of Regions
common stock, as of the Determination Date, of less than pro forma $238.00 per
share.
(3) The third scenario occurs if the Average Closing Price declines below
$29.75 and the Regions Ratio is below the Index Ratio. Under this scenario, the
adjustment in the Exchange Ratio is designed to ensure that the Minden
Bancshares stockholders receive shares of Regions common stock having a value
(based upon the Average Closing Price) that corresponds to at least $238.00 or a
15% decline from the stock price performance reflected by the Index Group,
whichever is less.
For example, if the Average Closing Price were $26.00, and the ending
Index Price, as of the Determination Date, were $90, the Regions Ratio (.6992)
would be below the Index Ratio (.75, or .90 minus .15), and Minden Bancshares
could terminate the merger agreement unless Regions elected within five days to
increase the Exchange Ratio to equal 8.582, which represents the lesser of (a)
9.154 [the result of dividing $238.00 (the product of $29.75 and the 8.0
Exchange Ratio) by the Average Closing Price ($26.00)] and (b) 8.582 [the result
of dividing the Index Ratio (.75) times 8.0 by the Regions Ratio (.6992)]. Based
upon the assumed $26.00 Average Closing Price, the new exchange ratio would
represent a value to the Minden Bancshares stockholders of $223.13 for each
share of Minden Bancshares common stock.
If the Average Closing Price were $26.00, and the ending Index Price,
as of the Determination Date, were $100, the Regions Ratio (.6992) would be
below the Index Ratio (.85, or 1.00 minus .15), and Minden Bancshares could
terminate the merger agreement unless Regions elected within five days to
increase the Exchange Ratio to equal 9.154, which represents the lesser of (a)
9.154 [the result of dividing $238.00 (the product of $29.75 and the 8.0
Exchange Ratio) by the Average Closing Price ($26.00)] and (b) 9.726 [the result
of dividing the Index Ratio (.85) times 8.0 by the Regions Ratio (.6992)]. Based
upon the assumed $26.00 Average Closing Price, the new Exchange Ratio would
represent a value to the Minden Bancshares stockholders of $238.00 for each
share of Minden Bancshares common stock.
The actual market value of a share of Regions common stock at the effective
time of the merger and at the time certificates for those shares are delivered
following surrender and exchange of certificates for shares of Minden Bancshares
common stock may be more or less than the Average Closing Price.
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Minden Bancshares stockholders are urged to obtain current market quotations for
Regions common stock. See "Comparative Market Prices and Dividends" on page 39.
TREATMENT OF MINDEN BANCSHARES OPTIONS
The agreement and plan of merger provides that all rights with respect to
Minden Bancshares common stock pursuant to stock options or stock appreciation
rights granted by Minden Bancshares under its stock option plans which are
outstanding at the effective time of the merger, whether or not then
exercisable, will be converted into and will become rights with respect to
Regions common stock, and Regions will assume each of such options in accordance
with the terms of the plan under which it was issued and the agreement by which
it is evidenced. After the effective time of the merger, those options will
become options to purchase Regions common stock, with the exercise price and
number of shares of Regions common stock purchasable thereunder adjusted to
reflect the Exchange Ratio, as it may be adjusted. Those options that were
issued as incentive stock options will be adjusted in accordance with Section
424 of the Internal Revenue Code in order to avoid certain tax consequences for
the option holder.
The executive officers or directors of Minden Bancshares held in the
aggregate options to purchase 13,475 shares of Minden Bancshares common stock,
of which 7,475 were exercisable, as of the date of this Proxy
Statement-Prospectus.
BACKGROUND OF THE MERGER
During the last several years, there have been significant developments in
the banking and financial services industry. These developments have included
the increased emphasis and dependence on automation, specialization of products
and services, increased competition from other financial institutions, and a
trend toward consolidation and geographic expansion, coupled with a relaxation
of regulatory restrictions on interstate conduct of business of financial
institutions.
Mindful of these factors, the board of directors and management have
periodically reviewed and updated strategic plans for Minden Bancshares. As part
of this ongoing process, the board of directors embarked in 1998 on an
exhaustive strategic planning initiative, with the goal of exploring a full
range of alternatives and identifying possible courses of action to respond to
changes in the banking industry, so as to best invest capital and optimize the
return of equity for stockholders. In December, 1998, Minden Bancshares engaged
Hovde Financial LLC to assist it in exploring various strategic alternatives.
Over the next several months, management and representatives of Hovde evaluated
and compared a range of strategic options, including the prospects of remaining
independent, expanding market location, introducing new products and services,
and affiliating with another financial institution. Management periodically
advised the board of directors about the status of the process.
In the first quarter of 1999, the board of directors authorized Hovde to
contact several financial institutions that management, in conjunction with
Hovde, had identified as possible merger partners, to solicit indications of
possible interest in affiliating with Minden Bancshares. One of the institutions
initially solicited was Regions, which expressed an interest in pursuing further
discussions. After further discussions with Regions' representatives, the board
of directors concluded that Regions' corporate culture and banking philosophy
were the most compatible with those of Minden Bancshares, and that the proposed
terms of the merger represented a fair value for Minden Bancshares'
stockholders. The board of directors approved the merger agreement, and it was
executed as of July 13, 1999.
MINDEN BANCSHARES' REASONS FOR THE MERGER.
In approving the merger, the Minden Bancshares directors considered a
number of factors. Without assigning any relative or specific weights to the
factors, the Minden Bancshares Board of Directors considered the following
material factors:
- - the financial terms of the merger, including the relationship of the merger
price to the book value and earnings per share of Minden Bancshares common
stock and the partial protection against a decline in the market value of
Regions common stock;
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- - the nonfinancial terms of the merger, including the treatment of the merger
as a tax-free exchange of Minden Bancshares common stock for Regions common
stock for federal and state income tax purposes;
- - the likelihood of the merger being approved by applicable regulatory
authorities without undue conditions or delay;
- - the opinion rendered by Minden Bancshares' financial advisor to the effect
that, from a financial point of view, the exchange of Minden Bancshares
common stock for Regions common stock on the terms and conditions set forth
in the merger agreement is fair to the holders of Minden Bancshares common
stock;
- - stockholders of Minden Bancshares will receive shares of Regions common
stock, which is publicly traded on the Nasdaq National Market; there is no
current public market for Minden Bancshares common stock;
- - affiliation with a larger holding company would provide the opportunity to
realize economies of scale and increase efficiencies of operations to the
benefit of stockholders and customers. Affiliation with Regions will also
enhance the development of new products and services, the development and
provision of which are becoming increasingly difficult to address by
smaller banks; and
- - potential benefits and opportunities for employees of Minden Bancshares as
a result of both employment in a larger enterprise and Regions' benefit
plans and policies.
The terms of the merger were the result of arms-length negotiations between
representatives of Minden Bancshares and representatives of Regions. Based upon
the consideration of the foregoing factors, the Board of Minden Bancshares
unanimously approved the merger as being in the best interests of Minden
Bancshares and its stockholders. Each member of the Board of Minden Bancshares
has agreed to vote those shares of Minden Bancshares common stock over which
such member has voting authority (other than in a fiduciary capacity) in favor
of the merger.
MINDEN BANCSHARES' BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT MINDEN
BANCSHARES STOCKHOLDERS VOTE FOR APPROVAL OF THE MERGER AGREEMENT.
REGIONS' REASONS FOR THE MERGER
In approving the merger agreement and the merger, the Regions Board
considered a number of factors concerning the benefits of the merger, including
the following:
- - Information Concerning Minden Bancshares: The Regions Board considered
information concerning the business, operations, earnings, asset quality,
and financial condition of Minden Bancshares, and aspects of the Minden
Bancshares franchise, including the market position of Minden Bancshares in
each of the markets in which it operates and the compatibility of the
community bank orientation of the operations of Minden Bancshares to that
of Regions. The Regions Board concluded that Minden Bancshares is a sound,
well managed financial institution which is well positioned in its market
areas and which presents an attractive opportunity for Regions to add to
its franchise in the Louisiana market.
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- - Financial Terms of the Merger: The Regions Board considered various
financial aspects of the merger as reported by Regions' management
including (1) the anticipated effect of the merger on Regions' per share
earnings (with the merger anticipated to have no significant effect on
Regions' earnings per share), (2) the anticipated effect of the merger on
Regions' book value per share (with the merger anticipated not to dilute
significantly Regions' book value per share), and (3) a comparison of
Minden Bancshares to selected peer banks and a comparison of pricing
aspects of the merger to pricing characteristics of other merger
transactions involving financial institutions.
- - Nonfinancial Terms of the Merger. The Regions Board considered various
nonfinancial aspects of the merger, including the treatment of the merger
as a tax-free exchange of Minden Bancshares common stock for Regions common
stock for federal and state income tax purposes and the likelihood of the
merger being approved by applicable regulatory authorities without undue
conditions or delay.
The foregoing discussion of the information and factors considered by the
Regions Board is not intended to be exhaustive but includes all material factors
considered by the Regions Board. In reaching its determination to approve the
merger and the merger agreement, the Regions Board did not assign any relative
or specific weights to the foregoing factors, and individual directors may have
given differing weights to different factors. After deliberating with respect to
the merger and the other transactions contemplated by the merger agreement, and
considering, among other things, the matters discussed above, the Regions Board
determined that the merger is in the best interests of Regions and its
stockholders and unanimously approved the merger agreement.
OPINION OF MINDEN BANCSHARES' FINANCIAL ADVISOR
The Minden Bancshares board of directors has retained Hovde Financial LLC
as financial advisor of Minden Bancshares on the proposed merger into Regions
Financial Corporation to provide an opinion on the fairness of the transaction
to the stockholders of Minden Bancshares.
The full text of the updated fairness opinion (the "Confirming Fairness
Opinion"), which sets forth, among other things, assumptions made, matters
considered and qualifications and limitations on the review undertaken, is
attached hereto as Appendix B and is incorporated herein by reference. The
Confirming Fairness Opinion is rendered as confirmation to a previous fairness
opinion presentation (the "Preliminary Fairness Opinion"), which was provided to
the board of directors of Minden Bancshares for its consideration in determining
whether to approve the merger agreement. Minden Bancshares's stockholders are
urged to read the Confirming Fairness Opinion in its entirety. The Preliminary
Fairness Opinion and the Confirming Fairness Opinion (collectively, the
"Fairness Opinions"), which were directed to the Minden Bancshares board of
directors, address only the fairness to the stockholders of Minden Bancshares,
from a financial point of view, of the merger consideration, and do not
constitute a recommendation to any Minden Bancshares stockholder as to how such
stockholder should vote with respect to the merger. An evaluation of the
proposed transaction and the Fairness Opinions were provided to Minden
Bancshares board of directors. The following is a summary of the procedures
relied upon in the evaluation of the purchase price and the rendering of our
Fairness Opinions. The summary is qualified in its entirety by reference to the
full text of the Confirming Fairness Opinion.
No limitations were imposed by Minden Bancshares on the scope of
Hovde's investigation or the procedures to be followed by Hovde in rendering the
Fairness Opinions. Hovde did not make any recommendation to Minden Bancshares's
board of directors as to the form or amount of consideration to be paid by
Regions to Minden Bancshares in connection with the merger, both of which were
determined through arms'-length negotiations between the parties. In arriving at
its Fairness Opinions, Hovde did not ascribe a specific range of value to
Regions or Minden Bancshares, but rather made its determination as to the
fairness, from a financial point of view, of the merger consideration, on the
basis of the financial and comparative analyses described below. Hovde was not
requested to opine as to, and the Fairness Opinions do not address, Minden
Bancshares' underlying business decision to proceed with or effect the merger.
During the course of the engagement, Hovde reviewed and analyzed
material bearing upon the financial and operating condition of Regions and
Minden Bancshares and material prepared in connection with the merger, including
the following: the merger agreement; certain publicly available information
concerning Regions and Minden Bancshares, including, as applicable: Regions' and
Minden Bancshares' audited consolidated financial statements for each of the
three years ended December 31, 1998, and the quarters ended March 31, 1999 and
June 30, 1999; documents filed with the Securities and Exchange Commission, the
Federal Deposit Insurance Corporation, Federal Reserve Board and other state or
other regulatory agencies, as applicable and/or appropriate, for the
aforementioned three-year period and for the quarterly periods ended March 31,
1999 and June 30, 1999, respectively; as applicable, recent internal reports
and/or financial projections regarding Regions and Minden Bancshares; the nature
and terms of recent sale and merger transactions involving banks and bank
holding companies that Hovde considered relevant; and financial and other
information provided to us by the managements of Regions and Minden Bancshares.
In developing the evaluation of value in the Preliminary Fairness
Opinion and rendering the Confirming Fairness Opinion, Hovde assumed and relied
upon the accuracy and completeness of the financial and other information
provided to it by Minden Bancshares or Regions without assuming any
responsibility for independent verification of such information and further
relied upon the assurances of the managements of Regions and Minden Bancshares
that they were not aware of any facts or circumstances that would make such
information provided by them inaccurate or misleading. With respect to financial
statements and/or projections to the extent such were provided by Regions and
Minden Bancshares, Hovde assumed that such financial statements and/or
projections were reasonably prepared on a basis reflecting the best currently
available estimates and judgments of the respective managements of Regions and
Minden Bancshares. Hovde assumed that the merger will be accounted for using the
purchase method of accounting. In rendering the Fairness Opinions, Hovde did not
conduct a physical inspection of the properties and facilities of Regions or
Minden Bancshares and did not make or obtain any evaluations or appraisals of
the assets or liabilities of Regions or Minden Bancshares. In addition, Hovde
noted that it is not expert in the evaluation of loan portfolios or allowances
for loan, lease or real estate owned losses, and it assumed that the allowances
for loan, lease and real estate owned losses (as currently stated or as adjusted
for in connection with the merger or otherwise) provided to it by Minden
Bancshares and used by it in its analysis and in rendering its Fairness Opinions
were in the aggregate adequate to cover all such losses. The Fairness Opinions
were based upon market, economic and other conditions as they existed on, and
could be evaluated as of, the date the Fairness Opinions, respectively.
The following is a summary of the analyses Hovde performed in the
development of the rendering of its Fairness Opinions. In connection with the
preparation and delivery of the Fairness Opinions to the board of directors of
Minden Bancshares, Hovde performed a variety of financial and comparative
analyses, as described below. The preparation of a fairness opinion involves
various determinations as to the most appropriate and relevant methods of
financial and comparative analysis and the application of those methods to the
particular circumstances and, therefore, such an opinion is not readily
susceptible to summary description. Furthermore, in arriving at its opinion,
Hovde did not attribute any particular weight to any analysis or factor
considered by it, but rather made qualitative judgments as to the significance
and relevance of each analysis and factor. Accordingly, Hovde believes that its
analyses must be considered as a whole and that considering any portion of such
analyses and factors, without considering all analyses and factors, could create
a misleading or incomplete view of the process underlying its opinion. In its
analyses, Hovde made numerous assumptions with respect to industry performance,
general business and economic conditions and other matters, many of which are
beyond the control of Hovde. Any estimates contained in these analyses were not
necessarily indicative of actual values or predictive of future results or
values, which may be significantly more or less favorable than as set forth
therein. In addition, analyses relating to the value of businesses did not
purport to be appraisals or to reflect the prices at which businesses may
actually be sold.
Merger Value Analysis. Hovde calculated the price-to-tangible book,
price-to-earnings multiple, and deposit premium paid, (defined as the merger
value less the tangible book value of Minden Bancshares, divided by Minden
Bancshares' core deposits), in the merger using June 30, 1999 financial data for
Minden Bancshares for the Preliminary Fairness Opinion and September 30, 1999
financial data in regard to the Confirming Fairness Opinion. The analysis for
the Confirming Fairness Opinion based on the closing stock price for Regions as
of November 15, 1999 yielded an aggregate merger value of $71,786,510, a
price-to-tangible book value multiple of 205%, a price-to-last twelve months'
earnings multiple of 12.72x and a deposit premium of 12.59%.
Comparable Company Analysis - Regions. Using publicly available
information, Hovde compared the financial performance and stock market valuation
of Regions with the following selected banking institutions with assets between
$20 billion and $50 billion (the "Comparable Bank Group") deemed relevant by
Hovde: Mellon Financial Corporation (PA), Southtrust Corporation (AL), BB&T
Corporation (NC), Comerica, Inc (MI), Summit Bancorp (NJ), Northern Trust
Corporation (IL), Union Planters Corporation (TN), Fifth Third Bancorp (OH),
UnionBanCal Corporation (CA), Huntington Bancshares, Inc. (OH), Popular, Inc.
(PR), Marshall & Illsley Corporation (WI), M&T Bancorporation (NY), and AmSouth
Bancorporation (AL). Indications of such financial performance and stock market
valuation included profitability (return on average assets and return on average
equity for the latest twelve month period ended September 30, 1999, of 1.37% and
17.12%, respectively, for Regions and averages of 1.43% and 17.19%,
respectively, for the Comparable Bank Group); the ratio of tangible equity to
tangible assets (6.45% for Regions and an average of 6.51% for the Comparable
Bank Group); the ratio of non-performing assets to total assets (0.45% for
Regions and an average of 0.45% for the Comparable Bank Group); current stock
price-to-earnings for the latest twelve month period ended September 30, 1999,
1999 expected earnings and 2000 expected earnings (12.88, 12.84, and 11.71,
respectively, for Regions and an average of 17.18, 18.05, and 15.92,
respectively, for the Comparable Bank Group); current stock price-to-tangible
book value as of September 30, 1999 (249.58% for Regions and an average 342.19%
for the Comparable Bank Group).
Because of the inherent differences in the businesses, operations,
financial conditions and prospects of Minden Bancshares, Regions and the
companies included in the Comparable Bank Group, Hovde believed that a purely
quantitative comparable company analysis would not be particularly meaningful in
the context of the merger. Hovde believed that the appropriate use of a
comparable company analysis in this instance would involve qualitative judgments
concerning the differences between Minden Bancshares and the companies included
in the Comparable Bank Group that would affect the trading values of the
comparable companies.
Comparable Transaction Analysis. Using publicly available information,
Hovde reviewed certain terms and financial characteristics, including historical
price-to-earnings ratio, the price-to-tangible book ratio, and the deposit
premium paid in prior commercial banking institution merger or acquisition
transactions. The first comparable group ("Comparable Group One") included
nationwide bank transactions announced since January 1, 1999 with sellers with
assets between $100 and $500 million that earned over 1.50% on total assets.
Comparable Group One included 20 transactions. The average price-to-last twelve
month earnings for Comparable Group One was 18.4x, and ranged from 9.8x to
23.5x. The average price-to-tangible book value for Comparable Group One was
298.2%, and ranged from 145.9% to 451.2%. The average deposit premium for
Comparable Group One was 25.6%, and ranged from 5.0% to 37.2%.
The second comparable group ("Comparable Group Two") included
transactions announced since March 31, 1998 with sellers located in Louisiana,
Arkansas or Texas with assets between $100 and $500 million. Comparable Group
Two included 17 transactions. The average price-to-last twelve month earnings
for Comparable Group Two was 19.1x, and ranged from 11.6x to 31.3x. The average
price-to-tangible book value for Comparable Group Two was 268.5%, and ranged
from 174.5% to 401.9%. The average deposit premium for Comparable Group Two was
16.6%, and ranged from 8.1% to 27.4%.
Because the reasons for and circumstances surrounding each of the
transactions analyzed were so diverse and because of the inherent differences in
the businesses, operations, financial conditions and prospects of Minden
Bancshares, Regions, and the companies included in the Comparable Bank
Transactions Groups, Hovde believed that a purely quantitative comparable
transaction analysis would not be particularly meaningful in the context of
rendering the fairness opinion. Hovde believed that the appropriate use of a
comparable transaction analysis in this instance would involve qualitative
judgments concerning the differences between the characteristics of these
transactions and the merger which would affect the acquisition values of the
acquired companies and Minden Bancshares.
Discounted Terminal Value Analysis. Hovde estimated the present value
of the Minden Bancshares Common Stock by assuming a range of discount rates from
12% to 15% and a 10% annual growth rate in earnings through 2004, starting with
earnings of $6.28 million in 1999. In arriving at the value of Minden
Bancshares's Common Stock, Hovde assumed an earnings growth rate of 3.5% from
2005 into perpetuity. This terminal value was then discounted, along with yearly
cash flows for 1999 through 2004, to arrive at the present value for Minden
Bancshares's Common Stock. These rates and values were chosen to reflect
different assumptions regarding the required rates of return of holders or
prospective buyers of Minden Bancshares Common Stock. This analysis and its
underlying assumptions yielded a range of value for Minden Bancshares's shares
of approximately $236.77 to $326.58, compared to a total merger consideration of
$249.00 per share as of November 15, 1999.
Hovde is a nationally recognized investment banking firm. Hovde, as
part of its investment banking business, is continuously engaged in the
valuation of businesses and securities in connection with mergers and
acquisitions, competitive biddings, private placements and valuations for
corporate and other purposes. Pursuant to a letter agreement dated December 14,
1998, between Minden Bancshares and Hovde (the "Hovde Agreement"), Minden
Bancshares engaged Hovde to advise it with respect to a potential business
combination (the "Transaction") with Regions and, in the event a Transaction was
consummated with Regions , agreed to pay to Hovde a fee in an amount equal to
1.00% of the purchase price, as defined in the Hovde Agreement, provided,
however, in the event the purchase price exceeds $100,000,000.00, the fee shall
equal 1.00% of the first $100,000,000.00 of the purchase price plus 3.75% of the
amount of the purchase price in excess of $100,000,000.00. The Hovde Agreement
also provides for Minden Bancshares to provide indemnification to Hovde and its
affiliates against certain liabilities to which it may become subject to as a
result of its services to Minden Bancshares under the Hovde Agreement, including
liabilities under securities laws, as well as other specified conditions.
EFFECTIVE TIME OF THE MERGER
Subject to the satisfaction or waiver of the conditions to the obligations
of the parties to effect the merger, the effective time of the merger will occur
on the date and at the time that the Delaware Certificate of Merger and the
Louisiana Certificate of Merger relating to the merger are filed and become
effective with, respectively, the Delaware Secretary of State and the Louisiana
Secretary of State. Unless otherwise agreed upon by Regions and Minden
Bancshares, and subject to the satisfaction or waiver of the conditions to the
obligations of the parties to effect the merger, the parties will use their
reasonable efforts to cause the effective time of the merger to occur on the
last business day of the month in which the last of the following occurs: (1)
the effective date (including the expiration of any applicable waiting period)
of the last federal or state regulatory approval required for the merger and (2)
the date on which the merger agreement is approved by the requisite vote of
Minden Bancshares stockholders; or such later date within 30 days thereof as may
be specified by Regions.
No assurance can be provided that the necessary stockholder and regulatory
approvals can be obtained or that other conditions precedent to the merger can
or will be satisfied. Regions and Minden Bancshares anticipate that all
conditions to consummation of the merger will be satisfied so that the
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merger can be consummated during the fourth quarter of 1999. However, delays in
the consummation of the merger could occur.
The Board of Directors of either Regions or Minden Bancshares generally may
terminate the merger agreement if the merger is not consummated by March 31,
2000, unless the failure to consummate by that date is the result of a breach of
the merger agreement by the party seeking termination. See "--Conditions to
Consummation of the Merger" on page 20 and "--Waiver, Amendment, and Termination
of the Agreement." on page 22.
DISTRIBUTION OF REGIONS STOCK CERTIFICATES AND PAYMENT FOR FRACTIONAL SHARES
Promptly after the effective time of the merger, Regions will cause an
exchange agent selected by Regions to mail to the former stockholders of Minden
Bancshares a form letter of transmittal, together with instructions for the
exchange of such stockholders' certificates representing shares of Minden
Bancshares common stock for certificates representing shares of Regions common
stock.
MINDEN BANCSHARES STOCKHOLDERS SHOULD NOT SEND IN THEIR CERTIFICATES UNTIL
THEY RECEIVE THE FORM LETTER OF TRANSMITTAL AND INSTRUCTIONS. Upon surrender to
the Exchange Agent of certificates for Minden Bancshares common stock, together
with a properly completed letter of transmittal, there will be issued and mailed
to each holder of Minden Bancshares common stock surrendering such items a
certificate or certificates representing the number of shares of Regions common
stock to which such holder is entitled, if any, and a check for the amount to be
paid instead of any fractional share interest, without interest. After the
effective time of the merger, to the extent permitted by law, Minden Bancshares
stockholders of record as of the effective time will be entitled to vote at any
meeting of holders of Regions common stock the number of whole shares of Regions
common stock into which their Minden Bancshares common stock has been converted,
regardless of whether such stockholders have surrendered their Minden Bancshares
common stock certificates. No dividend or other distribution payable after the
effective time with respect to Regions common stock, however, will be paid to
the holder of any unsurrendered Minden Bancshares stock certificate until the
holder duly surrenders such certificate. Upon such surrender, all undelivered
dividends and other distributions and, if applicable, a check for the amount to
be paid instead of any fractional share interest will be delivered to such
stockholder, in each case without interest.
After the effective time of the merger, Minden Bancshares stockholders will
be unable to transfer shares of Minden Bancshares common stock. If certificates
representing shares of Minden Bancshares common stock are presented for transfer
after the effective time, they will be canceled and exchanged for the shares of
Regions common stock and a check for the amount due instead of fractional
shares, if any.
CONDITIONS TO CONSUMMATION OF THE MERGER
Consummation of the merger is subject to a number of conditions, including,
but not limited to:
- - approval from the Board of Governors of the Federal Reserve System and
notice to the Commissioner of Financial Institutions of the State of
Louisiana and the expiration of all applicable waiting periods associated
with these approvals, without any conditions or restrictions (excluding
requirements relating to the raising of additional capital or the
disposition of assets or deposits) that would, in the reasonable judgment
of Regions' Board of Directors, so materially adversely impact the
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economic benefits of the transactions contemplated by the merger agreement
as to render inadvisable the consummation of the merger;
- - the approval by the holders of the requisite number of shares of Minden
Bancshares common stock;
- - the absence of any action by any court or governmental authority
restricting, prohibiting, or making illegal the consummation of the merger
and the other transactions contemplated by the merger agreement;
- - the receipt of a satisfactory opinion of counsel that the merger qualifies
for federal income tax treatment as a reorganization under Section 368(a)
of the Code, with the effects described under "-- Federal Income Tax
Consequences of the Merger" on page 27, including, among others, that the
exchange of Minden Bancshares common stock for Regions common stock will
not give rise to recognition of gain or loss to Minden Bancshares
stockholders, except to the extent of any cash received;
- - filing with the NASD of notification for listing of additional shares on
the Nasdaq National Market for the shares of Regions common stock to be
issued in the merger; and
- - the receipt by Minden Bancshares of an opinion of Minden Bancshares'
financial advisor that the exchange ratio is fair to the Minden Bancshares
stockholders from a financial point of view.
Consummation of the merger also is subject to the satisfaction or waiver of
various other conditions specified in the merger agreement which are customary
in transactions of this nature, including, among others: (1) the delivery by
Regions and Minden Bancshares of opinions of their respective counsel and
certificates executed by their respective duly authorized officers as to the
satisfaction of certain conditions and obligations set forth in the merger
agreement, (2) as of the effective time of the merger, the accuracy of certain
representations and warranties and the compliance in all material respects with
the agreements and covenants of each party, and (3) the receipt by Minden
Bancshares and Regions of all other consents necessary to complete the merger or
to prevent any material default under any contract or permit.
REGULATORY APPROVALS
The merger may not proceed in the absence of receipt of the requisite
regulatory approvals. There can be no assurance that such regulatory approvals
will be obtained or as to the timing of such approvals. It is also possible that
any such approval may be accompanied by a conditional requirement which causes
such approvals to fail to satisfy the conditions set forth in the merger
agreement. Applications for the approvals described below have been submitted
to the appropriate regulatory agencies.
Regions and Minden Bancshares are not aware of any material governmental
approvals or actions that are required for consummation of the merger, except as
described below. Should any other approval or action be required, it presently
is contemplated that such approval or action would be sought.
The merger requires the prior approval of the Federal Reserve Board,
pursuant to Section 3 of the Bank Holding Company Act of 1956. In granting its
approval under Section 3 of the Bank Holding Company Act, the Federal Reserve
Board must take into consideration, among other factors, the financial
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and managerial resources and future prospects of the institutions and the
convenience and needs of the communities to be served. The relevant statutes
prohibit the Federal Reserve Board from approving the merger (1) if it would
result in a monopoly or be in furtherance of any combination or conspiracy to
monopolize or attempt to monopolize the business of banking in any part of the
United States or (2) if its effect in any section of the country may be to
substantially lessen competition or to tend to create a monopoly, or if it would
be a restraint of trade in any other manner, unless the Federal Reserve Board
finds that any anticompetitive effects are clearly outweighed by the public
interest and the probable effect of the transaction in meeting the convenience
and needs of the communities to be served. Under the Bank Holding Company Act,
the merger may not be consummated until the 30th day following the date of
Federal Reserve Board approval, which may be shortened by the Federal Reserve
Board to the 15th day, during which time the United States Department of Justice
may challenge the transaction on antitrust grounds. The commencement of any
antitrust action would stay the effectiveness of the Federal Reserve Board's
approval, unless a court specifically orders otherwise.
The merger is also subject to approval of or notice to the Commissioner of
Financial Institutions of the State of Louisiana. The Federal Reserve Board has
issued its approval of the merger. The Louisiana Commissioner of Financial
Institutions has not yet acted on the matter.
WAIVER, AMENDMENT, AND TERMINATION OF THE AGREEMENT
Prior to the effective time of the merger, and to the extent permitted by
law, any provision of the merger agreement generally may be (1) waived by the
party benefited by the provision or (2) amended by a written agreement between
Regions and Minden Bancshares upon approval of their respective Boards of
Directors; provided, however, that after approval by the Minden Bancshares
stockholders, no amendment that pursuant to the Louisiana Business Corporation
Law requires further approval of the Minden Bancshares stockholders, including
decreasing the consideration to be received by Minden Bancshares stockholders,
may be made without the further approval of the stockholders.
The merger agreement may be terminated, and the merger abandoned, at any
time prior to the effective time of the merger, either before or after approval
by Minden Bancshares stockholders, under certain circumstances, including:
- - by the Board of Directors of either party upon final denial of any required
consent of any regulatory authority, if such denial is nonappealable or was
not appealed within the time limit for appeal;
- - by the Board of Directors of either party, if the holders of the requisite
number of shares of Minden Bancshares common stock shall not have approved
the merger agreement;
- - by mutual consent of the Boards of Directors of Regions and Minden
Bancshares;
- - by the Board of Directors of either party (provided the terminating party
is not in material breach of any representation, warranty, covenant, or
agreement included in the merger agreement), in the event of any inaccuracy
in any representation, warranty, covenant, or agreement by the other party
which meets certain standards specified in the merger agreement and cannot
be or has not been cured within 30 days after the giving of written notice
to the breaching party;
- - by the Board of Directors of either party (provided the terminating party
is not in material breach of any representation, or warranty included in
the merger agreement), in the event of a breach by the
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other party of any covenant or agreement included in the merger agreement
that cannot be cured within 30 days after giving notice to the breaching
party; and
- - by the Board of Directors of either party if the merger shall not have been
consummated by March 31, 2000, but only if the failure to consummate the
merger by such date has not been caused by the terminating party's breach
of the merger agreement.
The Minden Bancshares Board has the right to terminate the merger agreement
in certain situations in which the price of Regions common stock declines
significantly and such decline is significantly greater than the overall decline
of a selected group of bank holding companies' stocks during the same time
period. Termination in such a situation can be avoided if Regions elects (at its
sole discretion) to adjust the exchange ratio according to a formula set forth
in the merger agreement. See "--Possible Adjustment of Exchange Ratio" on page
14.
If the merger agreement is terminated, the parties will have no further
obligations, except with respect to certain provisions, including those
providing for payment of expenses and restricting disclosure of confidential
information. Further, termination generally will not relieve the parties from
the consequences of any uncured willful breach of the merger agreement giving
rise to such termination.
CONDUCT OF BUSINESS PENDING THE MERGER
Each of Minden Bancshares and Regions generally has agreed to operate its
business only in the usual, regular, and ordinary course, and to preserve intact
its business organizations and assets and maintain its rights and franchises.
Each has also agreed to take no action which would materially adversely affect
the ability of either party to obtain any consents required for the merger or to
perform its covenants and agreements under the merger agreement and to complete
the merger. However, Regions and its subsidiaries are not prevented from
discontinuing or disposing of any of its assets or business. Nor is Regions
prevented from acquiring or agreeing to acquire any other entity or any assets
thereof, if such action is, in the judgment of Regions, desirable in the conduct
of the business of Regions and its subsidiaries. In addition, the merger
agreement includes certain other restrictions applicable to the conduct of the
business of Minden Bancshares prior to consummation of the merger, as described
below.
Minden Bancshares. Minden Bancshares has agreed not to take certain actions
relating to the operation of its business before the merger is completed without
the prior written consent of Regions, which Regions has agreed shall not be
unreasonably withheld. The actions Minden Bancshares has agreed not to take are
in the general categories of:
- - amending Articles of Incorporation, Bylaws, or other governing instruments;
- - incurring indebtedness;
- - acquiring any of its outstanding shares or making distributions in respect
of its outstanding shares other than dividends of not more than $7.00 per
share through 1999 and $2.00 per share per quarter thereafter;
- - issuing additional securities;
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- - reclassifying capital stock or selling or encumbering assets;
- - acquiring or investing in other entities;
- - increasing employees' salaries and benefits or accelerating the vesting of
any stock-based compensation or employee benefits;
- - entering into or amending employment contracts;
- - adopting employee benefit plans or amending existing plans;
- - changing accounting methods or practices;
- - commencing or settling litigation; or
- - entering into or terminating material contracts.
The specific agreements not to take certain actions of such character, including
the exceptions and contractually permitted actions, are set forth in the merger
agreement, which is attached as Appendix A. See Article 7 of the merger
agreement.
In addition, Minden Bancshares has agreed not to solicit, directly or
indirectly, any acquisition proposal from any other person or entity. Minden
Bancshares also has agreed not to negotiate with respect to any such proposal,
provide nonpublic information to any party making such a proposal, or enter into
any agreement with respect to any such proposal, except in compliance with the
fiduciary obligations of its Board of Directors. In addition, Minden Bancshares
has agreed to use reasonable efforts to cause its advisors and other
representatives not to engage in any of the foregoing activities.
MANAGEMENT FOLLOWING THE MERGER
Upon consummation of the merger, the present officers and directors of
Regions will retain their respective positions with Regions. Information
pertaining to the directors and executive officers of Regions, executive
compensation, certain relationships and related transactions, and other related
matters is included in Regions' Annual Report on Form 10-K for the year ended
December 31, 1998, incorporated herein by reference. See "Where You Can Find
More Information."
INTERESTS OF CERTAIN PERSONS IN THE MERGER
The merger agreement generally provides that Regions will indemnify and
hold harmless each person entitled to indemnification from Minden Bancshares or
any of its subsidiaries to the full extent permitted by Louisiana law and by
Minden Bancshares' Articles of Incorporation or Bylaws as in effect on the date
of the merger agreement, and that such rights will continue in full force and
effect for six years from the effective time of the merger with respect to
matters occurring at or prior to the effective time.
The merger agreement also provides that, after the effective time of the
merger, Regions will provide generally to officers and employees of Minden
Bancshares and its subsidiaries who, at or after the effective time, become
officers or employees of Regions or its subsidiaries, employee benefits under
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employee benefit plans (other than stock option or other plans involving the
potential issuance of Regions common stock) on terms and conditions that, taken
as a whole, are substantially similar to those currently provided by Regions and
its subsidiaries to their similarly situated officers and employees. For
purposes of participation and vesting (but not benefit accrual) under such
employee benefit plans, service with Minden Bancshares or its subsidiaries prior
to the effective time will be treated as service with Regions or its
subsidiaries. The merger agreement further provides that Regions will cause
Minden Bancshares to honor all employment, severance, consulting, and other
compensation contracts previously disclosed to Regions between Minden Bancshares
or its subsidiaries and any current or former director, officer, or employee,
and all provisions for vested amounts earned or accrued through the effective
time under Minden Bancshares' benefit plans.
As described above under " --Treatment of Minden Bancshares Options," the
merger agreement also provides that all rights with respect to Minden Bancshares
common stock pursuant to stock options or stock appreciation rights granted by
Minden Bancshares under its stock option and other stock-based compensation
plans which are outstanding at the effective time of the merger, whether or not
then exercisable, will be converted into and will become rights with respect to
Regions common stock, and Regions will assume each of such options in accordance
with its terms.
As of the record date, directors and executive officers of Minden
Bancshares owned no shares of Regions common stock.
DISSENTING STOCKHOLDERS
Each Minden Bancshares stockholder who objects to the merger shall be
entitled to the rights and remedies of dissenting stockholders provided in
Section 131 of the Louisiana Business Corporation Law.
The following is a summary of the steps to be taken by a Minden Bancshares
stockholder who is interested in perfecting such holder's dissenters' rights and
should be read in conjunction with the full text of Section 131 of the Louisiana
Business Corporation Law. Each of the steps enumerated below must be taken in
strict compliance with the applicable provisions of the statute in order for
holders of Minden Bancshares common stock to perfect their dissenters' rights.
If the merger is approved by 80% or more of the total voting power of Minden
Bancshares, then dissenters' rights of appraisal, in accordance with the
Louisiana Business Corporation Law, will not be available.
Any written objection, demand, or notice required by the Louisiana Business
Corporation Law in connection with the exercise of dissenters' rights should be
sent to Minden Bancshares or, following the merger, to Regions, in either case
to Minden Bancshares, Inc., 401 Main Street, Minden, Louisiana, 71055,
Attention: Corporate Secretary. It is recommended that all required documents to
be delivered by mail be sent by registered or certified mail with return receipt
requested.
Any holder of Minden Bancshares common stock who wishes to receive in cash
the "fair value" of such shares (determined as of the day before the merger
agreement is approved by the stockholders) may elect to do so by taking all of
the following steps:
- - Such stockholder must file with Minden Bancshares, prior to or at the
special meeting, a written objection to the proposed merger.
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- - Such stockholder must also vote such holder's shares of Minden Bancshares
common stock against the merger. If the merger is approved by the required
vote, but by less than 80% of the total voting power, and the merger
authorized thereby is effected, the Corporation (referring to Minden
Bancshares or, if after the effective time of the merger, Regions, as the
then successor to Minden Bancshares) promptly thereafter shall give written
notice thereof, by registered mail, to each stockholder who both filed such
written objection to, and voted such holder's shares against, the merger,
at such stockholder's last address on Minden Bancshares' records.
- - Each such stockholder, within 20 days after the mailing of such notice to
such holder, but not thereafter, must file with the Corporation a demand in
writing for the fair cash value of such holder's shares of Minden
Bancshares common stock as of the day before such vote was taken, and such
holder must state in such demand the value demanded and a post office
address to which the reply of the Corporation may be sent.
- - At the same time, such stockholder must deposit in escrow in a chartered
bank or trust company located in Webster Parish the certificates
representing such holder's shares of Minden Bancshares common stock, duly
endorsed for transfer to the Corporation upon the sole condition that such
certificates shall be delivered to the Corporation upon payment of the
value of the shares determined in accordance with the provisions of Section
131 of the Louisiana Business Corporation Law.
- - With the demand, the stockholder must deliver to the Corporation the
written acknowledgment of such bank or trust company that it so holds such
holder's certificates of Minden Bancshares common stock.
Any stockholder who fails to take each of the required actions outlined
above in a timely manner will not be entitled to exercise the rights of a
dissenting stockholder.
Unless the objection, demand, and acknowledgment are made and delivered by
the stockholder within the required time period, such holder conclusively shall
be presumed to have acquiesced in the merger. If the Corporation does not agree
to the value so stated and demanded, or does not agree that a payment is due,
within 20 days after receipt of such demand and acknowledgment, it shall notify
the stockholder in writing, at the designated post office address, of its
disagreement and shall state in such notice the value it will agree to pay if
any payment should be held to be due; otherwise it shall be liable for, and
shall pay to the dissatisfied stockholder, the value demanded by the
dissatisfied stockholders.
In case of disagreement as to such fair cash value, or as to whether any
payment is due, after compliance by the parties with the provisions described
above, the dissatisfied stockholder, within 60 days after receipt of notice in
writing of the Corporation's disagreement, but not thereafter, may file suit
against the Corporation, in the district court of Webster Parish praying the
court to fix and decree the fair cash value of the dissatisfied stockholder's
shares of Minden Bancshares common stock as of the day before the stockholder
vote on the merger agreement was taken, and the court, on such evidence as may
be adduced in relation thereto, shall determine summarily whether any payment is
due and, if so, shall determine such cash value and render judgment accordingly.
Any stockholder entitled to file such suit, within such 60-day period, but not
thereafter, may intervene as a plaintiff in such suit filed by another
stockholder and recover therein judgment against the Corporation for the fair
cash value of such holder's shares of Minden Bancshares common stock. Failure of
the stockholder to bring suit, or to intervene in such a suit, within 60 days
after receipt of notice of disagreement by the Corporation conclusively shall
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bind the stockholder (1) to acquiesce in, and not contest, the Corporation's
statement that no payment is due or (2) if the Corporation does not contend that
no payment is due, to accept the value of such holder's shares of Minden
Bancshares common stock as fixed by the Corporation in its notice of
disagreement.
In an appraisal proceeding commenced under these provisions, the court will
tax the cost of the proceeding against the corporation, unless the corporation
shall have offered to pay an amount deemed to be the fair cash value of the
shares, shall have deposited such amount in the registry of the court pending
the court's ruling, and the court shall have awarded less than that amount to
the dissatisfied stockholder. In that case, the court will tax the costs of the
proceeding against the stockholder.
A stockholder, upon filing a demand for the value of such holder's shares,
shall cease to have any of the rights of a stockholder, except the rights
accorded by Section 131 of the Louisiana Business Corporation Law. Such a demand
may be withdrawn by the stockholder at any time before the Corporation gives
notice of disagreement, as provided by the Louisiana Business Corporation Law.
After such notice of disagreement is given, withdrawal of the demand shall
require the consent of the Corporation. If a demand is withdrawn, or the merger
is abandoned or rescinded, or a court shall determine that the stockholder is
not entitled to receive payment for such holder's shares of Minden Bancshares
common stock, or the stockholder shall otherwise lose such holder's dissenters'
rights, such holder shall not have the right to receive a cash payment for such
holder's shares of Minden Bancshares common stock, such holder's share
certificates shall be returned (and, on such holder's request, new certificates
shall be issued in exchange for the old ones endorsed to the Corporation), and
such holder shall be reinstated to all rights as a stockholder as of the filing
of such holder's demand for value, including the right to payment of any
intervening dividend or other distribution, or if any such rights have expired
or any such dividend or distribution other than in cash has been completed, in
lieu thereof, at the election of the Corporation, the fair value thereof in cash
as determined by the Corporation's Board as of the time of such expiration or
completion, but without prejudice otherwise to any corporate proceedings that
may have been taken in the interim.
Any dissenting Minden Bancshares stockholder who perfects such holder's
right to be paid the value of such holder's shares will recognize taxable gain
or loss upon receipt of cash for such shares for federal income tax purposes.
See "--Federal Income Tax Consequences of the Merger."
FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER
THE FOLLOWING IS A DISCUSSION OF THE MATERIAL FEDERAL INCOME TAX
CONSEQUENCES OF THE MERGER TO HOLDERS OF MINDEN BANCSHARES COMMON STOCK. THIS
DISCUSSION DOES NOT ADDRESS ALL ASPECTS OF FEDERAL INCOME TAXATION THAT MAY BE
RELEVANT TO A STOCKHOLDER IN LIGHT OF THE STOCKHOLDER'S PARTICULAR CIRCUMSTANCES
OR TO THOSE MINDEN BANCSHARES STOCKHOLDERS SUBJECT TO SPECIAL RULES, SUCH AS
STOCKHOLDERS WHO ARE NOT CITIZENS OR RESIDENTS OF THE UNITED STATES, THOSE WHO
RECEIVED THEIR MINDEN BANCSHARES COMMON STOCK AS COMPENSATION DIRECTLY OR
THROUGH THE EXERCISE OF STOCK OPTIONS, THOSE WHO HOLD MINDEN BANCSHARES COMMON
STOCK AS PART OF A "STRADDLE" OR "CONVERSION TRANSACTION," THOSE WHO DO NOT HOLD
THEIR MINDEN BANCSHARES COMMON STOCK AS A CAPITAL ASSET WITHIN THE MEANING OF
SECTION 1221 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED, OR THOSE
STOCKHOLDERS WHO ARE TAX EXEMPT ENTITIES, INSURANCE COMPANIES, SECURITIES
DEALERS, OR FINANCIAL INSTITUTIONS. THIS DISCUSSION ALSO DOES NOT ADDRESS ANY
ASPECTS OF STATE, LOCAL, OR FOREIGN TAXATION. THIS DISCUSSION IS BASED UPON
LAWS, REGULATIONS, RULINGS AND DECISIONS NOW IN EFFECT, ALL OF WHICH ARE SUBJECT
TO CHANGE (POSSIBLY WITH RETROACTIVE EFFECT) BY LEGISLATION, ADMINISTRATIVE
ACTION, OR JUDICIAL DECISION. NO RULING HAS BEEN OR WILL BE REQUESTED FROM THE
INTERNAL REVENUE SERVICE ON ANY MATTER RELATING TO THE TAX CONSEQUENCES OF THE
MERGER.
Consummation of the merger is conditioned upon receipt by Regions and
Minden Bancshares of an opinion from Alston & Bird LLP, special counsel to
Regions, concerning the material federal income tax consequences of the merger.
Based upon the assumption that the merger is consummated in accordance
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with the merger agreement and upon factual statements and factual
representations made by Regions and Minden Bancshares, it is such firm's opinion
that:
- - The merger will constitute a reorganization within the meaning of Section
368(a) of the Code, and Minden Bancshares and Regions will each be "a party
to a reorganization" within the meaning of Section 368(b) of the Code.
- - No gain or loss will be recognized by holders of Minden Bancshares common
stock upon the exchange in the merger of all of their Minden Bancshares
common stock solely for shares of Regions common stock (except with respect
to any cash received in lieu of fractional share interests in Regions
common stock).
- - The aggregate tax basis of the Regions common stock received by the Minden
Bancshares stockholders in the merger will, in each instance, be the same
as the aggregate tax basis of the Minden Bancshares common stock
surrendered in exchange therefor, less the basis of any fractional share of
Regions common stock settled by cash payment.
- - The holding period of the Regions common stock received by the Minden
Bancshares stockholders in the merger will, in each instance, include the
holding period of the Minden Bancshares common stock surrendered in
exchange therefor, provided that such Minden Bancshares common stock is
held as a capital asset at the effective time of the merger.
- - The payment of cash to Minden Bancshares stockholders in lieu of fractional
share interests of Regions common stock will be treated for federal income
tax purposes as if the fractional shares were distributed as part of the
exchange and then were redeemed by Regions. These cash payments will be
treated as having been received as distributions in full payment in
exchange for the stock redeemed, as provided in Section 302(a) of the Code.
- - Where solely cash is received by a Minden Bancshares stockholder in
exchange for Minden Bancshares common stock pursuant to the exercise of
dissenters' rights, such cash will be treated as having been received in
redemption of such holder's Minden Bancshares common stock, subject to the
provisions and limitations of Section 302 of the Code.
THE TAX OPINION DOES NOT ADDRESS ANY STATE, LOCAL, FOREIGN, OR OTHER TAX
CONSEQUENCES OF THE MERGER. MINDEN BANCSHARES STOCKHOLDERS SHOULD CONSULT THEIR
OWN TAX ADVISORS WITH RESPECT TO THE TAX CONSEQUENCES OF THE PROPOSED
TRANSACTION TO THEM INDIVIDUALLY, INCLUDING TAX REPORTING REQUIREMENTS AND TAX
CONSEQUENCES UNDER STATE, LOCAL, AND FOREIGN LAW.
ACCOUNTING TREATMENT
It is anticipated that the merger will be accounted for as a "purchase," as
that term is used pursuant to generally accepted accounting principles, for
accounting and financial reporting purposes. Under the purchase method of
accounting, the assets and liabilities of Minden Bancshares as of the effective
time of the merger will be recorded at their estimated respective fair values
and added to those of Regions. Financial statements of Regions issued after the
effective time will reflect such values and will not be restated retroactively
to reflect the historical financial position or results of operations of Minden
Bancshares.
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EXPENSES AND FEES
The merger agreement provides, in general, that each of the parties will
bear and pay its own expenses in connection with the transactions contemplated
by the merger agreement, including fees and expenses of its own financial or
other consultants, investment bankers, accountants, and counsel, except that
Regions will bear and pay the filing fees and one-half of the printing costs in
connection with the registration statement and this Proxy Statement-Prospectus.
RESALES OF REGIONS COMMON STOCK
The Regions common stock to be issued to Minden Bancshares stockholders in
the merger has been registered under the Securities Act of 1933, but that
registration does not cover resales of those shares by persons who control, are
controlled by, or are under common control with, Minden Bancshares (such persons
are referred to hereinafter as "affiliates" and generally include executive
officers, directors, and 10% stockholders) at the time of the special meeting.
Affiliates may not sell shares of Regions common stock acquired in connection
with the merger, except pursuant to an effective registration statement under
the Securities Act or in compliance with SEC Rule 145 or in accordance with a
legal opinion satisfactory to Regions that such sale or transfer is otherwise
exempt from the Securities Act registration requirements.
Rule 145 under the Securities Act restricts the sale of Regions common
stock received in the merger by affiliates and certain of their family members
and related interests. Under the rule, during the one-year period following the
effective time of the merger, affiliates of Minden Bancshares may resell
publicly the Regions common stock received by them in the merger subject to
certain limitations as to the amount of Regions common stock sold in any
three-month period and as to the manner of sale, and subject to the currency of
Regions' periodic reporting obligations under the 1934 Act. After the one-year
period and within two years following the effective time of the merger,
affiliates of Minden Bancshares who are not affiliates of Regions may effect
such resales subject only to the currency of Regions' periodic reporting
requirements. After two years, such affiliates of Minden Bancshares who are not
affiliates of Regions may resell their shares without restriction. Persons who
are affiliates of Regions after the effective time may publicly resell the
Regions common stock received by them in the merger subject to similar
limitations and subject to certain filing requirements specified in SEC Rule
144. Affiliates will receive additional information regarding the effect of Rule
145 on their ability to resell Regions common stock received in the merger.
Affiliates also would be permitted to resell Regions common stock received in
the merger pursuant to an effective registration statement under the Securities
Act or an available exemption from the Securities Act registration requirements.
This Proxy Statement-Prospectus does not cover any resales of Regions common
stock received by persons who may be deemed to be affiliates of Minden
Bancshares or Regions.
Each person who Minden Bancshares reasonably believes will be an affiliate
of Minden Bancshares has delivered to Regions a written agreement providing that
such person generally will not sell, pledge, transfer, or otherwise dispose of
any Regions common stock to be received by such person upon consummation of the
merger, except in compliance with the Securities Act and the rules and
regulations of the SEC promulgated thereunder.
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EFFECT OF THE MERGER ON RIGHTS OF STOCKHOLDERS
As a result of the merger, holders of Minden Bancshares common stock will
be exchanging their shares of a Louisiana corporation governed by the Louisiana
Business Corporation Law and Minden Bancshares' Articles of Incorporation, as
amended, and Bylaws, for shares of Regions, a Delaware corporation governed by
the Delaware General Corporation Law and Regions' Certificate of Incorporation
and Bylaws. Significant differences exist between the rights of Minden
Bancshares stockholders and those of Regions stockholders. The material
differences are summarized below. In particular, Regions' Certificate and Bylaws
contain several provisions that under certain circumstances may have an
antitakeover effect in that they could impede or prevent an acquisition of
Regions unless the potential acquirer has obtained the approval of Regions'
Board of Directors. The following discussion is necessarily general; it is not
intended to be a complete statement of all differences affecting the rights of
stockholders and their respective entities, and it is qualified in its entirety
by reference to the Louisiana Business Corporation Law and the Delaware General
Corporation Law as well as to Regions' Certificate and Bylaws and Minden
Bancshares' Articles and Bylaws.
ANTITAKEOVER PROVISIONS GENERALLY
We refer to the provisions of Regions' Certificate and Bylaws described
below under the headings, "--Authorized Capital Stock," "--Amendment of
Certificate or Articles of Incorporation and Bylaws," "--Classified Board of
Directors and Absence of Cumulative Voting," "--Removal of Directors,"
"--Limitations on Director Liability," "--Special Meetings of Stockholders,"
"--Actions by Stockholders Without a Meeting," "--Stockholder Nominations," and
"--Mergers, Consolidations, and Sales of Assets Generally," and the provisions
of the Delaware General Corporation Law described under the heading "--Business
Combinations With Certain Persons," as the protective provisions. In general,
one purpose of the protective provisions is to assist Regions' Board of
Directors in playing a role in connection with attempts to acquire control of
Regions, so that the Board can advance and protect the interests of Regions and
its stockholders as appropriate under the circumstances, including, if the Board
determines that a sale of control is in their best interests, by enhancing the
Board's ability to maximize the value to be received by the stockholders upon
such a sale.
Although Regions' management believes the protective provisions are,
therefore, beneficial to Regions' stockholders, the protective provisions also
may tend to discourage some takeover bids. As a result, Regions' stockholders
may be deprived of opportunities to sell some or all of their shares at prices
that represent a premium over prevailing market prices. On the other hand,
defeating undesirable acquisition offers can be a very expensive and
time-consuming process. To the extent that the protective provisions discourage
undesirable proposals, Regions may be able to avoid those expenditures of time
and money.
The protective provisions also may discourage open market purchases by a
potential acquirer. Such purchases may increase the market price of Regions
common stock temporarily, enabling stockholders to sell their shares at a price
higher than that which otherwise would prevail. In addition, the protective
provisions may decrease the market price of Regions common stock by making the
stock less attractive to persons who invest in securities in anticipation of
price increases from potential acquisition attempts. The protective provisions
also may make it more difficult and time consuming for a potential acquirer to
obtain control of Regions through replacing the Board of Directors and
management. Furthermore, the protective provisions may make it more difficult
for Regions' stockholders to replace the Board of Directors or management, even
if a majority of the stockholders believes such replacement is in the best
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<PAGE> 38
interests of Regions. As a result, the protective provisions may tend to
perpetuate the incumbent Board of Directors and management.
AUTHORIZED CAPITAL STOCK
Regions. Regions' certificate of incorporation authorizes the issuance of
up to 500,000,000 shares of Regions common stock and 5,000,000 shares of
preferred stock. At September 30, 1999, 224,170,794 shares of Regions common
stock were issued, including 4,882,066 treasury shares, and 219,288,728 shares
were outstanding. At that date no preferred stock was issued. Regions' Board of
Directors may authorize the issuance of additional shares of Regions common
stock or preferred stock without further action by Regions' stockholders, unless
such action is required in a particular case by applicable laws or regulations
or by any stock exchange upon which Regions' capital stock may be listed. The
Regions' certificate of incorporation does not provide preemptive rights to
Regions stockholders.
The authority to issue additional shares of Regions capital stock provides
Regions with the flexibility necessary to meet its future needs without the
delay resulting from seeking stockholder approval. The authorized but unissued
shares of Regions common stock will be issuable from time to time for any
corporate purpose, including, without limitation, stock splits, stock dividends,
employee benefit and compensation plans, acquisitions, and public or private
sales for cash as a means of raising capital. Such shares could be used to
dilute the stock ownership of persons seeking to obtain control of Regions. In
addition, the sale of a substantial number of shares of Regions common stock to
persons who have an understanding with Regions concerning the voting of such
shares, or the distribution or declaration of a dividend of shares of Regions
common stock (or the right to receive Regions common stock) to Regions
stockholders, may have the effect of discouraging or increasing the cost of
unsolicited attempts to acquire control of Regions. Regions has committed not to
issue shares of preferred stock for any antitakeover purpose, including any
purpose to make a change in control of Regions more costly or difficult.
Minden Bancshares. Minden Bancshares' articles authorize the issuance of up
to 500,000 shares of Minden Bancshares common stock, which is the only class of
capital stock authorized and of which 280,583 shares were issued and outstanding
as of the record date.
Pursuant to the Louisiana Business Corporation Law, Minden Bancshares'
Board of Directors may authorize the issuance of additional shares of Minden
Bancshares common stock without further action by Minden Bancshares'
stockholders. Minden Bancshares' Articles do not provide the stockholders of
Minden Bancshares with preemptive rights to purchase or subscribe to any
unissued authorized shares of Minden Bancshares common stock or any option or
warrant for the purchase thereof, in accordance with the Louisiana Business
Corporation Law.
AMENDMENT OF CERTIFICATE OR ARTICLES OF INCORPORATION AND BYLAWS
Regions. The Delaware General Corporation Law generally provides that the
approval of a corporation's board of directors and the affirmative vote of a
majority of (1) all shares entitled to vote thereon and (2) the shares of each
class of stock entitled to vote thereon as a class is required to amend a
corporation's certificate of incorporation, unless the certificate specifies a
greater voting requirement. Regions' certificate of incorporation states that
its provisions regarding authorized capital stock, election, classification, and
removal of directors, the approval required for certain business combinations,
meetings of stockholders, and amendment of Regions' certificate of incorporation
and bylaws may be amended or
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<PAGE> 39
repealed only by the affirmative vote of the holders of at least 75% of the
outstanding shares of Regions common stock.
Regions' certificate of incorporation also provides that the board of
directors has the power to adopt, amend, or repeal the bylaws. Any action taken
by the stockholders with respect to adopting, amending, or repealing any bylaws
may be taken only upon the affirmative vote of the holders of at least 75% of
the outstanding shares of Regions common stock.
Minden Bancshares. The Louisiana Business Corporation Law generally
provides that a Louisiana corporation's articles of incorporation may be amended
by the affirmative vote of two-thirds of the voting power present at a meeting,
unless the articles of incorporation provide for a higher or lower voting
requirement. Minden Bancshares' articles and bylaws do not provide for an
alternative voting requirement.
The Louisiana Business Corporation Law provides that the Board of Directors
has the power to amend or alter the bylaws, provided shareholders may repeal any
bylaws so made. Minden Bancshares articles provide that the stockholders have
the right concurrently with the Board of Directors to amend the bylaws or adopt
new bylaws. The Articles also provide that the shareholders may provide that
bylaws adopted or amended by the stockholders may not be amended or repealed by
the Board of Directors.
CLASSIFIED BOARD OF DIRECTORS AND ABSENCE OF CUMULATIVE VOTING
Regions. Regions' certificate of incorporation provides that Regions' Board
of Directors is divided into three classes, with each class to be as nearly
equal in number as possible. The directors in each class serve three-year terms
of office.
The effect of Regions having a classified Board of Directors is that only
approximately one-third of the members of the Board are elected each year;
consequently, two annual meetings are effectively required for Regions'
stockholders to change a majority of the members of the Board.
Pursuant to Regions' certificate of incorporation, each stockholder
generally is entitled to one vote for each share of Regions stock held and is
not entitled to cumulative voting rights in the election of directors. With
cumulative voting, a stockholder has the right to cast a number of votes equal
to the total number of such holder's shares multiplied by the number of
directors to be elected. The stockholder has the right to cast all of such
holder's votes in favor of one candidate or to distribute such holder's votes in
any manner among any number of candidates. Directors are elected by a plurality
of the total votes cast by all stockholders. With cumulative voting, it may be
possible for minority stockholders to obtain representation on the Board of
Directors. Without cumulative voting, the holders of more than 50% of the shares
of Regions common stock generally have the ability to elect 100% of the
directors. As a result, the holders of the remaining Regions common stock
effectively may not be able to elect any person to the Board of Directors. The
absence of cumulative voting, therefore, could make it more difficult for a
stockholder who acquires less than a majority of the shares of Regions common
stock to obtain representation on Regions' Board of Directors.
Minden Bancshares. Minden Bancshares' articles do not provide for a
classified board of directors, and prohibit cumulative voting rights.
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<PAGE> 40
REMOVAL OF DIRECTORS
Regions. Under Regions' certificate of incorporation, any director or the
entire Board of Directors may be removed only for cause and only by the
affirmative vote of the holders of at least 75% of Regions' voting stock.
Minden Bancshares. The Louisiana Business Corporation Law permits
stockholders to remove any director, with or without cause, by vote of a
majority of the total voting power at any special meeting called for that
purpose. Minden Bancshares' bylaws provide that at a special meeting of
stockholders called expressly for that purpose, any directors or the entire
board of directors may be removed with or without cause by a vote of the
majority of shares entitled to vote in an election of directors.
LIMITATIONS ON DIRECTOR LIABILITY
Regions. Regions' certificate of incorporation provides that a director of
Regions will have no personal liability to Regions or its stockholders for
monetary damages for breach of fiduciary duty as a director, except for
liability for (1) any breach of the director's duty of loyalty to the
corporation or its stockholders, (2) acts or omissions not in good faith or that
involve intentional misconduct or a knowing violation of law, (3) the payment of
certain unlawful dividends and the making of certain unlawful stock purchases or
redemptions, or (4) any transaction from which the director derived an improper
personal benefit.
Although this provision does not affect the availability of injunctive or
other equitable relief as a remedy for a breach of duty by a director, it does
limit the remedies available to a stockholder who has a valid claim that a
director acted in violation of such director's duties, if the action is among
those as to which liability is limited. This provision may reduce the likelihood
of stockholder derivative litigation against directors and may discourage or
deter stockholders or management from bringing a lawsuit against directors for
breach of their duties, even though such action, if successful, might have
benefited Regions and its stockholders. The SEC has taken the position that
similar provisions added to other corporations' certificates of incorporation
would not protect those corporations' directors from liability for violations of
the federal securities laws.
Minden Bancshares. The Minden Bancshares articles contain a comparable
provision which operates to relieve a director from monetary liability for
breach of fiduciary duty as a director, except for liability based on standards
of conduct substantially identical the standards described pertaining to
Regions.
INDEMNIFICATION
Regions. Regions' certificate of incorporation provides that Regions will
indemnify its officers, directors, employees, and agents to the fullest extent
permitted by the Delaware General Corporation Law. Under Section 145 of the
Delaware General Corporation Law as currently in effect, other than in actions
brought by or in the right of Regions, such indemnification would apply if it
were determined in the specific case that the proposed indemnitee acted in good
faith and in a manner such person reasonably believed to be in or not opposed to
the best interests of Regions and, with respect to any criminal proceeding, if
such person had no reasonable cause to believe that the conduct was unlawful. In
actions brought by or in the right of Regions, such indemnification probably
would be limited to reasonable expenses (including attorneys' fees) and would
apply if it were determined in the specific case that the
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<PAGE> 41
proposed indemnitee acted in good faith and in a manner such person reasonably
believed to be in or not opposed to the best interests of Regions, except that
no indemnification may be made with respect to any matter as to which such
person is adjudged liable to Regions, unless, and only to the extent that, the
court determines upon application that, in view of all the circumstances of the
case, the proposed indemnitee is fairly and reasonably entitled to
indemnification for such expenses as the court deems proper. To the extent that
any director, officer, employee, or agent of Regions has been successful on the
merits or otherwise in defense of any action, suit, or proceeding, as discussed
herein, whether civil, criminal, administrative, or investigative, such person
must be indemnified against reasonable expenses incurred by such person in
connection therewith.
Minden Bancshares. Minden Bancshares' articles provide for discretionary
indemnification of its directors and officers. The Louisiana Business
Corporation Law permits, but does not require, indemnification of employees and
agents who meet specified standards of conduct except that indemnification of
directors, officers, employees, and agents is mandatory, as is the case and to
the same extent as under the Delaware General Corporation Law described above,
whenever any such person has been successful in the defense of a claim.
SPECIAL MEETINGS OF STOCKHOLDERS
Regions. Regions' certificate of incorporation and bylaws provide that
special meetings of stockholders may be called at any time, but only by the
chief executive officer, the secretary, or the Board of Directors of Regions.
Regions stockholders do not have the right to call a special meeting or to
require that Regions' Board of Directors call such a meeting. This provision,
combined with other provisions of the Certificate and the restriction on the
removal of directors, would prevent a substantial stockholder from compelling
stockholder consideration of any proposal (such as a proposal for a business
combination) over the opposition of Regions' Board of Directors by calling a
special meeting of stockholders at which such stockholder could replace the
entire Board with nominees who were in favor of such proposal.
Minden Bancshares. Under the Louisiana Business Corporation Law, a special
meeting of stockholders may be called by stockholders holding at least 20% of
its voting power. Minden Bancshares' bylaws provide that a special meeting of
stockholders may also be called by the president or the Board of Directors, and
provide further that only such business may be conducted at a special meeting as
stated or indicated in the notice of the special meeting.
ACTIONS BY STOCKHOLDERS WITHOUT A MEETING
Regions. Regions' certificate of incorporation provides that any action
required or permitted to be taken by Regions stockholders must be effected at a
duly called meeting of stockholders and may not be effected by any written
consent by the stockholders. These provisions would prevent stockholders from
taking action, including action on a business combination, except at an annual
meeting or special meeting called by the Board of Directors, chief executive
officer, or secretary, even if a majority of the stockholders were in favor of
such action.
Minden Bancshares. Under the Louisiana Business Corporation Law, action
requiring or permitting stockholder approval may be approved by written consent
of all stockholders entitled to vote at a meeting of stockholders. In that it
would be impractical to obtain the consent of all stockholders, the inability of
stockholders to effect action without a meeting is substantially the same as for
Regions.
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STOCKHOLDER NOMINATIONS
Regions. Regions' certificate of incorporation and bylaws provide that any
nomination by stockholders of individuals for election to the Board of Directors
must be made by delivering written notice of such nomination to the Secretary of
Regions not less than 14 days nor more than 50 days before any meeting of the
stockholders called for the election of directors; provided, however, that if
less than 21 days notice of the meeting is given to stockholders, the nomination
notice must be delivered to the Secretary of Regions not later than the seventh
day following the day on which notice of the meeting was mailed to stockholders.
The nomination notice must set forth certain background information about the
persons to be nominated, including information concerning (1) the name, age,
business, and, if known, residential address of each nominee, (2) the principal
occupation or employment of each such nominee, and (3) the number of shares of
Regions capital stock beneficially owned by each such nominee. The Board of
Directors is not required to nominate in the annual proxy statement any person
so proposed; however, compliance with this procedure would permit a stockholder
to nominate the individual at the stockholders' meeting, and any stockholder may
vote such holder's shares in person or by proxy for any individual such holder
desires.
Minden Bancshares. Minden Bancshares' Bylaws provide that a stockholder
wishing to make a proposal or nominate a person as director at an annual meeting
must give 60 days advance written notice to the president by registered or
certified mail.
MERGERS, CONSOLIDATIONS, AND SALES OF ASSETS GENERALLY
Regions. Regions' certificate of incorporation generally requires the
affirmative vote of the holders of at least 75% of the outstanding voting stock
of Regions to effect (1) any merger or consolidation with or into any other
corporation, or (2) any sale or lease of any substantial part of the assets of
Regions to any party that beneficially owns 5.0% or more of the outstanding
shares of Regions voting stock, unless the transaction was approved by Regions'
Board of Directors before the other party became a 5.0% beneficial owner or is
approved by 75% or more of the Board of Directors after the party becomes such a
5.0% beneficial owner. In addition, the Delaware General Corporation Law
generally requires the approval of a majority of the outstanding voting stock of
Regions to effect (1) any merger or consolidation with or into any other
corporation, (2) any sale, lease, or exchange of all or substantially all of
Regions property and assets, or (3) the dissolution of Regions. However,
pursuant to the Delaware General Corporation Law, Regions may enter into a
merger transaction without stockholder approval if (1) Regions is the surviving
corporation, (2) the agreement of merger does not amend in any respect Regions'
certificate of incorporation, (3) each share of Regions stock outstanding
immediately prior to the effective date of the merger is to be an identical
outstanding or treasury share of Regions after the effective date of the merger,
and (4) either no shares of Regions common stock and no shares, securities, or
obligations convertible into such stock are to be issued or delivered under the
plan of merger, or the authorized unissued shares or the treasury shares of
Regions common stock to be issued or delivered under the plan of merger plus
those initially issuable upon conversion of any other shares, securities, or
obligations to be issued or delivered under such plan do not exceed 20% of the
shares of Regions common stock outstanding immediately prior to the effective
date of the merger.
Minden Bancshares. The Louisiana Business Corporation Law generally
requires the affirmative vote of at least two-thirds of the voting power
present, or by such larger or smaller vote, but not less than a majority of the
voting power present or of the total voting power, as the articles of
incorporation may prescribe, to effect (1) any merger, consolidation, or share
exchange with or into any other corporation, or
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(2) any sale or lease of all or substantially all of the assets of the
corporation if the corporation is not insolvent. Minden Bancshares' articles and
bylaws do not establish a different voting requirment.
BUSINESS COMBINATIONS WITH CERTAIN PERSONS
Regions. Section 203 of the Delaware General Corporation Law places certain
restrictions on "business combinations" (as defined in Section 203 to include,
generally, mergers, sales and leases of assets, issuances of securities, and
similar transactions) by Delaware corporations with an "interested stockholder"
(as defined in Section 203 to include, generally, the beneficial owner of 15% or
more of the corporation's outstanding voting stock). Section 203 generally
applies to Delaware corporations, such as Regions, that have a class of voting
stock listed on a national securities exchange, authorized for quotation on an
interdealer quotation system of a registered national securities association, or
held of record by more than 2,000 stockholders, unless the corporation expressly
elects in its certificate of incorporation or bylaws not to be governed by
Section 203.
Regions has not specifically elected to avoid the application of Section
203. As a result, Section 203 generally would prohibit a business combination by
Regions or a subsidiary with an interested stockholder within three years after
the person or entity becomes an interested stockholder, unless (1) prior to the
time when the person or entity becomes an interested stockholder, Regions' Board
of Directors approved either the business combination or the transaction
pursuant to which such person or entity became an interested stockholder, (2)
upon consummation of the transaction in which the person or entity became an
interested stockholder, the interested stockholder held at least 85% of the
outstanding Regions voting stock (excluding shares held by persons who are both
officers and directors and shares held by certain employee benefit plans), or
(3) once the person or entity becomes an interested stockholder, the business
combination is approved by Regions' Board of Directors and by the holders of at
least two-thirds of the outstanding Regions voting stock, excluding shares owned
by the interested stockholder.
Minden Bancshares. Section 133 of the Louisiana Business Corporation Law
places similar restrictions on "business combinations" (as defined in Section
132(4) of the Louisiana Business Corporation Law, generally including mergers,
consolidations, share exchanges, sales and leases of assets, issuances of
securities, and similar transactions) by Louisiana corporations with an
"interested stockholder" (as defined in Section 132(9) of the Louisiana Business
Corporation Law, generally the beneficial owner of 10% or more of the voting
power of the then outstanding voting stock). Section 133 generally applies to
business combinations of Louisiana corporations having greater than 100
beneficial owners of its stock or which did not have an interested stockholder
on January 1, 1985, unless the articles of incorporation expressly provide
otherwise. Section 133 generally does not apply if specified conditions are met,
including a condition that the stockholders receive in the business combination
consideration for their shares of stock in the corporation that is no less than
the highest of several different standards provided for by Section 134B, one of
which is that the price must be no less than the highest price as the interested
stockholder paid for shares of stock in the corporation acquired by such
interested stockholder within two years of such business combination.
As Minden Bancshares has not generally elected to avoid the application of
Section 133, Section 133 generally would prohibit a business combination by
Minden Bancshares with an interested stockholder unless the consideration to be
received meets the standard described in the preceding sentence or unless
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the business combination is recommended by Minden Bancshares' Board and approved
by the affirmative vote of at least each of the following: (1) 80% of the votes
entitled to be cast by outstanding shares of Minden Bancshares voting stock
voting together as a single voting group and (2) two-thirds of the votes
entitled to be cast by holders of Minden Bancshares voting stock, other than
voting stock held by the interested stockholder who is a party to the business
combination with Minden Bancshares, voting together as a single voting group. As
Regions is not an "interested stockholder" with respect to Minden Bancshares,
Section 133 does not apply to the merger.
Under Sections 135 through 140.2 of the Louisiana Business Corporation Law
(the "Control Share Law"), a person who acquires shares in certain Louisiana
corporations (including Minden Bancshares) and as a result increases such
person's voting power in the corporation to or above any of three threshold
levels (i.e., 20%, 33 1/3%, and 50%), acquires the voting rights with respect to
such shares only to the extent granted by a majority in voting interest of the
pre-existing, disinterested stockholders of the corporation. Certain
acquisitions of shares are exempted from the provisions of the Control Share
Law, including acquisitions pursuant to a merger, consolidation, or share
exchange agreement to which the corporation is a party. Since Regions'
acquisition of Minden Bancshares common stock is to be made pursuant to a merger
and Minden Bancshares and Regions are parties to the merger agreement with
respect thereto, the Control Share Law does not apply to the merger.
DISSENTERS' RIGHTS
Regions. The rights of dissenting stockholders of Regions are governed by
the Delaware General Corporation Law. Pursuant thereto, except as described
below, any stockholder has the right to dissent from any merger of which Regions
could be a constituent corporation. No appraisal rights are available, however,
for (1) the shares of any class or series of stock that is either listed on a
national securities exchange, quoted on the Nasdaq National Market, or held of
record by more than 2,000 stockholders or (2) any shares of stock of the
constituent corporation surviving a merger if the merger did not require the
approval of the surviving corporation's stockholders, unless, in either case,
the holders of such stock are required by an agreement of merger or
consolidation to accept for that stock something other than: (a) shares of stock
of the corporation surviving or resulting from the merger or consolidation; (b)
shares of stock of any other corporation that will be listed at the effective
date of the merger on a national securities exchange, quoted on the Nasdaq
National Market, or held of record by more than 2,000 stockholders; (c) cash in
lieu of fractional shares of stock described in clause (a) or (b) immediately
above; or (d) any combination of the shares of stock and cash in lieu of
fractional shares described in clauses (a) through (c) immediately above.
Because Regions common stock is quoted on the Nasdaq National Market and is held
of record by more than 2,000 stockholders, unless the exception described
immediately above applies, holders of Regions common stock do not have
dissenters' rights.
Minden Bancshares. The rights of dissenting stockholders under Louisiana
law are generally similar to those afforded under the Delaware General
Corporation Law. See "The Merger--Dissenting Stockholders" on page 25. If the
merger is consummated, stockholders of Minden Bancshares will have dissenters'
rights as there described unless the merger receives the favorable vote of at
least 80% of the total outstanding shares.
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STOCKHOLDERS' RIGHTS TO EXAMINE BOOKS AND RECORDS
Regions. The Delaware General Corporation Law provides that a stockholder
may inspect books and records upon written demand under oath stating the purpose
of the inspection, if such purpose is reasonably related to such person's
interest as a stockholder.
Minden Bancshares. Pursuant to the Louisiana Business Corporation Law, upon
written notice of a demand to inspect corporate records, one or more
stockholders who have owned at least 2% of the outstanding stock (25% in the
case of a business competitor) for at least six months are entitled to inspect
specified corporate records.
DIVIDENDS
Regions. The Delaware General Corporation Law provides that, subject to any
restrictions in the corporation's certificate of incorporation, dividends may be
declared from the corporation's surplus, or, if there is no surplus, from its
net profits for the fiscal year in which the dividend is declared and the
preceding fiscal year. Dividends may not be declared, however, if the
corporation's capital has been diminished to an amount less than the aggregate
amount of all capital represented by the issued and outstanding stock of all
classes having a preference upon the distribution of assets. Substantially all
of the funds available for the payment of dividends by Regions are derived from
its subsidiary depository institutions. There are various statutory limitations
on the ability of Regions' subsidiary depository institutions to pay dividends
to Regions. See "Certain Regulatory Considerations--Payment of Dividends."
Minden Bancshares. Pursuant to the Louisiana Business Corporation Law, a
board of directors may from time to time make distributions out of surplus, as
defined in the Louisiana Business Corporation Law, to its stockholders, subject
to restrictions in its articles of incorporation, except (1) when the
corporation is insolvent, or (2) at a time when the corporation's assets are
exceeded by its liabilities, or when the net assets are less than the aggregate
amount payable on liquidation to any shares of Minden Bancshares stock which
have preferential rights in the event of liquidation. Substantially all of the
funds available for the payment of dividends by Minden Bancshares are derived
from Minden Bank & Trust, which is subject to federal and state statutory
limitations on its ability to pay dividends. See "Comparative Market Prices And
Dividends" and "Supervision and Regulation--Payment of Dividends" on page 44.
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COMPARATIVE MARKET PRICES AND DIVIDENDS
Regions common stock is quoted on the Nasdaq National Market under the
symbol "RGBK." Minden Bancshares common stock is not traded in any established
market. The following table sets forth, for the indicated periods, the high and
low closing sale prices for Regions common stock as reported on the Nasdaq
National Market, the high and low prices, to the extent known by management of
Minden Bancshares, for Minden Bancshares common stock and the cash dividends
declared per share of Regions common stock and Minden Bancshares common stock
for the indicated periods. The prices indicated for Minden Bancshares are based
on actual transactions in Minden Bancshares common stock of which Minden
Bancshares management is aware; however, for the indicated period there has been
only a very limited number of transactions and all such transactions have
involved limited numbers of shares in Minden Bancshares common stock in the
indicated periods, and no assurance can be given that the indicated prices
represent the actual market value of the Minden Bancshares common stock. The
amounts indicated for Regions have been adjusted to reflect a 2-for-1 stock
split effected by Regions on June 13, 1997.
<TABLE>
<CAPTION>
REGIONS MINDEN BANCSHARES
PRICE RANGE CASH DIVIDENDS PRICE RANGE CASH DIVIDENDS
------------ DECLARED --------------- DECLARED
HIGH LOW PER SHARE HIGH LOW PER SHARE
---- --- -------------- ---- --- --------------
<S> <C> <C> <C> <C> <C> <C>
1997
First Quarter................. $30.94 $25.69 $.20 $100.00 $100.00 $ --
Second Quarter................ 33.25 27.38 .20 -- -- .75
Third Quarter................. 39.13 32.06 .20 120.00 120.00 --
Fourth Quarter................ 44.75 36.56 .20 125.00 102.98 3.25
1998
First Quarter ................ 43.50 37.94 .23 112.90 112.90 --
Second Quarter................ 45.25 38.66 .23 120.00 120.00 .85
Third Quarter ................ 42.69 33.81 .23 110.00 106.00 --
Fourth Quarter ............... 40.69 30.75 .23 110.00 110.00 4.15
1999
First Quarter ................ 41.44 34.63 .25 127.27 125.00 --
Second Quarter................ 39.13 34.72 .25 -- -- 1.00
Third Quarter ................ 38.94 29.81 .25 125.00 125.00 --
Fourth Quarter (through
_______, 1999) ........... 7.00
</TABLE>
On _______, 1999, the last reported sale price of Regions common stock as
reported on the Nasdaq National Market was $ _______ , and the price of Minden
Bancshares common stock in the last known transaction, which occurred in
_______, was $ _______. On July 15, 1999, the last business day prior to public
announcement of the proposed merger, the last reported sale price of Regions
common stock as reported on the Nasdaq National Market was $36.78, and the last
known price of Minden Bancshares common stock was $125.00.
The holders of Regions common stock are entitled to receive dividends when
and if declared by the Board of Directors out of funds legally available
therefor. Regions has paid regular quarterly cash dividends since 1971. Although
Regions currently intends to continue to pay quarterly cash dividends on
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the Regions common stock, there can be no assurance that Regions' dividend
policy will remain unchanged after completion of the merger. The declaration and
payment of dividends thereafter will depend upon business conditions, operating
results, capital and reserve requirements, and the Board of Directors'
consideration of other relevant factors.
The holders of Minden Bancshares common stock are entitled to receive
dividends when and if declared by the Board of Directors out of funds legally
available therefor. Minden Bancshares has paid regularly semi-annual cash
dividends since its acquisition of Minden Bank in 1985 and Minden Bank regularly
paid semi-annual dividends to its shareholders for at least 20 consecutive years
prior to 1985. It is the present intention of Minden Bancshares' Board of
Directors to continue the dividend payments; however, future dividends must
necessarily depend on earnings, financial condition, appropriate legal
restrictions and other factors relevant at the time the Board of Directors
considers its dividend policy.
Minden Bancshares is a legal entity separate and distinct from its
subsidiary, Minden Bank & Trust Company, and its revenues depend solely upon its
subsidiary. Minden Bank & Trust Company is subject to certain legal restrictions
on the amount of dividends that it is permitted to pay. See "Supervision and
Regulation--Payment of Dividends."
Regions and Minden Bancshares are legal entities separate and distinct from
their subsidiaries and their revenues depend in significant part on the payment
of dividends from their subsidiary financial institutions. Their subsidiary
depository institutions are subject to certain legal restrictions on the amount
of dividends they are permitted to pay. See "Supervision and Regulation--Payment
of Dividends."
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<PAGE> 48
INFORMATION ABOUT MINDEN BANCSHARES
Minden Bancshares is a bank holding company organized under the laws of the
state of Louisiana with its principal executive office located in Minden,
Louisiana. Minden Bancshares operates principally through Minden Bank, which is
a state-chartered commercial bank and which provides a range of consumer and
commercial banking services through its main office in Minden, Louisiana and
seven branch offices in Webster and Caddo Parishes. At September 30, 1999,
Minden Bancshares had total consolidated assets of approximately $327 million,
total consolidated deposits of approximately $277 million, and total
consolidated stockholders' equity of approximately $39 million. Minden
Bancshares' principal executive office is located at 401 Main Street, Minden,
Louisiana, 71055 and its telephone number at such address is (318) 377-4283.
Additional information with respect to Minden Bancshares and Minden Bank &
Trust is included in documents incorporated by reference in this Proxy
Statement-Prospectus. Copies of such documents, including Minden Bancshares'
Annual Report on Form 10-KSB for the fiscal year ended December 31, 1998, as
amended, and Minden Bancshares' Quarterly Reports on Form 10-QSB for the
quarters ended March 31, June 30, and September 30, 1999, accompany this Proxy
Statement-Prospectus.
VOTING SECURITIES AND PRINCIPAL STOCKHOLDERS OF MINDEN BANCSHARES
The following table sets forth certain information concerning the
beneficial owners of more than 5.0% of Minden Bancshares common stock, as of the
record date.
<TABLE>
<CAPTION>
NAME AND ADDRESS AMOUNT AND NATURE PERCENT OF
TITLE OF CLASS OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP CLASS (1)
- -------------- ------------------- -------------------- ----------
<S> <C> <C> <C>
Common Stock Harry E. McInnis, Jr. 16,089 5.73%
$2.50 Par Value P.O. Box 1114
Minden, LA 71058
</TABLE>
(1) The information shown above is based upon information furnished by the
named persons. Information relating to beneficial ownership is based upon
"beneficial ownership" concepts set forth in rules promulgated under the
Securities Exchange Act of 1934. Under such rules a person is deemed to be
a "beneficial owner" of a security if that person has or shares "voting
power," which includes the power to vote or to direct the voting of such
security, or "investment power," which includes the power to dispose or to
direct the disposition of such security. A person is also deemed to be a
beneficial owner of any security of which that person has the right to
acquire beneficial ownership within 60 days. Under the rules, more than one
person may be deemed to be a beneficial owner of the same securities, and a
person may be deemed to be a beneficial owner of securities as to which he
or she has no beneficial interest.
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<PAGE> 49
INFORMATION ABOUT REGIONS
GENERAL
Regions is a regional bank holding company organized and existing under the
laws of the state of Delaware and headquartered in Birmingham, Alabama, with
approximately 742 banking offices located in Alabama, Arkansas, Florida,
Georgia, Louisiana, South Carolina, Tennessee, and Texas as of September 30,
1999. At that date, Regions had total consolidated assets of approximately $41.2
billion, total consolidated deposits of approximately $29.8 billion, and total
consolidated stockholders' equity of approximately $3.0 billion. Regions has
banking-related subsidiaries engaged in mortgage banking, credit life insurance,
leasing, and securities brokerage activities with offices in various
Southeastern states. Through its subsidiaries, Regions offers a broad range of
banking and banking-related services.
Regions was organized under the laws of the state of Delaware and commenced
operations in 1971 under the name First Alabama Bancshares, Inc. In 1994, the
name of First Alabama Bancshares, Inc. was changed to Regions Financial
Corporation. Regions' principal executive offices are located at 417 North 20th
Street, Birmingham, Alabama 35203, and its telephone number at such address is
(205) 944-1300.
Regions continually evaluates business combination opportunities and
frequently conducts due diligence activities in connection with possible
business combinations. As a result, business combination discussions and, in
some cases, negotiations frequently take place, and future business combinations
involving cash, debt, or equity securities can be expected. Any future business
combination or series of business combinations that Regions might undertake may
be material, in terms of assets acquired or liabilities assumed, to Regions'
financial condition. Recent business combinations in the banking industry have
typically involved the payment of a premium over book and market values. This
practice could result in dilution of book value and net income per share for the
acquirer.
Additional information about Regions and its subsidiaries is included in
documents incorporated by reference in this Proxy Statement-Prospectus. See
"Where You Can Find More Information" on page 50.
RECENT DEVELOPMENTS
Since December 31, 1998, and as of the date of this Proxy
Statement-Prospectus, Regions has completed the acquisitions of four financial
institutions and has entered into a definitive agreement to acquire one
financial institution in addition to the merger. Certain aspects of the
completed and other pending acquisitions are presented in the following table:
42
<PAGE> 50
<TABLE>
<CAPTION>
CONSIDERATION
-------------
APPROXIMATE
-----------
ACCOUNTING
INSTITUTION ASSET SIZE(1) VALUE(1) TYPE TREATMENT
----------- ------------- -------- ---- ----------
(In millions)
<S> <C> <C> <C> <C>
Recently Completed Acquisitions:
Meigs County Bancshares, Inc. located in Decatur, Tennessee $ 114 $ 20 Regions Pooling
Common of
Stock Interests
Bullsboro BancShares, Inc., located in Newnan, Georgia 101 34 Regions Pooling
Common of
Stock Interests
VB&T Bancshares Corporation, located in Valdosta, Georgia 76 19 Regions Pooling
Common of
Stock Interests
Arkansas Banking Company, located in Jonesboro, Arkansas 355 58 Regions Purchase
Common
Stock
Other Pending Acquisitions:
LCB Corporation, located in Fayetteville, Tennessee 175 47 Regions Purchase
Common
Stock
</TABLE>
- ---------------
(1) Calculated as of the date of consummation in the case of the completed
acquisitions and as of the date of announcement of the transaction in the
case of pending acquisitions.
Consummation of the other pending acquisitions is subject to the approval
of certain regulatory agencies and approval of the stockholders of the
institutions to be acquired. Moreover, the closing of each transaction is
subject to various contractual conditions precedent. No assurance can be given
that the conditions precedent to consummating the transactions will be satisfied
in a manner that will result in their consummation.
If the other pending acquisitions and the merger had been consummated on
September 30, 1999, as of that date Regions' total consolidated assets would
have been increased by approximately $550 million to approximately $41.8
billion; its total consolidated deposits would have increased by approximately
$431 million to approximately $30.2 billion; and its total consolidated
stockholders' equity would have increased by approximately $104 million to
approximately $3.1 billion.
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<PAGE> 51
SUPERVISION AND REGULATION
The following discussion sets forth certain of the material elements of the
regulatory framework applicable to banks and bank holding companies and provides
certain specific information related to Regions and Minden Bancshares.
Additional information is available in Regions' Annual Report on Form 10-K for
the fiscal year ended December 31, 1998. See "Where You Can Find More
Information" on page 50.
GENERAL
Regions and Minden Bancshares are both bank holding companies registered
with the Board of Governors of the Federal Reserve System under the Bank Holding
Company Act. As such, Regions and Minden Bancshares and their non-bank
subsidiaries are subject to the supervision, examination, and reporting
requirements of the Bank Holding Company Act and the regulations of the Federal
Reserve Board.
The Bank Holding Company Act requires every bank holding company to obtain
the prior approval of the Federal Reserve Board before: (1) it may acquire
direct or indirect ownership or control of any voting shares of any bank if,
after such acquisition, the bank holding company will directly or indirectly own
or control more than 5.0% of the voting shares of the bank; (2) it or any of its
subsidiaries, other than a bank, may acquire all or substantially all of the
assets of any bank; or (3) it may merge or consolidate with any other bank
holding company.
The Bank Holding Company Act further provides that the Federal Reserve
Board may not approve any transaction that would result in a monopoly or would
be in furtherance of any combination or conspiracy to monopolize or attempt to
monopolize the business of banking in any section of the United States, or the
effect of which may be substantially to lessen competition or to tend to create
a monopoly in any section of the country, or that in any other manner would be
in restraint of trade, unless the anticompetitive effects of the proposed
transaction are clearly outweighed by the public interest in meeting the
convenience and needs of the community to be served. The Federal Reserve Board
is also required to consider the financial and managerial resources and future
prospects of the bank holding companies and banks concerned and the convenience
and needs of the community to be served.
The Bank Holding Company Act generally prohibits Regions and Minden
Bancshares from engaging in activities other than banking or managing or
controlling banks or other permissible subsidiaries and from acquiring or
retaining direct or indirect control of any company engaged in any activities
other than those activities determined by the Federal Reserve Board to be so
closely related to banking or managing or controlling banks as to be a proper
incident thereto. In determining whether a particular activity is permissible,
the Federal Reserve Board must consider whether the performance of such an
activity reasonably can be expected to produce benefits to the public, such as
greater convenience, increased competition, or gains in efficiency, that
outweigh possible adverse effects, such as undue concentration of resources,
decreased or unfair competition, conflicts of interest, or unsound banking
practices. Each of the subsidiary banks of Regions and Minden Bancshares is a
member of the Federal Deposit Insurance Corporation (the "FDIC"), and as such,
its deposits are insured by the FDIC to the extent provided by law. Each such
subsidiary bank is also subject to numerous state and federal statutes and
regulations that
44
<PAGE> 52
affect its business, activities, and operations, and each is supervised and
examined by one or more state or federal bank regulatory agencies.
Minden Bank & Trust and all of Regions' subsidiary banks that are
state-chartered banks are subject to supervision and examination by the FDIC and
the state banking authorities of the states in which they are located. Regions'
subsidiary banks that are nationally chartered are subject to regulation,
supervision, and examination by the OCC and the FDIC. The federal banking
regulator for each of the subsidiary banks, as well as the appropriate state
banking authority for each of the subsidiary banks that is a state chartered
bank, regularly examines the operations of the subsidiary banks and is given
authority to approve or disapprove mergers, consolidations, the establishment of
branches, and similar corporate actions. The federal and state banking
regulators also have the power to prevent the continuance or development of
unsafe or unsound banking practices or other violations of law.
PAYMENT OF DIVIDENDS
Regions and Minden Bancshares are legal entities separate and distinct from
their banking and other subsidiaries. The principal sources of cash flow of both
Regions and Minden Bancshares, including cash flow to pay dividends to their
respective stockholders, are dividends from their subsidiary banks. There are
statutory and regulatory limitations on the payment of dividends by these
subsidiary banks to Regions and Minden Bancshares, as well as by Regions and
Minden Bancshares to their stockholders.
As to the payment of dividends, the Bank and all of Regions'
state-chartered banking subsidiaries are subject to the respective laws and
regulations of the state in which the bank is located, and to the regulations of
the FDIC.
If, in the opinion of a federal banking regulatory agency, an institution
under its jurisdiction is engaged in or is about to engage in an unsafe or
unsound practice (which, depending on the financial condition of the depository
institution, could include the payment of dividends), such agency may require,
after notice and hearing, that such institution cease and desist from such
practice. The federal banking agencies have indicated that paying dividends that
deplete an institution's capital base to an inadequate level would be an unsafe
and unsound banking practice. Under current federal law, an insured institution
may not pay any dividend if payment would cause it to become undercapitalized or
if it already is undercapitalized. See "--Prompt Corrective Action." Moreover,
the Federal Reserve Board and the FDIC have issued policy statements which
provide that bank holding companies and insured banks should generally pay
dividends only out of current operating earnings.
At September 30, 1999, under dividend restrictions imposed under federal
and state laws, the subsidiary banks of Regions and Minden Bancshares, without
obtaining governmental approvals, could declare aggregate dividends to the
parent company of $309 million in the case of Regions and $8 million in the case
of Minden Bancshares.
The payment of dividends by Regions and Minden Bancshares and their
subsidiary banks may also be affected or limited by other factors, such as the
requirement to maintain adequate capital above regulatory guidelines.
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<PAGE> 53
CAPITAL ADEQUACY
Regions, Minden Bancshares, and their respective subsidiary banks are
required to comply with the capital adequacy standards established by the
Federal Reserve Board in the case of Regions and Minden Bancshares, and the FDIC
or the OCC in the case of each of their subsidiary banks. There are two basic
measures of capital adequacy for bank holding companies that have been
promulgated by the Federal Reserve Board: a risk-based measure and a leverage
measure. All applicable capital standards must be satisfied for a bank holding
company to be considered in compliance.
The risk-based capital standards are designed to make regulatory capital
requirements more sensitive to differences in risk profile among banks and bank
holding companies, to account for off-balance-sheet exposure, and to minimize
disincentives for holding liquid assets. Assets and off-balance sheet items are
assigned to broad risk categories, each with appropriate weights. The resulting
capital ratios represent capital as a percentage of total risk-weighted assets
and off-balance sheet items.
The minimum guideline for the ratio of total capital ("Total Capital") to
risk-weighted assets (including certain off-balance-sheet items, such as standby
letters of credit) is 8.0%. At least half of the Total Capital must be composed
of common equity, undivided profits, minority interests in the equity accounts
of consolidated subsidiaries, qualifying noncumulative perpetual preferred
stock, and a limited amount of cumulative perpetual preferred stock, less
goodwill and certain other intangible assets ("Tier 1 Capital"). The remainder
may consist of certain subordinated debt, other preferred stock, and a limited
amount of loan loss reserves. The minimum guideline for Tier 1 Capital is 4.0%
of risk-weighted assets. At September 30, 1999, Regions' consolidated Total
Capital Ratio was 11.17% and its Tier 1 Capital Ratio (i.e., the ratio of Tier
1 Capital to risk-weighted assets) was 9.42%, and Minden Bancshares'
consolidated Total Capital Ratio was 23.22% and its Tier 1 Capital Ratio was
21.96%.
In addition, the Federal Reserve Board has established minimum leverage
ratio guidelines for bank holding companies. These guidelines provide for a
minimum ratio of Tier 1 Capital to average assets, less goodwill and certain
other intangible assets (the "Leverage Ratio"), of 3.0% for bank holding
companies that meet certain specified criteria, including having the highest
regulatory rating. All other bank holding companies generally are required to
maintain a Leverage Ratio of at least 3.0%, plus an additional cushion of 100 to
200 basis points above the stated minimums. The guidelines also provide that
bank holding companies experiencing internal growth or making acquisitions will
be expected to maintain strong capital positions substantially above the minimum
supervisory levels without significant reliance on intangible assets.
Furthermore, the Federal Reserve Board has indicated that it will consider a
"tangible Tier 1 Capital leverage ratio" (deducting all intangibles) and other
indicators of capital strength in evaluating proposals for expansion or new
activities. At September 30, 1999 Regions' Leverage Ratio was 6.67% and
Minden Bancshares' Leverage Ratio was 11.19%.
Each of Regions' and Minden Bancshares' subsidiary banks is subject to
risk-based and leverage capital requirements adopted by the FDIC or the OCC,
which are substantially similar to those adopted by the Federal Reserve Board.
Each of the subsidiary banks was in compliance with applicable minimum capital
requirements as of September 30, 1999. Neither Regions, Minden Bancshares, nor
any of their subsidiary banks has been advised by any federal banking agency of
any specific minimum capital ratio requirement applicable to it.
Failure to meet capital guidelines could subject a bank to a variety of
enforcement remedies, including issuance of a capital directive, the termination
of deposit insurance by the FDIC, a prohibition
46
<PAGE> 54
on the taking of brokered deposits, and to certain other restrictions on its
business. As described below, substantial additional restrictions can be imposed
upon FDIC-insured depository institutions that fail to meet applicable capital
requirements. See "--Prompt Corrective Action."
PROMPT CORRECTIVE ACTION
Current federal law establishes a system of prompt corrective action to
resolve the problems of undercapitalized institutions. Under this system the
federal banking regulators have established five capital categories ("well
capitalized," "adequately capitalized," "undercapitalized," "significantly
undercapitalized," and "critically undercapitalized") and must take certain
mandatory supervisory actions, and are authorized to take other discretionary
actions, with respect to institutions in the three undercapitalized categories,
the severity of which will depend upon the capital category in which the
institution is placed. Generally, subject to a narrow exception, current federal
law requires the banking regulator to appoint a receiver or conservator for an
institution that is critically undercapitalized. The federal banking agencies
have specified by regulation the relevant capital level for each category.
Under the final agency rule implementing the prompt corrective action
provisions, an institution that (1) has a Total Capital ratio of 10% or greater,
a Tier 1 Capital ratio of 6.0% or greater, and a Leverage Ratio of 5.0% or
greater and (2) is not subject to any written agreement, order, capital
directive, or prompt corrective action directive issued by the appropriate
federal banking agency is deemed to be "well capitalized." An institution with a
Total Capital ratio of 8.0% or greater, a Tier 1 Capital ratio of 4.0% or
greater, and a Leverage Ratio of 4.0% or greater is considered to be "adequately
capitalized." A depository institution that has a Total Capital ratio of less
than 8.0%, a Tier 1 Capital ratio of less than 4.0%, or a Leverage Ratio of less
than 4.0% is considered to be "undercapitalized." A depository institution that
has a Total Capital ratio of less than 6.0%, a Tier 1 Capital ratio of less than
3.0%, or a Leverage Ratio of less than 3.0% is considered to be "significantly
undercapitalized," and an institution that has a tangible equity capital to
assets ratio equal to or less than 2.0% is deemed to be "critically
undercapitalized." For purposes of the regulation, the term "tangible equity"
includes core capital elements counted as Tier 1 Capital for purposes of the
risk-based capital standards plus the amount of outstanding cumulative perpetual
preferred stock (including related surplus), minus all intangible assets with
certain exceptions. A depository institution may be deemed to be in a
capitalization category that is lower than is indicated by its actual capital
position if it receives an unsatisfactory examination rating.
An institution that is categorized as undercapitalized, significantly
undercapitalized, or critically undercapitalized is required to submit an
acceptable capital restoration plan to its appropriate federal banking agency. A
bank holding company must guarantee that a subsidiary depository institution
meet its capital restoration plan, subject to certain limitations. The
obligation of a controlling bank holding company to fund a capital restoration
plan is limited to the lesser of 5.0% of an undercapitalized subsidiary's assets
or the amount required to meet regulatory capital requirements. An
undercapitalized institution is also generally prohibited from increasing its
average total assets, making acquisitions, establishing any branches, or
engaging in any new line of business, except in accordance with an accepted
capital restoration plan or with the approval of the FDIC. In addition, the
appropriate federal banking agency is given authority with respect to any
undercapitalized depository institution to take any of the actions it is
required to or may take with respect to a significantly undercapitalized
institution if it determines "that those actions are necessary to carry out the
purpose" of the law.
At September 30, 1999, all of the subsidiary banks of Regions and Minden
Bancshares had the requisite capital levels to qualify as well capitalized.
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<PAGE> 55
FDIC INSURANCE ASSESSMENTS
The FDIC currently uses a risk-based assessment system for insured
depository institutions that takes into account the risks attributable to
different categories and concentrations of assets and liabilities. The
risk-based assessment system, which went into effect on January 1, 1994, assigns
an institution to one of three capital categories: (1) well capitalized; (2)
adequately capitalized; and (3) undercapitalized. These three categories are
substantially similar to the prompt corrective action categories described
above, with the "undercapitalized" category including institutions that are
undercapitalized, significantly undercapitalized, and critically
undercapitalized for prompt corrective action purposes. An institution is also
assigned by the FDIC to one of three supervisory subgroups within each capital
group. The supervisory subgroup to which an institution is assigned is based on
a supervisory evaluation provided to the FDIC by the institution's primary
federal regulator and information which the FDIC determines to be relevant to
the institution's financial condition and the risk posed to the deposit
insurance funds (which may include, if applicable, information provided by the
institution's state supervisor). An institution's insurance assessment rate is
then determined based on the capital category and supervisory category to which
it is assigned. Under the final risk-based assessment system, there are nine
assessment risk classifications (i.e., combinations of capital groups and
supervisory subgroups) to which different assessment rates are applied.
All of Regions' subsidiary banks are now assessed at the well-capitalized
level where the premium rate is currently zero. Like all insured banks, all of
Regions' subsidiary banks also must pay a quarterly assessment of approximately
$.02 per $100 of assessable deposits to pay off bonds that were issued in the
late 1980's by a government corporation, the financing corporation, to raise
funds to cover costs of the savings and loan crisis.
The FDIC may terminate an institution's insurance of deposits upon a
finding that the institution has engaged in unsafe and unsound practices, is in
an unsafe or unsound condition to continue operations, or has violated any
applicable law, regulation, rule, order, or condition imposed by the FDIC.
DESCRIPTION OF REGIONS COMMON STOCK
Regions is authorized to issue 500,000,000 shares of Regions common stock
and 5,000,000 shares of preferred stock. At September 30, 1999, 224,170,794
shares of Regions common stock were issued, including 4,882,066 treasury shares,
and 219,288,728 shares were outstanding. At that date no preferred stock was
issued. No other class of stock is authorized.
Holders of Regions common stock are entitled to receive such dividends as
may be declared by the Board of Directors out of funds legally available
therefor. The ability of Regions to pay dividends is affected by the ability of
its subsidiary institutions to pay dividends, which is limited by applicable
regulatory requirements and capital guidelines. At September 30, 1999, under
such requirements and guidelines, Regions' subsidiary institutions had $309
million of undivided profits legally available for the payment of dividends. See
"Supervision and Regulation--Payment of Dividends" on page 45.
For a further description of Regions common stock, see "Effect of the
Merger on Rights of Stockholders" on page 30.
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<PAGE> 56
STOCKHOLDER PROPOSALS
Regions expects to hold its next annual meeting of stockholders after the
merger during May 2000. Under SEC rules, proposals of Regions stockholders
intended to be presented at that meeting must be received by Regions at its
principal executive offices on or before December 9, 1999, for consideration by
Regions for possible inclusion in such proxy statement.
FORWARD-LOOKING STATEMENTS
This Proxy Statement-Prospectus and documents incorporated in it may
include forward looking statements, which reflect Regions' current views with
respect to future events and financial performance. Such forward looking
statements are based on general assumptions and are subject to various risks,
uncertainties, and other factors that may cause actual results to differ
materially from the views, beliefs, and projections expressed in such
statements. Some factors are specific to Regions, including:
- - The cost and other effects of material contingencies, including litigation
contingencies and other contingencies related to acquired operations.
- - Regions' ability to expand into new markets and to maintain profit margins
in the face of pricing pressures.
- - Possible changes in the credit worthiness of Regions' customers and the
possible impairment of collectibility of loans to certain customers
resulting from the impact of Year 2000 issues on customers' operations and
cashflows needed to service indebtedness.
- - The ability of Regions to achieve the earnings expectations related to the
acquired operations of recently-completed and pending acquisitions, which
in turn depends on a variety of factors, including :
- the ability of Regions to achieve the anticipated cost savings and
revenue enhancements with respect to the acquired operations.
- the assimilation of the acquired operations to Regions' corporate
culture, including the ability to instill Regions' credit practices
and efficient approach to the acquired operations.
- the continued growth of the acquired entities' markets consistent with
recent historical experience.
Other factors which may affect Regions apply to the financial services industry
more generally, including:
- - Possible changes in economic and business conditions that may affect the
prevailing interest rates, the prevailing rates of inflation, or the amount
of growth, stagnation, or recession in the global, U.S., and southeastern
U.S. economies, the value of investments, collectibility of loans, and the
profitability of business entities.
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<PAGE> 57
- - Possible changes in monetary and fiscal policies, laws, and regulations,
and other activities of governments, agencies, and similar organizations.
- - The effects of easing of restrictions on participants in the financial
services industry, such as banks, securities brokers and dealers,
investment companies, and finance companies, and attendant changes in
patterns and effects of competition in the financial services industry.
The words "believe", "expect", "anticipate", "project", and similar
expressions signify forward looking statements. Readers are cautioned not to
place undue reliance on any forward looking statements made by or on behalf of
Regions. Any such statement speaks only as of the date the statement was made.
Regions undertakes no obligation to update or revise any forward looking
statements.
EXPERTS
The consolidated financial statements of Regions at December 31, 1998 and
1997, and for each of the three years in the period ended December 31, 1998,
incorporated by reference in this Registration Statement, have been audited by
Ernst & Young LLP, independent auditors, as set forth in their report thereon
which is included in the Annual Report to Stockholders which is incorporated by
reference in its Annual Report on Form 10-K for the year ended December 31,
1998. The financial statements audited by Ernst & Young LLP have been
incorporated herein by reference in reliance on their report given on their
authority as experts in accounting and auditing.
The consolidated financial statements of Minden Bancshares at December 31,
1998 and 1997, and for each of the three years in the period ended December 31,
1998, incorporated by reference in this Registration Statement, have been
audited by Heard, McElroy & Vestal, L.L.P., independent auditors, as set forth
in their report thereon which is included in the Annual Report to Stockholders
which is incorporated by reference in Minden Bancshares' Annual Report on Form
10-KSB for the year ended December 31, 1998. The financial statements of Minden
Bancshares audited by Heard, McElroy & Vestal, L.L.P. have been incorporated
herein by reference in reliance on their report given on their authority as
experts in accounting and auditing.
OPINIONS
The legality of the shares of Regions common stock to be issued in the
merger will be passed upon by Lange, Simpson, Robinson & Somerville LLP,
Birmingham, Alabama. Henry E. Simpson, partner in the law firm of Lange,
Simpson, Robinson & Somerville LLP, is a member of the Board of Directors of
Regions. As of _______, 1999, attorneys in the law firm of Lange, Simpson,
Robinson & Somerville LLP owned an aggregate of _______ shares of Regions common
stock.
Certain tax consequences of the transaction have been passed upon by Alston
& Bird LLP, Atlanta, Georgia.
WHERE YOU CAN FIND MORE INFORMATION
Regions and Minden Bancshares file annual, quarterly and special reports,
proxy statements and other information with the SEC. You may read and copy any
reports, statements or other information that Regions and Minden Bancshares file
with the SEC at the SEC's public reference rooms in Washington,
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<PAGE> 58
D.C., New York, New York and Chicago, Illinois. Please call the SEC at
1-800-SEC-0330 for further information on the public reference rooms. These
filings are also available at the Internet world wide web site maintained by the
SEC at "http://www.sec.gov."
Regions filed a Registration Statement on Form S-4 (the "Registration
Statement") to register with the SEC the Regions common stock to be issued to
Minden Bancshares stockholders in the merger. This Proxy Statement-Prospectus is
a part of that Registration Statement and constitutes a prospectus of Regions.
As allowed by SEC rules, this Proxy Statement-Prospectus does not contain all
the information you can find in Regions' Registration Statement or the exhibits
to that Registration Statement.
SEC regulations allow Regions and Minden Bancshares to "incorporate by
reference" information into this Proxy Statement-Prospectus, which means that
Regions and Minden Bancshares can disclose important information to you by
referring you to another document filed separately with the SEC. The information
incorporated by reference is considered part of this Proxy Statement-Prospectus,
except for any information superseded by information contained directly in this
Proxy Statement-Prospectus or in later filed documents incorporated by reference
in this Proxy Statement-Prospectus.
This Proxy Statement-Prospectus incorporates by reference the documents set
forth below that Regions and Minden Bancshares have previously filed with the
SEC. These documents contain important information about Regions, Minden
Bancshares, and their businesses and finances. Some of these filings may have
been amended by later filings, which are also listed.
<TABLE>
<CAPTION>
REGIONS SEC FILINGS (FILE NO. 0-6159) PERIOD/AS OF DATE
<S> <C>
Annual Report on Form 10-K Year ended December 31, 1998
Quarterly Reports on Form 10-Q/A Quarters ended March 31 and June 30, 1999
Quarterly Report on Form 10-Q Quarter ended September 30, 1999
Current Report on Form 8-K October 18, 1999
MINDEN BANCSHARES SEC FILINGS PERIOD/AS OF DATE
(FILE NO. 0-21658)
Annual Report on Form 10-KSB Year ended December 31, 1998
Quarterly Reports on Form 10-QSB Quarters ended March 31, June 30,
September 30, 1999
</TABLE>
Regions and Minden Bancshares also incorporates by reference additional
documents that may be filed with the SEC between the date of this Proxy
Statement-Prospectus and the consummation of the merger or the termination of
the merger agreement. These include periodic reports, such as Annual Reports on
Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, as
well as proxy statements.
Regions has supplied all information contained or incorporated by reference
in this Proxy Statement-Prospectus relating to Regions, and Minden Bancshares
has supplied all such information relating to Minden Bancshares.
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<PAGE> 59
Even if we have already sent you some of the documents incorporated by
reference, you can obtain any of them through Regions or Minden Bancshares, or
from the SEC or the SEC's Internet web site as described above.
Documents incorporated by reference are available from Regions and Minden
Bancshares without charge, excluding all exhibits, except that if an exhibit is
specifically incorporated by reference in this Proxy Statement-Prospectus, the
exhibit will also be available without charge. Stockholders may obtain documents
incorporated by reference in this Proxy Statement-Prospectus by requesting them
in writing or by telephone from Regions or Minden Bancshares at the following
address, as applicable:
Regions Financial Corporation Minden Bancshares, Inc.
417 North 20th Street 401 Main Street
Birmingham, AL 35203 Minden, Louisiana 71055
Attention: Shareholder relations Attention: Jack E. Byrd, Jr.,
President and Chief Executive
Officer
Telephone: (205) 326-7090 (318) 377-4283
You should rely only on the information contained or incorporated by
reference in this Proxy Statement-Prospectus. We have not authorized anyone to
provide you with information that is different from what is contained in this
Proxy Statement-Prospectus. This Proxy Statement-Prospectus is dated _______
1999. You should not assume that the information contained in this Proxy
Statement-Prospectus is accurate as of any date other than that date. Neither
the mailing of this Proxy Statement-Prospectus to stockholders nor the issuance
of Regions common stock in the merger creates any implication to the contrary.
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<PAGE> 60
APPENDIX A
AGREEMENT AND PLAN OF MERGER
BY AND BETWEEN
MINDEN BANCSHARES, INC.
AND
REGIONS FINANCIAL CORPORATION
DATED AS OF JULY 13, 1999
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TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Parties..................................................... A-6
Preamble.................................................... A-6
ARTICLE 1 -- TRANSACTIONS AND TERMS OF MERGER............... A-6
1.1 Merger............................................... A-6
1.2 Time and Place of Closing............................ A-6
1.3 Effective Time....................................... A-6
1.4 Execution of Support Agreements...................... A-7
ARTICLE 2 -- TERMS OF MERGER................................ A-7
2.1 Certificate of Incorporation......................... A-7
2.2 Bylaws............................................... A-7
2.3 Directors and Officers............................... A-7
ARTICLE 3 -- MANNER OF CONVERTING SHARES.................... A-7
3.1 Conversion of Shares................................. a-7
3.2 Anti-Dilution Provisions............................. A-7
3.3 Shares Held by Minden or Regions..................... A-7
3.4 Dissenting Stockholders.............................. A-7
3.5 Fractional Shares.................................... A-8
3.6 Conversion of Stock Options.......................... A-8
ARTICLE 4 -- EXCHANGE OF SHARES............................. A-8
4.1 Exchange Procedures.................................. A-8
4.2 Rights of Former Minden Stockholders................. A-9
ARTICLE 5 -- REPRESENTATIONS AND WARRANTIES OF MINDEN....... A-10
5.1 Organization, Standing, and Power.................... A-10
5.2 Authority; No Breach By Agreement.................... A-10
5.3 Capital Stock........................................ A-10
5.4 Minden Subsidiaries.................................. A-11
5.5 Financial Statements................................. A-11
5.6 Absence of Undisclosed Liabilities................... A-11
5.7 Absence of Certain Changes or Events................. A-12
5.8 Tax Matters.......................................... A-12
5.9 Assets............................................... A-13
5.10 Environmental Matters................................ A-13
5.11 Compliance with Laws................................. A-14
5.12 Labor Relations...................................... A-14
5.13 Employee Benefit Plans............................... A-14
5.14 Material Contracts................................... A-16
5.15 Legal Proceedings.................................... A-16
5.16 Reports.............................................. A-17
5.17 Statements True and Correct.......................... A-17
5.18 Tax and Regulatory Matters........................... A-17
5.19 State Takeover Laws.................................. A-17
5.20 Charter Provisions................................... A-17
5.21 Support Agreements................................... A-17
5.22 Derivatives.......................................... A-17
5.23 Year 2000............................................ A-18
ARTICLE 6 -- REPRESENTATIONS AND WARRANTIES OF REGIONS...... A-18
6.1 Organization, Standing, and Power.................... A-18
6.2 Authority; No Breach By Agreement.................... A-18
</TABLE>
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<TABLE>
<CAPTION>
PAGE
----
<S> <C>
6.3 Capital Stock........................................ A-19
6.4 Regions Subsidiaries................................. A-19
6.5 SEC Filings; Financial Statements.................... A-19
6.6 Absence of Undisclosed Liabilities................... A-20
6.7 Absence of Certain Changes or Events................. A-20
6.8 Compliance with Laws................................. A-20
6.9 Legal Proceedings.................................... A-20
6.10 Reports.............................................. A-20
6.11 Statements True and Correct.......................... A-21
6.12 Tax and Regulatory Matters........................... A-21
6.13 Derivatives.......................................... A-21
6.14 Year 2000............................................ A-21
ARTICLE 7 -- CONDUCT OF BUSINESS PENDING CONSUMMATION....... A-21
7.1 Affirmative Covenants of Both Parties................ A-21
7.2 Negative Covenants of Minden......................... A-22
7.3 Adverse Changes in Condition......................... A-23
7.4 Reports.............................................. A-23
ARTICLE 8 -- ADDITIONAL AGREEMENTS.......................... A-24
8.1 Registration Statement; Proxy Statement; Stockholder
Approval............................................. A-24
8.2 Exchange Listing..................................... A-24
8.3 Applications......................................... A-24
8.4 Filings with State Offices........................... A-24
8.5 Agreement as to Efforts to Consummate................ A-24
8.6 Investigation and Confidentiality.................... A-25
8.7 Press Releases....................................... A-25
8.8 Certain Actions...................................... A-25
8.9 Tax Treatment........................................ A-26
8.10 State Takeover Laws.................................. A-26
8.11 Charter Provisions................................... A-26
8.12 Agreement of Affiliates.............................. A-26
8.13 Employee Benefits and Contracts...................... A-26
8.14 Indemnification...................................... A-27
8.15 Certain Modifications................................ A-27
ARTICLE 9 -- CONDITIONS PRECEDENT TO OBLIGATIONS TO
CONSUMMATE................................................ A-28
9.1 Conditions to Obligations of Each Party.............. A-28
9.2 Conditions to Obligations of Regions................. A-29
9.3 Conditions to Obligations of Minden.................. A-30
ARTICLE 10 -- TERMINATION................................... A-30
10.1 Termination......................................... A-30
10.2 Effect of Termination............................... A-33
10.3 Non-Survival of Representations and Covenants....... A-33
ARTICLE 11 -- MISCELLANEOUS................................. A-33
11.1 Definitions......................................... A-33
11.2 Expenses............................................ A-38
11.3 Brokers and Finders................................. A-38
11.4 Entire Agreement.................................... A-39
11.5 Amendments.......................................... A-39
</TABLE>
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<TABLE>
<CAPTION>
PAGE
----
<S> <C>
11.6 Waivers............................................. A-39
11.7 Assignment.......................................... A-39
11.8 Notices............................................. A-40
11.9 Governing Law....................................... A-40
11.10 Counterparts........................................ A-40
11.11 Captions............................................ A-40
11.12 Interpretations..................................... A-40
11.13 Enforcement of Agreement............................ A-41
11.14 Severability........................................ A-41
Signatures.................................................. A-41
</TABLE>
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LIST OF EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<C> <S> <C>
1. -- Form of Support Agreement. (sec. 1.4).
2. -- Form of Affiliate Agreement. (sec.sec. 8.12, 9.2(d)).
3. -- Form of Claims Letter. (sec. 9.2(e)).
4. -- Opinion of Minden Counsel (sec. 9.2(f)).
5. -- Opinion of Regions Counsel (sec. 9.3(d)).
</TABLE>
[EXHIBITS OMITTED]
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AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (this "Agreement") is made and entered
into as of July 13, 1999, by and between MINDEN BANCSHARES, INC. ("Minden"), a
corporation organized and existing under the Laws of the State of Louisiana,
with its principal office located in Minden, Louisiana; and REGIONS FINANCIAL
CORPORATION ("Regions"), a corporation organized and existing under the Laws of
the State of Delaware, with its principal office located in Birmingham, Alabama.
PREAMBLE
The Boards of Directors of Minden and Regions are of the opinion that the
transactions described herein are in the best interests of the parties to this
Agreement and their respective stockholders. This Agreement provides for the
acquisition of Minden by Regions pursuant to the merger of Minden with and into
Regions. At the effective time of the Merger, the outstanding shares of the
capital stock of Minden shall be converted into shares of the common stock of
Regions (except as provided herein). As a result, stockholders of Minden shall
become stockholders of Regions, and each of the subsidiaries of Minden shall
continue to conduct its business and operations as a subsidiary of Regions. The
transactions described in this Agreement are subject to the approvals of the
stockholders of Minden, the Board of Governors of the Federal Reserve System,
and certain state regulatory authorities, and the satisfaction of certain other
conditions described in this Agreement. It is the intention of the parties to
this Agreement that the Merger for federal income tax purposes shall qualify as
a "reorganization" within the meaning of Section 368(a) of the Internal Revenue
Code.
As a condition and inducement to Regions' willingness to enter into this
Agreement, each of Minden's directors is executing and delivering to Regions an
agreement (a "Support Agreement"), in substantially the form of Exhibit 1.
Certain terms used in this Agreement are defined in Section 11.1 of this
Agreement.
NOW, THEREFORE, in consideration of the above and the mutual warranties,
representations, covenants, and agreements set forth herein, the Parties agree
as follows:
ARTICLE 1
TRANSACTIONS AND TERMS OF MERGER
1.1 Merger. Subject to the terms and conditions of this Agreement, at the
Effective Time, Minden shall be merged with and into Regions in accordance with
the provisions of Section 12:112 of the LBCL and Section 252 of the DGCL and
with the effect provided in Section 12:115 of the LBCL and Section 259 of the
DGCL (the "Merger"). Regions shall be the Surviving Corporation resulting from
the Merger and shall continue to be governed by the Laws of the State of
Delaware. The Merger shall be consummated pursuant to the terms of this
Agreement, which has been approved and adopted by the respective Boards of
Directors of Minden and Regions.
1.2 Time and Place of Closing. The consummation of the Merger (the
"Closing") shall take place at 9:00 A.M. on the date that the Effective Time
occurs (or the immediately preceding day if the Effective Time is earlier than
9:00 A.M.), or at such other time as the Parties, acting through their duly
authorized officers, may mutually agree. The place of Closing shall be at such
location as may be mutually agreed upon by the Parties.
1.3 Effective Time. The Merger and the other transactions contemplated by
this Agreement shall become effective on the date and at the time the Louisiana
Certificate of Merger reflecting the Merger shall become effective with the
Secretary of State of the State of Louisiana and the Delaware Certificate of
Merger reflecting the Merger shall become effective with the Secretary of State
of the State of Delaware (the "Effective Time"). Subject to the terms and
conditions hereof, unless otherwise mutually agreed upon by the duly authorized
officers of each Party, the Parties shall use their reasonable efforts to cause
the Effective Time to occur on the last business day of the month in which the
last of the following occurs: (i) the effective date (including expiration of
any applicable waiting period) of the last required Consent of any Regulatory
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Authority having authority over and approving or exempting the Merger; and (ii)
the date on which the stockholders of Minden approve the matters relating to
this Agreement required to be approved by such stockholders by applicable Law;
or such later day within 30 days thereof as may be specified by Regions.
1.4 Execution of Support Agreements. Immediately prior to the execution of
this Agreement and as a condition hereto, each of the directors of Minden is
executing and delivering to Regions a Support Agreement.
ARTICLE 2
TERMS OF MERGER
2.1 Certificate of Incorporation. The Certificate of Incorporation of
Regions in effect immediately prior to the Effective Time shall be the
Certificate of Incorporation of the Surviving Corporation after the Effective
Time until otherwise amended or repealed.
2.2 Bylaws. The Bylaws of Regions in effect immediately prior to the
Effective Time shall be the Bylaws of the Surviving Corporation after the
Effective Time until otherwise amended or repealed.
2.3 Directors and Officers. The directors of Regions in office immediately
prior to the Effective Time, together with such additional persons as may
thereafter be elected, shall serve as the directors of the Surviving Corporation
from and after the Effective Time in accordance with the Bylaws of the Surviving
Corporation. The officers of Regions in office immediately prior to the
Effective Time, together with such additional persons as may thereafter be
elected, shall serve as the officers of the Surviving Corporation from and after
the Effective Time in accordance with the Bylaws of the Surviving Corporation.
ARTICLE 3
MANNER OF CONVERTING SHARES
3.1 Conversion of Shares. Subject to the provisions of this Article 3, at
the Effective Time, by virtue of the Merger and without any action on the part
of Regions or Minden, or the stockholders of either of the foregoing, the shares
of the constituent corporations shall be converted as follows:
(a) Each share of Regions Common Stock issued and outstanding
immediately prior to the Effective Time shall remain issued and outstanding
from and after the Effective Time.
(b) Each share of Minden Common Stock (excluding shares held by any
Minden Company or any Regions Company, in each case other than in a
fiduciary capacity or as a result of debts previously contracted) issued
and outstanding at the Effective Time shall be converted into 8.0 shares of
Regions Common Stock (subject to adjustment as provided in Section 10.1(g)
of this Agreement, the "Exchange Ratio").
3.2 Anti-Dilution Provisions. In the event Minden changes the number of
shares of Minden Common Stock issued and outstanding prior to the Effective Time
as a result of a stock split, stock dividend or similar recapitalization with
respect to such stock, the Exchange Ratio shall be proportionately adjusted. In
the event Regions changes the number of shares of Regions Common Stock issued
and outstanding prior to the Effective Time as a result of a stock split, stock
dividend, or similar recapitalization with respect to such stock and the record
date therefor (in the case of a stock dividend) or the effective date thereof
(in the case of a stock split or similar recapitalization for which a record
date is not established) shall be prior to the Effective Time, the Exchange
Ratio shall be proportionately adjusted.
3.3 Shares Held by Minden or Regions. Each of the shares of Minden Common
Stock held by any Minden Company or by any Regions Company, in each case other
than in a fiduciary capacity or as a result of debts previously contracted,
shall be canceled and retired at the Effective Time and no consideration shall
be issued in exchange therefor.
3.4 Dissenting Stockholders. Any holder of shares of Minden Common Stock
who perfects such holder's dissenters' rights of appraisal in accordance with
and as contemplated by Part XIII of the LBCL shall
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be entitled to receive the value of such shares in cash as determined pursuant
to such provision of Law; provided, that no such payment shall be made to any
dissenting stockholder unless and until such dissenting stockholder has complied
with the applicable provisions of the LBCL, including the provisions of Section
131 thereof relating to the deposit in escrow, endorsement, and transfer of the
certificate or certificates representing the shares for which payment is being
made. In the event that a dissenting stockholder of Minden fails to perfect, or
effectively withdraws or loses, his right to appraisal and of payment for his
shares, such Person shall not have the right to receive payment in cash for his
shares and, instead, as of the Effective Time the shares of Minden Common Stock
held by such Person shall be converted into and exchanged for that number of
shares of Regions Common Stock determined under Section 3.1 of this Agreement
and the delivery of certificates representing such Regions Common Stock and any
dividends or other distributions in respect thereof to which such holder may be
entitled shall be governed by Section 4.1 of this Agreement.
3.5 Fractional Shares. Notwithstanding any other provision of this
Agreement, each holder of shares of Minden Common Stock exchanged pursuant to
the Merger who would otherwise have been entitled to receive a fraction of a
share of Regions Common Stock (after taking into account all certificates
delivered by such holder) shall receive, in lieu thereof, cash (without
interest) in an amount equal to such fractional part of a share of Regions
Common Stock multiplied by the market value of one share of Regions Common Stock
at the Effective Time. The market value of one share of Regions Common Stock at
the Effective Time shall be the last sale price of Regions Common Stock on the
Nasdaq NMS (as reported by The Wall Street Journal or, if not reported thereby,
any other authoritative source selected by Regions) on the last trading day
preceding the Effective Time. No such holder will be entitled to dividends,
voting rights, or any other rights as a stockholder in respect of any fractional
shares.
3.6 Conversion of Stock Options.
(a) At the Effective Time, all rights with respect to Minden Common Stock
pursuant to stock options or stock appreciation rights ("Minden Options")
granted by Minden under the Minden Stock Plans, which are outstanding at the
Effective Time, whether or not exercisable, shall be converted into and become
rights with respect to Regions Common Stock, and Regions shall assume each
Minden Option, in accordance with the terms of the Minden Stock Plan and stock
option agreement by which it is evidenced. From and after the Effective Time,
(i) each Minden Option assumed by Regions may be exercised solely for shares of
Regions Common Stock (or cash in the case of stock appreciation rights), (ii)
the number of shares of Regions Common Stock subject to such Minden Option shall
be equal to the number of shares of Minden Common Stock subject to such Minden
Option immediately prior to the Effective Time multiplied by the Exchange Ratio,
and (iii) the per share exercise price under each such Minden Option shall be
adjusted by dividing the per share exercise price under each such Minden Option
by the Exchange Ratio and rounding down to the nearest cent. It is intended that
the foregoing assumption shall be undertaken in a manner that will not
constitute a "modification" as defined in Section 424 of the Internal Revenue
Code, as to any stock option which is an "incentive stock option." Minden and
Regions agree to take all necessary steps to effectuate the foregoing provisions
of this Section 3.6.
(b) As soon as reasonably practicable after the Effective Time, Regions
shall file a registration statement on Form S-3 or S-8, as the case may be (or
any successor or other appropriate forms), with respect to the shares of Regions
Common Stock subject to such options and shall use its reasonable efforts to
maintain the effectiveness of such registration statement (and maintain the
current status of the prospectus or prospectuses therein) for so long as such
options remain outstanding.
ARTICLE 4
EXCHANGE OF SHARES
4.1 Exchange Procedures. Promptly after the Effective Time, Regions and
Minden shall cause the exchange agent selected by Regions (the "Exchange Agent")
to mail to the former stockholders of Minden appropriate transmittal materials
(which shall specify that delivery shall be effected, and risk of loss and title
to the certificates theretofore representing shares of Minden Common Stock shall
pass, only upon proper
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delivery of such certificates to the Exchange Agent). After the Effective Time,
each holder of shares of Minden Common Stock (other than shares to be canceled
pursuant to Section 3.3 of this Agreement or as to which dissenters' rights of
appraisal have been perfected and not withdrawn or forfeited under Section 131
of the LBCL) issued and outstanding at the Effective Time promptly upon
surrender the certificate or certificates representing such shares to the
Exchange Agent, shall receive in exchange therefor the consideration provided in
Section 3.1 of this Agreement, together with all undelivered dividends and other
distributions in respect of such shares (without interest thereon) pursuant to
Section 4.2 of this Agreement. To the extent required by Section 3.5 of this
Agreement, each holder of shares of Minden Common Stock issued and outstanding
at the Effective Time also shall receive, upon surrender of the certificate or
certificates representing such shares, cash in lieu of any fractional share of
Regions Common Stock to which such holder may be otherwise entitled (without
interest). Until so surrendered, each outstanding certificate of Minden Common
Stock shall be deemed for all purposes, other than as provided below with
respect to the payment of dividends or other distributions payable to the
holders of shares of Regions Common Stock, to represent the consideration into
which the number of shares of Minden Common Stock represented thereby prior to
the Effective Time shall have been converted. Regions shall not be obligated to
deliver the consideration to which any former holder of Minden Common Stock is
entitled as a result of the Merger until such holder surrenders such holder's
certificate or certificates representing the shares of Minden Common Stock for
exchange as provided in this Section 4.1. The certificate or certificates of
Minden Common Stock so surrendered shall be duly endorsed as the Exchange Agent
may require. Any other provision of this Agreement notwithstanding, neither the
Surviving Corporation, Minden, nor the Exchange Agent shall be liable to a
holder of Minden Common Stock for any amounts paid or property delivered in good
faith to a public official pursuant to any applicable abandoned property Law.
4.2 Rights of Former Minden Stockholders. At the Effective Time, the stock
transfer books of Minden shall be closed as to holders of Minden Common Stock
immediately prior to the Effective Time and no transfer of Minden Common Stock
by any such holder shall thereafter be made or recognized. Until surrendered for
exchange in accordance with the provisions of Section 4.1 of this Agreement,
each certificate theretofore representing shares of Minden Common Stock (other
than shares to be canceled pursuant to Sections 3.3 and 3.4 of this Agreement)
shall from and after the Effective Time represent for all purposes only the
right to receive the consideration provided in Sections 3.1 and 3.5 of this
Agreement in exchange therefor, subject, however, to the Surviving Corporation's
obligation to pay any dividends or make any other distributions with a record
date prior to the Effective Time which have been declared or made by Minden in
respect of such shares of Minden Common Stock in accordance with the terms of
this Agreement and which remain unpaid at the Effective Time. To the extent
permitted by Law, former stockholders of record of Minden shall be entitled to
vote after the Effective Time at any meeting of Regions stockholders the number
of whole shares of Regions Common Stock into which their respective shares of
Minden Common Stock are converted, regardless of whether such holders have
exchanged their certificates representing Minden Common Stock for certificates
representing Regions Common Stock in accordance with the provisions of this
Agreement. Whenever a dividend or other distribution is declared by Regions on
the Regions Common Stock, the record date for which is at or after the Effective
Time, the declaration shall include dividends or other distributions on all
shares of Regions Common Stock issuable pursuant to this Agreement, but no
dividend or other distribution payable to the holders of record of Regions
Common Stock as of any time subsequent to the Effective Time shall be delivered
to the holder of any certificate representing shares of Minden Common Stock
issued and outstanding at the Effective Time until such holder surrenders such
certificate for exchange as provided in Section 4.1 of this Agreement. However,
upon surrender of such Minden Common Stock certificate, both the Regions Common
Stock certificate (together with all such undelivered dividends or other
distributions without interest) and any undelivered dividends and cash payments
to be paid for fractional share interests (without interest) shall be delivered
and paid with respect to each share represented by such certificate.
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ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF MINDEN
Minden hereby represents and warrants to Regions as follows:
5.1 Organization, Standing, and Power. Minden is a corporation duly
organized, validly existing, and in good standing under the Laws of the State of
Louisiana, and has the corporate power and authority to carry on its business as
now conducted and to own, lease, and operate its Material Assets. Minden is duly
qualified or licensed to transact business as a foreign corporation in good
standing in the States of the United States and foreign jurisdictions where the
character of its Assets or the nature or conduct of its business requires it to
be so qualified or licensed, except for such jurisdictions in which the failure
to be so qualified or licensed is not reasonably likely to have, individually or
in the aggregate, a Material Adverse Effect on Minden.
5.2 Authority; No Breach By Agreement.
(a) Minden has the corporate power and authority necessary to execute,
deliver, and perform its obligations under this Agreement and to consummate the
transactions contemplated hereby. The execution, delivery, and performance of
this Agreement, and the consummation of the transactions contemplated herein,
including the Merger, have been duly and validly authorized by all necessary
corporate action in respect thereof on the part of Minden, subject to the
approval of this Agreement by the holders of two-thirds of the shares of Minden
Common Stock present at the Stockholders Meeting, which is the only stockholder
vote required for approval of this Agreement and consummation of the Merger by
Minden. Subject to such requisite stockholder approval, this Agreement
represents a legal, valid, and binding obligation of Minden, enforceable against
Minden in accordance with its terms (except in all cases as such enforceability
may be limited by applicable bankruptcy, insolvency, reorganization,
receivership, conservatorship, moratorium, or similar Laws affecting the
enforcement of creditors' rights generally and except that the availability of
the equitable remedy of specific performance or injunctive relief is subject to
the discretion of the court before which any proceeding may be brought).
(b) Neither the execution and delivery of this Agreement by Minden, nor the
consummation by Minden of the transactions contemplated hereby, nor compliance
by Minden with any of the provisions hereof, will (i) conflict with or result in
a breach of any provision of Minden's Articles of Incorporation or Bylaws, or
(ii) constitute or result in a Default under, or require any Consent pursuant
to, or result in the creation of any Lien on any Asset of any Minden Company
under, any Contract or Permit of any Minden Company, where such Default or Lien,
or any failure to obtain such Consent, is reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on Minden, or (iii)
subject to receipt of the requisite Consents referred to in Section 9.1(b) of
this Agreement, violate any Law or Order applicable to any Minden Company or any
of their respective Material Assets.
(c) Other than in connection or compliance with the provisions of the
Securities Laws, applicable state corporate and securities Laws, and rules of
the NASD, and other than Consents required from Regulatory Authorities, and
other than notices to or filings with the Internal Revenue Service or the
Pension Benefit Guaranty Corporation or both with respect to any employee
benefit plans, or under the HSR Act, and other than Consents, filings, or
notifications which, if not obtained or made, are not reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on Minden, no notice
to, filing with, or Consent of, any public body or authority is necessary for
the consummation by Minden of the Merger and the other transactions contemplated
in this Agreement.
5.3 Capital Stock.
(a) The authorized capital stock of Minden consists, as of the date of this
Agreement, of 500,000 shares of Minden Common Stock, of which 280,583 shares are
issued and outstanding as of the date of this Agreement and not more than
294,058 shares will be issued and outstanding at the Effective Time. All of the
issued and outstanding shares of Minden Common Stock are duly and validly issued
and outstanding and are fully paid and nonassessable under the LBCL. None of the
outstanding shares of Minden Common Stock has been issued in violation of any
preemptive rights of the current or past stockholders of Minden. Minden has
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reserved 28,000 shares of Minden Common Stock for issuance under the Minden
Stock Plans, pursuant to which options to purchase not more than 13,475 shares
of Minden Common Stock are outstanding, as set forth in Section 5.3(a) of the
Minden Disclosure Memorandum.
(b) Except as set forth in Section 5.3(a) of this Agreement or Section
5.3(b) of the Minden Disclosure Memorandum, there are no shares of capital stock
or other equity securities of Minden outstanding and no outstanding Rights
relating to the capital stock of Minden.
5.4 Minden Subsidiaries. Minden has disclosed in Section 5.4 of the Minden
Disclosure Memorandum all of the Minden Subsidiaries as of the date of this
Agreement. Minden or one of its Subsidiaries owns all of the issued and
outstanding shares of capital stock of each Minden Subsidiary. No equity
securities of any Minden Subsidiary are or may become required to be issued
(other than to another Minden Company) by reason of any Rights, and there are no
Contracts by which any Minden Subsidiary is bound to issue (other than to
another Minden Company) additional shares of its capital stock or Rights or by
which any Minden Company is or may be bound to transfer any shares of the
capital stock of any Minden Subsidiary (other than to another Minden Company).
There are no Contracts relating to the rights of any Minden Company to vote or
to dispose of any shares of the capital stock of any Minden Subsidiary. Except
as provided in Section 6:262 of the LBL, all of the shares of capital stock of
each Minden Subsidiary held by a Minden Company are fully paid and nonassessable
under the applicable corporation or banking Law of the jurisdiction in which
such Subsidiary is incorporated or organized and are owned by the Minden Company
free and clear of any Lien. Each Minden Subsidiary is either a bank or a
corporation, and is duly organized, validly existing, and (as to corporations)
in good standing under the Laws of the jurisdiction in which it is incorporated
or organized, and has the corporate power and authority necessary for it to own,
lease, and operate its Assets and to carry on its business as now conducted.
Each Minden Subsidiary is duly qualified or licensed to transact business as a
foreign corporation in good standing in the States of the United States and
foreign jurisdictions where the character of its Assets or the nature or conduct
of its business requires it to be so qualified or licensed, except for such
jurisdictions in which the failure to be so qualified or licensed is not
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on Minden. Each Minden Subsidiary that is a depository institution is an
"insured depository institution" as defined in the Federal Deposit Insurance Act
and applicable regulations thereunder, and the deposits in which are insured by
the Bank Insurance Fund or Savings Association Insurance Fund.
5.5 Financial Statements. Minden has disclosed in Section 5.5 of the
Minden Disclosure Memorandum, and has delivered to Regions copies of, all Minden
Financial Statements prepared for periods ended prior to the date hereof and
will deliver to Regions copies of all Minden Financial Statements prepared
subsequent to the date hereof. The Minden Financial Statements (as of the dates
thereof and for the periods covered thereby) (i) are or, if dated after the date
of this Agreement, will be in accordance with the books and records of the
Minden Companies, which are or will be, as the case may be, complete and correct
and which have been or will have been, as the case may be, maintained in
accordance with past business practices, and (ii) present or will present, as
the case may be, fairly the consolidated financial position of the Minden
Companies as of the dates indicated and the consolidated results of operations,
changes in stockholders' equity, and cash flows of the Minden Companies for the
periods indicated, in accordance with GAAP (subject to any exceptions as to
consistency specified therein or as may be indicated in the notes thereto or, in
the case of interim financial statements, to normal recurring year-end
adjustments which were not or are not expected to be Material in amount or
effect).
5.6 Absence of Undisclosed Liabilities. No Minden Company has any
Liabilities that are reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on Minden, except Liabilities which are
accrued or reserved against in the consolidated balance sheets of Minden,
included in the Minden Financial Statements or reflected in the notes thereto
and except for Liabilities incurred in the ordinary course of business
subsequent to March 31, 1999. No Minden Company has incurred or paid any
Liability since March 31, 1999, except for such Liabilities incurred or paid in
the ordinary course of business consistent with past business practice and which
are not reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on Minden, and except for the fees and expenses relating to the
Merger as described in Article 11 hereof.
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5.7 Absence of Certain Changes or Events. Since March 31, 1999, except as
disclosed in the Minden Financial Statements delivered prior to the date of the
Agreement or as otherwise disclosed in the Minden Disclosure Memorandum, (i)
there have been no events, changes, or occurrences which have had, or are
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on Minden, and (ii) the Minden Companies have not taken any action, or
failed to take any action, prior to the date of this Agreement, which action or
failure, if taken after the date of this Agreement, would represent or result in
a Material breach or violation of any of the covenants and agreements of Minden
provided in Article 7 of this Agreement, other than conducting the process that
has led up to the execution and consummation of this Agreement.
5.8 Tax Matters.
(a) Since December 31, 1991, all Tax Returns required to be filed by or on
behalf of any of the Minden Companies have been timely filed, or requests for
extensions have been timely filed, granted, and have not expired for periods
ended on or before December 31, 1998, and, to the Knowledge of Minden, all Tax
Returns filed are complete and accurate in all Material respects. All Tax
Returns for periods ending on or before the date of the most recent fiscal year
end immediately preceding the Effective Time will be timely filed or requests
for extensions will be timely filed. All Taxes shown on filed Tax Returns have
been paid. There is no audit examination, deficiency, or refund Litigation with
respect to any Taxes, that is reasonably likely to result in a determination
that would have, individually or in the aggregate, a Material Adverse Effect on
Minden, except to the extent reserved against in the Minden Financial Statements
dated prior to the date of this Agreement. All Taxes and other Liabilities due
with respect to completed and settled examinations or concluded Litigation have
been paid.
(b) None of the Minden Companies has executed an extension or waiver of any
statute of limitations on the assessment or collection of any Tax due (excluding
such statutes that relate to years currently under examination by the Internal
Revenue Service or other applicable taxing authorities) that is currently in
effect.
(c) Adequate provision for any Taxes due or to become due for any of the
Minden Companies for the period or periods through and including the date of the
respective Minden Financial Statements has been made and is reflected on such
Minden Financial Statements.
(d) Each of the Minden Companies is in compliance with, and its records
contain the information and documents (including properly completed IRS Forms
W-9) necessary to comply with, in all material respects, applicable information
reporting and Tax withholding requirements under federal, state, and local Tax
Laws, and such records identify with specificity all accounts subject to backup
withholding under Section 3406 of the Internal Revenue Code.
(e) None of the Minden Companies has made any payments, is obligated to
make any payments, or is a party to any contract, agreement, or other
arrangement that could obligate it to make any payments that would be disallowed
as a deduction under Section 280G or 162(m) of the Internal Revenue Code, except
as set forth in Section 5.8(e) of the Minden Disclosure Memorandum; provided
that none of the contracts disclosed therein contains any "gross up" provision.
(f) There are no Material Liens with respect to Taxes upon any of the
Assets of the Minden Companies.
(g) There has not been an ownership change, as defined in Internal Revenue
Code Section 382(g), of the Minden Companies that occurred during or after any
Taxable Period in which the Minden Companies incurred a net operating loss that
carries over to any Taxable Period ending after December 31, 1998.
(h) No Minden Company has filed any consent under Section 341(f) of the
Internal Revenue Code concerning collapsible corporations.
(i) After the date of this Agreement, no Material election with respect to
Taxes will be made without the prior consent of Regions, which consent will not
be unreasonably withheld.
(j) No Minden Company has or has had a permanent establishment in any
foreign country, as defined in any applicable tax treaty or convention between
the United States and such foreign country.
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5.9 Assets. The Minden Companies have good and marketable title, free and
clear of all Liens, to all of their respective Assets, other than such defects
and liens which are not reasonably likely to have a Material Adverse Effect on
the Minden Companies. All tangible properties used in the businesses of the
Minden Companies are in good condition, reasonable wear and tear excepted, and
are usable in the ordinary course of business consistent with Minden's past
practices. All Assets which are Material to Minden's business on a consolidated
basis, held under leases or subleases by any of the Minden Companies, are held
under valid Contracts enforceable in accordance with their respective terms
(except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, or other Laws affecting the enforcement of
creditors' rights generally and except that the availability of the equitable
remedy of specific performance or injunctive relief is subject to the discretion
of the court before which any proceedings may be brought), and each such
Contract is in full force and effect. The Minden Companies currently maintain
insurance in amounts, scope, and coverage reasonably necessary for their
operations. None of the Minden Companies has received notice from any insurance
carrier that (i) such insurance will be canceled or that coverage thereunder
will be reduced or eliminated, or (ii) premium costs with respect to such
policies of insurance will be substantially increased. There are presently no
claims pending under such policies of insurance and no notices have been given
by any Minden Company under such policies. The Assets of the Minden Companies
include all Material Assets required to operate the business of the Minden
Companies as presently conducted.
5.10 Environmental Matters.
(a) Each Minden Company, its Participation Facilities, and its Loan
Properties are, and have been, in compliance with all Environmental Laws, except
those instances of non-compliance which are not reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on Minden.
(b) There is no Litigation pending or, to the Knowledge of Minden,
threatened before any court, governmental agency, or authority, or other forum
in which any Minden Company or any of its Participation Facilities has been or,
with respect to threatened Litigation, may reasonably be expected to be named as
a defendant (i) for alleged noncompliance (including by any predecessor) with
any Environmental Law or (ii) relating to the release into the environment of
any Hazardous Material, whether or not occurring at, on, under, or involving a
site owned, leased, or operated by any Minden Company or any of its
Participation Facilities, except for such Litigation pending or threatened that
is not reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on Minden.
(c) There is no Litigation pending, or to the Knowledge of Minden,
threatened before any court, governmental agency, or board, or other forum in
which any of its Loan Properties (or Minden in respect of such Loan Property)
has been or, with respect to threatened Litigation, may reasonably be expected
to be named as a defendant or potentially responsible party (i) for alleged
noncompliance (including by any predecessor) with any Environmental Law or (ii)
relating to the release into the environment of any Hazardous Material, whether
or not occurring at, on, under, or involving a Loan Property, except for such
Litigation pending or threatened that is not reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on Minden.
(d) To the Knowledge of Minden, there is no reasonable basis for any
Litigation of a type described in subsections (b) or (c), except such as is not
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on Minden.
(e) To the Knowledge of Minden, during the period of (i) any Minden
Company's ownership or operation of any of their respective current properties,
(ii) any Minden Company's participation in the management of any Participation
Facility, or (iii) any Minden Company's holding of a security interest in a Loan
Property, there have been no releases of Hazardous Material in, on, under, or
affecting (or potentially affecting) such properties, except such as are not
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on Minden. Prior to the period of (i) any Minden Company's ownership or
operation of any of their respective current properties, (ii) any Minden
Company's participation in the management of any Participation Facility, or
(iii) any Minden Company's holding of a security interest in a Loan Property, to
the Knowledge of Minden, there were no releases of Hazardous Material in, on,
under, or affecting any such
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property, Participation Facility, or Loan Property, except such as are not
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on Minden.
5.11 Compliance with Laws. Minden is duly registered as a bank holding
company under the BHC Act. Each Minden Company has in effect all Permits
necessary for it to own, lease, or operate its Material Assets and to carry on
its business as now conducted, except for those Permits the absence of which are
not reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on Minden, and there has occurred no Default under any such
Permit, other than Defaults which are not reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on Minden. None of
the Minden Companies:
(a) is in violation of any Laws, Orders, or Permits applicable to its
business or employees conducting its business, except for violations which
are not reasonably likely to have, individually or in the aggregate, a
Material Adverse Effect on Minden; and
(b) has received any notification or communication from any agency or
department of federal, state, or local government or any Regulatory
Authority or the staff thereof (i) asserting that any Minden Company is not
in compliance with any of the Laws or Orders which such governmental
authority or Regulatory Authority enforces, where such noncompliance is
reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on Minden, (ii) threatening to revoke any Permits, the
revocation of which is reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on Minden, or (iii) requiring any
Minden Company (x) to enter into or consent to the issuance of a cease and
desist order, formal agreement, directive, commitment, or memorandum of
understanding, or (y) to adopt any Board resolution or similar undertaking,
which restricts materially the conduct of its business, or in any material
manner relates to its capital adequacy, its credit or reserve policies, its
management, or the payment of dividends.
5.12 Labor Relations. No Minden Company is the subject of any Litigation
asserting that it or any other Minden Company has committed an unfair labor
practice (within the meaning of the National Labor Relations Act or comparable
state Law) or seeking to compel it or any other Minden Company to bargain with
any labor organization as to wages or conditions of employment, nor is any
Minden Company a party to or bound by any collective bargaining agreement,
Contract, or other agreement or understanding with a labor union or labor
organization, nor is there any strike or other labor dispute involving any
Minden Company, pending or, to the Knowledge of Minden, threatened, or to the
Knowledge of Minden, is there any activity involving any Minden Company's
employees seeking to certify a collective bargaining unit or engaging in any
other organization activity.
5.13 Employee Benefit Plans.
(a) Minden has disclosed to Regions in writing prior to the execution of
the Agreement and in Section 5.13 of the Minden Disclosure Memorandum, and has
delivered or made available to Regions prior to the execution of this Agreement
correct and complete copies in each case of, all Material Minden Benefit Plans.
For purposes of this Agreement, "Minden Benefit Plans" means all written
pension, retirement, profit-sharing, deferred compensation, stock option,
employee stock ownership, severance pay, vacation, bonus, or other incentive
plan, all other written employee programs or agreements, all medical, vision,
dental, or other written health plans, all life insurance plans, and all other
written employee benefit plans or fringe benefit plans, including written
"employee benefit plans" as that term is defined in Section 3(3) of ERISA
maintained by, sponsored in whole or in part by, or contributed to by, any
Minden Company for the benefit of employees, retirees, dependents, spouses,
directors, independent contractors, or other beneficiaries and under which
employees, retirees, dependents, spouses, directors, independent contractors, or
other beneficiaries are eligible to participate. Any of the Minden Benefit Plans
which is an "employee welfare benefit plan," as that term is defined in Section
3(l) of ERISA, or an "employee pension benefit plan," as that term is defined in
Section 3(2) of ERISA, is referred to herein as a "Minden ERISA Plan." Any
Minden ERISA Plan which is also a "defined benefit plan" (as defined in Section
414(j) of the Internal Revenue Code or Section 3(35) of ERISA) is referred to
herein as a "Minden Pension Plan." Neither Minden nor any Minden Company has an
"obligation to contribute" (as defined in ERISA Section 4212) to a
"multiemployer plan" (as defined in ERISA Sections 4001(a)(3) and 3(37)(A)).
Each "employee pension benefit plan," as defined in
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Section 3(2) of ERISA, ever maintained by any Minden Company that was intended
to qualify under Section 401(a) of the Internal Revenue Code, is disclosed as
such in Section 5.13 of the Minden Disclosure Memorandum.
(b) Minden has delivered or made available to Regions prior to the
execution of this Agreement correct and complete copies of the following
documents: (i) all trust agreements or other funding arrangements for such
Minden Benefit Plans (including insurance contracts), and all amendments
thereto, (ii) with respect to any such Minden Benefit Plans or amendments, all
determination letters, Material rulings, Material opinion letters, Material
information letters, or Material advisory opinions issued by the Internal
Revenue Service, the United States Department of Labor, or the Pension Benefit
Guaranty Corporation after December 31, 1994, (iii) annual reports or returns,
audited or unaudited financial statements, actuarial valuations and reports, and
summary annual reports prepared for any Minden Benefit Plan with respect to the
most recent plan year, and (iv) the most recent summary plan descriptions and
any Material modifications thereto.
(c) All Minden Benefit Plans are in compliance with the applicable terms of
ERISA, the Internal Revenue Code, and any other applicable Laws, the breach or
violation of which is reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on Minden. Each Minden ERISA Plan which is
intended to be qualified under Section 401(a) of the Internal Revenue Code has
received a favorable determination letter from the Internal Revenue Service, and
Minden is not aware of any circumstances likely to result in revocation of any
such favorable determination letter. Each trust created under any Minden ERISA
Plan has been determined to be exempt from Tax under Section 501(a) of the
Internal Revenue Code and Minden is not aware of any circumstance which will or
could reasonably result in revocation of such exemption. With respect to each
Minden Benefit Plan to the Knowledge of Minden, no event has occurred which will
or could reasonably give rise to a loss of any intended Tax consequences under
the Internal Revenue Code or to any Tax under Section 511 of the Internal
Revenue Code that is reasonably likely, individually or in the aggregate, to
have a Material Adverse Effect on Minden. There is no Material pending or, to
the Knowledge of Minden, threatened Litigation relating to any Minden ERISA
Plan.
(d) No Minden Company has engaged in a transaction with respect to any
Minden Benefit Plan that, assuming the Taxable Period of such transaction
expired as of the date of this Agreement, would subject any Minden Company to a
Material tax or penalty imposed by either Section 4975 of the Internal Revenue
Code or Section 502(i) of ERISA in amounts which are reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on Minden. Neither
Minden nor any administrator or fiduciary of any Minden Benefit Plan (or any
agent of any of the foregoing) has engaged in any transaction, or acted or
failed to act in any manner which could subject Minden to any direct or indirect
Liability (by indemnity or otherwise) for breach of any fiduciary, co-fiduciary,
or other duty under ERISA, where such Liability, individually or in the
aggregate, is reasonably likely to have a Material Adverse Effect on Minden. No
oral or written representation or communication with respect to any aspect of
the Minden Benefit Plans has been made to employees of any Minden Company which
is not in accordance with the written or otherwise preexisting terms and
provisions of such plans, where any Liability with respect to such
representation or disclosure is reasonably likely to have a Material Adverse
Effect on Minden.
(e) No Minden Pension Plan has any "unfunded current liability," as that
term is defined in Section 302(d)(8)(A) of ERISA, and the fair market value of
the Assets of any such plan exceeds the plan's "benefit liabilities," as that
term is defined in Section 4001(a)(16) of ERISA, when determined under actuarial
factors that would apply if the plan terminated in accordance with all
applicable legal requirements. Since the date of the most recent actuarial
valuation, there has been (i) no Material change in the financial position or
funded status of any Minden Pension Plan, (ii) no change in the actuarial
assumptions with respect to any Minden Pension Plan, and (iii) no increase in
benefits under any Minden Pension Plan as a result of plan amendments or changes
in applicable Law, any of which is reasonably likely to have, individually or in
the aggregate, a Material Adverse Effect on Minden. Neither any Minden Pension
Plan nor any "single-employer plan," within the meaning of Section 4001(a)(15)
of ERISA, currently or formerly maintained by any Minden Company, or the
single-employer plan of any entity which is considered one employer with Minden
under Section 4001 of ERISA or Section 414 of the Internal Revenue Code or
Section 302 of ERISA (whether or not waived) (a "Minden ERISA Affiliate") has an
"accumulated funding deficiency" within the
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meaning of Section 412 of the Internal Revenue Code or Section 302 of ERISA. All
contributions with respect to a Minden Pension Plan or any single-employer plan
of a Minden ERISA Affiliate have or will be timely made and there is no lien or
expected to be a lien under Internal Revenue Code Section 412(n) or ERISA
Section 302(f) or Tax under Internal Revenue Code Section 4971. No Minden
Company has provided, or is required to provide, security to a Minden Pension
Plan or to any single-employer plan of a Minden ERISA Affiliate pursuant to
Section 401(a)(29) of the Internal Revenue Code. All premiums required to be
paid under ERISA Section 4006 have been timely paid by Minden, except to the
extent any failure would not have a Material Adverse Effect on Minden.
(f) No Liability under Title IV of ERISA has been or is expected to be
incurred by any Minden Company with respect to any defined benefit plan
currently or formerly maintained by any of them or by any Minden ERISA Affiliate
that has not been satisfied in full (other than Liability for Pension Benefit
Guaranty Corporation premiums, which have been paid when due, except to the
extent any failure would not have a Material Adverse Effect on Minden).
(g) No Minden Company has any obligations for retiree health and retiree
life benefits under any of the Minden Benefit Plans other than with respect to
benefit coverage mandated by applicable Law, except as set forth in Section
5.13(g) of the Minden Disclosure Memorandum.
(h) Neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby will, by themselves, (i)
result in any payment (including, without limitation, severance, unemployment
compensation, golden parachute, or otherwise) becoming due to any director or
any employee of any Minden Company from any Minden Company under any Minden
Benefit Plan or otherwise, (ii) increase any benefits otherwise payable under
any Minden Benefit Plan, or (iii) result in any acceleration of the time of
payment or vesting of any such benefit, except as set forth in Section 5.13(h)
of the Minden Disclosure Memorandum.
5.14 Material Contracts. Except as set forth in Section 5.14 of the Minden
Disclosure Memorandum, none of the Minden Companies, nor any of their respective
Assets, businesses, or operations, is a party to, or is bound or affected by, or
receives benefits under, (i) any employment, severance, termination, consulting,
or retirement Contract providing for aggregate payments to any Person in any
calendar year in excess of $50,000, (ii) any Contract relating to the borrowing
of money by any Minden Company or the guarantee by any Minden Company of any
such obligation (other than Contracts evidencing deposit liabilities, purchases
of federal funds, fully-secured repurchase agreements, and Federal Home Loan
Bank advances of depository institution Subsidiaries, trade payables, and
Contracts relating to borrowings or guarantees made in the ordinary course of
business), and (iii) any other Contract or amendment thereto that would be
required to be filed as an exhibit to a Form 10-KSB filed by Minden with the SEC
as of the date of this Agreement that was not filed as an exhibit to Minden's
Form 10-KSB for the fiscal year ended December 31, 1998 (together with all
Contracts referred to in Sections 5.9 and 5.13(a) of this Agreement, the "Minden
Contracts"). With respect to each Minden Contract: (i) the Contract is in full
force and effect; (ii) no Minden Company is in Default thereunder, other than
Defaults which are not reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on Minden; (iii) no Minden Company has
repudiated or waived any Material provision of any such Contract; and (iv) no
other party to any such Contract is, to the Knowledge of Minden, in Default in
any respect, other than Defaults which are not reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on Minden, or has
repudiated or waived any Material provision thereunder. Except for Federal Home
Loan Bank advances, all of the indebtedness of any Minden Company for money
borrowed is prepayable at any time by such Minden Company without penalty or
premium.
5.15 Legal Proceedings.
(a) There is no Litigation instituted or pending, or, to the Knowledge of
Minden, threatened against any Minden Company, or against any Asset, employee
benefit plan, interest, or right of any of them, that is reasonably likely to
have, individually or in the aggregate, a Material Adverse Effect on Minden, nor
are there any Orders of any Regulatory Authorities, other governmental
authorities, or arbitrators outstanding against any Minden Company, that are
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on Minden.
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(b) Section 5.15(b) of the Minden Disclosure Memorandum includes a summary
report of all Litigation as of the date of this Agreement to which any Minden
Company is a party and which names a Minden Company as a defendant or
cross-defendant.
5.16 Reports. Since December 31, 1994, or the date of organization if
later, each Minden Company has timely filed all reports and statements, together
with any amendments required to be made with respect thereto, that it was
required to file with any Regulatory Authorities, except failures to file which
are not reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on Minden. As of their respective dates, each of such reports and
documents, including the financial statements, exhibits, and schedules thereto,
complied in all Material respects with all applicable Laws.
5.17 Statements True and Correct. None of the information supplied or to
be supplied by any Minden Company or any Affiliate thereof regarding Minden or
such Affiliate for inclusion in the Registration Statement to be filed by
Regions with the SEC will, when the Registration Statement becomes effective, be
false or misleading with respect to any Material fact, or contain any untrue
statement of a Material fact, or omit to state any Material fact required to be
stated thereunder or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. None of the
information supplied or to be supplied by any Minden Company or any Affiliate
thereof for inclusion in the Proxy Statement to be mailed to Minden's
stockholders in connection with the Stockholders' Meeting will, when first
mailed to the stockholders of Minden, be false or misleading with respect to any
Material fact, or contain any misstatement of Material fact, or omit to state
any Material fact required to be stated thereunder or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading, or, in the case of the Proxy Statement or any amendment thereof
or supplement thereto, at the time of the Stockholders' Meeting, be false or
misleading with respect to any Material fact, or omit to state any Material fact
required to be stated thereunder or necessary to correct any Material statement
in any earlier communication with respect to the solicitation of any proxy for
the Stockholders' Meeting. All documents that any Minden Company or any
Affiliate thereof is responsible for filing with any Regulatory Authority in
connection with the transactions contemplated hereby will comply as to form in
all Material respects with the provisions of applicable Law.
5.18 Tax and Regulatory Matters. Except as specifically contemplated by
this Agreement, no Minden Company or any Affiliate thereof has taken or agreed
to take any action, and Minden has no Knowledge of any fact or circumstance that
is reasonably likely to (i) prevent the transactions contemplated hereby,
including the Merger, from qualifying as a reorganization within the meaning of
Section 368(a) of the Internal Revenue Code, or (ii) materially impede or delay
receipt of any Consents of Regulatory Authorities referred to in Section 9.1(b)
of this Agreement. To the Knowledge of Minden there exists no fact,
circumstance, or reason why the requisite Consents referred to in Section 9.1(b)
of this Agreement cannot be received in a timely manner without imposition of
any condition of the type described in the last sentence of such Section 9.1(b).
5.19 State Takeover Laws. Each Minden Company has taken all necessary
action to exempt the transactions contemplated by this Agreement from any
applicable "moratorium," "control share," "fair price," "business combination,"
or other anti-takeover laws and regulations of the State of Louisiana
(collectively, "Takeover Laws") including those Laws contained within Section
12:130 et seq. of the LBCL.
5.20 Charter Provisions. Each Minden Company has taken all action so that
the entering into of this Agreement and the consummation of the Merger and the
other transactions contemplated by this Agreement do not and will not result in
the grant of any rights to any Person under the Articles of Incorporation,
Bylaws, or other governing instruments of any Minden Company or restrict or
impair the ability of Regions or any of its Subsidiaries to vote, or otherwise
to exercise the rights of a stockholder with respect to, shares of any Minden
Company that may be directly or indirectly acquired or controlled by it.
5.21 Support Agreements. Each of the directors of Minden has executed and
delivered to Regions a Support Agreement in substantially the form as Exhibit 1
to this Agreement.
5.22 Derivatives. All interest rate swaps, caps, floors, option
agreements, futures and forward contracts, and other similar risk management
arrangements, whether entered into for Minden's own account, or for the account
of one or more the Minden Subsidiaries or their customers, were entered into (i)
in accordance with
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prudent business practices and all applicable Laws, and (ii) with counterparties
believed to be financially responsible.
5.23 Year 2000. Minden has disclosed to Regions a complete and accurate
copy of Minden's plan, including an estimate of the anticipated associated
costs, for implementing modifications to Minden's hardware, software, and
computer systems, chips, and microprocessors, to ensure proper execution and
accurate processing of all date-related data, whether from years in the same
century or in different centuries. Between the date of this Agreement and the
Effective Time, Minden shall endeavor to continue its efforts to implement such
plan.
ARTICLE 6
REPRESENTATIONS AND WARRANTIES OF REGIONS
Regions hereby represents and warrants to Minden as follows:
6.1 Organization, Standing, and Power. Regions is a corporation duly
organized, validly existing, and in good standing under the Laws of the State of
Delaware, and has the corporate power and authority to carry on its business as
now conducted and to own, lease, and operate its Material Assets. Regions is
duly qualified or licensed to transact business as a foreign corporation in good
standing in the States of the United States and foreign jurisdictions where the
character of its Assets or the nature or conduct of its business requires it to
be so qualified or licensed, except for such jurisdictions in which the failure
to be so qualified or licensed is not reasonably likely to have, individually or
in the aggregate, a Material Adverse Effect on Regions.
6.2 Authority; No Breach By Agreement.
(a) Regions has the corporate power and authority necessary to execute,
deliver, and perform its obligations under this Agreement and to consummate the
transactions contemplated hereby. The execution, delivery, and performance of
this Agreement and the consummation of the transactions contemplated herein,
including the Merger, have been duly and validly authorized by all necessary
corporate action in respect thereof on the part of Regions. This Agreement
represents a legal, valid, and binding obligation of Regions, enforceable
against Regions in accordance with its terms (except in all cases as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, receivership, conservatorship, moratorium, or similar Laws
affecting the enforcement of creditors' rights generally and except that the
availability of the equitable remedy of specific performance or injunctive
relief is subject to the discretion of the court before which any proceeding may
be brought).
(b) Neither the execution and delivery of this Agreement by Regions, nor
the consummation by Regions of the transactions contemplated hereby, nor
compliance by Regions with any of the provisions hereof, will (i) conflict with
or result in a breach of any provision of Regions' Certificate of Incorporation
or Bylaws, (ii) constitute or result in a Default under, or require any Consent
pursuant to, or result in the creation of any Lien on any Asset of any Regions
Company under, any Contract or Permit of any Regions Company, where such Default
or Lien, or any failure to obtain such Consent, is reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on Regions, or (iii)
subject to receipt of the requisite Consents referred to in Section 9.1(b) of
this Agreement, violate any Law or Order applicable to any Regions Company or
any of their respective Material Assets.
(c) Other than in connection or compliance with the provisions of the
Securities Laws, applicable state corporate and securities Laws, and rules of
the NASD, and other than Consents required from Regulatory Authorities, and
other than notices to or filings with the Internal Revenue Service or the
Pension Benefit Guaranty Corporation with respect to any employee benefit plans,
or under the HSR Act, and other than Consents, filings, or notifications which,
if not obtained or made, are not reasonably likely to have, individually or in
the aggregate, a Material Adverse Effect on Regions, no notice to, filing with,
or Consent of, any public body or authority is necessary for the consummation by
Regions of the Merger and the other transactions contemplated in this Agreement.
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6.3 Capital Stock. The authorized capital stock of Regions consists, as of
the date of this Agreement, of 500,000,000 shares of Regions Common Stock, of
which 223,910,093 shares were issued and outstanding and 888 shares were held as
treasury shares as of March 31, 1999. All of the issued and outstanding shares
of Regions Common Stock are, and all of the shares of Regions Common Stock to be
issued in exchange for shares of Minden Common Stock upon consummation of the
Merger, when issued in accordance with the terms of this Agreement, will be,
duly and validly issued and outstanding and fully paid and nonassessable under
the DGCL. None of the outstanding shares of Regions Common Stock has been, and
none of the shares of Regions Common Stock to be issued in exchange for shares
of Minden Common Stock upon consummation of the Merger will be, issued in
violation of any preemptive rights of the current or past stockholders of
Regions.
6.4 Regions Subsidiaries. Regions or one of its Subsidiaries owns all of
the issued and outstanding shares of capital stock of each Regions Subsidiary.
No equity securities of any Regions Subsidiary are or may become required to be
issued (other than to another Regions Company) by reason of any Rights, and
there are no Contracts by which any Regions Subsidiary is bound to issue (other
than to another Regions Company) additional shares of its capital stock or
Rights or by which any Regions Company is or may be bound to transfer any shares
of the capital stock of any Regions Subsidiary (other than to another Regions
Company). There are no Contracts relating to the rights of any Regions Company
to vote or to dispose of any shares of the capital stock of any Regions
Subsidiary. All of the shares of capital stock of each Regions Subsidiary held
by a Regions Company are fully paid and, except as provided in statutes pursuant
to which depository institution Subsidiaries are organized, nonassessable under
the applicable corporation or banking Law of the jurisdiction in which such
Subsidiary is incorporated or organized and are owned by the Regions Company
free and clear of any Lien. Each Regions Subsidiary is either a bank or a
corporation, and is duly organized, validly existing, and (as to corporations)
in good standing under the Laws of the jurisdiction in which it is incorporated
or organized, and has the corporate power and authority necessary for it to own,
lease, and operate its Assets and to carry on its business as now conducted.
Each Regions Subsidiary is duly qualified or licensed to transact business as a
foreign corporation in good standing in the States of the United States and
foreign jurisdictions where the character of its Assets or the nature or conduct
of its business requires it to be so qualified or licensed, except for such
jurisdictions in which the failure to be so qualified or licensed is not
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on Regions. Each Regions Subsidiary that is a depository institution is
an "insured depository institution" as defined in the Federal Deposit Insurance
Act and applicable regulations thereunder, and the deposits in which are insured
by the Bank Insurance Fund or Savings Association Insurance Fund.
6.5 SEC Filings; Financial Statements.
(a) Regions has filed and made available to Minden all forms, reports, and
documents required to be filed by Regions with the SEC since January 1 of the
second fiscal year preceding the date of this Agreement (collectively, the
"Regions SEC Reports"). The Regions SEC Reports (i) at the time filed, complied
in all Material respects with the applicable requirements of the 1933 Act and
the 1934 Act, as the case may be, and (ii) did not at the time they were filed
(or if amended or superseded by a filing prior to the date of this Agreement,
then on the date of such filing) contain any untrue statement of a Material fact
or omit to state a Material fact required to be stated in such Regions SEC
Reports or necessary in order to make the statements in such Regions SEC
Reports, in light of the circumstances under which they were made, not
misleading. Except for Regions Subsidiaries that are registered as a broker,
dealer, or investment advisor or filings required due to fiduciary holdings of
the Regions Subsidiaries, none of Regions Subsidiaries is required to file any
forms, reports, or other documents with the SEC.
(b) Each of the Regions Financial Statements (including, in each case, any
related notes) contained in the Regions SEC Reports, including any Regions SEC
Reports filed after the date of this Agreement until the Effective Time,
complied or will comply as to form in all Material respects with the applicable
published rules and regulations of the SEC with respect thereto, was or will be
prepared in accordance with GAAP applied on a consistent basis throughout the
periods involved (except as may be indicated in the notes to such financial
statements or, in the case of unaudited statements, as permitted by Form 10-Q of
the SEC), and fairly presented or will fairly present the consolidated financial
position of Regions and its Subsidiaries as at the
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respective dates and the consolidated results of its operations and cash flows
for the periods indicated, except that the unaudited interim financial
statements were or are subject to normal and recurring year-end adjustments
which were not or are not expected to be Material in amount or effect.
6.6 Absence of Undisclosed Liabilities. No Regions Company has any
Liabilities that are reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on Regions, except Liabilities which are
accrued or reserved against in the consolidated balance sheets of Regions as of
March 31, 1999, included in the Regions Financial Statements or reflected in the
notes thereto and except for Liabilities incurred in the ordinary course of
business subsequent to March 31, 1999. No Regions Company has incurred or paid
any Liability since March 31, 1999, except for such Liabilities incurred or paid
in the ordinary course of business consistent with past business practice and
which are not reasonably likely to have, individually or in the aggregate, a
Material Adverse Effect on Regions.
6.7 Absence of Certain Changes or Events. Since March 31, 1999, except as
disclosed in the Regions Financial Statements delivered prior to the date of
this Agreement, (i) there have been no events, changes or occurrences which have
had, or are reasonably likely to have, individually or in the aggregate, a
Material Adverse Effect on Regions, and (ii) the Regions Companies have
conducted their respective businesses in the ordinary and usual course
(excluding the incurrence of expenses in connection with this Agreement and the
transactions contemplated hereby).
6.8 Compliance with Laws. Regions is duly registered as a bank holding
company under the BHC Act. Each Regions Company has in effect all Permits
necessary for it to own, lease, or operate its Material Assets and to carry on
its business as now conducted, except for those Permits the absence of which are
not reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on Regions, and there has occurred no Default under any such
Permit, other than Defaults which are not reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on Regions. None of
the Regions Companies:
(a) is in violation of any Laws, Orders, or Permits applicable to its
business or employees conducting its business, except for violations which
are not reasonably likely to have, individually or in the aggregate, a
Material Adverse Effect on Regions; and
(b) has received any notification or communication from any agency or
department of federal, state, or local government or any Regulatory
Authority or the staff thereof (i) asserting that any Regions Company is
not in compliance with any of the Laws or Orders which such governmental
authority or Regulatory Authority enforces, where such noncompliance is
reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on Regions, (ii) threatening to revoke any Permits, the
revocation of which is reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on Regions, or (iii) requiring any
Regions Company (x) to enter into or consent to the issuance of a cease and
desist order, formal agreement, directive, commitment, or memorandum of
understanding, or (y) to adopt any Board resolution or similar undertaking,
which restricts materially the conduct of its business, or in any manner
relates to its capital adequacy, its credit or reserve policies, its
management, or the payment of dividends.
6.9 Legal Proceedings. There is no Litigation instituted or pending, or,
to the Knowledge of Regions, threatened against any Regions Company, or against
any Asset, employee benefit plan, interest, or right of any of them, that is
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on Regions, nor are there any Orders of any Regulatory Authorities, other
governmental authorities, or arbitrators outstanding against any Regions
Company, that are reasonably likely to have, individually or in the aggregate, a
Material Adverse Effect on Regions.
6.10 Reports. Since December 31, 1994, or the date of organization if
later, each Regions Company has timely filed all reports and statements,
together with any amendments required to be made with respect thereto, that it
was required to file with any Regulatory Authorities, except failures to file
which are not reasonably likely to have, individually or in the aggregate, a
Material Adverse Effect on Regions. As of their respective dates, each of such
reports and documents, including the financial statements, exhibits, and
schedules thereto, complied in all Material respects with all applicable Laws.
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6.11 Statements True and Correct. None of the information supplied or to
be supplied by any Regions Company or any Affiliate thereof regarding Regions or
such Affiliate for inclusion in the Registration Statement to be filed by
Regions with the SEC will, when the Registration Statement becomes effective, be
false or misleading with respect to any Material fact, or contain any untrue
statement of a Material fact, or omit to state any Material fact required to be
stated thereunder or necessary to make the statements therein not misleading.
None of the information supplied or to be supplied by any Regions Company or any
Affiliate thereof for inclusion in the Proxy Statement to be mailed to Minden's
stockholders in connection with the Stockholders' Meeting, will, when first
mailed to the stockholders of Minden, be false or misleading with respect to any
Material fact, or contain any misstatement of Material fact, or omit to state
any Material fact required to be stated thereunder or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading, or, in the case of the Proxy Statement or any amendment thereof
or supplement thereto, at the time of the Stockholders' Meeting, be false or
misleading with respect to any Material fact, or omit to state any Material fact
required to be stated thereunder or necessary to correct any Material statement
in any earlier communication with respect to the solicitation of any proxy for
the Stockholders' Meeting. All documents that any Regions Company or any
Affiliate thereof is responsible for filing with any Regulatory Authority in
connection with the transactions contemplated hereby will comply as to form in
all Material respects with the provisions of applicable Law.
6.12 Tax and Regulatory Matters. No Regions Company or any Affiliate
thereof has taken or agreed to take any action, and Regions has no Knowledge of
any fact or circumstance that is reasonably likely to (i) prevent the
transactions contemplated hereby, including the Merger, from qualifying as a
reorganization within the meaning of Section 368(a) of the Internal Revenue
Code, or (ii) materially impede or delay receipt of any Consents of Regulatory
Authorities referred to in Section 9.1(b) of this Agreement or result in the
imposition of a condition or restriction of the type referred to in the last
sentence of such Section or otherwise prevent consummation of the transactions
contemplated hereby or delay the Effective Time beyond the date set forth in
Section 10.1(e) of this Agreement.
6.13 Derivatives. All interest rate swaps, caps, floors, option
agreements, futures and forward contracts, and other similar risk management
arrangements, whether entered into for Regions' own account, or for the account
of one or more the Regions Subsidiaries or their customers, were entered into
(i) in accordance with prudent business practices and all applicable Laws, and
(ii) with counterparties believed to be financially responsible.
6.14 Year 2000. Regions has disclosed to Minden a complete and accurate
copy of Regions' plan, including an estimate of the anticipated associated
costs, for implementing modifications to Regions' hardware, software, and
computer systems, chips, and microprocessors, to ensure proper execution and
accurate processing of all date-related data, whether from years in the same
century or in different centuries. Between the date of this Agreement and the
Effective Time, Regions shall endeavor to continue its efforts to implement such
plan.
ARTICLE 7
CONDUCT OF BUSINESS PENDING CONSUMMATION
7.1 Affirmative Covenants of Both Parties. Unless the prior written
consent of the other Party shall have been obtained, and except as otherwise
expressly contemplated herein, each Party shall and shall cause each of its
Subsidiaries to (i) operate its business only in the usual, regular, and
ordinary course, (ii) preserve intact its business organization and Assets and
maintain its rights and franchises, (iii) use its reasonable efforts to maintain
its current employee relationships, and (iv) take no action which would (a)
adversely affect the ability of any Party to obtain any Consents required for
the transactions contemplated hereby without imposition of a condition or
restriction of the type referred to in the last sentence of Section 9.1(b) of
this Agreement, or (b) adversely affect the ability of any Party to perform its
covenants and agreements under this Agreement; provided, that the foregoing
shall not prevent any Regions Company from discontinuing or disposing of any of
its Assets or business, or from acquiring or agreeing to acquire any other
Person or any
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Assets thereof, if such action is, in the judgment of Regions, desirable in the
conduct of the business of Regions and its Subsidiaries.
7.2 Negative Covenants of Minden. From the date of this Agreement until
the earlier of the Effective Time or the termination of this Agreement, Minden
covenants and agrees that it will not do or agree or commit to do, or permit any
of its Subsidiaries to do or agree or commit to do, any of the following without
the prior written consent of Regions, which consent shall not be unreasonably
withheld:
(a) amend the Articles of Incorporation, Bylaws, or other governing
instruments of any Minden Company, or
(b) incur, guarantee, or otherwise become responsible for, any
additional debt obligation or other obligation for borrowed money (other
than indebtedness of a Minden Company to another Minden Company) in excess
of an aggregate of $100,000 (for the Minden Companies on a consolidated
basis), except in the ordinary course of the business consistent with past
practices (which shall include, for Minden Subsidiaries that are depository
institutions, creation of deposit liabilities, purchases of federal funds,
advances from the Federal Reserve Bank or Federal Home Loan Bank, and entry
into repurchase agreements fully secured by U.S. government or agency
securities), or impose, or suffer the imposition, on any Asset of any
Minden Company of any Lien or permit any such Lien to exist (other than in
connection with deposits, repurchase agreements, bankers acceptances,
"treasury tax and loan" accounts established in the ordinary course of
business, the satisfaction of legal requirements in the exercise of trust
powers, and Liens in effect as of the date hereof that are disclosed in the
Minden Disclosure Memorandum); or
(c) repurchase, redeem, or otherwise acquire or exchange (other than
exchanges in the ordinary course under employee benefit plans), directly or
indirectly, any shares, or any securities convertible into any shares, of
the capital stock of any Minden Company, or declare or pay any dividend or
make any other distribution in respect of Minden's capital stock, provided
that Minden may (to the extent legally and contractually permitted to do
so), but shall not be obligated to, declare and pay one or more dividends
on the shares of Minden Common Stock at a cumulative rate of $7.00 per
share from the date of this Agreement until the Effective Time, and
provided further in the event the Effective Time does not occur on or prior
to December 31, 1999, Minden may (to the extent legally and contractually
permitted to do so), but shall not be obligated to declare and pay
quarterly dividends at a rate of $2.00 per share with the same record and
payment dates as those selected by Regions for the payment of dividends in
respect of Regions Common Stock; or
(d) except for this Agreement or pursuant to the exercise of Rights
outstanding as of the date of this Agreement and pursuant to the terms
thereof in existence on the date of this Agreement, issue, sell, pledge,
encumber, authorize the issuance of, enter into any Contract to issue,
sell, pledge, encumber, or authorize the issuance of, or otherwise permit
to become outstanding, any additional shares of Minden Common Stock or any
other capital stock of any Minden Company, or any stock appreciation
rights, or any option, warrant, conversion, or other right to acquire any
such stock, or any security convertible into any such stock; or
(e) adjust, split, combine, or reclassify any capital stock of any
Minden Company or issue or authorize the issuance of any other securities
in respect of or in substitution for shares of Minden Common Stock, or
sell, lease, mortgage, or otherwise dispose of or otherwise encumber (i)
any shares of capital stock of any Minden Subsidiary (unless any such
shares of stock are sold or otherwise transferred to another Minden
Company) or (ii) any Asset other than in the ordinary course of business
for reasonable and adequate consideration and other than dispositions in
the ordinary course of business of (i) investment securities, (ii) loans,
including dispositions thereof through loan participation agreements, and
(iii) other real estate owned by any Minden Company, specifically including
the former Youree Drive branch property; or
(f) except for purchases of U.S. Treasury securities or U.S.
Government agency securities, which in either case have maturities of three
years or less, purchase any securities or make any Material
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investment, either by purchase of stock or securities, contributions to
capital, Asset transfers, or purchase of any Assets, in any Person other
than a wholly-owned Minden Subsidiary, or otherwise acquire direct or
indirect control over any Person, other than in connection with (i)
foreclosures in the ordinary course of business, (ii) acquisitions of
control by a depository institution Subsidiary in its fiduciary capacity,
or (iii) the creation of new wholly-owned Subsidiaries organized to conduct
or continue activities otherwise permitted by this Agreement; or
(g) grant any increase in compensation or benefits to the employees or
officers of any Minden Company, except as required by Law; pay any
severance or termination pay or any bonus other than pursuant to written
policies or written Contracts in effect on the date of this Agreement;
enter into or amend any severance agreements with officers of any Minden
Company; grant any increase in fees or other increases in compensation or
other benefits to directors of any Minden Company; or voluntarily
accelerate the vesting of any stock options or other stock-based
compensation or employee benefits; provided that any Minden Company (i)
shall not be precluded from doing, or committing or agreeing to do, any of
the foregoing if done in the ordinary course of business consistent with
past practices and (ii) may pay bonuses, pay base director and committee
fees, make adjustments to fees or compensation and make contributions to
any Minden Benefit Plans during 1999 which are comparable to such payments,
adjustments and contributions during 1998; or
(h) enter into or amend any employment Contract between any Minden
Company and any Person (unless such amendment is required by Law) that the
Minden Company does not have the unconditional right to terminate without
Liability (other than Liability for services already rendered and in
accordance with the Minden Benefit Plans), at any time on or after the
Effective Time; or
(i) adopt any new employee benefit plan of any Minden Company or make
any Material change in or to any existing employee benefit plans of any
Minden Company other than any such change that is required by Law or that,
in the opinion of counsel, is necessary or advisable to maintain the tax
qualified status of any such plan; or
(j) make any significant change in any Tax or accounting methods or
systems of internal accounting controls, except as may be appropriate to
conform to changes in Tax Laws or regulatory accounting requirements or
GAAP; or
(k) commence any Litigation other than as necessary for the prudent
operation of its business or settle any Litigation involving any Liability
of any Minden Company for Material money damages or restrictions upon the
operations of any Minden Company; or
(l) except in the ordinary course of business, modify, amend, or
terminate any Material Contract or waive, release, compromise, or assign
any Material rights or claims.
7.3 Adverse Changes in Condition. Each Party agrees to give written notice
promptly to the other Party upon becoming aware of the occurrence or impending
occurrence of any event or circumstance relating to it or any of its
Subsidiaries which (i) is reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on it or (ii) would cause or constitute a
Material breach of any of its representations, warranties, or covenants
contained herein, and to use its reasonable efforts to prevent or promptly to
remedy the same.
7.4 Reports. Each Party and its Subsidiaries shall file all reports
required to be filed by it with Regulatory Authorities between the date of this
Agreement and the Effective Time and shall deliver to the other Party copies of
all such reports promptly after the same are filed. If financial statements are
contained in any such reports filed with the SEC, such financial statements will
fairly present the consolidated financial position of the entity filing such
statements as of the dates indicated and the consolidated results of operations,
changes in stockholders' equity, and cash flows for the periods then ended in
accordance with GAAP (subject in the case of interim financial statements to
normal recurring year-end adjustments that are not Material). As of their
respective dates, such reports filed with the SEC will comply in all Material
respects with the Securities Laws and will not contain any untrue statement of a
Material fact or omit to state a Material fact required to be stated therein or
necessary in order to make the statements therein, in light of the circumstances
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under which they were made, not misleading. Any financial statements contained
in any other reports to another Regulatory Authority shall be prepared in
accordance with Laws applicable to such reports.
ARTICLE 8
ADDITIONAL AGREEMENTS
8.1 Registration Statement; Proxy Statement; Stockholder Approval. As soon
as reasonably practicable after execution of this Agreement, Regions shall file
the Registration Statement with the SEC, and shall use its reasonable efforts to
cause the Registration Statement to become effective under the 1933 Act and take
any action required to be taken under the applicable state Blue Sky or
securities Laws in connection with the issuance of the shares of Regions Common
Stock upon consummation of the Merger. Minden shall furnish all information
concerning it and the holders of its capital stock as Regions may reasonably
request for inclusion in the Registration Statement. Minden shall call a
Stockholders' Meeting, to be held as soon as reasonably practicable after the
Registration Statement is declared effective by the SEC, for the purpose of
voting upon approval of this Agreement and such other related matters as it
deems appropriate. In connection with the Stockholders' Meeting, (i) Minden
shall prepare and file with the SEC a Proxy Statement and mail such Proxy
Statement to its stockholders, (ii) the Parties shall furnish to each other all
information concerning them that they may reasonably request in connection with
such Proxy Statement, (iii) the Board of Directors of Minden shall recommend to
its stockholders the approval of the matters submitted for approval, and (iv)
the Board of Directors and officers of Minden shall use their reasonable efforts
to obtain such stockholders' approval, provided that each of Regions and Minden
may withdraw, modify, or change in an adverse manner to the other Party its
recommendations if the Board of Directors of such Party, after having consulted
with and based upon the advice of outside counsel, determines in good faith that
the failure to so withdraw, modify, or change its recommendation could
constitute a breach of the fiduciary duties of Minden's Board of Directors under
applicable Law. In addition, nothing in this Section 8.1 or elsewhere in this
Agreement shall prohibit accurate disclosure by Minden of information that is
required to be disclosed in the Registration Statement or the Proxy Statement or
in any other document required to be filed with the SEC (including, without
limitation, a Solicitation/Recommendation Statement on Schedule 14D-9) or
otherwise required to be publicly disclosed by applicable Law or regulations or
rules of the NASD.
8.2 Exchange Listing. Regions shall use its reasonable efforts to list,
prior to the Effective Time, on the Nasdaq NMS, subject to official notice of
issuance, the shares of Regions Common Stock to be issued to the holders of
Minden Common Stock pursuant to the Merger.
8.3 Applications. Regions shall promptly prepare and file, and Minden
shall cooperate in the preparation and, where appropriate, filing of,
applications with all Regulatory Authorities having jurisdiction over the
transactions contemplated by this Agreement seeking the requisite Consents
necessary to consummate the transactions contemplated by this Agreement. Regions
will promptly furnish to Minden copies of applications filed with all Regulatory
Authorities and copies of written communications received by Regions from any
Regulatory Authorities with respect to the transactions contemplated hereby.
8.4 Filings with State Offices. Upon the terms and subject to the
conditions of this Agreement, Regions shall execute and file the Delaware
Certificate of Merger with the Secretary of State of the State of Delaware and
the Louisiana Certificate of Merger with the Secretary of State of the State of
Louisiana in connection with the Closing.
8.5 Agreement as to Efforts to Consummate. Subject to the terms and
conditions of this Agreement, each Party agrees to use, and to cause its
Subsidiaries to use, its reasonable efforts to take, or cause to be taken, all
actions, and to do, or cause to be done, all things necessary, proper, or
advisable under applicable Laws to consummate and make effective, as soon as
reasonably practicable after the date of this Agreement, the transactions
contemplated by this Agreement, including, without limitation, using its
reasonable efforts to lift or rescind any Order adversely affecting its ability
to consummate the transactions contemplated herein and to cause to be satisfied
the conditions referred to in Article 9 of this Agreement; provided, that
nothing herein shall preclude either Party from exercising its rights under this
Agreement. Each Party shall use, and
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shall cause each of its Subsidiaries to use, its reasonable efforts to obtain
all Consents necessary or desirable for the consummation of the transactions
contemplated by this Agreement.
8.6 Investigation and Confidentiality.
(a) Prior to the Effective Time, each Party shall keep the other Party
advised of all Material developments relevant to its business and to
consummation of the Merger and shall permit the other Party to make or cause to
be made such investigation of the business and properties of it and its
Subsidiaries and of their respective financial and legal conditions as the other
Party reasonably requests, provided that such investigation shall be reasonably
related to the transactions contemplated hereby and shall not interfere
unnecessarily with normal operations. No investigation by a Party shall affect
the representations and warranties of the other Party.
(b) Each Party shall, and shall cause its advisers and agents to, maintain
the confidentiality of all confidential information furnished to it by the other
Party concerning its and its Subsidiaries' businesses, operations, and financial
positions and shall not use such information for any purpose except in
furtherance of the transactions contemplated by this Agreement. If this
Agreement is terminated prior to the Effective Time, each Party shall promptly
return or certify the destruction of all documents and copies thereof, and all
work papers containing confidential information received from the other Party.
(c) Each Party agrees to give the other Party notice as soon as practicable
after any determination by it of any fact or occurrence relating to the other
Party which it has discovered through the course of its investigation and which
represents, or is reasonably likely to represent, either a Material breach of
any representation, warranty, covenant, or agreement of the other Party or which
has had or is reasonably likely to have a Material Adverse Effect on the other
Party; provided, however, that the giving of such notice shall not be
dispositive of the occurrence of such breach or a Material Adverse Effect.
(d) Neither Party nor any of their respective Subsidiaries shall be
required to provide access to or to disclose information where such access or
disclosure would violate or prejudice the rights of its customers, jeopardize
the attorney-client or similar privilege with respect to such information or
contravene any Law, rule, regulation, Order, judgment, decree, fiduciary duty,
or agreement entered into prior to the date of this Agreement. The Parties will
use their reasonable efforts to make appropriate substitute disclosure
arrangements, to the extent practicable, in circumstances in which the
restrictions of the preceding sentence apply.
8.7 Press Releases. Prior to the Effective Time, Regions and Minden shall
consult with each other as to the form and substance of any press release or
other public disclosure materially related to this Agreement or any other
transaction contemplated hereby; provided, that nothing in this Section 8.7
shall be deemed to prohibit any Party from making any disclosure which its
counsel deems necessary or advisable in order to satisfy such Party's disclosure
obligations imposed by Law.
8.8 Certain Actions. Except with respect to this Agreement and the
transactions contemplated hereby, no Minden Company nor any Affiliate thereof
nor any Representatives thereof retained by any Minden Company shall directly or
indirectly solicit or engage in negotiations concerning any Acquisition
Proposal, or provide any confidential information or assistance to, or have any
discussions with, any Person with respect to an Acquisition Proposal.
Notwithstanding the foregoing, Minden may, and may authorize and permit its
Representatives to, provide Persons with confidential information, have
discussions or negotiations with, or otherwise facilitate an effort or attempt
by such Person to make or implement an Acquisition Proposal not solicited in
violation of this Agreement if Minden's Board of Directors, after having
consulted with, and based upon the advice of, outside counsel, determines in
good faith that the failure to take such actions could constitute a breach of
the fiduciary duties of Minden's Board of Directors under applicable Law;
provided, that Minden shall promptly advise Regions following the receipt of any
Acquisition Proposal and the Material details thereof; and, provided further,
that prior to delivery of confidential information relating to Minden or access
to Minden's books, records, or properties in connection therewith, the other
Person shall have entered into a confidentiality agreement substantially similar
to the Confidentiality Agreement previously entered into between Minden and
Regions. Nothing contained in this Section 8.8 shall prohibit the Board of
Directors of Minden from complying with Rule 14e-2, promulgated under the 1934
Act. Subject to the foregoing, Minden
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shall (i) immediately cease and cause to be terminated any existing activities,
discussions, or negotiations with any Persons conducted heretofore with respect
to any of the foregoing, and (ii) direct and use its reasonable efforts to cause
of all its Representatives not to engage in any of the foregoing.
8.9 Tax Treatment. Each of the Parties undertakes and agrees to use its
reasonable efforts to cause the Merger, and to take no action which would cause
the Merger not, to qualify for treatment as a "reorganization" within the
meaning of Section 368(a) of the Internal Revenue Code for federal income tax
purposes.
8.10 State Takeover Laws. Each Minden Company shall take all necessary
steps to exempt the transactions contemplated by this Agreement from, or if
necessary challenge the validity or applicability of, any applicable Takeover
Laws.
8.11 Charter Provisions. Each Minden Company shall take all necessary
action to ensure that the entering into of this Agreement and the consummation
of the Merger and the other transactions contemplated hereby do not and will not
result in the grant of any rights to any Person under the Articles of
Incorporation, Bylaws, or other governing instruments of any Minden Company or
restrict or impair the ability of Regions or any of its Subsidiaries to vote, or
otherwise to exercise the rights of a stockholder with respect to, shares of any
Minden Company that may be directly or indirectly acquired or controlled by it.
8.12 Agreement of Affiliates. Minden has disclosed in Section 8.12 of the
Minden Disclosure Memorandum each Person whom it reasonably believes may be
deemed an "affiliate" of Minden for purposes of Rule 145 under the 1933 Act.
Minden shall use its reasonable efforts to cause each such Person to deliver to
Regions not later than 30 days prior to the Effective Time, a written agreement,
in substantially the form of Exhibit 2, providing that such Person will not
sell, pledge, transfer, or otherwise dispose of the shares of Minden Common
Stock held by such Person except as contemplated by such agreement or by this
Agreement and will not sell, pledge, transfer, or otherwise dispose of the
shares of Regions Common Stock to be received by such Person upon consummation
of the Merger except in compliance with applicable provisions of the 1933 Act
and the rules and regulations thereunder. Shares of Regions Common Stock issued
to such affiliates of Minden in exchange for shares of Minden Common Stock shall
not be transferable, regardless of whether each such affiliate has provided the
written agreement referred to in this Section 8.12 (and Regions shall be
entitled to place restrictive legends upon certificates for shares of Regions
Common Stock issued to affiliates of Minden pursuant to this Agreement to
enforce the provisions of this Section 8.12), except as provided herein. Regions
shall not be required to maintain the effectiveness of the Registration
Statement under the 1933 Act for the purposes of resale of Regions Common Stock
by such affiliates.
8.13. Employee Benefits and Contracts. Following the Effective Time,
Regions shall provide generally to officers and employees of the Minden
Companies, who at or after the Effective Time become employees of a Regions
Company ("Continuing Employees"), employee benefits under employee benefit plans
(other than stock option or other plans involving the potential issuance of
Regions Common Stock except as set forth in this Section 8.13), on terms and
conditions which when taken as a whole are substantially similar to those
currently provided by the Regions Companies to their similarly situated officers
and employees. For purposes of participation and vesting (but not accrual of
benefits) under such employee benefit plans, (i) service under any qualified
defined benefit plans of Minden shall be treated as service under Regions'
qualified defined benefit plans, (ii) service under any qualified defined
contribution plans of Minden shall be treated as service under Regions'
qualified defined contribution plans, and (iii) service under any other employee
benefit plans of Minden shall be treated as service under any similar employee
benefit plans maintained by Regions. Regions shall cause the Regions welfare
benefit plans that cover the Continuing Employees after the Effective Time to
(i) waive any waiting period and restrictions and limitations for preexisting
conditions or insurability, and (ii) cause any deductible, co-insurance, or
maximum out-of-pocket payments made by the Continuing Employees under Minden's
welfare benefit plans to be credited to such Continuing Employees under the
Regions welfare benefit plans, so as to reduce the amount of any deductible,
co-insurance, or maximum out-of-pocket payments payable by the Continuing
Employees under the Regions welfare benefit plans. The continued coverage of the
Continuing Employees under the employee benefits plans maintained by Minden
and/or any Minden Subsidiary immediately prior to the Effective Time during a
transition period shall be deemed to provide the Continuing Employees with
benefits that are no less favorable than those offered to
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other employees of Regions and its Subsidiaries, provided that after the
Effective Time there is no Material reduction (determined on an overall basis)
in the benefits provided under the Minden employee benefit plans. Regions also
shall cause Minden and its Subsidiaries to honor all employment, severance,
consulting, and other compensation Contracts disclosed in Section 8.13 of the
Minden Disclosure Memorandum to Regions between any Minden Company and any
current or former director, officer, or employee thereof, and all provisions for
vested benefits or other vested amounts earned or accrued through the Effective
Time under the Minden Benefit Plans. Regions shall be responsible for the fees
related to the termination of the Minden Benefit Plans.
8.14 Indemnification.
(a) Subject to the conditions set forth in paragraph (b) below, for a
period of six (6) years after the Effective Time, Regions shall indemnify,
defend, and hold harmless each Person entitled to indemnification from a Minden
Company (each, an "Indemnified Party") against all Liabilities arising out of
actions or omissions occurring at or prior to the Effective Time (including,
without limitation, the transactions contemplated by this Agreement) to the full
extent permitted by Louisiana Law, in each case as in effect on the date hereof,
including provisions relating to advances of expenses incurred in the defense of
any Litigation; provided, however, that all rights to indemnification in respect
of any claim asserted or made against an Indemnified Party within such six- (6)
year period shall continue until the final disposition of such claim. Without
limiting the foregoing, in any case in which approval by Minden is required to
effectuate any indemnification, Regions shall cause Minden to direct, at the
election of the Indemnified Party, that the determination of any such approval
shall be made by independent counsel mutually agreed upon between Regions and
the Indemnified Party.
(b) Any Indemnified Party wishing to claim indemnification under paragraph
(a) above, upon learning of any such Liability or Litigation, shall promptly
notify Regions thereof. In the event of any such Litigation (whether arising
before or after the Effective Time), (i) Regions or Minden shall have the right
to assume the defense thereof and Regions shall not be liable to such
Indemnified Parties for any legal expenses of other counsel or any other
expenses subsequently incurred by such Indemnified Parties in connection with
the defense thereof (employing counsel reasonably satisfactory to the
Indemnified Parties), except that if Regions or Minden elects not to assume such
defense or counsel for the Indemnified Parties advises in writing that there are
Material substantive issues which raise conflicts of interest between Regions or
Minden and the Indemnified Parties, the Indemnified Parties may retain counsel
satisfactory to them, and Regions or Minden shall pay all reasonable fees and
expenses of such counsel for the Indemnified Parties promptly as statements
therefor are received; provided, however, that (i) Regions shall be obligated
pursuant to this paragraph (b) to pay for only one firm of counsel for all
Indemnified Parties in any jurisdiction, unless counsel for any Indemnified
Party advises in writing that there are Material substantive issues which raise
conflicts of interest between the Indemnified Parties, (ii) the Indemnified
Parties will cooperate (to the extent reasonably appropriate under the
circumstances) in the defense of any such Litigation, and (iii) Regions shall
not be liable for any settlement effected without its prior written consent; and
provided further that Regions shall not have any obligation hereunder to any
Indemnified Party when and if a court of competent jurisdiction shall determine,
and such determination shall have become final, that the indemnification of such
Indemnified Party in the manner contemplated hereby is prohibited by applicable
Law.
(c) If Regions or any of its successors or assigns shall consolidate with
or merge into any other Person and shall not be the continuing or surviving
Person of such consolidation or merger or shall transfer all or substantially
all of its Assets to any Person, then and in each case, proper provision shall
be made so that the successors and assigns of Regions shall assume the
obligations set forth in this Section 8.14.
(d) The provisions of this Section 8.14 are intended to be for the benefit
of and shall be enforceable by, each Indemnified Party, his or her heirs and
representatives.
8.15 Certain Modifications. Regions and Minden shall consult with respect
to their loan, litigation, and real estate valuation policies and practices
(including loan classifications and levels of reserves) and Minden shall make
such modifications or changes to its policies and practices, if any, prior to
the Effective Time, as may be mutually agreed upon. Regions and Minden also
shall consult with respect to the character, amount,
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and timing of restructuring and Merger-related expense charges to be taken by
each of the Parties in connection with the transactions contemplated by this
Agreement and shall take such charges in accordance with GAAP as may be mutually
agreed upon by the Parties. Neither Party's representations, warranties, and
covenants contained in this Agreement shall be deemed to be inaccurate or
breached in any respect or deemed to have a Material Adverse Effect on Minden as
a consequence of any modifications or charges undertaken solely on account of
this Section 8.15.
ARTICLE 9
CONDITIONS PRECEDENT TO OBLIGATIONS TO CONSUMMATE
9.1 Conditions to Obligations of Each Party. The respective obligations of
each Party to perform this Agreement and to consummate the Merger and the other
transactions contemplated hereby are subject to the satisfaction of the
following conditions, unless waived by both Parties pursuant to Section 11.6 of
this Agreement:
(a) Stockholder Approval. The stockholders of Minden shall have
approved this Agreement, and the consummation of the transactions
contemplated hereby, including the Merger, as and to the extent required by
Law and by the provisions of any governing instruments.
(b) Regulatory Approvals. All Consents of, filings and registrations
with, and notifications to, all Regulatory Authorities required for
consummation of the Merger shall have been obtained or made and shall be in
full force and effect and all waiting periods required by Law shall have
expired. No Consent obtained from any Regulatory Authority which is
necessary to consummate the transactions contemplated hereby shall be
conditioned or restricted in a manner (excluding requirements relating to
the raising of additional capital or the disposition of Assets or deposits)
which in the reasonable good faith judgment of the Board of Directors of
Regions would so materially adversely impact the economic or business
benefits of the transactions contemplated by this Agreement so as to render
inadvisable the consummation of the Merger.
(c) Consents and Approvals. Each Party shall have obtained any and
all Consents required for consummation of the Merger (other than those
referred to in Section 9.1(b) of this Agreement) or for the preventing of
any Default under any Contract or Permit of such Party which, if not
obtained or made, is reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on such Party. No Consent obtained
which is necessary to consummate the transactions contemplated hereby shall
be conditioned or restricted in a manner which in the reasonable good faith
judgment of the Board of Directors of Regions would so materially adversely
impact the economic or business benefits of the transactions contemplated
by this Agreement so as to render inadvisable the consummation of the
Merger.
(d) Legal Proceedings. No court or governmental or Regulatory
Authority of competent jurisdiction shall have enacted, issued,
promulgated, enforced, or entered any Law or Order (whether temporary,
preliminary, or permanent) or taken any other action which prohibits,
restricts, or makes illegal consummation of the transactions contemplated
by this Agreement.
(e) Registration Statement. The Registration Statement shall be
effective under the 1933 Act, no stop orders suspending the effectiveness
of the Registration Statement shall have been issued, no action, suit,
proceeding, or investigation by the SEC to suspend the effectiveness
thereof shall have been initiated and be continuing, and all necessary
approvals under state securities Laws or the 1933 Act or 1934 Act relating
to the issuance or trading of the shares of Regions Common Stock issuable
pursuant to the Merger shall have been received.
(f) Exchange Listing. The shares of Regions Common Stock issuable
pursuant to the Merger shall have been approved for listing on the Nasdaq
NMS, subject to official notice of issuance.
(g) Tax Matters. Each Party shall have received a written opinion
from Alston & Bird LLP, in a form reasonably satisfactory to such Party
(the "Tax Opinion"), dated the date of the Effective Time,
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substantially to the effect that (i) the Merger will constitute a
reorganization within the meaning of Section 368(a) of the Internal Revenue
Code, (ii) no gain or loss will be recognized by holders of Minden Common
Stock who exchange all of their Minden Common Stock solely for Regions
Common Stock pursuant to the Merger (except with respect to any cash
received in lieu of a fractional share interest in Regions Common Stock),
(iii) the tax basis of the Regions Common Stock received by holders of
Minden Common Stock who exchange all of their Minden Common Stock solely
for Regions Common Stock in the Merger will be the same as the tax basis of
the Minden Common Stock surrendered in exchange for the Regions Common
Stock (reduced by an amount allocable to a fractional share interest in
Regions Common Stock for which cash is received), and (iv) the holding
period of the Regions Common Stock received by holders who exchange all of
their Minden Common Stock solely for Regions Common Stock in the Merger
will be the same as the holding period of the Minden Common Stock
surrendered in exchange therefor, provided that such Minden Common Stock is
held as a capital asset at the Effective Time. In rendering such Tax
Opinion, such counsel shall be entitled to rely upon representations of
officers of Minden and Regions reasonably satisfactory in form and
substance to such counsel.
9.2 Conditions to Obligations of Regions. The obligations of Regions to
perform this Agreement and consummate the Merger and the other transactions
contemplated hereby are subject to the satisfaction of the following conditions,
unless waived by Regions pursuant to Section 11.6(a) of this Agreement:
(a) Representations and Warranties. For purposes of this Section
9.2(a), the accuracy of the representations and warranties of Minden set
forth in this Agreement shall be assessed as of the date of this Agreement
and as of the Effective Time with the same effect as though all such
representations and warranties had been made on and as of the Effective
Time (provided that representations and warranties which are confined to a
specified date shall speak only as of such date). The representations and
warranties of Minden set forth in Section 5.3 of this Agreement shall be
true and correct (except for inaccuracies which are de minimis in amount).
The representations and warranties of Minden set forth in Sections 5.18,
5.19, and 5.20 of this Agreement shall be true and correct in all Material
respects. There shall not exist inaccuracies in the representations and
warranties of Minden set forth in this Agreement (including the
representations and warranties set forth in Sections 5.3, 5.18, 5.19, and
5.20) such that the aggregate effect of such inaccuracies has, or is
reasonably likely to have, a Material Adverse Effect on Minden; provided
that, for purposes of this sentence only, those representations and
warranties which are qualified by references to "material," "Material,"
"Material Adverse Effect," or variations thereof, or to the "Knowledge" of
Minden or to a matter being "known" by Minden shall be deemed not to
include such qualifications.
(b) Performance of Agreements and Covenants. Each and all of the
agreements and covenants of Minden to be performed and complied with
pursuant to this Agreement and the other agreements contemplated hereby
prior to the Effective Time shall have been duly performed and complied
with in all Material respects.
(c) Certificates. Minden shall have delivered to Regions (i) a
certificate, dated as of the Effective Time and signed on its behalf by its
duly authorized officers, to the effect that the conditions of its
obligations set forth in Section 9.2(a) and 9.2(b) of this Agreement have
been satisfied, and (ii) certified copies of resolutions duly adopted by
Minden's Board of Directors and stockholders evidencing the taking of all
corporate action necessary to authorize the execution, delivery, and
performance of this Agreement, and the consummation of the transactions
contemplated hereby, all in such reasonable detail as Regions and its
counsel shall request.
(d) Affiliate Agreements. Regions shall have received from each
affiliate of Minden the affiliates agreement referred to in Section 8.12 of
this Agreement.
(e) Claims Letters. Each of the directors and executive officers of
Minden shall have executed and delivered to Regions, letters in
substantially the form of Exhibit 3.
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(f) Legal Opinion. Regions shall have received a written opinion,
dated as of the Effective Time, of counsel to Minden, in substantially the
form of Exhibit 4.
9.3 Conditions to Obligations of Minden. The obligations of Minden to
perform this Agreement and consummate the Merger and the other transactions
contemplated hereby are subject to the satisfaction of the following conditions,
unless waived by Minden pursuant to Section 11.6(b) of this Agreement:
(a) Representations and Warranties. For purposes of this Section
9.3(a), the accuracy of the representations and warranties of Regions set
forth in this Agreement shall be assessed as of the date of this Agreement
and as of the Effective Time with the same effect as though all such
representations and warranties had been made on and as of the Effective
Time (provided that representations and warranties which are confined to a
specified date shall speak only as of such date). The representations and
warranties of Regions set forth in Section 6.3 of this Agreement shall be
true and correct (except for inaccuracies which are de minimis in amount).
The representations and warranties of Regions set forth in Section 6.12 of
this Agreement shall be true and correct in all Material respects. There
shall not exist inaccuracies in the representations and warranties of
Regions set forth in this Agreement (including the representations and
warranties set forth in Sections 6.3 and 6.12) such that the aggregate
effect of such inaccuracies has, or is reasonably likely to have, a
Material Adverse Effect on Regions; provided that, for purposes of this
sentence only, those representations and warranties which are qualified by
references to "material," "Material," "Material Adverse Effect," or
variations thereof, or to the "Knowledge" of Regions or to a matter being
"known" by Regions shall be deemed not to include such qualifications.
(b) Performance of Agreements and Covenants. Each and all of the
agreements and covenants of Regions to be performed and complied with
pursuant to this Agreement and the other agreements contemplated hereby
prior to the Effective Time shall have been duly performed and complied
with in all Material respects.
(c) Certificates. Regions shall have delivered to Minden (i) a
certificate, dated as of the Effective Time and signed on its behalf by its
duly authorized officers, to the effect that the conditions of its
obligations set forth in Section 9.3(a) and 9.3(b) of this Agreement have
been satisfied, and (ii) certified copies of resolutions duly adopted by
Regions' Board of Directors evidencing the taking of all corporate action
necessary to authorize the execution, delivery, and performance of this
Agreement, and the consummation of the transactions contemplated hereby,
all in such reasonable detail as Minden and its counsel shall request.
(d) Legal Opinion. Minden shall have received a written opinion,
dated as of the Effective Time, of counsel to Regions, in substantially the
form of Exhibit 5.
(e) Opinion of Financial Advisor. Minden shall have received a letter
from Hovde Financial, Inc. dated not more than five (5) days prior to the
date of the Proxy Statement to the effect that in the opinion of such firm,
the Exchange Ratio is fair to the stockholders of Minden from a financial
point of view.
ARTICLE 10
TERMINATION
10.1 Termination. Notwithstanding any other provision of this Agreement,
and notwithstanding the approval of this Agreement by the stockholders of
Minden, this Agreement may be terminated and the Merger abandoned at any time
prior to the Effective Time:
(a) By mutual consent of the Board of Directors of Regions and the
Board of Directors of Minden; or
(b) By the Board of Directors of either Party (provided that the
terminating Party is not then in breach of any representation or warranty
contained in this Agreement under the applicable standard set forth in
Section 9.2(a) of this Agreement in the case of Minden and Section 9.3(a)
of this Agreement in
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the case of Regions or in Material breach of any covenant or other
agreement contained in this Agreement) in the event of an inaccuracy of any
representation or warranty of the other Party contained in this Agreement
which cannot be or has not been cured within 30 days after the giving of
written notice to the breaching Party of such inaccuracy and which
inaccuracy would provide the terminating Party the ability to refuse to
consummate the Merger under the applicable standard set forth in Section
9.2(a) of this Agreement in the case of Minden and Section 9.3(a) of this
Agreement in the case of Regions; or
(c) By the Board of Directors of either Party (provided that the
terminating Party is not then in breach of any representation or warranty
contained in this Agreement under the applicable standard set forth in
Section 9.2(a) of this Agreement in the case of Minden and Section 9.3(a)
in the case of Regions) in the event of a Material breach by the other
Party of any covenant or agreement contained in this Agreement which cannot
be or has not been cured within 30 days after the giving of written notice
to the breaching Party of such breach; or
(d) By the Board of Directors of either Party in the event (i) any
Consent of any Regulatory Authority required for consummation of the Merger
and the other transactions contemplated hereby shall have been denied by
final nonappealable action of such authority or if any action taken by such
authority is not appealed within the time limit for appeal, or (ii) the
stockholders of Minden fail to vote their approval of the matters submitted
for the approval by such stockholders at the Stockholders' Meeting where
the transactions were presented to such stockholders for approval and voted
upon; or
(e) By the Board of Directors of either Party in the event that the
Merger shall not have been consummated by March 31, 2000, if the failure to
consummate the transactions contemplated hereby on or before such date is
not caused by any breach of this Agreement by the Party electing to
terminate pursuant to this Section 10.1(e); or
(f) By the Board of Directors of either Party (provided that the
terminating Party is not then in breach of any representation or warranty
contained in this Agreement under the applicable standard set forth in
Section 9.2(a) of this Agreement in the case of Minden and Section 9.3(a)
of this Agreement in the case of Regions or in Material breach of any
covenant or other agreement contained in this Agreement) in the event that
any of the conditions precedent to the obligations of such Party to
consummate the Merger cannot be satisfied or fulfilled by the date
specified in Section 10.1(e) of this Agreement; or
(g) By the Board of Directors of Minden, if it determines by a vote of
a majority of the members of its entire Board, at any time during the
ten-day period commencing two days after the Determination Date, if both of
the following conditions are satisfied:
(1) the Average Closing Price of shares of Regions Common Stock shall
be less than the product of (i) 0.80 and (ii) the Starting Price; and
(2) (i) the quotient obtained by dividing the Average Closing Price
by the Starting Price (such number being referred to herein as the
"Regions Ratio") shall be less than (ii) the quotient obtained by
dividing the Index Price on the Determination Date by the Index Price
on the Starting Date and subtracting 0.15 from the quotient in this
clause (2)(ii) (such number being referred to herein as the "Index
Ratio");
subject, however, to the following three sentences. If Minden refuses to
consummate the Merger pursuant to this Section 10.1(g), it shall give
prompt written notice thereof to Regions; provided, that such notice of
election to terminate may be withdrawn at any time within the
aforementioned ten-day period. During the five-day period commencing with
its receipt of such notice, Regions shall have the option to elect to
increase the Exchange Ratio to equal the lesser of (i) the quotient
obtained by dividing (1) the product of 0.80, the Starting Price, and the
Exchange Ratio (as then in effect) by (2) the Average Closing Price, and
(ii) the quotient obtained by dividing (1) the product of the Index Ratio
and the Exchange Ratio (as then in effect) by (2) the Regions Ratio. If
Regions makes an election contemplated by the preceding sentence, within
such five-day period, it shall give prompt written notice to Minden of such
election and the revised Exchange Ratio, whereupon no termination shall
have occurred pursuant to this Sec-
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tion 10.1(g) and this Agreement shall remain in effect in accordance with
its terms (except as the Exchange Ratio shall have been so modified), and
any references in this Agreement to "Exchange Ratio" shall thereafter be
deemed to refer to the Exchange Ratio as adjusted pursuant to this Section
10.1(g).
For purposes of this Section 10.1(g), the following terms shall have the
meanings indicated:
"Average Closing Price" shall mean the average of the daily last sales
prices of Regions Common Stock as reported on the Nasdaq NMS (as reported by The
Wall Street Journal or, if not reported thereby, another authoritative source as
chosen by Regions) for the ten consecutive full trading days in which such
shares are traded on the Nasdaq NMS ending at the close of trading on the
Determination Date.
"Determination Date" shall mean the date of the Minden Stockholders'
Meeting.
"Index Group" shall mean the 17 bank holding companies listed below, the
common stocks of all of which shall be publicly traded and as to which there
shall not have been, since the Starting Date and before the Determination Date,
any public announcement of a proposal for such company to be acquired or for
such company to acquire another company or companies in transactions with a
value exceeding 25% of the acquiror's market capitalization. In the event that
any such company or companies are removed from the Index Group, the weights
(which shall be determined based upon the number of outstanding shares of common
stock) shall be redistributed proportionately for purposes of determining the
Index Price. The 17 bank holding companies and the weights attributed to them
are as follows:
<TABLE>
<CAPTION>
BANK HOLDING COMPANIES WEIGHTING
---------------------- ---------
<S> <C>
AmSouth Bancorporation...................................... 4.98%
BB&T Corporation............................................ 8.69
Comerica Corp............................................... 4.42
Compass Bancshares.......................................... 3.21
Fifth Third Bancorp......................................... 7.60
Firstar Corporation......................................... 18.70
First Tennessee National Corporation........................ 3.68
First Virginia Banks, Inc................................... 1.42
Marshall & Ilsley Corporation............................... 2.95
National City Corp.......................................... 8.89
PNC Bank Corporation........................................ 8.45
SouthTrust Corporation...................................... 4.73
Summit Bancorp.............................................. 4.84
SunTrust Banks, Inc......................................... 9.09
US Bancorp.................................................. 0.38
Wachovia Corporation........................................ 5.74
Zions Bancorporation........................................ 2.23
------
Total............................................. 100.00%
======
</TABLE>
"Index Price" on a given date shall mean the weighted average (weighted in
accordance with the factors listed above) of the closing prices of the companies
composing the Index Group.
"Starting Date" shall mean the date of this Agreement.
"Starting Price" shall mean the last sale price per share of Regions Common
Stock as reported on the Nasdaq NMS (as reported by The Wall Street Journal or,
if not reported thereby, another authoritative source as chosen by Regions) on
the Starting Date.
If any company belonging to the Index Group or Regions declares or effects
a stock dividend, reclassification, split-up, combination, exchange of shares,
or similar transaction between the Starting Date and the Determination Date, the
prices for the common stock of such company or Regions shall be appropriately
adjusted for the purposes of applying this Section 10.1(g); or
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(h) By the Board of Directors of Regions, at any time prior to the 45th day
after execution of this Agreement without any Liability in the event that the
review of the Assets, business, financial condition, results of operations, and
prospects of Minden undertaken by Regions during such time period or any of the
disclosures contained in the Minden Disclosure Memorandum causes the Board of
Directors of Regions to determine, in its reasonable good faith judgment, that a
fact or circumstance exists or is likely to exist or result which materially and
adversely impacts one or more of the economic benefits to Regions of the
transactions contemplated by this Agreement so as to render inadvisable the
consummation of the Merger.
10.2 Effect of Termination. In the event of the termination and
abandonment of this Agreement pursuant to Section 10.1 of this Agreement, this
Agreement shall become void and have no effect, except that (i) the provisions
of this Section 10.2 and Article 11 and Section 8.6(b) of this Agreement shall
survive any such termination and abandonment, and (ii) a termination pursuant to
Sections 10.1(b), 10.1(c), or 10.1(f) of this Agreement shall not relieve the
breaching Party from Liability for an uncured willful breach of a
representation, warranty, covenant, or agreement giving rise to such
termination.
10.3 Non-Survival of Representations and Covenants. The respective
representations, warranties, obligations, covenants, and agreements of the
Parties shall not survive the Effective Time except this Section 10.3 and
Articles 2, 3, 4, and 11 and Sections 8.12, 8.13 and 8.14 of this Agreement.
ARTICLE 11
MISCELLANEOUS
11.1 Definitions.
(a) Except as otherwise provided herein, the capitalized terms set forth
below shall have the following meanings:
"Acquisition Proposal" with respect to a Party shall mean any tender
offer or exchange offer or any proposal for a merger, acquisition of all of
the stock or Assets of, or other business combination involving such Party
or any of its Subsidiaries or the acquisition of a substantial equity
interest in, or a substantial portion of the Assets of, such Party or any
of its Subsidiaries.
"Affiliate" of a Person shall mean: (i) any other Person directly, or
indirectly through one or more intermediaries, controlling, controlled by
or under common control with such Person; (ii) any officer, director,
partner, employer, or direct or indirect beneficial owner of any 10% or
greater equity or voting interest of such Person; or (iii) any other Person
for which a Person described in clause (ii) acts in any such capacity.
"Agreement" shall mean this Agreement and Plan of Merger, including
the Exhibits delivered pursuant hereto and incorporated herein by
reference.
"Assets" of a Person shall mean all of the assets, properties,
businesses, and rights of such Person of every kind, nature, character, and
description, whether real, personal, or mixed, tangible or intangible,
accrued or contingent, or otherwise relating to or utilized in such
Person's business, directly or indirectly, in whole or in part, whether or
not carried on the books and records of such Person, and whether or not
owned in the name of such Person or any Affiliate of such Person and
wherever located.
"BHC Act" shall mean the federal Bank Holding Company Act of 1956, as
amended.
"Confidentiality Agreement" shall mean that certain Confidentiality
Agreement, entered into prior to the date of this Agreement, between Minden
and Regions.
"Consent" shall mean any consent, approval, authorization, clearance,
exemption, waiver, or similar affirmation by any Person pursuant to any
Contract, Law, Order, or Permit.
"Contract" shall mean any written or oral agreement, arrangement,
authorization, commitment, contract, indenture, instrument, lease,
obligation, plan, practice, restriction, understanding, or undertak-
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ing of any kind or character, or other document to which any Person is a
party or that is binding on any Person or its capital stock, Assets, or
business.
"Default" shall mean (i) any breach or violation of or default under
any Contract, Order, or Permit, (ii) any occurrence of any event that with
the passage of time or the giving of notice or both would constitute a
breach or violation of or default under any Contract, Order, or Permit, or
(iii) any occurrence of any event that with or without the passage of time
or the giving of notice would give rise to a right to terminate or revoke,
change the current terms of, or renegotiate, or to accelerate, increase, or
impose any Liability under, any Contract, Order, or Permit, where, in any
such event, such Default is reasonably likely to have, individually or in
the aggregate, a Material Adverse Effect on a Party.
"Delaware Certificate of Merger" shall mean the certificate of merger
to be executed by Regions and filed with the Secretary of State of the
State of Delaware, relating to the Merger as contemplated by Section 1.1 of
this Agreement.
"DGCL" shall mean the Delaware General Corporation Law.
"Environmental Laws" shall mean all Laws relating to pollution or
protection of human health or the environment (including ambient air,
surface water, ground water, land surface, or subsurface strata) and which
are administered, interpreted, or enforced by the United States
Environmental Protection Agency and state and local agencies with
jurisdiction over, and including common law in respect of, pollution or
protection of the environment, including the Comprehensive Environmental
Response Compensation and Liability Act, as amended, 42 U.S.C. 9601 et seq.
("CERCLA"), the Resource Conservation and Recovery Act, as amended, 42
U.S.C. 6901 et seq. ("RCRA"), and other Laws relating to emissions,
discharges, releases, or threatened releases of any Hazardous Material, or
otherwise relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport, or handling of any Hazardous
Material.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended.
"Exhibits" 1 through 5, inclusive, shall mean the Exhibits so marked,
copies of which are attached to this Agreement. Such Exhibits are hereby
incorporated by reference herein and made a part hereof, and may be
referred to in this Agreement and any other related instrument or document
without being attached hereto.
"GAAP" shall mean generally accepted accounting principles,
consistently applied during the periods involved.
"Hazardous Material" shall mean (i) any hazardous substance, hazardous
material, hazardous waste, regulated substance, or toxic substance (as
those terms are defined by any applicable Environmental Laws) and (ii) any
chemicals, pollutants, contaminants, petroleum, petroleum products, or oil
(and specifically shall include asbestos requiring abatement, removal, or
encapsulation pursuant to the requirements of governmental authorities and
any polychlorinated biphenyls).
"HSR Act" shall mean Section 7A of the Clayton Act, as added by Title
II of the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended,
and the rules and regulations promulgated thereunder.
"Internal Revenue Code" shall mean the Internal Revenue Code of 1986,
as amended, and the rules and regulations promulgated thereunder.
"Knowledge" as used with respect to a Person (including references to
such Person being aware of a particular matter) shall mean the personal
knowledge of the chairman, president, or chief financial officer of such
Person.
"Law" shall mean any code, law, ordinance, regulation, reporting or
licensing requirement, rule, or statute applicable to a Person or its
Assets, Liabilities, or business, including those promulgated, interpreted,
or enforced by any Regulatory Authority.
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"LBCL" shall mean the Louisiana Business Corporation Law as amended.
"LBL" shall mean the Louisiana Banking Law as amended.
"Liability" shall mean any direct or indirect, primary or secondary,
liability, indebtedness, obligation, penalty, cost, or expense (including
costs of investigation, collection, and defense), claim, deficiency,
guaranty, or endorsement of or by any Person (other than endorsements of
notes, bills, checks, and drafts presented for collection or deposit in the
ordinary course of business) of any type, whether accrued, absolute or
contingent, liquidated or unliquidated, matured or unmatured, or otherwise.
"Lien" shall mean any conditional sale agreement, default of title,
easement, encroachment, encumbrance, hypothecation, infringement, lien,
mortgage, pledge, reservation, restriction, security interest, title
retention, or other security arrangement, or any adverse right or interest,
charge, or claim of any nature whatsoever of, on, or with respect to any
property or property interest, other than (i) Liens for property Taxes not
yet due and payable, and (ii) for depository institution Subsidiaries of a
Party, pledges to secure deposits, and other Liens incurred in the ordinary
course of the banking business.
"Litigation" shall mean any action, arbitration, cause of action,
claim, complaint, criminal prosecution, demand letter, governmental or
other examination or investigation, hearing, inquiry, administrative or
other proceeding, or notice (written or oral) by any Person alleging
potential Liability or requesting information relating to or affecting a
Party, its business, its Assets (including Contracts related to it), or the
transactions contemplated by this Agreement, but shall not include regular,
periodic examinations of depository institutions and their Affiliates by
Regulatory Authorities.
"Loan Property" shall mean any property owned, leased, or operated by
the Party in question or by any of its Subsidiaries or in which such Party
or Subsidiary holds a security or other interest (including an interest in
a fiduciary capacity), and, where required by the context, includes the
owner or operator of such property, but only with respect to such property.
"Louisiana Certificate of Merger" shall mean the Certificate of Merger
to be executed by Regions and filed with the Secretary of State of the
State of Louisiana relating to the Merger as contemplated by Section 1.1 of
this Agreement.
"Material" for purposes of this Agreement shall be determined in light
of the facts and circumstances of the matter in question; provided that any
specific monetary amount stated in this Agreement shall determine
materiality in that instance.
"Material Adverse Effect" on a Party shall mean an event, change, or
occurrence which, individually or together with any other event, change, or
occurrence, has a Material adverse impact on (i) the financial condition,
results of operations, or business of such Party and its Subsidiaries,
taken as a whole, or (ii) the ability of such Party to perform its
obligations under this Agreement or to consummate the Merger or the other
transactions contemplated by this Agreement, provided that "Material
Adverse Effect" shall not be deemed to include the impact of (a) changes in
banking and similar Laws of general applicability or interpretations
thereof by courts or governmental authorities, (b) changes in GAAP or
regulatory accounting principles generally applicable to banks and their
holding companies, (c) actions and omissions of a Party (or any of its
Subsidiaries) taken with the prior informed consent of the other Party in
contemplation of the transactions contemplated hereby, (d) any other matter
affecting federally insured depository institutions generally, including,
without limitation, changes in general economic conditions and changes in
prevailing interest or deposit rates and (e) the Merger and compliance with
the provisions of this Agreement (including, without limitation, the fees
and expenses described in this Article 11) on the operating performance of
the Parties.
"Minden Common Stock" shall mean the $2.50 par value common stock of
Minden.
"Minden Companies" shall mean, collectively, Minden and all Minden
Subsidiaries.
"Minden Disclosure Memorandum" shall mean the written information
entitled "Minden Disclosure Memorandum" delivered within five business days
after the date of this Agreement to Regions describing
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in reasonable detail the matters contained therein and, with respect to
each disclosure made therein, specifically referencing each Section or
subsection of this Agreement under which such disclosure is being made.
Information disclosed with respect to one Section or subsection shall not
be deemed to be disclosed for any other purpose hereunder. The inclusion of
any matter in this document shall not be deemed an admission or otherwise
to imply that any such matter is Material for purposes of this Agreement.
"Minden Financial Statements" shall mean (i) the consolidated
statements of condition (including related notes and schedules, if any) of
Minden as of March 31, 1999 and as of December 31, 1998 and 1997, and the
related statements of income, changes in stockholders' equity, and cash
flows (including related notes and schedules, if any) for the three months
ended March 31, 1999 and for each of the three years ended December 31,
1998, 1997, and 1996, as filed by Minden in SEC Documents, and (ii) the
consolidated statements of condition of Minden (including related notes and
schedules, if any) and related statements of income, changes in
stockholders' equity, and cash flows (including related notes and
schedules, if any) included in SEC Documents filed with respect to periods
ended subsequent to March 31, 1999.
"Minden Stock Plans" shall mean the existing stock option and other
stock-based compensation plans of Minden.
"Minden Subsidiaries" shall mean the Subsidiaries of Minden, which
shall include the Minden Subsidiaries described in Section 5.4 of this
Agreement and any corporation, bank, savings association, or other
organization acquired as a Subsidiary of Minden in the future and owned by
Minden at the Effective Time.
"NASD" shall mean the National Association of Securities Dealers, Inc.
"Nasdaq NMS" shall mean the National Market System of The Nasdaq Stock
Market.
"1933 Act" shall mean the Securities Act of 1933, as amended.
"1934 Act" shall mean the Securities Exchange Act of 1934, as amended.
"Order" shall mean any administrative decision or award, decree,
injunction, judgment, order, quasi-judicial decision or award, ruling, or
writ of any federal, state, local, or foreign or other court, arbitrator,
mediator, tribunal, administrative agency, or Regulatory Authority.
"Participation Facility" shall mean any facility or property in which
the Party in question or any of its Subsidiaries participates in the
management, as such term is defined in CERCLA (including, but not limited
to, participating in a fiduciary capacity), and, where required by the
context, said term means the owner or operator of such facility or
property, but only with respect to such facility or property.
"Party" shall mean either Minden or Regions, and "Parties" shall mean
both Minden and Regions.
"Permit" shall mean any federal, state, local, and foreign
governmental approval, authorization, certificate, easement, filing,
franchise, license, notice, permit, or right to which any Person is a party
or that is or may be binding upon or inure to the benefit of any Person or
its securities, Assets, or business.
"Person" shall mean a natural person or any legal, commercial, or
governmental entity, such as, but not limited to, a corporation, general
partnership, joint venture, limited partnership, limited liability company,
trust, business association, group acting in concert, or any person acting
in a representative capacity.
"Proxy Statement" shall mean the proxy statement used by Minden to
solicit the approval of its stockholders of the transactions contemplated
by this Agreement, which shall include the prospectus of Regions relating
to the issuance of the Regions Common Stock to holders of Minden Common
Stock.
"Regions Common Stock" shall mean the $.625 par value common stock of
Regions.
"Regions Companies" shall mean, collectively, Regions and all Regions
Subsidiaries.
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"Regions Financial Statements" shall mean (i) the consolidated
statements of condition (including related notes and schedules, if any) of
Regions as of March 31, 1999 and as of December 31, 1998 and 1997, and the
related statements of income, changes in stockholders' equity, and cash
flows (including related notes and schedules, if any) for the three months
ended March 31, 1999 and for each of the three years ended December 31,
1998, 1997, and 1996, as filed by Regions in SEC Documents, and (ii) the
consolidated statements of condition of Regions (including related notes
and schedules, if any) and related statements of income, changes in
stockholders' equity, and cash flows (including related notes and
schedules, if any) included in SEC Documents filed with respect to periods
ended subsequent to March 31, 1999.
"Regions Subsidiaries" shall mean the Subsidiaries of Regions and any
corporation, bank, savings association, or other organization acquired as a
Subsidiary of Regions in the future and owned by Regions at the Effective
Time.
"Registration Statement" shall mean the Registration Statement on Form
S-4, or other appropriate form, including any pre-effective or
post-effective amendments or supplements thereto, filed with the SEC by
Regions under the 1933 Act with respect to the shares of Regions Common
Stock to be issued to the stockholders of Minden in connection with the
transactions contemplated by this Agreement.
"Regulatory Authorities" shall mean, collectively, the Federal Trade
Commission, the United States Department of Justice, the Board of the
Governors of the Federal Reserve System, the Office of the Comptroller of
the Currency, the Federal Deposit Insurance Corporation, the Office of
Thrift Supervision, all state regulatory agencies having jurisdiction over
the Parties and their respective Subsidiaries, the NASD, and the SEC.
"Representative" shall mean any investment banker, financial advisor,
attorney, accountant, consultant, or other representative of a Person.
"Rights" shall mean all arrangements, calls, commitments, Contracts,
options, rights to subscribe to, scrip, understandings, warrants, or other
binding obligations of any character whatsoever relating to, or securities
or rights convertible into or exchangeable for, shares of the capital stock
of a Person or by which a Person is or may be bound to issue additional
shares of its capital stock or other Rights.
"SEC" shall mean the United States Securities and Exchange Commission.
"SEC Documents" shall mean all forms, proxy statements, registration
statements, reports, schedules, and other documents filed, or required to
be filed, by a Party or any of its Subsidiaries with any Regulatory
Authority pursuant to the Securities Laws.
"Securities Laws" shall mean the 1933 Act, the 1934 Act, the
Investment Company Act of 1940, as amended, the Investment Advisors Act of
1940, as amended, the Trust Indenture Act of 1939, as amended, and the
rules and regulations of any Regulatory Authority promulgated thereunder.
"Stockholders' Meeting" shall mean the meeting of the stockholders of
Minden to be held pursuant to Section 8.1 of this Agreement, including any
adjournment or adjournments thereof.
"Subsidiaries" shall mean all those corporations, banks, associations,
or other entities of which the entity in question owns or controls 50% or
more of the outstanding equity securities either directly or through an
unbroken chain of entities as to each of which 50% or more of the
outstanding equity securities is owned directly or indirectly by its
parent; provided, there shall not be included any such entity acquired
through foreclosure or any such entity the equity securities of which are
owned or controlled in a fiduciary capacity.
"Surviving Corporation" shall mean Regions as the surviving
corporation resulting from the Merger.
"Tax" or "Taxes" shall mean all federal, state, local, and foreign
taxes, charges, fees, levies, imposts, duties, or other assessments,
including income, gross receipts, excise, employment, sales, use, transfer,
license, payroll, franchise, severance, stamp, occupation, windfall
profits, environmental, federal highway use, commercial rent, customs
duties, capital stock, paid-up capital, profits, withholding, Social
Security,
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single business and unemployment, disability, real property, personal
property, registration, ad valorem, value added, alternative or add-on
minimum, estimated, or other tax or governmental fee of any kind
whatsoever, imposed or required to be withheld by the United States or any
state, local, or foreign government or subdivision or agency thereof,
including any interest, penalties, or additions thereto.
"Taxable Period" shall mean any period prescribed by any governmental
authority, including the United States or any state, local, or foreign
government or subdivision or agency thereof for which a Tax Return is
required to be filed or Tax is required to be paid.
"Tax Return" shall mean any report, return, information return, or
other information required to be supplied to a taxing authority in
connection with Taxes, including any return of an affiliated or combined or
unitary group that includes a Party or its Subsidiaries.
(b) The terms set forth below shall have the meanings ascribed thereto in
the referenced sections:
<TABLE>
<S> <C>
Average Closing Price....................................... Section 10.1
Closing..................................................... Section 1.2
Determination Date.......................................... Section 10.1(g)
Effective Time.............................................. Section 1.3
Exchange Agent.............................................. Section 4.1
Exchange Ratio.............................................. Section 3.1(b)
Indemnified Party........................................... Section 8.14
Index Group................................................. Section 10.1(g)
Index Price................................................. Section 10.1(g)
Index Ratio................................................. Section 10.1(g)
Merger...................................................... Section 1.1
Minden Benefit Plans........................................ Section 5.13(a)
Minden Contracts............................................ Section 5.14
Minden ERISA Affiliate...................................... Section 5.13(e)
Minden ERISA Plan........................................... Section 5.13(a)
Minden Pension Plan......................................... Section 5.13(a)
Regions Ratio............................................... Section 10.1(g)
Regions SEC Reports......................................... Section 6.5(a)
Starting Date............................................... Section 10.1(g)
Starting Price.............................................. Section 10.1(g)
Takeover Laws............................................... Section 5.19
Tax Opinion................................................. Section 9.1(g)
</TABLE>
(c) Any singular term in this Agreement shall be deemed to include the
plural, and any plural term the singular. Whenever the words "include,"
"includes," or "including" are used in this Agreement, they shall be deemed
followed by the words "without limitation."
11.2 Expenses.
(a) Except as otherwise provided in this Section 11.2, each of the Parties
shall bear and pay all direct costs and expenses incurred by it or on its behalf
in connection with the transactions contemplated hereunder, including filing,
registration, and application fees, printing fees, and fees and expenses of its
own financial or other consultants, investment bankers, accountants, and
counsel, except that Regions shall bear and pay the filing fees payable in
connection with the Registration Statement and the Proxy Statement and one-half
of the printing costs incurred in connection with the printing of the
Registration Statement and the Proxy Statement.
(b) Nothing contained in this Section 11.2 shall constitute or shall be
deemed to constitute liquidated damages for the willful breach by a Party of the
terms of this Agreement or otherwise limit the rights of the nonbreaching Party.
11.3 Brokers and Finders. Except for Hovde Financial, Inc. as to Minden,
each of the Parties represents and warrants that neither it nor any of its
officers, directors, employees, or Affiliates has employed
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any broker or finder or incurred any Liability for any financial advisory fees,
investment bankers' fees, brokerage fees, commissions, or finders' fees in
connection with this Agreement or the transactions contemplated hereby. In the
event of a claim by any broker or finder based upon his, her, or its
representing or being retained by or allegedly representing or being retained by
Minden or Regions, each of Minden and Regions, as the case may be, agrees to
indemnify and hold the other Party harmless of and from any Liability in respect
of any such claim.
11.4 Entire Agreement. Except as otherwise expressly provided herein, this
Agreement (including the documents and instruments referred to herein)
constitutes the entire agreement between the Parties with respect to the
transactions contemplated hereunder and supersedes all prior arrangements or
understandings with respect thereto, written or oral, other than the
Confidentiality Agreement, which shall remain in effect. Nothing in this
Agreement expressed or implied, is intended to confer upon any Person, other
than the Parties or their respective successors, any rights, remedies,
obligations, or liabilities under or by reason of this Agreement, other than as
provided in Sections 8.12 and 8.14 of this Agreement.
11.5 Amendments. To the extent permitted by Law, this Agreement may be
amended by a subsequent writing signed by each of the Parties upon the approval
of the Boards of Directors of each of the Parties, whether before or after
stockholder approval of this Agreement has been obtained; provided, that the
provisions of this Agreement relating to the manner or basis in which shares of
Minden Common Stock will be exchanged for Regions Common Stock shall not be
amended (except in accordance with Section 10.1(g) of this Agreement) after the
Stockholders' Meeting without the requisite approval of the holders of the
issued and outstanding shares of Regions Common Stock and Minden Common Stock,
as the case may be, entitled to vote thereon.
11.6 Waivers.
(a) Prior to or at the Effective Time, Regions, acting through its Board of
Directors, chief executive officer, chief financial officer, or other authorized
officer, shall have the right to waive any Default in the performance of any
term of this Agreement by Minden, to waive or extend the time for the compliance
or fulfillment by Minden of any and all of its obligations under this Agreement,
and to waive any or all of the conditions precedent to the obligations of
Regions under this Agreement, except any condition which, if not satisfied,
would result in the violation of any Law. No such waiver shall be effective
unless in writing signed by a duly authorized officer of Regions except that any
unfulfilled conditions shall be deemed to have been waived at the Effective
Time.
(b) Prior to or at the Effective Time, Minden, acting through its Board of
Directors, chief executive officer, chief financial officer, or other authorized
officer, shall have the right to waive any Default in the performance of any
term of this Agreement by Regions, to waive or extend the time for the
compliance or fulfillment by Regions of any and all of its obligations under
this Agreement, and to waive any or all of the conditions precedent to the
obligations of Minden under this Agreement, except any condition which, if not
satisfied, would result in the violation of any Law. No such waiver shall be
effective unless in writing signed by a duly authorized officer of Minden except
that any unfulfilled conditions shall be deemed to have been waived at the
Effective Time.
(c) The failure of any Party at any time or times to require performance of
any provision hereof shall in no manner affect the right of such Party at a
later time to enforce the same or any other provision of this Agreement. No
waiver of any condition or of the breach of any term contained in this Agreement
in one or more instances shall be deemed to be or construed as a further or
continuing waiver of such condition or breach or a waiver of any other condition
or of the breach of any other term of this Agreement.
11.7 Assignment. Except as expressly contemplated hereby, neither this
Agreement nor any of the rights, interests, or obligations hereunder shall be
assigned by any Party hereto (whether by operation of Law or otherwise) without
the prior written consent of the other Party. Subject to the preceding sentence,
this Agreement will be binding upon, inure to the benefit of, and be enforceable
by the Parties and their respective successors and assigns.
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11.8 Notices. All notices or other communications which are required or
permitted hereunder shall be in writing and sufficient if delivered by hand, by
facsimile transmission, by registered or certified mail, postage pre-paid, or by
courier or overnight carrier, to the persons at the addresses set forth below
(or at such other address as may be provided hereunder), and shall be deemed to
have been delivered as of the date so delivered:
<TABLE>
<S> <C>
Minden: MINDEN BANCSHARES, INC.
401 Main Street
P.O. Box 400
Minden, Louisiana 71055
Telecopy Number: (318) 377-0362
Attention: Jack E. Byrd, Jr.
President and Chief
Executive Officer
Copy to Counsel: BRACEWELL & PATTERSON, L.L.P.
South Tower Pennzoil Place
Suite 2900
711 Louisiana Street
Houston, Texas 77002-2781
Telecopy Number: (713) 221-1212
Attention: G. Waverly Vest, Jr.
Regions: REGIONS FINANCIAL CORPORATION
417 N. 20th Street
Birmingham, Alabama 35203
Telecopy Number: (205) 326-7571
Attention: Richard D. Horsley
Vice Chairman and
Executive
Financial Officer
Copy to Counsel: REGIONS FINANCIAL CORPORATION
417 N. 20th Street
Birmingham, Alabama 35203
Telecopy Number: (205) 326-7751
Attention: Samuel E. Upchurch, Jr.
General Counsel
</TABLE>
11.9 Governing Law. This Agreement shall be governed by and construed in
accordance with the Laws of the State of Delaware, without regard to any
applicable conflicts of Laws, except to the extent that the Laws of the State of
Louisiana relate to the consummation of the Merger.
11.10 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
11.11 Captions. The captions contained in this Agreement are for reference
purposes only and are not part of this Agreement.
11.12 Interpretations. Neither this Agreement nor any uncertainty or
ambiguity herein shall be construed or resolved against any Party, whether under
any rule of construction or otherwise. No Party to this Agreement shall be
considered the draftsman. The Parties acknowledge and agree that this Agreement
has been reviewed, negotiated, and accepted by all Parties and their attorneys
and shall be construed and interpreted according to the ordinary meaning of the
words used so as fairly to accomplish the purposes and intentions of the
Parties.
11.13 Enforcement of Agreement. The Parties hereto agree that irreparable
damage would occur in the event that any of the provisions of this Agreement was
not performed in accordance with its specific terms or
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was otherwise breached. It is accordingly agreed that the Parties shall be
entitled to an injunction or injunctions to prevent breaches of this Agreement
and to enforce specifically the terms and provisions hereof in any court of the
United States or any state having jurisdiction, this being in addition to any
other remedy to which they are entitled at law or in equity.
11.14 Severability. Any term or provision of this Agreement which is
invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction. If any provision of this
Agreement is so broad as to be unenforceable, the provision shall be interpreted
to be only so broad as is enforceable.
IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be
executed on its behalf and its corporate seal to be hereunto affixed and
attested by officers thereunto as of the day and year first above written.
<TABLE>
<S> <C>
ATTEST: MINDEN BANCSHARES, INC.
By: /s/ JOHN W. MONTGOMERY By: /s/ JACK E. BYRD, JR.
--------------------------------------------------- ---------------------------------------------------
John W. Montgomery Jack E. Byrd, Jr.
Secretary President and Chief Executive Officer
[CORPORATE SEAL]
ATTEST: REGIONS FINANCIAL CORPORATION
By: /s/ SAMUEL E. UPCHURCH, JR. By: /s/ RICHARD D. HORSLEY
--------------------------------------------------- ---------------------------------------------------
Samuel E. Upchurch, Jr. Richard D. Horsley
Corporate Secretary Vice Chairman
[CORPORATE SEAL]
</TABLE>
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APPENDIX B
November , 1999
Board of Directors
Minden Bancshares, Inc.
401 Main Street
Minden, LA 71055
Members of the Board:
We have reviewed the Agreement and Plan of Merger (the "Agreement") and
related exhibits and schedules dated July 13, 1999 by and among Regions
Financial Corporation ("Regions") and Minden Bancshares, Inc. ("Minden"),
pursuant to which, among other things, Minden will be merged with and into
Regions (the "Merger"). As is set forth in the Agreement, all of the issued and
outstanding shares of Minden Common Stock, including all shares issued with
respect to the Options and Warrants, shall be converted into the right to
receive eight (8) shares of Regions Common Stock, subject to adjustment as
provided for in the Agreement (the "Merger Consideration"). Capitalized terms
used herein shall have the same meaning as in the Agreement, unless specifically
stated otherwise.
Hovde Financial LLC ("Hovde") specializes in providing investment banking
and financial advisory services to commercial bank and thrift institutions. Our
principals are experienced in the independent valuation of securities in
connection with negotiated underwritings, subscription and community offerings,
private placements, merger and acquisition transactions and recapitalizations.
Pursuant to a Consulting Agreement dated December 14, 1998, between Minden and
Hovde, Hovde was engaged to assist Minden in exploring various strategic
options, including a potential affiliation of Minden with another financial
institution. Therefore, we are familiar with Minden having acted as its
financial advisor in connection with the proposed transaction, and having
participated in the negotiations leading to the Agreement.
During the course of our engagement, we reviewed and analyzed material
bearing upon the financial and operating conditions of Minden and Regions and
material prepared in connection with the proposed transaction, including the
following: the Agreement; certain publicly available information concerning
Minden and Regions, including consolidated financial statements for each for the
three years ended December 31, 1998, respectively, as well as subsequent
quarterly statements for the periods ended March 31, 1999 and June 30, 1999 for
Minden and Regions, respectively; the nature and terms of recent sale and merger
transactions involving banks and bank holding companies that we consider
relevant; historical and current market data for the common stock of Minden and
Regions; and financial and other publicly available information provided to us
by the managements of Minden and Regions.
In addition, we have conducted meetings with members of the senior
management of Minden and Regions for the purpose of reviewing the future
prospects of both companies. We also took into account our assessment of general
economic, market and financial conditions and our experience in other similar
transactions, as well as our overall knowledge of the banking industry and our
general experience in securities valuations.
We have acted as financial advisor to Minden with respect to the proposed
Merger and have received a fee from Minden for our services. We will also
receive an additional fee if the proposed Merger is consummated. Please be
advised that we have no other financial advisory or other relationships with
Minden. In the ordinary course of their businesses, affiliates of Hovde may
actively trade the debt and equity securities of Regions for their own account
or for the accounts of customers and, accordingly, they may at any time hold
long or short positions in such securities.
In rendering this opinion, we have assumed, without independent
verification, the accuracy and completeness of the financial and other
information and representations contained in the publicly available
<PAGE> 102
Board of Directors
Minden Bancshares, Inc.
November , 1999
Page 2
materials provided to us by Minden and Regions, and in the discussions with
management of Minden and Regions.
Based on the foregoing and our experience as investment bankers, we are of
the opinion that, as of the date hereof, the Merger Consideration to be received
by the shareholders of Minden in connection with the Merger as described in the
Agreement is fair to such shareholders from a financial point of view.
Sincerely,
HOVDE FINANCIAL LLC
<PAGE> 103
APPENDIX C
LOUISIANA STATUTES ANNOTATED-REVISED STATUTES 12:131
SEC. 131. RIGHTS OF A SHAREHOLDER DISSENTING FROM CERTAIN CORPORATE ACTIONS
A. Except as provided in subsection B of this section, if a corporation
has, by vote of its shareholders, authorized a sale, lease or exchange of all of
its assets, or has, by vote of its shareholders, become a party to a merger or
consolidation, then, unless such authorization or action shall have been given
or approved by at least eighty per cent of the total voting power, a shareholder
who voted against such corporate action shall have the right to dissent. If a
corporation has become a party to a merger pursuant to R.S. 12:112(H), the
shareholders of any subsidiaries party to the merger shall have the right to
dissent without regard to the proportion of the voting power which approved the
merger and despite the fact that the merger was not approved by vote of the
shareholders of any of the corporations involved.
B. The right to dissent provided by this Section shall not exist in the
case of:
(1) A sale pursuant to an order of a court having jurisdiction in the
premises.
(2) A sale for cash on terms requiring distribution of all or
substantially all of the net proceeds to the shareholders in accordance
with their respective interests within one year after the date of the sale.
(3) Shareholders holding shares of any class of stock which, at the
record date fixed to determine shareholders entitled to receive notice of
and to vote at the meeting of shareholders at which a merger or
consolidation was acted on, were listed on a national securities exchange,
unless the articles of the corporation issuing such stock provide otherwise
or the shares of such shareholders were not converted by the merger or
consolidation solely into shares of the surviving or new corporation.
C. Except as provided in the last sentence of this subsection, any
shareholder electing to exercise such right of dissent shall file with the
corporation, prior to or at the meeting of shareholders at which such proposed
corporate action is submitted to a vote, a written objection to such proposed
corporate action, and shall vote his shares against such action. If such
proposed corporate action be taken by the required vote, but by less than eighty
per cent of the total voting power, and the merger, consolidation or sale, lease
or exchange of assets authorized thereby be effected, the corporation shall
promptly thereafter give written notice thereof, by registered mail, to each
shareholder who filed such written objection to, and voted his shares against,
such action, at such shareholder's last address on the corporation's records.
Each such shareholder may, within twenty days after the mailing of such notice
to him, but not thereafter, file with the corporation a demand in writing for
the fair cash value of his shares as of the day before such vote was taken;
provided that he state in such demand the value demanded, and a post office
address to which the reply of the corporation may be sent, and at the same time
deposit in escrow in a chartered bank or trust company located in the parish of
the registered office of the corporation, the certificates representing his
shares, duly endorsed and transferred to the corporation upon the sole condition
that said certificates shall be delivered to the corporation upon payment of the
value of the shares determined in accordance with the provisions of this
section. With his demand the shareholder shall deliver to the corporation, the
written acknowledgment of such bank or trust company that it so holds his
certificates of stock. Unless the objection, demand and acknowledgment aforesaid
be made and delivered by the shareholder within the period above limited, he
shall conclusively be presumed to have acquiesced in the corporate action
proposed or taken. In the case of a merger pursuant to R.S. 12:112(H), the
dissenting shareholder need not file an objection with the corporation nor vote
against the merger, but need only file with the corporation, within twenty days
after a copy of the merger certificate was mailed to him, a demand in writing
for the cash value of his shares as of the day before the certificate was filed
with the secretary of state, state in such demand the value demanded and a post
office address to which the corporation's reply may be sent, deposit the
certificates representing his shares in escrow as hereinabove provided, and
deliver to the corporation with his demand the acknowledgment of the escrow bank
or trust company as hereinabove prescribed.
D. If the corporation does not agree to the value so stated and demanded,
or does not agree that a payment is due, it shall, within twenty days after
receipt of such demand and acknowledgment, notify in writing the shareholder, at
the designated post office address, of its disagreement, and shall state in such
notice
C-1
<PAGE> 104
the value it will agree to pay if any payment should be held to be due;
otherwise it shall be liable for, and shall pay to the dissatisfied shareholder,
the value demanded by him for his shares.
E. In case of disagreement as to such fair cash value, or as to whether any
payment is due, after compliance by the parties with the provisions of
subsections C and D of this section, the dissatisfied shareholder, within sixty
days after receipt of notice in writing of the corporation's disagreement, but
not thereafter, may file suit against the corporation, or the merged or
consolidated corporation, as the case may be, in the district court of the
parish in which the corporation or the merged or consolidated corporation, as
the case may be, has its registered office, praying the court to fix and decree
the fair cash value of the dissatisfied shareholder's shares as of the day
before such corporate action complained of was taken, and the court shall, on
such evidence as may be adduced in relation thereto, determine summarily whether
any payment is due, and, if so, such cash value, and render judgment
accordingly. Any shareholder entitled to file such suit may, within such
sixty-day period but not thereafter, intervene as a plaintiff in such suit filed
by another shareholder, and recover therein judgment against the corporation for
the fair cash value of his shares. No order or decree shall be made by the court
staying the proposed corporate action, and any such corporate action may be
carried to completion notwithstanding any such suit. Failure of the shareholder
to bring suit, or to intervene in such a suit, within sixty days after receipt
of notice of disagreement by the corporation shall conclusively bind the
shareholder (1) by the corporation's statement that no payment is due, or (2) if
the corporation does not contend that no payment is due, to accept the value of
his shares as fixed by the corporation in its notice of disagreement.
F. When the fair value of the shares has been agreed upon between the
shareholder and the corporation, or when the corporation has become liable for
the value demanded by the shareholder because of failure to give notice of
disagreement and of the value it will pay, or when the shareholder has become
bound to accept the value the corporation agrees is due because of his failure
to bring suit within sixty days after receipt of notice of the corporation's
disagreement, the action of the shareholder to recover such value must be
brought within five years from the date the value was agreed upon, or the
liability of the corporation became fixed.
G. If the corporation or the merged or consolidated corporation, as the
case may be, shall, in its notice of disagreement, have offered to pay to the
dissatisfied shareholder on demand an amount in cash deemed by it to be the fair
cash value of his shares, and if, on the institution of a suit by the
dissatisfied shareholder claiming an amount in excess of the amount so offered,
the corporation, or the merged or consolidated corporation, as the case may be,
shall deposit in the registry of the court, there to remain until the final
determination of the cause, the amount so offered, then, if the amount finally
awarded such shareholder, exclusive of interest and costs, be more than the
amount offered and deposited as aforesaid, the costs of the proceeding shall be
taxed against the corporation, or the merged or consolidated corporation, as the
case may be; otherwise the costs of the proceeding shall be taxed against such
shareholder.
H. Upon filing a demand for the value of his shares, the shareholder shall
cease to have any of the rights of a shareholder except the rights accorded by
this section. Such a demand may be withdrawn by the shareholder at any time
before the corporation gives notice of disagreement, as provided in subsection D
of this section. After such notice of disagreement is given, withdrawal of a
notice of election shall require the written consent of the corporation. If a
notice of election is withdrawn, or the proposed corporate action is abandoned
or rescinded, or a court shall determine that the shareholder is not entitled to
receive payment for his shares, or the shareholder shall otherwise lose his
dissenter's rights, he shall not have the right to receive payment for his
shares, his share certificates shall be returned to him (and, on his request,
new certificates shall be issued to him in exchange for the old ones endorsed to
the corporation), and he shall be reinstated to all his rights as a shareholder
as of the filing of his demand for value, including any intervening preemptive
rights, and the right to payment of any intervening dividend or other
distribution, or, if any such rights have expired or any such dividend or
distribution other than in cash has been completed, in lieu thereof, at the
election of the corporation, the fair value thereof in cash as determined by the
board as of the time of such expiration or completion, but without prejudice
otherwise to any corporate proceedings that may have been taken in the interim.
C-2
<PAGE> 105
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Article Tenth of the Certificate of Incorporation of the Registrant
provides:
"(a) The corporation shall indemnify its officers, directors,
employees, and agents to the full extent permitted by the General
Corporation Law of Delaware. (b) No director of the corporation shall be
personally liable to the corporation or its stockholders for monetary
damages, for breach of fiduciary duty as a director, except for liability
(i) for any breach of the director's duty of loyalty to the corporation or
its stockholders; (ii) for acts or omissions not in good faith or which
involve intentional misconduct or a knowing violation of law; (iii) under
Section 174 of the Delaware General Corporation Law; or (iv) for any
transaction from which the director derived an improper personal benefit."
Section 145 of the Delaware General Corporation law empowers the Registrant
to indemnify its officers and directors under certain circumstances. The
pertinent provisions of that statute read as follows:
"(a) A corporation may indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the corporation)
by reason of the fact that he is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorneys' fees), judgments, fines and amounts
paid in settlement actually and reasonably incurred by him in connection
with such action, suit or proceeding if he acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful.
The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its
equivalent, shall not, of itself, create a presumption that the person did
not act in good faith and in a manner which he reasonably believed to be
in or not opposed to the best interests of the corporation, and, with
respect to any criminal action or proceeding, had reasonable cause to
believe that his conduct was unlawful.
"(b) A corporation may indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed
action or suit by or in the right of the corporation to procure a judgment
in its favor by reason of the fact that he is or was a director, officer,
employee or agent of the corporation, or is or was serving at the request
II-1
<PAGE> 106
of the corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise against
expenses (including attorneys' fees) actually and reasonably incurred by
him in connection with the defense or settlement of such action or suit if
he acted in good faith and in a manner he reasonably believed to be in or
not opposed to the best interests of the corporation and except that no
indemnification shall be made in respect of any claim, issue or matter as
to which such person shall have been adjudged to be liable to the
corporation unless and only to the extent that the Court of Chancery or
the court in which such action or suit was brought shall determine upon
application that, despite the adjudication of liability but in view of all
the circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expenses which the Court of Chancery or
such other court shall deem proper.
"(c) To the extent that a director, officer, employee or agent of a
corporation has been successful on the merits or otherwise in defense of
any action, suit or proceeding referred to in subsections (a) and (b) of
this section, or in defense of any claim, issue or matter therein, he
shall be indemnified against expenses (including attorneys' fees) actually
and reasonably incurred by him in connection therewith.
"(d) Any indemnification under subsections (a) and (b) of this section
(unless ordered by a court) shall be made by the corporation only as
authorized in the specific case upon a determination that indemnification
of the director, officer, employee or agent is proper in the circumstances
because he has met the applicable standard of conduct set forth in
subsections (a) and (b) of this section. Such determination shall be made
(1) by a majority vote of the directors who are not parties to such
action, suit or proceeding, even though less than a quorum, or (2) if
there are no such directors, or if such directors so direct, by
independent legal counsel in a written opinion, or (3) by the
stockholders.
"(e) Expenses (including attorneys' fees) incurred by an officer or
director in defending any civil, criminal, administrative or investigative
action, suit or proceeding may be paid by the corporation in advance of
the final disposition of such action, suit or proceeding upon receipt of
an undertaking by or on behalf of such director or officer to repay such
amount if it shall ultimately be determined that he is not entitled to be
indemnified by the corporation as authorized in this section. Such
expenses (including attorneys' fees) incurred by other employees and
agents may be so paid upon such terms and conditions, if any, as the board
of directors deems appropriate.
"(f) The indemnification and advancement of expenses provided by, or
granted pursuant to, the other subsections of this section shall not be
deemed exclusive of any other rights to which those seeking
indemnification or advancement of expenses may be entitled under any
bylaw, agreement, vote of stockholders or disinterested directors or
otherwise, both as to action in his official capacity and as to action in
another capacity while holding such office.
II-2
<PAGE> 107
"(g) A corporation shall have power to purchase and maintain insurance
on behalf of any person who is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise against
any liability asserted against him and incurred by him in any such
capacity, or arising out of his status as such, whether or not the
corporation would have the power to indemnify him against such liability
under this section.
"(h) For purposes of this section, references to "the corporation"
shall include, in addition to the resulting corporation, any constituent
corporation (including any constituent of a constituent) absorbed in a
consolidation or merger which, if its separate existence had continued,
would have had power and authority to indemnify its directors, officers,
and employees or agents, so that any person who is or was a director,
officer, employee or agent of such constituent corporation, or is or was
serving at the request of such constituent corporation as a director,
officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, shall stand in the same position under
this section with respect to the resulting or surviving corporation as he
would have with respect to such constituent corporation if its separate
existence had continued.
"(i) For purposes of this section, references to "other enterprises"
shall include employee benefit plans; references to "fines" shall include
any excise taxes assessed on a person with respect to any employee benefit
plan; and references to "serving at the request of the corporation" shall
include any service as a director, officer, employee or agent of the
corporation which imposes duties on, or involves services by, such
director, officer, employee or agent with respect to an employee benefit
plan, its participants or beneficiaries; and a person who acted in good
faith and in a manner he reasonably believed to be in the interest of the
participants and beneficiaries of an employee benefit plan shall be deemed
to have acted in a manner "not opposed to the best interests of the
corporation" as referred to in this section.
"(j) The indemnification and advancement of expenses provided by, or
granted pursuant to, this section shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a
director, officer, employee or agent and shall inure to the benefit of the
heirs, executors and administrators of such a person.
"(k) The Court of Chancery is hereby vested with exclusive jurisdiction
to hear and determine all actions for advancement of expenses or
indemnification brought under this section or under any bylaw, agreement,
vote of stockholders or disinterested directors, or otherwise. The Court
of Chancery may summarily determine a corporation's obligation to advance
expenses (including attorneys' fees)."
The Registrant has purchased a directors' and officers' liability insurance
contract which provides, within stated limits, reimbursement either to a
II-3
<PAGE> 108
director or officer whose actions in his capacity result in liability, or to
the Registrant, in the event it has indemnified the director or officer. Major
exclusions from coverage include libel, slander, personal profit based on
inside information, illegal payments, dishonesty, accounting of securities
profits in violation of Section 16(b) of the Securities Exchange Act of 1934
and acts within the scope of the Pension Reform Act of 1974.
ITEM 21. EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------ -----------------------------------------------------------------------------------------------
<S> <C> <C>
2.1 -- Agreement and Plan of Merger, dated as of July 13, 1999, by and between Minden Bancshares, Inc. and
Regions Financial Corporation -- included as Appendix A to the Proxy Statement/Prospectus.
4.1 -- Certificate of Incorporation of Regions Financial Corporation -- incorporated by reference from S-4
Registration Statement of Regions Financial Corporation, file no. 333-86975.
4.2 -- By-laws of Regions Financial Corporation -- incorporated by reference from S-4 Registration Statement of
Regions Financial Corporation, file no. 333-86975.
5. -- Form of opinion re: legality.
8. -- Form of opinion re: tax matters.
23.1 -- Consent of Ernst & Young LLP.
23.2 -- Consent of Hovde Financial LLC -- to be filed by amendment.
23.3 -- Consent of Lange, Simpson, Robinson & Somerville LLP -- to be included in Exhibit 5.
23.4 -- Consent of Alston & Bird LLP -- to be included in Exhibit 8.
23.5 -- Consent of Heard, McElroy & Vestal, L.L.P.
24.1 -- Power of Attorney
99. -- Form of proxy.
</TABLE>
ITEM 22. UNDERTAKINGS.
A. The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934, (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
B. Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the
II-4
<PAGE> 109
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
C.(1) The undersigned Registrant hereby undertakes as follows: that prior
to any public reoffering of the securities registered hereunder through use of
a prospectus which is a part of this registration statement, by any person or
party who is deemed to be an underwriter within the meaning of Rule 145(c), the
issuer undertakes that such reoffering prospectus will contain the information
called for by the applicable registration form with respect to reofferings by
persons who may be deemed underwriters, in addition to the information called
for by the other items of the applicable form.
(2) The Registrant undertakes that every prospectus: (i) that is filed
pursuant to paragraph (1) immediately preceding, or (ii) that purports to meet
the requirements of Section 10(a)(3) of the Act and is used in connection with
an offering of securities subject to Rule 415, will be filed as a part of an
amendment to the registration statement and will not be used until such
amendment is effective, and that, for purposes of determining any liability
under the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
D. The undersigned Registrant hereby undertakes to respond to requests for
information that is incorporated by reference into the prospectus pursuant to
Item 4, 10(b), 11, or 13 of this form, within one business day of receipt of
such request, and to send the incorporated documents by first class mail or
other equally prompt means. This includes information contained in documents
filed subsequent to the effective date of the registration statement through
the date of responding to the request.
E. The undersigned Registrant hereby undertakes to supply by means of a
post-effective amendment all information concerning a transaction, and the
company being acquired involved therein, that was not the subject of and
included in the registration statement when it became effective.
II-5
<PAGE> 110
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Birmingham, State of
Alabama on this the 17th day of November, 1999.
REGISTRANT:
REGIONS FINANCIAL CORPORATION
BY: /s/ Richard D. Horsley
------------------------------
Richard D. Horsley
Vice Chairman of the Board and
Executive Financial Officer
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the date indicated.
SIGNATURE TITLE DATE
--------- ----- ----
*
- --------------------------- President and Chief Executive November 17, 1999
Carl E. Jones, Jr. Officer and Director
(principal executive officer)
/s/ Richard D. Horsley
- --------------------------- Vice Chairman of the Board and November 17, 1999
Richard D. Horsley Executive Financial Officer
and Director
(principal financial officer)
*
- --------------------------- Executive Vice President and November 17, 1999
Robert P. Houston Comptroller
(principal accounting officer)
*
- --------------------------- Director November 17, 1999
Sheila S. Blair
*
- --------------------------- Director November 17, 1999
James B. Boone, Jr.
*
- --------------------------- Director November 17, 1999
James S.M. French
*
- --------------------------- Director November 17, 1999
Olin B. King
*
- --------------------------- Chairman of the Board November 17, 1999
J. Stanley Mackin and Director
*
- --------------------------- Director November 17, 1999
Michael W. Murphy
*
- --------------------------- Director November 17, 1999
Henry E. Simpson
*
- --------------------------- Director November 17, 1999
Lee J. Styslinger, Jr.
*
- --------------------------- Director November 17, 1999
W. Woodrow Stewart
*
- --------------------------- Director November 17, 1999
John H. Watson
*
- --------------------------- Director November 17, 1999
Robert J. Williams
*
- --------------------------- Director November 17, 1999
C. Kemmons Wilson, Jr.
* By /s/ Richard D. Horsley as attorney-in-fact November 17, 1999
pursuant to a power of attorney.
<PAGE> 111
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT NUMBERED
NUMBER DESCRIPTION PAGE
- ------- ------------------------------------------------------------------------------------------------------ ----------
<S> <C> <C> <C>
2.1 -- Agreement and Plan of Merger, dated as of July 13, 1999, by and between Minden Bancshares, Inc. and
Regions Financial Corporation -- included as Appendix A to the Proxy Statement/Prospectus.
4.1 -- Certificate of Incorporation of Regions Financial Corporation -- incorporated by reference from S-4
Registration Statement of Regions Financial Corporation, file no. 333-86975.
4.2 -- By-laws of Regions Financial Corporation -- incorporated by reference from S-4 Registration Statement
of Regions Financial Corporation, file no. 333-86975.
5. -- Form of opinion re: legality.
8. -- Form of opinion re: tax matters.
23.1 -- Consent of Ernst & Young LLP.
23.2 -- Consent of Hovde Financial LLC -- to be filed by amendment.
23.3 -- Consent of Lange, Simpson, Robinson & Somerville LLP -- to be included in Exhibit 5.
23.4 -- Consent of Alston & Bird LLP -- to be included in Exhibit 8.
23.5 -- Consent of Heard, McElroy & Vestal, L.L.P.
24.1 -- Power of Attorney
99. -- Form of proxy.
</TABLE>
<PAGE> 1
EXHIBIT 5
[Letterhead of Lange, Simpson, Robinson & Somerville LLP]
November 18, 1999
Regions Financial Corporation
417 North 20th Street
Birmingham, Alabama 35203
Re: Regions Financial Corporation
S-4 Registration Statement
Acquisition of Minden Bancshares, Inc.
Ladies and Gentlemen:
We have acted as counsel for Regions Financial Corporation, a Delaware
corporation ("Regions") in connection with the merger of Minden Bancshares, Inc.
("Minden Bancshares") with and into Regions (the "Merger") and in connection
with the registration of shares of common stock of Regions, par value $.625 per
share ("Regions Common Stock"), on Form S-4 under the Securities Act of 1933.
The Merger provides for issuance of shares of common stock of Regions, par value
$.625 per share, to the stockholders of Minden Bancshares upon consummation of
the Merger. The maximum number of shares of Regions to be issued in the Merger
is estimated to be 2,523,606.
We have examined and are familiar with the registration statement on Form
S-4 filed with the Securities and Exchange Commission, as such registration
statement has been amended to date. We have examined and are familiar with the
records relating to the organization of Regions and the documents and records
as we have deemed relevant for purposes of rendering this opinion.
Based on the foregoing it is our opinion that upon satisfaction of the
conditions precedent to consummation of the Merger, or waiver of such conditions
capable of being waived, and upon consummation of the Merger, the shares of
Regions Common Stock issued pursuant to the Merger will be duly authorized,
validly issued and outstanding, fully paid and non-assessable, with no personal
liability attaching to the ownership thereof.
We hereby consent to the filing of this opinion as an exhibit to the
registration statement and to the reference to Lange, Simpson, Robinson &
Somerville LLP under the caption "Opinions" in the proxy statement/prospectus
forming a part of the registration statement.
Very truly yours,
<PAGE> 1
EXHIBIT 8
ALSTON & BIRD LLP [LOGO]
3605 Glenwood Avenue, Suite 310
P. O. Drawer 31107
Raleigh, NC 27622-1107
919-420-2200
Fax: 919-420-2260
www.alston.com
JASPER L. CUMMINGS, JR.
DIRECT DIAL: 919-420-2208
E-MAIL: [email protected]
November __, 1999
Regions Financial Corporation
417 North 20th Street
Birmingham, Alabama 35203
Re: Registration Statement on Form S-4 with respect to shares
issued pursuant to the Agreement and Plan of Merger by and
between Minden Bancshares, Inc. and Regions Financial
Corporation dated as of July 13, 1999.
Ladies and Gentlemen:
We have acted as counsel to Regions Financial Corporation ("Regions")
in connection with the registration of ___ shares of its Common Stock, par value
$____ per share (the "Regions Common Stock"), issuable pursuant to the
Agreement, as set forth in the Registration Statement that is being filed on the
date hereof by Regions with the Securities and Exchange Commission (the
"Commission") pursuant to the requirements of item 21(a) of Form S-4 and item
601(b)(8) of Regulation S-K. All capitalized terms not otherwise defined herein
shall have the meanings given to the in the Agreement.
Pursuant to the Merger, and as more fully described in the Agreement,
at the Effective Time, each share of Minden Common Stock issued and outstanding
at the Effective Time shall be converted into 8.0 shares of Regions Common
Stock. As a result, stockholders of Minden shall become stockholders of Regions
and each of the subsidiaries of Minden shall continue to conduct its business
and operations as a subsidiary of Regions. All terms used herein without
definition shall have the respective meanings specified in the Agreement, and
unless otherwise specified, all section references herein are to the Internal
Revenue Code of 1986, as amended (the "Code").
In rendering the opinions expressed herein, we have examined such
documents as we deemed appropriate, including (i) the Agreement and (ii) the
Registration Statement on Form S-4 filed by Regions with the Securities and
Exchange Commission under the Securities Act of 1933, on November __, 1999, as
amended, including the Proxy Statement/Prospectus constituting part thereof
(together the ""Registration Statement"). In rendering the opinions expressed
herein, we have assumed with the consent of Regions and Minden, that the
Agreement and the Registration Statement accurately and
<PAGE> 2
Regions Financial Corporation
November __, 1999
Page 2
completely describe the Merger and that the Merger will be consummated in
accordance with the Agreement and as described in the Registration Statement.
In rendering the opinions expressed herein, we have also relied with
the consent of Regions and Minden, upon the accuracy and completeness of the
factual statements and factual representations (which factual statements and
factual representations we have neither investigated nor verified) contained in
the certificates of Regions and Minden to us dated as of the date herein
(together, the "Certificates"), which we have assumed are complete and accurate
as of the date hereof and will be complete and accurate as of the date on which
the Merger is consummated.
Based on the foregoing, we are of the opinion that, under presently
applicable Federal income tax law:
(1) The Merger will constitute a reorganization within the meaning
of Section 368(a) of the Code, and Minden and Regions will
each be a party to the reorganization within the meaning of
Section 368(b) of the Code.
(2) No gain or loss will be recognized by holders of Minden Common
Stock upon the exchange in the Merger of all of their Minden
Common Stock solely for shares of Regions Common Stock (except
with respect to any cash received in lieu of a fractional
share interest in Regions Common Stock).
(3) The aggregate tax basis of the Regions Common Stock received
by holders of Minden Common Stock who exchange all of their
Minden Common Stock solely for Regions Common Stock in the
Merger will be the same as the tax basis of the Minden Common
Stock surrendered in exchange therefor, less the basis of any
fractional share of Regions Common Stock settled by cash
payment.
(4) The holding period of the Regions Common Stock received by
holders who exchange all of their Minden Common Stock solely
for Regions Common Stock in the Merger will include the
holding period of the Minden Common Stock surrendered in
exchange therefor, provided that such Minden Common Stock is
held as a capital asset at the Effective Time.
(5) The payment of cash to holders of Minden Common Stock in lieu
of fractional share interests of Regions Common Stock will be
treated for Federal income tax purposes as if the fractional
shares were distributed as part of the exchange and then were
redeemed by Regions. These cash payments will be treated as
having been received as distributions in full
<PAGE> 3
Regions Financial Corporation
November ___, 1999
Page 3
payment in exchange for the Regions Common Stock redeemed, as
provided in Section 302(a) of the Code.
(6) Where solely cash is received by a holder of Minden Common
Stock in exchange for Minden Common Stock pursuant to the
exercise of dissenters' rights, such cash will be treated as
having been received in redemption of such holder's Minden
Common Stock, subject to the provisions and limitations of
Section 302 of the Code.
The opinions expressed herein are based upon existing statutory,
regulatory, and judicial authority, any of which may be changed at any time with
retroactive effect. The Federal income tax consequences described herein may not
apply to certain shareholders of Minden with special situations, including,
without limitation, shareholders who hold their Minden Common Stock other than
as a capital asset, who received their Minden Common Stock upon the exercise of
employee stock options or otherwise as compensation, who hold their Minden
Common Stock as part of a "straddle" or "conversion transaction" for Federal
income tax purposes, or are foreign persons, insurance companies, or securities
dealers.
In addition, our opinions are based solely on the documents that we
have examined, and the factual statements and factual representations set out in
the Certificates, which we have assumed were true on the date of the
Certificates, and are true on the date hereof. Our opinions cannot be relied
upon if any of the facts pertinent to the Federal income tax treatment of the
Merger stated in such documents or any of the factual statements or factual
representations set out in the Certificates is, or later becomes, inaccurate.
Our opinions are limited to the tax matters specifically covered thereby, and we
have not been asked to address, nor have we addressed, any other tax
consequences of the Merger, including for example any issues related to
intercompany transactions, accounting methods, or changes in accounting methods
resulting from the Merger, or the consequences of the Merger under state, local
or foreign law. These opinions are provided solely for the benefit and use of
Regions and Minden. No other party or person is entitled to rely on the
opinions.
In accordance with the requirements of Item 601(b)(23) of Regulation
S-K under the Securities Act, we hereby consent to the discussion of this
opinion in the Proxy Statement Prospectus filed by Regions, to the filing of
this opinion as an exhibit to the Registration Statement and to the reference to
our firm under the headings "SUMMARY-Federal Income Tax Consequences" and "THE
MERGER-Material Federal Income Tax Consequences of the Merger" in the
Registration Statement. In giving such consent, we do not thereby admit that we
are in the category of such persons whose consent is
<PAGE> 4
Regions Financial Corporation
November ___, 1999
Page 4
required under Section 7 of the Securities Act or the rules and regulations of
the Commission thereunder.
Very truly yours,
ALSTON & BIRD LLP
Jasper L. Cummings, Jr.
A partner of the firm
JLC:jm
Enclosure
<PAGE> 1
EXHIBIT 23.1
CONSENT OF ERNST & YOUNG LLP
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-4) and related Prospectus of Regions Financial
Corporation for the registration of up to 2,523,606 shares of its common stock
and to the incorporation by reference therein of our report dated March 11,
1999, with respect to the consolidated financial statements of Regions Financial
Corporation incorporated by reference in its Annual Report (Form 10-K) for the
year ended December 31, 1998, filed with the Securities and Exchange Commission.
/s/ ERNST & YOUNG LLP
Birmingham, Alabama
November 18, 1999
<PAGE> 1
EXHIBIT 23.5
CONSENT OF INDEPENDENT AUDITORS
As independent public accountants, we hereby consent to the incorporation
by reference in this Registration Statement on Form S-4 of our report dated
January 13, 1999 on the consolidated financial statements of Minden Bancshares,
Inc. and Subsidiary as of December 31, 1998 and 1997 and for each of the years
in the three-year period year ended December 31, 1998 and to all references to
our Firm included in this Registration Statement.
/s/ Heard, McElroy & Vestal, L.L.P.
Shreveport, Louisiana
November 15, 1999
<PAGE> 1
EXHIBIT 24.1
REGIONS FINANCIAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that the undersigned directors and officers
of REGIONS FINANCIAL CORPORATION (the "Corporation") hereby constitute and
appoint Richard D. Horsley and Samuel E. Upchurch, Jr., and each of them, the
true and lawful agent and attorney-in-fact of the undersigned, with full power
of substitution and resubstitution, and with full power and authority in said
agents and attorneys-in-fact, and in any one of them, to sign for the
undersigned and in their respective names as directors and officers of the
Corporation, one or more Registration Statements to be filed with the Securities
and Exchange Commission under the Securities Act of 1933, as amended, relating
to the acquisition of Minden Bancshares, Inc. by Regions Financial Corporation
and to sign any and all amendments to such Registration Statements.
SIGNATURE TITLE DATE
--------- ----- ----
/s/ Carl E. Jones, Jr.
- --------------------------- President and Chief Executive July 21, 1999
Carl E. Jones, Jr. Officer and Director
(principal executive officer)
/s/ Richard D. Horsley
- --------------------------- Vice Chairman of the Board and July 21, 1999
Richard D. Horsley Executive Financial Officer
and Director
(principal financial officer)
/s/ Robert P. Houston
- --------------------------- Executive Vice President and July 21, 1999
Robert P. Houston Comptroller
(principal accounting officer)
/s/ Sheila S. Blair
- --------------------------- Director July 21, 1999
Sheila S. Blair
/s/ James B. Boone, Jr.
- --------------------------- Director July 21, 1999
James B. Boone, Jr.
/s/ James S.M. French
- --------------------------- Director July 21, 1999
James S.M. French
/s/ Olin B. King
- --------------------------- Director July 21, 1999
Olin B. King
/s/ J. Stanley Mackin
- --------------------------- Chairman of the Board July 21, 1999
J. Stanley Mackin and Director
/s/ Michael W. Murphy
- --------------------------- Director July 21, 1999
Michael W. Murphy
<PAGE> 2
/s/ Henry E. Simpson
- --------------------------- Director July 21, 1999
Henry E. Simpson
/s/ Lee J. Styslinger, Jr.
- --------------------------- Director July 21, 1999
Lee J. Styslinger, Jr.
/s/ W. Woodrow Stewart
- --------------------------- Director July 21, 1999
W. Woodrow Stewart
/s/ John H. Watson
- --------------------------- Director July 21, 1999
John H. Watson
/s/ Robert J. Williams
- --------------------------- Director July 21, 1999
Robert J. Williams
/s/ C. Kemmons Wilson, Jr.
- --------------------------- Director July 21, 1999
C. Kemmons Wilson, Jr.
<PAGE> 1
MINDEN BANCSHARES, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned stockholder hereby appoints ,
, and , and each or any one of them, with full power
of substitution, as Proxies to represent and to vote as designated below, all
the shares of common stock of Minden Bancshares, Inc. (the "Company") held of
record by the undersigned on , 1999, at the Special Meeting of
Stockholders (the "Special Meeting") to be held on , 1999, or any
adjournments thereof.
1. Proposal to approve the Agreement and Plan of Merger, dated as of July 13,
1999, (the "Agreement"), by and between the Company and Regions Financial
Corporation ("Regions") pursuant to which the Company will merge with and
into Regions and each share of the Company's common stock (except for
certain shares held by the Company, Regions, or their respective
subsidiaries) will be converted into 8.0 shares of Regions common stock,
subject to possible adjustment, and under such other terms and conditions as
are set forth in the Agreement:
[ ] FOR [ ] AGAINST [ ] ABSTAIN
2. To transact such other business as may properly come before the meeting or
any adjournment thereof.
This proxy when properly executed will be voted in the manner directed
herein by the undersigned stockholder, and in the discretion of the persons
named as Proxies on all other matters which may properly come before the Special
Meeting or any adjournment thereof. If no direction is made, this proxy will be
voted in favor of Proposal 1.
(Reverse)
This Proxy revokes all prior with respect to the Special Meeting and may be
revoked prior to its exercise.
Please date and sign exactly as name appears on your stock certificate. When
shares are held by joint tenants, both should sign. When signing as attorney,
executor, administrator, trustee or guardian, please give full title as such. If
a corporation, please sign in full corporate name by president or other
authorized officer. If a partnership, please sign in partnership name by
authorized person.
Dated: , 1999
------------------------------
------------------------------
(Print Name of Stockholder)
------------------------------
(Signature of Stockholder)
------------------------------
(Print Name of Stockholder)
------------------------------
(Signature of Stockholder)
PLEASE MARK, DATE, SIGN AND MAIL THIS PROXY PROMPTLY IN THE ENCLOSED
POSTAGE-PREPAID ENVELOPE.
