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Registration No. 33-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
FORM S-4
REGISTRATION STATEMENT
Under The Securities Act of 1933
----------------
BANC ONE CORPORATION
(Exact name of Registrant as specified in its charter)
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OHIO 6711 31-0738296
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification No.)
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100 EAST BROAD STREET
COLUMBUS, OHIO 43271
(614) 248-5944
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)
----------------
STEVEN ALAN BENNETT, ESQ.
BANC ONE CORPORATION
100 EAST BROAD STREET
COLUMBUS, OHIO 43271-0158
(614) 248-7590
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
With Copies to:
KENNETH L. WAGNER L. RICHARDS MCMILLAN, II
ASSOCIATE COUNSEL JONES, WALKER, WAECHTER, POITEVENT,
BANC ONE CORPORATION CARRERE & DENEGRE, L.L.P.
100 EAST BROAD STREET PLACE ST. CHARLES
COLUMBUS, OHIO 43271-0158 201 ST. CHARLES AVENUE
NEW ORLEANS, LOUISIANA 70170-5100
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Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of this Registration Statement and all
other conditions to the merger of Premier Bancorp, Inc. with and into a wholly
owned subsidiary of the Registrant pursuant to the Merger Agreement described
in the enclosed Prospectus and Proxy Statement have been satisfied or waived.
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
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PROPOSED PROPOSED
TITLE OF EACH CLASS AMOUNT TO MAXIMUM MAXIMUM AMOUNT OF
OF SECURITIES TO BE BE REGISTERED OFFERING PRICE AGGREGATE REGISTRATION
REGISTERED (1) (3) PER UNIT (2) OFFERING PRICE FEE (3)(4)
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Common Stock 17,795,840 $35.61 $633,709,863 $218,521
</TABLE>
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(1) Based on an estimate of the maximum number of shares of common stock of
the Registrant to be issued in connection with the merger (the "Merger")
of Premier Bancorp, Inc. ("Premier") with and into a wholly owned
subsidiary of the Registrant, less the number of shares of common stock
carried forward to this Registration Statement pursuant to Rule 429. See
note 3.
(2) Calculated in accordance with Rule 457(f)(1) based on the aggregate market
value on October 2, 1995 of the shares of Premier common stock expected to
be canceled in connection with the Merger and computed by dividing, (i)
the product of (A) the average of the high and low prices of Premier
common stock as reported by The Nasdaq Stock Market on October 2, 1995 and
(B) 35,388,832, representing the maximum number of shares of Premier
common stock expected to be canceled in connection with the Merger, by
(ii) 21,861,840, representing the maximum number of shares of common stock
of the Registrant to be issued in connection with the Merger.
(3) In accordance with Rule 429, the Prospectus included herein is a combined
prospectus that also relates to the Registrant's Registration Statement on
Form S-4, File No. 33-41851 (the "Prior Registration Statement"). The
amount of securities eligible to be sold under the Prior Registration
Statement (4,066,000 shares of the Registrant's common stock) shall be
carried forward to this Registration Statement. The amount of the filing
fee associated with such securities that was previously paid with the
Prior Registration Statement is $37,537.
(4) In accordance with Rule 457(b), $153,088 previously paid in connection
with filing of the Proxy Statement/Prospectus included herewith as
preliminary proxy material has been credited against the registration fee
of $218,521, leaving $65,433 payable in connection with the filing of this
Registration Statement.
----------------
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 THIS REGISTRATION
STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
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BANC ONE CORPORATION
CROSS REFERENCE SHEET
<TABLE>
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CAPTION IN PROSPECTUS
ITEM OF FORM S-4 AND PROXY STATEMENT
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A. Information about the Transaction
---------------------------------
Item 1--Forepart of Registration
Statement and Outside Front
Cover Page of Prospectus........ Facing Page; Outside Front Cover Page;
Cross Reference Sheet
Item 2--Inside Front and Outside
Back Cover Pages
of Prospectus................... Available Information; Incorporation
by Reference; Table of Contents
Item 3--Risk Factors, Ratio of
Earnings to Fixed Charges and
Other Information............... Summary
Item 4--Terms of the Transaction. Merger; Comparative Rights of
Shareholders
Item 5--Pro Forma Financial
Information..................... *
Item 6--Material Contacts with
the Company Being Acquired...... Merger
Item 7--Additional Information
Required for Reoffering by
Persons and Parties Deemed To Be
Underwriters.................... *
Item 8--Interests of Named
Experts and Counsel............. Miscellaneous Information
Item 9--Disclosure of Commission
Position on Indemnification for
Securities Act Liabilities...... *
B. Information about the Registrant
---------------------------------
Item 10--Information with Respect
to S-3 Registrants.............. Information about BANC ONE
CORPORATION; Comparative Rights of
Shareholders
Item 11--Incorporation of Certain
Information by Reference........ Incorporation by Reference;
Information about BANC ONE
CORPORATION
Item 12--Information with Respect
to S-2 or S-3 Registrants....... *
Item 13--Incorporation of Certain
Information by Reference........ *
Item 14--Information with Respect
to Registrants Other Than S-2 or
S-3 Registrants................. *
C. Information about the Company
-----------------------------
Being Acquired
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Item 15--Information with Respect
to S-3 Companies................ Incorporation by Reference;
Information About Premier Bancorp,
Inc.
Item 16--Information with Respect
to S-2 or S-3 Companies......... *
Item 17--Information with Respect
to Companies Other Than S-2 or
S-3 Companies................... *
D. Voting and Management Information
---------------------------------
Item 18--Information if Proxies,
Consents or Authorizations Are
To Be Solicited................. Summary; The Special Meeting; Voting
and Management Information
Item 19--Information if Proxies,
Consents or Authorizations Are
Not To Be Solicited or in an
Exchange Offer.................. *
</TABLE>
* Omitted because item is inapplicable or answer to item is negative
<PAGE>
PREMIER BANCORP, INC.
451 FLORIDA STREET
BATON ROUGE, LOUISIANA 70801
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON NOVEMBER 17, 1995
To the shareholders of Premier Bancorp, Inc.:
Notice is hereby given that a special meeting of shareholders of Premier
Bancorp, Inc. ("PREMIER") will be held on November 17, 1995 at 9:00 a.m. local
time in the auditorium on the 8th floor of the Premier Centre Building, 450
Laurel Street, Baton Rouge, Louisiana, to consider and vote upon the following
matters:
(i) A proposal to approve an Agreement and Plan of Merger between PREMIER,
BANC ONE CORPORATION ("BANC ONE") and PREMIER ACQUISITION CORPORATION,
a wholly owned subsidiary of BANC ONE ("PAC"), pursuant to which
PREMIER will merge (the "Merger") with and into PAC and each
outstanding share of PREMIER common stock (together with any and all
PREMIER common stock purchase rights issued under the PREMIER rights
plan) will be converted into 0.617761 share of BANC ONE common stock.
(ii) Such other business as may properly come before the meeting or any
adjournment thereof.
Only shareholders of record at the close of business on October 10, 1995 are
entitled to notice of and to vote at the meeting.
Dissenting shareholders who comply with the procedural requirements of the
Louisiana Business Corporation Law will be entitled to receive payment of the
fair cash value of their shares of PREMIER common stock if the Merger is
effected upon approval by less than 80% of PREMIER's total voting power.
Your vote is important regardless of the number of shares you own. Whether
or not you plan to attend the meeting, PLEASE MARK, DATE AND SIGN THE ENCLOSED
PROXY CARD AND RETURN IT PROMPTLY IN THE ENCLOSED STAMPED ENVELOPE.
BY ORDER OF THE BOARD OF DIRECTORS
Baton Rouge, Louisiana
October 13, 1995 /s/ James H. Napper, II
James H. Napper, II Secretary
<PAGE>
PROSPECTUS
21,861,840 SHARES
BANC ONE CORPORATION
COMMON STOCK
----------------
PREMIER BANCORP, INC.
PROXY STATEMENT
FOR SPECIAL MEETING OF SHAREHOLDERS NOVEMBER 17 , 1995
----------------
This Prospectus and Proxy Statement (the "Prospectus" or "Prospectus and
Proxy Statement") relates to a special meeting of shareholders (the "Special
Meeting") of Premier Bancorp, Inc. ("PREMIER"). At the Special Meeting,
shareholders will consider the proposed merger of PREMIER with and into
Premier Acquisition Corporation ("PAC"), a wholly owned subsidiary of BANC ONE
CORPORATION ("BANC ONE"). If the proposed merger (the "Merger") is
consummated, each outstanding share of PREMIER common stock, no par value ($5
stated value) per share ("PREMIER Common Stock"), together with any and all
Rights issued pursuant to the PREMIER Rights Plan, will be converted into
shares of BANC ONE Common Stock, no par value ($5 stated value) per share
("BANC ONE Common Stock"), at the rate of 0.617761 share of BANC ONE Common
Stock for each share of PREMIER Common Stock. The Merger is subject to the
approval of the holders of a majority of the outstanding shares of PREMIER
Common Stock entitled to vote thereon and present at the Special Meeting and
to the satisfaction of certain other conditions, including obtaining the
approval of the Board of Governors of the Federal Reserve System.
This Prospectus and Proxy Statement does not cover any resales of BANC ONE
Common Stock received by affiliates of PREMIER upon consummation of the Merger
and no person is authorized to make use of this Prospectus and Proxy Statement
in connection with any such resale.
The outstanding shares of BANC ONE Common Stock are, and the shares of BANC
ONE Common Stock offered hereby will be, listed and traded on the New York
Stock Exchange. The closing price of BANC ONE Common Stock on the New York
Stock Exchange on October 4, 1995 was $37.38.
----------------
THESE SECURITIES ARE NOT SAVINGS OR DEPOSIT ACCOUNTS OR OTHER OBLIGATIONS
OF ANY BANK OR NONBANK SUBSIDIARY OF BANC ONE CORPORATION AND ARE NOT
INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE BANK
INSURANCE FUND OR ANY OTHER GOVERNMENTAL AGENCY.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
----------------
A Special Meeting of Shareholders of PREMIER will be held at the Premier
Centre Building, 450 Laurel Street, Baton Rouge, Louisiana, on November 17,
1995 at 9:00 a.m. local time, to consider a proposal to approve the Merger
Agreement (as hereinafter defined).
----------------
THE DATE OF THIS PROSPECTUS AND PROXY STATEMENT IS OCTOBER 13, 1995.
<PAGE>
TABLE OF CONTENTS
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PAGE
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AVAILABLE INFORMATION..................................................... 4
INCORPORATION BY REFERENCE................................................ 4
SUMMARY................................................................... 6
Introduction........................................................... 6
Parties to the Merger.................................................. 6
Terms of the Merger Agreement and Exchange Rate........................ 6
Federal Income Tax Consequences........................................ 7
Vote Required.......................................................... 7
Rights of Dissenting Shareholders...................................... 7
Differences in Shareholder Rights...................................... 7
Regulatory Approval.................................................... 8
Conditions; Termination................................................ 8
Existing Agreements with BANC ONE...................................... 8
Opinion of the Financial Advisor....................................... 8
Accounting Treatment................................................... 9
Selected Financial Data................................................ 9
Comparative Per Share Data............................................. 10
THE SPECIAL MEETING....................................................... 10
Purpose of the Special Meeting......................................... 10
Record Date and Voting Rights.......................................... 10
Proxies................................................................ 11
MERGER.................................................................... 11
General................................................................ 11
Operations After the Merger............................................ 12
Background of the Merger; Existing Agreements with BANC ONE............ 12
Recommendation of PREMIER's Board and Reasons for the Merger........... 17
Opinion of the Financial Advisor....................................... 19
Conditions to the Merger; Termination.................................. 25
Federal Income Tax Consequences........................................ 28
Conversion of Shares and Exchange of Certificates...................... 29
Fractional Shares...................................................... 30
Interests of Certain Persons in the Merger............................. 30
Resales by Affiliates.................................................. 31
Accounting Treatment................................................... 32
COMPARATIVE RIGHTS OF SHAREHOLDERS........................................ 32
Description of BANC ONE Stock.......................................... 32
Comparison of BANC ONE Common Stock and PREMIER Common Stock........... 35
MISCELLANEOUS INFORMATION................................................. 40
Transfer and Exchange Agents........................................... 40
Experts................................................................ 40
Legal Matters.......................................................... 40
Sources of Information................................................. 40
Registration Statement................................................. 40
Other Matters.......................................................... 41
INFORMATION ABOUT BANC ONE CORPORATION.................................... 41
General................................................................ 41
Market Prices of and Dividends Paid on BANC ONE Common Stock........... 42
Certain Regulatory Matters............................................. 42
Incorporation of Certain Information About BANC ONE by Reference....... 47
</TABLE>
2
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PAGE
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INFORMATION ABOUT PREMIER BANCORP, INC.................................. 48
General.............................................................. 48
Market Prices of and Dividends Paid on PREMIER Common Stock.......... 48
Incorporation of Certain Information About PREMIER by Reference...... 49
VOTING AND MANAGEMENT INFORMATION....................................... 49
Voting............................................................... 49
Rights of Dissenting Shareholders.................................... 50
Management and Principal Shareholders of BANC ONE.................... 51
Management and Principal Shareholders of PREMIER..................... 51
APPENDICES..............................................................
A. Fairness Opinion of Merrill Lynch, Pierce, Fenner & Smith
Incorporated......................................................... A-1
B. Section 131 of the Louisiana Business Corporation Law............. B-1
</TABLE>
3
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NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS, OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND PROXY
STATEMENT IN CONNECTION WITH THE OFFER CONTAINED IN THIS PROSPECTUS AND PROXY
STATEMENT AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT
BE RELIED UPON AS HAVING BEEN AUTHORIZED BY BANC ONE OR PREMIER. NEITHER THE
DELIVERY OF THIS PROSPECTUS AND PROXY STATEMENT NOR ANY SALE MADE HEREUNDER
SHALL, UNDER ANY CIRCUMSTANCES, CREATE AN IMPLICATION THAT THE INFORMATION
HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE HEREOF OR THAT THERE
HAS BEEN NO CHANGE IN THE AFFAIRS OF BANC ONE OR PREMIER SINCE THE DATE
HEREOF. THIS PROSPECTUS AND PROXY STATEMENT IS NOT AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO PURCHASE ANY SECURITY, OR THE SOLICITATION OF A
PROXY, IN ANY JURISDICTION IN WHICH IT IS UNLAWFUL TO MAKE SUCH OFFER,
SOLICITATION OF AN OFFER OR PROXY SOLICITATION.
All information contained herein with respect to PREMIER has been provided
by PREMIER, and BANC ONE is relying upon the accuracy of that information. All
information contained herein with respect to BANC ONE has been provided by
BANC ONE, and PREMIER is relying upon the accuracy of that information.
AVAILABLE INFORMATION
Each of BANC ONE and PREMIER is subject to the informational requirements of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements and other information
with the Securities and Exchange Commission (the "Commission"). Such reports,
proxy statements and other information can be inspected and copied at the
Public Reference Room of the Commission at 450 Fifth Street, N.W., Washington,
D.C. 20549, and the Commission's Regional Offices at 500 West Madison Street,
Suite 1400, Chicago, Illinois 60661 and Seven World Trade Center (13th Floor),
New York, New York 10048. Copies of such material can be obtained from the
Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549 at prescribed rates. In addition, such reports, proxy
statements and other information concerning BANC ONE can be inspected at the
offices of the New York Stock Exchange, 20 Broad Street, New York, New York.
PREMIER Common Stock is included for quotation on The Nasdaq Stock Market and
such reports, proxy statement and other information concerning PREMIER can be
inspected at the offices of the National Association of Securities Dealers,
Inc., 1735 K Street, N.W., Washington, D.C. 20006.
BANC ONE has filed with the Commission a Registration Statement on Form S-4
(together with any amendments thereto, the "Registration Statement") under the
Securities Act of 1933, as amended (the "Securities Act"), with respect to the
BANC ONE Common Stock to be issued pursuant to the Merger. This Prospectus and
Proxy Statement does not contain all information set forth in the Registration
Statement and exhibits thereto. Such additional information may be inspected
and copied as set forth above. Statements contained in this Prospectus and
Proxy Statement or in any document incorporated into this Prospectus and Proxy
Statement by reference as to the contents of any contract or other document
referred to herein or therein are not necessarily complete, and in each
instance reference is made to the copy of such contract or document filed as
an exhibit to the Registration Statement or such other document, each such
statement being qualified in all respects by such reference.
INCORPORATION BY REFERENCE
THIS PROSPECTUS AND PROXY STATEMENT INCORPORATES DOCUMENTS BY REFERENCE THAT
ARE NOT PRESENTED HEREIN OR DELIVERED HEREWITH. COPIES OF ANY SUCH DOCUMENTS,
OTHER THAN EXHIBITS TO SUCH DOCUMENTS THAT ARE NOT SPECIFICALLY INCORPORATED
BY REFERENCE THEREIN, ARE AVAILABLE WITHOUT CHARGE TO ANY PERSON, INCLUDING
ANY PREMIER SHAREHOLDER, TO WHOM THIS PROSPECTUS AND PROXY STATEMENT IS
DELIVERED UPON ORAL OR WRITTEN REQUEST, IN THE CASE OF DOCUMENTS RELATING TO
BANC ONE, TO BANC ONE CORPORATION, 100 EAST BROAD STREET, COLUMBUS, OHIO
43271-0251, ATTENTION: JACQUELINE R. SPAK, TELEPHONE NUMBER 614/248-1280, AND,
IN THE CASE OF DOCUMENTS RELATING TO PREMIER, TO R. NEIL WILLIAMS, CHIEF
FINANCIAL OFFICER, PREMIER BANCORP, INC., 451 FLORIDA STREET, BATON ROUGE,
LOUISIANA 70801, TELEPHONE NUMBER 504/332-7277. IN ORDER TO ENSURE TIMELY
DELIVERY OF THE DOCUMENTS, ANY REQUEST SHOULD BE MADE BY NOVEMBER 10, 1995.
4
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The following documents filed by BANC ONE with the Commission under the
Exchange Act are incorporated herein by reference:
1. Annual Report on Form 10-K for the fiscal year ended December 31, 1994
(as amended by Form 10-K/A filed April 4, 1995 and Form 10-K/A filed
June 29, 1995).
2. Quarterly Reports on Form 10-Q for the quarters ended March 31, 1995 and
June 30, 1995.
3. Current Reports on Form 8-K dated July 19, 1995 and July 24, 1995.
4. The description of BANC ONE Common Stock set forth in BANC ONE's
Registration Statement on Form 8-B dated May 1, 1989, including any
amendment or report filed for the purpose of updating such description.
The following documents filed by PREMIER with the Commission under the
Exchange Act are incorporated herein by reference:
1. Annual Report on Form 10-K for the fiscal year ended December 31, 1994.
2. Quarterly Reports on Form 10-Q for the quarters ended March 31, 1995 and
June 30, 1995.
3. Current Reports on Form 8-K dated January 11, 1995, April 12, 1995, May
2, 1995, July 12, 1995 and July 19, 1995.
4. The description of PREMIER Common Stock set forth in PREMIER's Current
Report on Form 8-K dated February 22, 1991, including any amendment or
report filed for the purpose of updating such description.
All documents filed by BANC ONE or PREMIER pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act after the date of this Prospectus and prior to
the Special Meeting of Shareholders of PREMIER shall be deemed to be
incorporated by reference in this Prospectus and Proxy Statement and to be a
part hereof from the respective dates of filing of such documents. Any
statement contained in a document incorporated or deemed to be incorporated by
reference herein shall be deemed to be modified or superseded for purposes of
this Prospectus and Proxy Statement to the extent that such statement is
modified or superseded by a statement contained herein or in any other
subsequently filed document which also is or is deemed to be incorporated by
reference herein. Any such statement so modified or superseded shall not be
deemed, except as so modified or superseded, to constitute a part of this
Prospectus and Proxy Statement.
5
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PROSPECTUS AND PROXY STATEMENT
PREMIER BANCORP, INC.
BATON ROUGE, LOUISIANA
------------
SPECIAL MEETING OF SHAREHOLDERS
SUMMARY
The following summary is not intended to be complete and is qualified in its
entirety by reference to the more detailed information contained elsewhere in
this Prospectus and Proxy Statement and the documents incorporated by
reference herein.
INTRODUCTION
This Prospectus and Proxy Statement is being furnished in connection with
the solicitation of proxies by the Board of Directors of Premier Bancorp, Inc.
("PREMIER"), a Louisiana corporation and registered bank holding company
headquartered in Baton Rouge, Louisiana, to be voted at a Special Meeting of
Shareholders of PREMIER to be held on November 17, 1995 at 9:00 a.m. local
time and at any and all adjournments thereof (the "Special Meeting") for the
purpose of approving an Agreement and Plan of Merger dated as of July 19, 1995
and amended as of September 7, 1995 (as amended, the "Merger Agreement")
between PREMIER, BANC ONE CORPORATION ("BANC ONE"), a registered multi-bank
holding company headquartered in Columbus, Ohio, and Premier Acquisition
Corporation ("PAC"), a wholly owned subsidiary of BANC ONE.
This Prospectus and Proxy Statement and the proxy card are being mailed to
the shareholders of PREMIER for the first time on or about October 13, 1995.
PARTIES TO THE MERGER
PREMIER is the bank holding company of Premier Bank, National Association
("Premier Bank"), a national banking association offering banking and trust
services through more than 150 branches located throughout Louisiana. Premier
Bank has branch offices in seven of the eight major metropolitan areas of
Louisiana. PREMIER also has a wholly owned, nonbank subsidiary that provides
discount brokerage services. At June 30, 1995, PREMIER had consolidated total
assets of $5.5 billion, consolidated total deposits of $4.3 billion and
consolidated total stockholders' equity of $477 million. See "INFORMATION
ABOUT PREMIER BANCORP, INC." PREMIER's principal executive offices are at 451
Florida Street, Baton Rouge, Louisiana 70801, and its telephone number is
504/332-7277.
BANC ONE is a multi-bank holding company incorporated under the laws of the
State of Ohio that, at June 30, 1995, had a total of 65 bank subsidiaries in
Arizona, Colorado, Illinois, Indiana, Kentucky, Ohio, Oklahoma, Texas, Utah,
West Virginia and Wisconsin. At June 30, 1995, BANC ONE had consolidated total
assets of $86.8 billion, consolidated total deposits of $65.6 billion and
consolidated total stockholders' equity of $7.8 billion. PAC is a wholly owned
subsidiary of BANC ONE formed under the laws of the State of Ohio. See
"INFORMATION ABOUT BANC ONE CORPORATION." The principal office of BANC ONE is
located at 100 East Broad Street, Columbus, Ohio 43271 and its telephone
number is 614/248-5944.
TERMS OF THE MERGER AGREEMENT AND EXCHANGE RATE
Upon the Merger becoming effective, each of the outstanding shares of
PREMIER Common Stock (together with any and all Rights (as defined below))
shall be converted into 0.617761 share of BANC ONE Common Stock (the "Exchange
Rate"). Upon the consummation of the Merger, PREMIER will be merged with and
into
6
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PAC and the separate corporate existence of PREMIER will cease. PAC, as the
surviving corporation in the Merger and a wholly owned subsidiary of BANC ONE,
will continue operations under the name "Banc One Louisiana Corporation." It
is expected that PREMIER's current officers, directors and employees will
serve as the officers, directors and employees of the surviving corporation
following the Merger.
As used in this Prospectus and Proxy Statement, "Rights" means any and all
PREMIER Common Stock purchase rights and related interests and rights
associated with each share of PREMIER Common Stock arising from, related to
and/or issued pursuant to the Rights Agreement dated January 18, 1989 (the
"PREMIER Rights Plan") between PREMIER and Premier Bank.
FEDERAL INCOME TAX CONSEQUENCES
Pursuant to the terms of the Merger Agreement, PREMIER and BANC ONE have
received the opinion of Coopers & Lybrand L.L.P. to the effect that no gain or
loss will be recognized by PREMIER's shareholders for Federal income tax
purposes as a result of the exchange of their PREMIER Common Stock for BANC
ONE Common Stock in the Merger, disregarding for purposes of the opinion any
cash received pursuant to the Merger in connection with fractional share
interests or the assertion of dissenters' rights. The tax consequences of the
proposed transaction to shareholders of PREMIER are summarized under "MERGER--
Federal Income Tax Consequences."
VOTE REQUIRED
Holders of not less than a majority of the outstanding shares of PREMIER
Common Stock entitled to vote thereon and present at the Special Meeting must
vote in favor of the approval of the Merger Agreement in order for the
transaction to be completed. The directors and executive officers of PREMIER,
together with their affiliates, are entitled to vote approximately 7.5% of the
outstanding shares of PREMIER Common Stock. PREMIER believes that all of the
directors' and executive officers' and their respective affiliates' shares
will be voted in favor of the Merger. It is not necessary for the shareholders
of BANC ONE to approve the Merger Agreement. However, BANC ONE, as the sole
shareholder of PAC, has approved or will approve the Merger Agreement. For
information concerning voting by shareholders of PREMIER on the proposed
Merger, see "MERGER--General" and "VOTING AND MANAGEMENT INFORMATION--Voting."
RIGHTS OF DISSENTING SHAREHOLDERS
Shareholders who both object in writing to, and vote against, the Merger
Agreement will be entitled upon compliance with Section 131 of the Louisiana
Business Corporation Law to be paid the fair cash value of their shares as of
the day before the Special Meeting, but only if the Merger is consummated and
the Merger Agreement was approved by the holders of less than 80% of the
outstanding shares of PREMIER Common Stock. Such fair cash value would be
payable only after the Merger is consummated, and would be paid without
interest. A shareholder who perfects his or her dissenters' rights, upon
filing a demand for the value of his or her shares, will, under Louisiana law,
no longer have any rights as a shareholder, including the right to pursue
state law claims. See "VOTING AND MANAGEMENT INFORMATION--Rights of Dissenting
Shareholders."
DIFFERENCES IN SHAREHOLDER RIGHTS
Although there are some differences between the rights of PREMIER
shareholders and BANC ONE shareholders, such rights are similar in many
material respects. Both Ohio law and BANC ONE's Articles contain "control
share acquisition" provisions which mandate certain procedures and shareholder
consents to approve certain share acquisitions. Louisiana law contains a
control share acquisition statute similar to that under Ohio law which is
substantially replicated in BANC ONE's Articles. BANC ONE's Articles contain
supermajority vote and so-called "fair price" provisions which mandate certain
procedures and approvals for a business combination. Louisiana law and
PREMIER's Articles contain similar provisions. In addition, Ohio law
7
<PAGE>
contains provisions prohibiting certain business combinations between
corporations and "Interested Stockholders." The effect of the supermajority
and fair price provisions contained in BANC ONE's and PREMIER's Articles may
be to discourage certain potential business combinations that some
shareholders may believe to be in their best interests and to make more
difficult management changes that might occur if the potential business
combination were successful. See "COMPARATIVE RIGHTS OF SHAREHOLDERS."
REGULATORY APPROVAL
In order for the proposed transaction to be completed, approval of BANC
ONE's acquisition of PREMIER must be obtained from the Board of Governors of
the Federal Reserve System (the "Federal Reserve"). A regulatory application
seeking such approval was filed with the Federal Reserve in September 1995
and, concurrently therewith, provided for informational purposes to the
Louisiana Commissioner of Financial Institutions (the "Louisiana
Commissioner"). It is anticipated, although no assurance can be given, that
the Federal Reserve will grant its approval during the fourth quarter of 1995.
CONDITIONS; TERMINATION
Consummation of the Merger is subject to satisfaction or waiver of various
conditions, including compliance by each party with its respective covenants
and confirmation by each party of its respective representations and
warranties, the absence of any material adverse change in the financial
condition or business of PREMIER or BANC ONE, the fulfillment of certain
earnings tests and other matters. The Merger Agreement provides that either
party may abandon the Merger if it is not consummated on or before July 1,
1996. See "MERGER--Conditions to the Merger" for a more complete discussion of
the conditions to the Merger.
EXISTING AGREEMENTS WITH BANC ONE
On March 26, 1992, PREMIER issued a $65 million capital note to BANC ONE and
entered into an acquisition agreement with BANC ONE pursuant to which BANC ONE
has an option to acquire PREMIER by merger exercisable upon notice of exercise
given as of the end of any calendar quarter beginning with the second quarter
of 1995 and ending with the first quarter of 1997. If BANC ONE exercises its
option, the price to be paid to the holders of PREMIER Common Stock will be
based on the book value of a share of PREMIER Common Stock at the time of
exercise. Generally, the acquisition agreement provides for a purchase price
of 125% of the PREMIER Common Stock book value as of the quarter-end preceding
the date of notice of exercise; however, the price is subject to adjustment
based on the level of PREMIER's allowance for possible credit losses and
certain other factors at the time of the exercise of the option. PREMIER may
terminate the option prior to notice of exercise if it is acquired by a third
party and, through its warrants issued to BANC ONE in connection with the
issuance of the capital note, causes BANC ONE to be paid approximately 30% of
PREMIER's common shareholders' equity or, during a limited period after notice
of exercise, by paying BANC ONE an amount equal to 30% of PREMIER'S common
shareholders' equity. The option is exercisable at BANC ONE's discretion. See
"MERGER--Background of the Merger; Existing Agreements with BANC ONE."
If for any reason the Merger Agreement is terminated or the Merger does not,
pursuant to the Merger Agreement, become effective, the acquisition agreement,
the capital note, the warrant and the agreements relating thereto will remain
in full force and effect without modification or amendment and the parties
thereto will have the rights and obligations set forth therein.
OPINION OF THE FINANCIAL ADVISOR
PREMIER engaged Merrill Lynch, Pierce, Fenner & Smith Incorporated ("Merrill
Lynch") in 1990 as its financial advisor to assist in a review of PREMIER's
strategic plans in connection with its efforts to obtain capital, which
efforts resulted in the existing agreements with BANC ONE described above. In
1994, PREMIER again engaged Merrill Lynch as its financial advisor in
analyzing alternatives available to PREMIER under the existing agreements with
BANC ONE. Merrill Lynch has delivered its written opinion to PREMIER's Board
of
8
<PAGE>
Directors that the Exchange Rate is fair to PREMIER's shareholders from a
financial point of view. See "MERGER--Opinion of the Financial Advisor" for a
more complete description of Merrill Lynch's opinion. The full text of the
opinion is included herein as Appendix A, and shareholders are urged to read
the opinion in its entirety.
ACCOUNTING TREATMENT
BANC ONE expects to account for the acquisition of PREMIER as a purchase
under generally accepted accounting principles. See "MERGER--Accounting
Treatment."
SELECTED FINANCIAL DATA
The following table presents on a historical basis selected unaudited
consolidated financial data for BANC ONE and PREMIER. The financial data is
based on the consolidated financial statements of BANC ONE and PREMIER,
respectively, incorporated herein by reference.
SELECTED FINANCIAL DATA
(THOUSANDS, EXCEPT PER SHARE)
(UNAUDITED)
<TABLE>
<CAPTION>
SIX MONTHS
ENDED
JUNE 30, YEAR ENDED DECEMBER 31,
----------- -----------------------------------------------------------
1995 1994 1993 1992 1991 1990
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Total interest income
and other income:
BANC ONE............... $ 4,395,231 $ 7,857,108 $ 7,610,670 $ 7,740,657 $ 7,223,889 $ 6,526,868
PREMIER................ 238,386 417,411 369,990 389,833 411,547 425,983
Income (loss) from
continuing operations:
BANC ONE............... $ 610,000 $ 1,005,109 $ 1,172,103 $ 922,227 $ 703,386 $ 568,856
PREMIER................ 33,874 69,472 71,811 44,809 18,177 9,283
Income (loss) from
continuing operations
per common share:
BANC ONE............... $1.52 $2.42 $2.88 $2.27 $1.82 $1.56
PREMIER................ 0.98 2.08 2.19 1.34 0.56 0.29
Historical dividends
declared per common
share:
BANC ONE............... $0.68 $1.24 $1.07 $0.89 $0.76 $0.69
PREMIER................ (1) (1) (1) (1) (1) (1)
Total assets (end of
period):
BANC ONE............... $86,783,317 $88,922,586 $84,834,656 $81,304,864 $78,178,604 $60,323,593
PREMIER................ 5,494,245 5,419,792 4,649,161 4,317,043 4,214,800 4,274,041
Long-term borrowings
(end of period):
BANC ONE............... $ 2,087,954 $ 1,866,448 $ 1,805,272 $ 1,396,797 $ 983,077 $ 847,574
PREMIER................ 294,065 310,674 93,514 69,625 45,602 46,870
Total stockholders'
equity (end of period):
BANC ONE............... $ 7,839,071 $ 7,564,860 $ 7,433,170 $ 6,594,813 $ 5,879,957 $ 4,789,995
PREMIER................ 477,220 424,201 361,593 272,392 195,755 174,213
</TABLE>
- --------
(1) PREMIER did not declare any dividends on PREMIER Common Stock during this
period.
9
<PAGE>
COMPARATIVE PER SHARE DATA
The following table sets forth historical per common share income from
continuing operations, dividends, book value and market value of: (i) BANC
ONE; (ii) PREMIER; and (iii) pro forma equivalent per share data of PREMIER,
calculated by multiplying the historical per share data of BANC ONE by the
Exchange Rate.
<TABLE>
<CAPTION>
PRO FORMA
BANC ONE PREMIER EQUIVALENT
-------- ------- ----------
<S> <C> <C> <C>
Income from continuing operations per common
share:
Year ended December 31, 1994................... $2.42 $2.08 $1.49
Six months ended June 30, 1995................. $1.52 $0.98 $0.94
Dividends declared per common share:
Year ended December 31, 1994................... 1.24 (1) 0.77
Six months ended June 30, 1995................. 0.68 (1) 0.42
Book value per common share as of:
December 31, 1994.............................. 18.43 12.55 11.39
June 30, 1995.................................. 19.35 14.12 11.95
Market value per common share as of July 18,
1995 (2)........................................ 32.63(3) 18.50(4) 20.15
Market value per common share as of October 4,
1995 (5)........................................ 37.38(3) 22.38(4) 23.09
</TABLE>
- --------
(1) PREMIER did not declare any dividends on PREMIER Common Stock in any
period presented.
(2) The trading day immediately preceding public announcement of the proposed
merger.
(3) Based on the closing price of BANC ONE Common Stock as reported on the New
York Stock Exchange.
(4) Based on the closing price of PREMIER Common Stock as reported on The
Nasdaq Stock Market.
(5) A recent business day preceding the date of this Prospectus and Proxy
Statement.
THE SPECIAL MEETING
This Prospectus and Proxy Statement is being furnished to the shareholders
of PREMIER in connection with the solicitation of proxies by the PREMIER Board
of Directors to be voted at the Special Meeting. The Special Meeting will be
held on November 17, 1995, at 9:00 a.m. local time in the auditorium on the
8th floor of the Premier Centre Building, 450 Laurel Street, Baton Rouge,
Louisiana.
PURPOSE OF THE SPECIAL MEETING
At the Special Meeting, the holders of PREMIER Common Stock will vote on a
proposal to approve the Merger Agreement.
RECORD DATE AND VOTING RIGHTS
The PREMIER Board has fixed the close of business on October 10, 1995 as the
Record Date for determination of shareholders entitled to notice of and to
vote at the Special Meeting. As of the Record Date, 34,911,012 shares of
PREMIER Common Stock were outstanding, each of which entitles its holder to
one vote on each matter submitted to the vote of shareholders at the Special
Meeting. The presence in person or by proxy of the holders of a majority of
the shares of PREMIER Common Stock outstanding is required to constitute a
quorum for the Special Meeting. Approval of the Merger Agreement requires the
affirmative vote of not less than a majority of the outstanding shares of
PREMIER Common Stock entitled to vote thereon and present at the Special
Meeting.
10
<PAGE>
Votes, whether in person or by proxy, will be counted and tabulated by
inspectors appointed by PREMIER. The inspectors will treat shares of PREMIER
Common Stock represented by a properly executed and returned proxy as present
at the Special Meeting for purposes of determining a quorum. An abstention
will have the same effect as a vote against the proposal to approve the Merger
Agreement, and a broker non-vote will have no effect on the outcome of the
vote on the proposal.
PROXIES
The form of proxy for use at the Special Meeting accompanies this Prospectus
and Proxy Statement. A shareholder may use a proxy whether or not he or she
intends to attend the Special Meeting in person. The proxy may be revoked in
writing by the person giving it at any time before it is exercised by notice
to the Secretary of PREMIER, by executing and submitting a later dated proxy
or by attending and voting in person at the Special Meeting. All proxies
validly submitted and not revoked will be voted in the manner specified
therein. IF NO SPECIFICATION IS MADE, THE PROXIES WILL BE VOTED IN FAVOR OF
APPROVAL OF THE MERGER AGREEMENT. The PREMIER Board is not aware of any other
matters that may be presented for action at the Special Meeting, but if other
matters do properly come before the meeting it is intended that the shares
represented by the accompanying proxy will be voted by the persons named in
the proxy in accordance with their best judgment.
Solicitation of proxies will be made in person, by mail or by telephone or
telegraph by present and former directors, officers and employees of PREMIER
for which no additional compensation will be paid. PREMIER has also retained
Corporate Investor Communications, Inc. to assist in the solicitation of
proxies, for a fee of approximately $5,000 plus reasonable out-of-pocket
expenses. PREMIER will bear the cost of solicitation of proxies from its
shareholders and may reimburse brokers and others for their expenses in
forwarding solicitation material to beneficial owners of its voting stock.
MERGER
The information in this Prospectus and Proxy Statement concerning the terms
of the Merger is a summary only and is qualified in its entirety by reference
to the Merger Agreement, which agreement is filed as an exhibit to the
Registration Statement and incorporated by reference herein.
GENERAL
The Merger Agreement provides for the merger of PREMIER with and into PAC.
Upon the effectiveness of the Merger (the "Effective Time") each of the
outstanding shares of PREMIER Common Stock (together with any and all Rights
issued pursuant to the PREMIER Rights Plan) will be converted into 0.617761
share of BANC ONE Common Stock (subject to anti-dilution adjustments in
certain circumstances such as stock dividends or stock splits), which shares
of BANC ONE Common Stock will be issued as a result of the Merger. An increase
or decrease in the market price of BANC ONE Common Stock will not affect the
Exchange Rate or the number of shares of BANC ONE Common Stock issuable in the
Merger; therefore, the value of the consideration to be received by PREMIER's
shareholders in the Merger will increase if the market price of BANC ONE
Common Stock increases or decrease if the market price of BANC ONE Common
Stock decreases.
The Merger Agreement permits PREMIER to declare and pay quarterly dividends
at the rate of $0.25 per share beginning with the third calendar quarter of
1995 and until but not including the quarter in which the holders of PREMIER
Common Stock become entitled to receive regular quarterly dividends on the
shares of BANC ONE Common Stock into which the shares of PREMIER Common Stock
will be converted by virtue of the Merger.
Holders of not less than a majority of the outstanding shares of PREMIER
Common Stock entitled to vote thereon and present at the Special Meeting must
vote in favor of the approval of the Merger Agreement in order for the
transaction to be completed. See "VOTING AND MANAGEMENT INFORMATION--Voting."
The
11
<PAGE>
closing of the Merger will (unless the parties agree otherwise) take place on
the last business day of a month which first occurs on or after the later of
(i) the expiration of any required waiting period following the approval of
the consummation of the Merger by the Federal Reserve, (ii) the date PREMIER's
shareholders approve the Merger or (iii) the business day following the
satisfaction or waiver of all conditions to the Merger (the "Closing Date").
The Merger will become effective as soon as possible after the Closing Date in
accordance with the Ohio Business Corporations Law ("Ohio Law") and the
Louisiana Business Corporation Law ("Louisiana Law") on the later to occur of
(x) the filing with the Secretary of State of the State of Ohio of a
Certificate of Merger and (y) the filing with the Secretary of State of the
State of Louisiana of a Certificate of Merger.
The Boards of Directors of BANC ONE, PAC and PREMIER have approved the
Merger Agreement. BANC ONE, as the sole shareholder of PAC, has approved or
will approve the Merger Agreement. Approval of the Merger Agreement by the
shareholders of BANC ONE is not required for consummation of the Merger.
While the Merger Agreement is in effect, it supersedes PREMIER's existing
agreements with BANC ONE, described below under the heading "MERGER--
Background of the Merger; Existing Agreements with BANC ONE," other than the
Capital Note Agreement and the Capital Note. If for any reason the Merger
Agreement is terminated or the Merger does not become effective, PREMIER's
existing agreements with BANC ONE will remain in full force and effect without
modification or amendment and the parties thereto will have the rights and
obligations set forth therein. If the Merger becomes effective, PREMIER's
existing agreements with BANC ONE will become null and void and have no force
and effect; provided, however, that the Capital Note Agreement and the Capital
Note will remain in full force and effect.
OPERATIONS AFTER THE MERGER
Upon the consummation of the Merger, PREMIER will be merged with and into
PAC and the separate corporate existence of PREMIER will cease. PAC, as the
surviving corporation in the Merger and a wholly owned subsidiary of BANC ONE,
will continue operations under the name "Banc One Louisiana Corporation." It
is expected that PREMIER's current officers, directors and employees will
serve as the officers, directors and employees of the surviving corporation
following the Merger.
BACKGROUND OF THE MERGER; EXISTING AGREEMENTS WITH BANC ONE
PREMIER was formed in January 1985 upon the consolidation of three one-bank
holding companies located in Baton Rouge, Shreveport and Monroe, Louisiana.
During 1985 and 1986, PREMIER acquired five additional banks located in New
Iberia, Raceland, Lafayette, Lake Charles and Houma, Louisiana, thus
establishing a market presence in all major metropolitan areas in Louisiana
other than New Orleans and Alexandria. In the mid-1980's, the downturn in the
oil-dominated Louisiana economy accelerated, with oil prices dropping from $28
a barrel in December 1985 to $10 in February 1986. Largely as a result,
PREMIER sustained net losses in 1986 through 1989, causing a decline in common
shareholders' equity from a high of $320 million at the end of 1986 to a low
of $146 million at the end of 1989.
By early 1989, PREMIER was faced with weak capital, excessive nonperforming
assets, uncertain earnings prospects and scheduled debt service payments in
excess of funds expected to be available therefor. In response, PREMIER
developed and began to implement an asset restructuring and recapitalization
plan. When it was determined in early 1990 that the plan could not be
consummated, PREMIER retained Merrill Lynch to act as its financial advisor to
assist it in a review of its strategic options. In addition, to coordinate and
supervise the activities of management and the financial advisor, PREMIER's
Board appointed a Special Projects Committee composed of John C. Blackman, IV
(chairman), Frank W. Harrison, Jr., Eugene H. Owen and Bert S. Turner (who
retired from PREMIER's Board in 1992), all outside directors who together
beneficially owned at the time 2.5% of PREMIER's Common Stock.
12
<PAGE>
Throughout 1990, PREMIER's management, the Executive Committee of PREMIER's
Board, the Special Projects Committee and Merrill Lynch worked to identify and
pursue alternatives reasonably available to address the Company's capital and
liquidity concerns. These efforts resulted in PREMIER, BANC ONE and the
holders of PREMIER's senior notes consummating in March 1992 several related
transactions that had been approved by PREMIER's shareholders in September
1991. On March 26, 1992, PREMIER issued a $65 million capital note (the
"Capital Note") to BANC ONE pursuant to the terms of an Amended and Restated
Capital Note Agreement dated March 26, 1992 (the "Capital Note Agreement").
From the proceeds of the Capital Note, PREMIER contributed $25 million to the
equity capital of Premier Bank. PREMIER also delivered a cash payment and
251,900 shares of its 10.75% Cumulative Convertible Preferred Stock, Series A,
in exchange for the senior notes. In addition, PREMIER and BANC ONE entered
into an Amended and Restated Agreement and Plan of Acquisition dated March 26,
1992 (as amended, the "1992 Agreement"), pursuant to which BANC ONE obtained
an option to acquire PREMIER by means of a merger of PREMIER into a subsidiary
of BANC ONE (the "Option"). In connection with the issuance of the Capital
Note, PREMIER issued a warrant to BANC ONE (the "Warrant") to purchase shares
of PREMIER Common Stock pursuant to a Warrant Agreement dated March 26, 1992
(the "Warrant Agreement"). The Warrant is exercisable only if PREMIER (i)
consummates a business combination, other than with BANC ONE, in a transaction
in which PREMIER is not the surviving entity; or (ii) consummates a sale of
substantially all of its assets to any entity that is not an affiliate of
PREMIER, BANC ONE or any affiliate of BANC ONE. If the Warrant becomes
exercisable, PREMIER has the right to purchase the Warrant, and BANC ONE has
the right to require the Warrant to be purchased, for cash equal to
approximately 30% of PREMIER's common shareholders' equity. These transactions
are described in greater detail in Notes 1, 10, 11 and 12 of the Notes to
PREMIER's Consolidated Financial Statements included in PREMIER's Form 10-K
for the year ended December 31, 1994 and under the caption "Description of
Option to Acquire Premier Bancorp, Inc." included in the Form 10-K.
BANC ONE could exercise the Option at its discretion by giving notice of
exercise to PREMIER at certain times from July 1, 1995 through a date shortly
after March 31, 1997. Generally, the Option allowed BANC ONE to purchase
PREMIER for a purchase price (the "Formula Price") of 125% of PREMIER's book
value as of the quarter ended immediately prior to the time of exercise (the
"Calculation Date"), subject to certain adjustments. The Formula Price was
payable in the form of BANC ONE Common Stock at an exchange ratio that would
be fixed at the time the Option was exercised. More specifically, the exchange
ratio would be equal to the Formula Price divided by the average of the
closing prices per share of BANC ONE Common Stock over the 20 trading days
immediately preceding the Calculation Date. If, however, BANC ONE's price-
earnings ratio at the time the Option was exercised was equal to or less than
11, BANC ONE was entitled to pay up to 49.9% of the purchase price in cash.
Prior to BANC ONE's exercise of the Option, PREMIER could only terminate the
Option by finding a third party willing to acquire PREMIER. Such a transaction
would entitle BANC ONE, pursuant to the Warrants, to receive from PREMIER, or
from the third party on behalf of PREMIER, a cash payment equal to
approximately 30% of PREMIER's common shareholders' equity (the "Acquisition
Payment"). PREMIER could also terminate the Option by waiting until BANC ONE
exercised it and then paying to BANC ONE in cash an amount equal to 30% of
PREMIER's common shareholders' equity as of the Calculation Date (the
"Cancellation Payment"). To effect such a cancellation, PREMIER was required
to give notice (the "Cancellation Notice") to BANC ONE no later than 15 days
after BANC ONE's exercise of the Option, and make the Cancellation Payment no
later than 90 days thereafter.
In approving these agreements, PREMIER's Board concluded that there was no
more favorable alternative course of action available to address PREMIER's
capital and liquidity problems. The Board believed that the capital note and
preferred stock, by increasing PREMIER's capital and reducing its current cash
payment obligations, provided an opportunity for PREMIER to continue to pursue
its plans to reduce nonperforming assets and increase earnings and assets. The
Option, by deferring the possible acquisition of PREMIER by BANC ONE, provided
a potential means for PREMIER's shareholders to benefit from any increased
value that might result.
13
<PAGE>
Premier's financial condition improved rapidly thereafter, and in 1992 and
1993 PREMIER achieved record high levels of net income. By the end of 1993,
Premier's common shareholders' equity had grown to $331 million, from $155
million at the end of 1990. Over the same period market capitalization had
risen from $62 million to $480 million. In 1993, PREMIER redeemed for $25
million in cash, plus accrued interest, all of the preferred stock issued in
1992 to the former holders of its senior notes. Also in 1993, BANC ONE and
PREMIER amended the capital note to remove the floor and ceiling on the
interest rate, which had the effect of reducing interest payments otherwise
payable by PREMIER at the time. If a third party acquired PREMIER, however,
PREMIER would be obligated to pay to BANC ONE any amounts BANC ONE would have
been paid in the absence of the amendment (approximately $2.6 million as of
June 30, 1995).
By early 1994, 18 months prior to the time BANC ONE could first exercise the
Option, PREMIER's Board became increasingly concerned that the Formula Price
would not provide PREMIER's shareholders with adequate value for their shares
in light of PREMIER's improved financial performance and recent significant
increases in the prevailing acquisition premiums being paid for other banking
institutions, and concluded that PREMIER should begin to search actively for
alternatives. On February 8, 1994, the Special Projects Committee held a
meeting in New York City, attended by all of the members of the Committee, G.
Lee Griffin, R. Neil Williams and Nancy M. Richmond (PREMIER's Chairman and
Chief Executive Officer, Chief Financial Officer and Chief Accounting Officer,
respectively), PREMIER's special counsel, representatives of Merrill Lynch,
and Merrill Lynch's counsel, to discuss alternatives available to PREMIER
under the existing agreements with BANC ONE. In March 1994, PREMIER engaged
Merrill Lynch to act as its financial advisor in this regard.
Throughout 1994, PREMIER's management, the Special Projects Committee and
PREMIER's Board, assisted by Merrill Lynch and PREMIER's special counsel and
independent accountants, identified and analyzed potential strategies
available to PREMIER which might provide its shareholders with more value than
would be provided if BANC ONE exercised the Option and paid the Formula Price.
During 1994, the Special Projects Committee met to consider these issues 11
times. Members of PREMIER's management were present at each meeting, Merrill
Lynch attended nine meetings in person or by conference telephone, Merrill
Lynch's counsel attended two meetings, and PREMIER's special counsel attended
five meetings. During 1994, PREMIER's Board met four times, and PREMIER's
alternatives in light of the existing agreements with BANC ONE were discussed
each time. Of these four meetings, members of PREMIER's management were
present at each meeting, PREMIER's special counsel and Merrill Lynch attended
three meetings and Merrill Lynch's counsel attended one meeting. In addition,
Premier Bank's Board met 12 times and received updates on management's and the
Special Projects Committee's progress at ten of those meetings. Eight of the
ten members of Premier Bank's Board constitute the Executive Committee of
PREMIER's Board. In November 1994, John B. McCoy and William P. Boardman (BANC
ONE's Chairman and Chief Executive Officer and Senior Executive Vice
President, respectively), addressed Premier Bank's Board regarding BANC ONE's
financial performance and its relationship with PREMIER.
Throughout much of 1994, PREMIER's strategy with respect to its relationship
with BANC ONE focused mainly on attempting to negotiate a merger with BANC ONE
prior to the date the Option became exercisable at a price higher than the
Formula Price. To this end, Mr. Griffin had several telephone conversations
and meetings with Mr. Boardman. In addition, in April 1994, Messrs. Griffin
and Williams, along with representatives from Merrill Lynch, met with Mr.
Boardman in Atlanta, and in May 1994, Messrs. Griffin and Williams met with
Mr. Boardman in Columbus. Ultimately, however, the parties were not able to
agree upon terms acceptable to both.
In the fall of 1994, Merrill Lynch, authorized by the Special Projects
Committee, contacted several bank holding companies that Merrill Lynch and
PREMIER believed might have the capacity and interest to acquire PREMIER;
however, none expressed an interest in pursuing discussions with PREMIER.
Among other strategies considered by PREMIER were pursuing means to increase
PREMIER's book value, and therefore increase the Formula Price or,
alternatively, pursuing means to decrease PREMIER's book value and decrease
the size of the Acquisition Payment or Cancellation Payment if PREMIER
ultimately terminated the Option. PREMIER also considered its right under the
1992 Agreement to pay dividends after BANC ONE's exercise of the Option
14
<PAGE>
without affecting the Formula Price, and the amount of any such dividends that
it might be able to pay under the 1992 Agreement.
PREMIER also considered during 1994 whether it would have the financial
capacity to make the Acquisition Payment or the Cancellation Payment. PREMIER
focused particularly on whether the Acquisition Payment or the Cancellation
Payment would be deductible by PREMIER for federal income tax purposes and
whether such a payment could be reflected net of its associated tax benefit in
PREMIER's audited financial statements. In December 1994, PREMIER's special
counsel informed PREMIER that, barring unforeseen changes in the law or facts,
PREMIER's special counsel was prepared to deliver a legal opinion that, if the
matter were litigated, a court should hold that the Cancellation Payment was
deductible by PREMIER for federal income tax purposes, provided that, at the
time PREMIER paid the Cancellation Payment, PREMIER had no intent to enter
into an alternative transaction with an identified third party. PREMIER's
special counsel believed it was less likely that a federal income tax
deduction would be allowed for the Acquisition Payment. PREMIER's independent
accountants advised PREMIER that, based on PREMIER's special counsel's opinion
and the accountants' own review, the Cancellation Payment could be reflected
in PREMIER's audited financial statements net of its associated tax benefit.
In addition, PREMIER determined that, based on PREMIER's current and projected
financial condition, no regulatory approvals would be required in order for
PREMIER to pay the Acquisition Payment or the Cancellation Payment, that the
payment of these amounts would not cause PREMIER's regulatory capital to fall
below required minimums and would not cause the bank regulatory authorities to
place any restraints on PREMIER's operations. PREMIER also concluded that the
payment of these amounts should not raise any concerns about whether PREMIER
was operating in a "safe and sound" manner as required under banking laws and
regulations, although it was determined that confirmation of this conclusion
should be sought from the regulatory authorities. While PREMIER concluded that
it was likely to have the financial capacity to make the Acquisition Payment
or Cancellation Payment and that payment of such amounts was not likely to
conflict with banking laws and regulations, PREMIER's analysis showed that,
after payment of such amounts, PREMIER's capital was likely to be
significantly lower than that of its industry peers.
In December 1994, Messrs. Griffin and Williams and Mrs. Richmond, along with
PREMIER's special counsel, met with representatives of Merrill Lynch and
Merrill Lynch's counsel in New York City to review the status of PREMIER's
efforts, to determine what strategies to pursue in the future and to formulate
a presentation for a Special Projects Committee meeting scheduled for January
12, 1995 and a PREMIER Board meeting scheduled for January 18, 1995. At the
Special Projects Committee and Board meetings, PREMIER's management and
special counsel, and Merrill Lynch, presented detailed analyses of PREMIER's
situation in light of the facts that (i) BANC ONE would be able to exercise
the Option beginning July 1, 1995, (ii) BANC ONE had so far indicated that it
was unwilling to consummate a transaction at an earlier date at a price higher
than the Formula Price or allow PREMIER to pay a reduced Cancellation Payment
to terminate the Option prior to BANC ONE's exercise and (iii) no third party
acquiror had emerged. These presentations were made for the purposes of, among
other things, (i) assisting PREMIER's Board in its continuing preparations for
responding to BANC ONE's exercise of the Option or the potential emergence of
a third party acquiror and (ii) assisting PREMIER's Board in its continuing
evaluation of how PREMIER was conducting its operations in light of the
Option.
At its January 18, 1995 meeting, PREMIER's Board authorized and directed
PREMIER's management to do the following: (i) contact the appropriate
officials of the Federal Reserve and of the Office of the Comptroller of the
Currency (the "OCC") to seek their concurrence that no regulatory obstacles
existed to PREMIER's payment of the Acquisition Payment or the Cancellation
Payment; (ii) seek to have BANC ONE agree in writing to extend the time
PREMIER would have to deliver a Cancellation Notice; and (iii) operate PREMIER
in a manner designed to increase PREMIER's franchise value and earnings per
share, rather than book value per share, under the assumption that it was
unlikely that PREMIER would be purchased by BANC ONE for an amount based
solely on the Formula Price. In February 1995, John B. Noland and Thomas H.
Turner, outside directors of PREMIER, became members of the Special Projects
Committee. At that time, the members of the Special Projects Committee
together beneficially owned approximately 688,655 shares, or 2.0%, of
PREMIER's Common Stock. In March 1995, PREMIER received written assurances
from the Federal Reserve and the OCC
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that, based upon PREMIER's current and projected financial condition, they
would not object to PREMIER paying the Acquisition Payment or the Cancellation
Payment. In April 1995, PREMIER and BANC ONE entered into a written agreement
extending the time in which PREMIER could deliver a Cancellation Notice from
15 to 90 days after BANC ONE exercised the Option, thereby also extending by
75 days the time PREMIER had to pay the Cancellation Payment.
In mid-June 1995, Mr. Griffin received a telephone call from the Chief
Executive Officer of a large bank holding company (the "Other Bank"), who
asked to meet with Mr. Griffin to discuss in general terms a business
combination between PREMIER and the Other Bank. The Special Projects Committee
met on June 29, 1995, with PREMIER's management, PREMIER's special counsel and
Merrill Lynch in attendance, to discuss the financial condition and prospects
of the Other Bank, the impending exercisability of the Option, and the
parameters for negotiating with BANC ONE and the Other Bank. The Committee
authorized and directed Mr. Griffin to meet with representatives of the Other
Bank and to contact BANC ONE immediately to seek to commence negotiations
concerning the purchase of PREMIER by BANC ONE. On July 10th Mr. Boardman and
Phillip L. Weaver, an Assistant Vice President of BANC ONE, met with Messrs.
Griffin and Williams and Mrs. Richmond. After extensive discussion, the
representatives of PREMIER and BANC ONE reached agreement on the terms of a
proposal for BANC ONE to acquire PREMIER in an all-stock transaction at a
fixed exchange ratio valuing PREMIER's Common Stock at $20 per share based on
current market prices for BANC ONE Common Stock, with PREMIER being permitted
to pay a $0.25 per quarter dividend until PREMIER's shareholders became
entitled to receive dividends from BANC ONE. Mr. Griffin agreed to recommend
these terms to PREMIER's Special Projects Committee, and Mr. Boardman agreed
to recommend these terms to BANC ONE's management. On July 11th, Messrs. McCoy
and Boardman called Mr. Griffin to inform him that BANC ONE's management would
recommend these terms to BANC ONE's Board at a regular meeting scheduled for
July 18th. Also on July 11th, Messrs. Griffin and Williams met with the Chief
Executive Officer and Chief Financial Officer of the Other Bank. Following the
meeting, PREMIER's management consulted with Merrill Lynch and Mr. Blackman.
The next morning, Mr. Griffin informed the Chief Executive Officer of the
Other Bank that PREMIER's Board had a regular meeting scheduled for Wednesday,
July 19th and at that time would consider a new proposal from BANC ONE. He
asked the Chief Executive Officer if the Other Bank could be in a position to
make its best and final offer by noon on Monday, July 17th, and the Chief
Executive Officer agreed to do so. Over the weekend, Mr. Blackman, PREMIER's
management and special counsel, Merrill Lynch and Merrill Lynch's counsel
reviewed the form and content of the Merger Agreement, the form of which had
been proposed by BANC ONE and commented on by PREMIER and its special counsel
during PREMIER's and BANC ONE's negotiations in 1994.
On the morning of Monday, July 17, 1995, the Chief Financial Officer of the
Other Bank met with Mr. Griffin and Mr. Williams and stated that the Other
Bank was willing to acquire PREMIER in an all-stock transaction at a fixed
exchange ratio valuing PREMIER's stock at $21 per share based on the market
price of the Other Bank's stock at that time. The offer was conditioned,
however, on BANC ONE agreeing either to exercise the Option (after which
PREMIER would pay the Cancellation Payment), or to accept PREMIER stock
instead of cash in payment of the Acquisition Payment. The Other Bank believed
that this was a necessary condition for its business combination with PREMIER
to qualify for pooling-of-interests accounting treatment.
Later that day, the Special Projects Committee, with members of PREMIER's
management present and PREMIER's special counsel and Merrill Lynch present via
telephone conference, met to consider the proposals of BANC ONE and the Other
Bank. The Committee considered the relative historical, current and projected
financial condition, results of operations, earnings per share, dividends,
business plans and stock price performance of BANC ONE and the Other Bank. The
Committee also considered the significant risks and uncertainties associated
with the Other Bank's offer. The Committee concluded that BANC ONE was highly
unlikely to facilitate PREMIER's acquisition by a third party. The Committee
also concluded that although BANC ONE's cooperation was a necessary condition
for a business combination with the Other Bank to qualify for pooling-of-
interests accounting treatment, it was not clear that this would be sufficient
for the transaction to qualify for such accounting treatment. Finally, the
Committee determined that a material negative impact on the
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financial statements of the combined companies would result if pooling-of-
interests accounting treatment ultimately was not available. Based primarily
on these considerations, the Committee authorized and directed Mr. Griffin to
inform the representatives of the Other Bank that the Committee considered
BANC ONE's offer to be superior and to ask the Other Bank if it was willing to
increase its offer.
Mr. Blackman informed the Committee that he, along with PREMIER's
management, PREMIER's special counsel, Merrill Lynch and Merrill Lynch's
counsel, had over the preceding weekend reviewed the Merger Agreement proposed
by BANC ONE and that, while negotiations were still in progress, he was
generally satisfied with the form and content of the Merger Agreement. The
Committee authorized and directed PREMIER's management to have the draft
delivered to each member of PREMIER's Board so that the directors would have
the opportunity to become familiar with the document prior to the upcoming
meeting. The Committee then agreed unanimously that it would recommend the
BANC ONE proposal over the proposal of the Other Bank unless the Other Bank
increased its offer. On July 18, 1995, the Chief Executive Officer of the
Other Bank called Mr. Griffin and informed him that the Other Bank would not
increase its offer. Also on July 18th, BANC ONE's Board approved the Merger
Agreement.
On July 19th, PREMIER's Board met and considered BANC ONE's proposal.
Messrs. Griffin and Blackman reviewed the general history of PREMIER's
relationship and negotiations with BANC ONE and reviewed in detail the events
of the preceding few weeks. Mr. Blackman informed the Board that he had
participated in and supervised the review and negotiation of the Merger
Agreement and that he was satisfied with its form and content. He recounted
the deliberations of the Special Projects Committee with respect to the offers
of BANC ONE and the Other Bank and informed the Board that the Committee
unanimously recommended that PREMIER's Board accept BANC ONE's offer.
Representatives of Merrill Lynch then made a presentation to the Board,
described in greater detail under the caption "Opinion of the Financial
Advisor," and informed the Board that, in Merrill Lynch's opinion, the
Exchange Rate was fair to PREMIER's shareholders from a financial point of
view. (Shareholders are urged to review carefully the section of this
Prospectus and Proxy Statement entitled "Opinion of the Financial Advisor.")
PREMIER's special counsel then led the Board in a detailed review of the form
and content of the Merger Agreement. After further consideration and
discussion, PREMIER's Board unanimously approved the Merger Agreement.
RECOMMENDATION OF PREMIER'S BOARD AND REASONS FOR THE MERGER
PREMIER'S BOARD BELIEVES THAT THE MERGER IS FAIR TO, AND IN THE BEST
INTERESTS OF, PREMIER AND ITS SHAREHOLDERS. PREMIER'S BOARD UNANIMOUSLY
RECOMMENDS THAT SHAREHOLDERS VOTE FOR THE APPROVAL AND ADOPTION OF THE MERGER
AGREEMENT.
The terms of the Merger Agreement were the result of arm's-length
negotiations between PREMIER and BANC ONE. In reaching its decision to approve
the Merger Agreement, PREMIER's Board consulted with PREMIER's management, as
well as PREMIER's financial advisor and its special counsel, and considered
the factors described above and a number of additional factors, including the
following:
(i) The constraints imposed by the existing agreements with BANC ONE. As of
July 1, 1995, BANC ONE had the absolute contractual right to acquire
PREMIER at the Formula Price, subject only to PREMIER's ability and
willingness to make the Acquisition Payment or the Cancellation Payment.
If BANC ONE had exercised the Option in the third quarter of 1995 (so that
the Calculation Date would have been June 30, 1995), the Formula Price
would have been $17.41 and PREMIER's shareholders would have been entitled
to receive .532416 share of BANC ONE Common Stock for each share of
PREMIER Common Stock held as of the closing. BANC ONE would not have been
entitled to pay up to 49.9% of the purchase price in cash. The .617761
Exchange Rate in the Merger Agreement provides PREMIER's shareholders with
a value of $20.15 per share (based on the closing price of BANC ONE Common
Stock on July 18, 1995, the day before PREMIER's Board approved the Merger
Agreement), which price was at the time approximately 15% higher than the
Formula Price. In addition, PREMIER has the right pursuant to the
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Merger Agreement to declare and pay quarterly dividends of $0.25 per share
until the quarter in which PREMIER's shareholders become entitled to
receive dividends from BANC ONE. If PREMIER's shareholders do not approve
the Merger Agreement, or the Merger Agreement is terminated for other
reasons, the Option will be reinstated.
(ii) Uncertainties surrounding the long-term effect on PREMIER and its
shareholders of making the Cancellation Payment. As of June 30, 1995 the
Cancellation Payment would have been approximately $143 million in cash
($93 million net of associated tax benefits). Merrill Lynch's analysis
had indicated that, comparing various hypothetical alternatives,
PREMIER's shareholders might receive the highest value on a present value
basis if PREMIER were to pay the Cancellation Payment and soon thereafter
be acquired at median acquisition premiums being paid for companies
similar to PREMIER. This conclusion depended, among other things, upon
the Cancellation Payment being tax-deductible. PREMIER's shareholders'
ultimate receipt of a higher value if PREMIER were to make the
Cancellation Payment was subject to significant risks and uncertainties,
however, including the following: (a) PREMIER could not control the
timing of the Cancellation Payment, as it could only be made after BANC
ONE's notice of exercise of the Option, which could occur as late as the
second quarter of 1997; (b) in order to preserve the best case for
PREMIER's ability to deduct the Cancellation Payment on its federal
income tax return, PREMIER could not have an intent to enter into a
business combination with an identified third party at the time PREMIER
made the Cancellation Payment; and (c) PREMIER could not control whether
a third party would be interested in purchasing PREMIER at the time it
paid the Cancellation Payment nor the price that such an acquiror would
offer. In addition, Merrill Lynch's analysis assumed, among other things,
that PREMIER's financial condition would remain strong and that
acquisition multiples would not decrease, both of which were subject to
some uncertainty. The Board also considered the following risks involved
if PREMIER were to pay the Cancellation Payment and no third party
acquiror were to emerge soon thereafter: (a) PREMIER's capital levels,
after making the Cancellation Payment, although likely to be above
regulatory minimums, were also likely to be significantly below the
capital levels of its industry peers; and (b) Merrill Lynch's opinion was
that payment of the Cancellation Payment could have a negative effect on
PREMIER's Common Stock price for a period of time.
(iii) The Other Bank's offer. Primarily for the reasons described above under
the caption "--Recommendation of PREMIER's Board and Reasons for the
Merger," PREMIER's Board determined that BANC ONE's proposal was
substantially more likely to provide PREMIER's shareholders with the
value offered.
(iv) The absence of interest by any party (other than the Other Bank) in
acquiring PREMIER, notwithstanding Merrill Lynch's efforts to solicit
such interest in 1994 and the fact that PREMIER's ability to terminate
the Option by making the Acquisition Payment or the Cancellation Payment
had been publicly disclosed by PREMIER since 1992. Accordingly, PREMIER's
Board concluded that the emergence of a third party with the capacity and
interest to acquire PREMIER at a price that would provide PREMIER's
shareholders with more value than the value to be received under the
Merger Agreement was subject to a substantial degree of risk.
(v) The likelihood that any acquisition of PREMIER by BANC ONE or by a third
party at any time while the 1992 Agreement was in effect or during a
period up to two years after termination of the 1992 Agreement would have
to be accounted for using the purchase method of accounting, rather than
the pooling-of-interests method that has been used more commonly in recent
large bank mergers and acquisitions. For certain bank acquirors, the
utilization of the pooling-of-interests method would be critical to their
making an acquisition of PREMIER. Consequently, during a period when the
pooling-of-interests method was not available, there would be fewer
bidders interested in PREMIER.
(vi) PREMIER's and BANC ONE's historical, current and projected financial
condition, results of operations, earnings per share, dividends, business
plans and stock price performance.
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(vii) That the consideration in the Merger Agreement is in the form of BANC
ONE Common Stock. The Merger allows PREMIER's shareholders to become
shareholders in an institution that is ranked among the ten largest bank
holding companies in the United States on the basis of asset size as of
June 30, 1995 and that, in PREMIER's Board's opinion, is well-positioned
to confront successfully the current and prospective economic,
regulatory and competitive challenges facing financial institutions.
(viii) Certain risks associated with the Merger Agreement, including the risk
that, if the Merger Agreement is terminated, dividends paid by PREMIER
would decrease the Formula Price.
(ix) The opinion of Merrill Lynch as to the fairness of the Exchange Rate to
PREMIER's shareholders from a financial point of view. (See "--Opinion of
the Financial Advisor.")
(x) The expectation that the Merger will be a tax-free transaction to PREMIER
and its shareholders. (See "--Federal Income Tax Consequences.")
The foregoing discussion of the information and factors considered by
PREMIER's Board is not intended to be exhaustive but is believed to include
all material factors considered by PREMIER's Board. In reaching its
determination to approve and recommend the Merger, PREMIER's Board did not
assign any relative or specific weights to the foregoing factors, and
individual directors may have given differing weights to different factors.
Throughout its deliberations, PREMIER's Board received the advice of its
special legal counsel and its financial advisor. After deliberating with
respect to the Merger Agreement and considering, among other things, the
matters discussed above, PREMIER's Board, by unanimous vote of all directors,
approved and adopted the Merger Agreement as being in the best interests of
PREMIER and its shareholders. PREMIER's Board is unanimous in its
recommendation that holders of PREMIER Common Stock vote for approval and
adoption of the Merger Agreement.
As of August 31, 1995, the directors and executive officers of PREMIER
together with their affiliates, as a group, were entitled to vote
approximately 2,587,609 shares of PREMIER Common Stock representing
approximately 7.5% of the shares outstanding. These persons will be entitled
to receive the same consideration for their shares as any other PREMIER
shareholder upon approval of the Merger. PREMIER believes that all of the
directors' and executive officers' and their respective affiliates' shares
will be voted in favor of the Merger. After the Merger, PREMIER's directors
and executive officers will own less than 1% of the outstanding shares of BANC
ONE Common Stock.
BANC ONE believes that the affiliation of PREMIER with BANC ONE will provide
BANC ONE with a meaningful presence in Louisiana and an expansion of BANC
ONE's customer base and assets. Such expansion will provide BANC ONE with
greater geographic diversity and the opportunity to realize increased
economies of scale while serving new customers with the expertise and
assistance of the capable and experienced staff of PREMIER.
OPINION OF THE FINANCIAL ADVISOR
PREMIER originally retained Merrill Lynch in 1990 as its financial advisor
in connection with its efforts to obtain capital, which efforts resulted in
the existing agreements between PREMIER and BANC ONE described above. In 1994
PREMIER again engaged Merrill Lynch as its financial advisor to assist in
analyzing alternatives available to PREMIER under the existing agreements with
BANC ONE. Representatives of Merrill Lynch attended the meeting of the Board
of Directors of PREMIER held on July 19, 1995 at which the Board considered
and approved the Merger Agreement. At the July 19, 1995 meeting, Merrill Lynch
rendered its oral opinion (which was subsequently confirmed in writing) that,
based upon and subject to the various considerations set forth therein, the
proposed Exchange Rate (which was determined by negotiations between PREMIER
and BANC ONE) is fair to holders of PREMIER Common Stock (other than BANC ONE)
from a financial point of view. Such opinion was reconfirmed in writing as of
the date of this Prospectus and Proxy Statement. No
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limitations were imposed by PREMIER upon Merrill Lynch with respect to
investigations made or procedures followed by Merrill Lynch in rendering its
opinions.
The full text of Merrill Lynch's opinion as of the date of this Prospectus
and Proxy Statement, which sets forth assumptions made, matters considered and
limits on the review undertaken by Merrill Lynch, is attached hereto as
Appendix A. PREMIER shareholders are urged to read the opinion in its
entirety. The summary set forth in this Prospectus and Proxy Statement of the
Merrill Lynch opinion is qualified in its entirety by reference to the full
text of such opinion.
Merrill Lynch's opinion is directed only to the Exchange Rate and does not
constitute a recommendation to any PREMIER shareholder as to how such
shareholder should vote at the Special Meeting.
In connection with its opinion as of the date of this Prospectus and Proxy
Statement, Merrill Lynch among other things: (i) reviewed PREMIER's Annual
Reports, Forms 10-K and related financial information for the three fiscal
years ended December 31, 1994 and PREMIER's Quarterly Reports on Form 10-Q and
the related unaudited financial information for the quarterly periods ending
March 31, 1995 and June 30, 1995; (ii) reviewed BANC ONE's Annual Reports,
Forms 10-K and related financial information for the three fiscal years ended
December 31, 1994 and BANC ONE's Quarterly Reports on Form 10-Q and the
related unaudited financial information for the quarterly periods ending March
31, 1995 and June 30, 1995; (iii) reviewed certain information, including
financial forecasts, relating to the business, earnings, assets and prospects
of PREMIER and BANC ONE, furnished to it by PREMIER and BANC ONE; (iv)
conducted discussions with members of senior management of PREMIER and BANC
ONE concerning their respective businesses, operations, regulatory condition
and prospects; (v) reviewed the historical market prices and trading activity
for the PREMIER Common Stock and the BANC ONE Common Stock and compared them
with those of certain publicly traded companies which it deemed to be
relevant; (vi) compared the results of operations of PREMIER and BANC ONE with
those of certain companies which it deemed to be relevant; (vii) compared the
proposed financial terms of the transactions contemplated by the Merger
Agreement with the financial terms of certain other mergers and acquisitions
which it deemed to be relevant; (viii) analyzed the pro forma impact of the
transaction on the earnings and book value per share, consolidated
capitalization and certain balance sheet and profitability ratios of BANC ONE;
(ix) participated in discussions and negotiations among representatives of
PREMIER and BANC ONE; (x) reviewed the Merger Agreement; and (xi) reviewed
such other financial studies and analyses and performed such other
investigations and took into account such other matters as it deemed necessary
to the rendering of its opinion.
In preparing its opinion, Merrill Lynch relied on the accuracy and
completeness of all information supplied or otherwise made available to it by
PREMIER and BANC ONE, and did not assume any responsibility for independently
verifying such information or undertaking an independent evaluation or
appraisal of the assets or liabilities of PREMIER or BANC ONE or any of their
subsidiaries and was not furnished any such evaluation or appraisal. Merrill
Lynch also relied upon the managements of PREMIER and BANC ONE as to the
reasonableness and achievability of the financial operating forecasts (and the
assumptions and bases therefor) provided to Merrill Lynch. In that regard,
Merrill Lynch assumed that such forecasts and projections regarding future
economic conditions and results of operations reflected the best currently
available estimates and judgments of such respective managements and that such
projections and forecasts would be realized in the amounts and the time
periods estimated by the managements of PREMIER and BANC ONE. Merrill Lynch's
opinion is necessarily based on economic, market and other conditions as in
effect on, and the information made available to it as of, the date of the
opinion. Merrill Lynch is not an expert in the evaluation of allowances for
loan losses and did not assume any responsibility for making an independent
evaluation of the adequacy of the allowance for loan losses of PREMIER and
BANC ONE nor did Merrill Lynch review any individual credit files.
In connection with rendering its opinion to the PREMIER Board on July 19,
1995 and updated as of the date of this Prospectus and Proxy Statement,
Merrill Lynch performed a variety of financial analyses, which are summarized
below. Merrill Lynch believes that its analyses must be considered as a whole
and that selecting
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portions of such analyses and the factors considered therein, without
considering all factors and analyses, could create an incomplete view of the
analyses and the processes underlying Merrill Lynch's opinions. The
preparation of a fairness opinion is a complex process involving subjective
judgments and is not necessarily susceptible to partial analysis or summary
description. In its analyses, Merrill Lynch also took into account its
assessment of general economic, market and financial conditions and its
experience in other merger transactions, as well as its experience in
securities valuation and its knowledge of the banking industry generally. With
respect to the peer group analysis and selected merger transaction analysis
summarized below, no public company or transaction utilized as a comparison is
identical to PREMIER or BANC ONE or the Merger, and such analyses necessarily
involve complex considerations and judgments concerning the differences in
financial and operating characteristics of the companies and transactions and
other factors that could affect the companies concerned. Any estimates
contained in Merrill Lynch's analyses are not necessarily indicative of future
results or values, which may be significantly more or less favorable than such
estimates. Estimates of values of companies do not purport to be appraisals or
necessarily reflect the prices at which companies or their securities actually
may be sold.
For purposes of its opinions, Merrill Lynch reviewed the 1992 Agreement, the
Capital Note Agreement and the Capital Note, and the Warrant Agreement and the
Warrant, and considered the effect of such agreements on the Merger and
possible alternative transactions involving PREMIER. In connection with the
analyses described below, Merrill Lynch evaluated the Exchange Rate using four
alternative cases: (i) assuming that the 1992 Agreement and the Warrant
Agreement had not been entered into, (ii) assuming the payment by PREMIER to
BANC ONE of the Cancellation Payment with an IRS allowance for a corresponding
tax deduction for such payment (the "Tax Effected Analysis"), (iii) assuming
the payment by PREMIER to BANC ONE of the Cancellation Payment without an IRS
allowance for a corresponding tax deduction for such payment (the "Non-Tax
Effected Analysis") and (iv) assuming that BANC ONE exercises the Warrants
(the "Warrant Analysis"). Case (i) was analyzed primarily for reference only,
since the 1992 Agreement had, in fact, been entered into and was in full force
and effect at the time of Merrill Lynch's analysis. For each of cases (ii),
(iii) and (iv) Merrill Lynch recalculated PREMIER's book value per share,
tangible book value per share and estimated 1995 and 1996 earnings per share
to reflect the effects of such events in order to provide reference standards
against which to evaluate the fairness of the Exchange Rate from a financial
point of view. For purposes of calculating the effect on future earnings per
share, Merrill Lynch assumed lost earnings on the Cancellation Payment of 7.0%
pre-tax and earnings from cash on the exercise of the Warrants of 7.0% pre-
tax.
The projections prepared by PREMIER's management and furnished to Merrill
Lynch for use in its financial analyses summarized below were prepared for
internal management use only and not with a view towards public disclosure.
PREMIER does not publicly disclose internal management projections of this
type. These projections were based on numerous variables and assumptions that
are inherently uncertain and that may not be within the control of PREMIER's
management, including without limitation factors related to general economic
and competitive conditions and prevailing interest rates. Accordingly, actual
results could vary significantly from those set forth in such projections.
The following is a summary of the analyses presented by Merrill Lynch to the
PREMIER Board of Directors on July 19, 1995 in connection with its opinion:
Transaction Summary. Merrill Lynch reviewed with the PREMIER Board the key
financial terms of the proposed Merger. Merrill Lynch noted that based on BANC
ONE's closing stock price of $32.625 on July 18, 1995, the then current market
value of the proposed Merger to PREMIER shareholders was $20.15 per share,
representing a 8.9% premium to PREMIER's July 18, 1995 closing market price of
$18.50 per share. Merrill Lynch noted that the $20.15 value per share
represented a multiple of 1.46 times PREMIER's fully diluted book value per
share as of June 30, 1995 and a multiple of 1.60 times PREMIER's fully diluted
tangible book value per share. Merrill Lynch also explained that the $20.15
value represented a multiple of 9.64 times PREMIER's latest 12-months earnings
per share as of June 30, 1995, a multiple of 9.88 times management estimates
for PREMIER's 1995 earnings per share and a multiple of 9.51 times management
estimates for PREMIER's 1996 earnings per share. Under the Non-Tax Effected
Analysis, the $20.15 per share value represented a multiple of
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2.09 times fully diluted book value per share, 2.39 times fully diluted
tangible book value per share, 10.60 times latest 12-months earnings per
share, 10.88 times management estimated 1995 earnings per share and 10.43
times management estimated 1996 earnings per share. Under the Tax Effected
Analysis, the $20.15 per share value represented a multiple of 1.82 times
fully diluted book value per share, 2.04 times fully diluted tangible book
value per share, 10.24 times latest 12-months earnings per share, 10.51 times
management estimated 1995 earnings per share and 10.09 times management
estimated 1996 earnings per share. Under the Warrant Analysis, the $20.15 per
share value represented a multiple of 1.70 times fully diluted book value per
share, 1.84 times fully diluted tangible book value per share, 12.25 times
latest 12-months earnings per share, 12.54 times management estimated 1995
earnings per share and 12.08 times management estimated 1996 earnings per
share.
Pro Forma Analysis. Merrill Lynch reviewed the pro forma impact of the
proposed Merger on BANC ONE's and PREMIER's book value per share and estimated
1996 and 1997 earnings per share. This analysis showed that the Merger would
have no significant effect on BANC ONE's estimated 1996 and 1997 earnings per
share and would be accretive to PREMIER's estimated 1996 and 1997 earnings per
share by 4.31% and 11.18%, respectively, in each case after giving effect to
assumed pre-tax Merger synergies equal to 7.5% and 15.0% of PREMIER's
estimated non-interest expense for 1996 and 1997, respectively. The analysis
also showed that the Merger would result in a book value and tangible book
value increase for BANC ONE of 3.63% and 0.73% respectively, and book value
and tangible book value dilution for PREMIER of 11.92% and 12.54%,
respectively. Merrill Lynch also explained that based upon BANC ONE's current
dividend payments, PREMIER's annual dividend per share would be $0.84. PREMIER
has not paid any dividends since 1986, in part because the Formula Price under
the 1992 Agreement was based on PREMIER's book value per share and,
accordingly, management has generally followed a policy during the past
several years of retaining earnings in order to maximize book value.
Summary Comparison of Selected Institutions. Merrill Lynch compared selected
balance sheet data, asset quality, capitalization and profitability ratios and
market statistics using financial data at or for the twelve months ended March
31, 1995 and market data as of July 18, 1995 for PREMIER to a group of 13 bank
holding companies consisting of ArgentBank, BOK Financial Corporation, Centura
Banks, Inc., Deposit Guaranty Corp., First Commercial Corporation, First
Commerce Corporation, First Citizens BancStock, Inc., Hibernia Corporation,
One Valley Bancorp of WV, Inc., Trustmark Corporation, Union Planters
Corporation, Whitney Holding Corp. and Zions Bancorporation (the "PREMIER Peer
Group"). This analysis showed that: (i) PREMIER had a ratio of noninterest
expense to average assets of 3.77% compared to a mean ratio of 3.47% and a
median ratio of 3.47% for the PREMIER Peer Group; (ii) PREMIER had an
efficiency ratio (defined as noninterest expense divided by the sum of
noninterest income plus net interest income before provision for loan losses)
of 66.32% compared to a mean ratio of 62.94% and a median ratio of 63.40% for
the PREMIER Peer Group; (iii) PREMIER had a return on average assets of 1.31%
compared to a mean return of 1.22% and a median return of 1.28% for the
PREMIER Peer Group; (iv) PREMIER had a return on average equity of 16.66%
compared to a mean return of 14.53% and a median return of 14.97% for the
PREMIER Peer Group; (v) PREMIER had a ratio of tangible common equity to
tangible assets of 7.38% (or 5.05% under the Non-Tax Effected Analysis and
5.88% under the Tax Effected Analysis) compared to a mean ratio of 8.23% and a
median ratio of 7.84% for the PREMIER Peer Group; (vi) PREMIER had a ratio of
nonperforming loans to total loans of 0.76% compared to a mean ratio of 0.62%
and a median ratio of 0.50% for the PREMIER Peer Group; (vii) PREMIER had a
ratio of nonperforming assets to total assets of 0.61% compared to a mean
ratio of 0.40% and a median ratio of 0.29% for the PREMIER Peer Group; (viii)
PREMIER had a ratio of loan loss reserve to nonperforming assets of 182.54%
compared to a mean ratio of 321.63% and a median ratio of 338.05% for the
PREMIER Peer Group; (ix) PREMIER had a price to 1996 estimated earnings per
share multiple of 8.73x compared to a mean multiple of 9.85x and a median
multiple of 9.90x for the PREMIER Peer Group (PREMIER 1996 estimated earnings
are based on management estimates and PREMIER Peer Group 1996 estimated
earnings are based on First Call earnings estimates); (x) PREMIER had a price
to book value multiple of 1.39x compared to a mean multiple of 1.67x and a
median multiple of 1.69x for the PREMIER Peer Group; (xi) PREMIER had a price
to tangible book value of 1.55x compared to a mean multiple of 1.87x and a
median multiple of 1.83x for the PREMIER Peer Group; and (xii) PREMIER had a
dividend yield of 0.00% compared to a mean yield of
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2.68% and a median yield of 2.92% for the PREMIER Peer Group. Merrill Lynch
then computed an imputed value for the PREMIER Common Stock based upon current
trading multiples for the PREMIER Peer Group as of July 18, 1995. This
analysis yielded a range of imputed values of $20.89 to $22.44 per share using
the mean and median of the trading multiples for the PREMIER Peer Group (or a
range of $17.14 to $20.91 under the Tax Effected Analysis, $14.57 to $20.15
under the Non-Tax Effected Analysis and $16.45 to $19.56 under the Warrant
Analysis) and a range of imputed values of $16.03 to $38.49 per share using
the full range of low and high multiples for the PREMIER Peer Group (or a
range of $12.56 to $30.15 under the Tax Effected Analysis, $10.68 to $25.64
under the Non-Tax Effected Analysis and $14.01 to $33.62 under the Warrant
Analysis). First Call is a data service that monitors and publishes
compilations of earnings estimates produced by selected research analysts
regarding companies of interest to institutional shareholders.
Merrill Lynch also compared selected balance sheet data, asset quality,
capitalization and profitability ratios and market statistics using financial
data at or for the twelve months ended March 31, 1995 and market data as of
July 18, 1995 for BANC ONE to a group of 16 bank holding companies consisting
of BankAmerica Corporation, Barnett Banks, Inc., Bank of New York Company,
Bank of Boston Corporation, Fleet Financial Group, First Chicago Corporation,
First Union Corporation, First Interstate Bancorp, KeyCorp, NationsBank
Corporation, NBD Bancorp, Inc., Norwest Corporation, PNC Bank Corp., SunTrust
Banks, Inc., Wachovia Corporation and Wells Fargo & Company (the "BANC ONE
Peer Group"). This analysis showed that: (i) BANC ONE had a ratio of
noninterest expense to average assets of 4.25% compared to a mean ratio of
3.44% and a median ratio of 3.40% for the BANC ONE Peer Group; (ii) BANC ONE
had an efficiency ratio of 63.65% compared to a mean ratio of 58.76% and a
median ratio of 59.25% for the BANC ONE Peer Group; (iii) BANC ONE had a
return on average assets of 1.38% compared to a mean return of 1.27% and a
median return of 1.29% for the BANC ONE Peer Group; (iv) BANC ONE had a return
on average equity of 15.72% compared to a mean return of 17.08% and a median
return of 17.00% for the BANC ONE Peer Group; (v) BANC ONE had a ratio of
tangible common equity to tangible assets of 8.24% compared to a mean ratio of
6.09% and a median ratio of 5.84% for the BANC ONE Peer Group; (vi) BANC ONE
had a ratio of nonperforming loans to total loans of 0.59% compared to a mean
ratio of 0.78% and a median ratio of 0.72% for the BANC ONE Peer Group; (vii)
BANC ONE had a ratio of nonperforming assets to total assets of 0.51% compared
to a mean ratio of 0.70% and a median ratio of 0.64% for the BANC ONE Peer
Group; (viii) BANC ONE had a ratio of loan loss reserves to nonperforming
assets of 196.91% compared to a mean ratio of 263.40% and a median ratio of
226.59% for the BANC ONE Peer Group; (ix) BANC ONE had a price to 1996
estimated earnings per share multiple of 9.24x compared to a mean multiple of
8.59x and a median multiple of 8.46x for the BANC ONE Peer Group (1996
estimated earnings are based on First Call earnings estimates); (x) BANC ONE
had a price to book value multiple of 1.73x compared to a mean multiple of
1.68x and a median multiple of 1.58x for the BANC ONE Peer Group; (xi) BANC
ONE had a price to tangible book value of 1.85x compared to a mean multiple of
2.20x and a median multiple of 1.96x for the BANC ONE Peer Group; and (xii)
BANC ONE had a dividend yield of 4.17% compared to a mean yield of 3.58% and a
median yield of 3.57% for the BANC ONE Peer Group. Merrill Lynch then computed
an imputed value for the BANC ONE Common Stock based upon current trading
multiples for the BANC ONE Peer Group as of July 18, 1995. This analysis
yielded a range of imputed values of $29.75 to $38.73 per share using the mean
and median of the trading multiples for the BANC ONE Peer Group and a range of
imputed values of $23.58 to $63.01 per share using the full range of low and
high multiples for the BANC ONE Peer Group.
Discounted Dividend Analysis. Merrill Lynch performed a discounted dividend
analysis for PREMIER on a stand-alone basis using management earnings
estimates, discount rates ranging from 13.0% to 15.0% and terminal price to
earnings multiples of 9.0x to 11.0x applied to the year 2000 forecasted
earnings, and projecting the maximum dividends that would permit projected
growth while maintaining a 6% tangible common equity to assets ratio. Merrill
Lynch selected these discount rates because they represented a reasonable
range above and below the historical cost of equity capital to PREMIER and
comparable bank holding companies and these terminal value multiples because
they represented a reasonable range above and below the historical market
multiples of PREMIER and comparable bank holding companies. This analysis
showed a range of present values per share of PREMIER Common Stock from $18.92
to $22.74 (or $14.94 to $18.75 under the Non-Tax Effected
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Analysis, $16.26 to $20.07 under the Tax Effected Analysis and $16.02 to
$18.89 under the Warrant Analysis). Merrill Lynch noted that the discounted
cash flow analysis was included because it is a widely used valuation
methodology, but noted that the results of such methodology are highly
dependent upon the numerous assumptions that must be made, including earnings
growth rates, dividend payout rates, terminal values and discount rates.
Summary of Selected Bank Mergers and Acquisitions. Merrill Lynch compared
the ratios of price to latest twelve months earnings, price to book, price to
tangible book and deposit premium for the proposed Merger to the high, mean,
median and low ratios for (i) selected bank acquisitions in five southern
states (Alabama, Arkansas, Louisiana, Mississippi and Oklahoma) since January
1, 1994 with a transaction value between $50 million and $1 billion (the
"Selected Southern Transactions"), and (ii) nationwide bank acquisitions
announced since January 1, 1994 with a transaction value between $250 million
and $1 billion (the "Selected Nationwide Transactions"). This analysis showed
that: (i) the price to earnings for the proposed Merger was 9.64x (or 10.60x
under the Non-Tax Effected Analysis, 10.24x under the Tax Effected Analysis
and 12.25x under the Warrant Analysis) compared to a mean of 14.21x and a
median of 14.14x for the Selected Southern Transactions and a mean of 16.15x
and a median of 14.47x for the Selected Nationwide Transactions; (ii) the
price to book value for the proposed Merger was 1.46x (or 2.09x under the Non-
Tax Effected Analysis, 1.82x under the Tax Effected Analysis and 1.70x under
the Warrant Analysis) compared to a mean of 2.26x and a median of 2.06x for
the Selected Southern Transactions and a mean of 2.16x and a median of 2.05x
for the Selected Nationwide Transactions; and (iii) the price to tangible book
value for the proposed Merger was 1.60x (or 2.39x under the Non-Tax Effected
Analysis, 2.04x under the Tax Effected Analysis and 1.84x under the Warrant
Analysis) compared to a mean of 2.33x and a median of 2.23x for the Selected
Southern Transactions and a mean of 2.31x and a median of 2.29x for the
Selected Nationwide Transactions. The imputed values per share for PREMIER
Common Stock based upon the various transaction multiples reviewed by Merrill
Lynch yielded a range of imputed values of $26.76 to $31.05 (or $22.08 to
$25.60 under the Tax Effected Analysis, $18.86 to $24.23 under the Non-Tax
Effected Analysis and $21.15 to $26.73 under the Warrant Analysis) based upon
the median and mean of the Selected Southern Transactions multiples and a
range of $26.51 to $30.56 (or $22.64 to $28.58 under the Tax Effected
Analysis, $19.33 to $27.52 under the Non-Tax Effected Analysis and $21.48 to
$25.52 under the Warrant Analysis) based upon the Selected Nationwide
Transaction multiples. Merrill Lynch noted that the existence of the 1992
Agreement made a comparison of PREMIER's circumstances to those recent bank
mergers and acquisitions less meaningful.
Net Present Value of Selected Alternatives. Merrill Lynch prepared an
analysis of the net present value per share of PREMIER Common Stock under
various scenarios including: (i) BANC ONE acquires PREMIER pursuant to the
terms of the 1992 Agreement (the "1992 Acquisition Alternative"), (ii) the
payment by PREMIER to BANC ONE of the Cancellation Payment with an IRS
allowance for a corresponding tax deduction for such payment and PREMIER
remaining independent (the "Market Trading Alternative"), (iii) the payment by
PREMIER to BANC ONE of the Cancellation Payment without an IRS allowance for a
corresponding tax deduction for such payment followed by an acquisition of
PREMIER by a third party (the "Non-Tax Effected/ Acquisition Alternative"),
(iv) the payment by PREMIER to BANC ONE of the Cancellation Payment with an
IRS allowance for a corresponding tax deduction for such payment followed by
an acquisition of PREMIER by a third party (the "Tax Effected/Acquisition
Alternative") and (v) BANC ONE elects to exercise its Warrant followed by an
acquisition of PREMIER by a third party (the "Warrant/Acquisition
Alternative"). Merrill Lynch used discount rates of 14% in scenarios (i) and
(ii), 15% in scenario (iii) and 16% in scenarios (iv) and (v), reflecting
among other things the greater volatility assumed to be present as a result of
lower capitalization levels following payment of the Cancellation Payment and
higher levels of uncertainty regarding such scenarios.
Based on a payment of the Cancellation Payment on different dates ranging
from June 30, 1995 through December 31, 1996, the net present value per share
was calculated on dates ranging from June 30, 1995 through December 31, 1997.
The terminal book value multiple used was 1.6x under the Market Trading
Alternative, 2.10x under the Tax Effected/Acquisition and Non-Tax
Effected/Acquisition Alternatives and 2.0x under the Warrant/Acquisition
Alternative. Based on these assumptions, the net present value per share of
PREMIER
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Common Stock under the 1992 Acquisition Alternative would be $17.41 on June
30, 1995 and $18.08 on December 31, 1997. Assuming the Cancellation Payment
was made on June 30, 1995, the net present value per share of PREMIER Common
Stock would be $18.61 on June 30, 1995 and $18.01 on December 31, 1997 under
the Market Trading Alternative, $20.67 on June 30, 1995 and $20.46 on December
31, 1997 under the Non-Tax Effected/Acquisition Alternative, $23.01 on
December 31, 1996 and $22.24 on December 31, 1997 under the Tax
Effected/Acquisition Alternative (assuming that an acquisition and a
corresponding tax deduction is not possible in the first year after the
Cancellation Payment is paid) and $23.81 on June 30, 1995 and $18.69 on
December 31, 1997 under the Warrant/Acquisition Alternative. This analysis did
not purport to be indicative of actual values or expected values of the shares
of PREMIER Common Stock. Merrill Lynch noted that the results of such analysis
are highly dependent upon the numerous assumptions that must be made,
including terminal values and discount rates.
In connection with rendering its opinion dated the date of this Prospectus
and Proxy Statement, Merrill Lynch performed procedures to update certain of
the foregoing analyses and reviewed the assumptions on which such analyses
were based, and the factors considered in connection therewith.
Merrill Lynch is a nationally recognized investment banking firm and is
continually engaged in the valuation of businesses and securities in
connection with mergers and acquisitions, negotiated underwritings,
competitive biddings, secondary distributions of listed and unlisted
securities, and valuations for estate, corporate and other purposes. PREMIER
selected Merrill Lynch as a financial advisor in connection with the Merger
because of its reputation and experience in transactions such as the Merger
and Merrill Lynch's familiarity with PREMIER and the 1992 Agreement based on
its role as financial advisor to PREMIER in connection with that transaction.
In addition to the financial advisory services referred to above, Merrill
Lynch has from time to time provided underwriting, financial advisory and/or
brokerage services to PREMIER and BANC ONE, for all of which Merrill Lynch has
received customary compensation. In the ordinary course of business, Merrill
Lynch makes a market in PREMIER Common Stock and BANC ONE Common Stock and
trades the debt and equity securities of PREMIER and BANC ONE for its own
account and for the account of its customers and may at any time hold a long
or short position in such securities.
PREMIER and Merrill Lynch entered into a letter agreement in 1994 relating
to the services to be provided by Merrill Lynch in connection with PREMIER's
consideration of various business combination alternatives, including the 1992
Agreement and possible amendments thereto. Pursuant to that letter agreement,
PREMIER agreed to pay Merrill Lynch fees as follows: (i) a cash fee of
$250,000, which was paid upon execution of the letter agreement, (ii) a cash
fee of $375,000 which was paid on June 30, 1994, (iii) an additional cash fee
of $375,000 which was paid upon the execution of the Merger Agreement and (iv)
if PREMIER and BANC ONE or a third party merge or enter into some other form
of business combination during the period Merrill Lynch is retained by PREMIER
or in a period up to two years thereafter, an additional fee of .60% of the
incremental value per share received by PREMIER shareholders in excess of the
Base Value. The Base Value was defined as (i) $20.00 from the date of the
letter agreement until June 30, 1995 and (ii) the "Company Common Stock
Exchange Value Per Share" (as defined in the 1992 Agreement) on and after June
30, 1995. Based on the closing sale price of BANC ONE common stock on July 19,
1995, the fees to be paid to Merrill Lynch pursuant to the provisions of the
letter agreement described in clause (iv) above would total approximately
$495,000. In such letter, PREMIER also agreed to reimburse Merrill Lynch for
its reasonable out-of-pocket expenses and to indemnify Merrill Lynch against
certain liabilities, including liabilities under the Federal securities laws.
CONDITIONS TO THE MERGER; TERMINATION
Consummation of the Merger is subject to satisfaction of a number of
conditions, including:
(1) the receipt of all necessary approvals of the transactions contemplated
by the Merger Agreement by governmental agencies and authorities,
including the Federal Reserve, and each of such approvals shall remain
in full force and effect at the Effective Time;
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(2) there being no change in the consolidated financial condition,
aggregate net assets, shareholders' equity, business or operating
results of PREMIER and its subsidiaries, taken as a whole, or BANC ONE
and its subsidiaries, taken as a whole, from March 31, 1995 to the
Effective Time, that has had a material adverse effect on the business,
operations, financial condition or results of operations of BANC ONE
and its subsidiaries, taken as a whole, or PREMIER and its
subsidiaries, taken as a whole, or on the ability of BANC ONE or
PREMIER to consummate the transactions contemplated by the Merger
Agreement (a "BANC ONE Material Adverse Effect" or a "PREMIER Material
Adverse Effect," as the case may be);
(3) compliance by PREMIER, BANC ONE and PAC with their respective covenants
and confirmation of their respective representations and warranties as
set forth in the Merger Agreement, including the agreement of BANC ONE
that it will not acquire or enter into negotiations to acquire,
directly or indirectly, any bank located in Louisiana (other than
Premier Bank) with deposits in excess of $2 billion without the written
consent of PREMIER, which consent may not be unreasonably withheld and
including the agreement of PREMIER that, except with the approval of
BANC ONE or as otherwise permitted by the Merger Agreement, it will
not:
(a) pay dividends, except the dividends described above under the
caption "MERGER--General";
(b) effect any changes in connection with its equity capitalization,
except as related to certain outstanding stock options and the
issuance of shares of PREMIER Common Stock in connection with
PREMIER's acquisition of HNB Corporation, described below; or
(c) except as may be directed by any regulatory agency, conduct its
banking operations other than in the ordinary course of business;
(4) approval of the Merger Agreement and the Merger by the requisite vote
of shareholders of PREMIER Common Stock (See "MERGER--General, and
"VOTING AND MANAGEMENT INFORMATION--Voting");
(5) receipt by PREMIER and BANC ONE of the opinion, dated as of the Closing
Date, relative to the Federal income tax consequences of the Merger
referred to under the caption "MERGER--Federal Income Tax
Consequences";
(6) receipt by BANC ONE of an opinion from PREMIER's counsel and receipt by
PREMIER of an opinion from counsel for BANC ONE and PAC, which opinions
are to be in the general form of those annexed to the Merger Agreement;
(7) the shares of BANC ONE Common Stock to be issued in exchange for
PREMIER Common Stock shall have been approved for listing on the New
York Stock Exchange ("NYSE");
(8) the total number of shares of PREMIER Common Stock issued and
outstanding (not including treasury shares held by PREMIER), together
with the total number of shares of PREMIER Common Stock related to
outstanding options with respect to The Premier Stock Option Plan
shares, shall not be more than 35,388,832 shares;
(9) the holders of all credit agreements on which PREMIER or any of its
subsidiaries is the maker, issuer or guarantor and which contain
provisions which make the acquisition of PREMIER by or its merger with
or into another entity a condition of default or acceleration, which
default or acceleration would have a PREMIER Material Adverse Effect,
shall have provided BANC ONE with a written waiver of all such
provisions;
(10) the opinion of Merrill Lynch attached as Appendix A shall not have
been withdrawn prior to the Effective Time; and
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(11) the receipt by BANC ONE of an opinion from PREMIER's counsel to the
effect that, in the opinion of such counsel, PREMIER has taken action
with respect to the PREMIER Rights Plan appropriate to prevent the
approval, execution or delivery of the Merger Agreement or the
acquisition of shares of PREMIER Common Stock by BANC ONE pursuant
thereto, or consummation of the Merger or other transaction
contemplated by the Merger Agreement from resulting in the grant,
issuance or triggering of any right or entitlement or the obligation
to grant or issue any interest in PREMIER Common Stock, BANC ONE
Common Stock or the common stock of the surviving corporation to any
person under the PREMIER Rights Plan or enabling or allowing any right
associated with the PREMIER Rights Plan to be exercised, distributed
or triggered.
It is a condition to BANC ONE's and PAC's obligations to consummate the
Merger that per share earnings reported by PREMIER average $0.45 per quarter
from and including the second calendar quarter of 1995 through the calendar
quarter ended immediately prior to the Effective Time (or if the Effective
Time occurs within 20 days following the close of a calendar quarter, then the
next preceding calendar quarter). To determine if this earnings test is met,
PREMIER's reported earnings per share are adjusted to add back, net of any
related income tax, investment banking expenses and outside legal and
accounting fees and expenses associated with the Merger and losses on sales of
assets outside the ordinary course of business and to deduct, net of any
related income tax, any gains on sales of assets outside the ordinary course
of business. Earnings per share reported by PREMIER for the quarter ended June
30, 1995 were $0.57, and no deductions were required pursuant to the earnings
test.
It is a condition to PREMIER's obligation to consummate the Merger that per
share earnings reported by BANC ONE average $0.693 per quarter from and
including the second calendar quarter of 1995 through the calendar quarter
ended immediately prior to the Effective Time (or if the Effective Time occurs
within 20 days following the close of a calendar quarter, then the next
preceding calendar quarter). To determine if this earnings test is met, BANC
ONE's reported earnings per share are adjusted to eliminate the effect of any
changes in accounting principles required to be adopted by BANC ONE by any
regulatory authority or under generally accepted accounting principles.
Earnings per share reported by BANC ONE for the quarter ended June 30, 1995
were $0.77, and no adjustments were required pursuant to the earnings test.
On June 7, 1995 PREMIER entered into an acquisition agreement with HNB
Corporation and its subsidiary Homer National Bank of Claiborne Parish
providing for their acquisition by PREMIER for a purchase price consisting of
PREMIER Common Stock and cash. The acquisition agreement terminates if the
acquisition is not consummated by December 31, 1995. It is a condition to BANC
ONE's obligation to consummate the Merger that PREMIER have consummated its
acquisition of HNB Corporation or that PREMIER's agreement to purchase HNB
Corporation have terminated.
Any of the provisions of the Merger Agreement, including the foregoing
conditions, may be waived at any time by the party which is, or the
shareholders of which are, entitled to the benefits thereof. The Merger
Agreement may be amended or modified in whole or in part by a duly authorized
written agreement of all the parties. However, after the shareholders of
PREMIER have approved the Merger Agreement, PREMIER may only amend or modify
the Merger Agreement if, in the opinion of PREMIER's Board of Directors, such
amendment or modification will not have any material adverse effect on the
benefits intended under the Merger Agreement for the shareholders of PREMIER,
will not violate Section 112H(2) of the Louisiana Law and will not require
resolicitation of any proxies from such shareholders.
The Merger Agreement may be terminated at any time prior to the Effective
Time of the Merger, whether before or after approval by the shareholders of
PREMIER, by written notice from BANC ONE to PREMIER, or from PREMIER to BANC
ONE, as the case may be, upon the occurrence of any of the following: (i) if
any material condition to either party's obligations under the Merger
Agreement is not substantially satisfied or waived at the time or times
contemplated thereby (each party's right to terminate under this clause (i)
relates only to conditions to that party's obligations); (ii) in the event of
a material breach by a party of any representation, warranty, condition or
agreement contained in the Merger Agreement that is not cured within 30 days
of the time that written notice of such breach is received by such party from
the other party; or (iii) if the
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Merger shall not have been consummated on or before July 1, 1996. The Merger
Agreement also may be terminated, and the Merger thereby abandoned (whether
before or after approval of the merger by the shareholder of PAC or by
PREMIER's shareholders), by the mutual written consent of the Boards of
Directors of PREMIER, BANC ONE and PAC at any time prior to the Effective Time
of the Merger.
If the Merger Agreement is terminated otherwise than by a willful breach of
any party to the Merger Agreement, PREMIER, BANC ONE and PAC will each pay all
of its own expenses incurred incident to such transaction, except for printing
expenses and expenses associated with obtaining the tax opinion referred to
under the caption "MERGER--Federal Income Tax Consequences," which will be
paid by BANC ONE.
If for any reason the Merger Agreement is terminated or the Merger does not,
pursuant to the Merger Agreement, become effective, the existing agreements
with BANC ONE shall remain in full force and effect without modification or
amendment and the parties thereto shall have the rights and obligations set
forth therein. See " MERGER--Background of the Merger; Existing Agreements
with BANC ONE."
FEDERAL INCOME TAX CONSEQUENCES
The following is a summary of certain material United States Federal income
tax consequences of the Merger, including certain consequences to holders of
PREMIER Common Stock who are citizens or residents of the United States and
who hold their shares as capital assets. It does not discuss all tax
consequences that may be relevant to PREMIER shareholders subject to special
Federal income tax treatment (such as insurance companies, dealers in
securities, certain retirement plans, financial institutions, tax exempt
organizations or foreign persons) or to PREMIER shareholders who acquired
their shares of PREMIER Common Stock pursuant to the exercise of employee
stock options or otherwise as compensation. The summary does not address the
state, local or foreign tax consequences of the Merger, if any.
Pursuant to the terms of the Merger Agreement, PREMIER and BANC ONE have
received the opinion of Coopers & Lybrand L.L.P. to the effect that, based
upon the Internal Revenue Code of 1986, as amended (the "Internal Revenue
Code"), the regulations thereunder and rulings issued by the Internal Revenue
Service in transactions similar to those contemplated by the Merger Agreement
and assuming the Merger occurs in accordance with the Merger Agreement and
conditioned on the accuracy of certain representations made by PREMIER, PAC
and BANC ONE, for Federal income tax purposes:
(1) The Merger will constitute a reorganization within the meaning of
Section 368(a)(1)(A) and Section 368(a)(2)(D) of the Internal Revenue
Code;
(2) No gain or loss will be recognized by PREMIER, PAC or BANC ONE as a
consequence of the transactions contemplated by the Merger Agreement;
(3) No gain or loss will be recognized to the shareholders of PREMIER on
the exchange of their shares of PREMIER Common Stock for shares of BANC
ONE Common Stock, except as described below with respect to cash
received for fractional share interests to which they may be entitled
or pursuant to the exercise of statutory dissenters' rights;
(4) The Federal income tax basis of the BANC ONE Common Stock to be
received by holders of PREMIER Common Stock for their shares of PREMIER
Common Stock will be the same as the Federal income tax basis of the
PREMIER Common Stock surrendered in exchange therefor (reduced by any
amount allocated to fractional share interests for which cash is
received); and
(5) The holding period of the BANC ONE Common Stock received by a holder of
PREMIER Common Stock will include the period during which the PREMIER
Common Stock exchanged therefor was held, provided the exchanged
PREMIER Common Stock was held as a capital asset by such holder on the
date of the exchange.
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A PREMIER shareholder who receives cash in lieu of a fractional share
interest in BANC ONE Common Stock will be treated as having received the cash
in redemption of the fractional share interest. The receipt of cash in lieu of
a fractional share interest should generally result in capital gain or loss to
the holder equal to the difference between the amount of cash received and the
portion of the holder's Federal income tax basis in the PREMIER Common Stock
allocable to the fractional share interest. Such capital gain or loss will be
long-term capital gain or loss if the holder's holding period for the BANC ONE
Common Stock received, determined as set forth above, is longer than one year.
A dissenting shareholder who receives cash in exchange for shares of PREMIER
Common Stock will be treated as having received the cash as a distribution in
redemption of such shareholder's PREMIER Common Stock and will recognize
capital gain or loss equal to the difference between the amount of cash
received and the holder's Federal income tax basis in the shares. Such capital
gain or loss will be long-term capital gain or loss if the holder has held the
shares for more than one year as of the Effective Time.
THE INCOME TAX DISCUSSION SET FORTH ABOVE IS INCLUDED FOR GENERAL
INFORMATION ONLY AND IS BASED ON THE INTERNAL REVENUE CODE (AND AUTHORITIES
THEREUNDER) AS IN EFFECT ON THE DATE OF THIS PROSPECTUS AND PROXY STATEMENT,
WITHOUT CONSIDERATION OF THE PARTICULAR FACTS OR CIRCUMSTANCES OF ANY
SHAREHOLDER. SHAREHOLDERS ARE URGED TO CONSULT WITH THEIR OWN TAX ADVISORS
WITH RESPECT TO THE FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER IN THEIR
PARTICULAR SITUATIONS, AS WELL AS CONSEQUENCES UNDER ANY APPLICABLE STATE,
LOCAL OR FOREIGN TAX LAWS.
CONVERSION OF SHARES AND EXCHANGE OF CERTIFICATES
Upon consummation of the Merger, the outstanding shares of PREMIER Common
Stock (together with any and all Rights issued pursuant to the PREMIER Rights
Plan) will be converted into shares of BANC ONE Common Stock at the Exchange
Rate. Except in the event that PREMIER or BANC ONE shall declare a stock
dividend or distribution upon or subdivide, split up, reclassify or combine
their respective Common Stock or declare a dividend, or make a distribution,
on their respective Common Stock in any security convertible into such Common
Stock prior to the time the Merger becomes effective, no further adjustments
will be made in the Exchange Rate. However, in the event of such a
transaction, appropriate adjustment will be made in the Exchange Rate.
As soon as practicable after the Merger becomes effective, instructions and
forms will be furnished to the shareholders of PREMIER for use in exchanging
their certificates representing shares of PREMIER Common Stock and Rights
issued pursuant to the PREMIER Rights Plan for certificates of BANC ONE Common
Stock. If any certificate for shares of BANC ONE Common Stock is to be issued
in a name other than that in which the certificate for shares of PREMIER
Common Stock surrendered for exchange is registered, the certificate so
surrendered must be properly endorsed or otherwise be in proper form for
transfer and the person requesting such exchange must pay to BANC ONE or its
transfer agent any applicable transfer or other taxes required by reason of
the issuance of the certificate.
Until so surrendered, certificates formerly representing shares of PREMIER
Common Stock and Rights issued pursuant to the PREMIER Rights Plan will be
deemed for all purposes to evidence ownership of the number of shares of BANC
ONE Common Stock into which such shares have been converted. Dividends and
other distributions, if any, that become payable on BANC ONE Common Stock
pending exchange of certificates representing shares of PREMIER Common Stock
and Rights issued pursuant to the PREMIER Rights Plan will be retained by BANC
ONE until surrender of such certificates, at which time such dividends and
distributions will be paid, without interest. In addition, after the Effective
Time the holders of certificates formerly representing shares of PREMIER
Common Stock and Rights issued pursuant to the PREMIER Rights Plan shall cease
to have rights with respect to such shares and to any related Rights (except
such rights, if any, as holders of certificates representing PREMIER Common
Stock may have as dissenting shareholders), and, except as
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aforesaid, their sole right shall be to exchange such certificates for shares
of BANC ONE Common Stock and any fractional share payment in accordance with
the Merger Agreement.
FRACTIONAL SHARES
No fractional shares of BANC ONE Common Stock will be exchanged for shares
of PREMIER Common Stock. In lieu thereof, each shareholder of PREMIER having a
fractional interest resulting from the exchange of PREMIER Common Stock for
BANC ONE Common Stock will be paid by BANC ONE an amount in cash equal to the
value of such fractional interest based upon the average of the closing prices
of BANC ONE Common Stock on the NYSE during the Valuation Period (as defined
below) as reported in The Wall Street Journal for NYSE Composite Transactions.
As used herein, "Valuation Period" means the ten consecutive NYSE trading days
ending on the eighth NYSE trading day immediately prior to the Closing Date.
INTERESTS OF CERTAIN PERSONS IN THE MERGER
Certain members of PREMIER's management and certain members of the PREMIER
Board of Directors may be deemed to have interests in the Merger in addition
to their interests, if any, as shareholders of PREMIER generally.
Severance Agreements. There are currently in effect contracts between
PREMIER and 14 of its officers, including G. Lee Griffin, F. Walker Lockett,
Jr., R. Neil Williams, H. Brooks McElveen and Michael O Bertolet, providing
for certain benefits in the event of any "change in control" of PREMIER or
Premier Bank, as defined in the contracts. Consummation of the Merger will
constitute a "change in control" for purposes of the severance contracts. The
contracts require payment of a severance benefit equivalent to up to three
times, and in the case of Mr. Lockett up to five times, the officer's salary
and bonus earned in the year prior to the change in control if the officer's
employment is terminated without cause, as defined in the contract, or is
terminated by the officer for certain specified reasons, within the four-year
period (or in the case of the contract with Mr. Lockett, at any time)
following the change in control. The officer may also be entitled to receive,
after the date of such termination, benefits under PREMIER's life insurance,
health insurance and pension plans in which he participated prior to the
change in control or the value thereof payable in a lump sum. With the
exception of Mr. Lockett, the benefits payable to any person may not exceed
the amount allowable to PREMIER as a deduction for federal tax purposes under
applicable law. The difference in terms in Mr. Lockett's contract arose out of
commitments to Mr. Lockett made at the time of his employment in 1987.
Assuming the Merger were consummated by December 31, 1995 and assuming that
Messrs. Griffin, Lockett, Williams, McElveen and Bertolet were terminated
without cause or terminated their employment for certain reasons specified in
the contracts at the Effective Time, Messrs. Griffin, Lockett, Williams,
McElveen and Bertolet would be entitled to severance benefit payments under
the severance contracts of approximately $1,424,000, $2,471,000, $827,000,
$745,000 and $734,000, respectively.
Indemnification and Insurance. The Merger Agreement provides that BANC ONE
shall insure that all rights to indemnification and defense and all
limitations of liability existing in favor of any person who was or is, or who
becomes prior to the Effective Time, a director, officer, employee, fiduciary
or agent of PREMIER or any of its subsidiaries (an "Indemnified Party"), as
provided in PREMIER's Articles and Bylaws and similar governing documents of
any of its subsidiaries, as in effect as of February 20, 1991, or as otherwise
provided for or allowed by applicable law as in effect as of July 19, 1995 or
as such law is amended prior to the Effective Time, with respect to claims or
liabilities arising from facts or events existing or occurring prior to the
Effective Time, shall survive the Merger and shall continue in full force and
effect for a period of ten years from the Effective Time.
The Merger Agreement further provides that, in the event of any threatened
or actual claim, action, suit, proceeding or investigation based in whole or
in part on, or arising in whole or in part out of, or pertaining to, the
Merger Agreement or any of the transactions contemplated thereby, BANC ONE
will, subject to the
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conditions set forth in the Merger Agreement, indemnify any Indemnified Party
against any and all losses, claims, damages, liabilities, costs, expenses
(including attorneys' fees and expenses), judgments and fines, and amounts
paid in settlement, in connection with any such threatened or actual claim,
action, suit, proceeding or investigation.
PREMIER and Premier Bank have provided indemnification contracts to their
directors and executive officers, as well as certain advisory directors and
officers of Premier Bank, pursuant to which PREMIER or Premier Bank would
indemnify each such person to the full extent permitted by law in connection
with pending or threatened actions against such person or in which such person
is involved as a witness, if such actions are based on the fact that such
person is or was a director or officer of PREMIER or Premier Bank or any of
their subsidiaries, a fiduciary with respect to any employee benefit plan of
PREMIER or Premier Bank or a director, officer, employee or agent of another
entity if such position was held at the request of PREMIER or Premier Bank.
PREMIER and its subsidiaries maintain in effect policies providing insurance
coverage for their directors and officers. Pursuant to the Merger Agreement,
PREMIER and its subsidiaries may not renew or obtain any new such insurance
for any period after the Effective Time for events occurring before or after
the Effective Time; provided, however, that PREMIER may (i) renew, extend or
replace existing policies in the ordinary course consistent with past
practices for periods of not greater than one year and (ii) acquire a policy
which provides coverage through December 31, 1997 for those directors,
officers and/or employees of PREMIER and/or its subsidiaries who are presently
provided coverage by policies obtained by PREMIER with respect to (x) events
related to the Merger Agreement and the events contemplated thereby and (y)
claims and/or causes of action arising from or related to events which
occurred prior to the Closing Date.
RESALES BY AFFILIATES
The shares of BANC ONE Common Stock issuable to PREMIER shareholders upon
consummation of the Merger have been registered under the Securities Act, but
such registration does not cover resales by any person who, directly or
indirectly, controls, or is controlled by, or is under common control with
PREMIER at the time the Merger Agreement is submitted for approval by a vote
of the PREMIER shareholders ("Affiliates"). BANC ONE Common Stock received and
beneficially owned by those PREMIER shareholders who are deemed to be
Affiliates may be resold without registration as provided for by Rule 145
under the Securities Act, or as otherwise permitted. Each Affiliate who
desires to resell the BANC ONE Common Stock received in the Merger must sell
such BANC ONE Common Stock either (i) pursuant to an effective registration
statement under the Securities Act, (ii) in accordance with the applicable
provisions of Rule 145 under the Securities Act or (iii) in a transaction
which, in the opinion of counsel for such Affiliate or as described in a "no-
action" or interpretive letter from the Staff of the Commission, in each case
reasonably satisfactory in form and substance to BANC ONE, is exempt from the
registration requirements of the Securities Act.
Rule 145(d) requires that persons deemed to be Affiliates resell their BANC
ONE Common Stock pursuant to certain of the requirements of Rule 144 under the
Securities Act if such BANC ONE Common Stock is sold within the first two
years after the receipt thereof. After two years, if such person is not an
affiliate of BANC ONE and BANC ONE is current in the filing of its periodic
securities law reports, a former Affiliate of PREMIER may freely resell the
BANC ONE Common Stock received in the Merger without limitation. After three
years from the issuance of the BANC ONE Common Stock, if such person is not an
affiliate of BANC ONE at the time of sale or for at least three months prior
to such sale, such person may freely resell such BANC ONE Common Stock,
without limitation, regardless of the status of BANC ONE's periodic securities
law reports.
PREMIER has agreed to use reasonable best efforts to cause each person who
is at the Effective Time or was, at the time of the Special Meeting, an
Affiliate to execute and deliver to BANC ONE a written undertaking to the
effect that no sale will be made of any shares of BANC ONE Common Stock
received in the Merger by such Affiliate except in accordance with the
Securities Act. The certificates of BANC ONE Common Stock
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issued to Affiliates of PREMIER in the Merger may contain an appropriate
restrictive legend, and appropriate stop transfer orders may be given to the
transfer agent for such certificates.
ACCOUNTING TREATMENT
BANC ONE expects to account for the acquisition of PREMIER as a purchase
under generally accepted accounting principles. Accordingly, all of the assets
and liabilities of PREMIER would be recorded in BANC ONE's consolidated
financial statements at their fair value at the Effective Time, and the
amount, if any, by which the purchase price paid by BANC ONE exceeds the fair
value of the assets acquired by BANC ONE through the Merger would be recorded
as goodwill. BANC ONE's consolidated financial statements would include the
operations of PREMIER after the Effective Time.
COMPARATIVE RIGHTS OF SHAREHOLDERS
DESCRIPTION OF BANC ONE STOCK
General. The authorized capital stock of BANC ONE consists of 600,000,000
shares of BANC ONE Common Stock and 35,000,000 shares of Preferred Stock,
without par value ("Preferred Stock"), divided into 10,000,000 shares of Class
A Preferred Stock, 1,000,000 shares of Class B Convertible Preferred Stock
("Class B Preferred Stock") and 24,000,000 shares of Class C Preferred Stock
of which the Series C $3.50 Cumulative Convertible Preferred Stock, consisting
of 5,000,000 authorized shares, has been designated ("Class C Preferred
Stock"). As of June 30, 1995, there were issued and outstanding 4,997,499
shares of Class C Preferred Stock and there were issued 410,290,638 shares of
BANC ONE Common Stock (including 18,000,000 shares of treasury stock).
The following summary of the terms of BANC ONE's capital stock does not
purport to be complete and is qualified in its entirety by reference to the
applicable provisions of Ohio Law and BANC ONE's Articles.
Common Stock. Holders of BANC ONE Common Stock are entitled to receive
dividends out of funds legally available therefor as and if declared by the
BANC ONE Board of Directors, provided that, so long as any shares of Preferred
Stock are outstanding, no dividends (other than dividends payable in BANC ONE
Common Stock) or other distributions (including redemptions and purchases) may
be made with respect to the BANC ONE Common Stock unless full cumulative
dividends on the shares of Preferred Stock have been paid.
Holders of shares of BANC ONE Common Stock are entitled to one vote for each
share for the election of directors and on all other matters. Holders of BANC
ONE Common Stock vote together as a class with holders of Class A Preferred
Stock and Class B Preferred Stock. Generally, holders of Class C Preferred
Stock have no voting rights.
The issued and outstanding shares of BANC ONE Common Stock are fully paid
and nonassessable. The holders of BANC ONE Common Stock are not entitled to
preemptive rights or conversion or redemption rights. The holders of BANC ONE
Common Stock do not have cumulative voting rights in the election of
directors.
In the event of the voluntary or involuntary dissolution, liquidation or
winding up of BANC ONE, holders of BANC ONE Common Stock will be entitled to
receive, pro rata, after satisfaction in full of the prior rights of creditors
(including holders of BANC ONE's indebtedness) and holders of Preferred Stock,
all the remaining assets of BANC ONE available for distribution.
Preferred Stock. BANC ONE's Board of Directors has the authority to issue
shares of Class A and Class C Preferred Stock in one or more series and to fix
the designations, number of shares, dividends, redemption rights, sinking fund
requirements, liquidation prices, conversion rights and other rights,
qualifications, limitations or restrictions thereon (except voting rights) as
the BANC ONE Board of Directors may from time to time be permitted by law to
fix or change.
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Currently, no shares of Preferred Stock except shares of Class C Preferred
Stock are outstanding. Holders of Class C Preferred Stock are entitled to
receive out of funds legally available therefor cumulative cash dividends at
the annual rate of $3.50 per share payable quarterly on the last day of March,
June, September and December in each year. If full cumulative dividends on
outstanding shares of Class C Preferred Stock have not been paid, no dividends
may be declared or paid on, and no amounts may be set aside or applied to the
redemption or purchase of, any shares of BANC ONE Common Stock or any other
shares of capital stock of BANC ONE ranking junior to shares of Class C
Preferred Stock. Upon the voluntary or involuntary dissolution, liquidation or
winding up of BANC ONE, holders of Class C Preferred Stock are entitled to
receive a preferential distribution of $50 per share plus accrued and unpaid
dividends, if any. The Class C Preferred Stock ranks on a parity as to payment
of dividends and with respect to distributions upon liquidation with the Class
B Preferred Stock.
Generally, holders of shares of Class C Preferred Stock have no voting
rights. However, the approval of a majority of the outstanding shares of Class
C Preferred Stock voting together as a class is required in order to amend
BANC ONE's Articles to affect adversely the rights of the holders of the Class
C Preferred Stock or to take any action that would result in the creation of
or an increase in the number of authorized shares senior or superior with
respect to dividends or upon liquidation to the Class C Preferred Stock.
Holders of Class C Preferred Stock also have the right to elect two additional
directors during any period in which dividends on Class C Preferred Stock are
cumulatively in arrears in the amount of six or more full quarterly dividends.
At the option of the holder of any shares of Class C Preferred Stock, such
shares may be converted into shares of BANC ONE Common Stock at the conversion
rate then in effect. The present conversion rate is 1.75362 shares of BANC ONE
Common Stock for each share of Class C Preferred Stock and is subject to
adjustment for stock dividends, subdivisions, splits and combinations and for
any distribution of rights or warrants to purchase BANC ONE Common Stock at a
price per share less than the BANC ONE Common Stock's then-current market
value.
The issued shares of Class C Preferred Stock may be redeemed, in whole or in
part, by BANC ONE at its election at any time after April 15, 1995, at a
redemption price of $52.10 per share during the period from April 15, 1995, to
but not including March 31, 1996, and thereafter at the redemption prices
during the 12-month periods beginning on March 31 of the years shown below,
plus accrued and unpaid dividends, if any.
<TABLE>
<CAPTION>
YEAR REDEMPTION PRICE
---- ----------------
<S> <C>
1996..................................................... $51.75
1997..................................................... $51.40
1998..................................................... $51.05
1999..................................................... $50.70
2000..................................................... $50.35
2001 and thereafter...................................... $50.00
</TABLE>
The Class C Preferred Stock is not subject to the operation of a sinking
fund.
Special Voting Requirements for Certain Transactions. Under Ohio Law, a
merger or consolidation by an Ohio corporation generally requires the
affirmative vote of shares representing at least two-thirds of the shareholder
voting power of the corporation, unless the corporation's articles of
incorporation provide for approval by a different proportion not less than a
majority. BANC ONE's Articles generally require only approval of a majority of
the outstanding shares for such transactions.
Article Eleventh of BANC ONE's Articles incorporates, to a large extent, the
provisions of the Ohio control share acquisition statute (the "Ohio Control
Share Statute"), as set forth in Section 1701.831 of the Ohio Revised Code.
Article Eleventh sets forth procedures for obtaining shareholder consent of
"control share acquisitions" subject to the right of the Board of Directors to
screen out proposals that do not meet certain standards set forth in Article
Eleventh. Article Eleventh defines a "control share acquisition" as any
acquisition,
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directly or indirectly, of shares of BANC ONE which, when added to all other
shares of BANC ONE owned or controlled by the acquiror, would entitle the
acquiror, alone or with others, to exercise or direct the exercise of voting
power in BANC ONE in the election of directors within any of the following
ranges of voting power: (i) one-fifth or more but less than one-third; (ii)
one-third or more but less than a majority; and (iii) a majority or more. A
bank, broker, nominee, trustee or other person who acquires shares in the
ordinary course of business for the benefit of others in good faith and not
for the purpose of circumventing Article Eleventh shall be deemed to have
voting power only of shares in respect of which such person would be able to
exercise or direct the exercise of votes without further instruction from
others at a meeting of shareholders called under Article Eleventh. A control
share acquisition which meets certain criteria set forth in Article Eleventh
as determined by the Board of Directors must be presented to a meeting of the
shareholders of BANC ONE and approved by the affirmative vote of both (a) a
majority of the voting power represented at the meeting and (b) a majority of
that portion of such voting power excluding any "interested shares"; that is,
those shares held by the acquiring person, executive officers of BANC ONE and
employees of BANC ONE who are also directors. Article Eleventh may be amended
by a vote of 85% of the votes entitled to be cast by all holders of voting
stock.
BANC ONE's Articles also include a "fair price" provision that is designed
to provide reasonable assurances to shareholders that in the event any
shareholder or group of shareholders acquires 20% or more of BANC ONE's voting
stock (the "Acquiror") and then seeks to acquire all or part of the remaining
voting stock through a merger or other transaction which would force a change
or termination of the other shareholders' ownership interests (a "Business
Combination"), such other shareholders must receive consideration at least
equivalent to the highest price paid by the Acquiror in acquiring its 20%
stock interest, unless the Business Combination is approved either (i) by a
majority of directors who are unrelated to the Acquiror or (ii) by the
affirmative vote of 75% of all the votes entitled to be cast by all holders of
voting stock and 67% of the votes entitled to be cast by all holders of voting
stock held by shareholders other than the Acquiror ("Special Shareholder
Vote").
This provision operates by requiring that after an Acquiror emerges, any
Business Combination which has the effect of requiring shareholders to
surrender their shares must satisfy one of the following conditions:
(i) Fair Consideration to Shareholders. The terms of the Business
Combination must provide for payment of consideration which is at least
equivalent to the highest price paid to other shareholders by the
Acquiror in acquiring its 20% stock position and must be approved by
shareholders as otherwise required by applicable law; or
(ii) Unrelated Director Approval. The Business Combination must be approved
as fair to shareholders by a majority of the directors who are not
affiliated with the Acquiror and who were directors before the
Acquiror acquired its 20% stock position or who were nominated or
elected to succeed such directors by the other unaffiliated directors
("Unrelated Directors") and must be approved by shareholders as
otherwise required by applicable law; or
(iii) Special Shareholder Vote. The Business Combination must be approved
by a Special Shareholder Vote.
Article Tenth of BANC ONE's Articles, which contains this provision, may be
amended only by a vote of 85% of the votes entitled to be cast by all holders
of voting stock, unless the amendment is approved unanimously by the Unrelated
Directors, in which case only majority shareholder approval would be required.
Chapter 1704 of the Ohio Revised Code (the "Ohio Statute") is similar to the
"fair price" provision contained in BANC ONE's Articles. The Ohio Statute
prohibits an "Issuing Public Corporation" from engaging in a "Chapter 1704
Transaction" with an "Interested Shareholder" for a period of three years
following the date on which the person becomes an Interested Shareholder
unless, prior to such date, the directors of the Issuing Public Corporation
approve either the Chapter 1704 Transaction or the acquisition of shares
pursuant to which such person became an Interested Shareholder. After the
initial three-year moratorium has expired, an Issuing Public Corporation may
engage in a Chapter 1704 Transaction if (i) the acquisition of shares pursuant
to
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which the person became an Interested Shareholder received the prior approval
of the board of directors of the Issuing Public Corporation, (ii) the Chapter
1704 Transaction is approved by the affirmative vote of the holders of shares
representing at least two-thirds of the voting power of the Issuing Public
Corporation and by the holders of at least a majority of voting shares which
are not beneficially owned by an Interested Shareholder or an affiliate or
associate of an Interested Shareholder or (iii) the Chapter 1704 Transaction
meets certain statutory tests designed to ensure that it be economically fair
to all shareholders.
For this purpose, an "Issuing Public Corporation" is any Ohio corporation
with 50 or more shareholders that has its principal place of business,
principal executive offices or substantial assets within the State of Ohio.
BANC ONE currently is an Issuing Public Corporation. An "Interested
Shareholder" is any person who is the beneficial owner of a sufficient number
of shares to allow such person, directly or indirectly, alone or with others,
including affiliates and associates, to exercise or direct the exercise of 10%
of the voting power of the Issuing Public Corporation. A "Chapter 1704
Transaction" includes any merger, consolidation, combination or majority share
acquisition between or involving an Issuing Public Corporation and an
Interested Shareholder or an affiliate or associate of an Interested
Shareholder. A Chapter 1704 Transaction also includes certain transfers of
property, dividends and issuance or transfers of shares, from or by an Issuing
Public Corporation or a subsidiary of an Issuing Public Corporation to, with
or for the benefit of an Interested Shareholder or an affiliate or associate
of an Interested Shareholder unless such transaction is in the ordinary course
of business of the Issuing Public Corporation on terms no more favorable to
the Interested Shareholder than those acceptable to third parties as
demonstrated by contemporaneous transactions. Finally, Chapter 1704
Transactions include certain transactions which (i) increase the proportionate
share ownership of an Interested Shareholder, (ii) result in the adoption of a
plan or proposal for the dissolution, winding up of the affairs or liquidation
of the Issuing Public Corporation if such plan is proposed by or on behalf of
the Interested Shareholder or (iii) pledge or extend the credit or financial
resources of the Issuing Public Corporation to or for the benefit of the
Interested Shareholder.
COMPARISON OF BANC ONE COMMON STOCK AND PREMIER COMMON STOCK
The rights of BANC ONE shareholders are governed by BANC ONE's Articles and
Code of Regulations and the applicable provisions of Ohio Law, while the
rights of PREMIER shareholders are governed by PREMIER's Articles of
Incorporation ("PREMIER's Articles") and Bylaws and the applicable provisions
of Louisiana Law. If the shareholders of PREMIER approve the Merger Agreement
and the Merger is subsequently consummated, holders of PREMIER Common Stock
will become holders of BANC ONE Common Stock. The following comparison of the
rights of holders of BANC ONE Common Stock and PREMIER Common Stock is based
on current terms of the governing documents of the respective companies and on
the current provisions of applicable state law.
The rights of holders of PREMIER Common Stock and holders of BANC ONE Common
Stock are similar in several respects: each shareholder is entitled to one
vote for each share held on all matters submitted to a vote of shareholders
and neither is entitled to cumulative voting rights in connection with the
election of directors, each shareholder is entitled to receive pro rata any
assets distributed to shareholders upon liquidation, dissolution or winding up
of the affairs of the company (after all creditors have been satisfied and
requisite preferential amounts are paid to the holders of outstanding
preferred stock), and shareholders are not entitled to preemptive rights to
subscribe for or purchase any stock or other securities in proportion to their
respective holdings upon the offering or sale by BANC ONE or PREMIER of such
securities to others. Although it is impracticable to note all the differences
between Ohio Law and Louisiana Law generally and all of the differences
between the applicable governing documents of BANC ONE and PREMIER, the
following is intended to be a summary of certain significant differences
between the rights of holders of BANC ONE Common Stock and the rights of
holders of PREMIER Common Stock.
Dividends. Under Ohio Law, dividends may be paid out of surplus, including
both earned surplus and capital surplus, in cash, property or shares of the
corporation, provided that such dividend payments are not in violation of the
rights of any other class of securities and are not made when the corporation
is insolvent or there is reasonable ground to believe that by such payment it
will be rendered insolvent. Louisiana Law with respect
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to the payment of dividends is substantially the same, except that a Louisiana
corporation is permitted to pay dividends, notwithstanding the absence of
surplus, out of its net profits for the then current year, the preceding
fiscal year or both, unless at the time, or as a result of such dividends,
liabilities exceed assets or the net assets are less than the amount payable
upon liquidation to any class of securities with a preferential right to
participate in assets in the event of liquidation. The payment of dividends by
bank holding companies also is subject to certain regulatory constraints.
Dissenters' Rights. Under Ohio Law, the shareholders of an Ohio corporation
that is being merged into a surviving or new corporation, and the shareholders
of an Ohio corporation that is the surviving corporation of a merger on which
such shareholders are entitled to vote, have the right to dissent from the
merger and, if certain procedural requirements are satisfied, to receive, in
lieu of the merger consideration, a payment equal to the fair cash value of
such shareholders' shares as of the day preceding the shareholder vote.
Shareholders of an Ohio Corporation are also entitled to exercise dissenters'
rights in connection with the lease, sale, exchange, transfer or other
disposition of all or substantially all of the assets of such corporation and
in connection with certain amendments to such corporation's articles of
incorporation. Louisiana Law with respect to dissenters' rights upon a merger
and upon the sale or other disposition of all of a corporation's assets is
substantially the same, except that dissenters' rights are not available if
either (i) the shares entitled to be voted are listed on a national securities
exchange or designated as a national market system security on an inter-dealer
quotation system by the National Association of Securities Dealers (unless the
articles of incorporation of the corporation provide otherwise) and such
shares are converted by the merger solely into shares of the surviving or new
corporation or (ii) the transaction is approved by at least 80% of the total
voting power entitled to vote thereon. Louisiana Law does not provide for
dissenters' rights in connection with amendments to a Louisiana corporation's
articles of incorporation. See "VOTING AND MANAGEMENT INFORMATION--Rights of
Dissenting Shareholders."
Directors. PREMIER's Board of Directors is divided into three classes, as
nearly equal in number as possible, with members of each class elected to
serve for three years, and with one class being elected each year. BANC ONE
does not have a classified board, with the result that directors serve for one
year terms and the entire BANC ONE Board of Directors is elected annually. To
qualify for election to BANC ONE's Board of Directors, an individual must own
a substantial number of shares of BANC ONE's capital stock, and must not also
serve as a director or officer of or in any other management relationship for
any financial institution that is in competition with BANC ONE or any of its
subsidiaries. Neither Louisiana Law nor PREMIER's governing documents impose
any similar requirements on PREMIER directors.
Any PREMIER director may be removed from office without cause only by the
affirmative vote of at least 80% of the total voting power of PREMIER.
Directors of BANC ONE may be removed, with or without cause, by the
affirmative vote of a majority of the voting power present at a meeting of
BANC ONE shareholders.
Supermajority and Fair Price Provisions. PREMIER's Articles do not contain a
provision similar to the provision of BANC ONE's Articles relating to control
share acquisitions. However, Louisiana Law contains a control share
acquisition statute similar to that under Ohio Law which is substantially
replicated in BANC ONE's Articles. See "COMPARATIVE RIGHTS OF SHAREHOLDERS--
Description of BANC ONE Stock--Special Voting Requirements for Certain
Transactions." A merger under either Ohio Law or Louisiana Law pursuant to an
agreement to which the corporation being acquired is a party, such as the
Merger, is not subject to the control share acquisition provision included in
BANC ONE's Articles or to the Ohio or Louisiana control share acquisition
statutes.
Like BANC ONE's Articles, PREMIER's Articles contain supermajority vote and
fair price provisions for business combinations. However, PREMIER's provisions
are triggered if any shareholder or group of shareholders acquires 10% or more
of PREMIER's outstanding capital stock (a "Related Person") entitled to vote
on certain business combinations, rather than 20% in the case of BANC ONE, and
the supermajority vote that may be required to approve the business
combination or amend the provisions is 80% of the total voting power of
PREMIER, rather than, in the case of BANC ONE, both (i) 75% of the total
voting power voting as a class and (ii) 67% of the total voting power other
than voting power held by the Related Person. See "--Amendment of Governing
Documents." Louisiana Law imposes a fair price requirement that is similar to
the fair price provisions contained in PREMIER's Articles.
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In addition to being subject to the laws of Louisiana and Ohio,
respectively, PREMIER and BANC ONE, as bank holding companies, are subject to
various provisions of federal law with respect to mergers, consolidations and
certain other corporate transactions.
Evaluation of Tender Offers and Business Combinations. PREMIER's Articles
require the PREMIER Board of Directors, when evaluating a tender offer or an
offer to make a tender offer or exchange offer or to effect a business
combination, to consider certain enumerated factors in exercising its judgment
in determining what is in the best interest of PREMIER and its shareholders.
For this purpose, the PREMIER Board of Directors must consider, among other
things, not only the consideration being offered in relation to the then
current market price of PREMIER's outstanding capital stock, but also the
market price for PREMIER's outstanding capital stock over a period of years,
the estimated price that might be achieved in a negotiated sale of PREMIER as
a whole or in part or through orderly liquidation, the premiums over market
price for the securities of other corporations in similar transactions,
current political, economic and other factors bearing on securities prices and
PREMIER's financial condition and future prospects. The PREMIER Board of
Directors is also required to evaluate the business, financial condition and
earnings prospects of the acquiring party or parties, and the possible effect
of such conditions upon PREMIER and its subsidiaries and the communities in
which PREMIER and its subsidiaries do business, and the competence, experience
and integrity of the acquiring party or parties and its or their management.
Finally, the PREMIER Board of Directors must consider the social and economic
effects of the transaction on PREMIER and its subsidiaries, employees,
depositors, loan and other customers, creditors and the communities in which
PREMIER and its subsidiaries do business. Louisiana Law contains a provision
permitting directors of a Louisiana corporation to consider similar factors.
Ohio Law includes a provision which permits directors, in determining
whether any matter is in the best interests of the corporation, to take into
consideration the interests of the corporation's employees, suppliers,
creditors and customers, the economy of the state and the nation, community
and societal considerations and the long-term and short-term interests of the
corporation and its shareholders, including the possibility that such
interests may be best served by the continued independence of the corporation.
Amendment of Governing Documents. Generally, the affirmative vote of the
holders of 80% of the total voting power is required to amend any provision of
PREMIER's Articles unless a majority of the PREMIER Board of Directors has
recommended such amendment at a time when there is no Related Person, or a
majority of the unrelated directors has recommended such amendment at a time
when there is a Related Person, in which case the affirmative vote of the
holders of at least a majority of the voting power present at a shareholders'
meeting is required to amend PREMIER's Articles. BANC ONE's Articles may be
amended by the affirmative vote of the holders of a majority of the voting
power of BANC ONE, except that amendments to the "control share acquisition"
and "fair price" provisions require the affirmative vote of 85% of the total
voting power. See "COMPARATIVE RIGHTS OF SHAREHOLDERS--Description of BANC ONE
Capital Stock--Special Voting Requirements for Certain Transactions."
The Premier Bylaws may be amended from time to time by the affirmative vote
of two-thirds of PREMIER's entire Board of Directors and by a majority of the
unrelated directors or by the affirmative vote of the holders of 80% of the
total voting power. The Code of Regulations of BANC ONE may only be amended by
the affirmative vote of a majority of the voting power represented by the
outstanding voting stock of BANC ONE present in person or by proxy at an
annual or special meeting called for such purpose.
Rights Agreement. PREMIER has adopted a Rights Agreement pursuant to which
PREMIER has issued one Right for each outstanding share of PREMIER Common
Stock and has authorized the issuance of one Right with respect to each share
of PREMIER Common Stock issued after January 18, 1989 and before the
Distribution Date (as defined below). Each Right entitles the registered
holder to purchase from PREMIER on or after the Distribution Date one share of
PREMIER Common Stock at a price of $18.18 per share (the "Purchase Price").
The "Distribution Date" occurs on the earlier of the close of business on the
tenth day after (i) the date of a public announcement that any person or group
of affiliated or associated persons has acquired or obtained the right to
acquire beneficial ownership of 20% or more of the outstanding shares of
PREMIER Common Stock
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without the prior written approval of a majority of the Board of Directors (an
"Acquiring Person") or such earlier date as the PREMIER Board of Directors
becomes aware of the existence of an Acquiring Person and (ii) the date of
commencement of, or public announcement of an intention to commence, a tender
or exchange offer by any person without the approval of the PREMIER Board of
Directors, upon the consummation of which such person or group of affiliated
or associated persons would own 30% or more of the outstanding shares of
PREMIER Common Stock.
The Rights Agreement provides that if (i) any person or group becomes an
Acquiring Person (other than pursuant to an all-cash tender offer for all of
the outstanding PREMIER Common Stock which increases such Acquiring Person's
beneficial ownership to 80% or more of the outstanding shares of PREMIER
Common Stock and as to which PREMIER has received an opinion from its
investment bankers that the price offered per share is not inadequate), or
(ii) during such time as there is an Acquiring Person, there shall occur any
transaction involving PREMIER or its subsidiaries which increases by more than
1% the proportionate share of the outstanding shares of any class of equity
securities of PREMIER or any of its subsidiaries that is directly or
indirectly owned or controlled by the Acquiring Person, then proper provision
would be made so that each holder of record of a Right, other than Rights that
are or were at any time beneficially owned by an Acquiring Person, will
thereafter be entitled to receive, upon payment of the Purchase Price, that
number of shares of PREMIER Common Stock having a current market value of two
times the Purchase Price.
The Rights Agreement further provides that if, on or after the Distribution
Date, PREMIER (i) consolidates or merges with any other person and either is
not the surviving corporation or, if it is the surviving corporation, any
shares of PREMIER Common Stock are exchanged for any other property, or (ii)
sells or transfers assets or earning power aggregating more than 50% of the
assets or earning power of PREMIER and its subsidiaries, then proper provision
shall be made so that each holder of record of a Right, other than Rights that
are or were at any time beneficially owned by an Acquiring Person, will
thereafter be entitled to receive, upon payment of the Purchase Price, that
number of shares of common stock of the acquiring entity having a current
market value of two times the Purchase Price.
At any time until the earlier of the Distribution Date (subject to extension
by the PREMIER Board of Directors) and January 18, 1999, the PREMIER Board of
Directors may redeem the Rights in whole, but not in part, at a price of $.01
per Right. At any time prior to the close of business on the Distribution
Date, the PREMIER Board of Directors may accelerate the expiration of the
Rights so that all Rights that have not been exercised at the close of
business on the tenth day following the Distribution Date expire without
further action by PREMIER.
Because both the Option and the Merger were approved by the PREMIER Board of
Directors, BANC ONE is not considered an Acquiring Person under the Rights
Agreement.
BANC ONE has not implemented the same or any similar arrangement, but could
do so without further action of its shareholders.
Liability of Officers and Directors. Under both Ohio and Louisiana Law,
shareholders are entitled to bring suit, generally in an action on behalf of
the corporation, to recover damages caused by breaches of the duty of care and
the duty of loyalty owed to a corporation and its shareholders by directors
and, to a certain extent, officers. Ohio Law has codified the traditional
business judgment rule. Ohio Law provides that the business judgment
presumption of good faith may only be overcome by clear and convincing
evidence, rather than the preponderance of the evidence standard applicable in
most states. Further, Ohio Law provides specific statutory authority for
directors to consider, in addition to the interests of the corporation's
shareholders, other factors such as the interests of the corporation's
employees, suppliers, creditors and customers; the economy of the state and
nation; community and societal considerations; the long-term and short-term
interests of the corporation and its shareholders; and the possibility that
these interests may be best served by the continued independence of the
corporation.
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Louisiana Law permits corporations to include provisions in their articles
of incorporation that limit personal liability for monetary damages resulting
from breaches of the duty of care, subject to certain exceptions, and both
Ohio and Louisiana Law permits corporations to indemnify officers and
directors in certain circumstances for their expenses and liabilities incurred
in connection with defending pending or threatened suits, as more fully
described below.
Limitation of Liability. PREMIER's Articles include a provision that
eliminates the personal liability of directors and officers to PREMIER and its
shareholders for monetary damages resulting from breaches of the duty of care
to the fullest extent permitted by Louisiana Law. The provision may be amended
or repealed only upon the affirmative vote of at least 80% of the total voting
power and no amendment or repeal of this provision will adversely affect the
elimination of liability accorded to any director for acts or omissions
occurring prior to such amendment or repeal. The PREMIER Articles also
authorize its Board of Directors to enter into contracts with directors and
officers providing for this limitation of liability. See "--Indemnification
and Insurance."
Indemnification and Insurance. Under Ohio and Louisiana Law, corporations
are permitted, and in some circumstances required, to indemnify, among others,
current and prior officers, directors, employees or agents of the corporation
for expenses and liabilities incurred by such parties in connection with
defending pending or threatened suits instituted against them in their
corporate capacities, provided certain specified standards of conduct are
determined to have been met. Both Ohio and Louisiana Law further permit
corporations to grant indemnification rights more expansive than those
permitted by statute and to purchase insurance for indemnifiable parties
against any liability asserted against or incurred by such parties in their
corporate capacities. In addition, both Ohio and Louisiana Law contain express
authorization for corporations to establish trust funds, insurance
subsidiaries or other forms of self-insurance for the benefit of its officers,
directors, employees and agents.
The PREMIER Articles confirm the authority of the PREMIER's Board of
Directors to (i) adopt bylaws or resolutions providing for indemnification of
directors, officers and other persons to the fullest extent permitted by law,
(ii) enter into contracts with directors and officers providing for
indemnification to the fullest extent permitted by law and (iii) cause the
corporation to exercise its powers to procure directors' and officers'
liability insurance. The PREMIER Articles also provide that any amendment or
repeal of any bylaw or resolution relating to indemnification will not
adversely affect any person's entitlement to indemnification whose claim
results from conduct occurring prior to the date of such amendment or repeal.
These provisions may be amended or repealed only by the affirmative vote of
80% of the total voting power.
The PREMIER Bylaws expressly provide for indemnification of directors,
officers and employees to the fullest extent permitted by law against any
costs incurred in connection with any threatened, pending or completed claim,
action, suit or proceeding because of his or her service as a director,
officer or employee of PREMIER. Without a specific provision regarding
indemnification, PREMIER's Board of Directors would be permitted to indemnify
directors, officers and employees at its discretion, but would not be required
by law to do so unless such person was successful in defending a claim against
him.
The BANC ONE Code of Regulations provide that BANC ONE may indemnify
directors, officers, employees and agents to the fullest extent permitted by
law against costs incurred in connection with any threatened, pending or
completed claim, action, suit or proceeding because of such person's service
as a director, officer, employee or agent of BANC ONE.
Each of BANC ONE and PREMIER has entered into indemnification contracts with
its directors and certain of its officers that, among other things, provide
the contracting director or officer with certain procedural and substantive
rights to indemnification. Such indemnification rights apply to acts or
omissions of such persons, whether such acts or omissions occurred before or
after the effective date of the contract. See "MERGER--Interests of Certain
Persons in the Merger."
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MISCELLANEOUS INFORMATION
TRANSFER AND EXCHANGE AGENTS
Harris Trust and Savings Bank, Chicago, Illinois, serves as Transfer Agent
and as Registrar for BANC ONE Common Stock. Harris Trust and Savings Bank will
act as Exchange Agent in connection with the Merger. Premier Bank acts as
Transfer Agent and Registrar for PREMIER's Common Stock.
EXPERTS
The consolidated financial statements of BANC ONE and its subsidiaries,
included in the Annual Report on Form 10-K of BANC ONE for the fiscal year
ended December 31, 1994 have been audited by Coopers & Lybrand L.L.P.,
independent accountants, as set forth in their report dated February 21, 1995
accompanying such financial statements, and are incorporated herein by
reference in reliance upon the report of such firm, which report is given upon
their authority as experts in accounting and auditing. The report of Coopers &
Lybrand L.L.P. dated February 21, 1995 covering such financial statements
includes an explanatory paragraph regarding the change in method of accounting
for certain investment securities in 1994 and the change in method of
accounting for income taxes and post-retirement benefits other than pensions
in 1993.
The consolidated financial statements of PREMIER and its subsidiaries as of
December 31, 1994 and 1993, and for each of the years in the three-year period
ended December 31, 1994, have been included in the Annual Report on Form 10-K
of PREMIER for the year ended December 31, 1994 and incorporated by reference
in this Proxy Statement and Prospectus in reliance upon the report of KPMG
Peat Marwick LLP, independent certified public accountants and have been
incorporated by reference herein and upon the authority of said firm as
experts in accounting and auditing. The report of KPMG Peat Marwick LLP
covering the December 31, 1994 financial statements refers to changes in
PREMIER's method of accounting for securities and income taxes.
Any financial statements and schedules hereinafter incorporated by reference
in the Registration Statement of which this Prospectus and Proxy Statement is
a part that have been audited and are the subject of a report by independent
accountants will be so incorporated by reference in reliance upon such reports
and upon the authority of such firms as experts in accounting and auditing to
the extent covered by consents filed with the Commission.
LEGAL MATTERS
The validity of the BANC ONE Common Stock offered hereby has been passed
upon by Steven Alan Bennett, General Counsel of BANC ONE. Mr. Bennett owns a
number of shares of BANC ONE Common Stock and holds options to purchase
additional shares of BANC ONE Common Stock. Certain legal matters will be
passed upon for PREMIER by Jones, Walker, Waechter, Poitevent, Carrere &
Denegre, L.L.P., New Orleans, Louisiana. A partner in the law firm of Jones,
Walker, Waechter, Poitevent, Carrere & Denegre, L.L.P. is a director of
PREMIER and owns a number of shares of PREMIER Common Stock.
SOURCES OF INFORMATION
All information contained herein with respect to PREMIER has been provided
by PREMIER, and BANC ONE is relying upon the accuracy of that information. All
information contained herein with respect to BANC ONE has been provided by
BANC ONE, and PREMIER is relying upon the accuracy of that information.
REGISTRATION STATEMENT
This Prospectus and Proxy Statement does not include all of the information
set forth or incorporated by reference in the Registration Statement and the
exhibits thereto filed by BANC ONE with the Commission under the Securities
Act. The Registration Statement may be inspected at the principal office of
the Commission in Washington, D.C., and copies may be obtained upon payment of
prescribed fees. See "AVAILABLE INFORMATION" for addresses of the Commission's
offices. Reference is hereby made to the Registration Statement and exhibits
thereto for further information pertaining to BANC ONE and PREMIER.
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OTHER MATTERS
The Board of Directors of PREMIER does not know of any other matters which
may come before the Special Meeting.
INFORMATION ABOUT BANC ONE CORPORATION
GENERAL
BANC ONE is a multi-bank holding company incorporated under the laws of the
State of Ohio that, at June 30, 1995, had a total of 65 bank subsidiaries (the
"affiliate banks") in Arizona, Colorado, Illinois, Indiana, Kentucky, Ohio,
Oklahoma, Texas, Utah, West Virginia and Wisconsin. At June 30, 1995, BANC ONE
had consolidated total assets of $86.8 billion, consolidated total deposits of
$65.6 billion and consolidated total stockholders' equity of $7.8 billion
(8.99% of its consolidated total assets). At June 30, 1995, BANC ONE ranked
eighth among the nation's publicly owned bank holding companies in terms of
consolidated average total assets and sixth in terms of consolidated average
common equity. BANC ONE's 1994 consolidated net income of $1.01 billion ranked
seventh among the nation's 50 largest publicly owned bank holding companies.
At June 30, 1995 BANC ONE's affiliate banks held the largest statewide share
of total bank deposits in Arizona, the second largest share of such deposits
in Indiana, Kentucky, Ohio and West Virginia, and the third largest share of
such deposits in Colorado, Wisconsin and Texas. BANC ONE has smaller statewide
market shares in the other states in which BANC ONE operates banks. At June
30, 1995, except for Bank One Texas, N.A., no single BANC ONE affiliate bank
accounted for more than 20% of BANC ONE's consolidated total assets. BANC ONE
also operates additional corporations that engage in data processing, venture
capital, investment and merchant banking, trust, brokerage, investment
management, equipment leasing, mortgage banking, credit card, consumer finance
and insurance.
Since its formation in 1968, BANC ONE has acquired over 100 banking
institutions and the number of banking offices of its affiliate banks has
increased from 24 to over 1,400. BANC ONE continues to explore opportunities
to acquire banks and nonbank companies permitted by the Bank Holding Company
Act. Discussions are continually being carried on relating to such
acquisitions. It is not presently known whether, or on what terms, such
discussions will result in further acquisitions. BANC ONE's acquisition
strategy is flexible in that it does not require BANC ONE to effect specific
acquisitions so as to enter certain markets or to attain specified growth
levels. Rather than being market driven or size motivated, BANC ONE's
acquisition strategy reflects BANC ONE's willingness to consider potential
acquisitions wherever and whenever such opportunities arise based on the then-
existing market conditions and other circumstances. Banks to be acquired must
be of sufficient size to support and justify having management of a caliber
capable of making lending and other management decisions at the local level
under BANC ONE's operating philosophy. BANC ONE also is willing from time to
time to acquire a smaller bank when it can be acquired through a
reorganization into an existing affiliate. BANC ONE's interest in the
acquisition of nonbank companies has been limited to bank-related services
with which BANC ONE already has familiarity. BANC ONE's acquisitions may be
made by the exchange of stock, through cash purchases and with other
consideration.
BANC ONE is a legal entity separate and distinct from its affiliate banks
and its nonbanking subsidiaries. Accordingly, the right of BANC ONE, and thus
the right of BANC ONE's creditors and shareholders, to participate in any
distribution of the assets or earnings of any affiliate bank or other
subsidiary is necessarily subject to the prior claims of creditors of the
affiliate bank or subsidiary, except to the extent that claims of BANC ONE in
its capacity as a creditor may be recognized. The principal sources of BANC
ONE's revenues are dividends and fees from its affiliates. See "Regulatory
Matters" for a discussion of the restrictions on the affiliate banks' ability
to pay dividends to BANC ONE.
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BANC ONE is incorporated in Ohio and has functioned as a multi-bank holding
company since 1968. Its executive offices are located at 100 East Broad
Street, Columbus, Ohio 43215, and its telephone number is (614) 248-5944.
MARKET PRICES OF AND DIVIDENDS PAID ON BANC ONE COMMON STOCK
BANC ONE Common Stock is, and the shares offered hereby will be, listed on
the New York Stock Exchange and traded under the symbol "ONE." The following
table sets forth, for the periods indicated, the high and low reported closing
sale prices per share of BANC ONE Common Stock on the New York Stock Exchange
Composite Tape and cash dividends per share of BANC ONE Common Stock. The
dividend and stock price information has been adjusted to reflect all stock
dividends and stock splits on BANC ONE Common Stock, including the 10%
dividend on BANC ONE Common Stock paid on March 4, 1994 and the five shares
for four shares BANC ONE Common Stock split paid on August 31, 1993.
PRICE RANGE OF COMMON STOCK
<TABLE>
<CAPTION>
HIGH LOW DIVIDENDS
---- --- ---------
<S> <C> <C> <C>
1993
First Quarter.......................................... $42.27 $36.36 $.25
Second Quarter......................................... 44.73 36.73 .26
Third Quarter.......................................... 42.19 34.55 .28
Fourth Quarter......................................... 39.77 32.27 .28
1994
First Quarter.......................................... $35.47 $31.88 $.31
Second Quarter......................................... 38.00 30.75 .31
Third Quarter.......................................... 35.50 29.50 .31
Fourth Quarter......................................... 30.50 24.13 .31
1995
First Quarter.......................................... $30.13 $25.13 $.34
Second Quarter......................................... 35.13 28.63 .34
Third Quarter.......................................... 36.75 30.75 .34
Fourth Quarter......................................... 37.38 36.25
(through October 4, 1995)
</TABLE>
BANC ONE intends to continue its present policy of paying quarterly cash
dividends to its shareholders so that dividends will average between 35 and 40
percent of net income. The timing and amount of future dividends will depend
upon earnings, cash requirements, the financial condition of BANC ONE and its
subsidiaries, applicable government regulations and other factors deemed
relevant by the BANC ONE Board of Directors. Certain debt instruments to which
BANC ONE is a party limit its ability to pay dividends on BANC ONE Common
Stock. Under the most restrictive of these limitations, BANC ONE on a
consolidated basis would have been permitted to pay cash dividends on BANC ONE
Common Stock in excess of its $2.3 billion of retained earnings as of June 30,
1995. As described under "--Certain Regulatory Matters," various state and
federal laws limit the ability of affiliate banks to pay dividends to BANC
ONE.
CERTAIN REGULATORY MATTERS
General. BANC ONE is subject to the supervision of, and to regular
inspection by, the Board of Governors of the Federal Reserve System (the
"Federal Reserve"). BANC ONE's principal affiliate banks are organized as
national banking associations, which are subject to regulation by the Office
of the Comptroller of the Currency ("OCC"). In addition, various state
authorities regulate BANC ONE's state affiliate banks, and all
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of BANC ONE's affiliate banks are subject to regulation in some degree by the
Federal Reserve and the Federal Deposit Insurance Corporation (the "FDIC"). In
addition to banking laws, regulations and regulatory agencies, BANC ONE and
its affiliates are subject to various other laws, regulations and regulatory
agencies, all of which directly or indirectly affect BANC ONE's operations,
management and ability to make distributions. The following discussion
summarizes certain aspects of those laws and regulations that affect BANC ONE.
Proposals to change the laws and regulations governing the banking industry
are frequently raised in Congress, in the state legislatures and before the
various bank regulatory agencies. The likelihood and timing of any changes and
the impact such changes might have on BANC ONE and its subsidiaries are
difficult to determine.
BANC ONE's affiliate banks are affected by various state and federal laws
and by the fiscal and monetary policies of the federal government and its
agencies, including the Federal Reserve. An important purpose of these fiscal
and monetary policies is to curb inflation and control recessions through
control of the supply of money and credit. The Federal Reserve uses its powers
to regulate reserve requirements of its member banks, to set the discount rate
on extensions of credit to insured depository institutions and to conduct open
market operations in United States government securities so as to exercise
control over the supply of money and credit. These policies directly affect
the amount of, and the interest rates on, bank loans and deposits, and this
materially affects bank earnings. Future policies of the Federal Reserve and
other authorities cannot be predicted, nor can their effect on future bank
earnings be predicted. Similarly, future changes in state and federal laws and
wage, price and other economic restraints of the federal government cannot be
predicted nor can their effect on future bank earnings be predicted.
Holding Company Structure. BANC ONE is a legal entity separate and distinct
from its affiliates. Accordingly, the right of BANC ONE, and thus the rights
of BANC ONE's creditors and shareholders, to participate in any distribution
of the assets or earnings of any affiliate is necessarily subject to the prior
claims of creditors of such affiliate, except to the extent that claims of
BANC ONE in its capacity as a creditor may be recognized. The principal
sources of BANC ONE's revenues are dividends and fees from its affiliates.
BANC ONE's affiliate banks are subject to restrictions under federal law
which limit the transfer of funds by the affiliate banks to BANC ONE and its
nonbanking subsidiaries, whether in the form of loans, extensions of credit,
investments or asset purchases. Such transfers by any affiliate bank to BANC
ONE or any nonbanking subsidiary are limited in amount to 10% of the bank's
capital and surplus and, with respect to BANC ONE and all such nonbanking
subsidiaries, to an aggregate of 20% of such bank's capital and surplus.
Furthermore, such loans and extensions of credit are required to be secured in
specified amounts.
The Federal Reserve has a policy to the effect that a bank holding company
is expected to act as a source of financial and managerial strength to each of
its subsidiary banks and to commit resources to support each such subsidiary
bank. This support may be required at times when BANC ONE may not have the
resources to provide it. Any capital loans by BANC ONE to any of the affiliate
banks are subordinate in right of payment to deposits and to certain other
indebtedness of such affiliate bank. In addition, in the event of a bank
holding company's bankruptcy any commitment by the bank holding company to a
federal bank regulatory agency to maintain the capital of an affiliate bank
will be assumed by the bankruptcy trustee and entitled to a priority of
payment.
A depository institution insured by the FDIC can be held liable for any loss
incurred by, or reasonably expected to be incurred by, the FDIC after August
9, 1989, in connection with (i) the default of a commonly controlled FDIC-
insured depository institution or (ii) any assistance provided by the FDIC to
a commonly controlled FDIC-insured depository institution in danger of
default. "Default" is defined generally as the appointment of a conservator or
receiver and "in danger of default" is defined generally as the existence of
certain conditions indicating that a "default" is likely to occur in the
absence of regulatory assistance.
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Federal law (12 U.S.C. Section 55) permits the OCC to order the pro rata
assessment of shareholders of a national bank whose capital stock has become
impaired, by losses or otherwise, to relieve a deficiency in such national
bank's capital stock. This statute also provides for the enforcement of any
such pro rata assessment of shareholders of such national bank to cover such
impairment of capital stock by sale, to the extent necessary, of the capital
stock of any assessed shareholder failing to pay the assessment. Similarly,
the laws of certain states provide for such assessment and sale with respect
to banks chartered by such states. BANC ONE, as the sole shareholder of
certain of its affiliate national banks, is subject to such provisions.
Capital Requirements. BANC ONE is subject to capital ratios, requirements
and guidelines imposed by the Federal Reserve, which are substantially similar
to the ratios, requirements and guidelines imposed by the Federal Reserve, the
OCC and the FDIC on the banks within their respective jurisdictions. These
capital requirements are designed to require more capital of banks and bank
holding companies that are subject to greater risks. For this purpose, a
bank's or holding company's assets and certain specified off-balance sheet
commitments are assigned to four risk categories, each weighted differently
based on the level of risk that is ascribed to such assets or commitments. A
bank's or holding company's capital, in turn, is divided into two tiers: core
("Tier 1") capital, which includes common equity, non-cumulative perpetual
preferred stock and related surplus (excluding auction rate issues), and
minority interests in equity accounts of consolidated subsidiaries, less
goodwill, certain identifiable intangible assets and certain other assets; and
supplementary ("Tier 2") capital, which includes, among other items,
cumulative and limited-life preferred stock not meeting the Tier 1 definition,
mandatory convertible securities, subordinated debt and allowances for loan
and lease losses, subject to certain limitations, less certain required
deductions.
BANC ONE, like other bank holding companies, currently is required to
maintain Tier 1 and total capital (the sum of Tier 1 and supplementary
capital) equal to at least 4% and 8% of its total risk-weighted assets,
respectively. At June 30, 1995, BANC ONE met both requirements, with Tier 1
and total capital equal to 10.36% and 13.76% of its total risk-weighted
assets, respectively.
The Federal Reserve also requires bank holding companies to maintain a
minimum "leverage ratio" (Tier 1 capital to adjusted total assets) of 3%, if
the holding company has the highest regulatory rating and meets certain other
requirements, or of 3% plus an additional cushion of at least 100 to 200 basis
points if the holding company does not meet these requirements. At June 30,
1995, BANC ONE met this requirement with a leverage ratio of 8.72%.
The Federal Reserve may set capital requirements higher than the minimums
noted above for holding companies whose circumstances warrant it. For example,
holding companies experiencing or anticipating significant growth may be
expected to maintain capital ratios including tangible capital positions well
above the minimum levels. The Federal Reserve has not, however, imposed any
such special capital requirement on BANC ONE.
On September 14, 1993, the Federal Reserve, the FDIC and the OCC issued a
joint notice of proposed rulemaking, soliciting comments on a proposal to
revise their risk-based capital standards to take account of interest rate
risk. The notices propose alternative approaches for determining the
additional amount of capital, if any, that may be required to compensate for
interest rate risk. The first approach would reduce a depository institution's
risk-based capital ratios by an amount based on its measured exposure to
interest rate risk in excess of a specified threshold. The second approach
would assess the need for additional capital on a case-by-case basis,
considering both the level of measured exposure and qualitative risk factors.
BANC ONE cannot assess at this point the impact, if any, that such proposals
would have on its capital ratios.
Dividend Restrictions. Various federal and state statutory provisions limit
the amount of dividends BANC ONE's affiliate banks can pay to BANC ONE without
regulatory approval. The approval of the appropriate bank regulator is
required for any dividend by a national bank or by a state-chartered bank that
is a member of the Federal Reserve System (a "state member bank") if the total
of all dividends declared by the bank in any calendar year would exceed the
total of its net profits, as defined by regulatory agencies, for such year
combined
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with its retained net profits for the preceding two years. In addition, a
national bank or a state member bank may not pay a dividend in an amount
greater than its net profits then on hand. At December 31, 1994, total
stockholders' equity of the affiliate banks approximated $7.2 billion, of
which $1.4 billion was available for payment of dividends without approval by
the applicable regulatory authority.
In addition, federal bank regulatory authorities have authority to prohibit
the affiliate banks from engaging in an unsafe or unsound practice in
conducting their business. The payment of dividends, depending upon the
financial condition of the bank in question, could be deemed to constitute
such an unsafe or unsound practice. The ability of BANC ONE's affiliate banks
to pay dividends in the future is presently, and could be further, influenced
by bank regulatory policies and capital guidelines.
Federal Deposit Insurance Corporation Improvement Act of 1991. The Federal
Deposit Insurance Corporation Improvement Act of 1991 ("FDICIA") significantly
expanded the regulatory and enforcement powers of federal banking regulators,
in particular the FDIC, and has important consequences for BANC ONE, its
affiliate banks and other depository institutions located in the United
States.
A major feature of FDICIA is the comprehensive directions it gives to
federal banking regulators to promptly direct or require the correction of
problems at inadequately capitalized banks in the manner that is least costly
to the federal deposit insurance funds. The degree of corrective regulatory
involvement in the operations and management of banks and their holding
companies is, under FDICIA, largely determined by the actual or anticipated
capital positions of the subject institution.
FDICIA established five tiers of capital measurement for regulatory purposes
ranging from "well capitalized" to "critically undercapitalized." Under
regulations adopted by the federal banking agencies, a depository institution
is well capitalized if it significantly exceeds the minimum level required by
regulation for each relevant capital measure, adequately capitalized if it
meets such measure, undercapitalized if it fails to meet any such measure,
significantly undercapitalized if it is significantly below such measure and
critically undercapitalized if its tangible equity is not greater than 2% of
total tangible assets. A depository institution may be deemed to be in a
capitalization category lower than is indicated by its actual capital position
if it receives an unsatisfactory examination rating. FDICIA requires banking
regulators to take increasingly strong corrective steps, based on the capital
tier of any subject bank, to cause such bank to achieve and maintain capital
adequacy. Even if a bank is adequately capitalized, however, the banking
regulators are authorized to apply corrective measures if the bank is
determined to be in an unsafe or unsound condition or engaging in an unsafe or
unsound activity.
Depending on the level of capital of an insured depository institution, the
banking regulatory agencies' corrective powers can include: requiring a
capital restoration plan; placing limits on asset growth and restrictions on
activities; requiring the institution to reduce total assets; requiring the
institution to issue additional stock (including voting stock) or to be
acquired; placing restrictions on transactions with affiliates; restricting
the interest rate the institution may pay on deposits; ordering a new election
for the institution's board of directors; requiring that certain senior
executive officers or directors be dismissed; prohibiting the institution from
accepting deposits from correspondent banks; requiring the institution to
divest certain subsidiaries; prohibiting the payment of principal or interest
on subordinated debt; prohibiting the institution's parent bank holding
company from making capital distributions without prior regulatory approval;
and, ultimately, appointing a conservator or receiver for the institution.
If the insured depository institution is undercapitalized, the parent bank
holding company is required to guarantee that the institution will comply with
any capital restoration plan submitted to, and approved by, the appropriate
federal banking agency in an amount equal to the lesser of (i) 5% of the
institution's total assets at the time the institution became undercapitalized
or (ii) the amount which is necessary (or would have been necessary) to bring
the institution into compliance with all applicable capital standards as of
the time the institution fails to comply with the capital restoration plan. If
such parent bank holding company guarantee is not obtained, the capital
restoration plan may not be accepted by the banking regulators. As a result,
such
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institution would be subject to the more severe restrictions imposed on
significantly undercapitalized institutions. Further, the failure of such a
depository institution to submit an acceptable capital plan is grounds for the
appointment of a conservator or receiver.
FDICIA also contains a number of other provisions affecting depository
institutions, including additional reporting and independent auditing
requirements, the establishment of safety and soundness standards, the
changing of FDIC insurance premiums from flat amounts to the system of risk-
based assessments described below under "Deposit Insurance Assessments", a
review of accounting standards, and supplemental disclosures and limits on the
ability of all but well capitalized depository institutions to acquire
brokered deposits. The Riegle-Community Development and Regulatory Improvement
Act of 1994, however, among other things, contains a number of specific
provisions easing the regulatory burden on banks and bank holding companies,
including some imposed by FDICIA, and making the bank regulatory system more
efficient. Federal banking regulators are taking actions to implement these
provisions.
Deposit Insurance Assessments. The deposits of each of BANC ONE's affiliate
banks are insured up to regulatory limits by the FDIC and, accordingly, are
subject to deposit insurance assessments to maintain the Bank Insurance Fund
("BIF") administered by the FDIC. The FDIC has adopted regulations
establishing a permanent risk-related deposit insurance assessment system.
Under this system, the FDIC places each insured bank in one of nine risk
categories based on (a) the bank's capitalization and (b) supervisory
evaluations provided to the FDIC by the institution's primary federal
regulator. Each insured bank's insurance assessment rate is then determined by
the risk category in which it is classified by the FDIC.
Until June 1, 1995, there was an eight basis point spread between the
highest and lowest assessment rates, with banks classified in the highest
capital and supervisory evaluation categories being subject to a rate of $0.23
per $100 of deposits and banks classified in the lowest capital and
supervisory evaluation categories being subject to a rate of $0.31 per $100 of
deposits. These assessment rates reflected, in substantial part, the amount
the FDIC had determined necessary to increase the reserve ratio of the BIF to
1.25% of total insured bank deposits. Under FDICIA, the FDIC was required to
set deposit insurance premium rates at a level sufficient to achieve that
ratio by 2006.
The FDIC recently determined that the BIF attained the required 1.25%
reserve ratio on or before June 1, 1995. Accordingly, the FDIC has ordered a
reduction in BIF deposit insurance premium rates. The new rates take effect
September 29, 1995. In addition, banks will receive a refund for the
difference between the new rates and the old rates for the period from June 1,
1995 through September 29, 1995. Under the new assessment system, there is a
27 basis point spread between the highest and lowest assessment rates, with
banks classified in the highest capital and supervisory evaluation categories
being subject to a rate of $0.04 per $100 of deposits and banks classified in
the lowest capital and supervisory evaluation categories continuing to be
subject to a rate of $0.31 per $100 of deposits. The new rates will apply to
all subsequent assessment periods, with modification as necessary in future
periods to maintain the reserve ratio at the required level by means of an
adjustment factor of plus-or-minus five basis points.
Because the FDIC's Savings Association Insurance Fund ("SAIF"), which
insures savings institution deposits, has not yet reached the required 1.25%
reserve ratio, and is not projected to do so for several years, SAIF deposit
insurance premium rates have not been lowered, and will continue to range from
$0.23 per $100 of deposits for savings institutions in the highest capital and
supervisory evaluation categories to $0.31 per $100 of deposits for savings
institutions in the lowest capital and supervisory evaluation categories.
However, Congress is considering proposals to recapitalize the SAIF and/or
merge the SAIF with the BIF. It is uncertain whether or when such proposals
might be adopted, or what impact they might have on the BIF or on BIF-insured
institutions.
Some BANC ONE affiliate banks hold deposits that were acquired from savings
institutions and that, accordingly, are insured by SAIF. At June 30, 1995,
BANC ONE's affiliate banks held in aggregate
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<PAGE>
approximately $6.3 billion of such deposits. Deposit insurance premiums will
be charged on these deposits at the higher SAIF rate.
Depositor Preference Statute. Federal legislation has been enacted providing
that deposits and certain claims for administrative expenses and employee
compensation against an insured depository institution would be afforded a
priority over other general unsecured claims against such institution,
including federal funds and letters of credit, in the "liquidation or other
resolution" of the institution by any receiver.
Brokered Deposits. Under FDIC regulations, no FDIC-insured bank or savings
institution can accept brokered deposits unless it (a) is well capitalized or
(b) is adequately capitalized and receives a waiver from the FDIC. In
addition, these regulations prohibit any bank or savings institution that is
not well capitalized from (a) paying an interest rate on deposits in excess of
75 basis points over certain prevailing market rates or (b) offering "pass
through" deposit insurance on certain employee benefit plan accounts unless it
provides certain notice to affected depositors. At June 30, 1995, BANC ONE's
bank subsidiaries had aggregate total brokered deposits of approximately $94
million.
Interstate Banking. Under the Riegle-Neal Interstate Banking and Branching
Efficiency Act of 1994 ("Riegle-Neal"), subject to certain concentration
limits, (a) bank holding companies such as BANC ONE are permitted, beginning
September 29, 1995, to acquire banks and bank holding companies located in any
state; (b) any bank that is a subsidiary of a bank holding company is
permitted, again beginning September 29, 1995, to receive deposits, renew time
deposits, close loans, service loans and receive loan payments as an agent for
any other bank subsidiary of that holding company; and (c) banks are
permitted, beginning June 1, 1997, to acquire branch offices outside their
home states by merging with out-of-state banks, purchasing branches in other
states, and establishing de novo branch offices in other states, provided
that, in the case of any such purchase or opening of individual branches, the
host state has adopted legislation "opting in" to those provisions of Riegle-
Neal; and provided that, in the case of a merger with a bank located in
another state, the host state has not adopted legislation "opting out" of that
provision of Riegle-Neal. BANC ONE might use Riegle-Neal to acquire banks in
additional states and to consolidate its bank subsidiaries under a smaller
number of separate charters.
INCORPORATION OF CERTAIN INFORMATION ABOUT BANC ONE BY REFERENCE
BANC ONE's Annual Report on Form 10-K for the fiscal year ended December 31,
1994 (as amended by Form 10-K/A filed April 4, 1995 and Form 10-K/A filed June
29, 1995), BANC ONE's Quarterly Reports on Form 10-Q for the quarters ended
March 31, 1995 and June 30, 1995 and BANC ONE's Current Reports on Form 8-K
dated July 19, 1995 and July 24, 1995, in each case filed with the Commission
pursuant to Section 13 of the Exchange Act and the description of BANC ONE
Common Stock set forth in BANC ONE's Registration Statement on Form 8-B dated
May 1, 1989, including any amendment or report filed for the purpose of
updating such description, are incorporated into this Prospectus and Proxy
Statement by reference. See "INCORPORATION BY REFERENCE."
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<PAGE>
INFORMATION ABOUT PREMIER BANCORP, INC.
GENERAL
PREMIER is the bank holding company of Premier Bank, a national banking
association offering banking and trust services through more than 150 branches
located throughout Louisiana. Premier Bank has branch offices in seven of the
eight major metropolitan areas of Louisiana. PREMIER also has a wholly owned,
nonbank subsidiary that provides discount brokerage services. At June 30,
1995, PREMIER had consolidated total assets of $5.5 billion, consolidated
total deposits of $4.3 billion and consolidated total stockholders' equity of
$477 million.
Premier Bank is a full-service commercial bank offering a comprehensive
range of consumer and commercial banking services including checking, savings
and time deposits of various types, consumer installment, real estate and
commercial loans, investment services, electronic banking facilities and wire
transfer facilities. In addition, Premier Bank offers a full range of personal
and corporate trust services.
PREMIER has one other wholly owned subsidiary, Premier Securities
Corporation ("Premier Securities"). Premier Securities is registered as a
securities broker-dealer under the rules of the Commission and the laws of the
State of Louisiana and is a member of the National Association of Securities
Dealers, Inc. Premier Securities offers discount brokerage services in the
major offices of Premier Bank. Premier Bank has two principal subsidiaries:
Premier Investment Advisors, L.L.C. and Premier Mortgage Company, L.C. Premier
Investment Advisers, L.L.C. is a registered investment advisor under the
Investment Advisers Act of 1940 and (i) acts as portfolio manager for the
trust assets of Premier Bank, as well as the manager of the Paragon Portfolio,
a family of mutual funds distributed by Goldman Sachs and Company, and (ii)
provides direct investment advisory services to a select group of clients. Its
main office is located in Baton Rouge. Premier Mortgage Company, L.C. engages
in the business of originating and servicing real estate mortgage loans that
qualify for resale and at August 31, 1995 was servicing $969.6 million in
loans for unaffiliated investors.
MARKET PRICES OF AND DIVIDENDS PAID ON PREMIER COMMON STOCK
PREMIER Common Stock is a Nasdaq National Market System security traded on
The Nasdaq Stock Market under the symbol "PRBC." The following table sets
forth, for the periods indicated, the high and low reported closing sale
prices per share of PREMIER Common Stock as reported on The Nasdaq Stock
Market. PREMIER did not pay any cash dividends during any such period of time
except for a $0.25 per share dividend in the third quarter of 1995. PREMIER's
ability to pay dividends in the future is subject to the Merger Agreement. See
"MERGER--General." The stock price information has been adjusted to reflect a
10% stock dividend in June 1993.
PRICE RANGE OF COMMON STOCK
<TABLE>
<CAPTION>
HIGH LOW
------ ------
<S> <C> <C>
1993
First Quarter................................................... $16.82 $13.41
Second Quarter.................................................. 16.94 14.38
Third Quarter................................................... 17.25 15.00
Fourth Quarter.................................................. 18.38 17.50
1994
First Quarter................................................... $18.00 $17.13
Second Quarter.................................................. 18.13 16.44
Third Quarter................................................... 17.75 16.75
Fourth Quarter.................................................. 17.25 15.25
1995
First Quarter................................................... $16.63 $15.63
Second Quarter.................................................. 18.13 16.13
Third Quarter................................................... 22.25 17.88
Fourth Quarter.................................................. 22.50 22.06
(through October 4, 1995)
</TABLE>
48
<PAGE>
INCORPORATION OF CERTAIN INFORMATION ABOUT PREMIER BY REFERENCE
PREMIER's Annual Report on Form 10-K for the fiscal year ended December 31,
1994, PREMIER's Quarterly Reports on Form 10-Q for the quarters ended March
31, 1995 and June 30, 1995 and PREMIER's Current Reports on Form 8-K dated
January 11, 1995, April 12, 1995, May 2, 1995, July 12, 1995 and July 19,
1995, in each case filed with the Commission pursuant to Section 13 of the
Exchange Act, and the description of PREMIER Common Stock set forth in
PREMIER's Current Report on Form 8-K dated February 22, 1991, including any
amendment or report filed for the purpose of updating such description, are
incorporated into this Prospectus and Proxy Statement by reference. See
"INCORPORATION BY REFERENCE."
VOTING AND MANAGEMENT INFORMATION
Solicitation of proxies will be made in person, by mail or by telephone or
telegraph by present and former directors, officers and employees of PREMIER
for which no additional compensation will be paid. PREMIER has also retained
Corporate Investors Communications, Inc. to assist in the solicitation of
proxies, for a fee of approximately $5,000 plus reasonable out-of-pocket
expenses. PREMIER will bear the cost of solicitation of proxies from its
shareholders and may reimburse brokers and others for their expenses in
forwarding solicitation material to beneficial owners of its voting stock.
BANC ONE will pay the costs of preparing and printing this Prospectus and
Proxy Statement. Copies of the form of proxy and Notice and this Prospectus
and Proxy Statement will be mailed to shareholders on or about October 13,
1995.
VOTING
The PREMIER Board has fixed the close of business on October 10, 1995 as the
Record Date for determination of shareholders entitled to notice of and to
vote at the Special Meeting. As of the record date, 34,911,012 shares of
PREMIER Common Stock were outstanding, each of which entitles its holder to
one vote on each matter submitted to the vote of shareholders at the Special
Meeting. The presence in person or by proxy of the holders of a majority of
the shares of PREMIER Common Stock outstanding is required to constitute a
quorum for the Special Meeting. Approval of the Merger Agreement requires the
affirmative vote of not less than a majority of the outstanding shares of
PREMIER Common Stock entitled to vote thereon and present at the Special
Meeting.
Votes, whether in person or by proxy, will be counted and tabulated by
inspectors appointed by PREMIER. The inspectors will treat shares of PREMIER
Common Stock represented by a properly executed and returned proxy as present
at the Special Meeting for purposes of determining a quorum. An abstention
will have the same effect as a vote against the proposal to approve the Merger
Agreement, and a broker non-vote will have no effect on the outcome of the
vote on the proposal.
The form of proxy accompanying this Prospectus and Proxy Statement is
solicited by the Board of Directors of PREMIER. A shareholder may use a proxy
whether or not he or she intends to attend the Special Meeting in person. The
proxy may be revoked in writing by the person giving it at any time before it
is exercised by notice to the Secretary of PREMIER, by executing and
submitting a later dated proxy or by attending and voting in person at the
Special Meeting. All proxies validly submitted and not revoked will be voted
in the manner specified therein. IF NO SPECIFICATION IS MADE, THE PROXIES WILL
BE VOTED IN FAVOR OF APPROVAL OF THE MERGER AGREEMENT. The PREMIER Board is
not aware of any other matters which may be presented for action at the
Special Meeting, but if other matters do properly come before the meeting it
is intended that the shares represented by the accompanying proxy will be
voted by the persons named in the proxy in accordance with their best
judgment.
The Directors of PREMIER have unanimously approved the Merger Agreement.
PREMIER believes that each of its directors will vote all of his shares in
favor of the Merger Agreement.
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<PAGE>
RIGHTS OF DISSENTING SHAREHOLDERS
Unless the Merger Agreement is approved by the holders of at least 80% of
the outstanding shares of PREMIER Common Stock, Section 131 of Louisiana Law
("Section 131") allows a shareholder of PREMIER who objects to the Merger and
who complies with the provisions of that section to dissent and, if the Merger
is effected, to have paid to him in cash the fair cash value of his shares of
PREMIER Common Stock as of the day before the Special Meeting, as determined
by agreement between the shareholder and the corporation surviving the Merger
(the "Surviving Corporation") or by a district court of the State of Louisiana
for the Parish of East Baton Rouge if the shareholder and the Surviving
Corporation are unable to agree upon the fair cash value. Such fair cash value
would be payable only when and if the Merger is consummated, and would be paid
without interest.
To exercise the right of dissent, a shareholder must (i) file with PREMIER a
written objection to the Merger Agreement prior to or at the Special Meeting
and (ii) also vote his shares (in person or by proxy) against the Merger
Agreement at the Special Meeting. Neither a vote against the Merger Agreement
nor a specification in a proxy to vote against the Merger Agreement will in
and of itself constitute the necessary written objection to the Merger
Agreement. Moreover, by voting in favor of, or abstaining from voting on, the
Merger Agreement, or by returning the enclosed proxy without instructing the
proxyholders to vote against the Merger Agreement, a shareholder waives his
rights under Section 131. Thus, for example, a shareholder who executes and
returns a blank proxy with no specifications as to how it is to be voted will
lose any rights under Section 131.
If the Merger Agreement is approved by less than 80% of the total voting
power of PREMIER, and the Merger is consummated, notice of the consummation of
the Merger will be given to each shareholder of PREMIER who both filed a
written objection to and voted against the Merger Agreement in compliance with
Section 131. Within 20 days after the mailing of such notice, the shareholder
must file with the Surviving Corporation a written demand for payment for his
shares at their fair cash value as of the day before the date of the Special
Meeting and must state the amount demanded and a post office address to which
the Surviving Corporation may reply. He must also deposit the certificate(s)
representing his shares of PREMIER Common Stock in escrow with a bank or trust
company located in East Baton Rouge Parish, Louisiana. With the above-
mentioned demand, the shareholder must also deliver to the Surviving
Corporation the written acknowledgment of such bank or trust company that it
holds the certificate(s), duly endorsed and transferred to the Surviving
Corporation, upon the sole condition that the certificate(s) will be delivered
to the Surviving Corporation upon payment of the fair cash value of the shares
in accordance with Section 131. A shareholder who perfects his dissenters'
rights, upon filing a demand for the value of his shares, will, under
Louisiana Law, no longer have any rights as a shareholder, including the right
to pursue state law claims.
If the Surviving Corporation does not agree to the amount demanded by the
shareholder, or does not agree that payment is due, it will, within 20 days
after receipt of such demand and acknowledgment, notify such shareholder in
writing of either (i) the amount it will agree to pay, if any payment should
be held to be due, or (ii) that it does not believe that any payment is due.
If the shareholder does not agree to accept the offered amount, or disagrees
with the Surviving Corporation's assertion that no payment is due, he must,
within 60 days after receipt of such notice, file suit against the Surviving
Corporation in a district court of the State of Louisiana for the Parish of
East Baton Rouge for a judicial determination of the fair cash value of the
shares. Any shareholder entitled to file such a suit may, within such 60-day
period, but not thereafter, intervene as a plaintiff in any such suit filed
against the Surviving Corporation by another shareholder of PREMIER for a
judicial determination of the fair cash value of such other shareholder's
shares. If a shareholder fails to bring or to intervene in such a suit within
the applicable 60-day period, he will be deemed to have consented to accept
the Surviving Corporation's statement that no payment is due or, if the
Surviving Corporation does not contend that no payment is due, to accept the
amount specified by the Surviving Corporation in its notice of disagreement.
If, upon the filing of any such suit or intervention, the Surviving
Corporation deposits with the court the amount, if any, which it specified in
its notice of disagreement, and if in that notice the Surviving Corporation
offered to pay such amount to the shareholder on demand, then the costs (not
including legal fees) of the suit or
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<PAGE>
intervention will be taxed against the shareholder if the amount finally
awarded to him, exclusive of interest and costs, is equal to or less than the
amount so deposited; otherwise, the costs (not including legal fees) will be
taxed against the Surviving Corporation.
Upon filing a demand for the fair cash value of his shares, a shareholder
ceases to have any rights of a shareholder except the rights provided by
Section 131. The shareholder's demand may be withdrawn voluntarily at any time
before the Surviving Corporation gives its notice of disagreement, but
thereafter only with the written consent of the Surviving Corporation. If
withdrawn, or if the shareholder otherwise loses his dissenters' rights, such
shareholder will be reinstated to his rights as a shareholder as of the time
of filing of his demand for fair cash value, including any intervening
preemptive rights or rights to dividends or other distributions; if, however,
such preemptive rights have expired or any dividend or distribution other than
in cash has been completed, the Surviving Corporation may elect to pay the
fair value thereof in cash as of the time such preemptive rights expired or
the dividend or distribution was completed.
Prior to the Special Meeting and thereafter until the date the Merger is
effected, dissenting shareholders of PREMIER should send any communications
regarding their rights to Premier Bancorp, Inc., 451 Florida Street, Baton
Rouge, Louisiana 70801, Attn: Secretary. On or after the date the Merger is
effected, dissenting shareholders of PREMIER should send any communications
regarding their rights to the address that will be specified in the notice of
consummation of the Merger.
All communications must be signed by or on behalf of the dissenting
shareholder in the form in which his shares are registered on the books of
PREMIER.
THE FOREGOING SUMMARY OF SECTION 131 OF THE LOUISIANA BUSINESS CORPORATION
LAW IS NECESSARILY INCOMPLETE AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
THAT SECTION SET FORTH IN APPENDIX B.
MANAGEMENT AND PRINCIPAL SHAREHOLDERS OF BANC ONE
Information concerning the directors and executive officers of BANC ONE,
compensation of directors and executive officers of BANC ONE and any related
transactions in which they have an interest, together with information related
to principal shareholders of BANC ONE, is set forth in BANC ONE's Proxy
Statement dated March 11, 1995, incorporated herein by reference to BANC ONE's
Annual Report on Form 10-K for the year ended December 31, 1994. See
"INCORPORATION BY REFERENCE."
MANAGEMENT AND PRINCIPAL SHAREHOLDERS OF PREMIER
Information concerning the directors and executive officers of PREMIER,
compensation of directors and executive officers of PREMIER and any related
transactions in which they have an interest, together with information related
to principal shareholders of PREMIER, is set forth in PREMIER's Proxy
Statement dated March 10, 1995, incorporated herein by reference to PREMIER's
Annual Report on Form 10-K for the year ended December 31, 1994. See
"INCORPORATION BY REFERENCE."
51
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APPENDIX A
Investment Banking Group
World Financial Center
North Tower
New York, New York 10281-1325
212 449 1000
[LOGO of Merrill Lynch, Pierce, Fenner & Smith Incorporated]
October 13, 1995
Board of Directors
Premier Bancorp, Inc.
Premier Centre--North Tower
451 Florida Street
Baton Rouge, Louisiana 70801
Members of the Board:
Premier Bancorp Inc. ("Premier") and Banc One Corporation ("Banc One") have
entered into an agreement (the "Agreement") pursuant to which Premier will be
merged with a wholly owned subsidiary of Banc One in a transaction (the
"Merger") in which each outstanding share of Premier's common stock, no par
value, $5.00 stated value (the "Premier Shares"), will be converted into the
right to receive 0.617761 shares (the "Exchange Ratio") of the common stock,
no par value, $5.00 stated value, of Banc One (the "Banc One Shares"). In
addition, the Agreement provides that Premier may declare and pay quarterly
dividends on the Premier Shares in the amount of $0.25 per Premier Share prior
to the completion of the Merger.
You have asked us whether, in our opinion, the proposed Exchange Ratio in
the Merger is fair to the holders of Premier Shares (other than Banc One) from
a financial point of view.
In arriving at the opinion set forth below, we have, among other things:
(1) Reviewed Premier's Annual Reports, Forms 10-K and related financial
information for the three fiscal years ended December 31, 1994 and
Premier's Quarterly Reports on Form 10-Q and the related unaudited
financial information for the quarterly periods ended March 31, 1995
and June 30, 1995;
(2) Reviewed Banc One's Annual Reports, Forms 10-K and related financial
information for the three fiscal years ended December 31, 1994 and Banc
One's Quarterly Reports on Form 10-Q and the related unaudited
financial information for the quarterly periods ended March 31, 1995
and June 30, 1995;
(3) Reviewed certain information, including financial forecasts, relating
to the business, earnings, assets and prospects of Premier and Banc
One, furnished to us by Premier and Banc One;
(4) Conducted discussions with members of senior management of Premier and
Banc One concerning their respective businesses, operations, regulatory
condition and prospects;
(5) Reviewed the historical market prices and trading activity for the
Premier Shares and the Banc One Shares and compared them with those of
certain publicly traded companies which we deemed to be relevant;
(6) Compared the results of operations of Premier and Banc One with those
of certain companies which we deemed to be relevant;
(7) Compared the proposed financial terms of the transactions contemplated
by the Agreement with the financial terms of certain other mergers and
acquisitions which we deemed to be relevant;
(8) Analyzed the pro forma impact of the transaction on the earnings and
book value per share, consolidated capitalization and certain balance
sheet and profitability ratios of Banc One;
A-1
<PAGE>
[LOGO of Merrill Lynch, Pierce, Fenner & Smith Incorporated]
(9) Participated in discussions and negotiations among representatives of
Premier and Banc One;
(10) Reviewed the Agreement dated July 19, 1995; and
(11) Reviewed such other financial studies and analyses and performed such
other investigations and took into account such other matters as we
deemed necessary to the rendering of this opinion.
In preparing our opinion, we have relied on the accuracy and completeness of
all information supplied or otherwise made available to us by Premier and Banc
One, and we have not assumed any responsibility for independently verifying
such information or undertaking an independent evaluation or appraisal of the
assets or liabilities of Premier or Banc One or any of their subsidiaries nor
have we been furnished any such evaluation or appraisal. We have also relied
upon the managements of Premier and Banc One as to the reasonableness and
achievability of the financial operating forecasts (and the assumptions and
bases therefore) provided to us. In that regard, we have assumed with your
consent that such forecasts and projections regarding future economic
conditions and results of operations reflect the best currently available
estimates and judgments of such respective managements and that such
projections and forecasts will be realized in the amounts and the time periods
currently estimated by the managements of Premier and Banc One. Our opinion is
necessarily based on economic, market and other conditions as in effect on,
and the information made available to us as of, the date hereof. We are not
experts in the evaluation of allowances for loan losses and we have not
assumed any responsibility for making an independent evaluation of the
adequacy of the allowance for loan losses of Premier and Banc One nor have we
reviewed any individual credit files.
For purposes of our opinion, we reviewed the terms of the Agreement and Plan
of Acquisition, dated as of March 26, 1992, as amended, between Premier and
Banc One, and the related agreements referred to therein, and considered the
effect of such agreements on the Merger and possible alternative transactions
involving Premier.
We have been retained by the Board of Directors of Premier as an independent
contractor to act as financial advisor to Premier with respect to the Merger
and will receive a fee for our services. We have, in the past, provided
financial advisory and financing services to Premier and Banc One and have
received fees for the rendering of such services. In addition, in the ordinary
course of business, we may actively trade debt and/or equity securities of
Premier and Banc One and their respective affiliates for our own account and
the accounts of our customers, and we therefore may from time to time hold a
long or short position in such securities.
Our opinion is directed to the Board of Directors of Premier and does not
constitute a recommendation to any shareholder of Premier as to how such
shareholder should vote at any shareholder meeting of Premier held in
connection with the Merger.
On the basis of, and subject to the foregoing, we are of the opinion that
the proposed Exchange Ratio in the Merger is fair to the holders of Premier
Shares (other than Banc One) from a financial point of view.
Very truly yours,
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
A-2
<PAGE>
APPENDIX B
SECTION 131 OF THE LOUISIANA BUSINESS CORPORATION LAW
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, or were designated as a national market system security on an
inter-dealer quotation system by the National Association of Securities
Dealers, 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
B-1
<PAGE>
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 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
B-2
<PAGE>
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.
B-3
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF OFFICERS AND DIRECTORS.
Section 1701.13(E) of the Ohio General Corporation Law sets forth provisions
which define the extent to which a corporation may indemnify directors,
officers and employees. Those provisions have been adopted by the Registrant
in Article V of the Registrant's Code of Regulations. Article V provides for
the indemnification or the purchase of insurance for the benefit of the
directors, officers, employees and agents of the Registrant in the event such
persons are subject to legal action as a result of actions in their capacities
as directors, officers, employees or agents of the Registrant. The Registrant
has entered into indemnification agreements with its directors and executive
officers that provide for indemnification unless the indemnitee's conduct is
finally adjudged by a court to be knowingly fraudulent, deliberately dishonest
or willful misconduct. The Registrant indemnifies other officers, employees or
agents provided such persons acted in good faith and in a manner which they
reasonably believed to be in or not opposed to the best interest of the
Registrant or, with respect to criminal actions, had no reason to believe was
unlawful.
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
The following exhibits are filed herewith except those indicated which have
been filed previously as shown below and which are incorporated herein by
reference.
2.1 Agreement and Plan of Merger dated as of July 19, 1995, between Premier
Bancorp, Inc., Premier Acquisition Corporation and the Registrant.
2.2 First Amendment to Agreement and Plan of Merger dated as of September 7,
1995 by and among Premier Bancorp, Inc., Premier Acquisition Corporation
and the Registrant.
3.1 Amended Articles of Incorporation of the Registrant (incorporated by
reference from Exhibit 3.1 of the Annual Report of the Registrant on Form
10-K for the year ended December 31, 1991).
3.2 Code of Regulations of the Registrant (incorporated by reference from
Exhibit 3.2 of the Annual Report of the Registrant on Form 10-K for the
year ended December 31, 1991).
4.1 Form of Common Stock Certificate of the Registrant (incorporated by
reference from Exhibit 4.1 to the Annual Report of the Registrant on Form
10-K for the year ended December 31, 1989).
5 Opinion of Steven Alan Bennett, Esq., General Counsel for the Registrant,
regarding the legality of securities being offered, including consent.
8 Opinion of Coopers & Lybrand L.L.P. regarding the Federal income tax
consequences of the Merger, including consent.
23.1 Consent of Coopers & Lybrand L.L.P. relating to the opinion filed as
Exhibit 8 (included in Exhibit 8 hereto.)
23.2 Consent of Coopers & Lybrand L.L.P. relating to the audited financial
statements of the Registrant.
23.3 Consent of KPMG Peat Marwick LLP relating to the audited financial
statements of Premier Bancorp, Inc.
23.4 Consent of Steven Alan Bennett, Esq., General Counsel for the Registrant
(included in Exhibit 5 hereto).
23.5 Consent of Merrill Lynch, Pierce, Fenner & Smith Incorporated.
24 Powers of Attorney (included elsewhere in Part II of this Registration
Statement).
99.1 Form of Proxy to be used by Premier Bancorp, Inc.
II-1
<PAGE>
ITEM 22. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement: (i) to include any
prospectus required by Section 10(a)(3) of the Securities Act of 1933; (ii) to
reflect in the prospectus any facts or events arising after the effective date
of the registration statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate, represent a fundamental
change in the information set forth in the registration statement
(notwithstanding the foregoing, any increase or decrease in volume of
securities offered (if the total dollar value of securities offered would not
exceed that which was registered) and any deviation from the low or high end
of the estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in the
aggregate, the changes in volume and price represent no more than a 20% change
in the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement); and (iii) to
include any material information with respect to the plan of distribution not
previously disclosed in the registration statement or any material change to
such information in the registration statement.
(2) That, for the purpose 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.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of
the offering.
(4) 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 that is
incorporated by reference in this 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.
(5) 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 registrant 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.
(6) That every prospectus (i) that is filed pursuant to paragraph (5) above,
or (ii) that purports to meet the requirements of Section 10(a)(3) of the
Securities Act of 1933 and is used in connection with an offering of
securities subject to Rule 415, will be filed as a part of an amendment to
this registration statement and will not be used until such amendment has
become effective, and that for the purpose of determining liabilities 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.
(7) 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
Securities Act of 1933 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 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.
II-2
<PAGE>
(8) To respond to requests for information that is incorporated by reference
into the prospectus pursuant to Items 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.
(9) 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 this registration statement when
it became effective.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing this Registration Statement and has duly caused this
Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Columbus, State of Ohio, on October
5, 1995.
BANC ONE CORPORATION
By: /s/ Roman J. Gerber
---------------------------
Roman J. Gerber Executive Vice
President
POWER OF ATTORNEY
We, the undersigned officers and directors of BANC ONE CORPORATION, hereby
severally constitute and appoint William P. Boardman, Roman J. Gerber, William
C. Leiter, George R. L. Meiling or Michael J. McMennamin and each of them our
true and lawful attorneys-in-fact and agents, with full power of substitution
and resubstitution, for us and in our stead, in any and all capacities, to
sign any and all amendments (including post-effective amendments) to this
Registration Statement and all documents relating thereto, and any subsequent
registration statement filed by BANC ONE CORPORATION pursuant to Rule 462(b)
of the Securities Act of 1933, and to file the same, with all exhibits
thereto, and other documents in connection therewith, with the Securities and
Exchange Commission granting unto said attorneys-in-fact and agents, and each
of them, full power and authority to do and perform each and every act and
thing necessary or advisable to be done in and about the premises, as fully to
all intents and purposes as he might or could do in person, hereby ratifying
and confirming all that said attorneys-in-fact and agents, or any of them, or
their substitute or substitutes, may lawfully do or cause to be done by virtue
hereof.
WITNESS our hands and common seal on the dates set forth below.
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 DATES INDICATED:
Signature Title Date
--------- ----- ----
/s/ John B. McCoy Chairman of the Board October 5, 1995
- ------------------------- (Principal Executive Officer
John B. McCoy and Director)
/s/ Richard J. Lehmann President and Director October 5, 1995
- -------------------------
Richard J. Lehmann
/s/ Michael J. McMennamin Executive Vice President October 5, 1995
- ------------------------- (Principal Financial Officer)
Michael J. McMennamin
/s/ William C. Leiter Controller (Principal October 5, 1995
- ------------------------- Accounting Officer)
William C. Leiter
/s/ Charles E. Exley Director October 5, 1995
- -------------------------
Charles E. Exley
II-4
<PAGE>
Signature Title Date
--------- ----- ----
/s/ E. Gordon Gee Director October 5, 1995
- ------------------------------
E. Gordon Gee
/s/ John R. Hall Director October 5, 1995
- ------------------------------
John R. Hall
/s/ Laban P. Jackson, Jr. Director October 5, 1995
- ------------------------------
Laban P. Jackson, Jr.
/s/ John G. McCoy Director October 5, 1995
- ------------------------------
John G. McCoy
/s/ Richard L. Scott Director October 5, 1995
- ------------------------------
Richard L. Scott
/s/ Thekla R. Shackelford Director October 5, 1995
- ------------------------------
Thekla R. Shackelford
/s/ Alex Shumate Director October 5, 1995
- ------------------------------
Alex Shumate
/s/ Frederick P. Stratton, Jr. Director October 5, 1995
- ------------------------------
Frederick P. Stratton, Jr.
/s/ Robert D. Walter Director October 5, 1995
- ------------------------------
Robert D. Walter
II-5
<PAGE>
EXHIBIT INDEX
Exhibit 2.1 Agreement and Plan of Merger dated as of July 19, 1995, by and
among Premier Bancorp, Inc., Premier Acquisition Corporation and
the Registrant.
Exhibit 2.2 First Amendment to Agreement and Plan of Merger dated as of
September 7, 1995 by and among Premier Bancorp, Inc., Premier
Acquisition Corporation and the Registrant.
Exhibit 5 Opinion of Steven Alan Bennett, Esq., General Counsel for the
Registrant, regarding the legality of securities being offered,
including consent.
Exhibit 8 Opinion of Coopers & Lybrand L.L.P. regarding the Federal income
tax consequences of the Merger, including consent.
Exhibit 23.2 Consent of Coopers & Lybrand L.L.P. relating to the audited
financial statements of the Registrant.
Exhibit 23.3 Consent of KPMG Peat Marwick LLP relating to the audited
financial statements of Premier Bancorp, Inc.
Exhibit 23.5 Consent of Merill Lynch, Pierce, Fenner & Smith Incorporated.
Exhibit 99.1 Form of Proxy to be used by Premier Bancorp, Inc.
<PAGE>
Exhibit 2.1
AGREEMENT and PLAN OF MERGER
between
PREMIER BANCORP, INC.
and
PREMIER ACQUISITION CORPORATION
and
BANC ONE CORPORATION
<PAGE>
TABLE OF CONTENTS TO MERGER AGREEMENT
-------------------------------------
<TABLE>
<CAPTION>
Page
----
<S> <C>
RECITALS
Section 1. Merger............................................... 2
Section 2. Name................................................. 2
Section 3. Business............................................. 2
Section 4. Effective Time of Merger; Articles of Incorporation.. 3
Section 5. Effect of Merger..................................... 3
Section 6. Liabilities upon Merger; Service of Process.......... 4
Section 7. Conversion of Shares................................. 5
Section 8. Board of Directors; Employees; and Name Change....... 9
Section 9. Employee Benefits and Stock Options.................. 9
Section 10. Undertakings of the Parties.......................... 10
Section 11. Tax Opinion.......................................... 18
Section 12. Representations and Warranties of BANC ONE........... 19
Section 13. Representations and Warranties of PAC................ 31
Section 14. Representations and Warranties of PREMIER............ 33
Section 15. Action by PREMIER Pending Effective Time............. 48
Section 16. Action by BANC ONE Pending Effective Time............ 52
Section 17. Conditions to Obligations of BANC ONE and PAC........ 54
Section 18. Conditions to Obligations of PREMIER................. 57
Section 19. Conditions to Obligations of All Parties............. 60
Section 20. Indemnification...................................... 61
Section 21. Non-Survival of Representations and Warranties....... 64
Section 22. Governing Law........................................ 65
Section 23. Assignment........................................... 65
Section 24. Satisfaction of Conditions; Termination.............. 65
Section 25. Waivers; Amendments.................................. 69
Section 26. Entire Agreement and 1992 Agreement.................. 69
Section 27. Captions; Counterparts............................... 70
Section 28. Notices.............................................. 70
SIGNATURES....................................................... 72
</TABLE>
EXHIBIT A - PREMIER Subsidiaries List
EXHIBIT B - Form of Affiliates Agreement
EXHIBIT C - Opinion of Counsel for PREMIER
EXHIBIT D - Opinion of Counsel for BANC ONE and PAC
<PAGE>
AGREEMENT AND PLAN OF MERGER
----------------------------
AGREEMENT AND PLAN OF MERGER dated as of July 19, 1995 (hereinafter called the
"Merger Agreement"), between Premier Bancorp, Inc. (hereinafter called
"PREMIER"), Premier Acquisition Corporation (hereinafter called "PAC") and BANC
ONE CORPORATION (hereinafter called "BANC ONE").
WITNESSETH:
PREMIER is a corporation duly organized under the laws of the State of
Louisiana. Its principal office is located at 451 Florida Street, Baton Rouge,
East Baton Rouge Parish, Louisiana. Except as set forth in Exhibit A hereto,
---------
PREMIER, or a subsidiary of PREMIER, owns, beneficially and of record, all of
the issued and outstanding capital stock of the banks listed in Exhibit A hereto
---------
(the "Banks") and of the corporations and limited liability companies listed in
Exhibit A hereto (collectively the "Companies"). The Banks and the Companies
- ---------
are hereinafter sometimes referred to collectively as the "Subsidiaries" and
each, sometimes, as a "Subsidiary."
PAC is a corporation duly organized under the laws of the State of Ohio. Its
principal office is located at 100 East Broad Street, Columbus, Franklin County,
Ohio.
BANC ONE is a corporation duly organized under the laws of the State of Ohio.
Its principal office is located at 100 East Broad Street, Columbus, Franklin
County, Ohio.
The respective Boards of Directors of PREMIER, PAC, and BANC ONE have each
approved this Merger Agreement and the consummation of the transactions
contemplated hereby and have approved the execution and delivery of this Merger
Agreement. This Merger Agreement provides for the merger of PREMIER with and
into PAC upon the terms and conditions of this Merger Agreement (the "Merger").
PAC will be the surviving corporation of the Merger. From and after the time
the Merger shall become effective as set forth in Section 4 of this Merger
Agreement,
- 1 -
<PAGE>
and as and when required by this Merger Agreement, BANC ONE will issue shares of
its common stock, without par value ("BANC ONE Common") in exchange for all of
the issued and outstanding shares of PREMIER common stock, without par value,
$5.00 stated value ("PREMIER Common"). It is understood by each of the parties
hereto that BANC ONE seeks, as a result of the Merger, to acquire PREMIER, the
Banks and the Companies and all of their respective operating assets and
liabilities. Subject to the terms and conditions of this Merger Agreement, all
parties will exert their best efforts to obtain such regulatory approvals and to
effect such other actions as are necessary or appropriate to consummate the
Merger.
In consideration of the premises, PREMIER, BANC ONE and PAC hereby make this
Merger Agreement and prescribe the terms and conditions of the Merger and the
mode of carrying the Merger into effect as follows:
1. Merger. Subject to the terms and conditions hereinafter set forth,
------
PREMIER shall be merged with and into PAC pursuant to and in accordance
with applicable provisions of the Louisiana Business Corporation Law (the
"Louisiana BCL") and the General Corporation Law of the State of Ohio (the
"Ohio GCL"), with the result that PAC shall be the surviving corporation.
2. Name. The name of the surviving corporation (hereinafter called the
----
"Surviving Corporation" whenever reference is made to it as of the
Effective Time or thereafter) shall be "Banc One Louisiana Corporation."
3. Business. The business of the Surviving Corporation shall be that of a
--------
bank holding company. The Surviving Corporation shall exist by virtue of,
and be governed by the laws of, the State of Ohio and shall have its
principal office at 451 Florida Street, Baton Rouge, Louisiana.
- 2 -
<PAGE>
4. Effective Time of Merger; Articles of Incorporation. Certificates of Merger
---------------------------------------------------
shall be executed and filed with the Ohio Secretary of State and the
Louisiana Secretary of State pursuant to applicable provisions of the Ohio
GCL and the Louisiana BCL in order to cause the Merger to become effective
as soon as possible after the Closing (as defined in Section 10(c)). The
Merger shall become effective in accordance with applicable provisions of
the Ohio GCL and the Louisiana BCL on the later to occur of (i) the filing
with the Secretary of State of the State of Ohio of a Certificate of Merger
pursuant to Section 1701.81 of the Ohio GCL and (ii) the filing with the
Secretary of State of the State of Louisiana of a Certificate of Merger
pursuant to Section 12:112(F) of the Louisiana Revised Statutes (the
"Effective Time").
The Articles of Incorporation of PAC in effect as of the Effective Time
shall be the Articles of Incorporation of the Surviving Corporation, except
that Article FIRST of said Articles of Incorporation shall be amended,
effective as of the Effective Time, to be and read as follows:
FIRST: The name of this Corporation (hereinafter called the "Corporation")
-----
is Banc One Louisiana Corporation.
The Code of Regulations of PAC in effect as of the Effective Time shall be
the Code of Regulations of the Surviving Corporation.
5. Effect of Merger. At the Effective Time, the separate corporate existence
----------------
of PREMIER and PAC, respectively, shall, as provided in applicable
provisions of the Ohio GCL and the Louisiana BCL, be merged into and
continued in PAC as the Surviving Corporation, which shall be deemed to be
the same corporation as PREMIER and PAC. All rights, franchises and
interests of PREMIER and PAC, respectively, in and to every type of
property, real, personal and mixed, and choses in action, shall be
transferred to and vested in PAC as the Surviving Corporation by virtue of
the Merger without any deed or other
- 3 -
<PAGE>
transfer in the same manner and to the same extent as such rights,
franchises and interests were held or enjoyed by PREMIER and PAC,
respectively, at the Effective Time, as provided in applicable provisions of
the Ohio GCL and the Louisiana BCL; provided, however, that with respect to
any real property of PREMIER situated in the State of Louisiana,
Certificates of Merger must be filed in the parishes in which such real
estate is situated in order to reflect transfer of such properties to the
Surviving Corporation.
6. Liabilities upon Merger; Service of Process. The Surviving Corporation
-------------------------------------------
shall be responsible for all of the liabilities of every kind and
description of PREMIER and PAC existing as of the Effective Time.
The filing of a Certificate of Merger with the Secretary of State of the
State of Louisiana, accompanied by such other documents as are required by
the Louisiana BCL, shall operate as a consent by the Surviving Corporation
that it may be sued and served with process in the State of Louisiana in any
suit, action or proceeding for the enforcement of any obligation or
liability of PREMIER; as an irrevocable consent by the Surviving Corporation
to service upon and by the Louisiana Secretary of State as agent of the
Surviving Corporation to accept service of process in any such suit, action
or proceeding for the enforcement of any such obligation or liability; and
as an appointment by the Surviving Corporation of James H. Napper, II whose
address is 451 Florida Street, Baton Rouge, Louisiana 70801, as agent of the
Surviving Corporation for service of process in any action, suit or
proceeding to enforce any such obligation or liability of PREMIER, to whom
the Louisiana Secretary of State may mail a copy of any such process served
upon the Louisiana Secretary of State.
- 4 -
<PAGE>
7. Conversion of Shares.
--------------------
(a) At the Effective Time:
(i) Each share of PREMIER Common that is issued and outstanding
immediately prior to the Effective Time, together with any and all
PREMIER Common Stock purchase rights and related interests and
rights associated with each such share of PREMIER Common
("Rights") arising from, related to and/or issued pursuant to the
Rights Agreement dated January 18, 1989 between PREMIER and
Premier Bank, N.A., as Rights Agent (the PREMIER Rights Plan"), by
virtue of the Merger and without any action of the part of the
holder thereof shall thereupon be converted into 0.617761 share of
BANC ONE Common subject, however, to (i) the anti-dilution
provisions of Section 7(e) of this Merger Agreement and (ii)
provisions set forth in Section 7(c) with respect to fractional
shares (the "Exchange Rate").
(ii) The 500 shares of Common Stock of PAC issued and outstanding
immediately prior to the Effective Time shall, thereupon and
without further notice, continue to be issued and outstanding
shares of common stock of the Surviving Corporation.
(iii) Any shares of PREMIER Common held by PREMIER as treasury stock,
together with any and all Rights associated therewith arising
from, related to and/or issued pursuant to the PREMIER Rights
Plan, immediately prior to the Effective Time shall be canceled
and shall not represent capital stock of and/or any right or
interest with respect to BANC ONE or the Surviving Corporation and
shall not be exchanged for shares of BANC ONE Common.
- 5 -
<PAGE>
(iv) The Rights issued pursuant to the PREMIER Rights Plan shall
expire and neither the Surviving Corporation nor BANC ONE shall
have any obligations with respect thereto.
(b) PREMIER's shareholders of record at the Effective Time, for the shares
of PREMIER Common then held by them, respectively, shall be allocated
and be entitled to receive (upon surrender for cancellation of
certificates formerly representing shares of PREMIER Common and Rights
issued pursuant to the PREMIER Rights Plan) certificates for shares of
BANC ONE Common as shall be equal to the number of shares of PREMIER
Common outstanding immediately prior to the Effective Time multiplied
by the Exchange Rate.
(c) No certificate for fractional shares of BANC ONE Common will be issued
by BANC ONE in connection with the exchange contemplated by the Merger,
but in lieu thereof, any holder of PREMIER Common shall, upon surrender
of the certificate or certificates representing such PREMIER Common and
Rights issued pursuant to the PREMIER Rights Plan, be paid cash,
without interest, by BANC ONE for such fractional shares, if any, on
the basis of the BANC ONE Average Price (as hereinafter defined). The
BANC ONE Average Price shall mean the average of the closing prices of
BANC ONE Common on the New York Stock Exchange ("NYSE") during the
Valuation Period (as hereinafter defined) as reported in
The Wall Street Journal for NYSE Composite Transactions. The term
-----------------------
"Valuation Period" shall mean the ten consecutive NYSE trading days
ending on the eighth NYSE trading day immediately prior to the Closing
Date .
(d) As soon as practicable after the Effective Time, and subject to the
provisions set forth above relating to fractional shares, BANC ONE
will, or will cause Harris Trust and Savings Bank, as Exchange Agent
for BANC ONE to, distribute to the former holders of PREMIER Common (or
their respective designees) in exchange
- 6 -
<PAGE>
for and upon surrender for cancellation by such holders of a
certificate or certificates formerly representing shares of PREMIER
Common and Rights issued pursuant to the PREMIER Rights Plan, the
certificate(s) for shares of BANC ONE Common in accordance with the
Exchange Rate. Each certificate formerly representing PREMIER Common
and Rights issued pursuant to the PREMIER Rights Plan shall be deemed
for all purposes to evidence the ownership of the number of shares of
BANC ONE Common into which such shares have been converted pursuant to
the Exchange Rate; provided, however, that, until such surrender of a
holder's certificate or certificates formerly representing shares of
PREMIER Common and Rights issued pursuant to the PREMIER Rights Plan,
the holder thereof shall not be entitled to receive any dividend or
other payment or distribution payable to holders of BANC ONE Common.
Upon such surrender (or, in lieu of surrender, other provisions
reasonably satisfactory to BANC ONE as are made as set forth in the
next following paragraph), there shall be paid to the person entitled
thereto the aggregate amount of dividends or other payments or
distributions (in each case without interest) which became payable
after the Effective Time, to the extent not previously paid to such
person, on the whole shares of BANC ONE Common represented by the
certificates issued upon such surrender and exchange or in accordance
with such other provisions, as the case may be. After the Effective
Time the holders of certificates formerly representing shares of
PREMIER Common and Rights issued pursuant to the PREMIER Rights Plan
shall cease to have rights with respect to such shares and to any
related Rights and their sole right shall be to exchange said
certificates for shares of BANC ONE Common and any fractional share
payment in accordance with this Merger Agreement.
Certificates formerly representing shares of PREMIER Common and Rights
issued pursuant to the PREMIER Rights Plan surrendered for cancellation
by each shareholder entitled to exchange such shares for shares of BANC
ONE Common
- 7 -
<PAGE>
shall be accompanied by such appropriate, executed letters of
transmittal as BANC ONE may reasonably require; provided, however, that
if there be delivered to BANC ONE by any person who is unable to
produce any such certificate formerly representing shares of PREMIER
Common and Rights issued pursuant to the PREMIER Rights Plan for
surrender (i) evidence to the reasonable satisfaction of BANC ONE that
any such certificate has been lost, wrongfully taken or destroyed, and
(ii) such security or indemnity as reasonably may be requested by BANC
ONE to save it harmless, and (iii) evidence to the reasonable
satisfaction of BANC ONE that such person is the owner of the shares
theretofore represented by each certificate claimed by him to be lost,
wrongfully taken or destroyed and that he is the person who would be
entitled to present each such certificate and to receive shares of BANC
ONE Common pursuant to this Merger Agreement, then BANC ONE, in the
absence of actual notice to it that any shares theretofore represented
by any such certificate have been acquired by a bona fide purchaser,
shall deliver to such person the certificate(s) representing shares of
BANC ONE Common (and any fractional share payment) which such person
would have been entitled to receive upon surrender of each such lost,
wrongfully taken or destroyed certificate representing shares of
PREMIER Common.
(e) If prior to the Effective Time, (i) PREMIER shall declare a stock
dividend or distribution upon or subdivide, split up, reclassify or
combine PREMIER Common or declare a dividend, or make a distribution,
on PREMIER Common in any security convertible into PREMIER Common or
(ii) BANC ONE shall declare a stock dividend or distribution upon or
subdivide, split up, reclassify or combine BANC ONE Common or declare a
dividend, or make a distribution, on BANC ONE Common in any security
convertible into BANC ONE Common, appropriate adjustment or adjustments
will be made in the Exchange Rate and other factors used to determine
or limit the Exchange Rate.
- 8 -
<PAGE>
8. Board of Directors, Employees and Name Changes. The directors of PREMIER
----------------------------------------------
immediately prior to the Effective Time shall serve as the directors of the
Surviving Corporation immediately following the Effective Time and until the
next annual meeting of shareholders at which their respective successors are
elected and qualified. The officers and employees of the Surviving
Corporation immediately following the Effective Time shall be the officers
and employees of PREMIER immediately before the Effective Time with each
such person to hold the same office in the Surviving Corporation as held by
such person in PREMIER. The directors, officers and employees of the
Subsidiaries immediately following the Effective Time shall be the officers
and employees of the respective Subsidiaries immediately before the
Effective Time. Subject to a review of the operations of PREMIER and its
Subsidiaries and to commercial conditions that exist as of the Effective
Time, it generally is the current intention of BANC ONE to retain the then
existing employees of PREMIER and the Subsidiaries.
PREMIER will cooperate with BANC ONE in the procurement of requisite
corporate and regulatory approvals and, if requested by BANC ONE, will use
its best efforts to take such other steps as are appropriate and necessary
to effect changes in the name of each of the Subsidiaries to include the
words "Bank One" or "Banc One" so that such name changes will become
effective at the Effective Time or such other time subsequent to the
Effective Time as may be requested by BANC ONE.
9. Employee Benefits and Stock Options. Following the Effective Time, the
-----------------------------------
stock options, if any, and employee benefit programs to be available and
applicable to the officers and employees of PREMIER and the Subsidiaries
shall be described in and governed by a Letter Agreement dated July 19, 1995
between PREMIER and BANC ONE (the "Benefits Agreement").
- 9 -
<PAGE>
10. Undertakings of the Parties. PREMIER, PAC and BANC ONE further agree as
---------------------------
follows:
(a) This Merger Agreement shall be submitted to the shareholders of PREMIER
for approval at a meeting to be called and held in accordance with
applicable law and the Articles of Incorporation and By-laws of
PREMIER. Such shareholders' meeting will be scheduled to be held at a
time mutually acceptable to PREMIER and BANC ONE approximately 30 to 45
days following the mailing by PREMIER of its proxy statement to its
shareholders, which mailing will promptly follow the effective date of
the registration statement to be filed by BANC ONE with the Securities
and Exchange Commission (the "SEC") as provided in Section 10(d).
PREMIER and BANC ONE will cooperate with each other in order to
facilitate the preparation, filing and clearance of the registration
statement and the proxy statement under federal and state securities
laws to be used with respect to such shareholders' meeting and the
exchange of shares as contemplated by this Merger Agreement. PREMIER's
obligation to submit this Merger Agreement to a vote at the
shareholders' meeting shall be subject to the receipt by PREMIER of the
opinion of Merrill Lynch, Pierce, Fenner & Smith, Incorporated, dated
as of a date not more than five days prior to the date of the Proxy
Statement/Prospectus with respect to the fairness of the transaction to
PREMIER's shareholders from a financial point of view satisfactory in
form and substance to PREMIER and its counsel.
(b) BANC ONE will promptly prepare and file an application (believed
in good faith by BANC ONE to be substantially complete in form and
substance) to the Board of Governors of the Federal Reserve System (the
"Board") under appropriate provisions of Section 3 and Section 4 of the
Bank Holding Company Act of 1956, as amended, and to the Louisiana
Commissioner of Financial Institutions (the "Commissioner") under
appropriate provisions of Louisiana Interstate Banking Law for prior
approval of the Merger or the proposed acquisition of PREMIER
- 10 -
<PAGE>
and/or one of more of the Subsidiaries by BANC ONE. PREMIER will
promptly furnish BANC ONE such information, appropriate representations
and documents as may be reasonably requested by BANC ONE in connection
therewith. BANC ONE will use its best efforts to cause such
applications to be approved by the Board and the Commissioner, and to
obtain such other regulatory consents and approvals as may be necessary
to facilitate the Merger, in each case as soon as possible. Before such
applications are filed, BANC ONE will provide PREMIER and its counsel
with an opportunity to promptly review drafts of all such applications
and to comment on the portions of such applications that contain
information about PREMIER. BANC ONE will promptly provide PREMIER and
its counsel with copies of all such applications as filed together with
correspondence to or from any such regulators related thereto.
(c) The closing of the Merger (the "Closing") shall, unless another date or
place is agreed to in writing by the parties hereto, take place at the
offices of BANC ONE, 100 East Broad Street, Columbus, Ohio 43271 on the
last business day of a month which first occurs on or after the later
of (i) the expiration of any required waiting period following the
approval of the consummation of the Merger by the Board and
Commissioner, (ii) the date of the meeting of shareholders of PREMIER
to approve the Merger or (iii) the business day following the
satisfaction or waiver of all conditions to the Merger. The date on
which the closing is held is herein referred to as the "Closing Date."
(d) BANC ONE will promptly prepare and file with the SEC and use its best
efforts to cause to become effective as soon as possible, a
registration statement, including the related prospectus, and including
the proxy statement referred to in Section 10(a), above (the "Proxy
Statement/Prospectus"), and any required amendments thereto or
supplements to any prospectus contained therein, relating to the
issuance of BANC ONE Common in the Merger as contemplated by this
Merger
- 11 -
<PAGE>
Agreement. Such registration statement will not cover resales by any
persons who may be considered "underwriters" under Rule 145(c) of the
Securities Act of 1933, as amended (the "1933 Act"). PREMIER and its
counsel shall assist BANC ONE in the preparation of the Proxy
Statement/Prospectus and BANC ONE will provide PREMIER and its counsel
with an opportunity to prepare material particularly related to PREMIER
and matters with respect to disclosing the background of the
transaction and reasons for the transaction. Before being filed with
the SEC, BANC ONE will provide PREMIER and its counsel with the
opportunity to promptly review such filing and comment thereon, which
comments BANC ONE will reasonably consider. BANC ONE will promptly
provide PREMIER and its counsel with copies of all SEC filings related
to the Proxy Statement/Prospectus and the Registration Statement
together with correspondence to or from the SEC related thereto. BANC
ONE shall use its best efforts to have the shares of BANC ONE Common
qualified or exempted from qualification under all applicable state
securities laws as soon as possible. In the event that a stop order has
been issued, or threatened, by the SEC, that suspends or would suspend
the effectiveness of the registration statement, BANC ONE shall use its
best efforts to promptly remove, or cause not to be issued, any such
stop order.
(e) BANC ONE will assume and pay, or will cause PAC to pay, all expenses
incident to the obtaining of the requisite regulatory consents and
approvals. Without limiting the generality of the foregoing, the
expenses to be assumed and paid by BANC ONE shall include (i) all legal
and other expenses and taxes incurred by BANC ONE incident to the
consummation of the Merger contemplated by this Merger Agreement, (ii)
all legal and other expenses incurred by BANC ONE incident to the
preparation and filing of the applications to the Board and the
Commissioner and other requests for regulatory consents and approvals
with the appropriate bank regulatory agencies as set forth in or
contemplated by this Merger Agreement, (iii) all legal and other
expenses, if any, incurred in connection
- 12 -
<PAGE>
with the registration of BANC ONE Common under federal and state
securities laws, and (iv) expenses associated with obtaining the tax
opinion contemplated by Section 11 of this Merger Agreement. The
expenses to be assumed and paid by BANC ONE shall not include any legal
or other expenses incurred by PREMIER in the negotiation of this Merger
Agreement, the examination or review of documents for its own benefit,
in connection with its own corporate proceedings or to Merrill Lynch,
Pierce, Fenner & Smith, Incorporated or to any other investment banker
or advisor for services rendered on its behalf. BANC ONE will pay the
expenses of reproducing the Proxy Statement/Prospectus. PREMIER shall
be responsible for its legal and accounting fees associated with the
Proxy Statement/Prospectus, including the expenses and fees to Merrill
Lynch, Pierce, Fenner & Smith, Incorporated with respect to any opinion
expressed with respect to the fairness of the Exchange Rate to the
holders of PREMIER Common.
(f) All information furnished by one party to another party in connection
with this Merger Agreement (whether before or after the date of this
Merger Agreement) and the transactions contemplated hereby which is
regarded by such furnishing party as confidential (and is so designated
not later than the time of delivery or the date of this Merger
Agreement) will be kept confidential by such other party and will be
used by such other party and its directors, officers, employees and
representatives of its advisors only in connection with this Merger
Agreement and the transactions contemplated hereby, except to the
extent that such information (i) is already known to such other party
when received, (ii) thereafter becomes lawfully obtainable from other
sources, otherwise than in violation of this paragraph or similar
duties or provisions regarding confidentiality, or (iii) is, in the
reasonable opinion of legal counsel for such other party, required to
be disclosed in any document filed with the SEC, the Board, the
Commissioner or any other governmental agency or authority.
- 13 -
<PAGE>
(g) Each of BANC ONE and PREMIER will provide the other with copies of all
filings it makes with the SEC under the Securities Exchange Act of
1934, as amended (the "1934 Act"), and the 1933 Act and the respective
rules and regulations of the SEC thereunder at the time such filings
are made at any time prior to the Effective Time. Insofar as any such
filing refers to or describes this Merger Agreement, the other party
hereto, or the transactions contemplated hereby, the filing party will
provide to the other party a draft thereof reasonably in advance of
making such filing, will provide the other party and its counsel
reasonable opportunity to comment on such filing and will give due
consideration to any comments of the other party and its counsel before
making such filing.
(h) BANC ONE and PAC will furnish to PREMIER all information concerning
BANC ONE and PAC reasonably required by PREMIER in connection with the
preparation of proxy solicitation materials for use in soliciting
proxies in connection with the meeting of PREMIER's shareholders called
for the purpose of voting on the Merger and will promptly advise
PREMIER if BANC ONE determines that any of such information is or
becomes false or misleading in any material respect. PREMIER will
furnish to BANC ONE all information concerning PREMIER and the
Subsidiaries reasonably required by BANC ONE in connection with BANC
ONE's preparation of the registration statement (including the related
prospectus) and any required amendments or supplements thereto, or in
connection with other filings by BANC ONE relating to the registration
of its shares to be issued in the Merger and will promptly advise BANC
ONE if PREMIER determines that any such information is or becomes false
or misleading in any material respect.
(i) No press release or other public disclosure of matters related to this
Merger Agreement or any of the transactions contemplated hereby shall
be made by PREMIER or BANC ONE unless the other party shall have
provided its prior
- 14 -
<PAGE>
consent to the form and substance thereof; provided, however, that
nothing herein shall be deemed to prohibit any party hereto from making
any disclosure which its counsel deems necessary or advisable in order
to fulfill such party's disclosure obligations imposed by law.
(j) As soon as possible after the execution of this Merger Agreement, BANC
ONE will vote all the shares of PAC to approve and adopt the proposal
to merge PREMIER with PAC at a meeting of the shareholders of PAC held
for such purpose or by means of a unanimous written consent of PAC's
shareholders adopted in lieu of a meeting to approve the Merger and
approve this Merger Agreement.
(k) BANC ONE will vote, and will cause its subsidiaries to vote, any shares
of PREMIER Common held by it or any such subsidiary, except for shares
held in a fiduciary capacity, to approve and adopt this Merger
Agreement and the Merger at a meeting of PREMIER shareholders held to
approve the Merger and adopt this Merger Agreement.
(l) For not less than the two-year period immediately following the
Effective Time, BANC ONE shall make available adequate current public
information about itself as that terminology is used in and as required
by Rule 144(c) of the SEC under the 1933 Act.
(m) PREMIER will use its reasonable best efforts to cause each person who,
in the joint opinion of counsel for BANC ONE and PREMIER, is at the
Effective Time or was, at the time of PREMIER's shareholders' meeting
referred to in Section 10 hereof, an "affiliate" of PREMIER (as that
term is used in Rules 144 and 145 promulgated by the SEC under the 1933
Act), to execute and deliver to BANC ONE a written agreement, in the
form of attached Exhibit B, that such person will
---------
- 15 -
<PAGE>
not sell, pledge, transfer or otherwise dispose of the shares of BANC
ONE Common to be received by such person in the Merger, except in
compliance with the applicable provisions of the 1933 Act.
(n) BANC ONE will initiate a pre-acquisition investigation and review of
the books, records and facilities of PREMIER and its Subsidiaries and
will complete such pre-acquisition investigation as soon as reasonably
possible but, in no event, not more than 60 days after the date of this
Merger Agreement. BANC ONE shall advise PREMIER at the conclusion of
such pre-acquisition investigation of all matters then known to BANC
ONE which are either (i) inconsistent in any material and adverse
respect with any of the representations and warranties of PREMIER
contained in this Merger Agreement or (ii), in the reasonable judgment
of the Board of Directors of BANC ONE, either (x) to be of such
significance as to materially and adversely affect the financial
condition or the results of operations of PREMIER and the Subsidiaries
on a consolidated basis or (y) to deviate materially and adversely from
PREMIER's audited financial statements for the year ended December 31,
1994 or PREMIER's unaudited financials for the three-month period ended
June 30, 1995. BANC ONE shall have the right to terminate this Merger
Agreement as set forth in Section 24(c).
(o) PREMIER will initiate a pre-acquisition investigation and review of the
books, records and facilities of BANC ONE and its subsidiaries and will
complete such pre-acquisition investigation not later than 10 business
days following the date of this Merger Agreement. PREMIER shall advise
BANC ONE at the conclusion of such pre-acquisition investigation of all
matters then known to PREMIER which are either (i) inconsistent in any
material and adverse respect with any of the representations and
warranties of BANC ONE contained in this Merger Agreement or (ii), in
the reasonable judgment of the Board of Directors of PREMIER, either
(x) to be of such significance as to materially and adversely affect
the financial
- 16 -
<PAGE>
condition or the results of operations of BANC ONE and the subsidiaries
on a consolidated basis or (y) to deviate materially and adversely from
BANC ONE's audited financial statements for the year ended December 31,
1994 or BANC ONE's unaudited financials for the three-month period
ended June 30, 1995. PREMIER shall have the right to terminate this
Merger Agreement as set forth in Section 24(d).
(p) BANC ONE will use its reasonable best efforts to cause the shares of
BANC ONE Common to be issued to the shareholders of PREMIER pursuant to
this Merger Agreement to be listed on the NYSE as of the Closing Date.
(q) PREMIER shall take all action, as necessary, with respect to the
PREMIER Rights Plan, to prevent the approval, execution, delivery or
implementation of this Merger Agreement or the consummation of the
Merger, or the acquisition of shares of PREMIER Common by BANC ONE
pursuant to the provisions of this Merger Agreement from resulting in
the grant, issuance or triggering of any right or entitlement or the
obligation to grant or issue any interest in PREMIER Common, BANC ONE
Common or the common stock of the Surviving Corporation to any person
under the PREMIER Rights Plan or enabling or allowing any Right or
other interest associated with the PREMIER Rights Plan to be exercised,
distributed or triggered.
(r) PREMIER shall take all reasonable action pursuant to the provisions of
The Premier Bancorp, Inc. 1991 Stock Option Plan (the "PREMIER Stock
Option Plan") and the stock option agreements related thereto to
encourage the holders of such options to exercise such options so that
prior to the Closing Date all such options will have been converted
into shares of PREMIER Common.
- 17 -
<PAGE>
(s) If at a time reasonably close to the anticipated Closing Date it
appears that options for shares of PREMIER Common issued to officers
and employees of PREMIER and the Subsidiaries related to the PREMIER
Stock Option Plan will not be exercised and converted into shares of
PREMIER Common prior to the Closing Date, BANC ONE will, prior to the
Effective Time, file with the SEC and use its reasonable best efforts
to cause to become effective not later than the Effective Time, a
registration statement on Form S-8 or other appropriate form to
register with the SEC the shares of BANC ONE Common which may be issued
to individuals upon the exercise of stock options assumed by BANC ONE
pursuant to the Benefits Agreement and will use its reasonable best
efforts to cause such registration statement to remain in effect until
the exercise or expiration of all such options and/or other stock-
related benefits. BANC ONE shall use its reasonable best efforts to
have the shares of BANC ONE Common which may be issued upon the
exercise of such options qualified or exempted from qualification from
all applicable state securities laws.
11. Tax Opinion. BANC ONE and PREMIER shall use their respective best
-----------
efforts to obtain from Coopers & Lybrand a written opinion addressed to
PREMIER, its shareholders and BANC ONE that, based upon the Internal Revenue
Code and regulations thereunder and rulings issued by the Internal Revenue
Service in transactions similar to those contemplated by this Merger
Agreement:
(a) The statutory Merger of PREMIER with and into PAC will constitute a
reorganization within the meaning of Section 368(a)(1)(A) and Section
368(a)(2)(D) of the Internal Revenue Code;
(b) No gain or loss will be recognized by BANC ONE or PREMIER as a
consequence of the transactions herein contemplated;
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<PAGE>
(c) No gain or loss will be recognized to the shareholders of PREMIER on
the exchange of their shares of PREMIER Common for shares of BANC ONE
Common (disregarding for this purpose any cash received in lieu of
fractional share interests);
(d) The Federal income tax basis of the BANC ONE Common received by the
shareholders of PREMIER Common for their shares of PREMIER Common will
be the same as the Federal income tax basis of the PREMIER Common
surrendered in exchange therefor (reduced by any amount allocated to
fractional share interests for which cash is received); and
(e) The holding period of the BANC ONE Common received by a shareholder of
PREMIER will include the period for which the PREMIER Common exchanged
therefor was held, provided the exchanged PREMIER Common was held as a
capital asset by such shareholder on the date of the exchange.
12. Representations and Warranties of BANC ONE. BANC ONE represents and
------------------------------------------
warrants to PREMIER that, except as set forth in BANC ONE's disclosure
letter to PREMIER dated as of July 19, 1995 and delivered to PREMIER not
later than the time of the execution of this Merger Agreement (the "BANC ONE
Disclosure Letter"):
(a) BANC ONE is a corporation duly organized and validly existing in good
standing under the laws of the State of Ohio, is a registered bank
holding company under the Bank Holding Company Act of 1956, as amended,
and is qualified to do business and is in good standing in the State of
Ohio, together with all other jurisdictions where it is both required
to so qualify and where the failure to so qualify would have a material
adverse effect on the business, operations, financial condition or
results of operations of BANC ONE and its subsidiaries, taken as a
whole, or on the ability of BANC ONE to consummate the transactions
- 19 -
<PAGE>
contemplated hereby (a "BANC ONE Material Adverse Effect"), and BANC
ONE has full power and authority (including all licenses, franchises,
permits and other governmental authorizations which are legally
required) to engage in the businesses and activities now conducted by
it and its subsidiaries. BANC ONE is not subject to any formal or
informal agreement or understanding with, nor is it subject to any
order of, any bank regulatory authority restricting or prohibiting or
attempting to restrict or prohibit any activities or conduct of BANC
ONE. Subject only to obtaining the required regulatory approvals, BANC
ONE is, and at all times after the date of this Merger Agreement to and
including the Effective Time will be, authorized to effect the Merger
under applicable law. As of March 31, 1995, the authorized capital
stock of BANC ONE consisted of (i) 600,000,000 shares of BANC ONE
Common, of which a total of 394,378,724 shares were issued and
outstanding and 15,630,500 were held by BANC ONE as treasury stock and
(ii) 35,000,000 shares of preferred stock without par value, of which
4,997,999 shares were issued and outstanding as Series C $3.50
Cumulative Convertible Preferred Stock. All of the issued and
outstanding shares of BANC ONE's capital stock are duly authorized,
validly issued, fully paid, nonassessable and subject to no pre-emptive
rights. Since March 31, 1995 BANC ONE has issued approximately 412,000
additional shares of BANC ONE Common and has issued no additional
shares of preferred stock.
(b) BANC ONE has furnished to PREMIER copies of the following financial
statements relating to BANC ONE and its consolidated subsidiaries: (i)
the audited Consolidated Balance Sheets of BANC ONE as of December 31,
1994 and 1993 and the Consolidated Statements of Income, Shareholders'
Equity and Cash Flows for each of the years in the three-year period
ended December 31, 1994, together with the notes thereto, as audited by
Coopers & Lybrand, independent auditors as included in BANC ONE's
Annual Report on Form 10-K for the year ended December 31, 1994 as
filed with the SEC; and (ii) the unaudited
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<PAGE>
Consolidated Balance Sheet of BANC ONE as at March 31, 1995 and the
related unaudited Consolidated Statements of Income, Shareholders'
Equity and Cash Flows for the quarter then ended, together with the
notes thereto as included in BANC ONE's Quarterly Report on Form 10-Q
for the quarter ended March 31, 1995, as filed with the SEC. Each of
the aforementioned financial statements, and all financial statements
included in Form 10-K or Forms 10-Q filed with the SEC subsequent to
the date of this Merger Agreement and prior to the Effective Time will,
present fairly, in accordance with generally accepted accounting
principles (applied on a consistent basis except as disclosed in the
footnotes thereto), the consolidated financial position and results of
operations of BANC ONE as of the dates and for the periods therein set
forth. Such financial statements do not or will not, as of the dates
thereof, include any material asset or omit any material liability,
absolute or contingent, or other fact, the inclusion or omission of
which renders or would render such financial statements, in light of
the circumstances under which they were made, misleading in any
material respect. Since March 31, 1995, there has not been any change
in the financial condition, results of operations or business of BANC
ONE and its subsidiaries that has had a BANC ONE Material Adverse
Effect.
(c) Since December 31, 1991, BANC ONE and each of its subsidiaries has
filed all reports, registrations and statements, together with any
required amendments thereto, that any of them was required to file with
(i) the SEC, including, but not limited to, all Forms 10-K, Forms 10-Q,
Forms 8-K, annual reports and proxy statements, (ii) the Board, (iii)
the Federal Deposit Insurance Corporation (the "FDIC"), (iv) the Office
of the Comptroller of the Currency (the "OCC") and (v) any applicable
state securities or banking authorities. All such reports and
statements filed (and to be filed in the future) with any such
regulatory body or authority are collectively referred to in this
Merger Agreement as the "Reports." As of their respective dates, the
Reports complied or, if filed in the future, will
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<PAGE>
comply, in all material respects with the respective rules and
regulations promulgated by the SEC, the Board, the FDIC, the OCC and
state securities or banking authorities, and did not contain at the
time filed, and all Reports to be filed after the date hereof and prior
to the Effective Time will not contain at the time filed, 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 under which they were made, not
misleading.
(d) The Boards of Directors of BANC ONE and PAC have duly authorized the
execution and delivery of this Merger Agreement and approved the Merger
as contemplated by this Merger Agreement. No authorization of this
Merger Agreement or of the transactions hereby contemplated is required
by the shareholders of BANC ONE. BANC ONE and PAC have all requisite
power and authority to enter into this Merger Agreement and BANC ONE
has and, after BANC ONE's vote of the shares of PAC in favor of the
Merger as contemplated by Section 10(j), BANC ONE and PAC will have the
corporate authority to consummate the transactions contemplated hereby.
Subject, with respect to PAC, to approval by BANC ONE as PAC's sole
shareholders, this Merger Agreement constitutes the valid and legally
binding and enforceable obligation of each of BANC ONE and PAC, and
this Merger Agreement and the consummation of the Merger have been duly
authorized and approved on behalf of BANC ONE and PAC by all requisite
corporate action. Neither the execution and delivery of this Merger
Agreement nor, provided the required approvals are obtained from the
Board and the Commissioner, the consummation of the Merger will
conflict with, result in the breach of, constitute a default under or
accelerate the performance provided by the terms of any law, or any
rule or regulation of any governmental agency or authority or any
judgment, order or decree of any court, bank regulatory agency or other
governmental agency to which BANC ONE is subject, any contract,
agreement or instrument to which BANC ONE is a party or by which
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<PAGE>
BANC ONE is bound or committed, or the Articles of Incorporation or
Code of Regulations of BANC ONE, or constitute an event which with the
lapse of time or action by a third party, could result in a default
under any of the foregoing or result in the creation of any lien,
charge or encumbrance upon any of the assets or properties of BANC ONE
or upon any of the stock of BANC ONE or adversely affect the ability of
BANC ONE to consummate the transactions contemplated hereby, except, in
the case of contracts, agreements or instruments, such defaults,
conflicts or breaches which either (i) will be cured or waived prior to
the Effective Time or (ii) if not so cured or waived would not, in the
aggregate, have a BANC ONE Material Adverse Effect.
(e) The reserve for possible loan and lease losses shown on the March 31,
1995 Consolidated Balance Sheet of BANC ONE is adequate in all material
respects under the requirements of generally accepted accounting
principles to provide for possible losses, net of recoveries relating
to loans previously charged off, on loans outstanding (including,
without limitation, accrued interest receivable) as of March 31, 1995.
(f) Except as disclosed in the financial statements referred to in Section
12(b), there is no litigation, action, suit, investigation or
proceeding pending or, to the best of the knowledge of BANC ONE and its
executive officers after due inquiry, overtly threatened against or
affecting BANC ONE or any of its subsidiaries or involving any of their
respective properties or assets, at law or in equity, before any
federal, state, municipal, local or other governmental authority, which
is reasonably likely to be resolved adversely to the interest of BANC
ONE or its subsidiaries and, if so resolved, would have a BANC ONE
Material Adverse Effect or materially impair its ability to perform
under this Merger Agreement, and to the best of the knowledge of BANC
ONE and its executive officers after due inquiry, no one has reasonable
or valid grounds on which it reasonably can be expected that anyone
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will assert or initiate any such litigation, action, suit,
investigation or proceeding against BANC ONE or any of its
subsidiaries.
(g) At the Effective Time and on such subsequent dates when the former
shareholders of PREMIER surrender their PREMIER share certificates for
cancellation and exchange, the shares of BANC ONE Common to be
exchanged with former shareholders of PREMIER will have been duly
authorized and validly issued by BANC ONE and will be fully paid and
nonassessable and subject to no pre-emptive rights.
(h) BANC ONE and each of its subsidiaries have good and marketable title to
all their respective assets and properties, whether real or personal,
tangible or intangible, including without limitation the capital stock
of its subsidiaries and all other assets and properties reflected in
BANC ONE's Consolidated Balance Sheet as of March 31, 1995 or which
would be reflected thereon if not fully amortized or depreciated or
acquired subsequent thereto (except to the extent that such assets and
properties have been disposed of for fair value in the ordinary course
of business since March 31, 1995). Such assets and properties are
subject to no liens, mortgages, security interests, encumbrances,
pledges or charges of any kind, except (i) as noted in said
Consolidated Balance Sheet or the notes thereto or, with respect to
assets and properties acquired after March 31, 1995, as noted in BANC
ONE's Consolidated Balance Sheet or the notes thereto included in a
periodic report filed with the SEC; (ii) statutory liens for taxes not
yet delinquent; (iii) landlord's liens; and (iv) minor defects and
irregularities in title and encumbrances which do not materially impair
the use thereof for the purposes for which they are held; and such
liens, mortgages, security interests, encumbrances and charges do not,
in the aggregate, have a BANC ONE Material Adverse Effect. BANC ONE and
its subsidiaries as lessees have the unqualified right under valid and
subsisting leases to occupy, use, possess and control all property
leased by BANC ONE and
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<PAGE>
its subsidiaries. At the Effective Time all limitations affecting such
properties will not, in the aggregate, have a BANC ONE Material Adverse
Effect.
(i) To the best of the knowledge of BANC ONE and its executive officers
after due inquiry, BANC ONE and its subsidiaries have complied with all
laws, regulations and orders applicable to them and to the conduct of
their businesses, including without limitation all statutes, rules and
regulations pertaining to the conduct of banking activities, except for
violations which, together with any penalty which results therefrom,
have not had and will not have a BANC ONE Material Adverse Effect.
Neither BANC ONE nor any of its subsidiaries is in default under, and
no event has occurred which, to the best of the knowledge of BANC ONE
and its executive officers, after due inquiry, is likely to result in a
default under the terms of any judgment, decree, order, writ, rule or
regulation of any governmental authority or court, whether federal,
state or local and whether at law or in equity, in each case where the
default has had or is likely to have a BANC ONE Material Adverse
Effect.
(j) BANC ONE and PAC have not incurred and will not incur directly or
indirectly any liability for brokerage, finders' or investment bankers'
fees or commissions in connection with this Merger Agreement or the
transactions contemplated hereby.
(k) Each pension, stock bonus or purchase, profit-sharing, retirement,
health and welfare plan maintained by or covering employees of BANC ONE
or any subsidiary of BANC ONE other than a multi employer plan (for
purposes of this paragraph hereinafter referred to collectively as the
"Plans") which purports to be a qualified plan under Section 401(a) of
the Code is so qualified. All of the Plans which constitute employee
pension benefit or employee welfare benefit plans subject to the
Employee Retirement Income Security Act of 1974, as amended
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<PAGE>
("ERISA"), have been maintained in compliance in all material respects
with the applicable requirements of ERISA. All material notices,
reports and other filings required under applicable law to be given or
made to or with any governmental agency with respect to the Plans have
been timely filed or delivered. BANC ONE and its executive officers,
after due inquiry, have no knowledge of (i) any circumstances which
would adversely affect the qualification of the Plans or their
compliance with the applicable requirements of ERISA, or would result
or have resulted in liability under Title IV of ERISA or (ii) any
"reportable event" (as such term is defined in Section 4043(b) of
ERISA) or any "prohibited transaction" (as such term is defined in
Section 406 of ERISA and Section 4975(c) of the Code) which has
occurred since the date on which said sections became applicable to the
Plans and which could reasonably be expected to result in any material
liability of BANC ONE or any subsidiary to the Pension Benefit Guaranty
Corporation (the "PBGC"), the Department of Treasury, the Department of
Labor or any multiemployer plan. Those Plans which are defined benefit
plans within the meaning of ERISA meet the minimum funding standards
set forth in the Code and ERISA and the assets of such Plans equal or
exceed the current value of accrued benefits under such Plans on a
termination basis using PBGC interest rates as of the most recent plan
valuation dates. There are no pending or threatened claims (other than
claims for benefits in the ordinary course), lawsuits or arbitrations
which have been asserted or instituted against the Plans, any
fiduciaries thereof with respect to their duties to the Plans or the
assets of any of the trusts under any of the Plans which could
reasonably be expected to result in any material liability of BANC ONE
or any subsidiary to the PBGC, Department of Treasury, Department of
Labor or any multiemployer plan.
(l) Except where the failure to file would not have a BANC ONE Material
Adverse Effect, BANC ONE and/or its subsidiaries have duly filed all
federal, state, county and local income, franchise, bank, excise, real
and personal property and other tax
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returns and reports (including, but not limited to, those relating to
social security, withholding, unemployment insurance, and occupation,
sales and use taxes and those filed on a consolidated, combined or
unitary basis) required to have been filed by BANC ONE or its
subsidiaries up to the date hereof. All of the foregoing returns are
true and correct in all material respects, and BANC ONE and its
subsidiaries have paid or, prior to the Effective Time, will pay all
taxes, interest, additions to tax, and penalties shown on such returns
or reports as being due or (except to the extent the same are contested
in good faith and, if material, summarized in the BANC ONE Disclosure
Letter) claimed to be due to any federal, state, county, local or other
taxing authority, and there is, and at the Effective Time will be, no
basis for any additional claim or assessment which might have a BANC
ONE Material Adverse Effect, except for those being contested in good
faith and summarized in the BANC ONE Disclosure Letter. BANC ONE and
its subsidiaries have paid or made adequate provision in their
financial statements or on their books and records for all taxes
payable in respect of all periods ending on or before the date hereof.
BANC ONE and its subsidiaries have, and at the Effective Time will
have, no liability for any taxes, interest, additions to tax, or
penalties of any nature whatsoever, except for those taxes which may
have arisen up to the Effective Time in the ordinary course of business
and are properly accrued on the books of BANC ONE and its subsidiaries
as of the Effective Time or are being contested in good faith and have,
if material, been summarized in the BANC ONE Disclosure Letter.
(m) BANC ONE and its subsidiaries have in effect insurance coverage with
reputable insurers, which in respect of amounts, premiums, types and
risks insured, constitutes reasonably adequate coverage against all
risks customarily insured against by bank holding companies and their
subsidiaries comparable in size and operations to BANC ONE and its
subsidiaries.
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<PAGE>
(n) Neither the Proxy Statement/Prospectus nor the related registration
statement nor any amendment or supplement thereto that is filed with
the SEC in connection with the transactions contemplated hereby (except
for any information which has been or shall be supplied in writing by
PREMIER specifically for inclusion in the Proxy Statement/Prospectus
and registration statement and is so included as so supplied) shall
contain (in the case of information relating to the Proxy
Statement/Prospectus, at the time it is mailed and in the case of
information relating to the registration statement at the time it
becomes effective and in both cases at the time of the meeting of
PREMIER's shareholders held to consider the proposed Merger) any untrue
statement of a material fact or shall omit to state any material fact
necessary to make the statements contained therein, in light of the
circumstances in which they are made, not misleading. The registration
statement and any amendments or supplements thereto that are filed with
the SEC in connection with the transactions contemplated hereby will
comply as to form in all material respects with the provisions of the
1933 Act and the rules and regulations promulgated thereunder.
(o) No employee of BANC ONE or any of its subsidiaries is represented, for
purposes of collective bargaining, by a labor organization of any type.
BANC ONE is unaware of any efforts during the past five years to
unionize or organize any employees of BANC ONE or any of its
subsidiaries, and no claim related to such employees under the Fair
Labor Standards Act, National Labor Relations Act, Civil Rights Act of
1964, Walsh-Healy Act, Davis Bacon Act, Civil Rights Act of 1866, Age
Discrimination in Employment Act, Equal Pay Act of 1963, Executive
Order No. 11246, Federal Unemployment Tax Act, Vietnam Era Veterans
Readjustment Act, Occupational Safety and Health Act, or any state or
local employment related law, order, ordinance or regulation, and no
unfair labor practice, discrimination or wage-and-hour claim is pending
or, to the best of the knowledge of BANC ONE and its executive officers
after due inquiry, threatened
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<PAGE>
against BANC ONE or any of its subsidiaries which claim has had or is
reasonably likely to have a BANC ONE Material Adverse Effect.
(p) To the best of knowledge of BANC ONE and its executive officers after
due inquiry: (i) with respect to any contaminant, pollutant, hazardous
substance, hazardous waste, hazardous pollutant, toxic pollutant, toxic
waste or toxic substance ("Contaminant"), there are no material
actions, proceedings or investigations pending or threatened before any
federal or state environmental regulatory body, or before any federal
or state court, alleging non-compliance with or liability in connection
with, by BANC ONE or any of its subsidiaries, the Comprehensive
Environmental Response, Compensation and Liability Act, 42 U.S.C.
(S)(S) 9601 et seq. ("CERCLA"), the Resource Conservation and Recovery
Act, 42 U.S.C. (S)(S) 6901 et seq. ("RCRA"), the Clean Water Act, 33
U.S.C. (S)(S) 1251 et seq. ("CWA"), or the Clean Air Act, 42 U.S.C.
(S)(S) 7401 et seq. ("CAA"), as each is amended from time to time, or
any other federal, state, local or municipal statute, ordinance or
regulation, or order, ruling or other decision of any court,
administrative agency or other governmental authority relating to
health or safety or environmental protection (such statutes,
ordinances, regulations, orders, rulings and decisions, together,
"Environmental Laws"); (ii) there is no reasonable basis for the
institution of any material action, proceeding or investigation against
BANC ONE or any of its subsidiaries under any Environmental Law; (iii)
neither BANC ONE nor any of its subsidiaries is responsible in any
material respect under any Environmental Law for any release by any
person at or in the vicinity of real property of any Contaminant,
caused by the spilling, leaking, pumping, pouring, emitting, emptying,
discharging, injecting, escaping, leaching, dumping or disposing of any
such hazardous substance into the environment (collectively "Release");
(iv) neither BANC ONE nor any of its subsidiaries is responsible for
any material costs of any response action required by virtue of any
Release of any Contaminant into the environment including, without
limitation, costs arising from
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<PAGE>
investigation, removal or remediation of Contaminants, security
fencing, alternative water supplies, temporary evacuation and housing
and other emergency assistance undertaken by any environmental
regulatory body or any other person; (v) BANC ONE and each of its
subsidiaries are, in all material respects, in compliance with all
applicable Environmental Laws; and (vi) no real property owned or used
by BANC ONE or any of its subsidiaries contains any Contaminant
including, without limitation, any asbestos, PCBs or petroleum products
or byproducts in any form, the presence, location or condition of which
(a) could require remediation or other corrective action pursuant to
any Environmental Law in any material respect, or (b) otherwise would
pose any significant health or safety risk unless remedial measures
were taken.
(q) BANC ONE and/or its subsidiaries (i) have surveyed the facilities where
BANC ONE and its subsidiaries conduct their businesses including,
without limitation, automatic teller machines (collectively, the "BANC
ONE Facilities") for compliance with the Americans with Disabilities
Act and the regulations issued thereunder (collectively, "ADA"); (ii)
have developed action plans to remove architectural barriers including
communication barriers that are structural in nature from existing BANC
ONE Facilities (collectively, the "BANC ONE Barriers") when such
removal is "readily achievable," as that term is defined in ADA; (iii)
have finalized action plans for automatic teller machines ("ATMs") in
conformance with the Joint Final Rule of the Architectural and
Transportation Barriers Compliance Board ("ATBCB") and the Department
of Transportation, effective August 16, 1993; (iv) have developed or
will develop schedules for BANC ONE Barrier removal from BANC ONE
Facilities in such action plans so that BANC ONE Barrier removal was
complete on January 26, 1992 or will be completed as soon as
practicable thereafter; and (v) have removed all BANC ONE Barriers in
BANC ONE Facilities or will cause all BANC ONE Barriers to be removed
in accordance with such action plans. All "alterations" (as such term
is
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<PAGE>
defined in ADA) to BANC ONE Facilities undertaken after January 26,
1992 comply with ADA and the ATBCB Accessibility Guidelines for
Buildings and Facilities ("ADAAG"). Effective January 26, 1992, all
plans and designs for new construction to be utilized by BANC ONE and
its subsidiaries comply with ADA and ADAAG. To the best of the
knowledge of BANC ONE and its executive officers, after due inquiry, no
material investigations, proceedings, or complaints, formal or
informal, are pending or threatened against BANC ONE and/or its
subsidiaries in connection with BANC ONE Facilities under ADA, ADAAG,
or any other state or federal law concerning accessibility for
individuals with disabilities.
(r) The statements made and the information included in the BANC ONE
Disclosure Letter and any attachments thereto shall be deemed to
constitute representations and warranties of BANC ONE under this Merger
Agreement to the same extent as if herein set forth in full. Anything
disclosed in the BANC ONE Disclosure Letter or the attachments thereto
shall be considered to have been disclosed for purposes of all
representations, warranties and covenants under this Merger Agreement.
13. Representations and Warranties of PAC and of BANC ONE with respect to PAC.
-------------------------------------------------------------------------
BANC ONE and PAC represent and warrant to PREMIER that, except as set forth
in the BANC ONE Disclosure Letter:
(a) PAC is a corporation duly organized and validly existing under the laws
of the State of Ohio and is qualified to do business and is in good
standing in the State of Ohio together with all other jurisdictions
where it is both required to so qualify and the failure to so qualify
would have a material adverse effect on the business, operations,
financial condition or result of operations of PAC or on the ability of
PAC to consummate the transactions contemplated hereby, and PAC has
full
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<PAGE>
power and authority (including all licenses, franchises, permits and
other governmental authorizations which are legally required) to engage
in the business and activities now conducted by it. The authorized
capital stock of PAC is, and at the Effective Time will be, 500 shares
of common stock, without par value, of which 500 shares are issued and
outstanding, all of which are, and at the Effective Time will be, owned
of record and beneficially by BANC ONE free and clear of all liens,
security interests or other encumbrances. PAC has no subsidiaries.
(b) The Board of Directors of PAC has authorized execution of this Merger
Agreement and approved the acquisition of PREMIER as contemplated by
this Merger Agreement. PAC has all requisite power and corporate
authority to enter into this Merger Agreement and, after the approval
of the Merger by BANC ONE, PAC will have the authority to consummate
the transactions contemplated hereby. Subject to shareholder approval,
this Merger Agreement will constitute the valid and legally binding
obligation of PAC and this Merger Agreement and the consummation hereof
have been duly authorized and approved on behalf of PAC by all
requisite corporate action. Neither the execution and delivery of this
Merger Agreement nor, subject to PAC shareholder approval and provided
the required approvals are obtained from the Board and the
Commissioner, the consummation of the Merger will conflict with, result
in the breach of, constitute a default under or accelerate the
performance provided by the terms of any law, or any rule or regulation
of any governmental agency or authority or any judgment, order or
decree of any court, bank regulatory agency or other governmental
agency to which PAC may be subject, any contract, agreement or
instrument to which PAC is a party or by which PAC is bound or
committed, or the Articles of Incorporation or Code of Regulations of
PAC, or constitute an event which with the lapse of time or action by a
third party, could result in a default under any of the foregoing or
result in the creation of any lien, charge or
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<PAGE>
encumbrance upon any of the assets or properties of PAC or adversely
affect the ability of PAC to consummate the transactions contemplated
hereby.
(c) PAC was incorporated on January 2, 1991 for the sole purpose of
effecting the acquisition of PREMIER, and has not conducted any
business other than in connection with the 1992 Agreement or this
Merger Agreement. Except as may be directly related to the 1992
Agreement or this Merger Agreement, PAC has no assets other than $500
in cash and no liabilities of any nature whatsoever.
14. Representations and Warranties of PREMIER. PREMIER represents and warrants
-----------------------------------------
to BANC ONE that, except as shall be set forth in PREMIER's disclosure
letter (and any attachments or schedules annexed thereto) to BANC ONE, to be
provided to BANC ONE by PREMIER pursuant to the provisions of Section 15(i)
of this Merger Agreement (the "PREMIER Disclosure Letter"):
(a) PREMIER is a corporation duly organized and validly existing in good
standing under the laws of the State of Louisiana, is a registered bank
holding company under the Bank Holding Company Act of 1956, as amended,
and is qualified to do business and is in good standing in all
jurisdictions where it is both required to so qualify and where the
failure to so qualify would have a material adverse effect on the
business, operations, financial condition or results of operations of
PREMIER and the Subsidiaries taken as a whole, or on the ability of
PREMIER to consummate the transactions contemplated hereby (a "PREMIER
Material Adverse Effect") and PREMIER has full corporate power and
authority (including all licenses, franchises, permits and other
governmental authorizations which are legally required) to engage in
the businesses and activities now conducted by it and the Subsidiaries.
PREMIER is not subject to any formal or informal agreement or
understanding with, nor is it subject to any order of, any bank
regulatory authority restricting or prohibiting or attempting to
restrict or prohibit
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any activities or conduct of PREMIER. As of July 19, 1995, PREMIER had
authorized capital stock consisting of 100,000,000 shares of PREMIER
Common, of which a total of 33,828,969 shares were issued and
outstanding, not including 46,000 shares of treasury stock owned by
PREMIER, and 10,000,000 shares of PREMIER Preferred, none of which were
issued and outstanding. All of the issued and outstanding shares of
PREMIER Common are duly authorized, validly issued, fully paid and
nonassessable and none are issued in violation of the pre-emptive
rights of any shareholder. There are no outstanding options, warrants
or commitments of any kind related to PREMIER's capital stock and no
rights plan or other similar plan is related to PREMIER's capital stock
except for (i) options for not more than 1,132,090 shares of PREMIER
Common issued to officers and employees of PREMIER and its Subsidiaries
related to The Premier Stock Option Plan; (ii) certain rights and
interests granted to BANC ONE by PREMIER pursuant to the Amended and
Restated Agreement and Plan of Acquisition dated as of March 26, 1992
between BANC ONE and PREMIER, as amended by the First Amendment to
Amended and Restated Agreement and Plan of Acquisition dated as of
April 25, 1995 (together, the "1992 Agreement"); (iii) a commitment to
issue not more than 427,773 shares of PREMIER Common in exchange for
all the capital stock of HNB Corporation; (iv) shares issuable pursuant
to the Warrant Agreement dated as of March 26, 1992 between BANC ONE
and PREMIER (the "Warrant Agreement"); and (v) Rights issued or
issuable pursuant to the PREMIER Rights Plan.
(b) PREMIER has furnished to BANC ONE copies of the following financial
statements relating to PREMIER and the Subsidiaries on a consolidated
basis: (i) the audited Consolidated Balance Sheet of PREMIER as of
December 31, 1994 and 1993, and the Consolidated Statements of Income,
Stockholders' Equity and Cash Flows for each of the years in the three-
year period ended December 31, 1994, together with the notes thereto,
as audited by KPMG Peat Marwick,
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Certified Public Accountants; and (ii) the unaudited Consolidated
Balance Sheet of PREMIER as at March 31, 1995 and the related unaudited
Consolidated Statement of Income and Cash Flows for the quarter then
ended, together with the notes thereto as included in PREMIER's
Quarterly Report on Form 10-Q for the quarter ended March 31, 1995 as
filed with the SEC. Each of the aforementioned financial statements,
and all financial statements included in Forms 10-K or Forms 10-Q filed
with the SEC subsequent to the date of this Merger Agreement and prior
to the Effective Time will, present fairly, in accordance with
generally accepted accounting principles (applied on a consistent basis
except as disclosed in the footnotes thereto), the consolidated
financial position and results of operations of PREMIER as of the dates
and for the periods therein set forth. Such financial statements do not
or will not, as of the dates thereof, include any material asset or
omit any material liability, absolute or contingent, or other fact, the
inclusion or omission of which renders or would render such financial
statements, in light of the circumstances under which they were made,
misleading in any material respect. Since March 31, 1995, there has not
been any change in the financial condition, results of operations or
business of PREMIER and the Subsidiaries that has had a PREMIER
Material Adverse Effect.
(c) Since December 31, 1991, PREMIER and each of its Subsidiaries has filed
all reports, registrations and statements, together with any required
amendments thereto, that any of them was required to file with (i) the
SEC, including, but not limited to, all Forms 10-K, Forms 10-Q, Forms
8-K, annual reports and proxy statements, (ii) the Board, (iii) the
FDIC, (iv) the OCC and (v) any applicable state securities or banking
authorities. All such reports and statements filed (and to be filed in
the future) with any such regulatory body or authority are collectively
referred to in this Merger Agreement as the "Reports." As of their
respective dates, the Reports complied or, if filed in the future, will
comply, with the respective rules and regulations promulgated by the
SEC, the Board, the FDIC,
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<PAGE>
the OCC and state securities or banking authorities, and did not
contain at the time filed, and all Reports to be filed after the date
hereof and prior to the Effective Time will not contain at the time
filed, 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 under which
they were made, not misleading.
(d) The Board of Directors of PREMIER has duly authorized the execution and
delivery of this Merger Agreement and approved the Merger as
contemplated by the Merger Agreement and will recommend it to the
PREMIER shareholders for adoption unless, in the good faith judgment of
the Board of Directors such recommendation would be inconsistent with
its fiduciary duties. Subject to approval by the shareholders of
PREMIER and the contemplated regulatory approvals, this Merger
Agreement constitutes the valid, legally binding and enforceable
obligation of PREMIER and PREMIER has all requisite power and authority
to enter into this Merger Agreement and PREMIER has the authority to
consummate the transactions contemplated hereby so that, provided all
required corporate and regulatory approvals are obtained, neither the
execution and delivery of this Merger Agreement nor the consummation of
the Merger will conflict with, result in the breach of, constitute a
default under or accelerate the performance provided by the terms of
any law, or any rule or regulation of any governmental agency or
authority or any judgment, order or decree of any court, bank
regulatory agency or other governmental agency to which PREMIER is
subject, any contract, agreement or instrument to which PREMIER is a
party or by which PREMIER is bound or committed, or the Articles of
Incorporation or By-laws of PREMIER, or constitute an event which with
the lapse of time or action by a third party, could result in the
default under any of the foregoing or result in the creation of any
lien, charge or encumbrance upon any of the assets or properties of
PREMIER or upon any of PREMIER's capital stock, except, in the case of
contracts,
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<PAGE>
agreements or instruments, such defaults, conflicts or breaches which
either (i) will be cured or waived prior to the Effective Time or (ii)
if not so cured or waived would not, in the aggregate, have a PREMIER
Material Adverse Effect.
(e) The reserve for possible loan and lease losses shown on the March 31,
1995 Consolidated Balance Sheet of PREMIER is adequate in all material
respects under the requirements of generally accepted accounting
principles to provide for possible losses, net of recoveries relating
to loans previously charged off, on loans outstanding (including,
without limitation, accrued interest receivable) as of March 31, 1995.
(f) Except as disclosed in the financial statements referred to in Section
14(b), there is no litigation, action, suit, investigation or
proceeding pending or, to the best of the knowledge of PREMIER and its
executive officers after due inquiry, threatened against or affecting
PREMIER or any of its Subsidiaries or involving any of their respective
properties or assets, at law or in equity, before any federal, state,
municipal, local or other governmental authority which is reasonably
likely to be resolved adversely to the interest of PREMIER or its
Subsidiaries and, if so resolved, would have a PREMIER Material Adverse
Effect, and to the best of the knowledge of PREMIER and its executive
officers after due inquiry, no one has reasonable or valid grounds on
which it reasonably can be expected that anyone will assert or initiate
any such litigation, action, suit, investigation or proceeding against
PREMIER or any of the Subsidiaries.
(g) PREMIER and its Subsidiaries have good and marketable title to all
their respective assets and properties, whether real or personal,
tangible or intangible, including without limitation the capital stock
of its Subsidiaries and all other assets and properties reflected in
PREMIER's Consolidated Balance Sheet as of March 31, 1995 or which
would be reflected thereon if not fully amortized or
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<PAGE>
depreciated or acquired subsequent thereto (except to the extent that
such assets and properties have been disposed of for fair value in the
ordinary course of business since March 31, 1995). Such assets and
properties are subject to no liens, mortgages, security interests,
encumbrances, pledges or charges of any kind, except (i) as reflected
in said Consolidated Balance Sheet or the notes thereto or, with
respect to assets and properties acquired after March 31, 1995, as
noted in PREMIER's Consolidated Balance Sheet or the notes thereto
included in a periodic report filed with the SEC; (ii) statutory liens
for taxes not yet delinquent; (iii) landlord's liens; and (iv) minor
defects and irregularities in title and encumbrances which do not
materially impair the use thereof for the purposes for which they are
held; and such liens, mortgages, security interests, encumbrances and
charges do not, in the aggregate, have a PREMIER Material Adverse
Effect. PREMIER and its Subsidiaries as lessee have the right under
valid and subsisting leases to occupy, use, possess and control all
property leased by PREMIER and its Subsidiaries. At the Effective Time
all limitations affecting such properties will not, in the aggregate,
have a PREMIER Material Adverse Effect.
(h) To the best of the knowledge of PREMIER and its executive officers
after due inquiry, PREMIER and its Subsidiaries have complied with all
laws, regulations and orders applicable to them and to the conduct of
their businesses, including without limitation all statutes, rules and
regulations pertaining to the conduct of banking activities, except for
violations which, together with any penalty which results therefrom,
have not had and will not have a PREMIER Material Adverse Effect.
Neither PREMIER nor any of its Subsidiaries is in default under, and no
event has occurred which, to the best of the knowledge of PREMIER and
its executive officers, after due inquiry, is likely to result in a
default under the terms of any judgment, decree, order, writ, rule or
regulation of any governmental authority or court, whether federal,
state or local and whether at law or in equity,
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in each case where the default has had or is likely to have a PREMIER
Material Adverse Effect.
(i) PREMIER has not, since March 31, 1995 to the date hereof, (i) sold or
issued any corporate debt securities, granted any option for the
purchase of capital stock or sold, issued, reissued or increased its
shares of its capital stock, except as may be permitted pursuant to
Section 15(b) hereof or as incurred in carrying out the transaction
contemplated by this Merger Agreement; (ii) declared or set aside or
paid any dividend or other distribution in respect of its capital
stock, except as may be permitted pursuant to Section 15(a) hereof;
(iii) directly or indirectly, purchased, redeemed or otherwise acquired
any shares of such stock; (iv) incurred any obligation or liability
(absolute or contingent) except obligations or liabilities incurred in
the ordinary course of business, or mortgaged, pledged or subjected to
lien or encumbrance on any of its material assets or properties except
in the ordinary cause of business; (v) discharged or satisfied any
material lien or encumbrance or paid any material obligation or
liability (absolute or contingent), except in the ordinary course of
business; (vi) sold, exchanged or otherwise disposed of any material
capital assets; (vii) made any extraordinary officers' salary increase
or wage increase, entered into any employment contract with any officer
or salaried employee or instituted any employee welfare, bonus, stock
option, profit-sharing, retirement or similar plan or arrangement;
(viii) suffered any damage, destruction or loss, whether or not covered
by insurance, that has had a PREMIER Material Adverse Effect or waived
any rights of value which, in the aggregate, have had a PREMIER
Material Adverse Effect; (ix) entered or agreed to enter into any
agreement or arrangement granting any preferential right to purchase
any of its material assets, properties or rights or requiring the
consent of any party to the transfer and assignment of any such
material assets, properties or rights; or (x) entered into any other
material transaction (other than in the ordinary course of business)
except as expressly contemplated by this Merger Agreement.
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(j) Except as set forth in the PREMIER Document List (the "PREMIER Document
List") attached to the PREMIER Disclosure Letter, neither PREMIER nor
any of its Subsidiaries is a party to or bound by any written or oral
(i) employment or consulting contract which is not terminable by
PREMIER or its Subsidiaries on 60 days or less notice, (ii) employee
bonus, deferred compensation, pension, stock bonus or purchase, profit-
sharing, retirement or stock option plan, (iii) other employee benefit
or welfare plan, or (iv) other executory material agreements as defined
by the instructions to Exhibit 10 under Item 601 of SEC Regulation S-K.
All such pension, stock bonus or purchase, profit-sharing, retirement,
health and welfare plans (other than any multiemployer plans) set forth
in the PREMIER Document List are in this section hereinafter referred
to collectively as the "Plans." Those Plans intended to be qualified
plans under Section 401(a) of the Code meet any applicable requirements
for favorable tax treatment under the Code. All of the Plans which
constitute employee pension benefit plans or employee welfare plans
subject to ERISA have been maintained in compliance in all material
respects with the applicable requirements of ERISA. All material
notices, reports and other filings required under applicable law to be
given or made to or with any governmental agency with respect to the
Plans have been timely filed or delivered. PREMIER and its executive
officers after due inquiry have no knowledge of (i) any circumstances
which would adversely affect the qualification of the Plans or their
compliance with the applicable requirements of ERISA or would result or
have resulted in liability under Title IV of ERISA or (ii) any
unreported "reportable event" (as such term is defined in Section
4043(b) of ERISA) or any "prohibited transaction" (as such term is
defined in Section 406 of ERISA and Section 4975(c) of the Code) which
has occurred since the date on which said sections became applicable to
the Plans and which could reasonably be expected to result in any
material liability of PREMIER or any Subsidiary to the PBGC, the
Department of Treasury, the Department of Labor or any multiemployer
plan. Those Plans which are defined benefit plans within the meaning of
ERISA meet
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<PAGE>
the minimum funding standards set forth in the Internal Revenue Code
and ERISA and the assets of such Plans equal or exceed the current
value of accrued benefits on a termination basis under such Plans on a
termination basis using PBGC interest rates as of the most recent plan
valuation date. There are no pending or threatened claims (other than
claims for benefits in the ordinary course and pursuant to domestic
relations orders), lawsuits or arbitrations which have been asserted or
instituted against the Plans, any fiduciaries thereof with respect to
their duties to the Plans or the assets of any of the trusts under any
of the Plans which could reasonably be expected to result in any
material liability of PREMIER or any of its Subsidiaries to the PBGC,
the Department of Treasury, the Department of Labor or any
multiemployer plan.
(k) Except where the failure to file would not have a PREMIER Material
Adverse Effect, PREMIER and/or its Subsidiaries have duly filed all
federal, state, county and local income, franchise, bank, excise, real
and personal property and other tax returns and reports (including, but
not limited to, those relating to social security, withholding,
unemployment insurance, and occupation, sales, and use taxes and those
filed on a consolidated, combined or unitary basis) required to have
been filed by PREMIER or its Subsidiaries up to the date hereof.
PREMIER has made available to BANC ONE a copy of its Federal income tax
return for the years 1994 and 1993 and, if applicable, undertakes to
provide BANC ONE with a copy of its Federal income tax return for the
year 1995 when the same becomes available. All of the foregoing returns
are true and correct in all material respects, and PREMIER and its
Subsidiaries have paid or, prior to the Effective Time, will pay all
taxes, interest, additions to tax, and penalties shown on such returns
or reports as being due or (except to the extent the same are contested
in good faith and, if material, summarized in the PREMIER Disclosure
Letter) claimed to be due to any federal, state, county, local or other
taxing authority, and there is, and at the Effective Time will be, no
basis for any additional claim or assessment
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<PAGE>
which might have a PREMIER Material Adverse Effect, except for those
being contested in good faith and summarized in the PREMIER Disclosure
Letter. PREMIER and its Subsidiaries have paid or made adequate
provision in their financial statements or on their books and records
for all taxes payable in respect of all periods ending on or before the
date hereof. PREMIER and its Subsidiaries have, and at the Effective
Time will have, no liability for any taxes, interest, additions to tax,
or penalties of any nature whatsoever, except for those taxes which may
have arisen up to the Effective Time in the ordinary course of business
and are properly accrued on the books of PREMIER and the Subsidiaries
as of the Effective Time or are being contested in good faith and have,
if material, been summarized in the PREMIER Disclosure Letter.
(l) PREMIER and the Subsidiaries have in effect insurance coverage with
reputable insurers which in respect of amounts, premiums, types and
risks insured, constitutes reasonably adequate coverage against all
risks customarily insured against by bank holding companies and their
subsidiaries comparable in size and operations to PREMIER and the
Subsidiaries.
(m) PREMIER has not incurred and will not incur any liability for
brokerage, finders' or investment bankers' fees or commissions in
connection with this Merger Agreement or the transactions contemplated
hereby except for fees to Merrill Lynch, Pierce, Fenner & Smith,
Incorporated as set forth in that certain letter dated March 18, 1994
between PREMIER and Merrill, Lynch, Pierce, Fenner & Smith,
Incorporated which letter shall be included as an exhibit to the
PREMIER Disclosure Letter.
(n) PREMIER has annexed to the PREMIER Disclosure Letter a loan schedule
identifying certain loan agreements, notes and borrowing arrangements
(the "PREMIER Loan Schedule") between its Subsidiaries and borrowers
from its
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<PAGE>
Subsidiaries. Except as specifically noted on the PREMIER Loan
Schedule, as of June 30, 1995 no Subsidiary was a party to any (i)
written or oral loan agreement, note or borrowing arrangement under the
terms of which the obligor is delinquent more than 30 days, but less
than 90 days, in payment of principal or interest or, to the best of
PREMIER's knowledge, in default of any other provision as of the dates
shown thereon, other than (A) commercial loans the unpaid balance of
which does not exceed $100,000 per loan and (B) consumer, credit card
or other loans the unpaid balance of which does not exceed $50,000 per
loan; (ii) written or oral loan agreement, note or borrowing
arrangement which has been classified as "substandard," "doubtful,"
"loss," "other loans especially mentioned" or any comparable
classifications by PREMIER, such Subsidiary or any banking regulator;
(iii) written or oral loan agreement, note or borrowing arrangement,
including any loan guaranty, with any director, executive officer or
ten percent shareholder of PREMIER, or to the actual knowledge of
PREMIER and its executive officers, after due inquiry, any person,
corporation or enterprise controlling, controlled by or under common
control with any of the foregoing; or, (iv) to the best of PREMIER's
knowledge, any written or oral loan agreement, note or borrowing
arrangement in violation of any law, regulation or rule of any
governmental authority and which violation could, to the best of
PREMIER's knowledge after due inquiry, have a PREMIER Material Adverse
Effect.
(o) None of the information provided by PREMIER to BANC ONE for inclusion
in the Proxy Statement/Prospectus or related registration statement or
any amendment or supplement thereto (to the extent so included as so
provided) shall contain (in the case of information relating to the
Proxy Statement/Prospectus, at the time it is mailed and in the case of
information relating to the registration statement, at the time it
becomes effective and in both cases at the time of the meeting of
PREMIER's shareholders held to consider the proposed Merger) any untrue
statement of a material fact or shall omit to state any material fact
necessary to
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<PAGE>
make the statements contained therein, in light of the circumstances in
which they are made, not misleading. The Proxy Statement/Prospectus
that is filed with the SEC in connection with the meeting of the
shareholders of PREMIER will comply as to form in all material respects
with the provisions of the 1934 Act and the rules and regulations
promulgated thereunder.
(p) Except as specifically disclosed on the PREMIER Contracts Schedule
annexed to the PREMIER Disclosure Letter, neither PREMIER nor any
Subsidiary is, as of the date hereof, a party to any material contract
and/or any material credit agreement as obligor, maker, issuer or
guarantor and which contract or agreement contains covenants which make
the acquisition of PREMIER or any Subsidiary by or merger with another
entity a condition of default or acceleration.
(q) Attached hereto as Exhibit A is PREMIER's Subsidiaries List which sets
---------
forth the complete legal name of each Subsidiary and of any other
entity in which PREMIER and/or any Subsidiary owns or controls 5% or
more of its capital or voting stock, a designation of the laws under
which each is incorporated or organized, the percentage interest owned
by PREMIER or a Subsidiary in each such entity, the activities
conducted by each entity. Except as set forth in Exhibit A, PREMIER has
---------
no Subsidiaries or interests of 5% or more of the capital or voting
stock of any entity, except any entity in which such interest is owned
or controlled in a fiduciary capacity. Each of the Subsidiaries and
other entities set forth on Exhibit A is a corporation, limited
---------
liability company or similar entity duly organized and validly existing
in good standing under the laws of the United States or the state of
its incorporation and has full power and authority (including all
licenses, franchises, permits and other governmental authorizations
which are legally required) to engage in the businesses and activities
now conducted by it and is duly qualified to do business and is in good
standing in all jurisdictions where the failure to so qualify (together
with all such failures) would have a
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<PAGE>
PREMIER Material Adverse Effect. Except as may be set forth in
Exhibit A, PREMIER owns beneficially and of record all the outstanding
---------
shares of capital stock of each Subsidiary and entity listed on
Exhibit A, which stock is fully paid and non-assessable, except as
---------
provided by law. Neither PREMIER nor any Subsidiary listed on Exhibit A
---------
is a party to any partnership or joint venture except as may be set
forth and described in Exhibit A.
---------
(r) No employee of PREMIER or any of its Subsidiaries is represented, for
purposes of collective bargaining, by a labor organization of any type.
PREMIER is unaware of any efforts during the past five years to
unionize or organize any employees of PREMIER or any of its
Subsidiaries, and no claim related to such employees under the Fair
Labor Standards Act, National Labor Relations Act, Civil Rights Act of
1964, Walsh-Healy Act, Davis Bacon Act, Civil Rights Act of 1866, Age
Discrimination in Employment Act, Equal Pay Act of 1963, Executive
Order No. 11246, Federal Unemployment Tax Act, Vietnam Era Veterans
Readjustment Act, Occupational Safety and Health Act, or any state or
local employment related law, order, ordinance or regulation, and no
unfair labor practice, discrimination or wage-and-hour claim is pending
or, to the best of the knowledge of PREMIER and its executive officers
after due inquiry, threatened against PREMIER or its Subsidiaries,
which claim has had or is reasonably likely to have a PREMIER Material
Adverse Effect.
(s) To the best of the knowledge of PREMIER and its executive officers
after due inquiry: (i) with respect to any Contaminant, there are no
material actions, proceedings or investigations pending or threatened
before any federal or state environmental regulatory body, or before
any federal or state court, alleging non-compliance with or liability
in connection with, by PREMIER or any Subsidiary, CERCLA or any other
Environmental Laws; (ii) there is no reasonable basis for the
institution of any material action, proceeding or investigation against
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<PAGE>
PREMIER or any Subsidiary under any Environmental Law; (iii) neither
PREMIER nor any Subsidiary is responsible in any material respect under
any Environmental Law for any Release; (iv) neither PREMIER nor any
Subsidiary is responsible for any material costs of any response action
required by virtue of any Release of any Contaminant into the
environment including, without limitation, costs arising from
investigation, removal or remediation of Contaminants, security
fencing, alternative water supplies, temporary evacuation and housing
and other emergency assistance undertaken by any environmental
regulatory body or any other person; (v) PREMIER and each Subsidiary
is, in all material respects, in compliance with all applicable
Environmental Laws; and (vi) no real property owned or used by PREMIER
or any Subsidiary contains any Contaminant including, without
limitation, any asbestos, PCBs or petroleum products or byproducts in
any form, the presence, location or condition of which (a) could
require remediation or other corrective action pursuant to any
Environmental Law in any material respect, or (b) otherwise would pose
any significant health or safety risk unless remedial measures were
taken.
(t) PREMIER and/or the Subsidiaries (i) have surveyed the facilities where
PREMIER and its Subsidiaries conduct their businesses including,
without limitation, ATMs (collectively, the "PREMIER Facilities") for
compliance with ADA; (ii) have developed action plans to remove
architectural barriers including communication barriers that are
structural in nature from existing PREMIER Facilities (collectively,
the "PREMIER Barriers") when such removal is "readily achievable," as
that term is defined in ADA; (iii) have finalized action plans for ATMs
in conformance with the Joint Final Rule of the ATBCB and the
Department of Transportation, effective August 16, 1993; (iv) have
developed or will develop schedules for PREMIER Barrier removal from
PREMIER Facilities in such action plans so that PREMIER Barrier removal
was complete on January 26, 1992 or will be completed as soon as
practicable thereafter; and (v) have removed all
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<PAGE>
PREMIER Barriers in PREMIER Facilities or will cause all PREMIER
Barriers to be removed in accordance with such action plans. All
"alterations" (as such term is defined in ADA) to PREMIER Facilities
undertaken after January 26, 1992 comply with ADA and the ADAAG.
Effective January 26, 1992, all plans and designs for new construction
to be utilized by PREMIER and the Subsidiaries comply with ADA and
ADAAG. To the best of PREMIER's knowledge, after due inquiry, no
material investigations, proceedings, or complaints, formal or
informal, are pending or threatened against PREMIER and/or the
Subsidiaries in connection with PREMIER Facilities under ADA, ADAAG, or
any other state or federal law concerning accessibility for individuals
with disabilities.
(u) The statements made in the PREMIER Disclosure Letter and any
attachments thereto shall be deemed to constitute representations and
warranties of PREMIER under this Merger Agreement to the same extent as
if herein set forth in full. Anything disclosed in the PREMIER
Disclosure Letter or the attachments thereto shall be considered to
have been disclosed for purposes of all representations, warranties and
covenants under this Merger Agreement.
(v) PREMIER has taken or has the legal right to take all action with
respect to the PREMIER Rights Plan so that the execution of this Merger
Agreement and the consummation of the merger and other transactions, as
contemplated by the Merger Agreement, did not and will not result in
the grant, issuance or triggering of any right or entitlement or the
obligation to grant or issue any interest in PREMIER Common, BANC ONE
Common or the common stock of the Surviving Corporation to any person
under the PREMIER Rights Plan or enabling or allowing any Right
associated with the PREMIER Rights Plan to be exercised, distributed or
triggered at any time.
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<PAGE>
15. Action by PREMIER Pending Effective Time. PREMIER agrees that from the
----------------------------------------
date of this Merger Agreement until the earlier of the Effective Time or the
time that this Merger Agreement is terminated, except as stated in PREMIER's
Disclosure Letter and except with prior written permission of BANC ONE,
which, in any case covered by Section 15(d) hereof, shall not be
unreasonably withheld:
(a) Beginning with the third calendar quarter of 1995 and for each
succeeding calendar quarter thereafter prior to that calendar quarter
in which the Effective Time shall occur, PREMIER
(i) will not declare or pay any dividends or make any distributions
on shares of PREMIER Common, except cash dividends of $0.25 per
share per quarter;
(ii) except as hereinbelow provided, will not declare or pay any
dividends or make any distributions in any amount on its PREMIER
Common in the quarter in which the Effective Time shall occur
and for which quarter the shareholders of PREMIER Common are
entitled to receive regular quarterly dividends on the shares of
BANC ONE Common into which the shares of PREMIER Common have
been converted. It is the intent of this part (ii) to provide
that the holders of PREMIER Common will receive either the
payment of cash dividends on their shares of PREMIER Common or
the payment of cash dividends as the holders of shares of BANC
ONE Common received in exchange for the shares of PREMIER Common
for the calendar quarter during which the Effective Time shall
occur, but will not receive and will not become entitled to
receive for the same calendar quarter both the payment of a cash
dividend as shareholders of PREMIER and the payment of a cash
dividend as the holders of the shares of BANC ONE Common
received in exchange for the shares of
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<PAGE>
PREMIER Common. In the event that PREMIER does not declare and
pay cash dividends on its PREMIER Common in a particular
calendar quarter because of PREMIER's reasonable expectation
that the Effective Time would occur in said calendar quarter
wherein the holders of PREMIER Common would have become entitled
to receive cash dividends for such calendar quarter on the
shares of BANC ONE Common to have been exchanged for the shares
of PREMIER Common, and the Effective Time does not in fact occur
effective in said calendar quarter, then, as a result thereof,
PREMIER shall be entitled to declare and pay a cash dividend
(within the limitations of this Section 15) on said shares of
PREMIER Common for said calendar quarter as soon as reasonably
practicable.
For all cash dividends declared and/or paid by PREMIER pursuant to this
Section 15(a) prior to the Effective Time, PREMIER shall adopt a record
date for entitlement to receive any such quarterly dividend (the
"Record Date") which shall be the 15th day of the third month of any
such quarter; provided, however, that (i) the Record Date for a cash
dividend which may be declared and paid by PREMIER for and during the
third quarter of 1995 will not be so restricted with respect to the
Record Date and (ii) if BANC ONE and PREMIER agree that the Closing
will (a) not occur in a given calendar quarter or (b) will not occur
until after the 15th day of the third month of such given calendar
quarter, PREMIER will not be so restricted as to the selection of the
Record Date for such calendar quarter.
The declaration of any dividends within the limitations of this Section
15(a) shall remain within the discretion of the Board of Directors of
PREMIER.
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<PAGE>
(b) PREMIER will not (and will not contract or agree to) issue, sell, or
grant any warrant, option, phantom stock option, stock appreciation
right or commitment of any kind for or related to or acquire (or
contract or agree to acquire) for value any shares of its capital stock
or otherwise effect any change in connection with its equity
capitalization except as related to (i) the outstanding stock options
which have been granted to purchase not more than 1,132,090 shares of
PREMIER Common pursuant to the PREMIER Stock Option Plan and (ii) the
issuance of 427,773 shares of PREMIER Common in connection with
PREMIER's acquisition of HNB Corporation.
(c) Except as otherwise set forth in or contemplated by this Merger
Agreement, PREMIER will carry on its businesses in substantially the
same manner as heretofore, keep in full force and effect insurance
comparable in amount and scope of coverage to that now maintained by it
and use its best efforts to maintain and preserve its business
organization intact.
(d) Neither PREMIER nor any Subsidiary will (i) enter into any new line of
business or incur or agree to incur any obligation or liability except
liabilities and obligations (including corporate debt issuances)
incurred in the ordinary course of business, except as may be directed
by any regulatory agency; (ii) except as may be directed by any
regulatory agency or required by any law or regulation, change its or
the Subsidiaries' lending, investment, liability management and other
material banking policies in any material respect; (iii) except in the
ordinary course of business and consistent with prior practice, grant
any general or uniform increase in the rates of pay of employees; (iv)
establish any new employee benefit plan or amend any existing plan
(except as required by law) so as to increase by any significant amount
the benefits payable thereunder; (v) incur or commit to any capital
expenditures other than in the ordinary course of business (which will
in no event include the establishment of new branches or any other
facilities or any
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<PAGE>
capital expenditures in excess of $100,000 for any individual project
for any purpose); or (vi) merge into, consolidate with or, except for
the pending acquisition of HNB Corporation, permit any other
corporation to be merged or consolidated with it or any of its
Subsidiaries or acquire part of or all the assets or stock of any other
corporation or person or commit or agree to any such merger,
consolidation or acquisition.
(e) PREMIER will not change its or its Subsidiaries' methods of accounting
in effect at December 31, 1994, except as required by changes in
generally accepted accounting principles as concurred in by KPMG Peat
Marwick, or change any of its methods of reporting income and
deductions for Federal income tax purposes from those employed in the
preparation of PREMIER's federal income tax returns for the taxable
years ending December 31, 1994 and 1993, except as required by changes
in law.
(f) To the extent permitted by law, PREMIER will afford BANC ONE, its
officers and other authorized representatives, such access to all
books, records, bank examination reports, tax returns, leases,
contracts and documents of PREMIER and its Subsidiaries and will
furnish to BANC ONE such information with respect to the assets and
business of PREMIER and its Subsidiaries as BANC ONE may from time to
time reasonably request in connection with this Merger Agreement and
the transactions contemplated hereby.
(g) PREMIER will promptly provide BANC ONE with copies of all material
written resolutions of PREMIER's Board of Directors or shareholders,
furnish BANC ONE with copies of all monthly and other interim financial
statements of PREMIER as they become available, and keep BANC ONE fully
informed concerning all trends and developments which in the reasonable
opinion of PREMIER may have a PREMIER Material Adverse Effect.
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<PAGE>
(h) PREMIER, its Subsidiaries and their respective officers, directors and
employees will not contract for or acquire, at the expense of PREMIER
or any of its Subsidiaries, a policy or policies providing for
insurance coverage for directors, officers and/or employees of PREMIER
and/or its Subsidiaries for any period subsequent to the Effective Time
for events occurring before or after the Effective Time; provided,
however, that PREMIER may (i) renew, extend or replace existing
policies in the ordinary course consistent with past practices for
periods of not greater than one year and (ii) acquire a policy which
provides coverage through December 31, 1997 for those directors,
officers and/or employees of PREMIER and/or its Subsidiaries who are
presently provided coverage by policies obtained by PREMIER with
respect to (a) events related to this Merger Agreement and the events
contemplated by this Merger Agreement and (b) claims and/or causes of
action arising from or related to events which occurred prior to the
Closing Date.
(i) As soon as reasonably possible, but in any event within ten business
days from the date of this Merger Agreement, PREMIER will provide and
deliver to BANC ONE in final, executed form, the PREMIER Disclosure
Letter together with all schedules, lists, and other attachments
thereto as set forth and described in Section 14 of this Merger
Agreement.
16. Action by BANC ONE Pending Effective Time. BANC ONE agrees that from the
-----------------------------------------
date of this Agreement until the Effective Time, except as stated in BANC
ONE's Disclosure Letter and except with prior written permission of PREMIER:
(a) BANC ONE will not adopt or implement any amendment to its Articles of
Incorporation or any plan of reorganization which would affect in any
manner the terms and provisions of the shares of BANC ONE Common or the
rights of the holders of such shares or reclassify the BANC ONE Common.
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<PAGE>
(b) Except as otherwise set forth in or contemplated by this Merger
Agreement, BANC ONE will carry on its businesses in substantially the
same manner as heretofore, keep in full force and effect insurance
comparable in amount and scope of coverage to that now maintained by it
and use its best efforts to maintain and preserve its business
organization intact.
(c) BANC ONE will not change its methods of accounting in effect at
December 31, 1994, except as required by changes in generally accepted
accounting principles as concurred in with Coopers & Lybrand, its
independent auditors, or change any of its methods of reporting income
and deductions for federal income tax purposes from those employed in
the preparation of the federal income tax returns of BANC ONE for the
taxable years ending December 31, 1994 and 1993, except as required by
changes in law.
(d) To the extent permitted by law, BANC ONE will afford PREMIER, its
officers and other authorized representatives, such access to all
books, records, bank examination reports, tax returns, leases,
contracts and documents of BANC ONE and its subsidiaries and will
furnish to PREMIER such information with respect to the assets,
earnings and business of BANC ONE and its subsidiaries as PREMIER may
from time to time reasonably request in connection with this Merger
Agreement and the transactions contemplated hereby.
(e) BANC ONE agrees that while this Merger Agreement is in effect it will
not acquire, or enter into negotiations to acquire, directly or
indirectly, any bank located in Louisiana (other than Premier Bank)
with deposits in excess of $2 billion without the written consent of
PREMIER, which consent will not be unreasonably withheld.
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17. Conditions to Obligations of BANC ONE and PAC. The obligations of BANC ONE
---------------------------------------------
and PAC to effect the Merger are subject, unless waived by BANC ONE, to the
satisfaction on or prior to the Effective Time of the following conditions:
(a) There shall not have been any change in the consolidated financial
condition, aggregate net assets, shareholders' equity, business or
operating results of PREMIER and its Subsidiaries, taken as a whole,
from, March 31, 1995 to the Effective Time that has had a PREMIER
Material Adverse Effect.
(b) PREMIER shall not have paid cash dividends from March 31, 1995 to the
Effective Time except as permitted under this Merger Agreement.
(c) All representations by PREMIER contained in this Merger Agreement shall
be true at, or as of, the Effective Time as though such representations
were made at and as of said date, except for (i) changes contemplated
by the Merger Agreement, (ii) representations as of a specified time
other than the Effective Time, which shall be true at such specified
time (provided, however, that the representation of PREMIER contained
in Section 14(e) shall be true in all material respects as applied to
the Consolidated Balance Sheet of PREMIER included in the most recently
available quarterly or annual report to PREMIER shareholders and/or
PREMIER's report to the SEC on Form 10-Q or Form 10-K as of the close
of the most recent calendar quarter prior to the Effective Time and the
reserve for possible loan and lease losses included therein, as though
each reference to "March 31, 1995" in such section were a reference to
the last day of the most recent calendar quarter prior to the Effective
Time), and (iii) inaccuracies or breaches which do not, individually or
in the aggregate, have a PREMIER Material Adverse Effect.
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(d) BANC ONE shall have received the opinion of legal counsel for PREMIER,
dated as of the Closing Date, substantially to the effect set forth in
Exhibit C hereto, together with a copy of the Articles of
---------
Incorporation, as amended, of PREMIER certified by the Secretary of
State of the State of Louisiana and a copy of the charter documents, as
amended, of each Subsidiary and, for PREMIER and each Subsidiary,
Certificates of Good Standing dated as of a date not more than 20 days
prior to the Effective Time from the Louisiana Secretary of State, the
OCC, Commissioner or other appropriate government or regulatory
official.
(e) PREMIER shall have performed, in all material respects, all agreements
and conditions required by this Merger Agreement to be performed and
satisfied by it at or prior to the Effective Time.
(f) As of the close of the most recent calendar quarter (or if the
Effective Time shall occur within 20 days following the close of a
calendar quarter, then as of the next preceding calendar quarter)
cumulative per share earnings reported by PREMIER since March 31, 1995
shall be greater than or equal to the amount calculated by multiplying
(x) $0.50 by (y) the number of full calendar quarters which have passed
since March 31, 1995 and for which earnings have been reported by
PREMIER as of such date, times (z) 0.9. As used in this Section,
"reported" means reported on PREMIER's financial statements prepared in
accordance with generally accepted accounting principles applied on a
basis consistent with PREMIER's financial statements for the years
ended December 31, 1994 and 1993, as included in PREMIER's reports to
the SEC on Forms 10-K or PREMIER's annual reports to shareholders,
subject to any subsequent adjustments required to be reported whether
or not such adjustments have, as yet, been reported with the following
adjustments, if any, net of related income tax savings and costs, which
were reflected in net income for the relevant period(s) added back into
or deducted from net income for the applicable period: (i) investment
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banking expenses and outside legal and accounting fees and expenses
associated with or resulting from the Merger; (ii) gains or losses on
sales of assets outside of the ordinary course of business; and (iii)
any other expenses upon which BANC ONE and PREMIER shall mutually
agree.
(g) The total number of shares of PREMIER Common issued and outstanding
(not including treasury shares held by PREMIER), together with the
total number of shares of PREMIER Common related to outstanding options
with respect to The Premier Stock Option Plan shares, shall not be more
than 35,388,832 shares.
(h) The holders of all credit agreements on which PREMIER or any of the
Subsidiaries is the maker, issuer or guarantor and which contain
provisions which make the acquisition of PREMIER by or merger into
another entity a condition of default or acceleration, which default or
acceleration would have a PREMIER Material Adverse Effect, shall have
provided BANC ONE with a written waiver of all such provisions.
(i) PREMIER shall have furnished BANC ONE a certificate, signed on its
behalf by the Chairman or President and the Secretary or an Assistant
Secretary of PREMIER and dated as of the Closing Date, certifying as to
the form of and adoption of resolutions of the Board and shareholders
of PREMIER approving the Merger Agreement and the Merger, respectively,
and to the effect that the conditions described in Paragraphs (a), (b),
(c), (e), (f) and (g) of this Section 17 have been satisfied.
(j) BANC ONE shall have received the opinion of Jones, Walker, Waechter,
Poitevent, Carrere & Denegre, L.L.P., New Orleans, Louisiana, legal
counsel for PREMIER, dated as of the Effective Time, opining that in
the opinion of such counsel PREMIER has taken action with respect to
the PREMIER Rights Plan
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<PAGE>
appropriate to prevent the approval, execution or delivery of this
Merger Agreement or the acquisition of shares of PREMIER Common by BANC
ONE pursuant hereto, or consummation of the Merger or other transaction
contemplated by this Merger Agreement from resulting in the grant,
issuance or triggering of any right or entitlement or the obligation to
grant or issue any interest in PREMIER Common, BANC ONE Common or the
common stock of the Surviving Corporation to any person under the
PREMIER Rights Plan or enabling or allowing any right associated with
the PREMIER Rights Plan to be exercised, distributed or triggered.
(k) PREMIER shall have consummated its acquisition of HNB Corporation or
the agreement pursuant to which PREMIER had expected to acquire HNB
Corporation shall have terminated.
18. Conditions to Obligations of PREMIER. The obligations of PREMIER to effect
------------------------------------
the Merger are subject, unless waived by PREMIER, to the satisfaction on or
prior to the Effective Time of the following conditions:
(a) There shall not have been any change in the consolidated financial
condition, aggregate net assets, shareholders' equity, business, or
operating results of BANC ONE and its subsidiaries, taken as a whole,
from March 31, 1995 to the Effective Time that has had a BANC ONE
Material Adverse Effect.
(b) All representations by BANC ONE and PAC contained in this Merger
Agreement shall be true at, or as of, the Effective Time as though such
representations were made at and as of said date, except for changes
(i) contemplated by this Merger Agreement, (ii) representations as of a
specified time other than the Effective Time, which shall be true in
all material respects at such specified time (provided, however, that
the representation of BANC ONE contained in Section 12(e) shall
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<PAGE>
be true in all material respects as applied to the Consolidated Balance
Sheet of BANC ONE included in the most recently available quarterly or
annual report to BANC ONE's shareholders and/or BANC ONE's report to
the SEC on Form 10-Q or Form 10-K as of the close of the most recent
calendar quarter prior to the Effective Time and the reserve for
possible loan and lease losses included therein, as though each
reference to "March 31, 1995" in such section were a reference to the
last day of the most recent calendar quarter prior to the Effective
Time), and (iii) inaccuracies or breaches which do not, individually or
in the aggregate, have a BANC ONE Material Adverse Effect.
(c) PREMIER shall have received the opinion of counsel for BANC ONE and
PAC, (i) on and dated the date on which the registration statement
described in Section 10(d) of this Merger Agreement shall have become
effective as described in Section 19(c) of this Merger Agreement
substantially to the effect of paragraphs numbered 6, 7 and 8 of
Exhibit D hereto and (ii) on and dated as of the Closing Date
---------
substantially to the effect set forth in Exhibit D hereto, together
---------
with copies of the Articles of Incorporation of each of BANC ONE and
PAC certified by the Secretary of State of the State of Ohio and copies
of such other charter documents and Certificates of Good Standing of
BANC ONE and PAC dated as of a date not more than 20 days prior to the
day of the Effective Time from the Ohio Secretary of State as PREMIER
shall reasonably require.
(d) BANC ONE and PAC shall have performed, in all material respects, all
agreements and conditions required by this Merger Agreement to be
performed and satisfied by it at or prior to the Effective Time.
(e) As of the close of the most recent calendar quarter (or if the
Effective Time shall occur within 20 days following the close of a
calendar quarter, then as of the close of the next preceding calendar
quarter) cumulative per share earnings reported by
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BANC ONE since March 31, 1995 shall be greater than or equal to the
amount calculated by multiplying (x) $0.77 by (y) the number of full
calendar quarters which have passed since March 31, 1995 and for which
earnings have been reported by BANC ONE as of such date, times (z) 0.9.
As used in this Section, "reported" means reported on BANC ONE's
consolidated financial statements prepared in accordance with generally
accepted accounting principles applied on a basis consistent with BANC
ONE's consolidated financial statements for the years ended December
31, 1994 and 1993, as included in BANC ONE's reports to the SEC on
Forms 10-K or BANC ONE's annual reports to shareholders subject to any
subsequent adjustments required to be reported to the SEC whether or
not such adjustments have, as yet, been reported with the effect of any
changes in accounting principles required to be adopted by BANC ONE by
any regulatory authority or under generally accepted accounting
principles, if any, net of related income tax savings and costs, which
were reflected in net income for the relevant period(s) added back into
or deducted from net income for the relevant period(s).
(f) BANC ONE shall have furnished PREMIER a certificate, signed by the
Chairman or President or an Executive Vice President and by the
Secretary or Assistant Secretary of BANC ONE and dated as of the
Closing Date certifying as to the form of and adoption of the
resolutions of the Board of BANC ONE approving the Merger Agreement and
the Merger, and to the effect that the conditions described in
Paragraphs (a), (b), (d), (e), (g) and (h) of this Section 18 have been
satisfied as to it.
(g) This Merger Agreement and the Merger shall have been duly approved and
adopted by the requisite affirmative vote of BANC ONE as the sole
shareholder of PAC or by the unanimous written consent of BANC ONE as
the sole shareholder of PAC.
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<PAGE>
(h) The shares of BANC ONE Common to be issued to the holders of PREMIER
Common shall have been approved for listing on the NYSE.
(i) PREMIER shall have received the opinion of Merrill Lynch, Pierce,
Fenner & Smith, Incorporated, dated as of a date not more than five
days prior to the date of the Proxy Statement/Prospectus with respect
to the fairness of the transaction to PREMIER's shareholders from a
financial point of view satisfactory in form and substance to PREMIER
and its counsel, and such opinion shall not have been withdrawn prior
to the Effective Time.
19. Conditions to Obligations of All Parties. In addition to the provisions of
----------------------------------------
Sections 17 and 18 hereof, the obligations of BANC ONE and PREMIER to effect
the Merger shall be subject to the satisfaction of the following conditions
on or prior to the Effective Time:
(a) The parties hereto shall have received all necessary approvals of
governmental agencies and authorities of the transactions contemplated
by this Merger Agreement and each of such approvals shall remain in
full force and effect at the Effective Time. BANC ONE shall notify
PREMIER promptly upon receipt of all necessary governmental approvals.
(b) At the Effective Time, (i) no party hereto shall be subject to any
order, decree or injunction of a court or governmental agency of
competent jurisdiction which enjoins or prohibits the consummation of
the Merger; (ii) no statute, rule, regulation, order, injunction or
decree shall have been enacted, entered, promulgated or enforced by any
governmental authority which prohibits or makes illegal consummation of
the Merger; and (iii) there shall have been no stop order issued or
threatened by the SEC that suspends or would suspend the effectiveness
of the registration statement, and no proceeding by the SEC shall have
been commenced, pending or overtly threatened for such purpose.
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<PAGE>
(c) The registration statement required to be filed by BANC ONE pursuant to
Section 10(d) of this Merger Agreement shall have become effective by
an order of the SEC, and the shares of BANC ONE Common to be exchanged
in the Merger shall have been qualified or exempted under all
applicable state securities laws.
(d) This Merger Agreement and the Merger shall have been duly approved and
adopted by the requisite affirmative vote of the shareholders of
PREMIER.
(e) Coopers & Lybrand shall have issued its written opinion, dated as of
the Closing Date, satisfactory to PREMIER and BANC ONE, respectively,
substantially to the effect set forth in clauses (a) through (e) of
Section 11 of this Merger Agreement and there shall exist as of, at or
immediately prior to the Effective Time, no facts or circumstances
which would render such opinion inapplicable in any respect to the
transactions to be consummated hereunder.
20. Indemnification.
---------------
(a) In the event of any threatened or actual claim, action, suit,
proceeding or investigation, whether formal or informal and whether
civil, administrative or criminal, including, without limitation, any
such claim, action, suit, proceeding or investigation pursuant to which
any person who is now, or has been at any time prior to the date
hereof, or who becomes prior to the Effective Time, a director,
officer, employee, fiduciary or agent of PREMIER or any of its
Subsidiaries (the "Indemnified Parties") is, or is threatened to be,
made a party or a witness, based in whole or in part on, or arising in
whole or in part out of, or pertaining to, this Merger Agreement or any
of the transactions contemplated hereby (a "Merger Related Event"),
whether in any case asserted or arising before or after the Effective
Time, the parties hereto agree to cooperate and use their reasonable
best efforts to defend against and respond to such claim, action, suit,
proceedings or
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<PAGE>
investigation. With respect to any Merger Related Event, and
conditioned upon the Merger becoming effective, BANC ONE shall
indemnify, defend and hold harmless, as and to the fullest extent
permitted by applicable law, each Indemnified Party against any and all
losses, claims, damages, liabilities, costs, expenses (including
attorneys' fees and expenses), judgments and fines, and amounts paid in
settlement, in connection with any such threatened or actual claim,
action, suit, proceedings or investigation; provided, however, that
BANC ONE shall not be liable for any settlement effected without its
prior written consent (which consent shall not be unreasonably
withheld). In the event of any such threatened or actual claim, action,
suit, proceedings or investigation (whether asserted or arising before
or after the Effective Time), (i) BANC ONE shall pay expenses
(including attorney's fees and expenses) in advance of the final
disposition of any claim, suit, proceedings or investigation to each
Indemnified Party to the fullest extent permitted by applicable law,
and (ii) BANC ONE shall use its reasonable best efforts to vigorously
defend any such matter; provided, however, that BANC ONE's obligations
as herein set forth shall not apply to any losses, claims, damages,
liabilities, costs, expenses, judgments, fines and amounts paid in
settlement by any Indemnified Party involving the fraud, bad faith
and/or reckless disregard of such Indemnified Party or related to any
threatened or actual claim, action, suit, proceedings or investigation
brought by BANC ONE against any Indemnified Party. Any Indemnified
Party wishing to claim indemnification and defense under this Section
20(a) shall, upon the earlier to occur of (A) receiving actual notice
of any such claim, action, suit, proceeding or investigation, (B)
otherwise learning of such claim, action, suit, proceeding or
investigation or (C) receiving other information which would give a
reasonably prudent person reason to believe that such a claim, action,
suit, proceeding or investigation had or might be brought, notify BANC
ONE thereof as soon as reasonably practicable thereafter. BANC ONE's
obligations pursuant to this Section 20(a) are conditioned upon BANC
ONE being given prompt written notice of any such
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<PAGE>
claim, action, suit, proceeding or investigation, together with the
right to control and direct the investigation, defense and/or
settlement of each such matter, and further provided that the
Indemnified Party shall reasonably cooperate with BANC ONE in
connection therewith.
(b) BANC ONE shall insure that all rights to indemnification and defense
and all limitations of liability existing in favor of the Indemnified
Parties as provided in PREMIER's Articles of Incorporation and By-laws
or similar governing documents of any of its Subsidiaries, as in effect
as of February 20, 1991, or as otherwise provided for or allowed under
applicable law as in effect as of the date hereof or as such law is
amended at a time prior to the Effective Time, with respect to claims
or liabilities arising from facts or events existing or occurring prior
to the Effective Time, shall survive the Merger and shall continue in
full force and effect, without any amendment thereto, for a period of
ten (10) years from the Effective Time; provided, however, that all
rights to indemnification in respect of any claim asserted or made
within such period shall continue until the final disposition of such
claim.
(c) From and after the Effective Time, persons who, immediately prior to
the Effective Time, served as the directors, officers and employees of
PREMIER and its Subsidiaries, who, following the Effective Time,
continue as directors, officers and/or employees of the Surviving
Corporation or one of its subsidiaries, shall have indemnification and
defense rights having prospective application only, except, however,
for the indemnification and defense rights set forth in paragraphs (a)
and (b) of this Section 20. These prospective indemnification and
defense rights shall consist of (i) such rights to which directors,
officers and employees are entitled under the provisions of the
Articles of Incorporation, By-laws or similar governing documents of
the Surviving Corporation and its subsidiaries, as applicable, as in
effect from time to time after the Effective Time, as applicable,
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<PAGE>
and provisions of applicable law as in effect from time to time after
the Effective Time and (ii) those indemnification and defense rights
set forth in agreements, if any, between BANC ONE and the directors and
executive officers of the Surviving Corporation and its subsidiaries.
Such agreements, if any, which shall be executed as soon as practicable
following the Effective Time, shall provide certain indemnification and
defense rights that are comparable to those provided to directors,
officers and employees of BANC ONE and its subsidiaries generally, but
which rights may be greater or lesser than the indemnification and
defense rights available in clause (i) above.
(d) The obligations of BANC ONE and PAC provided under paragraphs (a) and
(b) of this Section 20 are intended to be the joint and several
obligations of BANC ONE and the Surviving Corporation and to benefit,
and be enforceable against BANC ONE and the Surviving Corporation
directly by the Indemnified Parties, and shall be binding on all
respective successors and permitted assigns of BANC ONE and the
Surviving Corporation.
(e) In the event BANC ONE or the Surviving Corporation or any of its
successors or assigns (i) consolidates with or merges into any other
person and shall not be the continuing or surviving corporation or
entity of such consolidation or merger, or (ii) transfers or conveys
all or substantially all of its properties and assets to any person,
then, and in each such case, proper provision shall be made so that the
successors and assigns of BANC ONE or the Surviving Corporation, as the
case may be, assume the obligations set forth in this Section 20.
21. Non-Survival of Representations and Warranties. The respective
----------------------------------------------
representations and warranties of PREMIER, BANC ONE and PAC contained in
this Merger Agreement shall not survive the Effective Time.
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<PAGE>
22. Governing Law. This Merger Agreement shall be construed and interpreted
-------------
according to the applicable laws of the State of Louisiana, except as the
laws of the State of Ohio are expressly applicable to the Merger.
23. Assignment. This Merger Agreement and all of the provisions hereof shall
----------
be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns, but neither this Merger
Agreement nor any of the rights, interests, or obligations hereunder shall
be assigned by any of the parties hereto without the prior written consent
of the other parties.
24. Satisfaction of Conditions; Termination.
---------------------------------------
(a) BANC ONE and PAC agree to use their best efforts to obtain satisfaction
of the conditions of this Merger Agreement insofar as they relate to
BANC ONE and PAC, and PREMIER agrees to use its best efforts to obtain
the satisfaction of the conditions of this Merger Agreement insofar as
they relate to PREMIER, and in each case as soon as possible.
(b) At any time prior to the Effective Time, whether before or after
approval of the Merger by BANC ONE, as the sole shareholder of PAC, or
by PREMIER's shareholders, this Merger Agreement may be terminated upon
the occurrence of any of the following by written notice from BANC ONE
to PREMIER (authorized by the Board of Directors of BANC ONE), or by
written notice from PREMIER to BANC ONE (authorized by the Board of
Directors of PREMIER), as the case may be:
(i) By BANC ONE, if any material condition to the obligations of BANC
ONE and/or PAC set forth in Section 17 or 19 is not substantially
satisfied at the time or times contemplated thereby and such
condition is not waived
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<PAGE>
by BANC ONE, or by PREMIER, if any material condition to the
obligations of PREMIER set forth in Section 18 or 19 is not
substantially satisfied at the time or times contemplated thereby
and such condition is not waived by PREMIER;
(ii) In the event of a material breach by the other of any
representation, warranty, condition or agreement contained in
this Merger Agreement that is not cured within 30 days of the
time that written notice of such breach is received by such other
party from the party giving notice; or
(iii) If the Merger shall not have been consummated on or before July
1, 1996.
(c) In the event that PREMIER fails to deliver the PREMIER Disclosure
Letter to BANC ONE as set forth in Section 15(i) of this Merger
Agreement, BANC ONE may, upon written notice to PREMIER, terminate this
Merger Agreement; provided, however that notice of termination because
of such failure of delivery must be given by BANC ONE to PREMIER within
thirteen business days of the date of this Merger Agreement. If, upon
BANC ONE's review of the PREMIER Disclosure Letter delivered to BANC
ONE as required by Section 15(i), BANC ONE determines, in its sole
discretion, not to proceed with the Merger Agreement, BANC ONE may,
upon written notice to PREMIER, terminate this Merger Agreement;
provided, however, that BANC ONE shall complete its review of the
PREMIER Disclosure Letter and give PREMIER written notice of whether it
will or will not terminate the Merger Agreement pursuant to this
paragraph as soon as reasonably possible and, in any event, within ten
business days following the date on which the PREMIER Disclosure Letter
is received by BANC ONE.
In the event that the pre-acquisition investigation and review
described in Section 10(n) of this Merger Agreement discloses matters
which BANC ONE in good faith
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<PAGE>
believes to be either (i) inconsistent in any material respect with any
of the representations and warranties of PREMIER contained in this
Agreement or (ii) in the reasonable judgment of the Board of Directors
of BANC ONE, to be either (x) of such significance as to materially and
adversely affect the financial condition or the results of operations
of PREMIER and its Subsidiaries on a consolidated basis or (y) to
deviate materially and adversely from PREMIER's audited financial
statements for the year ended December 31, 1994 or PREMIER's unaudited
financials for the three-month period ended June 30, 1995, BANC ONE may
elect to terminate this Merger Agreement by giving written notice of
termination to PREMIER within seven days of the conclusion of such pre-
acquisition investigation.
(d) In the event that the pre-acquisition investigation and review
described in Section 10(o) of this Merger Agreement discloses matters
which PREMIER in good faith believes to be either (i) inconsistent in
any material respect with any of the representations and warranties of
BANC ONE contained in this Agreement or (ii) in the reasonable judgment
of the Board of Directors of PREMIER, to be either (x) of such
significance as to materially and adversely affect the financial
condition or the results of operations of BANC ONE and its subsidiaries
on a consolidated basis or (y) to deviate materially and adversely from
BANC ONE's audited financial statements for the year ended December 31,
1994 or BANC ONE's unaudited financials for the three-month period
ended June 30, 1995, PREMIER may elect to terminate this Merger
Agreement by giving written notice of termination to PREMIER within
seven days of the conclusion of such pre-acquisition investigation.
(e) This Merger Agreement may be terminated and abandoned (whether before
or after approval of the Merger by the shareholder of PAC or by
PREMIER's
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<PAGE>
shareholders) by mutual written consent of PREMIER, PAC and BANC ONE
authorized by their respective Boards of Directors.
(f) In the event of termination of this Merger Agreement for any reason,
including, but not limited to, the failure to receive the approval of
PREMIER's shareholders, the failure to receive or the withdrawal prior
to the Effective Time of the fairness opinion described in Section
18(i) of this Merger Agreement, or the failure of PREMIER to deliver
the PREMIER Disclosure Letter as set forth in Section 15(i) of this
Merger Agreement or BANC ONE's termination pursuant to the provisions
of Section 24(c), (i) this Merger Agreement shall cease and terminate
and the acquisition of PREMIER shall not be consummated pursuant to the
terms of this Merger Agreement and (ii) the 1992 Agreement, the Warrant
Agreement, the Amended and Restated Capital Note Agreement dated March
26, 1992 by and between PREMIER and BANC ONE (the "Capital Note
Agreement") and the related Subordinated Term Capital Note dated March
25, 1992 of PREMIER to BANC ONE (the "Capital Note") shall remain in
full force and effect without modification or amendment as more fully
set forth in Section 26.
Additionally, in the event of termination of this Merger Agreement
caused otherwise than by a willful breach of this Merger Agreement,
none of BANC ONE, PAC nor PREMIER shall have any liability to any other
party under this Merger Agreement of any nature whatever, except for
(i) obligations to pay expenses expressly assumed by BANC ONE in
Section 10(e) and (ii) the obligations of the parties with respect to
confidential information as set forth in Section 10(f), which
obligations shall survive any such termination.
(g) If termination of this Merger Agreement shall be judicially determined
to have been caused by willful breach of this Merger Agreement, in
addition to other remedies at law or equity for breach of this Merger
Agreement, the party so found
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<PAGE>
to have willfully breached this Merger Agreement shall indemnify the
other parties for their respective costs, fees and expenses of their
counsel, accountants and other experts and advisors as well as fees and
expenses incident to negotiation, preparation and execution of this
Merger Agreement and related documentation and their shareholders'
meetings and consents.
25. Waivers; Amendments. Any of the provisions of this Merger Agreement may
-------------------
be waived at any time by the party which is, or the shareholders of which
are, entitled to the benefit thereof. This Merger Agreement may be amended
or modified in whole or in part by an agreement in writing executed in the
same manner (but not necessarily by the same persons) as this Merger
Agreement and which makes reference to this Merger Agreement; provided,
however, such amendment or modification may be made only following due
authorization by the respective Boards of Directors of PREMIER, PAC and BANC
ONE; provided, further, however, that after a favorable vote by the
shareholders of PREMIER any such action shall be taken by PREMIER only if,
in the opinion of its Board of Directors, such amendment or modification
will not have any material adverse effect on the benefits intended under
this Merger Agreement for the shareholders of PREMIER, will not violate
Section 112H(2) of the Louisiana BCL, and will not require resolicitation of
any proxies from such shareholders.
26. Entire Agreement and 1992 Agreement. Subject to the exceptions noted in
-----------------------------------
this Section 26, this Merger Agreement supersedes any other agreement,
whether written or oral, that may have been made or entered into by PREMIER,
PAC and BANC ONE or by any officer or officers of such parties relating to
the acquisition of the business or the capital stock of PREMIER and/or its
Subsidiaries by BANC ONE or PAC. Except for the BANC ONE Disclosure Letter
and any attachments thereto, the PREMIER Disclosure Letter and any
attachments thereto, the Benefits Agreement addressing benefit plans and
policies, and the 1992 Agreement, the Warrant Agreement, the Capital Note
Agreement and the Capital Note, this Merger Agreement and the exhibits
hereto constitute the entire
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<PAGE>
agreement by the parties, and there are no agreements or commitments except
as set forth herein and therein.
Until this Merger Agreement is terminated pursuant to the provisions of
Section 24 or the Merger becomes effective pursuant hereto, this Merger
Agreement supersedes the 1992 Agreement, the Warrant Agreement and any other
agreement related to the 1992 Agreement, other than the Capital Note
Agreement and related Capital Note. In the event that this Merger Agreement
is terminated or if, for any reason, the Merger does not, pursuant to this
Merger Agreement, become effective, the 1992 Agreement, the Warrant
Agreement, the Capital Note Agreement, the Capital Note and any other
agreement related to the 1992 Agreement shall remain in full force and
effect, without amendment, and the parties shall have the rights and
obligations therein set forth. If the Merger becomes effective pursuant to
this Merger Agreement, the 1992 Agreement, the Warrant Agreement and any
related agreement shall become null and void and shall have no force and
effect; provided, however, the Capital Note Agreement and the related
Capital Note will remain in full force and effect. It is the intent of the
parties that until the Merger becomes effective pursuant to this Merger
Agreement, none of the 1992 Agreement, the Warrant Agreement, the Capital
Note Agreement, the Capital Note or other agreement between BANC ONE and
PREMIER of even date therewith shall be vacated or otherwise terminated as a
result of this Merger Agreement and/or any provision of this Merger
Agreement.
27. Captions; Counterparts. The captions in this Merger Agreement are for
----------------------
convenience only and shall not be considered a part of or affect the
construction or interpretation of any provision of this Merger Agreement.
This Merger Agreement may be executed in several counterparts, each of which
shall constitute one and the same instrument.
28. Notices. Any notice or other communication given under this Merger
-------
Agreement shall be in writing, and shall be deemed duly delivered when
received upon delivery either
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<PAGE>
(i) by hand, (ii) by telegram or facsimile transmission, (iii) by a
nationally recognized overnight courier service, or (iv) by registered or
certified mail, postage prepaid, addressed as set forth below.
(a) If to BANC ONE, to:
BANC ONE CORPORATION
Attention of: Chief Executive Officer
100 East Broad Street
Columbus, Ohio 43271
With a copy to:
BANC ONE CORPORATION
Attention of: Steven Alan Bennett
General Counsel
100 East Broad Street
Columbus, Ohio 43271
(b) If to PREMIER, to:
Premier Bancorp, Inc.
Attention of: Chief Executive Officer
451 Florida Street
Baton Rouge, Louisiana 70801
With a copy to:
Premier Bancorp, Inc.
Attention: General Counsel
451 Florida Street
Baton Rouge, Louisiana 70801
(c) If to PAC, to:
Premier Acquisition Corporation
Attention of: William P. Boardman
Chairman
100 East Broad Street
Columbus, Ohio 43271
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<PAGE>
IN WITNESS WHEREOF, this Merger Agreement has been executed the day and year
first above written.
BANC ONE CORPORATION
ATTEST:
/s/ Charles F Andrews By: /s/ William P. Boardman
- -------------------------------- --------------------------------
Charles F. Andrews William P. Boardman
Assistant Secretary Senior Executive Vice President
Premier Bancorp, Inc.
ATTEST:
/s/ James H. Napper, II By: /s/ G. Lee Griffin
- -------------------------------- --------------------------------
James H. Napper, II G. Lee Griffin
Secretary Chief Executive Officer
Premier Acquisition Corporation
ATTEST:
/s/ Charles F. Andrews By: /s/ William P. Boardman
- -------------------------------- --------------------------------
Charles F. Andrews William P. Boardman
Secretary Chairman
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<PAGE>
EXHIBITS TO AGREEMENT AND PLAN OF MERGER
----------------------------------------
Exhibit A - PREMIER Subsidiaries List
Exhibit B - Form of Affiliate Agreement
Exhibit C - Opinion of Counsel for PREMIER
Exhibit D - Opinion of Counsel for BANC ONE and PAC
<PAGE>
EXHIBIT A
---------
List of Subsidiaries
of
PREMIER BANCORP, INC. (1)
-------------------------
Premier Bank, National Association -- Jurisdiction, United States 1933. Member
of the Federal Reserve System.
Premier Leasing Corporation -- Incorporated in Louisiana -- 12/28/62.
Subsidiary of Premier Bank, engages in vehicle and equipment leasing.
Louisiana National Leasing Corporation of Texas -- Incorporated in Texas --
5/13/82. Inactive subsidiary of Premier Leasing Corporation.
Tri-State Minerals, Inc. -- Incorporated in Louisiana -- 6/19/86. Premier Bank
acquired the stock through foreclosure, holds title to various oil and gas
producing properties; dividends minimal amounts of royalities to Premier Bank
from time to time.
Pyramid Land & Investment Company -- Incorporated in Louisiana. Inactive
subsidiary of Tri-State Minerals, Inc. acquired through foreclosure, formerly
held title to various oil and gas producing properties.
Premier Mortgage Company, L.C. -- Limited Liability Company in Lousiana --
12/30/93. Subsidiary of Premier Bank (99.9% ownership), engages in the
origination and servicing of residential mortgage loans.
Premier Venture Capital Corporation, II -- Incoporated in Louisiana -- 11/12/93.
Subsidiary of Premier Bank, small business investment corporation organized to
provide start-up capital for small high-technology companies located in
Louisiana.
Louisiana Credit Life Agency, Inc. -- Incorporated in Louisiana -- 4/19/84.
Inactive subsidiary of Premier Bank, established to engage in credit/mortgage
insurance business.
Louisiana Credit Life Insurance Co., Inc. -- Incorporated in Arizona --
12/12/83. Subsidiary of Premier Bank, engages in underwriting, as reinsurer, of
credit/mortgage life and credit/mortgage disability insurance.
Premier LLC, Inc. -- Incorporated in Lousiana -- 3/2/84. Active subsidiary of
Premier Bank which holds .01% ownership in each of Premier Bank's limited
liability subsidiaries.
Terre Reality, Inc. -- Incorporated in Louisiana --5/5/88. Inactive subsidiary
of Premier Bank formerly held title to foreclosed property.
KSS, Inc. -- Incorporated in Louisiana -- 12/29/88. Subsidiary of Premier Bank,
holds title to oil field equipment acquired through foreclosure.
Premier Investment Advisors, L.L.C. -- Limited Liability Company in Louisiana --
12/30/93. Subsidiary of Premier Bank (99.9% ownership), provides investment
advisor services.
Premier Securities Corporation -- Incorporated in Louisiana -- 8/29/85.
Provides brokerage services to customers.
<PAGE>
Premier Acquisition, Inc. -- Incorporated in Louisiana -- 6/8/94. Formed in
connection with merger of Heritage Financial Corporation.
Terre Agency, Inc. -- Incorporated in Louisiana -- 6/7/76. Inactive subsidiary,
formerly acted as agent in the sale of credit life insurance.
Louisiana Bancshares, Inc. -- Incorporated in Louisiana -- 1/24/85. Name saver
subsidiary.
- ---------------
\1\ Unless otherwise noted above, all corporations are wholly-owned
subsidiaries of Premier Bancorp, Inc.
<PAGE>
EXHIBIT B
---------
(FORM OF AFFILIATE AGREEMENT)
AFFILIATE AGREEMENT
-------------------
, 1995
------------------
In consideration and anticipation of the receipt by the undersigned of Common
Stock of BANC ONE CORPORATION ("BANC ONE") upon consummation of a proposed
merger (the "Merger") of Premier Bancorp, Inc. ("PREMIER") and Premier
Acquisition Corporation, a subsidiary of BANC ONE, pursuant to the terms of a
certain Agreement and Plan of Merger dated , 1995, (the "Merger
----------
Agreement"), and in view of the fact that the undersigned has, pursuant to the
Merger Agreement, been identified as a possible "affiliate" of PREMIER within
the meaning of Rules 144 and 145 ("Rule 144" and "Rule 145," respectively), as
amended, of the General Rules and Regulations under the Securities Act of 1933,
as amended (the "1933 Act"), the undersigned (the "Affiliate") represents and
undertakes as follows:
The Affiliate shall not offer, sell or otherwise dispose of or transfer any of
the shares of the Common Stock of BANC ONE to be received by him upon
consummation of the Merger, including shares of BANC ONE Common Stock acquired
by the Affiliate within the two year period following the Merger as a result of
the Affiliate's exercise of options on BANC ONE Common Stock acquired in
substitution for unexercised options on PREMIER Common Stock, (the "Shares"),
except the Affiliate may offer, sell or transfer the Shares (1) in a manner and
to the extent permitted by the applicable provisions of Rule 145, (2) pursuant
to an effective registration statement relating to the Shares under the 1933
Act, or (3) in a transaction which, in the opinion of counsel for the Affiliate
or as described in a "no-action" or interpretive letter from the staff of the
Securities and Exchange Commission, in each case reasonably satisfactory in form
and substance to BANC ONE, is exempt from the registration requirements of the
1933 Act.
BANC ONE's transfer agents may be given appropriate instructions prohibiting
transfer of the Shares unless these provisions are complied with and the
certificate(s) for the Shares may bear a restrictive legend in substantially the
following form:
<PAGE>
The shares represented by this certificate have been issued to the registered
holder as a result of a transaction to which Rule 145 under the Securities Act
of 1933, as amended (the "1933 Act") applies. The shares represented by this
certificate may not be sold, transferred or assigned, and the issuer shall not
be required to give effect to any attempted sale, transfer or assignment, except
pursuant to (i) a registration statement then in effect under the 1933 Act, (ii)
a transaction permitted by Rule 145 as to which the issuer has received evidence
of compliance with the provisions of said Rule 145 reasonably satisfactory to it
or (iii) a transaction which, in the opinion of counsel for the Affiliate or as
described in a 'no action' or interpretive letter from the staff of the
Securities and Exchange Commission, in each case reasonably satisfactory in form
and substance to the issuer, is exempt from the registration requirements of the
1933 Act. The restrictions of this paragraph shall become null and void and
this paragraph shall have no effect on and after .
---------------
The undersigned undertakes to take such action as shall be necessary to cause
the Shares to be received by the undersigned to be registered in a manner that
will allow for the placement of a restrictive legend on the certificate(s)
representing such Shares.
IN WITNESS WHEREOF, the Affiliate has executed this Affiliate Agreement as of
the day and year first above written.
------------------------------------
<PAGE>
(OPINION OF COUNSEL FOR PREMIER) EXHIBIT C
---------
, 199
- ------------- -
BANC ONE CORPORATION
100 East Broad Street
Columbus, Ohio 43271
Gentlemen:
We are counsel to Premier Bancorp, Inc., a Louisiana corporation and a
registered bank holding company ("PREMIER") and have acted as counsel for
PREMIER in connection with the merger (the "Merger") of PREMIER with and into
Premier Acquisition Corporation ("PAC"), an Ohio corporation and a wholly owned
subsidiary of BANC ONE CORPORATION ("BANC ONE"), pursuant to which each of the
issued and outstanding shares of PREMIER's Common Stock will be converted into
shares of BANC ONE Common Stock. The Merger is to be consummated pursuant to
the terms of an Agreement and Plan of Merger dated , 1995 ("Merger
-------------
Agreement"), between PAC, PREMIER and BANC ONE. This opinion is furnished to
you pursuant to Section 17(d) of the Merger Agreement.
Except as otherwise indicated herein, capitalized terms used in this Opinion
Letter are defined in the Merger Agreement or the Legal Opinion Accord (the
"Accord") of the ABA Section of Business Law (1991), respectively. In the event
of any inconsistency between the definition of any such term in the Merger
Agreement and the Accord, the definition set forth in the Accord shall govern.
This Opinion Letter is governed by, and is to be interpreted in accordance with,
the Accord. As a consequence, it is subject to a number of qualifications,
exceptions, definitions, limitations on coverage, and other limitations, all as
more particularly described in the Accord, and this Opinion Letter should be
read in conjunction therewith.
The law covered by the opinions expressed herein is limited solely to the laws
of the State of Louisiana and the Federal Laws of the United States generally.
Based upon and subject to the foregoing, we are of the opinion that:
1. The Merger Agreement is enforceable against PREMIER.
<PAGE>
BANC ONE CORPORATION
, 1995
-----------
Page 2
2. Except as set forth in the PREMIER Disclosure Letter, the execution and
delivery by PREMIER of, and the performance by PREMIER of its agreements in,
the Merger Agreement does not (a) violate the respective Constituent
Documents of PREMIER; (b) violate applicable provisions of statutory law or
regulation; (c) breach or otherwise violate any existing obligation of
PREMIER under any Court Orders of which the Opinion Giver has Actual
Knowledge; or (d) to the Opinion Giver's Actual Knowledge, breach, or result
in a default under, any material obligation of PREMIER under a material
Other Agreement.
3. To the Opinion Giver's Actual Knowledge, there are no actions or proceedings
against PREMIER or any of its subsidiaries, pending or overtly threatened in
writing, before any court, governmental agency or arbitrator which seek to
affect the enforceability of the Merger Agreement.
The General Qualifications apply to each of the opinions set forth above.
We are rendering this opinion solely for the benefit of BANC ONE and PAC in
connection with the transactions described in the Merger Agreement. It may not
be relied upon by any other person or for any other person, or quoted or filed
with any regulatory agency without our prior approval.
Very truly yours,
- --------------------
- --------------------
<PAGE>
EXHIBIT D
---------
(OPINION OF COUNSEL FOR BANC ONE AND PAC)
, 199
- --------------- -
Premier Bancorp, Inc.
451 Florida Street
Baton Rouge, Louisiana 70801
Attention: Chairman
Gentlemen:
I am counsel for BANC ONE CORPORATION, an Ohio corporation and a registered bank
holding company ("BANC ONE"), and Premier Acquisition Corporation ("PAC"), an
Ohio corporation, registered bank holding company and wholly owned subsidiary of
BANC ONE. I have acted as counsel for BANC ONE and PAC in connection with the
merger (the "Merger") of Premier Bancorp, Inc. ("PREMIER") and PAC pursuant to
which each of the issued and outstanding shares of PREMIER Common Stock will be
converted into shares of BANC ONE Common Stock. Such Merger is to be
consummated pursuant to the terms of an Agreement and Plan of Merger dated
, 1995("Merger Agreement") between PREMIER, PAC and BANC ONE. This
- -----------
opinion is furnished to you pursuant to Section 18(c) of the Merger Agreement.
Except as otherwise indicated herein, capitalized terms used in this Opinion
Letter are defined in the Merger Agreement or the Legal Opinion Accord (the
"Accord") of the ABA Section of Business Law (1991), respectively. In the event
of any inconsistency between the definition of any such term in the Merger
Agreement and the Accord, the definition set forth in the Accord shall govern.
This Opinion Letter is governed by, and is to be interpreted in accordance with,
the Accord. As a consequence, it is subject to a number of qualifications,
exceptions, definitions, limitations on coverage, and other limitations, all as
more particularly described in the Accord, and this Opinion Letter should be
read in conjunction therewith.
The law covered by the opinions expressed herein is limited solely to the laws
of the State of Ohio and the Federal Laws of the United States generally.
Based upon and subject to the foregoing, I am of the opinion that:
<PAGE>
Premier Bancorp, Inc.
, 1995
------------
Page 3
1. The Merger Agreement is enforceable against BANC ONE.
2. The Merger Agreement is enforceable against PAC.
3. Except as set forth in the BANC ONE Disclosure Letter, the execution and
delivery by BANC ONE and PAC of, and the performance by BANC ONE and PAC of
their agreements in, the Merger Agreement does not (a) violate the respective
Constituent Documents of BANC ONE and PAC; (b) violate applicable provisions
of statutory law or regulation; (c) breach or otherwise violate any existing
obligation of BANC ONE or PAC under any Court Orders of which the Opinion
Giver has Actual Knowledge; or (d) breach, or result in a default under, any
material obligation of BANC ONE or PAC under a material Other Agreement of
which the Opinion Giver has Actual Knowledge.
4. Insofar as I am aware, the conditions to obligations of PREMIER as set forth
in the Merger Agreement have been satisfied or waived by PREMIER and the
representations and warranties of BANC ONE and PAC as set forth in the Merger
Agreement were true as of the date of the Merger Agreement and are, to the
extent required by Section 18(b) of the Merger Agreement, true as of the date
hereof.
5. To the best of my actual knowledge, I hereby confirm to you, pursuant to the
requirements of Section 12(f) of the Merger Agreement, that there are no
actions or proceedings against BANC ONE or any of its subsidiaries, pending
or overtly threatened in writing, before any court, governmental agency or
arbitrator which (i) seek to affect the enforceability of the Merger
Agreement or (ii) come within the objective standard established in the
Merger Agreement for disclosure, except as set forth in the BANC ONE
Disclosure Letter.
6. I have participated in the preparation of the Registration Statement on Form
S-4 or other appropriate registration statement form (No. ) of
------------
BANC ONE ("Registration Statement"), and in rendering this opinion have
limited my review of the facts concerning the Registration Statement to
discussions with and inquiry of Directors, officers and employees of BANC
ONE, and Coopers & Lybrand, the independent accountants who examined certain
of the financial statements of BANC ONE included in the Registration
Statement, and based thereon and subject to the General Qualifications, I am
of the opinion that such Registration Statement, and the Prospectus included
in the Registration Statement (except as to financial statements, other
financial data and any information concerning PREMIER included therein, as to
which I express no opinion) at the time the Registration Statement became
effective under the Securities Act of 1933 (the "1933 Act") complied as to
form in all material respects with the 1933 Act and the rules and regulations
of the Securities and Exchange Commission thereunder.
<PAGE>
Premier Bancorp, Inc.
, 1995
- -----------
Page 4
7. I confirm that the Registration Statement has become effective under the 1933
Act, and to the best of my Actual Knowledge, no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been instituted or are pending or
contemplated under the 1933 Act.
8. I have not checked the accuracy or completeness of, or otherwise verified,
any statement of fact contained in the Registration Statement and Prospectus.
Based on the participations, discussions and inquiries described above,
however, I have no reason to believe that the Registration Statement (except
as to financial statements, other financial data and any information
concerning PREMIER included therein, as to which no view is expressed) at the
time it became effective and as of the date of this letter contained any
untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the statements
therein not misleading, or that the Prospectus (except as to financial
statements, other financial data and any information concerning PREMIER
included therein, as to which no view is expressed) at such times contained
any untrue statement of a material fact or omitted to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading or that since the
effective date of the Registration Statement, any event has occurred which
should have been set forth in an amendment or supplement to the Registration
Statement or the Prospectus which has not been set forth in such an amendment
or supplement.
The General Qualifications apply to all of the opinions set forth above.
I am rendering this opinion solely for the benefit of BANC ONE and PAC in
connection with the transactions described in the Merger Agreement. It may not
be relied upon by any other person or for any other person, or quoted or filed
with any regulatory agency without my prior approval.
Very truly yours,
- -----------------------
- -----------------------
<PAGE>
EXHIBIT 2.2
FIRST AMENDMENT TO
AGREEMENT AND PLAN OF MERGER
This First Amendment to Agreement and Plan of Merger ("First Amendment") between
Premier Bancorp, Inc. (hereinafter called "PREMIER"), Premier Acquisition
Corporation (hereinafter called "PAC") and BANC ONE CORPORATION (hereinafter
called "BANC ONE") is dated as of September 7, 1995.
-----------
WITNESSETH
WHEREAS, the parties hereto have entered into an Agreement and Plan of Merger
dated as of July 19, 1995 (hereinafter, the "Merger Agreement") providing for
the merger of PREMIER into PAC, BANC ONE's acquisition of PREMIER and the
exchange of shares of BANC ONE Common Stock for the shares of PREMIER Common
Stock;
WHEREAS, the parties have determined that under applicable Louisiana law
certain rights may be available to shareholders of PREMIER as dissenting
shareholders and that it is desirable that the Merger Agreement be amended with
respect thereto.
STATEMENT OF AMENDMENT
NOW THEREFORE, the parties hereby agree that the Merger Agreement shall be and
is hereby amended as follows:
A. Section 6 of the Merger Agreement is amended to read in its entirety as
follows:
6. Liabilities upon Merger; Service of Process. The Surviving Corporation
-------------------------------------------
shall be responsible for all of the liabilities of every kind and
description of PREMIER and PAC existing as of the Effective Time.
The filing of a Certificate of Merger with the Secretary of State of the
State of Louisiana, accompanied by such other documents as are required
by the Louisiana BCL, shall operate as a consent by the Surviving
Corporation that it may be sued and served with process in the State of
Louisiana in any suit, action or proceeding for the enforcement of any
obligation or liability of PREMIER, including any amount payable to any
dissenting shareholder; as an irrevocable consent by the Surviving
Corporation to service upon and by the Louisiana Secretary of State as
agent of the Surviving Corporation to accept service of process in any
such suit, action or proceeding for the enforcement of any such
obligation or liability; and as an appointment by the Surviving
Corporation of James H. Napper, II whose address is 451 Florida Street,
Baton Rouge, Louisiana 70801, as agent of the Surviving Corporation for
service of process in any action, suit or proceeding to enforce any such
obligation or liability of
<PAGE>
PREMIER, to whom the Louisiana Secretary of State may mail a copy of any
such process served upon the Louisiana Secretary of State.
B. Section 7(a)(i) of the Merger Agreement is amended to read in its entirety
as follows:
(i) Each share of PREMIER Common that is issued and outstanding immediately
prior to the Effective Time, together with any and all PREMIER Common
Stock purchase rights and related interests and rights associated with
each such share of PREMIER Common ("Rights") arising from, related to
and/or issued pursuant to the Rights Agreement dated January 18, 1989
between PREMIER and Premier Bank, N.A., as Rights Agent (the "PREMIER
Rights Plan"), except for shares of PREMIER Common and Rights related
thereto subject to the rights of a dissenting shareholder, if any,
shall, by virtue of the Merger and without any action on the part of the
holder thereof, thereupon be converted into 0.617761 share of BANC ONE
Common subject, however, to (i) the anti-dilution provisions of Section
7(e) of this Merger Agreement and (ii) provisions set forth in Section
7(c) with respect to fractional shares (the "Exchange Rate").
C. The first paragraph of Section 7(d) of the Merger Agreement is amended to
read in its entirety as follows:
(d) As soon as practicable after the Effective Time, and subject to the
provisions set forth above relating to fractional shares, BANC ONE will,
or will cause Harris Trust and Savings Bank, as Exchange Agent for BANC
ONE to, distribute to the former holders of PREMIER Common (or their
respective designees) in exchange for and upon surrender for
cancellation by such holders of a certificate or certificates formerly
representing shares of PREMIER Common and Rights issued pursuant to the
PREMIER Rights Plan, the certificate(s) for shares of BANC ONE Common in
accordance with the Exchange Rate. Each certificate formerly
representing PREMIER Common and Rights issued pursuant to the PREMIER
Rights Plan (other than certificates representing shares of PREMIER
Common subject to the rights of dissenting shareholders, if any) shall
be deemed for all purposes to evidence the ownership of the number of
shares of BANC ONE Common into which such shares have been converted
pursuant to the Exchange Rate; provided, however, that, until such
surrender of a holder's certificate or certificates formerly
representing shares of PREMIER Common and Rights issued pursuant to the
PREMIER Rights Plan, the holder thereof shall not be entitled to receive
any dividend or other payment or distribution payable to holders of BANC
ONE Common. Upon such surrender (or, in lieu of surrender, other
provisions reasonably satisfactory to BANC ONE as are made as set forth
in the next following paragraph), there shall be paid to the person
entitled thereto the aggregate amount of dividends or other payments or
distributions (in each
-2-
<PAGE>
case without interest) which became payable after the Effective Time, to
the extent not previously paid to such person, on the whole shares of
BANC ONE Common represented by the certificates issued upon such
surrender and exchange or in accordance with such other provisions, as
the case may be. After the Effective Time the holders of certificates
formerly representing shares of PREMIER Common and Rights issued
pursuant to the PREMIER Rights Plan shall cease to have rights with
respect to such shares and to any related Rights (except such rights, if
any, as holders of certificates representing PREMIER Common may have as
dissenting shareholders) and their sole right shall be to exchange said
certificates for shares of BANC ONE Common and any fractional share
payment in accordance with this Merger Agreement.
D. A new subsection (f) is added to Section 7 of the Merger Agreement to read
in its entirety as follows:
(f) If any shareholder of PREMIER Common who files appropriate written
objection pursuant to applicable law and thereafter votes his shares
against the Merger is entitled to dissenters' rights under applicable
law, if such shareholder perfects applicable dissenters' rights, if any,
such shareholder will be entitled to dissenters rights under the
Louisiana BCL.
E. Section 11(c) of the Merger Agreement is amended to read in its entirety as
follows:
(c) No gain or loss will be recognized to the shareholders of PREMIER on the
exchange of their shares of PREMIER Common for shares of BANC ONE Common
(disregarding for this purpose any cash received pursuant to the
exercise of statutory dissenters' rights or in lieu of fractional share
interests);
F. The first paragraph of Section 15(a)(ii) of the Merger Agreement is amended
to read in its entirety as follows:
(ii) except as hereinbelow provided, will not declare or pay any dividends
or make any distributions in any amount on its PREMIER Common in the
quarter in which the Effective Time shall occur and for which quarter
the shareholders of PREMIER Common are entitled to receive regular
quarterly dividends on the shares of BANC ONE Common into which the
shares of PREMIER Common have been converted. It is the intent of this
part (ii) to provide that, except for PREMIER shareholders who have
exercised applicable dissenters' rights and who will, as a result, not
exchange their shares of PREMIER Common for shares of BANC ONE Common,
the holders of PREMIER Common will receive either the payment of cash
dividends on their shares of PREMIER Common or the payment of cash
dividends as the holders of shares of BANC ONE Common received in
exchange for the shares of PREMIER Common for
-3-
<PAGE>
the calendar quarter during which the Effective Time shall occur, but
will not receive and will not become entitled to receive for the same
calendar quarter both the payment of a cash dividend as shareholders of
PREMIER and the payment of a cash dividend as the holders of the shares
of BANC ONE Common received in exchange for the shares of PREMIER
Common. In the event that PREMIER does not declare and pay cash
dividends on its PREMIER Common in a particular calendar quarter
because of PREMIER's reasonable expectation that the Effective Time
would occur in said calendar quarter wherein the holders of PREMIER
Common would have become entitled to receive cash dividends for such
calendar quarter on the shares of BANC ONE Common to have been
exchanged for the shares of PREMIER Common, and the Effective Time does
not in fact occur effective in said calendar quarter, then, as a result
thereof, PREMIER shall be entitled to declare and pay a cash dividend
(within the limitations of this Section 15) on said shares of PREMIER
Common for said calendar quarter as soon as reasonably practicable.
Except as amended by this First Amendment, the Merger Agreement and the exhibits
thereto remain in full force and effect without alteration or change. All
references to "Merger Agreement" in the Merger Agreement as originally executed
shall mean the Merger Agreement as amended by this First Amendment.
IN WITNESS WHEREOF, the parties hereto have set their hands to this First
Amendment on the date and in the year first above written.
BANC ONE CORPORATION
ATTEST:
By:/s/ William P. Boardman
--------------------------------
William P. Boardman
/s/ Charles F. Andrews Senior Executive Vice President
------------------
Premier Bancorp, Inc.
ATTEST:
By:/s/ G. Lee Griffin
--------------------------------
G. Lee Griffin
/s/ James H. Napper, II Chief Executive Officer
--------------------
Premier Acquisition Corporation
ATTEST:
By:/s/ William P. Boardman
--------------------------------
William P. Boardman
/s/ Charles F. Andrews Chairman
------------------
-4-
<PAGE>
EXHIBIT 5
October 5, 1995
To: The Board of Directors of
BANC ONE CORPORATION
This opinion is being provided by the undersigned, as General Counsel of BANC
ONE CORPORATION ("BANC ONE"). In such capacity I, or attorneys under my
supervision, have represented BANC ONE in connection with the Registration
Statement on Form S-4 (the "Registration Statement") to be filed by BANC ONE
with the Securities and Exchange Commission under the Securities Act of 1933, as
amended. The Registration Statement relates to the issuance of up to 21,861,840
shares of the common stock, no par value ($5 stated value) per share, of BANC
ONE (the "Shares") in connection with the proposed merger (the "Merger") of
Premier Bancorp, Inc. ("Premier") with and into Premier Acquisition Corporation
("PAC"), a wholly owned subsidiary of BANC ONE, pursuant to the terms of the
Agreement and Plan of Merger dated as of July 19, 1995 by and among Premier,
BANC ONE and PAC, as amended as of September 7, 1995 (the "Merger Agreement").
In rendering the opinions set forth below, I or attorneys under my supervision
have examined originals, or copies certified or otherwise identified to my
satisfaction, of such documents, corporate records and other instruments as I
have deemed necessary or appropriate for the purposes of this opinion, including
without limitation the Merger Agreement.
Based upon and subject to the foregoing and after examination of such matters of
law as I have deemed applicable or relevant to this opinion, I am of the opinion
that, upon effectiveness of the Registration Statement and the satisfaction of
certain conditions provided for in the Merger Agreement, the Shares, when issued
and delivered pursuant to the provisions of the Merger Agreement and upon
consummation of the Merger, will be validly issued, fully paid and non-
assessable.
<PAGE>
The Board of Directors of
BANC ONE CORPORATION
October 5, 1995
Page 2
The opinions expressed herein are limited to the laws of the State of Ohio and
the federal laws of the United States of America. I hereby consent to (i) the
use and filing of this opinion as an exhibit to the Registration Statement and
to the reference to this opinion under the heading "Legal Matters" in any
prospectus filed in connection with the Registration Statement and (ii) the
incorporation by reference of this opinion into a subsequent registration
statement filed by BANC ONE pursuant to Rule 462(b) under the Securities Act
relating to the offering covered by the Registration Statement. In giving such
consent, I do not thereby admit that I come within the category of persons whose
consent is required under Section 7 of the Securities Act of 1933 or the General
Rules and Regulations thereunder.
Very truly yours,
/s/ Steven Alan Bennett
Steven Alan Bennett
Senior Vice President and General Counsel
<PAGE>
<TABLE>
<S> <C> <C> <C>
| | Coopers & Lybrand L.L.P. | 100 East Broad Street | telephone (614) 225-8700
| [Logo of | | Suite 2100 |
| Coopers | | Columbus, Ohio 43215-3671 | facsimile (614) 224-1044
| & Lybrand] | a professional services firm
</TABLE>
October 5, 1995
Mr. Charles F. Andrews
Assistant General Counsel
BANC ONE CORPORATION
100 East Broad Street
Columbus, Ohio 43271-0261
RE: Federal Income Tax Effects of Proposed Merger between Premier Bancorp,
Inc., Premier Acquisition Corporation, and BANC ONE CORPORATION
To Premier Bancorp, the Shareholders of Premier Bancorp, and BANC ONE
CORPORATION:
Pursuant to your request and as required by Section 11 of the Agreement and Plan
of Merger entered into between Premier Bancorp, Inc., Premier Acquisition
Corporation, and BANC ONE CORPORATION on or about July 19, 1995, as amended by
the First Amendment To Agreement and Plan of Merger entered into on or about
September 7, 1995, we are providing our opinion of the Federal income tax
consequences of the transaction described herein. Unless otherwise noted, all
Section references herein shall be to the Internal Revenue Code of 1986, as
amended (the "Code"), and the regulations thereunder.
FACTS
- -----
A. Introduction of Parties to the Proposed Transaction
1. Premier Bancorp, Inc. ("PREMIER")
---------------------------------
PREMIER is a corporation duly organized under the laws of the State of Louisiana
and a registered bank holding company under the Bank Holding Company Act of
1956, as amended. As of July 19, 1995, the authorized capital stock of PREMIER
consisted of 100,000,000 shares of common stock without par value, $5.00 stated
value, 33,828,969 shares of which were issued and outstanding, not including
46,000 shares of treasury stock owned by PREMIER; and 10,000,000 shares of
PREMIER preferred stock, none of which were issued and outstanding. As of July
19, 1995, there were no outstanding options, warrants, or commitments of any
kind related to PREMIER's capital stock, and no rights plan or other similar
plan related to PREMIER's capital stock except for (i) options for not more than
1,132,090 shares of PREMIER common issued to officers and employees of PREMIER
Coopers & Lybrand L.L.P. is a member of Coopers & Lybrand International,
a limited liability association incorporated in Switzerland.
<PAGE>
BANC ONE CORPORATION
Page 2
October 5, 1995
and its subsidiaries related to the PREMIER Stock Option Plan; (ii) certain
rights and interests granted to BANC ONE by PREMIER pursuant to the Amended and
Restated Agreement and Plan of Acquisition dated as of March 26, 1992 between
BANC ONE and PREMIER, as amended by the First Amendment to Amended and Restated
Agreement and Plan of Acquisition dated as of April 25, 1995 (together, the
"1992 Agreement"); (iii) a commitment to issue not more than 427,773 shares of
PREMIER common in exchange for all of the capital stock of HNB Corporation; (iv)
shares issuable pursuant to the Warrant Agreement dated as of March 26, 1992
between BANC ONE and PREMIER (the "Warrant Agreement"); and (v) Rights issued or
issuable pursuant to the PREMIER Rights Plan.
2. Premier Acquisition Corporation ("PAC")
---------------------------------------
PAC is a corporation duly organized under the laws of the State of Ohio. As of
July 19, 1995, the authorized capital stock of PAC consisted of 500 shares of
common stock without par value, all of which were issued and outstanding and
owned, of record and beneficially, by BANC ONE CORPORATION.
3. BANC ONE CORPORATION ("BANC ONE")
---------------------------------
BANC ONE is a corporation duly organized under the laws of the State of Ohio and
a registered bank holding company under the Bank Holding Company Act of 1956, as
amended. As of June 30, 1995, the authorized common stock of BANC ONE consisted
of 600,000,000 shares of common stock without par value, 410,290,638 of which
were issued and outstanding and 18,000,000 of which were shares of treasury
stock owned by BANC ONE. The authorized preferred stock consisted of 35,000,000
shares without par value, 4,997,499 shares of which were issued and outstanding
as Series C $3.50 Cumulative Convertible Preferred Stock.
B. Proposed Transaction Between the Parties
At the effective date of the Merger of PREMIER into PAC ("EFFECTIVE TIME"), in
accordance with and pursuant to the Louisiana Business Corporation Law and the
General Corporation Law of the State of Ohio, BANC ONE will indirectly acquire
the assets and liabilities of PREMIER through its wholly-owned subsidiary, PAC.
Specifically, the Agreement and Plan of Merger provides: "It is understood by
each of the parties hereto that BANC ONE seeks, as a result of the Merger, to
acquire PREMIER, the Banks and the Companies and all of their respective
operating assets and liabilities."
At the EFFECTIVE TIME, the separate corporate existence of PREMIER and PAC,
respectively, shall be merged into and continued in PAC as the surviving
corporation. All rights, franchises and interests of PREMIER and PAC,
respectively, in and to every type of property, real, personal, and mixed, and
choses in action, shall be transferred to and vested in PAC as the Surviving
Corporation.
<PAGE>
BANC ONE CORPORATION
Page 3
October 5, 1995
Under the terms of the Agreement and Plan of Merger, the name of the Surviving
Corporation shall be "Banc One Louisiana Corporation."
The Merger shall be effective at the date in accordance with Section 10(c) of
the Agreement and Plan of Merger. Unless another date is agreed upon, the
closing shall take place on the last business day of a month which first occurs
on or after the later of (i) the expiration of any required waiting period
following the approval of the consummation of the Merger by the Board of
Governors of the Federal Reserve System and Louisiana Commissioner of Financial
Institutions, (ii) the date of the meeting of shareholders of PREMIER to approve
the Merger or (iii) the business day following the satisfaction or waiver of all
conditions to the Merger.
At the EFFECTIVE TIME, each of the issued and outstanding shares of PREMIER
common stock immediately prior to the EFFECTIVE TIME, together with any and all
PREMIER common stock purchase rights and related interests and rights associated
with each such share of PREMIER common stock arising from, related to and/or
issued pursuant to the Rights Agreement dated January 18, 1989 between PREMIER
and Premier Bank, N.A., except for shares of PREMIER common stock and rights
related thereto subject to the rights of a dissenting shareholder, if any, shall
be converted into shares of BANC ONE common stock at an Exchange Rate, of
0.617761 shares of BANC ONE common stock for each share of PREMIER common stock.
The conversion ratio of 0.617761 shares is subject to the anti-dilution
provisions of Section 7(e) of the Agreement and Plan of Merger and the
provisions set forth in Section 7(c) of the Agreement and Plan of Merger with
respect to fractional shares. At the EFFECTIVE TIME, PREMIER's shareholders
shall be allocated and entitled to receive shares of BANC ONE common stock in
exchange for the surrender and cancellation of their PREMIER common stock.
The term "Valuation Period" is defined in Section 7(c) of the Agreement and Plan
of Merger as "the ten consecutive NYSE trading days ending on the eighth NYSE
trading day immediately prior to the closing date."
The term, "BANC ONE Average Price" is defined in Section 7(c) of the Agreement
and Plan of Merger as "the average of the closing prices of BANC ONE Common on
the New York Stock Exchange ("NYSE") during the Valuation Period as reported in
The Wall Street Journal for NYSE Composite Transactions."
- -----------------------
The 500 shares of PAC common stock issued and outstanding immediately prior to
the EFFECTIVE TIME shall continue to be issued and outstanding shares of common
stock, without par value, of the Surviving Corporation.
<PAGE>
BANC ONE CORPORATION
Page 4
October 5, 1995
The anti-dilution provision of Section 7 of the Agreement and Plan of Merger
provides:
(e) If prior to the Effective Time (i) PREMIER or (ii) BANC ONE shall
declare a stock dividend or subdivide, split up, reclassify or combine
its shares of common stock or declare a dividend or make a distribution
on its common stock in any security convertible into its common stock,
appropriate adjustment or adjustments will be made in the Exchange Rate
and other factors used to determine or limit the Exchange Rate.
PREMIER's shareholders with fractional shares, at the EFFECTIVE TIME, shall not
be entitled to receive BANC ONE common stock for such fractional shares.
Instead, any holder of fractional shares of PREMIER common stock shall, upon
surrender of the certificate or certificates representing such PREMIER common
stock, be paid cash by BANC ONE on the basis of the BANC ONE Average Price, as
defined in Section 7(c) of the Agreement and Plan of Merger.
C. Additional Representations
In addition to the foregoing, the following pertinent representations have been
made by the parties to the proposed transaction:
1. The fair market value of BANC ONE common stock and other consideration
received by each PREMIER shareholder will be approximately equal to the fair
market value of the PREMIER common stock surrendered in the exchange.
2. There is no plan or intention by the shareholders of PREMIER who own 5
percent or more of the PREMIER common stock, and to the best of the
knowledge of the management of PREMIER, there is no plan or intention on the
part of the remaining shareholders of PREMIER to sell, exchange or otherwise
dispose of a number of shares of BANC ONE stock received in the transaction
that would reduce the PREMIER shareholders' ownership of BANC ONE stock to a
number of shares having a value, as of the date of the transaction, of less
than 50 percent of the value of all of the formerly outstanding stock of
PREMIER as of the same date. For purposes of this representation, shares of
PREMIER common stock exchanged for cash or other property, surrendered by
dissenters or exchanged for cash in lieu of fractional shares of BANC ONE
stock will be treated as outstanding PREMIER common stock on the date of the
transaction. Moreover, shares of PREMIER stock and shares of BANC ONE stock
held by PREMIER shareholders and otherwise sold, redeemed, or disposed of
prior or subsequent to the transaction will be considered in making this
representation.
<PAGE>
BANC ONE CORPORATION
Page 5
October 5, 1995
3. PAC will acquire at least 90 percent of the fair market value of the net
assets and at least 70 percent of the fair market value of the gross assets
held by PREMIER immediately prior to the transaction. For purposes of this
representation, amounts paid by PREMIER to dissenters, amounts paid by
PREMIER to shareholders who receive cash or other property, PREMIER assets
used to pay its reorganization expenses, and all redemptions and
distributions (except for regular, normal dividends) made by PREMIER
immediately preceding the transfer, will be included as assets of PREMIER
held immediately prior to the transaction.
4. Prior to the transaction, BANC ONE will be in control of PAC within the
meaning of (S) 368(c) of the Internal Revenue Code.
5. Following the transaction, PAC will not issue additional shares of its stock
that would result in BANC ONE's losing control of PAC within the meaning of
(S) 368(c) of the Internal Revenue Code.
6. BANC ONE has no plan or intention to reacquire any of its stock issued in
the transaction.
7. BANC ONE has no plan or intention to liquidate PAC; to merge PAC with and
into another corporation; to sell or otherwise dispose of the stock of PAC;
or to cause PAC to sell or otherwise dispose of any of the assets of PREMIER
acquired in the transaction, except for dispositions made in the ordinary
course of business or transfers described in (S) 368(a)(2)(C) of the
Internal Revenue Code.
8. The liabilities of PREMIER assumed by PAC and the liabilities to which the
transferred assets of PREMIER are subject were incurred by PREMIER in the
ordinary course of its business.
9. Following the transaction, PAC will continue the historic business of
PREMIER or use a significant portion of PREMIER's business assets in a
business.
10. BANC ONE, PAC, PREMIER, and the shareholders of PREMIER will pay their
respective expenses, if any, incurred in connection with the transaction.
11. There is no intercorporate indebtedness existing between BANC ONE and
PREMIER or between PAC and PREMIER that was issued, acquired, or will be
settled at a discount.
12. No two parties to the transaction are investment companies as defined in
(S) 368(a)(2)(F)(iii) and (iv) of the Internal Revenue Code.
<PAGE>
BANC ONE CORPORATION
Page 6
October 5, 1995
13. PREMIER is not under the jurisdiction of a court in a Title 11 or similar
case within the meaning of (S) 368(a)(3)(A) of the Internal Revenue
Code.
14. The fair market value of the assets of PREMIER transferred to PAC will
equal or exceed the sum of the liabilities assumed by PAC, plus the amount
of liabilities, if any, to which the transferred assets are subject.
15. No stock of PAC will be issued in the transaction.
The facts, assumptions, and representations set forth above have been reviewed
by the management of PREMIER, PAC, and BANC ONE. These facts, assumptions, and
representations are a material basis for the opinions contained herein. We have
been instructed to rely on them in preparing this opinion letter. We have not
independently investigated the validity of the facts, assumptions, or
representations set forth above.
ISSUES
- ------
I. Whether the statutory Merger of PREMIER with and into PAC will constitute a
reorganization within the meaning of (S)(S) 368(a)(1)(A) and
368(a)(2)(D) of the Code.
II. Whether gain or loss will be recognized by BANC ONE, PAC, or PREMIER as a
consequence of the Merger.
III. Whether gain or loss will be recognized by the shareholders of PREMIER on
the exchange of their shares of PREMIER common stock for shares of BANC ONE
common stock (disregarding for this purpose any cash received pursuant to
the exercise of statutory dissenters' rights or in lieu of fractional share
interests).
IV. Whether the Federal income tax basis of the BANC ONE common stock received
by the shareholders of PREMIER will be the same as the Federal income tax
basis of the PREMIER common stock surrendered in exchange therefor (reduced
by any amount allocated to fractional share interests for which cash is
received).
V. Whether the holding period of the BANC ONE common stock received by the
shareholders of PREMIER will include the period for which the PREMIER
common stock exchanged therefor was held, provided the exchanged PREMIER
common stock was held as a capital asset by such shareholders on the date
of the exchange.
<PAGE>
BANC ONE CORPORATION
Page 7
October 5, 1995
VI. Whether the cash received by PREMIER shareholders in exchange for their
PREMIER common stock pursuant to the exercise of their dissenters' rights
will be treated as having been received in redemption of their PREMIER
common stock and subject to the provisions of (S) 302 of the Code.
VII. Whether the payment of cash in lieu of fractional share interests of BANC
ONE common stock will be treated as if the fractional shares were
distributed as part of the exchange and then redeemed by BANC ONE, the
redemption being subject to the provisions of (S) 302 of the Code.
CONCLUSIONS
- -----------
For Federal income tax purposes, the following conclusions with respect to the
above issues are made:
I. TAX-FREE REORGANIZATION STATUS
------------------------------
The statutory Merger of PREMIER with and into PAC, as described above, will
constitute a reorganization within the meaning of (S)(S) 368(a)(1)(A) and
368(a)(2)(D) of the Code. In addition to qualifying as a statutory merger, the
Merger satisfies the requirements of (S) 368(a)(1)(A), namely (1) Continuity of
business enterprise; (2) Continuity of interest; (3) Bona fide business purpose;
and (4) Lack of overall plan of tax avoidance. In addition, the Merger meets the
additional requirement of (S) 368(a)(2)(D) that no stock of the acquiring
corporation be used to effect the transaction and that substantially all of the
assets of PREMIER will be acquired by PAC. Furthermore, BANC ONE, PAC, and
PREMIER will qualify as "parties to the reorganization" under (S) 368(b).
II. GAIN OR LOSS RECOGNITION BY BANC ONE, PAC, AND PREMIER
------------------------------------------------------
PREMIER will recognize no gain or loss upon the Merger with and into PAC, (S)
361(a); nor will BANC ONE and PAC recognize gain or loss upon the acquisition by
PAC of PREMIER's assets. Rev. Rul. 57-278, 1957-1 C.B. 124.
III. GAIN OR LOSS RECOGNITION BY SHAREHOLDERS OF PREMIER
---------------------------------------------------
Disregarding for this purpose any cash received pursuant to the exercise of
statutory dissenters' rights or for fractional share interests to which they may
be entitled, no gain or loss will be recognized to the shareholders of PREMIER
upon receipt of BANC ONE common stock. (S) 354(a)(1).
<PAGE>
BANC ONE CORPORATION
Page 8
October 5, 1995
IV. FEDERAL INCOME TAX BASIS FOR SHAREHOLDERS OF PREMIER
----------------------------------------------------
The Federal income tax basis of BANC ONE common stock to be received by the
shareholders of PREMIER will be the same as the basis of the PREMIER common
stock surrendered in exchange thereof (reduced by any amount allocated to
fractional share interests for which cash is received). (S) 358(a)(1).
V. FEDERAL INCOME TAX HOLDING PERIOD OF BANC ONE COMMON STOCK
----------------------------------------------------------
Provided that the PREMIER common stock was held as a capital asset on the date
of the exchange, the holding period of BANC ONE common stock received by the
shareholders of PREMIER will include the period during which the shareholders
held the PREMIER common stock surrendered in exchange therefor. (S) 1223(1).
VI. REDEMPTION TREATMENT FOR CASH RECEIVED PURSUANT TO THE EXERCISE OF
------------------------------------------------------------------
DISSENTERS' RIGHTS BY PREMIER SHAREHOLDERS
------------------------------------------
The shareholders who exercise their dissenters' rights will be treated as having
received the cash as a distribution in redemption of their PREMIER stock subject
to the provisions and limitations of (S) 302. Rev. Rul. 74-515, 1974-2 C.B. 118.
VII. REDEMPTION TREATMENT FOR CASH RECEIVED IN LIEU OF FRACTIONAL SHARE
------------------------------------------------------------------
INTERESTS
---------
The payment of cash in lieu of fractional share interests will be treated as if
the fractional share interests were distributed as part of the exchange and then
redeemed by BANC ONE. The payments will be treated as having been received as a
distribution in full payment in exchange for the stock redeemed as provided in
(S) 302(a). Rev. Rul. 66-365, 1966-2 C.B. 116; Rev. Proc. 77-41, 1977-2 C.B.
574.
DISCUSSION
I. TAX-FREE REORGANIZATION STATUS
------------------------------
A. Statement of Law
Tax-free reorganizations are governed by (S) 368 of the Code. The purpose of the
reorganization provisions of the Code is to exempt from taxation specifically
described exchanges incident to readjustments of corporate structures that are
required by business exigencies and effect only a readjustment of continuing
interests in property under a modified corporate form. Treas. Reg.
<PAGE>
BANC ONE CORPORATION
Page 9
October 5, 1995
(S)1.368-1(b). Requisite to a reorganization under the Code are:
1. Continuity of business enterprise, which requires that the acquiring
corporation either (a) continue the acquired corporation's historic
business, or (b) use a significant portion of the acquired
corporation's historic business assets in a business. Treas. Reg.
(S) 1.368-1(d)(2);
2. Continuity of interest by the persons who were the owners prior to
the reorganization. This requires that the target shareholders
acquire a definite and substantial proprietary interest in the
acquiring corporation. See Treas. Reg. (S) 1.368-1(b). The Internal
Revenue Service's advance ruling guidelines provide that this
requirement will be met if the former target shareholders receive
stock or equity equal in value to 50% of the value of the formerly
outstanding target stock. Rev. Proc. 77-37, 1977-2 C.B. 568.
3. A bona fide business purpose. Treas. Reg. (S)(S) 1.368-1(b), (c),
-2(g); See Gregory v. Helvering, 293 U.S. 465 (1935).
4. A lack of overall plan of tax avoidance wherein such overall plan
uses a corporate reorganization to disguise the real character of
the transaction.
In order for the transaction to qualify under (S) 368(a)(1)(A) by reason of the
application of (S) 368(a)(2)(D), one corporation (the acquiring corporation)
must acquire substantially all of the properties of another corporation (the
acquired corporation), in a statutory merger, partly or entirely in exchange for
stock of a corporation which is in control of the acquiring corporation (the
controlling corporation), provided that (i) the transaction would have qualified
under (S) 368(a)(1)(A) if the merger had been into the controlling corporation,
and (ii) no stock of the acquiring corporation is used in the transaction.
The foregoing test of whether the transaction would have qualified under (S)
368(a)(1)(A) if the merger had been into the controlling corporation means that
the general requirements of a reorganization under (S) 368(a)(1)(A) (such as a
business purpose, continuity of business enterprise, and continuity of interest)
must be met in addition to the special requirements of (S) 368(a)(2)(D).
Although no stock of the acquiring corporation can be used in the transaction,
there is no prohibition (other than the continuity of interest requirement)
against using other property, such as cash or securities, of either the
acquiring corporation or the parent or both.
Section 368(b) of the Code states that the term "a party to the reorganization"
includes both corporations in the case of a reorganization resulting from the
acquisition by one corporation of stock
<PAGE>
BANC ONE CORPORATION
Page 10
October 5, 1995
or properties of another. Under (S) 368(b), "a party to a reorganization"
includes the controlling corporation in cases where the stock of the corporation
controlling the acquiring corporation is exchanged for the properties of the
target corporation.
For purposes of (S) 368, "control" is defined as "the ownership of stock
possessing at least eighty percent (80%) of the total combined voting power of
all classes of stock entitled to vote and at least eighty percent (80%) of the
total number of shares of all other classes of stock of the corporation." (S)
368(c).
B. Application of Law
The present transaction meets all of the requirements for a reorganization under
the Code. First, the Merger of PREMIER with and into PAC will constitute a
statutory merger under applicable corporate law.
Second, PAC will continue the historic business of PREMIER or use a significant
portion of PREMIER's historic business assets in a business. Thus, the
transaction meets the continuity of business enterprise requirement.
Third, the parties have represented that there is no plan or intention by the
shareholders of PREMIER to sell, exchange, or otherwise dispose of a number of
shares of BANC ONE common stock received in the transaction that would reduce
their ownership of BANC ONE common stock to a number of shares having a value,
immediately prior to the EFFECTIVE TIME, of less than 50 percent of the total
fair market value of PREMIER stock outstanding as of the same date. Thus, the
transaction meets the continuity of interest requirement.
Fourth, this transaction will strengthen PAC's ability to meet its customers'
needs for a broader range of banking services and compete more effectively with
similar banks in PREMIER's current geographical area. It will also enable BANC
ONE to expand its existing customer base while keeping its costs constant due to
the economies of scale to be achieved as a result of the transaction. Thus, a
bona fide business purpose exists for this transaction.
Fifth, there appears to be no overall plan of tax avoidance wherein a corporate
reorganization is being used to disguise the real character of the transaction.
This requirement is satisfied because the transaction does not appear to be one
of a series of planned transactions which would, if collapsed into a single
transaction, in substance be a taxable transaction.
Finally, in addition to the general requirements of a reorganization under
(S) 368(a)(1)(A), the Merger meets the special requirements of (S) 368(a)(2)(D)
inasmuch as no stock of the acquiring corporation (PAC) is used in the
transaction and substantially all of PREMIER's assets are acquired by PAC.
<PAGE>
BANC ONE CORPORATION
Page 11
October 5, 1995
In conclusion, the statutory Merger of PREMIER with and into PAC in exchange for
shares of BANC ONE common stock satisfies the requirements for a reorganization
within the meaning of (S)(S) 368(a)(1)(A) and 368(a)(2)(D) of the Code.
Furthermore, BANC ONE, PAC, and PREMIER will each qualify as a "party to the
reorganization" as defined in (S) 368(b) of the Code.
II. GAIN OR LOSS RECOGNITION BY BANC ONE, PAC, AND PREMIER
------------------------------------------------------
A. Statement of Law
Section 361(a) of the Code provides that "[n]o gain or loss shall be recognized
to a corporation if such corporation is a party to a reorganization and
exchanges property, in pursuance of the plan of reorganization, solely for stock
or securities in another corporation a party to the reorganization."
Section 357(a) provides that if the taxpayer receives property that would be
permitted to be received under (S) 361 without recognition of gain and, in
addition, another party to the exchange assumes a liability of the taxpayer or
acquires property subject to a liability, then such assumption or acquisition is
not treated as "money or other property" and should not prevent the exchange
from falling within the non-recognition provisions of (S) 361(a).
Revenue Ruling 57-278, 1957-1 C.B. 124, concluded that no gain or loss is
recognized to a controlling corporation or its subsidiary upon the acquisition
by the subsidiary of substantially all of the target corporation's assets in
exchange for the stock of the controlling corporation.
Section 1032(a) of the Code provides that "[n]o gain or loss shall be recognized
to a corporation on the receipt of money or other property in exchange for stock
of such corporation."
B. Application of Law
PREMIER is a "party to the reorganization" as defined in Code (S) 368(b). Thus,
under (S) 361(a), PREMIER recognizes no gain or loss upon the Merger with and
into PAC solely in exchange for BANC ONE common stock. In addition, under (S)
357(a), the assumption by PAC of the liabilities of PREMIER will not be treated
as "money or other property" and will not prevent the exchange from falling
within the non-recognition provision of (S) 361(a).
Neither BANC ONE nor PAC will recognize gain or loss upon the Merger of PREMIER
with and into PAC in exchange for shares of BANC ONE common stock and the
assumption by BANC ONE of PREMIER's liabilities. Code (S) 1032, and Rev. Rul.
57-278, 1957-1 C.B. 124. BANC ONE will not recognize any gain or loss upon the
exchange of its common shares for the assets and liabilities of PREMIER. Code
(S) 1032(a).
<PAGE>
BANC ONE CORPORATION
Page 12
October 5, 1995
III. GAIN OR LOSS RECOGNITION BY SHAREHOLDERS OF PREMIER
---------------------------------------------------
A. Statement of Law
Section 354(a)(1) of the Code provides that "[n]o gain or loss shall be
recognized if stock . . . in a corporation a party to a reorganization [is] . .
. exchanged solely for stock or securities in such corporation or in another
corporation a party to the reorganization."
B. Application of Law
Disregarding any cash received pursuant to the exercise of statutory dissenters'
rights or fractional share interests, the shareholders of PREMIER will receive
BANC ONE common stock solely in exchange for cancellation of their PREMIER
common stock. Therefore, the exchange will be solely for stock in another
corporation which is a party to the reorganization. As a result, no gain or loss
will be recognized by the shareholders of PREMIER upon the Merger, ignoring the
statutory dissenters' rights or fractional share interests.
IV. FEDERAL INCOME TAX BASIS FOR SHAREHOLDERS OF PREMIER
----------------------------------------------------
A. Statement of Law
In general, (S) 358(a)(1) provides that in the case of an exchange to which (S)
354 applies, "[t]he basis of the property permitted to be received under such
section without the recognition of gain or loss shall be the same as that of the
property exchanged."
B. Application of Law
Under (S) 358(a)(1), the aggregate basis of BANC ONE common stock to be received
by the shareholders of PREMIER will be the same aggregate Federal income tax
basis as the PREMIER common stock surrendered in the exchange therefor (reduced
by any amount allocated to fractional share interests for which cash is
received).
V. FEDERAL INCOME TAX HOLDING PERIOD OF BANC ONE COMMON STOCK
----------------------------------------------------------
A. Statement of Law
Section 1223(1) of the Code provides:
In determining the period for which the taxpayer has held property
received in an exchange, there shall be included the period for which he
held the property exchanged
<PAGE>
BANC ONE CORPORATION
Page 13
October 5, 1995
if, under this chapter, the property has, for the purpose of determining
gain or loss from a sale or exchange, the same basis in whole or in part
in his hands as the property exchanged, and, in the case of such
exchanges after March 1, 1954, the property exchanged at the time of
such exchange was a capital asset as defined in section 1221 or property
described in section 1231.
B. Application of Law
The holding period of BANC ONE common stock to be received by the shareholders
of PREMIER will include the period during which they held the shares of PREMIER
common stock surrendered in the exchange therefor, provided that PREMIER common
stock was held as a capital asset on the date of the exchange. Code (S) 1223(1).
VI. REDEMPTION TREATMENT FOR CASH RECEIVED PURSUANT TO THE
------------------------------------------------------
EXERCISE OF DISSENTERS' RIGHTS BY PREMIER SHAREHOLDERS
------------------------------------------------------
A. Statement of Law
Section 302(a) of the Code provides:
If a corporation redeems its stock (within the meaning of section
317(b)), and if paragraph (1), (2), (3), or (4) of subsection (b)
applies, such redemption shall be treated as a distribution in part or
full payment in exchange for the stock.
Section 302(b)(3) provides:
Subsection (a) shall apply if the redemption is a complete redemption of
all of the stock of the corporation owned by the shareholder.
Section 317(b) of the Code provides:
For purposes of this part, stock shall be treated as redeemed by a
corporation if the corporation acquires its stock from a shareholder in
exchange for property, whether or not the stock so acquired is canceled,
retired, or held as treasury stock.
B. Application of Law
The shareholders who exercise their dissenters' rights will be treated as having
received the cash as a distribution in redemption of their PREMIER common stock
subject to the provisions and limitations of (S) 302 of the Code because they
will have a complete termination of their interest in PREMIER. See Rev. Rul. 74-
515, 1974-2 C.B. 118.
<PAGE>
BANC ONE CORPORATION
Page 14
October 5, 1995
VII. REDEMPTION TREATMENT FOR CASH RECEIVED IN LIEU OF FRACTIONAL SHARE
------------------------------------------------------------------
INTERESTS
---------
A. Statement of Law
In Rev. Rul. 66-365, 1966-2 C.B. 116, the Internal Revenue Service concluded
that where cash payments are made to the shareholders of the target corporation
in lieu of fractional share interests, those cash payments are treated as
distributions followed by redemptions under (S) 302 of the Code. The Internal
Revenue Service's advance ruling guidelines provide that:
cash to be distributed to shareholders in lieu of fractional share
interests arising in corporate reorganizations, stock splits, stock
dividends, conversion of convertible stocks, and other similar
transactions will be treated as having been received in part or full
payment in exchange for the stock redeemed if the cash distribution is
undertaken solely for the purpose of saving the corporation the expense
and inconvenience of issuing and transferring fractional shares, and is
not separately bargained-for consideration.
Rev. Proc. 77-41, 1977-2 C.B. 574.
Thus, if the redemption is not essentially equivalent to a dividend, each
shareholder's redemption will be treated as a distribution in full payment in
exchange for the shareholder's fractional share interest under (S) 302(a) of the
Code. Rev. Proc. 77-41, 1977-2 C.B. 574.
B. Application of Law
In this case, the payment of cash in lieu of issuing fractional shares is solely
for the purpose of avoiding the expense and inconvenience to BANC ONE of issuing
fractional share interests and does not represent separately bargained-for
consideration. These payments of cash will be treated as if the fractional share
interests were distributed as part of the exchange and then redeemed by BANC
ONE. The payments will be treated as having been received as a distribution in
full payment in exchange for the stock redeemed as provided in (S) 302(a) of the
Code, to the extent such payments are not essentially equivalent to a dividend.
<PAGE>
BANC ONE CORPORATION
Page 15
October 5, 1995
OPINION
- -------
Based upon the foregoing and taking into consideration the statements contained
in the section marked "CAVEAT" below, it is our opinion that the transaction
will produce the following Federal income tax consequences:
1. The transaction will be characterized as a statutory Merger of
PREMIER with and into PAC solely in exchange for BANC ONE common
stock and the assumption of all of the assets and liabilities of
PREMIER by BANC ONE.
2. A tax-free reorganization will take place under (S)(S) 368(a)(1)(A)
and 368(a)(2)(D) of the Code.
3. Except with respect to any cash payments received pursuant to the
exercise of statutory dissenters' rights or for fractional share
interests, no gain or loss will be recognized by BANC ONE, PAC, or
PREMIER, or the shareholders of PREMIER.
4. The Federal income tax basis of the BANC ONE common stock (including
fractional share interests to which the shareholders of PREMIER may
be entitled) received by the shareholders of PREMIER will be the
same as the Federal income tax basis of the PREMIER common stock
surrendered in exchange therefor.
5. The holding period of the shares of BANC ONE common stock received
by a shareholder of PREMIER will include the period for which the
PREMIER common exchanged therefor was held, provided that the
PREMIER common stock was held as a capital asset on the date of the
exchange.
6. The shareholders who exercise their dissenters' rights will be
treated as having received the cash as a distribution in redemption
of their PREMIER common stock subject to the provisions and
limitations of (S) 302 of the Code.
7. The payments of cash in lieu of fractional share interests will be
treated as if the fractional shares were distributed as part of the
exchange and then redeemed by BANC ONE, with the redemption being
entitled to treatment as a distribution in full payment in exchange
for the stock redeemed as provided in (S) 302(a) of the Code, to the
extent such payments are not essentially equivalent to a dividend.
<PAGE>
BANC ONE CORPORATION
Page 16
October 5, 1995
CAVEAT
- ------
The foregoing opinion is directed solely towards those items set forth in the
section of this opinion labeled "ISSUES;" therefore, no opinion is hereby
expressed regarding any other Federal, state, local, or other tax issues or on
any other matter not specifically mentioned therein. If any of the statements of
facts, assumptions, or representations contained herein are subsequently
determined to be incorrect in whole or in part such that they would have a
material effect upon the tax treatment of the issues addressed herein, then no
opinion is expressed as to the tax treatment of the proposed transaction.
We hereby consent to the use and filing of this opinion as an exhibit to the
registration statement filed on Form S-4 and to the reference to this opinion
under the headings "Summary--Federal Income Tax Consequences" and "Merger--
Federal Income Tax Consequences" in the prospectus filed as part of the
registration statement on Form S-4.
Very truly yours,
/s/ Coopers & Lybrand LLP
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the Registration Statement of
BANC ONE CORPORATION on Form S-4 of our report, which includes an explanatory
paragraph regarding the change in method of accounting for certain investment
securities in 1994 and the change in method of accounting for income taxes and
post-retirement benefits other than pensions in 1993, dated February 21, 1995,
on our audits of the consolidated financial statements of BANC ONE CORPORATION
as of December 31, 1994 and 1993, and for the years ended December 31, 1994,
1993 and 1992, included in BANC ONE CORPORATION's Annual Report on Form 10-K for
the year ended December 31, 1994, as amended. We also consent to the reference
to our firm under the caption "MISCELLANEOUS INFORMATION--Experts" in said
Registration Statement.
COOPERS & LYBRAND L.L.P.
Columbus, Ohio
October 5, 1995.
<PAGE>
EXHIBIT 23.3
The Board of Directors
Banc One Corporation
We consent to incorporation by reference in the Registration Statement on
Form S-4 of Banc One Corporation of our report dated January 30, 1995, relating
to the consolidated balance sheets of Premier Bancorp, Inc. as of December 31,
1994 and 1993, and the related consolidated statements of income, stockholders'
equity and cash flows for each of the years in the three-year period ended
December 31, 1994, which report appears in the December 31, 1994 annual report
on Form 10-K of Premier Bancorp, Inc. Our report refers to changes in Premier's
method of accounting for securities and income taxes.
We also consent to the reference to our firm under the caption "Experts" in
said Registration Statement.
/s/ KPMG Peat Marwick LLP
Baton Rouge, Louisiana
October 5, 1995
<PAGE>
EXHIBIT 23.5
Investment Banking Group
World Financial Center
North Tower
New York, New York 10281-1325
212 449 1000
[LOGO of Merrill Lynch, Pierce, Fenner & Smith Incorporated]
Consent
-------
We hereby consent to the use of our opinion letter dated October 13, 1995
to the Board of Directors of Premier Bancorp, Inc. included as an Annex
to the Premier Bancorp, Inc. Proxy Statement which forms a part of the Banc
One Corporation Registration Statement on Form S-4 relating to the proposed
merger of Premier, Bancorp, Inc., with and into a wholly owned subsidiary
of Banc One Corporation and to the references to such opinion and to our
firm in such Proxy Statement. In giving such consent, we do not admit and
we hereby disclaim that we come within the category of persons whose consent
is required under Section 7 of the Securities Act of 1933, as amended, or
the rules and regulations of the Securities and Exchange Commission thereunder,
nor do we thereby admit that we are experts with respect to any part of
such Registration Statement within the meaning of the term "experts" as
used in the Securities Act of 1933, as amended, or the rules and regulations
of the Securities and Exchange Commission thereunder.
MERRILL LYNCH, PIERCE, FENNER &
SMITH INCORPORATED
By /s/ Richard N. Doyle
Richard N. Doyle
Director-Investment Banking
October 4, 1995
<PAGE>
EXHIBIT 99.1
[front of proxy card]
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
P R O X Y
The undersigned hereby constitutes and appoints M. Stewart Dougherty, Jr.
and Robert S. Greer, or either of them, proxies for the undersigned, with full
power of substitution, to represent the undersigned and to vote all of the
shares of common stock of Premier Bancorp, Inc. ("PREMIER") that the undersigned
is entitled to vote at the special meeting of shareholders of PREMIER to be held
on November 17, 1995 and at any and all adjournments thereof.
1. A proposal to approve an Agreement and Plan of Merger between PREMIER, BANC
ONE CORPORATION ("BANC ONE") and PREMIER ACQUISITION CORPORATION, a wholly
owned subsidiary of BANC ONE ("PAC"), pursuant to which PREMIER will merge
with and into PAC and each outstanding share of PREMIER common stock
(together with any and all PREMIER common stock purchase rights issued under
the PREMIER rights plan) will be converted into 0.617761 share of BANC ONE
Common Stock.
FOR ____ AGAINST ____ ABSTAIN ____
2. Such other business as may properly come before the meeting or any
adjournment thereof.
<PAGE>
[reverse of proxy card]
This proxy will be voted as specified. IF NO SPECIFIC DIRECTIONS ARE GIVEN,
THIS PROXY WILL BE VOTED FOR PROPOSAL NO. 1 AND IN THE BEST JUDGMENT OF THE
PROXY HOLDERS ON ANY OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING OR
ANY ADJOURNMENT THEREOF.
_____________________________
Signature
_____________________________
Signature (if held jointly)
_____________________________
NAME: PLEASE PRINT
DATE:_______________________
Please sign exactly as name appears hereon. When signing as executor,
administrator, attorney, trustee, guardian, etc., give full title as such. For
joint accounts, each joint owner must sign.
