SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): September 15, 1997
Star Banc Corporation
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(Exact name of registrant as specified in its charter)
Ohio 0-7601 31-0838189
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification
incorporation) Number)
425 Walnut Street, Cincinnati, Ohio 45202
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(Address of principal executive offices)
(513) 632-4000
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(Registrant's telephone number, including area code)
This document contains 5 pages.<PAGE>
ITEM 5. OTHER EVENTS
On September 15, 1997, Star Banc Corporation, an Ohio cor-
poration ("Star"), issued a press release announcing the sign-
ing of a definitive agreement providing for the merger of Great
Financial Corporation, a Delaware corporation ("Great Finan-
cial"), with and into Star. A copy of the press release is
attached as Exhibit 99.1.
On September 15, 1997, Star entered into an Agreement and
Plan of Merger (the "Merger Agreement") with Great Financial
pursuant to which Great Financial will merge with and into Star
(the "Merger"). In accordance with the terms of the Merger
Agreement, each share of Great Financial common stock, par
value $.01 per share ("Great Financial Common Stock"), out-
standing immediately prior to the effective time of the Merger
(the "Effective Time") will be converted into the right to re-
ceive, at the election of the holder thereof, either (i) 0.929
of a share of Star common stock, par value $5.00 per share
("Star Common Stock"), and the associated preferred share pur-
chase rights under Star's Rights Agreement, dated October 27,
1989, or (ii) $44.00 in cash, provided that the aggregate num-
ber of shares of Great Financial Common Stock that shall be
converted in the Merger into the right to receive Star Common
Stock shall equal seventy percent of the issued and outstanding
shares of Great Financial Common Stock immediately prior to the
Effective Time.
The Merger is intended to constitute a tax-free reorgani-
zation under the Internal Revenue Code of 1986, as amended, and
to be accounted for as a purchase.
Consummation of the Merger is subject to various condi-
tions, including: (i) receipt of approval by the shareholders
of Great Financial of appropriate matters relating to the
Merger Agreement and the Merger; (ii) receipt of requisite
regulatory approvals from the Board of Governors of the Federal
Reserve System and other federal and state regulatory authori-
ties as necessary; (iii) receipt by each of Great Financial and
Star of an opinion of counsel in reasonably satisfactory form
as to the tax treatment of certain aspects of the Merger; (iv)
registration of the shares of Star Common Stock to be issued in
the Merger under the Securities Act of 1933, as amended (the
"1933 Act") and all applicable state securities laws; and (v)
satisfaction of certain other conditions.
The Merger Agreement and the transactions contemplated
thereby will be submitted for approval at a meeting of the
shareholders of Great Financial. Prior to such meeting, Star<PAGE>
will file a registration statement with the Securities and Ex-
change Commission registering under the Securities Act of 1933,
as amended, the Star Common Stock to be issued in the Merger.
Such shares of Star Common Stock will be offered to Great Fi-
nancial shareholders pursuant to a prospectus that will also
serve as a proxy statement for the shareholders' meeting.
In connection with the Merger Agreement, Star and Great
Financial entered into a Stock Option Agreement, dated Septem-
ber 23, 1997 (the "Stock Option Agreement"), pursuant to which
Great Financial granted to Star an irrevocable option to pur-
chase, under certain circumstances, up to 2,747,083 authorized
and unissued shares of Great Financial Common Stock, subject to
certain adjustments, at a price of $36.00 per share (the "Star
Option"), subject to certain adjustments. The Star Option, if
exercised, would equal, before giving effect to the exercise of
the Star Option, 19.9% of the total number of shares of Great
Financial Common Stock outstanding. The Star Option was
granted by Great Financial as a condition and inducement to
Star's willingness to enter into the Merger Agreement. Under
certain circumstances, Great Financial may be required to re-
purchase the Star Option or the shares acquired pursuant to the
exercise of the Star Option.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL
INFORMATION AND EXHIBITS
(c) Exhibits.
The following exhibit is filed with this report:
Exhibit 99.1 Press Release dated September 15, 1997 announc-
ing the signing of a definitive merger agreement
with Great Financial Corporation.<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned hereunto duly authorized.
STAR BANC CORPORATION
Date: September 25, 1997 By: /s/ Jerry A. Grundhofer
Name: Jerry A. Grundhofer
Title: Chairman, President
& Chief Financial Officer<PAGE>
EXHIBIT INDEX
Exhibit 99.1 Press Release dated September 15, 1997 announc-
ing the signing of a definitive merger agreement
with Great Financial Corporation.
FOR IMMEDIATE RELEASE
CONTACT: Steve Dale, Star Banc Media
(513) 632-4524
Bob Freeze, Great Financial Media
(502) 562-6336
David Moffett, Star Banc Analysts
(513) 632-4008
STAR BANC CORPORATION TO ACQUIRE GREAT FINANCIAL CORPORATION
CINCINNATI, OHIO, September 15, 1997...Star Banc Corporation
(NYSE:STB) and Great Financial Corporation (NASDAQ:GTFN) today
announced they have signed a definitive merger agreement.
Under the agreement, Star Banc would acquire Great Financial
for stock and cash, according to a joint announcement by Jerry
A. Grundhofer, chairman, president and chief executive officer
of Star Banc Corporation and Paul M. Baker, chairman and chief
executive officer of Great Financial Corporation. Great
Financial, a Kentucky-based thrift holding company, has $3
billion in total assets and 45 branch locations in Kentucky and
Indiana. Star Banc Corporation is an $10.8 billion multi-state
bank holding company and operates 276 full-service banking
locations in Ohio, Kentucky and Indiana.
Based on Star Banc's closing price on September 12, 1997, of
$46 3/8 per share, the value of the transaction is approx-
imately $655 million. The terms of the agreement call for 70
percent of the outstanding Great Financial shares to be ex-
changed for common shares of Star Banc stock at an exchange
ratio of 0.949 Star Banc share for each Great Financial share.
The remaining 30 percent of Great Financial shares would be
exchanged for $44 in cash for each share.
The merger is structured as a tax-free exchange for share-
holders receiving stock, and will be accounted for as a
purchase transaction. In connection with the purchase, Star
Banc plans to repurchase a portion of the shares to be issued
in the merger in open market transactions from time to time
depending upon market conditions and other factors. Addition-
ally, Great Financial granted Star Banc an option to purchase
19.9 percent of its shares exercisable under certain condi-
tions. This acquisition is expected to be completed in the
first quarter of 1998.
Grandhofer noted, "Great Financial is an outstanding organi-
zation with an 85 year history of quality customer service.
Combining with Great Financial gives Star Banc the opportunity
to attract new customers and further extend our platform of
services into geographic regions which are natural extensions
of our existing Kentucky franchise. This transaction meets all
our acquisition strategy criteria and most importantly is<PAGE>
immediately accretive to earnings. We welcome the opportunity
to extend to Great Financial markets our commitment to giving
customers what they want, when they want it and on their own
terms."
Baker said that Great Financial has consistently provided
quality service to its customers and the combination with Star
Banc will further enhance the organization's product capa-
bilities and growth prospects for their employees and share-
holders.
Baker added, "Combining the strengths of our two organizations
will demonstrate benefits to our customers and shareholders.
Star Banc is an outstanding organization and an industry leader
in customer service and technology. The potential of these
present and future benefits make this a timely merger oppor-
tunity."
Great Financial's consumer, mortgage banking, commercial
lending and private banking presence in and around the major
Kentucky markets of Louisville, Lexington and Owensboro provide
Star Bank, N.A., Star Banc's banking subsidiary, the oppor-
tunity to offer a broader mix of consumer, commercial and trust
financial products and services in an expanded geographic
territory. Star Banc's products and services include commer-
cial banking, consumer banking, trust and investment services,
international banking, credit card services, cash management
and more.
Cincinnati-based Star Banc, founded in 1863, is located across
the Ohio River from Kentucky. Star Banc has had a major
presence in the Northern Kentucky counties of Kenton, Boone,
Campbell, Pendleton and Carroll, and in Marion County, in
Central Kentucky, for many years. The acquisition of Great
Financial would make Star Banc Kentucky's fourth largest bank.
This agreement is subject to approval by Great Financial
shareholders and federal regulatory agencies.
Star Bank, a leader in high quality customer service and
relationship banking was the first bank in the U.S. to offer a
fully integrated 24-Hour Banking System in 1995. Star's 24-
Hour Banking System includes branch banking, voice-activated
phone banking, PC banking, super ATMs, screen phone banking,
video kiosk banking and Internet banking. Star Bank Internet
Banking is now available to customers through a state-of-the-
art on-line real time system which enables customers to access
their total banking relationship, at no charge, through their
personal computer. In 1996, Star Bank was the first to offer
its Five Star Service Guarantee which assures customers of
certain key banking benefits or the customer will be paid for
that inconvenience. Star Bank's Internet address is http://
www.starbank.com.
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