SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. )*
BancFlorida Financial Corporation
(Name of Issuer)
Common Stock, $0.01 par value per share
(Title of Class of Securities)
059451-10-4
(CUSIP Number)
Marion A. Cowell, Jr.
One First Union Center
Charlotte, North Carolina 28288-0013
(704) 374-6828
(Name, Address and Telephone Number
of Person Authorized to Receive
Notices and Communications)
January 17, 1994
(Date of Event which Requires Filing
of this Statement)
If the filing person has previously filed a statement on Schedule
13G to report the acquisition which is the subject of this
Schedule 13D, and is filing this schedule because of Rule
13d-1(b)(3) or (4), check the following box [ ].
Check the following box if a fee is being paid with this
statement [X]. (A fee is not required only if the reporting
person: (1) has a previous statement on file reporting
beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment
subsequent thereto reporting beneficial ownership of five percent
or less of such class. See Rule 13d-7.)
Note: Six copies of this statement, including all exhibits,
should be filed with the Commission. See Rule 13d-1(a) for other
parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a
reporting person's initial filing on this form with respect to
the subject class of securities, and for any subsequent amendment
containing information which would alter disclosures provided in
a prior cover page.
Page 1 of 8
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The information required on the remainder of this cover page
shall not be deemed to be "filed" for the purpose of Section 18
of the Securities Exchange Act of 1934 ("Act") or otherwise
subject to the liabilities of that section of the Act but shall
be subject to all other provisions of the Act (however, see the
Notes).
CUSIP No.: 059451-10-4
1. Name of Reporting Person: First Union Corporation
S.S. or I.R.S. Identification No. of Above Person: I.R.S.
Identification No. 56-0898180
2. Check the Appropriate Box if a Member of a Group (See
Instructions):
a. [ ] b. [ ]
3. SEC Use Only
4. Source of Funds (see Instructions): WC; 00
5. Check Box if Disclosure of Legal Proceedings is Required
Pursuant to Items 2(d) or 2(e): [ ]
6. Citizenship or Place of Organization: North Carolina
Number of 7. Sole Voting Power: 719,000*
Shares Bene-
ficially 8. Shared Voting Power:
Owned by
Each Report- 9. Sole Dispositive Power: 719,000*
ing Person
With 10. Shared Dispositive Power:
11. Aggregate Amount Beneficially Owned by Each Reporting
Person:
719,000*
12. Check Box if the Aggregate Amount in Row 11 Excludes Certain
Shares (See Instructions): [ ]
Page 2 of 8
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13. Percent of Class Represented by Amount in Row 11: 19.9*
14. Type of Reporting Person (See Instructions): HC; CO
* The shares indicated are purchasable by First Union
Corporation ("FUNC") upon exercise of an option issued to
FUNC on January 17, 1994, and described in Item 4 of
this report. Prior to the exercise of the option, FUNC is
not entitled to any rights as a shareholder of BancFlorida
Financial Corporation ("BFL") as to the shares covered by the
option. The option may only be exercised upon the happening
of certain events referred to in Item 4, none of which has
occurred as of the date hereof. FUNC expressly disclaims
beneficial ownership of any of the shares of common stock of
BFL which are purchasable by FUNC upon exercise of the option.
The percentage indicated represents the percentage of the
total outstanding shares of common stock of BFL as of
January 17, 1994 (excluding shares issuable upon exercise
of the option).
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Item 1. Security and Issuer.
This statement relates to the common stock of BancFlorida
Financial Corporation ("BFL"), $0.01 par value per share ("BFL
Common Stock"). BFL is a Delaware corporation whose principal
executive offices are located at 5801 Pelican Bay Boulevard,
Naples, Florida 33963. BFL is a savings and loan holding company
under the Home Owners' Loan Act of 1933.
Item 2. Identity and Background.
This statement is being filed by First Union Corporation
("FUNC"), a North Carolina corporation whose principal executive
offices are located at One First Union Center, Charlotte, North
Carolina 28288-0013. FUNC is a bank holding company registered
under the Bank Holding Company Act of 1956, as amended.
To the best of FUNC's knowledge, during the last five years,
neither FUNC nor any of its directors or executive officers has
been convicted in any criminal proceedings (excluding traffic
violations or similar misdemeanors) nor has FUNC or any of its
directors or executive officers been a party to any civil
proceeding of a judicial or administrative body of competent
jurisdiction resulting in a judgment, decree or final order
enjoining future violations of, or prohibiting or mandating
activities subject to, federal or state securities laws or
finding any violation with respect to such laws.
Attached hereto is an appendix to Item 2 setting forth
certain additional information concerning the directors and
executive officers of FUNC.
Item 3. Source and Amount of Funds or Other Consideration.
It is presently anticipated that purchases of shares of BFL
Common Stock as described in Item 4 would be made with funds
obtained from FUNC's working capital and funds available for
investment.
Item 4. Purpose of Transaction.
Pursuant to an Agreement and Plan of Mergers (the "Merger
Agreement"), dated as of January 17, 1994, among BFL,
BancFlorida, a Federal Savings Bank, a wholly-owned subsidiary of
BFL, FUNC, First Union Corporation of Florida ("FUNC-FL") and First
Union National Bank of Florida ("FUNB-FL"), a wholly-owned
(except for directors' qualifying shares) subsidiary of FUNC, and
in consideration thereof, BFL issued to FUNC on such date an
option (the "Option") to purchase, under certain conditions, up
to 719,000 shares of BFL
Page 4 of 8
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Common Stock at a purchase price per share of $25.00 (the
"Purchase Price"), subject to adjustment pursuant to
anti-dilution provisions.
The Option was issued to FUNC pursuant to a Stock Option
Agreement, dated as of January 17, 1994, between FUNC and BFL
(the "Option Agreement"), which formed an integral part of the
Merger Agreement. The Merger Agreement provides, among other
things, for the merger of BFL into FUNC-FL (the "Merger"). Upon
consummation of the Merger, which is subject to the approval of
BFL stockholders, regulatory approvals, and the satisfaction or
waiver of various other terms and conditions, BFL stockholders
would receive 0.669 shares of FUNC common stock, $3.33 1/3 par
value per share ("FUNC Common Stock"), for each share of BFL
Common Stock and each share of BFL convertible preferred stock if
FUNC's Common Stock price is between $41.875 and $44.875 per
share. If FUNC's Common Stock price is below $41.875, BFL
stockholders would receive $28.00 of FUNC Common Stock for each
share of BFL Common Stock and each share of BFL convertible
preferred stock. If FUNC's Common Stock is above $44.875, BFL
stockholders would receive $30.00 of FUNC Common Stock for each
share of BFL Common Stock and each share of BFL convertible
preferred stock. The calculation of FUNC's Common Stock price
will be based on the average closing price of FUNC Common Stock
for the ten trading days prior to the effective date of the
Merger.
If not in material breach of the Option Agreement or the
Merger Agreement, FUNC may exercise the Option, in whole or in
part, at any time and from time to time following the happening
of certain events (each a "Purchase Event"), including:
(a) BFL taking certain actions (each an "Acquisition
Transaction"), including authorizing, recommending or
entering into an agreement with any third party to
effect (i) a merger, consolidation or similar
transaction involving BFL or any of its significant
subsidiaries, (ii) the sale, lease, exchange or other
disposition of 20% or more of the consolidated assets
of BFL and its subsidiaries, or (iii) the issuance,
sale or other disposition of 20% or more of the voting
securities of BFL or any of its significant
subsidiaries (other than as a result of the exercise of
outstanding options or the conversion of outstanding
convertible securities of BFL); or
(b) any third party acquires or has the right to acquire
15% or more of the outstanding shares of BFL Common
Stock (or if such party was the owner of 15% or more of
such shares on January 17, 1994, such party acquires 5%
or more of such shares);
Page 5 of 8
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provided, the Option will terminate upon the earliest to occur of
certain events, including:
(a) consummation of the Merger;
(b) termination of the Merger Agreement by BFL (a "BFL
Termination") prior to the happening (subject to
certain limitations) of a Purchase Event or certain
events (each a "Preliminary Purchase Event"),
including:
(i) commencement by any third party of a tender or
exchange offer to purchase 20% or more of the
outstanding shares of BFL Common Stock;
(ii) failure of the stockholders of BFL to approve the
Merger Agreement after pubic announcement that a
third party:
(x) proposes to engage in an Acquisition
Transaction;
(y) commences a tender offer to purchase 20% or
more of the outstanding shares of BFL Common
Stock; or
(z) files an application under certain federal
statutes relating to the regulation of banks
and other financial institutions or their
holding companies, to engage in an
Acquisition Transaction;
(iii) any third party proposes to BFL or its
stockholders, publicly or in any writing that
becomes publicly disclosed, to engage in an
Acquisition Transaction;
(iv) after a proposal by a third party to BFL or its
stockholders to engage in an Acquisition
Transaction, BFL breaches any covenant or
obligation in the Merger Agreement which would
entitle FUNC to terminate the Merger Agreement; or
(v) any third party, other than in connection with a
transaction which FUNC has consented to in
writing, files an application with any federal or
state bank regulatory authority for approval to
engage in an Acquisition Transaction;
(c) 18 months after termination of the Merger Agreement by
BFL other than pursuant to a BFL Termination; and
(d) 18 months after termination of the Merger Agreement by
FUNC.
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Upon the occurrence of certain events set forth in the
Option Agreement, the Option must be converted into, or exchanged
for, an option, at the election of FUNC, of another corporation
or BFL (the "Substitute Option"). The terms of any such
Substitute Option are set forth in the Option Agreement.
A copy of the form of the Merger Agreement, including the
Option Agreement, is attached hereto as Exhibit 1, and the
foregoing summary, as well as the other information contained in
this report, is qualified in its entirety by reference thereto.
Item 5. Interest in Securities of the Issuer.
The 719,000 shares of BFL Common Stock which are purchasable
by FUNC upon exercise of the Option are equal to approximately
19.9% of BFL Common Stock, based on the 3,615,370 shares of BFL
Common Stock issued and outstanding on January 17, 1994
(excluding shares issuable upon exercise of the Option).
FUNC expressly disclaims any beneficial ownership of the
719,000 shares of BFL Common Stock which are purchasable by FUNC
upon exercise of the Option because the Option is exercisable
only in the circumstances referred to in Item 4 above, none of
which has occurred as of this date. If the Option were
exercised, FUNC would have sole right to vote or to dispose of
the shares of BFL Common Stock issued as a result of such
exercise.
The Option contains anti-dilution provisions which provide
that the number of shares of BFL Common Stock issuable upon
exercise of the Option and the Purchase Price will be adjusted
upon the happening of certain events, including the payment of
a stock dividend or other distribution in BFL Common Stock
or the subdivision or reclassification of BFL Common Stock, as set
forth in the Option Agreement.
Other than as set forth in this Item 5, to the best of
FUNC's knowledge (i) neither FUNC nor any subsidiary or affiliate
of FUNC
or any of FUNC's executive officers or directors, beneficially
owns any shares of BFL Common Stock, and (ii) there have been no
transactions in the shares of BFL Common Stock effected during
the past 60 days by FUNC, nor to the best of FUNC's knowledge, by
any subsidiary or affiliate of FUNC or any of FUNC's executive
officers or directors. FUNB-FL is a trustee of a trust account
that holds 2,900 shares of BFL Common Stock. FUNB-FL has no
voting or dispositive power with respect to such shares.
No other person is known by FUNC to have the right to
receive or the power to direct the receipt of dividends from, or
the proceeds from the sale of, the BFL Common Stock obtainable by
FUNC upon exercise of the Option.
Page 7 of 8
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Item 6. Contracts, Arrangements, Understandings or Relationships
with Respect to Securities to the Issuer.
Other than the Merger Agreement, including Exhibits A and B
thereto, a copy of the form of which (excluding the Schedules and
certain Exhibits referred to in the Merger Agreement) is attached
hereto as Exhibit 1, to the best of FUNC's knowledge there are at
present no contracts, arrangements, understandings or
relationships (legal or otherwise) among the persons named in
Item 2 above and between such persons and any person with respect
to any securities of BFL. Exhibit A to the Merger Agreement
contains the form of the Option Agreement. Exhibit B to the
Merger Agreement contains the form of an agreement, dated as of
January 17, 1994, pursuant to which the holder of all of the
outstanding shares of BFL convertible preferred stock agreed,
among other things, to vote such shares in favor of approval
of the Merger Agreement at a meeting of BFL stockholders (the
"Preferred Agreement").
Item 7. Material to be Filed as Exhibits.
A copy of the form of the Merger Agreement, including the
Option Agreement and Preferred Agreement, is attached hereto as
Exhibit 1.
Signature.
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this
statement is true, complete and correct.
FIRST UNION CORPORATION
Date: January 24, 1994 /s/ Kent S. Hathaway
Senior Vice President and
Deputy General Counsel
Page 8 of 8
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Appendix to Item 2
Principal
Position with employment and
Name and residence First Union principal business
or business address* Corporation of employer
G. Alex Bernhardt Director President and Chief
Bernhardt Furniture Executive Officer,
Furniture Company Bernhardt Furniture
P.O. Box 740 Company, furniture
Lenoir, NC 28645 manufacturing
W. Waldo Bradley Director Chairman, Bradley
Bradley Plywood Corp. Plywood Corporation,
P.O. Box 1408 building materials
Savannah, GA 31402
Robert J. Brown Director Chairman, President
B&C Associates and Chief Executive
P.O. Box 2636 Officer, B&C
High Point, NC 27261 Associates, Inc., a
public relations and
marketing research
firm
Edward E. Crutchfield, Executive Chairman, President
Jr. Officer and and Chief Executive
One First Union Center Director Officer, First Union
Charlotte, NC 28288 Corporation
Warner N. Dalhouse Director Chairman, First
First Union National Union Corporation
Bank of Virginia of Virginia,
213 S. Jefferson Street a subsidiary of
Roanoke, VA 24011 First Union
Corporation
Robert D. Davis Director Chairman, DDI, Inc.,
DDI, Inc. investments
P.O. Box 2088
Jacksonville, FL 32203
R. Stuart Dickson Director Chairman, Ruddick
Ruddick Corporation Corporation, a
Two First Union Center diversified holding
Suite 2000 company
Charlotte, NC 28282
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Principal
Position with employment and
Name and residence First Union principal business
or business address* Corporation of employer
B.F. Dolan Director Retired
Textron, Inc.
Box 878
Providence, RI 02901
Roddey Dowd, Sr. Director Chairman, Charlotte
Charlotte Pipe & Pipe & Foundry
Foundry Company Company,
P.O. Box 35430 manufacturer of pipe
Charlotte, NC 28235 and fittings
William H. Goodwin, Jr. Director Chairman, CCA
CCA Industries, Inc. Industries, Inc. a
One James Center multinational
901 East Cary Street organization
Richmond, VA 23219
John R. Georgius Executive President, First
First Union Corporation Officer and Union Corporation
One First Union Center Director
Charlotte, NC 28288-0003
Brenton S. Halsey Director Chairman Emeritus,
James River Corporation James River
P.O. Box 2218 Corporation
Richmond, VA 23217
Howard H. Haworth Director President, the
Haworth Group Haworth Group,
First Union Bank Bldg. investments
300 North Green Street
Suite 201
Morganton, NC 28655
Torrence E. Hemby, Jr. Director President, Beverly
Beverly Crest Corp. Crest Corporation,
4419 Sharon Road real estate
Charlotte, NC 28211 development
Leonard G. Herring Director President and Chief
Lowe's Companies, Inc. Executive Officer,
P.O. Box 1111 Lowe's Companies,
North Wilkesboro, NC 28656 Inc., building and
related products
2
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Principal
Position with employment and
Name and residence First Union principal business
or business address* Corporation of employer
Jack Laughery Director Chairman, Hardee's
Hardee's Food Systems, Food Systems, Inc.
Inc. a fast food chain
800 Tiffany Boulevard
Suite 305
Rocky Mount, NC 27801
Max Lennon Director President, Clemson
Clemson University University
P.O. Box 992
Clemson, SC 29633-0992
Radford D. Lovett Director Chairman, Commodores
Commodores Point Terminal Point Terminal
Corporation Corporation, marine
P.O. Box 4069 terminal operator
Jacksonville, FL 32201
Henry D. Perry Director Physician
3866 Sheridan Street
Hollywood, FL 33021
Randolph N. Reynolds Director Executive Vice
Executive Vice President, President,
International Reynolds Metals
Reynolds Metals Company Company, an
P.O. Box 27002 aluminum metal
Richmond, VA 23261 manufacturer
Ruth G. Shaw Director Vice President,
Central Piedmont Duke Power Company,
Community College an investor-owned
P.O. Box 35009 electric utility
Charlotte, NC 28235
Lanty L. Smith Director Chairman and Chief
Precision Fabrics Executive Officer,
Group, Inc. Precision Fabrics
Suite 600 Group, Inc.,
One Southern Life Center textile products
Greensboro, NC 27401
Dewey L. Trogdon Director Chairman, Cone Mills
Cone Mills Corporation Corporation, textile
1201 Maple Street manufacturing
Greensboro, NC 27405
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Principal
Position with employment and
Name and residence First Union principal business
or business address* Corporation of employer
B.J. Walker Executive Officer Vice Chairman,
225 Water Street and Director First Union
Jacksonville, Fl 32202 Corporation
Kenneth G. Younger Director Chairman, Carolina
Carolina Freight Corp. Freight Corporation,
P.O. Box 545 interstate motor
Cherryville, NC 28021 carrier
Marion A. Cowell, Jr. Executive Executive Vice
One First Union Center Officer President,
Charlotte, NC 28288 Secretary and
General Counsel,
First Union
Corporation
Robert T. Atwood Executive Executive Vice
One First Union Center Officer President and
Charlotte, NC 28288 Chief Financial
Officer, First
Union Corporation
John D. Uible Director Investor
225 Water Street
Suite 840
Jacksonville, FL 32202
*All of the directors and executive officers are citizens of the
United States.
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Exhibit 1
AGREEMENT AND PLAN OF MERGERS
AGREEMENT AND PLAN OF MERGERS, dated as of the 17th day of
January, 1994 (this "Plan"), by and among BANCFLORIDA FINANCIAL
CORPORATION ("BFL"), BANCFLORIDA, A FEDERAL SAVINGS BANK (the
"Bank"), FIRST UNION CORPORATION ("First Union"), FIRST UNION
CORPORATION OF FLORIDA ("FUNC-FL") and FIRST UNION NATIONAL BANK
OF FLORIDA ("FUNB-FL").
RECITALS:
(A) BFL. BFL is a corporation duly organized and existing
in good standing under the laws of the State of Delaware, with
its principal executive offices located in Naples, Florida. BFL
is a registered savings and loan holding company under the Home
Owners' Loan Act of 1933. As of the date hereof, BFL has
16,000,000 authorized shares of common stock, each of $0.01 par
value ("BFL Common Stock"), and 2,000,000 authorized shares of
cumulative convertible preferred stock, each of $0.01 par value
("BFL Preferred Stock") (no other class of capital stock being
authorized), of which 3,615,370 shares of BFL Common Stock and
1,138,000 shares of BFL Preferred Stock, are issued and
outstanding.
(B) The Bank. The Bank is a stock federal savings bank
duly organized and existing in good standing under the laws of
the United States, with its principal executive offices located
in Naples, Florida. As of the date hereof, the Bank has
3,000,000 authorized shares of common stock, each of $0.01 par
value ("Bank Common Stock") 2,000,000 authorized shares of
preferred stock, each of $0.01 par value ("Bank Preferred
Stock")(no other class of capital stock being authorized), of
which 2,539,000 shares of Bank Common Stock and 929,720 shares of
Bank Preferred Stock are issued and outstanding. All of the
issued and outstanding Bank Common Stock and Bank Preferred Stock
are owned by BFL. As of September 30, 1993, the Bank had
capital of $88,219,138, divided into common stock of $25,930,
preferred stock of $9,297, surplus of $56,970,698 and undivided
profits, including capital reserves, of $31,202,873, net of ESOP
obligation of $294,883 and net unrealized loss on investment
securities of $431,000.
(C) First Union. First Union is a corporation duly
organized and existing in good standing under the laws of the
State of North Carolina, with its principal executive offices
located in Charlotte, North Carolina. As of the date hereof,
First Union has 750,000,000 authorized shares of common stock,
each of $3.33 1/3 par value (together with the rights ("First
Union Rights") issued pursuant to a Shareholder Protection Rights
Agreement, dated December 18, 1990 (as amended, the "First Union
Rights Agreement")) attached thereto, "First Union Common
Stock"), 40,000,000 authorized shares of Class A Preferred Stock,
<PAGE>
no-par value ("First Union Class A Preferred Stock"), and
10,000,000 authorized shares of Preferred Stock, no-par value
("First Union Preferred Stock") (no other class of capital stock
being authorized), of which 169,573,982 shares of First Union
Common Stock, no shares of First Union Class A Preferred Stock
and 6,318,350 shares of Series 1990 Cumulative Perpetual
Adjustable Rate Preferred Stock, constituting a single series of
First Union Preferred Stock, were issued and outstanding as of
September 30, 1993.
(D) FUNC-FL. FUNC-FL is a corporation duly organized and
existing in good standing under the laws of the State of Florida,
with its principal executive offices located in Jacksonville,
Florida. As of the date hereof, FUNC-FL has 7,500 authorized
shares of common stock each of $1.00 par value ("FUNC-FL Common
Stock") (no other class of capital stock being authorized), of
which two shares of FUNC-FL Common Stock are issued and
outstanding and owned by First Union.
(E) FUNB-FL. FUNB-FL is a national banking association
duly organized and existing under the laws of the United States,
with its principal executive offices located in Jacksonville,
Florida. As of the date hereof, FUNB-FL has 4,596,079 authorized
shares of common stock, each of $10.00 par value ("FUNB-FL Common
Stock") (no other class of capital stock being authorized), of
which 4,596,079 shares are issued and outstanding and owned by
FUNC-FL (other than directors' qualifying shares). As of
September 30, 1993, FUNB-FL had capital of $2,161,302,000,
divided into common stock of $45,961,000, surplus of
$1,698,872,000 and undivided profits, including capital reserves,
of $416,469,000.
(F) Stock Option Agreement; Voting Agreement. Immediately
after the execution and delivery of this Plan, as a condition and
inducement to First Union's willingness to enter into this Plan,
BFL and First Union are entering into a Stock Option Agreement
(the "Stock Option Agreement") in the form atached hereto as
Exhibit A, pursuant to which BFL is granting to First Union an
option to purchase, under certain circumstances, shares of BFL
Common Stock. As a condition and inducement to First Union's,
FUNC-FL's and FUNB-FL's willingness to enter into this Plan, the
owner of all of the issued and outstanding shares of BFL
Preferred Stock has entered into an agreement with First Union,
FUNC-FL and FUNB-FL in the form attached hereto as Exhibit B,
pursuant to which, among other things, such owner has agreed to
vote in favor of approval of the transactions contemplated by
this Plan at the Meeting (as hereinafter defined).
(G) Rights, Etc. Except as Previously Disclosed in Schedule
4.01(C), there are no shares of BFL Common Stock, BFL Preferred
Stock, Bank Common Stock or Bank Preferred Stock authorized and
reserved for issuance, neither BFL nor the Bank has any Rights
2
<PAGE>
(as defined below) issued or outstanding and neither BFL nor the
Bank has any commitment to authorize, issue or sell any such
shares or any Rights, except (i) pursuant to this Plan, (ii) the
Stock Option Agreement, or (iii) upon conversion of the BFL
Preferred Stock outstanding at the date hereof. The terms
"Rights" means securities or obligations convertible into or
exchangeable for, or giving any person any right to subscribe for
or acquire, or any options, calls or commitments relating to,
shares of capital stock. There are no preemptive rights in
respect of the BFL Common Stock or the BFL Preferred Stock.
(H) Approvals. The Board of Directors of each of BFL, the
Bank, First Union, FUNC-FL and FUNB-FL has approved, at meetings
of each of such Boards of Directors, this Plan and (in the case
of BFL and First Union) the Stock Option Agreement and has
authorized the execution hereof and thereof in counterparts.
(I) Other. It is the intention of the parties to this Plan
that the Mergers (as hereinafter defined) shall include the right
of FUNC-FL to acquire the assets and assume the liabilities of
the subsidiaries of BFL and to assign such right to any
corporation which FUNC-FL controls. Pursuant to the foregoing
and under the authority of Revenue Rulings 64-73 and 70-224,
FUNC-FL may assign its right to acquire the assets and assume
the liabilities of the subsidiaries of BFL to FUNB-FL, and may
also direct each such subsidiary to transfer all of its assets
and liabilities to FUNB-FL on the Effective Date (as hereinafter
defined), or at any time thereafter, including by means of a
statutory merger.
In consideration of their mutual promises and obligations,
the parties hereto adopt and make this Plan and prescribe the
terms and conditions thereof and the manner and basis of carrying
it into effect, which shall be as follows:
I. THE MERGERS.
1.01. The Corporate Merger. On the Effective Date:
(A) The Continuing Corporation. BFL shall merge
into FUNC-FL (the "Corporate Merger"), the separate
existence of BFL shall cease and FUNC-FL (the "Continuing
Corporation") shall survive and the name of the Continuing
Corporation shall be "First Union Corporation of Florida".
(B) Rights, Etc. The Continuing Corporation
shall thereupon and thereafter possess all of the rights,
privileges, immunities and franchises, of a public as well
as of a private nature, of each of the merging corporations;
and all property, real, personal and mixed, and all debts
due on whatever account, and all other choses in action, and
all and every other interest, of or belonging to or due to
3
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each of the corporations so merged, shall be deemed to be
vested in the Continuing Corporation without further act or
deed; and the title to any real estate or any interest
therein, vested in each of such corporations, shall not
revert or be in any way impaired by reason of the Corporate
Merger.
(C) Liabilities. The Continuing Corporation
shall thenceforth be responsible and liable for all the
liabilities, obligations and penalties of each of the
corporations so merged.
(D) Articles of Incorporation; By-laws;
Directors; Officers. The Articles of Incorporation and
By-laws of the Continuing Corporation shall be those of
FUNC-FL, as in effect immediately prior to the Corporate
Merger becoming effective. The directors and officers of
FUNC-FL in office immediately prior to the Corporate Merger
becoming effective shall be the directors and officers of
the Continuing Corporation, together with such additional
directors and officers as may thereafter be elected, who
shall hold office until such time as their successors are
elected and qualified.
1.02. The Bank Merger. Immediately following
consummation of the Corporate Merger on the Effective Date or as
soon thereafter as FUNB-FL may deem appropriate:
(A) The Continuing Bank. The Bank shall be
merged with and into FUNB-FL (the "Bank Merger" and together
with the Corporate Merger, the "Mergers"), the separate
existence of the Bank shall cease and FUNB-FL (the
"Continuing Bank") shall survive, the name of the Continuing
Bank shall be "First Union National Bank of Florida" and the
Continuing Bank shall continue to conduct the business of a
national banking association at its main office in
Jacksonville, Florida and at the legally established
branches of the Bank and FUNB-FL.
(B) Rights, Etc. The Continuing Bank shall
thereupon and thereafter possess all the rights, privileges,
immunities and franchises, of a public as well as of a
private nature, of each of the banks so merged; and all
property, real personal and mixed, and all debts due on
whatever account, and all other choses in action, and all
and every other interest, of or belonging to or due to each
of the banks so merged, shall be taken and deemed to be
transferred to and vested in the Continuing Bank without
further act or deed, including appointments, designations
and nominations and all other rights and interests in any
fiduciary capacity; and the title to any real estate or any
interest therein, vested in each of such banks, shall not
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revert or be in any way impaired by reason of the Bank
Merger.
(C) Liabilities, Etc. The Continuing Bank shall
thenceforth be responsible and liable for all the
liabilities, obligations and penalties of the banks so
merged (including liabilities arising out of the operation
of any trust departments). All rights of creditors and
obligors and all liens on the property of each of the Bank
and FUNB-FL shall be preserved unimpaired.
(D) Charter; By-Laws; Directors; Officers. The
Charter and By-Laws of the Continuing Bank shall be those of
FUNB-FL, as in effect immediately prior to the Bank Merger
becoming effective. The directors and officers of FUNB-FL
in office immediately prior to the Bank Merger becoming
effective shall be the directors and officers of the
Continuing Bank, together with such additional directors and
officers as may thereafter be elected, who shall hold office
until such time as their successors are elected and
qualified.
(E) Outstanding Stock of the Continuing Bank.
The amount of the capital stock of the Continuing Bank shall
be not less than $45,960,790 and shall consist of not less
than 4,596,079 issued and outstanding shares of common
stock, each of $10.00 par value, and the issued and
outstanding shares shall remain issued and outstanding as
shares of FUNB-FL, each of $10.00 par value, and the holders
thereof shall retain their rights therein.
(F) Outstanding Stock of the Bank. The
Continuing Corporation shall deliver all of the issued and
outstanding shares of the Bank to the Continuing Bank for
cancellation.
1.03. Effective Date. Subject to the conditions to the
obligations of the parties to effect the Mergers as set forth in
Article VI, the effective date (the "Effective Date") shall be
such date as First Union shall notify BFL in writing not less
than five days prior thereto, which date shall not be more than
30 days after such conditions have been satisfied or waived in
writing. Prior to the Effective Date, FUNC-FL and BFL shall
execute and deliver to the Secretary of State of the States of
Florida and Delaware, Articles of Merger in accordance with
applicable law.
II. CONSIDERATION.
2.01. Corporate Merger Consideration. Subject to the
provisions of this Plan, on the Effective Date:
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(A) Outstanding FUNC-FL Common Stock. The shares
of FUNC-FL Common Stock issued and outstanding immediately
prior to the Effective Date shall, on and after the
Effective Date, remain as issued and outstanding shares of
FUNC-FL Common Stock.
(B) Outstanding BFL Common Stock. Each share
(excluding shares ("Treasury Shares") held by BFL or any of
its subsidiaries or by First Union or any of its
subsidiaries, in each case other than in a fiduciary
capacity or as a result of debts previously contracted) of
BFL Common Stock issued and outstanding immediately prior to
the Effective Date shall, by virtue of the Corporate Merger,
automatically and without any action on the part of the
holder thereof, become and be converted into the right to
receive the number of shares of First Union Common Stock
equal to the Exchange Ratio (as hereinafter defined). The
Exchange Ratio shall be equal to: (i) 0.669 if the First
Union Price (as hereinafter defined) is greater than $41.874
and less than $44.876; (ii) the result obtained by dividing
$28.00 by the First Union Price if the First Union Price is
$41.874 or less; or (iii) the result obtained by dividing
$30.00 by the First Union Price if the First Union Price is
$44.876 or greater. The First Union Price shall be equal to
the average of the last reported sale prices per share of
First Union Common Stock on the New York Stock Exchange
("NYSE") Composite Transactions reporting system for the ten
trading days immediately prior to the Effective Date (as
reported in The Wall Street Journal), subject to possible
adjustment as set forth in Section 2.05, and upon any such
adjustment any references in this Plan to "Exchange Ratio"
shall thereafter be deemed to refer to the Exchange Ratio as
adjusted pursuant to such Section.
(C) Outstanding BFL Preferred Stock. Each share
of BFL Preferred Stock issued and outstanding immediately
prior to the Effective Date shall, by virtue of the
Corporate Merger, automatically and without any action on
the part of the holder thereof, become and be converted into
the right to receive a number of shares of First Union
Common Stock equal to the product of (i) the Exchange Ratio,
and (ii) the number of shares of BFL Common Stock into which
a share of BFL Preferred Stock is convertible as of the
Effective Date.
2.02. Stockholder Rights; Stock Transfers. On the
Effective Date, holders of BFL Common Stock and BFL Preferred
Stock shall cease to be, and shall have no rights as,
stockholders of BFL, other than to receive the consideration
provided under this Article II. After the Effective Date, there
shall be no transfers on the stock transfer books of BFL or the
Continuing Corporation of the shares of BFL Common Stock and BFL
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Preferred Stock which were issued and outstanding immediately
prior to the Effective Date.
2.03. Fractional Shares. Notwithstanding any other
provision hereof, no fractional shares of First Union Common
Stock and no certificates or scrip therefor, or other evidence of
ownership thereof, will be issued in the Corporate Merger;
instead, First Union shall pay to each holder of BFL Common Stock
or BFL Preferred Stock who would otherwise be entitled to a
fractional share an amount in cash determined by multiplying such
fraction by the last sale price of First Union Common Stock on
the last trading day prior to the Effective Date, as reported by
the NYSE Composite Transactions reporting system (as reported in
The Wall Street Journal).
2.04. Exchange Procedures. As promptly as practicable
after the Effective Date, First Union shall send or cause to be
sent to each former stockholder of BFL of record immediately
prior to the Effective Date transmittal materials for use in
exchanging such stockholder's certificates for BFL Common Stock
and BFL Preferred Stock for the consideration set forth in this
Article II. The certificates representing the shares of First
Union Common Stock into which shares of such stockholder's BFL
Common Stock and BFL Preferred Stock are converted on the
Effective Date, any fractional share checks which such
stockholder shall be entitled to receive, and any dividends paid
on such shares of First Union Common Stock for which the record
date for determination of stockholders entitled to such dividends
is on or after the Effective Date, will be delivered to such
stockholder only upon delivery to First Union National Bank of
North Carolina (the "Exchange Agent") of the certificates
representing all of such shares of BFL Common Stock and BFL
Preferred Stock (or indemnity satisfactory to First Union and the
Exchange Agent, in their judgment, if any of such certificates
are lost, stolen or destroyed). No interest will be paid on any
such fractional share checks or dividends to which the holder of
such shares shall be entitled to receive upon such delivery.
Certificates surrendered for exchange by any person constituting
an "affiliate" of BFL for purposes of Rule 145 of the Securities
Act (as hereinafter defined), shall not be exchanged for
certificates representing First Union Common Stock until First
Union has received a written agreement from such person as
specified in Section 5.10.
2.05. Anti-Dilution Provisions. In the event First
Union changes the number of shares of First Union Common Stock
issued and outstanding prior to the Effective Date as a result of
a stock split, stock dividend, recapitalization or similar
transaction with respect to the outstanding First Union Common
Stock and the record date therefor shall be prior to the
Effective Date, the Exchange Ratio shall be proportionately
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adjusted.
2.06. Treasury Shares. Each of the Treasury Shares of
BFL Common Stock shall be canceled and retired at the
effectiveness of the Corporate Merger and no consideration shall
be issued in exchange therefor.
2.07. Reservation of Right to Revise Transaction. First
Union may at any time change the method of effecting the
acquisition of BFL and the Bank by First Union (including without
limitation the provisions of this Article II) if and to the
extent it deems such change to be desirable; provided, however,
that no such change shall (i) alter or change the amount or kind
of consideration to be issued to holders of BFL Common Stock or
BFL Preferred Stock as provided for in this Plan, (ii) adversely
affect the tax treatment to BFL stockholders as a result of
receiving such consideration, or (iii) materially impede or delay
receipt of any approval referred to in Section 6.02 or the
consummation of the transactions contemplated by this Plan.
2.08. Options. From and after the Effective Date, all
employee stock options to purchase shares of BFL Common Stock
("Options"), which are then outstanding and unexercised, shall be
converted into and become options with respect to First Union
Common Stock, and First Union shall assume each such Option, in
accordance with the terms of the plan and agreement by which it
is evidenced. From and after the Effective Date, (i) each such
Option assumed by First Union may be exercised solely for shares
of First Union Common Stock, (ii) the number of shares of First
Union Common Stock subject to such Option shall be equal to the
number of shares of BFL Common Stock subject to such Option
immediately prior to the Effective Date multiplied by the
Exchange Ratio, and (iii) the per share exercise price under each
such Option shall be adjusted by dividing the per share exercise
price of each such Option by the Exchange Ratio, and rounding up
to the nearest cent. The number of shares of BFL Common Stock
which are issuable upon exercise of Options as of the date hereof
are Previously Disclosed in Schedule 2.08.
III. ACTIONS PENDING CONSUMMATION.
Without the prior written consent of First Union, each of
BFL and the Bank shall conduct its and each of its subsidiaries'
business in the ordinary and usual course consistent with past
practice and shall use its best efforts to maintain and preserve
its and each of its subsidiaries' business organization,
employees and advantageous business relationships and retain the
services of its and each of its subsidiaries' officers and key
employees identified by FUNB-FL, and each of BFL and the Bank
will not, and will cause each of its subsidiaries not to, agree
to:
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3.01. Capital Stock. Except for or as otherwise
permitted in or expressly contemplated by this Plan or the Stock
Option Agreement or as Previously Disclosed in Schedule 4.01(C),
issue, sell or otherwise permit to become outstanding any
additional shares of Bank Common Stock, Bank Preferred Stock, BFL
Common Stock, BFL Preferred Stock, or any other capital stock of
BFL, the Bank or any of their subsidiaries, or any Rights with
respect thereto, or enter into any agreement with respect to the
foregoing, or permit any additional shares of BFL Common Stock to
become subject to grants of employee stock options, stock
appreciation rights or similar stock based employee compensation
rights.
3.02. Dividends, Etc. Make, declare or pay any dividend
on or in respect of (other than dividends payable on BFL
Preferred Stock at a rate not exceeding the rate set forth in
BFL's Certificate of Incorporation and dividends from
subsidiaries to BFL or the Bank, as applicable), or declare or
make any distribution on, or directly or indirectly combine,
redeem, reclassify, purchase or otherwise acquire, any shares of
its capital stock or, other than as permitted in or contemplated
by this Plan or the Stock Option Agreement, authorize the
creation or issuance of, or issue, any additional shares of its
capital stock or any Rights with respect thereto.
3.03. Indebtedness; Liabilities; Etc. Other than in the
ordinary course of business consistent with past practice, incur
any indebtedness for borrowed money, assume, guarantee, endorse
or otherwise as an accommodation become responsible or liable for
the obligations of any other individual, corporation or other
entity.
3.04. Line of Business; Operating Procedures; Etc.
Except as may be directed by any regulatory agency, (i) change
its lending, [investment, liability management or other material
banking policies] in any material respect, except such changes as
are in accordance and in an effort to comply with Section 5.11,
or (ii) commit to incur any further capital expenditures beyond
those Previously Disclosed in Schedule 3.04 other than in the
ordinary course of business and not exceeding $100,000
individually or $500,000 in the aggregate.
3.05. Liens and Encumbrances. Impose, or suffer the
imposition, on any shares of stock of any of its subsidiaries,
any lien, charge or encumbrance, or permit any such lien, charge
or encumbrance to exist.
3.06. Compensation; Employment Agreements; Etc. Except
as Previously Disclosed in Schedule 3.06, enter into or amend any
employment, severance or similar agreement or arrangement with
any of its directors, officers or employees, or grant any salary
or wage increase, amend the terms of any Option or increase any
9
<PAGE>
employee benefit (including incentive or bonus payments), except
normal individual increases in regular compensation to employees
in the ordinary course of business consistent with past practice.
3.07. Benefit Plans. Except as Previously Disclosed in
Schedule 3.07, enter into or modify (except as may be required by
applicable law) any pension, retirement, stock option, stock
purchase, savings, profit sharing, deferred compensation,
consulting, bonus, group insurance or other employee benefit,
incentive or welfare contract, plan or arrangement, or any trust
agreement related thereto, in respect of any of its directors,
officers or other employees, including without limitation taking
any action that accelerates the vesting or exercise of any
benefits payable thereunder.
3.08. Continuance of Business. Dispose of or
discontinue any portion of its assets, business or properties,
which is material to BFL and its subsidiaries taken as a whole,
or merge or consolidate with, or acquire all or any portion of,
the business or property of any other entity which is material to
BFL and its subsidiaries taken as a whole (except foreclosures or
acquisitions by the Bank in its fiduciary capacity, in each case
in the ordinary course of business consistent with past
practice).
3.09. Amendments. Amend its Certificate of
Incorporation, Charter or By-laws.
3.10. Litigation. Settle any litigation at a cost in
excess of $2,000,000.
IV. REPRESENTATIONS AND WARRANTIES.
4.01. BFL and the Bank Representations and Warranties.
Each of BFL and the Bank hereby represents and warrants to First
Union, FUNC-FL and FUNB-FL as follows:
(A) Recitals. The facts set forth in the Recitals of
this Plan with respect to it are true and correct.
(B) Organization, Standing and Authority. It is duly
qualified to do business and is in good standing in the States of
the United States and foreign jurisdictions where the failure to
be duly qualified, individually or in the aggregate, is
reasonably likely to have a Material Adverse Effect (as
hereinafter defined) on it. Each of BFL and the BFL Subsidiaries
(as hereinafter defined) has in effect all federal, state, local,
and foreign governmental authorizations necessary for it to own
or lease its properties and assets and to carry on its business
as it is now conducted, the absence of which, individually or in
the aggregate, is reasonably likely to have a Material Adverse
Effect on it.
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(C) Shares. The outstanding shares of it are validly
issued and outstanding, fully paid and nonassessable, and subject
to no preemptive rights. Except as Previously Disclosed in
Schedule 4.01(C) and except as provided under the Stock Option
Agreement, there are no shares of capital stock or other equity
securities of BFL or the Bank outstanding and no outstanding
Rights with respect thereto. There will be no change in the
conversion price of the BFL Preferred Stock and the holder of the
BFL Preferred Stock will not have any rights to acquire any
shares of BFL Common Stock as a result of or by reason of the
transactions contemplated hereby and by the Stock Option
Agreement.
(D) BFL Subsidiaries. BFL has Previously Disclosed in
Schedule 4.01(D) a list of all the subsidiaries of BFL (each a
"BFL Subsidiary" and, collectively, the "BFL Subsidiaries").
Each of the BFL Subsidiaries that is a savings bank is an
"insured depository institution" as defined in the Federal
Deposit Insurance Act and applicable regulations thereunder. No
equity securities of any of the BFL Subsidiaries are or may
become required to be issued (other than to BFL or a BFL
Subsidiary) by reason of any Rights with respect thereto. There
are no contracts, commitments, understandings or arrangements by
which any of the BFL Subsidiaries is or may be bound to sell or
otherwise issue any shares of its capital stock, and there are no
contracts, commitments, understandings or arrangements relating
to the rights of BFL or the Bank, as applicable, to vote or to
dispose of such shares. All of the shares of capital stock of
each BFL Subsidiary held by BFL or a BFL Subsidiary are fully
paid and nonassessable and are owned by BFL or a BFL Subsidiary
free and clear of any charge, mortgage, pledge, security
interest, restriction, claim, lien or encumbrance. Each BFL
Subsidiary is in good standing under the laws of the jurisdiction
in which it is incorporated or organized, and is duly qualified
to do business and in good standing in the jurisdictions where
the failure to be duly qualified is reasonably likely,
individually or in the aggregate, to have a Material Adverse
Effect on it. Except as Previously Disclosed in Schedule
4.01(D), BFL does not own beneficially, directly or indirectly,
any shares of any equity securities or similar interests of any
corporation, bank, partnership, joint venture, business trust,
association or other organization. The deposits of the Bank are
insured by the Savings Insurance Fund (the "SAIF") of the
Federal Deposit Insurance Corporation (the "FDIC"). The Bank is
a member in good standing with the Federal Home Loan Bank of
Atlanta (the "FHL Bank").
(E) Corporate Power. It and each of the BFL
Subsidiaries has the corporate power and authority to carry on
its business as it is now being conducted and to own all its
material properties and assets.
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(F) Corporate Authority. Subject to any necessary
receipt of approval by its stockholders referred to in Section
6.01, each of this Plan and, as to BFL, the Stock Option
Agreement, has been authorized by all necessary corporate action
of it and is a valid and binding agreement of it enforceable
against it in accordance with its terms, subject to bankruptcy,
insolvency and other laws of general applicability relating to or
affecting creditors' rights and to general equity principles.
(G) No Defaults. Subject to the approval by its
stockholders referred to in Section 6.01, the required regulatory
approvals referred to in Section 6.02 , and the required filings
under federal and state securities laws, and except as Previously
Disclosed in Schedule 4.01(G), the execution, delivery and
performance of this Plan and, as to BFL, the Stock Option
Agreement, and the consummation by it of the transactions
contemplated hereby and thereby, does not and will not (i)
constitute a breach or violation of, or a default under, any law,
rule or regulation or any judgment, decree, order, governmental
permit or license, or agreement, indenture or instrument of it or
of any of the BFL Subsidiaries or to which it or any of the BFL
Subsidiaries or its or their properties is subject or bound,
which breach, violation or default is reasonably likely,
individually or in the aggregate, to have a Material Adverse
Effect on it, (ii) constitute a breach or violation of, or a
default under, its Articles of Incorporation, Charter or By-laws,
or (iii) require any consent or approval under any such law,
rule, regulation, judgment, decree, order, governmental permit or
license or the consent or approval of any other party to any
such agreement, indenture or instrument, other than any such
consent or approval, which if not obtained, would not be
reasonably likely, individually or in the aggregate, to have a
Material Adverse Effect on BFL.
(H) Financial Reports. Except as Previously Disclosed
in Schedule 4.01(H), (i) as to BFL, its Annual Report on Form
10-K for the fiscal year ended September 30, 1993, and all other
documents filed or to be filed subsequent to September 30, 1993
under Section 13(a), 13(c), 14 or 15(d) of the Securities
Exchange Act of 1934, as amended (together with the rules and
regulations thereunder, the "Exchange Act"), in the form filed
with the Securities and Exchange Commission (the "SEC") (in each
such case, the "BFL Financial Reports"), and (ii) as to the Bank,
its Thrift Financial Report for the fiscal year ended September
30, 1993, and all other Thrift Financial Reports filed or to be
filed subsequent to September 30, 1993, in the form filed with
the Office of Thrift Supervision (the "OTS") (in each case, the
"Bank Financial Reports" and together with the BFL Financial
Reports, the "BFL/Bank Financial Reports") did not and will not
contain any untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to
make the statements made therein, in light of the circumstances
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under which they were made, not misleading; and each of the
balance sheets in or incorporated by reference into the BFL/Bank
Financial Reports (including the related notes and schedules
thereto) fairly presents and will fairly present the financial
position of the entity or entities to which it relates as of its
date and each of the statements of income and changes in
stockholders' equity and cash flows or equivalent statements in
the BFL/Bank Financial Reports (including any related notes and
schedules thereto) fairly presents and will fairly present the
results of operations, changes in stockholders' equity and cash
flows, as the case may be, of the entity or entities to which it
relates for the periods set forth therein, in each case in
accordance with generally accepted accounting principles
consistently applied during the periods involved, except in each
case as may be noted therein, subject to normal and recurring
year-end audit adjustments in the case of unaudited statements.
(I) Absence of Undisclosed Liabilities. None of BFL
or the BFL Subsidiaries has any obligation or liability
(contingent or otherwise) that, individually or in the aggregate,
is reasonably likely to have a Material Adverse Effect on it,
except (i) as reflected in the BFL Financial Reports prior to the
date of this Plan, and (ii) for commitments and obligations made,
or liabilities incurred, in the ordinary course of its business
consistent with past practice since September 30, 1993. Since
September 30, 1993, none of BFL or the BFL Subsidiaries has
incurred or paid any obligation or liability (including any
obligation or liability incurred in connection with any
acquisitions in which any form of direct financial assistance of
the federal government or any agency thereof has been provided to
any BFL Subsidiary) which, individually or in the aggregate, is
reasonably likely to have a Material Adverse Effect on it.
(J) No Events. Except as Previously Disclosed on
Schedule 4.01(J), since September 30, 1993, no event has occurred
which, individually or in the aggregate, is reasonably likely to
have a Material Adverse Effect on it.
(K) Properties. Except as reserved against in the BFL
Financial Reports, BFL and the BFL Subsidiaries have good and
marketable title, free and clear of all liens, encumbrances,
charges, defaults, or equities of any character, to all of the
properties and assets, tangible and intangible, reflected in the
BFL Financial Reports as being owned by BFL or the BFL
Subsidiaries as of the dates thereof other than those that,
individually or in the aggregate, are not reasonably likely to
have a Material Adverse Effect on it, except those sold or
otherwise disposed of in the ordinary course of business. All
buildings and all material fixtures, equipment, and other
property and assets which are held under leases or subleases by
any of BFL or the BFL Subsidiaries are held under valid leases or
subleases enforceable in accordance with their respective terms,
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other than any such exceptions to validity or enforceability
that, individually or in the aggregate, are not reasonably likely
to have a Material Adverse Effect on BFL.
(L) Litigation; Regulatory Action. Except as
Previously Disclosed in Schedule 4.01(L), no litigation,
proceeding or controversy before any court or governmental agency
is pending which, individually or in the aggregate, is reasonably
likely to have a Material Adverse Effect on BFL or which alleges
claims under any fair lending law or other law relating to
discrimination, including, without limitation, the Equal Credit
Opportunity Act, the Fair Housing Act, the Community Reinvestment
Act and the Home Mortgage Disclosure Act, and, to the best of its
knowledge, no such litigation, proceeding or controversy has been
threatened; and except as Previously Disclosed in Schedule
4.01(L), neither it nor any of the BFL Subsidiaries or any of its
or their material properties or their officers, directors or
controlling persons is a party to or is subject to any order,
decree, agreement, memorandum of understanding or similar
arrangement with, or a commitment letter or similar submission
to, any federal or state governmental agency or authority charged
with the supervision or regulation of depository institutions or
engaged in the insurance of deposits (together with any and all
agencies or departments of federal, state or local government
(including, without limitation, the OTS, the FHL Bank, the
Federal Reserve Board, the FDIC and any other federal or state
bank, thrift or other financial institution, insurance and
securities regulatory authorities, the "Regulatory Authorities"))
and neither it nor any of the BFL Subsidiaries has been advised
by any of such Regulatory Authorities that such authority is
contemplating issuing or requesting (or is considering the
appropriateness of issuing or requesting) any such order, decree,
agreement, memorandum or understanding, commitment letter or
similar submission.
(M) Compliance with Laws. Except as Previously
Disclosed in Schedule 4.01(M), each of BFL and the BFL
Subsidiaries:
(1) has all permits, licenses, authorizations, orders
and approvals of, and has made all filings, applications and
registrations with, all Regulatory Authorities that are
required in order to permit it to own its businesses as
presently conducted and that are material to the business of
BFL and the BFL Subsidiaries taken as a whole; all such
permits, licenses, certificates of authority, orders and
approvals are in full force and effect and, to the best
knowledge of BFL, no suspension or cancellation of any of
them is threatened; and all such filings, applications and
registrations are current;
(2) has received no notification or communication from
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<PAGE>
any Regulatory Authority or the staff thereof (i) asserting
that any of BFL or the BFL Subsidiaries is not in compliance
with any of the statutes, regulations or ordinances which
such Regulatory Authority enforces, which, as a result of
such noncompliance in any such instance, individually or in
the aggregate, is reasonably likely to have a Material
Adverse Effect on BFL, (ii) threatening to revoke any
license, franchise, permit or governmental authorization,
which revocation, individually or in the aggregate, is
reasonably likely to have a Material Adverse Effect on BFL,
or (iii) requiring any of BFL or the BFL Subsidiaries (or
any of its officers, directors or controlling persons) to
enter into a cease and desist order, agreement or memorandum
of understanding (or requiring the board of directors
thereof to adopt any resolution or policy);
(3) is not required to give prior notice to any
federal banking or thrift agency of the proposed addition of
an individual to its board of directors or the employment of
an individual as a senior executive; and
(4) is in substantial compliance with all fair lending
laws or other laws relating to discrimination, including,
without limitation, the Equal Credit Opportunity Act, the
Fair Housing Act, the Community Reinvestment Act and the
Home Mortgage Disclosure Act.
(N) Material Contracts. Except as Previously Disclosed in
Schedule 4.01(N), none of BFL or the BFL Subsidiaries, nor any of
its respective assets, businesses or operations, is a party to,
or is bound or affected by, or receives benefits under, any
contract or agreement or amendment thereto that in each case
would be required to be filed as an exhibit to a Form 10-K filed
by BFL that has not been filed as an exhibit to BFL's Form 10-K
filed for the fiscal year ended September 30, 1993. None of BFL
or the BFL Subsidiaries is in default under any contract,
agreement, commitment, arrangement, lease, insurance policy or
other instrument to which it is a party, by which its respective
assets, business or operations may be bound or affected, or under
which it or any of its respective assets, business or operations
receives benefits, which default, individually or in the
aggregate, is reasonably likely to have a Material Adverse Effect
on BFL, and there has not occurred any event that, with the
lapse of time or the giving of notice or both, would constitute
such a default. Except as Previously Disclosed in Schedule
4.01(N), neither BFL nor any BFL Subsidiary is subject to or
bound by any contract containing covenants which limit the
ability of BFL or any BFL Subsidiary to compete in any line of
business or with any person or which involve any restriction of
geographical area in which, or method by which, BFL or any BFL
Subsidiary may carry on its business (other than as may be
required by law or any applicable Regulatory Authority).
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(O) Reports. Since October 1, 1990, each of BFL and the
BFL Subsidiaries has filed all reports and statements, together
with any amendments required to be made with respect thereto,
that it was required to file with (i) the FDIC, (ii) the OTS, the
FHL Bank and the Federal Home Loan Bank System, and (iii) any
other applicable Regulatory Authorities. As of their respective
dates (and without giving effect to any amendments or
modifications filed after the date of this Plan with respect to
reports and documents filed before the date of this Plan), each
of such reports and documents, including the financial
statements, exhibits and schedules thereto, complied in all
material respects with all of the statutes, rules and regulations
enforced or promulgated by the Regulatory Authority with which
they were filed and did not contain any untrue statement of a
material fact or omit to state any material fact necessary in
order to make the statements made therein, in light of the
circumstances under which they were made, not misleading.
(P) No Brokers. All negotiations relative to this
Plan and the transactions contemplated hereby have been carried
on by it directly with the other parties hereto and no action has
been taken by it that would give rise to any valid claim against
any party hereto for a brokerage commission, finder's fee or
other like payment, excluding a fee previously disclosed to First
Union to be paid to Alex. Brown & Sons Incorporated.
(Q) Employee Benefit Plans.
(1) Schedule 4.01(Q)(1) contains a complete list
of all bonus, deferred compensation, pension, retirement,
profit-sharing, thrift, savings, employee stock ownership,
stock bonus, stock purchase, restricted stock and stock
option plans, all employment or severance contracts, all
medical, dental, health and life insurance plans, all other
employee benefit plans, contracts or arrangements and any
applicable "change of control" or similar provisions in any
plan, contract or arrangement maintained or contributed to
by it or any of the BFL Subsidiaries for the benefit of
employees, former employees, directors, former directors or
their beneficiaries (the "Compensation and Benefit Plans").
True and complete copies of all Compensation and Benefit
Plans, including, but not limited to, any trust instruments
and/or insurance contracts, if any, forming a part thereof,
and all amendments thereto have been supplied to First
Union.
(2) All "employee benefit plans" within the
meaning of Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), other than
"multiemployer plans" within the meaning of Section 3(37) of
ERISA ("Multiemployer Plans"), covering employees or former
16
<PAGE>
employees of it and the BFL Subsidiaries (the "ERISA
Plans"), to the extent subject to ERISA, are in substantial
compliance with ERISA. Except as Previously Disclosed in
Schedule 4.01(Q)(2) each ERISA Plan which is an "employee
pension benefit plan" within the meaning of Section 3(2) of
ERISA ("Pension Plan") and which is intended to be qualified
under Section 401(a) of the Internal Revenue Code of 1986
(as amended, the "Code") has received a favorable
determination letter from the Internal Revenue Service, and
it is not aware of any circumstances reasonably likely to
result in the revocation or denial of any such favorable
determination letter or the inability to receive such a
favorable determination letter. There is no material
pending or, to its knowledge, threatened litigation relating
to the ERISA Plans. Neither it nor any of the BFL
Subsidiaries has engaged in a transaction with respect to
any ERISA Plan that could subject it or any of the BFL
Subsidiaries to a tax or penalty imposed by either Section
4975 of the Code or Section 502(i) of ERISA in an amount
which would be material.
(3) No liability under Subtitle C or D of Title IV
of ERISA has been or is expected to be incurred by it or any
of the BFL Subsidiaries with respect to any ongoing, frozen
or terminated "single-employer plan", within the meaning of
Section 4001(a)(15) of ERISA, currently or formerly
maintained by any of them, or the single-employer plan of
any entity which is considered one employer with it under
Section 4001(a)(15) of ERISA or Section 414 of the Code (an
"ERISA Affiliate"). Neither it nor any of the BFL
Subsidiaries presently contributes to a Multiemployer Plan,
nor have they contributed to such a plan within the past
five calendar years. No notice of a "reportable event",
within the meaning of Section 4043 of ERISA for which the
30-day reporting requirement has not been waived, has been
required to be filed for any Pension Plan or by any ERISA
Affiliate within the past 12-month period.
(4) All contributions required to be made under
the terms of any ERISA Plan have been timely made. Neither
any Pension Plan nor any single-employer plan of an ERISA
Affiliate has an "accumulated funding deficiency" (whether
or not waived) within the meaning of Section 412 of the Code
or Section 302 of ERISA. Neither it nor any of the BFL
Subsidiaries has provided, or is required to provide,
security to any Pension Plan or to any single-employer plan
of an ERISA Affiliate pursuant to Section 401(a)(29) of the
Code.
(5) Under each Pension Plan which is a
single-employer plan, as of the last day of the most recent
plan year, the actuarially determined present value of all
17
<PAGE>
"benefit liabilities", within the meaning of Section
4001(a)(16) of ERISA (as determined on the basis of the
actuarial assumptions contained in the plan's most recent
actuarial valuation) did not exceed the then current value
of the assets of such plan, and there has been no material
change in the financial condition of such plan since the
last day of the most recent plan year.
(6) Neither it nor any of the BFL Subsidiaries
has any obligations for retiree health and life benefits
under any plan, except as set forth in Schedule 4.01(Q)(6).
There are no restrictions on the rights of it or any of the
BFL Subsidiaries to amend or terminate any such plan without
incurring any liability thereunder.
(7) Except as Previously Disclosed in Schedule
4.01(Q)(7), neither the execution and delivery of this Plan
nor the consummation of the transactions contemplated hereby
will (i) result in any payment (including, without
limitation, severance, unemployment compensation, golden
parachute or otherwise) becoming due to any director or any
employee of it or any of the BFL Subsidiaries under any
Compensation and Benefit Plan or otherwise from it or any of
the BFL Subsidiaries, (ii) increase any benefits otherwise
payable under any Compensation and Benefit Plan, or (iii)
result in any acceleration of the time of payment or vesting
of any such benefit.
(R) No Knowledge. It knows of no reason why the
regulatory approvals referred to in Section 6.02 should not be
obtained .
(S) Labor Agreements. Neither it nor any of the BFL
Subsidiaries is a party to, or is bound by any collective
bargaining agreement, contract or other agreement or
understanding with a labor union or labor organization, nor is it
or any of the BFL Subsidiaries the subject of a proceeding
asserting that it or any such subsidiary has committed an unfair
labor practice (within the meaning of the National Labor
Relations Act) or seeking to compel it or such subsidiary to
bargain with any labor organization as to wages and conditions of
employment, nor is there any strike or other labor dispute
involving it or any of the BFL Subsidiaries, pending or, to the
best of its knowledge, threatened, nor is it aware of any
activity involving its or any of the BFL Subsidiaries' employees
seeking to certify a collective bargaining unit or engaging in
any other organization activity.
(T) Asset Classification. It has Previously Disclosed
in Schedule 4.01(T) a list, accurate and complete in all material
respects, of the aggregate amounts of loans, extensions of credit
18
<PAGE>
or other assets of BFL and the BFL Subsidiaries that have been
classified by it as of December 31, 1993 (the "Asset
Classification"); and no amounts of loans, extensions of credit
or other assets that have been classified as of December 31, 1993
by any regulatory examiner as "Other Loans Specially Mentioned",
"Substandard", "Doubtful", "Loss", or words of similar import are
excluded from the amounts disclosed in the Asset Classification,
other than amounts of loans, extensions of credit or other assets
that were charged off by BFL or BFL Subsidiary prior to December
31, 1993.
(U) Allowance for Possible Loan Losses. The allowance
for possible loan losses shown on the consolidated balance sheets
of BFL included in the September 30, 1993 BFL Financial Reports
was, and the allowance for possible loan losses to be shown on
subsequent BFL Financial Reports, will be, adequate, determined
in accordance with generally accepted accounting principles, to
provide for possible losses, net of recoveries relating to loans
previously charged off, on loans outstanding (including accrued
interest receivable) as of the date thereof.
(V) Insurance. Each of BFL and the BFL Subsidiaries
has taken all requisite action (including without limitation the
making of claims and the giving of notices) pursuant to its
directors' and officers' liability insurance policy or policies
in order to preserve all rights thereunder with respect to all
matters (other than matters arising in connection with this Plan
and the transactions contemplated hereby) that are known to BFL,
except for such matters which, individually or in the aggregate,
are not reasonably likely to have a Material Adverse Effect on
it. Set forth in Schedule 4.01(V) is a list of all insurance
policies maintained by or for the benefit of BFL or the BFL
Subsidiaries or their directors, officers, employees or agents.
(W) Affiliates. Except as Previously Disclosed in
Schedule 4.01(W), to the best of its knowledge, there is no
person who, as of the date of this Plan, may be deemed to be an
"affiliate" of BFL as that term is used in Rule 145 under the
Securities Act of 1933, as amended (together with the rules and
regulations thereunder, the "Securities Act").
(X) State Takeover Laws; Certificate of Incorporation.
It has taken all necessary action to exempt this Plan and, as to
BFL, the Stock Option Agreement and the transactions contemplated
hereby and thereby from, and this Plan, the Stock Option
Agreement and the transactions contemplated hereby and thereby
are exempt from, (i) any applicable state takeover laws,
including, without limitation, Section 203 of the Delaware
General Corporation Law, and (ii) Section 13 of BFL's Certificate
of Incorporation.
(Y) No Further Action. It has taken all action so
19
<PAGE>
that the entering into of this Plan and, as to BFL, the Stock
Option Agreement, and the consummation of the transactions
contemplated hereby and thereby (including without limitation the
Mergers and the exercise of the Option (as defined in the Stock
Option Agreement)) or any other action or combination of actions,
or any other transactions, contemplated hereby or thereby do not
and will not (i) require a vote of stockholders (other than as
set forth in Section 6.01), or (ii) result in the grant of any
rights to any person under the Certificate of Incorporation,
Charter or By-laws of BFL or any BFL Subsidiary or under any
agreement to which BFL or any of the BFL Subsidiaries is a party,
or (iii) restrict or impair in any way the ability of First
Union, FUNC-FL or FUNB-FL to exercise the rights granted
hereunder or, as to First Union, under the Stock Option
Agreement.
(Z) Environmental Matters.
(1) To its knowledge, it and each of the BFL
Subsidiaries, the Participation Facilities and the
Loan/Fiduciary Properties (each as defined below) are, and
have been, in compliance with all Environmental Laws (as
defined below), except for instances of noncompliance which
are not reasonably likely, individually or in the aggregate,
to have a Material Adverse Effect on BFL.
(2) There is no proceeding pending or, to its
knowledge, threatened before any court, governmental agency
or board or other forum in which it or any of the BFL
Subsidiaries or any Participation Facility has been, or with
respect to threatened proceedings, reasonably would be
expected to be, named as a defendant or potentially
responsible party (i) for alleged noncompliance (including
by any predecessor) with any Environmental Law, or (ii)
relating to the release or threatened release into the
environment of any Hazardous Material (as defined below),
whether or not occurring at or on a site owned, leased or
operated by it or any of the BFL Subsidiaries or any
Participation Facility, except for such proceedings pending
or threatened that are not reasonably likely, individually
or in the aggregate, to have a Material Adverse Effect on it
or have been Previously Disclosed in Schedule 4.01(Z)(2).
(3) There is no proceeding pending or, to its
knowledge, threatened before any court, governmental agency
or board or other forum in which any Loan/Fiduciary
Property (or it or any of the BFL Subsidiaries in respect of
any Loan/Fiduciary Property) has been, or with respect to
threatened proceedings, reasonably would be expected to be,
named as a defendant or potentially responsible party (i)
for alleged noncompliance (including by any predecessor)
with any Environmental Law, or (ii) relating to the release
20
<PAGE>
or threatened release into the environment of any Hazardous
Material, whether or not occurring at or on a
Loan/Fiduciary Property, except for such proceedings pending
or threatened that are not reasonably likely, individually
or in the aggregate, to have a Material Adverse Effect on it
or have been Previously Disclosed in Schedule 4.01(Z)(3).
(4) To its knowledge, there is no reasonable
basis for any proceeding of a type described in
subparagraphs (2) or (3) above, except as has been
Previously Disclosed in Schedule 4.01(Z)(4).
(5) To its knowledge, during the period of (i)
its or any of the BFL Subsidiaries' ownership or operation
of any of their respective current properties, (ii) its or
any of the BFL Subsidiaries' participation in the management
of any Participation Facility, or (iii) its or any of the
BFL Subsidiaries' holding of a security or other interest in
a Loan/Fiduciary Property, there have been no releases of
Hazardous Material in, on, under or affecting any such
property, Participation Facility or Loan/Fiduciary
Property, except for such releases that are not reasonably
likely, individually or in the aggregate, to have a Material
Adverse Effect on it or have been Previously Disclosed in
Schedule 4.01(Z)(5).
(6) To its knowledge, prior to the period of (i)
its or any of the BFL Subsidiaries' ownership or operation
of any of their respective current properties, (ii) its or
any of the BFL Subsidiaries' participation in the management
of any Participation Facility, or (iii) its or any of the
BFL Subsidiaries' holding of a security or other interest in
a Loan/Fiduciary Property, there were no releases of
Hazardous Material in, on, under or affecting any such
property, Participation Facility or Loan/Fiduciary
Property, except for such releases that are not reasonably
likely, individually or in the aggregate, to have a Material
Adverse Effect on it or have been Previously Disclosed in
Schedule 4.01(Z)(6).
(7) The following definitions apply for purposes
of this Section 4.01(Z): "Loan/Fiduciary Property" means
any property owned or controlled by it or any of the BFL
Subsidiaries or in which it or any of the BFL Subsidiaries
holds a security or other interest, and, where required by
the context, includes any such property where BFL or any of
the BFL Subsidiaries constitutes the owner or operator of
such property, but only with respect to such property;
"Participation Facility" means any facility in which it or
any of the BFL Subsidiaries participates in the management
and, where required by the context, includes the owner or
operator or such property, but only with respect to such
21
<PAGE>
property; "Environmental Law" means (i) any federal, state
and local law, statute, ordinance, rule, regulation, code,
license, permit, authorization, approval, consent, legal
doctrine, order, judgment, decree, injunction, requirement
or agreement with any governmental entity, relating to (a)
the protection, preservation or restoration of the
environment, (including, without limitation, air, water
vapor, surface water, groundwater, drinking water supply,
surface land, subsurface land, plant and animal life or any
other natural resource), or to human health or safety, or
(b) the exposure to, or the use, storage, recycling,
treatment, generation, transportation, processing, handling,
labeling, production, release or disposal of Hazardous
Material, in each case as amended and as now in effect and
includes, without limitation, the federal Comprehensive
Environmental Response, Compensation, and Liability Act of
1980, the Superfund Amendments and Reauthorization Act, the
Federal Water Pollution Control Act of 1972, the federal
Clean Air Act, the federal Clean Water Act, the federal
Resource Conservation and Recovery Act of 1976 (including
the Hazardous and Solid Waste Amendments thereto), the
federal Solid Waste Disposal and the federal Toxic
Substances Control Act, and the Federal Insecticide,
Fungicide and Rodenticide Act, the Federal Occupational
Safety and Health Act of 1970, each as amended and as now in
effect, and (ii) any common law or equitable doctrine
(including, without limitation, injunctive relief and tort
doctrines such as negligence, nuisance, trespass and strict
liability) that may impose liability or obligations for
injuries or damages due to, or threatened as a result of,
the presence of or exposure to any Hazardous Material;
"Hazardous Material" means any substance presently listed,
defined, designated or classified as hazardous, toxic,
radioactive or dangerous, or otherwise regulated, under any
Environmental Law, whether by type or quantity, and
includes, without limitation, any oil or other petroleum
product, toxic waste, pollutant, contaminant, hazardous
substance, toxic substance, hazardous waste, special waste
or petroleum or any derivative or by-product thereof, radon,
radioactive material, asbestos, asbestos containing
material, urea formaldehyde foam insulation, lead and
polychlorinated biphenyl.
(AA) Option Shares. As to BFL, the Option Shares (as
defined in the Stock Option Agreement), when issued upon exercise
of the Option, will be validly issued, fully paid and
nonassessable and subject to no preemptive rights.
(BB) Tax Reports. Except as Previously Disclosed in
Schedule 4.01(BB), (i) all reports and returns with respect to
Taxes (as defined below) that are required to be filed by or with
respect to it or the BFL Subsidiaries, including without
22
<PAGE>
limitation consolidated federal income tax returns of it and the
BFL Subsidiaries (collectively, the "BFL Tax Returns"), have been
duly filed, or requests for extensions have been timely filed and
have not expired, for periods ended on or prior to the most
recent fiscal year end, except to the extent all such failures to
file, taken together, are not reasonably likely to have a
Material Adverse Effect on it, and such BFL Tax Returns were
true, complete and accurate in all material respects, (ii) all
taxes (which shall mean federal, state, local or foreign income,
gross receipts, windfall profits, severance, property,
production, sales, use, license, excise, franchise, employment,
withholding or similar taxes imposed on the income, properties or
operations of it or the BFL Subsidiaries, together with any
interest, additions, or penalties with respect thereto and any
interest in respect of such additions or penalties, collectively
the "Taxes") shown to be due on the BFL Tax Returns have been
paid in full, (iii) the BFL Tax Returns have been examined by the
Internal Revenue Service or the appropriate state, local or
foreign taxing authority or the period for assessment of the
Taxes in respect of which such BFL Tax Returns were required to
be filed has expired, (iv) all Taxes due with respect to
completed and settled examinations have been paid in full, (v) no
issues have been raised by the relevant taxing authority in
connection with the examination of any of the BFL Tax Returns
which are reasonably likely, individually or in the aggregate, to
result in a determination that would have a Material Adverse
Effect on it, except as reserved against in the BFL Financial
Reports, and (vi) no waivers of statutes of limitations
(excluding such statutes that relate to years under examination
by the Internal Revenue Service) have been given by or requested
with respect to any Taxes of it or the BFL Subsidiaries.
(CC) Accuracy of Information. The statements with
respect to BFL and the BFL Subsidiaries contained in this Plan,
the Stock Option Agreement, the Schedules and any other written
documents executed and delivered by or on behalf of BFL or the
Bank pursuant to the terms of this Plan are true and correct in
all material respects, and such statements and documents do not
omit any material fact necessary to make the statements contained
therein, in light of the circumstances under which they were
made, not misleading.
(DD) No Dissenters' Rights. The holders of BFL Common
Stock and, assuming compliance by the holder of BFL Preferred
Stock under the agreement set forth in Exhibit B hereto, the
holder of BFL Preferred Stock have no dissenters' or appraisal
rights in connection with the execution of this Plan, the Stock
Option Agreement or the consummation of any of the transactions
contemplated hereby or thereby.
4.02. First Union, FUNC-FL and FUNB-FL
23
<PAGE>
Representations and Warranties. Each of First Union, FUNC-FL and
FUNB-FL hereby represents and warrants to BFL and the Bank, as
follows:
(A) Recitals. The facts set forth in the Recitals of
this Plan with respect to it are true and correct.
(B) Corporate Authority. Subject to the required
regulatory approvals referred to in Section 6.02, each of this
Plan and, in the case of First Union, the Stock Option Agreement,
has been authorized by all necessary corporate action of it and
is a valid and binding agreement of it enforceable against it in
accordance with its terms, subject to bankruptcy, insolvency and
other laws of general applicability relating to or affecting
creditors' rights and to general equity principles.
(C) No Defaults. Subject to the required regulatory
approvals referred to in Section 6.02 herein, in the case of
First Union, Section 3 of the Stock Option Agreement, and the
required filings under federal and state securities' laws, the
execution, delivery and performance of this Plan and (in the case
of First Union) the Stock Option Agreement, and the consummation
of the transactions contemplated hereby and thereby by it, do not
and will not (i) constitute a breach or violation of, or a
default under, any law, rule or regulation or any judgment,
decree, order, governmental permit or license, or agreement,
indenture or instrument of it or of any of its subsidiaries or to
which it or any of its subsidiaries or properties is subject or
bound, which breach, violation or default is reasonably likely to
have a Material Adverse Effect on it, (ii) constitute a breach or
violation of, or a default under, its Articles of Incorporation,
Charter or Bylaws, or (iii) require any consent or approval under
any such law, rule, regulation, judgment, decree, order,
governmental permit or license, or the consent or approval of any
other party to any such agreement, indenture or instrument.
(D) Financial Reports. Except as Previously Disclosed
in Schedule 4.02(D), in the case of First Union, its Annual
Report on Form 10-K for the fiscal year ended December 31, 1992,
and all other documents filed or to be filed subsequent to
December 31, 1992 under Sections 13(a), 13(c), 14 or 15(d) of the
Exchange Act, in the form filed with the SEC (in each such case,
the "First Union Financial Reports"), did not and will not
contain any untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to
make the statements made therein, in light of the circumstances
under which they were made, not misleading; and each of the
balance sheets in or incorporated by reference into the First
Union Financial Reports (including the related notes and
schedules thereto) fairly presents and will fairly present the
financial position of the entity or entities to which it relates
24
<PAGE>
as of its date and each of the statements of income and changes
in stockholders' equity and cash flows or equivalent statements
in the First Union Financial Reports (including any related notes
and schedules thereto) fairly presents and will fairly present
the results of operations, changes in stockholders' equity and
changes in cash flows, as the case may be, of the entity or
entities to which it relates for the periods set forth therein,
in each case in accordance with generally accepted accounting
principles consistently applied to banks and bank holding
companies during the periods involved, except as may be noted
therein, subject to normal and recurring year-end audit
adjustments in the case of unaudited statements.
(E) No Events. Except as Previously Disclosed in
Schedule 4.02(E), since September 30, 1993, no event has occurred
which is reasonably likely to have a Material Adverse Effect on
it.
(F) No Brokers. All negotiations relative to this
Plan and the transactions contemplated hereby have been carried
on by it directly with the other parties hereto and no action has
been taken by it that would give rise to any valid claim against
any party hereto for a brokerage commission, finder's fee or
other like payment.
(G) No Knowledge. It knows of no reason why the
regulatory approvals referred to in Section 6.02 should not be
obtained without the imposition of any condition of the type
referred to in the proviso following such Section 6.02.
(H) Shares Authorized. In the case of First Union,
the shares of First Union Common Stock to be issued (i) in
exchange for shares of BFL Common Stock and BFL Preferred Stock
upon consummation of the Corporate Merger in accordance with
Article II of this Plan, (ii) upon exercise of outstanding
Options pursuant to Section 2.08, and (iii) upon conversion of
BFL's outstanding convertible subordinated debentures due October
1, 2003, have been duly authorized and, when issued in accordance
with the terms of this Plan, will be validly issued, fully paid
and nonassessable and subject to no preemptive rights.
(I) Organization, Standing and Authority. It is duly
qualified to do business and is in good standing in the States of
the United States and foreign jurisdictions where the failure to
be duly qualified, individually or in the aggregate, is
reasonably likely to have a Material Adverse Effect on it. Each
of First Union and its subsidiaries has in effect all federal,
state, local and foreign governmental authorizations necessary
for it to own or lease its properties and assets and to carry on
its business as it is now conducted, the absence of which,
individually or in the aggregate, is reasonably likely to have a
Material Adverse Effect on First Union.
25
<PAGE>
(J) Corporate Power. First Union, FUNC-FL and FUNB-FL
each has the corporate power and authority to carry on its
business as it is now being conducted and to own all its material
properties and assets.
(K) Accuracy of Information. The statements with
respect to First Union and its subsidiaries contained in this
Plan, the Stock Option Agreement, the Schedules and any other
written documents executed and delivered by or on behalf of First
Union, FUNC-FL or FUNB-FL pursuant to the terms of this Plan are
true and correct in all material respects, and such statements
and documents do not omit any material fact necessary to make the
statements contained therein, in light of the circumstances
under which they were made, not misleading.
(L) No Dissenters' Rights. The holders of First Union
Common Stock have no dissenters' or appraisal rights in
connection with the execution of this Plan, the Stock Option
Agreement or the consummation of any of the transactions
contemplated hereby or thereby.
V. COVENANTS.
Each of BFL and the Bank hereby covenants to First Union,
FUNC-FL and FUNB-FL, and each of First Union, FUNC-FL and FUNB-FL
hereby covenants to BFL and the Bank, that:
5.01. Best Efforts. Subject to the terms and conditions
of this Plan and to the exercise by its Board of Directors of
such Board's fiduciary duties, it shall use its best efforts in
good faith to take, or cause to be taken, all actions, and to do,
or cause to be done, all things necessary, proper or desirable,
or advisable under applicable laws, so as to permit consummation
of the Mergers on the Effective Date and to otherwise enable
consummation of the transactions contemplated hereby and (in the
case of BFL and First Union) by the Stock Option Agreement and
shall cooperate fully with the other parties hereto to that end
(it being understood that any amendments to the Registration
Statement (as hereinafter defined) or a resolicitation of proxies
as a consequence of an acquisition agreement by First Union or
any of its subsidiaries shall not violate this covenant).
5.02. BFL Proxy. In the case of BFL, it shall promptly
prepare a proxy statement (the "Proxy Statement") to be mailed to
the holders of BFL Common Stock in connection with the
transactions contemplated hereby and to be filed by First Union
in a registration statement (the "Registration Statement") with
the SEC as provided in Section 5.08, which shall conform to all
applicable legal requirements and it shall call a special meeting
(the "Meeting") of the holders of BFL Common Stock to be held as
soon as practicable for purposes of voting upon the transactions
26
<PAGE>
contemplated hereby and BFL shall use its best efforts to solicit
and obtain votes of the holders of BFL Common Stock in favor of
the transactions contemplated hereby and, subject to the exercise
of its fiduciary duties, the Board of Directors of BFL shall
recommend approval of such transactions by such holders and by
the holder of BFL Preferred Stock.
5.03. Registration Statement Compliance with Securities
Laws. When the Registration Statement or any post-effective
amendment or supplement thereto shall become effective, and at
all times subsequent to such effectiveness, up to and including
the date of the Meeting, such Registration Statement and all
amendments or supplements thereto, with respect to all
information set forth therein furnished or to be furnished by or
on behalf of BFL relating to BFL or the BFL Subsidiaries and by
or on behalf of First Union relating to First Union or its
subsidiaries, (i) will comply in all material respects with the
provisions of the Securities Act and any other applicable
statutory or regulatory requirements, and (ii) will not contain
any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make
the statements contained therein not misleading; provided,
however, in no event shall any party hereto be liable for any
untrue statement of a material fact or omission to state a
material fact in the Registration Statement made in reliance
upon, and in conformity with, written information concerning
another party furnished by or on behalf of such other party
specifically for use in the Registration Statement.
5.04. Registration Statement Effectiveness. First Union
will advise BFL, promptly after First Union receives notice
thereof, of the time when the Registration Statement has become
effective or any supplement or amendment has been filed, of the
issuance of any stop order or the suspension of the qualification
of the First Union Common Stock for offering or sale in any
jurisdiction, of the initiation or threat of any proceeding for
any such purpose, or of any request by the SEC for the amendment
or supplement of the Registration Statement or for additional
information.
5.05. Press Releases. BFL and the Bank will not,
without the prior approval of First Union, and First Union will
not, without the prior approval of BFL, issue any press release
or written statement for general circulation relating to the
transactions contemplated hereby, except as otherwise required by
law.
5.06. Access; Information. (1) Upon reasonable notice,
BFL and the Bank shall afford First Union and its officers,
employees, counsel, accountants and other authorized
representatives, access, during normal business hours throughout
the period prior to the Effective Date, to all of its and the BFL
27
<PAGE>
Subsidiaries' properties, books, contracts, commitments and
records and, during such period, BFL and the Bank shall furnish
promptly to First Union (i) a copy of each material report,
schedule and other document filed by BFL and the BFL
Subsidiaries with any Regulatory Authority, and (ii) all other
information concerning the business, properties and personnel of
BFL and the BFL Subsidiaries as First Union may reasonably
request, provided that no investigation pursuant to this Section
5.06 shall affect or be deemed to modify or waive any
representation or warranty made by BFL or the Bank or the
conditions to the obligations of BFL and the Bank to consummate
the transactions contemplated by this Plan; and (2) First Union
will not use any information obtained pursuant to this Section
5.06 for any purpose unrelated to the consummation of the
transactions contemplated by this Plan and, if this Plan is
terminated, will hold all information and documents obtained
pursuant to this paragraph in confidence (as provided in Section
8.06) unless and until such time as such information or documents
become publicly available other than by reason of any action or
failure to act by First Union or as it is advised by counsel that
any such information or document is required by law or applicable
stock exchange rule to be disclosed, and in the event of the
termination of this Plan, First Union will, upon request by BFL,
deliver to BFL all documents so obtained by First Union or
destroy such documents and, in the case of destruction, will
certify such fact to BFL.
5.07. Acquisition Proposals. In the case of BFL,
without the prior written consent of First Union, it shall not,
and it shall cause the BFL Subsidiaries not to, solicit or
encourage inquiries or proposals with respect to, or, except as
required by the fiduciary duties of the Board of Directors of BFL
(as advised in writing by its outside counsel), furnish any
nonpublic information relating to or participate in any
negotiations or discussions concerning, any acquisition or
purchase of all or a substantial portion of the assets of, or a
substantial equity interest in, BFL or any of the BFL
Subsidiaries or any merger or other business combination with BFL
or any of the BFL Subsidiaries other than as contemplated by this
Plan; it shall instruct its and the BFL Subsidiaries' officers,
directors, agents, advisors and affiliates to refrain from doing
any of the foregoing; and it shall notify First Union immediately
if any such inquiries or proposals are received by, or any such
negotiations or discussions are sought to be initiated with, BFL
or any of the BFL Subsidiaries.
5.08. Registration Statement Preparation. In the case
of First Union, it shall, as promptly as practicable following
the date of this Plan, prepare and file the Registration
Statement with the SEC and First Union shall use its best efforts
to cause the Registration Statement to be declared effective as
soon as practicable after the filing thereof.
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5.09. Blue-Sky Filings. In the case of First Union, it
shall use its best efforts to obtain, prior to the effective date
of the Registration Statement, all necessary state securities
laws or "blue sky" permits and approvals, provided that First
Union shall not be required by virtue thereof to submit to
general jurisdiction in any state.
5.10. Affiliate Agreements. In the case of BFL, it will
use its best efforts to induce each person who may be deemed to
be an "affiliate" of BFL for purposes of Rule 145 under the
Securities Act to execute and deliver to First Union on or before
the mailing of the Proxy Statement for the Meeting an agreement
in the form attached hereto as Exhibit C restricting the
disposition of such affiliate's shares of BFL Common Stock and
BFL Preferred Stock and the shares of First Union Common Stock to
be received by such person in exchange for such person's shares
of BFL Common Stock and BFL Preferred Stock. In the case of
First Union, First Union agrees to use its best efforts to
maintain the availability of Rule 145 for use by such
"affiliates".
5.11. Certain Policies of BFL and the Bank. In the case
of each of BFL and the Bank, it shall use its best efforts to
modify and change its loan, litigation and other reserve and real
estate valuation policies and practices (including loan
classifications and levels of reserves) prior to the Effective
Date so as to be consistent on a mutually satisfactory basis with
those of First Union and generally accepted accounting
principles; provided, however, that prior to any such
modification or change, First Union shall certify that the
conditions to the obligation of First Union to consummate the
transactions contemplated hereby, other than those set forth in
Sections 6.04, 6.06, 6.08, 6.11 and 6.13, have been satisfied or
waived. BFL's and the Bank's representations, warranties and
covenants contained in this Plan shall not be deemed to be untrue
or breached in any respect for any purpose as a consequence of
any modifications or changes undertaken solely on account of this
Section 5.11.
5.12. State Takeover Law. In the case of BFL, BFL shall
not take any action that would cause the transactions
contemplated by this Plan or the Stock Option Agreement to be
subject to any applicable state takeover statute and BFL shall
take all necessary steps to exempt (or ensure the continued
exemption of) the transactions contemplated by this Plan and the
Stock Option Agreement from, or, if necessary, challenge the
validity or applicability of, any applicable state takeover law,
as now or hereafter in effect, including, without limitation,
Section 203 of the Delaware General Corporation Law.
5.13. No Rights Triggered. In the case of BFL, BFL
shall take all necessary steps to ensure that the entering into
of this Plan and the Stock Option Agreement and the consummation
of the transactions contemplated hereby and thereby (including
without limitation the Mergers and the exercise of the Option)
29
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and any other action or combination of actions, or any other
transactions contemplated hereby or thereby do not and will not
(i) result in the grant of any rights to any person under the
Articles of Incorporation or Bylaws of BFL or under any agreement
to which BFL or any of the BFL Subsidiaries is a party, or (ii)
restrict or impair in any way the ability of First Union, FUNC-FL
or FUNB-FL to exercise the rights granted hereunder or, as to
First Union, under the Stock Option Agreement.
5.14. Shares Listed. In the case of First Union, it
shall use its best efforts to list, prior to the Effective Date,
on the NYSE, upon official notice of issuance, the shares of
First Union Common Stock to be issued to the holders of BFL
Common Stock , BFL Preferred Stock, the outstanding Options
referred to in Section 2.08 and the outstanding BFL convertible
subordinated debentures due October 1, 2003, pursuant to this
Plan.
5.15. Regulatory Applications. In the case of First
Union, FUNC-FL and FUNB-FL, (i) it shall promptly prepare and
submit applications to the appropriate Regulatory Authorities for
approval of the Mergers, and (ii) promptly make all other
appropriate filings to secure all other approvals, consents and
rulings which are necessary for the consummation of the Mergers
by First Union, FUNC-FL and FUNB-FL.
5.16 Regulatory Divestitures. In the case of BFL,
effective on or before the Effective Date, BFL shall cease
engaging in such activities as First Union shall advise BFL in
writing are not permitted to be engaged in by First Union under
applicable law following the Effective Date and, to the extent
required by any Regulatory Authority as a conditional approval of
the transactions contemplated by this Agreement, BFL shall divest
any subsidiary engaged in activities or holding assets that are
impermissible for a bank holding company, on terms and conditions
agreed to by First Union.
5.17 Indemnification.
(a) For six years after the Effective Date, First Union
shall, and shall cause the Continuing Corporation to, indemnify,
defend and hold harmless the present and former directors,
officers and employees of BFL and the BFL Subsidiaries (each, an
"Indemnified Party") against all liabilities arising out of
actions or omissions occurring at or prior to the Effective Date
(including, without limitation, the transactions contemplated by
this Plan and the Stock Option Agreement) to the extent such
persons are indemnified under the Delaware General Corporation
Law and BFL's Certificate of Incorporation and By-laws as in
effect on the date hereof, including provisions relating to
advances of expenses incurred in the defense of any litigation.
Without limiting the foregoing, in any case in which approval by
the Continuing Corporation is required to effectuate any
indemnification, First Union shall cause the Continuing
Corporation to direct, at the election of the Indemnified Party,
30
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that the determination of any such approval shall be made by
independent counsel mutually agreed upon between First Union and
the Indemnified Party.
(b) First Union shall provide coverage under its existing
directors' and officers' liability insurance policy for persons
who are currently covered by BFL's existing directors' and
officers' liability policy insurance for a period of three years
after the Effective Date.
(c) Any Indemnified Party wishing to claim indemnification
under paragraph (a) of this Section 5.17, upon learning of such
claim, action, suit, proceeding or investigation, shall promptly
notify First Union thereof; provided, that the failure so to
notify shall not affect the obligations of First Union and the
Continuing Corporation under paragraph (a) of this Section 5.17
(unless such failure materially and adversely increases First
Union's liability under such paragraph (a)). In the event of any
such claim, action, suit, proceeding or investigation (whether
arising before or after the Effective Date), (i) First Union or
the Continuing Corporation shall have the right to assume the
defense thereof and First Union or the Continuing Corporation
shall pay all reasonable fees and expenses of such counsel for
the Indemnified Parties promptly as statements therefor are
received; provided, however, that First Union shall be obligated
pursuant to this paragraph (c) to pay for only one firm of
counsel for all Indemnified Parties in any jurisdiction for any
single action, suit or proceeding, (ii) the Indemnified Parties
will cooperate in the defense of any such matter, and (iii) First
Union shall not be liable for any settlement effected without its
prior written consent.
(d) If First Union or the Continuing Corporation or any of
its successors or assigns shall consolidate with or merge into
any other entity and shall not be the continuing or surviving
entity of such consolidation or merger or shall transfer all or
substantially all of its assets to any entity, then and in each
case, proper provision shall be made so that the successors and
assigns of First Union or the Continuing Corporation shall assume
the obligations set forth in this Section 5.17.
(e) First Union shall pay, or cause the Continuing
Corporation to pay, all expenses, including attorneys' fees, that
may be incurred by any Indemnified Party in enforcing the
indemnity and other obligations provided for in this Section
5.17. The rights of each Indemnified Party hereunder shall be in
addition to any other rights such Indemnified Party may have
under the Certificate of Incorporation or By-laws of BFL, under
the Delaware General Corporation Law or otherwise.
VI. CONDITIONS TO CONSUMMATION OF THE MERGERS.
Consummation of the Mergers is conditioned upon:
6.01. Shareholder Vote. Approval of the transactions
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contemplated hereby by the requisite vote of the stockholders of
BFL, as may be required.
6.02. Regulatory Approvals. Procurement by First Union,
FUNC-FL and FUNB-FL of regulatory consents and approvals by the
appropriate Regulatory Authorities and the expiration of the
statutory waiting period relating thereto; provided, however,
that no such approval or consent shall have imposed any
condition or requirement which, in the opinion of First Union
would so materially adversely impact the economic or business
benefits to First Union of the transactions contemplated by this
Plan so as to render inadvisable the consummation of the
Mergers.
6.03. No Injunction. There shall not be in effect any
order, decree or injunction of any court or agency of competent
jurisdiction that enjoins or prohibits consummation of any of the
transactions contemplated hereby .
6.04. KPMG Peat Marwick Letters. First Union shall have
received from KPMG Peat Marwick letters, dated the date of or
shortly prior to (i) the mailing of the Proxy Statement, and (ii)
the Effective Date, in form and substance satisfactory to First
Union, with respect to BFL's consolidated financial position and
results of operations, which letters shall be based upon "agreed
upon procedures" undertaken by such firm.
6.05. Legal Opinion. BFL and the Bank shall have
received an opinion, dated the Effective Date, of Marion A.
Cowell, Jr., counsel for First Union, in form reasonably
satisfactory to BFL, which shall cover the matters contained in
Exhibit D hereto.
6.06. Legal Opinion. First Union shall have received an
opinion, dated the Effective Date, of Cummings & Lockwood,
counsel for BFL and the Bank, in form reasonably satisfactory to
First Union, which shall cover the matters contained in Exhibit
E hereto.
6.07. Officer's Certificate. (i) Each of the
representations and warranties contained herein of First Union,
FUNC-FL and FUNB-FL shall be true and correct as of the date of
this Plan and upon the Effective Date with the same effect as
though all such representations and warranties had been made on
the Effective Date, except for any such representations and
warranties made as of a specified date, which shall be true and
correct as of such date, and (ii) each and all of the agreements
and covenants of First Union, FUNC-FL and FUNB-FL to be performed
and complied with pursuant to this Plan on or prior to the
Effective Date shall have been duly performed and complied with
in all material respects, and BFL and the Bank shall have
received a certificate signed by an executive officer of each of
First Union, FUNC-FL and FUNB-FL dated the Effective Date, to
such effect.
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6.08. Officers' Certificate. (i) Each of the
representations and warranties contained herein of BFL and the
Bank shall be true and correct as of the date of this Plan and
upon the Effective Date with the same effect as though all such
representations and warranties had been made on the Effective
Date, except for any such representations and warranties made as
of a specified date, which shall be true and correct as of such
date and except as otherwise provided in Section 5.11, and (ii)
each and all of the agreements and covenants of BFL and the Bank
to be performed and complied with pursuant to this Plan on or
prior to the Effective Date shall have been duly performed and
complied with in all material respects, and First Union, FUNC-FL
and FUNB-FL shall have received a certificate signed by the Chief
Executive Officers and the Chief Financial Officers of BFL and
the Bank dated the Effective Date, to such effect.
6.09. Effective Registration Statement. The
Registration Statement shall have become effective and no stop
order suspending the effectiveness of the Registration Statement
shall have been issued and no proceedings for that purpose shall
have been initiated or threatened by the SEC or any other
Regulatory Authority.
6.10. Blue-Sky Permits. First Union shall have received
all state securities laws and "blue sky" permits necessary to
consummate the Corporate Merger.
6.11. Tax Opinion. First Union and BFL shall have
received an opinion from Sullivan & Cromwell to the effect that
(i) the Corporate Merger constitutes a reorganization under
Section 368 of the Code, and (ii) no gain or loss will be
recognized by stockholders of BFL who receive shares of First
Union Common Stock in exchange for their shares of BFL Common
Stock and BFL Preferred Stock, except that gain or loss may be
recognized as to cash received in lieu of fractional share
interests, and, in rendering their opinion, Sullivan & Cromwell
may require and rely upon representations contained in
certificates of officers of First Union, BFL and others.
6.12. NYSE Listing. The shares of First Union Common
Stock issuable pursuant to this Plan shall have been approved for
listing on the NYSE, subject to official notice of issuance.
6.13. Receipt of Affiliate Agreements. First Union
shall have received from each affiliate of BFL the agreement
referred to in Section 5.10;
provided, however, that a failure to satisfy any of the
conditions set forth in the proviso following Section 6.02 or in
Section 6.04, 6.06, 6.08 or 6.13 shall only constitute conditions
if asserted by First Union, and a failure to satisfy any of the
conditions set forth in Section 6.05 or 6.07 shall only
33
<PAGE>
constitute conditions if asserted by BFL.
VII. TERMINATION.
This Plan may be terminated prior to the Effective Date,
either before or after receipt of required stockholder approvals:
7.01. Mutual Consent. By the mutual consent of First
Union and BFL, if the Board of Directors of each so determines by
vote of a majority of the members of its entire Board.
7.02. Breach. By First Union or BFL, if its Board of
Directors so determines by vote of a majority of the members of
its entire Board, in the event of (i) a material breach by the
other party of any representation or warranty contained herein,
which breach cannot be or has not been cured within thirty (30)
days after the giving of written notice to the breaching party of
such breach, or (ii) a breach by the other party of any of the
material covenants or agreements contained herein, which breach
cannot be or has not been cured within thirty (30) days after the
giving of written notice to the breaching party of such breach.
7.03. Delay. By First Union or BFL, if its Board of
Directors so determines by vote of a majority of the members of
its entire Board, in the event that the Corporate Merger is not
consummated by December 31, 1994.
7.04. No Stockholder Approval. By BFL or First Union,
if its Board of Directors so determines by a vote of a majority
of the members of its entire Board, in the event that any
stockholder approval contemplated by Section 6.01 is not obtained
at the Meeting, including any adjournment or adjournments
thereof.
VIII. OTHER MATTERS.
8.01. Survival. If the Effective Date occurs, all
representations, warranties, agreements and covenants contained
in this Plan shall not survive the Effective Date. If this Plan
is terminated prior to the Effective Date, the agreements and
representations of the parties in Sections 4.01(P), 4.01(AA) and
4.02(F), Sections 5.03, 5.06(2), 5.12 and 5.13, and Sections
8.01, 8.03, 8.04, 8.05, 8.06, 8.07, 8.09 and 8.11 shall survive
such termination.
8.02. Waiver; Amendment. Prior to the Effective Date,
any provision of this Plan may be (i) waived in writing by the
party benefitted by the provision, or (ii) amended or modified at
any time (including the structure of the transactions
contemplated hereby) by an agreement in writing among the parties
hereto approved by their respective Boards of Directors and
executed in the same manner as this Plan, except that, after the
34
<PAGE>
vote by the stockholders of BFL, the consideration to be received
by the stockholders of BFL for each share of BFL Common Stock and
BFL Preferred Stock shall not thereby be altered in violation of
Section 251 (d) of the Delaware General Corporation Law.
8.03. Counterparts. This Plan may be executed in one or
more counterparts, each of which shall be deemed to constitute an
original. This Plan shall become effective when one counterpart
has been signed by each party hereto.
8.04. Governing Law. This Plan shall be governed by,
and interpreted in accordance with, the laws of the State of
Florida, except as federal law may be applicable.
8.05. Expenses. Each party hereto will bear all
expenses incurred by it in connection with this Plan and the
transactions contemplated hereby, except printing expenses which
shall be shared equally between BFL and First Union.
8.06. Confidentiality. Except as otherwise provided in
Section 5.06(2), each of the parties hereto and their respective
agents, attorneys and accountants will maintain the
confidentiality of all information provided in connection
herewith which has not been publicly disclosed.
8.07. Notices. All notices, requests and other
communications hereunder to a party shall be in writing and shall
be deemed to have been duly given when delivered by hand,
telegram or telex (confirmed in writing) to such party at its
address set forth below or such other address as such party may
specify by notice to the parties hereto.
If to First Union,
FUNC-FL or FUNB-FL, to: First Union Corporation
One First Union Center
Charlotte, N.C. 28288-0013
Attn: Chief Executive Officer
Copy to: Marion A. Cowell, Jr., Esq.
First Union Corporation
One First Union Center
Charlotte, N.C. 28288-0013
If to BFL or the Bank, to: BancFlorida Financial
Corporation
5801 Pelican Bay Boulevard
Naples, Florida 33963
Attn: Rudolf P. Guenzel
Copy to: Paul G. Hughes, Esq.
Cummings & Lockwood
Ten Stamford Forum
35
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P.O. Box 120
Stamford, Connecticut 06904
8.08. Definitions. Any term defined anywhere in this
Plan shall have the meaning ascribed to it for all purposes of
this Plan (unless expressly noted to the contrary). In addition:
(1) the term "Material Adverse Effect", when applied
to a party, shall mean an event, occurrence or circumstance
(including without limitation (i) the making of any
provisions for possible loan and lease losses, write-downs
of other real estate and taxes, and (ii) any breach of a
representation or warranty contained herein by such party)
which (a) has or is reasonably likely to have a material
adverse effect on the financial condition, results of
operations, business or prospects of the party and its
subsidiaries, taken as a whole, or (b) would materially
impair the party's ability to perform its obligations under
this Plan or the Stock Option Agreement or the consummation
of any of the transactions contemplated hereby or thereby;
and
(2) the term "Previously Disclosed" by a party shall
mean information set forth in a Schedule that is delivered
by that party to the other party contemporaneously with the
execution of this Plan and specifically designated as
information "Previously Disclosed" pursuant to this Plan.
8.09. Entire Understanding; No Third Party
Beneficiaries. This Plan and the Stock Option Agreement together
represent the entire understanding of the parties hereto with
reference to the transactions contemplated hereby and thereby
and supersede any and all other oral or written agreements
heretofore made. Nothing in this Plan or the Stock Option
Agreement, expressed or implied, is intended to confer upon any
person, other than the parties hereto or their respective
successors, any rights, remedies, obligations or liabilities
under or by reason of this Plan or the Stock Option Agreement.
8.10. Benefit Plans. Upon consummation of the Corporate
Merger, except as Previously Disclosed in Schedule 8.10, as soon
as administratively practicable, employees of BFL and the BFL
Subsidiaries shall be generally entitled to participate in the
pension, benefit and similar plans on substantially the same
terms and conditions as employees of First Union and its
subsidiaries. For the purpose of determining eligibility to
participate in such plans and the vesting of benefits under such
plans (but not for the accrual of benefits under such plans),
First Union shall give effect to years of service with BFL or the
BFL Subsidiaries, as the case may be, as if such service were
with First Union or its subsidiaries.
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<PAGE>
8.11. Headings. The headings contained in this Plan are
for reference purposes only and are not part of this Plan.
IN WITNESS WHEREOF, the parties hereto have caused this
instrument to be executed in counterparts by their duly
authorized officers, all as of the day and year first above
written.
FIRST UNION CORPORATION
By:/s/ Keith D. Lembo
Name: Keith D. Lembo
Title: Senior Vice President
FIRST UNION CORPORATION OF
FLORIDA
By:/s/ Larry J. Wertz
Name: Larry J. Wertz
Title: Executive Vice President
FIRST UNION NATIONAL BANK OF
FLORIDA
By:/s/ Larry J. Wertz
Name: Larry J. Wertz
Title: Executive Vice President
BANCFLORIDA FINANCIAL CORPORATION
By: /s/ Rudolf P. Guenzel
Name: Rudolf P. Guenzel
Title: President and Chief
Executive Officer
37
<PAGE>
BANCFLORIDA, A FEDERAL SAVINGS
BANK
By: /s/ Rudolf P. Guenzel
Name: Rudolf P. Guenzel
Title: President and Chief
Executive Officer
38
<PAGE>
BOARD OF DIRECTORS
BancFlorida, a Federal Savings Bank
/s/ Gerald A. McHale, Jr.
Gerald A. McHale, Jr.
/s/ Ronnie C. May
Ronnie C. May
/s/ Dale A. Myer
Dale A. Myer
/s/ John J. Agnelli
John J. Agnelli
/s/ Herbert D. Conant
Herbert D. Conant
/s/ J. Michael Holmes
J. Michael Holmes
/s/ Rudolf P. Guenzel
Rudolf P. Guenzel
39
<PAGE>
BOARD OF DIRECTORS
FIRST UNION NATIONAL BANK OF FLORIDA
/s/ Bob D. Allen /s/ John A. Mitchell, III
Bob D. Allen John A. Mitchell, III
/s/ E. Bruce Bower /s/ Ray C. Osborne
E. Bruce Bower Ray C. Osborne
/s/ Alexander W. Dreyfoos, Jr. /s/ H. H. Peyton
Alexander W. Dreyfoos, Jr. H. H. Peyton
/s/ Byron E. Hodnett /s/ William J. Schoen
Byron E. Hodnett William J. Schoen
/s/ Edward W. Lane, III /s/ G. Kennedy Thompson
Edward W. Lane, III G. Kennedy Thompson
/s/ John F. Lowndes /s/ B. J. Walker
John F. Lowndes B. J. Walker
/s/ W. A. McGriff, III /s/ Carol G. Wyllie
W. A. McGriff, III Carol G. Wyllie
40
<PAGE>
LIST OF EXHIBITS
EXHIBIT DESCRIPTION
A STOCK OPTION AGREEMENT
B BFL PREFERRED STOCK AGREEMENT
C AFFILIATE LETTER
D LEGAL OPINION
E LEGAL OPINION
41
Exhibit A
STOCK OPTION AGREEMENT
STOCK OPTION AGREEMENT, dated as of January 17,
1994 (the "Agreement"), by and between BancFlorida Financial
Corporation, a Delaware corporation ("Issuer"), and First
Union Corporation, a North Carolina corporation ("Grantee").
WHEREAS, Grantee and Issuer have entered into an
Agreement and Plan of Mergers dated as of January 17, 1994
(the "Plan"), providing for, among other things, the merger
of Issuer with and into First Union Corporation of Florida
("FUNC-FL"), a wholly-owned subsidiary of Grantee, with
FUNC-FL as the surviving corporation; and
WHEREAS, as a condition and inducement to
Grantee's execution of the Plan, Grantee has required that
Issuer agree, and Issuer has agreed, to grant Grantee the
Option (as defined below);
NOW, THEREFORE, in consideration of the foregoing
and the respective representations, warranties, covenants
and agreements set forth herein and in the Plan, and
intending to be legally bound hereby, Issuer and Grantee
agree as follows:
1. Defined Terms. Capitalized terms which are
used but not defined herein shall have the meanings ascribed
to such terms in the Plan.
2. Grant of Option. Subject to the terms and
conditions set forth herein, Issuer hereby grants to Grantee
an irrevocable option (the "Option") to purchase up to
719,000 shares (as adjusted as set forth herein, the "Option
Shares", which shall include the Option Shares before and
after any transfer of such Option Shares) of common stock,
par value $0.01 per share ("Issuer Common Stock"), of Issuer
at a purchase price per Option Share (the "Purchase Price")
equal to $25.00.
3. Exercise of Option.
(a) Provided that (i) Grantee or Holder (as
defined below), as applicable, shall not be in material
breach of the agreements or covenants contained in this
Agreement or the Plan, and (ii) no preliminary or permanent
injunction or other order against the delivery of shares
covered by the Option issued by any court of competent
jurisdiction in the United States shall be in effect, the
Holder may exercise the Option, in whole or in part, at any
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<PAGE>
time and from time to time following the occurrence of a
Purchase Event; provided that the Option shall terminate and
be of no further force and effect upon the earliest to occur
of (A) the Effective Date, (B) termination of the Plan by
Issuer in accordance with the terms thereof prior to the
occurrence of a Purchase Event or a Preliminary Purchase
Event unless the Issuer has, after the date hereof, engaged
in discussions with any third party regarding an Acquisition
Transaction (as hereinafter defined) (an "Issuer
Termination"), (C) 18 months after the termination of the
Plan by Issuer in accordance with the terms thereof other
than pursuant to an Issuer Termination, and (D) 18 months
after the termination of the Plan by Grantee in accordance
with the terms thereof; provided, however, that any purchase
of shares upon exercise of the Option shall be subject to
compliance with applicable law, including, without
limitation, the Bank Holding Company Act of 1956, as amended
(the "BHC Act"). The term "Holder" shall mean the holder
or holders of the Option from time to time, and which
initially is Grantee.
(b) As used herein, a "Purchase Event" means
any of the following events:
(i) Without Grantee's prior written
consent, Issuer shall have authorized, recommended,
publicly proposed or publicly announced an intention to
authorize, recommend or propose, or entered into an
agreement with any person (other than Grantee or any
subsidiary of Grantee) to effect an Acquisition
Transaction. As used herein, the term "Acquisition
Transaction" shall mean (A) a merger, consolidation or
similar transaction involving Issuer or any of its
significant subsidiaries, (B) the disposition, by sale,
lease, exchange or otherwise, of assets or deposits of
Issuer or any of its significant subsidiaries
representing in either case 20% or more of the
consolidated assets or deposits of Issuer and its
subsidiaries or (C) the issuance, sale or other
disposition of (including by way of merger,
consolidation, share exchange or any similar
transaction) securities representing 20% or more of
the voting power of Issuer or any of its significant
subsidiaries other than the issuance of Issuer Common
Stock upon the exercise of outstanding options or the
conversion of outstanding convertible securities of
Issuer; or
(ii) any person (other than Grantee or
any subsidiary of Grantee) shall have acquired
beneficial ownership (as such term is defined in Rule
13d-3 promulgated under the Exchange Act) of or the
A-2
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right to acquire beneficial ownership of, or any
"group" (as such term is defined under the Exchange
Act) shall have been formed which beneficially owns or
has the right to acquire beneficial ownership of, 15%
or more (or if such person or group is the beneficial
owner of 15% or more on the date hereof such person or
group acquires an additional 5% or more) of the voting
power of Issuer or any of its significant subsidiaries.
(c) As used herein, a "Preliminary Purchase
Event" means any of the following events:
(i) any person (other than Grantee or any
subsidiary of Grantee) shall have commenced (as such
term is defined in Rule 14d-2 under the Exchange Act)
or shall have filed a registration statement under the
Securities Act, with respect to, a tender offer or
exchange offer to purchase any shares of Issuer Common
Stock such that, upon consummation of such offer, such
person would own or control 20% or more of the then
outstanding shares of Issuer Common Stock (such an
offer being referred to herein as a "Tender Offer" or
an "Exchange Offer," respectively); or
(ii) the holders of Issuer Common Stock
shall not have approved the Plan at the Meeting, the
Meeting shall not have been held or shall have been
canceled prior to termination of the Plan, or Issuer's
Board of Directors shall have withdrawn or modified in
a manner adverse to Grantee the recommendation of
Issuer's Board of Directors with respect to the Plan,
in each case after it shall have been publicly
announced that any person (other than Grantee or any
subsidiary of Grantee) shall have (A) made a proposal
to engage in an Acquisition Transaction, (B) commenced
a Tender Offer or filed a registration statement under
the Securities Act with respect to an Exchange Offer or
(C) filed an application (or given a notice), whether
in draft or final form, under the BHC Act, the Bank
Merger Act or the Change in Bank Control Act of 1978,
for approval to engage in an Acquisition Transaction;
or
(iii) any person, other than Grantee or any
subsidiary of Grantee, shall have made a bona fide
proposal to Issuer or its stockholders by public
announcement, or written communication that is or
becomes the subject of public disclosure, to engage in
an Acquisition Transaction; or
(iv) after a proposal is made by a third
party to Issuer or its stockholders to engage in an
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Acquisition Transaction, Issuer shall have breached any
covenant or obligation contained in the Plan and such
breach would entitle Grantee to terminate the Plan
under Section 7.02 of Article VII thereof (without
regard to the cure period provided for therein unless
such cure is promptly effected without jeopardizing
consummation of the Mergers pursuant to the terms of
the Plan); or
(v) any person, other than Grantee or any
subsidiary of Grantee, other than in connection with a
transaction to which Grantee has given its prior
written consent, shall have filed an application or
notice with the Board of Governors of the Federal
Reserve System (the "Federal Reserve Board"), or other
federal or state bank regulatory authority, for
approval to engage in an Acquisition Transaction.
As used in this Agreement, "person" shall have the meaning
specified in Sections 3(a)(9) and 13(d)(3) of the Exchange
Act.
(d) Issuer shall notify Grantee promptly in
writing of the occurrence of any Preliminary Purchase Event
or Purchase Event (in either case, a "Triggering Event"), it
being understood that the giving of such notice by Issuer
shall not be a condition to the right of Holder to exercise
the Option.
(e) In the event Holder wishes to exercise
the Option, it shall send to Issuer a written notice (the
date of which being herein referred to as the "Notice Date")
specifying (i) the total number of Option Shares it intends
to purchase pursuant to such exercise and (ii) a place and
date not earlier than three business days nor later than 15
business days from the Notice Date for the closing (the
"Closing") of such purchase (the "Closing Date"); provided,
however, if any required application for listing such shares
on the New York Stock Exchange has not been approved by the
date so specified such date shall be extended for a period
not to exceed 21 days from the Notice Date. If prior
notification to or approval of the Federal Reserve Board or
any other regulatory authority is required in connection
with such purchase, Issuer shall cooperate with the Holder
in the filing of the required notice of application for
approval and the obtaining of such approval and the Closing
shall occur immediately following such regulatory approvals
(and any mandatory waiting periods). Any exercise of the
Option shall be deemed to occur on the Notice Date relating
thereto.
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4. Payment and Delivery of Certificates.
(a) On each Closing Date, Holder shall (i)
pay to Issuer, in immediately available funds by wire
transfer to a bank account designated by Issuer, an amount
equal to the Purchase Price multiplied by the number of
Option Shares to be purchased on such Closing Date, and (ii)
present and surrender this Agreement to the Issuer at the
address of the Issuer specified in subsection (f) of Section
11 hereof.
(b) At each Closing, simultaneously with the
delivery of immediately available funds and surrender of
this Agreement as provided in subsection (a) of this Section
4, (i) Issuer shall deliver to Holder (A) a certificate or
certificates representing the Option Shares to be purchased
at such Closing, which Option Shares shall be free and clear
of all liens, claims, charges and encumbrances of any kind
whatsoever and subject to no preemptive rights, and (B) if
the Option is exercised in part only, an executed new
agreement with the same terms as this Agreement evidencing
the right to purchase the balance of the shares of Issuer
Common Stock purchasable hereunder, and (ii) Holder shall
deliver to Issuer a letter agreeing that Holder shall not
offer to sell or otherwise dispose of such Option Shares in
violation of applicable federal and state law or of the
provisions of this Agreement.
(c) In addition to any other legend that is
required by applicable law, certificates for the Option
Shares delivered at each Closing shall be endorsed with a
restrictive legend which shall read substantially as
follows:
THE TRANSFER OF THE STOCK REPRESENTED BY THIS CERTIFICATE IS
SUBJECT TO RESTRICTIONS ARISING UNDER THE SECURITIES ACT OF
1933, AS AMENDED, AND PURSUANT TO THE TERMS OF A STOCK
OPTION AGREEMENT DATED AS OF JANUARY 17, 1994. A COPY OF
SUCH AGREEMENT WILL BE PROVIDED TO THE HOLDER HEREOF WITHOUT
CHARGE UPON RECEIPT BY THE ISSUER OF A WRITTEN REQUEST
THEREFOR.
It is understood and agreed that the above legend shall be
removed by delivery of substitute certificate(s) without
such legend if Holder shall have delivered to Issuer a copy
of a letter from the staff of the SEC, or an opinion of
counsel in form and substance reasonably satisfactory to
Issuer and its counsel, to the effect that such legend is
not required for purposes of the Securities Act.
(d) Upon the giving by Holder to Issuer of
the written notice of exercise of the Option provided for
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under Section 3(e), the tender of the applicable purchase
price in immediately available funds and the tender of this
Agreement to Issuer, Holder shall be deemed to be the holder
of record of the shares of Issuer Common Stock issuable upon
such exercise, notwithstanding that the stock transfer books
of Issuer shall then be closed or that certificates
representing such shares of Issuer Common Stock shall not
then be actually delivered to Holder. Issuer shall pay all
expenses, and any and all United States federal, state, and
local taxes and other charges that may be payable in
connection with the preparation, issuance and delivery of
stock certificates under this Section in the name of Holder
or its assignee, transferee, or designee.
(e) Issuer agrees (i) that it shall at all
times maintain, free from preemptive rights, sufficient
authorized but unissued or treasury shares of Issuer Common
Stock so that the Option may be exercised without additional
authorization of Issuer Common Stock after giving effect to
all other options, warrants, convertible securities and
other rights to purchase Issuer Common Stock, (ii) that it
will not, by charter amendment or through reorganization,
consolidation, merger, dissolution or sale of assets, or by
any other voluntary act, avoid or seek to avoid the
observance or performance of any of the covenants,
stipulations or conditions to be observed or performed
hereunder by Issuer, (iii) promptly to take all action as
may from time to time be required (including (A) complying
with all premerger notification, reporting and waiting
period requirements specified in 15 U.S.C. (section mark) 18a
and regulations promulgated thereunder and (B) in the event,
under the BHC Act, or the Change in Bank Control Act of
1978, as amended, or a state banking law, prior approval of
or notice to the Federal Reserve Board or to any state
regulatory authority is necessary before the Option may be
exercised, cooperating fully with Holder in preparing such
applications or notices and providing such information to
the Federal Reserve Board or such state regulatory authority
as they may require) in order to permit Holder to exercise
the Option and Issuer duly and effectively to issue shares
of the Issuer Common Stock pursuant hereto, and (iv)
promptly to take all action provided herein to protect the
rights of Holder against dilution.
5. Representations and Warranties of Issuer.
Issuer hereby represents and warrants to Grantee (and
Holder, if different than Grantee) as follows:
(a) Due Authorization. Issuer has all
requisite corporate power and authority to enter into this
Agreement and, subject to any approvals or consents referred
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to herein, to consummate the transactions contemplated
hereby. The execution and delivery of this Agreement and
the consummation of the transactions contemplated hereby
have been duly authorized by all necessary corporate action
on the part of Issuer. This Agreement has been duly
executed and delivered by Issuer.
(b) Authorized Stock. Issuer has taken all
necessary corporate and other action to authorize and
reserve and to permit it to issue, and, at all times from
the date hereof until the obligation to deliver Issuer
Common Stock upon the exercise of the Option terminates,
will have reserved for issuance, upon exercise of the
Option, the number of shares of Issuer Common Stock
necessary for Holder to exercise the Option, and Issuer will
take all necessary corporate action to authorize and reserve
for issuance all additional shares of Issuer Common Stock or
other securities which may be issued pursuant to Section 7
upon exercise of the Option. The shares of Issuer Common
Stock to be issued upon due exercise of the Option,
including all additional shares of Issuer Common Stock or
other securities which may be issuable pursuant to Section
7, upon issuance pursuant hereto, shall be duly and validly
issued, fully paid and nonassessable, and shall be delivered
free and clear of all liens, claims, charges and
encumbrances of any kind or nature whatsoever, including any
preemptive rights of any stockholder of Issuer.
6. Representations and Warranties of Grantee.
Grantee hereby represents and warrants to Issuer that:
(a) Due Authorization. Grantee has all
requisite corporate power and authority to enter into this
Agreement and, subject to any approvals or consents referred
to herein, to consummate the transactions contemplated
hereby. The execution and delivery of this Agreement and
the consummation of the transactions contemplated hereby
have been duly authorized by all necessary corporate action
on the part of Grantee. This Agreement has been duly
executed and delivered by Grantee.
(b) Purchase Not for Distribution. This
Option is not being, and any Option Shares or other
securities acquired by Grantee upon exercise of the Option
will not be, acquired with a view to the public distribution
thereof and will not be transferred or otherwise disposed of
except in a transaction registered or exempt from
registration under the Securities Act.
7. Adjustment upon Changes in Issuer
Capitalization, etc.
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(a) In the event of any change in Issuer
Common Stock by reason of a stock dividend, stock split,
split-up, recapitalization, combination, exchange of shares
or similar transaction, the type and number of shares or
securities subject to the Option, and the Purchase Price
therefor, shall be adjusted appropriately, and proper
provision shall be made in the agreements governing such
transaction so that Holder shall receive, upon exercise of
the Option, the number and class of shares or other
securities or property that Holder would have received in
respect of Issuer Common Stock if the Option had been
exercised immediately prior to such event, or the record
date therefor, as applicable. If any additional shares of
Issuer Common Stock are issued after the date of this
Agreement (other than pursuant to an event described in the
first sentence of this subsection (a), upon exercise of any
option to purchase Issuer Common Stock outstanding on the
date hereof or upon conversion into Issuer Common Stock of
any convertible security of Issuer outstanding on the date
hereof), the number of shares of Issuer Common Stock subject
to the Option shall be adjusted so that, after such
issuance, it, together with any shares of Issuer Common
Stock previously issued pursuant hereto, equals 19.9% of
the number of shares of Issuer Common Stock then issued and
outstanding, without giving effect to any shares subject to
or issued pursuant to the Option. No provision of this
Section 7 shall be deemed to affect or change, or constitute
authorization for any violation of, any of the covenants or
representations in the Plan.
(b) In the event that Issuer shall enter in
an agreement (i) to consolidate with or merge into any
person, other than Grantee or one of its subsidiaries, and
shall not be the continuing or surviving corporation of such
consolidation or merger, (ii) to permit any person, other
than Grantee or one of its subsidiaries, to merge into
Issuer and Issuer shall be the continuing or surviving
corporation, but, in connection with such merger, the then
outstanding shares of Issuer Common Stock shall be changed
into or exchanged for stock or other securities of Issuer or
any other person or cash or any other property or the
outstanding shares of Issuer Common Stock immediately prior
to such merger shall after such merger represent less than
50% of the outstanding shares and share equivalents of the
merged company, or (iii) to sell or otherwise transfer all
or substantially all of its assets to any person, other than
Grantee or one of its subsidiaries, then, and in each such
case, the agreement governing such transaction shall make
proper provisions so that the Option shall, upon the
consummation of any such transaction and upon the terms and
conditions set forth herein, be converted into, or exchanged
for, an option (the "Substitute Option"), at the election of
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Holder, of either (x) the Acquiring Corporation (as
hereinafter defined), (y) any person that controls the
Acquiring Corporation, or (z) in the case of a merger
described in clause (ii), Issuer (such person being referred
to as "Substitute Option Issuer").
(c) The Substitute Option shall have the
same terms as the Option, provided, that, if the terms of
the Substitute Option cannot, for legal reasons, be the same
as the Option, such terms shall be as similar as possible
and in no event less advantageous to Holder. Substitute
Option Issuer shall also enter into an agreement with Holder
in substantially the same form as this Agreement, which
shall be applicable to the Substitute Option.
(d) The Substitute Option shall be
exercisable for such number of shares of Substitute Common
Stock (as hereinafter defined) as is equal to the Assigned
Value (as hereinafter defined) multiplied by the number of
shares of Issuer Common Stock for which the Option was
theretofore exercisable, divided by the Average Price (as
hereinafter defined). The exercise price of Substitute
Option per share of Substitute Common Stock (the "Substitute
Option Price") shall then be equal to the Option Price
multiplied by a fraction in which the numerator is the
number of shares of Issuer Common Stock for which the Option
was theretofore exercisable and the denominator is the
number of shares of the Substitute Common Stock for which
the Substitute Option is exercisable.
(e) The following terms have the meanings
indicated:
(1) "Acquiring Corporation" shall mean (i) the
continuing or surviving corporation of a consolidation
or merger with Issuer (if other than Issuer), (ii)
Issuer in a merger in which Issuer is the continuing or
surviving person, or (iii) the transferee of all or
substantially all of Issuer's assets (or a substantial
part of the assets of its subsidiaries taken as a
whole).
(2) "Substitute Common Stock" shall mean the
common stock issued by Substitute Option Issuer upon
exercise of the Substitute Option.
(3) "Assigned Value" shall mean the highest of
(x) the price per share of Issuer Common Stock at which
a Tender Offer or an Exchange Offer therefor has been
made, (y) the price per share of Issuer Common Stock to
be paid by any third party pursuant to an agreement
with Issuer, and (z) the highest closing price for
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shares of Issue Common Stock within the six-month
period immediately preceding the consolidation, merger,
or sale in question . In the event that a Tender Offer
or an Exchange Offer is made for Issuer Common Stock or
an agreement is entered into for a merger or
consolidation involving consideration other than cash,
the value of the securities or other property issuable
or deliverable in exchange for Issuer Common Stock
shall be determined by a nationally recognized
investment banking firm selected by Holder or Owner, as
the case may be (and if there are both a Holder and an
Owner, the Holder).
(4) "Average Price" shall mean the average
closing price of a share of Substitute Common Stock for
the one year immediately preceding the consolidation,
merger, or sale in question, but in no event higher
than the closing price of the shares of Substitute
Common Stock on the day preceding such consolidation,
merger or sale; provided that if Issuer is the issuer
of the Substitute Option, the Average Price shall be
computed with respect to a share of common stock issued
by Issuer, the person merging into Issuer or by any
company which controls such person, as Holder may
elect.
(f) In no event, pursuant to any of the
foregoing paragraphs, shall the Substitute Option be
exercisable for more than 19.9% of the aggregate of the
shares of Substitute Common Stock outstanding prior to
exercise of the Substitute Option. In the event that the
Substitute Option would be exercisable for more than 19.9%
of the aggregate of the shares of Substitute Common Stock
but for the limitation in the first sentence of this
subsection (f), Substitute Option Issuer shall make a cash
payment to Holder equal to the excess of (i) the value of
the Substitute Option without giving effect to the
limitation in the first sentence of this subsection (f) over
(ii) the value of the Substitute Option after giving effect
to the limitation in the first sentence of this subsection
(f). This difference in value shall be determined by a
nationally-recognized investment banking firm selected by
Holder.
(g) Issuer shall not enter into any
transaction described in subsection (b) of this Section 7
unless the Acquiring Corporation and any person that
controls the Acquiring Corporation assume in writing all the
obligations of Issuer hereunder and take all other actions
that may be necessary so that the provisions of this Section
7 are given full force and effect (including, without
limitation, any action that may be necessary so that the
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holders of the other shares of common stock issued by
Substitute Option Issuer are not entitled to exercise any
rights by reason of the issuance or exercise of the
Substitute Option and the shares of Substitute Common Stock
are otherwise in no way distinguishable from or have lesser
economic value (other than any dimunition in value resulting
from the fact that the Substitute Common Stock are
restricted securities, as defined in Rule 144 under the
Securities Act) than other shares of common stock issued by
Substitute Option Issuer).
8. Registration Rights.
(a) Demand Registration Rights. Issuer
shall, subject to the conditions of subparagraph (c) below,
if requested by any Holder or Owner, as applicable,
including Grantee and any permitted transferee ("Selling
Shareholder"), as expeditiously as possible prepare and file
a registration statement under the Securities Act if such
registration is necessary in order to permit the sale or
other disposition of any or all shares of Issuer Common
Stock or other securities that have been acquired by or are
issuable to the Selling Shareholder upon exercise of the
Option in accordance with the intended method of sale or
other disposition stated by the Selling Shareholder in such
request, including without limitation a "shelf" registration
statement under Rule 415 under the Securities Act or any
successor provision, and Issuer shall use its best efforts
to qualify such shares or other securities for sale under
any applicable state securities laws.
(b) Additional Registration Rights. If
Issuer at any time after the exercise of the Option proposes
to register any shares of Issuer Common Stock under the
Securities Act in connection with an underwritten public
offering of such Issuer Common Stock, Issuer will promptly
give written notice to the Selling Shareholders of its
intention to do so and, upon the written request of any
Selling Shareholder given within 30 days after receipt of
any such notice (which request shall specify the number of
shares of Issuer Common Stock intended to be included in
such underwritten public offering by the Selling
Shareholder), Issuer will cause all such shares for which a
Selling Shareholder requests participation in such
registration, to be so registered and included in such
underwritten public offering; provided, however, that Issuer
may elect to not cause any such shares to be so registered
(i) if the underwriters in good faith object for valid
business reasons, or (ii) in the case of a registration
solely to implement an employee benefit plan or a
registration filed on Form S-4; provided, further, however,
that such election pursuant to (i) may only be made two
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times. If some but not all the shares of Issuer Common
Stock, with respect to which Issuer shall have received
requests for registration pursuant to this subsection (b),
shall be excluded from such registration, Issuer shall make
appropriate allocation of shares to be registered among the
Selling Shareholders desiring to register their shares pro
rata in the proportion that the number of shares requested
to be registered by each such Selling Shareholder bears to
the total number of shares requested to be registered by all
such Selling Shareholders then desiring to have Issuer
Common Stock registered for sale.
(c) Conditions to Required Registration.
Issuer shall use all reasonable efforts to cause each
registration statement referred to in subparagraph (a) above
to become effective and to obtain all consents or waivers of
other parties which are required therefor and to keep such
registration statement effective, provided, however, that
Issuer may delay any registration of Option Shares required
pursuant to subparagraph (a) above for a period not
exceeding 90 days provided Issuer shall in good faith
determine that any such registration would adversely affect
an offering or contemplated offering of other securities by
Issuer, and Issuer shall not be required to register Option
Shares under the Securities Act pursuant to subsection (a)
above:
(i) prior to the earliest of (a)
termination of the Plan pursuant to Article VII thereof, (b)
failure to obtain the requisite stockholder approval
pursuant to Section 6.01 of Article VI of the Plan, and (c)
a Purchase Event or a Preliminary Purchase Event;
(ii) on more than one occasion;
(iii) more than once during any
calendar year;
(iv) within 90 days after the effective
date of a registration referred to in subsection (b) above
pursuant to which the Selling Shareholder or Selling
Shareholders concerned were afforded the opportunity to
register such shares under the Securities Act and such
shares were registered as requested; and
(v) unless a request therefor is made
to Issuer by Selling Shareholders that hold at least 25% or
more of the aggregate number of Option Shares (including
shares of Issuer Common Stock issuable upon exercise of the
Option) then outstanding.
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In addition to the foregoing, Issuer shall
not be required to maintain the effectiveness of any
registration statement after the expiration of nine months
from the effective date of such registration statement.
Issuer shall use all reasonable efforts to make any filings,
and take all steps, under all applicable state securities
laws to the extent necessary to permit the sale or other
disposition of the Option Shares so registered in accordance
with the intended method of distribution for such shares,
provided, however, that Issuer shall not be required to
consent to general jurisdiction or qualify to do business in
any state where it is not otherwise required to so consent
to such jurisdiction or to so qualify to do business.
(d) Expenses. Except where applicable state
law prohibits such payments, Issuer will pay all expenses
(including without limitation registration fees,
qualification fees, blue sky fees and expenses (including
the fees and expenses of counsel), legal expenses, including
the reasonable fees and expenses of one counsel to the
holders whose Option Shares are being registered, printing
expenses and the costs of special audits or "cold comfort"
letters, expenses of underwriters, excluding discounts and
commissions but including liability insurance if Issuer so
desires or the underwriters so require, and the reasonable
fees and expenses of any necessary special experts) in
connection with each registration pursuant to subsection (a)
or (b) above (including the related offerings and sales by
holders of Option Shares) and all other qualifications,
notifications or exemptions pursuant to subsection (a) or
(b) above.
(e) Indemnification. In connection with any
registration under subparagraph (a) or (b) above Issuer
hereby indemnifies the Selling Shareholders, and each
underwriter thereof, including each person, if any, who
controls such holder or underwriter within the meaning of
Section 15 of the Securities Act, against all expenses,
losses, claims, damages and liabilities caused by any
untrue, or alleged untrue, statement of a material fact
contained in any registration statement or prospectus or
notification or offering circular (including any amendments
or supplements thereto) or any preliminary prospectus, or
caused by any omission, or alleged omission, to state
therein a material fact required to be stated therein or
necessary to make the statements therein not misleading,
except insofar as such expenses, losses, claims, damages or
liabilities of such indemnified party are caused by any
untrue statement or alleged untrue statement that was
included by Issuer in any such registration statement or
prospectus or notification or offering circular (including
any amendments or supplements thereto) in reliance upon and
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in conformity with, information furnished in writing to
Issuer by such indemnified party expressly for use therein,
and Issuer and each officer, director and controlling person
of Issuer shall be indemnified by such Selling Shareholders,
or by such underwriter, as the case may be, for all such
expenses, losses, claims, damages and liabilities caused by
any untrue, or alleged untrue, statement, that was included
by Issuer in any such registration statement or prospectus
or notification or offering circular (including any
amendments or supplements thereto) in reliance upon, and in
conformity with, information furnished in writing to Issuer
by such holder or such underwriter, as the case may be,
expressly for such use.
Promptly upon receipt by a party indemnified
under this subsection (e) of notice of the commencement of
any action against such indemnified party in respect of
which indemnity or reimbursement may be sought against any
indemnifying party under this subsection (e), such
indemnified party shall notify the indemnifying party in
writing of the commencement of such action, but the failure
so to notify the indemnifying party shall not relieve it of
any liability which it may otherwise have to any indemnified
party under this subsection (e). In case notice of
commencement of any such action shall be given to the
indemnifying party as above provided, the indemnifying party
shall be entitled to participate in and, to the extent it
may wish, jointly with any other indemnifying party
similarly notified, to assume the defense of such action at
its own expense, with counsel chosen by it and satisfactory
to such indemnified party. The indemnified party shall have
the right to employ separate counsel in any such action and
participate in the defense thereof, but the fees and
expenses of such counsel (other than reasonable costs of
investigation) shall be paid by the indemnified party unless
(i) the indemnifying party either agrees to pay the same,
(ii) the indemnifying party fails to assume the defense of
such action with counsel satisfactory to the indemnified
party, or (iii) the indemnified party has been advised by
counsel that one or more legal defenses may be available to
the indemnifying party that may be contrary to the interest
of the indemnified party, in which case the indemnifying
party shall be entitled to assume the defense of such action
notwithstanding its obligation to bear fees and expenses of
such counsel. No indemnifying party shall be liable for any
settlement entered into without its consent, which consent
may not be unreasonably withheld.
If the indemnification provided for in this
subsection (e) is unavailable to a party otherwise entitled
to be indemnified in respect of any expenses, losses,
claims, damages or liabilities referred to herein, then the
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indemnifying party, in lieu of indemnifying such party
otherwise entitled to be indemnified, shall contribute to
the amount paid or payable by such party to be indemnified
as a result of such expenses, losses, claims, damages or
liabilities in such proportion as is appropriate to reflect
the relative benefits received by Issuer, the Selling
Shareholders and the underwriters from the offering of the
securities and also the relative fault of Issuer, the
Selling Shareholders and the underwriters in connection with
the statements or omissions which resulted in such expenses,
losses, claims, damages or liabilities, as well as any other
relevant equitable considerations. The amount paid or
payable by a party as a result of the expenses, losses,
claims, damages and liabilities referred to above shall be
deemed to include any legal or other fees or expenses
reasonably incurred by such party in connection with
investigating or defending any action or claim; provided,
however, that in no case shall any Selling Shareholder be
responsible, in the aggregate, for any amount in excess of
the net offering proceeds attributable to its Option Shares
included in the offering. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent
misrepresentation. Any obligation by any holder to
indemnify shall be several and not joint with other holders.
In connection with any registration pursuant
to subsection (a) or (b) above, Issuer and each Selling
Shareholder (other than Grantee) shall enter into an
agreement containing the indemnification provisions of this
subsection (e).
(f) Miscellaneous Reporting. Issuer shall
comply with all reporting requirements and will do all such
other things as may be necessary to permit the expeditious
sale at any time of any Option Shares by the Selling
Shareholders thereof in accordance with and to the extent
permitted by any rule or regulation promulgated by the SEC
from time to time, including, without limitation, Rule 144A.
Issuer shall at its expense provide the Selling Shareholders
with any information necessary in connection with the
completion and filing of any reports or forms required to be
filed by them under the Securities Act or the Exchange Act,
or required pursuant to any state securities laws or the
rules of any stock exchange.
(g) Issue Taxes. Issuer will pay all stamp
taxes in connection with the issuance and the sale of the
Option Shares and in connection with the exercise of the
Option, and will save the Selling Shareholders harmless,
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without limitation as to time, against any and all
liabilities, with respect to all such taxes.
9. Quotation; Listing. If Issuer Common Stock
or any other securities to be acquired in connection with
the exercise of the Option are then authorized for
quotation or trading or listing on the NASDAQ/NMS or any
securities exchange, Issuer, upon the request of Holder,
will promptly file an application, if required, to authorize
for quotation or trading or listing the shares of Issuer
Common Stock or other securities to be acquired upon
exercise of the Option on the NASDAQ/NMS or such other
securities exchange and will use its best efforts to obtain
approval, if required, of such quotation or listing as soon
as practicable.
10. Division of Option. This Agreement (and the
Option granted hereby) are exchangeable, without expense, at
the option of Holder, upon presentation and surrender of
this Agreement at the principal office of Issuer for other
Agreements providing for Options of different denominations
entitling the holder thereof to purchase in the aggregate
the same number of shares of Issuer Common Stock purchasable
hereunder. The terms "Agreement" and "Option" as used
herein include any other Agreements and related Options for
which this Agreement (and the Option granted hereby) may be
exchanged. Upon receipt by Issuer of evidence reasonably
satisfactory to it of the loss, theft, destruction or
mutilation of this Agreement, and (in the case of loss,
theft or destruction) of reasonably satisfactory
indemnification, and upon surrender and cancellation of this
Agreement, if mutilated, Issuer will execute and deliver a
new Agreement of like tenor and date. Any such new
Agreement executed and delivered shall constitute an
additional contractual obligation on the part of Issuer,
whether or not the Agreement so lost, stolen, destroyed or
mutilated shall at any time be enforceable by anyone.
11. Miscellaneous.
(a) Expenses. Each of the parties hereto
shall bear and pay all costs and expenses incurred by it or
on its behalf in connection with the transactions
contemplated hereunder, including fees and expenses of its
own financial consultants, investment bankers, accountants
and counsel.
(b) Waiver and Amendment. Any provision of
this Agreement may be waived at any time by the party that
is entitled to the benefits of such provision. This
Agreement may not be modified, amended, altered or
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supplemented except upon the execution and delivery of a
written agreement executed by the parties hereto.
(c) Entire Agreement: No Third-Party
Beneficiary; Severability. This Agreement, together with
the Plan and the other documents and instruments referred to
herein and therein, between Grantee and Issuer (a)
constitutes the entire agreement and supersedes all prior
agreements and understandings, both written and oral,
between the parties with respect to the subject matter
hereof and (b) is not intended to confer upon any person
other than the parties hereto (other than any transferees of
the Option Shares or any permitted transferee of this
Agreement pursuant to subsection (h) of this Section 14) any
rights or remedies hereunder. If any term, provision,
covenant or restriction of this Agreement is held by a court
of competent jurisdiction or a federal or state regulatory
agency to be invalid, void or unenforceable, the remainder
of the terms, provisions, covenants and restrictions of this
Agreement shall remain in full force and effect and shall in
no way be affected, impaired or invalidated. If for any
reason such court or regulatory agency determines that the
Option does not permit Holder or Owner to acquire, or does
not require Issuer to repurchase, the full number of shares
of Issuer Common Stock as provided in Section 3(as adjusted
pursuant to Section 7), it is the express intention of
Issuer to allow Holder or Owner to acquire or to require
Issuer to repurchase such lesser number of shares as may be
permissible without any amendment or modification hereof.
(d) Governing Law. This Agreement shall be
governed and construed in accordance with the laws of the
State of Florida without regard to any applicable conflicts
of law rules.
(e) Descriptive Headings. The descriptive
headings contained herein are for convenience of reference
only and shall not affect in any way the meaning or
interpretation of this Agreement.
(f) Notices. All notices and other
communications hereunder shall be in writing and shall be
deemed given if delivered personally, telecopied (with
confirmation) or mailed by registered or certified mail
(return receipt requested) to the parties at the following
addresses (or at such other address for a party as shall be
specified by like notice):
If to Issuer to: BancFlorida Financial Corporation
5801 Pelican Bay Boulevard
Naples, Florida 33963
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Telecopy Number: (813) 591-7896
Attention: Rudolf P. Guenzel
President and Chief Executive
Officer
with a copy to: Cummings & Lockwood
Ten Stamford Forum
P.O. Box 120
Stamford, Connecticut 06904
Telecopy Number: (203) 351-4359
Attention: Paul G. Hughes
If to Grantee to: First Union Corporation
One First Union Center
Charlotte, North Carolina 28288-0013
Telecopy Number: (704) 374-3425
Attention: Edward E. Crutchfield, Jr.
Chairman and Chief Executive Officer
with a copy to: First Union Corporation
One First Union Center
Charlotte, North Carolina 28288-0013
Telecopy Number: (704) 374-3425
Attention: Marion A. Cowell, Jr.
General Counsel
(g) Counterparts. This Agreement and any
amendments hereto may be executed in two counterparts, each
of which shall be considered one and the same agreement and
shall become effective when both counterparts have been
signed, it being understood that both parties need not sign
the same counterpart.
(h) Assignment. Neither this Agreement nor
any of the rights, interests or obligations hereunder or
under the Option shall be assigned by any of the parties
hereto (whether by operation of law or otherwise) without
the prior written consent of the other party, except that
Holder may assign this Agreement to a wholly-owned
subsidiary of Holder and Holder may assign its rights
hereunder in whole or in part after the occurrence of a
Purchase Event. Subject to the preceding sentence, this
Agreement shall be binding upon, inure to the benefit of and
be enforceable by the parties and their respective
successors and assigns.
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(i) Further Assurances. In the event of any
exercise of the Option by the Holder, Issuer and the Holder
shall execute and deliver all other documents and
instruments and take all other action that may be reasonably
necessary in order to consummate the transactions provided
for by such exercise.
(j) Specific Performance. The parties
hereto agree that this Agreement may be enforced by either
party through specific performance, injunctive relief and
other equitable relief. Both parties further agree to waive
any requirement for the securing or posting of any bond in
connection with the obtaining of any such equitable relief
and that this provision is without prejudice to any other
rights that the parties hereto may have for any failure to
perform this Agreement.
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IN WITNESS WHEREOF, Issuer and Grantee have caused
this Stock Option Agreement to be signed by their respective
officers thereunto duly authorized, all as of the day and
year first written above.
BANCFLORIDA FINANCIAL CORPORATION
By: /s/ Rudolf P. Guenzel
Name: Rudolf P. Guenzel
Title: President and Chief
Executive Officer
FIRST UNION CORPORATION
By: /s/ Keith D. Lembo
Name: Keith D. Lembo
Title: Senior Vice President
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<PAGE>
Exhibit B
AGREEMENT, dated as of January 17, 1994, by and between
William R. Berkley (the "Holder"), BancFlorida Financial
Corporation ("BancFlorida") and First Union Corporation ("First
Union").
WHEREAS, the Holder is the owner of 1,138,000 shares of
Cumulative Convertible Preferred Stock of BancFlorida(the
"Preferred Shares"), representing all the issued and outstanding
shares of such preferred stock;
WHEREAS, First Union and BancFlorida are prepared to enter
into an Agreement and Plan of Mergers (the "Plan") dated as of
the date hereof;
WHEREAS, in order to induce First Union to enter into the
Plan, the Holder and BancFlorida have agreed to enter into this
Agreement;
NOW, THEREFORE, in consideration of the premises herein
contained and other good and valuable consideration, the parties
hereto agree as follows:
1. The Holder shall vote all the Preferred Shares (and any
common shares of BancFlorida into which Preferred Shares have
been converted ("Converted Common Shares")) in favor of the Plan
and the transactions contemplated thereby at the meeting of
stockholders of BancFlorida called for that purpose.
2. The Holder agrees that it will accept the consideration
provided for in the Plan in exchange for the Preferred Shares as
provided in Section 2.01 of the Plan.
3. The Holder agrees that the Plan and Stock Option
Agreement dated as of the date hereof between First Union and
BancFlorida will not result in any change in the conversion price
for the Preferred Shares. BancFlorida and First Union agree that
no amendment will be made to the Plan or the Stock Option
Agreement referred to below which would result in any change to
the conversion price for the Preferred Shares.
4. Except as set forth below in paragraph 7 of this
Agreement, the Holder agrees that it will not sell or transfer
any Preferred Shares to any other party unless such party enters
into an agreement, satisfactory to First Union, to abide by all
the terms of this Agreement as if such party were the Holder.
Nothing provided herein shall prevent the Holder from selling any
Converted Common Shares, except that Holder agrees that Holder
will not sell or transfer any Converted Common Shares to any
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person or entity who or which has made a proposal to engage in an
Acquisition Transaction (as defined in the Stock Option Agreement
referred to above) or to any person or entity acting in concert
with or on behalf of such first person or entity.
5. During the period that this Agreement is in effect,
BancFlorida agrees that it will not exercise any redemption
rights it may have with respect to the Preferred Shares.
6. The parties hereto agree that this Agreement shall
terminate and be of no further force and effect if the Plan is
terminated in accordance with its terms or if the Board of
Directors of BancFlorida withdraws its endorsement of the
transactions contemplated by the Plan.
7. BancFlorida hereby (i) acknowledges and confirms the
Holder's demand under the Registration Agreement dated January
13, 1989 between BancFlorida and the Holder, to register the
Converted Common Shares, and (ii) agrees to commence all
necessary steps to register the same notwithstanding any contrary
provisions which may be contained in such Registration Agreement.
Notwithstanding the foregoing, it is understood and agreed that
Holder has no affirmative obligation to convert the Preferred
Shares into Converted Common Shares.
8. During the period that this Agreement is in effect,
BancFlorida agrees to use its best efforts to maintain the
required regulatory approvals to pay dividends on the Preferred
Shares in accordance with the applicable provisions of
BancFlorida's Certificate of Incorporation and First Union agrees
to cooperate with BancFlorida in connection with such efforts.
If BancFlorida is not able to maintain such approval and as a
result is not able to pay Holder any of such dividends on the
Preferred Shares, First Union agrees to pay such omitted
dividends plus interest from the date of arrearage at the
Effective Federal Funds Rate to Holder on the effective date of
the acquisition of BancFlorida by First Union pursuant to the
Plan, in cash, or at the option of First Union, in shares of
First Union common stock with a value (on such effective date)
equal to the amount of such omitted dividends.
9. The Holder represents and warrants:
(i) the Holder has good title to the Preferred Shares and
owns the Preferred Shares free and clear of any rights, claims,
encumbrances, liens, interests or restrictions of any nature
whatsoever, including, without limitation, any restrictions on
the voting of the Preferred Shares or any rights of others to
vote, or to participate (including by consultation) in the voting
of, the Preferred Shares; and
(ii) this Agreement has been duly authorized by all
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necessary action on the part of the Holder and is a valid and
legally binding agreement enforceable against the Holder in
accordance with its terms, subject to bankruptcy, insolvency and
other laws of general applicability relating to or affecting
creditors' rights and to general equity principles; and
(iii) the execution, delivery and performance of this
Agreement, and the consummation of the transactions contemplated
hereby by the Holder, does not and will not constitute a breach
or violation of, or a default under, any law, rule or regulation
or any judgment, decree, order, governmental permit or license,
or agreement, indenture or instrument of the Holder or to which
the Holder is subject or bound, or require any consent or
approval under such law, rule, regulation, judgment, decree,
order, governmental permit or license or the consent or approval
of any other party to any such agreement, indenture or
instrument.
10. BancFlorida represents and warrants that its
representations and warranties in the Plan apply equally to this
Agreement.
11. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to constitute an
original. This Agreement shall become effective when one
counterpart has been signed by each party hereto.
IN WITNESS WHEREOF, the parties have caused this instrument
to be executed as of the day and year first above written.
FIRST UNION CORPORATION
By: /s/ Kenneth R. Stancliff
Name: Kenneth R. Stancliff
Title: Senior Vice President
BANCFLORIDA FINANCIAL
CORPORATION
By: /s/ Rudolf P. Guenzel
Name: Rudolf P. Guenzel
Title: President and Chhief
Executive Officer
/s/ William R. Berkley
William R. Berkley
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