As filed with the Securities and Exchange Commission on November
7, 1994.
Registration No. 33-__________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Hibernia Corporation
(Exact name of Registrant as specified in its charter)
LOUISIANA 72-0724532
(State or other (I.R.S. Employer
jurisdiction of incorporation Identification Number)
or organization)
Hibernia Corporation
313 Carondelet Street
New Orleans, Louisiana 70130
(504) 533-5552
(Address, including zip code, and telephone number,
including area code, of Registrant's principal executive offices)
Gary L. Ryan, Esq.
Vice President and Associate Counsel
Hibernia Corporation
313 Carondelet Street
New Orleans, Louisiana 70130
(504) 533-5560
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copies to:
Patricia C. Meringer, Esq.
Associate Counsel and Secretary
Hibernia Corporation
225 Baronne Street, 11th Floor
New Orleans, Louisiana 70112
(504) 533-2486
Virginia Boulet, Esq. Martin D. Werner, Esq.
Phelps Dunbar, L.L.P. Werner & Blank Co., L.P.A.
30th Floor, 400 Poydras Street 7205 West Central Avenue
New Orleans, Louisiana 70130-3245 Toledo, Ohio 43617
(504) 566-1311 (419) 841-8051
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
As soon as practicable after the effective date of this
Registration Statement
If the securities being registered on this form are being
offered in connection with the formation of a holding company and
there is compliance with General Instruction G, check the
following box. ________
/_______/
CALCULATION OF REGISTRATION FEE
Title of each Amount to be Proposed Proposed Amount of
class of Registered Maximum Maximum Registration
securities to Offering Aggregate Fee (1)
be registered Price Per Offering
Unit (1) Price (1)
Class A
Common Stock,
no par value 3,350,000 $5.98 $20,033,000 $6,907.93
Shares
(1) Based upon the book value of the Common Stock of First State
Bank and Trust Company of Bogalusa on June 30, 1994 and
estimated solely for the purpose of calculating the
registration fee in accordance with Rule 457(f)(2) under the
Securities Act of 1933.
The Registrant hereby amends this Registration Statement on
such date or dates as may be necessary to delay its effective
date until the Registrant shall file a further amendment which
specifically states that this Registration Statement shall
thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement
shall become effective on such date as the Commission, acting
pursuant to said Section 8(a), may determine.
HIBERNIA CORPORATION
Cross Reference Sheet Pursuant to Item 501(b) of Regulation S-K
Item of Form S-4 Location or Caption in
Prospectus
1. Forepart of Registration
Statement and Outside
Front Cover Page of
Prospectus . . . . . . . . . . . . . . Introduction
2. Inside Front and Outside
Back Cover Pages of
Prospectus . . . . . . . . . . . . . . Table of Contents;
Available Information
3. Risk Factors, Ratio of
Earnings to Fixed Charges,
and Other Information. . . . . . . . . Summary; Proposed Merger;
Meeting Information
4. Terms of the Transaction . . . . . . . Summary; Proposed Merger
5. Pro Forma .. . . . . . . . . . . . . . Summary; Pro Forma Financial
Information
6. Material Contacts with the
Company Being Acquired . . . . . . . . Not Applicable
7. Additional Information
Required for Reoffering by
Persons and Parties Deemed
to be Underwriters . . . . . . . . . . Not Applicable
8. Interests of Named Experts
and Counsel. . . . . . . . . . . . . . Validity of Shares
9. Disclosure of Commission
Position on
Indemnification for
Securities Act
Liabilities. . . . . . . . . . . . . . Not Applicable
10. Information with Respect
to S-3 Registrants . . . . . . . . . . Certain Information About
Hibernia
11. Incorporation of Certain
Information by Reference . . . . . . . Available Information;
Incorporation by Reference
12. Information With Respect
to S-2 or S-3 Registrants. . . . . . . Not Applicable
13. Incorporation of Certain
Information by Reference . . . . . . . Available Information;
Incorporation by Reference
14. Information with Respect
to Registrants Other Than
S-3 or S-2 Registrants . . . . . . . . Not Applicable
15. Information With Respect
to S-3 Companies . . . . . . . . . . . Not Applicable
16. Information With Respect
to S-2 or S-3 Companies. . . . . . . . Not Applicable
17. Information With Respect
to Companies Other Than
S-2 or S-3 Companies . . . . . . . . . Available Information;
Incorporation by Reference;
Certain Information About
First State; Financial
Statements of First State
18. Information if Proxies,
Consents or Authorizations
Are to be Solicited. . . . . . . . . . Incorporation by Reference;
Summary; Meeting
Information; Proposed
Merger; Rights of
Dissenting Shareholders;
Beneficial Ownership of
Directors, Executive
Officers and Principal
Shareholders of First State
19. Information if Proxies,
Consents or Authorizations
Are Not to be Solicited,
or in an Exchange Offer. . . . . . . . Not Applicable
FIRST STATE BANK AND TRUST COMPANY OF BOGALUSA
346 COLUMBIA STREET
BOGALUSA, LOUISIANA 70427-3967
November __, 1994
Dear Shareholder:
You are cordially invited to attend a special meeting of
shareholders of First State Bank and Trust Company of Bogalusa
("First State") to be held at First State's main office, 346
Columbia Street, Bogalusa, Louisiana on Thursday, December 15, 1994
at 4:15 p.m.
At this meeting, you will have an opportunity to consider and
vote on the terms of an Agreement and Plan of Merger (the
"Agreement") providing for the merger of First State with and into
Hibernia National Bank, a wholly-owned bank subsidiary of Hibernia
Corporation (the "Merger"). The Agreement provides that, on the
effective date of the Merger, each outstanding share of First State
common stock will be converted into 33.5 shares of Hibernia
Corporation common stock, subject to adjustment as described in the
attached Proxy Statement.
The enclosed Notice of Special Meeting of Shareholders and
Proxy Statement explain the Merger and provide specific information
about the special meeting. Please carefully read these materials
and thoughtfully consider the information contained in them. Your
vote is of great importance, as the approval of First State
shareholders is required to consummate the Merger.
Whether or not you plan to attend the special meeting, you are
urged to complete, date, sign and promptly return the enclosed
proxy card to assure that your shares will be voted at the special
meeting.
Your Board of Directors unanimously recommends that you vote
FOR the Merger. The proposed Merger has also been unanimously
approved by the Boards of Directors of Hibernia Corporation and
Hibernia National Bank.
Sincerely,
Charles J. Cassidy
Chairman of the Board and
President
FIRST STATE BANK AND TRUST COMPANY OF BOGALUSA
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON THURSDAY, DECEMBER 15, 1994
Notice is hereby given that a Special Meeting of Shareholders
of First State Bank and Trust Company of Bogalusa ("First State")
has been called by the Board of Directors and will be held at First
State's main office, 346 Columbia Street, Bogalusa, Louisiana on
Thursday, December 15, 1994 at 4:15 p.m., to consider and vote upon
the following matters:
1. A proposal to approve an Agreement and Plan of Merger dated
as of August 18, 1994, (the "Agreement"), by and among Hibernia
Corporation ("Hibernia"), Hibernia National Bank ("HNB") and First
State, a copy of which is attached as Appendix A to the
accompanying Proxy Statement. The Agreement provides that First
State will merge with and into HNB, a wholly-owned bank subsidiary
of Hibernia, and each outstanding share of common stock of First
State will be converted into 33.5 shares of common stock of
Hibernia, subject to adjustment, all as more fully described in the
accompanying Proxy Statement.
2. The transaction of such other business as may properly come
before the meeting or any adjournments or postponements thereof.
The Board of Directors is not aware of any other business to
come before the meeting.
Only shareholders of record at the close of business on
November 8, 1994 are entitled to receive notice of and to vote at
the special meeting.
Dissenting shareholders who comply with the procedural
requirements of the Louisiana Banking Law will be entitled to
receive payment of the fair cash value of their shares.
Whether or not you plan to attend the special meeting, please
complete, date and sign the enclosed proxy card and return it
promptly in the stamped return envelope so that your shares will be
represented at the meeting. If you attend the special meeting in
person, you may revoke your proxy and vote your own shares.
By Order of the Board of Directors,
Robert J. Puckett
Secretary
Bogalusa, Louisiana
Dated: November __, 1994
PROSPECTUS
3,350,000 SHARES
HIBERNIA CORPORATION
Class A Common Stock
PROXY STATEMENT
FIRST STATE BANK AND TRUST COMPANY OF BOGALUSA
Special Meeting of Shareholders to be
held Thursday, December 15, 1994
This Proxy Statement is being furnished to the shareholders of
First State Bank and Trust Company of Bogalusa ("First State"), a
Louisiana banking association, in connection with the solicitation
of proxies by the First State Board of Directors for use at the
Special Meeting of First State shareholders to be held at 4:15 p.m.
on Thursday, December 15, 1994, at 346 Columbia Street, Bogalusa,
Louisiana, and at any adjournments or postponements thereof (the
"Special Meeting").
At the Special Meeting, the shareholders of First State will
consider and vote upon a proposal to approve the Agreement and Plan
of Merger dated as of August 18, 1994 (the "Agreement") between
Hibernia Corporation ("Hibernia"), Hibernia National Bank ("HNB"),
and First State, pursuant to which, among other things, (a) First
State will merge with and into HNB (the "Merger") and (b) each
outstanding share of common stock, $10.00 par value, of First State
("First State Common Stock") will be converted into 33.5 shares of
Class A common stock, no par value, of Hibernia ("Hibernia Common
Stock"), subject to adjustment as described herein and in the
Agreement, which is included herein as Appendix A to this Proxy
Statement. See "Proposed Merger."
This document also constitutes a prospectus of Hibernia with
respect to the Hibernia Common Stock to be issued to the
shareholders of First State pursuant to the terms of the Merger.
The outstanding shares of Hibernia Common Stock are, and the shares
offered hereby will be, listed on the New York Stock Exchange, Inc.
(the "NYSE"). The last reported sale price of Hibernia Common
Stock on the NYSE on November __, 1994 was $_______ per share.
THE SHARES OF HIBERNIA COMMON STOCK OFFERED HEREBY ARE NOT
SAVINGS ACCOUNTS, DEPOSITS OR OTHER OBLIGATIONS OF A BANK
OR SAVINGS ASSOCIATION AND ARE NOT INSURED BY THE
FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY
OTHER GOVERNMENTAL AGENCY.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION, NOR HAS THE COMMISSION OR ANY STATE
SECURITIES COMMISSION PASSED UPON THE ACCURACY
OR ADEQUACY OF THIS PROXY STATEMENT. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Proxy Statement is November ____, 1994.
AVAILABLE INFORMATION
Hibernia is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and,
in accordance therewith, files reports, proxy statements and other
information with the Securities and Exchange Commission (the "Commis-
sion"). Such reports, proxy statements and other information can be
inspected at, and copies thereof may be obtained at prescribed rates
from the public reference facilities maintained by the Commission at
Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and at the
Commission's Regional Offices located at 7 World Trade Center, Suite
1300, New York, New York 10048 and Northwestern Atrium Center, 500
West Madison Street, Suite 1400, Chicago, Illinois 60621-2511.
Common stock of Hibernia is listed for trading on the NYSE and any
reports, proxy statements and other information concerning Hibernia
may be inspected at its offices which are located at 20 Broad Street,
New York, New York 10005.
Hibernia has filed with the Commission a Registration Statement on
Form S-4 (together with all amendments and exhibits thereto, the
"Registration Statement") under the Securities Act of 1933, as
amended (the "Securities Act") with respect to the securities of
Hibernia that may be issued in connection with the transaction
described herein. This Proxy Statement does not contain all of the
information set forth in the Registration Statement or the exhibits
thereto. For further information with respect to Hibernia and the
Hibernia Common Stock offered hereby, reference is hereby made to such
Registration Statement and exhibits. Statements contained in this
Proxy Statement concerning the provisions of certain documents are
not necessarily complete and, in each instance, reference is made to
the copy of the document filed as an exhibit to the Registration
Statement, each such statement being qualified in all respects by such
reference. Copies of all or any part of the Registration Statement,
including exhibits thereto, may be obtained, upon payment of the
prescribed fees, at the offices of the Commission and the NYSE, as set
forth above.
All information contained in this Proxy Statement relating to
Hibernia and its subsidiaries has been supplied by Hibernia, and all
information relating to First State has been supplied by First State.
INCORPORATION BY REFERENCE
This Proxy Statement incorporates documents by reference which are
not presented herein or delivered herewith. These documents are
available, without charge, to any person receiving this Proxy
Statement, including beneficial owners of First State Common Stock.
The request may be written or oral and should be directed to the
Assistant Corporate Secretary of Hibernia Corporation, 313 Carondelet
Street, New Orleans, Louisiana 70130, telephone number (504) 533-
3411. To ensure timely delivery of the documents, any request should
be made by December 8, 1994.
The following documents, or the indicated portions thereof, are
hereby incorporated by reference into this Proxy Statement.
(1) Hibernia's Annual Report on Form 10-K for the year ended
December 31, 1993;
(2) Hibernia's Quarterly Reports on Form 10-Q for the quarters
ended March 31, 1994 and June 30, 1994;
(3) Hibernia's definitive Proxy Statement dated April 8, 1994
relating to its 1994 Annual Meeting of Shareholders held on
April 26, 1994, except the information contained under the
headings "Executive Compensation -- Report of the Executive
Compensation Committee" and "-- Stock Performance Graph";
(4) Hibernia's supplemental consolidated financial statements
for the year ended December 31, 1993, set forth in
Hibernia's Current Report on Form 8-K dated October 11,
1994;
(5) Hibernia's Current Reports on Form 8-K dated August 18,
1994 and September 22, 1994;
(6) The description of Hibernia Common Stock set forth in
Hibernia's Current Report on Form 8-K dated November 2,
1994; and
(7) All other reports subsequently filed by Hibernia with the
Commission pursuant to Sections 13(a), 13(c), 14 or 15(d)
of the Exchange Act after the date of this Proxy Statement
and prior to the Special Meeting shall be deemed to be
incorporated by reference from the date such documents are
filed; provided, however, that the information disclosed in
the proxy statement of Hibernia under the heading
"Executive Compensation -- Report of the Executive
Compensation Committee" and "-- Stock Performance Graph" is
hereby expressly excluded from such incorporation by
reference. Any statement contained in a document
incorporated or deemed to be incorporated by reference
herein shall be deemed to be modified or superseded for the
purposes of this Proxy Statement to the extent that a
statement in this Proxy Statement, or any subsequently
filed document that is also incorporated by reference
herein, modifies or supersedes such statement. Any
statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of
this Proxy Statement.
No person is authorized to give any information or to make any
representations other than those contained herein and, if given or
made, such information or representations may not be relied upon as
having been authorized. This document does not constitute an offer
or solicitation by anyone in any jurisdiction in which such offer or
solicitation is not authorized or in which the person making such
offer or solicitation is not qualified to do so or to any person to
whom it is unlawful to make such offer or solicitation. Neither the
delivery of this document nor any distribution of securities made
hereunder shall under any circumstances create an implication that
there has been no change in the affairs of Hibernia or First State
since the date hereof or that the information herein is correct as of
any time subsequent to the date hereof.
TABLE OF CONTENTS
SUMMARY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . i
MEETING INFORMATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Vote Required. . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Recommendation . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
PROPOSED MERGER. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Background of and Reasons for the Merger . . . . . . . . . . . . . . 2
Terms of the Merger. . . . . . . . . . . . . . . . . . . . . . . . . 4
Opinion of Financial Advisor . . . . . . . . . . . . . . . . . . . . 5
Surrender of Certificates. . . . . . . . . . . . . . . . . . . . . . 8
Representations and Warranties; Conditions to the Merger;
Waiver. . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Regulatory Approvals . . . . . . . . . . . . . . . . . . . . . . . . 9
Business Pending the Merger. . . . . . . . . . . . . . . . . . . . .10
Effective Date of the Merger; Termination. . . . . . . . . . . . . .10
Management and Operations After the Merger . . . . . . . . . . . . .11
Certain Differences in Rights of Shareholders. . . . . . . . . . . .11
Interests of Certain Persons in the Merger . . . . . . . . . . . . .13
Employee Benefits. . . . . . . . . . . . . . . . . . . . . . . . . .13
Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14
Material Tax Consequences. . . . . . . . . . . . . . . . . . . . . .14
Resale of Hibernia Common Stock. . . . . . . . . . . . . . . . . . .15
Dividend Reinvestment Plan . . . . . . . . . . . . . . . . . . . . .15
Accounting Treatment . . . . . . . . . . . . . . . . . . . . . . . .16
RIGHTS OF DISSENTING SHAREHOLDERS. . . . . . . . . . . . . . . . . . . . .16
PRO FORMA FINANCIAL INFORMATION. . . . . . . . . . . . . . . . . . . . . .18
CERTAIN INFORMATION ABOUT HIBERNIA . . . . . . . . . . . . . . . . . . . .29
Supervision and Regulation . . . . . . . . . . . . . . . . . . . . .30
CERTAIN INFORMATION ABOUT FIRST STATE. . . . . . . . . . . . . . . . . . .31
Business of First State. . . . . . . . . . . . . . . . . . . . . . .31
Employees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .31
Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . .32
Competition. . . . . . . . . . . . . . . . . . . . . . . . . . . . .32
Supervision and Regulation . . . . . . . . . . . . . . . . . . . . .32
Management's Discussion and Analysis of Financial Condition
and Results of
Operations of First State For The Two Years Ended December 31,
1993 and
December 31, 1992 . . . . . . . . . . . . . . . . . . . . . . . .33
Results of Operations. . . . . . . . . . . . . . . . . . . . . . . .33
Analysis of Financial Condition. . . . . . . . . . . . . . . . . . .37
Management's Discussion and Analysis of Financial Condition
and Results of
Operations of First State For The Six-Month Periods Ended June
30, 1994 and
June 30, 1993.. . . . . . . . . . . . . . . . . . . . . . . . . .43
Results of Operations and Analysis of Financial Condition. . . . . .44
BENEFICIAL OWNERSHIP OF DIRECTORS, EXECUTIVE OFFICERS AND
PRINCIPAL SHAREHOLDERS OF FIRST STATE . . . . . . . . . . . . . . . . .45
Security Ownership Of Directors and Executive Officers . . . . . . .45
Security Ownership of Principal Shareholders . . . . . . . . . . . .45
RELATIONSHIP WITH INDEPENDENT AUDITORS . . . . . . . . . . . . . . . . . .46
VALIDITY OF SHARES . . . . . . . . . . . . . . . . . . . . . . . . . . . .46
EXPERTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .46
FINANCIAL STATEMENTS OF FIRST STATE. . . . . . . . . . . . . . . . . . .F-1
Appendix A - Agreement and Plan of Merger. . . . . . . . . . . . . .A-1
Appendix B - Fairness Opinion of Austin Associates, Inc. . . . . . .B-1
Appendix C - Tax Opinion of Ernst & Young LLP. . . . . . . . . . . .C-1
Appendix D - Selected Provisions of Federal and State
Law Relating to the Rights of
Dissenting Shareholders. . . . . . . . . . . . . . .D-1
SUMMARY
This summary is not intended to be a complete explanation of the
matters covered in this Proxy Statement and is qualified in its
entirety by reference to the more detailed information contained
elsewhere in this Proxy Statement, the Appendices hereto and the
documents incorporated herein by reference, all of which shareholders
are urged to read carefully prior to the Special Meeting. Unless
otherwise indicated, financial information concerning Hibernia refers
to historical June 30, 1994 financial information, and does not
reflect the four mergers consummated by Hibernia subsequent to June
30, 1994 or any other pending acquisitions by Hibernia.
The Parties to the Merger
Hibernia. Hibernia is a Louisiana corporation registered under
the Bank Holding Company Act of 1956, as amended (the "BHCA"). As of
June 30, 1994, Hibernia had total consolidated assets of
approximately $4.9 billion and shareholders' equity of approximately
$443 million. As of June 30, 1994, Hibernia was ranked, on the basis
of total assets, as the 90th largest bank holding company in the
United States and the second largest headquartered in Louisiana.
Hibernia has a single banking subsidiary, Hibernia National Bank
("HNB"), a national banking association that provides retail and
commercial banking services through 101 branches throughout
Louisiana. The principal executive offices of Hibernia are located
at 313 Carondelet Street, New Orleans, Louisiana 70130, and its
telephone number is (504) 533-5532. See "Certain Information About
Hibernia" and "Available Information."
Hibernia consummated four mergers in the third quarter of 1994,
two as of July 1, 1994 and two as of August 1, 1994. All of the mergers
were accounted for as poolings of interests. Supplemental
consolidated financial statements of Hibernia as of December 31,
1993, reflecting the impact of these mergers, are included in
Hibernia's Current Report on Form 8-K filed with the Commission on
October 11, 1994, and are incorporated herein by reference. As
restated to reflect these mergers, Hibernia's total assets and
shareholders' equity as of December 31, 1993 were $5.7 billion and
$474 million, respectively.
From time to time, Hibernia investigates and holds discussions
and negotiations in connection with possible transactions with other
banks and financial institutions. Hibernia has executed definitive
merger agreements with three institutions in addition to First State
as of the date of this Proxy Statement. Each of the transactions is
subject to various conditions, including applicable regulatory
approvals, and is described further herein under "Other Pending
Merger Transactions for Hibernia" and under "Pro Forma Financial
Information." At the date hereof, Hibernia has not entered into any
agreements or understandings with respect to any significant
transactions of the type described except those described in
documents incorporated herein by reference or described herein.
Although it is anticipated that such transactions may be entered into
both before and after the Merger, there can be no assurance as to when
or if, or the terms upon which, such transactions may be pursued or
consummated.
On October 12, 1994, Hibernia publicly reported third-quarter net
income of $23.2 million ($.24 per share), up 64% from $14.1 million
($.15 per share) for the same period of 1993, and up 33% from $17.4
million ($.18 per share) for the second quarter of 1994. Hibernia's
third quarter results reflect a negative provision for loan losses of
$17.5 million and a $16.1 million write-off of goodwill associated
with acquisitions in the mid to late 1980's.
SELECTED FINANCIAL DATA ABOUT HIBERNIA
(Unaudited)
The following table sets forth certain historical and restated
consolidated financial information for Hibernia. The Hibernia
information is based on historical financial statements and related
notes of Hibernia incorporated by reference into this Proxy
Statement. The restated information reflects the impact of four
mergers consummated in the third quarter of 1994, two each as of July
1 and August 1, all of which were accounted for as poolings of
interests. Pro forma financial information giving effect to the
Merger and other probable mergers is included herein under "Pro Forma
Financial Information."
<PAGE>
<TABLE>
HIBERNIA CORPORATION
SELECTED FINANCIAL INFORMATION
<CAPTION>
6 Months Ended
Year Ended December 31 June 30
- ----------------------------------------------------------------------------------------------------------------------------------
Unaudited ($ in thousands, except per share amounts) 1993 1992 1991 1990 1989 1994 1993
-------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Net interest income $195,705 $197,278 $234,599 $261,318 $214,530 $99,008 $99,569
Income (loss) from continuing operations 47,950 (7,915) (143,997) (10,995) 61,644 35,575 21,801
Per share:
Income (loss) from continuing operations 0.58 (0.27) (5.12) (0.40) 2.30 0.43 0.26
Cash dividends 0.03 - .15 .90 .91 0.08 -
Book value 5.12 4.48 7.05 13.16 14.45 5.29 4.72
SELECTED PERIOD-END BALANCES
Debt - 8,269 94,534 104,367 55,406 - -
Total assets 4,795,583 4,734,038 6,018,429 7,357,850 6,698,851 4,857,164 4,667,976
</TABLE>
<TABLE>
<CAPTION>
RESTATED HIBERNIA CORPORATION (1)
SELECTED FINANCIAL INFORMATION
6 Months Ended
Year Ended December 31 June 30
- ---------------------------------------------------------------------------------------------------------------------------------
Unaudited ($ in thousands, except per share amounts) 1993 1992 1991 1990 1989 1994 1993
------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Net interest income $234,064 $234,398 $263,348 $285,614 $238,989 $117,896 $118,701
Income (loss) from continuing operations 55,391 (1,752) (141,367) (17,014) 58,148 37,055 25,922
Per share:
Income (loss) from continuing operations 0.58 (0.04) (3.44) (0.42) 1.46 0.38 0.27
Cash dividends 0.03 - 0.15 0.90 0.91 0.08 -
Book value 4.91 4.24 5.18 9.52 10.33 5.02 4.51
SELECTED PERIOD-END BALANCES
Debt 23,981 25,710 127,566 123,145 91,077 3,741 20,935
Total assets 5,720,013 5,592,710 6,862,752 8,172,331 7,531,137 5,691,832 5,517,784
</TABLE>
First State. First State is a banking association formed
under the laws of the State of Louisiana and headquartered in
Bogalusa, Louisiana. As of June 30, 1994, First State had total
assets of $149.7 million and shareholders' equity of $20 million.
First State has six offices in Washington Parish and two offices
in St. Tammany Parish, Louisiana. First State engages in a range
of retail and commercial banking services, including taking
deposits and extending secured and unsecured credit. The
principal executive offices of First State are located at 346
Columbia Street, Bogalusa, Louisiana 70427-3967, and its
telephone number is (504) 732-3633. For additional information
concerning the business of First State and its financial
condition, see "Certain Information About First State" and
"Financial Statements of First State."
SELECTED FINANCIAL DATA ABOUT FIRST STATE
(Unaudited)
The following table sets forth certain historical financial
information for First State. This information is based on
historical financial statements and related notes of First State
contained elsewhere in this Proxy Statement.
<PAGE>
<TABLE>
FIRST STATE BANK AND TRUST COMPANY
SELECTED FINANCIAL INFORMATION
<CAPTION>
Year Ended December 31 6 Months Ended June 30
- ------------------------------------------------------------------------------------------------------------------------------------
Unaudited ($ in thousands, except per share amounts) 1993 1992 1991 1990 1989 1994 1993
----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Net interest income $6,245 $5,807 $4,523 $3,836 $3,641 $2,880 $3,015
Income from continuing operations 1,981 1,515 280 376 396 595 764
Per share:
Income from continuing operations 19.81 15.15 2.80 3.76 3.96 5.95 7.64
Cash dividends 1.00 1.00 1.00 1.00 0.75 - -
Book value 194.33 175.52 161.37 158.52 155.76 200.28 183.16
SELECTED PERIOD-END BALANCES
Debt - - - - - - -
Total assets 146,867 150,054 143,422 127,199 115,970 149,686 146,852
</TABLE>
<PAGE>
FIRST STATE BANK AND TRUST COMPANY
QUARTERLY INCOME RESULTS
- -------------------------------------------------------------------------------
Unaudited ($ in thousands, except per share amounts)
<TABLE>
<CAPTION>
1994
------------------------
I II
------ ------
<S> <C> <C>
Interest income $2,240 $2,280
Net interest income 1,444 1,436
Net income 289 306
Net income per share $2.89 $3.06
1993
--------------------------------------------------
I II III IV
------- -------- --------- --------
<S> <C> <C> <C> <C>
Interest income $2,535 $2,448 $2,488 $2,469
Net interest income 1,482 1,533 1,617 1,613
Net income 498 266 317 900
Net income per share $4.98 $2.66 $3.17 $9.00
1992
--------------------------------------------------
I II III IV
------- -------- ------- -------
<S> <C> <C> <C> <C>
Interest income $2,754 $2,795 $2,635 $2,645
Net interest income 1,354 1,476 1,430 1,547
Net income 288 568 513 146
Net income per share $2.88 $5.68 $5.13 $1.46
</TABLE>
PRO FORMA COMBINED SELECTED FINANCIAL INFORMATION
(Unaudited)
The following table sets forth certain unaudited pro forma
combined financial information for Hibernia (on a restated basis,
after giving effect to the mergers of Commercial Bancshares, Inc.
("Commercial") and Bastrop National Bank ("Bastrop"), consummated
on July 1, 1994, and to the mergers of First Continental
Bancshares, Inc. ("First Continental") and First Bancorp of
Louisiana, Inc. ("First Bancorp"), consummated on August 1, 1994)
and First State. See Note A to the Pro Forma Combined Financial
Statements contained elsewhere herein. Year end information in
this table is based on, and should be read in conjunction with,
the audited restated supplemental consolidated financial
statements and related notes of Hibernia, incorporated into this
Proxy Statement by reference to Hibernia's Current Report on Form
8-K dated October 11, 1994, and the historical financial
statements of First State contained elsewhere in this Proxy
Statement. The table also gives effect to probable mergers with
Pioneer Bancshares Corporation ("Pioneer"), American Bank
("American Bank") and STABA Bancshares, Inc. ("STABA") to which
Hibernia is a party, as discussed in Notes C and D to the Pro
Forma Combined Financial Statements. The pro forma information,
which reflects each of the consummated and probable mergers using
the pooling of interests method of accounting, is presented for
informational purposes only and should not be construed as
indicative of the actual operations that would have occurred had
the mergers been consummated at the beginning of the periods
indicated or which may occur after all the mergers are
consummated. The pro forma information gives effect to the
issuance, in each of the periods presented, of 13,021,494 shares
of Hibernia Common Stock for all of the outstanding shares of
Commercial, Bastrop, First Continental, and First Bancorp and
assumes the issuance of 3,350,000 shares of Hibernia Common Stock
for all of the outstanding shares of First State; 8,370,512
shares of Hibernia Common Stock for all of the outstanding shares
of Pioneer; 2,250,000 shares of Hibernia Common Stock for all of
the outstanding shares of American Bank; and 2,117,647 shares of
Hibernia Common Stock for all of the outstanding shares of STABA.
<PAGE>
PRO FORMA HIBERNIA CORPORATION*
PRO FORMA COMBINED SELECTED FINANCIAL INFORMATION
<TABLE>
<CAPTION>
Year Ended December 31 6 Months Ended June 30
Unaudited ($ in thousands, except per share amounts) 1993 1992 1991 1994 1993
<S> <C> <C> <C> <C> <C>
Net interest income $240,309 $240,205 $267,871 $120,776 $121,716
Income (loss) from continuing operations 57,372 (237) (141,087) 37,650 26,686
Per share:
Income (loss) from continuing operations 0.58 (0.01) (3.17) 0.38 0.27
Cash dividends 0.03 - 0.15 0.08 -
Book value 4.94 4.27 5.15 5.06 4.54
SELECTED PERIOD-END BALANCES
Debt 23,981 25,710 127,566 3,741 20,935
Total assets 5,866,723 5,742,764 7,006,257 5,841,518 5,664,636
* Includes Hibernia Corporation, First State Bank and Trust Company, Commercial Bancshares, Inc.,
Bastrop National Bank, First Continental Bancshares, Inc. and First Bancorp of Louisiana, Inc.
</TABLE>
TOTAL PRO FORMA HIBERNIA CORPORATION**
PRO FORMA COMBINED SELECTED FINANCIAL INFORMATION
<TABLE>
<CAPTION>
Year Ended December 31 6 Months Ended June 30
Unaudited ($ in thousands, except per share amounts) 1993 1992 1991 1994 1993
<S> <C> <C> <C> <C> <C>
Net interest income $265,772 $264,950 $287,859 $133,496 $134,197
Income (loss) from continuing operations 63,525 4,028 (138,287) 41,261 29,668
Per share:
Income (loss) from continuing operations 0.57 0.07 (2.42) 0.37 0.27
Cash dividends 0.03 - 0.15 0.08 -
Book value 4.75 4.11 4.58 4.88 4.38
SELECTED PERIOD-END BALANCES
Debt 30,194 32,587 134,809 3,741 27,449
Total assets 6,411,382 6,280,720 7,517,772 6,390,153 6,210,083
**Includes Hibernia Corporation, First State Bank and Trust Company, Commercial Bancshares, Inc., Bastrop National Bank, First
Continental Bancshares, Inc., First Bancorp of Louisiana, Inc., Pioneer Bancshares Corporation, American Bank and
STABA Bancshares, Inc.
</TABLE>
COMPARATIVE PER SHARE INFORMATION
(Unaudited)
The following table sets forth for Hibernia Common Stock and
First State Common Stock certain historical, restated, unaudited
pro forma combined and unaudited pro forma equivalent per share
financial information. This table is based on and should be read
in conjunction with the supplemental consolidated financial
statements and the historical financial statements and related
notes of Hibernia, incorporated by reference into this Proxy
Statement, and the historical financial statements of First State
contained elsewhere in this Proxy Statement. The restated
information reflects the impact of four mergers consummated in
the third quarter of 1994, two each as of July 1 and August 1,
all of which were accounted for as poolings of interests. The
pro forma combined information, which reflects the Merger using
the pooling of interests method of accounting, is presented for
informational purposes only and should not be construed as
indicative of the actual results that would have occurred had the
Merger been consummated at the beginning of the periods indicated
or which may occur after the Merger is consummated. The pro
forma combined information gives effect to the issuance of
3,350,000 shares of Hibernia Common Stock for all the outstanding
shares of First State Common Stock, which assumes that each share
of First State Common Stock will be exchanged for 33.5 shares of
Hibernia Common Stock. See "Proposed Merger -- Terms of the
Merger."
<PAGE>
<TABLE>
HIBERNIA CORPORATION AND FIRST STATE BANK AND TRUST COMPANY
COMPARATIVE PER SHARE INFORMATION
- ------------------------------------------------------------------------------------------------------------------------------------
Unaudited
<CAPTION>
PRO FORMA FIRST STATE
HISTORICAL HIBERNIA BANK AND
HISTORICAL RESTATED FIRST STATE CORPORATION TRUST COMPANY
HIBERNIA HIBERNIA BANK AND (WITH FIRST STATE PRO FORMA
CORPORATION CORPORATION (1) TRUST COMPANY BANK AND TRUST) (1) EQUIVALENT (2)
--------------------------------------------------------------------------------------
Per Common Share:
Income (loss) from continuing operations:
For the six months ended June 30,
<S> <C> <C> <C> <C> <C>
1994 $0.43 $0.38 $5.95 $0.38 $12.73
1993 0.26 0.27 7.64 0.27 9.05
For the year ended December 31,
1993 $0.58 $0.58 $19.81 $0.58 $19.43
1992 (0.27) (0.04) 15.15 (0.01) (0.34)
1991 (5.12) (3.44) 2.80 (3.17) 106.20
Cash dividends:
For the six months ended June 30,
1994 $0.08 $0.08 - $0.08 $2.68
1993 - - - - -
For the year ended December 31,
1993 $0.03 $0.03 $1.00 $0.03 $1.01
1992 - - 1.00 - -
1991 0.15 0.15 1.00 0.15 5.03
Book Value:
At June 30, 1994 $5.29 $5.02 $200.28 $5.06 $169.51
At December 31, 1993 $5.12 $4.91 $194.33 $4.94 $165.49
(1) Refer to "PRO FROMA FINANCIAL INFORMATION".
(2) Pro forma equivalent amounts are computed by multiplying the pro forma combined amount by the
First State Bank and Trust exchange ratio of 33.50.
</TABLE>
The Special Meeting
The Special Meeting of the shareholders of First State to
consider and vote upon the Agreement will be held on Thursday,
December 15, 1994 at 4:15 p.m. at the main office of First State,
346 Columbia Street, Bogalusa, Louisiana. Only holders of record
of First State Common Stock at the close of business on
November 8, 1994 (the "Record Date") will be entitled to notice
of and to vote at the Special Meeting. On the Record Date,
100,000 shares of First State Common Stock were outstanding and
entitled to vote on the Merger. For additional information with
respect to the Special Meeting and the voting rights of
shareholders of First State, see "Meeting Information."
The Proposed Merger
In accordance with the terms of the Agreement, First State
will be merged with and into HNB, whereupon the separate
existence of First State will cease. The Merger will become
effective at the date and time (the "Effective Date") set forth
in a letter issued by the Office of the Comptroller of the
Currency (the "OCC"). Unless otherwise agreed upon by Hibernia
and First State, the Effective Date will be the later of: (i) the
first business day that falls 30 days after the date of the order
of the OCC approving the Merger; (ii) the first business day that
falls 5 days after the Special Meeting; or (iii) such other date
within 60 days of the Special Meeting as may be agreed upon by
the parties. On the Effective Date, each outstanding share of
First State Common Stock, other than shares held by shareholders
who exercise and perfect dissenters' rights in accordance with
applicable law, will be converted into 33.5 shares of Hibernia
Common Stock (the "Exchange Rate"), subject to three possible
adjustments described below.
If the Average Market Price of Hibernia Common Stock is less
than $7.75, the Exchange Rate will be increased so that each
share of First State Common Stock will be converted into that
number of shares of Hibernia Common Stock equal to (a)
$25,962,500, (b) divided by the Average Market Price of Hibernia
Common Stock, (c) divided by 100,000. If the Average Market
Price of Hibernia Common Stock is greater than $9.75, the
Exchange Rate will be decreased so that each share of First State
Common Stock will be converted into that number of shares of
Hibernia Common Stock equal to (a) $32,662,500, (b) divided by
the Average Market Price of Hibernia Common Stock, (c) divided by
100,000. For purposes of these adjustments, the "Average Market
Price" of Hibernia Common Stock is the average of the mean of the
high and low prices of one share of Hibernia Common Stock for the
five business days preceding the last trading day immediately
prior to the closing date of the Merger (the "Closing Date"), as
reported in the Wall Street Journal.
The Exchange Rate may be increased if the Merger is not
consummated on or before May 31, 1995. Further adjustments may
be made to the Exchange Rate if Hibernia executes, prior to the
Effective Date, an agreement to merge with an unaffiliated third
party in a transaction in which Hibernia will be not be the
surviving holding company. See "Proposed Merger -- Terms of the
Merger."
Management and Operations After the Merger
After the Effective Date, the offices of First State will be
operated as branch banking offices of HNB, and the directors of
First State will resign their positions as directors. See
"Proposed Merger -- Management and Operations After the Merger."
Recommendation of the Board of Directors
The Board of Directors of First State (the "First State
Board") has unanimously approved the Agreement, believes that the
Merger is in the best interests of the shareholders and
recommends that the shareholders vote FOR the Merger. Having
received the advice of its financial advisor, Austin Associates,
Inc. ("Austin Associates"), the First State Board further
believes that the basis specified in the Agreement for the
exchange of shares of First State Common Stock for shares of
Hibernia Common Stock is a fair basis for effecting the Merger
and will afford First State shareholders the opportunity to
continue as equity participants with a more liquid investment in
a strong statewide banking organization. The First State Board
also believes that the Merger will provide expanded product and
service capabilities to the customers of First State and will
enable the combined entity to compete more effectively with other
commercial banks and financial institutions in the region. See
"Proposed Merger -- Background of and Reasons for the Merger."
Basis for the Terms of the Merger
A number of factors were considered by the First State Board
in approving the terms of the Merger, including, without
limitation, information concerning the financial condition,
results of operations and prospects of Hibernia, HNB, and First
State; the ability of the combined entity to compete in the
relevant banking markets; the market price of Hibernia Common
Stock; the absence of an active trading market for the First
State Common Stock; the anticipated tax-free nature of the Merger
to First State shareholders for federal income tax purposes; the
financial terms of other business combinations in the banking
industry; and certain non-monetary factors. See "Proposed Merger
- -- Background of and Reasons for the Merger."
Advice and Opinion of Investment Advisor
Austin Associates, First State's financial advisor, has
rendered both oral and written opinions that the terms of the
Merger are fair, from a financial point of view, to First State
and its shareholders. A copy of the opinion of Austin Associates
is attached hereto as Appendix B, and should be read in its
entirety. See "Proposed Merger -- Opinion of Financial Advisor"
for further information regarding, among other things, the
selection of such firm and its compensation in connection with
the Merger.
Vote Required
Approval of the Agreement requires the affirmative vote of
the holders of two-thirds of the outstanding shares of First
State Common Stock. Directors and executive officers of First
State and the affiliates of such persons have voting power with
respect to 45,999 shares of First State Common Stock,
representing approximately 46% of the First State Common Stock
outstanding as of October 11, 1994. The directors of First State
have agreed to vote their stock in favor of the Merger, unless
they are legally required to abstain from voting or to vote
against the Merger. See "Meeting Information -- Vote Required."
Other Pending Merger Transactions for Hibernia
In addition to First State, Hibernia has entered into
definitive merger agreements with three other financial
institutions, Pioneer, American Bank and STABA. Each of these
proposed transactions are subject to certain conditions, similar
to the conditions to the Merger described herein. These
transactions may be consummated before or after consummation of
the Merger. Shareholders of First State will not have the right
to vote on any of the other pending transactions. In addition,
if the Merger is consummated prior to consummation of any or all
of the other transactions, former shareholders of First State who
have not exercised and perfected dissenters' rights will be
shareholders of Hibernia at the time those transactions are
consummated. Shareholders of Hibernia do not have the right to
vote on any of the pending merger transactions.
The table below includes certain information concerning
Pioneer, American Bank and STABA as of June 30, 1994. Further
information concerning the effects of the proposed merger
transactions, including complete pro forma financial information,
is included herein under "Pro Forma Financial Information." All
information included in the following table is as of June 30,
1994, and all percentages are percentages of Hibernia combined
with Pioneer, American Bank and STABA (including the effect of
the four mergers closed in the third quarter of 1994).
Name Deposits Deposits Assets Assets Shareholders' Equity
as % of as % of Equity as %
Total Total Total
Pioneer $324 million 5.85% $366 million 5.73% $ 29.1 million 5.28%
American
Bank $84.9 million 1.53% $ 94 million 1.47% $ 7.8 million 1.42%
STABA $87.5 million 1.58% $ 95 million 1.49% $ 7.4 million 1.34%
On a pro forma basis, as of June 30, 1994, the book value of
the shares of Hibernia Common Stock would be slightly decreased
by the pending transactions. The effect of the Merger on the
book value of Hibernia Common Stock, as well as First State
Common Stock, is shown under "Comparative Per Share Information"
included elsewhere herein.
Conditions; Abandonment; Amendment
Consummation of the Merger is subject to the satisfaction of
a number of conditions, including approval of the Agreement and
the Merger by the shareholders of First State and by the OCC.
Applicable law provides that the Merger may not be consummated
until at least 30, but no more than 180, days after approval of
the OCC is obtained. Hibernia filed an application for approval
of the OCC on October 3, 1994. See "Representations and
Warranties; Conditions to the Merger; Waiver" and "Regulatory
Approvals" under "Proposed Merger."
Substantially all of the conditions to consummation of the
Merger (except for required shareholder and regulatory approvals)
may be waived at any time by the party for whose benefit they
were created, and the Agreement may be amended or supplemented at
any time by written agreement of the parties, except that no such
waiver, amendment or supplement executed after approval of the
Agreement by First State's shareholders may change the Exchange
Rate. In addition, the Agreement may be terminated, either
before or after shareholder approval, under certain
circumstances. See "Representations and Warranties; Conditions
to the Merger; Waiver" and "Effective Date of the Merger;
Termination" under "Proposed Merger."
Interests of Certain Persons in the Merger
The terms of the Merger include certain benefits for
employees and management of First State, including employment
agreements for Messrs. Mike Cassidy, Kenneth Smith, Nathan Bush,
Earl Herrington and Robert Puckett, and indemnification of
officers, directors and employees of First State for certain
liabilities, up to certain aggregate limitations. See "Proposed
Merger -- Interests of Certain Persons in the Merger."
Employee Benefits
The Agreement provides that Hibernia will offer to all
employees of First State who are employed as of the Effective
Date and who become employees of Hibernia or HNB after the
Merger, the same employee benefits as those offered by Hibernia
and HNB to their employees, except that employees of First State
will not be required to wait for any period in order to be
eligible to participate in Hibernia's Flex Plan (including its
medical and dental coverage). Hibernia will also give First
State employees who become Hibernia employees full credit for
their years of service (for both eligibility and vesting) with
First State for purposes of Hibernia's 401(k) plan and the
Retirement Security Plan. Hibernia has also agreed to pay or
provide certain other benefits. See "Proposed Merger -- Employee
Benefits."
Certain Material Income Tax Consequences
It is a condition to consummation of the Merger that the
parties receive an opinion of a public accounting firm to the
effect that the Merger, when consummated in accordance with the
terms of the Agreement, will constitute a reorganization within
the meaning of Section 368(a) of the Internal Revenue Code of
1986, as amended (the "Code"), and that the exchange of First
State Common Stock for Hibernia Common Stock will not give rise
to the recognition of gain or loss for federal income tax
purposes to the First State shareholders and that the Louisiana
income tax treatment to the shareholders of First State will be
substantially the same as the federal income tax treatment to the
shareholders of First State. The parties have received the
opinion of Ernst & Young LLP, certified public accountants, to
the effects set forth above. The full text of the opinion is
included herein as Appendix C. See "Proposed Merger -- Material
Tax Consequences."
Because of the complexities of the federal income tax laws
and because the tax consequences may vary depending upon a
holder's individual circumstances or tax status, it is
recommended that each shareholder of First State consult his or
her tax advisor concerning the federal (and any applicable state,
local or other) tax consequences of the Merger to him or her.
Dissenters' Rights
Under the applicable federal laws governing mergers
involving national banks such as HNB, each holder of First State
Common Stock who objects to the Merger is entitled to the rights
and remedies of dissenting shareholders in accordance with the
applicable provisions of La. R.S. 6:376. The relevant provisions
of both federal and state law on dissenters' rights are attached
hereto as Appendix D. If dissenters' rights are exercised and
perfected with respect to 10% or more of the outstanding shares
of First State Common Stock, Hibernia has the option to abandon
the Merger because the Merger could not be accounted for as a
pooling of interests. It is expected that Hibernia would abandon
the Merger in that case. See "Rights of Dissenting Shareholders"
and "Proposed Merger -- Accounting Treatment."
Differences in Shareholders' Rights
Upon completion of the Merger, shareholders of First State,
to the extent they receive shares of Hibernia Common Stock in the
Merger, will become shareholders of Hibernia and their rights as
such will be governed by Hibernia's Articles of Incorporation and
Bylaws. The rights of shareholders of Hibernia are different in
certain respects from the rights of shareholders of First State.
See "Proposed Merger -- Certain Differences in Rights of
Shareholders."
Accounting Treatment
The parties intend the Merger to be treated as a pooling of
interests for financial accounting purposes. If, among other
things, holders of more than 10% of the outstanding shares of
First State Common Stock exercise and perfect dissenters' rights,
the Merger will not qualify for the pooling of interests method
of accounting, and Hibernia will not be obligated to effect the
Merger. See "Proposed Merger -- Accounting Treatment."
MEETING INFORMATION
Each copy of this Proxy Statement mailed to holders of First
State Common Stock is accompanied by a proxy card furnished in
connection with the First State Board's solicitation of proxies
for use at the Special Meeting and at any adjournments or
postponements thereof. The Special Meeting is scheduled to be
held at 4:15 p.m. on Thursday, December 15, 1994, at the main
office of First State, 346 Columbia Street, Bogalusa, Louisiana.
Only holders of record of First State Common Stock at the close
of business on the Record Date are entitled to receive notice of
and to vote at the Special Meeting. At the Special Meeting
shareholders will consider and vote upon (a) a proposal to
approve the Agreement, and (b) such other matters as may properly
be brought before the Special Meeting or any adjournments or
postponements thereof.
HOLDERS OF FIRST STATE COMMON STOCK ARE REQUESTED TO
COMPLETE, DATE AND SIGN THE ACCOMPANYING PROXY CARD AND RETURN IT
PROMPTLY TO FIRST STATE IN THE ENCLOSED, POSTAGE PAID ENVELOPE.
Any holder of First State Common Stock who has delivered a
proxy may revoke it any time before it is voted by attending the
Special Meeting and voting in person, or by giving notice of
revocation in writing or submitting a signed proxy card bearing a
later date to First State, at the main office, 346 Columbia
Street, Bogalusa, Louisiana 70427-3967, Attention: Robert J.
Puckett, at or before the Special Meeting. The shares of First
State Common Stock represented by properly executed proxy cards
received at or prior to the Special Meeting and not subsequently
revoked will be voted as directed by the shareholders submitting
such proxies. If instructions are not given, executed proxy
cards received by First State will be voted FOR approval of the
Agreement. If any other matters are properly presented at the
Special Meeting for consideration, the persons named in the proxy
card enclosed herewith will have discretionary authority to vote
on such matters in accordance with their best judgment. The
First State Board is unaware of any matter to be presented at the
Special Meeting other than the proposal to approve the Agreement.
The cost of soliciting proxies from holders of First State
Common Stock will be borne by First State. Such solicitation
will be made by mail but also may be made by telephone or in
person by the directors, officers and employees of First State
(who will receive no additional compensation for doing so). In
addition, First State will make arrangements with brokerage firms
and other custodians, nominees and fiduciaries to send proxy
materials to their principals.
FIRST STATE SHAREHOLDERS SHOULD NOT FORWARD ANY STOCK
CERTIFICATES WITH THEIR PROXY CARDS. IF THE MERGER IS APPROVED,
SHAREHOLDERS WILL RECEIVE INSTRUCTIONS REGARDING THE EXCHANGE OF
THEIR STOCK CERTIFICATES AFTER THE MERGER HAS BEEN CONSUMMATED.
Vote Required
The affirmative vote of the holders of two-thirds of the
shares of First State Common Stock is required in order to
approve the Agreement. As of the Record Date, there were 100,000
shares of First State Common Stock outstanding and entitled to
vote at the Special Meeting, with each share being entitled to
one vote.
A majority of the outstanding shares entitled to vote at the
Special Meeting constitutes a quorum for purposes of such
meeting. An abstention will be considered present for quorum
purposes, but will have the same effect as a vote against the
proposal to approve the Agreement.
As of the date of this Proxy Statement, the directors and
executive officers of First State and the affiliates of such
persons beneficially owned a total of 45,999 shares, or
approximately 46% of the outstanding shares of First State Common
Stock. The directors of First State have agreed to vote their
stock in favor of the Merger, unless they are legally required to
abstain from voting or to vote against the Merger.
As of October 11, 1994, neither Hibernia nor HNB, nor any of
their directors, executive officers or affiliates, beneficially
owned any shares of First State Common Stock.
Recommendation
For the reasons described below, the First State Board has
unanimously approved the Agreement, believes the Merger is in the
best interests of First State and its shareholders and recommends
that shareholders of First State vote FOR approval of the
Agreement. In making its recommendation to shareholders, the
First State Board considered, among other things, the opinion of
First State's financial advisor, Austin Associates, that the
terms of the Agreement are fair to First State shareholders from
a financial point of view. See "Background of and Reasons for
the Merger" and "Opinion of Financial Advisor" under "Proposed
Merger."
PROPOSED MERGER
This section of the Proxy Statement describes certain
aspects of the Merger and the Agreement. The following
description does not purport to be complete and is qualified in
its entirety by reference to the Agreement, which is attached as
Appendix A to this Proxy Statement and is incorporated herein by
reference. All shareholders are urged to read the Agreement
carefully and in its entirety.
Background of and Reasons for the Merger
Background. In late 1993 and early 1994, First State was
contacted by several regional bank holding companies seeking to
discuss the possibility of a merger or acquisition. Since early
1993, several Louisiana community banks announced their intention
to merge with larger, regional bank holding companies. Prices
paid in these transactions led the First State Board to seriously
consider the possibility of a merger or acquisition transaction.
On March 16, 1994, the First State Board engaged the
financial institution consulting firm of Austin Associates to
assist First State in determining its value and, based upon a
satisfactory result of that project, to assist in the
solicitation of offers. Representatives of Austin Associates
worked directly with Mr. Charles J. Cassidy, Mr. Charles M.
(Mike) Cassidy and Mr. Nathan W. Bush, acting as a special
committee of the First State Board.
On April 14, 1994, representatives of Austin Associates
presented the results of its independent appraisal to the special
committee. Based upon the results of that appraisal and the
announced prices of recent bank acquisition transactions in
Louisiana, Austin Associates was instructed to proceed with the
solicitation of offers.
The special committee then reviewed a list of thirty-five
potential purchasers located in eleven states in the southwestern
and southeastern regions of the United States. Formal contact
was made with twenty-seven of the institutions by Austin
Associates in early May of 1994. Confirmation of interest in the
proposed transaction was received from eight of the contacted
institutions. Thereafter, Austin Associates provided information
about First State to each of the potential purchasers to assist
them in formulating offers for First State.
The deadline for submitting proposals for a proposed
transaction was June 2, 1994 at which time four proposals were
received. On June 8, 1994, the special committee reviewed the
terms and conditions of each of the proposals, and the analysis
and recommendations provided by Austin Associates. It was
determined that the highest bidders would be invited to conduct a
due diligence review of the books and records of First State,
while the remaining bidders would be asked to reconsider their
offers. During the remainder of June, 1994, due diligence
reviews were conducted by the two highest bidders.
By July 15, 1994, Austin Associates had confirmed the status
of each initial proposal, which included the receipt of a revised
proposal from Hibernia.
On August 9, 1994, Austin Associates and the special
committee presented the final results of the offer solicitation
process to the First State Board. The First State Board reached
its final decision to accept the Hibernia proposal on August 15,
1994.
In reaching its decision to recommend the Agreement to its
shareholders, the First State Board considered, among other
things, the information presented to it by Austin Associates
regarding the value of First State, the value of the Hibernia
offer, the prices paid in recently announced bank acquisitions in
the State of Louisiana, the financial performance and condition
of Hibernia and the financial performance and condition of First
State.
Based on the foregoing, the Board of Directors of First
State unanimously approved the Agreement on August 15, 1994.
Accordingly, the First State Board unanimously recommends that
the shareholders vote FOR the proposal to approve the Agreement.
Reasons for the Merger. In reaching its determination that
the Merger and Agreement are fair to, and in the best interests
of, First State and its shareholders, the First State Board
consulted with its advisors, as well as with First State
management, and considered a number of factors, including,
without limitation, the following:
(a) the First State Board's familiarity with, and review of,
Hibernia's business, operations, earnings, and financial
condition;
(b) the condition contained in the Agreement that First
State shall have received the opinion of Austin Associates that
the terms of the Merger are fair to the First State shareholders
from a financial point of view (see "Opinion of Financial
Advisor");
(c) the First State Board's belief that the terms of the
Agreement are attractive in that the Agreement allows First State
shareholders to become shareholders of Hibernia, an institution
which is the second largest bank holding company headquartered in
Louisiana and whose stock is traded on the NYSE, and the recent
earnings performance of Hibernia;
(d) Hibernia's wide range of banking products and services;
(e) the First State Board's belief, based upon an analysis
of the anticipated financial effects of the Merger, that upon
consummation of the Merger, Hibernia and its banking subsidiaries
would be well capitalized institutions, the financial position of
which would be well in excess of all applicable regulatory
capital requirements;
(f) the First State Board's belief that, in light of the
reasons discussed above, HNB was the most attractive choice as a
long-term affiliation partner of First State;
(g) the expectation that the Merger will generally be a
tax-free transaction to First State and its shareholders and that
the Merger will be accounted for under the pooling of interests
method of accounting (see "Material Tax Consequences" and
"Accounting Treatment," below);
(h) the current and prospective economic and regulatory
environment and competitive constraints facing the banking
industry and financial institutions in First State's market area;
and
(i) the recent business combinations involving financial
institutions, either announced or completed, during the past year
in the United States, the State of Louisiana and contiguous
states and the effect of such combinations on competitive
conditions in First State's market area.
The First State Board did not assign any specific or
relative weight to the foregoing factors in their considerations.
Based on the foregoing, the First State Board concluded that
the proposed Merger would be in the best interests of First State
and its shareholders, employees, customers and communities
served. Accordingly, the First State Board unanimously
recommends that the shareholders vote FOR the Merger. For
information regarding interests of directors and executive
officers of First State in the Merger and their beneficial
ownership of First State Common Stock, see "Management and
Operations After the Merger" and "Interests of Certain Persons in
the Merger," below and "Beneficial Ownership of Directors,
Executive Officers and Principal Shareholders of First State."
Terms of the Merger
On the Effective Date, each outstanding share of First State
Common Stock (other than shares held by dissenting shareholders)
will be converted into 33.5 shares of Hibernia Common Stock,
subject to adjustment under the three types of circumstances
described below. For purposes of calculating the adjustments,
the term "Average Market Price" is defined as the average of the
high and low trading prices of Hibernia Common Stock for the five
trading days preceding the last trading day immediately prior to
the Closing Date, as published in the Wall Street Journal, or if
the Hibernia Common Stock is not then so reported, the average of
the fair market values of one share of Hibernia Common Stock on
the five business days preceding the Effective Date determined
pursuant to such reasonable method as Hibernia may determine.
If the Average Market Price is less than $7.75, the Exchange
Rate will be adjusted upward so that each share of First State
Common Stock will be converted into that number of shares of
Hibernia Common Stock equal to (a) $25,962,500, (b) divided by
the Average Market Price, (c) divided by 100,000. If the Average
Market Price is greater than $9.75, the Exchange Rate will be
adjusted downward so that each share of First State Common Stock
will be converted into that number of shares of Hibernia Common
Stock equal to (a) $32,662,500, (b) divided by the Average Market
Price, (c) divided by 100,000.
If the Merger is not consummated on or before May 31, 1995,
then the Exchange Rate (as it may have been adjusted in
accordance with the previous paragraph) will be increased by a
number of shares of Hibernia Common Stock calculated as follows:
(a) the net, after-tax earnings of First State for each month
ending after May 31, 1995, (b) divided by the Average Market
Price, (c) divided by 100,000.
If Hibernia executes, prior to the Effective Date, an
agreement to merge with an unaffiliated third party in a
transaction in which Hibernia will not be the surviving holding
company, then the Exchange Rate shall be calculated as set forth
above, except that, if the Average Market Price of Hibernia
Common Stock is greater than $9.75, the minimum number of shares
to be issued in the Merger, regardless of the actual Average
Market Price, shall be 2,696,318.
The conversion of shares of First State Common Stock to
Hibernia Common Stock shall be automatic, and First State
shareholders will automatically be entitled to all of the rights
and privileges afforded to Hibernia shareholders as of the
Effective Date.
No fractional shares of Hibernia Common Stock will be issued
in connection with the Merger. In lieu of fractional shares,
Hibernia will make a cash payment equal to the fractional
interest which a First State shareholder would otherwise receive
multiplied by the Average Market Price of Hibernia Common Stock,
and no such holder shall be entitled to dividends, voting rights
or any other right of shareholders in respect of any fractional
share. If, prior to the Effective Date the outstanding shares of
Hibernia Common Stock are increased, decreased, changed into or
exchanged for a different number or class of shares or securities
through a change in Hibernia's capitalization, then the number of
shares to be issued in the Merger will be adjusted accordingly.
The receipt of cash in lieu of fractional shares will not
adversely affect the tax-free nature of the exchange of common
stock in the Merger. See "Material Tax Consequences," below.
For a discussion of the rights of dissenting shareholders,
see "Rights of Dissenting Shareholders."
Opinion of Financial Advisor
First State retained the financial consulting firm of Austin
Associates as financial advisor in connection with the proposed
transaction. On August 9, 1994, Austin Associates orally advised
the First State Board that the terms of the Merger provided fair
consideration to First State shareholders. Austin Associates
subsequently delivered to the First State Board its written
opinion dated October 14, 1994 that, based on the matters set
forth therein, the terms of the Merger are fair to First State
and its shareholders from a financial point of view. A copy of
Austin Associates' opinion is set forth as Appendix B to this
Proxy Statement and should be read in its entirety.
Austin Associates, as part of its financial institution
consulting business, is routinely engaged in the valuation of
banks and other financial institutions and their securities in
connection with mergers and acquisitions and other transactions.
First State retained Austin Associates on the basis of its
reputation and its experience in evaluating financial
institutions and in representing community banks in merger
transactions.
Austin Associates directly participated in the negotiations
on behalf of First State. Although Austin Associates advised
First State as to the value of the institution, the terms of the
Merger, including the consideration to be received in the Merger,
were determined by First State and Hibernia after arms-length
negotiations between the parties.
In rendering its opinion, Austin Associates reviewed and
analyzed, among other things: (1) this Proxy Statement; (2) the
financial statements of First State and Hibernia for the period
1990 through June of 1994; (3) certain other publicly available
and internal operating information of First State, consisting of
data reviewed in connection with the preliminary appraisal of
First State as described below; (4) certain other publicly
available information on Hibernia, including the independent
analyst research reports and the financial terms of recently
announced Hibernia acquisitions; (5) publicly available
information regarding the performance of certain other banks
whose business activities are believed to be generally comparable
to those of First State, as provided in First States' Uniform
Bank Performance Report which includes peer group performance
ratios; (6) publicly available information regarding the
performance of various bank holding companies in Louisiana and
Mississippi, including First Commerce Corporation, Premier
Bancorp, Inc., Whitney Holding Corporation, Deposit Guaranty
Corporation, Trustmark Corporation and Hancock Holding Company;
(7) the financial terms, to the extent publicly available, of
selected sale transactions involving commercial banking
organizations in Louisiana and other states from 1993 to present;
and (8) Austin Associates' experience with respect to bank merger
transactions which provides insights into the unique aspects of
any one particular transaction, thus influencing its conclusion
as to whether a transaction is fair from a financial point of
view.
In connection with rendering its opinion, Austin Associates
performed a variety of financial analyses, which are summarized
below. Austin Associates believes its analyses must be
considered as a whole and that selected portions of such analyses
and the factors considered therein, without considering all
factors and analyses, could create an incomplete view of the
analyses and the process underlying Austin Associates' opinion.
The preparation of a fairness opinion is a complex process
involving subjective judgments and is not necessarily susceptible
to partial analyses or summary description. In it analyses,
Austin Associates made numerous assumptions with respect to
industry performance, business and economic conditions, and other
matters, many of which are beyond First State's or Hibernia's
control. Any estimates contained in Austin Associates analyses
are not necessarily indicative of future results or values, which
may be significantly more or less favorable than the estimates.
Preliminary Appraisal of First State. Austin Associates
completed a preliminary appraisal of First State, which was
presented to the special committee of the First State Board on
April 14, 1994. Austin Associates estimated that a reasonable
sale of control value for First State would be equal to
approximately $30 million, or approximately $300 per share, as of
December 31, 1994.
The Nature of the Process for Soliciting Indications of
Interest from Other Bank Holding Companies. Through Austin
Associates, First State contacted twenty-seven potential
acquirors and provided a confidential information package to
eight of those commercial banking organizations. Of the eight
organizations provided information, four submitted specific
proposals to acquire First State, and each proposal was
negotiated. The proposal by Hibernia provided the highest
consideration for First State shareholders.
Analysis of Selected Merger Transactions. In determining
whether the financial terms offered by Hibernia for First State
are fair, from a financial point of view, to the shareholders of
First State, Austin Associates reviewed a comparison of prices
paid in recently announced sale of control transactions in the
southwest for banks having assets of between $100 and $800
million. Austin Associates reviewed eighteen transactions
announced between February of 1993 and February of 1994 for
commercial banking companies headquartered in the states of
Louisiana, Texas, New Mexico, Arkansas and Oklahoma. The
eighteen transactions have a median price to book value ratio of
186 percent and a price to earnings multiple of 12.7 times.
Additionally, Austin Associates reviewed thirteen recently
announced transactions involving Louisiana banks between February
and August of 1994. These transactions have a median price to
book value ratio of 232 percent and a price to earnings multiple
of 13.4 times. The market value of the terms of the Merger
ranges from $26.0 million to $32.7, with a midpoint of $29.3
million. The $29.3 million midpoint corresponds to 145 percent
of First State's June 30, 1994 equity capital and 16.2 times
trailing twelve month net income.
Consideration of First State's Excess Capital. The price to
book value ratios noted in the preceding paragraph are somewhat
misleading due to the presence of excess capital at First State.
As of June 30, 1994, First State had total equity of $20.0
million and total assets of $149.7 million, for a leverage ratio
of 13.4 percent. Assuming a leverage ratio of 7.0 percent, First
State would have required capital of $10.5 million, and excess
capital of $9.5 million. The $29.3 million midpoint of the value
of the financial terms of the Merger represents a premium of $9.3
million over the June 30, 1994 actual equity capital of First
State. This premium represents a 88.6 percent premium over book
value using the 7.0 percent leverage ratio assumption.
Contribution Analysis. Austin Associates compared the pro
forma ownership interest in Hibernia that First State
shareholders would receive, in the aggregate, to the contribution
by First State to the total assets, equity and net income in the
combined organization. As of June 30, 1994, First State
shareholders would own approximately 3.03 percent of the combined
organization, while First State's contribution of total assets
would equal 2.34 percent, the contribution of total equity would
equal 3.68 percent, and the contribution of year-to-date June 30,
1994 net income would have equaled 1.46 percent. These measures
reflect the effect of Hibernia's consummated and pending
acquisitions.
Dilution Analysis. The pro forma effect to First State's
year-to-date earnings per share resulting from the Merger are
positive, while the pro forma effect to book value per share is
negative. Through June 30, 1994 First State recorded earnings
per share of $5.95, and book value equaled $200.28 per share.
Assuming the Merger was consummated on June 30, 1994, the
equivalent First State earnings per share would have equaled
$12.40, an increase of 108 percent over actual results, while
book value per share would have decreased to $164.49 per share, a
decrease of 18 percent from actual book value. These measures
also reflect the effect of Hibernia's pending acquisitions.
The summary set forth above does not purport to be a
complete description of the analyses performed by Austin
Associates. Further, Austin Associates did not conduct a
physical inspection of any of the properties or assets of First
State or Hibernia. Austin Associates has assumed and relied upon
the accuracy and completeness of the financial and other
information provided to it or publicly available, has relied upon
the representations and warranties of First State and Hibernia
made pursuant to the Agreement, and has not independently
attempted to verify any of such information. Austin Associates
has also assumed that the conditions to the Merger as set forth
in the Agreement would be satisfied and that the Merger would be
consummated on a timely basis in the manner contemplated by the
Agreement. No limitations were imposed by First State or
Hibernia on Austin Associates regarding the scope of its
investigation nor were any specific instructions given to Austin
Associates in connection with its fairness opinion.
For Austin Associates' services as financial advisor in the
proposed transaction, First State will pay the firm a fee of
$50,000 plus a contingent amount equal to 1 percent of the
transaction value when the Merger is consummated. In addition,
First State has agreed to reimburse Austin Associates for
reasonable out-of-pocket expenses and indemnify Austin Associates
against certain liabilities, including liabilities under the
securities laws.
Surrender of Certificates
As soon as practicable after the Effective Date, the
transfer agent of Hibernia, in its capacity as exchange agent,
will mail all non-dissenting shareholders of First State a letter
of transmittal, together with instructions for the exchange of
their First State Common Stock certificates for certificates
representing Hibernia Common Stock. Until so exchanged, each
certificate representing First State Common Stock outstanding
immediately prior to the Effective Date shall be deemed for all
purposes to evidence ownership of the number of shares of
Hibernia Common Stock into which such shares have been converted
on the Effective Date. Shareholders should not send their First
State Common Stock certificates for surrender until they receive
further instructions from the exchange agent.
First State shareholders who cannot locate their First State
stock certificates are encouraged to contact Robert J. Puckett,
Secretary, at 346 Columbia Street, Bogalusa, Louisiana 70427-
3967, telephone number (504) 732-3633, prior to the Special
Meeting. New certificates will be issued to First State
shareholders who have misplaced their certificates only if the
shareholder executes an affidavit certifying that the certificate
cannot be located and agreeing to indemnify First State and
Hibernia (as its successor), against any claim that may be made
against either of them by any person claiming to own any or all
of the shares represented by the lost certificate(s). First
State or Hibernia (as its successor) may require a shareholder to
post a bond in an amount sufficient to support the shareholder's
indemnification obligation. Shareholders who have misplaced
their stock certificates and shareholders who hold certificates
in names other than their own are encouraged to resolve those
matters prior to the Effective Date of the Merger in order to
avoid delays in receiving their Hibernia Common Stock if the
Merger is approved and consummated.
Representations and Warranties; Conditions to the Merger; Waiver
The Agreement contains representations and warranties by
First State regarding, among other things, its organization,
authority to enter into the Agreement, capitalization,
properties, financial statements, pending and threatened
litigation, contractual obligations and contingent liabilities.
The Agreement also contains representations and warranties by
Hibernia regarding, among other things, its organization and
authority to enter into the Agreement, capitalization, financial
statements and other public reports. Except as otherwise
provided in the Agreement, these representations and warranties
will not survive the Effective Date.
The obligations of Hibernia and First State to consummate
the Merger are conditioned upon, among other things, approval of
the Agreement by First State's shareholders; the receipt of
necessary regulatory approvals, including the approval of the OCC
without any materially burdensome conditions; the receipt of an
opinion to the effect that the Merger, when consummated in
accordance with the terms of the Agreement, will constitute a
reorganization within the meaning of Section 368(a) of the Code
and that, to the extent First State Common Stock is exchanged for
Hibernia Common Stock, First State's shareholders will recognize
no gain or loss for federal income tax purposes with respect to
such exchange; the effectiveness under the Securities Act of a
registration statement relating to the Hibernia Common Stock to
be issued in connection with the Merger and the absence of a stop
order suspending such effectiveness; the absence of an order,
decree or injunction enjoining or prohibiting the consummation of
the Merger; the receipt of all required state securities law
permits or authorizations; the accuracy of the representations
and warranties set forth in the Agreement as of the Closing Date;
the listing of the Hibernia Common Stock to be issued in the
Merger on the NYSE; the receipt of certain opinions of counsel;
in the case of First State, the receipt of the fairness opinion
of Austin Associates and, in the case of Hibernia, the absence of
an event that would preclude the Merger from being accounted for
as a pooling of interests.
Except with respect to any required shareholder or
regulatory approval, substantially all of the conditions to
consummation of the Merger may be waived at any time by the party
for whose benefit they were created, and the Agreement may be
amended or supplemented at any time by written agreement of the
parties, except that no such waiver, amendment or supplement
executed after approval of the Agreement by First State's
shareholders shall change the Exchange Rate.
Regulatory Approvals
In addition to approval of the shareholders of First State,
consummation of the Merger will require the approval of the OCC.
Hibernia filed an application seeking the approval of the Merger
with the OCC on October 3, 1994. Hibernia expects to receive
such approval prior to the Special Meeting; however, there can be
no assurance that such approval will be obtained by that time or
at all.
After the approval of the OCC has been obtained, First State
and HNB must wait at least 30 days before consummating the
Merger. During this 30-day period, the Department of Justice may
object to the Merger on antitrust grounds.
Business Pending the Merger
Under the terms of the Agreement, First State may not,
without the prior written consent of Hibernia or as otherwise
provided in the Agreement, among other things: (i) create or
issue any additional shares of capital stock or any options or
other rights to purchase or acquire shares of capital stock; (ii)
except with respect to Messrs. Mike Cassidy, Kenneth Smith,
Nathan Bush, Earl Herrington and Robert Puckett, enter into
employment contracts with directors, officers or employees of
First State or otherwise agree to increase the compensation of or
pay any bonus to such persons other than in accordance with
existing policy; (iii) enter into or substantially modify any
employee benefits plans, other than with respect to the severance
policy permitted under the terms of the Agreement; (iv) establish
any automatic teller machines, branches or other banking offices;
(v) make any capital expenditures in excess of $100,000; (vi)
merge with any other company or bank or liquidate or otherwise
dispose of its assets; or (vii) acquire another company or bank
(except in connection with foreclosures related to bona fide loan
transactions). First State is also prohibited by the terms of
the Agreement from declaring or paying dividends prior to the
Effective Date; however, Hibernia has agreed to permit First
State, subject to certain conditions set forth in the Agreement,
to declare and pay annualized dividends of up to $1.00 per share
of First State Common Stock prior to the Closing.
Effective Date of the Merger; Termination
Unless otherwise mutually agreed upon by Hibernia and First
State, the Effective Date will occur on the later of: (i) the
first business day that falls 30 days after the date of the order
of the OCC approving the Merger; (ii) the first business day that
falls 5 days after the Special Meeting; or (iii) such later date
within 60 days of the Special Meeting as may be agreed upon by
the parties. After the Effective Date is determined, the OCC
will issue a letter declaring the Merger effective on such date.
The Agreement may be terminated by either party, whether
before or after approval of the Agreement by the First State
shareholders: (i) in the event of a material breach by the other
party of any representation, warranty or covenant which has not
been cured within the period allowed by the Agreement; (ii) if
any of the conditions precedent to the obligations of such party
to consummate the Merger have not been satisfied, fulfilled or
waived as of June 30, 1995; (iii) if any application for any
required regulatory approval has been denied, and the time for
all appeals of such denial has run; (iv) if the shareholders of
First State fail to approve the Merger at the Special Meeting;
(v) if there is a material adverse change in the financial
condition of either party; or (vi) if the Merger is not
consummated by June 30, 1995. The Agreement may also be
terminated by Hibernia if the Merger does not qualify for pooling
of interests accounting treatment or if the holders of more than
10% of the First State Common Stock exercise and perfect
dissenters' rights. The Agreement may be terminated by First
State if the employment agreements for Messrs. Cassidy, Smith,
Bush, Herrington and Puckett have not been executed and if First
State does not receive the Austin Associates fairness opinion.
The Agreement also may be terminated at any time by the mutual
consent of the parties. In the event of termination, the
Agreement shall become null and void, except that certain
provisions thereof relating to expenses and confidentiality and
the accuracy of information provided for inclusion in the
Registration Statement of which this Proxy Statement is a part
shall survive any such termination, and any such termination
shall not relieve any breaching party from liability for any
uncured breach of any covenant or agreement giving rise to such
termination.
Management and Operations After the Merger
On the Effective Date, First State will be merged with and
into HNB, and the separate existence of First State will cease.
The offices of First State will be operated as branch banking
offices of HNB. The employees of First State on the Effective
Date will become employees of HNB, and will be employed on an "at
will" basis thereafter, subject to any existing employment
agreements or similar contractual obligations assumed by
Hibernia.
The Boards of Directors of Hibernia and HNB following the
Merger shall consist of those persons serving as directors
immediately prior thereto. Information regarding the directors
of Hibernia elected at its annual meeting of shareholders on
April 26, 1994 is contained in documents incorporated herein by
reference. See "Available Information" and "Incorporation by
Reference." The directors of First State will resign their
positions as directors as of the Effective Date.
Certain Differences in Rights of Shareholders
If the shareholders of First State approve the Merger and
the Merger is subsequently consummated, all shareholders of First
State, other than any shareholders who exercise and perfect
dissenters' rights, will become shareholders of Hibernia. As
shareholders of Hibernia, their rights will be governed by and
subject to Hibernia's Articles of Incorporation and Bylaws,
rather than First State's Articles of Incorporation (First State
has not adopted Bylaws). The following is a summary of the
principal differences between the rights of shareholders of First
State and Hibernia not described elsewhere in this Proxy
Statement.
Shareholder Proposals. First State's Articles of
Incorporation do not contain any provision either expressly
forbidding or permitting a shareholder to submit a proposal for
consideration at a shareholders meeting. Hibernia's Bylaws
contain certain provisions expressly allowing shareholders to
submit a proposal and to nominate individuals for election as
directors only under certain circumstances and provided the
shareholder complies with all of the conditions set forth in
those provisions.
Establishing the Number of Directors. Hibernia's Bylaws
provide that the number of directors is set by the Bylaws, which
may be amended by a majority of the Board of Directors, thereby
giving a majority of the Board the authority to establish the
number of directors. First State's Articles provide that the
Board of Directors shall consist of not less than five nor more
than thirty members. Therefore, the shareholders of First State
can nominate and elect as many directors (between five and
thirty) as they choose, from time to time.
Terms of Directors. Hibernia's Board is divided into three
classes, each of which is elected for a three-year term. The
Directors of First State are elected for one-year terms.
Certain Transfer Restrictions Relating to Five Percent
Shareholders. The Articles of Incorporation of First State do
not restrict the transfer of First State Common Stock. With
respect to Hibernia, however, Article IX of Hibernia's Articles
of Incorporation restricts the transfer of equity interests in
Hibernia under certain circumstances. This restriction (the
"Five Percent Restriction") is intended to protect Hibernia from
certain transfers of equity interests that could have a material
adverse effect on Hibernia's ability to use certain tax benefits
to reduce its taxable income. Under the Five Percent
Restriction, if, before December 29, 1995, a shareholder
transfers or agrees to transfer Hibernia stock or stock
equivalents, the transfer will be prohibited and void to the
extent that it would result, under applicable Federal income tax
rules, in the identification of a new "five percent shareholder"
of Hibernia or an increase in the percentage stock ownership of
any existing "five percent shareholder."
The Five Percent Restriction does not apply to any transfer
that has been approved in advance by the Board of Directors of
Hibernia, or that is made in compliance with exceptions
established from time to time by resolution of the Board of
Directors. The Board of Directors may withhold its approval of a
transfer only if, in its judgment, the transfer may result in any
limitation on the use by Hibernia of its net operating loss
carryforwards or built-in tax losses or other tax attributes.
The Board of Directors may adopt further resolutions exempting
additional transfers from the Five Percent Restriction.
The Five Percent Restriction may adversely affect the
marketability of the Hibernia Common Stock by discouraging
potential investors from acquiring equity securities of Hibernia.
However, although the Five Percent Restriction may have the
effect of impeding a shareholder's attempt to acquire a
significant or controlling interest in Hibernia, the purpose of
the Five Percent Restriction is to preserve the tax benefits of
Hibernia's previous losses, not to insulate management from
change. Management of Hibernia believes the tax benefits
outweigh any anti-takeover impact of the Five Percent
Restriction. Any anti-takeover effect of the Five Percent
Restriction will end with the termination of the Five Percent
Restriction on December 29, 1995.
Indemnification of Officers and Directors. Hibernia's
Articles of Incorporation require that Hibernia indemnify the
directors and officers of Hibernia or any of its wholly-owned
subsidiaries, except as prohibited by law, against expenses,
judgments, fines and amounts paid in settlement actually and
reasonably incurred in connection with any action, suit or
proceeding, whether civil or criminal, administrative or
investigative (including any action by or in the right of
Hibernia) by reason of the fact that the person served as an
officer or director of Hibernia or one of its subsidiaries.
Officers and directors may only be indemnified against expenses
in cases brought by the officer or director against Hibernia if
the action is a claim for indemnification, the officer or
director prevails in the action, or indemnification is included
in any settlement or is awarded by the court. The
indemnification provision further requires Hibernia to advance
defense costs to officers and directors in such suits and
proceedings upon receipt of an undertaking to repay such expenses
unless it is ultimately determined that the officer or director
is entitled to indemnification as authorized by the Article.
The Articles of Incorporation of First State do not
expressly provide for the indemnification of officers and
directors. However, under the Louisiana Banking Laws, First Bank
may indemnify its officers, directors, employees and agents under
the circumstances permitted by the Louisiana Banking Laws, and
First State is required to indemnify a director who was wholly
successful, on the merits or otherwise, in the defense of any
proceeding to which he was made a party in his capacity as
director.
Assessability of Stock. Under the Louisiana Banking Laws,
shares of stock in a Louisiana bank, such as First State, may be
assessed under limited circumstances. Common stock of
corporations organized under the Louisiana Business Corporation
Law, such as Hibernia, is not assessable.
Liquidity of Stock. There currently is no market for shares
of First State Common Stock, and such a market is not likely to
develop in the future. Shares of Hibernia Common Stock are
listed for trading on the NYSE. Current quotes of the market
price of Hibernia Common Stock are available from brokerage firms
and other securities professionals, as well as other sources, and
are published in major newspapers on a daily basis. Shares of
Hibernia Common Stock to be issued in the Merger may be freely
resold by persons who are not "affiliates" of First State or
Hibernia. See "Resale of Hibernia Common Stock," below.
Interests of Certain Persons in the Merger
Indemnification of First State Directors. The terms of the
Merger include certain provisions that protect the officers and
directors of First State from and against liability for actions
arising while they served in those capacities for First State.
The Agreement provides for indemnification of such persons to the
same extent as they would have been indemnified under the
Articles of Association and Bylaws of HNB in effect on August 18,
1994, except that the Agreement limits Hibernia's aggregate
liability for such indemnification to $8 million and requires
each officer and director eligible for such indemnification to
execute a joinder agreement in which such persons agree to
cooperate with Hibernia in any litigation or proceeding giving
rise to a claim of indemnification. The indemnification
provisions of the Agreement do not apply to claims the existence
of which such person knew or should have known but failed to make
a good faith effort to require First State to notify its director
and officer liability insurance carrier of prior to Closing Date.
The Agreement also provides for indemnification of First
State's officers, directors and certain affiliates from and
against any liability arising under the Securities Act or
otherwise, if such liability arises out of or is based on an
untrue statement or omission of a material fact required to be
stated in the Registration Statement or necessary to make the
statements made therein not misleading. This indemnification
does not apply to statements made in reliance on information
furnished to Hibernia by First State for use in this Proxy
Statement.
Employment Agreements. Hibernia intends to enter into
employment agreements with Messrs. Mike Cassidy, Kenneth Smith,
Nathan Bush, Earl Herrington and Robert Puckett for a period of
two years at their current salaries. If these employment
agreements are not executed prior to the Closing Date, First
State has the right to terminate the Agreement.
Employee Benefits
The Agreement provides that Hibernia will use its best
efforts to cause to be provided to all employees of First State
who are employed as of the Effective Date and who become
employees of Hibernia or HNB after the Merger, the same employee
benefits as those offered by Hibernia and HNB to their employees,
except that employees of First State will not be required to wait
for any period in order to be eligible to participate in
Hibernia's Flex Plan (including its medical and dental coverage).
Hibernia will also give First State employees who become Hibernia
employees full credit for their years of service (for both
eligibility and vesting) with First State for purposes of
Hibernia's 401(k) plan and Hibernia's Retirement Security Plan.
First State maintains a profit-sharing plan for its
employees that is administered by First State and as to which
participation by eligible employees is automatic. Hibernia is
considering terminating this plan, which would allow participants
in the plan who became employees of Hibernia after the merger to
roll their account balances into Hibernia's 401(k) plan.
Alternatively, Hibernia may determine to merge the profit-sharing
plan into its 401(k) plan. In either of these events, former
employees of First State would be immediately vested as to the
balances of their retirement plan accounts.
Expenses
The Agreement provides that all expenses incurred in
connection with the negotiation and execution of the Agreement
and the consummation of the Merger will be borne by the party
that incurred them, regardless of whether the Merger is
consummated.
Material Tax Consequences
The following is a summary description of the material tax
consequences of the Merger to the shareholders of First State;
it is not intended to be a complete description of the federal
income tax consequences of the Merger. Tax laws are complex, and
each shareholder's individual circumstances may affect the tax
consequences to such shareholder. In addition, no information is
provided with respect to the tax consequences of the Merger under
applicable state, local or other tax laws. Each shareholder is
therefore urged to consult a tax advisor regarding the tax
consequences of the Merger to him or her.
Consummation of the Merger is conditioned upon the receipt
of an opinion to the effect that the Merger, when consummated in
accordance with the terms of the Agreement, will constitute a
reorganization within the meaning of Section 368(a) of the Code,
and that the exchange of First State Common Stock for Hibernia
Common Stock will not give rise to the recognition of gain or
loss for federal income tax purposes to First State's
shareholders. The parties have received the opinion of Ernst &
Young LLP, certified public accountants, to the foregoing
effects. A copy of such opinion is attached hereto as Appendix
C.
If the Merger constitutes a reorganization within the
meaning of Section 368(a) of the Code: (i) no gain or loss will
be recognized by First State, Hibernia or HNB by reason of the
Merger; (ii) a shareholder of First State will not recognize any
gain or loss for federal income tax purposes to the extent
Hibernia Common Stock is received in the Merger in exchange for
First State Common Stock; (iii) the tax basis in Hibernia Common
Stock received by a shareholder of First State will be the same
as the tax basis in the First State Common Stock surrendered in
exchange therefor; (iv) the holding period, for federal income
tax purposes, for Hibernia Common Stock received in exchange for
First State Common Stock will include the period during which the
shareholder held the First State Common Stock surrendered in the
exchange, provided that the First State Common Stock was held as
a capital asset at the Effective Date; and (v) cash received in
the Merger in lieu of fractional shares will not adversely affect
the income tax treatment of the exchange of shares, but will be
treated as a partial redemption of the shareholder's interest in
his stock and therefore will generally be subject to federal
income tax as a capital gain if the shareholder's basis in the
First State Common Stock is less than the price being paid by
Hibernia.
Cash payments received by dissenting shareholders will be
treated as a complete redemption of the shareholders' interests
in their First State Common Stock, and will generally be subject
to federal and state income tax as a capital gain. For more
information regarding the income tax consequences of cash
payments received by dissenting shareholders, see "Rights of
Dissenting Shareholders."
Resale of Hibernia Common Stock
The shares of Hibernia Common Stock to be exchanged for
First State shares in the Merger have been registered under the
Securities Act and have been approved for listing on the NYSE.
This registration permits the Hibernia shares to be freely
transferred by anyone who is not an "affiliate" of Hibernia after
the Merger and anyone who was not an "affiliate" of First State
prior to the Merger, within the meaning of Rule 145 under the
Securities Act. For the purposes of that rule, affiliates are
generally persons (including corporations and partnerships) that
control, are controlled by, or are under common control with
Hibernia or First State, as the case may be. Executive officers,
directors and 10% shareholders are typically considered
affiliates for these purposes.
Rule 145 imposes certain restrictions on the sale of stock
received in a merger or consolidation by an affiliate of the
acquired company, even if that person does not become an
affiliate of the acquiring company. Affiliates of First State
will only be permitted to resell any Hibernia shares received by
them in the Merger if they register those shares for resale or
they comply with the restrictions of Rule 145. Anyone who is or
may be an affiliate of First State should carefully consider the
resale restrictions imposed by Rule 145 before they attempt to
transfer any shares of Hibernia Common Stock received in the
Merger.
Each of the persons identified by First State as an
"affiliate" has executed an agreement in which those individuals
commit to transferring their Hibernia shares only in accordance
with the securities laws and in a manner that does not jeopardize
the treatment of the Merger as a pooling of interests for
accounting purposes. The pooling of interests accounting rules
will prohibit affiliates from transferring any Hibernia stock
received by them until Hibernia has published financial results
that include at least thirty days of operations after the
consummation of the Merger, which generally will occur in the
month following the fiscal quarter-end that follows the Effective
Date. In addition to the aforementioned agreements, Hibernia
intends to place stop transfer instructions with its transfer
agent with respect to shares of Hibernia Common Stock issued to
affiliates of First State.
Dividend Reinvestment Plan
Hibernia maintains a Dividend Reinvestment Plan through
which shareholders of Hibernia may reinvest dividends in Hibernia
Common Stock. Shares are purchased for participants in the plan
at their market value, which is determined by the market price of
Hibernia Common Stock on the NYSE. The plan also permits
participants to purchase additional shares with cash at the then-
current market price. All shares purchased through the plan are
held in a separate account for each participant and maintained by
Hibernia's transfer agent. Shareholders who participate in the
Dividend Reinvestment Plan purchase shares through the plan
without paying brokerage commissions or other costs ordinarily
associated with open market purchases of stock. It is
anticipated that the Dividend Reinvestment Plan will continue
after the Effective Date and that shareholders of First State who
become shareholders of Hibernia will have the same opportunity to
participate in the plan as other shareholders of Hibernia.
Accounting Treatment
It is anticipated that the Merger will be accounted for as a
"pooling of interests" transaction. Among other requirements, in
order for the Merger to qualify for pooling of interests
accounting treatment, 90% or more of the outstanding First State
Common Stock must be exchanged for Hibernia Common Stock.
Consequently, holders of more than 10% of the outstanding First
State Common Stock exercise and perfect dissenters' rights, the
Merger will not qualify for pooling of interests accounting.
Also, in order for the pooling of interests accounting method to
apply, "affiliates" of First State cannot reduce their holdings
of Hibernia Common Stock received in the Merger for a period
beginning on the Effective Date and ending upon the publication
of at least 30 days of post-Merger combined operations of First
State and HNB. Persons believed by First State to be
"affiliates" have agreed to comply with these restrictions. See
"Resale of Hibernia Common Stock," above.
First State has agreed to use its best efforts to permit the
transaction to be accounted for as a pooling of interests.
Hibernia is not obligated to consummate the Merger if the Merger
does not qualify for pooling of interests accounting treatment.
RIGHTS OF DISSENTING SHAREHOLDERS
Under the applicable federal laws governing mergers
involving national banks such as HNB, each shareholder of First
Bank who complies with the provisions of Section 376 of the
Louisiana General Banking Laws, La. R.S. 6:376, may dissent from
the Merger and be paid the fair cash value of his shares of First
State Common Stock as of the Effective Date, determined as
described below.
To exercise the right of dissent, a shareholder must file
with First State, prior to the Special Meeting, a written
objection to the Merger and must vote his shares against the
Merger. Notices of dissent should be addressed to Mr. Robert J.
Puckett, Secretary, First State Bank and Trust Company of
Bogalusa, 346 Columbia Street, Bogalusa, Louisiana 70427-3967.
If the Merger is effected, First State will send a notice to
each shareholder who filed an objection and voted his shares
against the Merger to such shareholder's last address on First
State's records. Within twenty days after the mailing of such
notice, but not thereafter, the shareholder may file with First
State a demand in writing for the fair cash value of his shares
as of the day before the Special Meeting. Such demand must
contain the value of the shares demanded and a post office
address to which a reply may be sent. At the same time, such
shareholder must deposit in escrow in a bank or trust company
located in Washington Parish, Louisiana the certificates
representing his shares on the sole condition that such shares
shall be delivered to First State upon payment of the fair cash
value in accordance with the Louisiana Banking Law. Together
with the shareholders' demand, such shareholder shall deliver to
First State the written acknowledgment of the escrow bank or
trust company that such bank or trust company holds the
shareholder's certificates.
Unless the objection, demand, and acknowledgment described
above are made and delivered by the shareholder within the period
described above, the shareholder shall be conclusively presumed
to have acquiesced to the Merger.
If First State disagrees with the value requested by a
shareholder it shall, within twenty days, notify the shareholder
of the value that First State will agree to pay if any payment
should be held to be due; otherwise First State shall be liable
for and pay the value demanded by the shareholder. In the case
of a disagreement as to the fair cash value, the shareholder may
file suit in the district court in the parish in which First
State or HNB is domiciled. The court will determine if payment
is due, and, if so, the fair cash value to be paid to the
shareholder. If First State, in its notice of disagreement, has
offered to pay the dissatisfied shareholder an amount in cash
deemed by it to be the fair cash value, and shall have deposited
such amount in the registry of the court, then, if the amount
ultimately awarded (exclusive of interest and costs) is more than
the amount so offered, the costs of the proceeding will be paid
by First State or HNB, as the case may be; otherwise, the costs
of the proceeding shall be paid by the dissatisfied shareholder.
THE FOREGOING SUMMARY OF THE PROVISIONS OF FEDERAL BANK
MERGER LAWS AND THE LOUISIANA BANKING LAW RELATING TO DISSENTERS'
RIGHTS IS NECESSARILY INCOMPLETE AND IS QUALIFIED IN ITS ENTIRETY
BY REFERENCE TO EXCERPTS FROM THE FEDERAL AND STATE BANKING LAWS
SET FORTH HEREIN AS APPENDIX D.
Shareholders of First State who exercise and perfect
dissenters' rights and who receive cash for their shares of First
State Common Stock will generally be subject to federal and state
income tax on all or a portion of the amount of cash received.
Furthermore, if the Merger is effected, the cash paid to
dissenting shareholders may be more or less than the value of the
Hibernia Common Stock issued to those shareholders of First State
who voted in favor of the Merger. The receipt of cash for shares
will be treated as a complete redemption of the shareholder's
interest in the stock and, depending on the individual
shareholder's circumstances, may result in a capital gain to him.
The tax opinion rendered by Ernst & Young LLP and attached hereto
as Appendix C states that payments to dissenting shareholders are
not exempt from federal or state income tax. Shareholders
desiring to dissent from the Merger are urged to consult their
tax advisors with regard to the tax implications to them of
exercising dissenters' rights.
PRO FORMA FINANCIAL INFORMATION
The following pro forma financial statements reflect all of
Hibernia's pending mergers giving effect to the assumptions and
adjustments described in the accompanying notes.
The information in the column titled "Hibernia Corporation"
on the Pro Forma Combined Balance Sheet and the Pro Forma
Combined Statements of Income are summarized from Hibernia's
Annual Report on Form 10-K for the year ended December 31, 1993
and its Quarterly Report on Form 10-Q for the six-month period
ended June 30, 1994. The information contained in the column
titled "Restated Hibernia" that reflects year-end information is
summarized from the supplemental consolidated financial
statements of Hibernia filed in Hibernia's Current Report on Form
8-K dated October 11, 1994, which reflects the four mergers
consummated in the third quarter of 1994. The information
contained in the columns titled "First State," "Pioneer
Bancshares Corporation," "American Bank" and "STABA Bancshares,
Inc." are based on December 31, 1993, 1992 and 1991 audited
financial statements of those entities and unaudited financial
statements of those entities for the six-month periods ended
June 30, 1994 and 1993. The pro forma financial statements do
not purport to be indicative of the results that actually would
have occurred if the mergers or the pending transactions had
occurred on the dates indicated or that may be obtained in the
future.
On June 1, 1994, Hibernia entered into an agreement and plan
of merger with Pioneer, a bank holding company that owns Pioneer
Bank & Trust Company, headquartered in Shreveport, Louisiana. At
June 30, 1994, Pioneer reported consolidated assets of $362
million, shareholders' equity of $29.8 million and operated 12
banking branches in Caddo Parish, Louisiana. The terms of the
merger agreement provide that Hibernia will issue 8,370,511
shares of Hibernia Common Stock for all of the outstanding shares
of Pioneer, subject to adjustment if the Average Market Price of
Hibernia Common Stock is less than $7.50 or more than $9.50 on
the date that the merger is closed. In any event, the value of
the Hibernia Common Stock to be issued to shareholders of Pioneer
will not be less than $62,779,000, or more than $72,500,000. For
purposes of these pro forma financial statements, it is assumed
that Hibernia will issue 8,370,511 shares of Hibernia Common
Stock in connection with the Pioneer merger. The transaction
will be accounted for as a pooling of interests.
On September 19, 1994, Hibernia announced that it had
reached an agreement to merge with American Bank, headquartered
in Norco, Louisiana. As of June 30, 1994, American Bank had
assets of approximately $93.5 million, shareholders' equity of
$7.8 million and operated five banking branches, one each in
Norco, Boutte, Destrehan, Hahnville and Luling, Louisiana. The
terms of the merger agreement provide that Hibernia will issue
2,250,000 shares of Hibernia Common Stock for all of the
outstanding shares of American Bank, subject to adjustment if the
Average Market Price of Hibernia Common Stock is less than $7.75
or more than $8.875 on the date the merger is closed. In any
event, the value of the Hibernia Common Stock to be issued to
shareholders of American Bank will not be less than $17,437,500,
or more than $19,968,750. For purposes of these pro forma
financial statements, it is assumed that Hibernia will issue
2,250,000 shares of Hibernia Common Stock in connection with the
American Bank merger. The transaction will be accounted for as a
pooling of interests.
On November 4, 1994, Hibernia announced that it had reached
an agreement to merge with STABA Bancshares, Inc., a bank holding
company headquartered in Donaldsonville, Louisiana that owns
State Bank and Trust Company. At June 30, 1994, STABA reported
consolidated assets of $95 million, shareholders' equity of $7.4
million and operated four banking branches in Ascension Parish,
Louisiana. The terms of the merger agreement provide that
Hibernia will issue Hibernia Common Stock valued at an aggregate
of $18 million for all of the outstanding shares of STABA. For
purposes of these pro forma financial statements, it is assumed
that Hibernia will issue 2,117,647 shares of Hibernia Common
Stock in connection with the STABA merger. The transaction will
be accounted for as a pooling of interests.
The mergers with Pioneer, American Bank and STABA are
subject to the satisfaction of certain conditions similar to
those described herein with regard to the Merger. There can be
no assurance that any of such proposed mergers will occur, or
that the timing of the consummation of such mergers will be as
assumed in the following pro forma financial statements.
PRO FORMA COMBINED BALANCE SHEET
(Unaudited)
The following unaudited pro forma combined balance sheet
combines the restated balance sheet of Hibernia and the
historical balance sheet of First State as if the Merger had been
effective on June 30, 1994. This unaudited pro forma combined
balance sheet should be read in conjunction with the historical
financial statements and related notes of Hibernia, incorporated
by reference into this Proxy Statement, and the historical
financial statements and related notes of First State contained
elsewhere herein. The restated balance sheet reflects the impact
of four mergers consummated in the third quarter of 1994 as
discussed in Note A to the pro forma financial statements. The
unaudited pro forma combined balance sheet also gives effect to
other probable mergers of Hibernia with Pioneer, American Bank
and STABA, as discussed in Notes A, C and D to the pro forma
combined financial statements. Each probable merger has been
included in the pro forma combined balance sheet as though the
merger had been effective on June 30, 1994.
<PAGE>
HIBERNIA CORPORATION
PRO FORMA COMBINED BALANCE SHEET
June 30, 1994
<TABLE>
<CAPTION>
(A) FIRST STATE
RESTATED BANK AND PRO PRO FORMA
HIBERNIA HIBERNIA TRUST FORMA HIBERNIA
Unaudited ($ in thousands) CORPORATION CORPORATION COMPANY ADJ. CORPORATION
<S> <C> <C> <C> <C> <C>
ASSETS
Cash and due from banks $236,320 $263,172 $6,880 $270,052
Interest-bearing time deposits in domestic banks - 197 - 197
Short-term investments 75,245 57,512 6,500 64,012
Securities available for sale 435,223 686,499 - 686,499
Securities held to maturity 1,501,374 1,639,341 84,076 1,723,417
Loans, net of unearned income 2,498,068 2,909,658 49,427 2,959,085
Reserve for possible loan losses (158,332) (167,199) (1,585) (168,784)
Loans, net 2,339,736 2,742,459 47,842 2,790,301
Bank premises and equipment 84,938 96,696 1,511 98,207
Customers' acceptance liability 9,730 9,730 - 9,730
Other assets 174,598 196,226 2,877 199,103
TOTAL ASSETS $4,857,164 $5,691,832 $149,686 $0 $5,841,518
LIABILITIES
Deposits:
Demand, noninterest-bearing $763,417 $890,106 $22,648 $912,754
Interest-bearing 3,385,726 4,022,125 106,288 4,128,413
Total Deposits 4,149,143 4,912,231 128,936 5,041,167
Federal funds purchased and securities sold under
agreements to repurchase 166,197 179,193 - 179,193
Liability on acceptances 9,730 9,730 - 9,730
Other liabilities 89,354 100,976 722 101,698
Debt - 3,741 - 3,741
TOTAL LIABILITIES 4,414,424 5,205,871 129,658 0 5,335,529
SHAREHOLDERS' EQUITY
Common Stock 160,738 185,740 1,000 5,432 (B) 192,172
Surplus 405,362 391,813 8,000 (5,432)(B) 394,381
Treasury Stock - - - -
Retained earnings (deficit) (118,276) (82,328) 11,028 (71,300)
Unrealized gain (loss) on securities available for sale (5,084) (9,264) - (9,264)
TOTAL SHAREHOLDERS' EQUITY 442,740 485,961 20,028 505,989
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $4,857,164 $5,691,832 $149,686 $0 $5,841,518
See notes to Pro Forma Combined Financial Statements.
</TABLE>
<PAGE>
HIBERNIA CORPORATION
PRO FORMA COMBINED BALANCE SHEET
June 30, 1994
(CONTINUED)
<TABLE>
<CAPTION>
(E)
TOTAL
PRO FORMA PIONEER STABA PRO FORMA
HIBERNIA BANCSHARES, AMERICAN BANCSHARES, PRO FORMA HIBERNIA
Unaudited ($ in thousands) CORPORATION CORPORATION BANK INC. ADJUSTMENTS CORPORATION
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Cash and due from banks $270,052 $19,225 $3,795 $4,190 $297,262
Interest-bearing time deposits in domestic banks 197 1,483 186 1,085 2,951
Short-term investments 64,012 2,049 4,600 510 ($2,145)(D) 69,026
Securities available for sale 686,499 47,861 17,229 23,811 775,400
Securities held to maturity 1,723,417 129,926 9,345 17,159 1,879,847
Loans, net of unearned income 2,959,085 151,009 55,106 46,175 3,211,375
Reserve for possible loan losses (168,784) (2,690) (1,085) (1,015) (173,574)
Loans, net 2,790,301 148,319 54,021 45,160 0 3,037,801
Bank premises and equipment 98,207 7,409 2,587 1,904 110,107
Customers' acceptance liability 9,730 - - - 9,730
Other assets 199,103 5,714 1,778 1,434 208,029
TOTAL ASSETS $5,841,518 $361,986 $93,541 $95,253 ($2,145) $6,390,153
LIABILITIES
Deposits:
Demand, noninterest-bearing $912,754 $70,708 $13,557 $13,641 $1,010,660
Interest-bearing 4,128,413 249,809 71,375 73,936 4,523,533
Total Deposits 5,041,167 320,517 84,932 87,577 0 5,534,193
Federal funds purchased and securities sold under
agreements to repurchase 179,193 5,476 252 - 184,921
Liability on acceptances 9,730 - - - 9,730
Other liabilities 101,698 4,061 540 229 ($65)(D) 106,463
Debt 3,741 2,080 - - (2,080)(D) 3,741
TOTAL LIABILITIES 5,335,529 332,134 85,724 87,806 (2,145) 5,839,048
SHAREHOLDERS' EQUITY
Common Stock 192,172 2,880 484 152 20,941 (C) 216,629
Surplus 394,381 6,742 3,516 3,176 (21,754)(C) 386,061
Treasury Stock - (813) - - 813 (C) -
Retained earnings (deficit) (71,300) 21,284 4,063 4,278 (41,675)
Unrealized gain (loss) on securities available for sale (9,264) (241) (246) (159) (9,910)
TOTAL SHAREHOLDERS' EQUITY 505,989 29,852 7,817 7,447 0 551,105
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $5,841,518 $361,986 $93,541 $95,253 ($2,145) $6,390,153
See notes to Pro Forma Combined Financial Statements.
</TABLE>
PRO FORMA COMBINED STATEMENTS OF INCOME
(Unaudited)
The following unaudited pro forma combined statements of
income for the six months ended June 30, 1994 and 1993, and the
years ended December 31, 1993, 1992 and 1991 combines the
restated statements of income of Hibernia and the historical
statements of income of First State as if the Merger had been
effective on January 1, 1991. The unaudited pro forma combined
statements of income should be read in conjunction with the
historical financial statements and related notes of Hibernia and
the supplemental consolidated financial statements and related
notes of Hibernia filed in Hibernia's Current Report on Form 8-K,
dated October 11, 1994, incorporated by reference into this Proxy
Statement, and the historical financial statements and related
notes of First State, contained elsewhere herein. The restated
statements of income reflect the impact of four mergers
consummated in the third quarter of 1994 as discussed in Note A
to the pro forma financial statements. The costs associated with
the Merger, estimated to be approximately $609,000, will be
accounted for as a current period expense upon consummation of
the Merger and have not been reflected in the pro forma combined
statements of income. The unaudited pro forma combined
statements of income also give effect to probable mergers to
which Hibernia is a party as discussed in Notes A, C and D to the
pro forma combined financial statements. These mergers include
Pioneer, American Bank and STABA. Each probable merger has been
included in the pro forma combined statements of income as though
the merger had been effective on January 1, 1991.
<PAGE>
HIBERNIA CORPORATION
PRO FORMA COMBINED STATEMENT OF INCOME
Six Months Ended June 30, 1994
<TABLE>
<CAPTION>
(A) FIRST STATE
RESTATED BANK AND PRO FORMA
HIBERNIA HIBERNIA TRUST HIBERNIA
Unaudited ($ in thousands, except per share data) CORPORATION CORPORATION COMPANY CORPORATION
<S> <C> <C> <C> <C>
Interest Income
Interest and fees on loans $96,700 $115,418 $2,214 $117,632
Interest on securities:
U.S. government securities and obligations of
U.S. government agencies 53,579 64,095 2,183 66,278
Obligations of states and political subdivisions - 676 6 682
Trading account interest 15 15 - 15
Interest on time deposits in domestic banks - 31 - 31
Interest on federal funds sold and securities
purchased under agreements to resell 2,428 3,022 117 3,139
Total Interest Income 152,722 183,257 4,520 187,777
Interest Expense
Interest on deposits 51,423 61,666 1,640 63,306
Interest on federal funds purchased and
securities sold under agreements to repurchase 2,291 2,445 - 2,445
Interest on debt and other - 1,250 - 1,250
Total Interest Expense 53,714 65,361 1,640 67,001
Net Interest Income 99,008 117,896 2,880 120,776
Provision for possible loan losses - 20 525 545
Net Interest Income After Provision for
Possible Loan Losses 99,008 117,876 2,355 120,231
Noninterest Income
Trust fees 6,223 6,504 3 6,507
Service charges on deposits 16,482 18,942 355 19,297
Other service, collection and exchange charges 9,266 10,108 149 10,257
Other operating income 3,068 3,411 43 3,454
Securities gains (losses), net - 165 - 165
Total Noninterest Income 35,039 39,130 550 39,680
Noninterest Expense
Salaries and employee benefits 45,167 55,291 798 56,089
Occupancy expense, net 10,286 11,362 331 11,693
Equipment expense 5,432 6,218 99 6,317
Data processing expense 9,291 9,421 87 9,508
Foreclosed property expense (4,900) (3,694) 5 (3,689)
Other operating expense 31,445 38,897 358 39,255
Total Noninterest Expense 96,721 117,495 1,678 119,173
Income Before Income Taxes 37,326 39,511 1,227 40,738
Income tax expense 1,751 2,456 632 3,088
Income from Continuing Operations $35,575 $37,055 $595 $37,650
Pro Forma Weighted Average Common Shares 83,662,494 96,683,988 3,350,000 100,033,988
Pro Forma Income Per Common Share
from Continuing Operations (F) $0.43* $0.38 $0.38
See notes to Pro Forma Combined Financial Statements.
*Historical
</TABLE>
<PAGE>
HIBERNIA CORPORATION
PRO FORMA COMBINED STATEMENT OF INCOME
Six Months Ended June 30, 1994
(continued)
<TABLE>
<CAPTION>
(E)
TOTAL
PRO FORMA PIONEER STABA PRO FORMA
HIBERNIA BANCSHARES AMERICAN BANCSHARES, HIBERNIA
Unaudited ($ in thousands, except per share data) CORPORATION CORPORATION BANK INC. CORPORATION
<S> <C> <C> <C> <C> <C>
Interest Income
Interest and fees on loans $117,632 $6,945 $2,665 $2,008 $129,250
Interest on securities:
U.S. government securities and obligations of
U.S. government agencies 66,278 4,296 713 1,020 72,307
Obligations of states and political subdivisions 682 5 38 152 877
Trading account interest 15 - 0 - 15
Interest on time deposits in domestic banks 31 56 3 19 109
Interest on federal funds sold and securities
purchased under agreements to resell 3,139 117 137 49 3,442
Total Interest Income 187,777 11,419 3,556 3,248 206,000
Interest Expense
Interest on deposits 63,306 3,197 916 1,153 68,572
Interest on federal funds purchased and
securities sold under agreements to repurchase 2,445 31 0 4 2,480
Interest on debt and other 1,250 175 27 - 1,452
Total Interest Expense 67,001 3,403 943 1,157 72,504
Net Interest Income 120,776 8,016 2,613 2,091 133,496
Provision for possible loan losses 545 125 30 120 820
Net Interest Income After Provision for
Possible Loan Losses 120,231 7,891 2,583 1,971 132,676
Noninterest Income
Trust fees 6,507 - 0 - 6,507
Service charges on deposits 19,297 1,415 308 216 21,236
Other service, collection and exchange charges 10,257 1,083 75 28 11,443
Other operating income 3,454 643 82 94 4,273
Securities gains (losses), net 165 (2) 0 23 186
Total Noninterest Income 39,680 3,139 465 361 43,645
Noninterest Expense
Salaries and employee benefits 56,089 4,017 895 580 61,581
Occupancy expense, net 11,693 591 268 85 12,637
Equipment expense 6,317 429 50 161 6,957
Data processing expense 9,508 0 311 11 9,830
Foreclosed property expense (3,689) 117 10 - (3,562)
Other operating expense 39,255 2,439 490 527 42,711
Total Noninterest Expense 119,173 7,593 2,024 1,364 130,154
Income Before Income Taxes 40,738 3,437 1,024 968 46,167
Income tax expense 3,088 1,174 316 328 4,906
Income from Continuing Operations $37,650 $2,263 $708 $640 $41,261
Pro Forma Weighted Average Common Shares 100,033,988 8,370,512 2,250,000 2,117,647 112,772,147
Pro Forma Income Per Common Share
from Continuing Operations (F) $0.38 $0.37
See notes to Pro Forma Combined Financial Statements.
*Historical
</TABLE>
<PAGE>
HIBERNIA CORPORATION
PRO FORMA COMBINED STATEMENT OF INCOME
Six Months Ended June 30, 1993
<TABLE>
<CAPTION>
(A) FIRST STATE
RESTATED BANK AND PRO FORMA
HIBERNIA HIBERNIA TRUST HIBERNIA
Unaudited ($ in thousands, except per share data) CORPORATION CORPORATION COMPANY CORPORATION
<S> <C> <C> <C> <C>
Interest Income
Interest and fees on loans $92,960 $112,075 $2,255 $114,330
Interest on securities:
U.S. government securities and obligations of
U.S. government agencies 53,928 64,505 2,637 67,142
Obligations of states and political subdivisions - 559 16 575
Trading account interest 10 10 - 10
Interest on time deposits in domestic banks 181 233 - 233
Interest on federal funds sold and securities
purchased under agreements to resell 5,140 5,595 75 5,670
Total Interest Income 152,219 182,977 4,983 187,960
Interest Expense
Interest on deposits 50,573 60,905 1,968 62,873
Interest on federal funds purchased and
securities sold under agreements to repurchase 1,798 1,940 - 1,940
Interest on debt and other 279 1,431 - 1,431
Total Interest Expense 52,650 64,276 1,968 66,244
Net Interest Income 99,569 118,701 3,015 121,716
Provision for possible loan losses 8,800 9,628 450 10,078
Net Interest Income After Provision for
Possible Loan Losses 90,769 109,073 2,565 111,638
Noninterest Income
Trust fees 6,374 6,786 3 6,789
Service charges on deposits 14,838 17,225 346 17,571
Other service, collection and exchange charges 7,985 8,842 136 8,978
Other operating income 4,291 5,383 35 5,418
Securities gains (losses), net - 10 - 10
Total Noninterest Income 33,488 38,246 520 38,766
Noninterest Expense
Salaries and employee benefits 41,397 48,365 817 49,182
Occupancy expense, net 9,922 10,896 377 11,273
Equipment expense 5,385 6,185 89 6,274
Data processing expense 8,014 8,129 75 8,204
Foreclosed property expense 2,662 5,195 5 5,200
Other operating expense 35,076 40,505 367 40,872
Total Noninterest Expense 102,456 119,275 1,730 121,005
Income Before Income Taxes and
Extraordinary Items 21,801 28,044 1,355 29,399
Income tax expense - 2,122 591 2,713
Income from Continuing Operations $21,801 $25,922 $764 $26,686
Pro Forma Weighted Average Common Shares 82,825,792 95,847,286 3,350,000 99,197,286
Pro Forma Income Per Common Share
from Continuing Operations (F) $0.26* $0.27 $0.27
See notes to Pro Forma Combined Financial Statements.
*Historical
</TABLE>
<PAGE>
HIBERNIA CORPORATION
PRO FORMA COMBINED STATEMENT OF INCOME
Six Months Ended June 30, 1993
(continued)
<TABLE>
<CAPTION>
(E)
TOTAL
PRO FORMA PIONEER STABA PRO FORMA
HIBERNIA BANCSHARES AMERICAN BANCSHARES, HIBERNIA
Unaudited ($ in thousands, except per share data) CORPORATION CORPORATION BANK INC. CORPORATION
<S> <C> <C> <C> <C> <C>
Interest Income
Interest and fees on loans $114,330 $6,873 $2,392 $1,923 $125,518
Interest on securities:
U.S. government securities and obligations of
U.S. government agencies 67,142 4,664 976 1,044 73,826
Obligations of states and political subdivisions 575 5 3 152 735
Trading account interest 10 - - - 10
Interest on time deposits in domestic banks 233 122 3 40 398
Interest on federal funds sold and securities
purchased under agreements to resell 5,670 148 84 111 6,013
Total Interest Income 187,960 11,812 3,458 3,270 206,500
Interest Expense
Interest on deposits 62,873 3,354 962 1,294 68,483
Interest on federal funds purchased and
securities sold under agreements to repurchase 1,940 - - - 1,940
Interest on debt and other 1,431 367 82 - 1,880
Total Interest Expense 66,244 3,721 1,044 1,294 72,303
Net Interest Income 121,716 8,091 2,414 1,976 134,197
Provision for possible loan losses 10,078 749 - 120 10,947
Net Interest Income After Provision for
Possible Loan Losses 111,638 7,342 2,414 1,856 123,250
Noninterest Income
Trust fees 6,789 - - - 6,789
Service charges on deposits 17,571 1,557 317 186 19,631
Other service, collection and exchange charges 8,978 1,174 62 25 10,239
Other operating income 5,418 490 62 52 6,022
Securities gains (losses), net 10 (75) - - (65)
Total Noninterest Income 38,766 3,146 441 263 42,616
Noninterest Expense
Salaries and employee benefits 49,182 3,731 850 492 54,255
Occupancy expense, net 11,273 586 231 76 12,166
Equipment expense 6,274 384 36 109 6,803
Data processing expense 8,204 186 264 11 8,665
Foreclosed property expense 5,200 688 203 - 6,091
Other operating expense 40,872 2,325 358 490 44,045
Total Noninterest Expense 121,005 7,900 1,942 1,178 132,025
Income Before Income Taxes and
Extraordinary Items 29,399 2,588 913 941 33,841
Income tax expense 2,713 892 289 279 4,173
Income from Continuing Operations $26,686 $1,696 $624 $662 $29,668
Pro Forma Weighted Average Common Shares 99,197,286 8,370,512 2,250,000 2,117,647 111,935,445
Pro Forma Income Per Common Share
from Continuing Operations (F) $0.27 $0.27
See notes to Pro Forma Combined Financial Statements.
*Historical
</TABLE>
<PAGE>
HIBERNIA CORPORATION
PRO FORMA COMBINED STATEMENT OF INCOME
Year Ended December 31, 1993
<TABLE>
<CAPTION>
(A) FIRST STATE
RESTATED BANK AND PRO FORMA
HIBERNIA HIBERNIA TRUST HIBERNIA
Unaudited ($ in thousands, except per share data) CORPORATION CORPORATION COMPANY CORPORATION
<S> <C> <C> <C> <C>
Interest Income
Interest and fees on loans $185,378 $224,146 $4,696 $228,842
Interest on securities:
U.S. government securities and obligations of
U.S. government agencies 105,939 126,820 5,058 131,878
Obligations of states and political subdivisions - 1,222 30 1,252
Trading account interest 33 33 - 33
Interest on time deposits in domestic banks 194 295 - 295
Interest on federal funds sold and securities
purchased under agreements to resell 8,186 9,219 156 9,375
Total Interest Income 299,730 361,735 9,940 371,675
Interest Expense
Interest on deposits 100,092 121,000 3,695 124,695
Interest on federal funds purchased and
securities sold under agreements to repurchase 3,654 4,002 - 4,002
Interest on debt and other 279 2,669 - 2,669
Total Interest Expense 104,025 127,671 3,695 131,366
Net Interest Income 195,705 234,064 6,245 240,309
Provision for possible loan losses (6,200) (5,607) 364 (5,243)
Net Interest Income After Provision for
Possible Loan Losses 201,905 239,671 5,881 245,552
Noninterest Income
Trust fees 12,692 13,310 4 13,314
Service charges on deposits 30,046 34,937 700 35,637
Other service, collection and exchange charges 15,768 17,367 276 17,643
Gain on settlement of acquired loans 1,308 1,308 - 1,308
Other operating income 7,403 7,326 283 7,609
Securities gains (losses), net - 165 - 165
Total Noninterest Income 67,217 74,413 1,263 75,676
Noninterest Expense
Salaries and employee benefits 83,364 98,517 2,047 100,564
Occupancy expense, net 20,611 22,757 792 23,549
Equipment expense 11,043 12,577 181 12,758
Data processing expense 16,504 16,753 160 16,913
Foreclosed property expense 2,188 7,135 25 7,160
Provision for data processing enhancements 11,991 11,991 - 11,991
Other operating expense 73,775 83,604 927 84,531
Total Noninterest Expense 219,476 253,334 4,132 257,466
Income Before Income Taxes and
Cumulative Effect of Accounting Change 49,646 60,750 3,012 63,762
Income tax expense 1,696 5,359 1,031 6,390
Income from Continuing Operations $47,950 $55,391 $1,981 $57,372
Pro Forma Weighted Average Common Shares 83,175,129 96,196,623 3,350,000 99,546,623
Pro Forma Income Per Common Share
from Continuing Operations (F) $0.58* $0.58 $0.58
See notes to Pro Forma Combined Financial Statements.
*Historical
</TABLE>
<PAGE>
HIBERNIA CORPORATION
PRO FORMA COMBINED STATEMENT OF INCOME
Year Ended December 31, 1993
(continued)
<TABLE>
<CAPTION>
(E)
TOTAL
PRO FORMA PIONEER STABA PRO FORMA
HIBERNIA BANCSHARES AMERICAN BANCSHARES, HIBERNIA
Unaudited ($ in thousands, except per share data) CORPORATION CORPORATION BANK INC. CORPORATION
<S> <C> <C> <C> <C> <C>
Interest Income
Interest and fees on loans $228,842 $14,704 $4,705 $3,951 $252,202
Interest on securities:
U.S. government securities and obligations of
U.S. government agencies 131,878 8,980 1,756 2,073 144,687
Obligations of states and political subdivisions 1,252 85 21 294 1,652
Trading account interest 33 - - - 33
Interest on time deposits in domestic banks 295 255 6 77 633
Interest on federal funds sold and securities
purchased under agreements to resell 9,375 217 125 166 9,883
Total Interest Income 371,675 24,241 6,613 6,561 409,090
Interest Expense
Interest on deposits 124,695 6,596 1,851 2,542 135,684
Interest on federal funds purchased and
securities sold under agreements to repurchase 4,002 15 - - 4,017
Interest on debt and other 2,669 948 - - 3,617
Total Interest Expense 131,366 7,559 1,851 2,542 143,318
Net Interest Income 240,309 16,682 4,762 4,019 265,772
Provision for possible loan losses (5,243) 1,509 - 270 (3,464)
Net Interest Income After Provision for
Possible Loan Losses 245,552 15,173 4,762 3,749 269,236
Noninterest Income
Trust fees 13,314 - - - 13,314
Service charges on deposits 35,637 2,965 625 402 39,629
Other service, collection and exchange charges 17,643 2,290 92 54 20,079
Gain on settlement of acquired loans 1,308 - - - 1,308
Other operating income 7,609 564 463 123 8,759
Securities gains (losses), net 165 (73) 5 91 188
Total Noninterest Income 75,676 5,746 1,185 670 83,277
Noninterest Expense
Salaries and employee benefits 100,564 7,593 1,559 1,120 110,836
Occupancy expense, net 23,549 1,264 285 163 25,261
Equipment expense 12,758 755 282 318 14,113
Data processing expense 16,913 186 534 27 17,660
Foreclosed property expense 7,160 723 587 - 8,470
Provision for data processing enhancements 11,991 - - - 11,991
Other operating expense 84,531 4,733 981 1,011 91,256
Total Noninterest Expense 257,466 15,254 4,228 2,639 279,587
Income Before Income Taxes and
Cumulative Effect of Accounting Change 63,762 5,665 1,719 1,780 72,926
Income tax expense 6,390 1,975 508 528 9,401
Income from Continuing Operations $57,372 $3,690 $1,211 $1,252 $63,525
Pro Forma Weighted Average Common Shares 99,546,623 8,370,512 2,250,000 2,117,647 112,284,782
Pro Forma Income Per Common Share
from Continuing Operations (F) $0.58 $0.57
See notes to Pro Forma Combined Financial Statements.
*Historical
</TABLE>
<PAGE>
HIBERNIA CORPORATION
PRO FORMA COMBINED STATEMENT OF INCOME
Year Ended December 31, 1992
<TABLE>
<CAPTION>
(A) FIRST STATE
RESTATED BANK AND PRO FORMA
HIBERNIA HIBERNIA TRUST HIBERNIA
Unaudited ($ in thousands, except per share data) CORPORATION CORPORATION COMPANY CORPORATION
<S> <C> <C> <C> <C>
Interest Income
Interest and fees on loans $253,183 $293,980 $4,650 $298,630
Interest on securities:
U.S. government securities and obligations of
U.S. government agencies 89,131 111,482 5,889 117,371
Obligations of states and political subdivisions 3 1,202 36 1,238
Trading account interest 99 99 - 99
Interest on time deposits in domestic banks 223 361 - 361
Interest on federal funds sold and securities
purchased under agreements to resell 14,095 15,198 254 15,452
Total Interest Income 356,734 422,322 10,829 433,151
Interest Expense
Interest on deposits 141,502 167,648 5,022 172,670
Interest on federal funds purchased and
securities sold under agreements to repurchase 6,515 6,910 - 6,910
Interest on debt and other 11,439 13,366 - 13,366
Total Interest Expense 159,456 187,924 5,022 192,946
Net Interest Income 197,278 234,398 5,807 240,205
Provision for possible loan losses 66,275 68,327 545 68,872
Net Interest Income After Provision for
Possible Loan Losses 131,003 166,071 5,262 171,333
Noninterest Income
Trust fees 12,263 12,849 5 12,854
Service charges on deposits 31,870 36,451 699 37,150
Other service, collection and exchange charges 13,928 15,745 264 16,009
Gain on settlement of acquired loans 4,151 4,151 - 4,151
Loss on planned sale of Texas bank (2,934) (2,934) - (2,934)
Other operating income 9,972 9,760 149 9,909
Securities gains, net 17,190 17,336 - 17,336
Total Noninterest Income 86,440 93,358 1,117 94,475
Noninterest Expense
Salaries and employee benefits 86,141 99,480 1,982 101,462
Occupancy expense, net 23,275 25,393 768 26,161
Equipment expense 13,447 15,019 141 15,160
Data processing expense 17,477 17,726 137 17,863
Foreclosed property expense 16,302 22,702 29 22,731
Other operating expense 68,716 77,691 958 78,649
Total Noninterest Expense 225,358 258,011 4,015 262,026
Income (Loss) Before Income Taxes and
Extraordinary Items (7,915) 1,418 2,364 3,782
Income tax expense - 3,170 849 4,019
Income (Loss) from Continuing Operations ($7,915) ($1,752) $1,515 ($237)
Pro Forma Weighted Average Common Shares 29,608,279 42,629,773 3,350,000 45,979,773
Pro Forma Income (Loss) Per Common Share
from Continuing Operations (F) ($0.27)* ($0.04) ($0.01)
See notes to Pro Forma Combined Financial Statements.
*Historical
</TABLE>
<PAGE>
HIBERNIA CORPORATION
PRO FORMA COMBINED STATEMENT OF INCOME
Year Ended December 31, 1992
(continued)
<TABLE>
<CAPTION>
(E)
TOTAL
PRO FORMA PIONEER STABA PRO FORMA
HIBERNIA BANCSHARES AMERICAN BANCSHARES, HIBERNIA
Unaudited ($ in thousands, except per share data) CORPORATION CORPORATION BANK INC. CORPORATION
<S> <C> <C> <C> <C> <C>
Interest Income
Interest and fees on loans $298,630 $14,947 $4,360 $3,716 $321,653
Interest on securities:
U.S. government securities and obligations of
U.S. government agencies 117,371 11,030 2,250 2,023 132,674
Obligations of states and political subdivisions 1,238 187 - 282 1,707
Trading account interest 99 - - - 99
Interest on time deposits in domestic banks 361 252 4 81 698
Interest on federal funds sold and securities
purchased under agreements to resell 15,452 343 159 374 16,328
Total Interest Income 433,151 26,759 6,773 6,476 473,159
Interest Expense
Interest on deposits 172,670 9,158 2,453 2,920 187,201
Interest on federal funds purchased and
securities sold under agreements to repurchase 6,910 - - - 6,910
Interest on debt and other 13,366 732 - - 14,098
Total Interest Expense 192,946 9,890 2,453 2,920 208,209
Net Interest Income 240,205 16,869 4,320 3,556 264,950
Provision for possible loan losses 68,872 2,221 - 363 71,456
Net Interest Income After Provision for
Possible Loan Losses 171,333 14,648 4,320 3,193 193,494
Noninterest Income
Trust fees 12,854 6 - - 12,860
Service charges on deposits 37,150 3,129 672 406 41,357
Other service, collection and exchange charges 16,009 2,284 149 31 18,473
Gain on settlement of acquired loans 4,151 - - - 4,151
Loss on planned sale of Texas bank (2,934) - - - (2,934)
Other operating income 9,909 1,447 505 67 11,928
Securities gains, net 17,336 14 84 - 17,434
Total Noninterest Income 94,475 6,880 1,410 504 103,269
Noninterest Expense
Salaries and employee benefits 101,462 6,936 1,379 998 110,775
Occupancy expense, net 26,161 1,351 258 162 27,932
Equipment expense 15,160 570 252 218 16,200
Data processing expense 17,863 864 462 19 19,208
Foreclosed property expense 22,731 2,637 967 13 26,348
Other operating expense 78,649 5,876 989 874 86,388
Total Noninterest Expense 262,026 18,234 4,307 2,284 286,851
Income (Loss) Before Income Taxes and
Extraordinary Items 3,782 3,294 1,423 1,413 9,912
Income tax expense 4,019 1,094 422 349 5,884
Income (Loss) from Continuing Operations ($237) $2,200 $1,001 $1,064 $4,028
Pro Forma Weighted Average Common Shares 45,979,773 8,370,512 2,250,000 2,117,647 58,717,932
Pro Forma Income (Loss) Per Common Share
from Continuing Operations (F) ($0.01) $0.07
See notes to Pro Forma Combined Financial Statements.
*Historical
</TABLE>
<PAGE>
HIBERNIA CORPORATION
PRO FORMA COMBINED STATEMENT OF INCOME
Year Ended December 31, 1991
<TABLE>
<CAPTION>
(A) FIRST STATE
RESTATED BANK AND PRO FORMA
HIBERNIA HIBERNIA TRUST HIBERNIA
Unaudited ($ in thousands, except per share data) CORPORATION CORPORATION COMPANY CORPORATION
<S> <C> <C> <C> <C>
Interest Income
Interest and fees on loans $451,675 $495,697 $4,797 $500,494
Interest on securities:
U.S. government securities and obligations of
U.S. government agencies 114,629 135,929 5,674 141,603
Obligations of states and political subdivisions 4,970 6,274 64 6,338
Trading account interest 70 70 - 70
Interest on time deposits in domestic banks 100 522 - 522
Interest on federal funds sold and securities
purchased under agreements to resell 9,285 11,417 673 12,090
Total Interest Income 580,729 649,909 11,208 661,117
Interest Expense
Interest on deposits 317,780 355,371 6,685 362,056
Interest on federal funds purchased and
securities sold under agreements to repurchase 16,177 16,794 - 16,794
Interest on debt and other 12,173 14,396 - 14,396
Total Interest Expense 346,130 386,561 6,685 393,246
Net Interest Income 234,599 263,348 4,523 267,871
Provision for possible loan losses 178,330 180,589 1,200 181,789
Net Interest Income After Provision for
Possible Loan Losses 56,269 82,759 3,323 86,082
Noninterest Income
Trust fees 14,346 14,844 6 14,850
Service charges on deposits 34,779 39,209 675 39,884
Other service, collection and exchange charges 19,938 21,775 232 22,007
Credit card income 5,251 5,413 - 5,413
Gain on settlement of acquired loans 9,043 9,043 - 9,043
Other operating income 8,512 8,145 131 8,276
Securities gains, net 17,801 17,707 - 17,707
Total Noninterest Income 109,670 116,136 1,044 117,180
Noninterest Expense
Salaries and employee benefits 115,173 128,063 1,660 129,723
Occupancy expense, net 28,785 30,823 837 31,660
Equipment expense 13,979 15,579 96 15,675
Data processing expense 12,548 12,783 108 12,891
Foreclosed property expense 24,854 28,781 34 28,815
Credit card expense 3,136 3,136 - 3,136
Other operating expense 110,679 118,875 1,095 119,970
Total Noninterest Expense 309,154 338,040 3,830 341,870
Income (Loss) Before Minority Interests (143,215) (139,145) 537 (138,608)
Less: Minority interest - 311 - 311
Income (Loss) Before Income Taxes,
Extraordinary Item and Cumulative Effect
of Accounting Change (143,215) (139,456) 537 (138,919)
Income tax expense 782 1,911 257 2,168
Income (Loss) from Continuing Operations ($143,997) ($141,367) $280 ($141,087)
Pro Forma Weighted Average Common Shares 28,116,938 41,138,432 3,350,000 44,488,432
Pro Forma Income (Loss) Per Common Share
from Continuing Operations (F) ($5.12)* ($3.44) ($3.17)
See notes to Pro Forma Combined Financial Statements.
*Historical
</TABLE>
<PAGE>
HIBERNIA CORPORATION
PRO FORMA COMBINED STATEMENT OF INCOME
Year Ended December 31, 1991
(continued)
<TABLE>
<CAPTION>
(E)
TOTAL
PRO FORMA PIONEER STABA PRO FORMA
HIBERNIA BANCSHARES AMERICAN BANCSHARES, HIBERNIA
Unaudited ($ in thousands, except per share data) CORPORATION CORPORATION BANK INC. CORPORATION
<S> <C> <C> <C> <C> <C>
Interest Income
Interest and fees on loans $500,494 $16,686 $4,060 $3,606 $524,846
Interest on securities:
U.S. government securities and obligations of
U.S. government agencies 141,603 12,042 2,336 1,736 157,717
Obligations of states and political subdivisions 6,338 394 13 253 6,998
Trading account interest 70 - - - 70
Interest on time deposits in domestic banks 522 291 6 125 944
Interest on federal funds sold and securities
purchased under agreements to resell 12,090 572 211 349 13,222
Total Interest Income 661,117 29,985 6,626 6,069 703,797
Interest Expense
Interest on deposits 362,056 14,866 3,623 3,365 383,910
Interest on federal funds purchased and
securities sold under agreements to repurchase 16,794 - - - 16,794
Interest on debt and other 14,396 838 - - 15,234
Total Interest Expense 393,246 15,704 3,623 3,365 415,938
Net Interest Income 267,871 14,281 3,003 2,704 287,859
Provision for possible loan losses 181,789 2,561 90 175 184,615
Net Interest Income After Provision for
Possible Loan Losses 86,082 11,720 2,913 2,529 103,244
Noninterest Income
Trust fees 14,850 11 - - 14,861
Service charges on deposits 39,884 2,715 677 367 43,643
Other service, collection and exchange charges 22,007 1,636 144 83 23,870
Credit card income 5,413 - 24 - 5,437
Gain on settlement of acquired loans 9,043 - - - 9,043
Other operating income 8,276 207 245 28 8,756
Securities gains, net 17,707 186 - - 17,893
Total Noninterest Income 117,180 4,755 1,090 478 123,503
Noninterest Expense
Salaries and employee benefits 129,723 5,548 1,355 868 137,494
Occupancy expense, net 31,660 1,169 252 137 33,218
Equipment expense 15,675 491 209 201 16,576
Data processing expense 12,891 761 392 13 14,057
Foreclosed property expense 28,815 2,421 297 12 31,545
Credit card expense 3,136 - - - 3,136
Other operating expense 119,970 3,842 1,009 744 125,565
Total Noninterest Expense 341,870 14,232 3,514 1,975 361,591
Income (Loss) Before Minority Interests (138,608) 2,243 489 1,032 (134,844)
Less: Minority interest 311 - - - 311
Income (Loss) Before Income Taxes,
Extraordinary Item and Cumulative Effect
of Accounting Change (138,919) 2,243 489 1,032 (135,155)
Income tax expense 2,168 572 122 270 3,132
Income (Loss) from Continuing Operations ($141,087) $1,671 $367 $762 ($138,287)
Pro Forma Weighted Average Common Shares 44,488,432 8,370,512 2,250,000 2,117,647 57,226,591
Pro Forma Income (Loss) Per Common Share
from Continuing Operations (F) ($3.17) ($2.42)
See notes to Pro Forma Combined Financial Statements.
*Historical
</TABLE>
Notes To Pro Forma Combined Financial Statements.
A. The "Restated Hibernia Corporation" information reflects the
results of the mergers with Commercial and Bastrop,
consummated on July 1, 1994; and First Continental and First
Bancorp, consummated on August 1, 1994, which were accounted
for as poolings of interests. Hibernia issued 13,021,494
shares of Hibernia Common Stock, with a stated value of
$25,002,000, to effect these mergers. Debt totaling
$17,825,000 and related accrued interest and premium of
$4,930,000 was retired in conjunction with these mergers.
B. It is assumed that Hibernia will issue Hibernia Common Stock
with an aggregate market value at the date of the merger of
$28,475,000 to effect the merger with First State. The
Hibernia Common Stock is assumed to have a market value of
$8.50 per share, resulting in the issuance of 3,350,000
shares of common stock for all the outstanding First State
Common Stock. The stated value of Hibernia Common Stock is
$1.92 per share. In accordance with the pooling of
interests method of accounting, the historical equities of
the merged companies are combined.
If the Average Market Price is less then $7.75 per share,
than the number of shares of Hibernia Common Stock to be
exchanged in the Merger will be increased proportionately
with the decrease in the Average Market Price below that
level to ensure that an aggregate value of at least
$25,692,500 of Hibernia Stock is exchanged in the Merger.
Similarly, if the Average Market Price is more than $9.75
per share, then the number of shares of Hibernia Common
Stock to be exchanged in the Merger will be decreased
proportionately with the increase in the Average Market
Price above that level to ensure that an aggregate value of
no more than $32,662,500 of Hibernia Common Stock is
exchanged in the Merger. However, if the Average Market
Price is between $9.75 and $7.75, the number of shares to be
exchanged will remain constant, even if the Average Market
Price fluctuates within that range.
C. In addition to the Merger, Hibernia is a party to pending
mergers with Pioneer, American Bank and STABA. It is
assumed that Hibernia will issue the number of shares of
Hibernia Common Stock set forth below in order to effect
these mergers in transactions using the pooling of interests
method of accounting.
The Hibernia Common Stock is assumed to have a market value
of $8.50 per share and a stated value of $1.92 per share.
In accordance with the pooling of interests method of
accounting, the historical equities of the merged companies
are combined.
Assumed Assumed Assumed
Assumed Mkt Stated Exchange
Hibernia Value Value Ratio
Shares of of
Shares Shares
Pioneer 8,370,512 $71,149,000 $16,071,000 30.50
American Bank 2,250,000 19,125,000 4,320,000 4.65
STABA 2,117,647 18,000,000 4,066,000 17.80
Total 12,738,159 $108,274,000 $24,457,000
D. Hibernia will use available federal funds sold to retire
Pioneer debt of $2,080,000 and related accrued interest of
$65,000. The retirement of the Pioneer debt is not a
requirement of the merger.
E. In connection with obtaining regulatory approval of the
Pioneer transaction, Hibernia has agreed to sell three of
the branches currently operated by Pioneer. The sale of
these branches will include the physical premises as well as
all deposits, loans and other assets held by those branches.
Aggregate deposits and aggregate loans held at those
branches as of June 30, 1994 were approximately $43 million
and $21 million, respectively. A definitive agreement to
sell each of the branches must be executed prior to the
closing of the Pioneer merger. The sale of these branches
will not affect the consideration to be paid to Pioneer
shareholders in that merger. The effect of the sale of
these branches is considered immaterial and has not been
reflected in the pro forma combined financial statements.
F. Hibernia expects to achieve savings through reductions in
interest expense and operating costs in connection with the
proposed mergers. The savings vary from merger to merger
depending upon Hibernia's pre-merger operations in the
respective geographic area. The majority of the savings
will be achieved through the retirement of long-term debt in
connection with the merger and the consolidation of certain
operations. The extent to which the savings will be
achieved depends, among other things, on the regulatory
environment and economic conditions, and may be affected by
unanticipated changes in business activities, inflation and
certain external factors such as Federal Deposit Insurance
Corporation (the "FDIC") assessments. Therefore, there can
be no assurance that such savings will be realized. No
adjustment has been included in the unaudited pro forma
financial statements for the anticipated savings.
CERTAIN INFORMATION ABOUT HIBERNIA
Hibernia is a Louisiana corporation registered under the
BHCA. As of June 30, 1994, Hibernia had total consolidated
assets of approximately $4.9 billion and shareholders' equity of
approximately $443 million. As of June 30, 1994, Hibernia was
ranked, on the basis of total assets, as the 90th largest bank
holding company in the United States and the second largest
headquartered in Louisiana. Hibernia has a single banking
subsidiary, HNB, a national banking association that provides
retail and commercial banking services through 101 branches
throughout Louisiana. The principal executive offices of
Hibernia are located at 313 Carondelet Street, New Orleans,
Louisiana 70130, and its telephone number is (504) 533-5532.
Further information concerning the business of Hibernia, and
its financial condition, management, principal shareholders, and
certain other information has been incorporated by reference into
this Proxy Statement. See "Available Information" and
"Incorporation by Reference."
On October 12, 1994, Hibernia publicly reported third-
quarter net income of $23.2 million ($.24 per share), up 64% from
$14.1 million ($.15 per share) for the same period of 1993, and
up 33% from $17.4 million ($.18 per share) for the second quarter
of 1994. Hibernia's third quarter results reflect a negative
provision for loan losses of $17.5 million and a $16.1 million
write-off of goodwill associated with acquisitions in the mid to
late 1980's.
Supervision and Regulation
General. As a bank holding company, Hibernia is subject to
the regulations and supervision of the Board of Governors of the
Federal Reserve System (the "Federal Reserve Board"). Under the
BHCA, bank holding companies may not directly or indirectly
acquire the ownership or control of more than 5% of the voting
shares or substantially all of the assets of any company,
including a bank, without the prior approval of the Federal
Reserve Board. In addition, bank holding companies are generally
prohibited from engaging in nonbanking activities, subject to
certain exceptions.
Hibernia's banking subsidiary, HNB, is subject to
supervision and examination by applicable federal and state
banking agencies. HNB is a national banking association subject
to the regulations and supervision of the OCC. HNB is also
subject to various requirements and restrictions under federal
and state law, including requirements to maintain reserves
against deposits, restrictions on the types and amounts of loans
that may be granted and the interest that may be charged thereon
and limitations on the types of investments that may be made and
the types of services that may offered. Various consumer laws
and regulations also affect the operations of HNB. In addition
to the impact of such regulation, commercial banks are affected
significantly by the actions of the Federal Reserve Board as it
attempts to control the money supply and credit availability in
order to influence the economy.
Payment of Dividends. Hibernia derives substantially all of
its income from the payment of dividends by HNB, and its ability
to pay dividends would be affected by the ability of HNB to pay
dividends. HNB is subject to various statutory and contractual
restrictions on its ability to pay dividends to Hibernia. Under
such restrictions, the amount available for payment of dividends
to Hibernia by HNB was $____ million at June 30, 1994. In
addition, the OCC has the authority to prohibit any national bank
from engaging in an unsafe or unsound practice, and the OCC has
indicated its view that it generally would be an unsafe and
unsound practice to pay dividends except out of current operating
earnings. The ability of HNB to pay dividends in the future is
presently, and could be further, influenced by bank regulatory
policies or agreements and by capital guidelines. Additional
information in this regard is contained in documents incorporated
by reference herein. See "Available Information" and
"Incorporation by Reference."
In addition, consistent with its policy regarding bank
holding companies serving as a source of strength for their
subsidiary banks, the Federal Reserve Board has stated that, as a
matter of prudent banking, a bank holding company generally
should not maintain a rate of cash dividends unless its net
income available to common shareholders has been sufficient to
fully fund the dividends, and the prospective rate of earnings
retention appears to be consistent with the holding company's
capital needs, asset quality and overall financial condition.
Hibernia reinstated its dividend on Hibernia Common Stock in
September of 1993. Quarterly dividends ranging from $.03 to $.06
per share have been paid on the Hibernia Common Stock since that
time.
Restrictions on Extensions of Credit. HNB is subject to
restrictions imposed by federal law on the ability of any
national bank to extend credit to affiliates, including Hibernia,
to purchase the assets thereof, to issue a guarantee, acceptance
or letter of credit on their behalf (including an endorsement or
standby letter of credit) or to purchase or invest in the stock
or securities thereof or to take such stock or securities as
collateral for loans to any borrower. Such extensions of credit
and issuances generally must be secured by eligible collateral
and are generally limited to 15% of HNB's capital and surplus.
CERTAIN INFORMATION ABOUT FIRST STATE
Business of First State
First State is a state banking association organized under
the laws of Louisiana in 1909. First State offers a diversified
range of commercial banking services for customers located
principally in Washington Parish and St. Tammany Parish,
Louisiana and the surrounding communities. First State's
customer base is composed primarily of individuals who either
work or reside within First State's trade area and commercial
enterprises engaged in a wide range of businesses.
First State provides its customers with a variety of banking
services, including checking accounts, savings accounts, savings
certificates, bank-by-mail, 24-hour depository facilities, drive-
in banking, cashier's checks, money orders, travelers checks,
savings bonds, personal loans, automobile loans, commercial
loans, commercial payroll accounts, home improvement loans and
safe deposit boxes. First State provides investment instruments,
including Series EE savings bonds, certificates of deposit and
individual retirement accounts. All deposit accounts are insured
by the FDIC to the maximum legal limits. Credit services offered
by First State include secured and unsecured commercial loans,
Small Business Administration loans, agricultural loans, real
estate loans and consumer loans.
First State's depositors represent a cross-section of the
area's economy and there is no material concentration of deposits
from any single customer or group of customers. No significant
portion of First State's loans are concentrated within a single
industry or group of related industries. There are no material
seasonal factors that would have any adverse effect on First
State. First State does not rely on foreign sources of funds or
income.
Employees
As of June 30, 1994, First State had 70 full-time employees
(9 of whom were officers) and 10 part-time employees. First
State makes available medical, hospitalization and disability
insurance to all of its employees. First State considers its
relations with its employees to be excellent.
Litigation
First State is not involved in any material legal actions.
However, various proceedings arising in the ordinary course of
First State's business are presently pending to which First State
is a party. In the opinion of management, after consultation
with outside legal counsel, the outcome of such actions should
not have a material adverse effect on the financial condition of
First State.
Competition
First State experiences considerable competition in both
attracting deposits and lending funds. Competition in lending
comes principally from other commercial banks and savings and
loan associations located in First State's market area and from
mortgage companies, insurance companies, brokerage companies,
governmental agencies, credit unions, real estate investment
trusts and other financial institutions. Competition for
deposits comes principally from other commercial banks, savings
and loan associations and credit unions. The primary factors in
competing for deposits among these institutions are interest
rates paid on accounts, convenience of office location and extent
of services offered. In the conduct of certain aspects of its
banking business, First State competes not only with the above-
mentioned institutions, but additionally with insurance
companies, small loan companies and other financial institutions.
Supervision and Regulation
As a state non-member bank, First State is subject to
regulation and regular examination by the FDIC and the Louisiana
Office of Financial Institutions (the "OFI"). Applicable
regulations relate to reserves, investments, loans, issuance of
securities, establishment of branches and other aspects of First
State's operations. First State must also furnish quarterly and
annual reports to the FDIC.
First State's deposits are insured by the FDIC, which
insures up to $100,000 per each insured deposit account. First
State is currently paying an insurance premium of $230 for each
$100,000 of deposits. As of January 1, 1993 the FDIC implemented
a traditional risk-related insurance assessment system whereby
the FDIC places each insured bank in one of nine risk categories
based on its level of capital and other relevant information.
Under the system, there is an eight basis point spread between
the highest and lowest assessment, with the strongest banks
(including First State) paying an insurance premium equal to .23%
of deposits and the weakest banks paying a premium of .31% of
deposits. Due to the recent savings and loan crisis and the
related concern of Congress with regard to the FDIC insurance
fund, there has been increased pressure applied to banks to
conform to regulatory guidelines, along with increased disclosure
requirements on a quarterly and annual basis.
First State is subject to regulatory risk-based capital
guidelines. In the risk-based capital computation, all assets
are weighted based upon assigned risk factors, and certain off-
balance sheets items are included, such as loan commitments and
standby letters of credit. Capital is separated into two
categories, Tier One and Tier Two, which are combined to
calculate total capital. Tier One capital consists of common
shareholders' equity, certain perpetual preferred stock and
minority interests less intangibles. Tier Two capital consists
of the allowance for loan losses and subordinated debt, subject
to certain limitations. The guidelines provide for total capital
of 8% of risk weighted assets, half of which must be Tier One
capital. In conjunction with the risk-based capital guidelines,
the regulators have also issued capital leverage guidelines. The
leverage ratio consists of Tier One capital as a percent of
average total assets. The minimum leverage ratio for all banks
(including First State) is 4%, with a higher leverage ratio
generally required for all but the healthiest of banks. At June
30, 1994, First State's Tier One capital ratio was 26.20%, its
total capital ratio was 27.45% and its leverage ratio was 13.52%.
Management's Discussion and Analysis of Financial Condition and
Results of Operations of First State For The Two Years Ended
December 31, 1993 and December 31, 1992
The following discussion provides certain information
concerning the financial condition and results of operations of
First State for the two years ended December 31, 1993 and 1992.
This discussion should be read in conjunction with the audited
financial statements of First State and notes thereto presented
elsewhere in this Proxy Statement.
Overview. Net income for 1993 totaled $1,981,000, compared
to $1,515,000 in 1992. Return on average assets was 1.34% and
return on average equity was 10.2% for 1993, compared to the
prior year's returns of 1.03% and 8.15%, respectively. The
increase in net income in 1993 compared to 1992 was primarily due
to an increase in net interest income due to the fact that, in a
declining interest rate environment, State Bank's liabilities
repriced faster than its assets.
Average assets decreased .35% in 1993 from the 1992 level.
Total shareholders' equity averaged $18,436,000 in 1993 compared
to $17,321,000 in 1992.
Results of Operations
Net Interest Income. First State's primary source of
revenue is net interest income. Net interest income is the
difference between interest earned on interest-earning assets and
interest paid on interest-bearing sources of funds. The level of
net interest income is determined primarily by the volume of
interest-earning assets and the various rate spreads between the
interest-earning assets and their funding sources. Net interest
income increased from $5,807,000 in 1992 to $6,245,000 in 1993.
Average earning assets increased from $138,195,000 in 1992
to $139,272,000 in 1993. Interest income decreased from
$10,829,000 in 1992 to $9,940,000 in 1993, primarily as a result
of shrinking yields on loans and investments. First State's net
interest margin, the ratio of net interest income to average
earning assets, increased from 4.20% in 1992 to 4.48% in 1993,
primarily due to an increase in earning assets, loans and
investments, and a general decrease in market rates for interest-
bearing deposits. Although net noninterest-bearing sources of
funds increased as a result of higher levels of equity and demand
deposits, due to generally declining interest rates the benefit
of noninterest-bearing funds declined in 1993.
Net interest spread, the difference between the yield on
earning assets and the rate paid on interest-bearing liabilities,
was 3.75% for 1993, a 43 basis point increase from the 1992 level
of 3.32%. The spread increased in 1993 primarily as a result of
a decrease in the interest rates paid on interest-bearing
deposits, as previously discussed, which more than offset a
decrease on the yields of loans and investments.
Interest Rate/Volume Analysis. The following table sets
forth for the periods indicated a summary of the changes in
interest earned and interest paid resulting from changes in
volume and changes in rates:
1993/1992
Change due to
(Dollars in thousands)
Rate Volume Change
Interest income
Loans (396) $442 $ 46
Investment securities - taxable (773) (64) (837)
Investment securities - nontaxable 0 0 0
Federal funds sold and
resale agreements 1 (35) (63) (98)
Total interest income (1,204) 315 (889)
Deposits other than time deposits (269) 247 (22)
Time deposits (854) (451) 1,305)
Total interest expense (1,123) (204) (1,327)
Net interest income $ (81) $519 $ 438
NOTE: The changes in interest due to both volume and rate have been
allocated proportionally between rate and volume.
Average Balances, Yields and Rates Paid
The table below summarizes average assets, liabilities and shareholders'
equity, interest earned and paid and average yields and rates for the two
years ended December 31, 1993 and 1992:
<TABLE>
<CAPTION>
1993 1992
Average Income/ Yields/ Average Income/ Yields/
(Dollars in thousands) Balances Expense Rates Balances Expense Rates
<S> <C> <C> <C> <C> <C> <C>
Assets 9.97%
Loans (1) $ 47,124 $ 4,696 5.88 $ 42,690 $ 4,650 10.89%
Investment securities
-taxable 86,552 5,088 87,644 5,925 6.76
Investment securities
-nontaxable (2) 0 2.79 0
Federal funds sold and
resale agreements 5,596 156 7,861 254 3.23
Total earning assets 139,272 9,940 7.14 138,195 10,829 7.84
Allowance for possible
loan losses 1,628 1,639
Other assets 6,190 7,788
Total Assets $147,090 $147,622
Liabilities and
shareholders' equity
Interest-bearing deposits:
Deposits other than time $ 54,404 1,501 2.76 45,439 1,523 3.35
Time Deposits 54,496 2,194 4.03 65,688 3,499 5.33
Total interest-
bearing liabilities 108,900 3,695 3.39 111,127 5,022 4.52
Noninterest-bearing deposits 19,648 18,108
Other liabilities 106 1,066
Shareholders' equity 18,436 17,321
Total liabilities and
shareholder's equity $147,090 $147,622
Net interest spread 3.75 3.32
Net interest income/margin $6,245 4.48% $5,807 4.20%
(1) Interest income includes loan fees of $95,000 for 1993 and $94,000 for 1992. Nonaccrual loans
are included in average balances and income on such loans is recognized on a cash basis.
(2) The yield on tax-exempt securities is not on a tax equivalent basis for this schedule.
</TABLE>
Interest Rate Sensitivity. The interest rate sensitivity gap is the
difference between the repricing schedule of interest sensitive assets and
interest sensitive liabilities for a given time period. A primary
objective of asset/liability management is to maximize net interest margin
while maintaining a reasonable mix of interest sensitive assets and
liabilities. At December 31, 1993, First State's one-year repricing gap,
defined as repricing assets minus repricing liabilities as a percentage of
total assets, was negative 23.02%, i.e. more of First State's liabilities
than assets reprice within a one- year time frame. In periods of declining
rates, First State has experienced a positive effect on net interest income
as its cost of funds has increased more slowly than interest income on
interest- earning assets. Conversely, in periods of increasing rates,
based on its current interest rate sensitivity gap, First State should
experience decreased net interest income. Management regularly reviews
interest rate exposure to analyze the impact of changes in market interest
rates on net interest income.
<TABLE>
Interest Rate Sensitivity (dollars in thousands)
<CAPTION>
Over One
Revolving 1-90 91-180 181-365 Year All Other Totals
<S> <C> <C> <C> <C> <C> <C> <C>
Assets
Cash and
Due From $ 0 $ 0 $ 0 $ 0 $ 0 $ 6,277 $ 6,277
Fed Funds 2,550 2,550
Securities 2,259 12,100 8,300 10,000 52,691 85,350
Loans 5,115 3,200 5,233 6,384 29,265 49,197
Other Assets
Total $ 9,924 $15,300 $13,533 $16,384 $81,956 $ 9,726 $146,823
Sources of Funds
Non-Interest
Bearing
Deposits $ 0 $ 0 $ 0 $ 0 $ 0 $20,078 $ 20,078
Interest
Bearing 39,904 39,904
Savings 17,294 17,294
Time Deposits 0 19,758 17,085 10,388 2,185 49,417
Other Liabilities 698 698
Shareholders'
Equity
Total $57,198 $19,758 $17,085 $10,388 $ 2,185 $40,208 $146,823
Rate
Sensitivity
Gap ($47,274) ($ 4,458) ($3,552) $ 5,996 $79,771 $ 0
Cumulative Rate
Sensitivity
Gap ($47,274) ($51,732) ($55,284) (49,288) $30,483 $ 0
Cumulative Rate
Sensitivity Gap
as a Percentage
of Total Assets (32.2%) (35.2%) (37.7%) (33.6%) 20.8% N/A
</TABLE>
Provision for Possible Loan Losses. The provision for possible loan
losses charged to operating expense is the result of a continuing review
and assessment of the loan portfolio, taking into consideration the impact
of economic conditions on each borrower's ability to repay, past collection
experience, the risk characteristics of the loan portfolio and other
factors that management deems material. After careful evaluation of the
foregoing factors, management determined that the existing level of
reserves was adequate in view of the risk characteristics of the loan
portfolio at December 31, 1993. Accordingly, First State made a provision
for possible loan losses of $364,000 in 1993, compared to a provision of
$545,000 in 1992.
The allowance for possible loan losses as a percent of average loans
outstanding was 2.50% for 1993 and 2.88% for 1992. Net charge-offs were
$429,000 in 1993 and $402,000 in 1992. The increase in net charge-offs
from 1992 to 1993 was primarily related to management's continued
recognition of credit quality and its effort to recognize problems that
exist in the portfolio.
Other Income and Expense. Other income for 1993 totaled $1,263,000
compared to $1,117,000 in 1992. The increase is primarily due to recovery
from sale of foreclosed real estate. In 1993, operating expenses increased
by $117,000, or 2.91% from the 1992 level. The increase in costs was
somewhat offset by a decrease of $93,000 in write-downs and expenses
associated with foreclosed real estate.
Analysis of Financial Condition
Investment Securities. In 1993, average investment securities decreased
$1,392,000 to $86,552,000, compared to $87,644,000 for 1992. Investment
securities totaled $85,350,000 at the end of 1993. Investment securities
comprised 61.28% of average earning assets at December 31, 1993, compared
to 64.82% at December 31, 1992. At the end of 1993, there were gross
unrealized gains of $1,047,000 and gross unrealized losses of $93,000 in
the securities portfolio. Proceeds from sales and maturities of securities
were $35,257,000 during 1993. The investment securities portfolio is used
to make investments of various maturities in order to improve the overall
earning asset yield. It also serves as a source of liquidity and as
collateral to secure certain types of deposits. The composition of the
portfolio, effectively managed, limits First State's exposure to changes in
interest rates and economic conditions as they occur.
Securities Portfolio. The carrying amount of securities at the dates
indicated is set forth in the table below:
December 31,
(Dollars in thousands) 1993 1992
U. S. Treasury $46,234 $53,029
U. S. Agencies:
Mortgage-backed
Other 38,926 35,953
Other securities 190 591
Total $85,350 $89,573
Maturity Distribution and Investment Securities Portfolio Yields. The
maturities, based on contractual maturities, of securities at December 31,
1993 and the weighted yields of such securities are shown in the table
below. Actual maturities may differ from contractual maturities because,
with respect to mortgage-backed securities, borrowers may have the right to
repay the underlying obligations with or without penalties.
<TABLE>
<CAPTION>
After One After Five
Within But Within But Within After
One Year Five Years Ten Years Ten Years Total
(Dollars in thousands) Amount Yield Amount Yield Amount Yield Amount Yield Amount Yield
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
U. S. Treasury $19,516 5.58% $26,718 5.19% $ 0 0% $ 0 0% $46,234 5.35%
U. S. Agencies:
Mortgage-backed
Other 12,000 5.78 26,826 5.46 38,926 5.56
Other securities 0 0 190 9.77 190 9.77
Total $31,616 5.66% $53,734 5.34% $ 0 0% $ 0 0% $85,350 5.46%
</TABLE>
The yield on tax-exempt securities are not on a tax equivalent basis for
this schedule.
Loans and Nonperforming Assets. The loan portfolio is one of the larger
components of First State's earning assets. Average loans outstanding in
1993 increased $4,434,000, or 10.39%, from the 1992 level of $42,690,000.
The increase in 1993 can be attributed to management's continued efforts to
attract high quality loan customers within First State's local market.
The largest segment of First State's loan portfolio includes commercial
and residential real estate loans, which represented approximately 21.81%
and 54.35% respectively, of the total portfolio as of December 31, 1993.
Consumer loans represented approximately 23.84% of total loans as of the
end of 1993. The portfolio is very diversified with no single loan
relationship exceeding 4.5% of the total loans. First State had no
significant concentrations to individual borrowers or industries.
Total nonperforming loans at December 31, 1993 were $1,108,000. At
December 31, 1992 First State had no nonperforming loans. Other real
estate owned totalled $1,378,000 at December 31, 1993, compared to
$1,553,000 as of the end of 1992.
Nonaccrual loans are loans on which the accrual of interest income has
been discontinued and previously accrued interest has been reversed because
the borrower's financial condition has deteriorated to the extent that the
collection of principal and interest is doubtful. Until the loan is
returned to accrual status, generally as the result of the full payment of
all past due principal and interest, interest income is recorded on a cash
basis. Interest income that would have been recognized on nonaccrual loans
had those loans been on accrual status at contractual terms throughout 1993
was approximately $44,059. Interest income actually recognized on
nonaccrual loans for 1993 was not significant.
Summary of Nonperforming Assets. Nonaccrual, restructured and 90 days
past due loans and other real estate are summarized in the table below.
Also, several ratios that measure First State's level of nonperforming
assets are included in this table.
December 31,
1993 1992
(Dollars in thousands)
Nonperforming loans
Nonaccrual loans $1,108 $ 0
Restructured Loans 0
Total nonperforming loans $1,108 $ 0
Other real estate 1,378 1,553
Total nonperforming assets $2,486 $1,553
Loans 90 days or more past due and
still accruing interest $ 67 $ 227
Nonperforming loans as a % of
total loans 2.25% 0%
Nonperforming assets as a % of total
loans and other real estate 4.92% 3.33%
Allowance for possible loan losses
as a % of nonperforming loans 110.92% ______%
Allowance for possible loan losses
as a % of nonperforming loans 49.44% 83.32%
In addition to the nonaccrual loans included in nonperforming assets,
First State had approximately $676,000 in performing loans that were
classified as of December 31, 1993. Classified loans are credits,
identified internally by management or through the regulatory examination
process, which have a higher degree of risk than other performing loans in
the portfolio.
Loan Portfolio Distribution and Allocation of Allowance for Possible
Loan Losses. The following table shows the amounts of loans outstanding
and the allowance for possible loan losses according to type of loan for
each of the periods indicated:
December 31,
1993 1992
Amount Percent Amount Percent
Loans:
Commercial $10,016 20.36% $ 6,498 14.43%
Agricultural 172 .35 182 .40
Real estate-residential 14,986 30.46 17,740 39.40
Real estate-commercial 12,601 25.61 8,173 18.15
Consumer 11,421 12,435 27.62
Gross loans 49,196 45,028
Discount on purchased
loans 0 0
Less: Unearned income 58 102
Total $49,138 100 % $44,926 100 %
Allowance for possible
loan losses:
Commercial $ 290 23.60% $ 217 17.66%
Agricultural 4 .32 4 .33
Real estate-residential 294 23.92 404 32.87
Consumer 366 29.78 421 34.25
Total $ 1,229 100 % $ 1,294 100 %
Loan Maturity Data. The table below shows the amount of commercial
loans as of December 31, 1993, broken down include commercial and
commercial real estate, residential real estate and consumer and
agricultural loans. It should be noted that all of these loans are fixed
at interest rates.
December 31, 1993
Due Due After 1
(Dollars in thousands) Within But Within Due After
1 Year 5 Years 5 Years Total
Commercial & Commercial $10,145 $12,200 $ 272 $22,617
Real Estate
Real Estate-residential 4,590 9,749 647 14,986
Consumer & Agricultural 4,837 6,659 97 11,593
Total $19,572 $28,608 $ 1,016 $49,196
Summary of Loan Loss Experience. Balances in First State's loan loss
reserves for the two years ended December 31, 1993 and 1992 are summarized
in the following table:
(Dollars in thousands)
1993 1992
Balance at beginning of year $1,294 $1,151
Loans charged off
Commercial 523 147
Agricultural 46 20
Real estate-residential 243 600
Consumer 177 190
Total charge-offs 989 957
Recoveries on loans previously
charged off
Commercial 10 74
Agricultural 39 6
Real estate-residential 438 370
Real estate-commercial 6 6
Consumer 67 99
Total recoveries 560 555
Net loans charged-off 429 402
Additions charged to operations 364 545
Balance at end of year $1,229 $1,294
Ratio of net charge-offs
during period to outstanding
average loans .91% .94%
Deposits. Total deposits at December 31, 1993 were $126,691,000, down
slightly from the level of $131,303,000 posted at December 31, 1992. The
deposit mix changed during 1993, as First State was able to replace matured
interest-bearing deposits with noninterest-bearing demand and lower cost
interest-bearing deposits, which contributed to a reduction in average cost
of funds.
Time deposits of $100,000 or more were $9,876,000 at December 31, 1993.
These deposits consist primarily of public fund time deposits that are
fully secured and deposits from local customers with which First State has
other banking relationships. Although time deposits of $100,000 or more
can exhibit greater volatility to changes in interest rates and other
factors than do core deposits, management believes that due to the nature
of the deposits of this type, any volatility experienced could be
adequately met with current levels of asset liquidity or access to
alternate funding sources. First State had no brokered deposits at
December 31, 1993.
Deposit Average Balances and Rates. The following table indicates the
average daily amount of deposits and rates paid on such deposits for the
periods indicated:
1993 1992
(Dollars in thousands) Amount Rate Amount Rate
Noninterest-bearing demand $ 19,648 0% $ 18,108 0%
Interest-bearing demand 36,863 2.88% 29,989 3.40%
Savings 17,541 2.58% 15,450 3.26%
Time deposits 54,496 4.00% 65,688 5.31%
Total deposits $128,548 $129,235
Maturities of Time Deposits of $100,000 or More. The maturities of time
deposits of $100,000 or more are summarized for December 31, 1993 in the
table below:
(Dollars in thousands) December 31, 1993
3 months or less $4,870
Over 3 months to 12 months 4,906
12 months to 5 years 100
Over 5 years 0
Total $9,876
Capital Resources. First State maintains a strong capital base to take
advantage of business opportunities while ensuring that it has resources to
absorb the risks inherent in its business. First State is required to
comply with the risk-based capital guidelines adopted by the FDIC. Those
guidelines apply weighing factors which vary according to the level of risk
associated with each asset category. The information below summarizes
First State's risk-based capital and leverage ratios for December 31, 1993
and 1992. First State exceeds all minimum required capital ratios.
First State
Specific
Minimum
December 31, Ratio
1993 1992 Requirements
Tier 1 Capital 25.99% 24.90% 6%
Total Capital 27.24% 26.40% 10%
Leverage Ratio 13.14% 11.74% 5%
Liquidity. Liquidity is the ability of First State to fund the needs of
its borrowers, depositors and creditors. First State's management
maintains a strategy that provides adequate liquidity and manages interest
rate risk. First State's liquidity sources, including cash flows from
sales, maturities, and paydowns of loans and investment securities, federal
funds purchased, and a base of core deposits, are considered adequate to
meet liquidity needs for normal operations.
As shown in the accompanying 1993 statement of cash flows, cash and cash
equivalents decreased by $2,254,000 during 1993 to $6,277,000 at December
31, 1993. Cash and cash equivalents were generated primarily by proceeds
from sales and maturities of investment securities totaling $35,257,000,
through proceeds from the sale of other real estate approximating $574,000,
and a net decrease in deposits of $4,712,000. In addition, operating
activities provided net cash of $2,375,000. Offsetting these increases
were purchases of investment securities in the amount of $31,188,000 and a
net increase in loans in the amount of $4,708,000.
Other Matters. In May, 1993, the Financial Accounting Standards Board
issued Statement No. 114, "Accounting by Creditors for Impairment of a
Loan" ("Standard 114"), which requires that impaired loans that are within
the scope of this statement be measured based on the present value of
expected future cash flows discounted at the loan's effective interest rate
or at the loan's market price or the fair value of the collateral if the
loan is collateral dependent. Adoption of Standard 114 is required for
fiscal years beginning after December 15, 1994. Management feels that this
statement will not have a significant economic impact on First State
because the current allowance for possible loan losses should be adequate
to accommodate the change in method for calculating loss accruals.
In May, 1993, the Financial Accounting Standards Board issued Statement
No. 115, "Accounting for Certain Investments in Debt and Equity Securities"
("Standard 115"). Standard 115 addresses the accounting and reporting for
investments in equity securities that have readily determinable fair values
and for all investments in debt securities. Adoption of Standard 115 is
required for fiscal years beginning after December 15, 1993. Standard 115
requires that First State classify its investments in one or more of the
following categories, depending upon First State's intended use of those
investment securities: held to maturity, available for sale, or trading.
Different accounting principles must be followed, depending upon the
category in use. All securities in First State's portfolio at December 31,
1993 are designated by management as held to maturity; consequently, they
will continue to be accounted for at amortized cost.
Management's Discussion and Analysis of Financial Condition and Results of
Operations of First State For The Six-Month Periods Ended June 30, 1994 and
June 30, 1993.
The following discussion provides certain information concerning the
results of operations of First State for the six- month periods ended June
30, 1994 and 1993, and should be read in conjunction with the unaudited
financial statements of First State and the notes thereto for such periods
presented elsewhere in this Proxy Statement. Because there were no
significant material differences that occurred during the June 30, 1993 and
June 30, 1994 comparison periods, detailed information such as that
provided in "Management's Discussion and Analysis of Financial Condition
and Results of Operations of First State For the Two Years Ended December
31, 1993 and December 31, 1992" has been omitted.
Overview. Net income for the six-month period ended June 30, 1994
totaled $595,000, compared to $764,000 for the six-month period ended
June 30, 1993. Return on average assets for the six-month period ended
June 30, 1994 was .82% and return on average equity was 6.07% compared to a
return of 1.05% and 8.51%, respectively, for the same period in 1993. The
decrease in net income in the first six months of 1994, when compared to
the same period in 1993, was primarily due to increases in federal income
taxes and a decrease in net interest income. These differences were
created as a result of changes in the tax laws and the market effect on
rate sensitive assets.
During the periods compared, assets increased by $2.8 million and total
shareholders' equity increased by $1.7 million.
Results of Operations and Analysis of Financial Condition
Net Interest Income. First State's primary source of revenue is net
interest income. Net interest income decreased by $135,000 for the six-
month period ended June 30, 1994 when compared to the same period in 1993
primarily due to an increase in average interest-bearing deposits, which
generated additional interest expense and a reduction in earnings on both
loans and securities.
Non-Interest Income and Expense. First State experienced an increase in
non-interest income of $30,000 and a decrease in non-interest expense of
$52,000 in the six-month period ended June 30, 1994 when compared to the
same period in 1993.
Provision for Loan Losses. The management of First State continues to
provide for possible loan losses. Management believes the provisions made
are adequate to cover future losses on outstanding loans. Management has
made provisions for loan losses of $525,000 as of June 30, 1994, compared
to $450,000 as of June 30, 1993. This represents an increase of $75,000 in
the period ended June 30, 1994 when compared to the same period in 1993.
Loans and Nonperforming Assets. First State has experienced a
substantial decline in delinquencies past due 90 days in the period ended
June 30, 1994. As of June 30, 1994 this total was $36,000, as compared to
$447,000 for the six months ended June 30, 1993.
BENEFICIAL OWNERSHIP OF DIRECTORS, EXECUTIVE OFFICERS AND
PRINCIPAL SHAREHOLDERS OF FIRST STATE
Security Ownership of Directors and Executive Officers
The following is a list of directors and executive officers of First
State and the number and percentage of shares of First State Common Stock
beneficially owned as of October 11, 1994.
Amount Percentage of
Common Stock Common Stock
Beneficially Beneficially
Name Owned Owned
Charles J. Cassidy 40,253 40.25%
Charles M. Cassidy 1,223 1.22%
Nathan W. Bush 1,536 1.54%
Kenneth Smith 822 *
Earl F. Herrington 100 *
Robert J. Puckett 450 *
Harry B. Carney 286 *
Audrey Gatewood 100 *
Devon Miller 100 *
R. W. Richardson 607 *
J. H. Thornhill 522 *
All directors and
executive officers
as a group
(11 persons) 45,999 45.99%
* Represents less than 1% of the outstanding shares of First State Common
Stock.
Security Ownership of Principal Shareholders
The following is a list of all individuals who, to the best of First
State's knowledge, owned, beneficially or of record, five percent (5%) or
more of the issued and outstanding shares of First State Common Stock as of
October 11, 1994 and the number of shares and percentage of First State
Common Stock beneficially owned:
Amount Percentage of
Common Stock Common Stock
Beneficially Beneficially
Name Owned Owned
Charles J. Cassidy 40,253 40.25%
824 N. Columbia Rd.
Bogalusa, LA 70427
<PAGE>
Dorothy C. Gayden
12 Autum Cove
Jackson, MS 39206 10,705 10.70%
H. E. Cassidy, Jr.
P. O. Box 39
Bogalusa, LA 70429 13,392 13.39%
Lucille Cassidy (Jezek) Anderson
14347 Chadbourne
Houston, TX 77079 5,715 5.71%
RELATIONSHIP WITH INDEPENDENT AUDITORS
First State has appointed the firm of H. J. Lowe & Company, L.L.C. as
independent auditor for the fiscal year ending December 31, 1993. Mr.
Howard Tull of H. J. Lowe & Company, L.L.C. is expected to be present at
the Special Meeting of First State's shareholders, and will be available to
respond to appropriate questions.
VALIDITY OF SHARES
Patricia C. Meringer, Associate Counsel and Secretary of Hibernia, has
rendered an opinion that the shares of Hibernia Common Stock to be issued
in connection with the Merger have been duly authorized and, if and when
issued pursuant to the terms of the Agreement, will be validly issued,
fully paid and non-assessable. As of the date of this prospectus,
Ms. Meringer owned 56 shares of Hibernia Common Stock in a 401(k) plan
account and held options to purchase 15,716 shares of Hibernia Common
Stock, which options are not currently exercisable.
EXPERTS
The consolidated financial statements of Hibernia incorporated in this
Prospectus by reference from Hibernia's Annual Report on Form 10-K for the
fiscal year ended December 31, 1993, have been audited by Ernst & Young
LLP, independent auditors, as set forth in their report thereon
incorporated herein by reference, and have been so incorporated by
reference in reliance upon such report given upon the authority of such
firm as experts in accounting and auditing.
The supplemental consolidated financial statements of Hibernia for the
fiscal year ended December 31, 1991 incorporated in this Prospectus by
reference from Hibernia's Current Report on Form 8-K, dated October 11,
1994, have been audited by Ernst & Young LLP, independent auditors, as set
forth in their report thereon incorporated herein by reference, which is
based in part on the reports of the following independent auditors - Arthur
Andersen & Co., L.L.P., KPMG Peat Marwick, L.L.P., Roger C. Parker, and
Castaing, Hussey and Lolan. The supplemental consolidated financial
statements referred to above are incorporated by reference in reliance upon
such reports given upon the authority of such firms as experts in
accounting and auditing.
The Statements of Income, Statements of Stockholders' Equity and
Statements of Cash Flows for First State for the three years ended December
31, 1993, 1992 and 1991 and the Balance Sheets of First State as of
December 31, 1993 and 1992 have been audited by H.J. Lowe & Company,
L.L.C., independent auditors, as set forth in their report thereon included
elsewhere herein. Such financial statements have been so included in
reliance upon the report of H.J. Lowe & Company, L.L.C., given upon their
authority as experts in accounting and auditing.
<PAGE>
FIRST STATE BANK
AND TRUST COMPANY
FINANCIAL REPORT
DECEMBER 31, 1993
<PAGE>
INDEPENDENT AUDITOR'S REPORT
To the Board of Directors
First State Bank and Trust Company
Franklinton, Louisiana
We have audited the accompanying balance sheets of First State Bank
and Trust Company as of December 31, 1993 and 1992, and the related
statements of income, stockholders' equity and cash flows for each
of the years in the three-year period ended December 31, 1993.
These financial statements are the responsibility of the Bank's
management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of First
State Bank and Trust Company as of December 31, 1993 and 1992, and
the results of its operations and its cash flows for each of the
years in the three-year period ended December 31, 1993, in
conformity with generally accepted accounting principles.
January 13, 1994
/s/ H.J. Lowe & Company, L.L.C.
<PAGE>
FIRST STATE BANK AND TRUST COMPANY
BALANCE SHEETS
December 31, 1993 and 1992
<TABLE>
<CAPTION>
1993 1992
------- -------
ASSETS
<S> <C> <C>
Cash and due from banks $ 6,277,000 $ 8,531,000
Securities held to maturity 85,350,000 89,573,000
Federal funds sold 2,550,000 3,050,000
Loans, net 47,909,000 43,632,000
Bank premises and equipment, net 1,643,000 1,647,000
Accrued income receivable 1,568,000 1,769,000
Other assets 1,570,000 1,852,000
------------- -------------
$ 146,867,000 $ 150,054,000
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Deposits:
Interest bearing $ 106,614,000 $ 111,726,000
Noninterest bearing 20,077,000 19,577,000
------------- -------------
126,691,000 131,303,000
Accrued interest and other liabilities 640,000 521,000
Income taxes payable 103,000 678,000
------------- -----------
127,434,000 132,502,000
------------- -----------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Common stock, par value $10 per share; 100,000
shares authorized, issued and outstanding 1,000,000 1,000,000
Surplus 8,000,000 8,000,000
Retained earnings 10,433,000 8,552,000
------------- ------------
Total stockholders' equity 19,433,000 17,552,000
------------- ------------
$ 146,867,000 $ 150,054,000
============= =============
See notes to financial statements
</TABLE>
<PAGE>
FIRST STATE BANK AND TRUST COMPANY
STATEMENTS OF INCOME
Three Years Ended December 31, 1993
<TABLE>
<CAPTION>
1993 1992 1991
------- -------- -------
Interest income on:
<S> <C> <C> <C>
Loans $ 4,696,000 $ 4,650,000 $ 4,797,000
Securities held to maturity 5,088,000 5,925,000 5,738,000
Federal funds sold 156,000 254,000 673,000
------------- ------------- -------------
9,940,000 10,829,000 11,208,000
Interest expense on:
Deposits 3,695,000 5,022,000 6,685,000
------------- ------------- -------------
Net interest income 6,245,000 5,807,000 4,523,000
Provision for possible loan losses 364,000 545,000 1,200,000
------------- ------------- -------------
Net interest income after provision for
possible loan losses 5,881,000 5,262,000 3,323,000
------------- ------------- -------------
Other income:
Service fees 700,000 699,000 675,000
Other 563,000 418,000 369,000
------------- ------------- -------------
1,263,000 1,117,000 1,044,000
------------- ------------- -------------
Other expenses:
Salaries and wages 1,471,000 1,433,000 1,304,000
Profit-sharing and other employee benefits 576,000 549,000 356,000
Occcupancy expenses 792,000 768,000 837,000
Other operating expenses 1,293,000 1,265,000 1,333,000
------------- ------------- -------------
4,132,000 4,015,000 3,830,000
------------- ------------- -------------
Income before federal income tax expense
and extraordinary item 3,012,000 2,364,000 537,000
------------- ------------- -------------
Federal income tax
Current expense 1,031,000 849,000 152,000
Tax effect of loss carryforward realized - - 105,000
------------- ------------- -------------
Income before extraordinary item 1,981,000 1,515,000 280,000
Extraordinary item, reduction of income taxes arising
from realization of loss carryforward - - (105,000)
------------- ------------- --------------
Net income $ 1,981,000 $ 1,515,000 $ 385,000
============= ============= ==============
Earnings per share $ 19.81 $ 15.15 $ 3.85
============= ============= ==============
See notes to financial statements
</TABLE>
<PAGE>
FIRST STATE BANK AND TRUST COMPANY
STATEMENTS OF STOCKHOLDERS' EQUITY
Three Years Ended December 31, 1993
<TABLE>
<CAPTION>
Common Stock
--------------------- Retained
Shares Par Value Surplus Earnings Total
------ ----------- --------- ----------- --------
<S> <C> <C> <C> <C> <C>
Balance, December 31, 1990 100,000 1,000,000 $ 8,000,000 6,852,000 15,852,000
Net income - - - 385,000 385,000
Cash dividends declared
($1.00 per share) - - - (100,000) (100,000)
------- ----------- ----------- ------------- -------------
Balance, December 31, 1991 100,000 $ 1,000,000 $ 8,000,000 7,137,000 $ 16,137,000
Net Income - - - 1,515,000 1,515,000
Cash dividends declared
($1.00 per share) - - - (100,000) (100,000)
------- ----------- ----------- ------------- -------------
Balance, December 31,1992 100,000 $ 1,000,000 $ 8,000,000 $ 8,552,000 $ 17,552,000
Net income - - - 1,981,000 1,981,000
Cash dividends declared
($1.00 per share) - - - (100,000) (100,000)
------- ----------- ----------- ------------ ------------
Balance, December 31,1993 100,000 $ 1,000,000 $ 8,000,000 $ 10,433,000 $ 19,433,000
======= =========== =========== ============ ============
See notes to financial statements
</TABLE>
<PAGE>
FIRST STATE BANK AND TRUST COMPANY
STATEMENTS OF CASH FLOWS
Three Years Ended December 31, 1993
<TABLE>
<CAPTION>
1993 1992 1991
------- ------- -------
CASH FLOWS FROM OPERATING ACTIVITIES
<S> <C> <C> <C>
Net Income $ 1,981,000 $ 1,515,000 $ 385,000
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation 341,000 323,000 386,000
Provision for possible loan loss 364,000 545,000 1,200,000
Gain on sale of other real estate (281,000) (13,000) -
Amortization of bond premiums 154,000 96,000 21,000
Write down of other real estate 56,000 145,000 -
Loss on disposal of equipment 15,000 - -
(Increase) Decrease in accrued income
receivable and other assets 201,000 136,000 (348,000)
Increase (decrease) in accrued interest
and other liabilities (456,000) 160,000 416,000
------------- ------------- -------------
Net cash provided by
operating activities 2,375,000 2,907,000 2,060,000
------------- ------------- -------------
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sales of investment securities 35,257,000 38,973,000 30,750,000
Purchase of investment securities (31,188,000) (43,900,000) (55,141,000)
Federal funds sold, net 500,000 4,350,000 (3,800,000)
(Increase) in loans (4,708,000) (4,979,000) (2,503,000)
Purchases of premises and equipment (352,000) (22,000) (660,000)
Proceeds from sale of other real estate 574,000 194,000 -
------------- ------------- -------------
Net cash provided by (used in
investing activities 83,000 (5,384,000) (31,354,000)
------------- ------------- -------------
CASH FLOWS FROM FINANCING ACTIVITIES
Net increase (decrease) in interest-bearing deposits (5,112,000) 2,657,000 14,686,000
Net increase in noninterest-bearing deposits 500,000 2,366,000 919,000
Dividends paid (100,000) (100,000) (100,000)
------------- ------------- -------------
Net cash provided by (used in)
financing activities (4,712,000) 4,923,000 15,505,000
------------- ------------- -------------
Increase (decrease) in cash and due from banks (2,254,000) 2,446,000 (13,789,000)
Cash and due from banks:
Beginning 8,531,000 6,085,000 19,874,000
------------- --------------- -------------
Ending $ 6,277,000 $ 8,531,000 $ 6,085,000
============= ============== =============
SUPPLEMENTAL DISCLOSURES OF
CASH FLOW INFORMATION
Cash payments for:
Interest paid to depositors $ 3,521,000 $ 5,195,000 $ 6,769,000
Income taxes $ 950,000 $ 184,000 $ (44,000)
SUPPLEMENTAL SCHEDULE OF NONCASH
INVESTING AND FINANCING ACTIVITIES
Other real estate acquired in $ 455,000 $ 221,000 $ 539,000
supplement of loans
Bank premises and equipment
reclassified to other assets $ - $ 473,000 $ -
See notes to financial statements
</TABLE>
<PAGE>
FIRST STATE BANK AND TRUST
COMPANY
NOTES TO FINANCIAL STATEMENTS
Note 1. Summary of Significant Accounting Policies
Presentation of cash flows:
For purposes of reporting cash flows, cash and due from banks includes
cash on hand and amounts due from banks (including cash items in process
of clearing). Cash flows from loans originated by the Bank, deposits,
and federal funds purchased and sold are reported net.
Securities held to maturity:
Securities classified as held to maturity are those debt securities the
Bank has both the intent and ability to hold to maturity regardless of
changes in market conditions, liquidity needs or changes in general
economic conditions. These securities are carried at cost adjusted for
amortization of premium and accretion of discount, computed by the
interest method over their contractual lives. It is the intent of
management to hold all investment securities until maturity.
Loans:
Loans are stated at the amount of unpaid principal, reduced by unearned
discount and fees and an allowance for possible loan losses.
The allowance for possible loan losses is maintained at a level
considered adequate to provide for losses that can be reasonably
anticipated. The allowance is increased by provisions charged to
operating expense and reduced by net charge-offs. The Bank makes
continuous credit reviews of the loan portfolio and considers current
economic conditions, historical loan loss experience, review of specific
problem loans and other factors in determining the adequacy of the
allowance balance.
Unearned interest on discounted loans is amortized to income over the
life of the loans, using the interest method. For all other loans,
interest is accrued daily on the outstanding balances. Accrual of
interest is discontinued on a loan when management believes, after
considering collection efforts and other factors, that the borrower's
financial condition is such that collection of interest is doubtful.
Loan origination and commitment fees and certain direct loan origination
costs are being deferred and the net amount amortized as an adjustment
of the related loan's yield. The Bank is generally amortizing these
amounts over the contractual life.
Postretirement benefits:
The Bank does not pay any postretirement benefits.
Off balance sheet financial instruments:
In the ordinary course of business, the Bank has entered into off balance
sheet financial instruments consisting of commitments to extend credit,
commitments under credit card arrangements, commercial letters of credit
and standby letters of credit. Such financial instruments are recorded
in the financial statements when they become payable.
Fair values of financial instruments:
FASB Statement No. 107, "Disclosures About Fair Value of Financial
Instruments," requires disclosure of fair value information about
financial instruments, whether or not recognized in the balance sheet,
for which it is practicable to estimate that value. In cases where
quoted market prices are not available, fair values are based on
estimates using present value or other valuation techniques. Those
techniques are significantly affected by the assumptions used, including
the discount rate and estimates of future cash flows. In that regard,
the derived fair value estimates cannot be substantiated by comparison
to independent markets and, in many cases, could not be realized in
immediate settlement of the instrument. Statement 107 excludes certain
financial instruments and all nonfinancial instruments from its
disclosure requirements. Accordingly, the aggregate fair value amounts
presented do not represent the underlying value of the Bank.
The following methods and assumptions were used by the Bank in estimating
its fair value disclosures for financial instruments:
Cash and due from banks: The carrying amounts reported in the balance
sheet for cash and short-term instruments approximate those assets' fair
values.
Investment securities: Fair values for investment securities are based
on quoted market prices, where available. If quoted market prices are
not available, fair values are based on quoted market prices of
comparable instruments.
Loans receivable: For variable-rate loans that reprice frequently and
with no significant change in credit risk, fair values are based on
carrying values. The fair values for other loans, e.g., commercial real
estate and rental property mortgage loans, commercial and industrial
loans, automobile loans, and agricultural loans, are estimated using
discounted cash flow analyses, using interest rates currently being
offered for loans with similar terms to borrowers of similar credit
quality. The carrying amount of accrued interest approximates its fair
value.
Commitments to extend credit and standby letters of credit: The fair
value of commitments is estimated using the fees currently charged to
enter into similar agreements, taking into account the remaining terms
of the agreements and the present creditworthiness of the counterparties.
For fixed-rate loan commitments, fair value also considers the difference
between current levels of interest rates and the committed rates. The
fair value of letters of credit is based on fees currently charged for
similar agreements or on the estimated cost to terminate them or
otherwise settle the obligations with the counterparties at the reporting
date.
Deposit liabilities: The fair values disclosed for demand deposits,
e.g., interest and noninterest checking, passbook savings, and certain
types of money market accounts, are, by definition, equal to the amount
payable on demand at the reporting date, i.e., their carrying amounts.
Fair values for fixed-rate certificates of deposit are estimated using
a discounted cash flow calculation that applies interest rates currently
being offered on certificates to a schedule of aggregated expected
monthly maturities on time deposits.
Bank premises and equipment:
Bank premises and equipment are stated at cost less accumulated
depreciation. Depreciation is computed principally by the straight-line
method over the following estimated useful lives:
Years
-----
Buildings and improvements 33
Furniture and equipment 3-10
Earnings per share:
Earnings per share are calculated on the basis of the weighted average
number of shares outstanding.
Income taxes:
The provision for income taxes relates to items of revenue and expenses
recognized for financial accounting purposes during each of the years.
The actual current tax liability may be less than the charge against
earnings due to the effect of certain items of revenue that are not
taxable.
Note 2. Restriction on Cash and Due From Banks
The Bank is required to maintain average reserve balances with the
Federal Reserve Bank based on a percentage of deposits. The average
balance maintained for such purposes was $1,000,000 for the years ended
December 31, 1993 and 1992.
Note 3. Investment Securities
Carrying amounts and fair values of securities being held to maturity as
of December 31, 1993 and 1992 are as follows:
<TABLE>
<CAPTION>
December 31, 1993
-------------------------------------------------------------------
Gross Gross Estimated
Amortized Unrealized Unrealized Market
Cost Gains Losses Value
--------- ---------- ---------- ---------
<S> <C> <C> <C> <C>
U. S. Treasury securities $46,234,000 $ 590,000 $27,000 $46,797,000
U. S. government agencies and
corporations 38,926,000 444,000 66,000 39,304,000
States and political subdivisions 190,000 13,000 - 203,000
----------- ----------- ------- -----------
$85,350,000 $1,047,000 $93,000 $86,304,000
=========== ========== ======= ===========
</TABLE>
<TABLE>
<CAPTION>
December 31, 1992
-----------------------------------------------------------------
Gross Gross Estimated
Amortized Unrealized Unrealized Market
Cost Gains Losses Value
--------- ---------- ---------- ---------
<S> <C> <C> <C> <C>
U. S. Treasury securities $53,029,000 $ 825,000 $57,000 $53,797,000
U. S. government agencies and
corporations 35,953,000 849,000 22,000 36,780,000
States and political subdivisions 591,000 19,000 - 610,000
----------- ----------- ------- -----------
$89,573,000 $1,693,000 $79,000 $91,187,000
=========== ========== ======= ===========
</TABLE>
The amortized cost and estimated market value of debt securities at
December 31, 1993, by contractual maturity, are shown below. Expected
maturities will differ from contractual maturities because borrowers may
have the right to call or prepay obligations with or without call or
prepayment penalties.
<TABLE>
<CAPTION>
Estimated
Amortized Market
Cost Value
--------- ---------
<S> <C> <C>
Due in one year or less $32,103,000 $32,345,000
Due after one year through five years 53,247,000 53,959,000
----------- -----------
$85,350,000 $86,304,000
=========== ===========
</TABLE>
There were no sales of investments in debt securities during the years
ended December 31, 1993, 1992 or 1991. Investment securities with a
carrying amount of $4,479,000 and $4,571,000 at December 31, 1993 and
1992, respectively, were pledged as collateral on public deposits.
Note 4. Loans
The composition of net loans is as follows:
<TABLE>
<CAPTION>
December 31,
---------------------------
1993 1992
---------- ------------
<S> <C> <C>
Commercial and agricultural $10,729,000 $13,946,000
Installment 11,731,000 12,724,000
Real estate 26,736,000 18,358,000
----------- -----------
49,196,000 45,028,000
Deduct:
Unearned discount 58,000 102,000
Allowance for loan losses 1,229,000 1,294,000
----------- ------------
$47,909,000 $43,632,000
=========== ===========
</TABLE>
Nonaccruing loans (principally real estate loans) totaled $1,108,000,
$0 and $627,000 at December 31, 1993, 1992 and 1991, respectively, which
had the effect of reducing net income $44,059, $0 and $70,000 ($.44, $0
and $.70 per common share) for the respective years then ended. Interest
income on these loans, which is recorded only when received, amounted to
$0, $0 and $0 for the years ended December 31, 1993, 1992 and 1991,
respectively.
The fair value of all loans at December 31, 1993, is estimated to be
approximately $49,699,000.
Note 5. Allowance for Possible Loan Losses
Changes in the allowance for possible loan losses are as follows:
<TABLE>
<CAPTION>
Years Ended December 31,
------------------------
1993 1992
-------- ---------
<S> <C> <C>
Balance, beginning of year $1,294,000 $1,151,000
Provision charged to operations 364,000 545,000
Loans charged off (989,000) (957,000)
Recoveries 560,000 555,000
---------- -----------
Balance, end of year $1,229,000 $1,294,000
========== ==========
</TABLE>
Note 6. Bank Premises and Equipment
The major classes of bank premises and equipment and the total
accumulated depreciation are as follows:
<TABLE>
<CAPTION>
December 31,
-----------------------
1993 1992
------ -------
<S> <C> <C>
Land $ 320,000 $ 320,000
Buildings and improvements 1,905,000 1,876,000
Furniture and equipment 1,948,000 1,835,000
----------- -----------
4,173,000 4,031,000
Less accumulated depreciation 2,529,000 2,384,000
----------- -----------
$ 1,644,000 $ 1,647,000
=========== ===========
</TABLE>
Note 7. Deposits
The composition of deposits is as follows:
<TABLE>
<CAPTION>
December 31,
----------------------------
1993 1992
---------- -------
<S> <C> <C>
Demand $ 20,078,000 $ 19,577,000
NOW accounts 9,411,000 9,501,000
Savings 47,754,000 40,479,000
Time, $100,000 and over 10,114,000 16,479,000
Other time 39,334,000 45,267,000
------------ ------------
$126,691,000 $131,303,000
============ ============
</TABLE>
The fair market value of deposit liabilities at December 31, 1993, is
estimated to be approximately $126,928,000.
Note 8. Profit-Sharing Plan
The Bank has a contributory profit-sharing plan which covers all
employees from date of employment. The plan provides for contributions
by the Bank, not to exceed 15% of the annual compensation of the
participants. The Bank's contributions to the plan were $243,000,
$234,000 and $100,000 for the years 1993, 1992 and 1991, respectively.
Note 9. Federal Income Tax
The components of income tax expense are as follows:
<TABLE>
<CAPTION>
Years Ended December 31,
---------------------------
1993 1992 1991
----------- -------- --------
<S> <C> <C> <C>
Currently paid or payable $ 976,000 $835,000 $308,000
Deferred 55,000 14,000 (156,000)
----------- -------- --------
$1,031,000 $849,000 $152,000
=========== ======== ========
</TABLE>
A reconciliation of the expected income tax expense computed at 34% in
1993, 1992 and 1991, to the income tax expense included in the
statements of income is as follows:
<TABLE>
<CAPTION>
Years Ended December 31,
---------------------------
1993 1992 1991
--------- -------- --------
<S> <C> <C> <C>
Computed "expected" tax expense $1,024,000 $804,000 $183,000
Tax exempt interest (15,000) (12,000) (23,000)
Other 22,000 57,000 (8,000)
---------- -------- --------
$1,031,000 $849,000 $152,000
========== ======== ========
</TABLE>
The deferred income tax provision consists of the following items:
<TABLE>
<CAPTION>
Years Ended December 31,
---------------------------
1993 1992 1991
------- ------- ------
<S> <C> <C> <C>
Accretion of discount recognized for
financial statements but not recognized
for income tax purposes until realized $24,000 $33,000 $ (24,000)
Difference between the depreciation
methods used for financial statements
and for income tax purposes (9,000) (3,000) (27,000)
Difference between loan loss provision
charged to operating expense and
the bad debt deduction taken for income
tax purposes (68,000) (38,000) (135,000)
Difference between the gain on sale of
other real estate used for financial
statements and for income tax purposes 78,000 - -
Difference between loan origination income
and expense methods used for financial
statements and for income tax purposes 30,000 22,000 30,000
------- ------- -----------
$55,000 $14,000 $(156,000)
======= ======= ============
</TABLE>
Note 10. Transactions With Directors and Officers
The Bank has had, and may be expected to have in the future, banking
transactions in the ordinary course of business with directors, principal
officers, their immediate families and affiliated companies in which they
are principal stockholders (commonly referred to as related parties), all
of which have been, in the opinion of management, on the same terms,
including interest rates and collateral, as those prevailing at the time
for comparable transactions with others. These related parties were
indebted to the Bank in the aggregate amount of $1,479,000, $1,821,000
and $1,857,000 at December 31, 1993, 1992 and 1991, respectively. This
group had deposits in the Bank of $2,106,000, $1,694,000 and $1,665,000
at December 31, 1993, 1992 and 1991, respectively.
Note 11. Contingent Liabilities and Commitments
The Bank's financial statements do not reflect various commitments and
contingent liabilities which arise in the normal course of business and
which involve elements of credit risk, interest rate risk and liquidity
risk. These commitments and contingent liabilities are commitments to
extend credit, credit card arrangements, and standby letters of credit.
A summary of the Bank's commitments and contingent liabilities at
December 31, 1993, is as follows:
Notional Amount
---------------
Commitments to extend credit $3,710,000
Credit card arrangements 867,000
Standby letters of credit 918,000
----------
$5,495,000
==========
Commitments to extend credit, credit card arrangements, and standby
letters of credit all include exposure to some credit loss in the event
of nonperformance of the customer. The Bank's credit policies and
procedures for credit commitments and financial guarantees are the same
as those for extension of credit that are recorded on the statements of
condition. Because these instruments have fixed maturity dates, and
because many of them expire without being drawn upon, they do not
generally present any significant liquidity risk to the Bank. The Bank's
experience has been that approximately 20% of loan commitments are drawn
upon by customers. The bank has not been required to perform any
financial guarantees during the past two years. The Bank has not
incurred any losses on its commitments in either 1993 or 1992. The fair
value of these commitments and contingent liabilities at December 31,
1993, is estimated to approximate their notional amounts.
The Bank is party to litigation and claims arising in the normal course
of business. Management, after consultation with legal counsel, believes
that the liabilities, if any, arising from such litigation and claims
will not be material to the financial position of the Bank.
Note 12. Concentrations of Credit
All of the Bank's loans, commitments, and standby letters of credit have
been granted to customers in the Bank's market area. All such customers
are depositors of the Bank. Investments in state and municipal
securities also involve governmental entities within the state of
Louisiana. The concentrations of credit by type of loan are set forth
in Note 4. The distribution of commitments to extend credit approximates
the distribution of loans outstanding. Standby letters of credit were
granted primarily to commercial borrowers. The Bank, as a matter of
policy, does not extend credit to any single borrower or group of related
borrowers in excess of $1,000,000.
Note 13.Regulatory Matters
The Bank, as a state Bank is subject to the dividend restrictions set
forth by the Office of Financial Institutions of the state of Louisiana
(OFI). Under such restrictions, the Bank may not, without the prior
approval of the OFI, declare dividends in excess of the sum of the
current year's earnings (as defined) plus the retained earnings (as
defined) from the prior years. The dividends, as of December 31, 1993,
that the Bank could declare, without the approval of the OFI, amounted
to approximately $3,296,000. The Bank is also required to maintain
minimum amounts of capital to total "risk weighted" assets, as defined
by the banking regulators. At December 31, 1993, the Bank is required
to have minimum Tier 1 and total capital ratios of 4.0% and 8.0%,
respectively. The Bank's actual ratios at that date were 33.50% and
34.76%, respectively. The Bank's leverage ratio at December 31, 1993,
was 13.14%. According to FDIC capitol guidelines, the Bank is considered
to be "well capitalized."
<PAGE>
FIRST STATE BANK AND TRUST COMPANY
BALANCE SHEETS
Unaudited (in thousands)
<TABLE>
<CAPTION>
June 30
-------------------------
1994 1993
-------- -------
ASSETS
<S> <C> <C>
Cash and due from banks $6,880 $5,903
Securities held to maturity 84,076 87,629
Federal funds sold 6,500 3,350
Loans, net 47,842 45,142
Bank premises and equipment, net 1,511 1,531
Accrued income receivable 1,336 1,644
Other assets 1,541 1,653
-------- --------
Total assets $149,686 $146,852
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Deposits:
Interest bearing $106,288 $109,635
Noninterest bearing 22,648 18,245
-------- --------
128,936 127,880
Accrued interest and other liabilities 592 598
Income taxes payable 130 58
-------- --------
Total liabilities 129,658 128,536
-------- --------
STOCKHOLDERS' EQUITY
Common stock, par value $10 per share; 100,000
shares authorized, issued and outstanding 1,000 1,000
Surplus 8,000 8,000
Retained earnings 11,028 9,316
-------- --------
20,028 18,316
-------- --------
Total liabilities and stockholders' equity $149,686 $146,852
======== ========
See notes to financial statements
</TABLE>
<PAGE>
FIRST STATE BANK AND TRUST COMPANY
STATEMENTS OF INCOME
Unaudited (in thousands)
<TABLE>
<CAPTION>
June 30
-----------------------
1994 1993
------ ------
<S> <C> <C>
Interst income on:
Loans $2,214 $2,255
Securities held to maturity 2,189 2,653
Federal funds sold 117 75
------ ------
4,520 4,983
Interest expense on:
Deposits 1,640 1,968
------ ------
Net interest income 2,880 3,015
Provision for possible loan losses 525 450
------ ------
Net interest income after provision for 2,355 2,565
possible loan losses ------ ------
Other income:
Service fees 355 346
Other 195 174
------ ------
550 520
------ ------
Other expenses:
Salaries and wages 711 710
Profit-sharing and other employee benefits 87 107
Occupancy expenses 331 377
Other operating expenses 549 536
------ ------
1,678 1,730
------ ------
Income before federal income tax expense 1,227 1,355
Federal income tax 632 591
------ ------
Net income $595 $764
====== ======
Earnings per share $5.95 $7.64
====== ======
See notes to financial statements
</TABLE>
<PAGE>
<TABLE>
FIRST STATE BANK AND TRUST COMPANY
STATEMENTS OF STOCKHOLDERS' EQUITY
Unaudited ($ in thousands)
<CAPTION>
Common Stock
--------------------------- Retained
6 Months Ended June 30, 1994 Shares Par Value Surplus Earnings Total
------ ------------- ------- -------- --------
<S> <C> <C> <C> <C> <C>
Balance, December 31, 1993 100,000 $1,000 $8,000 $10,433 $19,433
Net Income - - - 595 595
------- ------ ------ ------- -------
Balance, June 30, 1994 100,000 $1,000 $8,000 $11,028 $20,028
======= ====== ====== ======= =======
</TABLE>
<TABLE>
<CAPTION>
Common Stock
-------------------------- Retained
6 Months Ended June 30, 1993 Shares Par Value Surplus Earnings Total
------ ------------ -------- -------- -------
<S> <C> <C> <C> <C> <C>
Balance, December 31, 1992 100,000 $1,000 $8,000 $8,552 $17,552
Net Income - - - 764 764
------- ------ ------ ------ -------
Balance, June 30, 1993 100,000 $1,000 $8,000 $9,316 $18,316
======= ====== ====== ====== =======
</TABLE>
<PAGE>
FIRST STATE BANK AND TRUST COMPANY
STATEMENTS OF CASH FLOWS
Unaudited (in thousands)
<TABLE>
<CAPTION>
6 Months Ended
June 30
CASH FLOWS FROM OPERATING ACTIVITIES 1994 1993
------ ------
<S> <C> <C>
Net income $595 $764
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation 108 143
Provision for possible loan losses 525 450
Amortization (accretion) of bond premiums (discounts) (6) 88
Decrease in accrued income
receivable and other assets 241 304
Decrease in accrued interest
and other liabilities (21) (543)
-------- ---------
Net cash provided by operating activities 1,442 1,206
-------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sales of investment securities 23,050 17,597
Purchase of investment securities (21,770) (15,741)
Federal funds sold, net (3,950) (300)
Net increase in loans (458) (1,960)
Purchases of premises and equipment (48) (48)
Proceeds from sale of other real estate owned 20 20
Proceeds from sales of premises and equipment 72 21
------- --------
Net cash used in investing activities (3,084) (411)
------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Net decrease in interest-bearing deposits (326) (2,091)
Net increase (decrease) in noninterest-bearing deposits 2,571 (1,332)
------- --------
Net cash provided by (used in)
financing activities 2,245 (3,423)
-------- --------
Increase (decrease) in cash and due from banks 603 (2,628)
Cash and due from banks:
Beginning 6,277 8,531
------- --------
Ending $6,880 $5,903
======= ========
See notes to financial statements.
</TABLE>
<PAGE>
FIRST STATE BANK AND TRUST COMPANY
BOGALUSA, LA
Notes to Consolidated Financial Statements
NOTE 1 - Per Share Data and Market Value of Stock
Net income per average share outstanding is calculated based on the
weighted average number of shares outstanding during the year. The
average number of shares outstanding for the six months ending June
30, 1994 and 1993 was 100,000 and 100,000 respectively.
NOTE 2 - Non-Performing Loans
(in thousands) JUNE 30
1994 1993
---- ----
Nonaccrual loans $ 833 $ 246
Restructured loans - -
----- -----
Total nonperforming loans $ 833 $ 246
===== =====
Accruing loans past due
ninety days or more $ 36 $ 447
===== =====
When the payment of principal and interest on a loan is delinquent
for 90 days or earlier in some cases, the loan is placed on
nonaccrual status unless the loan is in process of collection and
the underlying collateral fully supports the carrying value of the
loan. If the decision is made to continue accrual of interest on
the loan, periodic reviews are made to confirm the accruing status
of the loan. When a loan is placed on nonaccrual any accrued
interest is charged directly against the interest income account.
Any payments received on nonaccruals are applied first to the
outstanding principal balance and after satisfaction of principal
recovery of interest is considered.
Interest income in the amount of $47,000 would have been recorded
on nonaccrual loans during the six months ended June 30, 1994 if
they had been performing in accordance with their contractual
terms. During the six months ended June 30, 1994, the company
recorded interest income on nonaccrual loans of $2,000.
In addition to the nonperforming loans disclosed above, management
has identified loans totaling $138,000 for which payments are
current, but which, in management's opinion, are subject to
potential future classification as non-performing or past due.
APPENDIX A
AGREEMENT AND PLAN OF MERGER
OF
FIRST STATE BANK AND TRUST COMPANY
WITH AND INTO
HIBERNIA NATIONAL BANK
AGREEMENT AND PLAN OF MERGER dated as of August 18, 1994
(this "Agreement"), adopted and made between and among First
State Bank and Trust Company of Bogalusa ("First State"),
Hibernia National Bank ("HNB") and Hibernia Corporation
("Hibernia").
First State is a Louisiana banking association duly
organized and existing under the laws of the State of Louisiana
and has its registered office at 346 Columbia Street, Bogalusa,
Louisiana 70427. The presently authorized capital stock of First
State consists solely of 100,000 shares of common stock of the
par value of $10.00 each ("First State Common Stock"). As of
June 30, 1994, 100,000 shares of First State Common Stock had
been issued, 100,000 shares of First State Common Stock were
outstanding, and no shares of First State Common Stock were held
in First State's treasury. All outstanding shares of First State
Common Stock have been duly issued and are validly outstanding,
fully paid and nonassessable. The foregoing are the only voting
securities of First State authorized, issued, or outstanding, and
there are no existing options, warrants, calls, or commitments of
any kind obligating First State to issue any share of its capital
stock or any other security of which it is or will be the issuer.
None of the shares of First State's capital stock has been issued
in violation of preemptive rights of shareholders.
Hibernia is a corporation duly organized and existing under
the laws of the State of Louisiana; has its registered office at
313 Carondelet Street, New Orleans, Louisiana 70130; and is a
bank holding company within the meaning of the Bank Holding
Company Act. Hibernia owns all of the issued and outstanding
shares of capital stock of Hibernia National Bank ("HNB"). The
presently authorized capital stock of Hibernia is 300,000,000
shares, consisting of 100,000,000 shares of preferred stock, no
par value, and 200,000,000 shares of Class A voting common stock,
no par value (the Class A voting common stock being referred to
hereinafter as "Hibernia Common Stock"). As of June 30, 1994, no
shares of Hibernia's preferred stock or were outstanding,
83,717,760 shares of Hibernia Common Stock were outstanding, and
no shares of Hibernia Common Stock were held in Hibernia's
treasury. All outstanding shares of Hibernia Common Stock have
been duly issued and are validly outstanding, fully paid and
nonassessable. The foregoing are the only voting securities of
Hibernia authorized, issued or outstanding and there are no
existing options, warrants, calls or commitments of any kind
obligating Hibernia to issue any share of its capital stock or
any other security of which it is or will be the issuer, except
that Hibernia has authorized or reserved 1,718,707 shares of
Hibernia Common Stock for issuance under its 1987 Stock Option
Plan, pursuant to which options covering 1,557,491 shares of
Hibernia Common Stock were outstanding as of June 30, 1994,
3,660,087 (as adjusted) shares of Hibernia Common Stock for
issuance under its 1992 Long-Term Incentive Plan, pursuant to
which options covering 2,505,055 shares of Hibernia Common Stock
were outstanding as of June 30, 1994, 1,000,000 shares of
Hibernia Common Stock for issuance under its 1993 Director Stock
Option Plan, pursuant to which options covering 155,000 shares of
Hibernia Common Stock are outstanding on the date hereof, 574,147
shares of Hibernia Common Stock are available for issuance
pursuant to Hibernia's Dividend Reinvestment and Stock Purchase
Plan. Mergers that have been consummated with Commercial
Bancshares, Inc., Bastrop National Bank, First Bancorp of
Louisiana, Inc. and First Continental Bancshares, Inc. will
result in the issuance of an aggregate of approximately
13,021,494 shares. A pending merger with Pioneer Bancshares
Corporation will result in the issuance of an estimated
approximately 8.4 million shares of Hibernia Common Stock. None
of the shares of Hibernia's capital stock has been issued in
violation of preemptive rights of shareholders.
HNB is a national banking association organized and existing
under the laws of the United States of America having its
principal registered office at 313 Carondelet Street, New
Orleans, Louisiana 70130. All of the issued and outstanding
shares of capital stock of HNB are owned by Hibernia. HNB is (i)
an "insured bank" as defined in the Federal Deposit Insurance Act
and applicable regulations thereunder, and (ii) has been duly
organized and is validly existing as a national bank under the
laws of the United States, and has full authority to conduct its
business as and where currently conducted.
The Boards of Directors of First State, HNB and Hibernia
have duly approved this Agreement and have authorized the
execution hereof by their respective undersigned officers. First
State has directed that this Agreement be submitted to a vote of
its shareholders in accordance with Part XI of the Louisiana
Business Corporation Law ("LBCL") and the terms of this
Agreement.
In consideration of their mutual promises and obligations,
the parties hereto adopt and make this Agreement for the merger
of First State with and into Hibernia and prescribe the terms and
conditions of such merger and the mode of carrying it into
effect, which shall be as follows:
1. The Merger. On the Effective Date (as defined in
Section 14 hereof), First State shall be merged with and into HNB
under the Articles of Association of HNB, pursuant to the
provisions of, and with the effect provided in, 12 U.S.C. Section
215a (the "Bank Merger Act") (the "Merger") and the Merger
Agreement in substantially the form of Exhibit 1 hereto (the
"Merger Agreement").
2. Hibernia Capital Stock. The shares of the capital
stock of Hibernia issued and outstanding immediately prior to the
Effective Date shall, on the Effective Date, continue to be
issued and outstanding.
3. First State Common Stock.
3.1. Conversion. On the Effective Date and subject to
the provisions of Section 3.7 hereof,
(a) each share of First State Common Stock issued and
outstanding immediately prior to the Effective Date, other than
(i) shares as to which dissenters' rights have been perfected and
not withdrawn or otherwise forfeited under Section 12: 131 of the
LBCL and (ii) shares owned beneficially by Hibernia or its
subsidiaries, shall, by virtue of the Merger automatically and
without any action on the part of the holder thereof, become and
be converted into the number of shares of Hibernia Common Stock
that equals the Exchange Rate set forth in Section 3.8 hereof;
(b) holders of certificates which represent shares of
First State Common Stock outstanding immediately prior to the
Effective Date (hereinafter called "Old Certificates") shall
cease to be, and shall have no rights as, shareholders of First
State;
(c) each share of First State Common Stock held in the
treasury of First State or owned beneficially by Hibernia or any
of its subsidiaries shall be cancelled; and
(d) Old Certificates shall be exchangeable by the
holders thereof in the manner provided in the transmittal
materials described below for new certificates for the number of
whole shares of Hibernia Common Stock to which such holders shall
be entitled in accordance with the Exchange Rate set forth in
Section 3.8 and a check representing cash paid in lieu of
fractional shares as provided in Section 3.2 hereof.
3.2. Fractional Shares. Each holder of Old Certificates
who would otherwise have been entitled to receive a fraction of a
share of Hibernia Common Stock (after taking into account all
shares of First State Common Stock represented by the Old
Certificates then delivered by such holder) shall receive, in
lieu thereof, cash (without interest) in an amount equal to such
fractional part of a share multiplied by the average of the mean
of high and low prices of one share of Hibernia Common Stock for
the five business days preceding the Effective Date as reported
in The Wall Street Journal, or, if the Hibernia Common Stock is
not then so reported, the average of the fair market values of
one share of Hibernia Common Stock on the five business days
preceding the Effective Date determined pursuant to such
reasonable method as the Board of Directors of Hibernia may adopt
in good faith for such purpose, and no such holder shall be
entitled to dividends, voting rights or any other right of
shareholders in respect of any fractional share.
3.3. Transmittal Materials. As promptly as practicable
after the Effective Date, Hibernia shall send or cause to be sent
to each former shareholder of record of First State transmittal
materials for use in exchanging Old Certificates for certificates
representing Hibernia Common Stock and a check representing cash
paid in lieu of fractional shares, if any. The letter of
transmittal will contain instructions with respect to the
surrender of Old Certificates and the distribution of
certificates representing Hibernia Common Stock. If any
certificate for shares of Hibernia Common Stock is to be issued
in a name other than that in which an Old Certificate surrendered
for exchange is issued, the Old Certificate so surrendered shall
be properly endorsed and otherwise in proper form for transfer
and the person requesting such exchange shall affix any requisite
stock transfer tax stamps to the Old Certificate surrendered or
provide funds for their purchase or establish to the satisfaction
of the exchange agent to be appointed by Hibernia in connection
with such exchange (the "Exchange Agent") that such taxes are not
payable.
3.4. Rights as Shareholders. Former shareholders of First
State will be able to vote after the Effective Date at any
meeting of Hibernia shareholders or pursuant to any written
consent procedure the number of whole shares of Hibernia Common
Stock into which their shares of First State Common Stock are
converted, regardless of whether they have exchanged their Old
Certificates. Whenever a dividend is declared by Hibernia on the
Hibernia Common Stock after the Effective Date, the declaration
shall include dividends on all shares issuable hereunder, but no
shareholder will be entitled to receive his distribution of such
dividends until physical exchange of his Old Certificates shall
have been effected. Upon physical exchange of his Old
Certificates, any such person shall be entitled to receive from
Hibernia an amount equal to all dividends (without interest
thereon and less the amount of taxes, if any, that may have been
withheld, imposed or paid thereon) declared, and for which the
payment has occurred, on the shares represented thereby.
3.5. Cancellation of Old Certificates. On and after the
Effective Date there shall be no transfers on the stock transfer
books of First State or Hibernia of the shares of First State
Common Stock which were issued and outstanding immediately prior
to the Effective Date. If, after the Effective Date, Old
Certificates are properly presented to Hibernia, they shall be
cancelled and exchanged for certificates representing shares of
Hibernia Common Stock and a check representing cash paid in lieu
of fractional shares as herein provided. Any other provision of
this Agreement notwithstanding, neither the Exchange Agent nor
any party hereto shall be liable to a holder of First State
Common Stock for any amount paid or property delivered in good
faith to a public official pursuant to any applicable abandoned
property, escheat, or similar law.
3.6. Property Transfers. From time to time, as and when
requested by Hibernia and to the extent permitted by Louisiana
law, the officers and directors of First State last in office
shall execute and deliver such deeds and other instruments and
shall take or cause to be taken such further or other actions as
shall be necessary in order to vest or perfect in or to confirm
of record or otherwise to HNB title to, and possession of, all
the property, interests, assets, rights, privileges, immunities,
powers, franchises, and authorities of First State, and otherwise
to carry out the purposes of this Agreement.
3.7. Dissenters' Shares. Shares of First State Common
Stock held by any holder having rights of a dissenting
shareholder as provided in 12 U.S.C. Section 215a, who shall have
properly objected to the Merger and who shall have properly
demanded payment on his stock in accordance with and subject to
the provisions of 12 U.S.C. Section 215a, shall not be converted
as provided in Section 3.1 hereof until such time as such holder
shall have failed to perfect, or shall have effectively lost, his
right to appraisal of and payment for his shares of First State
Common Stock, at which time such shares shall be converted as
provided in Section 3.1 hereof.
3.8. Exchange Rate.
(a) Except as provided in paragraphs (b), (c) and (d)
below in this Section 3.8, the Exchange Rate shall be the number
that is obtained by dividing 3,350,000 by the total number of
issued and outstanding shares of First State Common Stock on the
Closing Date.
(b) In the event the Average Market Price of Hibernia
Common Stock (as defined below) is less than $7.75, the Exchange
Rate shall be calculated as follows: [$25,962,500 divided by the
Average Market Price of Hibernia Common Stock] divided by the
number of issued and outstanding shares of First State Common
Stock. In the event the Average Market Price of Hibernia Common
Stock (as defined below) is greater than $9.75, the Exchange
Rate shall be calculated as follows: [$32,662,500 divided by the
Average Market Price of Hibernia Common Stock] divided by the
number of issued and outstanding shares of First State Common
Stock.
(c) In the event the Merger is not consummated on or
before the last day of the month that is nine months after the
date of this Agreement, (the "Adjustment Period"), then, for each
full month ending after the Adjustment Period, the number of
shares of Hibernia Common Stock to be exchanged in the Merger
shall be calculated as follows: [(3,350,000 plus the net, after-
tax earnings of First State for each month ended after the
Adjustment Period) (the "Earnings Adjustment") divided by the
Average Market Price of Hibernia Common Stock]. In the event the
Average Market Price of Hibernia Common Stock is less than $7.75,
the adjustment described in the preceding sentence shall be
calculated on the basis of a total purchase price of $25,962,500,
plus the Earnings Adjustment, rather than a total number of
shares of Hibernia Common Stock to be exchanged. Similarly, in
the event the Average Market Price of Hibernia Common Stock is
greater than $9.75, the foregoing adjustment shall be made on the
basis of an aggregate purchase price of $32,662,500, plus the
Earnings Adjustment, rather than a specified number of shares of
Hibernia Common Stock to be exchanged.
(d) In the event Hibernia executes, prior to the
Effective Date, an agreement to merge with an unaffiliated third
party in a transaction in which Hibernia will not be the
surviving holding company, then the Exchange Rate shall be
calculated as set forth above in paragraphs (b) and (c) in this
Section 3.8, except that, in the event the Average Market Price
of Hibernia Common Stock is greater than $9.75, the minimum
number of shares to be issued in the Merger, regardless of the
actual Average Market Price of Hibernia Common Stock, shall be
2,969,318.
(e) For purposes of this Agreement, the Average
Market Price of Hibernia Common Stock on the Closing Date shall
be the average of the mean of the high and low prices of one
share of Hibernia Common Stock for the five business days
preceding the last trading day immediately prior to the Closing
Date as reported in The Wall Street Journal.
4. Articles of Incorporation; Bylaws. The Articles of
Incorporation and Bylaws of Hibernia in force immediately prior
to the Effective Date shall on and after the Effective Date
continue to be the Articles of Incorporation and Bylaws of
Hibernia, respectively, unless altered, amended or repealed in
accordance with applicable law.
5. Employees. Hibernia shall use its best efforts to
cause to be provided as soon as practicable after the Effective
Date for the employees of First State immediately prior to the
Effective Date the employee benefits then made available to
employees of Hibernia and its subsidiaries, subject to the terms
and conditions under which those employee benefits are made
available to such employees; provided, however, that for
purposes of determining the eligibility of an employee of First
State to receive, and the benefits to which such employee shall
be entitled, under Hibernia's benefits plans after the Effective
Date, any period of employment of such employee with First State
shall be deemed equivalent to having been employed for that same
period by Hibernia and/or its subsidiaries, and provided,
however, that if Hibernia determines in good faith that it cannot
merge any benefit plan of First State into a comparable benefit
plan of Hibernia or HNB without creating material potential
liability for Hibernia's or HNB's plan, then Hibernia shall be
entitled to freeze the existing benefit plan of First State and
prohibit participation by former employees of First State in
Hibernia's plan for the period of time required by applicable law
to ensure that Hibernia's and HNB's benefit plans are not deemed
to be success or plans of the First State plan in question.
6. Negative Covenants. From the date hereof until the
Effective Date, or until the termination of this Agreement, First
State covenants and agrees that it will not do, or agree to
commit to do, without the prior written consent of Hibernia, any
of the following:
(a) make, declare, set aside or pay any dividend or
declare or make any distribution on, or directly or indirectly
combine, redeem, purchase or otherwise acquire, any shares of
First State Common Stock (other than in a fiduciary capacity);
provided, however, that: (i) First State may pay an annual
dividend for 1994 equal to $1.00 per share (pro rated through the
Closing Date in the event the Closing occurs prior to December
31, 1994) during the month of December 1994 or January 1995
consistent in both timing and amount with past practice of First
State during the prior two years, and, (ii) First State may pay a
regular quarterly dividend beginning with the first fiscal
quarter of 1995, payable at the end of such quarter at the rate
of $.25 per share if and only if Hibernia concludes, prior to the
payment of such dividend, that the payment of any such quarterly
dividend will not jeopardize the treatment of the Merger as a
pooling of interests for accounting purposes, provided, however
that First State shall not pay a quarterly dividend any calendar
quarter ended immediately prior to the Closing Date if
shareholders of First State are eligible, as shareholders of
Hibernia following the Effective Date, to receive Hibernia's
regular cash dividend for the quarter ended prior to the
Effective Date;
(b) authorize the creation or issuance of or issue any
additional shares of its capital stock, or any options, calls,
warrants, stock appreciation rights or commitments relating to
its capital stock or any securities or obligations convertible
into or exchangeable for, or giving any person any right to
subscribe for or acquire from it, shares of its capital stock;
(c) enter into any employment contracts with, increase
the rate of compensation of, or except in accordance with the
existing policy (it being understood among the parties hereto
that Hibernia intends to enter into employment agreements with
Messrs. Mike Cassidy, Kenneth Smith, Nathan Bush, Earl Herrington
and Robert J. Puckett for a period of two years at their current
salaries and which agreements shall not constitute a breach of
this covenant by First State), or pay or agree to pay any bonus
to, any of its directors, officers or employees except in
accordance with existing policy and past practice in the two
years preceding such bonus;
(d) enter into or substantially modify (except as may
be required by applicable law) any pension, retirement, stock
option, stock purchase, stock appreciation right, 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; provided, however, that First State may adopt a
severance policy for its employees which applies to those
employees who will not have employment contracts with Hibernia
provides for a maximum of six months' severance pay in the case
of senior management and a maximum of four months' severance so
long as, prior to the payment of, or vesting of any obligation to
pay, any such severance Hibernia has determined that, in its good
faith opinion after consultation with such tax and accounting
professionals as it deems reasonable or appropriate, the payment
of severance pursuant to such policy would not adversely affect
the ability of Hibernia to account for the Merger as a pooling of
interests;
(e) other than as contemplated hereby, (i) carry on
its business other than in the usual, regular and ordinary course
in substantially the same manner as heretofore conducted, (ii)
amend its Articles of Association or Bylaws, (iii) impose, or
suffer the imposition, on any share of stock held by First State
in the Bank, of any material lien, charge, or encumbrance, or
permit any such lien to exist, (iv) establish or add any
automatic teller machines or branch or other banking offices, (v)
make any capital expenditures in excess of $100,000 or (vi) take
any action that would materially and adversely affect the ability
of any party hereto to obtain the approvals necessary for
consummation of the transactions contemplated hereby or that
would materially and adversely affect First State's ability to
perform its covenants and agreements hereunder;
(f) except with respect to transactions contemplated
hereby, merge with any other corporation or bank or permit any
other corporation or bank to merge into it or consolidate with
any other corporation or bank; acquire control over any other
firm, bank, corporation or organization or create any subsidiary
(except in a fiduciary capacity or in connection with
foreclosures in bona fide loan transactions); liquidate; or sell
or dispose of any assets or acquire any assets, otherwise than in
the ordinary course of its business consistent with its past
practice; or
(g) knowingly fail to comply with any laws,
regulations, ordinances, or governmental actions applicable to it
and to the conduct of its business in a manner significant,
material and adverse to its business.
7. Representations and Warranties of First State. First
State hereby represents and warrants as follows:
7.1. Recitals. The facts set forth in the preamble to
this Agreement with respect to it are true and correct.
7.2. Organization and Qualification. First State is a
bank duly organized, validly existing, and in good standing under
the laws of the State of Louisiana; has the corporate power and
authority to carry on its business as it is now being conducted
and to own, lease and operate its assets, properties and
business; and has all requisite power and authority to execute
and deliver this Agreement and perform its obligations hereunder.
7.3. Ownership of Other Banks and Subsidiaries;
Validity of Stock. First State does not own, directly or
indirectly, 5 percent or more of the outstanding capital stock or
other voting securities of any corporation, bank, or other
organization. Attached hereto as Exhibit 7.3 is a list of all
direct and indirect subsidiaries of First State, the officers and
directors of each and the business and purpose of each such
subsidiary. The outstanding shares of capital stock of First
State are validly issued and outstanding, fully paid and, except
as may be affected by Louisiana Revised Statute Section 6:262,
nonassessable.
7.4. Corporate Authorization. The execution, delivery
and performance of this Agreement have been authorized by First
State's Board of Directors, and, subject to the approval of this
Agreement by its shareholders in accordance with the Bank Merger
Act, all corporate acts and other proceedings required for the
due and valid authorization, execution, delivery and performance
by First State of this Agreement and the consummation of the
Merger have been validly and appropriately taken. Subject to
such shareholder approval and to such regulatory approvals as are
required by law, this Agreement is a legal, valid and binding
obligation of First State, enforceable against First State in
accordance with its terms, except that enforcement may be limited
by bankruptcy, reorganization, insolvency and other similar laws
and court decisions relating to or affecting the enforcement of
creditors' rights generally and by general equitable principles
or principles of Louisiana law that are similar to equitable
principles in jurisdictions that recognize a distinction between
law and equity.
7.5. No Conflicts. Except as disclosed on Schedule
7.5 hereto, the execution and delivery of this Agreement by First
State does not, and the consummation of the transactions
contemplated hereby by it will not, constitute (i) 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 First State or to which
First State is subject, which breach, violation or default would
have a material and adverse effect on the financial condition,
properties, businesses or results of operations of First State
and the Bank taken as a whole or on the transactions contemplated
hereby, (ii) to the best of the knowledge of First State's
management, 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 First State or to which First State is subject, or
(iii) a breach or violation of, or a default under, the Articles
of Association or Bylaws of First State; and the consummation of
the transactions contemplated hereby will not 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 required approvals of shareholders and
applicable regulatory authorities.
7.6. Financial Statements; Dividend Restrictions.
First State has delivered to Hibernia prior to the execution of
this Agreement true and correct copies of the following
consolidated financial statements (collectively referred to
herein as the "First State Financial Statements"): First State's
Consolidated Balance Sheets as of June 30, 1994 and 1993
(unaudited) and December 31, 1993, 1992 and 1991 (audited);
Consolidated Statements of Income and Changes in Stockholders'
Equity and Consolidated Statements of Cash Flows for the years
ended December 31, 1993, 1992 and 1991 (audited), and
Consolidated Statements of Income for the three-month periods
ended June 30, 1994 and 1993 (unaudited). Each of the First
State Financial Statements (including the related notes) fairly
presents the consolidated results of operations of First State
for the respective periods covered thereby and the consolidated
financial condition of First State as of the respective dates
thereof (subject, in the case of unaudited statements, to year-
end audit adjustments that will not be material in amount or
effect), in each case in accordance with GAAP consistently
applied during the periods involved, except as may be noted
therein. Except as disclosed in the First State Financial
Statements, including the notes thereto, or Schedule 7.6 hereto,
and except as otherwise required by this Agreement, there are no
restrictions in any note, indenture, agreement, statute or
otherwise (except for statutes or regulations applicable to
Louisiana corporations or state banks generally) precluding First
State from paying dividends, in each case when, as and if
declared by its Board of Directors.
7.7. No Material Adverse Change. Since June 30, 1994,
there has been no event or condition of any character (whether
actual, or to the knowledge of First State, threatened or
contemplated) that has had or can reasonably be anticipated to
have, or that, if concluded or sustained adversely to First
State, would reasonably be anticipated to have, a material
adverse effect on the financial condition, results of operations,
business or prospects of First State, excluding changes in laws
or regulations that affect banking institutions generally.
7.8. Litigation and Proceedings. Except as set forth
on Schedule 7.8 hereto, no litigation, proceeding or controversy
before any court or governmental agency is pending against First
State that in the opinion of its management is likely to have a
material and adverse effect on the business, results of
operations or financial condition of First State taken as a
whole, and, to the best of its knowledge, no such litigation,
proceeding or controversy has been threatened or is contemplated.
Except as disclosed on Schedule 7.8 hereto, no member of First
State's consolidated group is subject to any written agreement,
memorandum, or order with or by any bank or bank holding company
regulatory authority restricting its operations or requiring any
material actions.
7.9. Material Contracts. Except for this Agreement
and arrangements made in the ordinary course of business or
disclosed on Schedule 7.9 hereto, First State is not bound by any
material contract to be performed after the date hereof that is
not terminable by First State without penalty or liability on
thirty days prior notice.
7.10. Brokers' or Finders' Fees. No agent, broker,
investment banker, investment or financial advisor or other
person acting on behalf of First State or under their authority
is entitled to any commission, broker's or finder's fee from any
of the parties hereto in connection with any of the transactions
contemplated by this Agreement except that First State has
engaged Austin Associates, Inc. in connection with the Merger and
has agreed to compensate Austin Associates for such services. A
copy of the agreement by which First State has engaged Austin
Associates is attached hereto as Exhibit 7.10 and contains all
agreements between First State and Austin Associates relating to
services in connection with the Merger and compensation therefor.
7.11. Contingent Liabilities. Except as disclosed on
Schedule 7.11 hereto or as reflected in the First State Financial
Statements and except for unfunded loan commitments made in the
ordinary course of business consistent with past practices, as of
June 30, 1994, First State had no obligation or liability
(contingent or otherwise) that was material, or that when
combined with all similar obligations or liabilities would have
been material, to First State, and there does not exist a set of
circumstances resulting from transactions effected or events
occurring prior to, on, or after June 30, 1994, or from any
action omitted to be taken during such period that, to the
knowledge of First State, could reasonably be expected to result
in any such material obligation or liability.
7.12. Tax Liability. The amounts set up as
liabilities for taxes in the First State Financial Statements are
sufficient for the payment of all respective taxes (including,
without limitation, federal, state, local, and foreign excise,
franchise, property, payroll, income, capital stock, and sales
and use taxes) accrued in accordance with GAAP and unpaid at the
respective dates thereof.
7.13. Material Obligations Paid. Since June 30, 1994,
First State has not incurred or paid any obligation or liability
that would be material to First State on a consolidated basis,
except for obligations incurred or paid in connection with
transactions by it in the ordinary course of its business
consistent with its past practices.
7.14. Tax Returns; Payment of Taxes. All federal,
state, local, and foreign tax returns (including, without
limitation, estimated tax returns, withholding tax returns with
respect to employees, and FICA and FUTA returns) required to be
filed by or on behalf of First State have been timely filed or
requests for extensions have been timely filed and granted and
have not expired for periods ending on or before December 31,
1992, and all returns filed are complete and accurate to the best
information and belief of their respective managements; all taxes
shown on filed returns have been paid. As of the date hereof,
there is no audit, examination, deficiency or refund litigation
or matter in controversy with respect to any taxes that might
result in a determination materially adverse to First State
except as reserved against in the First State Financial
Statements. All taxes, interest, additions and penalties due
with respect to completed and settled examinations or concluded
litigation have been paid, and First State's reserves for bad
debts at December 31, 1993, as filed with the Internal Revenue
Service were not greater than the maximum amounts permitted under
the provisions of Section 585 of the Internal Revenue Code of
1986, as amended (the "Internal Revenue Code").
7.15. Loans. To the best knowledge and belief of its
management, each loan reflected as an asset of First State in the
First State Financial Statements, as of June 30, 1994, or
acquired since that date, is the legal, valid, and binding
obligation of the obligor named therein, enforceable in
accordance with its terms, and no loan is subject to any asserted
defense, offset or counterclaim known to First State, except as
disclosed in writing to Hibernia on or prior to the date hereof.
7.16. Allowance for Loan Losses. The allowances for
possible loan losses shown on the balance sheets of First State
as of June 30, 1994 are adequate in all material respects under
the requirements of GAAP to provide for possible losses, net of
recoveries, relating to loans previously charged off, on loans
outstanding (including accrued interest receivable) as of June
30, 1994, and each such allowance has been established in
accordance with GAAP.
7.17. Title to Assets; Adequate Insurance Coverage.
(a) As of June 30, 1994, First State had, and except
with respect to assets disposed of for adequate consideration in
the ordinary course of business since such date, now have, good
and merchantable title to all real property and good and
merchantable title to all other material properties and assets
reflected in the First State Financial Statements, free and clear
of all mortgages, liens, pledges, restrictions, security
interests, charges and encumbrances of any nature except for (i)
mortgages and encumbrances which secure indebtedness which is
properly reflected in the First State Financial Statements or
which secure deposits of public funds as required by law; (ii)
liens for taxes accrued by not yet payable; (iii) liens arising
as a matter of law in the ordinary course of business with
respect to obligations incurred after June 30, 1994, provided
that the obligations secured by such liens are not delinquent or
are being contested in good faith; (iv) such imperfections of
title and encumbrances, if any, as do not materially detract from
the value or materially interfere with the present use of any of
such properties or assets or the potential sale of any such owned
properties or assets; and (v) capital leases and leases, if any,
to third parties for fair and adequate consideration. First
State owns, or has valid leasehold interests in, all material
properties and assets, tangible or intangible, used in the
conduct of its business. Any real property and other material
assets held under lease by First State are held under valid,
subsisting and enforceable leases with such exceptions as are not
material and do not interfere with the use made or proposed to be
made by Hibernia in such lease of such property.
(b) With respect to each lease of any real property or
a material amount of personal property to which First State is a
party, except for financing leases in which First State is
lessor: (i) such lease is in full force and effect in accordance
with its terms; (ii) all rents and other monetary amounts that
have become due and payable thereunder have been paid; (ii) there
exists no default or event, occurrence, condition or act which
with the giving of notice, the lapse of time or the happening of
any further event, occurrence, condition or act would become a
default under such lease; and (iv) the Merger will not constitute
a default or a cause for termination or modification of such
lease.
(c) First State has no legal obligation, absolute or
contingent, to any other person to sell or otherwise dispose of
any substantial part of its assets or to sell or dispose of any
of its assets except in the ordinary course of business
consistent with past practices.
(d) To the knowledge and belief of its management, the
policies of fire, theft, liability and other insurance maintained
with respect to the assets or business of First State provide
adequate coverage against loss.
7.18. Employee Plans. To the best of First State's
knowledge and belief it and all "employee benefit plans," as
defined in Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), that cover one or
more employees employed by First State:
(i) is in compliance with all laws, regulations,
reporting and licensing requirements and orders applicable to its
business or to such plan or any of its employees (because of such
employee's activities on behalf of it), the breach or violation
of which could have a material and adverse effect on such
business; and
(ii) has received no notification from any agency
or department of federal, state or local government or the staff
thereof asserting that any such entity is not in compliance with
any of the statutes, regulations or ordinances that such
governmental authority enforces, or threatening to revoke any
license, franchise, permit or governmental authorization, and is
subject to no agreement with any such governmental authority with
respect to its assets or business.
7.19. Copies of Employee Plans. Within ten days after
the date hereof, First State will provide to Hibernia true,
complete and accurate copies of all pension, retirement, stock
purchase, stock bonus, stock ownership, stock option, savings,
stock appreciation right or profit-sharing plans, any employment,
deferred compensation, consultant, severance, bonus, or
collective bargaining agreement or group insurance contract, or
any other incentive, welfare, or employee benefit plan or
agreement maintained by it for its employees or former employees.
7.20. Plan Liability. Except for liabilities to the
Pension Benefit Guaranty Corporation pursuant to Section 4007 of
ERISA, all of which have been fully paid, and except for
liabilities to the Internal Revenue Service under section 4971 of
the Internal Revenue Code, all of which have been fully paid,
First State has no liability to the Pension Benefit Guaranty
Corporation or to the Internal Revenue Service with respect to
any pension plan qualified under Section 401 of the Internal
Revenue Code.
7.21. No Default. First State is not in default in
any material respect under any contract, agreement, commitment,
arrangement, lease, insurance policy or other instrument to which
it is a party or by which its respective assets, business or
operations may be bound or affected or under which it or its
respective assets, business or operations receive benefits, 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.
7.22. Minutes. Prior to the date hereof, First State
has made available to Hibernia, for inspection pursuant to the
terms of Section 9.5 hereof, the minutes of meetings of First
State's Board of Directors and all committees thereof held prior
to the date hereof, which minutes are complete and correct in all
respects and fully and fairly present the deliberations and
actions of such Board and committees and accurately reflect the
business condition and operations of First State as of the dates
and for the periods indicated therein.
7.23. Insurance Policies. Attached hereto as Schedule
7.23 is a schedule detailing all policies of fire, theft, public
liability, and other insurance (including without limitation
fidelity bonds and directors and officers liability insurance)
maintained by First State at the date hereof. Except as
disclosed on Schedule 7.23 hereto, First State has not received
any notice of a premium increase or cancellation with respect to
any of its insurance policies or bonds, and within the last three
years, First State has not been refused any insurance coverage
sought or applied for, and it has no reason to believe that
existing insurance coverage cannot be renewed as and when the
same shall expire, upon terms and conditions as favorable as
those presently in effect, other than possible increases in
premiums or unavailability of coverage that do not result from
any extraordinary loss experience of First State.
7.24. Investments. Except for pledges to secure
public or trust deposits, none of the investments reflected in
the First State Financial Statements under the heading
"Investment Securities," and none of the investments made by
First State since June 30, 1994, and none of the assets reflected
in the First State Financial Statements under the heading "Cash
and Due From Banks," is subject to any restriction, whether
contractual or statutory, that materially impairs the ability of
First State freely to dispose of such investment at any time.
With respect to all repurchase agreements to which First State is
a party, First State has a valid, perfected first lien or
security interest in the government securities or other
collateral securing each such repurchase agreement which equals
or exceeds the amount of the debt secured by such collateral
under such agreement.
7.25. Environmental Matters. Neither First State nor,
to the knowledge of First State, any previous owner or operator
of any properties at any time owned (including any properties
owned as a result of foreclosure of a loan, whether still owned
or subsequently resold) leased, or occupied by First State or
used by First State in its business ("First State Properties")
used, generated, treated, stored, or disposed of any hazardous
waste, toxic substance, or similar materials on, under, or about
First State Properties except in compliance with all applicable
federal, state, and local laws, rules, and regulations pertaining
to air and water quality, hazardous waste, waste disposal, air
emissions, and other environmental matters ("Environmental
Laws"). First State has not received any notice of noncompliance
with Environmental Laws, applicable laws, orders, or regulations
of any governmental authorities relating to waste generated by
any such party or otherwise or notice that any such party is
liable or responsible for the remediation, removal, or clean-up
of any site relating to First State Properties.
8. Representations and Warranties of Hibernia. Hibernia
(and not its directors or officers in their personal capacities)
hereby represents and warrants as follows:
8.1. Recitals. The facts set forth in the preamble to
this Agreement with respect to it are true and correct.
8.2. Organization and Qualification. Hibernia is a
corporation, and HNB is a national banking association, duly
organized, validly existing and in good standing under the laws
of the State of Louisiana and the United States of America,
respectively. Each of Hibernia and HNB has the corporate power
and authority to carry on its business as it is now being
conducted and to own, lease and operate its assets, properties
and business, and Hibernia has all requisite power and authority
to execute and deliver this Agreement and perform its obligations
hereunder.
8.3. Shares Fully Paid and Non Assessable. The
outstanding shares of capital stock of Hibernia Corporation and
HNB are validly issued and outstanding, fully paid and
nonassessable (subject, in the case of HNB, to 12 U.S.C. Section
55) and all of such shares of HNB are owned directly or
indirectly by Hibernia free and clear of all liens, claims, and
encumbrances. The shares of Hibernia Common Stock to be issued
in connection with the Merger pursuant to this Agreement will
have been duly authorized and, when issued in accordance with the
terms of this Agreement, will be validly issued, fully paid, and
nonassessable.
8.4. Due Authorization. The execution, delivery and
performance of this Agreement have been authorized by Hibernia's
Board of Directors, and, subject to the regulatory and other
approvals required by Section 12 hereof, all corporate acts and
other proceedings required for the due and valid authorization,
execution, delivery and performance by Hibernia of this Agreement
and the consummation of the Merger have been validly and
appropriately taken. Subject to receipt of the regulatory and
other approvals required by Section 12 hereof, this Agreement is
a legal, valid, and binding obligation of Hibernia enforceable
against Hibernia in accordance with its terms, except that
enforcement may be limited by bankruptcy, insolvency, and other
laws of general applicability relating to or affecting creditors'
rights generally and by general equitable principles or
principles of Louisiana law that are similar to equitable
principles in jurisdictions that recognize a distinction between
law and equity.
8.5. No Conflicts. Except as disclosed on Schedule
8.5 hereto, the execution and delivery of this Agreement by
Hibernia does not, and the consummation of the transactions
contemplated hereby by it will not, constitute (i) 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 Hibernia or HNB or by
which Hibernia or any of HNB is subject, which breach, violation
or default would have a material and adverse effect on the
financial condition, properties, businesses, or results of
operations of Hibernia and HNB taken as a whole or on the
transactions contemplated hereby, (ii) to the best of the
knowledge of Hibernia's management, 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 Hibernia or HNB or to which Hibernia
or HNB is subject, or (iii) a breach or violation of, or a
default under the Articles of Incorporation or Association or
Bylaws of Hibernia, or of HNB, and the consummation of the
transactions contemplated hereby will not 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 required approvals of shareholders and
applicable regulatory authorities.
8.6. Reports of Hibernia. As of their respective
dates, none of its Annual Report on Form 10-K for the fiscal year
ended December 31, 1993, its Quarterly Reports on Form 10-Q for
the periods ended June 30, 1994, and its proxy statement for its
1994 annual meeting of shareholders, each in the form (including
exhibits) filed with the Securities and Exchange Commission (the
"SEC") and its quarterly report to shareholders for the period
ended June 30, 1994 (collectively, the "Hibernia Reports"),
contained any untrue statement of a material fact or omitted 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. There
is no fact or circumstance that, individually or in the
aggregate, materially and adversely has affected or is so
affecting, or, in the opinion of the executive officers of
Hibernia, may reasonably be expected in the future to so affect,
the business, financial condition, net worth, properties,
prospects or results of operations of Hibernia and HNB, taken as
a whole, that has not been disclosed in the Hibernia Reports.
Each of the balance sheets in or incorporated by reference into
the Hibernia Reports (including the related notes) fairly
presents the financial position of the entity or entities to
which it relates as of its date and each of the statements of
income and stockholders' equity and statement of cash flows or
equivalent statements in the Hibernia Reports (including any
related notes and schedules) fairly presents the results of
operations and changes in stockholders' equity, as the case may
be, of the entity or entities to which it relates for the periods
set forth therein (subject, in the case of unaudited statements,
to year-end audit adjustments that will not be material in amount
or effect), in each case in accordance with GAAP consistently
applied during the periods involved, except as may be noted
therein. Copies of the Hibernia Reports have been furnished to
First State on or before the date hereof.
8.7. No Material Adverse Change. Since June 30, 1994,
there has been no event or condition of any character (whether
actual, or to the knowledge of Hibernia or HNB, threatened or
contemplated) that has had or can reasonably be anticipated to
have, or that, if concluded or sustained adversely to Hibernia,
would reasonably be anticipated to have, a material adverse
effect on the financial condition, results of operations,
business or prospects of Hibernia or HNB, excluding changes in
laws or regulations that affecting banking institutions
generally.
8.8. Litigation and Proceedings. Except as set forth
on Schedule 8.8 hereto, no litigation proceeding or controversy
before any court or governmental agency is pending against
Hibernia or HNB that, in the opinion of management of Hibernia or
HNB, is likely to have a material and adverse effect on the
business, results of operations or financial condition of First
State taken as a whole, and, to the best of its knowledge, no
such litigation, proceeding or controversy has been threatened or
is contemplated.
9. Agreements and Covenants. Hibernia, HNB and First
State each hereby agrees and covenants to the other that:
9.1. Shareholder Approvals. If required by applicable
law, this Agreement shall be submitted to its respective
shareholders at a special meeting called and held in accordance
with applicable provisions of law (to be scheduled to the extent
possible for the date of the shareholders' meeting for the other
party hereto, if any) at which its shareholders shall be asked to
consider and vote upon this Agreement and the transactions
contemplated hereby.
9.2. Actions Necessary to Complete Merger. It shall
use its best efforts in good faith to take or cause to be taken
all action necessary or desirable under this Agreement on its
part as promptly as practicable so as to permit the consummation
of this Agreement at the earliest possible date (including
obtaining the consent or approval of each governmental authority
and individual, partnership, corporation, association, or any
other form of business or professional entity whose consent or
approval is required for the consummation of the transactions
contemplated hereby, requesting the delivery of appropriate
opinions and letters from its counsel and recommending that this
Agreement be approved by its shareholders) and cooperate fully
with the other party hereto to that end; provided, however, that
neither party shall be obligated to take or cause to be taken any
action which is or creates a material burden on such party,
except to the extent such actions are reasonably anticipated to
be required in order to effect the Merger.
9.3. Preparation of Registration Statement and Proxy
Statement. It shall prepare as promptly as practicable jointly
with the other party hereto a proxy statement to be mailed to the
shareholders of each party the shareholders of which are to vote
upon this Agreement in connection with the transactions
contemplated hereby and to be part of a registration statement
(the "Registration Statement") to be filed by Hibernia with the
SEC pursuant to the Securities Act of 1933, as amended (the "1933
Act") with respect to the shares to be issued in the Merger.
When the Registration Statement or any post-effective amendment
thereto shall become effective, and at all times subsequent to
such effectiveness, up to and including the time of the last
shareholder meeting with respect to the transactions contemplated
hereby, such Registration Statement and all amendments or
supplements thereto, with respect to all information set forth
therein furnished or to be furnished by Hibernia relating to
Hibernia and by First State relating to First State, (i) will
comply in all material respects with the provisions of the 1933
Act and the rules and regulations of the SEC thereunder 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. Hibernia will advise First State promptly after it
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, of the suspension
of the qualification of the Hibernia Common Stock issuable in
connection with the Merger 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.
9.4. Press Releases and Public Statements. Unless
approved by Hibernia in advance, First State will not issue any
press release, marketing or advertising material or other written
statement for general circulation relating to the transactions
contemplated hereby, except as otherwise required by law. The
parties will cooperate in any public announcements directly
related to the Merger; provided, however, that, in the event
Hibernia determines to file a current report on Form 8-K that
discloses only the substantive facts of a previously released
press release, such filing may be made without prior consultation
with First State so long as First State is furnished with a copy
of such report within a reasonable time after its filing.
9.5. Material Developments; Access to Information.
(i) In order to afford First State access to such
information as it may reasonably deem necessary to perform its
due diligence review with respect to Hibernia and HNB and its
assets in connection with the Merger, Hibernia shall (and shall
cause HNB to), (A) upon reasonable notice, afford First State and
its officers, employees, counsel, accountants and other
authorized representatives, during normal business hours
throughout the period prior to the Effective Date and to the
extent consistent with applicable law, access to its premises,
properties, books and records, and to furnish First State and
such representatives with such financial and operating data and
other information of any kind respecting its business and
properties as First State shall from time to time reasonably
request to perform such review, (B) furnish First State with
copies of all reports filed by Hibernia with the Securities and
Exchange Commission ("SEC") throughout the period after the date
hereof prior to the Effective Date promptly after such reports
are so filed, and (C) promptly advise First State of the
occurrence before the Effective Date of any event or condition of
any character (whether actual or to the knowledge of Hibernia,
threatened or contemplated) that has had or can reasonably be
anticipated to have, or that, if concluded or sustained adversely
to Hibernia, would reasonably be anticipated to have, a material
adverse effect on the financial condition, results of operations,
business or prospects of its consolidated group as a whole.
(ii) In order to afford Hibernia access to such
information as it may reasonably deem necessary to perform any
due diligence review with respect to the assets of First State to
be acquired as a result of the Merger, First State shall (and
shall cause the Bank to), upon reasonable notice, afford Hibernia
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 Bank's properties, books, contracts, commitments, loan
files, litigation files, and records (including, but not limited
to, the minutes of the Boards of Directors of First State and the
Bank and all committees thereof), and it shall (and shall cause
the Bank to), upon reasonable notice and to the extent consistent
with applicable law, furnish promptly to Hibernia such
information as Hibernia may reasonably request to perform such
review.
(iii) No investigation pursuant to this Section
9.5 shall affect or be deemed to modify any representation or
warranty made by, or the conditions to the obligations to
consummate the Merger of, either party to this Agreement.
9.6. Prohibited Negotiations. Prior to the Effective
Date, First State shall not solicit or encourage inquiries or
proposals with respect to, furnish any 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 of a substantial equity interest in, First State or
any business combination with First State other than as
contemplated by this Agreement. First State shall instruct each
officer, director, agent, or affiliate of it to refrain from
doing any of the above, and First State will notify Hibernia
promptly if any such inquiries or proposals are received by, any
such information is requested from, or any such negotiations or
discussions are sought to be initiated with, First State;
provided, however, that nothing contained in this section shall
be deemed to prohibit any officer or director of First State from
taking any action that, in the opinion of counsel to First State,
a copy of which opinion shall be furnished to Hibernia upon its
request, is required by applicable law.
9.7. Affiliates. Prior to the Closing Date (as
defined in Section 14 hereof), First State shall deliver to
Hibernia a letter identifying all persons whom it believes to be
"affiliates" of First State for purposes of Rule 145(c) or Rule
144 (as applicable) under the 1933 Act ("Affiliates"). First
State shall use its best efforts to cause each person so
identified to deliver to Hibernia prior to the Effective Date a
written agreement in substantially the form of Exhibit 9.7 hereto
providing, among other things,that such person will not dispose
of Hibernia Common Stock received in the Merger except in
compliance with the 1933 Act and the rules and regulations
thereunder and except in accordance with Section 201.01 of the
SEC's Codification of Financial Reporting Policies; provided,
however, that First State shall have no such obligation to use
its best efforts to cause any such identified person to deliver
to Hibernia such agreement if such person may not lawfully
execute such agreement.
9.8. Adjustment for Changes in Outstanding Shares. In
the event that prior to the Effective Date the outstanding shares
of Hibernia Common Stock shall have been increased, decreased, or
changed into or exchanged for a different number or kind of
shares or securities by reorganization, recapitalization,
reclassification, stock dividend, stock split, or other like
changes in the Hibernia's capitalization, then an appropriate and
proportionate adjustment shall be made in the number and kind of
shares of Hibernia Common Stock to be thereafter delivered
pursuant to Section 3.1 hereof. It is expressly understood and
agreed, however, that any change in the outstanding shares of
Hibernia resulting from (i) the consummation of a merger of an
institution with and into Hibernia or HNB, whether or not such
merger was pending on the date hereof, (ii) the exercise of stock
options granted to employees or directors of Hibernia or HNB, or
(iii) the exercise of nay warrant or other right to receive
Hibernia Common Stock described in the recitals to this
Agreement, shall not result in the adjustment of the number of
shares of Hibernia Common Stock to be issued in the Merger
pursuant to this Section 9.8.
9.9. Accounting Treatment. It shall use its best
efforts to cause the Merger to qualify for pooling-of-interests
accounting treatment to the extent factors affecting such
treatment are within its control.
9.10. Adoption of Accounting Policies. As soon as
practicable after the satisfaction or waiver of all conditions to
the Closing set forth in Section 12 of this Agreement and in any
event prior to the Effective Date (unless this Agreement is
terminated pursuant to Section 13 hereof), First State shall take
any and all necessary or appropriate actions to adopt all
Hibernia accounting procedures and policies (including without
limitation those policies pertaining to charged-off and non-
accrual assets); provided, however, that no such action taken by
First State at the request of Hibernia or HNB pursuant to this
Section shall be deemed to be, or be deemed to cause, a breach of
any representation or warranty made by First State herein.
9.11. Indemnification of Directors and Officers of
First State.
(a) From and after the Effective Date of the Merger,
Hibernia agrees to indemnify and hold harmless each person who,
as of the date immediately prior to the Closing Date, served as
an officer or director of First State (an "Indemnified Person")
from and against all damages, liabilities, judgments and claims
(and related expenses including, but not limited to, attorney's
fees and amounts paid in settlement) based upon or arising from
his capacity as an officer or director of First State, to the
same extent as he would have been indemnified under the Articles
of Association and/or Bylaws of HNB, as such documents were in
effect on the date of this Agreement as if he were an officer or
director of HNB at all relevant times; provided, however, that
the indemnification provided by this Section shall not apply to
any claim against an Indemnified Person if such Indemnified
Person knew or should have known of the existence of the claim
and failed to make a good faith effort to require First State, as
the case may be, to notify its director and officer liability
insurance carrier of the existence of such claim prior to the
Closing Date.
(b) The rights granted to the Indemnified Persons
hereby shall be contractual rights inuring to the benefit of all
Indemnified Persons and shall survive this Agreement and any
merger, consolidation or reorganization of Hibernia or HNB.
(c) The rights to indemnification granted by this
subsection 9.11 are subject to the following limitations: (i)
the total aggregate indemnification to be provided by Hibernia
pursuant to subsection 9.11(a) shall not exceed, as to all of the
Indemnified Persons as a group, the sum of $8,000,000, and
Hibernia shall have no responsibility to any Indemnified person
for the manner in which such sum is allocated among that group
(but nothing in this subsection is intended to prohibit the
Indemnified Persons from seeking reallocation among themselves);
(ii) a director or officer who would otherwise be an Indemnified
Person under this subsection 9.11 shall not be entitled to the
benefits hereof unless such director or officer has executed a
Joinder Agreement (the "Joinder Agreement") in the form of
Exhibit 9.11 hereto; and (iii) amounts otherwise required to be
paid by Hibernia to an Indemnified Person pursuant to this
subsection 9.11 shall be reduced by any amounts that such
Indemnified Person recovers by virtue of the claim for which
other employees and officers indemnification is sought.
(d) Hibernia agrees that the $8,000,000
indemnification limit set forth in paragraph (c) of this Section
9.11 shall not apply to any damages, liabilities, judgments and
claims (and related expenses, including but not limited to
attorney's fees and amounts paid in settlement) insofar as they
arise out of or are based upon the matters for which
indemnification is provided in Section 11.2 hereof.
9.12 Covenant to Close. At such time as is deemed
appropriate by the parties hereto or as otherwise set forth in
this Agreement, and upon satisfaction or waiver of each of the
conditions to Closing of the Merger, the parties agree to take
such actions as are reasonably necessary or appropriate to effect
the Closing and the Merger.
10. Permits, Consents and Approvals. As promptly as
practicable after the date hereof:
(a) Hibernia shall submit an application to the
Comptroller of the Currency (the "Comptroller") for approval of
the transactions contemplated hereby in accordance with the
provisions of the Bank Merger Act;
(b) First State shall endeavor to have its Affiliates
execute a written agreement in substantially the form of Exhibit
9.7 hereto; provided, however, that First State shall have no
such obligation prior to the receipt by the Board of Directors of
First State of the Fairness Opinion; and
(c) First State shall endeavor to have each of the
directors of First State execute a Non-Competition Agreement in
substantially the form of Exhibit 10(d) hereto; provided,
however, that First State shall have no such obligation prior to
the receipt by the Board of Directors of First State of the
Fairness Opinion.
11. Confidentiality; Hold Harmless; Restriction on
Acquisitions.
11.1. Confidentiality. For a period of five years
after the date hereof, the parties hereto acknowledge that each
of them or their representatives or agents has engaged in, and
may continue to engage in, certain due diligence reviews and
examinations with respect to the other and that, in the course of
such reviews and examination, has received or may receive in the
future confidential or proprietary information. Hibernia and
First State agree, on behalf of themselves, their respective
officers, directors, employees, representatives and agents, that
they will not use any information obtained pursuant to due
diligence investigations for any purpose unrelated to the
consummation of the transactions contemplated by this Agreement,
and, if the Merger is not consummated, will hold all such
information and documents in confidence unless and until such
time as such information or documents otherwise become publicly
available or as it is advised by counsel that any such
information or document is required by law to be disclosed, in
which event the party required to make such disclosure shall
advise and consult with the other party reasonably in advance of
such disclosure regarding the information proposed to be
disclosed. In the event of the termination of this Agreement,
Hibernia and First State shall, promptly upon request by the
other party, either destroy or return any documents so obtained.
11.2. Hold Harmless. Hibernia will indemnify and hold
harmless First State, each of its directors and officers and each
person, if any who controls First State within the meaning of the
1933 Act against any losses, claims, damages or liabilities,
joint, several or solidary, to which they or any of them may
become subject, under the 1933 Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon an untrue statement or
alleged untrue statement of a material fact contained in the
Registration Statement, or in any amendment or supplement
thereto, or arising out of or based upon the omission or alleged
omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not
misleading, and will reimburse each such person for any legal or
other expenses reasonably incurred by such person in connection
with investigating or defending any such action or claim;
provided, however, that Hibernia shall not be liable in any such
case to the extent that any such loss, claim, damage or liability
(or action in respect thereof) arises out of or is based upon any
untrue statement or alleged untrue statement or omission or
alleged omission made in the Registration Statement or any such
amendment or supplement in reliance upon and in conformity with
information furnished to Hibernia by First State for use therein.
Promptly after receipt by an indemnified party hereunder of
notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against
Hibernia under this Section, notify Hibernia in writing of the
commencement thereof. In case any such action shall be brought
against any indemnified party and it shall notify Hibernia of the
commencement thereof, Hibernia shall be entitled to participate
therein, and to the extent that it shall wish, to assume the
defense thereof, with counsel satisfactory to such indemnified
party, and, after notice from Hibernia to such indemnified party
of its election to so assume the defense thereof, Hibernia shall
not be liable to such indemnified party under this Section 11.2
for any legal expenses of other counsel or any other expenses
subsequently incurred by such indemnified party.
12. Conditions. The consummation of the Merger is
conditioned upon:
12.1. Shareholder Approval; Dissenters. Approval of
this Agreement by the required vote of shareholders of First
State and exercise and perfection of dissenters' rights pursuant
to Section 12: 131 of the LBCL by holders of First State Common
Stock holding in the aggregate no more than 10% of the First
State Common Stock outstanding on the Closing Date.
12.2. OCC Approval. Procurement by Hibernia of the
approval of the Comptroller of the Merger and any and all other
transactions contemplated hereby.
12.3. Other Approvals. Procurement of all other
consents and approvals and satisfaction of all other requirements
prescribed by law that are necessary to the consummation of the
transactions contemplated by this Agreement.
12.4. No Restraining Action. No litigation or
proceeding initiated by any governmental authority shall be
pending before any court or agency that shall present a claim to
restrain, prohibit or invalidate the transactions contemplated
hereby and neither Hibernia nor First State shall be prohibited
by any order of any court or other governmental authority from
consummating the transactions provided for in this Agreement.
12.5. Opinion of Hibernia Counsel. First State and
its directors shall have received an opinion, dated the Closing
Date, of counsel for Hibernia, in form and substance satisfactory
to First State, as to such matters as First State may reasonably
request with respect to the transactions contemplated hereby.
12.6. Opinion of First State Counsel. Hibernia, its
directors and its officers who sign the Registration Statement
shall have received an opinion, dated the Closing Date, of
[name], for First State, in form and substance satisfactory to
Hibernia, which shall cover such matters as Hibernia may
reasonably request with respect to the transactions contemplated
hereby.
12.7. Representations, Warranties and Agreements of
First State. Each of the representations, warranties, and
agreements of First State contained herein in all material
respects shall be true on, or complied with by, the Closing Date
as if made on such date (or on the date when made in the case of
any representation or warranty which specifically relates to an
earlier date) and Hibernia shall have received a certificate
signed by the Chairman of the Board and the President of First
State, dated the Closing Date, to such effect; First State shall
have furnished to Hibernia such other certificates as Hibernia
shall reasonably request in connection with the Closing (as
defined in Section 14 hereof), evidencing compliance with the
terms hereof and its status, business and financial condition.
First State shall have furnished Hibernia with such further
documents or other materials as Hibernia shall have reasonably
requested in connection with the transactions contemplated
hereby.
12.8. Representations, Warranties and Agreements of
Hibernia. Each of the representations, warranties and agreements
of Hibernia contained herein in all material respects shall be
true on, or complied with by, the Closing Date as if made on such
date (or the date when made in the case of any representations or
warranty which specifically relates to an earlier date) and First
State shall have received a certificate signed by the Chief
Executive Officer and the Treasurer of Hibernia, dated the
Closing Date, to such effect; Hibernia shall have furnished to
First State such other certificates as First State shall
reasonably request in connection with the Closing, evidencing
compliance with the terms hereof and its status, business and
financial condition. Hibernia shall have furnished First State
with such further documents or other materials as First State
shall have reasonably requested in connection with the
transactions contemplated hereby.
12.9. 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 and First State
shall have received a certificate to such effect from the officer
of Hibernia designated as its agent for service on the cover page
of the Registration Statement (which certificate may be to the
knowledge of such officer).
12.10. Blue Sky. Hibernia shall have received all
state securities laws and "blue sky" permits and other
authorizations necessary to consummate the transactions
contemplated hereby.
12.11. Tax Opinion. Hibernia shall have engaged, and
received an opinion of, a nationally recognized public accounting
firm, which opinion shall be satisfactory in form and substance
to Hibernia and First State, to the effect that the Merger when
consummated in accordance with the terms hereof will constitute a
reorganization within the meaning of Section 368(a) of the
Internal Revenue Code, and that the exchange of First State
Common Stock to the extent exchanged for Hibernia Common Stock
will not give rise to gain or loss to the shareholders of First
State with respect to such exchange and that the Louisiana income
tax treatment to the shareholders of First State will be
substantially the same as the federal income tax treatment to the
shareholders of First State.
12.12. Listing on New York Stock Exchange. The shares
of Hibernia Common Stock issuable to the holders of First State
Common Stock in the Merger shall have been approved for listing
on the New York Stock Exchange, Inc. on or before the Closing
Date, subject to official notice of issuance.
12.13. Fairness Opinion. First State shall have
received a letter from Austin Associates, Inc. dated within five
days of the scheduled date of mailing of the Proxy Statement to
its shareholders, and updated to within five days of the Closing
Date to the effect that the terms of the Merger are fair to its
shareholders from a financial point of view.
12.14. Receipt and Sufficiency of Schedules. Hibernia
shall have received, within thirty days after the date hereof,
all of the schedules and exhibits required to be furnished by
First State to Hibernia under this Agreement, which Schedules and
Exhibits shall be complete and accurate and reasonably acceptable
to Hibernia and First State shall have received, within thirty
days after the date hereof, all the schedules and exhibited
required to be furnished by Hibernia to First State pursuant to
Section 8 of this Agreement, which Schedules and Exhibits shall
be complete and accurate and reasonably acceptable to First
State.
12.15. Assertion of Conditions. A failure to satisfy
any of the requirements set forth in Section 12.5, 12.8 or 12.12
shall only constitute conditions to consummation of the Merger if
asserted by First State and a failure to satisfy any of the
requirements set forth in Section 12.6, 12.7 or 12.14 shall only
constitute conditions to consummation of the Merger if asserted
by Hibernia.
13. Termination. This Agreement may be terminated prior
to the Closing Date, either before or after its approval by the
shareholders of the parties hereto, in any of the following
events:
13.1. Mutual Consent. By the mutual consent of the
parties hereto, if the Board of Directors of each party so
determines by vote of a majority of the members of its entire
Board.
13.2. Breach of Representation, Warranty or Covenant.
By either party hereto, in the event of a breach by the other
party (a) of any covenant or agreement contained herein or (b) of
any representation or warranty herein, if (i) the facts
constituting such breach reflect a material and adverse change in
the financial condition, results of operations, business, or
prospects taken as a whole, of the breaching party, which in
either case cannot be or is not cured within 60 days after
written notice of such breach is given to the party committing
such breach, or (ii) in the event of a breach of a warranty or
covenant, such breach results in a material increase in the cost
of the non-breaching party's performance of this Agreement.
13.3. Passage of Time; Inability to Satisfy
Conditions. By either party hereto, in the event that (i) the
Merger is not consummated by June 30, 1995, or (ii) any condition
to Closing cannot be satisfied by June 30, 1995 and will not be
waived by the party or parties entitled to waive it.
13.4. Failure to Obtain Regulatory Approval. By
either party hereto, at any time after the Comptroller has denied
any application for any approval or clearance required to be
obtained as a condition to the consummation of the Merger and the
time period for all appeals or requests for reconsideration
thereof has run.
13.5. Failure to Obtain Shareholder Approval. By
either party hereto, if the Merger is not approved by the
required vote of shareholders of First State.
13.6. Dissenters. By Hibernia, if holders of more
than 10 percent of the outstanding First State Common Stock
exercise statutory rights of dissent and appraisal pursuant to 12
U.S.C. Section 215a.
13.7. Material Adverse Change. By First State, if a
material adverse change as described in Section 8.7 of this
Agreement occurs, and by Hibernia, if a material adverse change
as described in Section 7.7 hereof occurs, after the date hereof
and prior to the Closing.
13.8. Use of Pooling-of-Interests Accounting
Treatment. By Hibernia, in the event it shall determine that
the facts and circumstances surrounding the Merger prohibit or
materially jeopardize the treatment of the Merger as a pooling-
of-interests for accounting purposes.
13.9. Fairness Opinion. By First State, if it shall
not have received a letter from Austin Associates, Inc. dated
within five days of the scheduled date of mailing of its proxy
statement to its shareholders to the effect that the terms of the
Merger are fair to its shareholders from a financial point of
view.
13.10. Execution of Employment Agreements. By First
State, if the employment agreements referenced in Section 6(c)
hereof shall not have been executed by HNB and the persons named
therein.
14. Closing and Effective Date. The closing of the Merger
(the "Closing") shall take place at the office of Hibernia at 313
Carondelet Street, New Orleans, Louisiana, at 11:00 a.m. local
time, or at such other place or time as shall be mutually
agreeable to the parties hereto, on the first business day
occurring after the last to occur of: (i) the date that falls 30
days after the date of the order of the Comptroller approving the
Merger of First State with and into HNB pursuant to the Bank
Merger Act; (ii) the date that falls 5 days after the date on
which the last meeting of shareholders called to approve this
Agreement is held; or such later date within 60 days of such date
as may be agreed upon between the parties hereto; or (iii) such
other date chosen by the parties (the date and time of the
Closing being referred to herein as the "Closing Date").
Immediately upon consummation of the Closing, or on such other
later date as the parties hereto may agree, the Merger Agreement
shall be certified, executed, acknowledged and delivered to the
Office of the Comptroller for filing pursuant to and in
accordance with the provisions of the Bank Merger Act. The
Merger shall become effective as of the date and time of issuance
by the Secretary of a certificate of merger relating to the
Merger (such date and time being referred to herein as the
"Effective Date").
15. Survival and Termination of Representations, Warranties
and Covenants.
15.1. Except as otherwise provided in this Section 15,
the representations, warranties and covenants contained in this
Agreement shall terminate as of the earlier of the Effective Date
or the termination of this Agreement. Upon termination of such
representations, warranties and covenants, such provisions shall
be of no further force or effect, and no party hereto shall have
any legal right to redress, whether for breach of contract or
otherwise, as a result of a breach of any such provision.
15.2. The provisions and agreements set forth in
Sections 3, 5, 9.12 and 11 and the last sentence of Section 8.3
hereof shall survive the Closing, if the Closing occurs, for the
benefit of the shareholders, directors and officers of First
State who are the intended beneficiaries of such provisions.
15.3. The provisions of Section 11 and liabilities for
a breach of the provisions of Sections 9.2 or 9.11 shall survive
the termination of this Agreement if this Agreement terminates
without the Closing or the Merger having occurred, in which event
liability for a breach of Section 9.2 or Section 9.11 shall
survive the termination of the Agreement for a period of 180 days
following the date on which the Agreement terminates.
Nevertheless, no party to this Agreement shall have a legal right
to redress or cause of action for a breach of Section 9.2 except
in those circumstances in which such breach directly resulted in
the termination of the Agreement.
15.4. In consideration of the mutual benefits and
agreements contained in this Agreement, each of the parties
hereto, on behalf of itself and its successors and assigns,
hereby irrevocably waives any right or cause of action which
otherwise would survive in the absence of this Section 15.
16. Amendment; Waivers. To the extent permitted under
applicable law, prior to the Closing Date any provision of this
Agreement may be amended or modified at any time, either before
or after its approval by the shareholders of the parties hereto,
(i) by an agreement in writing among the parties hereto approved
by their respective Boards of Directors and executed in the same
manner as this Agreement, and (ii) as provided in Section 12:112
of the LBCL. Except with respect to any required shareholder or
regulatory approval, each party hereto, by written instrument
signed by a duly authorized officer of such party, may at any
time (whether before or after approval of this Agreement by the
shareholders of Hibernia or First State) extend the time for the
performance of any of the obligations or other acts of the other
party hereto and may waive (i) any inaccuracies of the other
party in the representations or warranties contained in this
agreement or any document delivered pursuant hereto, (ii)
compliance with any of the covenants, undertakings, or agreements
of the other party, or satisfaction of any of the conditions
precedent to its obligations, contained herein or (iii) the
performance by the other party of any of its obligations set out
herein or therein; provided that no such waiver executed after
approval of this Agreement by the shareholders of Hibernia or
First State shall change the number of shares of Hibernia Common
Stock into which shares of First State Common Stock will be
converted by the Merger.
17. Execution in Counterparts. This Agreement may be
executed in counterparts, each of which shall be deemed to
constitute an original. Each such counterpart shall become
effective when one counterpart has been signed by each party
hereto.
18. Governing Law. This Agreement shall be governed by, and
interpreted in accordance with, the laws of the State of
Louisiana applicable to agreements made and entirely to be
performed within such State, except as federal law may be
applicable.
19. Expenses. Each party hereto will bear all expenses
incurred by it in connection with this Agreement and the
transactions contemplated hereby, including the fees, expenses
and disbursements of its counsel and auditors, provided that
printing expenses shall be borne by Hibernia.
20. No Assignment. Prior to the Effective Date, neither
party hereto may assign any of its rights or obligations under
this Agreement to any other person without the prior written
consent of the other bank holding company that is a party hereto,
including any transfer or assignment by operation of law.
21. Notices. All notices or other communications which are
required or permitted hereunder shall be in writing and
sufficient if delivered personally or sent by registered or
certified mail, postage prepaid, to the Chief Executive Officer
of each party hereto at the address of such party set forth in
the preamble to this Agreement and shall be deemed to have been
given as of the date so personally delivered or mailed. A copy
of all notices or other communications directed to Hibernia shall
be sent to:
HNB
313 Carondelet Street
New Orleans, Louisiana 70130
Attention: Corporate Law Division
and a copy of all notices or other communications directed to
First State shall be sent to:
First State Bank and Trust Company
346 Columbia Street
Bogalusa, Louisiana 70427-3967
22. Headings. The headings in this Agreement are inserted
for convenience of reference only and are not intended to be a
part of or to affect the meaning or interpretation of this
Agreement.
23. Entire Agreement. This Agreement and the Schedules and
Exhibits hereto supersede any and all oral or written agreements
and understandings heretofore made relating to the subject matter
hereof and contain the entire agreement of the parties relating
to the subject matter hereof. The terms and conditions of this
Agreement shall inure to the benefit of and be binding upon the
parties hereto, and their respective successors. Nothing in this
Agreement or in the Merger Agreement is intended to or shall be
construed to confer upon or to give any person other than the
parties hereto any rights, remedies, obligation or liabilities
under or by reason of this Agreement except as expressly provided
herein.
IN WITNESS WHEREOF, the parties hereto have caused this
instrument to be executed in counterparts by their duly
authorized officers and their corporate seals to be hereunto
affixed, all as of the day and year first above written.
Hibernia Corporation
s/STEPHEN A. HANSEL
Stephen A. Hansel
President and Chief Executive
Officer
Attest:
s/PATRICIA C. MERINGER
Patricia C. Meringer
Secretary
Hibernia National Bank
s/STEPHEN A. HANSEL
Stephen A. Hansel
President and Chief Executive
Officer
Attest:
s/PATRICIA C. MERINGER
Patricia C. Meringer
Secretary
First State Bank and Trust Company
s/CHARLES M. CASSIDY
Chairman of the Board
Attest:
s/ROBERT J. PUCKETT
Secretary
APPENDIX B
FORM OF OPINION OF AUSTIN ASSOCIATES, INC.
Page 1
Members of the Board
November 4, 1994
November 4, 1994
Board of Directors
First State Bank & Trust Company
346 Columbia Street
Bogalusa, Louisiana 70427
Dear Members of the Board:
You have requested our opinion as to the fairness, from a financial
point of view, to First State Bank & Trust Company ("First State")
and its shareholders of the terms of the Agreement and Plan of
Merger dated August 16, 1994 ("Agreement") between and among First
State, Hibernia Corporation ("Hibernia") and Hibernia National Bank
("HNB"). The terms of the Agreement provide for the merger of
First State with and into HNB, a wholly-owned subsidiary of
Hibernia (the "Merger"). Hibernia will be the surviving bank
holding company and the current banking offices of First State will
become branches of HNB.
The terms of the Agreement provide for each outstanding share of
First State common stock, other than those exercising dissenter's
rights, to be converted into 33.5 shares of Hibernia common stock,
subject to adjustment, as fully described in the Agreement. In
general, should the Average Market Price of Hibernia fall below
$7.75 per share, the conversion ratio will be increased to provide
a minimum value of $259.63 for each First State share, and should
the Average Market Price of Hibernia exceed $9.75 per share, the
conversion ratio will be decreased to provide a maximum value of
$326.63 for each First State share.
The Average Market Price on the closing date for the Merger is
defined as the average of the mean of the high and low prices of
one share of Hibernia common stock for the five business days
preceding the last trading day immediately prior to the closing
date as reported in The Wall Street Journal. Additional provisions
are included in the Agreement to protect First State shareholders
Page 2
Members of the Board
November 4, 1994
should the closing date extend beyond May 1995, or in the event
Hibernia enters into an agreement to merge with an unaffiliated
third party prior to the closing date and will not be the surviving
company. No fractional shares of Hibernia will be issued in
connection with the Merger, and in lieu thereof, Hibernia will pay
cash to First State shareholders for the value of any fractional
share on the basis of the Average Market Price.
In carrying out our engagement, we have reviewed and analyzed
material bearing upon the financial and operating condition of
First State and Hibernia, including but not limited to the
following: (i) the Proxy Statement-Prospectus; (ii) the financial
statements of First State and Hibernia for the period 1990 through
June 30, 1994; (iii) certain other publicly available information
on First State and Hibernia; (iv) publicly available information
regarding the performance of certain other companies whose business
activities were believed by Austin Associates to be generally
comparable to those of First State and Hibernia; (v) the financial
terms, to the extent publicly available, of certain comparable
transactions; and (vi) such other analysis and information as
Austin Associates deemed relevant.
In our review and analysis, we relied upon and assumed the accuracy
and completeness of the financial and other information provided to
us or publicly available, and have not attempted to verify the
same. We have made no independent verification as to the status
of individual loans made by First State or Hibernia, and have
instead relied upon representations and information concerning
loans of First State and Hibernia in the aggregate. In rendering
our opinion, we have assumed that the transaction will be a tax-
free reorganization with no material adverse tax consequences to
First State or Hibernia, or to First State shareholders receiving
Hibernia stock. In addition, we have assumed in the course of
obtaining the necessary regulatory approvals for the transaction,
no condition will be imposed that will have a material adverse
effect on the contemplated benefits of the transaction to First
State and its shareholders.
Based upon our analysis and subject to the qualifications described
herein, considering all circumstances known to us and based on
other matters we consider relevant, we believe that as of the date
of this letter, the terms of the Agreement are fair, from a
financial point of view, to First State and its shareholders.
Page 3
Member of the Board
November 4, 1994
For our services in rendering this opinion, First State will pay us
a fee and indemnify us against certain liabilities.
/s/ AUSTIN ASSOCIATES, INC.
Austin Associates, Inc.
APPENDIX C
SELECTED PROVISIONS OF FEDERAL LAW RELATING TO THE RIGHTS
OF DISSENTING SHAREHOLDERS
12 U.S.C. Section 215a
(b) Dissenting shareholders
If a merger shall be voted for at the called meetings by the
necessary majorities of the shareholders of each association or
State bank participating in the plan of merger, and thereafter the
merger shall be approved by the Comptroller, any shareholder of any
association or State bank to be merged into the receiving
association who has voted against such merger at the meeting of the
association or bank of which he is a stockholder, or has given
notice in writing at or prior to such meeting to the presiding
officer that he dissents from the plan of merger, shall be entitled
to receive the value of the shares so held by him when such merger
shall be approved by the Comptroller upon written request made to
the receiving association at any time before thirty days after the
date of consummation of the merger, accompanied by the surrender of
his stock certificates.
(c) Valuation of shares
The value of the shares of any dissenting shareholder shall be
ascertained, as of the effective date of the merger, by an
appraisal made by a committee of three persons, composed of (1) one
selected by the vote of the holders of the majority of the stock,
the owners of which are entitled to payment in cash; (2) one
selectged by the directors of the receiving association; and (3)
one selected by the two so selected. The valuation agreed upon by
any two of the the three appraisers shall govern. If the value so
fixed shall not be satisfactory to any dissenting shareholder who
has requested payment, that shareholder may, within five days after
being notified of the appraised value of his shares, appeal to the
Comptroller, who shall cause a reappraisal to be made which shall
be final and binding as to the value of the shares of the
appellant.
APPENDIX F
FORM OF OPINION OF ERNST & YOUNG LLP REGARDING CERTAIN TAX MATTERS
November 7, 1994
November 7, 1994
Hibernia Corporation
313 Carondelet
P.O. Box 61540
New Orleans, Louisiana 70161
First State Bank and Trust Company of Bogalusa
346 Columbia Street
Bogalusa, Louisiana 70427
Dear Sir or Madam:
This letter is in response to your request that we provide you with
our opinion concerning certain federal income tax consequences
which would arise from consummation of the proposed merger of First
State Bank and Trust Company of Bogalusa ("Bank") with and into
Hibernia National Bank ("HNB"), a wholly-owned subsidiary of
Hibernia Corporation ("Hibernia"). (Hereinafter, referred to as
the "Merger.")
In rendering this opinion, we have relied upon the facts,
summarized below, as they have been presented to us orally by the
management of Hibernia and verified, in the Statements of Facts and
Representations dated October X, 1994 provided by the respective
managements of Bank, Hibernia, and HNB; in the Agreement and Plan
of Merger made and entered into by and between Bank and Hibernia as
of August 16, 1994 (the "Plan of Merger"); and in the Registration
Statement (Form S-4), dated October X, 1994, filed with the
Securities and Exchange Commission as declared effective on ______
and containing the Proxy Statement - Prospectus of Bank and
Hibernia dated ______ ("Prospectus"). (These are sometimes
hereinafter referred to collectively as "Documents.")
You have represented to us that the facts contained in the
documents provide an accurate and complete description of the facts
and circumstances concerning the proposed Merger. We have made no
independent investigation of the factual matters and circumstances
and, therefore, have relied upon the facts and representations in
the Documents for purposes of this letter. Any changes to the
facts or Documents may affect the conclusions stated herein.
We understand that reference to Ernst & Young LLP and our opinion
is included in the Prospectus relating to the issuance of Hibernia
Common Stock in connection with the proposed Merger and the special
meetings of the Bank shareholders with respect thereto. We
consent to such reference in the Prospectus under the caption,
"Conditions to Consummation of the Merger." We also understand
that the form of this letter is included as an appendix to the Form
S-4 Registration Statement. We consent to such inclusion.
<PAGE>
STATEMENT OF FACTS
Bank is a state banking corporation organized under the laws of the
State of Louisiana, engaged principally in the banking business.
Bank has 100,000 authorized shares of common stock of which 100,000
were issued and outstanding and held by approximately _____
shareholders as of the date hereof (referred to as "Bank Common
Stock"). No such shares were held in Bank's treasury as of the
date hereof. There are no options, warrants, subordinated rights
or other rights to purchase Bank Common Stock outstanding on the
date hereof.
Hibernia is a bank holding company organized and existing under the
laws of the State of Louisiana with shares registered under the
Securities Act of 1933. The presently authorized capital stock of
Hibernia is 300,000,000 shares, consisting of 100,000,000 shares of
preferred stock, no par value, and 200,000,000 shares of Class A
voting common stock, no par value (the Class A voting common stock
being referred to hereinafter as "Hibernia Common Stock"). As of
June 30, 1994, no shares of Hibernia's preferred stock were
outstanding, 83,717,760 shares of Hibernia Common Stock were
outstanding, and no shares of Hibernia Common Stock were held in
Hibernia's treasury. There are no existing options, warrants,
calls or commitments of any kind obligating Hibernia to issue any
share of its capital stock or any other security of which it is or
will be the issuer, except that Hibernia has issued warrants to
purchase shares of Hibernia Common Stock pursuant to the terms of
the Senior Secured Restructuring Agreement dated as of May 27,
1992, of which warrants to purchase 660,845 shares of Hibernia
Common Stock were outstanding as of June 30, 1994. Additionally,
Hibernia has authorized or reserved 1,718,707 shares of Hibernia
Common Stock for issuance under its 1987 Stock Option Plan,
pursuant to which options covering 1,557,491 shares of Hibernia
Common Stock were outstanding as of June 30, 1994; 3,660,087 (as
adjusted) shares of Hibernia Common Stock for issuance under its
1992 Long-Term Incentive Plan, pursuant to which options covering
2,505,055 shares of Hibernia Common Stock were outstanding as of
June 30, 1994; 1,000,000 shares of Hibernia Common Stock for
issuance under its 1993 Director Stock Option Plan, pursuant to
which options covering 155,000 shares of Hibernia Common Stock are
outstanding as of June 30, 1994; and 574,147 shares of Hibernia
Common Stock are available for issuance pursuant to Hibernia's
Dividend Reinvestment and Stock Purchase Plan. Mergers that have
been consummated with Commercial Bancshares, Inc., Bastrop National
Bank, First Bancorp of Louisiana, Inc. and First Continental
Bancshares, Inc. will result in the issuance of an aggregate of
approximately 13,021,494 shares. Pending mergers with Pioneer
Bancshares Corporation and American Bank (Norco) will result in the
issuance of approximately 10,620,512 shares of Hibernia Common
Stock. Hibernia Common Stock is traded on the New York Stock
Exchange.
HNB is a nationally chartered commercial bank engaged principally
in the banking business. HNB is a wholly owned subsidiary of
Hibernia.
BUSINESS PURPOSE
The management of Hibernia has represented to us that Hibernia
desires to consummate the Merger in order to improve its presence
in the Louisiana market. As discussed in the Prospectus under the
caption, "Background of and Reasons for the Merger," the Bank Board
of Directors believes the customers, depositors, and communities
served by Bank will benefit from being part of a larger banking
entity as a result of the future growth, synergies and cost savings
expected to be realized from the Merger.
PROPOSED TRANSACTIONS
In accordance with the above-stated business purpose, the following
transactions have been proposed:
1. After all necessary regulatory and shareholder
approvals have been granted, there will be a merger (i.e., the
Merger) of Bank with and into HNB in accordance with the
provisions of Bank Merger Act, 12 U.S.C. Sections 1828 et.
seq. and 12 U.S.C. Section 215a ("Bank Merger Act").
2. In the Merger, HNB will acquire all of the assets
and assume all of the liabilities of Bank in exchange for
Hibernia Common Stock. As a result of the Merger, each share
of the issued and outstanding Bank Common Stock shall be
converted into and become the number of shares of Hibernia
Common Stock determined in accordance with the exchange rate.
The exchange rate shall be the number that is obtained by
dividing 3,350,000 by the total number of issued and
outstanding shares of Bank Common Stock on the closing date.
In the event the Average Market Price (defined below) is less
than $7.75 per share, the exchange rate shall be calculated as
follows: ($25,962,500 divided by the Average Market Price of
Hibernia Common Stock) divided by the number of issued and
outstanding shares of Bank Common Stock. In the event that
the Average Market Price of Hibernia Common Stock is greater
than $9.75 per share, the exchange rate shall be calculated as
follows: ($32,662,500 divided by the Average Market Price of
Hibernia Common Stock) divided by the number of issued and
outstanding shares of Bank Common Stock.
In the event the Merger is not consummated on or before the
last day of the month that is nine months after the date of
the Plan of Merger, (the "Adjustment Period"), then for each
full month ending after the Adjustment Period, the number of
shares of Hibernia Common Stock to be exchanged shall be
calculated as follows: (3,350,000 plus the net, after-tax
earnings of Bank for each month ended after the Adjustment
Period) (the "Earnings Adjustment") divided by the Average
Market Price of Hibernia Common Stock. In the event the
Average Market Price (defined below) is less than $7.75 per
share, the adjustment described in the preceding sentence
shall be calculated on the basis of a total purchase price of
$25,962,500, plus the Earnings Adjustment, rather than a total
number of shares of Hibernia Common Stock to be exchanged.
Similarly, in the event that the Average Market Price of
Hibernia Common Stock is greater than $9.75 per share, the
foregoing adjustment shall be made on the basis of an
aggregate purchase price of $32,662,500, plus the Earnings
Adjustment, rather than a specified number of shares of
Hibernia Common Stock.
In the event that Hibernia executes, prior to the effective
date of the Merger, an agreement to merge with an unaffiliated
third party in a transaction in which Hibernia will not be the
surviving holding company, then the exchange rate shall be
calculated as set forth above, except that in the event the
Average Market Price of Hibernia Common Stock is greater than
$9.75 per share, the minimum number of shares to be issued in
the Merger, regardless of the Average Market Price of Hibernia
Common Stock, shall be 2,969,318.
The Average Market Price is defined as the average of the high
and low sales prices of one share of Hibernia Common Stock for
the five business days preceding the last trading day
immediately prior to the closing date as reported in the Wall
Street Journal. Holders of shares of Bank Common Stock
outstanding immediately prior to the effective date of the
Merger shall cease to be, and shall have no rights as,
shareholders of Bank after the Merger.
3. As a result of the Merger, each share of the issued
and outstanding Bank Common Stock shall cease to be
outstanding and will be canceled.
4. No fractional shares will be issued. Each holder of
Bank Common Stock who would otherwise have been entitled to
receive a fraction of a share of Hibernia Common Stock shall
receive in lieu thereof, cash (without interest) in an amount
equal to such fractional part of a share multiplied by the
Average Market Price of Hibernia Common Stock.
5. By following certain statutory procedures,
shareholders of Bank may exercise dissenter's rights entitling
them to receive in cash the value of their respective Bank
Common Stock in lieu of receiving Hibernia Common Stock in the
Merger.
REPRESENTATIONS
For purposes of our evaluation, we have received from the
management of Bank, Hibernia, and HNB, Statements of Facts and
Representations, dated October X, 1994, as set forth below.
References to the "Code" are to the Internal Revenue Code of 1986,
as amended.
The following representations have been made in connection with the
Merger:
(a) The fair market value of the Hibernia Common Stock
to be received by each Bank Common Stock
shareholder will be approximately equal to the fair
market value of the Bank Common stock surrendered
in the exchange.
(b) There is no plan or intention by the shareholders
of Bank who own five percent or more of the Bank
Common Stock and to the best knowledge of
management of Bank, there is no intention on the
part of the remaining shareholders of Bank, to
sell, exchange, or otherwise dispose of a number of
shares of Hibernia Common Stock received in the
transaction that would reduce the Bank
shareholders' ownership of Hibernia Common Stock to
a number of shares having a value, as of the date
of the transaction, of less than 50 percent of the
value of all the formerly outstanding Common Stock
of Bank as of the same date. For purposes of this
representation, any shares of Bank Common Stock
surrendered by dissenters, or exchanged for cash in
lieu of fractional shares of Hibernia Common Stock,
will be treated as outstanding Bank Common Stock on
the date of the transaction. Moreover, shares of
Bank Common Stock and shares of Hibernia Common
Stock held by former Bank shareholders and
otherwise sold, redeemed, or disposed of prior
August 16, 1994 or subsequent to the transaction
will be considered in making this representation.
(c) The payment of cash in lieu of fractional shares of
Hibernia Common Stock is solely for the purpose of
avoiding the expense and inconvenience to Hibernia
of issuing fractional shares and does not represent
separately bargained for consideration. The total
cash consideration that will be paid in the
transaction to the Bank shareholders instead of
issuing fractional shares of Hibernia will not
exceed one percent of the total consideration that
will be issued in the transaction to the Bank
shareholders in exchange for their shares of Bank
Common Stock. The fractional share interests of
each Bank shareholder will be aggregated, and no
Bank shareholder will receive cash in an amount
equal to or greater than the value of one full
share of Hibernia Common Stock.
(d) HNB will acquire at least 90 percent of the fair
market value of the net assets and at least 70
percent of the fair market value of the gross
assets held by Bank immediately prior to the
Merger. For purposes of this representation,
amounts paid by Bank to dissenters, Bank assets
used to pay its reorganization expenses, and all
redemptions and distributions (except for regular,
normal dividends) made by Bank immediately
preceding the transfer, will be included as assets
of Bank held immediately prior to the transaction.
(e) Prior to the transaction, Hibernia will be in
control of HNB within the meaning of Section 368(c)
of the Code wherein "control" is defined to mean
the ownership of stock possessing at least 80
percent of the total combined voting power of all
classes of stock entitled to vote and at least 80
percent of the total number of shares of all other
classes of the corporation.
(f) Following the transaction, HNB will not issue
additional shares of its Common Stock that would
result in Hibernia losing control of HNB within the
meaning of Section 368(c) of the Code.
(g) Hibernia has no plan or intention to reacquire any
of its Common Stock issued in the Merger other than
to acquire a nominal amount of shares of Common
Stock that may be acquired in ordinary business
transactions (including, but not limited to, open
market purchases in brokers' transactions).
(h) Hibernia has no plan or intention to liquidate HNB;
to merge HNB into another corporation; to sell or
otherwise dispose of the Common Stock of HNB; or to
cause HNB to sell or otherwise dispose of any of
the assets of Bank acquired in the transaction,
except for dispositions made in the ordinary course
of business. As Hibernia makes other acquisitions,
it is likely that some or all of the acquired banks
will be merged with and into HNB. At this time,
the discussion provided under the caption "Parties
to the Merger" in the Prospectus provides a
complete list of all pending acquisitions that are
covered by definitive agreements. However, no
Common Stock of HNB will be issued as consideration
in any of the pending acquisitions.
(i) Following the transaction, Hibernia will continue,
substantially unchanged, the banking business of
Bank, which will be merged with and into HNB.
(j) The liabilities of Bank assumed by HNB and the
liabilities to which the transferred assets of Bank
are subject were incurred by Bank in the ordinary
course of its business.
(k) Following the transaction, HNB will continue the
historic business of Bank or will use a significant
portion of Bank's historic business assets in its
business.
(l) Except for expenses relating to the registration of
the Hibernia Common Stock and certain proxy
printing and mailing expenses to be paid solely by
Hibernia, which are directly related to the Mergers
in accordance with the guidelines established in
Revenue Ruling 73-54, 1973-1 C.B. 187, Hibernia,
Bank, and the shareholders of Bank will pay their
respective expenses, if any, incurred in connection
with the transaction.
(m) There is no intercorporate indebtedness existing
between Bank and its affiliates on the one hand and
Hibernia and its affiliates on the other hand which
was issued, acquired, or will be settled at a
discount.
(n) No two parties to the transaction are investment
companies as defined in Section 368(a)(2)(F)(iii)
and (iv) of the Code.
(o) Bank is not under the jurisdiction of a court in a
Title 11 or similar case within the meaning of
Section 368(a)(3)(A) of the Code.
(p) The basis and fair market value of the assets of
Bank to be transferred to HNB will equal or exceed
the sum of the liabilities assumed by HNB, plus the
amount of liabilities, if any, to which the
transferred assets are subject.
(q) No HNB common stock will be issued or exchanged in
the Merger.
(r) None of the compensation received by any
shareholder-employees of Bank will be separate
consideration for, or allocable to, any of their
shares of Bank Common Stock; none of the shares of
Hibernia Common Stock received by any shareholder-
employees will be separate consideration for, or
allocable to, any employment agreement; and the
compensation paid to any shareholder-employees will
be for services actually rendered and will be
commensurate with amounts paid to third parties
bargaining at arm's-length for similar services.
(s) The shareholders of Bank (immediately before the
proposed transaction) receiving shares of Hibernia
Common Stock will not own (immediately after the
proposed transaction) more than fifty percent of
the fair market value of Hibernia Common Stock.
(t) The merger of Bank into HNB will qualify as a
statutory merger under the Bank Merger Act.
(u) There is no larger integrated transaction to which
the proposed transaction constitutes only one step.
TECHNICAL ANALYSIS
Section 368(a)(1)(A) of the Code provides that a reorganization (a
"Type A" reorganization) includes a statutory merger or
consolidation. Such a reorganization can only be achieved by
strict compliance with the applicable corporation laws of the
United States or a state or territory of the United States. A
statutory merger occurs wherein one party (the surviving
corporation) to the transaction absorbs the other party whose
corporate existence ceases. It has been represented by the
management of Hibernia that the merger of Bank with and into HNB,
wherein Hibernia Common Stock is to be exchanged for Bank Common
Stock, is to occur as a statutory merger under applicable law.
Section 368(a)(2)(D) of the Code provides that the acquisition by
one corporation in exchange for stock of a corporation which is in
control of the acquiring corporation, of substantially all of the
properties of another corporation, shall not disqualify a
transaction under Section 368(a)(1)(A) if (i) no stock of the
acquiring corporation is used in the transaction and (ii) the
transaction would have otherwise qualified as a Type A
reorganization had the merger been into the controlling
corporation. It has been represented by the management of Hibernia
and HNB that the merger of Bank with and into HNB, wherein Hibernia
Common Stock is to be exchanged for Bank Common Stock, is to occur
as a statutory merger under applicable law.
Revenue Procedure 77-37, 1977-2 C.B. 568 (Section 3.01) provides that, for
advance ruling purposes, the "substantially all" requirement of
Section 368(a)(2)(D) is satisfied if there is a transfer of assets
representing at least 90 percent of the fair market value of the
net assets and at least 70 percent of the fair market value of the
gross assets held by the transferor corporation immediately prior
to the transfer. Any payments to dissenters and any redemptions
and distributions (except for regular dividend distributions) made
by the corporation immediately preceding the transfer and which are
a part of the Agreement will be considered as assets held by the
corporation immediately prior to the transfer. Additionally, the
payment of expenses if any, by Bank, incurred in connection with
the Merger is taken into consideration in applying the
"substantially all" test.
In the proposed Merger, it has been represented by the management's
of Bank and HNB that HNB will acquire assets representing at least
90 percent of the fair market value of the net assets and 70
percent of the fair market value of the gross assets of Bank and
that, for this purpose, the fair market value of the net and gross
assets of Bank will be determined before payment by Bank of any
expenses incurred by it in connection with the Merger, before
payment to any dissenters to the Merger, and before any redemptions
and distributions (except for regular, normal dividends) made by
Bank immediately preceding the transfer. Based upon the foregoing
representations, the "substantially all" requirement will be met in
the Merger.
Additional Requirements
Sections 1.368-1(b) and 1.368-2(g) of the Income Tax Regulations
(the "Regulations") provide that the following additional
requirements must be met for a transaction to qualify as a
reorganization within the meaning of Section 368 of the Code:
(i) "continuity of interest" must be present,
(ii) "continuity of business enterprise" must exist, and
(iii) the transaction must be undertaken for reasons
pertaining to the continuance of the business of a
corporation which is a party to the transaction.
Continuity of Interest
In general, the continuity of interest test requires the owners of
the reorganized entity to receive and retain a meaningful equity in
the surviving entity. See e.g., Pinellas Ice & Cold Storage Co. v.
Comm'r, 287 U.S. 462 (1933); Cortland Specialty Company v. Comm'r,
60 F.2d 937 (2d Cir. 1932), cert. denied, 288 U.S. 599 (1932);
Helvering v. Minnesota Tea Co., 296 U.S. 378 (1935).
Revenue Procedure 77-37, 1977-2 C.B. 568 (Section 3.02) provides
that, for advance ruling purposes, the continuity of interest
requirement is satisfied if there is a continuing interest through
stock ownership in the acquiring or transferee corporation (or a
corporation in "control" thereof within the meaning of Section
368(c) of the Code) on the part of the former shareholders of the
acquired or transferor corporation which is equal in value as of
the effective date of the reorganization, to at least 50 percent of
the value of all of the formerly outstanding stock of the acquired
or transferor corporation as of that date. Sales, redemptions, and
other dispositions of stock occurring prior or subsequent to the
exchange which are part of the plan of reorganization will be
considered in determining whether there is a 50 percent continuing
interest through stock ownership as of the effective date of the
reorganization.
Based upon our understanding of the facts presented to us orally
and as set forth in the Statements of Facts and Representations
dated September X, 1994, the 50 percent continuity of interest
test of Revenue Procedure 77-37, supra, will be met in the Merger.
It has been represented by the management of Bank that the
shareholders of Bank have no plan or intention to sell, exchange or
otherwise dispose of a number of Hibernia Common Stock to be
received in the transaction that will reduce their Hibernia Common
Stock holdings to less than the requisite 50 percent continuity of
interest. Accordingly, in the Merger there will be a continuing
interest through Common Stock ownership in Hibernia on the part of
the former shareholders of Bank.
<PAGE>
Continuity of Business Enterprise
Section 1.368-1(b) of the Regulations also provides that a
continuity of business enterprise (as described in Section 1.368-
1(d) of the Regulations) is a requisite to a reorganization.
Section 1.368-1(d) of the Regulations provides that continuity of
business enterprise requires that the acquiring corporation either
continue the acquired corporation's historic business or use a
significant portion of the acquired corporation's historic assets
in a business. The proposed Merger will meet the continuity of
business enterprise test of Section 1.368-1(d) because, based upon
the representation of the management of HNB, HNB will continue the
historic business of Bank or will use a significant portion of
Bank's historic assets in a business.
Business Purpose
Section 1.368-2(g) of the Regulations provides that a
reorganization must be undertaken for reasons germane to the
continuance of the business of a corporation which is a party to
the reorganization. As heretofore indicated in the Business
Purpose Section set forth above, there are substantial business
reasons for the Merger. Accordingly, the Merger satisfies the
business purpose requirement as set forth in the Regulations.
Other Statutory Provisions
Section 368(b) of the Code defines the term "a party to a
reorganization" to include a corporation resulting from a
reorganization, and both corporations, in the case of a
reorganization resulting from the acquisition by one corporation of
stock or properties of another.
Section 361(a) of the Code provides that no gain or loss shall be
recognized to a transferor corporation which is a party to a
reorganization on any exchange pursuant to the plan of
reorganization solely for stock or securities in another
corporation which is a party to the reorganization.
Section 1032 of the Code provides that no gain or loss shall be
recognized to a corporation on the receipt of money or other
property in exchange for stock of such corporation. Revenue Ruling
57-278, 1957-1 C.B. 124, provides that a subsidiary will not
recognize gain upon the exchange of its parent's stock for property
in connection with a tax-free reorganization.
Section 354(a)(1) of the Code provides that no gain or loss shall
be recognized if stock or securities in a corporation which is a
party to a reorganization are, in pursuance of the plan of
reorganization, exchanged solely for stock or securities in such
corporation or in another corporation which is a party to the
reorganization.
Section 362(b) of the Code generally provides that if property is
acquired by a corporation in connection with the reorganization,
then the basis shall be the same as it would be in the hands of the
transferor, increased by the amount of gain recognized to the
transferor on such transfer.
Section 1223(2) of the Code provides that in determining a
taxpayer's holding period for property, there shall be included the
period for which such property was held by another person, if such
property has, for the purpose of determining gain or loss from a
sale or exchange, the same basis in whole or in part in such
taxpayer's hands as it would have had in the hands of such other
person.
Section 381 of the Code applies to certain transactions, including
those transactions to which Section 361 of the Code applies, where
there is a transfer in connection with a reorganization described
in Section 368(a)(1)(A) or in Section 368(a)(1)(A) and Section
368(a)(2)(D) of the Code.
FEDERAL INCOME TAX CONSEQUENCES
Based solely upon the Statements of Facts and Representations, the
Agreement, and the Plan of Merger, it is our opinion that the
following federal income tax consequences will result:
In the merger of Bank with and into HNB:
(1) Provided the proposed merger of Bank with and into HNB
qualifies as statutory merger under the Bank Merger Act,
the acquisition by HNB of substantially all of the assets
of Bank solely in exchange for Hibernia Common Stock,
cash for dissenters, if any, and the assumption by HNB of
the liabilities of Bank, will qualify as a reorganization
under the provisions of Sections 368(a)(1)(A) and
368(a)(2)(D) of the Code. Bank, Hibernia and HNB will
each be a party to a reorganization within the meaning of
Section 368(b) of the Code.
(2) No gain or loss will be recognized to Bank upon the transfer
of substantially all of its assets to HNB in exchange for
Hibernia Common Stock, cash for dissenters, if any, and
the assumption of Bank's liabilities by HNB, since any
cash for dissenters will be distributed to the Bank
shareholders (Sections 361 and 357(a) of the Code).
(3) No gain or loss will be recognized by either Hibernia or HNB
upon the acquisition by HNB of substantially all of the
assets of Bank in exchange for Hibernia Common Stock,
cash for dissenters, if any, and the assumption of Bank's
liabilities (Section 1032(a) of the Code). (Rev. Rul.
57-278, 1957-1 C.B. 124.)
(4) The basis of the assets of Bank acquired by HNB will be the
same in the hands of HNB as the basis of such assets in
the hands of Bank immediately prior to the exchange
(Section 362(b) of the Code).
(5) The basis of the HNB Common Stock in the hands of Hibernia
will be increased by an amount equal to the basis of the
Bank assets in the hands of HNB and decreased by the sum
of the amount of the liabilities of Bank assumed by HNB
and the amount of liabilities to which the assets of Bank
are subject (Section 1.358-6 of Proposed Regulations).
(6) The holding period of the assets of Bank received by HNB will,
in each instance, include the period for which such
assets were held by Bank (Section 1223(2) of the Code).
(7) No gain or loss will be recognized by the shareholders of Bank
upon the receipt of solely Hibernia Common Stock in
exchange for their shares of Bank Common Stock (Section
354(a)(1) of the Code).
(8) The basis of Hibernia Common Stock to be received by the
shareholders of Bank will be, in each instance, the same
as the basis of the Common Stock of Bank surrendered in
exchange therefor (Section 358(a)(1) of the Code).
(9) The holding period of the Hibernia Common Stock to be received
by the shareholders of Bank in the transaction will
include in each instance, the period during which the
Bank Common Stock surrendered in exchange therefor is
held as a capital asset on the date of the surrender
(Section 1223(l) of the Code).
(10) HNB will succeed to and take into account those tax attributes
of Bank described in Section 381(c) of the Code.
(Section 381(a) of the Code and Section 1.381(a)-1 of the
Regulations) These items will be taken into account by
HNB subject to the conditions and limitations specified
in Sections 381, 382, 383, and 384 of the Code and the
Regulations thereunder.
(11) As provided by Section 381(c) of the Code and Section
1.381(c)(2)-1 of the Regulations, HNB will succeed to and
take into account the earnings and profits, or deficit in
earnings and profits, of Bank as of the date of transfer.
Any deficit in the earnings and profits of Bank or HNB
will be used only to offset the earnings and profits
accumulated after the date of transfer.
(12) Cash received by a dissenting shareholder of Bank in exchange
for his or her Bank Common Stock will be treated as
having been received by such shareholder as a
distribution in redemption of his or her stock, subject
to the provisions and limitations of Section 302 of the
Code. If, as a result of such distribution, a
shareholder owns no stock either directly or through the
application of Section 318(a) of the Code, the redemption
will be a complete termination of interest within the
meaning of Section 302(b)(3) of the Code and such cash
will be treated as a distribution in full payment in
exchange for his or her stock, as provided by Section
302(a) of the Code.
(13) The payment of cash in lieu of fractional share interests of
Hibernia Common Stock will be treated as if the
fractional shares were distributed as part of the
exchange and then were redeemed by Hibernia. These cash
payments will be treated as distributions in full payment
in exchange for the stock redeemed, as provided in
Section 302(a) of the Code. (Rev. Rul. 66-365, 1966-2
C.B. 116 and Rev. Proc. 77-41, 1977-2 C.B. 574)
(14) Bank will close their taxable year as of the date of the
distribution or transfer. HNB will not close its taxable
year merely because of the Bank Merger. (Section 381(b)
of the Code.)
STATE INCOME TAX CONSEQUENCES
(1) The Louisiana income tax treatment to the shareholders of Bank
will be substantially the same as the federal income tax
treatment to the shareholders of Bank.
SCOPE OF OPINION
The scope of this opinion is expressly limited to the federal
income tax issues specifically addressed in (1) through (14) in the
section entitled "Federal Income Tax Consequences" above and (1) in
the section entitled "State Income Tax Consequences" above.
Specifically, our opinion has not been requested and none is
expressed with regard to the federal, foreign, state or local
income tax consequences for the shareholders of Hibernia and HNB.
We have made no determination nor expressed any opinion as to any
limitations, including those which may be imposed under Section
382, on the availability of net operating loss carryovers (or
built-in gains or losses), if any, after the Merger, the
application (if any) of the alternative minimum tax to this
transaction, nor the application of any consolidated return or
employee benefit issues which may arise as a result of the Merger.
We have made no determination nor expressed any opinion as to the
fair market value of any of the assets being transferred in the
Merger nor the common shares being exchanged in the Merger.
Furthermore, our opinion has not been requested and none is
expressed with respect to any foreign, state or local tax
consequences (other than those enumerated in (1) above of State
Income Tax Consequences) to Bank, Hibernia, and HNB.
Our opinion, as stated above, is based upon the analysis of the
Code, the Regulations thereunder, current case law, and published
rulings. The foregoing are subject to change, and such change may
be retroactively effective. If so, our views, as set forth above,
may be affected and may not be relied upon. Further, any variation
or differences in the facts or representations recited herein, for
any reason, might affect our conclusions, perhaps in an adverse
manner, and make them inapplicable. In addition, we have
undertaken no obligation to update this opinion for changes in
facts or law occurring subsequent to the date hereof.
This letter represents our views as to the interpretation of
existing law and, accordingly, no assurance can be given that the
Service or the courts will agree with the above analysis.
Very truly yours,
APPENDIX D
SELECTED PROVISIONS OF FEDERAL AND STATE LAW RELATING TO THE
RIGHTS OF DISSENTING SHAREHOLDERS
Federal Law (12 U.S.C. Section 215a)
(b) Dissenting shareholders
If a merger shall be voted for at the called meetings by the
necessary majorities of the shareholders of each association or
State bank participating in the plan of merger, and thereafter the
merger shall be approved by the Comptroller, any shareholder of any
association or State bank to be merged into the receiving
association who has voted against such merger at the meeting of the
association or bank of which he is a stockholder, or has given
notice in writing at or prior to such meeting to the presiding
officer that he dissents from the plan of merger, shall be entitled
to receive the value of the shares so held by him when such merger
shall be approved by the Comptroller . . ..
(d) State Appraisal and Merger Law
. . . The appraisal of such shares of stock in any State bank
shall be determined in the manner prescribed by the law of the
State in such cases, rather than as provided in this section, if
such provision is made in the State law; and no such merger shall
be in contravention of the law of the State under which such bank
is incorporated. The provisions of this subsection shall apply
only to shareholders of (and stock owned by them in) a bank or
association being merged into the receiving association.
State Law (La. R.S. 6:376)
A. If a state bank has, by vote of its stockholders, become
a party to a merger . . ., then, . . . a stockholder who voted
against such action shall have the right to dissent.
C. (1) Except as provided in the last sentence of this
Subsection, any stockholder electing to exercise such right of
dissent shall file with the bank, prior to or at the meeting of
stockholders at which such proposed action is submitted to a vote,
a written objection to such proposed action and shall vote his
shares against such action.
(2) If such proposed action be taken by the required
vote . . ., and the merger . . . authorized thereby be effected,
the bank shall promptly thereafter give written notice thereof, by
registered mail, to each stockholder who filed such written
objection to and voted his shares against such action at such
stockholder's last address on the bank's records.
(3) Each such stockholder may, within twenty days after
the mailing of such notice to him but not thereafter, file with the
bank a demand in writing for the fair cash value of his shares as
of the day before such vote was taken, provided that he state in
such demand the value demanded and a post office address to which
the reply of the bank may be sent and at the same time deposit in
escrow in a bank or trust company located in the parish of the
domicile of the bank the certificates representing his shares, duly
endorsed and transferred to the escrow bank upon the sole condition
that said certificates shall be delivered to the bank upon payment
of the value of the shares determined in accordance with the
provisions of this Section. With his demand, the stockholder shall
deliver to the bank the written acknowledgment of such escrow bank
or trust company with which such certificates have been deposited
that it so holds his certificates of stock.
(4) Unless the objection, demand, and acknowledgment
aforesaid be made and delivered by the stockholder within the
period described in this Subsection, he shall conclusively be
presumed to have acquiesced in the action proposed or taken.
D. If the bank does not agree to the value so stated and
demanded . . . it shall, within twenty days after the receipt of
such demand and acknowledgement, notify in writing the stockholder
at the designated post office address of its disagreement and shall
state in such notice the value it will agree to pay if any payment
should be held to be due; otherwise, it shall be liable for and
shall pay to the dissatisfied stockholder the value demanded by him
for his shares.
E. (1) In case of disagreement as to such fair cash value
or as to whether any payment is due after compliance by the parties
with the provisions of Subsections C and D of this Section, the
dissatisfied stockholder within sixty days after receipt of notice
in writing of the bank's disagreement but not thereafter may file
suit against the bank or the merged or consolidated bank, as the
case may be, in the district court of the parish in which the bank
or the merged or consolidated bank, as the case may be, is
domiciled praying the court to fix and decree the fair cash value
of the dissatisfied stockholder's shares as of the day before the
action complained of was taken, and the court shall, on such
evidence as may be adduced in relation thereto, determine summarily
whether any payment is due and, if so, such cash value, and render
judgment accordingly.
(2) Any stockholder entitled to file such a suit may,
within such sixty-day period but not thereafter, intervene as a
plaintiff in such a suit filed by another stockholder and recover
therein judgment against the bank for the fair cash value of his
shares. No order or decree shall be made by the court staying the
proposed action, and any such action may be carried to completion
notwithstanding any such suit.
(3) Failure of the stockholder to bring suit or to
intervene in such a suit within sixty days after receipt of notice
of disagreement by the bank shall conclusively bind the
stockholder:
(a) By the bank's statement that no payment is due;
or
(b) If the bank does not contend that no payment is
due, to accept the value of his shares as fixed by the bank in its
notice of disagreement.
F. When the fair value of the shares has been agreed upon
between the stockholder and the bank, or when the bank has become
liable for the value demanded by the stockholder because of failure
to give notice of disagreement and of the value it will pay, or
when the stockholder has become bound to accept the value the bank
agrees is due because of his failure to bring suit within sixty
days after receipt of notice of the bank's disagreement, the action
of the stockholder to recover such value must be brought within
five years from the date the value was agreed upon or the liability
of the bank became fixed.
G. If the bank or the merged or consolidated bank, as the
case may be, shall, in its notice of disagreement, have offered to
pay the dissatisfied stockholder on demand an amount in cash deemed
by it to be fair cash value of his shares, and if, on the
institution of a suit by the dissatisfied stockholder claiming an
amount in excess of the amount offered, the bank or the merged or
consolidated bank, as the case may be, shall deposit in the
registry of the court, there to remain until the final
determination of the cause, the amount so offered; then, if the
amount finally awarded such stockholder, exclusive of interest and
costs, be more than the amount offered and deposited as aforesaid,
the costs of the proceeding shall be taxed against the bank or the
merged or consolidated bank, as the case may be, and judicial
interest may be awarded against such bank only on the amount of the
award in excess of the amount deposited in the registry of the
court; otherwise, the costs of the proceeding shall be taxed
against such stockholder.
H. Upon filing a demand for the value of his shares, the
stockholder shall cease to have any of the rights of a stockholder
except the rights accorded by this Section. Such a demand may be
withdrawn by the stockholder lat any time before the bank gives
notice of disagreement as provided in Subsection D of this Section.
After such notice of disagreement is given, withdrawal of a notice
of election shall require the written consent of the bank. If a
notice of election is withdrawn, or the proposed corporate action
is abandoned or rescinded, or a court should determine that the
stockholder is not entitled to receive payment for his shares, or
the stockholder should otherwise lose his dissenter's rights:
(1) He shall not have the right to receive a payment for
his shares;
(2) His share certificates shall be returned to him and,
on his request, new certificates shall be issued to him in exchange
for the old ones endorsed to the bank; and
(3) He shall be reinstated to all his rights as a
stockholder as of the filing of his demand for value, including any
intervening preemptive rights and the right to payment of any
intervening dividend or other distribution, or, if any rights have
expired or any such dividend or distribution other than in cash has
been completed, in lieu thereof, at the election of the bank he
shall receive the fair value thereof in cash as determined by the
board as of the time of such expiration or completion, but without
prejudice otherwise to any proceeding that may have been taken in
the interim.<PAGE>
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
Item 20. Indemnification of Directors and Officers.
The Louisiana Business Corporation Law ("LBCL") contains two
provisions that directly affect the liability of officers and
directors of Louisiana corporations to the corporations and
shareholders whom they serve. Section 83 permits Louisiana
corporations to indemnify officers and directors, as well as
certain other individuals who act on behalf of such corporations.
Sections 91 and 92 set forth the liability of officers and
directors of Louisiana corporations.
Section 91 of the LBCL provides that officers and directors of
Louisiana corporations are fiduciaries with respect to the
corporation and its shareholders and requires that they discharge
the duties of their positions as such in good faith and with the
diligence, care, judgment and skill which ordinarily prudent men
would exercise under similar circumstances in like positions.
Section 91 specifically provides that it is not intended to
derogate from any indemnification permitted under Section 83,
discussed below.
Section 92 of the LBCL limits the liability of officers and
directors with respect to certain matters, as well as imposes
personal liability for certain actions, such as the knowing
issuance of shares in violation of the LBCL. Paragraph E of
Section 92 permits a director, in the performance of his duties, to
be fully protected from liability in relying in good faith on the
records of the corporation and upon such information, opinions,
reports or statements presented to the corporation, the board of
directors, or any committee of the board by any of the
corporation's officers or employees, or by any committee of the
board of directors, or by any counsel, appraiser, engineer or
independent or certified public accountant selected with reasonable
care by the board of directors or any committee thereof or any
officer having the authority to make such a selection or by any
other person as to matters the directors reasonably believe are
within such other person's professional or expert competence and
which person is selected with reasonable care by the board of
directors or any committee thereof or any officer having the
authority to make such selection.
Section 83 of the LBCL permits a Louisiana corporation to
indemnify any person who is or was a party or is threatened to be
made a party to any action, suit or proceeding by reason of the
fact that he or she was a director, officer, employee or agent of
the corporation, or was serving at the request of the corporation
in one of those capacities for another business. Such persons may
be indemnified against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and
reasonably incurred by such persons in connection with any such
action as long as the indemnified party acted in good faith and in
a manner he or she reasonably believed to be in, or not opposed to,
the best interests of the corporation. With respect to criminal
actions or proceedings, the indemnified person must not only have
acted in good faith and in a manner believed to be in or not
opposed to the best interest of the corporation; he or she must
also not have had any reasonable cause to believe that his or her
conduct was unlawful.
The LBCL treats suits by or in the right of the corporation,
or derivative suits, differently from other legal actions.
Indemnification is not permitted in a derivative action for any
expenses if the individual seeking indemnification is adjudged
liable for negligence or misconduct in the performance of his or
her duty to the corporation unless specifically ordered by the
court. Otherwise, officers and directors may be indemnified in
derivative actions only with respect to expenses (including
attorneys' fees) actually and reasonably incurred in connection
with the defense or settlement of the action.
Indemnification of officers and directors may only be made by
the corporation if the corporation has specifically authorized
indemnification after determining that the applicable standard of
conduct has been met. This determination may be made (i) by the
board of directors by a majority vote of a quorum consisting of
directors who were not parties to such action, suit or proceeding,
or (ii) if such a quorum is not obtainable or a quorum of
disinterested directors so directs, by independent legal counsel,
or (iii) by the shareholders.
Indemnification of officers and directors against reasonable
expenses is mandatory under Section 83 of the LBCL to the extent
the officer or director is successful on the merits or in the
defense of any action or suit against him giving rise to a claim of
indemnification.
Louisiana corporations are permitted to advance the costs of
defense to officers and directors with respect to claims for which
they may be indemnified under Section 83 of the LBCL. In order to
advance such costs, however, such procedure must be approved by the
board of directors by a majority of a quorum consisting of
disinterested directors. In addition, a corporation may only
advance defense costs if it has received an undertaking from the
officer or director to repay the amounts advanced unless it is
ultimately determined that he or she is entitled to be indemnified
as otherwise authorized by Section 83.
Louisiana corporations are also specifically permitted to
procure insurance on behalf of officers and directors and former
officers and directors for actions taken in their capacities as
such. Insurance coverage may be broader than the limits of
indemnification under Section 83. Also, the indemnification
provided for in Section 83 is not exclusive of any other rights to
indemnification, whether arising from contracts or otherwise.
The Company has adopted an indemnification provision to its
articles of incorporation that provides for indemnification of
officers and directors under the circumstances permitted by
Louisiana law. The Company's indemnification provision requires
indemnification, except as prohibited by law, of officers and
directors of the Company or any of its wholly-owned subsidiaries
against expenses, judgments, fines and amounts paid in settlement
actually and reasonably incurred in connection with any action,
suit or proceeding, whether civil or criminal, administrative or
investigative (including any action by or in the right of the
Company) by reason of the fact that the person served as an officer
or director of the Company or one of its subsidiaries. Officers
and directors may only be indemnified against expenses in cases
brought by the officer or director against the Company if the
action is a claim for indemnification, the officer or director
prevails in the action, or indemnification is included in any
settlement or is awarded by the court. The indemnification
provision further requires the Company to advance defense costs to
officers and directors in such suits and proceedings upon receipt
of an undertaking to repay such expenses unless it is ultimately
determined that the officer or director is entitled to
indemnification as authorized by the Article.
The Company's Articles of Incorporation further provide that
no director or officer of the Company shall be personally liable to
the Company or its shareholder for monetary damages for breach of
fiduciary duty as an officer or director. This provision is
limited to those circumstances in which such a limitation of
liability is permitted under applicable law and would not be
operative in any circumstances in which the law prohibits such an
limitation.
The Articles of Association of the HNB include indemnification
and limitation of liability provisions identical to those adopted
by the Company and described above.
Item 21. Exhibits and Financial Statement Schedules.
EXHIBIT DESCRIPTION
2 Agreement and Plan of Merger, included as Appendix
A to the Proxy Statement-Prospectus.
3.1 Exhibit 4.1 to the Registration Statement on Form
S-3 filed with the Commission by the Registrant
(Registration No. 33-23591) is hereby incorporated
by reference (Articles of Incorporation of the
Registrant, as amended to date).
3.2 Exhibit 4.2 to the Registration Statement on Form
S-8 filed with the Commission by the Registrant
(Post-Effective Amendment No. 2 to Registration No.
2-96194) is hereby incorporated by reference (By-
Laws of the Registrant, as amended to date).
4.1 Specimen Common Stock Certificate included as
Exhibit __ in the Registrant's Quarterly Report on
Form 10-Q for the quarter ended ___________ and
incorporated herein by reference.
4.2 Copies of instruments defining the rights of the
holder of long-term debt of the Registrant will be
furnished to the Commission upon request.
5 Opinion of Patricia C. Meringer, Esq. re: legality
of shares.
8 Opinion of Ernst & Young, certified public
accountants, regarding certain tax matters,
included as Appendix C to the Proxy Statement-
Prospectus.
10.13 Exhibit 10.13 to the Annual Report on Form 10-K for
the fiscal year ended December 31, 1988, filed with
the Commission by the Registrant (Commission File
No. 0-7220) is hereby incorporated by reference
(Deferred Compensation Plan for Outside Directors
of Hibernia Corporation and its Subsidiaries, as
amended to date).
10.14 Exhibit 10.14 to the Annual Report on Form 10-K for
the fiscal year ended December 31, 1990, filed with
the Commission by the Registrant (Commission File
No. 0-7220) is hereby incorporated by reference
(Hibernia Corporation Executive Life Insurance
Plan).
10.16 Exhibit 4.7 to the Registration Statement on Form
S-8 filed with the Commission by the Registrant
(Registration No. 33-26871) is hereby incorporated
by reference (Hibernia Corporation 1987 Stock
Option Plan, as amended to date).
10.28 Exhibits M and N to the Company's definitive proxy
statement dated August 17, 1992 relating to its
1992 Annual Meeting of Shareholders filed with the
Commission by the Registrant is hereby incorporated
by reference (Warrant Agreement dated as of May 27,
1992 among the Registrant, The Chase Manhattan
Bank (National Association) and certain other
lenders, including the Form of Warrant attached
thereto).
10.29 Exhibit L to the Registrant's definitive proxy
statement dated August 17, 1992 relating to its
1992 Annual Meeting of Shareholders filed with the
Commission by the Registrant is hereby incorporated
by reference (Registration Rights Agreement dated
as of May 27, 1992 among the Registrant, The Chase
Manhattan Bank (National Association) and certain
other lenders, as amended to date).
10.30 Exhibit 10.30 to a Current Report on Form 8-K dated
July 17, 1992 filed by the Registrant with the
Commission is hereby incorporated by reference
(Stock Purchase Agreement dated as of July 17, 1992
between the Registrant, Hibernia National Bank in
Texas and Comerica Incorporated).
10.31 Exhibit 10.31 to a Current Report on Form 8-K dated
September 15, 1992 filed by the Registrant with the
Commission is hereby incorporated by reference
(Amendment to Stock Purchase Agreement dated
September 10, 1992 between Registrant and Comerica
Incorporated).
10.34 Exhibit C to the Registrant's definitive proxy
statement dated August 17, 1992 relating to its
1992 Annual Meeting of Shareholders filed by the
Registrant with the Commission is hereby
incorporated by reference (Long-Term Incentive Plan
of Hibernia Corporation).
10.35 Exhibit A to the Registrant's definitive proxy
statement dated March 23, 1993 relating to its 1993
Annual Meeting of Shareholders filed by the
Registrant with the Commission is hereby
incorporated by reference (1993 Director Stock
Option Plan of Hibernia Corporation).
10.36 Exhibit 10.36 to the Registrant's Annual Report on
Form 10-K for the fiscal year ended December 31,
1993 filed with the Commission (Commission file no.
0-7220) is hereby incorporated by reference
(Employment agreement between Stephen A. Hansel and
Hibernia Corporation).
13 Exhibit 13 to the Registrant's Annual Report on
Form 10-K for the fiscal year ended December 31,
1993 filed with the Commission (Commission file No.
0-7220) is hereby incorporated by reference (1993
Annual Report to security holders of the
Registrant).
21 Exhibit 21 to the Annual Report on Form 10-K of the
Registrant for the fiscal year ended December 31,
1989 filed with the Commission (Commission file no.
0-7220) is hereby incorporated by reference
(Subsidiaries of the Registrant).
23.1 Consents of Patricia C. Meringer, Esq.,
included with Exhibit 5.
23.2 Consent of Ernst & Young LLP.
23.3 Consent of Arthur Andersen & Co. LLP.
23.4 Consent of KPMG Peat Marwick LLP.
23.5 Consent of Roger C. Parker.
23.6 Consent of Castaing, Hussey and Lolan.
23.7 Consent of H. J. Lowe & Company.
23.8 Consent of Austin Associates, Inc.
24 Powers of Attorney of directors of Hibernia
Corporation, contained on page S-1 of the
Registration Statement.
99.1 Supplemental Consolidated Financial Statements
of Hibernia Corporation (as restated to
reflect the acquisitions of Commercial
Bancshares, Inc., and Bastrop National Bank on
July 1, 1994 and the acquisitions of First
Bancorp of Louisiana, Inc. and First
Continental Bancshares, Inc. on August 1,
1994) (incorporated by reference to a Current
Report on Form 8-K dated October 7, 1994).
99.2 Audited Consolidated Financial Statements of
Commercial Bancshares, Inc. for the fiscal
year ended December 31, 1993 (incorporated by
reference to a Current Report on Form 8-K
dated October 7, 1994).
99.3 Audited Financial Statements of Bastrop
National Bank for the fiscal year ended
December 31, 1993 (incorporated by reference
to a Current Report on Form 8-K dated October
7, 1994).
99.4 Audited Consolidated Financial Statements of
First Bancorp of Louisiana, Inc. for the
fiscal year ended December 31, 1993
(incorporated by reference to a Current Report
on Form 8-K dated October 7, 1994).
99.5 Audited Consolidated Financial Statements of
First Continental Bancshares, Inc. for the
fiscal year ended December 31, 1993
(incorporated by reference to a Current Report
on Form 8-K dated October 7, 1994).
99.6 Form of Proxy of First State Bank and Trust
Company of Bogalusa.
Item 22. Undertakings.
The undersigned registrant hereby undertakes:
(1) To respond to requests for information that is
incorporated by reference into the prospectus pursuant to
Items 4, 10(b), 11 or 13 of this Form, within one business day
of receipt of such request and to send the incorporated
documents by first class mail or other equally prompt means.
This includes information contained in documents filed
subsequent to the effective date of the registration statement
through the date of responding to the request;
(2) To supply by means of a post-effective amendment all
information concerning a transaction, and the company being
acquired involved therein, that was not the subject of and
included in the registration statement when it became
effective;
(3) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of the registrant's annual
report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each
filing of an employee benefit plan's annual report pursuant to
section 15(d) of the Securities Exchange Act of 1934) that is
incorporated by reference in the registration statement shall
be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona
fide offering thereof;
(4) That prior to any public reoffering of the securities
registered hereunder through use of a prospectus which is a
part of this registration statement, by any person or party
who is deemed to be an underwriter within the meaning of Rule
145(c), the issuer undertakes that such reoffering prospectus
will contain the information called for by the applicable
registration form with respect to reofferings by persons who
may be deemed underwriters, in addition to information called
for by the other Items of the applicable form;
(5) That every prospectus (i) that is filed pursuant to the
preceding paragraph, or (ii) that purports to meet the
requirements of section 10(a)(3) of the Act and is used in
connection with an offering of securities subject to Rule 415,
will be filed as a part of an amendment to the registration
statement and will not be used until such amendment is
effective and that, for purposes of determining any liability
under the Securities Act of 1933, each such post-effective
amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering
of such securities at that time shall be deemed to be the
initial bona fide offering thereof; and
(6) Insofar as indemnification for liabilities arising under
the Securities Act of 1933 may be permitted to directors,
officers and controlling persons of the registrant pursuant to
the foregoing provisions, or otherwise, the registrant has
been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore,
uneforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer
or controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted by such
director, officer, or controlling person in connection with
the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriatee
jurisdiction the question whether such indemnification by it
is against public policy as expressed in the Act and will be
governed by the final adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the Registrant hereby certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form S-
4 and has duly caused this Registration Statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the
City of New Orleans, State of Louisiana, on November 7, 1994.
HIBERNIA CORPORATION
By: s/RON E. SAMFORD, JR.
Ron E. Samford, Jr.
Controller and Executive
Vice President
Pursuant to the requirements of the Securities Act of 1933,
the Registration Statement has been signed by the following persons
in the capacities indicated on November 7, 1994.
Signatures Title
*
_____________________________ Chairman of the Board
Robert H. Boh
*
_____________________________ President and Chief Executive
Stephen A. Hansel Officer and Director
*
_____________________________ Chief Financial Officer
Robert W. Close
*
_____________________________ Chief Accounting Officer
Ron E. Samford, Jr.
*
_____________________________ Director
W. James Amoss, Jr.
*
_____________________________ Director
J. Herbert Boydstun
*
_____________________________ Director
J. Terrell Brown
*
_____________________________ Director
Brooke H. Duncan
*
_____________________________ Director
Richard W. Freeman
*
_____________________________ Director
Robert L. Goodwin
*
_____________________________ Director
Dick H. Hearin
*
_____________________________ Director
Robert T. Holleman
*
_____________________________ Director
Hugh J. Kelly
*
_____________________________ Director
Elton R. King
*
_____________________________ Director
John P. Laborde
*
_____________________________ Director
Sidney W. Lassen
*
_____________________________ Director
Donald J. Nalty
*
_____________________________ Director
Robert T. Ratcliff
*
_____________________________ Director
James H. Stone
*
_____________________________ Director
H. Duke Shackelford
*
_____________________________ Director
Virginia Eason Weinmann
*
_____________________________ Director
E. L. Williamson
*
_____________________________ Director
Robert E. Zetzmann
*By: /s/ Patricia C. Meringer
PATRICIA C. MERINGER
Attorney-in-Fact
EXHIBIT INDEX
Exhibit Sequential
Page
Number
5 Opinion of Patricia C. Meringer, Esq.
23.1 Consent of Patricia C. Meringer, Esq.,
included with Exhibit 5.
23.2 Consent of Ernst & Young LLP.
23.3 Consent of Arthur Andersen & Co. LLP.
23.4 Consent of KPMG Peat Marwick LLP.
23.5 Consent of Roger C. Parker.
23.6 Consent of Castaing, Hussey and Lolan.
23.7 Consent of H. J. Lowe & Company.
23.8 Consent of Austin Associates, Inc.
24 Powers of Attorney.
99.6 Form of Proxy of First State Bank
and Trust Company of Bogalusa.
EXHIBIT 5
November 7, 1994
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Ladies and Gentlemen:
I am Associate Counsel and Secretary of Hibernia Corporation
(the "Company") and am delivering this opinion in connection with
the registration by the Company of shares of Class A Common Stock
(the "Shares) to be issued by the Company in a proposed merger (the
"Merger") between Hibernia National Bank, a subsidiary of the
Company ("HNB) and First State Bank and Trust Company ("First
State") in which the shareholders of First State will receive the
Shares in exchange for their shares of common stock of First State,
to which registration statement (the "Registration Statement") this
opinion is attached. The Shares will be reserved for issuance upon
the closing of the Merger. The Shares will be issued to
shareholders of First State upon consummation of the Merger
pursuant to the registration statement after it has been declared
effective by the Securities and Exchange Commission.
In furnishing this opinion, I or attorneys under my
supervision have examined such documents and have made such
investigation of matters of fact and law as I have deemed necessary
or appropriate to provide a basis for the opinions set forth
herein. In such examination and investigation, I have assumed the
genuineness of all signatures, the legal capacity of natural
persons, the authenticity of all documents submitted as originals
and the conformity to original documents of all documents submitted
as certified or photostatic copies.
In rendering this opinion, I do not express any opinion
concerning any law other than the law of the State of Louisiana and
the federal law of the United States, and I do not express any
opinion, either implicitly or otherwise, on any issue not expressly
addressed below.
Based upon and limited by the foregoing, and based upon legal
considerations which I deem relevant and upon laws or regulations
in effect as of the date hereof, I am of the opinion that:
1. Hibernia Corporation has been duly incorporated and is
validly existing and in good standing under the laws of the State
of Louisiana.
2. The Shares have been duly authorized and either are, or,
upon issuance thereof pursuant to the terms of the offering
thereof, will be, validly issued, fully paid and non-assessable.
I hereby expressly consent to the inclusion of this Opinion as
exhibit to the Registration Statement and to the reference to this
Opinion therein.
This opinion is being furnished to you pursuant to the filing
of the Registration Statement and may not be relied upon by any
other person or used for any other purpose, except as provided for
in the preceding paragraph.
Very truly yours,
/s/ PATRICIA C. MERINGER
Patricia C. Meringer
Associate Counsel
and Secretary
EXHIBIT 23.2
CONSENT OF ERNST & YOUNG LLP
Consent of Independent Auditors
We consent to the reference to our firm under the caption "Experts"
in the Registration Statement (Form S-4) and related Prospectus of
Hibernia Corporation for the registration of 3,350,000 shares of
its common stock to be issued pursuant to its proposed merger with
First State Bank and Trust Company of Bogalusa and to the
incorporation by reference therein of our reports (i) dated January
11, 1994, with respect to the consolidated financial statements of
Hibernia Corporation incorporated by reference in its Annual Report
(Form 10-K) for the year ended December 31, 1993, and (ii) dated
January 11, 1994, except for the pooling of interests with the
Other Pooled Companies described in Note 16, as to which the date
is August 1, 1994, with respect to the supplemental consolidated
financial statements of Hibernia Corporation included in its
Current Report on Form 8-K dated October 7, 1994, both filed with
the Securities and Exchange Commission.
/s/ERNST & YOUNG LLP
Ernst & Young LLP
New Orleans, Louisiana
November 1, 1994
EXHIBIT 23.3
CONSENT OF ARTHUR ANDERSEN & CO. LLP.
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation by reference in the Form S-4 and related prospectus
filed by Hibernia Corporation (Hibernia) under the Securities
Exchange Act of 1933 of our report dated February 14, 1994, with
respect to the consolidated statements of condition of First
Continental Bancshares, Inc. and subsidiary as of December 31, 1993
and 1992, and the related consolidated statements of income (loss),
cash flows and shareholders equity for each of the three years
ended December 31, 1993 included in Hibernia's Form 8-K dated
October 11, 1994.
/s/ Arthur Andersen LLP
ARTHUR ANDERSEN LLP
New Orleans, Louisiana
November 4, 1994
EXHIBIT 23.4
CONSENT OF KPMG PEAT MARWICK LLP
INDEPENDENT AUDITORS' CONSENT
We consent to the use of our report related to the consolidated
financial statements of First Bancorp of Louisiana, Inc. as of
December 31, 1993 and 1992, and for each of the years in the three-
year period ended December 31, 1993, incorporated by reference in
the registration statement filed by Hibernia Corporation on or
about November 3, 1994, and to the reference to our firm under the
heading "Experts" in the prospectus. Our report refers to a change
in 1993 in the method of accounting for income taxes.
/s/ KPMG PEAT MARWICK LLP
KPMG PEAT MARWICK LLP
Sheveport, Louisiana
November 2, 1994
EXHIBIT 23.5
CONSENT OF ROGER C. PARKER
INDEPENDENT AUDITORS' CONSENT
I consent to the reference of my firm under the caption "Experts"
in the registration statement (Form S-4) and related prospectus of
Hibernia Corporation for the registration of its common stock to be
issued pursuant to its proposed merger with First State Bank &
Trust of Bogalusa and to incorporation by reference therein of the
report dated January 12, 1994, relating to the balance sheets of
Bastrop National Bank as of December 31, 1993 and 1992, and the
related statements of income, stockholders' equity, and cash flows
for each of the years in the three-year period ended December 31,
1993, which report appears in the Hibernia Corporation Current
Report on Form 8-K dated November 3, 1994.
/s/ ROGER S. PARKER
Roger S. Parker
Certified Public Accountant
Monroe, LA
November 3, 1994
EXHIBIT 23.6
CONSENT OF CASTAING, HUSSEY & LOLAN
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts"
in the registration statement (Form S-4) and related prospectus of
Hibernia Corporation for the registration of its common stock to be
issued pursuant to its proposed merger with First State Bank and
Trust Company of Bogalusa and to incorporation by reference therein
of our report dated January 25, 1994, relating to the consolidated
balance sheets of Commercial Bancshares, Inc. as of December 31,
1993 and 1992, and the related consolidated statements of income,
stockholders' equity, and cash flows for each of the years in the
three-year period ended December 31, 1993, which report appears in
the Hibernia Corporation Current Report on Form 8-K dated October
11, 1994.
/s/ CASTAING, HUSSEY & LOLAN CPAS
Castaing, Hussey & Lolan CPAs
New Iberia, Louisiana
November 3, 1994
EXHIBIT 23.7
CONSENT OF H. J. LOWE & COMPANY, L.L.C.
CONSENT OF INDEPENDENT AUDITORS
We consent to the use of our independent auditors report dated
January 13, 1994, on the financial statements of First State Bank
and Trust Company as of and for the three years ending December 31,
1993, in the Registration Statement (Form S-4) and related
Prospectus of Hibernia Corporation for the registration of its
proposed merger of First State Bank and Trust Company.
/s/ H. J. LOWE & COMPANY, L.L.C.
H. J. LOWE & COMPANY, L.L.C.
Baton Rouge, Louisiana
November 1, 1994
EXHIBIT 23.8
CONSENT OF AUSTIN ASSOCIATES, INC.
CONSENT
We hereby consent to the discussion relative to our opinion
delivered to the Board of Directors of First State Bank & Trust
Company of Bogalusa, Louisiana, in connection with its proposed
acquisition by Hibernia Corporation, New Orleans, Louisiana, in the
Proxy Statement-Prospectus included in Hibernia's Registration
Statement on Form S-4 under the heading "Opinion of Financial
Advisor," to the references to our firm in such Proxy Statement-
Prospectus and to the inclusion of such opinion as an Appendix to
the Proxy Statement-Prospectus.
Austin Associates, Inc.
By: /s/ CRAIG J. MANCINOTTI
Craig J. Mancinotti
Executive Vice President and Principal
Toledo, OH
November 4, 1994
EXHIBIT 24
POWERS OF ATTORNEY
P0WER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
of Hibernia Corporation, a Louisiana corporation (the
"Corporation"), does hereby name, constitute and appoint Robert W.
Close, Patricia C. Meringer and Ron E. Samford, Jr., and each of
them (with full power to each of them to act alone), his true and
lawful agents and attorneys-in-fact, for him and on his behalf and
in his name, place and stead, in any and all capacities, to sign,
execute, acknowledge, deliver, and file (a) with the Securities and
Exchange Commission (or any other governmental or regulatory
authority), a Registration Statement on Form S-4 (or other
appropriate form) and any and all amendments (including post-
effective amendments) thereto, with any and all exhibits and any
and all other documents required to be filed with respect thereto
or in connection therewith, relating to the registration under the
Securities Act of 1933 of Common Stock of the Corporation to be
issued in the merger between Hibernia National Bank (the "Bank")
and First State Bank & Trust Company ("First State") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of First State and merge
First State into the Bank, authorized by resolutions adopted by the
Board of Directors on September 27, 1994, and (b) with the
securities agencies or officials of various jurisdictions, all
applications, qualifications, registrations or exemptions relating
to such offering under the laws of any such jurisdiction, including
any amendments thereto or other documents required to be filed with
respect thereto or in connection therewith, granting unto said
agents and attorneys, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary
to be done in and about the premises in order to effectuate the
same as fully to all intents and purposes as the undersigned might
or could do if personally present, and the undersigned hereby
ratifies and confirms all that said agents and attorneys-in-fact,
or any of them may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
on this 27th day of September, 1994.
s/W. JAMES AMOSS, JR.
W. James Amoss, Jr.
Director
HIBERNIA CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned Chairman
and Director of Hibernia Corporation, a Louisiana corporation (the
"Corporation"), does hereby name, constitute and appoint Robert W.
Close, Patricia C. Meringer and Ron E. Samford, Jr., and each of
them (with full power to each of them to act alone), his true and
lawful agents and attorneys-in-fact, for him and on his behalf and
in his name, place and stead, in any and all capacities, to sign,
execute, acknowledge, deliver, and file (a) with the Securities and
Exchange Commission (or any other governmental or regulatory
authority), a Registration Statement on Form S-4 (or other
appropriate form) and any and all amendments (including post-
effective amendments) thereto, with any and all exhibits and any
and all other documents required to be filed with respect thereto
or in connection therewith, relating to the registration under the
Securities Act of 1933 of Common Stock of the Corporation to be
issued in the merger between Hibernia National Bank (the "Bank")
and First State Bank & Trust Company ("First State") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of First State and merge
First State into the Bank, authorized by resolutions adopted by the
Board of Directors on September 27, 1994, and (b) with the
securities agencies or officials of various jurisdictions, all
applications, qualifications, registrations or exemptions relating
to such offering under the laws of any such jurisdiction, including
any amendments thereto or other documents required to be filed with
respect thereto or in connection therewith, granting unto said
agents and attorneys, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary
to be done in and about the premises in order to effectuate the
same as fully to all intents and purposes as the undersigned might
or could do if personally present, and the undersigned hereby
ratifies and confirms all that said agents and attorneys-in-fact,
or any of them may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
on this 27th day of September, 1994.
s/ROBERT H. BOH
Robert H. Boh
Chairman and Director
HIBERNIA CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
of Hibernia Corporation, a Louisiana corporation (the
"Corporation"), does hereby name, constitute and appoint Robert W.
Close, Patricia C. Meringer and Ron E. Samford, Jr., and each of
them (with full power to each of them to act alone), his true and
lawful agents and attorneys-in-fact, for him and on his behalf and
in his name, place and stead, in any and all capacities, to sign,
execute, acknowledge, deliver, and file (a) with the Securities and
Exchange Commission (or any other governmental or regulatory
authority), a Registration Statement on Form S-4 (or other
appropriate form) and any and all amendments (including post-
effective amendments) thereto, with any and all exhibits and any
and all other documents required to be filed with respect thereto
or in connection therewith, relating to the registration under the
Securities Act of 1933 of Common Stock of the Corporation to be
issued in the merger between Hibernia National Bank (the "Bank")
and First State Bank & Trust Company ("First State") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of First State and merge
First State into the Bank, authorized by resolutions adopted by the
Board of Directors on September 27, 1994, and (b) with the
securities agencies or officials of various jurisdictions, all
applications, qualifications, registrations or exemptions relating
to such offering under the laws of any such jurisdiction, including
any amendments thereto or other documents required to be filed with
respect thereto or in connection therewith, granting unto said
agents and attorneys, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary
to be done in and about the premises in order to effectuate the
same as fully to all intents and purposes as the undersigned might
or could do if personally present, and the undersigned hereby
ratifies and confirms all that said agents and attorneys-in-fact,
or any of them may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
on this 27th day of September, 1994.
s/J. HERBERT BOYDSTUN
J. Herbert Boydstun
Director
HIBERNIA CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
of Hibernia Corporation, a Louisiana corporation (the
"Corporation"), does hereby name, constitute and appoint Robert W.
Close, Patricia C. Meringer and Ron E. Samford, Jr., and each of
them (with full power to each of them to act alone), his true and
lawful agents and attorneys-in-fact, for him and on his behalf and
in his name, place and stead, in any and all capacities, to sign,
execute, acknowledge, deliver, and file (a) with the Securities and
Exchange Commission (or any other governmental or regulatory
authority), a Registration Statement on Form S-4 (or other
appropriate form) and any and all amendments (including post-
effective amendments) thereto, with any and all exhibits and any
and all other documents required to be filed with respect thereto
or in connection therewith, relating to the registration under the
Securities Act of 1933 of Common Stock of the Corporation to be
issued in the merger between Hibernia National Bank (the "Bank")
and First State Bank & Trust Company ("First State") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of First State and merge
First State into the Bank, authorized by resolutions adopted by the
Board of Directors on September 27, 1994, and (b) with the
securities agencies or officials of various jurisdictions, all
applications, qualifications, registrations or exemptions relating
to such offering under the laws of any such jurisdiction, including
any amendments thereto or other documents required to be filed with
respect thereto or in connection therewith, granting unto said
agents and attorneys, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary
to be done in and about the premises in order to effectuate the
same as fully to all intents and purposes as the undersigned might
or could do if personally present, and the undersigned hereby
ratifies and confirms all that said agents and attorneys-in-fact,
or any of them may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
on this 27th day of September, 1994.
s/J. TERRELL BROWN
J. Terrell Brown
Director
HIBERNIA CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
of Hibernia Corporation, a Louisiana corporation (the
"Corporation"), does hereby name, constitute and appoint Robert W.
Close, Patricia C. Meringer and Ron E. Samford, Jr., and each of
them (with full power to each of them to act alone), his true and
lawful agents and attorneys-in-fact, for him and on his behalf and
in his name, place and stead, in any and all capacities, to sign,
execute, acknowledge, deliver, and file (a) with the Securities and
Exchange Commission (or any other governmental or regulatory
authority), a Registration Statement on Form S-4 (or other
appropriate form) and any and all amendments (including post-
effective amendments) thereto, with any and all exhibits and any
and all other documents required to be filed with respect thereto
or in connection therewith, relating to the registration under the
Securities Act of 1933 of Common Stock of the Corporation to be
issued in the merger between Hibernia National Bank (the "Bank")
and First State Bank & Trust Company ("First State") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of First State and merge
First State into the Bank, authorized by resolutions adopted by the
Board of Directors on September 27, 1994, and (b) with the
securities agencies or officials of various jurisdictions, all
applications, qualifications, registrations or exemptions relating
to such offering under the laws of any such jurisdiction, including
any amendments thereto or other documents required to be filed with
respect thereto or in connection therewith, granting unto said
agents and attorneys, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary
to be done in and about the premises in order to effectuate the
same as fully to all intents and purposes as the undersigned might
or could do if personally present, and the undersigned hereby
ratifies and confirms all that said agents and attorneys-in-fact,
or any of them may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
on this 27th day of September, 1994.
s/BROOKE H. DUNCAN
Brooke H. Duncan
Director
HIBERNIA CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
of Hibernia Corporation, a Louisiana corporation (the
"Corporation"), does hereby name, constitute and appoint Robert W.
Close, Patricia C. Meringer and Ron E. Samford, Jr., and each of
them (with full power to each of them to act alone), his true and
lawful agents and attorneys-in-fact, for him and on his behalf and
in his name, place and stead, in any and all capacities, to sign,
execute, acknowledge, deliver, and file (a) with the Securities and
Exchange Commission (or any other governmental or regulatory
authority), a Registration Statement on Form S-4 (or other
appropriate form) and any and all amendments (including post-
effective amendments) thereto, with any and all exhibits and any
and all other documents required to be filed with respect thereto
or in connection therewith, relating to the registration under the
Securities Act of 1933 of Common Stock of the Corporation to be
issued in the merger between Hibernia National Bank (the "Bank")
and First State Bank & Trust Company ("First State") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of First State and merge
First State into the Bank, authorized by resolutions adopted by the
Board of Directors on September 27, 1994, and (b) with the
securities agencies or officials of various jurisdictions, all
applications, qualifications, registrations or exemptions relating
to such offering under the laws of any such jurisdiction, including
any amendments thereto or other documents required to be filed with
respect thereto or in connection therewith, granting unto said
agents and attorneys, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary
to be done in and about the premises in order to effectuate the
same as fully to all intents and purposes as the undersigned might
or could do if personally present, and the undersigned hereby
ratifies and confirms all that said agents and attorneys-in-fact,
or any of them may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
on this 27th day of September, 1994.
s/RICHARD W. FREEMAN, JR.
Richard W. Freeman, Jr.
Director
HIBERNIA CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
of Hibernia Corporation, a Louisiana corporation (the
"Corporation"), does hereby name, constitute and appoint Robert W.
Close, Patricia C. Meringer and Ron E. Samford, Jr., and each of
them (with full power to each of them to act alone), his true and
lawful agents and attorneys-in-fact, for him and on his behalf and
in his name, place and stead, in any and all capacities, to sign,
execute, acknowledge, deliver, and file (a) with the Securities and
Exchange Commission (or any other governmental or regulatory
authority), a Registration Statement on Form S-4 (or other
appropriate form) and any and all amendments (including post-
effective amendments) thereto, with any and all exhibits and any
and all other documents required to be filed with respect thereto
or in connection therewith, relating to the registration under the
Securities Act of 1933 of Common Stock of the Corporation to be
issued in the merger between Hibernia National Bank (the "Bank")
and First State Bank & Trust Company ("First State") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of First State and merge
First State into the Bank, authorized by resolutions adopted by the
Board of Directors on September 27, 1994, and (b) with the
securities agencies or officials of various jurisdictions, all
applications, qualifications, registrations or exemptions relating
to such offering under the laws of any such jurisdiction, including
any amendments thereto or other documents required to be filed with
respect thereto or in connection therewith, granting unto said
agents and attorneys, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary
to be done in and about the premises in order to effectuate the
same as fully to all intents and purposes as the undersigned might
or could do if personally present, and the undersigned hereby
ratifies and confirms all that said agents and attorneys-in-fact,
or any of them may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
on this 27th day of September, 1994.
s/ROBERT L. GOODWIN
Robert L. Goodwin
Director
HIBERNIA CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned
President, Chief Executive Officer and director of Hibernia
Corporation, a Louisiana corporation (the "Corporation"), does
hereby name, constitute and appoint Robert W. Close, Patricia C.
Meringer and Ron E. Samford, Jr., and each of them (with full power
to each of them to act alone), his true and lawful agents and
attorneys-in-fact, for him and on his behalf and in his name, place
and stead, in any and all capacities, to sign, execute,
acknowledge, deliver, and file (a) with the Securities and Exchange
Commission (or any other governmental or regulatory authority), a
Registration Statement on Form S-4 (or other appropriate form) and
any and all amendments (including post-effective amendments)
thereto, with any and all exhibits and any and all other documents
required to be filed with respect thereto or in connection
therewith, relating to the registration under the Securities Act of
1933 of Common Stock of the Corporation to be issued in the merger
between Hibernia National Bank (the "Bank") and First State Bank &
Trust Company ("First State") wherein the Corporation agrees to
exchange shares of its common stock for all of the outstanding
shares of common stock of First State and merge First State into
the Bank, authorized by resolutions adopted by the Board of
Directors on September 27, 1994, and (b) with the securities
agencies or officials of various jurisdictions, all applications,
qualifications, registrations or exemptions relating to such
offering under the laws of any such jurisdiction, including any
amendments thereto or other documents required to be filed with
respect thereto or in connection therewith, granting unto said
agents and attorneys, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary
to be done in and about the premises in order to effectuate the
same as fully to all intents and purposes as the undersigned might
or could do if personally present, and the undersigned hereby
ratifies and confirms all that said agents and attorneys-in-fact,
or any of them may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
on this 27th day of September, 1994.
s/STEPHEN A. HANSEL
Stephen A. Hansel
President, Chief Executive Officer
and Director
HIBERNIA CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
of Hibernia Corporation, a Louisiana corporation (the
"Corporation"), does hereby name, constitute and appoint Robert W.
Close, Patricia C. Meringer and Ron E. Samford, Jr., and each of
them (with full power to each of them to act alone), his true and
lawful agents and attorneys-in-fact, for him and on his behalf and
in his name, place and stead, in any and all capacities, to sign,
execute, acknowledge, deliver, and file (a) with the Securities and
Exchange Commission (or any other governmental or regulatory
authority), a Registration Statement on Form S-4 (or other
appropriate form) and any and all amendments (including post-
effective amendments) thereto, with any and all exhibits and any
and all other documents required to be filed with respect thereto
or in connection therewith, relating to the registration under the
Securities Act of 1933 of Common Stock of the Corporation to be
issued in the merger between Hibernia National Bank (the "Bank")
and First State Bank & Trust Company ("First State") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of First State and merge
First State into the Bank, authorized by resolutions adopted by the
Board of Directors on September 27, 1994, and (b) with the
securities agencies or officials of various jurisdictions, all
applications, qualifications, registrations or exemptions relating
to such offering under the laws of any such jurisdiction, including
any amendments thereto or other documents required to be filed with
respect thereto or in connection therewith, granting unto said
agents and attorneys, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary
to be done in and about the premises in order to effectuate the
same as fully to all intents and purposes as the undersigned might
or could do if personally present, and the undersigned hereby
ratifies and confirms all that said agents and attorneys-in-fact,
or any of them may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
on this 27th day of September, 1994.
s/DICK H. HEARIN
Dick H. Hearin
Director
HIBERNIA CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
of Hibernia Corporation, a Louisiana corporation (the
"Corporation"), does hereby name, constitute and appoint Robert W.
Close, Patricia C. Meringer and Ron E. Samford, Jr., and each of
them (with full power to each of them to act alone), his true and
lawful agents and attorneys-in-fact, for him and on his behalf and
in his name, place and stead, in any and all capacities, to sign,
execute, acknowledge, deliver, and file (a) with the Securities and
Exchange Commission (or any other governmental or regulatory
authority), a Registration Statement on Form S-4 (or other
appropriate form) and any and all amendments (including post-
effective amendments) thereto, with any and all exhibits and any
and all other documents required to be filed with respect thereto
or in connection therewith, relating to the registration under the
Securities Act of 1933 of Common Stock of the Corporation to be
issued in the merger between Hibernia National Bank (the "Bank")
and First State Bank & Trust Company ("First State") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of First State and merge
First State into the Bank, authorized by resolutions adopted by the
Board of Directors on September 27, 1994, and (b) with the
securities agencies or officials of various jurisdictions, all
applications, qualifications, registrations or exemptions relating
to such offering under the laws of any such jurisdiction, including
any amendments thereto or other documents required to be filed with
respect thereto or in connection therewith, granting unto said
agents and attorneys, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary
to be done in and about the premises in order to effectuate the
same as fully to all intents and purposes as the undersigned might
or could do if personally present, and the undersigned hereby
ratifies and confirms all that said agents and attorneys-in-fact,
or any of them may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
on this 27th day of September, 1994.
s/ROBERT T. HOLLEMAN
Robert T. Holleman
Director
HIBERNIA CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
of Hibernia Corporation, a Louisiana corporation (the
"Corporation"), does hereby name, constitute and appoint Robert W.
Close, Patricia C. Meringer and Ron E. Samford, Jr., and each of
them (with full power to each of them to act alone), his true and
lawful agents and attorneys-in-fact, for him and on his behalf and
in his name, place and stead, in any and all capacities, to sign,
execute, acknowledge, deliver, and file (a) with the Securities and
Exchange Commission (or any other governmental or regulatory
authority), a Registration Statement on Form S-4 (or other
appropriate form) and any and all amendments (including post-
effective amendments) thereto, with any and all exhibits and any
and all other documents required to be filed with respect thereto
or in connection therewith, relating to the registration under the
Securities Act of 1933 of Common Stock of the Corporation to be
issued in the merger between Hibernia National Bank (the "Bank")
and First State Bank & Trust Company ("First State") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of First State and merge
First State into the Bank, authorized by resolutions adopted by the
Board of Directors on September 27, 1994, and (b) with the
securities agencies or officials of various jurisdictions, all
applications, qualifications, registrations or exemptions relating
to such offering under the laws of any such jurisdiction, including
any amendments thereto or other documents required to be filed with
respect thereto or in connection therewith, granting unto said
agents and attorneys, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary
to be done in and about the premises in order to effectuate the
same as fully to all intents and purposes as the undersigned might
or could do if personally present, and the undersigned hereby
ratifies and confirms all that said agents and attorneys-in-fact,
or any of them may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
on this 27th day of September, 1994.
s/HUGH J. KELLY
Hugh J. Kelly
Director
HIBERNIA CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
of Hibernia Corporation, a Louisiana corporation (the
"Corporation"), does hereby name, constitute and appoint Robert W.
Close, Patricia C. Meringer and Ron E. Samford, Jr., and each of
them (with full power to each of them to act alone), his true and
lawful agents and attorneys-in-fact, for him and on his behalf and
in his name, place and stead, in any and all capacities, to sign,
execute, acknowledge, deliver, and file (a) with the Securities and
Exchange Commission (or any other governmental or regulatory
authority), a Registration Statement on Form S-4 (or other
appropriate form) and any and all amendments (including post-
effective amendments) thereto, with any and all exhibits and any
and all other documents required to be filed with respect thereto
or in connection therewith, relating to the registration under the
Securities Act of 1933 of Common Stock of the Corporation to be
issued in the merger between Hibernia National Bank (the "Bank")
and First State Bank & Trust Company ("First State") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of First State and merge
First State into the Bank, authorized by resolutions adopted by the
Board of Directors on September 27, 1994, and (b) with the
securities agencies or officials of various jurisdictions, all
applications, qualifications, registrations or exemptions relating
to such offering under the laws of any such jurisdiction, including
any amendments thereto or other documents required to be filed with
respect thereto or in connection therewith, granting unto said
agents and attorneys, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary
to be done in and about the premises in order to effectuate the
same as fully to all intents and purposes as the undersigned might
or could do if personally present, and the undersigned hereby
ratifies and confirms all that said agents and attorneys-in-fact,
or any of them may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
on this 27th day of September, 1994.
s/JOHN P. LABORDE
John P. Laborde
Director
HIBERNIA CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
of Hibernia Corporation, a Louisiana corporation (the
"Corporation"), does hereby name, constitute and appoint Robert W.
Close, Patricia C. Meringer and Ron E. Samford, Jr., and each of
them (with full power to each of them to act alone), his true and
lawful agents and attorneys-in-fact, for him and on his behalf and
in his name, place and stead, in any and all capacities, to sign,
execute, acknowledge, deliver, and file (a) with the Securities and
Exchange Commission (or any other governmental or regulatory
authority), a Registration Statement on Form S-4 (or other
appropriate form) and any and all amendments (including post-
effective amendments) thereto, with any and all exhibits and any
and all other documents required to be filed with respect thereto
or in connection therewith, relating to the registration under the
Securities Act of 1933 of Common Stock of the Corporation to be
issued in the merger between Hibernia National Bank (the "Bank")
and First State Bank & Trust Company ("First State") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of First State and merge
First State into the Bank, authorized by resolutions adopted by the
Board of Directors on September 27, 1994, and (b) with the
securities agencies or officials of various jurisdictions, all
applications, qualifications, registrations or exemptions relating
to such offering under the laws of any such jurisdiction, including
any amendments thereto or other documents required to be filed with
respect thereto or in connection therewith, granting unto said
agents and attorneys, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary
to be done in and about the premises in order to effectuate the
same as fully to all intents and purposes as the undersigned might
or could do if personally present, and the undersigned hereby
ratifies and confirms all that said agents and attorneys-in-fact,
or any of them may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
on this 27th day of September, 1994.
s/SIDNEY W. LASSEN
Sidney W. Lassen
director
HIBERNIA CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned Vice
Chairman and director of Hibernia Corporation, a Louisiana
corporation (the "Corporation"), does hereby name, constitute and
appoint Robert W. Close, Patricia C. Meringer and Ron E. Samford,
Jr., and each of them (with full power to each of them to act
alone), his true and lawful agents and attorneys-in-fact, for him
and on his behalf and in his name, place and stead, in any and all
capacities, to sign, execute, acknowledge, deliver, and file (a)
with the Securities and Exchange Commission (or any other
governmental or regulatory authority), a Registration Statement on
Form S-4 (or other appropriate form) and any and all amendments
(including post-effective amendments) thereto, with any and all
exhibits and any and all other documents required to be filed with
respect thereto or in connection therewith, relating to the
registration under the Securities Act of 1933 of Common Stock of
the Corporation to be issued in the merger between Hibernia
National Bank (the "Bank") and First State Bank & Trust Company
("First State") wherein the Corporation agrees to exchange shares
of its common stock for all of the outstanding shares of common
stock of First State and merge First State into the Bank,
authorized by resolutions adopted by the Board of Directors on
September 27, 1994, and (b) with the securities agencies or
officials of various jurisdictions, all applications,
qualifications, registrations or exemptions relating to such
offering under the laws of any such jurisdiction, including any
amendments thereto or other documents required to be filed with
respect thereto or in connection therewith, granting unto said
agents and attorneys, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary
to be done in and about the premises in order to effectuate the
same as fully to all intents and purposes as the undersigned might
or could do if personally present, and the undersigned hereby
ratifies and confirms all that said agents and attorneys-in-fact,
or any of them may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
on this 27th day of September, 1994.
s/DONALD J. NALTY
Donald J. Nalty
Vice Chairman and Director
HIBERNIA CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
of Hibernia Corporation, a Louisiana corporation (the
"Corporation"), does hereby name, constitute and appoint Robert W.
Close, Patricia C. Meringer and Ron E. Samford, Jr., and each of
them (with full power to each of them to act alone), his true and
lawful agents and attorneys-in-fact, for him and on his behalf and
in his name, place and stead, in any and all capacities, to sign,
execute, acknowledge, deliver, and file (a) with the Securities and
Exchange Commission (or any other governmental or regulatory
authority), a Registration Statement on Form S-4 (or other
appropriate form) and any and all amendments (including post-
effective amendments) thereto, with any and all exhibits and any
and all other documents required to be filed with respect thereto
or in connection therewith, relating to the registration under the
Securities Act of 1933 of Common Stock of the Corporation to be
issued in the merger between Hibernia National Bank (the "Bank")
and First State Bank & Trust Company ("First State") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of First State and merge
First State into the Bank, authorized by resolutions adopted by the
Board of Directors on September 27, 1994, and (b) with the
securities agencies or officials of various jurisdictions, all
applications, qualifications, registrations or exemptions relating
to such offering under the laws of any such jurisdiction, including
any amendments thereto or other documents required to be filed with
respect thereto or in connection therewith, granting unto said
agents and attorneys, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary
to be done in and about the premises in order to effectuate the
same as fully to all intents and purposes as the undersigned might
or could do if personally present, and the undersigned hereby
ratifies and confirms all that said agents and attorneys-in-fact,
or any of them may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
on this 27th day of September, 1994.
s/ROBERT T. RATCLIFF
Robert T. Ratcliff
Director
HIBERNIA CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
of Hibernia Corporation, a Louisiana corporation (the
"Corporation"), does hereby name, constitute and appoint Robert W.
Close, Patricia C. Meringer and Ron E. Samford, Jr., and each of
them (with full power to each of them to act alone), his true and
lawful agents and attorneys-in-fact, for him and on his behalf and
in his name, place and stead, in any and all capacities, to sign,
execute, acknowledge, deliver, and file (a) with the Securities and
Exchange Commission (or any other governmental or regulatory
authority), a Registration Statement on Form S-4 (or other
appropriate form) and any and all amendments (including post-
effective amendments) thereto, with any and all exhibits and any
and all other documents required to be filed with respect thereto
or in connection therewith, relating to the registration under the
Securities Act of 1933 of Common Stock of the Corporation to be
issued in the merger between Hibernia National Bank (the "Bank")
and First State Bank & Trust Company ("First State") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of First State and merge
First State into the Bank, authorized by resolutions adopted by the
Board of Directors on September 27, 1994, and (b) with the
securities agencies or officials of various jurisdictions, all
applications, qualifications, registrations or exemptions relating
to such offering under the laws of any such jurisdiction, including
any amendments thereto or other documents required to be filed with
respect thereto or in connection therewith, granting unto said
agents and attorneys, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary
to be done in and about the premises in order to effectuate the
same as fully to all intents and purposes as the undersigned might
or could do if personally present, and the undersigned hereby
ratifies and confirms all that said agents and attorneys-in-fact,
or any of them may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
on this 27th day of September, 1994.
s/H. DUKE SHACKELFORD
H. Duke Shackelford
Director
HIBERNIA CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
of Hibernia Corporation, a Louisiana corporation (the
"Corporation"), does hereby name, constitute and appoint Robert W.
Close, Patricia C. Meringer and Ron E. Samford, Jr., and each of
them (with full power to each of them to act alone), his true and
lawful agents and attorneys-in-fact, for him and on his behalf and
in his name, place and stead, in any and all capacities, to sign,
execute, acknowledge, deliver, and file (a) with the Securities and
Exchange Commission (or any other governmental or regulatory
authority), a Registration Statement on Form S-4 (or other
appropriate form) and any and all amendments (including post-
effective amendments) thereto, with any and all exhibits and any
and all other documents required to be filed with respect thereto
or in connection therewith, relating to the registration under the
Securities Act of 1933 of Common Stock of the Corporation to be
issued in the merger between Hibernia National Bank (the "Bank")
and First State Bank & Trust Company ("First State") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of First State and merge
First State into the Bank, authorized by resolutions adopted by the
Board of Directors on September 27, 1994, and (b) with the
securities agencies or officials of various jurisdictions, all
applications, qualifications, registrations or exemptions relating
to such offering under the laws of any such jurisdiction, including
any amendments thereto or other documents required to be filed with
respect thereto or in connection therewith, granting unto said
agents and attorneys, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary
to be done in and about the premises in order to effectuate the
same as fully to all intents and purposes as the undersigned might
or could do if personally present, and the undersigned hereby
ratifies and confirms all that said agents and attorneys-in-fact,
or any of them may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
on this 27th day of September, 1994.
s/JAMES H. STONE
James H. Stone
Director
HIBERNIA CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
of Hibernia Corporation, a Louisiana corporation (the
"Corporation"), does hereby name, constitute and appoint Robert W.
Close, Patricia C. Meringer and Ron E. Samford, Jr., and each of
them (with full power to each of them to act alone), his true and
lawful agents and attorneys-in-fact, for him and on his behalf and
in his name, place and stead, in any and all capacities, to sign,
execute, acknowledge, deliver, and file (a) with the Securities and
Exchange Commission (or any other governmental or regulatory
authority), a Registration Statement on Form S-4 (or other
appropriate form) and any and all amendments (including post-
effective amendments) thereto, with any and all exhibits and any
and all other documents required to be filed with respect thereto
or in connection therewith, relating to the registration under the
Securities Act of 1933 of Common Stock of the Corporation to be
issued in the merger between Hibernia National Bank (the "Bank")
and First State Bank & Trust Company ("First State") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of First State and merge
First State into the Bank, authorized by resolutions adopted by the
Board of Directors on September 27, 1994, and (b) with the
securities agencies or officials of various jurisdictions, all
applications, qualifications, registrations or exemptions relating
to such offering under the laws of any such jurisdiction, including
any amendments thereto or other documents required to be filed with
respect thereto or in connection therewith, granting unto said
agents and attorneys, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary
to be done in and about the premises in order to effectuate the
same as fully to all intents and purposes as the undersigned might
or could do if personally present, and the undersigned hereby
ratifies and confirms all that said agents and attorneys-in-fact,
or any of them may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
on this 27th day of September, 1994.
s/ERNEST L. WILLIAMSON
Ernest L. Williamson
Director
HIBERNIA CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
of Hibernia Corporation, a Louisiana corporation (the
"Corporation"), does hereby name, constitute and appoint Robert W.
Close, Patricia C. Meringer and Ron E. Samford, Jr., and each of
them (with full power to each of them to act alone), his true and
lawful agents and attorneys-in-fact, for him and on his behalf and
in his name, place and stead, in any and all capacities, to sign,
execute, acknowledge, deliver, and file (a) with the Securities and
Exchange Commission (or any other governmental or regulatory
authority), a Registration Statement on Form S-4 (or other
appropriate form) and any and all amendments (including post-
effective amendments) thereto, with any and all exhibits and any
and all other documents required to be filed with respect thereto
or in connection therewith, relating to the registration under the
Securities Act of 1933 of Common Stock of the Corporation to be
issued in the merger between Hibernia National Bank (the "Bank")
and First State Bank & Trust Company ("First State") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of First State and merge
First State into the Bank, authorized by resolutions adopted by the
Board of Directors on September 27, 1994, and (b) with the
securities agencies or officials of various jurisdictions, all
applications, qualifications, registrations or exemptions relating
to such offering under the laws of any such jurisdiction, including
any amendments thereto or other documents required to be filed with
respect thereto or in connection therewith, granting unto said
agents and attorneys, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary
to be done in and about the premises in order to effectuate the
same as fully to all intents and purposes as the undersigned might
or could do if personally present, and the undersigned hereby
ratifies and confirms all that said agents and attorneys-in-fact,
or any of them may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
on this 27th day of September, 1994.
s/VIRGINIA E. WEINMANN
Virginia E. Weinmann
Director
HIBERNIA CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
of Hibernia Corporation, a Louisiana corporation (the
"Corporation"), does hereby name, constitute and appoint Robert W.
Close, Patricia C. Meringer and Ron E. Samford, Jr., and each of
them (with full power to each of them to act alone), his true and
lawful agents and attorneys-in-fact, for him and on his behalf and
in his name, place and stead, in any and all capacities, to sign,
execute, acknowledge, deliver, and file (a) with the Securities and
Exchange Commission (or any other governmental or regulatory
authority), a Registration Statement on Form S-4 (or other
appropriate form) and any and all amendments (including post-
effective amendments) thereto, with any and all exhibits and any
and all other documents required to be filed with respect thereto
or in connection therewith, relating to the registration under the
Securities Act of 1933 of Common Stock of the Corporation to be
issued in the merger between Hibernia National Bank (the "Bank")
and First State Bank & Trust Company ("First State") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of First State and merge
First State into the Bank, authorized by resolutions adopted by the
Board of Directors on September 27, 1994, and (b) with the
securities agencies or officials of various jurisdictions, all
applications, qualifications, registrations or exemptions relating
to such offering under the laws of any such jurisdiction, including
any amendments thereto or other documents required to be filed with
respect thereto or in connection therewith, granting unto said
agents and attorneys, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary
to be done in and about the premises in order to effectuate the
same as fully to all intents and purposes as the undersigned might
or could do if personally present, and the undersigned hereby
ratifies and confirms all that said agents and attorneys-in-fact,
or any of them may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
on this 27th day of September, 1994.
s/ROBERT E. ZETZMANN
Robert E. Zetzmann
Director
HIBERNIA CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned Chief
Financial Officer of Hibernia Corporation, a Louisiana corporation
(the "Corporation"), does hereby name, constitute and appoint
Robert W. Close, Patricia C. Meringer and Ron E. Samford, Jr., and
each of them (with full power to each of them to act alone), his
true and lawful agents and attorneys-in-fact, for him and on his
behalf and in his name, place and stead, in any and all capacities,
to sign, execute, acknowledge, deliver, and file (a) with the
Securities and Exchange Commission (or any other governmental or
regulatory authority), a Registration Statement on Form S-4 (or
other appropriate form) and any and all amendments (including
post-effective amendments) thereto, with any and all exhibits and
any and all other documents required to be filed with respect
thereto or in connection therewith, relating to the registration
under the Securities Act of 1933 of Common Stock of the Corporation
to be issued in the merger between Hibernia National Bank (the
"Bank") and First State Bank & Trust Company ("First State")
wherein the Corporation agrees to exchange shares of its common
stock for all of the outstanding shares of common stock of First
State and merge First State into the Bank, authorized by
resolutions adopted by the Board of Directors on September 27,
1994, and (b) with the securities agencies or officials of various
jurisdictions, all applications, qualifications, registrations or
exemptions relating to such offering under the laws of any such
jurisdiction, including any amendments thereto or other documents
required to be filed with respect thereto or in connection
therewith, granting unto said agents and attorneys, and each of
them, full power and authority to do and perform each and every act
and thing requisite and necessary to be done in and about the
premises in order to effectuate the same as fully to all intents
and purposes as the undersigned might or could do if personally
present, and the undersigned hereby ratifies and confirms all that
said agents and attorneys-in-fact, or any of them may lawfully do
or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
on this 27th day of September, 1994.
s/ROBERT W. CLOSE
Robert W. Close
Director
HIBERNIA CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned Chief
Accounting Officer of Hibernia Corporation, a Louisiana corporation
(the "Corporation"), does hereby name, constitute and appoint
Robert W. Close, Patricia C. Meringer and Ron E. Samford, Jr., and
each of them (with full power to each of them to act alone), his
true and lawful agents and attorneys-in-fact, for him and on his
behalf and in his name, place and stead, in any and all capacities,
to sign, execute, acknowledge, deliver, and file (a) with the
Securities and Exchange Commission (or any other governmental or
regulatory authority), a Registration Statement on Form S-4 (or
other appropriate form) and any and all amendments (including
post-effective amendments) thereto, with any and all exhibits and
any and all other documents required to be filed with respect
thereto or in connection therewith, relating to the registration
under the Securities Act of 1933 of Common Stock of the Corporation
to be issued in the merger between Hibernia National Bank (the
"Bank") and First State Bank & Trust Company ("First State")
wherein the Corporation agrees to exchange shares of its common
stock for all of the outstanding shares of common stock of First
State and merge First State into the Bank, authorized by
resolutions adopted by the Board of Directors on September 27,
1994, and (b) with the securities agencies or officials of various
jurisdictions, all applications, qualifications, registrations or
exemptions relating to such offering under the laws of any such
jurisdiction, including any amendments thereto or other documents
required to be filed with respect thereto or in connection
therewith, granting unto said agents and attorneys, and each of
them, full power and authority to do and perform each and every act
and thing requisite and necessary to be done in and about the
premises in order to effectuate the same as fully to all intents
and purposes as the undersigned might or could do if personally
present, and the undersigned hereby ratifies and confirms all that
said agents and attorneys-in-fact, or any of them may lawfully do
or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
on this 27th day of September, 1994.
s/RON E. SAMFORD, JR.
Ron E. Samford, Jr.
Director
HIBERNIA CORPORATION
