As Filed with the Securities and Exchange Commission on
September 25, 1997
REGISTRATION NO. 333-35625
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
_____________________________
AMENDMENT NO. 1 TO
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
(Re-filing of an S-4 filed on September 15, 1997)
_____________________________
HIBERNIA CORPORATION
(Exact name of registrant as specified in its charter)
Louisiana 6711 72-0724532
(State or other (Primary Standard (I.R.S. Employer
jurisdiction of Industrial Identification No.)
incorporation or Classification
organization) Code Number)
313 Carondelet Street
New Orleans, Louisiana 70130
(504) 533-5332
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
_____________________________
Gary L. Ryan
Senior Vice President and Corporate 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:
Mark A. Fullmer, Esq. Brian R. Marek, Esq.
Locke Purnell Rain Harrell Jenkens & Gilchrist, P.C.
Pan American Life Center Suite 3200
601 Poydras Street, Suite 2400 1445 Ross Avenue
New Orleans, Louisiana 70130-6036 Dallas, Texas 75202-2799
(504) 558-5148 (214) 855-4500
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE OF
SECURITIES TO THE PUBLIC:
As soon as practicable after this registration
statement is declared effective.
If the securities being registered on this Form are
being offered in connection with the formation of a holding
company and there is compliance with General Instruction G,
check the following box. ______
/______/
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON
SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS
EFFECTIVE DATE UNTIL THE REGISTRANT WILL FILE A FURTHER
AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT WILL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE
WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933, OR UNTIL
THE REGISTRATION STATEMENT WILL BECOME EFFECTIVE ON SUCH
DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION
8(A), MAY DETERMINE.
HIBERNIA CORPORATION
Cross Reference Sheet Pursuant to Rule 404 of Regulation C
Item of Form S-4 Location or Caption
in Proxy Statement
(Prospectus)
1. Forepart of Registration Statement Outside Front
and Outside Front Cover Page of Cover Page
Proxy Statement-Prospectus
2. Inside Front and Outside Back Table of Contents;
Cover Pages of Proxy Statement- Available Information;
Prospectus Incorporation by
Reference
3. Risk Factors, Ratio of Earnings Introduction; The
to Fixed Charges and Other Parties to the Merger;
Information Summary; Proposed Merger;
Certain Regulatory
Considerations
4. Terms of the Transaction Introduction; Summary;
Proposed Merger
5. Pro Forma Financial Pro Forma Financial
Information Information
6. Material Contacts with the Proposed Merger
Company Being Acquired
7. Additional Information Required Not Applicable
for Reoffering by Persons and
Parties Deemed to be Underwriters
8. Interests of Named Experts and Validity of Shares
Counsel
9. Disclosure of Commission Position Not Applicable
on Indemnification for Securities
Act Liabilities
10. Information with Respect to Introduction; Available
S-3 Registrants Information;
Incorporation of
Certain Documents by
Reference; The Parties to
the Merger
11. Incorporation of Certain Available Information;
Information by Reference Incorporation of Certain
Documents by Reference
12. Information with Respect to Not Applicable
S-2 or S-3 Registrants
13. Incorporation of Certain Not Applicable
Information by Reference
14. Information with Respect to Not Applicable
Registrants other than
S-3 or S-2 Registrants
15. Information with Respect to Not Applicable
S-3 Companies
16. Information with Respect to Not Applicable
S-2 or S-3 Companies
17. Information with Respect to Summary; The Parties to
Companies Other Than S-3 or the Merger; Certain
S-2 Companies Information Concerning
Unicorp ; Management's
Discussion and Analysis
of Financial Condition
and Results of Operations
of Unicorp
18. Information if Proxies, Outside Front Cover Page;
Consents or Authorizations Introduction;
are to be Solicited The Parties to the
Merger; Summary; Meeting
Information; Proposed
Merger; Certain
Information Concerning
Unicorp; Relationship
with Independent Auditors
19. Information if Proxies, Not Applicable
Consents, or Authorizations are
not to be Solicited or in an
Exchange Offer
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
OF
UNICORP BANCSHARES-TEXAS, INC.
________ __, 1997
NOTICE IS HEREBY GIVEN that, pursuant to the call of
the Board of Directors of Unicorp Bancshares-Texas, Inc.
("Unicorp"), a Special Meeting of the shareholders of
Unicorp will be held at the main office of Unicorp
Bancshares-Texas, Inc., (which is also the main office of
OrangeBank), 302 N. 5th Street, Orange, Texas 77630-5707 on
________ __, 1997 at _____ _.m., for the purpose of
considering and voting upon the following matters:
1. A proposal to approve (a) the Amended and
Restated Agreement and Plan of Merger, effective
as of May 28, 1997 (the "Agreement") between
Unicorp and Hibernia Corporation ("Hibernia")
pursuant to which (i) Unicorp will be merged (the
"Merger") into Hibernia (which will survive the
Merger), and (ii) each outstanding share of common
stock, $1.00 per share par value, of Unicorp
("Unicorp Common Stock") will be converted into
1.6 shares of common stock, no par value, of
Hibernia (as described more fully in the
accompanying Proxy Statement - Prospectus) and (b)
the Merger.
2. The transaction of such other business as may
properly come before the Special Meeting and any
adjournments or postponements thereof.
The Board of Directors has fixed the close of business
on _______ __, 1997 as the record date for determining the
shareholders entitled to receive notice of, and to vote at,
the Special Meeting.
Each share of Unicorp Common Stock will entitle the
holder thereof to one vote on all matters that come before
the Special Meeting. Approval of the Merger will require
the affirmative vote of two-thirds of the issued and
outstanding shares of Unicorp Common Stock, in person or by
proxy, at the Special Meeting.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT
HOLDERS OF UNICORP COMMON STOCK VOTE "FOR" THE APPROVAL OF
THE AGREEMENT AND THE MERGER.
Whether you intend to attend the Special Meeting, and
regardless of the number of shares you own, your vote is
important. Please take a moment to complete, date and sign
the enclosed proxy card. Your proxy may be revoked by
notice to the Secretary of Unicorp prior to the date of the
Special Meeting, by attending the Special Meeting or by
executing and delivering a later dated proxy to the
Secretary prior to the Special Meeting.
By Order of the Board of Directors,
Shirley Hall
Secretary
PROXY STATEMENT
UNICORP BANCSHARES-TEXAS, INC.
SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON ________ __, 1997
PROSPECTUS
HIBERNIA CORPORATION
2,233,389 SHARES OF
CLASS A COMMON STOCK
(NO PAR VALUE)
This Proxy Statement-Prospectus is being furnished to
the holders of common stock, par value $1.00 per share (the
"Unicorp Common Stock"), of Unicorp Bancshares-Texas, Inc.,
a Texas corporation ("Unicorp"), in connection with the
solicitation of proxies by the Board of Directors of Unicorp
for use at a special meeting of shareholders (the "Special
Meeting") to be held at _____ _.m., local time, on ________
__, 1997, at the office of Unicorp (which is the main office
of OrangeBank), 302 N. 5th Street, Orange, Texas 77630-5707,
and at any adjournments or postponements thereof.
At the Special Meeting, the holders of record of
Unicorp Common Stock as of the close of business on _______
__, 1997 (the "Record Date") will consider and vote upon a
proposal to approve (a) the Amended and Restated Agreement
and Plan of Merger effective as of May 28, 1997 (the
"Agreement") between Unicorp and Hibernia Corporation
("Hibernia") pursuant to which (i) Unicorp will be merged
(the "Merger") into Hibernia and Hibernia will be the
corporation surviving the Merger and (ii) each outstanding
share of Unicorp Common Stock, except for shares of Unicorp
Common Stock owned by Hibernia or its subsidiaries and
shares as to which dissenters' rights have been exercised
and perfected under Texas law, will be converted into 1.6
shares of common stock, no par value, of Hibernia ("Hibernia
Common Stock"), and (b) the Merger. Cash will be paid to
holders of Unicorp Common Stock in lieu of issuing
fractional shares. For a description of the Agreement,
which is included in its entirety as Appendix A to this
Proxy Statement-Prospectus, see "PROPOSED MERGER."
This Proxy Statement-Prospectus also constitutes a
prospectus of Hibernia with respect to the shares of
Hibernia Common Stock to be issued pursuant to the Agreement
if the Merger is consummated. See "PROPOSED MERGER -- Terms
of the Merger."
The outstanding shares of Hibernia Common Stock are
listed on the New York Stock Exchange, Inc. (the "NYSE").
The last reported sale price of Hibernia Common Stock on the
NYSE Composite Transactions Reporting System on September
__, 1997 was $______ per share.
This Proxy Statement-Prospectus and the accompanying
proxy card are first being mailed to shareholders of Unicorp
on or about September __, 1997.
No person is authorized to give any information or to
make any representations other than those contained in this
Proxy Statement-Prospectus, and, if given or made, such
information or representation may not be relied upon as
having been made by Hibernia or Unicorp.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED
BY THE SECURITIES AND EXCHANGE COMMISSION NOR HAS THE
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROXY STATEMENT-PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
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.
The date of this Proxy Statement-Prospectus is September __,
1997.
TABLE OF CONTENTS
Page
INTRODUCTION...............................................
AVAILABLE INFORMATION......................................
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE............
THE PARTIES TO THE MERGER..................................
Hibernia..............................................
Unicorp...............................................
Pro Forma Selected Financial Information
(Unaudited).........................................
Comparative Per Share Information (Unaudited).........
SUMMARY....................................................
The Proposed Merger...................................
Management and Operations After the Merger............
Recommendation of the Board of Directors..............
Basis for the Terms of the Merger.....................
Advice and Opinion of Financial Advisor...............
Votes Required........................................
Conditions; Abandonment; Amendment....................
Interests of Certain Persons in the Merger............
Employee Benefits.....................................
Material Tax Consequences.............................
Dissenters' Rights....................................
Differences in Shareholders' Rights...................
Accounting Treatment..................................
Other Pending Merger Transactions for Hibernia........
MEETING INFORMATION........................................
Solicitation and Revocation of Proxies................
Vote Required.........................................
Recommendation........................................
PROPOSED MERGER............................................
General...............................................
Background of and Reasons for the Merger..............
Terms of the Merger...................................
Opinion of Financial Advisor..........................
Effective Date of the Merger..........................
Employee Benefits.....................................
Surrender and Exchange of Stock Certificates..........
Expenses..............................................
Representations and Warranties;
Conditions to the Merger; Waiver....................
Regulatory and Other Approvals........................
Business Pending the Merger...........................
Management and Operations After the Merger............
Certain Differences in Rights of Shareholders.........
Interests of Certain Persons in the Merger............
Material Tax Consequences.............................
Resale of Hibernia Common Stock.......................
Rights of Dissenting Shareholders.....................
Dividend Reinvestment Plan...........................
Accounting Treatment.................................
CERTAIN REGULATORY CONSIDERATIONS.........................
PRO FORMA FINANCIAL INFORMATION...........................
CERTAIN INFORMATION CONCERNING UNICORP....................
OWNERSHIP OF MANAGEMENT...................................
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS OF UNICORP
December 31, 1996 and 1995...............................
Unicorp Quarterly Financial Statements
(Unaudited) for the period ended March 31, 1997....
Management's Discussion and Analysis of Financial
Condition and Results of Operation
March 31, 1997 and 1996............................
RELATIONSHIP WITH INDEPENDENT AUDITORS....................
VALIDITY OF SHARES........................................
EXPERTS...................................................
UNICORP CONSOLIDATED FINANCIAL INFORMATION................
APPENDIX A -- AGREEMENT AND PLAN OF MERGER
APPENDIX B -- OPINION OF FIRST CAPITAL GROUP, L.L.C.
APPENDIX C -- SELECTED PROVISIONS OF THE TEXAS BUSINESS
CORPORATION ACT RELATING TO RIGHTS OF
DISSENTING SHAREHOLDERS
APPENDIX D -- OPINION OF ERNST & YOUNG LLP REGARDING CERTAIN
TAX MATTERS
INTRODUCTION
If the shareholders of Unicorp approve the Agreement
and the Merger, Unicorp will be merged into Hibernia, and
Hibernia will be the corporation surviving the Merger. If
the Merger is completed, shareholders of Unicorp (except for
shareholders who exercise and perfect their dissenters'
rights under Texas law) will receive 1.6 shares of Hibernia
Common Stock for each share of Unicorp Common Stock they own
at the time the Merger is effective. Shareholders of
Unicorp will be paid cash in lieu of any fractional shares
of Hibernia Common Stock to which they may otherwise be
entitled. See "PROPOSED MERGER -- Terms of the Merger."
This Registration Statement relates to 2,233,389 shares of
Hibernia Common Stock, which is the maximum number of shares
of Hibernia Common Stock that Hibernia will issue to the
shareholders of Unicorp in connection with the Merger.
Shareholders of Unicorp will be asked to approve the
Agreement and the Merger at a Special Meeting to be held on
________ __, 1997. The proxy statement relating to such
Special Meeting is included in this Proxy Statement-
Prospectus.
The terms of the Merger are described in this Proxy
Statement-Prospectus (see "Proposed Merger"), and a copy of
the Agreement is attached hereto as Appendix A for
reference.
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 "Commission"). Such reports,
proxy statements and other information can be inspected and
copied at the public reference facilities of 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 10007 and
500 West Madison Street, Suite 1400, Chicago, Illinois
60661-2511. Copies of such materials can be obtained from
the Public Reference Section of the Commission at 450 Fifth
Street, N.W., Washington, D.C. 20549, at prescribed rates.
The Commission maintains a Web Site that contains reports,
proxy and information statements and other information and
the address of that site is http://www.sec.gov. In
addition, reports, proxy statements and other information
concerning Hibernia may be inspected at the offices of the
New York Stock Exchange, Inc. (the "NYSE"), 20 Broad Street,
New York, New York 10005, on which the shares of Hibernia
Common Stock are listed.
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 Hibernia Common Stock offered hereby.
This Proxy Statement-Prospectus does not contain all of the
information set forth in the Registration Statement. For
further information with respect to Hibernia and the
Hibernia Common Stock offered hereby, reference is hereby
made to the Registration Statement. Statements contained in
this Proxy Statement-Prospectus 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-
Prospectus relating to Hibernia and its subsidiaries has
been supplied by Hibernia, and all information relating to
Unicorp and its subsidiaries has been supplied by Unicorp.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
Incorporated by reference in this Proxy Statement-
Prospectus are the following documents filed by Hibernia
with the Commission pursuant to the Exchange Act:
Hibernia's (1) Annual Report on Form 10-K for the year ended
December 31, 1996, (2) definitive Proxy Statement dated
March 19, 1997 relating to its 1997 Annual Meeting of
Shareholders held on April 29, 1997 except for the
information contained therein under the headings "Executive
Compensation -- Report of the Executive Compensation
Committee" and "Executive Compensation -- Stock Performance
Graph", which are expressly excluded from incorporation in
this Registration Statement, (3) Quarterly Reports on Form
10-Q for the fiscal quarters ended March 31 and June 30,
1997, (4) the Description of Capital Stock included in its
Current Report on Form 8-K dated November 2, 1994, and (5)
Current Reports on Form 8-K dated July 1 and July 28, 1997.
All documents 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-
Prospectus and prior to the termination of the offering of
Hibernia Common Stock made hereby will be deemed to be
incorporated by reference in this Proxy Statement-Prospectus
and to be a part hereof from the date such documents are
filed, except that any and all information included in any
proxy statement filed by Hibernia under the headings
"Executive Compensation -- Report of the Executive
Compensation Committee" and "Executive Compensation -- Stock
Performance Graph" are hereby expressly excluded from such
incorporation by reference. No statement made herein will
be deemed to modify or supersede any statement contained in
a document incorporated or deemed to be incorporated by
reference. Any statement so modified or superseded will not
be deemed, except as so modified or superseded, to
constitute a part of this Proxy Statement-Prospectus.
Hibernia will provide, without charge, to each person,
including any beneficial owner, to whom this Proxy Statement-
Prospectus is delivered, at the written or oral request of
any such person, a copy of any or all of the information
incorporated herein by reference other than exhibits to such
information (unless such exhibits are specifically
incorporated by reference into such information). Written
or oral requests should be directed to Hibernia Corporation,
313 Carondelet Street, New Orleans, Louisiana 70130,
Attention: Assistant Secretary, Telephone (504) 533-3411.
To ensure timely delivery, any request should be made before
__________, 1997.
THE PARTIES TO THE MERGER
Hibernia
Hibernia is a Louisiana corporation registered under
the Bank Holding Company Act of 1956, as amended ("BHCA").
As of June 30, 1997, Hibernia had total consolidated assets
of approximately $9.7 billion and shareholders' equity of
approximately $970 million. As of June 30, 1997, Hibernia
was ranked, on the basis of total assets, as the second
largest bank holding company headquartered in Louisiana.
As of June 30, 1997, Hibernia had two banking
subsidiaries, Hibernia National Bank ("HNB"), that provides
retail and commercial banking services through approximately
202 banking offices throughout Louisiana, and Hibernia
National Bank of Texas ("HNBT"), that provides retail and
commercial banking services through approximately 10 banking
offices in two Texas counties. As of June 30, 1997, HNB was
the largest bank headquartered in Louisiana.
From time to time, Hibernia investigates and holds
discussions and negotiations in connection with possible
mergers or similar transactions with other financial
institutions. At the date hereof, Hibernia has entered into
three definitive merger agreements with financial
institutions other than Unicorp. See "Summary -- Other
Pending Merger Transactions for Hibernia". Hibernia expects
to pursue other possible acquisition opportunities and
intends to continue to pursue such opportunities in the near
future when available and feasible in the light of
Hibernia's business and strategic plans. 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. If required under applicable
law, any such transactions would be subject to regulatory
approval and the approval of shareholders of the acquired
institution.
The principal executive offices of Hibernia are located
at 313 Carondelet Street, New Orleans, Louisiana 70130, and
its telephone number is (504) 533-5532. For additional
information concerning the business and financial condition
of Hibernia, reference is made to the Hibernia reports
incorporated herein by reference. See "INCORPORATION OF
CERTAIN DOCUMENTS BY REFERENCE."
Selected Financial Data. The closing market price per share
of Hibernia Common Stock on the NYSE on May 27, 1997, the
business day prior to the announcement of the proposed
Merger was $13.00. There can be no assurance of the market
price of Hibernia Common Stock on the Closing Date.
<PAGE>
The following table sets forth certain consolidated financial
information for Hibernia. This information is based on the consolidated
financial statements and related notes of Hibernia contained in (i) its Annual
Report on Form 10-K for the year ended December 31, 1996 and (ii) its Quarterly
Report on Form 10-Q for June 30, 1997. See "INCORPORATION OF CERTAIN
DOCUMENTS BY REFERENCE".
<PAGE>
<TABLE>
<CAPTION>
HIBERNIA CORPORATION
SELECTED FINANCIAL INFORMATION
Year Ended December 31 6 Months Ended June 30
- ------------------------------------------------------------------------------------------------------------------------------------
Unaudited ($ in thousands, except per share amounts)
1996 1995 1994 1993 1992 1997 1996
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Net interest income ................ $ 366,217 $ 320,756 $ 301,116 $ 295,990 $ 293,134 $ 203,123 $ 175,194
Income from continuing operations .. 109,950 128,885 101,460 72,708 12,750 63,549 54,445
Per common share:
Income from continuing operations 0.85 1.02 0.80 0.57 0.17 0.47 0.43
Cash dividends .................. 0.29 0.25 0.19 0.03 - 0.16 0.14
Book value ...................... 6.58 6.07 4.99 4.67 4.73 6.84 6.18
SELECTED PERIOD-END BALANCES
Debt ............................... 51,349 34,361 21,012 39,198 39,071 7,028 26,842
Total assets ....................... 9,306,796 7,755,719 7,294,469 7,119,012 6,970,946 9,673,268 7,855,221
</TABLE>
Unicorp
Unicorp is a Texas corporation and a registered bank
holding company under the BHCA which owns all of the issued
and outstanding shares of stock of Unicorp Bancshares-
Delaware, Inc., a Delaware Corporation and a registered bank
holding company under the BHCA ("UB-Delaware"). UB-Delaware
owns all of the outstanding stock of OrangeBank, a Texas
banking corporation (the "Bank"). As of June 30, 1997,
Unicorp had total consolidated assets of $115 million and
shareholders' equity of $8 million. The Bank has three (3)
offices in Orange County, Texas. The Bank engages in retail
and commercial banking services, including taking deposits
and extending secured and unsecured credit.
The principal offices of Unicorp are located at 302 N.
5th Street, Orange, Texas 77630-5707 and its telephone
number is (409) 886-7424. For additional information
concerning the business of Unicorp and its financial
condition, see "CERTAIN INFORMATION CONCERNING UNICORP",
"MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS OF UNICORP" and "UNICORP
CONSOLIDATED FINANCIAL INFORMATION."
<PAGE>
Selected Financial Data of Unicorp
The following selected financial information of Unicorp with respect to
each year in the five-year period ended December 31, 1996 and the six-month
periods ended June 30, 1997 and 1996 has been derived from the consolidated
financial statements of Unicorp. The information set forth below should
be read in conjunction with Unicorp's financial statements, the notes
thereto, and Unicorp's Management's Discussion and Analysis of Financial
Condition and Results of Operations for the years ended December 31, 1996 and
1995 and the six-month periods ended June 30, 1997 and 1996 appearing elsewhere
in this Proxy Statement - Prospectus.
<TABLE>
<CAPTION>
UNICORP BANCSHARES - TEXAS, INC.
SELECTED FINANCIAL INFORMATION
Year Ended December 31 6 Months Ended June 30
- ------------------------------------------------------------------------------------------------------------------------------
Unaudited ($ in thousands, except per share amounts)
1996 1995 1994 1993 1992 1997 1996
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Net interest income ................ $ 5,313 $ 4,007 $ 3,628 $ 3,210 $ 3,282 $ 3,028 $ 2,279
Income from continuing operations .. 2,101 1,714 1,323 1,373 1,158 1,003 852
Per common share:
Income from continuing operations 1.51 1.23 0.95 0.98 0.83 0.72 0.61
Cash dividends .................. 0.60 0.84 0.56 0.69 0.80 0.30 0.30
Book value ...................... 5.56 4.66 3.79 3.73 3.43 5.94 4.86
SELECTED PERIOD-END BALANCES
Debt ............................... 3,311 - - - - 3,115 3,500
Total assets ....................... 117,533 78,185 75,818 67,216 57,871 115,345 117,193
</TABLE>
<TABLE>
<CAPTION>
UNICORP BANCSHARES-TEXAS, INC.
QUARTERLY INCOME RESULTS
- ------------------------------------------------------------------------------------------------------------
Unaudited ($ in thousands, except per share amounts)
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------
3/31/97 6/30/97
- -----------------------------------------------------------------
Interest income .... $2,212 $2,234
Net interest income 1,500 1,528
Net income ......... 501 502
Net income per share 0.36 0.36
- ------------------------------------------------------------------------------------------------------------
3/31/96 6/30/96 9/30/96 12/31/96
- ------------------------------------------------------------------------------------------------------------
Interest income .... $1,523 $1,737 $2,219 $2,196
Net interest income 1,073 1,206 1,501 1,533
Net income ......... 410 442 592 657
Net income per share 0.29 0.32 0.42 0.47
- ------------------------------------------------------------------------------------------------------------
3/31/95 6/30/95 9/30/95 12/31/95
- ------------------------------------------------------------------------------------------------------------
Interest income .... $1,386 $1,448 $1,447 $1,484
Net interest income 964 1,000 1,006 1,037
Net income ......... 517 373 393 431
Net income per share 0.37 0.27 0.28 0.31
</TABLE>
<PAGE>
Pro Forma Combined Selected Financial Data (Unaudited)
The following table sets forth certain unaudited pro forma combined
selected financial information for Hibernia, after giving effect to the merger
with Unicorp. The pro forma information, which reflects the Merger using the
pooling-of-interests method of accounting, is presented for informational
purposes only and should not be construed as indicative of the actual operations
that would have occurred had the Merger been consummated at the beginning of the
periods indicated or that may be obtained in the future.
See "Pro Forma Financial Information" contained elsewhere herein.
<TABLE>
<CAPTION>
PRO FORMA HIBERNIA CORPORATION*
PRO FORMA COMBINED SELECTED FINANCIAL INFORMATION
Year Ended December 31 6 Months Ended June 30
- --------------------------------------------------------------------------------------------------------------------------
Unaudited ($ in thousands, except per share amounts)
1996 1995 1994 1997 1996
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net interest income ................ $ 371,530 $ 324,763 $ 304,744 $ 206,151 $ 177,473
Income from continuing operations .. 112,051 130,599 102,783 64,552 55,297
Per common share:
Income from continuing operations 0.86 1.01 0.79 0.47 0.43
Cash dividends .................. 0.29 0.25 0.19 0.16 0.14
Book value ...................... 6.52 6.02 4.94 6.79 6.12
SELECTED PERIOD-END BALANCES
Debt ............................... 54,660 34,361 21,012 7,028 30,342
Total assets ....................... 9,424,329 7,833,904 7,370,287 9,785,478 7,972,414
- ---------------
* Includes Hibernia Corporation and Unicorp Bancshares - Texas, Inc.
</TABLE>
<PAGE>
Comparative Per Share Information (Unaudited)
The following table sets forth for Hibernia Common Stock and Unicorp
Common Stock certain unaudited pro forma combined and unaudited pro forma
equivalent per share financial information for the six-month periods ended June
30, 1997 and 1996 and for the years ended December 31, 1996, 1995 and 1994.
Information under the column titled "Hibernia Corporation" is based on (i)
Hibernia's Annual Report on Form 10-K for the year ended December 31, 1996 and
(ii) Hibernia's Quarterly Report on Form 10-Q for the six-month period ended
June 30, 1997. Information under the column titled "Unicorp Bancshares - Texas,
Inc." is based on, and should be read in conjunction with, the historical
financial statements and related notes and Management's Discussion and Analysis
of Financial Condition and Results of Operations of Unicorp contained elsewhere
in this Proxy Statement - Prospectus.
Information under the column entitled "Pro Forma Hibernia Corporation
(with Unicorp Bancshares - Texas, Inc.)" is based upon the pro forma financial
statements and related notes contained elsewhere herein. Such pro forma combined
information, which reflects the Merger, is presented for informational purposes
only and should not be construed as indicative of the actual operations that
would have occurred had the Merger been consummated at the beginning of the
periods indicated or that may be obtained in the future. The pro forma combined
information gives effect to the issuance, in each of the periods presented, of
1.6 shares of Hibernia Common Stock for each outstanding share of Unicorp Common
Stock. The pro forma combined information assumes the Average Market Price of
Hibernia Common Stock will be $16.75 per share. See "PROPOSED MERGER -- Terms of
the Merger."
The information under the column entitled "Unicorp Bancshares - Texas,
Inc. Pro Forma Equivalent" is derived by multiplying the amounts contained in
the column titled "Pro Forma Hibernia Corporation (with Unicorp Bancshares -
Texas, Inc.)" by the Exchange Rate (as defined in the Merger Agreement) of 1.6.
See "PROPOSED MERGER -- Terms of the Merger."
<TABLE>
<CAPTION>
HIBERNIA CORPORATION AND UNICORP BANCSHARES - TEXAS, INC.
COMPARATIVE PER SHARE INFORMATION
- --------------------------------------------------------------------------------
Unaudited
PRO FORMA
HIBERNIA UNICORP
CORPORATION BANCSHARES -
UNICORP (WITH UNICORP TEXAS, INC.
HIBERNIA BANCSHARES- BANCSHARES - PRO FORMA
CORPORATION TEXAS, INC. TEXAS, INC.) EQUIVALENT
- --------------------------------------------------------------------------------
Per Common Share:
<S> <C> <C> <C> <C>
Income from continuing operations:
For the six months ended June 30,
1997 $ 0.47 $ 0.72 $ 0.47 $ 0.75
1996 0.43 0.61 0.43 $ 0.69
For the year ended December 31,
1996 $ 0.85 $ 1.51 $ 0.86 $ 1.38
1995 1.02 1.23 1.01 $ 1.62
1994 0.80 0.95 0.79 $ 1.26
Cash dividends:
For the six months ended June 30,
1997 $ 0.16 $ 0.30 $ 0.16 $ 0.26
1996 0.14 0.30 0.14 $ 0.22
For the year ended December 31,
1996 $ 0.29 $ 0.60 $ 0.29 $ 0.46
1995 0.25 0.84 0.25 $ 0.40
1994 0.19 0.56 0.19 $ 0.30
Book Value:
At June 30, 1997 ... $ 6.84 $ 5.94 $ 6.79 $ 10.86
At December 31, 1996 6.58 5.56 6.52 $ 10.43
</TABLE>
SUMMARY
This summary is necessarily general and abbreviated and
has been prepared to assist shareholders of Unicorp in their
review of this Proxy Statement-Prospectus. This summary is
not intended to be a complete explanation of the matters
covered in this Proxy Statement-Prospectus and is qualified
in its entirety by reference to the more detailed
information contained elsewhere in this Proxy Statement-
Prospectus, the Appendices hereto and the documents
incorporated herein by reference. Shareholders of Unicorp
are urged to read all of those documents in their entirety
prior to the Special Meeting.
The Proposed Merger
The shareholders of Unicorp will consider and vote upon
the Agreement and the Merger at the Special Meeting. If the
shareholders of Unicorp approve the Agreement and the Merger
and the other conditions to completing the Merger are
satisfied (see "PROPOSED MERGER -- Representations and
Warranties; Conditions to the Merger; Waiver"), the Merger
will be consummated on a date thereafter chosen by the
parties (the "Effective Date"). Shareholders of Unicorp,
other than shareholders of Unicorp who exercise and perfect
dissenters' rights under Texas law, will receive 1.6 shares
of Hibernia Common Stock in exchange for each share of
Unicorp Common Stock they own (the "Exchange Rate").
Unicorp shareholders will also be paid cash in lieu of any
fractional share of Hibernia Common Stock to which they may
otherwise be entitled.
Management and Operations After the Merger
Unicorp, UB-Delaware and the Bank will cease to exist
after the Merger. The business of the Bank will be
conducted through HNBT after the merger. The Boards of
Directors of Hibernia and HNBT following the Merger will
consist of those persons serving as directors immediately
prior to the Merger.
Recommendation of the Board of Directors
THE BOARD OF DIRECTORS OF UNICORP ("UNICORP BOARD") HAS
UNANIMOUSLY APPROVED THE AGREEMENT AND THE MERGER, BELIEVES
THAT THE MERGER IS IN THE BEST INTERESTS OF THE SHAREHOLDERS
OF UNICORP AND RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR THE
MERGER AND THE RELATED AGREEMENT. (See "MEETING
INFORMATION.") The Unicorp Board has received from First
Capital Group, L.L.C. (the "Advisor") an opinion that the
consideration to be received by the holders of Unicorp
Common Stock in connection with the Merger is fair, from a
financial point of view, to the shareholders of Unicorp.
See "PROPOSED MERGER-- Opinion of Financial Advisor."
The Unicorp Board believes that the Merger will provide
significant value to all Unicorp shareholders. In
recommending the Merger to the shareholders, the Unicorp
Board considered, among other factors, the financial terms
of the Merger, the liquidity it will afford Unicorp's
shareholders and the business earnings and potential for
future growth of Unicorp and Hibernia. 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 Unicorp
Board in approving the terms of the Merger, including,
without limitation, information concerning the financial
condition, results of operations and prospects of Hibernia,
Unicorp, HNB, HNBT, and the Bank; the ability of Unicorp to
compete in its relevant banking markets and to face
additional competitive pressures due to changes in the
regulatory environment; the market price of Hibernia Common
Stock; the absence of an active trading market for Unicorp
Common Stock; the consideration to be received by Unicorp
shareholders in relation to Unicorp's earnings and book
value; the anticipated tax-free nature of the Merger to
Unicorp's shareholders for federal income tax purposes; and
the financial terms of other recent business combinations in
the banking industry. See "PROPOSED MERGER -- Background of
and Reasons for the Merger."
Advice and Opinion of Financial Advisor
The Advisor has rendered an opinion to Unicorp that,
based on and subject to the procedures, matters and
limitations described in its opinion and such other matters
as it considered relevant, as of the date of its opinion,
the consideration to be received by the holders of Unicorp
Common Stock in connection with the Merger is fair, from a
financial point of view, to the shareholders of Unicorp.
The Advisor's opinion is attached as Appendix B to this
Proxy Statement-Prospectus. Shareholders are urged to read
the opinion in its entirety for a description of the
procedures followed, matters considered, and limitations
on the reviews undertaken in connection therewith. See
"PROPOSED MERGER -- Opinion of Financial Advisor."
Votes Required
Approval of the Merger requires the affirmative vote of
the holders of two-thirds of the issued and outstanding
shares of Unicorp Common Stock, in person or by proxy, at
the Special Meeting. (See "MEETING INFORMATION.") The
Unicorp Board has fixed the close of business on _______ __,
1997 as the record date (the "Record Date") for determining
the shareholders entitled to receive notice of, and to vote
at, the Special Meeting. Directors and executive officers
of Unicorp and certain members of their families from whom
Hibernia has received commitments to vote in favor of the
Merger own 1,063,185 shares of Unicorp Common Stock,
representing 76.17% of the Unicorp Common Stock issued and
outstanding as of the Record Date. See "CERTAIN INFORMATION
CONCERNING UNICORP -- Ownership of Management." Subject to
the fairness opinion from the Advisor having not been
withdrawn, the holders of those shares have agreed to vote
the stock for which they have voting power in favor of
approval of the Merger and the Agreement at any meeting of
Unicorp's shareholders held before March 31, 1998 at which
the Merger is considered, unless the fairness opinion from
the Advisor is withdrawn or they are legally required to
abstain from voting or to vote against the Merger and the
Agreement in order to fulfill their fiduciary duties in the
opinion of their counsel. In the absence of those
circumstances, approval of the Merger and the Agreement is
assured. See "MEETING INFORMATION" and "CERTAIN INFORMATION
CONCERNING UNICORP -- Ownership of Management." Approval of
the Merger by shareholders of Hibernia is not required under
the laws of the State of Louisiana.
Conditions; Abandonment; Amendment
Consummation of the Merger is subject to the
satisfaction of a number of conditions, including, among
others, approval of the Agreement by the required vote of
the shareholders of Unicorp , approval of the proposed
transaction by the Board of Governors of the Federal Reserve
System ("Federal Reserve Board"), and the exercise and
perfection of dissenters' rights pursuant to Texas law by
shareholders of Unicorp holding in the aggregate no more
than 10% of the Unicorp Common Stock outstanding on the
Closing Date. Applicable law provides that the Merger may
not be consummated until at least 15, and the Federal
Reserve Board requires that the Merger be consummated no
more than 90, days after approval of the Federal Reserve
Board is obtained. See "PROPOSED MERGER -- Representations
and Warranties; Conditions to the Merger; Waiver" and
"PROPOSED MERGER -- Regulatory and Other Approvals."
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 Unicorp's
shareholders may reduce the ratio of Hibernia Common Stock
to Unicorp Common Stock to be issued in the Merger (the
"Exchange Rate"). Any other material change to the
Agreement after the date of the Special Meeting would
require, however, a resolicitation of Unicorp's shareholders
for the purpose of voting on the transaction as amended. In
addition, the Agreement may be terminated, either before or
after shareholder approval, under certain circumstances.
See "PROPOSED MERGER -- Representations and Warranties;
Conditions to the Merger; Waiver" and "PROPOSED MERGER --
Effective Date of the Merger; Termination."
Interests of Certain Persons in the Merger
The executive officers of Unicorp and members of the
Unicorp Board have interests in the Merger that are in
addition to their interests as shareholders of Unicorp.
These benefits include, among others, the continuation of
certain employee benefits generally, provisions in the
Agreement relating to the indemnification of officers,
directors and employees of Unicorp for certain liabilities
up to certain aggregate limitations and payments to be
received by executive officers pursuant to agreements with
Unicorp. See "PROPOSED MERGER -- Employee Benefits" and --
"Interests of Certain Persons in the Merger."
Employee Benefits
Hibernia has agreed as part of the Agreement that it
will offer to all former employees of Unicorp and/or the
Bank who become employees of Hibernia or its subsidiaries
the same employee benefits as those offered by Hibernia,
HNB, and HNBT to their employees, except that former
employees of Unicorp will not be required to wait for any
period in order to be eligible to participate in Hibernia's
flexible benefits plan (including its medical and dental
coverage). Hibernia will also give Unicorp employees full
credit for their years of service (for both eligibility and
vesting) with Unicorp for purposes of Hibernia's 401(k)
plan, the Retirement Security Plan and Hibernia's Employee
Stock Ownership Plan ("ESOP") to the extent permitted under
the terms of those plans. Hibernia has also agreed to pay
or provide certain other benefits. See "PROPOSED MERGER---
Employee Benefits."
Material Tax Consequences
It is a condition to consummation of the Merger that
the parties receive an opinion of counsel of a nationally
recognized public accounting firm to the effect that (i) the
Merger, when consummated in accordance with the terms of the
Merger Agreement, will constitute a reorganization within
the meaning of Section 368(a) of the Internal Revenue Code
of 1986, as amended (the "Code"), (ii) the exchange of
Unicorp Common Stock, to the extent exchanged for Hibernia
Common Stock, will not give rise to a gain or loss to the
shareholders of Unicorp with respect to such exchange, (iii)
the basis of Hibernia Common Stock to be received by the
holders of Unicorp Common Stock will be, in each instance,
the same as the basis of their stock surrendered in exchange
therefor, decreased by the amount of cash received, if any,
and increased by the amount of gain, if any, recognized in
the exchange, and (iv) the holding period of the Hibernia
Common Stock to be received by the holders of Unicorp Common
Stock in the transaction will include in each instance the
period during which the Unicorp Common Stock surrendered in
exchange therefor is held as a capital asset on the date of
surrender. The parties have received an opinion from Ernst
& Young LLP, certified public accountants, who serve as
independent auditors for Hibernia, to these effects. A copy
of such opinion is attached hereto as Appendix D. See
"PROPOSED MERGER -- Material Tax Consequences."
Because of the complexities of the 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 Unicorp consult his, her, or its
tax advisor concerning the federal (and any applicable
state, local or other) tax consequences of the Merger to
him, her or it.
Dissenters' Rights
Each holder of Unicorp Common Stock who objects to the
Merger and perfects his or her rights to dissent from the
Merger in accordance with the Texas Business Corporation Act
("TBCA") is entitled to the rights and remedies of
dissenting shareholders provided in the TBCA, Articles 5.11,
5.12, and 5.13, copies of which are attached hereto as
Appendix C. However, if dissenters' rights are exercised
and perfected with respect to 10% or more of the outstanding
shares of Unicorp Common Stock, Hibernia may abandon the
Merger. In addition, dissenting shareholders may receive
value for their shares that is more or less than, or equal
to, the value received by other shareholders in the Merger.
See "PROPOSED MERGER -- Rights of Dissenting Shareholders."
Differences in Shareholders' Rights
Shareholders of Unicorp, 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 By-Laws
and the laws of the State of Louisiana. The rights of
shareholders of Hibernia are different in certain respects
from the rights of shareholders of Unicorp. 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 Unicorp Common Stock exercise and
perfect dissenters' rights, the Merger will not qualify for
pooling-of-interests accounting treatment, and Hibernia will
not be obligated to complete the Merger. See "PROPOSED
MERGER -- Accounting Treatment."
Other Pending Merger Transactions for Hibernia
On May 12, 1997, Hibernia announced a definitive
agreement to merge with Executive Bancshares, Inc.
("Executive") and its wholly-owned subsidiaries, The First
National Bank of Paris and Collin County National Bank. As
of June 30, 1997, Executive had total consolidated assets of
$138 million and shareholders' equity of $8 million. On
June 26, 1997, Hibernia announced a definitive agreement to
merge with Northwest Bancshares of Louisiana, Inc.
("Northwest") and its wholly owned subsidiary, First
National Bank in Mansfield. As of June 30, 1997, Northwest
had total consolidated assets of $105 million and
shareholders' equity of $12 million. Also, on July 16,
1997, Hibernia announced a definitive agreement to merge
with ArgentBank. As of June 30, 1997, ArgentBank reported
total consolidated assets of $760 million and shareholders'
equity of $81.3 million. Hibernia expects to issue a
maximum of approximately 16.6 million shares of its Common
Stock in the aggregate in these three mergers, each of which
Hibernia expects to account for as poolings of interests.
Shareholders of Unicorp will not be entitled to vote on any
of the mergers with Executive, Northwest, or ArgentBank.
The mergers with Executive, Northwest, and ArgentBank, if
completed, will not have a material impact on Hibernia's
assets, liabilities, financial condition or results of
operations. The mergers with Executive, Northwest, and
ArgentBank are subject to terms and conditions similar or
identical to those applicable to the Merger and may be
completed or abandoned before or after completion of the
Merger.
MEETING INFORMATION
This Proxy Statement-Prospectus is furnished in
connection with the solicitation of proxies by the Unicorp
Board for use at the Special Meeting. Each copy of this
Proxy Statement-Prospectus mailed to holders of Unicorp
Common Stock is accompanied by a proxy card furnished in
connection with the Unicorp Board's solicitation of proxies
for use at the Special Meeting and at any adjournment
thereof. The Special Meeting is scheduled to be held at
_____ a.m., Central daylight time, on _________, ________
__, 1997, at the main office of Unicorp (which is the main
office of the Bank), 302 N. 5th Street, Orange, Texas. Only
holders of record of Unicorp 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 the Merger, and (b)
such other matters as may properly be brought before the
Special Meeting or any adjournment thereof.
HOLDERS OF UNICORP COMMON STOCK ARE REQUESTED TO COMPLETE,
DATE AND SIGN THE ACCOMPANYING PROXY CARD AND RETURN IT
PROMPTLY IN THE ENCLOSED, POSTAGE PAID ENVELOPE.
Solicitation and Revocation of Proxies
Any holder of Unicorp 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 to the Secretary of Unicorp
prior to the date of the Special Meeting or submitting a
signed proxy card bearing a later date before the Special
Meeting. The shares of Unicorp 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
contrary instructions are not given on a proxy card, such
executed proxy cards received by Unicorp will be voted FOR
approval of the Agreement and the Merger. 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 Unicorp
Board is unaware of any matter to be presented at the
Special Meeting other than the proposal to approve the
Merger and the Agreement.
The cost of soliciting proxies from shareholders of
Unicorp, including expenses incurred in preparing,
assembling and mailing this Proxy Statement-Prospectus, will
be borne by Unicorp, except that Hibernia will bear all
expenses incurred in printing this Proxy Statement-
Prospectus. Such solicitation will be made by mail but also
may be made by telephone or other means of
telecommunications or in person by the directors, officers
and employees of Unicorp (who will receive no additional
compensation for doing so).
UNICORP 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 COMPLETED.
Vote Required
Approval of the Agreement requires the affirmative vote
of the holders of two-thirds of the issued and outstanding
shares of Unicorp Common Stock, in person or by proxy, at
the Special Meeting. The Unicorp Board has fixed the close
of business on _______ __, 1997, as the Record Date for the
determination of shareholders entitled to notice of and to
vote at the Special Meeting. As of the Record Date, there
were 1,395,868 shares of Unicorp 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 of Unicorp Common
Stock constitutes a quorum for purposes of the Special
Meeting. An abstention will be considered present for
quorum purposes, but will have the same effect as a vote
against the proposal to be considered at the Special
Meeting. A broker non-vote will not count for quorum or
voting purposes because brokers will not have discretionary
authority to vote with respect to the proposal and,
therefore, a broker non-vote will have no effect on the vote
on the proposal.
As of the Record Date, the directors and executive
officers of Unicorp and certain members of their families
beneficially owned a total of 1,063,185 shares, or
approximately 76.17% of the outstanding shares, of Unicorp
Common Stock. The holders of these shares have agreed to
vote the stock in favor of the Merger and the related
Agreement, unless the fairness opinion from the Advisor
is withdrawn or they are legally required to abstain from
voting or to vote against the Merger and the Agreement in
order to fulfill their fiduciary duties in the opinion of
their counsel. Consequently, in the absence of such
circumstances, approval of the Merger and the Agreement is
assured.
Recommendation
For the reasons described below, the Unicorp Board has
unanimously approved the Agreement, believes the Merger is
in the best interests of Unicorp and its shareholders and
recommends that holders of Unicorp Common Stock vote FOR
approval of the Agreement and Merger. In making its
recommendation to shareholders, the Unicorp Board
considered, among other things, the opinion of the Advisor
that the consideration to be received by the holders of
Unicorp Common Stock pursuant to the Merger is fair to such
shareholders from a financial point of view. See
"Background of and Reasons for the Merger" and "Opinion of
Financial Advisor" under "PROPOSED MERGER", below.
PROPOSED MERGER
This section of the Proxy Statement-Prospectus
describes certain aspects of the Merger. 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-Prospectus
and is incorporated herein by reference. All shareholders
are urged to read the Agreement carefully and in its
entirety.
General
If the shareholders of Unicorp approve the Agreement
and the Merger and the other conditions to the consummation
of the Merger are satisfied, Unicorp will be merged with and
into Hibernia. At that time, the separate existence of
Unicorp will cease. UB-Delaware will also be merged with
and into Hibernia, and its separate existence will cease at
that time. Simultaneously with the Merger and the Merger of
UB-Delaware into Hibernia, the Bank will be merged into
HNBT, and the separate existence of the Bank will also
cease. As soon as practicable following the Effective Date,
the operations previously conducted by the Bank will be
conducted under the name of HNBT.
In the Merger, Hibernia will exchange 1.6 shares of
Hibernia Common Stock, plus cash in lieu of any fractional
shares, for each outstanding share of Unicorp Common Stock
as to which dissenters' rights have not been exercised and
perfected. Each share of Hibernia Common Stock outstanding
immediately prior to the effective date of the Merger will
remain outstanding and unchanged as a result of the Merger.
Background of and Reasons for the Merger
Background. Since the early 1990's, Unicorp has
periodically received expressions of interest as to the
potential acquisition of or merger with Unicorp. Although
such expressions of interest have been entertained by the
Unicorp Board, in each instance the Unicorp Board has
determined that the acquisition value or other terms of the
proposed transactions were not satisfactory. Nevertheless,
the Unicorp Board has remained willing to explore the
various strategic alternatives available to Unicorp,
including (i) a strategy of independence, focusing on
efficiencies and internal growth, (ii) growth by acquisition
of other institutions, and (iii) a sale of Unicorp.
At the suggestion of management, in late January
1997, Unicorp engaged Service Asset Management Company to
assist in evaluating the market for Unicorp, locating
potential parties interested in acquiring Unicorp and
evaluating expressions of interest from such parties. Prior
to the distribution of any marketing materials with respect
to Unicorp, however, in late March 1997, representatives of
First Capital Group, L.L.C. ("FCG") approached management of
Unicorp as to whether Unicorp had any interest in a sale or
merger. After initial discussions with FCG as to the terms
of a proposed sale, on April 10, 1997, management of Unicorp
met with management of Hibernia, on whose behalf FCG had
been engaged. An offer was submitted by Hibernia by letter
dated April 16, 1997, which was accepted in principle
subject to the preparation and execution of a definitive
agreement acceptable to both parties. The resulting
Agreement was executed as of May 28, 1997.
Reasons for the Merger. The terms of the Agreement,
including the Exchange Rate, are the result of arms-length
negotiations between Hibernia and Unicorp and their
respective representatives. The Unicorp Board believes that
the Merger is fair and in the best interests of its
shareholders. In reaching that decision, the Unicorp Board
consulted with its financial and other advisors, as well as
with Unicorp's management, and considered a number of
factors, including, but not limited to, the following:
(a) the financial condition and results of operations
of, and prospects for, each of Hibernia and Unicorp;
(b) the financial terms of the Merger, including the
amount and type of consideration to be received by Unicorp's
shareholders pursuant to the Agreement;
(c) the Hibernia Common Stock to be received by
holders of Unicorp Common Stock pursuant to the Agreement
will be listed for trading on the NYSE and will provide
liquidity that is unavailable to holders of Unicorp Common
Stock, for which an active trading market does not exist;
(d) the Agreement will allow holders of Unicorp Common
Stock to become shareholders of Hibernia, an institution
which was, as of June 30, 1997, the second largest bank
holding company headquartered in Louisiana;
(e) the recent changes in the regulatory environment,
which likely will result in Unicorp facing additional
competitive pressures in its market area from other
financial institutions with greater financial resources
capable of offering a broad array of financial services;
(f) the Merger is expected to qualify as a tax-free
reorganization so that neither Unicorp nor the holders of
Unicorp Common Stock (except to the extent that cash is
received in lieu of a fractional share of Hibernia Common
Stock) will recognize any gain in the transaction (see
"Material Tax Consequences"); and
(g) the opinion received from the Advisor that the
consideration to be received by the holders of Unicorp
Common Stock pursuant to the Agreement is fair to such
shareholders from a financial point of view (as of the date
of such opinion) (see "Opinion of Financial Advisor").
The Unicorp Board did not assign any specific or
relative weight to the foregoing factors in its
considerations. The Unicorp Board believes that the
Agreement and the Merger will provide significant value to
all Unicorp shareholders.
Based on the foregoing, the Unicorp Board has
unanimously approved the Agreement and the Merger, believes
that the Agreement and the Merger are in the best interests
of Unicorp's shareholders, and recommends that all holders
of Unicorp Common Stock vote "FOR" the approval of the
Agreement and the Merger.
Terms of the Merger
If the shareholders of Unicorp approve the Agreement
and the Merger and the other conditions to the consummation
of the Merger are satisfied (see "PROPOSED MERGER--
Representations and Warranties; Conditions to the Merger;
Waiver"), the Merger will be consummated on the Effective
Date. Unicorp shareholders who do not exercise and perfect
dissenters' rights will receive 1.6 shares of Hibernia
Common Stock for each share of Unicorp Common Stock they
own. Also, each shareholder of Unicorp who would be
entitled to receive a fraction of a share of Hibernia Common
Stock will receive (without interest) an amount in cash
equal to such part of a fractional share multiplied by the
Average Market Price of Hibernia Common Stock instead of a
fractional share. For this purpose, the Average Market
Price of Hibernia Common Stock is the average of the closing
price of one share of Hibernia Common Stock for the ten
business days preceding the last trading day immediately
prior to the Closing Date (as reported in The Wall Street
Journal).
On the Effective Date of the Merger, each share of
Unicorp Common Stock, other than shares held by shareholders
who exercise and perfect dissenters' rights in accordance
with Texas law and shares owned beneficially by Hibernia or
its subsidiaries, will automatically convert to the number
of shares of Hibernia Common Stock described above. Unicorp
shareholders will automatically be entitled to all of the
rights and privileges afforded to Hibernia shareholders as
of that date. However, the exchange of Unicorp stock
certificates for certificates representing Hibernia Common
Stock will occur after the Closing Date.
SHAREHOLDERS OF UNICORP SHOULD NOT FORWARD THEIR STOCK
CERTIFICATES TO UNICORP OR HIBERNIA AT THIS TIME. IF THE
MERGER IS CONSUMMATED, UNICORP'S SHAREHOLDERS WILL RECEIVE
INSTRUCTIONS REGARDING THE EXCHANGE OF THEIR CERTIFICATES
FOR HIBERNIA COMMON STOCK.
For a discussion of the rights of dissenting
shareholders, see "PROPOSED MERGER -- Rights of Dissenting
Shareholders."
Opinion of Financial Advisor
General. Unicorp retained the Advisor to act as its
financial advisor in connection with the Merger and related
matters based upon its qualifications, expertise and
reputation (the "Opinion"). On August 14, 1997, the Advisor
rendered its written opinion to the Board that the
consideration to be received pursuant to the Agreement is
fair from a financial point of view to the holders of
Unicorp Common Stock.
THE FULL TEXT OF THE OPINION WHICH SETS FORTH,
AMONG OTHER THINGS, ASSUMPTIONS MADE, PROCEDURES FOLLOWED,
MATTERS CONSIDERED, AND LIMITATIONS ON THE REVIEW UNDERTAKEN,
IS ATTACHED AS APPENDIX B TO THIS PROXY STATEMENT-PROSPECTUS.
UNICORP'S SHAREHOLDERS ARE URGED TO READ THE OPINION CAREFULLY
AND IN ITS ENTIRETY. THE OPINION DOES NOT CONSTITUTE A
RECOMMENDATION TO ANY SHAREHOLDER OF UNICORP AS TO HOW SUCH
SHAREHOLDER SHOULD VOTE AT THE SPECIAL MEETING.
In connection with rendering its Opinion, the Advisor,
among other things: (i) analyzed certain internal financial
statements and other financial and operating data concerning
Unicorp prepared by the management of Unicorp; (ii) analyzed
certain publicly available financial statements, both audited
and unaudited, and other information of Unicorp and Hibernia,
including those included in Unicorp's financial statements for
the period ended December 31, 1996, Hibernia's Annual Reports
for the three years ended December 31, 1996, Hibernia's
Quarterly Reports for the periods ended March 31, and June
30, 1997, and Unicorp's financial statements for the
quarters ended March 31, and June 30, 1997; (iii) analyzed
certain financial projections of Unicorp prepared by the
management of Unicorp; (iv) discussed the past and current
operations and financial condition of Unicorp with senior
executives of Unicorp; (v) reviewed the reported stock
prices and trading activity for Hibernia Common Stock; (vi)
compared the financial performance of Hibernia Common Stock
and trading activity with that of certain other comparable
publicly-traded companies and their securities; (vii)
reviewed and compared certain security analysis reports of
Hibernia's common stock prepared by various investment
banking firms; (viii) reviewed the financial terms, to the
extent publicly available, of certain comparable precedent
transactions; (ix) reviewed the Agreement; and (x) performed
such other analyses as deemed appropriate.
In connection with its review, the Advisor relied upon
and assumed the accuracy and completeness of all of the
foregoing information provided to it or made publicly
available, and the Advisor has not assumed any
responsibility for independent verification of such
information. With respect to the financial projections, the
Advisor assumed that they have been reasonably prepared on
the basis reflecting the best currently available estimates
and judgments of the future financial performance of
Unicorp. The Advisor has not made any independent valuation
or appraisal of the assets or liabilities of Unicorp, nor
has the Advisor been furnished with any such appraisals, and
the Advisor has not examined any individual loan files of
Unicorp. With respect to Hibernia, the Advisor relied
solely upon publicly available data and did not conduct
discussions with the management of Hibernia regarding
Hibernia's financial condition, performance, and prospects.
The Advisor did not conduct any independent evaluation or
appraisal of the assets, liabilities or business prospects
of Hibernia, was not furnished with any evaluations or
appraisals, and did not review any individual credit files.
The Advisor is not an expert in the evaluation of loan
portfolios for the purposes of assessing the adequacy of the
allowance for losses with respect thereto and has assumed
that such allowances for each of the companies are, in the
aggregate, adequate to cover such losses. The Advisor's
opinion is necessarily based on economic, market and other
conditions as in effect on, and the information made
available to the Advisor as of, the date of the opinion.
In connection with rendering its opinion, the Advisor
performed a variety of financial analyses. The preparation
of a fairness opinion involves various determinations as to
the most appropriate and relevant methods of financial
analysis and the application of those methods to the
particular circumstances and, therefore, such an opinion is
not readily susceptible to partial analysis of summary
description. Moreover, the evaluation of the fairness, from
a financial point of view, of the Exchange Rate to the
holders of Unicorp Common Stock was to some extent a
subjective one based on the experience and judgment of the
Advisor and not merely the result of mathematical analysis
of financial data. Accordingly, notwithstanding the
separate factors summarized below, the Advisor believes that
its analyses must be considered as a whole and that
selecting portions of its analyses and of the factors
considered by it, without considering all analyses and
factors, could create an incomplete view of the evaluation
process underlying its opinion. The ranges of valuations
resulting from any particular analysis described below
should not be taken to be the Advisor's view of the actual
value of Unicorp.
In performing its analyses, the Advisor made numerous
assumptions with respect to industry performance, business
and economic conditions and other matters, many of which are
beyond the control of Unicorp. The analyses performed by
the Advisor are not necessarily indicative of actual values
or future results, which may be significantly more or less
favorable than suggested by such analyses. The analyses do
not purport to be appraisals or to reflect the prices at
which a company might actually be sold. In addition, the
Advisor's analyses should not be viewed as determinative of
the opinion of the Unicorp Board or Unicorp's management
with respect to the value of Unicorp.
The following is a summary of the analyses performed by
the Advisor in connection with its Opinion:
Analysis of Selected Transactions. The Advisor performed an
analysis of premiums paid in selected pending or recently
completed acquisitions of banking organizations in Texas
with comparable characteristics to the Merger. The
comparable transactions were comprised to reflect
transactions where the seller possessed similar asset size,
regional location and form of consideration. The comparable
transactions specifically consisted of 13 mergers and
acquisitions of banking organizations in Texas from January
10, 1996 to August 12, 1997 with seller's total assets
ranging from $100 million to $200 million. Based on the
closing stock price of Hibernia Common Stock on May 28,
1997, and Unicorp's financial data as of March 31, 1997, the
analysis yielded ratios of the transactions' purchase price
as a multiple of: (i) equity ranging from 1.19 times to
3.12 times with an average of 1.86 times and a median of
1.78 times (compared with Unicorp's proposed transaction
with Hibernia of 2.51 times March 31, 1997 book value); (ii)
tangible equity ranging from 1.19 times to 3.12 times with
an average of 1.93 times and a median of 1.88 times
(compared with Unicorp's proposed transaction with Hibernia
of 3.28 times March 31, 1997 tangible book value); (iii)
trailing last 12 months earnings ranging from 7.57 times to
20.43 times with an average of 13.04 times and a median of
11.72 times (compared with Unicorp's proposed transaction
with Hibernia of 12.26 times last 12 months earnings as of
March 31, 1997, and 12.55 times June 30, 1997 annualized
earnings); and (iv) sellers' average and median equity to
asset ratio of 9.71% and 8.85%, respectively, compared to
9.37% for Unicorp.
Discounted Cash Flow Analysis. Using discounted cash flow
analysis, the Advisor estimated the present value of the
future stream of after-tax cash flow that Unicorp could
produce through the year 2002, under various circumstances,
assuming that Unicorp performed in accordance with the
earnings/return projections of management. The Advisor
utilized two separate terminal values for Unicorp at the end
of the period by applying multiples of earnings ranging from
14 times to 18 times and multiples of book ranging from 1.8
times to 2.2 times. The Advisor then discounted the cash
flow streams, dividends paid to the shareholders (assuming
all earnings in excess of that required to maintain the
current tangible equity to tangible asset ratio are paid out
in dividends) and terminal values using discount rates
ranging from 12.0% to 18.0% chosen to reflect different
assumptions regarding the required rates of return for
Unicorp and the inherent risk surrounding the underlying
projections. This discounted cash flow analysis indicated a
range of $16.90 per share to $25.90 per share utilizing
multiples of earnings as residual values and $10.58 per
share to $14.81 per share utilizing multiples of book value.
This compares favorably to the consideration to be paid to
Unicorp shareholders of: (i) $20.80 per share of Unicorp
Common Stock, based on a closing price of $13.00 per share
of Hibernia Common Stock on the date of announcement, May
28, 1997; and (ii) $23.20 per share of Unicorp Common Stock,
based on a closing price of $14.50 per share of Hibernia
Common Stock on August 12, 1997.
Comparable Company Analysis. The Advisor compared selected
balance sheet data, asset quality, capitalization and
profitability ratios and market statistics using financial
data at or for the twelve months ended March 31, 1997, and
market data as of August 12, 1997, for Hibernia to a group
of selected bank holding companies which the Advisor deemed
to be relevant, including Compass Bancshares, Inc., Deposit
Guaranty Corp., First American Corporation, First Commercial
Corp., First Commerce Corp., Trustmark Corporation, and
Union Planters Corporation, all being bank holding companies
in the Southeastern United States with assets between $5
billion and $15 billion, (collectively, the "Comparable
Composite"). This comparison, among other things, showed
that: (i) Hibernia's equity to asset ratio was 10.03%,
compared to an average of 8.58% and a median of 8.52% for
the Comparable Composite; (ii) for the twelve-month period
ended March 31, 1997, Hibernia's return on average assets
was 1.32%, compared to an average of 1.36% and a median of
1.36% for the Comparable Composite; (iii) for the twelve-
month period ended March 31, 1997, Hibernia's return on
average equity was 12.97%, compared to an average of 16.20%
and a median of 15.90% for the Comparable Composite; (iv) at
March 31, 1997, Hibernia's nonperforming loans to gross
loans ratio was 0.35%, compared to an average of 0.70% and a
median of 0.76% for the Comparable Composite; (v) at August
12, 1997, Hibernia's price per share to book value per share
at March 31, 1997, was 2.21 times, compared to an average of
2.57 times and median of 2.71 times for the Comparable
Composite; (vi) at August 12, 1997, Hibernia's price per
share to earnings per share at June 30, 1997, was 14.38
times, compared to an average of 15.38 times and median of
15.21 times for the Comparable Composite; and (vii) at March
31, 1997, Hibernia's dividend yield was 2.09%, compared to
an average of 2.54% and a median of 2.54% for the Comparable
Composite.
The Advisor also compared selected stock market results
of Hibernia to the publicly available corresponding data of
other composites which the Advisor deemed to be relevant,
including SNL's index of all publicly traded banks and the
S&P 500. Results from indexing the S&P 500, SNL's index of
all publicly traded banks, the Comparable Composite, and
Hibernia's stock from January 1, 1995 to August 12, 1997,
revealed similar relationships in pricing movements.
No company or transaction used in the comparable
company and comparable transaction analyses is identical to
Unicorp or the Merger. Accordingly, an analysis of the
results of the foregoing necessarily involves complex
considerations and judgments concerning differences in
financial and operating characteristics of Unicorp and other
factors that could affect the public trading value of the
companies to which they are being compared. Mathematical
analysis (such as determining the average or median) is not
in itself a meaningful method of using comparable
transaction data or comparable company data.
Pursuant to an engagement letter entered into in the
Spring of 1997, Hibernia agreed to pay a fee of $200,000 to
the Advisor as a finder's fee for introducing Hibernia to
Unicorp. The Advisor has agreed to provide the fairness
opinion to Unicorp for no additional fee.
As part of its investment banking business, the Advisor
is regularly engaged in the valuation of securities in
connection with mergers and acquisitions, private
placements, and valuations for estate, corporate and other
purposes. The Unicorp Board decided to retain the Advisor
based on its experience as a financial advisor in mergers
and acquisitions of financial institutions, and its
knowledge of financial institutions.
Closing Date and Effective Date of the Merger
Unless otherwise agreed upon by Hibernia and Unicorp,
and subject to the conditions to the obligations of the
parties to effect the Merger, the closing date will occur on
the first business day occurring after the last to occur of:
(i) October 2, 1997; (ii) the date that is 15 days after
approval of the Merger by the Federal Reserve Board; or
(iii) the date that is five days after the Special Meeting;
or such later date within 60 days of such date as may be
agreed upon by Hibernia and Unicorp. After all conditions
to consummation of the Merger have been satisfied or waived,
the effective date of the Merger ("the "Effective Date")
will be the date and time of the consummation of the Merger
evidenced by the issuance by the Louisiana Secretary of
State and Texas Secretary of State of certificates of merger
relating to the Merger. It is expected that the Effective
Date will occur on the same date or shortly after the
Closing Date, on a date chosen by the parties to the Merger.
No assurance can be provided that the necessary
shareholder and regulatory approvals can be obtained or the
other conditions precedent to the Merger can or will be
satisfied. Hibernia and Unicorp anticipate that all
conditions to consummation of the Merger will be satisfied
so that the Merger can be consummated in the third quarter
of 1997. However, delays in the consummation of the Merger
could occur.
The Board of Directors of either Hibernia or Unicorp
may terminate the Agreement if the Merger is not consummated
by March 31, 1998 or any condition to the consummation of
the Merger cannot be satisfied by March 31, 1998 and will
not be waived by the party or parties entitled to waive it.
See "PROPOSED MERGER -- Conditions to Consummation of the
Merger" and "PROPOSED MERGER --Waiver, Amendment, and
Termination of the Agreement."
Employee Benefits
Hibernia has agreed as part of the Agreement that it
will offer to all former employees of Unicorp and the Bank
who become employed by Hibernia or its subsidiaries as of
the Effective Date the same employee benefits as those
offered by Hibernia, HNB, and HNBT to their employees,
except that employees of Unicorp and the Bank will not be
required to wait for any period in order to be eligible to
participate in Hibernia's flexible plan (including its
medical and dental coverage). Hibernia will also give
Unicorp employees full credit for their years of service
(for both eligibility and vesting) with Unicorp for purposes
of Hibernia's 401(k) plan, the Retirement Security Plan, and
its ESOP (to the extent permitted under the terms of those
plans). If, however, Hibernia decides that it cannot merge
any benefit plan of Unicorp into a comparable benefit plan
of Hibernia, HNB, or HNBT without creating material
potential liability for Hibernia's, HNB's or HNBT's plans,
then Hibernia shall be entitled to freeze the existing
benefit plan of Unicorp and prohibit participation by former
employees of Unicorp in Hibernia's, HNB's or HNBT's plans
for the period of time required by applicable law to ensure
that Hibernia's, HNB's or HNBT's plans are not deemed to be
successor plans of the Unicorp plan in question.
Surrender and Exchange of Stock Certificates
Promptly after the Effective Date, Hibernia will cause
Chase Mellon Shareholder Services, acting in the capacity of
Exchange Agent, to mail to each non-dissenting shareholder
of Unicorp a letter of transmittal, together with
instructions for the exchange of such shareholder's
certificates representing shares of Unicorp Common Stock for
certificates representing shares of Hibernia Common Stock.
Until so exchanged, each certificate representing Unicorp
Common Stock outstanding immediately prior to the Effective
Date will 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.
UNICORP'S SHAREHOLDERS SHOULD NOT SEND IN THEIR STOCK
CERTIFICATES UNTIL THEY RECEIVE THE FORM LETTER OF
TRANSMITTAL AND INSTRUCTIONS. Upon surrender to the
Exchange Agent of certificates for Unicorp Common Stock,
together with a properly completed letter of transmittal,
there will be issued and mailed to each holder of Unicorp
Common Stock surrendering such items a certificate
representing the number of shares of Hibernia Common Stock
to which such holder is entitled as a result of the Merger
and a check representing cash paid in lieu of a fractional
share, if any. After the Effective Date, to the extent
permitted by law, holders of record of Unicorp Common Stock
as of the Effective Date will be entitled to vote at any
meeting of Hibernia's shareholders the number of shares of
Hibernia Common Stock into which their Unicorp Common Stock
has been converted regardless of whether such shareholders
have surrendered their stock certificates. NO DIVIDEND OR
OTHER DISTRIBUTION PAYABLE AFTER THE EFFECTIVE DATE WITH
RESPECT TO HIBERNIA COMMON STOCK, HOWEVER, WILL BE PAID TO
THE HOLDER OF ANY UNSURRENDERED UNICORP STOCK CERTIFICATE
UNTIL THE HOLDER DULY SURRENDERS SUCH CERTIFICATE. Upon
such surrender, all undelivered dividends and other
distributions will be delivered to such shareholder, in each
case without interest and less the amount of taxes, if any,
that may have been withheld, imposed or paid thereon.
Unicorp's shareholders who cannot locate their Unicorp
stock certificates are encouraged to contact Shirley Hall,
Secretary and Treasurer, 302 N. 5th Street, Orange, Texas
77630-5707, telephone: (409) 886-7424 prior to the Special
Meeting. New certificates will be issued to Unicorp
shareholders who have misplaced their certificates only if
the shareholder executes an affidavit certifying that the
certificate cannot be located and agreeing to indemnify
Unicorp and Hibernia (as its successor) against any claim
that may be made against either of them by the owner of the
lost certificate(s). Unicorp 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, as
applicable, if the Merger is approved and consummated.
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, provided that printing expenses will
be borne by Hibernia.
Representations and Warranties; Conditions to the Merger;
Waiver
The Agreement contains representations and warranties
by Unicorp 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, pending and threatened
litigation, contractual obligations and public reports.
Except as otherwise provided in the Agreement, these
representations and warranties will not survive the
Effective Date.
The obligations of Hibernia and Unicorp to consummate
the Merger are conditioned upon, among other things,
approval of the Agreement and Merger by Unicorp's
shareholders; the receipt of necessary regulatory approvals,
including the approval of the Federal Reserve Board; 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 of the Code, that Unicorp 's shareholders will
recognize no gain or loss for federal income tax purposes
with respect to such exchange and certain other tax-related
matters; 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 absence of litigation or
proceedings by a governmental agency seeking to prevent the
consummation of the Merger; 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; Hibernia and/or HNBT shall have
entered into an employment agreement with Carlos R. Vacek
(the President and a Director of Unicorp) having a term of
three years and other provisions mutually acceptable to
Hibernia and Mr. Vacek and an employment agreement with Lin
M. Bingham (the Chief Financial Officer and a Director of
Unicorp) having a term of two years and other provisions
mutually acceptable to Hibernia and Mr. Bingham; in the case
of Hibernia, the total amount of indebtedness of Unicorp
that would be reflected on a parent-only balance sheet of
Unicorp, prepared in accordance with generally accepted
accounting principles, shall not exceed $3,100,000; and in
the case of Unicorp, the receipt of updated fairness
opinions of the Advisor within five days of the scheduled
mailing of the proxy statement to Unicorp shareholders and
within five days of the Closing Date. Hibernia may abandon
the Merger if Unicorp shareholders holding more than 10% of
the outstanding Unicorp Common Stock exercise and perfect
dissenters' rights.
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 Unicorp 's shareholders may reduce the Exchange
Rate. In addition, any material change in the terms of the
Merger after the Special Meeting would require a
resolicitation of votes from Unicorp's shareholders.
Regulatory and Other Approvals
Hibernia is a registered bank holding company and as
such is regulated by the Federal Reserve Board. The
approval of the Federal Reserve Board of the Merger is
required in order to consummate the Merger, and the Merger
must be consummated within 90 calendar days after such
approval is obtained (unless the Federal Reserve Board
approves an extension of time). Approval of the Federal
Reserve Board for the Merger was obtained on August 14,
1997.
HNBT is regulated by the Office of the Comptroller of
the Currency (the "OCC"), and consequently the merger of the
Bank with and into HNBT must be approved by the OCC before
it may be effected. The OCC approved the bank level merger
on August 15, 1997.
Unicorp and Hibernia must wait at least 15 days after
the date of the Federal Reserve Board approval before they
may consummate the Merger. During this 15-day period, the
Department of Justice may object to the Merger on antitrust
grounds. As of the date of this Proxy Statement-Prospectus,
the Department of Justice has not objected to the Merger.
The shares of Hibernia Common Stock offered pursuant to
the Proxy Statement-Prospectus have been registered with the
Commission. The shares, however, will not be registered in
any state due to the enactment on October 11, 1996 of the
National Securities Markets Improvements Act of 1996 which
exempts from state regulation, among other things,
securities listed on the NYSE such as the shares of Hibernia
Common Stock offered pursuant to this Proxy Statement-
Prospectus.
The vote on the Merger at the Special Meeting is not
dependent or conditioned upon receipt of any regulatory
approvals prior to the Special Meeting. Even if the Merger
is approved at the Special Meeting, there is a possibility
that it will not be consummated.
Business Pending the Merger
Under the terms of the Agreement, neither Unicorp nor
the Bank, among other things, may, without the prior written
consent of Hibernia or as otherwise provided in the
Agreement: (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) enter into employment
contracts with directors, officers or employees or otherwise
agree to increase the compensation of or pay any bonus to
such persons except in accordance with existing agreements,
past practices during the preceding three years or as
provided for in the Agreement (provided that Hibernia has
consented to the payment on the Closing Date of the pro rata
portion of annual bonuses accrued on the books of the Bank
through the Closing Date to the extent that such accruals
are consistent in timing and amount with accruals made for
bonuses during the preceding three years and that such
bonuses are paid in the ordinary course of business); (iii)
enter into or substantially modify any employee benefits
plans; (iv) amend their respective Articles or By-Laws; (v)
other than as contemplated by the Agreement, establish any
automatic teller machines or branch or other banking
offices; (vi) make any capital expenditure(s) in excess of
$50,000; (vii) except as provided for in the Agreement,
merge with any other company or bank or liquidate or
otherwise dispose of its assets; (viii) in the case of
Unicorp , and not the Bank, make, declare, set aside or pay
any dividend or make any distribution on, or directly or
indirectly combine, redeem, purchase or otherwise acquire,
any shares of Unicorp Common Stock (other than in a
fiduciary capacity), provided, however, that Unicorp may
make, declare, set aside and pay regularly or specially
declared dividends not to exceed $.15 per share of Unicorp
Common Stock per fiscal quarter for each quarter completed
prior to the Effective Date, consistent in timing with past
practices during the preceding three years; or (ix) carry on
its business other than in the usual, regular and ordinary
course in substantially the same manner as previously
conducted or as provided in the Agreement. In addition,
Unicorp may not solicit bids or other transactions that
would result in a merger of Unicorp or the Bank with an
entity other than Hibernia or HNBT except in certain very
limited circumstances.
Termination
Prior to the Effective Date, the Agreement may be
terminated by either party, whether before or after approval
of the Agreement and the Merger by Unicorp's shareholders,
for the following reasons, among others: (i) in the event
of a breach by the other party of any representation,
warranty or covenant in the Agreement which would result in
a material adverse change in the financial condition,
results of operations, business or prospects of the
breaching party and which has not been cured within 60 days
after notice of the breach or which results in a material
increase in the cost of the non-breaching party's
performance of the Agreement; (ii) if any application for
any required federal or state regulatory approval has been
denied, and the time for all appeals of such denial has
expired; (iii) if the shareholders of Unicorp fail to
approve the Merger at the Special Meeting; or (iv) in the
event that the Merger is not consummated by March 31, 1998
or any condition to consummation of the Merger cannot be
satisfied by March 31, 1998 and will not be waived by the
party or parties entitled to waive it. The Agreement also
may be terminated (i) at any time by the mutual consent of
the parties; (ii) by Hibernia, if the holders of more than
10% of the outstanding Unicorp Common Stock exercise
statutory rights of dissent and appraisal pursuant to Texas
law; (iii) by Unicorp , if after May 28, 1997 a material
adverse change occurs in the financial condition, results of
operations, business or prospects of Hibernia or HNB
(excluding changes in laws or regulations affecting banking
institutions generally); (iv) by Hibernia, if after May 28,
1997 a material adverse change occurs in the financial
condition, results of operations, business or prospects of
Unicorp and the Bank (excluding changes in laws or
regulations affecting banking institutions generally); (v)
by Hibernia, in the event it shall determine that the Merger
does not qualify as a pooling-of-interests for accounting
purposes; or (vi) by Unicorp, if Unicorp does not receive an
updated fairness opinion from the Advisor dated within five
days of the date of scheduled mailing of this Proxy
Statement-Prospectus 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 Unicorp from a financial
point of view. Certain provisions of the Agreement,
including provisions relating to indemnification and
confidentiality, survive both the Merger and a termination
of the Agreement without the Merger having been completed.
Management and Operations After the Merger
On the Effective Date, Unicorp will be merged with and
into Hibernia and will cease to exist after the Merger. UB-
Delaware will also be merged with and into Hibernia, and its
separate existence will cease at that time. Simultaneously
with the Merger and the merger of UB-Delaware with and into
Hibernia, the Bank will be merged into HNBT, and the
separate existence of the Bank will also cease. HNBT will
continue to operate as a wholly-owned subsidiary of Hibernia
and will offer banking services similar to those offered
prior to the Merger.
The Boards of Directors of Hibernia and HNBT following
the Merger will consist of those persons serving as
directors immediately prior to the Merger. Certain
information regarding the directors of Hibernia elected at
its annual meeting of shareholders on April 29, 1997 is
contained in documents incorporated herein by reference.
See "AVAILABLE INFORMATION."
Certain Differences in Rights of Shareholders
If the shareholders of Unicorp approve the Merger and
the Merger is subsequently consummated all shareholders of
Unicorp, 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 By-Laws rather than Unicorp's Articles of
Incorporation and Bylaws, and the laws of the State of
Louisiana rather than the laws of the State of Texas. The
following is a summary of the principal differences between
the rights of shareholders of Unicorp and Hibernia not
described elsewhere in this Proxy Statement-Prospectus which
are due to differences in Hibernia's Articles of
Incorporation and By-Laws and Unicorp's Articles of
Incorporation and Bylaws and the fact that Hibernia Common
Stock is listed on the NYSE.
Stock. The total number of shares of all classes of
stock which Hibernia has authority to issue is 300,000,000,
of which 200,000,000 shares are designated as Class A Common
Stock of no par value and 100,000,000 shares are designated
as preferred stock, without par value. The rights,
preferences and privileges with respect to shares of
preferred stock may be determined by the Hibernia Board of
Directors. Consequently, shares of preferred stock could be
issued in circumstances in which it would make an attempted
acquisition of Hibernia more difficult. Hibernia currently
has 2,000,000 shares of preferred stock outstanding. The
holders of those preferred shares are entitled to receive
dividends on a quarterly basis and would have limited voting
rights if the dividends on their stock were not paid for a
certain period of time. If those voting rights were
triggered, the preferred shareholders may be able to elect a
director to the board of directors of Hibernia. Unicorp is
authorized to issue 9,000,000 shares of common stock and
1,000,000 shares of preferred stock. The rights,
preferences and privileges with respect to shares of
preferred stock may be determined by the Unicorp Board of
Directors. Unicorp currently has no shares of preferred
stock issued and outstanding.
Liquidity of Stock. There currently is no ready market
for the shares of Unicorp Common Stock, and such a market is
not likely to develop in the future. The shares of Hibernia
Common Stock, if issued in the Merger will be registered
under applicable securities laws and may therefore be freely
resold by persons who are not "affiliates" of Unicorp or
Hibernia. See "Resale of Hibernia Stock." In addition, the
Hibernia Common Stock is listed on the NYSE and actively
traded on that exchange. 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.
Directors' Qualifications. No individual will be
elected a director of Hibernia unless such individual owns,
in his or her own right, at the time of such election, not
less than 100 shares of Hibernia voting stock. No
individual will be eligible for election as a director of
Hibernia who has attained the age of 71 prior to the date of
such election. No individual who is or becomes a business
competitor or who is or becomes affiliated with, employed by
or a representative of any individual, corporation,
association, partnership, firm, business enterprise or other
entity or organization which the Hibernia Board determines
to be in competition with Hibernia will be eligible for
election as a director of Hibernia. Any financial
institution having branches or affiliates within any state
in which Hibernia or any of its subsidiaries operates or
having (together with its affiliates) total assets or total
deposits exceeding $500 million will be presumed to be a
business competitor of Hibernia, unless the Board of
Directors of Hibernia (the "Hibernia Board") determines
otherwise. Unicorp does not have similar qualification
limitations for its directors. Unicorp's directors need not
be residents of Texas or shareholders of the corporation.
Number of Directors. The number of Hibernia
directors will be as determined, from time to time, by
resolution of the Hibernia Board. The Unicorp Board will
consist of that number of directors, not less than four nor
more than twenty, as may from time to time be prescribed by
the Unicorp Board.
Term of Office of Directors. Hibernia's By-Laws
provide that the Hibernia Board shall consist of three
classes, as nearly equal in number as practicable, and that
the term of office of the directors in each class shall be
three years. Unicorp's Bylaws contain no similar provision
with respect to classes of directors and provide that each
Director elected shall hold office for the term for which he
or she is elected, which is generally one year.
Notice of Shareholders' Meeting. Written notice of
the place, day and hour of a Unicorp meeting, and in the
case of a special meeting, the purpose or purposes for which
the meeting is called, must be given not less than 10 nor
more than 50 days before the date of the meeting, either
personally or by mail, to each shareholder entitled to vote
at the meeting. Hibernia's Articles and By-Laws have no
similar provision; however, Louisiana law requires that
written notice of the time, place, and in the case of a
special meeting, the purpose of the meeting, be given to all
stockholders entitled to vote at the meeting at least 10
days and not more than 60 days prior to the date fixed for
the meeting.
Removal of Directors. Shareholders of Hibernia may
remove one or more director(s) for cause (defined as gross
negligence or willful misconduct) by the vote of a majority
of the total voting power and may remove a director without
cause by a vote of two-thirds of the total voting power.
One or more directors of Unicorp may be removed at any time,
with or without cause, at any special or annual meeting of
the shareholders, by the affirmative vote of a majority of
the shares present, in person or by proxy, at such meeting
and entitled to vote for the election of such director, if
notice of intention to act upon such matter has been given
in the notice calling such meeting.
Amendment of Articles and By-Laws. Hibernia's Articles
of Incorporation may be amended by a vote of a majority of
the voting power present at any meeting called for that
purpose. Unicorp 's Articles of Incorporation do not have
similar provisions; however, under Texas law Unicorp's
Articles of Incorporation may be amended by a vote of the
holders of two-thirds of the Unicorp Common Stock.
The By-Laws of Hibernia may be amended or repealed by a
vote of a majority of the total voting power outstanding or
by a vote of two-thirds of the "continuing directors" of the
company, as defined in the By-Laws. A "continuing director"
for this purpose is generally a director who was nominated
for election by a majority of the existing directors. The
Unicorp Bylaws may be altered, amended, or repealed and new
Bylaws may be adopted by the Unicorp Board, at any meeting
of the Board at which a quorum is present, by the
affirmative vote of a majority of the directors present at
such meeting (provided notice of the proposed alteration,
amendment or repeal is contained in the notice of the
meeting), subject to repeal or change by action of the
shareholders at any meeting of the shareholders at which a
quorum is present, by the affirmative vote of a majority of
the shareholders present at such meeting (provided notice of
the proposed alteration, amendment or repeal is contained in
the notice of the meeting).
Special Meetings of Shareholders. Special meetings of
the shareholders of Hibernia may be called by the Chairman
of the Board, the President, the Chief Executive Officer,
the Treasurer, or the Hibernia Board. In addition,
shareholders holding one-fifth or more of the total voting
power of Hibernia may request a special meeting of
shareholders and, upon receipt of such request, the
Secretary of Hibernia is required to call a special meeting
of the shareholders. A special meeting of shareholders of
Unicorp may be called at any time by the President, the
Unicorp Board, or the holders of not less than 10% of all
shares entitled to vote at such meeting.
Shareholder Proposals. Hibernia's By-Laws contain
certain provisions expressly allowing shareholders to submit
shareholder proposals and to nominate individuals for
election as directors, under certain circumstances and
provided the shareholder complies with all of the conditions
set forth in those provisions. Unicorp's Bylaws contain no
specific provisions relating to shareholder proposals.
Inspection Rights. At least ten days before each
meeting of Unicorp shareholders, the officer or agent having
charge of the stock transfer books must prepare a complete
list of Unicorp's shareholders entitled to vote at such
meeting or any adjournment thereof, arranged in alphabetical
order, including the address of each shareholder and the
number of voting shares held by each shareholder. For a
period of ten days prior to such meeting, such list must be
kept on file at the registered office of Unicorp and must be
subject to inspection by any shareholder during usual
business hours. Such list must be produced at such meeting,
and at all times during such meeting must be subject to
inspection by any shareholder. Hibernia's Articles of
Incorporation and By-Laws contain no specific provision
relating to inspection rights; however, Louisiana law
requires that a list of shareholders entitled to vote,
arranged alphabetically and certified by the Secretary or by
the agent in charge of share transfers, showing the number
and class of shares held by each shareholder on the record
date for the meeting shall be made available at a
shareholder meeting and produced at the request of any
shareholder.
Shareholders' Meetings - Telephone Conference. The
Bylaws of Unicorp permit shareholders to participate in and
hold a meeting by means of conference telephone or similar
communication equipment by means of which all persons
participating in the meeting can hear each other.
Participation in such a meeting constitutes presence in
person at the meeting, except where a person participates in
the meeting for the express purpose of objecting to the
transaction of any business on the ground the meeting is not
lawfully called or convened. Telephonic shareholder
meetings are not permitted under Louisiana law.
Vacancy on Board of Directors. Any vacancy
occurring in the Unicorp board of directors may be filled by
the affirmative vote of a majority of the remaining
directors though less than a quorum of the board of
directors, except that any vacancy in the board of directors
resulting from the removal of a director by the shareholders
shall be filled only by the shareholders entitled to vote at
an annual meeting or a special meeting called for that
purpose. A director elected to fill a vacancy shall be
elected for the unexpired term of his predecessor in office.
Any directorship to be filled by reason of an increase in
the number of directors shall be filled by election at an
annual meeting or at a special meeting of the shareholders
entitled to vote called for that purpose. Hibernia's By-
Laws contain no specific provisions relative to filling
vacancies on the Hibernia Board; however, Louisiana law
provides that in the event of a vacancy on the Hibernia
Board, the remaining directors, even though not constituting
a quorum, may, by majority vote, fill any vacancy on the
Hibernia Board (including any vacancy resulting from an
increase in the authorized number of directors, or from
failure of the shareholders to elect the full number of
authorized directors) for an unexpired term, provided that
the shareholders shall have the right, at any special
meeting called for the purpose prior to such action by the
Hibernia Board, to fill the vacancy.
Merger or Consolidation. Hibernia's Articles of
Incorporation allow an agreement of merger or consolidation
to be approved by a majority vote of the voting shares
issued and outstanding, taken at a meeting called for the
purpose of such approval. Unicorp's Articles contain no
similar provisions; however, under Texas law, an agreement
of merger or consolidation such as the Agreement, may be
approved by a vote of two-thirds of the Unicorp Common
Stock.
Dissenting Shareholder's Rights. Each Unicorp
shareholder who objects to the Merger is entitled to the
rights and remedies of dissenting shareholders provided by
Texas law. See "PROPOSED MERGER -- Rights of Dissenting
Shareholders." Louisiana law provides that a shareholder's
right to dissent does not exist in the case of shareholders
holding shares of any class of stock that are listed on a
national securities exchange, such as Hibernia Common Stock,
unless the shares of such shareholders are not converted by
the merger or consolidation solely into shares of the
surviving or new corporation. In such event, a shareholder
who votes against the merger shall have the right to dissent
only if the shareholders authorize the merger by less than
80% of the total voting power.
Interests of Certain Persons in the Merger
The terms of the Agreement include certain provisions
that protect the officers and directors of Unicorp and the
Bank from and against liability for actions arising while
they served in those capacities for Unicorp. The Agreement
provides for indemnification of such persons to the same
extent as they would have been indemnified under the
Articles of Incorporation and By-Laws of Hibernia in effect
on May 28, 1997, except that the Agreement limits Hibernia's
aggregate liability for such indemnification to $5 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 Agreement permits management of Unicorp to purchase
insurance coverage for directors and officers liability
claims that may arise after the Merger is completed. This
coverage may only be purchased, however, if its cost does
not exceed the premium refunded from Unicorp's existing
directors and officers liability policy. Management of
Unicorp is analyzing the feasibility of this type of
coverage.
The Agreement also provides for indemnification of
Unicorp's and the Bank's officers, directors and certain
affiliates from and against liability arising under the
Securities Act or otherwise insofar as such liability arises
out of or is based on an untrue statement or alleged untrue
statement of a material fact contained in this Proxy
Statement-Prospectus or arises out of or is based upon the
omission or alleged omission to state herein a material fact
required to be stated herein or necessary to make the
statements made herein not misleading. This indemnification
does not apply to statements made in reliance on information
furnished to Hibernia by Unicorp for use in the Registration
Statement, including this Proxy Statement-Prospectus.
The Agreement also requires Hibernia to enter into
mutually satisfaction employment agreements with Carlos
Vacek, President of Unicorp, and Lin Bingham, Chief
Financial Officer of Unicorp. These agreements will provide
for a term of three years and two years for Mr. Vacek and
Mr. Bingham, respectively, and for salary, bonus and
benefits at essentially the levels currently being paid by
Unicorp.
Material Tax Consequences
The following summary description of the material
income tax consequences of the Merger 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,
her or it.
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 of the Code, that the exchange of Unicorp Common
Stock for Hibernia Common Stock will not give rise to the
recognition of gain or loss for federal income tax purposes
to Unicorp's shareholders with respect to such exchange and
certain other tax consequences of the Merger. See "PROPOSED
MERGER -- Representations and Warranties; Conditions to the
Merger; Waiver."
If the Merger constitutes a reorganization within the
meaning of Section 368 of the Code: (i) no gain or loss
will be recognized by Unicorp, the Bank, Hibernia, HNB or
HNBT by reason of the Merger; (ii) a shareholder of Unicorp
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 Unicorp Common Stock; (iii) the
tax basis in the Hibernia Common Stock received by a
shareholder of Unicorp will be the same as the tax basis in
the Unicorp Common Stock surrendered in exchange therefor;
and (iv) the holding period, for federal income tax
purposes, for Hibernia Common Stock received in exchange for
Unicorp Common Stock will include the period during which
the shareholder held the Unicorp Common Stock surrendered in
the exchange, provided that the Unicorp Common Stock was
held as a capital asset at the Effective Date.
The parties have received the opinion of Ernst & Young
LLP, certified public accountants, to the effect that the
Merger, if consummated in accordance with the terms of the
Agreement, will constitute a reorganization for purposes of
Section 368 of the Code and will have the tax effects
described in this section. A copy of the opinion of Ernst &
Young LLP in this regard is attached hereto as Appendix D.
As noted in the opinion, the opinion is based upon certain
representations and assumptions described therein.
Shareholders of Unicorp are urged to review the full text of
the opinion of Ernst & Young LLP attached hereto as Appendix
D with regard to the tax consequences of the Merger to them.
Because of the complexities of the tax laws, and
because the tax consequences to a particular shareholder may
be affected by matters that are personal to him, it is
recommended that each shareholder consult his own tax
advisor concerning the applicable federal, state and local
tax consequences of the Merger.
For information regarding the federal income tax
consequences of cash payments received by dissenting
shareholders, see "PROPOSED MERGER -- Rights of Dissenting
Shareholders."
Resale of Hibernia Common Stock
The shares of Hibernia Common Stock issuable to
shareholders of Unicorp upon consummation of the Merger have
been registered under the Securities Act. It is a condition
to closing of the Merger that all shares of Hibernia Common
Stock issued in connection with the Merger be approved for
listing, upon official notice of issuance, on the NYSE.
Such shares may be traded freely by those shareholders not
deemed to be affiliates of Unicorp as that term is defined
under the Securities Act. The term "affiliate" generally
means each person who controls, or is a member of a group
that controls, or who is under common control with, Unicorp,
and for purposes hereof could be deemed to include all
executive officers, directors and 10% shareholders of
Unicorp.
Hibernia Common Stock received and beneficially owned
by those shareholders who are deemed to be affiliates of
Unicorp may be resold without registration as provided by
Rule 145, or as otherwise permitted, under the Securities
Act. Such affiliates, provided they are not affiliates of
Hibernia, may publicly resell Hibernia Common Stock received
by them in the Merger if they register the resale of those
shares or they comply with the restrictions of Rule 145.
Anyone who is or may be an affiliate of Unicorp should
carefully consider the resale restrictions imposed by Rule
145 prior to attempting to transfer any shares of Hibernia
Common Stock after the Merger. In addition, shares of
Hibernia Common Stock issued to affiliates of Unicorp in the
Merger will not be transferable until financial statements
pertaining to at least 30 days of post-Merger combined
operations of Hibernia and Unicorp have been published, in
order to satisfy certain requirements of the Commission
relating to pooling-of-interests accounting treatment.
The Agreement requires Unicorp to identify those
persons who may be deemed to be affiliates of Unicorp and to
use its best efforts to cause each person so identified to
deliver to Hibernia a written agreement providing that such
person will not dispose of Unicorp Common Stock or Hibernia
Common Stock received in the Merger except in compliance
with the Securities Act, the rules and regulations
promulgated thereunder and the Commission's rules relating
to pooling-of-interests accounting treatment. In addition,
Hibernia intends to place stop transfer instructions with
its transfer agent regarding Hibernia Common Stock issued to
affiliates of Unicorp to ensure that transfers by those
persons comply with Rule 145 and the terms of any applicable
affiliate resale agreement with Hibernia.
Rights of Dissenting Shareholders
Holders of shares of Unicorp Common Stock have a
statutory right to dissent from the Merger by following the
specific procedures set forth below. If the Merger is
approved and consummated, holders of shares of Unicorp
Common Stock who properly perfect their dissenters' rights
will be entitled to receive an amount of cash equal to the
fair value of their shares of Unicorp Common Stock rather
than being required to accept the consideration therefor
provided in the Agreement. The following summary is not a
complete statement of the statutory dissenters' rights of
appraisal, and such summary is qualified in its entirety by
reference to the applicable provisions of the Texas Business
Corporation Act ("TBCA"), which are reproduced in full at
Appendix C hereto. A Unicorp shareholder must follow the
exact procedure required by the TBCA in order to properly
exercise his dissenter's rights of appraisal and avoid
waiver of those rights.
Holders of shares of Unicorp Common Stock who desire to
dissent from the Merger must file a written objection to the
Merger with Unicorp , 302 N. 5th Street, Orange, Texas 77630-
5707, (Attention: Shirley Hall), prior to the Special
Meeting. This written notice must state that the
shareholder will exercise his right to dissent if the Merger
is consummated and give the shareholder's address to which
notice of effectiveness of the Merger should be sent. A
vote against the Merger is not sufficient to perfect a
shareholder's statutory right to dissent from the Merger.
If the Merger is consummated, each shareholder who sent
notice to Unicorp as described above and who did not vote in
favor of the Merger will be deemed to have dissented from
the Merger ("Dissenting Shareholder"). Failure to vote
against the Merger will not constitute a waiver of the
dissenters' rights of appraisal; on the other hand, a vote
in favor of the Merger will constitute such a waiver.
Hibernia will be liable for any payments to Dissenting
Shareholders and will, within 10 days of the Effective Date,
notify the Dissenting Shareholders in writing that the
Merger has been effected. Each Dissenting Shareholder so
notified must, within 10 days of the delivery or mailing of
such notice, make a written demand on Hibernia at 313
Carondelet Street, New Orleans, Louisiana 70130, Attention:
Patricia C. Meringer, Secretary, for payment of the fair
value of the Dissenting Shareholder's shares of Unicorp
Common Stock as estimated by the Dissenting Shareholder.
Failure to follow this procedure will constitute a waiver of
his dissenter's rights of appraisal by such Dissenting
Shareholder. The demand must state the number of shares of
Unicorp Common Stock owned by the Dissenting Shareholder and
the fair value of the shares as estimated by the Dissenting
Shareholder. The fair value of the shares will be the value
thereof as of the day immediately preceding the Special
Meeting, excluding any appreciation or depreciation in
anticipation of the Merger. Dissenting Shareholders who
fail to make a written demand within the ten-day period will
be bound by the Merger and lose their rights to dissent.
Within 20 days after making a demand, the Dissenting
Shareholder must submit certificates representing his shares
of Unicorp Common Stock to Hibernia for notation thereon
that such demand has been made. Dissenting Shareholders who
have made a demand for payment of their shares will not
thereafter be entitled to vote or exercise any other rights
of a shareholder except the right to receive payment for
their shares pursuant to the provisions of the TBCA and the
right to maintain an appropriate action to obtain relief on
the basis of fraud.
Within 20 days after receipt of a Dissenting
Shareholder's demand letter as described above, Hibernia
will deliver or mail to the Dissenting Shareholder written
notice (i) stating that Hibernia accepts the amount claimed
in the demand letter and agrees to pay that amount, within
90 days after the Effective Date, upon surrender of the
relevant certificates of Unicorp Common Stock duly endorsed
by the Dissenting Shareholder, or (ii) containing Hibernia's
written estimate of the fair value of the shares of Unicorp
Common Stock together with an offer to pay such amount
within 90 days after the Effective Date if Hibernia receives
notice, within 60 days after the Effective Date, stating
that the Dissenting Shareholder agrees to accept that amount
and upon surrender of the relevant certificates of Unicorp
Common Stock duly endorsed by the Dissenting Shareholder.
In either case, the Dissenting Shareholder will cease to
have any ownership interest in Hibernia or Unicorp following
payment of the agreed value.
If the Dissenting Shareholder and Hibernia cannot agree
on the fair value of the shares within 60 days after the
Effective Date, the Dissenting Shareholder or Hibernia may,
within 60 days of the expiration of such sixty-day period,
file a petition ("Petition") in any court of competent
jurisdiction in Orange County, Texas, requesting a finding
and determination of the fair value of the Dissenting
Shareholder's shares. Each Dissenting Shareholder is not
required to file a separate Petition. If one Dissenting
Shareholder files a Petition, Hibernia must file, with the
clerk of the court in which the Petition was filed, a list
containing the names and addresses of the Dissenting
Shareholders with whom agreements as to the value of their
shares have not been reached. The court will give notice of
the time and place of the hearing on the Petition to the
Dissenting Shareholders named on the list. Dissenting
Shareholders so notified by the court will be bound by the
final judgment of the court regarding fair value of the
shares. If no petition is filed within the appropriate time
period, then all Dissenting Shareholders who have not
reached an agreement with Hibernia on the value of their
shares will be bound by the Merger and lose their right to
dissent.
After a hearing concerning the petition, the court will
determine which Dissenting Shareholders have complied with
the provisions of the TBCA and have become entitled to the
valuation of, and payment for, their shares, and will
appoint one or more qualified appraisers to determine the
value of the shares of Unicorp Common Stock in question.
The appraisers will determine such value and file a report
with the court. The court will then in its judgment
determine the fair value of the shares of Unicorp Common
Stock, which judgment will be binding on Hibernia and on all
Dissenting Shareholders receiving notice of the hearing.
The court will direct Hibernia to pay such amount, together
with interest thereon, beginning 91 days after the Effective
Date of the Merger to the date of judgment, to the
Dissenting Shareholders entitled thereto. The judgment will
be payable upon the surrender to Hibernia of certificates
representing shares of Unicorp Common Stock duly endorsed by
the Dissenting Shareholder. Upon payment of the judgment,
the Dissenting Shareholders will cease to have any interest
in Hibernia. The court will allow the appraisers a
reasonable fee as court costs, and all court costs will be
allotted between the parties in the manner that the court
determines to be fair and equitable.
Any Dissenting Shareholder who has made a written
demand on Hibernia for payment of the value of his Unicorp
Common Stock may withdraw such demand at any time before
payment for his shares has been made or before a petition
has been filed with an appropriate court for determination
of the fair value of such shares but no such demand may be
withdrawn after such payment has been made or, unless
Hibernia will consent thereto, after such petition has been
filed. If a Dissenting Shareholder withdraws his demand, or
if he is otherwise unsuccessful in asserting his dissenters'
rights of appraisal, such Dissenting Shareholder will be
bound by the Merger and his status as a former shareholder
of Unicorp will be restored without prejudice to any
corporate proceedings, dividends or distributions made to
shareholders in the interim.
In the absence of fraud in the transaction, a
Dissenting Shareholder's statutory right of appraisal is the
exclusive remedy for the recovery of the value of his shares
or money damages to the shareholder with respect to the
Merger.
Cash received by a Dissenting Shareholder of Unicorp in
exchange for his or her Unicorp Common Stock will generally
be subject to state and federal income tax and should 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 should 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. In that
case, the shareholder would recognize ordinary income or
capital gain, as the case may be, in an amount equal to the
difference between the amount of cash received in redemption
of his shares and his basis in his Unicorp Common Stock.
Dividend Reinvestment Plan
Hibernia maintains a Dividend Reinvestment Plan through
which shareholders of Hibernia who participate in the plan
may reinvest dividends in Hibernia Common Stock. Shares are
purchased for participants in the plan at their market value
as determined by the market price of the stock as listed 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 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
Unicorp 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. In order for the Merger to
qualify for pooling-of-interests accounting treatment, among
other things, 90% or more of the outstanding Unicorp Common
Stock must be exchanged for Hibernia Common Stock. If
holders of more than 10% of the outstanding Unicorp Common
Stock exercise and perfect dissenters' rights, the Merger
will not qualify as a pooling of interests. Also, in order
for the pooling-of-interests accounting method to apply,
"affiliates" of Unicorp cannot, directly or indirectly,
sell, transfer, pledge or otherwise alienate or encumber any
shares of Hibernia Common Stock received in the Merger until
such time as at least 30 days of post-Merger combined
operations of Unicorp and Hibernia have been published.
Persons believed by Unicorp to be "affiliates" have agreed
to comply with these restrictions.
Unicorp 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.
CERTAIN REGULATORY CONSIDERATIONS
General
As a bank holding company, Hibernia is subject to the
regulation and supervision of 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 under the
BHCA in nonbanking activities, subject to certain
exceptions.
Hibernia's banking subsidiaries, HNB and HNBT, are
subject to supervision and examination by applicable federal
and state banking agencies. HNB and HNBT are national
banking associations subject to the regulation and
supervision of the OCC. HNB and HNBT are 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 be
offered. Various consumer laws and regulations also affect
the operations of HNB and HNBT. In addition to the impact
of 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 generally depends upon payment of dividends by
HNB and HNBT in order to pay dividends to its shareholders
and to meet its other needs for cash to pay expenses.
Hibernia derives substantially all of its income from the
payment of dividends by HNB and HNBT, and its ability to pay
dividends is affected by the ability of HNB and HNBT to pay
dividends. HNB and HNBT are subject to various statutory
restrictions on their ability to pay dividends to Hibernia.
Under such restrictions, the amount available for payment of
dividends to Hibernia by HNB was approximately $190 million
and by HNBT was approximately $6 million at June 30, 1997.
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 if the payment of the dividend would deplete a
bank's capital to an inadequate level. The ability of HNB
and HNBT to pay dividends in the future is presently, and
could be further, influenced by bank regulatory policies or
agreements and by capital guidelines applicable to banks and
bank holding companies. Additional information in this
regard is contained in documents incorporated by reference
herein. See "AVAILABLE INFORMATION."
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 stockholders 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.
Restrictions on Extensions of Credit
HNB and HNBT are subject to restrictions imposed by fe
deral 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. In addition, all such transaction
with a single affiliate are generally limited to 10% of
HNB's and HNBT's capital and surplus, and all such
transactions with affiliates may not exceed 20% of HNB's and
HNBT's capital and surplus.
Hibernia's banking subsidiaries are also limited in the
aggregate amount that may be loaned to a single borrower or
a group of borrowers that are deemed to be affiliated with
each other for purposes of these rules. These loans are
limited to 15% of HNB's and HNBT's capital and surplus.
<PAGE>
PRO FORMA FINANCIAL INFORMATION
The following unaudited pro forma combined balance sheet of Hibernia as
of June 30, 1997 and income statements of Hibernia for the six-month periods
ended June 30, 1997 and 1996 and the years ended December 31, 1996, 1995 and
1994 give effect to the pending merger with Unicorp, assuming the Merger is
accounted for using the pooling-of-interests method of accounting, and as if the
Merger had been consummated on January 1, 1994.
The information at June 30, 1997 and for the six-month periods ended
June 30, 1997 and 1996 in the column titled "Hibernia Corporation" is summarized
from the unaudited consolidated financial statements of Hibernia contained in
Hibernia's Quarterly Report on Form 10-Q for the quarter ended June 30, 1997.
The information for the years ended December 31, 1996, 1995 and 1994 in
the column titled "Hibernia Corporation" is summarized from the consolidated
financial statements of Hibernia contained in Hibernia's Annual Report on Form
10-K for the year ended December 31, 1996.
The information contained in the column titled "Unicorp Bancshares -
Texas, Inc." is based on, and should be read in conjunction with the financial
statements and related notes and Management's Discussion and Analysis of
Financial Condition and Results of Operations of Unicorp contained elsewhere in
this Proxy Statement - Prospectus.
The Pro Forma Financial Statements are presented for information
purposes only and are not necessarily indicative of the combined financial
position or results of operations which would actually have occurred if the
Merger had been consummated in the past or which may be obtained in the future.
<PAGE>
Pro Forma Combined Balance Sheet (Unaudited)
The following unaudited pro forma combined balance sheet combines the
balance sheets of Hibernia and Unicorp as if the Merger had been effective on
June 30, 1997. This unaudited pro forma combined balance sheet should be read in
conjunction with the financial statements and related notes of Hibernia
contained in Hibernia's Quarterly Report on Form 10-Q for the quarter ended June
30, 1997 incorporated by reference into this Proxy Statement - Prospectus, and
the June 30, 1997 financial statements and related notes of Unicorp included
elsewhere herein.
<PAGE>
<TABLE>
<CAPTION>
PRO FORMA COMBINED BALANCE SHEET
Hibernia Corporation and Subsidiaries
June 30, 1997
- ------------------------------------------------------------------------------------------------------------------------------------
UNICORP PRO PRO FORMA
HIBERNIA BANCSHARES- FORMA HIBERNIA
Unaudited ($ in thousands) CORPORATION TEXAS, INC. ADJUSTMENTS CORPORATION
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
ASSETS
Cash and due from banks .................................. $ 462,991 $ 8,350 $ 471,341
Short-term investments ................................... 228,444 550 ($3,135)(B) 225,859
Securities available for sale ............................ 2,050,015 35,357 2,085,372
Securities held to maturity .............................. - - -
Loans, net of unearned income ............................ 6,555,095 64,762 6,619,857
Reserve for possible loan losses ..................... (120,176) (571) (120,747)
- ------------------------------------------------------------------------------------------------------------------------------------
Loans, net ....................................... 6,434,919 64,191 - 6,499,110
- ------------------------------------------------------------------------------------------------------------------------------------
Bank premises and equipment .............................. 171,106 2,926 174,032
Customers' acceptance liability .......................... 1,183 - 1,183
Goodwill ................................................. 130,651 2,503 133,154
Other intangibles assets ................................. 21,748 - 21,748
Other assets ............................................. 172,211 1,468 173,679
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL ASSETS ..................................... $ 9,673,268 $ 115,345 ($3,135) $ 9,785,478
- ------------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
Deposits:
Demand, noninterest-bearing .......................... $ 1,433,559 $ 33,123 $ 1,466,682
Interest-bearing ..................................... 6,535,306 69,801 6,605,107
- ------------------------------------------------------------------------------------------------------------------------------------
Total Deposits ................................... 7,968,865 102,924 8,071,789
- ------------------------------------------------------------------------------------------------------------------------------------
Short-term borrowings .................................... 591,463 - 591,463
Liability on acceptances ................................. 1,183 - 1,183
Other liabilities ........................................ 134,776 1,015 ($ 20)(B) 135,771
Debt ..................................................... 7,028 3,115 ( 3,115)(B) 7,028
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL LIABILITIES ................................ 8,703,315 107,054 ( 3,135) 8,807,234
- ------------------------------------------------------------------------------------------------------------------------------------
SHAREHOLDERS' EQUITY
Preferred Stock .......................................... 100,000 - 100,000
Common Stock ............................................. 248,011 1,403 25 (A) 252,299
Surplus .................................................. 379,918 2,787 (2,906)(A) 379,799
Retained earnings ........................................ 257,550 3,959 261,509
Treasury stock ........................................... (639) (21) 21(A) (639)
Unrealized gains (losses) on securities available for sale 3,388 163 3,551
Unearned compensation .................................... (18,275) - (18,275)
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL SHAREHOLDERS' EQUITY ....................... 969,953 8,291 - 978,244
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY ....... $ 9,673,268 $ 115,345 ($3,135) $ 9,785,478
- ------------------------------------------------------------------------------------------------------------------------------------
- -----------------
See notes to Pro Forma Combined Balance Sheet.
</TABLE>
<PAGE>
HIBERNIA CORPORATION
NOTES TO PRO FORMA COMBINED BALANCE SHEET
June 30, 1997
A. Hibernia plans to issue approximately 2,233,389 shares of Hibernia
Common Stock, with an aggregate market value at the date of the Merger
of $37,409,266 based upon an assumed market value of $16.75 per share,
in exchange for 1,395,868 shares of Unicorp Common Stock outstanding at
June 30, 1997 to effect the Merger with Unicorp resulting in an
exchange rate of 1.6.
The stated value of the 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 for the
purposes of this pro forma combined balance sheet.
B. Hibernia will use available federal funds sold to retire Unicorp debt
of $3,115,000 and related accrued interest of $20,000. The retirement
of this debt is not a requirement of the Merger.
<PAGE>
Pro Forma Combined Income Statements (Unaudited)
The following unaudited pro forma combined income statements for the
six months ended June 30, 1997 and 1996 and the years ended December 31, 1996,
1995, and 1994 combine the income statements of Hibernia and Unicorp as if the
Merger had been effective on January 1, 1994. The unaudited pro forma combined
income statements should be read in conjunction with the consolidated financial
statements and notes of Hibernia contained in Hibernia's Quarterly Report on
Form 10-Q for the quarter ended June 30, 1997 and Hibernia's Annual Report on
Form 10-K for the year ended December 31, 1996, each incorporated by reference
into this Proxy Statement - Prospectus, and the financial statements and notes
for the years ended December 31, 1996 and 1995 and the six-month periods ended
June 30, 1997 and 1996 of Unicorp contained elsewhere herein. The cost
associated with the Merger, estimated to be approximately $500,000, will be
accounted for as a current period expense when incurred.
<PAGE>
<TABLE>
<CAPTION>
HIBERNIA CORPORATION
PRO FORMA COMBINED INCOME STATEMENT
Six months ended June 30, 1997
UNICORP PRO FORMA
HIBERNIA BANCSHARES- HIBERNIA
Unaudited ($ in thousands, except per share data) CORPORATION TEXAS, INC. CORPORATION
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Interest income
Interest and fees on loans ................... $ 273,861 $ 3,134 $ 276,995
Interest on securities available for sale .... 70,488 1,164 71,652
Interest on securities held to maturity ...... - - -
Interest on short-term investments ........... 5,939 148 6,087
- ------------------------------------------------------------------------------------------------------------
Total interest income .................... 350,288 4,446 354,734
- ------------------------------------------------------------------------------------------------------------
Interest expense
Interest on deposits ......................... 136,326 1,295 137,621
Interest on short-term borrowings ............ 10,092 - 10,092
Interest on debt ............................. 747 123 870
- ------------------------------------------------------------------------------------------------------------
Total interest expense ................... 147,165 1,418 148,583
- ------------------------------------------------------------------------------------------------------------
Net interest income .............................. 203,123 3,028 206,151
Provision for possible loan losses ........... - 70 70
- ------------------------------------------------------------------------------------------------------------
Net interest income after provision
for possible loan losses ...................... 203,123 2,958 206,081
- ------------------------------------------------------------------------------------------------------------
Noninterest income
Service charges on deposits .................. 33,571 602 34,173
Trust fees ................................... 7,185 3 7,188
Other service, collection and exchange charges 20,420 76 20,496
Other operating income ....................... 6,753 169 6,922
Securities gains (losses), net ............... 371 - 371
- ------------------------------------------------------------------------------------------------------------
Total noninterest income ................. 68,300 850 69,150
- ------------------------------------------------------------------------------------------------------------
Noninterest expense
Salaries and employee benefits ............... 84,568 1,138 85,706
Occupancy expense, net ....................... 14,708 148 14,856
Equipment expense ............................ 13,845 103 13,948
Data processing expense ...................... 9,793 196 9,989
Foreclosed property expense, net ............. (574) 1 (573)
Amortization of intangibles .................. 7,009 90 7,099
Other operating expense ...................... 44,447 656 45,103
- ------------------------------------------------------------------------------------------------------------
Total noninterest expense ................ 173,796 2,332 176,128
- ------------------------------------------------------------------------------------------------------------
Income before income taxes ....................... 97,627 1,476 99,103
Income tax expense ............................... 34,078 473 34,551
- ------------------------------------------------------------------------------------------------------------
Income from continuing operations ................ $ 63,549 $ 1,003 $ 64,552
- ------------------------------------------------------------------------------------------------------------
Income from continuing operations
applicable to common shareholders ............ $ 60,099 $ 1,003 $ 61,102
- ------------------------------------------------------------------------------------------------------------
Pro forma weighted average common shares ......... 127,240,768 2,233,389 129,474,157
- ------------------------------------------------------------------------------------------------------------
Pro forma income per common share from
continuing operations (A) ................... $ 0.47 $ 0.47
- ------------------------------------------------------------------------------------------------------------
- -------------
See notes to Pro Forma Combined Income Statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
HIBERNIA CORPORATION
PRO FORMA COMBINED INCOME STATEMENT
Six months ended June 30, 1996
UNICORP PRO FORMA
HIBERNIA BANCSHARES- HIBERNIA
Unaudited ($ in thousands, except per share data) CORPORATION TEXAS, INC. CORPORATION
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Interest income
Interest and fees on loans ................... $ 224,101 $ 2,265 $ 226,366
Interest on securities available for sale .... 69,923 775 70,698
Interest on securities held to maturity ...... - -
Interest on short-term investments ........... 4,813 220 5,033
- ---------------------------------------------------------------------------------------------------------
Total interest income .................... 298,837 3,260 302,097
- ---------------------------------------------------------------------------------------------------------
Interest expense
Interest on deposits ......................... 115,844 959 116,803
Interest on short-term borrowings ............ 7,020 - 7,020
Interest on debt ............................. 779 22 801
- ---------------------------------------------------------------------------------------------------------
Total interest expense ................... 123,643 981 124,624
- ---------------------------------------------------------------------------------------------------------
Net interest income .............................. 175,194 2,279 177,473
Provision for possible loan losses ........... 975 48 1,023
- ---------------------------------------------------------------------------------------------------------
Net interest income after provision
for possible loan losses ...................... 174,219 2,231 176,450
- ---------------------------------------------------------------------------------------------------------
Noninterest income
Service charges on deposits .................. 27,054 438 27,492
Trust fees ................................... 6,451 2 6,453
Other service, collection and exchange charges 16,468 67 16,535
Other operating income ....................... 5,738 93 5,831
Securities gains (losses), net ............... 113 - 113
- ---------------------------------------------------------------------------------------------------------
Total noninterest income ................. 55,824 600 56,424
- ---------------------------------------------------------------------------------------------------------
Noninterest expense
Salaries and employee benefits ............... 75,203 780 75,983
Occupancy expense, net ....................... 13,203 90 13,293
Equipment expense ............................ 11,333 63 11,396
Data processing expense ...................... 10,315 132 10,447
Foreclosed property expense, net ............. (1,675) 1 (1,674)
Amortization of intangibles .................. 1,924 16 1,940
Other operating expense ...................... 36,335 481 36,816
- ---------------------------------------------------------------------------------------------------------
Total noninterest expense ................ 146,638 1,563 148,201
- ---------------------------------------------------------------------------------------------------------
Income before income taxes ....................... 83,405 1,268 84,673
Income tax expense ............................... 28,960 416 29,376
- ---------------------------------------------------------------------------------------------------------
Income from continuing operations ................ $ 54,445 $ 85 $ 55,297
- ---------------------------------------------------------------------------------------------------------
Income from continuing operations
applicable to common shareholders ............ $ 54,445 $ 85 $ 55,297
- ---------------------------------------------------------------------------------------------------------
Pro forma weighted average common shares ......... 126,571,918 2,233,389 128,805,307
- ---------------------------------------------------------------------------------------------------------
Pro forma income per common share from
continuing operations (A) ................... $ 0.43 $ 0.43
- ---------------------------------------------------------------------------------------------------------
- -------------
See notes to Pro Forma Combined Income Statements.
</TABLE>
<PAGE>
HIBERNIA CORPORATION
NOTES TO PRO FORMA COMBINED INCOME STATEMENT
Six months ended June 30, 1997 and 1996
A. Hibernia expects to achieve savings through reductions in operating
costs in connection with the Merger. The majority of savings will be
achieved through 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. 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.
<PAGE>
<TABLE>
<CAPTION>
HIBERNIA CORPORATION
PRO FORMA COMBINED INCOME STATEMENT
Year ended December 31, 1996
UNICORP PRO FORMA
HIBERNIA BANCSHARES- HIBERNIA
Unaudited ($ in thousands, except per share data) CORPORATION TEXAS, INC. CORPORATION
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Interest income
Interest and fees on loans ................... $ 477,299 $ 5,429 $ 482,728
Interest on securities available for sale .... 138,549 1,737 140,286
Interest on securities held to maturity ...... - - -
Interest on short-term investments ........... 9,780 509 10,289
- ----------------------------------------------------------------------------------------------------------
Total interest income .................... 625,628 7,675 633,303
- ----------------------------------------------------------------------------------------------------------
Interest expense
Interest on deposits ......................... 242,570 2,210 244,780
Interest on short-term borrowings ............ 15,288 - 15,288
Interest on debt ............................. 1,553 152 1,705
- ----------------------------------------------------------------------------------------------------------
Total interest expense ................... 259,411 2,362 261,773
- ----------------------------------------------------------------------------------------------------------
Net interest income .............................. 366,217 5,313 371,530
Provision for possible loan losses ........... (12,625) 48 (12,577)
- ----------------------------------------------------------------------------------------------------------
Net interest income after provision
for possible loan losses ...................... 378,842 5,265 384,107
- ----------------------------------------------------------------------------------------------------------
Noninterest income
Service charges on deposits .................. 58,330 1,200 59,530
Trust fees ................................... 13,397 7 13,404
Other service, collection and exchange charges 33,985 214 34,199
Gain on sale of business lines ............... 517 - 517
Other operating income ....................... 9,436 104 9,540
Securities gains (losses), net ............... (5,306) - (5,306)
- ----------------------------------------------------------------------------------------------------------
Total noninterest income ................. 110,359 1,525 111,884
- ----------------------------------------------------------------------------------------------------------
Noninterest expense
Salaries and employee benefits ............... 161,170 1,897 163,067
Occupancy expense, net ....................... 26,959 523 27,482
Equipment expense ............................ 28,735 194 28,929
Data processing expense ...................... 20,234 307 20,541
Foreclosed property expense, net ............. (1,743) 2 (1,741)
Amortization of intangibles .................. 7,290 105 7,395
Other operating expense ...................... 77,088 666 77,754
- ----------------------------------------------------------------------------------------------------------
Total noninterest expense ................ 319,733 3,694 323,427
- ----------------------------------------------------------------------------------------------------------
Income before income taxes ....................... 169,468 3,096 172,564
Income tax expense ............................... 59,518 995 60,513
- ----------------------------------------------------------------------------------------------------------
Income from continuing operations ................ $ 109,950 $ 2,101 $ 112,051
==========================================================================================================
Income from continuing operations
applicable to common shareholders ............ $ 108,210 $ 2,101 $ 110,311
==========================================================================================================
Pro forma weighted average common shares ......... 126,765,513 2,233,389 128,998,902
==========================================================================================================
Pro forma income per common share from
continuing operations (A) $ 0.85 $ 0.86
==========================================================================================================
- -------------
See notes to Pro Forma Combined Income Statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
HIBERNIA CORPORATION
PRO FORMA COMBINED INCOME STATEMENT
Year ended December 31, 1995
UNICORP PRO FORMA
HIBERNIA BANCSHARES- HIBERNIA
Unaudited ($ in thousands, except per share data) CORPORATION TEXAS, INC. CORPORATION
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Interest income
Interest and fees on loans ................... $ 389,609 $ 3,839 $ 393,448
Interest on securities available for sale .... 49,632 1,680 51,312
Interest on securities held to maturity ...... 116,237 - 116,237
Interest on short-term investments ........... 7,368 246 7,614
- ----------------------------------------------------------------------------------------------------------
Total interest income .................... 562,846 5,765 568,611
- ----------------------------------------------------------------------------------------------------------
Interest expense
Interest on deposits ......................... 226,669 1,757 228,426
Interest on short-term borrowings ............ 13,791 1 13,792
Interest on debt ............................. 1,630 - 1,630
- ----------------------------------------------------------------------------------------------------------
Total interest expense ................... 242,090 1,758 243,848
- ----------------------------------------------------------------------------------------------------------
Net interest income .............................. 320,756 4,007 324,763
Provision for possible loan losses ........... 1,140 185 1,325
- ----------------------------------------------------------------------------------------------------------
Net interest income after provision
for possible loan losses ...................... 319,616 3,822 323,438
- ----------------------------------------------------------------------------------------------------------
Noninterest income
Service charges on deposits .................. 48,715 1,011 49,726
Trust fees ................................... 12,498 8 12,506
Other service, collection and exchange charges 28,673 95 28,768
Gain on divestiture of banking offices ....... 2,361 - 2,361
Gain on sale of business lines ............... 3,402 - 3,402
Other operating income ....................... 8,317 224 8,541
Securities gains (losses), net ............... 248 - 248
- ----------------------------------------------------------------------------------------------------------
Total noninterest income ................. 104,214 1,338 105,552
- ----------------------------------------------------------------------------------------------------------
Noninterest expense
Salaries and employee benefits ............... 136,804 1,388 138,192
Occupancy expense, net ....................... 26,501 194 26,695
Equipment expense ............................ 21,648 90 21,738
Data processing expense ...................... 19,373 238 19,611
Foreclosed property expense, net ............. (699) - (699)
Amortization of intangibles .................. 3,709 - 3,709
Other operating expense ...................... 76,742 735 77,477
- ----------------------------------------------------------------------------------------------------------
Total noninterest expense ................ 284,078 2,645 286,723
- ----------------------------------------------------------------------------------------------------------
Income before income taxes ....................... 139,752 2,515 142,267
Income tax expense ............................... 10,867 801 11,668
- ----------------------------------------------------------------------------------------------------------
Income from continuing operations ................ $ 128,885 $ 1,714 $ 130,599
==========================================================================================================
Income from continuing operations
applicable to common shareholders ............ $ 128,885 $ 1,714 $ 130,599
==========================================================================================================
Pro forma weighted average common shares ......... 126,880,767 2,233,389 129,114,156
==========================================================================================================
Pro forma income per common share from
continuing operations (A) $ 1.02 $ 1.01
==========================================================================================================
- -------------
See notes to Pro Forma Combined Income Statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
PRO FORMA COMBINED INCOME STATEMENT
Year ended December 31, 1994
UNICORP PRO FORMA
HIBERNIA BANCSHARES- HIBERNIA
Unaudited ($ in thousands, except per share data) CORPORATION TEXAS, INC. CORPORATION
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Interest income
Interest and fees on loans ................... $ 307,545 $ 3,325 $ 310,870
Interest on securities available for sale .... 53,134 1,635 54,769
Interest on securities held to maturity ...... 111,325 - 111,325
Interest on short-term investments ........... 7,941 161 8,102
- ----------------------------------------------------------------------------------------------------------
Total interest income .................... 479,945 5,121 485,066
- ----------------------------------------------------------------------------------------------------------
Interest expense
Interest on deposits ......................... 169,633 1,486 171,119
Interest on short-term borrowings ............ 6,225 7 6,232
Interest on debt ............................. 2,971 - 2,971
- ----------------------------------------------------------------------------------------------------------
Total interest expense ................... 178,829 1,493 180,322
- ----------------------------------------------------------------------------------------------------------
Net interest income .............................. 301,116 3,628 304,744
Provision for possible loan losses ........... (17,869) 67 (17,802)
- ----------------------------------------------------------------------------------------------------------
Net interest income after provision
for possible loan losses ...................... 318,985 3,561 322,546
- ----------------------------------------------------------------------------------------------------------
Noninterest income
Service charges on deposits .................. 47,139 880 48,019
Trust fees ................................... 13,092 9 13,101
Other service, collection and exchange charges 22,487 26 22,513
Other operating income ....................... 12,129 48 12,177
Securities gains (losses), net ............... (1,669) (6) (1,675)
- ----------------------------------------------------------------------------------------------------------
Total noninterest income ................. 93,178 957 94,135
- ----------------------------------------------------------------------------------------------------------
Noninterest expense
Salaries and employee benefits ............... 133,002 1,339 134,341
Occupancy expense, net ....................... 28,338 191 28,529
Equipment expense ............................ 17,871 92 17,963
Data processing expense ...................... 21,231 266 21,497
Foreclosed property expense, net ............. (7,064) 13 (7,051)
Amortization of intangibles .................. 23,231 - 23,231
Other operating expense ...................... 86,309 675 86,984
- ----------------------------------------------------------------------------------------------------------
Total noninterest expense ................ 302,918 2,576 305,494
- ----------------------------------------------------------------------------------------------------------
Income before income taxes ....................... 109,245 1,942 111,187
Income tax expense ............................... 7,785 619 8,404
- ----------------------------------------------------------------------------------------------------------
Income from continuing operations ................ $ 101,460 $ 1,323 $ 102,783
==========================================================================================================
Income from continuing operations
applicable to common shareholders ............ $ 101,460 $ 1,323 $ 102,783
==========================================================================================================
Pro forma weighted average common shares ......... 127,595,944 2,233,389 129,829,333
==========================================================================================================
Pro forma income per common share from
continuing operations (A) $ 0.80 $ 0.79
==========================================================================================================
- -------------
See notes to Pro Forma Combined Income Statements.
</TABLE>
<PAGE>
HIBERNIA CORPORATION
NOTES TO PRO FORMA COMBINED INCOME STATEMENT
Years ended December 31, 1996, 1995 and 1994
A. Hibernia expects to achieve savings through reductions in operating
costs in connection with the Merger. The majority of savings will be
achieved through 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. 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 CONCERNING UNICORP
Description of Business
Unicorp was incorporated on July 28, 1980, under the
laws of the state of Texas for the purpose of becoming a
bank holding company, as defined under the BHCA, with
respect to the Bank. Unicorp acquired all of the stock of
the Bank on June 30, 1981. On May 31, 1996, Unicorp
transferred all of the stock of the Bank to UB-Delaware, a
Delaware corporation and wholly-owned subsidiary of Unicorp.
As of June 30, 1997, Unicorp had, on a consolidated basis,
total assets of $115 million, total deposits of $103 million
and total shareholders' equity of $8 million.
Unicorp does not, as an entity, engage in separate
business activities of a material nature apart from the
activities it performs for UB-Delaware and the Bank; it
owns no significant assets other than the stock of UB-
Delaware and indirectly, the stock of the Bank; and it
derives all its revenues from the Bank.
The Bank is a Texas banking association that was
organized on December 31, 1970. The Bank's main facility is
located in Orange, Texas, and the Bank has additional
branches in Orange and Vidor, Texas. The Bank is a full
service commercial bank. The Bank meets its commercial,
industrial and financial customers' banking needs with a
range of financial services. Commercial lending activities
include short-term and medium-term loans, Small Business
Administration loans, revolving credit arrangements,
inventory and accounts receivable financing, equipment
financing and leasing and interim real estate lending.
Other services include cash management programs, federal tax
depository services and night depository services.
The Bank provides a full range of consumer banking
services, including savings and checking accounts, various
savings programs and installment and other personal loans.
It makes automobile and other installment loans directly to
customers, as well as through dealers to whom the Bank may
also provide various forms of "floor plan" financing. The
Bank makes home improvement and real estate loans,
including mortgage loans, and provides safe deposit
services. The Banks offers Master Card and VISA credit
cards to its customers as an agent for another bank. The
Bank has and exercises trust powers.
The business of the Bank is not seasonal in any
material respect, and neither the loans nor the deposits of
the Bank are concentrated in any individual or group that,
if lost, would have a material effect on the business of the
Bank.
On May 31, 1996, Unicorp acquired all of the stock of
Vidor Bancorporation, Inc. ("Vidor"), a Texas corporation
and registered bank holding company, and thereby indirectly
acquired all of the stock of First Texas Bank ("First
Texas"), a Texas banking association and wholly-owed
subsidiary of Vidor. First Texas was subsequently merged
with and into the Bank, and Vidor was dissolved. As a
result of such acquisition, the Bank acquired its branch
office in Vidor, Texas.
Unicorp paid to the shareholders of Vidor a total of
$5,746,000 for the stock in Vidor. In order to finance such
purchase, Unicorp borrowed $3,500,000 from Norwest Bank,
Minnesota, N.A., which indebtedness is secured by a pledge
of the stock of the Bank. The remainder of the
consideration was paid as a result of dividends from the
Bank and First Texas.
Supervision and Regulation
Banking is a complex, highly regulated industry. The
primary goals of the bank regulatory scheme are to maintain
a safe and sound banking system and to facilitate the
conduct of monetary policy.
As bank holding companies under the BHCA, Unicorp and
UB-Delaware are registered with and subject to regulation by
the Federal Reserve Board. Unicorp and UB-Delaware file
annual and other reports with, and furnish information to,
the Federal Reserve, which may make inspections of Unicorp
and UB-Delaware.
The BHCA provides that a bank holding company must
obtain the prior approval of the Federal Reserve for the
acquisition of more than 5% of the voting stock or
substantially all the assets of any bank or bank holding
company. In addition, the BHCA restricts the extension of
credit to any bank holding company by its subsidiary bank.
The BHCA also provides that, with certain exceptions, a bank
holding company may not (i) engage in any activities other
than those of banking or managing or controlling banks and
other authorized subsidiaries or (ii) own or control more
than 5% of the voting shares of any company that is not a
bank. The Federal Reserve has deemed certain limited
activities to be closely related to banking and therefore
permissible activities for a bank holding company. Neither
Unicorp nor UB-Delaware have any intention of engaging in
any such activities at this time.
The Federal Reserve has cease-and-desist powers over
bank holding company and their nonbanking subsidiaries if
their activities constitute a serious threat to the safety,
soundness or stability of a subsidiary bank. Federal
regulatory agencies also have authority to regulate debt
obligations (other than commercial paper) issued by bank
holding companies. This authority includes the power to
impose interest ceilings and reserve requirements on such
debt obligations. A bank holding company and its
subsidiaries are also prohibited from engaging in certain
tie-in arrangements in connection with any extension of
credit, lease or sale of property or furnishing of services.
The Bank is subject to various requirements and
restrictions under the laws of the United States and the
State of Texas, and to regulation, supervision and regular
examination by the FDIC and the Texas Department of Banking.
The Bank is subject to the power of the FDIC to enforce
compliance with applicable banking statutes and regulations.
Such requirements and restrictions include requirements to
maintain adequate capital and reserves against deposits,
restrictions on the nature and amount of loans that may be
made and the interest that may be charged thereon and
restrictions relating to investments and other activities of
the Bank.
The capital classification of a bank affects the
frequency of examinations of the bank, impacts the ability
of the bank to engage in certain activities and affects the
deposit insurance premiums paid by the bank. The Bank's
deposits are insured by the Bank Insurance Fund of the FDIC.
Under applicable law, the FDIC is authorized to assess
insurance premiums on a bank's deposits at a variable rate
depending on the probability that the deposit insurance fund
will incur a loss with respect to the bank. (Under prior
law, the deposit insurance assessment was a flat rate,
regardless of the likelihood of loss.) In this regard, the
FDIC determines the deposit insurance assessment rates on
the basis of the Bank's capital classification and
supervisory evaluations. Each of the categories have three
subcategories, resulting in nine assessment risk
classifications. The three subcategories with respect to
capital are "well capitalized," "adequately capitalized",
"healthy," "supervisory concern" and "substantial
supervisory concern." A bank is deemed "healthy" if it is
financially sound with only a few minor weaknesses. A bank
is deemed subject to "supervisory concern" if it has
weaknesses that, if not corrected, could result in
significant deterioration of the bank and increased risk to
the Bank Insurance Fund. A bank is deemed subject to
"substantial supervisory concern" if it poses a substantial
probability of loss to the Bank Insurance Fund.
THE FOREGOING IS AN ATTEMPT TO SUMMARIZE SOME OF THE
RELEVANT LAWS, RULES AND REGULATIONS GOVERNING BANKS AND
BANK HOLDING COMPANIES, BUT DOES NOT PURPORT TO BE A
COMPLETE SUMMARY OF ALL APPLICABLE LAWS, RULES AND
REGULATIONS GOVERNING BANKS AND BANK HOLDING COMPANIES.
Competition
The activities in which the Bank engages are highly
competitive. the Bank actively competes with other
financial institutions in its efforts to obtain deposits and
make loans, in the scope and type of services offered, in
interest rates paid on time deposits and charged on loans,
and in other aspects of banking. In addition to competing
with other commercial banks within and without its primary
service area, the Bank competes with other financial
institutions engaged in the business of making loans or
accepting deposits, such as savings and loan associations,
credit unions, insurance companies, finance companies,
mortgage loan companies, certain governmental agencies and
other enterprises, certain of which are regulated to a
lesser extent than the Bank, thereby enjoying a competitive
advantage. Additional competition for deposits comes from
government and private issues of debt obligations and other
investment alternatives for depositors, such as money market
funds.
The Bank is faced with competition from banks and other
institutions located in money centers inside and outside
Texas and from foreign banks that maintain representative
offices in Texas. The competition faced by the Bank from
banking organizations outside of Texas has increased in
recent years due to statutes that permit bank holding
companies located outside of Texas to acquire Texas banks,
subject to regulatory approval. Several banks located in
the Bank's market area are now owned and controlled by bank
holding companies located outside of Texas, several of which
have significantly greater resources than the Bank. In
addition, the competition faced by the Bank from banks
located in other areas of the state has increased due to
legal developments resulting in statewide branching rights
for Texas banks. As the result, banks located in Texas can,
subject to regulatory approval, establish branch facilities
near the Bank's banking house and within its market area.
The Bank is uncertain whether any additional branches, if
established, would materially affect the Bank's business.
Employees
The Bank's employees and directors conduct Unicorp's
business, but are not separately compensated as Unicorp
employees. The Bank currently has 61 full-time employees
and 15 part-time employees.
Properties
The Bank's principal offices are located at 302 North
5th Street, Orange, Texas. The main office of the Bank
is located in a two-story building, containing approximately
15,000 square feet with an attached nine-lane drive-in
facility, located on approximately 1.6 acres. The main
office facility is owned by the Bank and is unencumbered.
The Bank has a branch located at 3738 North 16th Street
in Orange, Texas. This branch consists of a 2,000 square foot
facility with a seven-lane drive-in facility, and automated
teller machine. This facility is owned by the Bank and is
unencumbered.
The Bank also has a branch located as 1255 North Main
Street, Vidor, Texas. This branch consists of a 19,000-
square-foot brick building on approximately 3.8 acres. The
building has an attached nine-lane drive-in facility and one
automated teller machine. This branch facility is owned by
the Bank and is unencumbered.
Legal Proceedings
Unicorp and the Bank are involved in various legal
proceedings in the normal course of their business. No such
matters, either singularly or in the aggregate, would have,
in the opinion of their respective management, a material
adverse effect upon the financial condition of Unicorp or
the Bank, if adversely concluded.
Market for the Common Stock and Dividends
Unicorp's authorized capital stock consists of
9,000,000 shares of common stock, par value $1.00 per share,
of which 1,395,868 shares were issued and outstanding as of
the Record Date, and 1,000,000 shares of preferred stock,
par value $1.00 per share, none of which were issued and
outstanding as of the Record Date. There are presently 76
shareholders of record of Unicorp. There is no established
public market for Unicorp Common Stock, nor are there any
published quotations for such shares. Unicorp acts as its
own transfer agent and registrar.
Occasionally, Unicorp becomes aware of trades in
Unicorp Common Stock and the prices at which such trades
were effected. To the knowledge of Unicorp's management,
there have been only two trades of Unicorp Common Stock
since January 1, 1995, involving a total of 658 shares, each
at a price of $4.00 per share. Such price represents actual
trades but may not include all trades that occurred during
such period, and such price is the result of limited trading
and may not representative of the actual fair market value
of Unicorp Common Stock.
Unicorp declared and paid cash dividends of $0.60 per
share and $0.84 per share in 1996 and 1995, respectively,
and declared a paid a cash dividend of $0.30 per share as of
June 30, 1997. The amount of dividends that may be paid by
Unicorp is restricted under the terms of the Agreement,
which provides that the amount of such dividends may not
exceed $0.15 per fiscal quarter for each quarter completed
prior to the Effective Date of the Merger, consistent in
timing with past practices during the preceding three years.
As a bank holding company that does not, as an entity,
engage in separate business activities, Unicorp's ability to
pay cash dividends depends upon the income it receives from
the Bank. Unicorp's only sources of income are (i)
dividends paid to it indirectly by the Bank, and (ii) tax
savings, if any, that result from the filing of consolidated
tax returns for Unicorp and the Bank. Unicorp must pay all
of its operating expenses from the funds received by Unicorp
from the Bank.
The ability of the Bank, as a Texas banking
association, to pay dividends is restricted under applicable
law and regulations. A Texas banking association may not
pay dividends from its stated capital. Additionally, if
losses have been sustained at any time by a bank equal to or
exceeding its undivided profits then on hand, no dividend
can be paid by the bank, and all dividends must be paid out
of net profits then on hand, after deducting expenses,
including losses and provisions for loan losses. The Bank's
payment of dividends is also restricted by federal law.
Dividends may be declared only when and to the extent
justified by sound banking practices. Pursuant to 12 U.S.C.
1818(b), the FDIC has the power to prohibit the payment
of dividends if such payment would constitute an unsafe or
unsound banking practice within the meaning of such section.
The Bank is also subject to certain restrictions on the
payment of dividends as a result of the requirement that is
maintain adequate levels of capital in accordance with
guidelines promulgated from time to time by the FDIC. The
FDIC has issued risk-based capital regulations, which
require banks to maintain minimum capital levels based upon
the relative safety of their assets.
Security Ownership of Principal Shareholders and Management
Ownership of Principal Shareholders
The following table sets forth information concerning
all persons known to Unicorp to be beneficial owners,
directly or indirectly, of more than 5% of the outstanding
shares of Unicorp Common Stock, Unicorp 's only class of
voting securities, as of the Record Date. Unless otherwise
indicated, the named persons have direct beneficial
ownership of the shares with sole voting and investment
power.
Name and Address Amount and Nature
of Beneficial Owner of Beneficial Percent of Class
Ownership
Kenneth Ardis 78,125 5.60%
655 Doty Road
Vidor, Texas 77662
Lin M. Bingham (1) 76,731 5.50%
1602 Inglewood
Orange, Texas 77630
Joseph A. Burke 114,471 8.20%
3738 N. 16th Street
Orange, Texas 77630
Steve Carlton & 71,875 5.15%
Associates Profit
Sharing Fund
805 Henderson
Orange, Texas 77630
Anton Dal Sasso 91,468 6.55%
2100 Sunset Drive
Orange, Texas 77630
Mary Lou Mott 244,202 17.49%
5480 Washington Blvd.
Beaumont, Texas 77707
William G. Oliver (2) 85,102 6.10%
2227 Chasse Bend
Orange, Texas 77632
Lew C. Sheffler 158,952 11.39%
4412 Hillbrook Drive
Orange, Texas 77630
William P. Sterling, 73,115 5.24%
Jr. (3)
3127 N. 16th
Orange, Texas 77630
Carlos R. Vacek (4) 156,585 11.22%
P. O. Box 969
Orange, Texas 77630
(1) Includes 11,962 shares registered in the name
of Mr. Bingham or Vicki L. Bingham (Mr. Bingham's
spouse), over which each of them exercise
sole voting and dispositive power. Also includes
38,269 shares registered in the name of Ornaba &
Co. for the benefit of Mr. Bingham, over which he
exercises sole voting and dispositive power, and
26,500 shares registered in the name of Ornaba &
Co. for the benefit of Vicki L. Bingham, over
which she exercises sole voting and dispositive
power. Ornaba & Co. is the nominee name for the
Bank's Trust Department.
(2) Includes 73,310 shares registered in the name
of Ornaba & Co. for the benefit of Mr. Oliver,
over which he exercises sole voting and
dispositive power. Ornaba & Co. is the nominee
name for the Bank's Trust Department.
(3) Includes 15,250 shares registered in the name
of Mr. Sterling or Dean Sterling (Mr. Sterling's
son) over which each of them exercise sole
voting and dispositive power. Also includes
15,365 shares registered in the name of Mr.
Sterling and Scott Sterling (Mr. Sterling's son)
over which each of them exercise sole
voting and dispositive power. Also includes
12,000 shares registered in the name of Mr.
Sterling or Christopher S. Sterling (Mr.
Sterling's son) over which each of them
exercise sole voting and dispositive power. Also
includes 19,500 shares registered in the name of
Mr. Sterling or Mary Hughes (Mr. Sterling's
sister), over which each of them exercise sole
voting and dispositive power. Also includes
11,000 registered in the name of Mr. Sterling or
Delores Sterling (Mr. Sterling's spouse), over
which each of them exercise sole voting and
dispositive power.
(4) Includes 51,000 shares registered in the name
of Mr. Vacek or Beth Vacek (Mr. Vacek's spouse),
over which each of them exercise sole
voting and dispositive power. Also includes
25,000 shares registered in the name of Mr. Vacek
or Carla Vacek (Mr. Vacek's daughter), over which
each of them exercise sole voting and
dispositive power. Also includes 25,000 shares
registered in the name of Mr. Vacek or Damon Vacek
(Mr. Vacek's son) over which each of them
exercise sole voting and dispositive power. Also
includes 12,000 shares owned individually by Carla
Vacek, over which she exercises sole voting and
dispositive power, and 12,000 shares owned
individually by Damon Vacek, over which he
exercises sole voting and dispositive power. Also
includes 25,577 shares held by Ornaba & Co. for
the benefit of Mr. Vacek, over which he
exercises sole voting and dispositive power, and
1,544 shares held by Ornaba & Co. for the benefit
of Beth Vacek, over which she exercises
sole voting and dispositive power. Ornaba & Co. is
the nominee name for the Bank's Trust Department.
Security Ownership of Management
The following table sets forth information concerning
the shares of Unicorp Common Stock beneficially owned,
directly or indirectly, by each director and executive
officer of Unicorp , and all directors and executive
officers as a group as of the Record Date. Unless otherwise
indicated, the named persons have direct beneficial
ownership of the shares with sole voting and investment
power.
Amount and Nature
Name and Address of Beneficial
of Beneficial Owner Ownership Percent of Class
Lin M. Bingham (1) 76,731 5.50%
Joseph A. Burke (2) 114,471 8.20%
Anton Dal Sasso (3) 91,468 6.55%
Shirley Hall (4) 5,000 *
Michael Lucia, Jr. (5) 62,599 4.48%
Mary Lou Mott (6) 244,202 17.49%
William G. Oliver (7) 85,102 6.10%
Lew C. Sheffler (8) 158,952 11.39%
W. P. Sterling, Jr. (9) 73,115 5.24%
Carlos R. Vacek (10) 156,585 11.22%
Directors and 1,068,185 76.52%
Officers of Unicorp
as a group (10 persons)
* Represents less than 1% of the issued and
outstanding shares of Unicorp Common Stock.
(1) Mr. Bingham serves as Vice President and a
Director of Unicorp. Includes 11,962 shares
registered in the name of Mr. Bingham or Vicki L.
Bingham (Mr. Bingham's spouse), over which
each of them exercise sole voting and dispositive
power. Also includes 38,269 shares registered in
the name of Ornaba & Co. for the benefit of Mr.
Bingham, over which he exercises sole voting and
dispositive power, and 26,500 shares registered in
the name of Ornaba & Co. for the benefit of Vicki
L. Bingham, over which she exercises sole voting
and dispositive power. Ornaba & Co. is the
nominee name for the Bank's Trust Department.
(2) Mr. Burke serves as Chairman of the Board and
a Director of Unicorp.
(3) Mr. Dal Sasso serves as a Director of
Unicorp.
(4) Ms. Hall serves as Secretary and Treasurer of
Unicorp. Shares are registered in the name of
Ornaba & co. for the benefit of Ms. Hall, over
which she exercises sole voting and dispositive
power. Ornaba & Co. is the nominee name for the
Bank's Trust Department.
(5) Mr. Lucia serves as a Director of Unicorp.
Includes 22,197 shares registered in the name of
Cynthia M. Lucia (Mr. Lucia's spouse), over which
she has sole voting and dispositive power,
and 6,666 shares held by Michael M. Lucia, III,
Mr. Lucia's son, over which he has sole
voting and dispositive power. Also includes
10,736 shares registered in the name of Ornaba &
Co. for the benefit of Mr. Lucia, over which he
exercises sole voting and dispositive power, and
802 shares registered in the name of Ornaba & Co.
for the benefit of Cynthia M. Lucia, over which
she exercises sole voting and dispositive power.
Ornaba & Co. is the nominee name for the Bank's
Trust Department.
(6) Ms. Mott serves as a Director of Unicorp.
(7) Mr. Oliver serves as a Director of Unicorp.
Includes 73,310 shares registered in the name of
Ornaba & Co. for the benefit of Mr. Oliver, over
which he exercises sole voting and dispositive
power. Ornaba & Co. is the nominee name for the
Bank's Trust Department.
(8) Mr. Sheffler serves as a Director of Unicorp.
(9) Mr. Sterling serves as Vice President and a
Director of Unicorp. Includes 15,250 shares
registered in the name of Mr. Sterling or Dean
Sterling (Mr. Sterling's son) over which
each of them exercise sole voting and dispositive
power. Also includes 15,365 shares registered in
the name of Mr. Sterling and Scott Sterling (Mr.
Sterling's son) over which each of them
exercise sole voting and dispositive power. Also
includes 12,000 shares registered in the name of
Mr. Sterling or Christopher S. Sterling (Mr.
Sterling's son) over which each of them
exercise sole voting and dispositive power. Also
includes 19,500 shares registered in the name of
Mr. Sterling or Mary Hughes (Mr. Sterling's
sister), over which each of them exercise sole
voting and dispositive power. Also includes
11,000 registered in the name of Mr. Sterling or
Delores Sterling (Mr. Sterling's spouse), over
which each of them exercise sole voting and
dispositive power.
(10) Mr. Vacek serves as President and a Director of
Unicorp. Includes 51,000 shares registered in the
name of Mr. Vacek or Beth Vacek (Mr. Vacek's spouse),
over which each of them exercise sole voting
and dispositive power. Also includes 25,000 shares
registered in the name of Mr. Vacek or Carla Vacek
(Mr. Vacek's daughter), over which each of
them exercise sole voting and dispositive power.
Also includes 25,000 shares registered in the name
of Mr. Vacek or Damon Vacek (Mr. Vacek's son) over
which each of them exercise sole voting and
dispositive power. Also includes 12,000 shares
owned individually by Carla Vacek, over which she
exercises sole voting and dispositive power, and
12,000 shares owned individually by Damon Vacek,
over which he exercises sole voting and dispositive
power. Also includes 25,577 shares held by Ornaba &
Co. for the benefit of Mr. Vacek, over which
he exercises sole voting and dispositive power, and
1,544 shares held by Ornaba & Co. for the benefit of
Beth Vacek, over which she exercises sole
voting and dispositive power. Ornaba & Co. is the
nominee name for the Bank's Trust Department.
<TABLE>
<CAPTION>
Unicorp Banschares-Texas Inc. and Subsidiary
Consolidated Balance Sheet
(Unaudited)
June 30,
- -------------------------------------------------------------------------------------------------
1997 1996
- -------------------------------------------------------------------------------------------------
ASSETS
<S> <C> <C>
Cash and due from banks ............................ $ 8,350,168 $ 6,998,385
Federal funds sold ................................. 550,000 10,325,000
Investment securities available for sale ........... 35,357,337 31,152,207
Loans .............................................. 66,261,714 64,182,369
Less: Unearned discount ....................... (1,499,703) (1,592,010)
Allowance for loan losses ............... (571,209) (594,559)
- -------------------------------------------------------------------------------------------------
NET LOANS ..................................... 64,190,802 61,995,800
Bank premises and equipment - net .................. 2,925,655 2,402,326
Other real estate and assets acquired by foreclosure 134,918 2,500
Interest receivable ................................ 865,762 775,753
Goodwill ........................................... 2,502,666 2,898,077
Deferred federal income tax ........................ - -
Other assets ....................................... 466,984 643,281
- -------------------------------------------------------------------------------------------------
TOTAL ASSETS .................................. $ 115,344,292 $ 117,193,329
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
LIABILITIES AND EQUITY
Non-interest bearing deposits ...................... 33,122,972 33,900,966
Interest bearing deposits .......................... 69,800,614 72,197,333
- -------------------------------------------------------------------------------------------------
TOTAL DEPOSITS ................................ 102,923,586 106,098,299
Note payable ....................................... 3,114,610 3,500,000
Interest payable ................................... 176,971 178,803
Dividend payable ................................... 209,380 209,380
Deferred federal income tax liability .............. 194,945 190,696
Other liabilities .................................. 433,372 227,632
- -------------------------------------------------------------------------------------------------
TOTAL LIABILITIES ............................. 107,052,864 110,404,810
Shareholders' Equity
Capital stock ................................... 1,402,742 1,402,742
Surplus ......................................... 2,787,312 2,787,312
Retained earnings ............................... 3,959,288 2,544,711
Net unrealized gain on investment securities .... 163,265 74,933
Treasury stock .................................. (21,179) (21,179)
- -------------------------------------------------------------------------------------------------
TOTAL SHAREHOLDERS' EQUITY .................... 8,291,428 6,788,519
- -------------------------------------------------------------------------------------------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY ......... $ 115,344,292 $ 117,193,329
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Unicorp Banschares-Texas Inc. and Subsidiary
Consolidated Statement of Income
(unaudited)
June 30
- --------------------------------------------------------------------------------
1997 1996
- --------------------------------------------------------------------------------
<S> <C> <C>
Interest Income
Interest and fees on loans ............. $3,134,124 $2,264,921
Interest on taxable securities ......... 1,075,920 707,829
Interest on non-taxable securities ..... 88,009 66,951
Interest of Federal funds sold ......... 148,022 220,521
- --------------------------------------------------------------------------------
Total interest income ............... 4,446,075 3,260,222
Interest Expense
Interest on Deposits ................... 1,295,407 958,707
Interest on other borrowings ........... 122,856 22,592
- --------------------------------------------------------------------------------
Total interest expense .............. 1,418,263 981,299
NET INTEREST INCOME ....................... 3,027,812 2,278,923
Provision for loan losses .............. 70,000 47,500
NET INTEREST INCOME AFTER ................. 2,957,812 2,231,423
- --------------------------------------------------------------------------------
PROVISION FOR LOAN LOSSES
Other Income:
Service charge on deposits .......... 601,915 438,490
Other income ........................ 248,021 161,253
- --------------------------------------------------------------------------------
849,936 599,743
Other expenses
Salaries and employees benefits ..... 1,137,615 780,427
Net occupancy and equipment expense . 250,745 153,317
Other ............................... 853,490 613,899
Amortization of goodwill ............ 89,916 16,190
- --------------------------------------------------------------------------------
2,331,766 1,563,833
Income before income taxes ................ 1,475,982 1,267,333
Provision for Federal income taxes:
Current provision ................... 464,223 408,069
Deferred provision .................. 8,797 7,659
- --------------------------------------------------------------------------------
Total provision for Federal income taxes 473,020 415,728
- --------------------------------------------------------------------------------
NET INCOME ............................. $1,002,962 $ 851,605
- --------------------------------------------------------------------------------
Per share information:
Net income ............................. $ 0.72 $ 0.61
Cash dividends ......................... $ 0.60 $ 0.60
Shares outstandng ...................... 1,395,868 1,395,868
</TABLE>
<TABLE>
<CAPTION>
UNICORP BANCSHARES-TEXAS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED JUNE 30
1997 1996
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income ........................................................ 1,002,962 851,605
Noncash revenues, expenses, gains and
losses included in income:
Depreciation .............................................. 87,429 53.971
Amortization .............................................. 89,916 16,190
Net amortization of investment premium & discounts ........ (85,030) 28,377
Provisions for loan losses ................................ 70,000 47,500
Loans charged-off, net of recoveries ...................... (64,288) 227,749
Change in prepaid expenses and other assets, net
of change in other accrued liabilities ............... 24,916 (3,475,459)
(Increase) decrease in deferred taxes ..................... (73,946) 226,658
(Increase) decrease in interest earned but not collected .. (194,026) (124,770)
Increase (decrease) in interest accrued but not paid ...... 23,989 94,000
- ----------------------------------------------------------------------------------------------------------------
Net cash flows from operating activities .................. 881,922 (2,054,179)
================================================================================================================
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of bank premises and equipment ........................ (422,221) (1,034,231)
Acquisition of repossessed property ............................... 0 (2,500)
Purchase of investment securities available for sale .............. (13,932,488) (13,185,670)
Sales and maturities of investment securities available for sale .. 9,280,000 4,719,375
Return of principal on investment securities ...................... 1,120,185 1,009,384
Net increase in loans ............................................. (3,805,605) (22,073,279)
Net increase in unearned discount on installment loans ............ 162,981 739,190
Proceeds from sale of repossessed property ........................ 2,500 884
- ----------------------------------------------------------------------------------------------------------------
Net cash provided (used) by investing activities .......... (7,594,648) (29,826,847)
================================================================================================================
CASH FLOWS FROM FINANCING ACTIVITIES
Net Increase (decrease) in non-interest bearing deposits .......... (1,253,245) 17,130,220
Net increase (decrease) in interest bearing deposits .............. (1,253,841) 17,837,320
Cash received on other borrowing .................................. 3,500,000
Principal payments on other borrowings ............................ (196,193) 0
Cash dividends paid ............................................... (418,760) (418,820)
Purchases of treasury stock ....................................... 0 (1,596)
- ----------------------------------------------------------------------------------------------------------------
Net cash provided (used) by financing activities .......... (3,122,039) 38,047,124
- ----------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS ................... (9,834,765) 6,166,098
Cash and cash equivalents at beginning of year .................... 8,900,168 11,157,287
- ----------------------------------------------------------------------------------------------------------------
CASH AND CASH EQUIVALENTS AT END OF YEAR ............................... 18,734,933 17,323,385
================================================================================================================
INTEREST PAID .......................................................... 1418263 981299
================================================================================================================
TAXES PAID ............................................................. 1,071,595 947,523
================================================================================================================
ACQUISITION AND MERGERS (FIRST TEXAS BANK & VIDOR
BANCORPORATION)
Cash and cash equivalents .................... 8,856,848
Investments .................................. 4,823,028
Loans net of discounts and allowances ........ 20,241,337
Bank premises and equipment .................. 991,710
Intangibles and other assets ................. 3,524,759
Deposits assumed ............................. (32,318,463)
Other liabilities assumed .................... (373,259)
- ----------------------------------------------------------------------------------------------------------------
Cash paid to acquire First Texas Bank and
Vidor Bancorporation .................... 5,745,960
================================================================================================================
</TABLE>
<PAGE>
UNICORP BANCSHARES- TEXAS, INC.
Notes to Consolidated Financial Statements
(Unaudited)
Note A - Basis of Presentation
The accompanying unaudited consolidated financial statements for Unicorp
Bancshares have been prepared in accordance with generally accepted accounting
principles for interim financial information. Accordingly, they do not include
all of the information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of management, all
adjustments (consisting of normal recurring accruals) considered necessary for a
fair presentation have been included. Operating results for the six-month period
ended June 30, 1997 are not necessarily indicative of the results that may be
expected for the year ended December 31, 1997. For further information, refer to
the consolidated financial statements and footnotes thereto included in
Unicorp's financial statements for the year ended December 31, 1996 and 1995,
contained elsewhere in this Proxy Statement - Prospectus.
Note B - Merger Agreement
On May 28, 1997, Unicorp and Hibernia entered into an Agreement and Plan of
Merger pursuant to which Unicorp would merge with and into Hibernia. The Merger,
to be accounted for as a pooling of interests, will be affected with the
exchange of approximately $27 million in Hibernia Common Stock for all of the
outstanding Unicorp Common Stock. Each outstanding share of Unicorp Common Stock
(1,395,868 shares outstanding) would be exchanged for 1.6 shares of Hibernia
Common Stock. The Merger is subject, among other things, to receipt of
regulatory and shareholder approval. It is anticipated that the Merger will be
consummated during the fourth quarter of 1997.
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF
UNICORP FOR THE SIX MONTHS ENDED
JUNE 30, 1997 AND JUNE 30, 1996
The following discussion provides certain information concerning the financial
condition and results of operations of Unicorp for the six months ended June 30,
1997 and 1996. The financial position and results of operations of Unicorp
resulted primarily from operations at its banking subsidiary, the Bank.
Management's discussion should be read in conjunction with the Unicorp financial
statements and accompanying notes presented elsewhere in this Proxy
Statement-Prospectus.
Overview
Unicorp reported net income for the six months ended June 30, 1997 of
$1,002,962, an increase of 17.77% from the same period during 1996. This
increase was primarily the result of the acquisition of Vidor with 1997
including six months of Vidor's earnings compared to only one month in 1996.
Annualized returns on average assets and average equity for the six months ended
June 30, 1997 were 1.68% and 25.50% respectively compared with 1.97% and 24.6%
for the same period in 1996.
Unicorp's total assets at June 30, 1997 were $115,344,000, an decrease of
$1,849,000 or 1.58% from June 30, 1996. Interest bearing deposits declined by
$1,955,000 n and non-interest bearing deposits by $1,219,000, primarily at the
Vidor branch, offset by the build up in capital of $1.5 million. The reduction
in customer deposits were funded from excess liquidity invested in Federal Funds
sold.
Results of Operations
Net Interest Income. The major source of Unicorp's revenue is net interest
income. Net interest income is the difference between gross interest on earning
assets (primarily loans and investment securities) and interest paid on deposits
and borrowed funds. Tax equivalent net interest income for the six months ended
June 30, 1997 was $3,079,000, a $739,000 or 31.6% increase from the same period
in 1996, primarily as a result of the acquisition of Vidor.
The following table sets forth certain information concerning the average
balances, interest income (on a fully tax equivalent basis), interest expense,
and average rates on Unicorp's interest-earning assets and interest-bearing
liabilities for the periods indicated. (Dollars in Thousands) :
<TABLE>
<CAPTION>
June 30,
- ------------------------------------------------------------------------------------------------------------
1997 1996
- ------------------------------------------------------------------------------------------------------------
Average Average
Interest Rates Interest Rates
Average Income/ Earned/ Average Income/ Earned/
Balance Expense Paid Balance Expense Paid
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Earning Assets:
Loans (before allowance for
loan losses ................... $ 62,616 $ 3,119 10.03% $ 45,299 $ 2,270 10.02%
Investment Securities: ......... 32,886 1,076 6.54% 21,808 708 6.49%
Taxable securities ............ 3,454 133 7.70% 2,511 101 8.04%
- ------------------------------------------------------------------------------------------------------------
Tax Exempt Securities ......... 36,340 1,209 6.65% 24,319 809 6.65%
Total Investment securities
Federal funds sold & due froms ... 5,975 148 4.95% 8,542 221 5.17%
- ------------------------------------------------------------------------------------------------------------
Total earning assets ............. $104,931 $ 4,496 8.57% $ 78,160 $ 3,300 8.44%
============================================================================================================
Interest-bearing liabilities:
Deposits ....................... $ 72,195 $ 1,295 3.59% $ 55,997 $ 959 3.43%
Notes payable .................. 3,196 122 7.63% 583 22 7.55%
- ------------------------------------------------------------------------------------------------------------
Total interest bearing liabilities $ 75,391 $ 1,417 3.76% $ 56,580 $ 981 3.46%
============================================================================================================
Net interest income .............. $ 3,079 $ 2319
============================================================================================================
Yield on earning assets .......... 5.87% 5.93%
</TABLE>
Net interest income is affected both by the interest rate earned and paid and by
changes in volume, principally in loans, investment securities, deposits and
borrowed funds. The following table sets forth for the periods indicated changes
in tax equivalent net interest income between the six months ended June 30, 1997
and June 30, 1996 for each major category of earning assets and interest bearing
liabilities attributable to changes in average volumes and rates.
<TABLE>
<CAPTION>
CHANGES IN TAX EQUIVALENT NET INTEREST INCOME
(Dollars in Thousands)
Six Months Ended June 30, 1997 Compared with Six Months Ended
June 30, 1996
Increase (Decrease) Due to Change In:
Volume Rate Total
Income earned on:
<S> <C> <C> <C>
Loans ............... $ 868 $ 1 $ 869
Taxable securities .. 360 8 368
Tax-exempt securities 37 (5) 32
Short term investments (66) (7) (73)
- -------------------------------------------------------------------
Total ............ 1,199 (3) 1,196
Interest paid on:
Deposits ............ 272 85 357
Notes payable ....... 99 1 100
- -------------------------------------------------------------------
Total ............ 371 86 457
- -------------------------------------------------------------------
Net interest income .... $ 828 $ (89) $ 739
===================================================================
</TABLE>
Changes not solely due to volume or rate changes are allocated to rate.
Interest Rate Sensitivity. Interest rate risk is the potential impact on net
interest income due to changes in interest rates in any given time frame and the
opportunity to reprice interest earning assets and interest bearing liabilities.
Management uses simulation models to estimate the effect of significant interest
rate changes on net interest income and the fair market value of securities
available for sale. Management may alter the mix of floating and fixed-rate
assets and liabilities, change loan and deposit pricing schedules and adjust
maturities through sales and purchases of securities available for sale as a
means of limiting interest rate risk to an acceptable level.
Provision for Loan Losses. The provision for possible loan losses is the amount
that is added to Unicorp's allowance for loan losses, by a charge against
earnings, in order to maintain a balance in the allowance for loan losses that
is deemed by management to be adequate to absorb the inherent risk of future
loan losses in Unicorp's loan portfolio. The amount of the provision is
dependent upon many factors, including management's evaluation of historical
loan loss experience in relation to outstanding loans, the existing level of the
allowance, reviews of loan quality, loan growth, changes in the composition of
the loan portfolio, general economic factors, the financial condition of the
borrowers, their ability to repay the loan and the value and liquidity of
collateral.
The following table summarizes the changes in the allowance for loan losses for
the periods indicated. (Dollars in Thousands):
<TABLE>
<CAPTION>
June 30,
- ---------------------------------------------------------------
1997 1996
- ---------------------------------------------------------------
<S> <C> <C>
Balance at beginning of period ........ $565 $319
Provision for loan losses ............. 70 48
Loans charged to the allowance ........ 99 46
Recoveries on charged off loans ....... 35 53
Additional reserves through acquisition - 221
- ---------------------------------------------------------------
Balance at end of period .............. $571 $595
- ---------------------------------------------------------------
_______________________________________________________________
</TABLE>
Unicorp's provision for loan losses for the six months ended June 30, 1997 was
$70,000 compared $47,500 for the same period. The allowance for loan losses at
June 30, 1997 was 0.88% of net loans outstanding compared with 0.95% at June 30,
1996.
Non-Interest Income. Income other than from interest-earning assets is derived
primarily from services to customers for which fees are charged. These services
are chiefly deposit services such as account service charges, overdraft and
insufficient funds charges, issuance of cashier's checks and similar services.
Unicorp's non-interest income for the six months ended June 30, 1997 increased
$250,193 or 41.72% from the same period of 1996. This increase was primarily the
result of the acquisition of Vidor, with 1997 including six months of Vidor's
non-interest income compared to only one month in 1996
Non-Interest Expense. Expenses other than those incurred in the connection with
interest-bearing liabilities include, among others, those associated with
personnel, facilities, equipment and supplies, advertising and professional
services. Total non-interest expense for the six months ended June 30, 1997
increased $767,933 or 49.11% from the same period of 1996. This increase is
primarily a result of the additional non-interest expense from the acquisition
of Vidor.
Income Taxes. Unicorp's effective tax rate for the six months ended June 30,
1997 was 32.05% compared to 32.80 % for the same period in 1996.
Financial Condition
Investment Securities. For the period ended June 30, 1997 investment securities
increased $4,174,000 or 13.50% from June 30, 1996. This increase was the result
of moving excess liquidity from Federal Funds sold into investment securities.
The composition, amortized cost and estimated fair value of investment
securities at the dates indicated are as follows. (Dollars in Thousands):
<TABLE>
<CAPTION>
Amortized Estimated
Cost Fair value
- -----------------------------------------------------------------
<S> <C> <C>
As of June 30, 1997:
State and political subdivisions $ 3,691 $ 3,743
Federal agencies ............... 3,415 3,429
Mortgage backed securities ..... 12,004 12,138
U.S. treasuries ................ 126,010 16,049
- -----------------------------------------------------------------
$ 35,120 $ 35,359
- -----------------------------------------------------------------
- -----------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Amortized Estimated
Cost Fair value
- -----------------------------------------------------------------
<S> <C> <C>
As of June 30, 1996:
State and political subdivisions $ 4,236 $ 4,349
Federal agencies ............... 3,857 3,865
Mortgage backed securities ..... 7,649 7,712
U.S. treasuries ................ 15,204 15,226
- -----------------------------------------------------------------
$ 30,946 $ 31,152
- -----------------------------------------------------------------
- -----------------------------------------------------------------
</TABLE>
Loans. Unicorp's loans outstanding for the six months ended June 30, 1997 of
$64,762,000 were up $2,172,000 or 3.50% from the same period in 1996, primarily
as a result of strong demand in real estate loans and consumer installment
loans.
The following table sets forth the type and amount of Unicorp's loans net of
unearned discount at June 30, 1997 and 1996. (Dollars in Thousands):
<TABLE>
<CAPTION>
June 30,
- --------------------------------------------------------------------------------
1997 1996
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Commercial loans ......... $ 7,294 11.21% $ 9,884 15.78%
Real estate loans:
Construction .......... 1,150 1.77% 2,204 3.52%
Mortgage .............. 36,110 55.49% 29,793 47.56%
Installment-consumer loans 19,930 30.62% 20,009 31.94%
other .................... 594 0.91% 759 1.32%
- --------------------------------------------------------------------------------
$65,078 100.00% $62,649 100.00%
- --------------------------------------------------------------------------------
</TABLE>
The following table summarizes non-performing assets for the periods indicated.
(Dollars in Thousands):
<TABLE>
<CAPTION>
June 30,
- --------------------------------------------------------
1997 1996
- --------------------------------------------------------
<S> <C> <C>
Non-performing loans
Non-accrual loans ............ $188 $137
90 day and over past due loans 48 92
- --------------------------------------------------------
Total non-performing loans ... 236 229
Real estate acquired through
foreclosure .................. 135 3
- --------------------------------------------------------
Total non-performing assets ..... $371 $232
- --------------------------------------------------------
- --------------------------------------------------------
</TABLE>
Deposits. Deposits for the six months ended June 30, 1997 were $102,924,000,
a decrease of 2.99% compared to the same period of 1996. The following table
summarizes the period end balance of various deposit categories as of the dates
indicated. (Dollars in Thousands):
<TABLE>
<CAPTION>
June 30,
- ---------------------------------------------------------------
1997 1996
- ---------------------------------------------------------------
<S> <C> <C>
Non-interest-bearing demand $ 31,392 $ 32,611
Interest-bearing demand ... 17,369 18,200
Savings ................... 20,095 22,097
Time deposits ............. 34,068 33,190
- ---------------------------------------------------------------
$102,924 $106,098
- ---------------------------------------------------------------
- ---------------------------------------------------------------
</TABLE>
Non-interest bearing demand deposits totaled $31,392,000 at June 30, 1997, a
decrease of $1,219,000, or 3.73%, in such deposits compared to $32,611,000 at
June 30, 1996. Such decrease was primarily due to a decrease in commercial and
municipal deposits. Interest bearing demand deposits decreased $831,000, or
4.57%, from June 30, 1997, to June 30, 1996, and savings deposits decreased
$2,002,000, or 9.06%, from June 30, 1997, to June 30, 1996. These deposits
primarily decreased as a result of increased competition from the securities
brokerage industry and the strong performance of the U.S. stock market, as
customers invested a greater portion of their savings in equity investments.
Time deposits totaled $34,068,000 at June 30, 1997, an increase of $878,000, or
2.65%, in such deposits compared to $33,190,000 at June 30, 1996. Rates on time
deposits are continuing to experience increase pricing pressure as the banking
industry's loan demand increases causing pressure on funding sources. Unicorp
generally chooses not to compete aggressively for higher priced volatile time
deposits.
Capital Resources. The following table indicates the capital adequacy of the
Bank as compared to the regulatory requirements that were in effect as of
June 30, 1997. (Dollars in Thousands):
<TABLE>
<CAPTION>
June 30, 1997
- --------------------------------------------------------
<S> <C>
Capital:
Tier I capital .............. $ 8,713
Tier II capital
Allowance for loan losses . 571
- ----------------------------------------------------
Total risk -based capital .... $ 9,284
- ----------------------------------------------------
- ----------------------------------------------------
Net risk-weighted assets ........ $ 89,554
Adjusted total assets ........... $ 116,512
Capital ratios
Leverage ratio ............... 7.48%
(Regulatory minimum) ...... 4.00%
Tier I risked-based capital ratio 9.73%
(Regulatory minimum) ...... 4.00%
Total risk-based capital ratio .. 10.37%
(Regulatory minimum) ...... 8.00%
</TABLE>
<PAGE>
UNICORP BANCSHARES - TEXAS, INC.
AND SUBSIDIARIES
FINANCIAL STATEMENTS AND
INDEPENDENT AUDITORS' REPORT
For the Years Ended December 31, 1996 and 1995
<PAGE>
Independent Auditors' Report
To the Board of Directors of
Unicorp Bancshares - Texas, Inc.
and Subsidiaries:
We have audited the accompanying consolidated balance sheets of Unicorp
Bancshares - Texas, Inc. and Subsidiaries as of December 31, 1996 and 1995, and
the related consolidated statements of income, changes in shareholders' equity
and cash flows for the years then ended. The financial statements are the
responsibility of the Unicorp Bancshare - Texas, Inc. and Subsidiaries'
management. Our responsibility is to express an opinion on these consolidated
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 consolidated financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the consolidated 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 Unicorp Bancshares - Texas,
Inc. and Subsidiaries as of December 31, 1996 and 1995, and the results of their
operations and their cash flows for the years then ended, in conformity with
generally accepted accounting principles.
/S Lawerence, Blackburn, Meek, Maxey & Co, P.C.
Beaumont, Texas
March 13, 1997
<PAGE>
<TABLE>
<CAPTION>
UNICORP BANCSHARES - TEXAS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
DECEMBER 31,
1996 1995
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C>
ASSETS
Cash and due from banks ............................................. $ 7,234,933 $ 5,657,287
Federal funds sold .................................................. 11,500,000 5,500,000
- -------------------------------------------------------------------------------------------------------------
Total cash and cash equivalents ............................. 18,734,933 11,157,287
Investment securities available for sale ............................ 31,825,268 23,940,282
Loans ............................................................... 62,456,109 42,109,090
Less: Unearned discount ..................................... (1,336,722) (852,820)
Allowance for loan losses ............................. (565,498) (319,310)
- -------------------------------------------------------------------------------------------------------------
Net loans ................................................... 60,553,889 40,936,960
Bank premises and equipment - net ................................... 2,590,863 1,422,066
Real estate and other assets acquired by foreclosure ................ 2,500 884
Interest receivable ................................................. 671,736 650,983
Goodwill ............................................................ 2,592,582
Federal income tax refundable ....................................... 33,657
Other assets ........................................................ 561,498 43,189
- -------------------------------------------------------------------------------------------------------------
TOTAL ASSETS ................................................ $ 117,533,269 $ 78,185,308
=============================================================================================================
LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES
Non-interest bearing deposits ............................... $ 34,376,217 $ 22,201,035
Interest bearing deposits ................................... 71,054,455 48,929,724
- -------------------------------------------------------------------------------------------------------------
Total deposits ....................................... 105,430,672 71,130,759
Loan payable ................................................ 3,310,803
Interest payable ............................................ 152,982 84,803
Dividend payable ............................................ 209,380 209,440
Deferred tax liability ...................................... 297,880 37,625
Other liabilities ........................................... 368,053 222,389
- -------------------------------------------------------------------------------------------------------------
TOTAL LIABILITIES .................................... 109,769,770 71,685,016
SHAREHOLDERS' EQUITY
Common stock ($1 par; 9,000,000 shares
authorized; 1,402,742 issued) ........................ 1,402,742 1,402,742
Capital surplus ............................................. 2,787,312 2,787,312
Retained earnings ........................................... 3,375,085 2,111,926
Net unrealized gain on investment securities ................ 219,539 217,895
Treasury stock (6,874 and 6,475 shares at cost, respectively) (21,179) (19,583)
- -------------------------------------------------------------------------------------------------------------
TOTAL SHAREHOLDERS' EQUITY ........................... 7,763,499 6,500,292
- -------------------------------------------------------------------------------------------------------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY .................. $ 117,533,269 $ 78,185,308
=============================================================================================================
- -------------
The accompanying notes are an integral part of the financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
UNICORP BANCSHARES - TEXAS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
FOR THE YEARS ENDED DECEMBER 31,
1996 1995
- -------------------------------------------------------------------------------------------------------
<S> <C> <C>
INTEREST INCOME
Interest and fees on loans ................................. $ 6,319,713 $ 3,839,468
Interest on taxable investment securities .................. 1,634,955 1,535,019
Interest on non-taxable investment securities .............. 192,909 144,535
Interest on Federal funds sold and interest earning deposits 622,941 245,706
- -------------------------------------------------------------------------------------------------------
Total interest income ............................... 8,770,518 5,764,728
- -------------------------------------------------------------------------------------------------------
INTEREST EXPENSE
Interest on deposits ....................................... 2,491,264 1,756,857
Interest on other borrowings ............................... 152,235 1,436
- -------------------------------------------------------------------------------------------------------
Total interest expense .............................. 2,643,499 1,758,293
- -------------------------------------------------------------------------------------------------------
NET INTEREST INCOME ........................................ 6,127,019 4,006,435
Provision for loan losses .................................. 86,000 (42,424)
- -------------------------------------------------------------------------------------------------------
NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES .................................. 6,041,019 4,048,859
- -------------------------------------------------------------------------------------------------------
Other income:
Service charges on deposits ......................... 1,406,323 1,011,174
Other income ........................................ 375,259 99,235
- -------------------------------------------------------------------------------------------------------
Total other income ........................... 1,781,582 1,110,409
- -------------------------------------------------------------------------------------------------------
Other expenses:
Salaries and employee benefits ...................... 2,208,998 1,388,042
Net occupancy and equipment expense ................. 814,647 283,572
Other ............................................... 1,306,214 973,153
Loss on sale of securities .......................... 80
- -------------------------------------------------------------------------------------------------------
Total other expenses ......................... 4,329,939 2,644,767
- -------------------------------------------------------------------------------------------------------
NET INCOME BEFORE FEDERAL INCOME TAXES ............................. 3,492,662 2,514,501
- -------------------------------------------------------------------------------------------------------
Provision for Federal income taxes:
Current provision ................................... 978,816 757,883
Deferred provision .................................. 140,721 42,643
- -------------------------------------------------------------------------------------------------------
Total provision for Federal income taxes ................... 1,119,537 800,526
- -------------------------------------------------------------------------------------------------------
NET INCOME BEFORE PURCHASE ADJUSTMENT ...................... 2,373,125 1,713,975
LESS:
NET INCOME FOR THE FIVE MONTHS PRIOR TO THE MERGER
FIRST TEXAS BANK, VIDOR ............................. 272,385
- -------------------------------------------------------------------------------------------------------
NET INCOME AFTER ADJUSTMENT FOR PRE-MERGER INCOME .......... $ 2,100,740 $ 1,713,975
=======================================================================================================
- ------------
The accompanying notes are an integral part of the financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
UNICORP BANCSHARES - TEXAS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
FOR THE YEARS ENDED DECEMBER 31, 1996 AND 1995
Net
Unrealized
Retained Gain (Loss) Total
Capital Capital Earnings on Investment Treasury Shareholders'
Stock Surplus (Deficit) Securities Stock Equity
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
BALANCE AT DECEMBER 31, 1994 ....................... $1,402,742 $2,787,312 $1,570,993 $(446,503) $(18,547) $5,295,997
- ------------------------------------------------------------------------------------------------------------------------------------
Net income ................................. 1,713,975 1,713,975
Dividends .................................. (1,173,042) (1,173,042)
Purchases of treasury stock ................ (1,036) (1,036)
Net unrealized gain on investmentsecurities 664,398 664,398
- ------------------------------------------------------------------------------------------------------------------------------------
BALANCE AT DECEMBER 31, 1995 ....................... $1,402,742 $2,787,312 $2,111,926 $ 217,895 $(19,583) $6,500,292
----------
Net income ................................. 2,100,740 2,100,740
Dividends .................................. (837,581) (837,581)
Purchases of treasury stock ................ (1,596) (1,596)
Net unrealized gain on investment securities 1,644 1,644
- ------------------------------------------------------------------------------------------------------------------------------------
BALANCE AT DECEMBER 31, 1996 ....................... $1,402,742 $2,787,312 $3,375,085 $ 219,539 $(21,179) $7,763,499
----------
====================================================================================================================================
- ----------------
The accompanying notes are an integral part of the financial statements.
</TABLE>
UNICORP BANCSHARES - TEXAS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31,
<TABLE>
<CAPTION>
1996 1995
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income ........................................................... $ 2,100,740 $ 1,713,975
Noncash revenues, expenses, gains and
losses included in income:
Depreciation ........................................... 158,302 91,729
Amortization ........................................... 104,902
Net amortization of investment premium and discounts ... 56,371 94,077
Provisions for loan losses ............................. 86,000 (42,424)
Loans charged-off, net of recoveries ................... 160,188 (299,365)
Change in federal income tax payable ................... (155,201)
Change in prepaid expenses and other assets, net
of change in other accrued liabilities .......... (3,036,532) 303,047
(Increase) decrease in deferred taxes .................. 261,899 42,642
(Gain)/loss on disposal of assets ...................... 753
(Increase) decrease in interest earned but not collected (20,753) (47,072)
Increase (decrease) in interest accrued but not paid ... 68,179 8,109
- --------------------------------------------------------------------------------------------------------------------
Net cash flows from operating activities ...................... (60,704) 1,710,270
- --------------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of bank premises and equipment ........................... (1,327,099) (12,592)
Acquisition of repossessed property .................................. (2,500)
Purchase of investment securities available for sale ................. (22,033,616) (1,973,750)
Sales and maturities of investment securities available for sale ..... 12,254,455 8,755,000
Return of principal on investment securities ......................... 1,837,804 1,129,439
Net increase in loans ................................................ (20,347,019) (5,726,285)
Net increase in unearned discount on installment loans ............... 483,902 1,945
Proceeds from sale of repossessed property ........................... 884
- --------------------------------------------------------------------------------------------------------------------
Net cash provided (used) by investing activities .............. (29,133,189) 2,173,757
- --------------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES
Net increase (decrease) in non-interest bearing deposits ............. $ 12,175,182 $ (1,076,327)
Net increase (decrease) in interest bearing deposits ................. 22,124,731 2,389,900
Cash received on other borrowing ..................................... 3,500,000
Principal payments on other borrowings ............................... (189,197) (65,963)
Cash dividends paid .................................................. (837,581) (1,242,908)
Purchases of treasury stock .......................................... (1,596) (1,036)
- --------------------------------------------------------------------------------------------------------------------
Net cash provided (used) by financing activities .............. 36,771,539 3,666
- --------------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS ......................... 7,577,646 3,887,693
Cash and cash equivalents at beginning of year ....................... 11,157,287 7,269,594
- --------------------------------------------------------------------------------------------------------------------
CASH AND CASH EQUIVALENTS AT END OF YEAR ..................................... $ 18,734,933 $ 11,157,287
====================================================================================================================
INTEREST PAID ................................................................ $ 2,643,717 $ 1,750,444
====================================================================================================================
TAXES PAID ................................................................... $ 1,071,595 $ 947,523
====================================================================================================================
ACQUISITION AND MERGERS (FIRST TEXAS BANK AND VIDOR
BANCORPORATION)
Cash and cash equivalents .................................... $ 8,856,848
Investments .................................................. 4,823,028
Loans net of discounts and allowances ........................ 20,241,337
Bank premises and equipment .................................. 991,710
Intangibles and other assets ................................. 3,524,759
Deposits assumed ............................................. (32,318,463)
Other liabilities assumed .................................... (373,259)
- --------------------------------------------------------------------------------------------------------------------
Cash paid to acquire First Texas Bank and
Vidor Bancorporation .................................... $ 5,745,960
====================================================================================================================
- ----------------
The accompanying notes are an integral part of the financial statements.
</TABLE>
<PAGE>
UNICORP BANCSHARES - TEXAS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 1996 and 1995
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting and reporting policies of the Company conform with
generally accepted accounting principles and to general practices of
the banking industry. Policies and practices which materially affect
the determination of financial position, results of operations and cash
flows are summarized as follows:
Consolidation
Unicorp Bancshares - Texas, Inc. (the Company) and its
subsidiaries, Unicorp Bancshares - Delaware, Inc. and OrangeBank
(the Bank), provide banking services in Orange and Vidor, Texas
and the surrounding area. The accompanying consolidated financial
statements include the accounts of the respective parent company
and its wholly owned subsidiaries. All material intercompany
accounts and transactions have been eliminated in the accompanying
consolidated financial statements.
Investment Securities
For the year ended December 31, 1994, the Company adopted
Statement of Financial Accounting Standards Board No. 115,
"Accounting for Certain Investments in Debt and Equity
Securities." This statement is effective for fiscal years
beginning after December 15, 1993, and addresses the accounting
and reporting for investments in equity securities that have
readily determinable fair values and for all investments in debt
securities.
Those investments are to be classified in three categories and
accounted for as follows:
. Debt securities that the Company has the positive intent
and ability to hold to maturity are classified as
held-to-maturity securities and are reported at amortized
cost.
. Debt and equity securities that are bought and held
principally for the purpose of selling them in the near
term are classified as trading securities and are reported
at fair value, with unrealized gains and losses included
in the earnings.
. Debt and equity securities not classified as either
held-to-maturity securities or trading securities are
classified as available for sale securities and are
reported at fair value, with unrealized gains and losses
excluded from earnings and reported in a separate
component of shareholders' equity, net of tax.
. Realized gains and losses on the sale of investment
securities are based on the net proceeds and the adjusted
book value of the securities sold, using the specific
identification method.
Loans and Allowances for Loan Losses
Loans are stated at the amount of unpaid principal, reduced by
unearned income and an allowance for loan losses. Unearned
income on installment loans is recognized in income over the
terms of the loans in decreasing amounts using a method which
approximates the interest method. Interest on other loans is
calculated by using the simple interest method on daily
balances of the principal amounts outstanding.
The allowance for loan losses and related provision charged to
operating expense are amounts which, in the opinion of
management, are necessary to absorb possible losses on
existing loans on which the collectibility of principal is
unlikely. The amounts are based on consideration of such
factors as; loss experience with particular borrowers,
specific problem loans, quality of the loan portfolio, loan
concentrations and business and economic conditions. The
allowance is based on estimates, and ultimate losses may vary
from the current estimates. Accrual of interest is
discontinued on a loan when management believes, after
considering economic and business conditions and collection
effort, that the borrower's financial condition is such that
collection of interest is doubtful.
Loan Fees and Costs
Loan origination fees and certain direct origination costs
have been recognized immediately as revenues or expenses in
these financial statements. The difference between this method
of accounting and capitalizing these items to be recognized as
an adjustment of loan yield, as required by generally accepted
accounting principles, is considered immaterial by management.
Bank Premises and Equipment
Bank premises and equipment are stated at cost, less
accumulated depreciation. The provision for depreciation is
computed on the straight-line method over the estimated useful
lives of the assets. Estimated useful lives for depreciation
purposes are 10 to 45 years for buildings and 3 to 10 years
for furniture, fixtures and equipment.
Other Real Estate Owned
Real estate acquired by foreclosure is carried at the lower of
the recorded investment in the property or its fair market
value. Prior to foreclosure, the value of the underlying loan
is written down to the fair market value of the real estate to
be acquired by a charge to the allowance for loan losses, if
necessary. Any subsequent write-downs are charged against
operating expenses. Operating expense and related income of
such properties, and gains and losses on their disposition are
included in other income and other expenses.
Income Taxes
The Company adopted the provisions of Statement of Financial
Accounting Standards (SFAS) No. 109 for income tax accounting
for the fiscal year ended December 31, 1993. Prior to the 1993
fiscal year, the Company was accounting for income taxes using
the provisions of Accounting Principles Board (APB) Opinion
No. 11.
SFAS No. 109 requires that income taxes be accounted for by
the asset/liability approach. Deferred taxes represent the
expected future tax consequences when the reported amounts of
assets and liabilities are recovered or paid. They arise from
differences between the financial reporting and tax bases of
assets and liabilities and are adjusted for changes in tax
laws and tax rates when those changes are enacted. The
provision for income taxes represents the total of income
taxes paid or payable for the current year, plus the change in
deferred taxes during the year.
Under SFAS No. 109, deferred tax assets are recognized for
operating loss and other carry forwards (subject to possible
reduction by a valuation allowance) in the year of
origination. Certain of these deferred tax assets were not
immediately recognizable under APB Opinion No. 11, which
required that recognition of operating loss carry forward in
subsequent years be classified as "extraordinary items".
Cash Equivalents
The Company defines cash equivalents for the purposes of
reporting cash flows as cash, amounts due from banks and
federal funds sold.
Trust Assets
Trust assets and other property held by the Company agency or
other fiduciary capacities for its customers are not included
in the financial statements since they are not assets of the
Company.
Goodwill
Goodwill represents the excess of the cost of an acquired Bank
(See Note 16 for information pertaining to the purchase and
mergers of subsidiaries in 1996) over the fair value of its
net assets at the date of acquisition and is being amortized
on the straight-line method over 15 years. Amortization
expense charged to operations was $104,902 for the year ended
December 31, 1996, and is included as a component of other
expenses in the consolidated statement of income.
NOTE 2: RECLASSIFICATIONS
Certain reclassifications have been made to prior year financial
statement items in order to conform to current year presentations.
NOTE 3: ESTIMATES
Preparation of financial statements, in conformity with generally
accepted accounting principles requires the use of management's
estimates. Actual results could differ from those estimates.
NOTE 4: INVESTMENT SECURITIES
As of December 31, 1996, the Company classified all of its
investments as available for sale securities. The amortized cost,
gross unrealized gains/losses, and approximate market values of
investment securities as of December 31, 1996 and 1995, are as
follows:
<TABLE>
<CAPTION>
1996
Gross Gross
Amortized Unrealized Unrealized Market
Cost Gains Losses Value
- -------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
U.S. Treasury .......... $10,923,509 $ 56,610 $ (1,369) $10,978,750
U.S. Government agencies 16,634,427 208,790 (10,060) 16,833,157
Municipal securities ... 3,934,697 80,465 (1,801) 4,013,361
- -------------------------------------------------------------------------------------------
$31,492,633 $ 345,865 $ (13,230) $31,825,268
===========================================================================================
</TABLE>
<TABLE>
<CAPTION>
1995
Gross Gross
Amortized Unrealized Unrealized Market
Cost Gains Losses Value
- --------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
U.S. Treasury .......... $11,039,478 $ 81,959 $ (9,092) $11,112,345
U.S. Government agencies 9,540,177 209,136 (2,986) 9,746,327
Municipal securities ... 3,030,483 54,454 (3,327) 3,081,610
- --------------------------------------------------------------------------------------------
$23,610,138 $ 345,549 $ (15,405) $23,940,282
============================================================================================
</TABLE>
The market values of investment securities are based upon
available market data and estimates, which often reflect
transactions of relatively small size and are not necessarily
indicative of the price at which large amounts of particular
securities could be readily sold.
Investment securities with carrying values totaling $22,076,566
and $18,981,626 at December 31, 1996 and 1995, respectively, were
pledged to secure public deposits as required by federal and state
regulations. Market value of pledged securities totaled
$22,076,566 and $18,981,626 at December 31, 1996 and 1995,
respectively.
Proceeds from sales and maturities of investment securities
available for sale during 1996 and 1995 were $12,254,455 and
$8,755,000, respectively. Gross losses on sales of U.S. Treasury
securities was $80 in 1996. Included in shareholders' equity at
December 31, 1996, is $332,635 of net unrealized gain, net of the
deferred tax effect of $113,096 for a total of $219,539.
The following tables show the maturity distribution of investment
securities included in the investment portfolio at December 31,
1996:
<TABLE>
<CAPTION>
Amortized Cost
- -------------------------------------------------------------------------------------------------------
Within From One to From Five to After Ten
One Year Five Years Ten Years Years Total
<S> <C> <C> <C> <C> <C>
U.S. Treasury ...... $ 5,992,279 $ 4,931,230 $ $ $10,923,509
U.S. Government
agencies ........ 3,229,922 4,624,238 2,827,775 5,952,492 16,634,427
Municipal securities 245,249 1,743,542 1,192,275 753,631 3,934,697
- -------------------------------------------------------------------------------------------------------
$ 9,467,450 $11,299,010 $4,020,050 $ 6,706,123 $31,492,633
=======================================================================================================
</TABLE>
<TABLE>
<CAPTION>
Market Value
- -------------------------------------------------------------------------------------------------------
Within From One to From Five to After Ten
One Year Five Years Ten Years Years Total
<S> <C> <C> <C> <C> <C>
U.S. Treasury ...... $ 6,017,813 $ 4,960,937 $ $ $10,978,750
U.S. Government
agencies ........ 3,233,281 4,641,816 2,859,986 6,098,074 16,833,157
Municipal securities 246,994 1,779,742 1,214,672 771,953 4,013,361
- -------------------------------------------------------------------------------------------------------
$ 9,498,088 $11,382,495 $4,074,658 $ 6,870,027 $31,825,268
=======================================================================================================
</TABLE>
NOTE 5: LOANS AND ALLOWANCE FOR LOAN LOSSES
The loan portfolio consisted of the following classes at December
31, 1996 and 1995:
<TABLE>
<CAPTION>
1996 1995
- -----------------------------------------------------
<S> <C> <C>
Commercial ...... $18,337,910 $13,565,245
Real estate ..... 31,201,039 20,639,466
Installment ..... 12,131,011 7,369,521
Bank card loans 694,274 506,158
Overdrafts ...... 91,875 28,700
- -----------------------------------------------------
$62,456,109 $42,109,090
</TABLE>
The change in the allowance for loan losses is summarized as
follows:
1996 1995
- ---------------------------------------------------------------
Balance at beginning of year .. $ 319,310 $ 433,675
Recoveries .................... 236,758 301,867
Charge-offs ................... (295,481) (373,808)
Allowance acquired in merger .. 218,911
Provision charged to operations 86,000 (42,424)
- ---------------------------------------------------------------
Balance at end of year ........ $ 565,498 $ 319,310
===============================================================
Loans on which the accrual of interest has been discontinued
totaled $229,163 and $24,925 as of December 31, 1996 and 1995,
respectively. If interest on non-accrual loans had been accrued
during the year, such income would have approximated $24,041 and
$1,630 for the years ended December 31, 1996 and 1995,
respectively.
NOTE 6: BANK PREMISES AND EQUIPMENT
Bank premises and equipment are summarized as follows at December
31, 1996 and 1995:
1996 1995
- -------------------------------------------------------------------
Land .......................... $ 1,028,573 $ 548,073
Buildings and branches ........ 2,129,634 1,517,035
Furniture and equipment ....... 1,092,866 896,790
- -------------------------------------------------------------------
Total ...................... 4,251,073 2,961,898
Less: accumulated depreciation (1,660,210) (1,539,832)
- -------------------------------------------------------------------
Net book value ............. $ 2,590,863 $ 1,422,066
===================================================================
Depreciation expense totaled $158,302 and $91,729 for the years
ended December 31, 1996 and 1995, respectively, and is included as
a component of other expense in the consolidated statements of
income.
NOTE 7: TIME DEPOSITS
Included in interest bearing deposits are certificates of deposit
of $100,000 or greater. These certificates and their remaining
maturities at December 31, 1996 and 1995, are as follows:
<TABLE>
<CAPTION>
1996 1995
- -----------------------------------------------------------------------------------
<S> <C> <C>
Three months or less .......................... $4,552,494 $1,268,568
Over three months through twelve months ....... 2,792,680 1,888,826
Over one year ................................. 1,132,752 700,000
- -----------------------------------------------------------------------------------
Total certificates of deposit greater than $100,000 $8,477,926 $3,857,394
===================================================================================
</TABLE>
Interest expense on certificates of deposit of $100,000 or
greater totaled $294,114 and $141,646 for the years ended
December 31, 1996 and 1995, respectively.
NOTE 8: OTHER BORROWINGS AND OTHER LIABILITIES
Other borrowings consisted of the following at December 31, 1996
and 1995:
<TABLE>
<CAPTION>
1996 1995
- ---------------------------------------------------------------------------------------
<S> <C> <C>
Promissory note, dated May 31, 1996, payable to
Norwest Bank Minnesota, N.A. in the amount of
$3,500,000. The interest rate is based on 2.10%
plus the daily Federal Funds Rate quoted to banks
for the offering of dollars for deposit. The
interest rate changes simultaneously with each
change in the Federal Funds Rate. Principal and
interest is due in thirty-one quarterly
installments of $160,000 each, commencing August
31, 1996, with a final payment of all remaining
principal and interest due on May 31, 2004.
Collateral on the note is all the stock of the
Company's subsidiaries, to include OrangeBank. The
loan agreement contains certain covenants
requiring the Company and its bank subsidiary to
maintain certain ratios and performance levels, as
well as restrictions on future borrowing and stock
transactions. Failure to meet the restriction of
the covenants may restrict the Company's payment
of dividends.
$3,310,803
=======================================================================================
</TABLE>
<TABLE>
<CAPTION>
An estimated schedule of maturities of long-term debt is as follows for the
years ending December 31:
<S> <C>
1997 $ 408,018
1998 438,844
1999 471,999
2000 507,659
2001 and beyond 1,484,283
- -------------------------------------
$3,310,803
=====================================
</TABLE>
Other liabilities at December 31, 1996 and 1995, consisted of the
following:
<TABLE>
<CAPTION>
1996 1995
- --------------------------------------------------------------------
<S> <C> <C>
Accounts payable...... $185,426 150,677
Accrued expenses...... 566,448 71,712
- --------------------------------------------------------------------
751,874 222,389
====================================================================
</TABLE>
NOTE 9: COMMITMENTS AND CONTINGENT LIABILITIES
In the normal course of business, the Company makes various
commitments and incurs certain contingent liabilities that are not
presented in the accompanying consolidated financial statements.
The commitments and contingent liabilities include various
guarantees, commitments to extend credit, commitments under credit
card arrangements, commercial letters of credit and standby
letters of credit. At December 31, 1996, commitments under letters
of credit totaled $145,742, commitments to extend credit totaled
$7,340,138, and unused commitments under credit card lines totaled
approximately $1,795,943. At December 31, 1995, commitments under
letters of credit totaled $241,965, commitments to extend credit
totaled $5,423,201, and unused commitments under credit card lines
totaled approximately $986,949. The Company does not anticipate
any material losses as a result of the commitments and contingent
liabilities.
The Company and its subsidiaries are parties 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 consolidated financial position.
NOTE 10: FINANCIAL INSTRUMENTS WITH OFF-BALANCE-SHEET RISK
The Company is party to financial instruments with
off-balance-sheet risk in the normal course of business to meet
the financing needs of its customers. These financial instruments
include commitments to extend credit, commercial and standby
letter of credit, and unused credit card lines. Those instruments
involve, to varying degrees, elements of credit and interest rate
risk in excess of the amount recognized in the statement of
financial position. The contract or notional amounts of those
instruments reflect the extent of involvement the Corporation has
in particular classes of financial instruments.
The Company's exposure to credit loss in the event of
nonperformance by the other party to the financial instrument for
commitments to extend credit and commercial and standby letters of
credit is represented by the contractual notional amount of those
instruments. The Company uses the same credit policies in making
commitments and conditional obligations as it does for
on-balance-sheet instruments.
As of December 31, 1996
Contract Amount
Financial instruments whose contract amounts represent credit
risk:
Commitments to extend credit ............. $7,340,138
Standby letters of credit ................ $ 145,742
Unused commitments under credit card lines $1,795,943
Commitments to extend credit, commercial letters of credit, and
unused credit card agreements contain provisions to lend to a
customer as long as there is no violation of any condition
established in the contract. These commitments generally have
fixed expiration dates or other termination clauses and may
require payment of a fee. Since many of the commitments are
expected to expire without being drawn upon, the total commitment
amounts do not necessarily represent future cash requirements. The
corporation evaluates each customer's creditworthiness on a
case-by-case basis. The amount of collateral obtained if deemed
necessary by the Company upon extension of credit is based on
management's credit evaluation of the counter party. Collateral
held varies but may include accounts receivable, inventory,
property, plant, and equipment, and income-producing commercial
properties.
Standby letters of credit are conditional commitments issued by
the Company to guarantee the performance of a customer to a third
party. The credit risk involved in issuing letters of credit is
essentially the same as that involved in extending loan facilities
to customers. The Company holds OrangeBank certificates of
deposit, accounts receivable, inventory, property and equipment as
collateral supporting those commitments for which collateral is
deemed necessary. All letters of credit outstanding as of December
31, 1996, mature within one year.
NOTE 11: EMPLOYEE BENEFITS
The Company has a defined contribution pension plan covering
substantially all of its employees. Contributions under the plan
are made as required by the plan document which states that the
employer will match up to fifty percent of all employee
contributed amounts that are less than or equal to six percent of
annual compensation. Salaries and employee benefits expense
includes $30,281 in 1996, and $31,708 in 1995, for company
contributions to such plans.
Employees of First Texas Bank were covered by a defined
contribution pension plan until the date of merger with OrangeBank
(See Note 16 for information pertaining to the merger). At that
time, the First Texas Bank plan was terminated and all employee
accounts were rolled-over into the above mentioned plan.
NOTE 12: FEDERAL INCOME TAXES
The consolidated provision for income taxes consisted of the
following for the years ended December 31, 1996 and 1995:
1996 1995
- --------------------------------------------------------------------
Current ...................... $ 978,816 $757,883
Deferred Benefit.............. 140,721 42,643
- --------------------------------------------------------------------
Total ........................ $1,119,537 $800,526
====================================================================
The provision for Federal income tax expense as a percentage of
pre-tax earnings, differs from statutory Federal income tax rate
of 34% as follows:
1996 1995
- --------------------------------------------------------------------
Tax based on statutory tax rate $ 1,187,505 $ 854,931
Tax exempt income effect ...... (72,878) (62,622)
Other ......................... 4,910 8,217
- --------------------------------------------------------------------
Effective tax ................. $ 1,119,537 $ 800,526
====================================================================
NOTE 13: RELATED PARTY TRANSACTIONS
In the ordinary course of business, the Company has loans,
deposits and other transactions with its officers, directors and
businesses with which such persons are associated. It is the
Company's policy that all such transactions are entered into on
substantially the same terms as those prevailing at the time for
comparable transactions with others. The Company had loans to
officers, directors, director-related companies, and employees of
$3,225,187 and $1,367,892 at December 31, 1996 and 1995,
respectively.
NOTE 14: CONCENTRATIONS OF CREDIT
The Company's loans, commitments, and letters of credit have been
granted to customers in the Company's market area. Such customers
primarily are depositors of the Company. Investments in state and
municipal securities also involve entities within the Company's
market area. The concentrations of credit by type of loan are set
forth in Note 5. The distribution of commitments to extend credit
approximates the distribution of loans outstanding.
NOTE 15: LEASES
The Company leases certain equipment under non-cancelable
operating leases. Lease expense for the year ended December 31,
1996, was $4,027. Future minimum lease payments are as follows:
1997 $4,027
1998 4,027
1999 4,027
2000 4,027
2001 671
NOTE 16: PURCHASE AND MERGERS
A merger of OrangeBank, Orange, Texas, ("OrangeBank") and First
Texas Bank, Vidor, Texas ("The Vidor Bank") was completed during
1996. At the beginning of 1996, Orange Bank was a wholly-owned
subsidiary of the Company and The Vidor Bank was a wholly-owned
subsidiary of Vidor Bancorporation (the "Vidor BHC"). On January
24, 1996, the Company and the Vidor BHC entered into an Agreement
and Plan of Reorganization.
The Reorganization Agreement provided for the acquisition by the
Company of all of the common stock of the Vidor BHC (the "Vidor
BHC Stock") through a merger of New Vidor, Inc., a newly-formed
Texas corporation and wholly-owned subsidiary of the Company ("New
Vidor"), with and into the Vidor BHC (the "HC Merger"). To
facilitate the BHC Merger, New Vidor and the Vidor BHC entered
into an Agreement and Plan of Merger (the "BHC Merger Agreement")
on March 1, 1996. The BHC Merger Agreement provided that each
shareholder of the Vidor BHC would receive $30.00 in cash in
exchange for each share of the Vidor BHC Stock that they own,
representing an aggregate payment of $5,745,960, in exchange for
all of the Vidor BHC's issued and outstanding common stock (the
"Merger Consideration").
The total cost of acquiring The Vidor Bank was $5,745,960 which
exceeded the fair value of the net assets of The Vidor Bank by
$2,697,484 recorded as Goodwill (See Note 1). The acquisition has
been recorded as a purchase. The fair value of The Vidor Bank
reflected managements' judgement that adequate reserves had been
set up to cover uncertainties inherent in the acquisition of a new
banking operation.
In connection with the BHC Merger, the Texas BHC borrowed
$3,500,000 from Norwest Bank Minnesota, National Association,
Minneapolis, Minnesota. The Texas BHC obtained the balance of the
funds necessary to pay the Merger Consideration as a result of a
dividend from OrangeBank in the amount of $2,245,960. Immediately
prior to consummation of the BHC Merger, the Company also created
a Delaware intermediate holding company, Unicorp
Bancshares-Delaware, Inc. ("The Delaware BHC"), to own the stock
of OrangeBank. The BHC merger was consummated on May 31, 1996.
As a result of the BHC Merger, New Vidor was dissolved and the
Vidor BHC (as the resulting entity from the BHC Merger) became a
wholly-owned subsidiary of the Company. Immediately after the BHC
Merger, the Vidor BHC transferred all of the stock of The Vidor
Bank to the Company and the Company contributed the stock of The
Vidor Bank to The Delaware BHC. As a result, both The Vidor Bank
and OrangeBank became wholly-owned subsidiaries of The Delaware
BHC. The Vidor BHC was subsequently dissolved.
Immediately following the acquisition of the stock of The Vidor
Bank by the Delaware BHC, The Vidor Bank merged with and into
OrangeBank in an affiliated merger transaction. The Vidor Bank
became a Branch of OrangeBank effective July 15, 1996.
The results of operations for the year ending December 31, 1996,
for The Vidor Bank are included in the accompanying financial
statements. Net results of operations for the five months
proceeding the purchase of The Vidor Bank are shown as an
adjustment to the consolidated net income for the year ending
December 31, 1996.
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF
UNICORP BANCSHARES-TEXAS, INC. FOR THE YEARS ENDED
DECEMBER 31, 1996 AND DECEMBER 31, 1995
The following discussion provides certain information concerning the financial
condition and results of operations of Unicorp for the years ended December 31,
1996 and 1995. The financial position and results of operations of Unicorp
resulted primarily from operations at its banking subsidiary, the Bank.
Management's discussion should be read in conjunction with Unicorp's financial
statements and accompanying notes presented elsewhere in this Proxy
Statement-Prospectus.
Overview
Unicorp reported net income for 1996 of $2,101,000, an increase of $387,000 or
22.57% from net income of $1,714,000 for 1995. Returns on average assets and
average equity for 1996 were 2.06% and 29.59%, respectively, compared with 2.21%
and 27.78% for 1995. Approximately $385,000 of such increase was attributable to
the acquisition of Vidor, resulting in an increase in net income of $519,000,
less the net after tax acquisition expenses for interest and other
organizational cost of $100,000 and $32,000, respectively.
Unicorp's total assets at December 31, 1996 were $117,533,000 an increase of
$39,348,000 or 50.33% from December 31, 1995. Of such increase, $35,626,000 was
attributable to the acquisition of Vidor. Loans increased $19,617,000 from
December 31, 1995 to December 31, 1996, an increase of 48.0%, primarily
attributable to the acquisition of Vidor. Total deposits increased $34,300,000
from December 31, 1995 to December 31, 1996, an increase of 48.2%, with
$30,043,000 of such increase resulting from the acquisition of Vidor and
$3,000,000 of such increase resulting from a temporary increase in public funds
deposits. . Results of Operations
Net Interest Income. The major source of Unicorp's revenue is net interest
income. Net interest income is the difference between gross interest on earning
assets (primarily loans and investment securities) and interest paid on deposits
and borrowed funds. Tax equivalent net income for 1996 was $5,382,000, an
increase of $1,278,000 or 31.14% from 1995. This increase was primarily a result
of Vidor, net of a $151,000 increase in interest expense as a result of the
indebtedness incurred in connection with such acquisition
The following table sets forth certain information concerning the average
balances, interest income (on a fully tax equivalent basis), interest expense,
and average rates on interest-earning assets and interest- bearing liabilities
for the years indicated (Dollars in Thousands).
<TABLE>
<CAPTION>
December 31,
- ---------------------------------------------------------------------------------------------------------------
1996 1995
- ---------------------------------------------------------------------------------------------------------------
Average Average
Interest Rates Interest Rates
Average Income/ Earned/ Average Income/ Earned/
Balance Expense Paid Balance Expense Paid
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Earning assets:
Loans (before allowance for
loan losses) .................. $52,280 $ 5,408 10.34% $38,062 $ 3,858 10.14%
Investment securities:
Taxable securities ............ 28,701 1,576 5.49% 24,934 1,535 6.16%
Tax exempt securities ......... 2,982 250 8.38% 2,985 223 7.47%
- ---------------------------------------------------------------------------------------------------------------
Total investment securities ... 31,683 1,826 5.76% 27,919 1,535 5.50%
Federal funds sold & due froms ... 9,231 509 5.51% 4,151 246 5.93%
- ---------------------------------------------------------------------------------------------------------------
Total earning assets ............. $93,194 $7,744 8.31% $70,132 $5,862 8.36%
===============================================================================================================
Interest-bearing liabilities:
Deposits ....................... $60,385 $2,210 3.66% $48,317 $1,758 3.64%
Notes payable .................. 152 7.56% -
2,011 -
- ---------------------------------------------------------------------------------------------------------------
Total interest bearing liabilities $62,396 $ 2,362 3.79% $48,317 $ 1,758 3.64%
===============================================================================================================
Net interest income .............. $ 5,382 $ 4,104
===============================================================================================================
Yield on earning assets .......... 5.78% 5.85%
</TABLE>
Net interest income is affected both by the interest rate earned and paid and by
changes in volume, principally in loans, investment securities, deposits and
borrowed funds. The following table indicates changes in the tax equivalent net
interest income between 1995 and 1996 for each major category of
interest-earning assets and interest-bearing liabilities attributable to changes
in average volumes and rates.
<TABLE>
<CAPTION>
CHANGES IN TAX EQUIVALENT NET INTEREST INCOME
(Dollars in Thousands)
1996 Compared with 1995
Increase (Decrease) Due to Change In:
Volume Rate Total
Income earned on:
<S> <C> <C> <C>
Loans ................ $1,442 108 $1,550
Taxable securities ... 232 (191) 41
Tax-exempt securities 0 27 27
Short term investments 301 (38) 263
- ----------------------------------------------------------------
Total ............. 1,965 (74) 1,881
Interest paid on:
Deposits ............. 439 13 452
Notes payable ........ 152 0 152
- ----------------------------------------------------------------
Total ............. 591 13 604
- ----------------------------------------------------------------
Net interest income ..... $1,374 (87) $1,277
================================================================
</TABLE>
Changes not solely due to volume or rate changes are allocated to rate.
Interest Rate Sensitivity. Interest rate risk is the potential impact on net
interest income due to changes in interest rates in any given time frame and the
opportunity to reprice interest-earning assets and interest-bearing liabilities.
Management uses a simulation model to estimate the effect of significant
interest rate changes on net interest income and the fair market value of
securities available for sale. Management may alter the mix of floating and
fixed-rate assets and liabilities, change loan and deposit pricing schedules and
adjust maturities through sales and purchases of securities available for sale
as a means of limiting interest rate risk to an acceptable level.
Provision for Loan Losses. Unicorp charges to operating expense an amount
necessary to maintain the balance in the allowance for possible loan losses at a
level that is deemed to be adequate to absorb all expected loan losses.
Management determines the adequacy of its reserve and the amount of any
additional provision or negative provision for possible loan losses based on
many factors, including an evaluation of historical loan loss experience in
relation to outstanding loans, the existing level of the allowance, reviews of
loan quality, loan growth, changes in the composition of the loan portfolio,
general economic factors, the financial condition of the borrowers and their
ability to repay the loan and the value and liquidity of collateral. The amount
in the allowance for possible loan losses is reviewed by management on a monthly
basis to determine whether additional provisions should be made or whether
transfers from the allowance to earnings are justified. Unicorp's board of
directors reviews the adequacy of the reserve on a quarterly basis.
The following table summarizes averages of loan balances, changes in the
allowance for possible loan losses arising from loans charged off and recoveries
on loans previously charged off, by loan category, and the provision for
possible loan losses charged to operating expense as of the dates and the
periods indicated. (Dollars in Thousands):
<TABLE>
<CAPTION>
December 31,
- -------------------------------------------------------------------------
1996 1995
- -------------------------------------------------------------------------
<S> <C> <C>
Average total loans net of discounts .. $62,184 $38,854
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
Beginning balance 319 434
Loans charged off:
Real estate (Mortgage) ............. 0 9
Commercial 68 312
Installment 113 44
- -------------------------------------------------------------------------
Total Charged off 244 374
Recoveries
Loans charged off:
Real estate (Mortgage) 127 280
Commercial 81 12
Installment 11 8
- -------------------------------------------------------------------------
Total recoveries 221 301
Net loans charged off 23 73
Provision for losses 48 (42)
Additional reserves through acquisition 221 0
Ending Balance ........................ $ 565 $ 319
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
Ratio of net charge-offs during period
to average loans outstanding ....... 0.04% 0.19%
</TABLE>
Accordingly, Unicorp had a provision for loan losses of $48,000 for 1996
compared to a negative provision of ($42,000) for 1995. In 1995, Unicorp
received a recovery in the amount of $227,000 on an asset that was charged off
in 1990. At the time of its acquisition, on May 31, 1996, Vidor's allowance for
loan losses was $221,000. At the time of such acquisition, management of Unicorp
estimated that an additional provision for loan losses of $100,000 would be
necessary in order for the allowance for loan losses to be adequate to cover
potential losses in the Vidor loan portfolio. In 1996, however, Unicorp received
$100,000 as a recovery from a real estate participation that had been charged
off in 1990. The allowance for loan loses for 1996 was $565,000 or 0.93% of net
loans outstanding at December 31, 1996. The allowance for loan losses at
December 31, 1995 was $319,000 or 0.78% of net loans outstanding.
Unicorp's allowance for possible loan losses at December 31, 1996 was $565,000
which, in management's opinion, is adequate to cover possible losses in its
current loan portfolio. However, no assurance can be given that future changes
in economic conditions that might adversely affect Unicorp's principal market
area, borrowers or collateral values, and other circumstances will not result in
increased losses in Unicorp's loan portfolio in the future.
Non-Interest Income. Income other than from interest-earning assets is derived
primarily from services to customers for which fees are charged. these services
are chiefly deposit services such as account service charges, overdraft and
insufficient funds charges, issuance of cashier's checks and similar services.
Unicorp's non-interest income for 1996 increased $414,000 or 37.3% from 1995,
primarily as a result of the acquisition of Vidor.
Non-Interest Expense. Expenses other than those incurred in the connection with
interest-bearing liabilities include, among others, those associated with
personnel, facilities, equipment and supplies, advertising and professional
services. Total non-interest expense for 1996 increased $1,049,000 or 39.7% from
1995. As a result of the acquisition of Vidor non-interest expense increased
$1,035,000.
Income Taxes. Unicorp files a consolidated federal income tax return with the
Bank. The Bank pays federal income tax expense to Unicorp based on the taxable
income of the Bank on a stand-alone basis. The effective income tax rate of
Unicorp for 1996 was 32.05% compared to 31.83% for 1995.
Financial Condition
Total Assets. As of December 31, 1996 total assets were $117,533,000, an
increase of $39,348,000 or 50.33% from December 31, 1995. This asset growth is
primarily a result of the acquisition of Vidor which involved $38,540,000 in
assets, including $2,697,000 in goodwill (which is being amortized over 15 years
at $180,000 per year.)
Investment Securities. Unicorp's holding of investment securities serves as a
significant source of total interest income, as well as a source of liquidity to
meet depositor and borrower funding requirements. Unicorp adopted Statement of
Financial Accounting Standards No. 115, "Accounting for Certain Investments and
Debt Securities" ("SFAS 115"), as of January 1, 1994. SFAS 115 addresses the
accounting and reporting for investments in equity securities that have readily
determinable fair value and for all investments in debt securities and requires
classification of securities as trading, available for sale or held to maturity.
Management determines the classification of securities when they are purchased.
At December 31, 1995 and 1996 Unicorp did not have any securities classified
trading or as held for maturity. However, if Unicorp were to purchase securities
in the future with the intent and ability to hold to maturity, they would be
classified as held to maturity and would be stated at cost, adjusted for
amortization of premiums and accretion of discounts. All securities held in the
investment portfolio as of December 31, 1995 and 1996 were classified as
available for sale. These securities may be sold in response to interest rates,
liquidity needs, credit quality or other factors. Such securities are reflected
at fair value, and unrealized gains or losses are reflected as a separate
component of shareholders' equity, net of income tax effects.
The composition of Unicorp's investment portfolio directly reflects Unicorp's
investment strategy of maximizing portfolio yields subject to risk and liquidity
considerations. The composition, amortized cost and estimated fair value of
investment securities at December 31, 1996 and 1995 were as follows: (Dollars in
Thousands )
<TABLE>
<CAPTION>
Amortized Estimated
Cost Fair value
- -------------------------------------------------------------
As of December 31, 1996:
<S> <C> <C>
State and political subdivisions $ 3,934 $ 4,013
Federal agencies ............... 4,879 4,904
Mortgage backed securities ..... 11,755 11,929
Other debt securities .......... 10,924 10,979
- -------------------------------------------------------------
$31,492 $31,825
- -------------------------------------------------------------
- -------------------------------------------------------------
Amortized Estimated
Cost Fair value
- -------------------------------------------------------------
As of December 31, 1995:
State and political subdivisions $ 3,030 $ 3,082
Federal agencies ............... 1,978 1,979
Mortgage backed securities ..... 7,562 7,767
Other debt securities ......... 11,040 11,112
- -------------------------------------------------------------
$23,610 $23,940
- -------------------------------------------------------------
- -------------------------------------------------------------
</TABLE>
The amortized cost and estimated value of debt securities at December 31, 1996,
by contractual maturities, are shown below. Actual maturities will differ from
contractual maturities because borrowers may have the right to call or repay
obligations with or without call or prepayment penalties. (Dollars in Thousands)
<TABLE>
<CAPTION>
Available-for-
Sale Securities
- -------------------------------------------------
Estimated
Amortized Fair
Cost Value
- -------------------------------------------------
<S> <C> <C>
Due in one year
or less .......... $ 9,568 $ 9,600
Due after one year
through five years 8,196 8,310
Due after five years
through ten years 1,973 1,986
due after ten
years ............ - -
- -------------------------------------------------
19,737 19,896
Mortgage-backed
securities ....... 11,755 11,929
- -------------------------------------------------
$31,492 $31,825
- -------------------------------------------------
</TABLE>
Loans. The loan portfolio constitutes the major earning asset of most banks and
typically offers the best alternative for obtaining the maximum interest spread
above the cost of funds. The overall economic strength of any bank generally
parallels the quality and yield of its loan portfolio. Unicorp engages in real
estate lending through real estate mortgage and construction lending, and
commercial and consumer lending. The specific underwriting criteria for each
major loan is outlined in detail in the formal written loan policy and is
approved by the Bank's Board of Directors. Each loan is evaluated on, where
applicable, areas such as the borrowers' character, leverage capacity, capital,
investment in a particular property, if applicable, cashflow, collateral, market
conditions for the borrower's business or project and prevailing economic trends
and conditions. The loan policies of the Bank, including the underwriting
criteria for major categories, are adjusted periodically with each change
approved by the Bank's Board of Directors. New criteria and new policies are the
result of regulatory changes, financial and market conditions and competition in
the Bank's primary market. The Bank's underwriting criteria and loan portfolio
are routinely reviewed by management and external examiners to insure
consistency with bank policy and banking regulations.
The table below sets forth the type and amount of Unicorp's loans, net of
unearned discount, at December 31, 1996 and 1995: (Dollars in Thousands)
<TABLE>
<CAPTION>
December 31,
- ----------------------------------------------------------
1996 1995
- ----------------------------------------------------------
<S> <C> <C>
Commercial loans not secured
by real estate ............. $ 7,228 $ 6,203
Real estate construction loans 2,878 2,098
Real estate mortgage loans ... 33,648 18,761
Installment loans to consumers
not secured by real estate . 16,960 13,690
Other loans .................. 677 504
- ----------------------------------------------------------
$61,391 $41,256
- ----------------------------------------------------------
- ----------------------------------------------------------
</TABLE>
As of December 31, 1996, the Bank had no major concentrations of its loan
portfolio in a particular customer, business or industry classification. Loans
have increased $20,135,000 or 48.8% from December 31, 1995 to December 31, 1996.
Of such growth, $16,269,000 of the growth or 81.8% was in real estate loans, and
$3,458,000 or 17.4% of such growth was in consumer loans. This growth was
primarily a result of the acquisition of Vidor.
The percentage of loans in each category to total loans for each of the periods
indicated is shown below:
<TABLE>
<CAPTION>
December 31,
- -------------------------------------------------------------
1996 1995
- -------------------------------------------------------------
<S> <C> <C>
Real estate loans:
Construction ............. 4.69% 5.09%
Mortgage ................. 54.81% 45.47%
- -------------------------------------------------------------
Total real estate loans 59.50% 50.56%
Commercial loans ............ 11.77% 15.04%
Installment-consumer loans .. 27.63% 33.18%
Other ....................... 1.10% 1.22%
- -------------------------------------------------------------
100.00% 100.00%
- -------------------------------------------------------------
- -------------------------------------------------------------
</TABLE>
The maturity and rate structure of Unicorp's loan portfolio has an impact on
Unicorp's ability to meet its liquidity demands and respond favorably to changes
in interest rates. At December 31, 1996, 28.73% of Unicorp's total loans were
scheduled to mature within one year or less and 17.97% of Unicorp's total loans
had floating or adjustable interest rates. The following table provides
information concerning loan portfolio maturity, based on remaining scheduled
repayments of principal, by type of loan. (Dollars in Thousands)
<TABLE>
<CAPTION>
At December 31, 1996
Maturity or Earliest Reporting
- ---------------------------------------------------------------------
One Year One to Over
Or Less Five Years Five Years Total
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
Fixed rate ... $12,608 $32,135 $ 5,990 $50,733
Variable rate 5,029 3,882 2,121 11,032
- ---------------------------------------------------------------------
- ---------------------------------------------------------------------
Total loans ..... $17,637 $36,017 $ 8,111 $61765
Non-accrual loans $ 228
- ---------------------------------------------------------------------
Total loans (1). $61,993
-----------
-----------
(1) Includes $602 of unearned interest income for Vidor
</TABLE>
Normally borrowers are expected to meet contractual terms in the repayment of
indebtedness. In some cases however, borrowers are permitted to roll over
obligations after appropriate review of the credit quality and determination of
the borrower's ability and willingness to repay.
The data shown above is in a format which conforms with reports to the bank
regulatory agencies and has not been restated to reflect anticipated rollovers,
which management believes would not materially affect the data presented.
Non-accrual, Past Due and Modified Loans. Non-performing assets include
non-performing loans and foreclosed real estate held for sale. Non-performing
loans include loans classified as non-accrual or renegotiated to provide a
reduction or deferral of interest or principal and those past due 90 days or
more on which interest is still being accrued. It is the general policy of
Unicorp to place loans on non-accrual status when, in the opinion of management,
there exists sufficient uncertainty as to the collectibility of the contractual
interest or principal or if the loan becomes 90 days delinquent, whichever comes
first. Placing a loan on a non-accrual status causes an immediate charge against
earnings for the interest which has been accrued but not yet collected on the
loan and eliminates future interest earnings with respect to that loan. Interest
on such loans is not recognized until all of the principal is collected or until
the loan is returned to a performing status. Interest income recognized on
non-accrual loans during 1996 and 1995 was not significant.
As of December 31, 1996, Unicorp had non-performing assets totaling $617,000 or
approximately 1.0% of total loans and foreclosed property at such date compared
with $187,000, or 0.46% at December 31, 1995.
Unicorp's non-performing loans at December 31, 1996, and 1995 are shown below.
(Dollars in Thousands)
<TABLE>
<CAPTION>
December 31,
- ----------------------------------------------------
1996 1995
- ----------------------------------------------------
<S> <C> <C>
Loans accounted for on a
non-accrual basis ......... $228 $ 25
Loans which are contractually
past due 90 or more days .. 257 4
Loans, the terms of which have
been renogotiated ......... 132 158
- ----------------------------------------------------
Total non-performing loans ... $617 $187
- ----------------------------------------------------
- ----------------------------------------------------
</TABLE>
The increase in non-performing loans of $430,000 was primarily attributable to
the acquisition of non-performing loans in Vidor's loan portfolio.
Unicorp's management is not aware of any loans classified for regulatory
purposes and excluded from the above table which represent or result from trends
or uncertainties that will materially impact future operating results,
liquidity, or capital resources, or represent material credits about which
management is aware of any information which causes doubts as to the ability of
such borrowers to comply with the loan repayment terms.
Deposits and Other Liabilities. Unicorp's average total deposits increased from
$70,765,000 in 1995 to $85,675,000 in 1996. This increase is mainly a result of
the of deposits acquired from Vidor. Unicorp does not rely on any brokered
deposits. The following table summarizes the amounts of average deposits and
average rates for the period indicated: (Dollars in Thousands):
<TABLE>
<CAPTION>
December 31,
- ----------------------------------------------------------------------
1996 1995
Amount Rate Amount Rate
- ----------------------------------------------------------------------
<S> <C> <C> <C> <C>
Non-interest bearing
demand deposits ... $29,786 0.00% $23,460 0.00%
Interest-bearing money
market/now deposits 17,428 2.80% 15,136 3.03%
Savings deposits ..... 12,144 3.10% 10,037 2.82%
Time deposits ........ 26,317 5.15% 22,132 4.58%
- ----------------------------------------------------------------------
Total average deposits $85,675 2.60% $70,765 2.48%
------- -------
------- -------
</TABLE>
Occasionally, Unicorp may have liabilities in the form of borrowed funds, which
generally consist of a line of credit with Texas Commerce Bank to purchase
federal funds. This line is secured with the pledge of securities held in the
investment portfolio. As of December 31, 1996 and 1995 Unicorp did not have any
liabilities resulting from the purchase of federal funds. Unicorp generally only
purchases Federal funds in order to meet short term liquidity needs.
In connection with the acquisition of Vidor, Unicorp incurred $3,500,000 in
long-term indebtedness with Norwest Bank Minnesota, N.A. Interest on such
indebtedness computed at the daily Federal Funds rate plus 2.10%. Principal and
interest is due in thirty-one quarterly installments of $160,000 each,
commencing August 31, 1996, with a final payment of all remaining principal and
interest due on May 31, 2004. Collateral on the note is all the stock of
Unicorp's subsidiaries, including the Bank. The loan agreement contains certain
covenants requiring the Unicorp and the Bank to maintain certain ratios and
performance levels, as well as restrictions on future borrowing and stock
transactions. Failure to meet the restriction of the convenants may restrict
Unicorp's payment of dividends.
Liquidity and Interest Rate Sensitivity Management. The primary functions of
asset and liability management are to assure adequate liquidity and to maintain
an appropriate balance between interest-earning and interest-bearing
liabilities. Liquidity represents the Bank's ability to meet the daily demand
for funds from its customers to pay maturing deposits, honor checks and drafts,
extend credit and meet other commitments. Management monitors liquidity
requirements as warranted by interest rate trends, changes in the economy,
changes in the scheduled maturities, and interest rate sensitivity of the
investment and loan portfolios as well as deposits. The Bank attempts to match
rate-sensitive assets and liabilities in order to minimize exposure from
fluctuations in interest rates and to enhance consistent growth of net interest
income through periods of changing interest rates.
The asset portion of the balance sheet provides liquidity primarily through cash
and due from banks, loan principal repayments, and cash flows from investment
securities, federal funds sold and investment securities available for sale.
The liability portion of the balance sheet provides liquidity through various
interest and non-interest-bearing deposit accounts and federal funds purchased.
Long-standing relationships with many institutions have provided the Bank with
the opportunity to buy and sell federal funds on a daily basis.
The Bank's liquidity, which is monitored by the Board and Executive Committee,
is deemed by management to be adequate to meet all foreseen business demands.
Capital Resources. The Bank 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 sheet items are included,
such as loan commitments and standby letters of credit. Capital is separated
into two categories, Tier 1 and Tier 2, which combine for Total Capital. Tier 1
consists of common shareholders' equity and perpetual preferred stock, subject
to certain limitations. Tier 2 capital consists of the reserve for loan losses
and subordinated debt, subject to certain limitations. In order to be considered
adequately capitalized, the guidelines provide for minimum Total Risk-Based
Capital of 8.0%, half of which must be Tier 1 capital.
In conjunction with the risk-based capital guidelines, the regulatory agencies
have also issued leverage capital guidelines. The leverage ratio consists of
Tier 1 capital as a percent of average total assets. In order to be considered
adequately capitalized, the minimum leverage ratio for banks must equal at least
4 percent.
Using year end financial data, the following table indicates the capital
adequacy of the Bank as of the dates indicated compared to the regulatory
requirements that were in effect at such dates (Dollars in Thousands):
<TABLE>
<CAPTION>
1996 1995
- ----------------------------------------------------------------------
<S> <C> <C>
Capital:
Tier 1 capital ............... $ 8,204 $ 6,246
Tier II capital
Allowance for loan losses . 565 319
- ----------------------------------------------------------------------
Total risk -based capital .... 8,769 6,565
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Net risk-weighted assets ........ $ 82,097 $ 56,333
Adjusted total assets ........... $ 113,312 $ 77,584
Capital ratios
Leverage ratio ............... 7.24% 8.05%
(Regulatory minimum) ...... 4.00% 4.00%
Tier I risked-based capital ratio 9.99% 11.09%
(Regulatory minimum) ...... 4.00% 4.00%
Total risk-based capital ratio .. 10.68% 11.65%
(Regulatory minimum) ...... 8.00% 8.00%
</TABLE>
RELATIONSHIP WITH INDEPENDENT AUDITORS
Lawrence, Blackburn, Meek, Maxey & Co., independent au
ditors, has continuously served as the independent auditor for
Unicorp from 1991 through the present. A representative of
Lawrence, Blackburn, Meek, Maxey & Co. is expected to be present
at the Special Meeting, will have an opportunity to make a
statement if he desires and will be available to respond to
appropriate questions.
VALIDITY OF SHARES
The validity of the shares of Common Stock offered hereby
has been passed upon for Hibernia by Patricia C. Meringer,
Corporate Counsel and Secretary of Hibernia. As of the date of
this Proxy Statement-Prospectus, Ms. Meringer owned 3,536 shares
of Hibernia Common Stock and held options to purchase shares of
Hibernia Common Stock of which options to acquire 18,037 shares
are currently exercisable.
EXPERTS
The consolidated financial statements of Hibernia
incorporated by reference in Hibernia's Annual Report (Form 10-
K) for the year ended December 31, 1996 have been audited by
Ernst & Young LLP, independent auditors, as set forth in their
report thereon incorporated by reference therein and incorporated
herein by reference. Such consolidated financial statements are
incorporated herein by reference in reliance upon such report
given upon the authority of such firm as experts in accounting
and auditing.
The consolidated financial statements of Unicorp at December
31, 1996 and 1995, and for each of the two years in the period
ended December 31, 1996, included in this Proxy Statement-
Prospectus have been audited by Lawrence, Blackburn, Meek, Maxey
& Co., independent auditors, as set forth in their report
appearing elsewhere herein, and are included in reliance upon
such report given upon the authority of such firm as experts in
accounting and auditing.
APPENDICES
APPENDIX A
AMENDED AND RESTATED
AGREEMENT AND PLAN OF MERGER
OF
UNICORP BANCSHARES TEXAS, INC.
WITH AND INTO
HIBERNIA CORPORATION
THIS AMENDED AND RESTATED AGREEMENT AND PLAN OF MERGER,
effective as of May 28, 1997 (this "Agreement"), adopted and made
by and between Unicorp Bancshares Texas, Inc., ("Unicorp"),
and Hibernia Corporation ("Hibernia").
Unicorp is a corporation duly organized, validly existing
and in good standing under the laws of the State of Texas
and has its registered office at 302 N. 5th St., Orange,
Texas 77630-5707; is a bank holding company within the meaning of
the Bank Holding Company Act of 1956, as amended (the "Bank
Holding Company Act"); and owns all of the issued and outstanding
shares of capital stock of Unicorp Banchsshares-Delaware, Inc.
("UB-Delaware"). The presently authorized capital stock of Unicorp
consists solely of 9,000,000 shares of common stock of the par
value of $1.00 each ("Unicorp Common Stock") and 1,000,000 shares
of preferred stock, par value $1.00 per share (the "Unicorp
Preferred Stock"). As of March 31, 1997, 1,402,742 shares of
Unicorp Common Stock had been issued, 1,395,868 shares of
Unicorp Common Stock were outstanding, and 6,874 shares of Unicorp
Common Stock were held in Unicorp's treasury, and no shares of
Unicorp Preferred Stock were issued and outstanding. All
outstanding shares of Unicorp Common Stock have been duly
issued and are validly outstanding, fully paid and nonassessable.
The foregoing are the only voting securities of Unicorp authorized,
issued, or outstanding. There are no existing stock options,
warrants, calls, or commitments of any kind obligating Unicorp 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 Unicorp's capital
stock has been issued in violation of preemptive rights of
shareholders. Unicorp indirectly owns 100 percent of the
outstanding capital stock of OrangeBank (the
"Bank"), a Texas banking corporation duly organized, validly existing
and in good standing under the laws of the state of Texas.
The Bank is (i) is an "insured bank" as defined in the Federal
Deposit Insurance Act and applicable regulations thereunder, and
(ii) has full authority to conduct its business as and where currently
conducted.
UB-Delaware is a corporation duly organized, validly
existing and in good standing under the laws of the State of
Delaware and directly owns all of the issued and outstanding
shares of capital stock of the Bank. The presently authorized
capital stock of UB-Delaware consists solely of 1,000
shares of common stock of the par value of $1.00 each, and, as
of March 31, 1997, 1,000 shares of such common stock had
been issued, and were outstanding and owned directly by Unicorp,
with no shares held in treasury. All outstanding shares of UB-Delaware's
common stock have been duly issued and are validly outstanding,
fully paid and nonassessable. The foregoing are the only voting
securities of UB-Delaware authorized, issued, or outstanding. There are
no existing stock options, warrants, calls, or commitments of any
kind obligating Unicorp to issue any shares of its capital stock
or any other security of which it is or will be the issuer. None
of the shares of UB-Delaware's capital stock has been issued in
violation of preemptive rights of shareholders.
Hibernia is a corporation duly organized, validly
existing and in good standing 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") and Hibernia National Bank of
Texas ("HNBT"). 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 March 31, 1997, 2,000,000 shares of Hibernia's preferred
stock were issued and outstanding, 128,940,436 shares of Hibernia
Common Stock were outstanding, and 62,137 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 shares
of its capital stock or any other security of which it is or will
be the issuer, except that Hibernia has authorized or reserved
1,968,750 shares of Hibernia Common Stock for issuance under its
1987 Stock Option Plan, pursuant to which options covering
1,496,800 shares of Hibernia Common Stock were outstanding as of
the date hereof; 7,880,703 (as adjusted) shares of Hibernia
Common Stock for issuance under its 1992 Long-Term Incentive
Plan, pursuant to which options covering 6,263,264 shares of
Hibernia Common Stock were outstanding as of the date hereof;
1,000,000 shares of Hibernia Common Stock for issuance under its
1993 Director Stock Option Plan, pursuant to which options
covering 248,750 shares of Hibernia Common Stock are outstanding
on the date hereof; 144,780 shares of Hibernia Common Stock are
available for issuance pursuant to Hibernia's Dividend
Reinvestment and Stock Purchase Plan; and warrants covering
213,176 shares of Hibernia Common Stock are outstanding 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 duly organized,
validly existing and in good standing under the laws of the
United States of America having its principal registered office
at 313 Carondelet Street, New Orleans, Louisiana 70130.
HNBT is a national banking association duly organized,
validly existing and in good standing under the laws of the
United States of America and having its principal office at
100 W. Broad Street, Texarkana, Texas 75501. All of the
issued and outstanding shares of capital stock of HNB and HNBT
are owned by Hibernia. HNB and HNBT (i) are "insured banks" as
defined in the Federal Deposit Insurance Act and applicable
regulations thereunder, and (ii) have full authority to conduct
their businesses as and where currently conducted.
The Boards of Directors of Unicorp and Hibernia have duly
approved this Agreement and have authorized the execution hereof
by Unicorp's President and Hibernia's President and Chief Executive
Officer, respectively. Unicorp has directed that this Agreement be
submitted to a vote of its shareholders in accordance with Texas
law 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 Unicorp 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), Unicorp shall be merged with and into
Hibernia under the Articles of Incorporation of Hibernia,
pursuant to the provisions of, and with the effect provided in,
(i) Part XI of the Louisiana Business Corporation Law ("LBCL")
and (ii) Section 5.01 through 5.04 of the Texas Business
Corporation Act ("TBCA") (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. Unicorp Common Stock.
3.1. Conversion. On the Effective Date and subject to
the provisions of Section 3.7 hereof,
(a) each share of Unicorp Common Stock issued and
outstanding immediately prior to the Effective Date
other than (i) shares which are held by shareholders who have not
voted such shares in favor of the Merger and who shall have
delivered a written demand for payment of the fair value of such
shares within the time and manner provided in Article 5.12 of the
TBCA (unless such holder shall have failed to perfect or shall
have effectively withdrawn or lost his right to appraisal and
payment under the TCBA), 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
Unicorp 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
Unicorp;
(c) each share of Unicorp Common Stock held in the
treasury of Unicorp or owned beneficially by Hibernia or any of
its subsidiaries shall be canceled; 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 Unicorp 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 Market Price
(as defined in Section 3.8 hereof), and no such holder shall be
entitled to dividends, voting rights or any other rights 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 Unicorp 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
Unicorp 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 Unicorp 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 or until Hibernia has issued or caused to be
issued certificates of Hibernia Common Stock for his Old
Certificates that have been lost, stolen or destroyed. 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; provided, however, that former shareholders
of Unicorp shall not be entitled to receive any dividend on their
Hibernia Common Stock with respect to any period for which
Unicorp paid a dividend prior to the Effective Date.
3.5. Cancellation of Old Certificates. On and after
the Effective Date there shall be no transfers on the stock
transfer books of Unicorp or Hibernia of the shares of Unicorp
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
canceled 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 Unicorp 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 Texas
law, the officers and directors of Unicorp 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 Hibernia title to, and possession of, all
the property, interests, assets, rights, privileges, immunities,
powers, franchises, and authorities of Unicorp, and otherwise to
carry out the purposes of this Agreement.
3.7. Dissenters' Shares. Shares of Unicorp Common
Stock held by any holder having rights of a dissenting
shareholder as provided in Texas law, 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 Texas law, 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 Unicorp Common Stock,
at which time such shares shall be converted as provided in
Section 3.1 hereof.
3.8. Exchange Rate.
(a) The Exchange Rate shall be 1.6 shares of Hibernia
Common Stock for each outstanding share of Unicorp Common Stock.
(b) For purposes of this Agreement, the term " Average Market
Price" shall mean the average of the closing price of one share
of Hibernia Common Stock (adjusted as set forth in Section 9.8 of
this Agreement, if an adjustment is required by that section) for the
ten business days preceding the last trading day immediately prior to
the Closing Date as reported in The Wall Street Journal.
4. Articles of Incorporation; By-Laws. The Articles of
Incorporation and By-Laws 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 By-Laws of
Hibernia, respectively, unless altered, amended or repealed in
accordance with applicable law.
5. Employees. Hibernia shall cause to be provided as soon
as practicable after the Effective Date for the employees of
Unicorp and the Bank 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 Unicorp or the Bank (or both)
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 Unicorp or
the Bank shall be deemed equivalent to having been employed for
that same period by Hibernia and/or its subsidiaries (and
employees of Unicorp and the Bank will not be denied health
insurance coverage solely as a result of a preexisting condition
that existed on the Effective Date but did not exist on the date
the employee commenced his or her employment with Unicorp or the
Bank) and provided further, however, that if Hibernia determines
in good faith that it cannot merge any benefit plan of Unicorp
into a comparable benefit plan of Hibernia or HNB or HNBT without
creating material potential liability for Hibernia's or HNB's or
HNBT's plan, then Hibernia shall be entitled to freeze the
existing benefit plan of Unicorp and prohibit participation by
former employees of Unicorp in Hibernia's plan for the period of
time required by applicable law to ensure that Hibernia's and
HNB's and HNBT's benefit plans are not deemed to be successor
plans of the Unicorp plan in question.
6. Negative Covenants. From the date hereof until the
Effective Date, or until the termination of this Agreement,
Unicorp covenants and agrees that it will not do, or agree to
commit to do, and Unicorp will cause the Bank not to do and not
to agree or commit to do, without the prior written consent of
Hibernia, any of the following:
(a) in the case of Unicorp (and not the Bank), 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 Unicorp Common Stock
(other than in a fiduciary capacity); provided, however, that
Unicorp may make, declare, set aside and pay regularly or
specially declared dividends not to exceed $0.15 per share of
Unicorp Common Stock per fiscal quarter for each quarter
completed prior to the Effective Date, consistent in timing with
past practices during the preceding three years.
(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 pay or agree to pay any bonus to,
any of its directors, officers or employees, except in accordance
with the terms of any employment agreement existing on the date
hereof or in accordance with past practices during the preceding
three years; provided that Hibernia hereby consents to the
payment on the Closing Date of the pro rata portion of annual
bonuses accrued on the books of the Bank through the Closing
Date, provided that such accruals are consistent in timing and
amount with accruals made for bonuses during the preceding three
years and that such bonuses are paid in the ordinary course of
business;
(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;
(e) other than as contemplated in this Agreement, (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 Incorporation or
Association or By-Laws, (iii) impose, or suffer the imposition,
on any share of stock held by Unicorp in the Bank, of any
material lien, charge, or encumbrance, or permit any such lien to
exist, other than as described on Schedule 7.3, (iv) establish or
add any automatic teller machines or branch or other banking
offices in addition to those listed on schedule 6(e) hereto,
(v) make any capital expenditures in excess of $50,000 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 Unicorp's ability to
perform its covenants and agreements hereunder;
(f) except as otherwise provided herein, liquidate;
sell or dispose of any asset other than in the ordinary course of
business consistent with past practices; 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,
Unicorp, UB-Delaware or the Bank or any business combination with
Unicorp, UB-Delaware or the Bank other than as contemplated by
this Agreement, and Unicorp and the Bank shall instruct each
officer, director, agent or affiliate of it to refrain from doing
any of the above, and Unicorp will notify Hibernia promptly if
any such inquiries or proposals are received by, and such
information is requested from, or any such negotiations or
discussions are sought to be initiated with, Unicorp, UB-Delaware
or the Bank; provided, however, that nothing contained in this
section shall be deemed to prohibit any officer or director of
Unicorp or the Bank from taking any action that, in the written
opinion of counsel to Unicorp or the Bank, is required by applicable
law or is necessary to discharge properly the fiduciary duties of
such officer oro director; 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 Unicorp. Unicorp
(and not its directors or officers in their personal capacities)
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. Each of Unicorp
and the Bank has the corporate power authority to carry on its
business as it is now being conducted and to own, lease and
operate its assets, properties and business; and Unicorp has
all requisite power and authority to execute and deliver this
Agreement and perform its obligations hereunder.
7.3. Ownership of Other Banks. Unicorp 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 except the Bank and
UB-Delaware. The presently authorized capital stock of the
Bank consists solely of 600,000 shares of common stock
of the par value of $2.50 each, all of which shares of
common stock are outstanding. The outstanding shares of capital
stock of the Bank are validly issued and outstanding, fully paid
and nonassessable and, except as provided on Schedule 7.3 hereto,
all of such shares are owned by UB-Delaware, free and clear of all
liens, claims and encumbrances.
7.4. Corporate Authorization. The execution, delivery
and performance of this Agreement have been authorized by
Unicorp's Board of Directors, and, subject to the approval of
this Agreement by its shareholders in accordance with the
applicable Texas law and 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 Unicorp of this Agreement
and the consummation of the Merger have been validly and
appropriately taken. Subject to such shareholder approval and to
the regulatory and other approvals required by Section 12 hereof,
this Agreement is a legal, valid and binding obligation of Unicorp,
enforceable against Unicorp 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 Texas 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 Unicorp
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 Unicorp or the Bank or to which
Unicorp or the Bank 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 Unicorp and the Bank taken as a whole or on the
transactions contemplated hereby, (ii) to the best of the
knowledge of Unicorp's officers, 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 Unicorp or the Bank or to
which Unicorp or the Bank is subject, or (iii) a breach or
violation of, or a default under, the Articles of Incorporation
or By-Laws of Unicorp or the Bank; 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. The parties hereto expressly
acknowledge and agree that the existence of one or more contracts
to which Unicorp or the Bank is a part that include a general
prohibition against assignment without prior consent, shall not
result in a breach of the final clause of the preceding sentence
for purposes of this Agreement.
7.6. Financial Statements; Dividend Restrictions.
Unicorp 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
"Unicorp Financial Statements"): Unicorp's Consolidated Balance
Sheets as of March 31, 1997 and 1996 (unaudited) and December 31,
1996, 1995 and 1994 (audited); Consolidated Statements of Income
and Changes in Stockholders' Equity and Consolidated Statements
of Cash Flows for the years ended December 31, 1996, 1995 and
1994 (audited), and Consolidated Statements of Income for the
three-month periods ended March 31, 1997 and 1996 (unaudited).
Each of the Unicorp Financial Statements (including the related
notes) fairly presents the consolidated results of operations of
Unicorp and the Bank for the respective periods covered thereby
and the consolidated financial condition of Unicorp and the Bank
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
generally accepted accounting principles ("GAAP")
consistently applied during the periods involved, except as may
be noted therein. Except as disclosed in the Unicorp 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 Texas
corporations or state banks generally) precluding Unicorp or the
Bank from paying dividends, in each case when, as and if declared
by its Board of Directors.
7.7. No Material Adverse Change. Since March 31, 1997,
there has been no event or condition of any character (whether
actual, or to the knowledge of officers of Unicorp or
the Bank, threatened or contemplated) that has had or can
reasonably be anticipated to have, or that, if concluded or
sustained adversely to Unicorp, would reasonably be anticipated
to have, a material adverse effect on the financial condition,
results of operations, business or prospects of Unicorp or the
Bank, 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
Unicorp that in the opinion of its officers is likely to have a
material and adverse effect on the business, results of
operations or financial condition of Unicorp and the Bank taken
as a whole, and, to the best of its knowledge of its
officers, no such litigation, proceeding or controversy
has been threatened or is contemplated. Except as disclosed on
Schedule 7.8 hereto, no member of Unicorp'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, neither Unicorp nor the Bank is bound by
any material contract to be performed after the date hereof that
is not terminable by Unicorp or the Bank without penalty or
liability on thirty days prior notice.
7.10. Brokers' or Finders' Fees. Neither Unicorp
nor the Bank has entered into an agreement with any agent,
broker, investment banker, investment or financial advisor or
other person acting on behalf of Unicorp or the Bank relating to
any commission, broker's or finder's fee in connection with any
of the transactions contemplated by this Agreement except Service
Asset Management Co. Inc., a copy of which
agreement with Unicorp is attached hereto as Exhibit 7.10.
7.11. Contingent Liabilities. Except as disclosed
on Schedule 7.11 hereto or as reflected in the Unicorp Financial
Statements and except in the case of the Bank for unfunded loan
commitments made in the ordinary course of business consistent
with past practices, as of March 31, 1997, neither Unicorp nor
the Bank has any obligation or liability (contingent or
otherwise) that was material, or that when combined with all
similar obligations or liabilities would have been material, to
Unicorp and the Bank taken as a whole and there does not exist a
set of circumstances resulting from transactions effected or
events occurring prior to, on, or after March 31, 1997, or from
any action omitted to be taken during such period that, to the
knowledge of officers of Unicorp, 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 Unicorp 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. Other than as set
forth on Schedule 7.13 hereto, since March 31, 1997, neither
Unicorp nor the Bank has incurred or paid any obligation or
liability that would be material to Unicorp 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 Unicorp or the Bank 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, 1994, and all returns filed are complete and
accurate to the best knowledge of their respective officers;
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 Unicorp or the Bank except as reserved against in the
Unicorp Financial Statements. All taxes, interest, additions
and penalties due with respect to completed and settled
examinations or concluded litigation have been paid, and
Unicorp's reserves for bad debts at December 31, 1994, 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 knowledge of its officers,
each loan reflected as an asset of Unicorp in the Unicorp
Financial Statements, as of March 31, 1997, or acquired
since that date, is the legal, valid, and binding obligation
of the obligor named therein, enforceable in accordance with
its terms, except as enforceability may be limited by
bankruptcy, reorganization, insolvency, fraudulent conveyance
and laws and court decisions relating to or affecting the
enforcement of creditors' rights generally and general
equitable principles or similar legal principles; provided,
however, that an inability to collect all or any part of such
loan (other than a loan required to have been classified as
substandard or doubtful as of March 31, 1997 that was not so
classified to the extent of any loss in such loan) shall not be
deemed to be a breach of this representation; and no loan is
subject to any asserted defense, offset or counterclaim known to
Unicorp, except as disclosed in writing to Hibernia on or prior
to the date hereof.
7.16. Allowance for Loan Losses. To the
knowledge of Unicorp's officers, allowances for possible loan
losses shown on the balance sheets of Unicorp as of March 31, 1997
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 March 31, 1997, and each such
allowance has been established in accordance with GAAP.
7.17. Title to Assets; Adequate Insurance Coverage.
(a) Except as set forth on Schedule 7.3 hereto,
as of March 31, 1997, Unicorp and the Bank 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 Unicorp 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 Unicorp Financial Statements or which secure
deposits of public funds as required by law; (ii) liens for taxes
accrued but not yet payable; (iii) liens arising as a matter of
law in the ordinary course of business with respect to
obligations incurred after March 31, 1997, 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; (v) capital leases and leases, if any, to
third parties for fair and adequate consideration and (vi)
securities pledged for interest rate swap, cap and floor
contracts. Unicorp and the Bank own, or have 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 Unicorp or
the Bank 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
Unicorp or the Bank is a party, except for financing leases in
which Unicorp or the Bank 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) Neither Unicorp nor the Bank has any 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 of its
officers, the policies of fire, theft, liability and
other insurance maintained with respect to the assets or
businesses of Unicorp and the Bank provide adequate coverage
against loss and the fidelity bonds in effect as to which Unicorp
or the Bank is named insured provide adequate coverage with
respect to amounts, types and risks involved.
7.18. Employee Plans. To the knowledge of Unicorp's
officers, 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
Unicorp or the Bank, and Unicorp and the Bank, with respect to
such plans:
(I) are 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) have 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
Unicorp is not subject to any agreement with any such
governmental authority with respect to any such plan.
7.19. Copies of Employee Plans. On or prior to the
date hereof, Unicorp has provided Hibernia with 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 or the Bank for its or the Bank's
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,
neither Unicorp nor the Bank has any 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. Neither Unicorp nor the Bank is
in default in any material respect under any material 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, Unicorp
has made available to Hibernia, for inspection pursuant to the
terms of Section 9.5 hereof, the minutes of meetings of
Unicorp's and the Bank's Board of Directors and all committees
thereof held during the period beginning June 30, 1991 and prior
to the date hereof, which minutes are complete and correct in all
material respects and fairly present the deliberations and
actions of such Boards and committees.
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 insurance) ) maintained by Unicorp or
the Bank at the date hereof. Except as disclosed on Schedule
7.23 hereto, neither Unicorp nor the Bank has 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,
neither Unicorp nor the Bank has 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 Unicorp or the Bank.
7.24. Investments. Except for securities pledged
for interest rate swap, cap and floor contracts and pledged to
secure public trust deposits, none of the investments reflected
in the Unicorp Financial Statements under the heading "Investment
Securities," and none of the investments made by Unicorp or the
Bank since March 31, 1997, and none of the assets reflected in
the Unicorp 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 Unicorp or
the Bank freely to dispose of such investment at any time. With
respect to all repurchase agreements to which Unicorp or the Bank
is a party, Unicorp or the Bank, as the case may be, 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. Except as disclosed
on Schedule 7.25 hereto, neither Unicorp nor the Bank at any time
since December 31, 1989, nor, to the knowledge of
officers of Unicorp and the Bank, (i) Unicorp or the
Bank prior to December 31, 1989, or (ii) 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
Unicorp or the Bank or used by Unicorp or the Bank in their
respective business ("Unicorp Properties"), used, generated,
treated, stored, or disposed of any hazardous waste, toxic
substance, or similar materials on, under, or about Unicorp
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"). Since December 31, 1989, neither Unicorp nor the Bank
has 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
Unicorp Properties. Notwithstanding anything in this Section
7.25 to the contrary, the parties hereto expressly agree that
Unicorp shall not be in breach of this representation if any of
the foregoing representations in this Section 7.25 are
are inaccurate solely as a result of, or due to, circumstances
relating to one or more properties as to which Unicorp's sole
interest is or was as mortgagee or holder of a security interest.
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. Each of Hibernia
and its material subsidiaries 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, HNB,
and HNBT are validly issued and outstanding, fully paid and
nonassessable (subject, in the case of HNB and HNBT, 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 its subsidiaries or by
which Hibernia or any of its subsidiaries 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 its subsidiaries taken as a
whole or on the transactions contemplated hereby, (ii) to the
best of the best 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 its
subsidiaries or to which Hibernia or any of its subsidiaries is
subject, or (iii) a breach or violation of, or a default under
the Articles of Incorporation or Association or By-Laws of
Hibernia or of its subsidiaries 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, 1996, its Quarterly Report on Form 10-Q for
the period ended March 31, 1997, and its proxy statement for its
1997 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 March 31, 1997 (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 its
subsidiaries, 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 Unicorp on or before the date hereof.
8.7. No Material Adverse Change. Since March 31, 1997,
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, HNB, or HNBT excluding changes
in laws or regulations that affecting banking institutions
generally.
8.8. Certain Litigation and Proceedings. Except as
listed on Schedule 8.8 hereto, to the knowledge of management of
Hibernia, no litigation, proceeding or controversy has been
threatened or is contemplated before any court or governmental
agency that, in the opinion of Hibernia's executive officers is
likely to have a material adverse effect on the business, results
of operations or finnaancial condition of Hibernia, taken as a
whole.
8.9. Brokers' or Finders' Fees. No agent, broker,
investment banker, investment or financial advisor or other
person acting on behalf of Hibernia or under its 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 Hibernia has engaged
First Capital Group, L. L. C. ("FCG") in connection with the
Merger.
9. Agreements and Covenants. Hibernia and Unicorp 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 after October 2,
1997 (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 nothing contained in this section shall
be deemed to prohibit any officer or director of Unicorp or the
Bank from taking any action that, in the written opinion of
counsel to Unicorp or the Bank, is required by applicable law or
is necessary to discharge properly the fiduciary duties of such
officer or director.
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 Unicorp relating to Unicorp, (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 Unicorp 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 and Unicorp in advance, neither party
will 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 Unicorp so long as Unicorp 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 Unicorp access to such
information as it may reasonably deem necessary to perform its
due diligence review with respect to Hibernia and its assets in
connection with the Merger, Hibernia shall (and shall cause HNB
and HNBT to), (A) upon reasonable notice, afford Unicorp 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 Unicorp and such representatives with
such financial and operating data and other information of any
kind respecting its business and properties as Unicorp shall from
time to time reasonably request to perform such review, (B)
furnish Unicorp with copies of all reports filed by Hibernia with
the SEC throughout the period after the date hereof prior to the
Effective Date promptly after such reports are so filed, and (C)
promptly advise Unicorp 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 Unicorp to be
acquired as a result of the Merger, Unicorp 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, and to the
extent consistent with applicable law, access 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 Unicorp 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. Affiliates. Prior to the Closing Date (as defined
in Section 14 hereof), Unicorp shall deliver to Hibernia a letter
identifying all persons whom it believes to be "affiliates" of
Unicorp for purposes of Rule 145(c) or Rule 144 (as applicable)
under the 1933 Act ("Affiliates"). Unicorp 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 9.6 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 Unicorp 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.
9.7. 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 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.
9.8. 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.
9.9. 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), Unicorp shall, and it
shall cause the Bank to, 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 Unicorp or the Bank 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 Unicorp herein.
9.10. Indemnification of Directors and Officers of
Unicorp and the Bank.
(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 Unicorp or the Bank, (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
Unicorp, or the Bank to the same extent as he would have been
indemnified under the Articles of Incorporation and/or By-Laws of
Hibernia, as such documents were in effect on the date of this
Agreement as if he were an officer or director of Hibernia at all
relevant times. For a period of three (3) years after the
Effective Date, Hibernia will continue Unicorp's and the Bank's
directors' and officers' liability insurance coverage with
respect to actions occurring prior to the Closing Date to the
extent that such coverage is obtainable for an aggregate premium
not to exceed the annual premium presently being paid by Unicorp
and the Bank that will be refunded by the insurance carrier upon
termination of Unicorp's existing policy. If the premium of such
portion of the insurance would exceed such maximum amount,
Hibernia shall procure such level of insurance as can be obtained
for a premium equal to such maximum amount.
(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, HNB, or
HNBT.
(c) The rights to indemnification granted by this
subsection 9.10 are subject to the following limitations: (i)
the total aggregate indemnification to be provided by Hibernia
pursuant to subsection 9.10(a) shall not exceed, as to all of the
Indemnified Persons as a group, the sum of $5,000,000 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 9.10 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 9.10 hereto; and (iii) amounts otherwise required to be
paid by Hibernia to an Indemnified Person pursuant to this
subsection 9.10 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 $5,000,000
indemnification limit set forth in paragraph (c) of this Section
9.10 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.
9.11. 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.
9.12. Cooperation in Rule 144 Transfers. Hibernia
will use its best efforts to file in a timely manner all reports
to be filed pursuant to the Securities Exchange Act of 1934, as
amended, or the rules and regulations promulgated thereunder, so
as to continue the availability of Rules 144 and 145(d) of the
General Rules and Regulations of the Securities Act of 1933, as
amended, for sales of shares of Hibernia Common Stock received
pursuant to the Merger by former shareholders of Unicorp.
10. Permits, Consents and Approvals. As promptly as
practicable after the date hereof:
(a) Hibernia shall submit an application to the Board
of Governors of the Federal Reserve System (the "Federal Reserve
Board") for approval of the transactions contemplated hereby in
accordance with the provisions of the Bank Holding Company Act;
(b) Hibernia shall submit an application to any other
regulatory authority whose approval of the transactions
contemplated hereby is required;
(c) Unicorp shall endeavor to have its Affiliates
execute a written agreement in substantially the form of Exhibit
9.6 hereto; provided, however, that Unicorp shall have no such
obligation prior to the receipt by the Board of Directors of
Unicorp of the Fairness Opinion; and
(d) Unicorp shall endeavor to have each of the
directors of Unicorp and the Bank execute an Agreement in
substantially the form of Exhibit 10(d) hereto; provided,
however, that Unicorp shall have no such obligation prior to the
receipt by the Board of Directors of Unicorp 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
Unicorp 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 Unicorp shall, promptly upon request by the other
party, either destroy or return any documents so obtained. The
parties hereto expressly acknowledge and agree that the terms of
this Section 11.1 shall supersede any prior agreements relating
to the confidentiality of information received by the parties
hereto from each other, specifically the terms of the
confidentiality agreement dated as of April 24, 1997 between
Unicorp and Hibernia.
11.2. Hold Harmless. Hibernia will indemnify and
hold harmless Unicorp, each of its directors and officers and
each person, if any, who controls Unicorp or the Bank 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 Unicorp or the Bank 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 Unicorp
and exercise and perfection of dissenters' rights pursuant to
Texas law by holders of Unicorp Common Stock holding in the
aggregate no more than 10% of the Unicorp Common Stock
outstanding on the Closing Date.
12.2. Federal Reserve Board and Other Approvals.
Procurement by Hibernia of the approval of the Federal Reserve
Board and any other regulatory authorities whose approval is
required by law or regulation 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 Unicorp 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. Unicorp and its
directors shall have received an opinion, dated the Closing Date,
of counsel for Hibernia, in form and substance reasonably
satisfactory to Unicorp, as to such matters as Unicorp may
reasonably request with respect to the transactions contemplated
hereby.
12.6. Opinion of Unicorp Counsel. Hibernia, its
directors and its officers who sign the Registration Statement
shall have received an opinion, dated the Closing Date, of
Jenkiens & Gilchrist, for Unicorp, in form and substance
reasonably 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
Unicorp. Each of the representations, warranties, and agreements
of Unicorp 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
President of Unicorp, dated the Closing Date, to such effect;
Unicorp 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. Unicorp 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
Unicorp 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
Unicorp such other certificates as Unicorp 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 Unicorp with such
further documents or other materials as Unicorp 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 Unicorp 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. Tax Opinion. Hibernia shall have received an
opinion of a nationally recognized public accounting firm
satisfactory to Unicorp, which opinion shall be satisfactory in
form and substance to Hibernia and Unicorp, to the effect that
(i) 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, (ii) the
exchange of Unicorp Common Stock to the extent exchanged for
Hibernia Common Stock will not give rise to gain or loss to the
shareholders of Unicorp with respect to such exchange, (iii) the
basis of Hibernia Common Stock to be received by the holders of
Unicorp Common Stock will be, in each instance, the same as the
basis of their stock surrendered in exchange therefor, decreased
by the amount of cash received, if any, and increased by the
amount of gain, if any, recognized in the exchange, and (iv)
the holding period of the Hibernia Common Stock to be received
by the holders of Unicorp Common Stock in the transaction will
include in each instance the period during which the Unicorp
Common Stock surrendered in exchange therefor is held as a capital
asset on the date of the surrender. Unicorp shall have received
a copy of such opinion, which shall permit Unicorp and its
shareholders to rely on it.
12.11. Listing on New York Stock Exchange. The
shares of Hibernia Common Stock issuable to the holders of
Unicorp 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.
12.12. Fairness Opinion. Unicorp shall have
received a letter from FCG 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 consideration to be paid to Unicorp
shareholders under the terms of the Merger is fair to Unicorp's
shareholders from a financial point of view (the "Fairness
Opinion").
12.13. Indebtedness of Unicorp. At the Effective
Date, the total amount of indebtedness of Unicorp that would be
reflected on a parent-only balance sheet of Unicorp, prepared in
accordance with GAAP, shall not exceed $3,100,000.
12.14. Employment Arrangement. As of the Effective
Date, Hibernia and/or HNBT shall have entered into an employment
agreement with Carlos R. Vacek having a term of 3 years and
including salary, bonus and other provisions mutually acceptable
to Mr. Vacek and Hibernia, and with Lin M. Bingham having a term
of 2 years and including salary, bonus and other provisions
mutually agreeable to Mr. Bingham and Hibernia.
12.15. Assertion of Conditions. A failure to
satisfy any of the requirements set forth in Section 12.5, 12.8
or 12.11 shall only constitute conditions to consummation of the
Merger if asserted by Unicorp and a failure to satisfy any of the
requirements set forth in Section 12.6 or, 12.7 or 12.13 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 March 31, 1998, or (ii) any
condition to Closing cannot be satisfied by March 31, 1998 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 Federal Reserve Board,
the Federal Reserve Bank or any other regulatory authority whose
approval is required by law or regulation 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 Unicorp.
13.6. Dissenters. By Hibernia, if holders of more
than 10 percent of the outstanding Unicorp Common Stock exercise
statutory rights of dissent and appraisal pursuant to Texas law.
13.7. Material Adverse Change. By Unicorp, 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 in good
faith, that the Merger does not qualify as a pooling-of-interests
for accounting purposes.
13.9. Fairness Opinion. By Unicorp, if it shall
not have received a letter from FCG dated within five
days of the scheduled date of mailing of its 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
Unicorp from a financial point of view, or if such letter is
withdrawn before the Closing.
13.10. Due Diligence. By Hibernia, within 30 days
after the date hereof, if its due diligence review of Unicorp
results in a discloses material liabilities, obstacles to the
Merger or other circumstances that are not disclosed in this
Agreement or the Schedules hereto and that, in the good faith
judgment of Hibernia, materially alter the economic basis for, or
feasibliility of, the Merger; provided, however, that the sole
remedy that Hibernia shall have in that event pursuant to this
Section 13.10 shall be the termination of this Agreement.
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)October 2, 1997; (ii)
the date that falls 15 days after the date of the order of the
Federal Reserve Board approving the Merger pursuant to the Bank
Holding Company Act; and (iii) 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 (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 (i) the Secretary of State of the
State of Louisiana for filing pursuant to and in accordance
with the provisions of Section 12:112 of the LBCL and (ii) the
Secretary of State of the State of Texas for filing pursuant to
and in accordance with Section 5.05 of the TBCA. The Merger shall
become effective as of the date and time of issuance by both
Secretaries of State 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, 9.10, 9.12, 11 and 15 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 Unicorp 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 9.10 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 9.10
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 Unicorp) 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
Unicorp shall change the number of shares of Hibernia Common
Stock into which shares of Unicorp 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:
Hibernia National Bank
313 Carondelet Street
New Orleans, Louisiana 70130
Attention: Corporate Law Division
and a copy of all notices or other communications directed to
Unicorp shall be sent to:
Brian R. Marek
Jenkens & Gilchrist
Suite 3200
1445 Ross Avenue
Dallas, Texas 75202-2799
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.
[The remainder of this page has been left intentionally blank.]
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
By: Stephen A. Hansel
President and Chief Executive Officer
Attest:
/s/ PATRICIA C. MERINGER
Patricia C. Meringer
Secretary
UNICORP BANCSHARES-TEXAS, INC.
/s/ CARLOS R. VACEK
By: Carlos R. Vacek
President
Attest:
/s/ SHIRLEY HALL
Shirley Hall
Secretary and Treasurer
APPENDIX B
OPINION OF FIRST CAPITAL GROUP, L.L.C.
August 14, 1997
Board of Directors
Unicorp Bancshares--Texas, Inc.
302 N. 5th Street
Orange, Texas 77630
Members of the Board:
You have requested our opinion as to the fairness, from a
financial point of view, to the holders of the outstanding shares
of common stock of Unicorp Bancshares--Texas, Inc. ("Unicorp"),
of the consideration (the "Merger Consideration") to be received
by such holders pursuant to the Agreement and Plan of Merger
dated as of May 28, 1997 (the "Merger Agreement"), which provides
for the merger (the "Merger") of Unicorp with and into Hibernia
Corporation ("HIB"). Pursuant to section 3.8 of the Merger
Agreement, each shareholder of the outstanding common stock of
Unicorp (the "Unicorp Common Stock") has a right to receive 1.6
shares of common stock of HIB (the "HIB Common Stock") for each
share of Unicorp Common Stock tendered. The terms and guidelines
of the transaction are more fully set forth in the Merger
Agreement.
In connection with our opinion, we have: (i) analyzed certain
publicly available financial statements, both audited and
unaudited, and other information of Unicorp and HIB, including
those included in Unicorp's financial statements as of and for
the year ended December 31, 1996 and HIB's Annual Reports for the
three years ended December 31, 1996, HIB's Quarterly Report for
the period ended March 31, and June 30, 1997, and Unicorp's
financial statements as of and for the periods ended March 31,
and June 30, 1997; (ii) analyzed certain internal financial
statements and other financial and operating data concerning
Unicorp prepared by the management of Unicorp; (iii) analyzed
certain financial projections of Unicorp prepared by the
management of Unicorp; (iv) discussed certain aspects of the past
and current business operations, financial condition and future
prospects of Unicorp with certain members of its management; (v)
reviewed reported market prices and historical trading activity
of the HIB Common Stock; (vi) compared the financial performance
of HIB and the prices and trading activity of the HIB Common
Stock with that of certain other comparable publicly traded
companies and their securities; (vii) reviewed and compared
certain security analysts reports of the HIB Common Stock
prepared by various investment banking firms; (viii) reviewed the
financial terms, to the extent publicly available, of certain
comparable recent transactions; (ix) reviewed the Merger
Agreement; and (x) performed such other analyses as we have
deemed appropriate.
We have assumed and relied upon, without independent
verification, the accuracy and completeness of the information
reviewed by us for the purposes of this opinion. We have not
made an independent evaluation of the assets or liabilities of
Unicorp, nor have we been furnished with any such appraisals.
With respect to financial forecasts, we have assumed that they
have been reasonably prepared and reflect the best currently
available estimates and judgments of management of Unicorp as to
the future financial performance of Unicorp. We have assumed
such forecasts and projections will be realized in the amounts
and at the times contemplated thereby. With respect to HIB, we
relied solely upon publicly available data and we did not conduct
discussions with the management of HIB regarding HIB's financial
condition, performance and prospects. We did not conduct any
independent evaluation or appraisal of the assets, liabilities or
business prospects of HIB, we were not furnished with any
evaluations or appraisals, and we did not review any individual
credit files of HIB. We are not experts in the evaluation of
loan portfolios for the purposes of assessing the adequacy of the
allowance for losses with respect thereto and have assumed that
such allowances for each of the companies are in the aggregate,
adequate to cover such losses.
Our opinion is necessarily based on economic, market and other
conditions as in effect on, and the information made available to
us as of, the date hereof. Events occurring after the date
hereof could materially affect the assumptions used in preparing
this opinion.
Our opinion is limited to the fairness, from a financial point of
view, to the holders of Unicorp Common Stock of the Merger
Consideration to be received by the holders of the Unicorp Common
Stock as stated in the Merger Agreement and does not address
Unicorp's underlying business decision to undertake the Merger.
Moreover, this letter, and the opinion expressed herein, does not
constitute a recommendation to any shareholder as to any approval
of the Merger or the Merger Agreement. It is understood that
this letter is for the information of the Board of Directors of
Unicorp and the shareholders of Unicorp and may not be used for
any other purpose without our prior written consent, except that
this opinion may be included in its entirety in any filing made
by Unicorp with the Securities and Exchange Commission with
respect to the Merger.
Based on the foregoing and such other matters we have deemed
relevant, we are of the opinion as of the date hereof that the
Merger Consideration is fair, from a financial point of view, to
the holders of Unicorp Common Stock.
Respectfully submitted,
/S/FIRST CAPITAL GROUP, L.L.C.
FIRST CAPITAL GROUP, L.L.C.
INVESTMENT BANKERS & FINANCIAL ADVISORS
APPENDIX C
PROVISIONS OF THE TEXAS BUSINESS CORPORATION ACT
RELATING TO
RIGHTS OF DISSENTING SHAREHOLDERS
(Articles 5.11 - 5.13)
Article 5.11. Rights of Dissenting Shareholders in the Event of
Certain Corporate Actions
A. Any shareholder of a domestic corporation shall have the
right to dissent from any of the following corporate actions:
(1)Any plan of merger to which the corporation is a party if
shareholder approval is required by Article 5.03 or 5.16 of this
Act and the shareholder holds shares of a class or series that
was entitled to vote thereon as a class or otherwise;
(2)Any sale, lease, exchange or other disposition (not
including any pledge, mortgage, deed of trust or trust indenture
unless otherwise provided in the articles of incorporation) of
all, or substantially all, the property and assets, with or
without goodwill, of a corporation requiring the special
authorization of the shareholders as provided by this Act;
(3)Any plan of exchange pursuant to Article 5.02 of this Act
in which the shares of the corporation of the class or series
held by the shareholder are to be acquired.
B. Notwithstanding the provisions of Section A of this
Article, a shareholder shall not have the right to dissent from
any plan of merger in which there is a single surviving or new
domestic or foreign corporation, or from any plan of exchange, if
(1) the shares held by the shareholder are part of a class shares
of which are listed on a national securities exchange, or are
held of record by not less than 2,000 holders, on the record date
fixed to determine the shareholders entitled to vote on the plan
of merger or the plan of exchange, and (2) the shareholder is not
required by the terms of the plan of merger or the plan of
exchange to accept for his shares any consideration other than
(a) shares of a corporation that, immediately after the effective
time of the merger or exchange, shall be part of a class or
series of shares of which are (i) listed, or authorized for
listing upon official notice of issuance, on a national
securities exchange, or (ii) held of record by not less than
2,000 holders, and (b) cash in lieu of fractional shares
otherwise entitled to be received.
Article 5.12. Procedure for Dissent by Shareholders as to Said
Corporate Actions
A. Any shareholder of any domestic corporation who has the
right to dissent from any of the corporate actions referred to in
Article 5.11 of this Act may exercise that right to dissent only
by complying with the following procedures:
(1)(a)With respect to proposed corporate action that is
submitted to a vote of shareholders at a meeting, the shareholder
shall file with the corporation, prior to the meeting, a written
objection to the action, setting out that the shareholder's right
to dissent shall be exercised if the action is effective and
giving the shareholder's address, to which notice thereof shall
be delivered or mailed in that event. If the action is effected
and the shareholder shall not have voted in favor of the action,
the corporation, in the case of action other than a merger, or
the surviving or new corporation (foreign or domestic) or other
entity that is liable to discharge the shareholder's right of
dissent, in the case of a merger, shall, within ten (10) days
after the action is effected, deliver or mail to the shareholder
written notice that the action has been effected, and the
shareholder may, within ten (10) days from the delivery or
mailing of the notice, make written demand on the existing,
surviving, or new corporation (foreign or domestic) or other
entity, as the case may be, for payment of the fair value of the
shareholder's shares. The fair value of the shares shall be the
value thereof as of the day immediately preceding the meeting,
excluding any appreciation or depreciation in anticipation of the
proposed action. The demand shall state the number and class of
the shares owned by the shareholder and the fair value of the
shares as estimated by the shareholder. Any shareholder failing
to make demand within the ten (10) day period shall be bound by
the action.
(b)With respect to proposed corporate action that is approved
pursuant to Section A of Article 9.10 of this Act, the
corporation, in the case of action other than a merger, and the
surviving or new corporation (foreign or domestic) or other
entity that is liable to discharge the shareholder's right of
dissent, in the case of a merger, shall, within ten (10) days
after the date the action is effected, mail to each shareholder
of record as of the effective date of the action notice of the
fact and date of the action and that the shareholder may exercise
the shareholder's right to dissent from the action. The notice
shall be accompanied by a copy of this Article and any articles
or documents filed by the corporation with the Secretary of State
to effect the action. If the shareholder shall not have
consented to the taking of the action, the shareholder may,
within twenty (20) days after the mailing of the notice, make
written demand on the existing, surviving, or new corporation
(foreign or domestic) or other entity, as the case may be, for
payment of the fair value of the shareholder's shares. The fair
value of the shares shall be the value thereof as of the date the
written consent authorizing the action was delivered to the
corporation pursuant to Section A of Article 9.10 of this Act,
excluding any appreciation or depreciation in anticipation of the
action. The demand shall state the number and class of shares
owned by the dissenting shareholder and the fair value of the
shares as estimated by the shareholder. Any shareholder failing
to make demand within the twenty (20) day period shall be bound
by the action.
(2)Within twenty (20) days after receipt by the existing,
surviving, or new corporation (foreign or domestic) or other
entity, as the case may be, of a demand for payment made by a
dissenting shareholder in accordance with Subsection (1) of this
Section, the corporation (foreign or domestic) or other entity
shall deliver or mail to the shareholder a written notice that
shall either set out that the corporation (foreign or domestic)
or other entity accepts the amount claimed in the demand and
agrees to pay that amount within ninety (90) days after the date
on which the action was effected, and, in the case of shares
represented by certificates, upon the surrender of the
certificates duly endorsed, or shall contain an estimate by the
corporation (foreign or domestic) or other entity of the fair
value of the shares, together with an offer to pay the amount of
that estimate within ninety (90) days after the date on which the
action was effected, upon receipt of notice within sixty (60)
days after that date from the shareholder that the shareholder
agrees to accept that amount and, in the case of shares
represented by certificates, upon the surrender of the
certificates duly endorsed.
(3)If, within sixty (60) days after the date on which the
corporate action was effected, the value of the shares is agreed
upon between the shareholder and the existing, surviving, or new
corporation (foreign or domestic) or other entity, as the case
may be, payment for the shares shall be made within ninety (90)
days after the date on which the action was effected, and in the
case of shares represented by certificates, upon surrender of the
certificates duly endorsed. Upon payment of the agreed value,
the shareholder shall cease to have any interest in the shares or
in the corporation.
B. If, within the period of sixty (60) days after the date on
which the corporate action was effected, the shareholder and the
existing, surviving, or new corporation (foreign or domestic) or
other entity, as the case may be, do not so agree, then the
shareholder or the corporation (foreign or domestic) or other
entity may, within sixty (60) days after the expiration of the
sixty (60) day period, file a petition in any court of competent
jurisdiction in the county in which the principal office of the
domestic corporation is located, asking for a finding and
determination of the fair value of the shareholder's shares. Upon
the filing of any such petition by the shareholder, service of a
copy thereof shall be made upon the corporation (foreign or
domestic) or other entity, which shall, within ten (10) days
after service, file in the office of the clerk of the court in
which the petition was filed a list containing the names and
addresses of all shareholders of the domestic corporation who
have demanded payment for their shares and with whom agreements
as to the value of their shares have not been reached by the
corporation (foreign or domestic) or other entity. If the
petition shall be filed by the corporation (foreign or domestic)
or other entity, the petition shall be accompanied by such a
list. The clerk of the court shall give notice of the time and
place fixed for the hearing of the petition by registered mail to
the corporation (foreign or domestic) or other entity and to the
shareholders named on the list at the addresses therein stated.
The forms of the notices by mail shall be approved by the court.
All shareholders thus notified and the corporation (foreign or
domestic) or other entity shall thereafter be bound by the final
judgment of the court.
C. After the hearing of the petition, the court shall
determine the shareholders who have complied with the provisions
of this Article and have become entitled to the valuation of and
payment for their shares, and shall appoint one or more qualified
appraisers to determine that value. The appraisers shall have
power to examine any of the books and records of the corporation
the shares of which they are charged with the duty of valuing,
and they shall make a determination of the fair value of the
shares upon such investigation as to them may seem proper. The
appraisers shall also afford a reasonable opportunity to the
parties interested to submit to them pertinent evidence as to the
value of the shares. The appraisers shall also have such power
and authority as may be conferred on Masters in Chancery by the
Rules of Civil Procedure or by the order of their appointment.
D. The appraisers shall determine the fair value of the
shares of the shareholders adjudged by the court to be entitled
to payment for their shares and shall file their report of their
value in the office of the clerk of the court. Notice of the
filing of the report shall be given by the clerk to the parties
in interest. The report shall be subject to exceptions to be
heard before the court both upon the law and the facts. The
court shall by its judgment determine the fair value of the
shares of the shareholders entitled to payment for their shares
and shall direct the payment of that value by the existing,
surviving, or new corporation (foreign or domestic) or other
entity, together with interest thereon, beginning 91 days after
the date on which the applicable corporate action from which the
shareholder elected to dissent was affected to the date of such
judgment, to the shareholders entitled to payment. The judgment
shall be payable to the holders of uncertificated shares
immediately but to the holders of shares represented by
certificates only upon, and simultaneously with, the surrender to
the existing, surviving, or new corporation (foreign or domestic)
or other entity, as the case may be, of duly endorsed
certificates for those shares. Upon payment of the judgment, the
dissenting shareholders shall cease to have any interest in those
shares or in the corporation. The court shall allow the
appraisers a reasonable fee as court costs, and all court costs
shall be allotted between the parties in the manner that the
court determines to be fair and equitable.
E. Shares acquired by the existing, surviving, or new
corporation (foreign or domestic) or other entity, as the case
may be, pursuant to the payment of the agreed value of the shares
or pursuant to payment of the judgment entered for the value of
the shares, as in this Article provided, shall, in the case of a
merger, be treated as provided in the plan of merger and, in all
other cases, may be held and disposed of by the corporation as in
the case of other treasury shares.
F. The provisions of this Article shall not apply to a merger
if, on the date of the filing of the articles of merger, the
surviving corporation is the owner of all the outstanding shares
of the other corporations, domestic or foreign, that are parties
to the merger.
G. In the absence of fraud in the transaction, the remedy
provided by this Article to a shareholder objecting to any
corporate action referred to in Article 5.11 of this Act is the
exclusive remedy for the recovery of the value of his shares or
money damages to the shareholder with respect to the action. If
the existing, surviving, or new corporation (foreign or domestic)
or other entity, as the case may be, complies with the
requirements of this Article, any shareholder who fails to comply
with the requirements of this Article shall not be entitled to
bring suit for the recovery of the value of his shares or money
damages to the shareholder with respect to the action.
Article 5.13. Provisions Affecting Remedies of Dissenting
Shareholders
A. Any shareholder who has demanded payment for his shares in
accordance with either Article 5.12 or 5.16 of this Act shall not
thereafter be entitled to vote or exercise any other rights of a
shareholder except the right to receive payment for his shares
pursuant to the provisions of those articles and the right to
maintain an appropriate action to obtain relief on the ground
that the corporate action would be or was fraudulent, and the
respective shares for which payment has been demanded shall not
thereafter be considered outstanding for the purposes of any
subsequent vote of shareholders.
B. Upon receiving a demand for payment from any dissenting
shareholder, the corporation shall make an appropriate notation
thereof in its shareholder records. Within twenty (20) days
after demanding payment for his shares in accordance with either
Article 5.12 or 5.16 of this Act, each holder of certificates
representing shares so demanding payment shall submit such
certificates to the corporation for notation thereon that such
demand has been made. The failure of holders of certificated
shares to do so shall, at the option of the corporation,
terminate such shareholder's rights under Articles 5.12 and 5.16
of this Act unless a court of competent jurisdiction for good and
sufficient cause shown shall otherwise direct. If uncertificated
shares for which payment has been demanded or shares represented
by a certificate on which notation has been so made shall be
transferred, any new certificate issued therefor shall bear
similar notation together with the name of the original
dissenting holder of such shares and a transferee of such shares
shall acquire by such transfer no rights in the corporation other
than those which the original dissenting shareholder had after
making demand for payment of the fair value thereof.
C. Any shareholder who has demanded payment for his shares in
accordance with either Article 5.12 or 5.16 of this Act may
withdraw such demand at any time before payment for his shares or
before any petition has been filed pursuant to Article 5.12 or
5.16 of this Act asking for a finding and determination of the
fair value of such shares, but no such demand may be withdrawn
after such payment has been made or, unless the corporation shall
consent thereto, after any such petition has been filed. If,
however, such demand shall be withdrawn as hereinbefore provided,
or if pursuant to Section B of this Article the corporation shall
terminate the shareholder's rights under Article 5.12 or 5.16 of
this Act, as the case may be, or if no petition asking for a
finding and determination of fair value of such shares by a court
shall have been filed within the time provided in Article 5.12 or
5.16 of this Act, as the case may be, or if after the hearing of
a petition filed pursuant to Article 5.12 or 5.16, the court
shall determine that such shareholder is not entitled to the
relief provided by those articles, then, in any such case, such
shareholder and all persons claiming under him shall be
conclusively presumed to have approved and ratified the corporate
action from which he dissented and shall be bound thereby, the
right of such shareholder to be paid the fair value of his shares
shall cease, and his status as a shareholder shall be restored
without prejudice to any corporate proceedings which may have
been taken during the interim, and such shareholders shall be
entitled to receive any dividends or other distributions made to
shareholders in the interim.
APPENDIX D
FORM OF TAX OPINION OF ERNST & YOUNG LLP
[date]
Hibernia Corporation
313 Carondelet Street
New Orleans, Louisiana 70130
Unicorp Bancshares-Texas, Inc.
302 North 5th Street
Orange, Texas 77630-5707
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 Unicorp Bancshares-Texas, Inc. ("Unicorp")
with and into Hibernia Corporation ("Hibernia") (the "Unicorp
Merger"), the proposed merger of Unicorp Bancshares-Delaware,
Inc. ("UB-Delaware") with and into Hibernia (the "UB-Delaware
Merger"), and the proposed merger of OrangeBank ("Bank") with
and into Hibernia National Bank of Texas ("HNBT") (the `Bank
Merger"). (Hereinafter, the Unicorp Merger, the UB-Delaware
Merger, and the Bank Merger are referred to collectively as the
"Proposed Mergers.")
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 [date] provided by the
respective managements of Unicorp, UB-Delaware, Bank, Hibernia,
and HNBT; the Agreement and Plan of Merger made and entered
into by and between Unicorp and Hibernia as of May 28, 1997
(the "Agreement"); the Agreement to Merge between UB-Delaware
and Hibernia (the "UB-Delaware Plan of Merger"); the Agreement
to Merge between Bank and HNBT (the "Bank Plan of Merger"); and
the Registration Statement (Form S-4), as declared effective by
the Securities and Exchange Commission on [date] and containing
the Proxy Statement - Prospectus of Unicorp and Hibernia dated
[date] ("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 Mergers. 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
Mergers and the special meeting of the Unicorp shareholders
with respect thereto. We consent to such reference in the
Prospectus under the captions "Summary," "Proposed Merger-
Representations and Warranties; Conditions to the Merger;
Waiver" and "--Material Tax Consequences." We also understand
that the form of this letter is included as an appendix to the
Form S-4 Registration Statement and the Prospectus. We consent
to such inclusion.
STATEMENT OF FACTS
Unicorp is a corporation organized and existing under the laws
of the State of Texas, and is a bank holding company within the
meaning of the Bank Holding Company Act of 1956, as amended.
As of June 30, 1997, the authorized capital stock of Unicorp
was 9,000,000 shares of common stock, par value $1 per share
("Unicorp Common Stock") and 1,000,000 shares of preferred
stock, par value $1 per share ("Unicorp Preferred Stock"). As
of June 30, 1997, 1,402,742 shares of Unicorp Common Stock had
been issued, 1,395,868 shares of Unicorp Common Stock were
outstanding, 6,874 shares of Unicorp Common Stock were held in
Unicorp's treasury, and no shares of Unicorp Preferred Stock
were issued and outstanding. The shares of Unicorp Common
Stock are held by approximately 76 shareholders. There are no
options, warrants, subordinated rights or other rights to
purchase Unicorp Common Stock outstanding as of the date
hereof.
UB-Delaware is a corporation organized and existing under the
laws of the State of Delaware and a bank holding company within
the meaning of the Bank Holding Company Act of 1956, as
amended. The presently authorized capital stock of UB-Delaware
is 1,000 shares of common stock, par value $1 per share, all of
which were issued and outstanding and held by Unicorp (referred
to as "UB-Delaware Common Stock").
Bank is a Texas banking corporation organized under the laws of
the State of Texas and engaged principally in the banking
business. The presently authorized capital stock of Bank is
600,000 shares of common stock, par value $2.50 per share, all
of which were issued and outstanding and held by UB-Delaware
(referred to as "Bank Common Stock").
Hibernia is a bank holding company organized and existing under
the laws of the State of Louisiana. 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, 1997, 2,000,000
shares of Hibernia's preferred stock were issued and
outstanding, 129,120,951 shares of Hibernia Common Stock were
outstanding, and 51,598 shares of Hibernia Common Stock were
held in Hibernia's treasury. As of June 30, 1997, Hibernia has
the following 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: Hibernia has authorized or reserved 1,626,421
shares of Hibernia Common Stock for issuance under its 1987
Stock Option Plan, pursuant to which options covering 1,472,175
shares of Hibernia Common Stock were outstanding as of June 30,
1997; 7,301,583 (as adjusted) shares of Hibernia Common Stock
for issuance under its Long-Term Incentive Plan, pursuant to
which options covering 6,209,782 shares of Hibernia Common
Stock were outstanding as of June 30, 1997; 932,500 shares of
Hibernia Common Stock for issuance under its 1993 Directors'
Stock Option Plan, pursuant to which options covering 290,000
shares of Hibernia Common Stock are outstanding as of June 30,
1997; 81,999 shares of Hibernia Common Stock are available for
issuance pursuant to Hibernia's Dividend Reinvestment and Stock
Purchase Plan; and warrants covering 213,176 shares of Hibernia
Common Stock are outstanding. On August 31, 1997, Hibernia
completed a merger with Executive Bancshares, Inc. which
resulted in the issuance of 1,161,680 shares of Hibernia Common
Stock. In addition, two transactions currently pending, when
consummated, will result in the issuance of no more than
15,070,000 additional shares of Hibernia Common Stock.
Additionally, on March 14, 1995, Hibernia and its Board of
Directors authorized an employee stock ownership plan (ESOP) to
be funded with $30.0 million of Hibernia Common Stock. The
$30.0 million purchase of Hibernia Common Stock will be funded
through a loan from Hibernia National Bank ("HNB"). Hibernia
Common Stock for the ESOP will be purchased as it becomes
available on the open market at market prices, or in private
negotiated transactions, other than from former shareholders of
Unicorp Common Stock, at such prices as may be agreed by the
parties to the transaction, using funds drawn down on the loan
as needed. At June 30, 1997, 2,431,388 shares have been
acquired. Hibernia Common Stock is traded on the New York
Stock Exchange.
HNB is a nationally chartered bank engaged principally in the
banking business in the state of Louisiana. HNB is a wholly
owned subsidiary of Hibernia.
HNBT is a nationally chartered bank engaged principally in the
banking business in the state of Texas. HNBT is a wholly owned
subsidiary of Hibernia.
BUSINESS PURPOSE
The management of Hibernia has represented to us that Hibernia
desires to consummate the Proposed Mergers in order to improve
its presence in the Texas market. As discussed in the
Prospectus under the caption, "Proposed Merger-Background of
and Reasons for Merger," the Unicorp, Board of Directors
believes the shareholders of Unicorp will benefit from
being part of a larger banking entity, the stock of which
is publicly traded.
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 simultaneous mergers (i.e.,
the Proposed Mergers) of Unicorp with and into Hibernia in
accordance with the Louisiana Business Corporation Law
("LBCL") and the Texas Business Corporation Act ("TBCA"), UB-
Delaware with and into Hibernia in accordance with the
Louisiana Business Corporation Law and the Delaware General
Business Corporation Law ("DGBCL"), and Bank with and into
HNBT 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"). Upon the completion of the Unicorp
Merger, Hibernia will cause the UB-Delaware Merger and the
Bank Merger to occur.
In the Unicorp Merger, Hibernia will acquire all of the
assets and assume all of the liabilities of Unicorp in exchange
for Hibernia Common Stock. As a result of the Unicorp
Merger, each share of the issued and outstanding Unicorp 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 1.6 shares of Hibernia Common
Stock for each outstanding share of Unicorp Common Stock.
Holders of shares of Unicorp Common Stock outstanding
immediately prior to the effective date of the Unicorp Merger
shall cease to be, and shall have no rights as, shareholders of
Unicorp after the Unicorp Merger.
4.In the UB-Delaware Merger, Hibernia will acquire all the
assets and assume all of the liabilities of UB-Delaware in
constructive exchange for Hibernia Common Stock. As a
result of the UB-Delaware Merger, each share of the issued
and outstanding UB-Delaware Common Stock shall cease to be
outstanding and will be canceled. No additional shares of
Hibernia Common Stock will actually be issued in the UB-
Delaware Merger.
5.In the Bank Merger, HNBT will acquire all the assets and
assume all of the liabilities of Bank in constructive
exchange for Hibernia Common Stock. As a result of the Bank
Merger, each share of the issued and outstanding Bank Common
Stock shall cease to be outstanding and will be canceled.
No additional shares of Hibernia Common Stock will actually
be issued, nor will shares of HNBT Common Stock be issued in
the Bank Merger.
6.No fractional shares will be issued. Each holder of Unicorp
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 of the closing price of one share of Hibernia
Common Stock for the ten business days preceding the last
trading day immediately prior to the Closing Date as
reported in The Wall Street Journal.
7. By following certain statutory procedures, shareholders of
Unicorp Common Stock may exercise dissenter's rights
entitling them to receive in cash the value of their
respective Unicorp Common Stock in lieu of receiving
Hibernia Common Stock in the Unicorp Merger.
REPRESENTATIONS
For purposes of our evaluation, we have received from the
respective managements of Unicorp, UB-Delaware, Bank, Hibernia,
and HNBT, Statements of Facts and Representations, dated
[date], 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 Unicorp Merger:
(a) The fair market value of the Hibernia Common Stock to
be received by each shareholder of Unicorp Common
Stock will be approximately equal to the fair market
value of the Unicorp Common Stock surrendered in the
exchange.
(b) There is no plan or intention by the shareholders of
Unicorp who own five percent or more of the Unicorp
Common Stock and to the best knowledge of management
of Unicorp, there is no intention on the part of the
remaining shareholders of Unicorp, to sell, exchange,
or otherwise dispose of a number of shares of
Hibernia Common Stock received in the transaction
that would reduce the Unicorp 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 stock of Unicorp as of the same date.
For purposes of this representation, any shares of
Unicorp Common Stock surrendered by dissenters, or
exchanged for cash in lieu of fractional shares of
Hibernia Common Stock, will be treated as outstanding
on the date of the transaction. Moreover, shares of
Unicorp Common Stock and shares of Hibernia Common
Stock held by former Unicorp shareholders and
otherwise sold, redeemed, or disposed of prior to May
28, 1997, in contemplation of this transaction, or
subsequent to this transaction will be considered in
making this representation.
(c) Hibernia has no plan or intention to reacquire any of
its Common Stock issued in the Unicorp 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).
(d) Hibernia has no plan or intention to sell or
otherwise dispose of any of the assets of Unicorp
acquired in the transaction except for dispositions
made in the ordinary course of business.
(e) Any liabilities of Unicorp assumed by Hibernia and
any liabilities to which the transferred assets of
Unicorp are subject were incurred by Unicorp in the
ordinary course of its business.
(f) Following the transaction, Hibernia will continue,
substantially unchanged, the business of Unicorp as
operated, prior to the Proposed Mergers, through
Unicorp's subsidiary (Bank) which will be merged with
and into HNBT.
(g) 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 Proposed Mergers in
accordance with the guidelines established in Revenue
Ruling 73-54, 1973-1 C.B. 187, Hibernia, Unicorp, and
the shareholders of Unicorp will pay their respective
expenses, if any, incurred in connection with the
transactions.
(h) There is no intercorporate indebtedness existing
between Unicorp 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.
(i) No two parties to the transaction are investment
companies as defined in Section 368(a)(2)(F)(iii) and
(iv) of the Code.
(j) Unicorp 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.
(k) The fair market value of the assets of Unicorp to be
transferred to Hibernia will equal or exceed the sum
of the liabilities assumed by Hibernia plus the
amount of liabilities, if any, to which the
transferred assets are subject.
(l) 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 Unicorp 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 Unicorp shareholders
in exchange for their shares of Unicorp Common Stock.
The fractional share interests of each holder of
Unicorp Common Stock will be aggregated, and no
Unicorp shareholder will receive cash in an amount
equal to or greater than the value of one full share
of Hibernia Common Stock for its Unicorp Common
Stock.
(m) None of the compensation received by any shareholder-
employees of Unicorp or its affiliates will be
separate consideration for, or allocable to, any of
their shares of Unicorp 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.
(n) The Unicorp Merger will qualify as a statutory merger
under the LBCL and the TBCA.
(o) The shareholders of Unicorp (immediately before the
proposed transaction) receiving shares of Hibernia
Common Stock will not own (immediately after the
proposed transaction) more than 50 percent of the
fair market value of Hibernia Common Stock.
The following representations have been made in connection with
the UB-Delaware Merger:
(aa) No additional Hibernia Common Stock will be issued or
exchanged in the UB-Delaware Merger.
(bb) There is no plan or intention by the shareholder of
UB-Delaware to sell, exchange, or otherwise dispose
of a number of shares of Hibernia Common Stock
constructively received in the transaction that would
reduce the UB-Delaware shareholder's 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 stock of UB-Delaware as of the same date.
For purposes of this representation, any shares of UB-
Delaware Common Stock constructively surrendered by
dissenters, or exchanged for cash in lieu of
fractional shares of Hibernia Common Stock, will be
treated as outstanding on the date of the
transaction. Moreover, shares of UB-Delaware Common
Stock and shares of Hibernia Common Stock held by UB-
Delaware or its shareholder and otherwise sold,
redeemed, or disposed of prior to May 28, 1997, in
contemplation of this transaction, or subsequent to
this transaction will be considered in making this
representation.
(cc) Hibernia has no plan or intention to reacquire any of
its Common Stock constructively issued in the UB-
Delaware Merger.
(dd) Hibernia has no plan or intention to sell or
otherwise dispose of any of the assets of UB-Delaware
acquired in the transaction except for dispositions
made in the ordinary course of business.
(ee) Any liabilities of UB-Delaware assumed by Hibernia
and any liabilities to which the transferred assets
of UB-Delaware are subject were incurred by UB-
Delaware in the ordinary course of its business.
(ff) Following the transaction, Hibernia will continue,
substantially unchanged, the business of UB-Delaware
as operated, prior to the Proposed Mergers, through
UB-Delaware's subsidiary (Bank) which will be merged
with and into HNBT.
(gg) 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 Proposed Mergers in
accordance with the guidelines established in Revenue
Ruling 73-54, 1973-1 C.B. 187, Hibernia, UB-Delaware,
and the shareholder of UB-Delaware will pay their
respective expenses, if any, incurred in connection
with the transactions.
(hh) There is no intercorporate indebtedness existing
between UB-Delaware 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.
(ii) No two parties to the transaction are investment
companies as defined in Section 368(a)(2)(F)(iii) and
(iv) of the Code.
(jj) UB-Delaware 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.
(kk) The fair market value of the assets of UB-Delaware to
be transferred to Hibernia will equal or exceed the
sum of the liabilities assumed by Hibernia plus the
amount of liabilities, if any, to which the
transferred assets are subject.
(ll) The UB-Delaware Merger will qualify as a statutory
merger under the LBCL and the DGBCL.
(mm) The shareholder of UB-Delaware (immediately before
the proposed transaction) constructively receiving
shares of Hibernia Common Stock will not
constructively own (immediately after the proposed
transaction) more than 50 percent of the fair
market value of Hibernia Common Stock.
The following representations have been made in connection with
the Bank Merger:
(aaa) No additional Hibernia Common Stock will be
issued or exchanged in the Bank Merger. No HNBT
Common Stock will be issued or exchanged in the Bank
Merger.
(bbb) There is no plan or intention by the shareholder
of Bank to sell, exchange or otherwise dispose of a
number of shares of Hibernia Common Stock
constructively received in the transaction that would
reduce the Bank shareholder's constructive 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 of the formerly
outstanding Bank Common Stock as of the same date.
For purposes of this representation, any shares of
Bank Common Stock constructively exchanged for cash
or other property, surrendered by dissenters, or
exchanged for cash in lieu of fractional shares of
HNBT 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 Bank or its shareholder
and otherwise sold, redeemed, or disposed of prior to
May 28, 1997, in contemplation of this transaction,
or subsequent to this transaction will be considered
in making this representation.
(ccc) HNBT 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 Bank 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.
(ddd) Prior to the transaction, Hibernia will be in
control of HNBT 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.
(eee) Following the transaction, HNBT will not issue
additional shares of its Common Stock that would
result in Hibernia losing control of HNBT within the
meaning of Section 368(c) of the Code.
(fff) Hibernia has no plan or intention to reacquire
any of its Common Stock constructively issued in the
Bank Merger.
(ggg) Hibernia has no plan or intention to liquidate
HNBT; to merge HNBT into another corporation; to sell
or otherwise dispose of the Common Stock of HNBT; or
to cause HNBT 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 consummates other mergers,
it is likely that some or all of the merged banks
will be merged with and into HNBT. At this time, the
discussion provided under the caption "Summary -
Other Pending Transactions for Hibernia" in the
Prospectus provides a complete list of all pending
mergers that are covered by definitive agreements as
of May 28, 1997. However, no Common Stock of HNBT
will be issued as consideration in any of the pending
mergers.
(hhh) The liabilities of Bank assumed by HNBT and the
liabilities to which the transferred assets of Bank
are subject were incurred by Bank in the ordinary
course of its business.
(iii) Following the transaction, HNBT will continue
the historic business of Bank or will use a
significant portion of Bank's historic business
assets in its business.
(jjj) Except for expenses relating to the registration
of Hibernia Common Stock and certain proxy printing
and mailing expenses to be paid solely by Hibernia,
which are directly related to the Proposed Mergers in
accordance with the guidelines established in Revenue
Ruling 73-54, 1973-1 C.B. 187, Hibernia, HNBT, Bank
and the shareholder of Bank will pay their respective
expenses, if any, incurred in connection with the
transaction.
(kkk) There is no intercorporate indebtedness existing
between Hibernia and Bank and their affiliates or
between HNBT and Bank that was issued, acquired, or
will be settled at a discount.
(lll) No two parties to the Bank Merger are investment
companies as defined in Section 368(a)(2)(F)(iii) and
(iv) of the Code.
(mmm) 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.
(nnn) The basis and fair market value of the assets of
Bank transferred to HNBT will each equal or exceed
the sum of the liabilities assumed by HNBT, plus the
amount of liabilities, if any, to which the
transferred assets are subject.
(ooo) The merger of Bank into HNBT will qualify as a
statutory merger under the Bank Merger Act.
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 Unicorp with and into
Hibernia, wherein Hibernia Common Stock is to be exchanged for
Unicorp Common Stock, is to occur as a statutory merger under
applicable state law. Furthermore, it has been represented by
the management of Hibernia that the merger of UB-Delaware with
and into Hibernia, wherein Hibernia Common Stock is to be
constructively exchanged for UB-Delaware Common Stock, is to
occur as a statutory merger under applicable state 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 that the merger of Bank with and into HNBT, wherein
Hibernia Common Stock is to be constructively exchanged for
Bank Common Stock, is to occur as a statutory merger under
applicable state and national law.
Revenue Procedure 77-37, 1977-2 C.B. 568 (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
transaction will be considered as assets held by the
corporation immediately prior to the transfer. Additionally,
the payment of expenses incurred in connection with the
Proposed Mergers is taken into consideration in applying the
"substantially all" test.
In the proposed Bank Merger, it has been represented by the
respective managements of Bank and HNBT that HNBT 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 Bank Merger, before payment to any
dissenters to the Bank 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 Bank 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 [date], the 50 percent continuity of
interest test of Revenue Procedure 77-37, supra, will be met in
the Unicorp Merger, the UB-Delaware Merger, and the Bank
Merger. It has been represented by the management of Unicorp
that the shareholders of Unicorp have no plan or intention to
sell, exchange or otherwise dispose of a number of Hibernia
shares 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 Unicorp
Merger there will be a continuing interest through Common Stock
ownership in Hibernia on the part of the former shareholders of
Unicorp.
In Revenue Ruling 68-526, 1968-2 C.B. 156, the Internal Revenue
Service (the "Service) held that the acquisition of the assets
(and assumption of liabilities) of a parent corporation and its
60 percent owned subsidiary constituted separate tax-free
reorganizations when the transactions occurred pursuant to one
plan of reorganization and for valid business reasons. In
Revenue Ruling 76-528, 1976-2 C.B. 103, the Service clarified
that the continuity of interest requirement was met in Revenue
Ruling 68-526 with respect to the subsidiary acquisition even
when the parent had no assets other than stock of a subsidiary
because, in light of the acquisition of the parent's assets,
and its dissolution pursuant to the plan of reorganization, the
parent's shareholders, in effect, "stepped into the parent's
shoes" as the only qualified parties to receive and continue
the stock interest formerly held by the parent corporation.
Although no assurance can be given that the Service will agree,
the rationale of the above Revenue Rulings suggests that the
continuity of interest maintained by the Unicorp shareholders
in the Unicorp Merger is relevant in determining whether the
continuity of interest requirement is satisfied in the UB-
Delaware Merger and the Bank Merger. See also PLR 9109044
(December 4, 1990) where the Service, after applying the step
transaction doctrine, ruled that a sideways merger of a bank
holding company and its wholly owned banking subsidiary into an
acquiring bank holding company and its banking subsidiary
respectively constituted reorganizations under Section
368(a)(1)(C) and Section 368(a)(2)(D).
In the past, the Service has frequently ruled on certain facts
that the simultaneous mergers of a parent and its wholly-owned
subsidiary into an acquiring parent corporation and its wholly-
owned subsidiary, respectively each qualified as a Section
368(a)(1)(A) reorganization (see e.g., PLR 9111025 (December
14, 1990), 9047015 (August 24, 1990) and 9003053 (October 26,
1989)). In other rulings involving slightly different facts
(i.e., minority shareholders in the subsidiary), the Service
held that the subsidiary mergers were Section 368(a)(1)(A)
reorganizations by reason of Section 368(a)(2)(D) (see e.g.,
PLR 9109044 (December 4, 1990), 8943067 (August 2, 1989) and
8942090 (July 27, 1989)). These private letter rulings involve
simultaneous mergers into two different acquiring corporations
(as with the Unicorp Merger and the Bank Merger). However, the
same continuity of interest principles would also apply with a
single acquiring corporation (as with the Unicorp Merger and
the UB-Delaware Merger).
Although private letter rulings are not binding on the Service
as precedent, they are cited to illustrate a consistent rulings
position. In recent years, while the Service has declined to
rule on whether a transaction qualifies as a reorganization
pursuant to Section 368(a)(1)(A) of the Code (see section
3.01(24) of Rev. Proc. 97-3) it has consistently ruled that the
receipt by a target parent's shareholders of stock of an
acquiring corporation will not prevent a lower tier target's
merger from satisfying the continuity of interest requirement
of Section 1.368-1(b) of the Regulations. See, for example,
PLR 9237031 (June 16, 1992), PLR 9317027 (January 29, 1993),
and PLR 9510059 (March 10, 1995).
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 Bank Merger will meet the continuity of business
enterprise test of Section 1.368-1(d) because, based upon the
representation of the management of HNBT, HNBT will continue
the historic business of Bank or will use a significant portion
of Bank's historic assets in a business.
Revenue Ruling 85-197, 1985-2 C.B. 120, provides that for
purposes of the continuity of business enterprise requirement,
the historic business of a holding company is the business of
its operating subsidiary. Similarly, Revenue Ruling 85-198,
1985-2 C.B. 120, held that the continuity of business
enterprise requirement was met upon the merger of two bank
holding companies where the business of a former subsidiary of
the acquired holding company was continued through a subsidiary
of the acquiring corporation. Accordingly, the continuity of
business enterprise requirement is met with regard to the
Unicorp Merger and the UB-Delaware Merger because Hibernia
through its wholly-owned subsidiary HNBT, will continue the
banking business indirectly conducted by Unicorp and UB-
Delaware.
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 Proposed Mergers. Accordingly, the Proposed
Mergers each satisfy the business purpose requirement as set
forth in the Regulations.
Constructive Exchange of Shares
To avoid the expense and inconvenience of issuing Hibernia
shares to itself in the UB-Delaware Merger and the Bank Merger,
and because Unicorp's shareholders will have already received
fair value for their shares, the shares of UB-Delaware Common
Stock obtained by Hibernia in the Unicorp Merger and the shares
of Bank Common Stock obtained by Hibernia in the UB-Delaware
Merger shall be canceled. (See the preceding discussion
regarding Rev. Rul 76-528) In the UB-Delaware Merger, which
occurs simultaneously, but is to be described in the closing
documents covering the Proposed Mergers as a step following the
Unicorp Merger, Hibernia technically would acquire the assets
of UB-Delaware by issuing shares of Hibernia Common Stock to
the UB-Delaware shareholder, Hibernia (as the result of the
Unicorp Merger). Likewise, in the Bank Merger, which occurs
simultaneously, but is to be described in the closing documents
covering the Proposed Mergers as a step following the UB-
Delaware Merger, HNBT technically would acquire the assets of
Bank by issuing shares of Hibernia Common Stock to the Bank
shareholder, Hibernia (as the result of the Unicorp Merger and
the UB-Delaware Merger).
The tax court has consistently held that the physical transfer
of shares is not necessary if it would be a "meaningless
gesture," particularly in situations where common ownership is
present. See, Fowler Hosiery Co., 36 T.C. 201 (1961), aff'd
301 F.2d 394 (7th Cir. 1962) and William Holton George, 26 T.C.
396 (1956). In fact, the Service has ruled that the absence of
an actual physical exchange of shares does not prevent a
transaction from qualifying as a tax-free reorganization if
such an exchange would have been a "meaningless gesture" or a
"useless task." See Rev. Rul. 70-240, 1970-1 C.B. 81 and Rev.
Rul. 75-383, 1975-2 C.B. 127. See also Davant v. Commissioner,
366 F.2d 874 (5th Cir. 1966); James Armour, Inc., 43 T.C. 295
(1964); American Manufacturing Co., 55 T.C. 204 (1970). In
addition, the Service held in Revenue Ruling 78-47, 1978-1 C.B.
113, that a physical issuance of shares was unnecessary in
order to eliminate certain expenses associated with a
reorganization.
The Service has also consistently permitted constructive
exchanges in private letter rulings. See e.g., PLR 9247019
(August 24, 1992) and 9137029 (June 13, 1991) citing Revenue
Ruling 78-47; PLR 9319017 (February 5, 1993) citing Revenue
Ruling 70-240; PLR 8750071 (September 17, 1987), 8722021
(February 25, 1987), 8620043 (February 14, 1986), 8403028
(October 17, 1983), and 8306010 (November 4, 1982).
Based on the above, the constructive exchanges described herein
do not prevent the UB-Delaware Merger and the Bank Merger from
qualifying as tax-free reorganizations.
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. See
also Treasury Regulations (Treas. Regs.) Section 1.1032-2.
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.
Cash received by shareholders of Unicorp Common Stock who
dissent, will be treated as received in exchange for his or her
stock subject to the provisions and limitations of Section 302
of the Code. See Treas. Reg. Sec. 1.354-1(d), Ex. (3). If, as
a result of such distribution, a shareholder owns no Unicorp
Common Stock either directly or indirectly through the
application of Section 318 of the Code, the redemption will
be treated as a complete termination of interest under
Section 302(b)(3) of the Code and such cash will be treated
as a distribution in exchange for stock under Section 302(a)
of the Code.
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, the UB-Delaware Plan of Merger, and the Bank
Plan of Merger, it is our opinion that the following federal
income tax consequences will result:
In the merger of Unicorp with and into Hibernia:
(1) Provided the proposed merger of Unicorp with and into
Hibernia qualifies as a statutory merger under Louisiana
and Texas law, the Unicorp Merger will be a reorganization
within the meaning of Section 368(a)(1)(A) of the Code.
Unicorp and Hibernia 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 by Unicorp upon the
transfer of its assets to Hibernia in exchange solely for
Hibernia Common Stock, cash for dissenters, if any, and
the assumption by Hibernia of the liabilities of Unicorp,
since any cash for dissenters will be distributed to the
shareholders (Sections 361(a), 361(b), and 357(a) of the
Code).
(3) No gain or loss will be recognized by Hibernia on receipt
of the Unicorp assets in exchange for Hibernia Common
Stock, cash and the assumption by Hibernia of the
liabilities of Unicorp (Section 1032(a) of the Code).
(4) The basis of the assets of Unicorp in the hands of
Hibernia will, in each case, be the same as the basis of
those assets in the hands of Unicorp immediately prior to
the transaction (Section 362(b) of the Code).
(5) The holding period of the assets of Unicorp in the hands
of Hibernia will, in each case, include the period for
which such assets were held by Unicorp (Section 1223(2) of
the Code).
(6) No gain or loss will be recognized, with respect to the
receipt of Hibernia Common Stock, by the shareholders of
Unicorp who receive solely Hibernia Common Stock and cash
for fractional shares in exchange for their shares of
Unicorp Common Stock (Section 354(a)(1) of the Code).
With respect to the cash received in lieu of fractional
shares, see Item 12 below.
(7) The cash received by a dissenting shareholder of Unicorp
in exchange for his or her Unicorp 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 Unicorp Common Stock either directly or indirectly
through the application of Section 318, the redemption
will be treated as a complete termination of interest
under Section 302(b)(3) and such cash will be treated as a
distribution in exchange for stock under Section 302(a).
(8) The basis of Hibernia Common Stock to be received by the
shareholders of Unicorp Common Stock will be, in each
instance, the same as the basis of their stock surrendered
in exchange therefor, decreased by the amount of cash
received, if any, and increased by the amount of gain, if
any, recognized in the exchange. (Section 358(a)(1) of
the Code).
(9) The holding period of the Hibernia Common Stock to be
received by the shareholders of Unicorp Common Stock in
the transaction will include in each instance, the period
during which the Unicorp 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) Hibernia will succeed to and take into account those tax
attributes of Unicorp 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 Hibernia 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)(2) of the Code and Section
1.381(c)(2)-1 of the Regulations, Hibernia will succeed to
and take into account the earnings and profits, or deficit
in earnings and profits, of Unicorp as of the date of
transfer. Any deficit in the earnings and profits of
Unicorp will be used only to offset the earnings and
profits accumulated after the date of transfer.
(12) 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, subject to the provisions
and limitations of 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).
(13) Unicorp will close its taxable year as of the date of the
distribution or transfer. Hibernia will not close its
taxable year merely because of the Unicorp Merger.
(Section 381(b) of the Code).
In the merger of UB-Delaware with and into Hibernia:
(14) Provided the proposed merger of UB-Delaware with and into
Hibernia qualifies as a statutory merger under Louisiana
and Delaware law, the UB-Delaware Merger will be a
reorganization within the meaning of Section 368(a)(1)(A)
of the Code. UB-Delaware and Hibernia will each be a
party to a reorganization within the meaning of Section
368(b) of the Code.
(15) No gain or loss will be recognized by UB-Delaware upon the
transfer of its assets to Hibernia in constructive
exchange solely for Hibernia Common Stock and the
assumption by Hibernia of the liabilities of UB-Delaware
(Sections 361(a), 361(b), and 357(a) of the Code).
(16) No gain or loss will be recognized by Hibernia on receipt
of the UB-Delaware assets in constructive exchange for
Hibernia Common Stock and the assumption by Hibernia of
the liabilities of UB-Delaware (Section 1032(a) of the
Code).
(17) The basis of the assets of UB-Delaware in the hands of
Hibernia will, in each case, be the same as the basis of
those assets in the hands of UB-Delaware immediately prior
to the transaction (Section 362(b) of the Code).
(18) The holding period of the assets of UB-Delaware in the
hands of Hibernia will, in each case, include the period
for which such assets were held by UB-Delaware (Section
1223(2) of the Code).
(19) No gain or loss will be recognized by the shareholder of
UB-Delaware who receives solely Hibernia Common Stock in
constructive exchange for its share of UB-Delaware Common
Stock (Section 354(a)(1) of the Code).
(20) Hibernia will succeed to and take into account those tax
attributes of UB-Delaware 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 Hibernia subject to the conditions and
limitations specified in Sections 381, 382, 383, and 384
of the Code and the Regulations thereunder.
(21) As provided by Section 381(c)(2) of the Code and Section
1.381(c)(2)-1 of the Regulations, Hibernia will succeed to
and take into account the earnings and profits, or deficit
in earnings and profits, of UB-Delaware as of the date of
transfer. Any deficit in the earnings and profits of UB-
Delaware will be used only to offset the earnings and
profits accumulated after the date of transfer.
(22) UB-Delaware will close its taxable year as of the date of
the distribution or transfer. Hibernia will not close its
taxable year merely because of the UB-Delaware Merger.
(Section 381(b) of the Code).
In the merger of Bank with and into HNBT:
(23) Provided the proposed merger of Bank with and into HNBT
qualifies as statutory merger under the Bank Merger Act,
the acquisition by HNBT of substantially all of the assets
of Bank solely in constructive exchange for Hibernia
Common Stock and the assumption by HNBT 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 HNBT will each be a party to
a reorganization within the meaning of Section 368(b) of
the Code.
(24) No gain or loss will be recognized by either Hibernia or
HNBT upon the acquisition by HNBT of substantially all of
the assets of Bank in constructive exchange for Hibernia
Common Stock and the assumption of Bank's liabilities
(Section 1032(a) of the Code). (See Treas. Regs. Section
1.1032-2 and Rev. Rul. 57-278, 1957-1 C.B. 124.)
(25) The basis of the assets of Bank acquired by HNBT will be
the same in the hands of HNBT as the basis of such assets
in the hands of Bank immediately prior to the exchange
(Section 362(b) of the Code).
(26) The basis of the HNBT 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 HNBT and decreased by
the sum of the amount of the liabilities of Bank assumed
by HNBT and the amount of liabilities to which the assets
of Bank are subject (Section 1.358-6(c)(1) of Treas.
Regs.).
(27) The holding period of the assets of Bank received by HNBT
will, in each instance, include the period for which such
assets were held by Bank (Section 1223(2) of the Code).
(28) As provided by Section 381(c) of the Code and Section
1.381(c)(2)-1 of the Regulations, HNBT 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 HNBT
will be used only to offset the earnings and profits
accumulated after the date of transfer.
(29) The shareholder of HNBT will recognize no gain or loss
upon the constructive exchange of Bank Common Stock solely
for Hibernia Common Stock. (Section 354(a)(1) of the
Code.)
(30) Bank will recognize no gain or loss on the transfer of its
assets to HNBT in constructive exchange for Hibernia
Common Stock and the assumption by HNBT of the liabilities
of Bank, as described above. (Sections 361(a) and 357(a)
of the Code.)
(31) Bank will close its taxable year as of the date of the
distribution or transfer. HNBT will not close its taxable
year merely because of the Bank Merger. (Section 381(b)
of the Code.)
(32) Pursuant to Section 381(a) of the Code and Section
1.381(a)-1 of the Regulations, HNBT will succeed to and
take into account the items of Bank described in Section
381(c) of the Code. These items will be taken into
account by HNBT subject to the provisions and limitations
specified in Sections 381, 382, 383 and 384 of the Code
and Regulations promulgated thereunder.
SCOPE OF OPINION
The scope of this opinion is expressly limited to the federal
income tax issues specifically addressed in (1) through (32) in
the section entitled "Federal 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 or
with regard to the foreign, state or local income tax
consequences for the shareholders of Unicorp, UB-Delaware,
Bank, and HNBT. 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 Proposed Mergers, 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 Proposed Mergers.
Further, we have made no determination as whether Unicorp
dividend distributions have been sufficient to eliminate any
undistributed personal holding company tax liability, if
applicable. We have made no determination nor expressed any
opinion as to the fair market value of any of the assets being
transferred in the Proposed Mergers nor the common shares being
exchanged in the Proposed Mergers. Furthermore, our opinion
has not been requested and none is expressed with respect to
any foreign, state or local tax consequences to Unicorp, UB-
Delaware, Bank, Hibernia, and HNBT.
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 opinions 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.
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.
Hibernia Corporation (the "Registrant") has adopted an
indemnification provision in its articles of incorporation that
provides for indemnification of officers and directors under the
circumstances permitted by Louisiana law. The Registrant's
indemnification provision requires indemnification, except as
prohibited by law, of officers and directors of the Registrant 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 Registrant) by
reason of the fact that the person served as an officer or
director of the Registrant or one of its subsidiaries. Officers
and directors may only be indemnified against expenses in cases
brought by the officer or director against the Registrant 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 Registrant 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 Registrant's Articles of Incorporation further provide
that no director or officer of the Registrant will be personally
liable to the Registrant or its shareholders 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 a limitation.
Item 21.... Exhibits and Financial Statement Schedules.
(a)
EXHIBIT DESCRIPTION
2 Agreement and Plan of Merger (included
as Appendix A to the Proxy Statement-
Prospectus)
3.1 Exhibit 3.1 to the Annual Report on Form
10-K for the fiscal year ended December 31,
1996, filed with the Commission by the
Registrant (Commission File No. 0-7220) is
hereby incorporated by reference (Articles
of Incorporation of the Registrant, as
amended to date)
3.2 Exhibit 3.2 to the Quarterly Report on
Form 10-Q for the fiscal period ended June
30, 1997 filed with the Commission by the
Registrant (Commission File No. 0-7220) is
hereby incorporated by reference (By-Laws of
the Registrant, as amended to date)
5 Opinion of Patricia C. Meringer, Esq.
re: legality of shares
8 Opinion of Ernst & Young LLP, certified
public accountants, regarding certain tax
matters (included as Appendix D 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)
10.34 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)
10.37 Exhibit 10.37 to the Registrant's Annual
Report on Form 19-K; Form 10-K for the fiscal
year ended December 31, 1994 filed with the
Commission (Commission File No. 0-7220) is
hereby incorporated by reference (Employment
Agreement) between J. Herbert Boydstun and
Hibernia Corporation)
10.38 Exhibit 10.38 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 E.R. "Bo" Campbell and
Hibernia Corporation)
10.39 Exhibit 10.39 to the Registrant's Annual
Report on Form 10-K for the fiscal year ended
December 31, 1996 filed with the Commission
(Commission File No. 0-7220) is hereby
incorporated by reference (Employment
Agreement between B.D. Flurry and Hibernia
Corporation)
10.40 Exhibit 10.40 to the Registrant's Annual
Report on Form 10-K for the fiscal year ended
December 31, 1996 filed with the Commission
(Commission File No. 0-7220) is hereby
incorporated by reference (Split-Dollar Life
Insurance Plan of the Registrant effective as
of July 1996)
10.41 Exhibit 10.41 to the Registrant's Annual
Report on Form 10-K for the fiscal year ended
December 31, 1996 filed with the Commission
(Commission File No. 0-7220) is hereby
incorporated by reference (Nonqualified
Deferred Compensation Plan for Key Management
Employees of the Registrant effective as of
July 1996)
10.42 Exhibit 10.42 to the Registrant's Annual
Report on Form 10-K for the fiscal year ended
December 31, 1996 filed with the Commission
(Commission File No. 0-7220) is hereby
incorporated by reference (Supplemental Stock
Compensation Plan for Key Management
Employees effective as of July 1996)
10.43 Exhibit 10.43 to the Registrant's Annual
Report on Form 10-K for the fiscal year ended
December 31, 1996 filed with the Commission
(Commission No. 0-7220) is hereby
incorporated by reference (Nonqualified
Target Benefit (Deferred Award) Plan of the
Registrant effective as of July 1996)
13 Exhibit 13 to the Registrant's Annual
Report on Form 10-K for the fiscal year ended
December 31, 1996 filed with the Commission
(Commission File No. 0-7220) is hereby
incorporated by reference (1996 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, 1996 filed with the
Commission (Commission File No. 0-7220) is
hereby incorporated by reference
(Subsidiaries of the Registrant)
23(a) Consent of Patricia C. Meringer, Esq.
(included with Exhibit 5)
23(b)(i) Consent of Lawrence, Blackburn, Meek, Maxey &
Co.
(ii) Consent of Ernst & Young LLP
(iii) Consent of First Capital Group, L.L.C.
24 Powers of Attorney
99 Form of Proxy of Unicorp Bancshares-Texas, Inc.
(b)
FINANCIAL STATEMENT SCHEDULES
N/A
Item 22. Undertakings.
The undersigned registrant hereby undertakes:
(i) to file, during any period in which offers or sales are
being made pursuant to this Registration Statement, a post-
effective amendment to this Registration Statement:
(a) to include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(b) to reflect in the prospectus any facts or events
arising after the effective date of the Registration Statement
(or the most recent post-effective amendment hereof) which,
individually or in the aggregate, represent a fundamental change
in the information set forth in the Registration Statement; and
(c) to include any material information with respect to
the plan of distribution not previously disclosed in the
Registration Statement or any material change to such information
in the Registration Statement;
(ii) that, for purposes of determining any liability under
the Securities Act of 1933, each such post-effective amendment
will be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities
at that time will be deemed to be the initial bona fide offering
thereof;
(iii) to remove from registration by means of a post-
effective amendment any of the securities being registered which
remain unsold at the termination of the offering;
(iv) 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 will be
deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities
at that time will be deemed to be the initial bona fide offering
thereof;
(v) 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;
(vi) that every prospectus (a) that is filed pursuant to the
preceding paragraph, or (b) 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 will
be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities
at that time will be deemed to be the initial bona fide offering
thereof;
(vii) to respond to requests for information that is
incorporated by reference into the prospectus pursuant to Items
4, 10(b), 11 or 13 of Form S-4 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; and
(viii) 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.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Amendment No. 1 to 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 September 25, 1997.
HIBERNIA CORPORATION
By: /s/ PATRICIA C. MERINGER
Patricia C. Meringer
Senior Vice President and
Secretary
Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following
persons in the capacities indicated on September 15, 1997.
Signatures Title
*
_____________________________ Chairman of the Board
Robert H. Boh
*
_____________________________ President and Chief Executive
Stephen A. Hansel Officer and Director
*
_____________________________ Chief Financial Officer
Marsha M. Gassan
*
_____________________________ Chief Accounting Officer
Ron E. Samford, Jr.
*
_____________________________ Director
J. Herbert Boydstun
*
_____________________________ Director
J. Terrell Brown
*
_____________________________ Director
E. R. Campbell
*
_____________________________ Director
Richard W. Freeman, Jr.
*
_____________________________ Director
Dick H. Hearin
*
_____________________________ Director
Robert T. Holleman
*
_____________________________ Director
Elton R. King
*
_____________________________ Director
Sidney W. Lassen
*
_____________________________ Director
Laura A. Leach
*
_____________________________ Director
James R. Murphy
*
_____________________________ Director
Donald J. Nalty
*
_____________________________ Director
William C. O'Malley
*
_____________________________ Director
Robert T. Ratcliff
*
_____________________________ Director
H. Duke Shackelford
*
_____________________________ Director
Janee M. Tucker
*
_____________________________ Director
Virgnia Eason Weinmann
*
_____________________________ 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(a) Consent of Patricia C. Meringer, Esq.
(included with Exhibit 5)
23(b)(i) Consent of Lawrence, Blackburn, Meek,
Maxey & Co.
(ii) Consent of Ernst & Young LLP
(iii) Consent of First Capital Group, L.L.C.
24 Powers of Attorney
99 Form of Proxy of Unicorp
Bancshares-Texas, Inc.
EXHIBIT 5(a)
September 15, 1997
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Ladies and Gentlemen:
I am Corporate 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") with Unicorp Bancshares-Texas, Inc. ("Unicorp") in
which the shareholders of Unicorp will receive the Shares in
exchange for their shares of common stock of Unicorp, 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 Unicorp 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. The Company 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
Corporate Counsel
and Secretary
PCM/gbp
Exhibit 23(b)(i)
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption
Experts and to the use of our report dated March 13, 1997 on
the consolidated financial statements of Unicorp Bancshares-
Texas, Inc. in the Registration Statement (Form S-4) and related
Proxy Statement-Prospectus of Hibernia Corporation for the
registration of approximately 2,234,000 shares of its Class A
common stock.
/s/ LAWRENCE, BLACKBURN, MEEK, MAXEY & CO., P.C.
Lawrence, Blackburn, Meek, Maxey & Co., P.C.
Beaumont, Texas
September 12, 1997
Exhibit 23(b)(ii)
Consent of Ernst & Young LLP
We consent to the reference to our firm under the caption
"Experts" in this Registration Statement (Form S-4) and related
Prospectus of Hibernia Corporation for the registration of
2,233,389 shares of its common stock to be issued pursuant to its
proposed merger with Unicorp Bancshares-Texas, Inc. and to the
incorporation by reference therein of our report dated January
15, 1997, 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, 1996, filed
with the Securities and Exchange Commission.
/s/ ERNST & YOUNG LLP
Ernst & Young LLP
New Orleans, Louisiana
September 15, 1997
Exhibit 23(b)(iii)
Consent of First Capital Group, L.L.C.
In connection with the proposed merger of Unicorp Bancshares--
Texas, Inc. by Hibernia Corporation, the undersigned, acting as
an independent financial advisor to the common shareholders of
Unicorp Bancshares--Texas, Inc., hereby consents to the reference
to our firm in the proxy statement and to the inclusion of our
fairness opinion as an exhibit to the proxy statement.
August 14, 1997
First Capital Group, L.L.C.
Exhibit 24
Powers of Attorney
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 Marsha M. Gassan, Patricia C. Meringer and Gary L. Ryan,
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 the Corporation and Unicorp Bancshares-Texas, Inc.
("Unicorp") wherein the Corporation agrees to exchange shares of
its common stock for all of the outstanding shares of common
stock of Unicorp and merge Unicorp into the Corporation,
authorized by resolutions adopted by the Board of Directors on
July 23, 1997 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 as of the 23rd day of July, 1997
/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 Marsha
M. Gassan, Patricia C. Meringer and Gary L. Ryan, 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 the Corporation
and Unicorp Bancshares-Texas, Inc. ("Unicorp") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of Unicorp and merge
Unicorp into the Corporation, authorized by resolutions adopted
by the Board of Directors on July 23, 1997 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 as of the 23rd day of July, 1997
/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 Marsha
M. Gassan, Patricia C. Meringer and Gary L. Ryan, 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 the Corporation
and Unicorp Bancshares-Texas, Inc. ("Unicorp") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of Unicorp and merge
Unicorp into the Corporation, authorized by resolutions adopted
by the Board of Directors on July 23, 1997 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 as of the 23rd day of July, 1997
/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 Marsha
M. Gassan, Patricia C. Meringer and Gary L. Ryan, 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 the Corporation
and Unicorp Bancshares-Texas, Inc. ("Unicorp") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of Unicorp and merge
Unicorp into the Corporation, authorized by resolutions adopted
by the Board of Directors on July 23, 1997 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 as of the 23rd day of July, 1997
/s/ E. R. "BO" CAMPBELL
E. R. "Bo" Campbell
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 Marsha
M. Gassan, Patricia C. Meringer and Gary L. Ryan, 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 the Corporation
and Unicorp Bancshares-Texas, Inc. ("Unicorp") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of Unicorp and merge
Unicorp into the Corporation, authorized by resolutions adopted
by the Board of Directors on July 23, 1997 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 as of the 23rd day of July, 1997
/s/ RICHARD W. FREEMAN, JR.
Richard W. Freeman, Jr.
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 Marsha M. Gassan, Patricia C.
Meringer and Gary L. Ryan, 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 the Corporation and Unicorp
Bancshares-Texas, Inc. ("Unicorp") wherein the Corporation agrees
to exchange shares of its common stock for all of the outstanding
shares of common stock of Unicorp and merge Unicorp into the
Corporation, authorized by resolutions adopted by the Board of
Directors on July 23, 1997 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 as of the 23rd day of July, 1997
/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 Marsha
M. Gassan, Patricia C. Meringer and Gary L. Ryan, 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 the Corporation
and Unicorp Bancshares-Texas, Inc. ("Unicorp") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of Unicorp and merge
Unicorp into the Corporation, authorized by resolutions adopted
by the Board of Directors on July 23, 1997 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 as of the 23rd day of July, 1997
/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 Marsha
M. Gassan, Patricia C. Meringer and Gary L. Ryan, 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 the Corporation
and Unicorp Bancshares-Texas, Inc. ("Unicorp") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of Unicorp and merge
Unicorp into the Corporation, authorized by resolutions adopted
by the Board of Directors on July 23, 1997 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 as of the 23rd day of July, 1997
/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 Marsha
M. Gassan, Patricia C. Meringer and Gary L. Ryan, 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 the Corporation
and Unicorp Bancshares-Texas, Inc. ("Unicorp") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of Unicorp and merge
Unicorp into the Corporation, authorized by resolutions adopted
by the Board of Directors on July 23, 1997 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 as of the 23rd day of July, 1997
/s/ ELTON R. KING
Elton R. King
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 Marsha
M. Gassan, Patricia C. Meringer and Gary L. Ryan, 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 the Corporation
and Unicorp Bancshares-Texas, Inc. ("Unicorp") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of Unicorp and merge
Unicorp into the Corporation, authorized by resolutions adopted
by the Board of Directors on July 23, 1997 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 as of the 23rd day of July, 1997
/s/ SIDNEY W. LASSEN
Sidney W. Lassen
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 Marsha
M. Gassan, Patricia C. Meringer and Gary L. Ryan, 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 the Corporation
and Unicorp Bancshares-Texas, Inc. ("Unicorp") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of Unicorp and merge
Unicorp into the Corporation, authorized by resolutions adopted
by the Board of Directors on July 23, 1997 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 as of the 23rd day of July, 1997
/s/ LAURA A. LEACH
Laura A. Leach
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 Marsha
M. Gassan, Patricia C. Meringer and Gary L. Ryan, 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 the Corporation
and Unicorp Bancshares-Texas, Inc. ("Unicorp") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of Unicorp and merge
Unicorp into the Corporation, authorized by resolutions adopted
by the Board of Directors on July 23, 1997 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 as of the 23rd day of July, 1997
/s/ JAMES R. MURPHY
James R. Murphy
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 Marsha M. Gassan, Patricia C. Meringer and Gary L. Ryan,
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 the Corporation and Unicorp Bancshares-Texas, Inc.
("Unicorp") wherein the Corporation agrees to exchange shares of
its common stock for all of the outstanding shares of common
stock of Unicorp and merge Unicorp into the Corporation,
authorized by resolutions adopted by the Board of Directors on
July 23, 1997 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 as of the 23rd day of July, 1997
/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 Marsha
M. Gassan, Patricia C. Meringer and Gary L. Ryan, 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 the Corporation
and Unicorp Bancshares-Texas, Inc. ("Unicorp") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of Unicorp and merge
Unicorp into the Corporation, authorized by resolutions adopted
by the Board of Directors on July 23, 1997 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 as of the 23rd day of July, 1997
/s/ WILLIAM C. O'MALLEY
William C. O'Malley
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 Marsha
M. Gassan, Patricia C. Meringer and Gary L. Ryan, 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 the Corporation
and Unicorp Bancshares-Texas, Inc. ("Unicorp") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of Unicorp and merge
Unicorp into the Corporation, authorized by resolutions adopted
by the Board of Directors on July 23, 1997 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 as of the 23rd day of July, 1997
/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 Marsha
M. Gassan, Patricia C. Meringer and Gary L. Ryan, 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 the Corporation
and Unicorp Bancshares-Texas, Inc. ("Unicorp") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of Unicorp and merge
Unicorp into the Corporation, authorized by resolutions adopted
by the Board of Directors on July 23, 1997 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 as of the 23rd day of July, 1997
/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 Marsha
M. Gassan, Patricia C. Meringer and Gary L. Ryan, 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 the Corporation
and Unicorp Bancshares-Texas, Inc. ("Unicorp") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of Unicorp and merge
Unicorp into the Corporation, authorized by resolutions adopted
by the Board of Directors on July 23, 1997 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 as of the 23rd day of July, 1997
/s/ JANEE M. "GEE" TUCKER
Janee M. "Gee" Tucker
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 Marsha
M. Gassan, Patricia C. Meringer and Gary L. Ryan, 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 the Corporation
and Unicorp Bancshares-Texas, Inc. ("Unicorp") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of Unicorp and merge
Unicorp into the Corporation, authorized by resolutions adopted
by the Board of Directors on July 23, 1997 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 as of the 23rd day of July, 1997
/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 Marsha
M. Gassan, Patricia C. Meringer and Gary L. Ryan, 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 the Corporation
and Unicorp Bancshares-Texas, Inc. ("Unicorp") wherein the
Corporation agrees to exchange shares of its common stock for all
of the outstanding shares of common stock of Unicorp and merge
Unicorp into the Corporation, authorized by resolutions adopted
by the Board of Directors on July 23, 1997 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 as of the 23rd day of July, 1997
/s/ ROBERT E. ZETZMANN
Robert E. Zetzmann
Director
HIBERNIA CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned
Controller and Chief Accounting Officer of Hibernia Corporation,
a Louisiana corporation (the "Corporation"), does hereby name,
constitute and appoint Marsha M. Gassan, Patricia C. Meringer and
Gary L. Ryan, 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 the Corporation and Unicorp Bancshares-Texas, Inc.
("Unicorp") wherein the Corporation agrees to exchange shares of
its common stock for all of the outstanding shares of common
stock of Unicorp and merge Unicorp into the Corporation,
authorized by resolutions adopted by the Board of Directors on
July 23, 1997 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 as of the 23rd day of July, 1997
/s/ RON E. SAMFORD, JR.
Ron E. Samford, Jr.
Controller and Chief Accounting Officer
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 Marsha M. Gassan, Patricia C. Meringer and Gary L. Ryan,
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 the Corporation and Unicorp Bancshares-Texas, Inc.
("Unicorp") wherein the Corporation agrees to exchange shares of
its common stock for all of the outstanding shares of common
stock of Unicorp and merge Unicorp into the Corporation,
authorized by resolutions adopted by the Board of Directors on
July 23, 1997 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 as of the 23rd day of July, 1997
/s/ MARSHA M. GASSAN
Marsha M. Gassan
Chief Financial Officer
HIBERNIA CORPORATION
EXHIBIT 99
UNICORP BANCSHARES-TEXAS, INC.
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF
THE BOARD OF DIRECTORS OF UNICORP BANCSHARES-TEXAS, INC.
The undersigned shareholder of Unicorp Bancshares-Texas,
Inc. ("Unicorp"), a Texas corporation, hereby constitutes and
appoints Carlos R. Vacek and Lin M. Bingham, or either of them,
proxies with full power of substitution to vote and act for the
undersigned, as designated below, with respect to the number of
shares of common stock, $1.00 par value, of Unicorp the
undersigned would be entitled to vote if personally present at
the Special Meeting of Shareholders of Unicorp, which will be
held at the office of Unicorp Bancshares-Texas, Inc. (which is
the main office of OrangeBank), 302 N. 5th Street, Orange, Texas
on ________ __, 1997 at _____ _.m. (the "Special Meeting"), and
at any adjournments or postponements thereof, and, at their
discretion, the proxies are authorized to vote upon such other
business as may properly come before the Special Meeting.
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS
DIRECTED HEREIN BY THE SHAREHOLDER. IF NO DIRECTION IS SPECIFIED
WHEN THE DULY EXECUTED PROXY IS RETURNED, SUCH SHARES WILL BE
VOTED IN ACCORDANCE WITH THE RECOMMENDATION OF THE BOARD OF
DIRECTORS OF UNICORP, OR, IN THE EVENT A MATTER IS PROPERLY
BROUGHT BEFORE THE SPECIAL MEETING AS TO WHICH THE BOARD OF
DIRECTORS HAS MADE NO RECOMMENDATION, THE PROXIES WILL VOTE THE
SHARES IN THEIR DISCRETION.
The Board of Directors of Unicorp recommends that you vote
FOR the approval of the Amended and Restated Agreement and Plan
of Merger between Unicorp and Hibernia effective as of May 28,
1997 and the merger (the "Merger") of Unicorp into Hibernia
Corporation ("Hibernia").
THIS PROXY IS CONTINUED ON THE REVERSE SIDE
PLEASE SIGN ON THE REVERSE SIDE AND RETURN PROMPTLY
IN THE ENCLOSED POSTAGE PAID ENVELOPE
PLEASE MARK YOUR CHOICE LIKE
THIS ___ IN BLUE OR BLACK INK
/___/
____________________
Common Stock
Approval of the Agreement and Plan of Merger between
Unicorp and Hibernia dated as of May 28, 1997 and the
Merger.
For Against Abstain
___ ___ ___
/___/ /___/ /___/
The undersigned hereby acknowledges receipt of a copy of the
accompanying Notice of Special Meeting of Shareholders and Proxy
Statement and hereby revokes any proxy or proxies heretofore
given.
Date_______________________________
Signature__________________________
Please mark, date and sign as your account name appears and
return in the enclosed envelope. If acting as executor,
administrator, trustee, guardian, or in a similar capacity, you
should so indicate when signing. If the person signing is a
corporation, partnership or other entity, please sign the full
name of the corporation or partnership or other entity by a duly
authorized officer, partner or other person. If the shares are
held jointly, each shareholder named should sign.
