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Previous: MASCO CORP /DE/, S-3, 1994-10-17 |
Next: NATIONAL DATA CORP, 10-Q, 1994-10-17 |
<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) - August 24, 1994
MELLON BANK CORPORATION
(Exact name of registrant as specified in charter)
Pennsylvania 1-7410
(State or other jurisdiction (Commission
of incorporation) File Number)
One Mellon Bank Center
500 Grant Street
Pittsburgh, Pennsylvania 15258
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code - (412) 234-5000
<PAGE> 2
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
Mellon Bank Corporation (the "Corporation") announced on
August 24, 1994, that the merger between the Corporation and
The Dreyfus Corporation had been completed.
On August 26, 1994, the Corporation filed a Current Report on
Form 8-K describing the completion of the merger between the
two entities and filed as an exhibit thereto its August 24,
1994, press release relating to such event. At that date, it
was impracticable for the Corporation to include in the
Form 8-K filing the financial statements and information in
response to Item 7. Accordingly, as permitted by Item 7 of
Form 8-K, attached hereto as Exhibit 99.1 are the unaudited
pro forma combined financial statements of the Corporation
and The Dreyfus Corporation.
<TABLE>
<CAPTION>
Exhibit
Number Description
<S> <C>
99.1 Mellon Bank Corporation and Subsidiaries and The
Dreyfus Corporation and Subsidiaries Pro Forma
Combined Financial Statements (unaudited).
</TABLE>
Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned thereunto duly
authorized.
MELLON BANK CORPORATION
Date: October 17, 1994 By: James M. Gockley
James M. Gockley
Assistant General
Counsel and Secretary
<PAGE> 3
EXHIBIT INDEX
<TABLE>
<CAPTION>
Number Description Method of Filing
<S> <C> <C>
99.1 Mellon Bank Corporation Filed herewith
and Subsidiaries and The
Dreyfus Corporation and
Subsidiaries Pro Forma
Combined Financial Statements
(unaudited)
</TABLE>
<PAGE> 1
EX-99.1
<TABLE>
MELLON BANK CORPORATION AND SUBSIDIARIES AND
THE DREYFUS CORPORATION AND SUBSIDIARIES
(UNAUDITED)
<CAPTION>
TABLE OF CONTENTS
Page
----
<S> <C>
Pro Forma Condensed Combined Balance Sheet - June 30, 1994 1
Pro Forma Condensed Combined Income Statements:
Six Months Ended June 30, 1994 2
Six Months Ended June 30, 1993 3
Year Ended December 31, 1993 4
Year Ended December 31, 1992 5
Year Ended December 31, 1991 6
Six Months Ended June 30, 1993, including The Boston Company 7
Year Ended December 31, 1993, including The Boston Company 8
Notes to Pro Forma Condensed Combined Financial Statements 9
</TABLE>
NOTE: The following unaudited pro forma condensed combined balance sheet as of
June 30, 1994 and the unaudited pro forma condensed combined income statements
for the six-month periods ended June 30, 1994 and 1993, and for the three years
ended December 31, 1993, 1992 and 1991, give effect to the merger of Mellon
Bank Corporation (Mellon) and The Dreyfus Corporation (Dreyfus) consummated on
August 24, 1994, accounted for as a pooling-of-interests. The pro forma
information is based on the historical consolidated financial statements of
Dreyfus and Mellon and their subsidiaries reflecting the adjustments set forth
in the accompanying notes.
The unaudited pro forma condensed combined financial statements have
been prepared by the managements of Dreyfus and Mellon based upon their
respective consolidated financial statements. Pro forma earnings per common
share amounts are based on the Exchange Ratio of 0.88017 shares of Mellon
common stock for each share of Dreyfus common stock. The unaudited pro forma
condensed combined income statements, which include results of operations as if
the merger had been consummated on January 1, 1991, do not reflect the merger
expenses or the losses on the disposition of securities available for sale
recorded following the consummation of the merger, or the cost savings
anticipated to result from the merger. As a result, the unaudited pro forma
condensed combined financial statements may not be indicative of the results
that actually would have occurred if the merger had been in effect during the
periods presented or which may be attained in the future. Results for the
interim period are not necessarily indicative of results expected for the year
as a whole. The unaudited pro forma condensed combined financial statements
should be read in conjunction with the historical consolidated financial
statements and notes thereto of Dreyfus and Mellon.
<PAGE> 2
<TABLE>
MELLON BANK CORPORATION AND SUBSIDIARIES AND
THE DREYFUS CORPORATION AND SUBSIDIARIES
PRO FORMA CONDENSED COMBINED BALANCE SHEET (a)
JUNE 30, 1994
(UNAUDITED)
<CAPTION>
PRO FORMA PRO FORMA
(IN MILLIONS) MELLON DREYFUS ADJUSTMENTS COMBINED
------ ------- ----------- --------
<S> <C> <C> <C> <C>
ASSETS
- ------
Cash and due from banks $ 1,701 $ 9 $ - $ 1,710
Money market investments 1,131 146 - 1,277
Trading account securities 365 - - 365
Securities available for sale 2,756 364 (322)(d) 2,813
15 (d)
Investment securities 3,217 124 - 3,341
Loans, net of unearned income 24,726 5 - 24,731
Reserve for credit losses (609) - - (609)
------- ----- ----- --------
Net loans 24,117 5 - 24,122
Premises and equipment 449 77 (21)(d) 505
Acquired property, net of reserve 109 - - 109
Goodwill 775 1 - 776
Other intangibles 493 - - 493
Other assets 1,861 208 (4)(d) 2,065
------- ----- ----- -------
Total assets $36,974 $ 934 $(332) $37,576
======= ===== ===== =======
LIABILITIES
- -----------
Deposits:
Interest-bearing $20,412 $ 24 $ - $20,436
Noninterest-bearing 5,771 1 - 5,772
------- ----- ----- -------
Total deposits 26,183 25 - 26,208
Short-term borrowings 3,951 - (307)(d) 3,644
Other liabilities 1,460 60 54 (d) 1,573
(1)(e)
Notes and debentures 1,921 - - 1,921
------- ----- ----- -------
Total liabilities 33,515 85 (254) 33,346
------- ----- ----- -------
SHAREHOLDERS' EQUITY
- --------------------
Preferred stock 592 - - 592
Common stock 32 4 12 (b) 48
Additional paid-in capital 1,780 280 (203)(b) 1,861
4 (e)
Retained earnings and other 1,023 756 (79)(d) 1,697
(10)(d)
10 (d)
(3)(e)
Warrants 37 - - 37
Treasury stock, at cost (5) (191) 191 (b) (5)
------- ----- ----- -------
Total common shareholders' equity 2,867 849 (78) 3,638
------- ----- ----- -------
Total shareholders' equity 3,459 849 (78) 4,230
------- ----- ----- -------
Total liabilities and shareholders' equity $36,974 $ 934 $(332) $37,576
======= ===== ===== =======
See accompanying "Notes To Pro Forma Condensed Combined Financial Statements."
</TABLE>
1
<PAGE> 3
<TABLE>
MELLON BANK CORPORATION AND SUBSIDIARIES AND
THE DREYFUS CORPORATION AND SUBSIDIARIES
PRO FORMA CONDENSED COMBINED INCOME STATEMENT (a)
SIX MONTHS ENDED JUNE 30, 1994
(UNAUDITED)
<CAPTION>
PRO FORMA
(DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS; SHARES IN THOUSANDS) MELLON DREYFUS COMBINED
------ ------- --------
<S> <C> <C> <C>
Interest revenue $ 1,049 $ 12 $ 1,061
Interest expense 330 - 330
------- ------- -------
Net interest revenue 719 12 731
Provision for credit losses 40 - 40
------- ------- -------
Net interest revenue after provision for credit losses 679 12 691
Fee revenue 679 169 848
Gains on sale of securities - 10 10
------- ------- -------
Total noninterest revenue 679 179 858
Operating expense 927 112 1,039
------- ------- -------
Income before income taxes 431 79 510
Provision for income taxes 166 30 196
------- ------- -------
Net income $ 265 $ 49 $ 314
======= ======= =======
Net income applicable to common stock $ 235 $ 49 $ 284
======= ======= =======
Weighted average common shares and common stock equivalents: (c)
Primary 66,458 37,213 99,212
Fully diluted 66,548 37,248 99,332
Net income per common share:
Primary $ 3.57 $ 1.33 $ 2.89
Fully diluted 3.57 1.33 2.89
See accompanying "Notes To Pro Forma Condensed Combined Financial Statements."
</TABLE>
2
<PAGE> 4
<TABLE>
MELLON BANK CORPORATION AND SUBSIDIARIES AND
THE DREYFUS CORPORATION AND SUBSIDIARIES
PRO FORMA CONDENSED COMBINED INCOME STATEMENT (a)
SIX MONTHS ENDED JUNE 30, 1993
(UNAUDITED)
<CAPTION>
PRO FORMA
(DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS; SHARES IN THOUSANDS) MELLON DREYFUS COMBINED
------ ------- --------
<S> <C> <C> <C>
Interest revenue $ 957 $ 12 $ 969
Interest expense 326 - 326
------- ------- -------
Net interest revenue 631 12 643
Provision for credit losses 70 - 70
------- ------- -------
Net interest revenue after provision for credit losses 561 12 573
Fee revenue 513 177 690
Gains (losses) on sale of securities 87 (4) 83
------- ------- -------
Total noninterest revenue 600 173 773
Operating expense 924 106 1,030
------- ------- -------
Income before income taxes 237 79 316
Provision for income taxes 104 29 133
------- ------- -------
Net income $ 133 $ 50 $ 183
======= ======= =======
Net income applicable to common stock $ 102 $ 50 $ 152
======= ======= =======
Weighted average common shares and common stock equivalents: (c)
Primary 63,645 37,536 96,683
Fully diluted 63,737 37,542 96,780
Net income per common share:
Primary $ 1.63 $ 1.33 $ 1.59
Fully diluted 1.63 1.33 1.59
See accompanying "Notes To Pro Forma Condensed Combined Financial Statements."
</TABLE>
3
<PAGE> 5
<TABLE>
MELLON BANK CORPORATION AND SUBSIDIARIES AND
THE DREYFUS CORPORATION AND SUBSIDIARIES
PRO FORMA CONDENSED COMBINED INCOME STATEMENT (a)
YEAR ENDED DECEMBER 31, 1993
<CAPTION>
PRO FORMA
COMBINED
(DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS; SHARES IN THOUSANDS) MELLON DREYFUS (UNAUDITED)
------ ------- -----------
<S> <C> <C> <C>
Interest revenue $ 1,961 $ 24 $ 1,985
Interest expense 654 1 655
------- ------- -------
Net interest revenue 1,307 23 1,330
Provision for credit losses 125 - 125
------- ------- -------
Net interest revenue after provision for credit losses 1,182 23 1,205
Fee revenue 1,189 348 1,537
Gains on sale of securities 87 13 100
------- ------- -------
Total noninterest revenue 1,276 361 1,637
Operating expense 1,858 226 2,084
------- ------- -------
Income before income taxes 600 158 758
Provision for income taxes 239 59 298
------- ------- -------
Net income $ 361 $ 99 $ 460
======= ======= =======
Net income applicable to common stock $ 298 $ 99 $ 397
======= ======= =======
Weighted average common shares and common stock equivalents: (c)
Primary 65,179 37,352 98,055
Fully diluted 65,270 37,408 98,195
Net income per common share:
Primary $ 4.63 $ 2.67 $ 4.09
Fully diluted 4.63 2.66 4.09
See accompanying "Notes To Pro Forma Condensed Combined Financial Statements."
</TABLE>
4
<PAGE> 6
<TABLE>
MELLON BANK CORPORATION AND SUBSIDIARIES AND
THE DREYFUS CORPORATION AND SUBSIDIARIES
PRO FORMA CONDENSED COMBINED INCOME STATEMENT (a)
YEAR ENDED DECEMBER 31, 1992
<CAPTION>
PRO FORMA
COMBINED
(DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS; SHARES IN THOUSANDS) MELLON DREYFUS (UNAUDITED)
------ ------- -----------
<S> <C> <C> <C>
Interest revenue $ 2,000 $ 30 $ 2,030
Interest expense 846 2 848
------- ------- -------
Net interest revenue 1,154 28 1,182
Provision for credit losses 185 - 185
------- ------- -------
Net interest revenue after provision for credit losses 969 28 997
Fee revenue 851 303 1,154
Gains on sale of securities 121 8 129
------- ------- -------
Total noninterest revenue 972 311 1,283
Operating expense 1,449 199 1,648
------- ------- -------
Income before income taxes 492 140 632
Provision for income taxes 55 49 104
------- ------- -------
Net income $ 437 $ 91 $ 528
======= ======= =======
Net income applicable to common stock $ 386 $ 91 $ 477
======= ======= =======
Weighted average common shares and common stock equivalents: (c)
Primary 55,912 38,621 89,905
Fully diluted 57,559 38,629 91,559
Net income per common share:
Primary $ 6.96 $ 2.36 $ 5.34
Fully diluted 6.84 2.36 5.30
See accompanying "Notes To Pro Forma Condensed Combined Financial Statements."
</TABLE>
5
<PAGE> 7
<TABLE>
MELLON BANK CORPORATION AND SUBSIDIARIES AND
THE DREYFUS CORPORATION AND SUBSIDIARIES
PRO FORMA CONDENSED COMBINED INCOME STATEMENT (a)
YEAR ENDED DECEMBER 31, 1991
<CAPTION>
PRO FORMA
COMBINED
(DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS; SHARES IN THOUSANDS) MELLON DREYFUS (UNAUDITED)
------ ------- -----------
<S> <C> <C> <C>
Interest revenue $ 2,303 $ 41 $ 2,344
Interest expense 1,329 3 1,332
------- ------- -------
Net interest revenue 974 38 1,012
Provision for credit losses 250 - 250
------- ------- -------
Net interest revenue after provision for credit losses 724 38 762
Fee revenue 770 237 1,007
Gains on sale of securities 78 3 81
------- ------- -------
Total noninterest revenue 848 240 1,088
Operating expense 1,264 176 1,440
------- ------- -------
Income before income taxes 308 102 410
Provision for income taxes 28 34 62
------- ------- -------
Net income $ 280 $ 68 $ 348
======= ======= =======
Net income applicable to common stock $ 231 $ 68 $ 299
======= ======= =======
Weighted average common shares and common stock equivalents: (c)
Primary 50,191 38,831 84,369
Fully diluted 50,757 39,025 85,106
Net income per common share:
Primary $ 4.66 $ 1.75 $ 3.58
Fully diluted 4.61 1.74 3.55
See accompanying "Notes To Pro Forma Condensed Combined Financial Statements."
</TABLE>
6
<PAGE> 8
<TABLE>
MELLON BANK CORPORATION AND SUBSIDIARIES,
THE BOSTON COMPANY, INC. AND SUBSIDIARIES AND
THE DREYFUS CORPORATION AND SUBSIDIARIES*
PRO FORMA CONDENSED COMBINED INCOME STATEMENT (a)
SIX MONTHS ENDED JUNE 30, 1993
(UNAUDITED)
<CAPTION>
PRO FORMA
MELLON AND
THE BOSTON PRO FORMA
(DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS; SHARES IN THOUSANDS) COMPANY DREYFUS COMBINED
---------- ------- --------
<S> <C> <C> <C>
Interest revenue $ 1,117 $ 12 $ 1,129
Interest expense 425 - 425
------- ------- ------
Net interest revenue 692 12 704
Provision for credit losses 74 - 74
------- ------- ------
Net interest revenue after provision for credit losses 618 12 630
Fee revenue 666 177 843
Gains(losses)on sale of securities 87 (4) 83
------- ------- ------
Total noninterest revenue 753 173 926
Operating expense 925 106 1,031
------- ------ ------
Income before income taxes 446 79 525
Provision for income taxes 185 29 214
------- ------ ------
Net income $ 261 $ 50 $ 311
======= ======== ========
Net income applicable to common stock $ 231 $ 50 $ 281
======= ======= ========
Weighted average common shares and common stock equivalents: (c)
Primary 66,290 37,536 99,328
Fully diluted 66,380 37,542 99,424
Net income per common share:
Primary $ 3.48 $ 1.33 $ 2.83
Fully diluted 3.47 1.33 2.82
<FN>
* This pro forma condensed combined income statement is presented as if Mellon's
acquisition of The Boston Company, Inc. (TBC) had been effective January 1,
1993 as shown in further detail in Mellon's Second Quarter 1993 Form 10-Q
dated as of August 6, 1993 and filed August 10, 1993. The first column
above combines TBC's results of operations for the period January 1, 1993,
through May 20, 1993, and Mellon's results of operations for the six months
ended June 30, 1993, which included TBC's results of operations from May 21,
1993 to June 30, 1993. The first column also reflects a number of
assumptions relating to the funding of the purchase price, the issuance of
Mellon common stock and warrants, the amortization of goodwill, the
elimination of $175 million of nonrecurring merger expenses recorded by
Mellon and other adjustments, as further explained in Mellon's Second
Quarter 1993 Form 10-Q. The elimination of such nonrecurring merger
expenses and certain other adjustments are not reflected in the pro forma
condensed combined income statements of Mellon and Dreyfus presented on
pages 3 and 4. Accordingly, the pro forma information presented above is
not directly comparable to the information contained in the pro forma
condensed combined income statements on pages 3 and 4. The above data are
presented for informational purposes only and are not indicative of the
results of operations that actually would have occurred if the merger with
Dreyfus and Mellon's acquisition of TBC had been completed on January 1, 1993.
See accompanying "Notes to Pro Forma Condensed Combined Financial Statements."
</TABLE>
7
<PAGE> 9
<TABLE>
MELLON BANK CORPORATION AND SUBSIDIARIES,
THE BOSTON COMPANY, INC. AND SUBSIDIARIES AND
THE DREYFUS CORPORATION AND SUBSIDIARIES*
PRO FORMA CONDENSED COMBINED INCOME STATEMENT (a)
YEAR ENDED DECEMBER 31, 1993
(UNAUDITED)
<CAPTION>
PRO FORMA
MELLON AND
THE BOSTON PRO FORMA
(DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS; SHARES IN THOUSANDS) COMPANY DREYFUS COMBINED
---------- ------- --------
<S> <C> <C> <C>
Interest revenue $ 2,122 $ 24 $ 2,146
Interest expense 754 1 755
------- ------- -------
Net interest revenue 1,368 23 1,391
Provision for credit losses 128 - 128
------- ------- -------
Net interest revenue after provision for credit losses 1,240 23 1,263
Fee revenue 1,342 348 1,690
Gains on sale of securities 87 13 100
------- ------- -------
Total noninterest revenue 1,429 361 1,790
Operating expense 1,861 226 2,087
------- ------- -------
Income before income taxes 808 158 966
Provision for income taxes 319 59 378
------- ------- -------
Net income $ 489 $ 99 $ 588
======= ======= =======
Net income applicable to common stock $ 425 $ 99 $ 524
======= ======= =======
Weighted average common shares and common stock equivalents: (c)
Primary 66,475 37,352 99,351
Fully diluted 66,566 37,408 99,491
Net income per common share:
Primary $ 6.48 $ 2.67 $ 5.32
Fully diluted 6.48 2.66 5.31
<FN>
* This pro forma condensed combined income statement is presented as if
Mellon's acquisition of The Boston Company, Inc. (TBC) had been effective
January 1, 1993 as shown in further detail in Mellon's Current Report on Form
8-K dated July 15, 1994. The first column above combines TBC's results of
operations for the period January 1, 1993 through May 20, 1993 and Mellon's
results of operations for the year ended December 31, 1993, which included
TBC's results of operations from May 21, 1993 to December 31, 1993. The
first column also reflects a number of assumptions relating to the funding of
the purchase price, the issuance of Mellon common stock and warrants, the
amortization of goodwill, the elimination of $175 million of nonrecurring
merger expenses recorded by Mellon and other adjustments, as further
explained in Mellon's Current Report on Form 8-K dated July 15, 1994. The
elimination of such nonrecurring merger expenses and certain other
adjustments are not reflected in the pro forma condensed combined income
statements of Mellon and Dreyfus presented on pages 3 and 4. Accordingly,
the pro forma information presented above is not directly comparable to the
information contained in the pro forma condensed combined income statements
on pages 3 and 4. The above data are presented for informational purposes
only and are not indicative of the results of operations that actually would
have occurred if the merger with Dreyfus and Mellon's acquisition of TBC had
been completed on January 1, 1993.
See accompanying "Notes to Pro Forma Condensed Combined Financial Statements."
</TABLE>
8
<PAGE> 10
NOTES TO PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS
<TABLE>
<S> <C>
(a) The Dreyfus historical income statement and balance sheet
classifications presented herein were reclassified to be consistent
with the presentation used by Mellon.
Mellon adopted Statement of Financial Accounting Standards
(FAS) No. 109, "Accounting for Income Taxes," on a prospective
basis beginning in 1993. Dreyfus adopted FAS 109 on a prospective
basis beginning in 1992. No adjustments were made to the pro forma
condensed combined financial statements to conform Dreyfus' financial
statements to Mellon's for 1992. The effect of adopting FAS 109 on
both Mellon's 1993 and Dreyfus' 1992 financial statements was not
material.
FAS 114, "Accounting by Creditors for Impairment of a Loan,"
was issued in May 1993, and is required for fiscal years beginning
after December 15, 1994, with earlier application permitted. FASB
Interpretation No. 39, "Offsetting of Amounts Related to Certain
Contracts," was issued in March 1992, and is required for fiscal years
beginning after December 15, 1993, with earlier application permitted.
Neither Dreyfus nor Mellon had adopted FAS 114 through June 30, 1994.
Both Dreyfus and Mellon adopted FASB Interpretation No. 39 effective
January 1, 1994.
(b) Pro forma adjustments to common stock, additional paid-in capital and
treasury stock at June 30, 1994 reflect the combination of Dreyfus
and Mellon, accounted for as a pooling-of-interests, through the
assumed exchange of 32.2 million shares of Mellon common stock at
June 30, 1994 for all outstanding shares of Dreyfus common stock at
an exchange ratio of 0.88017 shares of Mellon common stock for each
share of Dreyfus common stock and the retirement of Dreyfus common
stock held in Dreyfus' treasury. Under generally accepted accounting
principles, the book values of the assets and liabilities of Dreyfus
were combined with those of Mellon. In addition, the income
statements of Dreyfus were combined with the income statements of
Mellon on a retroactive basis.
(c) Pro forma weighted average shares and common stock equivalents
for the six-month periods ended June 30, 1994 and 1993, and
each of the three years in the period ended December 31, 1993 reflect
the conversion of each share of outstanding Dreyfus common stock and
common stock equivalent that is dilutive to net income per share
computations to 0.88017 shares of Mellon common stock.
(d) The pro forma condensed combined income statements do not reflect
the $104 million or, $79 million after-tax, of merger expenses
and $15 million or, $10 million after-tax, on losses on the disposition
of securities available for sale which were recorded in the quarter
the merger was consummated, since these items are nonrecurring. Merger
expenses include: $25 million of expense related to the write-down of
certain facilities and assets; $42 million of expense primarily
related to estimated required payouts due under pre-existing
employee benefit programs and severance programs; and $37 million
of expense related to professional fees, proxy solicitation
and other expenses.
From July 1, 1994, through September 30, 1994, Dreyfus sold
securities available for sale and other investments that Mellon
Bank was not permitted to hold or that did not fit the interest rate
or credit risk characteristics required by Mellon. Such securities and
investments had been carried at $322 million and were sold for $307
million, for a $15 million pre-tax loss ($10 million after-tax loss);
the adjustments to the pro forma balance sheet reflects these sales.
The loss did not impact total equity since Dreyfus' June 30, 1994
equity had included a mark-to-market adjustment, in accordance with
FAS No. 115. The $307 million proceeds on sales were used to reduce
short-term borrowings.
(e) The pro forma adjustments to the liabilities and equity of the
condensed combined balance sheet also reflects the issuance of Mellon
common stock to holders of options and "Book Value" shares under the
Dreyfus 1982 Incentive Stock Option Plan. This issuance was recorded
as a $4 million increase to common stock and additional paid-in
capital, a reversal of the $1 million liability recorded to reflect
book value appreciation expensed to date, and a $3 million charge
to retained earnings.
9
</TABLE>
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