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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 13E-4
Issuer Tender Offer Statement
(Pursuant to Section 13(e)(1) of the Securities Exchange Act of 1934)
MICHIGAN NATIONAL CORPORATION
(Name of Issuer)
MICHIGAN NATIONAL CORPORATION
(Name of Person(s) Filing Statement)
COMMON STOCK, PAR VALUE $10.00 PER SHARE
(Title of Class of Securities)
594563 108
(Cusip Number of Class of Securities)
LAWRENCE L. GLADCHUN, ESQ.
SENIOR VICE PRESIDENT
GENERAL COUNSEL AND SECRETARY
MICHIGAN NATIONAL CORPORATION
27777 INKSTER ROAD
FARMINGTON HILLS, MI 48334
(810) 473-3000
(Name, Address and Telephone Number of Person Authorized
to receive Notices and Communications on Behalf of the Person(s) Filing
Statement)
COPY TO:
EDWARD D. HERLIHY, ESQ.
WACHTELL, LIPTON, ROSEN & KATZ
51 WEST 52ND STREET
NEW YORK, NEW YORK 10019
(212) 403-1000
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NOVEMBER 3, 1994
(Date Tender Offer First Published, Sent or Given to Security Holders)
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CALCULATION OF FILING FEE
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TRANSACTION VALUATION: * $167,278,500 AMOUNT OF FILING FEE: * $33,455.70
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/ / Check box if any part of the fee is offset as provided by Rule 0-11(A)(2)
and identify the filing with which the offsetting fee was previously paid.
Identify the previous filing by Registration Statement Number, or the Form
or Schedule and the date of its filing.
<TABLE>
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Amount Previously Paid: N/A Filing Party: N/A
Form or Registration No.: N/A Date Filed: N/A
</TABLE>
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* Based upon purchase of 1,858,650 Shares at the maximum tender offer price, $90
per Share
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ITEM 1. SECURITY AND ISSUER.
(a) The Issuer of the securities to which this Issuer Tender Offer
Statement on Schedule 13E-4 (the "Statement") relates is Michigan National
Corporation, a Michigan corporation (the "Company"), and the address of its
principal executive office is 27777 Inkster Road, Farmington Hills, MI
48334.
(b) This Statement relates to a tender offer by the Company to
purchase 1,858,650 shares (or such lesser number of shares as are validly
tendered) of its common stock, par value $10 per share (the "Shares")
(including the associated preferred share purchase rights), at prices, net
to the seller in cash, not greater than $90 nor less than $78 per Share,
specified by shareholders, upon the terms and subject to the conditions set
forth in the Offer to Purchase, dated November 3, 1994 (the "Offer to
Purchase"), and in the related Letter of Transmittal (which together
constitute the "Offer"), copies of which are filed as Exhibits (a)(1) and
(a)(2), respectively. The information set forth in the "Introduction,"
"Section 1. Number of Shares; Proration," "Section 8. Interest of Directors
and Executive Officers; Transactions and Arrangements Concerning the
Shares," "Section 10. Certain Information About the Company; Background and
Purpose of the Offer" and "Section 15. Extension of the Offer; Termination;
Amendments" of the Offer to Purchase is incorporated herein by reference.
(c) The information set forth in "Section 7. Price Range of Shares;
Dividends" of the Offer to Purchase is incorporated herein by reference.
(d) This Statement is being filed by the Issuer.
ITEM 2. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a)-(b) The information set forth in "Section 9. Source and Amount of
Funds" of the Offer to Purchase is incorporated herein by reference.
ITEM 3. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE ISSUER OR
AFFILIATE.
The information set forth in the "Introduction" and "Section 10. Certain
Information About the Company; Background and Purpose of the Offer" of the Offer
to Purchase is incorporated herein by reference.
(a)-(j) The information set forth in the "Introduction," "Section 8.
Interest of Directors and Executive Officers; Transactions and Arrangements
Concerning the Shares," "Section 9. Source and Amount of Funds," "Section
10. Certain Information About the Company; Background and Purpose of the
Offer" and "Section 12. Effects of the Offer on the Market for Shares;
Registration under the Exchange Act" of the Offer to Purchase is
incorporated herein by reference.
ITEM 4. INTEREST IN SECURITIES OF THE ISSUER.
The information set forth in "Section 8. Interest of Directors and
Executive Officers; Transactions and Arrangements Concerning the Shares" of the
Offer to Purchase is incorporated herein by reference.
ITEM 5. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO
THE ISSUER'S SECURITIES.
The information set forth in the "Introduction" and "Section 8. Interest of
Directors and Executive Officers; Transactions and Arrangements Concerning the
Shares" of the Offer to Purchase is incorporated herein by reference.
ITEM 6. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED.
The information set forth in the "Introduction" and "Section 16. Fees and
Expenses" of the Offer to Purchase is incorporated herein by reference.
2
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ITEM 7. FINANCIAL INFORMATION.
(a)-(b) The information set forth in "Section 10. Certain Information
About the Company; Background and Purpose of the Offer" of the Offer to
Purchase is incorporated herein by reference.
ITEM 8. ADDITIONAL INFORMATION.
(a) Not applicable.
(b) The information set forth in "Section 13. Regulatory Approvals" of
the Offer to Purchase is incorporated herein by reference.
(c) The information set forth in "Section 12. Effects of the Offer on
the Market for Shares; Registration under the Exchange Act" of the Offer to
Purchase is incorporated herein by reference.
(d) Not applicable.
(e) Reference is hereby made to the Offer to Purchase and the related
Letter of Transmittal, copies of which are attached hereto as Exhibits
(a)(1) and (a)(2), respectively, and incorporated in their entirety herein
by reference.
ITEM 9. MATERIAL TO BE FILED AS EXHIBITS.
<TABLE>
<S> <C>
99.(a)(1) Offer to Purchase, dated November 3, 1994
99.(a)(2) Letter of Transmittal
99.(a)(3) Notice of Guaranteed Delivery
99.(a)(4) Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees
99.(a)(5) Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust Companies
and Other Nominees
99.(a)(6) Guidelines for Certification of Taxpayer Identification Number on Substitute
Form W-9
99.(a)(7) Press Release issued by the Company on November 3, 1994
99.(a)(8) Letter to the Company's Shareholders from Robert J. Mylod, Chairman of the Board
and Chief Executive Officer, of the Company, dated November 3, 1994
99.(a)(9) Summary Advertisement dated November 3, 1994
99.(a)(10) Letter to Participants in the Michigan National Corporation Deferred
Compensation Plan
99.(a)(11) Letter to Participants in the Michigan National Corporation Employee Stock
Ownership Plan
99.(c)(1) Dealer Manager Agreement dated as of November 3, 1994, among the Company, Keefe,
Bruyette & Woods, Inc. and CS First Boston Corporation
99.(d) Not applicable
99.(e) Not applicable
99.(f) Not applicable
</TABLE>
3
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SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
Dated: November 3, 1994
MICHIGAN NATIONAL CORPORATION
/s/ ROBERT J. MYLOD
----------------------------------------
Name: Robert J. Mylod
Title: Chairman of the Board and
Chief Executive Officer
4
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EXHIBIT INDEX
<TABLE>
<CAPTION>
PAGE IN
SEQUENTIALLY
EXHIBIT NO. DESCRIPTION NUMBERED COPY
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99.(a)(1) Offer to Purchase, dated November 3, 1994.........................
99.(a)(2) Letter of Transmittal.............................................
99.(a)(3) Notice of Guaranteed Delivery.....................................
99.(a)(4) Letter to Brokers, Dealers, Commercial Banks, Trust Companies and
Other Nominees....................................................
99.(a)(5) Letter to Clients for use by Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees................................
99.(a)(6) Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9...............................................
99.(a)(7) Press Release issued by the Company on November 3, 1994...........
99.(a)(8) Letter to the Company's shareholders from Robert J. Mylod,
Chairman of the Board and Chief Executive Officer, of the Company,
dated
November 3, 1994..................................................
99.(a)(9) Summary Advertisement dated November 3, 1994......................
99.(a)(10) Letter to Participants in the Michigan National Corporation
Deferred Compensation Plan........................................
99.(a)(11) Letter to Participants in the Michigan National Corporation
Employee Stock Ownership Plan.....................................
99.(c)(1) Dealer Manager Agreement dated as of November 3, 1994, among the
Company, Keefe, Bruyette & Woods, Inc. and CS First Boston
Corporation.......................................................
</TABLE>
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EXHIBIT 99.(a)(1)
MICHIGAN NATIONAL CORPORATION
OFFER TO PURCHASE FOR CASH
UP TO 1,858,650 SHARES OF ITS COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED SHARE PURCHASE RIGHTS)
AT A PURCHASE PRICE NOT GREATER THAN
$90 NOR LESS THAN $78 PER SHARE
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT 5:00 P.M.,
NEW YORK CITY TIME, ON FRIDAY, DECEMBER 2, 1994, UNLESS THE OFFER IS EXTENDED.
Michigan National Corporation, a Michigan corporation (the "Company"),
hereby invites its shareholders to tender shares (the "Shares") of its common
stock, par value $10.00 per share (including the associated Preferred Share
Purchase Rights (the "Rights") issued pursuant to the Rights Agreement dated as
of April 25, 1988 between the Company and Mellon Bank, N.A., to the Company at
prices, net to the seller in cash, not greater than $90 nor less than $78 per
Share, specified by such shareholders, upon the terms and subject to the
conditions set forth in this Offer to Purchase and in the related Letter of
Transmittal (which together constitute the "Offer"). The Company will determine
a single per Share price (not greater than $90 nor less than $78 per Share) (the
"Purchase Price") that it will pay for Shares validly tendered pursuant to the
Offer, taking into account the number of Shares so tendered and the prices
specified by tendering shareholders. The Company will select the Purchase Price
that will allow it to buy 1,858,650 Shares (or such lesser number of Shares as
are validly tendered at prices not greater than $90 nor less than $78 per Share)
pursuant to the Offer. All Shares validly tendered at prices at or below the
Purchase Price and not withdrawn will be purchased at the Purchase Price, net to
the seller in cash, upon the terms and subject to the conditions of the Offer,
including the proration terms hereof.
THE OFFER IS NOT CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING
TENDERED. The Offer is, however, subject to certain other conditions. See
Section 6.
The Shares are reported for trading on the National Market System of the
National Association of Securities Dealers Automated Quotation System
("NASDAQ/NMS") under the symbol "MNCO." On November 2, 1994, the last full
trading day prior to the announcement and commencement of the Offer, the closing
per Share sales price on the NASDAQ/NMS was $77 3/4. SHAREHOLDERS ARE URGED TO
OBTAIN CURRENT MARKET QUOTATIONS FOR THE SHARES. See Section 7.
THE BOARD OF DIRECTORS HAS UNANIMOUSLY APPROVED THE OFFER. HOWEVER, NEITHER
THE COMPANY NOR ITS BOARD OF DIRECTORS MAKES ANY RECOMMENDATION TO ANY
SHAREHOLDER AS TO WHETHER TO TENDER OR REFRAIN FROM TENDERING SHARES.
SHAREHOLDERS MUST MAKE THEIR OWN DECISIONS WHETHER TO TENDER SHARES AND, IF SO,
HOW MANY SHARES TO TENDER AND THE PRICE OR PRICES AT WHICH SHARES SHOULD BE
TENDERED. THE COMPANY HAS BEEN ADVISED THAT NONE OF ITS DIRECTORS OR EXECUTIVE
OFFICERS INTENDS TO TENDER ANY SHARES PURSUANT TO THE OFFER.
The Offer is not being made to holders of the Cancellable Mandatory Stock
Purchase Contracts (the "Stock Purchase Contracts") issued by the Company in
conjunction with issuance of the Company's Subordinated Debentures due November
10, 1998. A separate offer (the "Contract Offer") to purchase for cash any or
all of the Stock Purchase Contracts at a purchase price of $21.625 per Stock
Purchase Contract is being made simultaneously with the Offer. In the event the
Purchase Price pursuant to the Offer is greater than $78, the Company will (x)
amend the Contract Offer to increase the purchase price thereunder to equal the
Purchase Price pursuant to the Offer less $56.375, which is the exercise price
of the Stock Purchase Contracts, and (y) extend the period of the Contract Offer
(but not the Offer) for an additional ten business days. Holders of Stock
Purchase Contracts may (i) participate in the Contract Offer by tendering their
Stock Purchase Contracts in accordance with the terms of the Contract Offer,
(ii) participate in the Offer by exercising their Stock Purchase Contracts in
accordance with their terms and tendering in the Offer the Shares issuable upon
such exercise, or (iii) do nothing and retain their Stock Purchase Contracts.
See Section 11.
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THE DEALER MANAGERS FOR THE OFFER ARE:
KEEFE, BRUYETTE & WOODS, INC. CS FIRST BOSTON
NOVEMBER 3, 1994
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IMPORTANT
Any shareholder desiring to tender all or any portion of his Shares should
either (1) complete and sign the Letter of Transmittal or a facsimile copy
thereof in accordance with the instructions in the Letter of Transmittal, mail
or deliver it and any other required documents to First Chicago Trust Company of
New York (the "Depositary"), and either mail or deliver his stock certificates
for such Shares to the Depositary or follow the procedure for book-entry
delivery set forth in Section 3, or (2) request his broker, dealer, commercial
bank, trust company or other nominee to effect the transaction for him. A
shareholder having Shares registered in the name of a broker, dealer, commercial
bank, trust company or other nominee must contact that broker, dealer,
commercial bank, trust company or other nominee if such shareholder desires to
tender such Shares. Shareholders who desire to tender Shares and whose
certificates for such Shares are not immediately available or who cannot comply
with the procedure for book-entry transfer by the expiration of the Offer must
tender such Shares by following the procedures for guaranteed delivery set forth
in Section 3. SHAREHOLDERS MUST PROPERLY COMPLETE THE LETTER OF TRANSMITTAL
INCLUDING THE SECTION OF THE LETTER OF TRANSMITTAL RELATING TO THE PRICE AT
WHICH THEY ARE TENDERING SHARES IN ORDER TO EFFECT A VALID TENDER OF THEIR
SHARES.
Questions and requests for assistance or for additional copies of this
Offer to Purchase, the Letter of Transmittal or the Notice of Guaranteed
Delivery may be directed to the Information Agent or either Dealer Manager at
their respective addresses and telephone numbers set forth on the back cover of
this Offer to Purchase.
NO PERSON HAS BEEN AUTHORIZED TO MAKE ANY RECOMMENDATION ON BEHALF OF THE
COMPANY AS TO WHETHER SHAREHOLDERS SHOULD TENDER OR REFRAIN FROM TENDERING
SHARES PURSUANT TO THE OFFER. NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS IN CONNECTION WITH THE OFFER OTHER
THAN THOSE CONTAINED IN THIS OFFER TO PURCHASE OR IN THE LETTER OF TRANSMITTAL.
IF GIVEN OR MADE, SUCH RECOMMENDATION, INFORMATION OR REPRESENTATIONS MUST NOT
BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY.
2
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TABLE OF CONTENTS
<TABLE>
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SECTION PAGE
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Introduction.................................................................. 3
1. Number of Shares; Proration................................................... 4
2. Tenders by Owners of Fewer than 100 Shares.................................... 6
3. Procedure for Tendering Shares................................................ 6
4. Withdrawal Rights............................................................. 9
5. Purchase of Shares and Payment of Purchase Price.............................. 10
6. Certain Conditions of the Offer............................................... 10
7. Price Range of Shares; Dividends.............................................. 12
8. Interest of Directors and Executive Officers; Transactions and Arrangements
Concerning the Shares......................................................... 12
9. Source and Amount of Funds.................................................... 13
10. Certain Information About the Company; Background and Purpose of the Offer.... 13
11. The Contract Offer............................................................ 21
12. Effects of the Offer on the Market for Shares; Registration under the Exchange
Act........................................................................... 22
13. Regulatory Approvals.......................................................... 22
14. Certain Federal Income Tax Consequences....................................... 23
15. Extension of the Offer; Termination; Amendments............................... 25
16. Fees and Expenses............................................................. 26
17. Miscellaneous................................................................. 26
</TABLE>
TO THE HOLDERS OF COMMON STOCK OF
MICHIGAN NATIONAL CORPORATION:
The Company hereby invites its shareholders to tender Shares to the Company
at prices, net to the seller in cash, not greater than $90 nor less than $78 per
Share, specified by such shareholders, upon the terms and subject to the
conditions set forth in the Offer. The Company will determine a single per Share
Purchase Price (not greater than $90 nor less than $78 per Share) that it will
pay for Shares validly tendered pursuant to the Offer taking into account the
number of Shares so tendered and the prices specified by tendering shareholders.
The Company will select the Purchase Price which will allow it to buy 1,858,650
Shares (or such lesser number of Shares as are validly tendered at prices not
greater than $90 nor less than $78 per Share) pursuant to the Offer. All Shares
validly tendered at prices at or below the Purchase Price will be purchased at
the Purchase Price, net to the seller in cash, upon the terms and subject to the
conditions of the Offer, including the proration terms described below.
THE OFFER IS NOT CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING
TENDERED. THE OFFER IS, HOWEVER, SUBJECT TO CERTAIN OTHER CONDITIONS. SEE
SECTION 6.
If, before the Expiration Date (as defined in Section 1), more than
1,858,650 Shares (or such greater number of Shares as the Company may elect to
purchase) are validly tendered at or below the Purchase Price, the Company will
accept Shares for purchase first from all Odd Lot Owners (as defined in Section
2) who validly tender all their Shares at or below the Purchase Price and then
on a pro rata basis from all other shareholders who validly tender Shares at or
below the Purchase Price. See Sections 1 and 2. The Company will return all
Shares not purchased under the Offer, including Shares tendered and not
withdrawn at prices greater than the Purchase Price and Shares not purchased
because of proration. Tendering shareholders will not be obligated to pay
brokerage fees or commissions, solicitation fees or, subject to Instruction 7 of
the Letter of Transmittal, stock transfer taxes on the Company's purchase of
Shares pursuant to the Offer. In addition, the Company will pay all fees and
expenses of Keefe, Bruyette & Woods, Inc. and CS First Boston Corporation (each,
a "Dealer Manager," and collectively, the "Dealer Managers"), First Chicago
Trust Company of New York (the "Depositary") and Georgeson & Company Inc. (the
"Information Agent") in connection with the Offer. See Section 16.
3
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NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS MAKES ANY RECOMMENDATION TO
ANY SHAREHOLDER AS TO WHETHER TO TENDER OR REFRAIN FROM TENDERING SHARES.
Shareholders must make their own decisions whether to tender Shares and, if so,
how many Shares to tender and the price or prices at which Shares should be
tendered. The Company has been advised that none of its directors or executive
officers intends to tender any Shares pursuant to the Offer.
The Company is making the Offer as part of a comprehensive restructuring
developed by the Company to enhance shareholder value. As discussed in "Section
10. Certain Information About the Company; Background and Purpose of the Offer,"
the restructuring is intended to enhance shareholder value by focusing the
Company's resources on its Michigan-based, core banking business, by
streamlining and enhancing the efficiency and profitability of that core
business, and by repositioning the Company's balance sheet to increase return on
equity by redeploying the portion of the Company's equity capital that is not
necessary for the Company's Michigan-based, core banking business. Following
completion of the Offer and the Contract Offer, the Company and Michigan
National Bank, a national banking association and the Company's principal
operating subsidiary ("MNB") will continue to have strong capital positions and
will continue to qualify as "well capitalized" institutions under the prompt
corrective action scheme enacted by the Federal Deposit Insurance Corporation
Improvements Act of 1991. On a pro forma basis as of September 30, 1994, giving
effect to the Offer and the Contract Offer at the maximum Purchase Prices of $90
per Share (or, in the case of the Contract Offer, $90 per Share equivalent), and
assuming acceptance of the maximum number of Shares in the Offer and Stock
Purchase Contracts in the Contract Offer, the Company would have had an equity
to asset ratio of 8.6%, a Total risk-based capital ratio of 10.39% and a
leverage ratio of 6.98%. See Section 10.
The Offer will enable shareholders to sell a portion of their Shares while
retaining a continuing equity interest in the Company if they so desire. The
Offer will increase the Company's leverage, with an attendant increase in the
risks and rewards for shareholders who retain a continuing equity interest in
the Company. In addition, shareholders who determine not to accept the Offer
will realize a proportionate increase in their relative equity interest in the
Company, and thus in the Company's future earnings and assets, subject to
increased risks resulting from higher leverage and to the Company's ability to
issue additional Shares or other equity securities in the future.
The Offer may provide shareholders who are considering a sale of all or a
portion of their Shares the opportunity to determine the price or prices (not
greater than $90 nor less than $78 per Share) at which they are willing to sell
their Shares and, if any such Shares are purchased pursuant to the Offer, to
sell those Shares for cash without the usual transaction costs associated with
open-market sales. The Offer also gives shareholders the opportunity to sell
Shares at prices greater than market prices prevailing prior to announcement of
the Offer.
As of October 29, 1994, there were 15,324,241 Shares outstanding, 507,225
Shares issuable upon exercise of stock options under the Company's stock option
plans and 973,126 Shares issuable pursuant to the Stock Purchase Contracts. The
1,858,650 Shares that the Company is offering to purchase represent
approximately 12% of the Shares outstanding as of October 29, 1994 and
approximately 11% of the fully diluted Shares outstanding as of such date.
The Company plans to obtain the funds needed for the Offer from cash on
hand of approximately $235 million. See Section 9.
1. NUMBER OF SHARES; PRORATION.
Upon the terms and subject to the conditions of the Offer, the Company will
accept for payment and purchase 1,858,650 Shares or such lesser number of Shares
as are validly tendered on or prior to the Expiration Date at a price
(determined in the manner set forth below) not greater than $90 nor less than
$78 per Share. The term "Expiration Date" means 5:00 p.m., New York City time,
on Friday, December 2, 1994, unless the Company, in its sole discretion, shall
have extended the period of time during which the Offer is open, in which event
the term "Expiration Date" shall refer to the latest time and date at which the
Offer, as so extended by the Company, shall expire. See Section 15 for a
description of the Company's right to extend the time during which the Offer is
open and to delay, terminate or amend the Offer. See also Section 6.
4
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Subject to Section 2, if the Offer is oversubscribed, Shares tendered at or
below the Purchase Price prior to the Expiration Date will be subject to
proration. The proration period also expires on the Expiration Date.
The Company will, upon the terms and subject to the conditions of the
Offer, determine the Purchase Price (not greater than $90 nor less than $78 per
Share) that it will pay for Shares validly tendered pursuant to the Offer taking
into account the number of Shares so tendered and the prices specified by
tendering shareholders. The Company will select a single per Share Purchase
Price that will allow it to buy 1,858,650 Shares (or such lesser number as are
validly tendered at prices not greater than $90 nor less than $78 per Share)
pursuant to the Offer. The Company reserves the right, in its sole discretion,
to purchase more than 1,858,650 Shares pursuant to the Offer.
If (i) the Company increases or decreases the price to be paid for Shares,
increases the number of Shares being sought and any such increase in the number
of Shares being sought exceeds 2% of the outstanding Shares, or decreases the
number of Shares being sought, and (ii) the Offer is scheduled to expire less
than ten business days from and including the date that notice of such increase
or decrease is first published, sent or given in the manner specified in Section
15, the Offer will be extended for ten business days from and including the date
of such notice. For purposes of the Offer, a "business day" means any day other
than a Saturday, Sunday or federal holiday and consists of the time period from
12:01 a.m. through 12:00 midnight, New York City time.
In accordance with Instruction 5 of the Letter of Transmittal, each
shareholder desiring to tender Shares must specify the price or prices (not
greater than $90 nor less than $78 per Share) at which such shareholder is
willing to have the Company purchase his Shares. All Shares purchased pursuant
to the Offer will be purchased at the Purchase Price. All Shares not purchased
pursuant to the Offer, including Shares tendered at prices greater than the
Purchase Price and Shares not purchased because of proration, will be returned
to the tendering shareholders at the Company's expense as promptly as
practicable following the Expiration Date.
If the number of Shares validly tendered prior to the Expiration Date at or
below the Purchase Price is less than or equal to 1,858,650 Shares (or such
greater number of Shares as the Company may elect to purchase pursuant to the
Offer), the Company will, upon the terms and subject to the conditions of the
Offer, purchase at the Purchase Price all Shares so tendered.
Upon the terms and subject to the conditions of the Offer, in the event
that prior to the Expiration Date more than 1,858,650 Shares (or such greater
number of Shares as the Company elects to purchase) are validly tendered at or
below the Purchase Price, the Company will accept Shares for purchase in the
following order of priority:
(a) first, all Shares validly tendered at or below the Purchase Price
prior to the Expiration Date by any Odd Lot Owner (as defined in Section 2)
who:
(1) tenders all Shares beneficially owned by such Odd Lot Owner at
or below the Purchase Price (partial tenders will not qualify for this
preference); and
(2) completes the box captioned "Odd Lots" on the Letter of
Transmittal and, if applicable, on the Notice of Guaranteed Delivery;
and
(b) then, after purchase of all of the foregoing Shares, all other
Shares validly tendered at or below the Purchase Price before the
Expiration Date on a pro rata basis, if necessary (with adjustments to
avoid purchases of fractional shares).
In the event that proration of tendered Shares is required, the Company
will determine the final proration factor as promptly as practicable after the
Expiration Date. Although the Company does not expect to be able to announce the
final results of such proration until approximately seven over-the-counter
("OTC") trading days after the Expiration Date, it will announce preliminary
results of proration by press release as promptly as practicable after the
Expiration Date. Shareholders may obtain such preliminary information from the
Information Agent and may be able to obtain such information from their brokers
or financial advisors.
5
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On April 19, 1988, the Company's Board of Directors declared a dividend
distribution of one Right for each Share outstanding on April 29, 1988 (the
"Record Date"). Shares issued subsequent to the Record Date automatically
receive the Rights. The Rights expire on April 28, 1998 unless redeemed earlier
by the Company. Each Right entitles the registered holder to purchase from the
Company a unit consisting of one one-hundredth of a share of Series B Junior
Participating Preferred Stock of the Company at an exercise price of $170,
subject to adjustment to prevent dilution. The Rights are not currently
exercisable and trade together with the Shares associated therewith. The Rights
will not become exercisable or separately tradeable as a result of the Offer.
Absent circumstances causing the Rights to become exercisable or separately
tradeable prior to the Expiration Date, the tender of any Shares pursuant to the
Offer will include the tender of the associated Rights. No separate
consideration will be paid for such Rights. Upon the purchase of Shares by the
Company pursuant to the Offer, the sellers of the Shares so purchased will no
longer own the Rights associated with such Shares.
As described in Section 14, the number of Shares that the Company will
purchase from a shareholder may affect the federal income tax consequences to
the shareholder of such purchase and therefore may be relevant to a
shareholder's decision whether to tender Shares.
2. TENDERS BY OWNERS OF FEWER THAN 100 SHARES.
The Company, upon the terms and subject to the conditions of the Offer,
will accept for payment, without proration, all Shares validly tendered on or
prior to the Expiration Date at or below the Purchase Price by or on behalf of
shareholders who beneficially held, as of the close of business on November 2,
1994, and continue to own beneficially as of the Expiration Date, an aggregate
of fewer than 100 Shares ("Odd Lot Owners"). To avoid proration, however, an Odd
Lot Owner must validly tender at or below the Purchase Price all Shares that
such Odd Lot Owner beneficially owns; partial tenders will not qualify for this
preference. This preference is not available to holders of 100 or more Shares,
even if such holders have separate stock certificates for fewer than 100 Shares.
Any Odd Lot Owner wishing to tender all Shares beneficially owned by him free of
proration pursuant to this Offer must complete the section captioned "Odd Lots"
in the Letter of Transmittal and, if applicable, on the Notice of Guaranteed
Delivery. By accepting the Offer, a shareholder owning fewer than 100 Shares
would not only avoid the payment of brokerage commissions but would also avoid
any applicable odd lot discounts payable on a sale of Shares in a transaction
effected on a securities exchange.
The special Odd Lot purchase rules described above do not apply to any
Shares held in the Company's Employee Stock Ownership Plan or its Deferred
Compensation Plan.
3. PROCEDURE FOR TENDERING SHARES.
PROPER TENDER OF SHARES. For Shares to be validly tendered pursuant to the
Offer:
(a) the certificates for such Shares (or confirmation of receipt of
such Shares pursuant to the procedures for book-entry transfer set forth
below), together with a properly completed and duly executed Letter of
Transmittal (or facsimile thereof) with any required signature guarantees,
and any other documents required by the Letter of Transmittal, must be
received on or before the Expiration Date by the Depositary at one of its
addresses set forth on the back cover of this Offer to Purchase; or
(b) the tendering shareholder must comply with the guaranteed delivery
procedure set forth below.
As specified in Instruction 5 of the Letter of Transmittal, each
shareholder desiring to tender Shares pursuant to the Offer must properly
indicate in the section captioned "Price (In Dollars) Per Share At Which Shares
Are Being Tendered" on the Letter of Transmittal or facsimile thereof the price
(in multiples of $.25) at which his Shares are being tendered; provided,
however, than a shareholder may check the box in that section indicating that he
is tendering all of his Shares at the Purchase Price. Shareholders desiring to
tender Shares at more than one price must complete separate Letters of
Transmittal for each price at which Shares are being tendered, except that the
same Shares cannot be tendered (unless properly withdrawn previously in
6
<PAGE> 7
accordance with the terms of the Offer) at more than one price. In order to
validly tender Shares, one and only one price box must be checked in the
appropriate section on each Letter of Transmittal.
In addition, Odd Lot Owners who tender all their Shares must complete the
section entitled "Odd Lots" in the Letter of Transmittal and, if applicable, on
the Notice of Guaranteed Delivery in order to qualify for the preferential
treatment available to Odd Lot Owners as set forth in Section 1.
SIGNATURE GUARANTEES AND METHOD OF DELIVERY. No signature guarantee is
required on the Letter of Transmittal (i) if the Letter of Transmittal is signed
by the registered holder of the Shares exactly as the name of the registered
holder appears on the certificate (which term, for purposes of this Section 3,
includes any participant in The Depository Trust Company, the Midwest Securities
Trust Company or the Philadelphia Depository Trust Company (collectively, the
"Book-Entry Transfer Facilities") whose name appears on a security position
listing as the holder of the Shares) tendered therewith, and payment and
delivery are to be made directly to such registered holder, or (ii) if Shares
are tendered for the account of a member firm of a registered national
securities exchange, a member of the National Association of Securities Dealers,
Inc. or a commercial bank or trust company having an office, branch or agency in
the United States (each such entity, an "Eligible Institution"). In all other
cases, all signatures on the Letter of Transmittal must be Medallion guaranteed
by an Eligible Institution. See Instruction 1 of the Letter of Transmittal. If a
certificate representing Shares is registered in the name of a person other than
the signer of a Letter of Transmittal, or if payment is to be made, or Shares
not purchased or tendered are to be issued, to a person other than the
registered holder, the certificate must be endorsed or accompanied by an
appropriate stock power, in either case signed exactly as the name of the
registered holder appears on the certificate, with the signature on the
certificate or stock power Medallion guaranteed by an Eligible Institution. In
all cases, payment for Shares tendered and accepted for payment pursuant to the
Offer will be made only after timely receipt by the Depositary of certificates
for such Shares (or a timely confirmation of a book-entry transfer of such
Shares into the Depositary's account at one of the Book-Entry Transfer
Facilities), a properly completed and duly executed Letter of Transmittal (or
facsimile thereof) with any required signature guarantees and any other
documents required by the Letter of Transmittal. THE METHOD OF DELIVERY OF ALL
DOCUMENTS, INCLUDING STOCK CERTIFICATES, THE LETTER OF TRANSMITTAL AND ANY OTHER
REQUIRED DOCUMENTS, IS AT THE ELECTION AND RISK OF THE TENDERING SHAREHOLDER. IF
DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY
INSURED, IS RECOMMENDED.
FEDERAL INCOME TAX BACKUP WITHHOLDING. To prevent federal income tax backup
withholding equal to 31% of the gross payments made pursuant to the Offer, each
shareholder who does not otherwise establish an exemption from such withholding
must notify the Depositary of such shareholder's correct taxpayer identification
number (or certify that such taxpayer is awaiting a taxpayer identification
number) and provide certain other information by completing a Substitute Form
W-9 (included in the Letter of Transmittal). Foreign shareholders may be
required to submit Form W-8, certifying non-United States status, in order to
avoid backup withholding. See Instructions 12 and 13 of the Letter of
Transmittal.
EACH SHAREHOLDER SHOULD CONSULT HIS OWN TAX ADVISOR AS TO WHETHER SUCH
SHAREHOLDER IS SUBJECT TO OR EXEMPT FROM FEDERAL INCOME TAX WITHHOLDING.
For a discussion of certain other federal income tax consequences to
tendering shareholders, see Section 14.
BOOK-ENTRY DELIVERY. The Depositary will establish an account with respect
to the Shares at each of the Book-Entry Transfer Facilities for purposes of the
Offer within two business days after the date of this Offer to Purchase. Any
financial institution that is a participant in the Book-Entry Transfer
Facility's system may make book-entry delivery of the Shares by causing such
facility to transfer such Shares into the Depositary's account in accordance
with such facility's procedure for such transfer. Even though delivery of Shares
may be effected through book-entry transfer into the Depositary's account at one
of the Book-Entry Transfer Facilities, a properly completed and duly executed
Letter of Transmittal (or facsimile thereof), with any required signature
guarantees and other required documents must, in any case, be transmitted to and
received
7
<PAGE> 8
by the Depositary at one of its addresses set forth on the back cover of this
Offer to Purchase prior to the Expiration Date, or the guaranteed delivery
procedure set forth below must be followed. DELIVERY OF THE LETTER OF
TRANSMITTAL AND ANY OTHER REQUIRED DOCUMENTS TO ONE OF THE BOOK-ENTRY TRANSFER
FACILITIES DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY.
GUARANTEED DELIVERY. If a shareholder desires to tender Shares pursuant to
the Offer and such shareholder's certificates are not immediately available (or
the procedures for book-entry transfer cannot be completed on a timely basis) or
time will not permit all required documents to reach the Depositary by the
Expiration Date, such Shares may nevertheless be tendered provided that all of
the following conditions are satisfied:
(a) such tender is made by or through an Eligible Institution;
(b) the Depositary receives (by hand, mail, telegram or facsimile
transmission), on or prior to the Expiration Date, a properly completed and
duly executed Notice of Guaranteed Delivery substantially in the form the
Company has provided with this Offer to Purchase (indicating the price at
which the Shares are being tendered) and includes a guarantee by an
Eligible Institution in the form set forth in such Notice; and
(c) the certificates for all tendered Shares in proper form for
transfer (or confirmation of book-entry transfer of such Shares into the
Depositary's account at one of the Book-Entry Transfer Facilities),
together with a properly completed and duly executed Letter of Transmittal
(or facsimile thereof) and any other documents required by the Letter of
Transmittal, are received by the Depositary within five OTC trading days
after the date the Depositary receives such Notice of Guaranteed Delivery.
DETERMINATION OF VALIDITY; REJECTION OF SHARES; WAIVER OF DEFECTS; NO
OBLIGATION TO GIVE NOTICE OF DEFECTS. All questions as to the number of Shares
to be accepted, the price to be paid therefor, the form of documents and the
validity, form, eligibility (including the time of receipt) and acceptance for
payment of any tender of Shares will be determined by the Company, in its sole
discretion, which determination shall be final and binding on all parties. The
Company reserves the absolute right to reject any or all tenders it determines
not to be in proper form or the acceptance of or payment for which may be
unlawful. The Company also reserves the absolute right to waive any of the
conditions of the Offer or any defect or irregularity in the tender of any
particular Shares. No tender of Shares will be deemed to be validly made until
all defects and irregularities have been cured or waived. None of the Company,
either Dealer Manager, the Depositary, the Information Agent or any other person
is or will be obligated to give notice of any defects or irregularities in
tenders, and none of them will incur any liability for failure to give such
notice.
EMPLOYEE STOCK OWNERSHIP PLAN AND DEFERRED COMPENSATION PLAN AND TRUST. As
of October 29, 1994, the Company's Employee Stock Ownership Plan (the "ESOP")
and Deferred Compensation Plan and Trust (the "Deferred Compensation Plan")
owned 1,170,958 Shares and 1,080,625 Shares, respectively, of which 797,884 and
1,076,832 were allocated to the accounts of the respective participants. Shares
allocated to participants' accounts will, subject to the limitations of the
Employee Retirement Income Security Act of 1974, as amended, and applicable
regulations thereunder ("ERISA"), be tendered by the trustee of the respective
plans according to the instructions of participants to the Trustee. Decisions as
to whether to tender Shares not allocated to participants' accounts will made by
such trustees subject to the terms of the plan and ERISA. Each trustee will make
available to the respective participants whose accounts hold allocated Shares
all documents furnished to the shareholders in connection with the Offer
generally and will provide additional information in separate letters with
respect to the operations of the Offer to the participants of each of the ESOP
and the Deferred Compensation Plan. Each such participant will also receive a
form upon which the participant may instruct the trustee regarding the Offer.
Each participant may direct that all, some or none of the Shares allocated to
the participant's account be tendered. Participants will also be afforded
withdrawal rights (see "Section 4. Withdrawal Rights").
Under ERISA the Company will be prohibited from purchasing any Shares from
either the ESOP or the Deferred Compensation Plan (including Shares allocated to
the accounts of participants) if the Purchase
8
<PAGE> 9
Price is less than the prevailing market of the Shares on the date the Shares
are accepted for payment pursuant to the Offer. If Shares tendered from either
the ESOP or the Deferred Compensation Plan would have been accepted pursuant to
the terms of the Offer except for this prohibition, such Shares shall
automatically be deemed to be withdrawn.
DIVIDEND REINVESTMENT PLAN. Shareholders who participate in the Company's
Dividend Reinvestment Plan who want to tender Shares held under that plan
pursuant to the Offer should mark the appropriate box on the Letter of
Transmittal and follow the relevant instructions set out there.
RULE 14E-4. It is a violation of Rule 14e-4 promulgated under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), for a person
(directly or indirectly) to tender shares for his own account unless, at the
time of tender and at the end of the proration period (including any extension
thereof), the person so tendering (i) has a net long position equal to or
greater than the amount of (x) Shares tendered or (y) other securities
immediately convertible into, exercisable, or exchangeable for the amount of
Shares tendered and will acquire such Shares for tender by conversion, exercise
or exchange of such other securities, and (ii) will cause such Shares to be
delivered in accordance with the terms of the Offer. Rule 14e-4 provides a
similar restriction applicable to the tender or guarantee of a tender on behalf
of another person. The tender of Shares pursuant to any one of the procedures
described above will constitute the tendering shareholder's acceptance of the
terms and conditions of the Offer as well as the tendering shareholder's
representation and warranty that (i) such shareholder has a net long position in
the Shares being tendered within the meaning of Rule 14e-4, and (ii) the tender
of such Shares complies with Rule 14e-4. The Company's acceptance for payment of
Shares tendered pursuant to the Offer will constitute a binding agreement
between the tendering shareholder and the Company upon the terms and subject to
the conditions of the Offer.
4. WITHDRAWAL RIGHTS.
Except as otherwise provided in this Section 4, the tender of Shares
pursuant to the Offer is irrevocable. Shares tendered pursuant to the Offer may
be withdrawn at any time prior to the Expiration Date and, unless theretofore
accepted for payment by the Company, may also be withdrawn after 5:00 p.m., New
York City time, on Tuesday, January 3, 1995.
For a withdrawal to be effective, the Depositary must timely receive (at
one of its addresses set forth on the back cover of this Offer to Purchase) a
written, telegraphic or facsimile transmission notice of withdrawal. Such notice
of withdrawal must specify the name of the person who tendered the Shares to be
withdrawn, the number of Shares to be withdrawn and the name of the registered
holder, if different from that of the person who tendered such Shares. If the
certificates have been delivered or otherwise identified to the Depositary,
then, prior to the release of such certificates, the tendering shareholder must
also submit the serial numbers shown on the particular certificates evidencing
the Shares to be withdrawn and the signature on the notice of withdrawal must be
Medallion guaranteed by an Eligible Institution (except in the case of Shares
tendered by an Eligible Institution). If Shares have been tendered pursuant to
the procedure for book-entry transfer set forth in Section 3, the notice of
withdrawal must specify the name and the number of the account at the applicable
Book-Entry Transfer Facility to be credited with the withdrawn Shares and
otherwise comply with the procedures of such facility. All questions as to the
form and validity (including time of receipt) of notices of withdrawal will be
determined by the Company, in its sole discretion, which determination shall be
final and binding on all parties. None of the Company, either Dealer Manager,
the Depositary, the Information Agent or any other person is or will be
obligated to give notice of any defects or irregularities in any notice of
withdrawal, and none of them will incur any liability for failure to give such
notice. Any Shares properly withdrawn will thereafter be deemed not validly
tendered for purposes of the Offer. Withdrawn Shares may, however, be retendered
by the Expiration Date by again following any of the procedures described in
Section 3.
If the Company extends the Offer, is delayed in its purchase of Shares or
is unable to purchase Shares pursuant to the Offer for any reason, then, without
prejudice to the Company's rights under the Offer, the Depositary may, subject
to applicable law, retain on behalf of the Company all tendered Shares, and the
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<PAGE> 10
Shares may not be withdrawn except to the extent tendering shareholders are
entitled to withdrawal rights as described in this Section 4.
5. PURCHASE OF SHARES AND PAYMENT OF PURCHASE PRICE.
Upon the terms and subject to the conditions of the Offer, the Company will
determine the Purchase Price it will pay for validly tendered Shares taking into
account the number of Shares tendered and the prices specified by tendering
shareholders and will accept for payment (and thereby purchase) Shares validly
tendered at or below the Purchase Price as soon as practicable after the
Expiration Date. For purposes of the Offer, the Company will be deemed to have
accepted for payment (and therefore purchased), subject to proration, Shares
which are tendered at or below the Purchase Price and not withdrawn when, as and
if it gives oral or written notice to the Depositary of its acceptance of such
Shares for payment pursuant to the Offer.
Upon the terms and subject to the conditions of the Offer, the Company will
purchase and pay a single per Share Purchase Price for 1,858,650 Shares (subject
to increase or decrease as provided in Section 1 and Section 15) or such lesser
number of Shares as are validly tendered at prices not greater than $90 nor less
than $78 per Share, as promptly as practicable after the Expiration Date.
Payment for Shares purchased pursuant to the Offer will be made by
depositing the aggregate Purchase Price therefor with the Depositary, which will
act as agent for tendering shareholders for the purpose of receiving payment
from the Company and transmitting payment to the tendering shareholders. In the
event of proration, the Company will determine the proration factor and pay for
those tendered Shares accepted for payment as soon as practicable after the
Expiration Date; however, the Company does not expect to be able to announce the
final results of any such proration until approximately seven OTC trading days
after the Expiration Date. Certificates for all Shares not purchased, including
all Shares tendered at prices greater than the Purchase Price and Shares not
purchased due to proration, will be returned (or, in the case of Shares tendered
by book-entry transfer, such Shares will be credited to the account maintained
with one of the Book-Entry Transfer Facilities by the participant therein who so
delivered such Shares) as soon as practicable after the Expiration Date or
termination of the Offer without expense to the tendering shareholder. Under no
circumstances will the Company pay interest on the Purchase Price. In addition,
if certain events occur, the Company may not be obligated to purchase Shares
pursuant to the Offer. See Section 6.
The Company will pay all stock transfer taxes, if any, payable on the
transfer to it of Shares purchased pursuant to the Offer; provided, however,
that (i) if payment of the Purchase Price is to be made to, or (ii) (in the
circumstances permitted by the Offer) if unpurchased Shares are to be registered
in the name of, any person other than the registered owner, or if tendered
certificates are registered in the name of any person other than the person
signing the Letter of Transmittal, the amount of all stock transfer taxes, if
any (whether imposed on the registered owner or such other person), payable on
account of the transfer to such person will be deducted from the Purchase Price
unless evidence satisfactory to the Company of the payment of such taxes or
exemption therefrom is submitted. See Instruction 7 of the Letter of
Transmittal.
THE COMPANY MAY BE REQUIRED TO WITHHOLD AND REMIT TO THE INTERNAL REVENUE
SERVICE (THE "IRS"), 31% OF THE GROSS PROCEEDS PAID TO ANY TENDERING SHAREHOLDER
OR OTHER PAYEE WHO FAILS TO COMPLETE FULLY AND SIGN THE SUBSTITUTE FORM W-9
INCLUDED IN THE LETTER OF TRANSMITTAL. SEE SECTION 3.
6. CERTAIN CONDITIONS OF THE OFFER.
Notwithstanding any other provision of the Offer, the Company shall not be
required to accept for payment, purchase or pay for any Shares tendered, and may
terminate or amend the Offer or may postpone the acceptance for payment of, the
purchase of and the payment for, Shares tendered, subject to Rule 13e-4(f) under
the Exchange Act (see Section 15), if, in the sole judgment of the Company, at
any time on or after November 3, 1994, and at or before the time of purchase of
any such Shares, any of the following events shall have occurred (or shall have
been determined by the Company to have occurred) which,
10
<PAGE> 11
regardless of the circumstances (including any action or omission to act by the
Company), makes it inadvisable to proceed with the Offer or with such purchase
or payment:
(a) there shall have been threatened, instituted or pending any action
or proceeding by any government or governmental, regulatory or
administrative agency or authority or tribunal or any other person,
domestic or foreign, or before any court or governmental, regulatory or
administrative authority or agency or tribunal, domestic or foreign, which:
(1) challenges the making of the Offer, the acquisition of Shares pursuant
to the Offer or otherwise relates in any manner to the Offer or (2) in the
Company's sole judgment, could materially affect the business, condition
(financial or other), income, operations or prospects of the Company and
its subsidiaries, taken as a whole, or otherwise materially impair in any
way the contemplated future conduct of the business of the Company or any
of its subsidiaries or materially impair the Offer's contemplated benefits
to the Company; or
(b) there shall have been any action threatened or taken, or approval
withheld, or any statute, rule, regulation, judgment, order or injunction
threatened, proposed, sought, promulgated, enacted, entered, amended,
enforced or deemed to be applicable to the Offer or the Company or any of
its subsidiaries, by any court or any government or governmental,
regulatory or administrative authority or agency or tribunal, domestic or
foreign, which, in the Company's sole judgment, would or might directly or
indirectly: (1) make the acceptance for payment of, or payment for, some or
all of the Shares illegal or otherwise restrict or prohibit consummation of
the Offer, (2) delay or restrict the ability of the Company, or render the
Company unable, to accept for payment or pay for some or all of the Shares,
(3) materially impair the contemplated benefits of the Offer to the Company
or (4) materially affect the business, condition (financial or other),
income, operations or prospects of the Company and its subsidiaries, taken
as a whole, or otherwise materially impair in any way the contemplated
future conduct of the business of the Company or any of its subsidiaries;
or
(c) there shall have occurred: (1) the declaration of any banking
moratorium or suspension of payments in respect of banks in the United
States, (2) any general suspension of trading in, or limitation on prices
for, securities on any United States national securities exchange or in the
over-the-counter market, (3) the commencement or escalation of a war, armed
hostilities or any other national or international crisis directly or
indirectly involving the United States, (4) any limitation (whether or not
mandatory) by any governmental, regulatory or administrative agency or
authority on, or any event which, in the Company's sole judgment, might
affect, the extension of credit by banks or other lending institutions in
the United States, (5) any significant decrease in the market price of the
Shares or in the general level of market prices of equity securities in the
United States or abroad or any change in the general political, market,
economic or financial conditions in the United States or abroad that could
have a material adverse effect on the Company's business, operations or
prospects or the trading in the Shares or that, in the sole judgment of the
Company, makes it inadvisable to proceed with the Offer or (6) in the case
of any of the foregoing existing at the time of the commencement of the
Offer, in the Company's sole judgment, a material acceleration or worsening
thereof; or
(d) any change shall have occurred or be threatened in the business,
condition (financial or other), income, operations, Share ownership or
prospects of the Company and its subsidiaries, taken as a whole, which, in
the Company's sole judgment, is or may be material to the Company or any
other event shall have occurred which, in the Company's sole judgment,
materially impairs the Offer's contemplated benefits; or
(e) a tender or exchange offer for any or all of the Shares (other
than the Offer), or any merger, business combination or other similar
transaction with or involving the Company or any subsidiary, shall have
been proposed, announced or made by any person; or
(f) (i) any entity, "group" (as that term is used in Section 13(d)(3)
of the Exchange Act) or person shall have acquired or proposed to acquire
beneficial ownership of more than 5% of the outstanding Shares (other than
any such person, entity or group who have filed a Schedule 13D or Schedule
13G with the Securities and Exchange Commission (the "Commission") on or
before January 3, 1994), (ii) any such entity, group or person who have
filed a Schedule 13D or Schedule 13G
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<PAGE> 12
with the Commission on or before January 3, 1994 shall have acquired or
proposed to acquire beneficial ownership of an additional 2% or more of the
outstanding Shares or (iii) any person, entity or group shall have filed a
Notification and Report Form under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976 or made a public announcement reflecting an intent
to acquire the Company or any of its subsidiaries or any of their
respective assets or securities other than in connection with a transaction
authorized by the Board of Directors of the Company.
The foregoing conditions are for the Company's sole benefit and may be
asserted by the Company regardless of the circumstances giving rise to any such
condition (including any action or inaction by the Company) or may be waived by
the Company in whole or in part. The Company's failure at any time to exercise
any of the foregoing rights shall not be deemed a waiver of any such right and
each such right shall be deemed an ongoing right which may be asserted at any
time and from time to time. Any determination by the Company concerning the
events described in this Section 6 shall be final and shall be binding on all
parties.
7. PRICE RANGE OF SHARES; DIVIDENDS.
The Shares are traded in the OTC market and quoted on the NASDAQ/NMS under
the symbol "MNCO." The following table sets forth for the calendar periods
indicated the high and low closing per Share sales prices on the NASDAQ/NMS as
reported in published financial sources and the dividends paid per Share:
<TABLE>
<CAPTION>
HIGH LOW DIVIDENDS
---- ---- ---------
<S> <C> <C> <C>
1992:
4th Quarter......................................... $52 1/4 $ 44 $0.50
1993:
1st Quarter......................................... 64 1/4 50 0.50
2nd Quarter......................................... 61 5/8 52 0.50
3rd Quarter......................................... 59 7/8 54 1/4 0.50
4th Quarter......................................... 62 3/4 57 1/2 --(a)
1994:
1st Quarter......................................... 65 1/4 55 0.50(a)
2nd Quarter......................................... 79 59 5/8 0.50
3rd Quarter......................................... 79 1/4 72 1/4 0.50
4th Quarter (through November 2, 1994).............. 80 3/4 74 1/2 0.50(b)
</TABLE>
- -------------------------
(a) A fourth quarter 1993 dividend of $0.50 per Share was declared January 19,
1994, payable to holders of record on February 1, 1994. This reflected a
change in the timing of the Company's dividend declaration and not in the
Company's dividend policy.
(b) A fourth quarter 1994 dividend was declared on October 19, 1994, payable on
November 15, 1994, to holders of record on November 1, 1994.
On November 2, 1994, the last trading day prior to the announcement and
commencement of the Offer, the closing per Share sales price as reported on the
NASDAQ/NMS was $77 3/4. SHAREHOLDERS ARE URGED TO OBTAIN CURRENT MARKET
QUOTATIONS FOR THE SHARES.
8. INTEREST OF DIRECTORS AND EXECUTIVE OFFICERS; TRANSACTIONS AND
ARRANGEMENTS CONCERNING THE SHARES.
As of October 29, 1994, the Company's directors and executive officers as a
group beneficially owned (including pursuant to options) an aggregate of 520,832
Shares (approximately 3.3% of the outstanding Shares including Shares issuable
upon the exercise of options). Such ownership includes 246,916 Shares
(approximately 1.6% of the outstanding Shares including Shares issuable upon the
exercise of options) as of October 29, 1994 subject to stock options which are
held by executive officers. In addition, as of October 29, 1994, as set forth
under Section 3, the Company's ESOP and Deferred Compensation Plan owned
1,170,958
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<PAGE> 13
Shares and 1,080,625 Shares, respectively, representing approximately 7.4% and
6.8%, respectively of the outstanding Shares including Shares issuable upon the
exercise of options.
If the Company purchases 1,858,650 Shares (or approximately 12% of the
Shares outstanding at October 29, 1994) pursuant to the Offer and no executive
officer or director tenders Shares pursuant to the Offer, then after the
purchase of Shares pursuant to the Offer, the Company's executive officers and
directors as a group would beneficially own approximately 3.7% of the
outstanding Shares including Shares issuable upon the exercise of options, and,
assuming that none of the Shares held in the ESOP and the Deferred Compensation
Plan are tendered, such plans would own approximately 8.4% and 7.7% of the
outstanding Shares, respectively. Decisions as to whether Shares held in the
ESOP and Deferred Compensation Plan will be tendered will be made as described
in Section 3. The Company has been advised that no director or executive officer
of the Company intends to tender any Shares pursuant to the Offer.
Except as set forth on Schedule A, based upon the Company's records and
upon information provided to the Company by its directors, executive officers
and affiliates, neither the Company nor any of its subsidiaries nor, to the best
of the Company's knowledge, any of the directors or executive officers of the
Company, nor any associates of any of the foregoing, has effected any
transactions in the Shares or Contracts during the 40 business day period prior
to the date hereof.
Except as set forth in this Offer to Purchase, neither the Company nor, to
the best of the Company's knowledge, any of its affiliates, directors or
executive officers, or any of the executive officers or directors of its
subsidiaries, is a party to any contract, arrangement, understanding or
relationship with any other person relating, directly or indirectly, to the
Offer with respect to any securities of the Company (including, but not limited
to, any contract, arrangement, understanding or relationship concerning the
transfer or the voting of any such securities, joint ventures, loan or option
arrangements, puts or calls, guaranties of loans, guaranties against loss or the
giving or withholding of proxies, consents or authorizations).
9. SOURCE AND AMOUNT OF FUNDS.
Assuming that the Company purchases 1,858,650 Shares pursuant to the Offer
at a Purchase Price of $90 per Share and all of the outstanding Stock Purchase
Contracts in the Contract Offer at a purchase price of $90 per Share equivalent,
the Company expects the maximum aggregate cost, including all fees and expenses
applicable to the Offer, to be approximately $202 million.
The Company plans to obtain the funds needed for the Offer and the Contract
Offer from cash on hand of approximately $235 million.
See "Pro Forma Financial Information" for information concerning the
assumed cost of funds for the Offer.
10. CERTAIN INFORMATION ABOUT THE COMPANY; BACKGROUND AND PURPOSE OF THE OFFER.
THE COMPANY. Michigan National Corporation, a Michigan corporation, owns
100% of Michigan National Bank, a national banking association and the Company's
principal operating subsidiary, and 100% of Independence One Bank of California
("IOBOC"), a federal savings bank. As of September 30, 1994, the Company had
total assets of $9.2 billion, total deposits of $7.5 billion, and shareholders'
equity of $998 million. As of September 30, 1994, MNB constituted approximately
90% of the consolidated assets of the Company.
As a bank holding company registered under the Bank Holding Company Act of
1956, as amended, the Company is subject to supervision and regulation by the
Board of Governors of the Federal Reserve System (the "Federal Reserve Board").
As a savings and loan holding company, the Company is also subject to
examination by the Office of Thrift Supervision.
The Company's principal executive offices are located at 27777 Inkster
Road, Farmington Hills, MI 48334, and the Company's telephone number is (810)
473-3000.
13
<PAGE> 14
THE RESTRUCTURING. The Offer is a part of a comprehensive restructuring
developed by the Company to enhance shareholder value. The restructuring
consists of three major components: first, to focus the Company's resources on
its Michigan-based, core banking business; second, to streamline and enhance the
efficiency and profitability of that core business; and third, to reposition the
Company's balance sheet to increase return on equity by redeploying that portion
of the Company's equity capital that is not necessary for the Company's
Michigan-based, core banking business.
Over the past several months, the Company has with the assistance of its
financial advisors undertaken a comprehensive analysis of the Company's
strategic strengths and weaknesses, with a view to the disposition by the
Company of those businesses not meeting the Company's requirements for
profitability and long-term strategic value. Based on this analysis, the Company
decided to focus on its Michigan-based, core banking business. While this aspect
of the restructuring is still in the process of being implemented, the Company
has already consummated several significant dispositions described below under
the subtitle "Recent and Planned Dispositions."
On October 20, 1994, the Company announced the implementation phase of
"Project Streamline," a comprehensive program to re-engineer the internal
operating processes of the Company and its Michigan-based core banking business.
Once fully implemented, Project Streamline is expected to result in a $85
million improvement in the Company's pre-tax income from a reduction in
operating expenses and increases in non-interest income. Developed and overseen
by management of the Company with the assistance of Tandon Capital Associates,
Inc., a New York-based advisory firm, the program is also expected to improve
the Company's efficiency ratio to less than 55% by the end of the fourth quarter
of 1995. The Company expects to record up-front charges of approximately $62
million in the fourth quarter of 1994 to reflect severance and other costs
associated with Project Streamline.
As of September 30, 1994, the Company had accumulated equity capital of
approximately $998 million, representing 10.83% of its total assets. Together
with the Contract Offer described below (see Section 11), the Offer is designed
to reposition the Company's balance sheet to increase return on equity by
redeploying that portion of the Company's equity capital that is not necessary
for the Company's Michigan-based, core banking business. Following completion of
the Offer and the Contract Offer, the Company and MNB will continue to have
strong capital positions and will continue to qualify as "well capitalized"
institutions under the prompt corrective action scheme enacted by the Federal
Deposit Insurance Corporation Improvements Act of 1991. On a pro forma basis as
of September 30, 1994, giving effect to the Offer and the Contract Offer at the
maximum Purchase Prices of $90 per Share (or in the case of the Contract Offer,
$90 per Share equivalent), and assuming acceptance of the maximum number of
Shares in the Offer and Stock Purchase Contracts in the Contract Offer, the
Company would have had an equity to asset ratio of 8.6%, a Total risk-based
capital ratio of 10.39% and a leverage ratio of 6.98%.
RECENT AND PLANNED DISPOSITIONS. In the third quarter of 1994, the Company
has closed or entered into agreements for the disposition of three subsidiary
businesses. Together, these dispositions and related actions have to date
resulted in one-time aggregate after-tax net gains of approximately $91.0
million.
On August 4, 1994, the Company completed the sale of Lockwood Banc Group,
Inc., a bank holding company with operations in Houston, Texas. On August 31,
1994, the Company completed the sale of First State Bank and Trust, a bank with
operations in Port Lavaca and Bay City, Texas. As a result of these two sales,
the Company had a $13 million after-tax gain and core capital increase.
On August 11, 1994, the Company's mortgage banking subsidiary, Independence
One Mortgage Corporation, agreed to sell its $8.6 billion mortgage servicing
rights portfolio, its mortgage servicing operation and its non-Michigan loan
origination business. This sale, which was fully completed on October 18, 1994,
resulted in a $27 million after-tax gain and core capital increase.
On October 4, 1994, the Company announced that it plans to sell
substantially all of the assets and liabilities of IOBOC and its subsidiaries.
IOBOC has assets of approximately $500 million and operates five branches in
southern California.
14
<PAGE> 15
The Company also announced a negotiated prepayment by the Federal Deposit
Insurance Corporation of a ten-year note received by the Company and the
termination of an assistance agreement entered into in connection with the
acquisition of IOBOC by the Company. As a result of this prepayment and
termination of the assistance agreement, the Company recognized a one-time $51
million after-tax gain and capital increase in the third quarter of 1994.
In the second quarter of 1994, tax benefits of $42.8 million associated
with the acquisition of IOBOC were recognized, $40.2 million of which were
reflected in earnings and $2.6 million of which were added directly to the
Company's shareholders' equity.
THE OFFER. As described above, the Offer is part of a comprehensive
restructuring intended to enhance shareholder value. The Offer will enable
shareholders to sell a portion of their Shares while retaining a continuing
equity interest in the Company if they so desire. The Offer and the Contract
Offer will increase the Company's leverage, with an attendant increase in the
risks and rewards for persons who retain a continuing equity interest in the
Company. In addition, persons who determine not to accept the Offer or the
Contract Offer will realize a proportionate increase in their relative equity
interest in the Company, and thus in the Company's future earnings and assets,
subject to increased risks resulting from higher leverage and to the Company's
ability to issue additional Shares or other equity securities in the future.
The Offer may provide shareholders who are considering a sale of all or a
portion of their Shares the opportunity to determine the price or prices (not
greater than $90 nor less than $78 per Share) at which they are willing to sell
their Shares and, if any such Shares are purchased pursuant to the Offer, to
sell those Shares for cash without the usual transaction costs associated with
open-market sales. Any shareholders owning an aggregate of less than 100 Shares
whose Shares are purchased pursuant to the Offer not only will avoid any payment
of brokerage commissions, but also will avoid any applicable odd lot discounts
payable on sales of odd lots effected on a securities exchange. The Offer also
gives shareholders the opportunity to sell Shares at prices greater than market
prices prevailing prior to announcement of the Offer. To the extent the purchase
of Shares in the Offer results in a reduction in the number of shareholders of
record, the costs of the Company for services to shareholders may be reduced.
THE BOARD OF DIRECTORS HAS UNANIMOUSLY APPROVED THE OFFER. HOWEVER, NEITHER
THE COMPANY NOR ITS BOARD OF DIRECTORS MAKES ANY RECOMMENDATION TO ANY
SHAREHOLDER AS TO WHETHER TO TENDER OR REFRAIN FROM TENDERING ANY OR ALL OF SUCH
SHAREHOLDER'S SHARES AND HAS NOT AUTHORIZED ANY PERSON TO MAKE ANY SUCH
RECOMMENDATION. SHAREHOLDERS ARE URGED TO EVALUATE CAREFULLY ALL INFORMATION IN
THE OFFER, CONSULT THEIR OWN INVESTMENT AND TAX ADVISORS AND MAKE THEIR OWN
DECISIONS WHETHER TO TENDER SHARES AND, IF SO, HOW MANY SHARES TO TENDER AND THE
PRICE OR PRICES AT WHICH SHARES SHOULD BE TENDERED.
Following completion of the Offer, the Company may repurchase additional
Shares in the open market, in privately negotiated transactions or otherwise.
Any such purchases may be on the same terms or on terms which are more or less
favorable to shareholders than the terms of the Offer or the Contract Offer.
Rule 13e-4 under the Exchange Act prohibits the Company and its affiliates from
purchasing any Shares, other than pursuant to the Offer or the Contract Offer,
until at least ten business days after the Expiration Date. Any possible future
purchases by the Company will depend on many factors, including the market price
of the Shares, the results of the Offer and the Contract Offer, the Company's
business and financial position and general economic and market conditions.
Shares the Company acquires pursuant to the Offer will be held in the
Company's treasury and will be available for the Company to issue without
further shareholder action (except as required by applicable law or the rules of
the securities exchanges on which the Shares are listed). Such Shares could be
issued without shareholder approval for such purposes as, among others, the
acquisition of other businesses, the raising of additional capital for use in
the Company's business.
15
<PAGE> 16
MICHIGAN NATIONAL CORPORATION
SUMMARY CONSOLIDATED HISTORICAL FINANCIAL INFORMATION
Set forth below is certain summary historical consolidated financial
information of the Company. The summary financial information is derived from
the audited consolidated financial statements as reported in the Company's
Annual Report and Form 10-K for the years ended December 31, 1993 and December
31, 1992 and the unaudited consolidated financial statements as reported in the
Company's Quarterly Report on Form 10-Q for the period ended September 30, 1994.
More comprehensive financial information is included in such reports, and the
financial information that follows is qualified by reference to such documents
and all of the financial statements and related notes contained therein.
<TABLE>
<CAPTION>
AT OR FOR
AT OR FOR THE YEAR ENDED
THE NINE MONTHS ENDED ----------------------------
------------------------------ DECEMBER 31, DECEMBER 31,
SEPTEMBER 30, SEPTEMBER 30, 1993 1992
1994 1993 ------------ ------------
------------- -------------
(UNAUDITED) (UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AND RATIO AMOUNTS)
<S> <C> <C> <C> <C>
SUMMARY INCOME DATA:
Interest income............................. $ 485,680 $ 524,786 $ 694,236 $ 779,073
Interest expense............................ 189,740 225,006 292,625 377,962
Net interest income......................... 295,940 299,780 401,611 401,111
Provision for credit losses................. 18,000 33,000 40,000 70,670
Net interest income after provision for
credit losses............................. 277,940 266,780 361,611 330,441
Noninterest income.......................... 215,103 173,067 240,830 224,793
Noninterest expense......................... 341,034 450,222 580,685 488,776
Income (loss) from continuing operations
before income taxes and cumulative effect
of accounting change...................... 152,009 (10,375) 21,756 66,458
Provision (credit) for income taxes......... (39,617) (1,506) (2,007) 6,625
------------- ------------- ------------ ------------
Income, before cumulative effect of a change
in accounting principle................... 191,626 (8,869) 23,763 59,806
Cumulative effect of a change in accounting
principle(2).............................. 0 0 0 6,265
------------- ------------- ------------ ------------
Net income (loss)........................... $ 191,626 $ (8,869) $ 23,763 $ 66,071
========== ========== ========== ==========
SUMMARY BALANCE SHEET DATA:
Total assets................................ $ 9,207,306 $ 10,395,410 $ 10,172,808 $ 10,663,324
Loans (net of unearned income and allowance
for possible credit losses)............... 5,990,673 6,507,527 6,480,274 6,555,577
Deposits.................................... 7,512,949 8,656,246 8,725,079 8,975,293
Long-term debt.............................. 70,779 77,998 77,122 82,651
Shareholders' equity........................ 997,541 781,397 815,590 805,775
PER SHARE DATA:
Net income(1)............................... $ 12.22 $ (0.59) $ 1.56 $ 4.38
Book value.................................. 65.14 51.66 53.74 53.65
Weighted average number of common shares
outstanding (thousands)................... 15,681 15,057 15,230 15,079
SELECTED RATIOS:
Ratio of earnings to fixed charges(3):
Excluding interest on deposits......... 8.5x 0.5x 1.9x 2.9x
Including interest on deposits......... 1.8x 1.0x 1.1x 1.2x
Equity to asset ratio....................... 10.83% 7.50% 8.02% 7.56%
Leverage ratio.............................. 9.13% 7.09% 7.56% 7.24%
Total risk-based capital ratio.............. 13.12% 11.16% 11.73% 11.91%
</TABLE>
- -------------------------
(1) Net income per share reflects the use of the "treasury stock" method to
calculate the common stock equivalents attributable to the Company's 8%
Redeemable Subordinated Debentures (the "Debentures"), which were issued in
conjunction with the Stock Purchase Contracts. Increasing rates during 1994
have resulted in a significant narrowing of the premium value of the fixed
income feature of the Debentures and it appears likely that the fixed income
feature could be valued at a discount in the near future. If and when that
occurs, the "if converted" method will be used to calculate the common stock
equivalents of the Debentures and the associated Stock Purchase Contracts.
The "if converted" method would result in an approximately 800,000 share
increase in common stock equivalents. In addition, interest expense on the
Debentures would be added back to income for purposes of calculating net
income per share under the "if converted" method.
(2) Effective January 1, 1992, the Company adopted Statement of Financial
Accounting Standards (SFAS) No. 109, "Accounting for Income Taxes", which
superceded SFAS No. 96.
(3) The ratio of earnings to fixed charges is computed by dividing (i) net
income less nonrecurring income plus income taxes plus fixed charges by (ii)
fixed charges. Fixed charges consist of appropriate interest expense and
one-third of rent expense.
16
<PAGE> 17
MICHIGAN NATIONAL CORPORATION
SUMMARY UNAUDITED PRO FORMA FINANCIAL INFORMATION
The following unaudited Pro Forma financial information reflects
transactions regarding the restructuring program described above, including
consummation of the Offer on the basis of Purchase Prices of $78 and $90 per
Share, consummation of the Contract Offer on the basis of a per Share equivalent
repurchase price of $78 and $90, assuming in each case acceptance of the maximum
number of Shares in the Offer and Stock Purchase Contracts in the Contract
Offer. The unaudited Pro Forma Statement of Income data give effect to such
transactions as if they had occurred at the beginning of the periods presented.
The unaudited Pro Forma balance sheet data give effect to the transactions as if
they had occurred on the respective dates indicated. The Pro Forma information
should be read in conjunction with the summary historical financial information
and does not purport to be indicative of the results which may be obtained in
the future or which would actually have been obtained had the Offer and the
Contract Offer occurred as of the dates indicated.
<TABLE>
<CAPTION>
AT OR FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1994
----------------------------------------------------------------------------
CONTRACT
OFFER AT
$78 PER OFFER AT
UNAUDITED SHARE PRO $78 PER PRO
HISTORICAL EQUIVALENT(3) FORMA SHARE(5) FORMA
---------- ------------- ---------- --------- ----------
(IN THOUSANDS, EXCEPT PER SHARE AND RATIO AMOUNTS)
<S> <C> <C> <C> <C> <C>
CONSOLIDATED STATEMENT OF INCOME DATA:
Interest income.................................. $ 485,680 $ 0 $ 485,680 $ 0 $ 485,680
Interest expense................................. (189,740) (712)(4) (190,452) (4,902)(4) (195,354)
---------- ------ ---------- --------- ----------
Net interest income............................ 295,940 (712) 295,228 (4,902) 290,326
Provision for credit losses...................... 18,000 0 18,000 0 18,000
---------- ------ ---------- --------- ----------
Net interest income after provision for credit
losses....................................... 277,940 (712) 277,228 (4,902) 272,326
Noninterest income............................... 215,103 0 215,103 0 215,103
Noninterest expense.............................. 341,034 0 341,034 0 341,034
Provision (credit) for income taxes.............. (39,617) (249) (39,866) (1,716) (41,582)
---------- ------ ---------- --------- ----------
Net income (loss)................................ $ 191,626 $(463) $ 191,163 $ (3,186) $ 187,977
========= =========== ========= ========= =========
PER SHARE DATA:
Net income per share............................. $12.22(2) $12.39 $13.85
Book value per share............................. $65.14 $65.10 $61.52
CONSOLIDATED BALANCE SHEET DATA:
Total assets..................................... $9,207,306 $9,207,306 $9,207,306
Loans (net of unearned income and allowance for
possible credit losses)........................ 5,990,673 5,990,673 5,990,673
Deposits......................................... 7,512,949 7,512,949 7,512,949
Long-term debt................................... 70,779 70,779 70,779
Shareholders' equity............................. 997,541 $(463) 997,078 $(169,205) 827,873
SELECTED RATIOS:
Ratio of earnings to fixed charges:(1)
Excluding interest on deposits................. 8.5x 8.2x 6.7x
Including interest on deposits................. 1.8x 1.8x 1.7x
Equity to asset ratio............................ 10.83% 10.83% 8.99%
Leverage ratio................................... 9.13% 9.13% 7.35%
Total risk based capital ratio................... 13.12% 12.98% 10.85%
</TABLE>
- -------------------------
(1) The ratio of earnings to fixed charges is computed by dividing (i) net
income less nonrecurring income plus income taxes plus fixed charges by (ii)
fixed charges. Fixed charges consist of appropriate interest expense and
one-third of rent expense.
(2) For the historical data only, net income per share reflects the use of the
"treasury stock" method to calculate the common stock equivalents
attributable to the Company's 8% Redeemable Subordinated Debentures (the
"Debentures"), which were issued in conjunction with the Stock Purchase
Contracts. Increasing rates during 1994 have resulted in a significant
narrowing of the premium value of the fixed income feature of the Debentures
and it appears likely that the fixed income feature could be valued at a
discount in the near future. If and when that occurs, the "if converted"
method will be used to calculate the common stock equivalents of the
Debentures and the associated Stock Purchase Contracts. The "if converted"
method would result in an approximately 800,000 share increase in common
stock equivalents. In addition, interest expense on the Debentures would be
added back to income for purposes of calculating net income per share under
the "if converted" method. To the extent Stock Purchase Contracts are
acquired in the Contract Offer, the foregoing will not apply.
(3) See Section 11. Assumes acceptance of 100% of the Stock Purchase Contracts
sought in the Contract Offer.
(4) The adjustment reflects replacing the Stock Purchase Contracts and Shares
assumed to be acquired in the Contract Offer and the Offer, respectively,
with a liability with an assumed cost equal to the average Fed Funds rate
for the period.
(5) Assumes acceptance of 100% of the Shares sought in the Offer.
17
<PAGE> 18
MICHIGAN NATIONAL CORPORATION
SUMMARY UNAUDITED PRO FORMA FINANCIAL INFORMATION
<TABLE>
<CAPTION>
AT OR FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1994
--------------------------------------------------------------------------
CONTRACT OFFER
AT $90 PER OFFER AT
UNAUDITED SHARE PRO $90 PER PRO
HISTORICAL EQUIVALENT(3) FORMA SHARE(5) FORMA
---------- -------------- ---------- ----------- ----------
(IN THOUSANDS, EXCEPT PER SHARE AND RATIO AMOUNTS)
<S> <C> <C> <C> <C> <C>
CONSOLIDATED STATEMENTS OF INCOME DATA:
Interest income.................................... $ 485,680 $ 0 $ 485,680 $ 0 $ 485,680
Interest expense................................... (189,740) (1,152)(4) (190,892) (5,656)(4) (196,549)
---------- ------- ---------- ----------- ----------
Net interest income.............................. 295,940 (1,152) 294,788 (5,656) 289,131
Provision for credit losses........................ 18,000 0 18,000 0 18,000
---------- ------- ---------- ----------- ----------
Net interest income after provision for credit
losses......................................... 277,940 (1,152) 276,788 (5,656) 271,131
Noninterest income................................. 215,103 0 215,103 0 215,103
Noninterest expense................................ 341,034 0 341,034 0 341,034
Provision (credit) for income taxes................ (39,617) (403) (40,020) (1,980) (42,000)
---------- ------- ---------- ----------- ----------
Net income (loss).................................. $ 191,626 $ (749) $ 190,877 $ (3,677) $ 187,200
========= =========== ========= ========= =========
PER SHARE DATA:
Net income per share............................... $12.22(2) $12.37 $13.75
Book value per share............................... $65.14 $65.09 $58.84
CONSOLIDATED BALANCE SHEET DATA:
Total assets....................................... $9,207,306 $9,207,306 $9,207,306
Loans (net of unearned income and allowance for
possible credit losses).......................... 5,990,673 5,990,673 5,990,673
Deposits........................................... 7,512,949 7,512,949 7,512,949
Long-term debt..................................... 70,779 70,779 70,779
Shareholders' equity............................... 997,541 $ (749) 996,792 $(205,027) 791,765
SELECTED RATIOS:
Ratio of earnings to fixed charges:(1)
Excluding interest on deposits................... 8.5x 8.1x 6.5x
Including interest on deposits................... 1.8x 1.8x 1.7x
Equity to asset ratio.............................. 10.83% 10.83% 8.60%
Leverage ratio..................................... 9.13% 9.12% 6.98%
Total risk based capital ratio..................... 13.12% 12.98% 10.39%
</TABLE>
- -------------------------
(1) The ratio of earnings to fixed charges is computed by dividing (i) net
income less nonrecurring income plus income taxes plus fixed charges by (ii)
fixed charges. Fixed charges consist of appropriate interest expense and
one-third of rent expense.
(2) For the historical data only, net income per share reflects the use of the
"treasury stock" method to calculate the common stock equivalents
attributable to the Company's 8% Redeemable Subordinated Debentures (the
"Debentures"), which were issued in conjunction with the Stock Purchase
Contracts. Increasing rates during 1994 have resulted in a significant
narrowing of the premium value of the fixed income feature of the Debentures
and it appears likely that the fixed income feature could be valued at a
discount in the near future. If and when that occurs, the "if converted"
method will be used to calculate the common stock equivalents of the
Debentures and the associated Stock Purchase Contracts. The "if converted"
method would result in an approximate 800,000 share increase in common stock
equivalents. In addition, interest expense on the Debentures would be added
back to income for purposes of calculating net income per share under the
"if converted" method. To the extent Stock Purchase Contracts are acquired
in the Contract Offer, the foregoing will not apply.
(3) See Section 11. Assumes acceptance of 100% of the Stock Purchase Contracts
sought in the Contract Offer.
(4) The adjustment reflects replacing the Stock Purchase Contracts and Shares
assumed to be acquired in the Contract Offer and the Offer, respectively,
with a liability with an assumed cost equal to the average Fed Funds rate
for the period.
(5) Assumes acceptance of 100% of the Shares sought in the Offer.
18
<PAGE> 19
MICHIGAN NATIONAL CORPORATION
SUMMARY UNAUDITED PRO FORMA FINANCIAL INFORMATION
<TABLE>
<CAPTION>
AT OR FOR THE YEAR ENDED DECEMBER 31, 1993
-------------------------------------------------------------------
CONTRACT
OFFER AT OFFER AT
$78 PER SHARE PRO $78 PER PRO
HISTORICAL EQUIVALENT(3) FORMA SHARE(5) FORMA
----------- ------------- ----------- --------- -----------
(IN THOUSANDS, EXCEPT PER SHARE AND RATIO AMOUNTS)
<S> <C> <C> <C> <C> <C>
CONSOLIDATED STATEMENT OF INCOME DATA:
Interest income............................................ $694,236 $ 0 $694,236 $0 $694,236
Interest expense........................................... (292,625) (636)(4) (293,261) (4,378)(4) (297,639)
----------- ------ ----------- --------- -----------
Net interest income...................................... 401,611 (636) 400,975 (4,378) 396,597
Provision for credit losses................................ 40,000 0 40,000 0 40,000
----------- ------ ----------- --------- -----------
Net interest income after provision for credit losses.... 361,611 (636) 360,975 (4,378) 356,597
Noninterest income......................................... 240,830 0 240,830 0 240,830
Noninterest expense........................................ 580,685 0 580,685 0 580,685
Provision (credit) for income taxes........................ (2,007) (222) (2,229) (1,532) (3,762)
----------- ------ ----------- --------- -----------
Net income (loss).......................................... $23,763 $(413) $23,350 $(2,846) $20,504
========== =========== ========== ========= ==========
PER SHARE DATA:
Net income per share....................................... $1.56(2) $1.54 $1.52
Book value per share....................................... $53.74 $53.71 $48.53
CONSOLIDATED BALANCE SHEET DATA:
Total assets............................................... $10,172,808 $10,172,808 $10,172,808
Loans (net of unearned income and allowance for possible
credit losses)........................................... 6,480,274 6,480,274 6,480,274
Deposits................................................... 8,725,079 8,725,079 8,725,079
Long-term debt............................................. 77,122 77,122 77,122
Shareholders' equity....................................... 815,590 $(413) 815,177 $(168,864) 646,313
SELECTED RATIOS:
Ratio of earnings to fixed charges(1):
Excluding interest on deposits........................... 1.9x 1.8x 1.6x
Including interest on deposits........................... 1.1x 1.1x 1.1x
Equity to asset ratio...................................... 8.02% 8.01% 6.35%
Leverage ratio............................................. 7.56% 7.56% 5.96%
Total risk based capital ratio............................. 11.73% 11.59% 9.52%
</TABLE>
- -------------------------
(1) The ratio of earnings to fixed charges is computed by dividing (i) net
income less nonrecurring income plus income taxes plus fixed charges by (ii)
fixed charges. Fixed charges consist of appropriate interest expense and
one-third of rent expense.
(2) For the historical data only, net income per share reflects the use of the
"treasury stock" method to calculate the common stock equivalents
attributable to the Company's 8% Redeemable Subordinated Debentures (the
"Debentures"), which were issued in conjunction with the Stock Purchase
Contracts. Increasing rates during 1994 have resulted in a significant
narrowing of the premium value of the fixed income feature of the Debentures
and it appears likely that the fixed income feature could be valued at a
discount in the near future. If and when that occurs, the "if converted"
method will be used to calculate the common stock equivalents of the
Debentures and the associated Stock Purchase Contracts. In addition,
interest expense on the Debentures would be added back to income for
purposes of calculating net income per share under the "if converted"
method. To the extent Stock Purchase Contracts are acquired in the Contract
Offer, the foregoing will not apply.
(3) See Section 11. Assumes acceptance of 100% of the Stock Purchase Contracts
sought in the Contract Offer.
(4) The adjustment reflects replacing the Stock Purchase Contracts and Shares
assumed to be acquired in the Contract Offer and the Offer, respectively,
with a liability with an assumed cost equal to the average Fed Funds rate
for the period.
(5) Assumes acceptance of 100% of the Shares sought in the Offer.
19
<PAGE> 20
MICHIGAN NATIONAL CORPORATION
SUMMARY UNAUDITED PRO FORMA FINANCIAL INFORMATION
<TABLE>
<CAPTION>
AT OR FOR THE YEAR ENDED DECEMBER 31, 1993
----------------------------------------------------------------------------
CONTRACT
OFFER AT
$90 PER OFFER AT
SHARE PRO $90 PER PRO
HISTORICAL EQUIVALENT(3) FORMA SHARE(5) FORMA
------------ ------------- ----------- --------- -----------
(IN THOUSANDS, EXCEPT PER SHARE AND RATIO AMOUNTS)
<S> <C> <C> <C> <C> <C>
CONSOLIDATED STATEMENT OF INCOME DATA:
Interest income.................................. $ 694,236 $ 0 $ 694,236 $ 0 $ 694,236
Interest expense................................. (292,625 ) (1,029)(4) (293,654) (5,052)(4) (298,706)
------------ ------------- ----------- --------- -----------
Net interest income............................ 401,611 (1,029) 400,582 (5,052) 395,530
Provision for credit losses...................... 40,000 0 40,000 0 40,000
------------ ------------- ----------- --------- -----------
Net interest income after provision for credit
losses....................................... 361,611 (1,029) 360,582 (5,052) 355,530
Noninterest income............................... 240,830 0 240,830 0 240,830
Noninterest expense.............................. 580,685 0 580,685 0 580,685
Provision (credit) for income taxes.............. (2,007 ) (360) (2,367) (1,768) (4,135)
------------ ------------- ----------- --------- -----------
Net income (loss)................................ $ 23,763 $ (669) $ 23,094 $ (3,284) $ 19,810
========== =========== ========== ========= ==========
PER SHARE DATA:
Net income per share............................. $1.56 (2) $1.52 $1.46
Book value per share............................. $53.74 $53.69 $45.82
CONSOLIDATED BALANCE SHEET DATA:
Total assets..................................... $10,172,808 $10,172,808 $10,172,808
Loans (net of unearned income and allowance for
possible credit losses)........................ 6,480,274 6,480,274 6,480,274
Deposit.......................................... 8,725,079 8,725,079 8,725,079
Long-term debt................................... 77,122 77,122 77,122
Shareholders' equity............................. 815,590 (669) 814,921 (204,634) 610,287
SELECTED RATIOS:
Ratio of earnings to fixed charges:(1)
Excluding interest on deposit.................. 1.9 x 1.8x 1.6x
Including interest on deposits................. 1.1 x 1.1x 1.1x
Equity to asset ratio............................ 8.02 % 8.01% 6.00%
Leverage ratio................................... 7.56 % 7.55% 5.62%
Total risk based capital ratio................... 11.73 % 11.59% 9.08%
</TABLE>
- -------------------------
(1) The ratio of earnings to fixed charges is computed by dividing (i) net
income less nonrecurring income plus income taxes plus fixed charges by (ii)
fixed charges. Fixed charges consist of appropriate interest expense and
one-third of rent expense.
(2) For the historical data only, net income per share reflects the use of the
"treasury stock" method to calculate the common stock equivalents
attributable to the Company's 8% Redeemable Subordinated Debentures (the
"Debentures"), which were issued in conjunction with the Stock Purchase
Contracts. Increasing rates during 1994 have resulted in a significant
narrowing of the premium value of the fixed income feature of the Debentures
and it appears likely that the fixed income feature could be valued at a
discount in the near future. If and when that occurs, the "if converted"
method will be used to calculate the common stock equivalents of the
Debentures and the associated Stock Purchase Contracts. In addition,
interest expense on the Debentures would be added back to income for
purposes of calculating net income per share under the "if converted"
method. To the extent Stock Purchase Contracts are acquired in the Contract
Offer, the foregoing will not apply.
(3) See Section 11. Assumes acceptance of 100% of the Stock Purchase Contracts
sought in the Contract Offer.
(4) The adjustment reflects replacing the Stock Purchase Contracts and Shares
assumed to be acquired in the Contract Offer and the Offer, respectively,
with a liability with an assumed cost equal to the average Fed Funds rate
for the period.
(5) Assumes acceptance of 100% of the Shares sought in the Offer.
20
<PAGE> 21
ADDITIONAL INFORMATION. The Company is subject to the informational
requirements of the Exchange Act and in accordance therewith files periodic
reports, proxy statements and other information with the Commission relating to
its business, financial condition and other matters. The Company is required to
disclose in such proxy statements and reports certain information, as of
particular dates, concerning the Company's directors and officers, their
remuneration, stock options granted to them, the principal owners of the
Company's securities and any material interest of such persons in transactions
with the Company. The Company has also filed an Issuer Tender Offer Statement on
Schedule 13E-4 (the "Schedule 13E-4") with the Commission, which includes
certain additional information relating to the Offer.
Such material may be inspected at the public reference facilities
maintained by the Commission at Room 1024, 450 Fifth Street, N.W., Washington,
D.C. 20549, and also should be available for inspection and copying at the
following regional offices of the Commission: Seven World Trade Center, New
York, New York 10048 and Northwestern Atrium Center, 500 West Madison, Suite
1400, Chicago, Illinois 60661. Copies may also be obtained by mail for
prescribed rates from the Commission's Public Reference Room, 450 Fifth Street,
N.W., Washington, D.C. 20549. The Schedule 13E-4 will not be available at the
Commission's regional offices.
11. THE CONTRACT OFFER.
A separate offer (the "Contract Offer") to purchase for cash any or all of
the Stock Purchase Contracts at a purchase price of $21.625 per Stock Purchase
Contract is being made simultaneously with the Offer. In the event the Purchase
Price pursuant to the Offer is greater than $78.00, the Company will (x) amend
the Contract Offer to increase the purchase price thereunder to equal the
Purchase Price pursuant to the Offer less $56.375, which is the exercise price
of the Stock Purchase Contracts, and (y) extend the period of the Contract Offer
(but not the Offer) for an additional ten business days. Holders of Stock
Purchase Contracts may (i) participate in the Contract Offer by tendering their
Stock Purchase Contracts in accordance with the terms of the Contract Offer,
(ii) participate in the Offer by exercising their Stock Purchase Contracts in
accordance with their terms and tendering in the Offer the Shares issuable upon
such exercise, or (iii) do nothing and retain their Stock Purchase Contracts.
Pursuant to the terms of the Stock Purchase Contracts and the Equity
Contract Agency Agreement (the "Contract Agency Agreement") that governs the
Stock Purchase Contracts, commencement of the Offer may require the Company to
adjust the Exercise Price under the Stock Purchase Contracts. Currently the
exercise price (the "Exercise Price") under the Stock Purchase Contracts is
$56.375. Depending upon the purchase price in the Share Offer, the Exercise
Price will be adjusted to equal between approximately $55.372 (in the event the
purchase price in the Offer is $86.25) and $54.987 (in the event the purchase
price in the Share Offer is $90.00), in each case assuming that the Company
receives valid tenders for and accepts 100% of the Shares sought in the Offer.
In addition, upon such adjustment, each Contract will represent the obligation
and the right to purchase, at the adjusted Exercise Price, the number of Shares
obtained by (i) multiplying the number of Shares purchasable thereunder prior to
such adjustment by $56.375 and (ii) dividing that product by the Exercise Price
as so adjusted, rounding to the nearest one-hundredth of a Share. For example,
if a Stock Purchase Contract were currently exercisable for one Share, following
such adjustment, the Stock Purchase Contract would be exercisable for between
1.02 Shares (in the event the purchase price in the Offer is $86.25) and 1.03
Shares (in the event the purchase price in the Offer is $90.00). If the Exercise
Price is adjusted, the Company will increase the purchase price for the Stock
Purchase Contracts under the Contract Offer by the amount of the adjustment.
The Stock Purchase Contracts were initially issued together with 8%
Debentures as units. The Equity Contract Agency Agreement and the Indenture
governing the Stock Purchase Contracts and 8% Debentures prohibit the transfer
of these securities other than as units. IN ORDER FOR STOCK PURCHASE CONTRACTS
TO BE CORRECTLY AND VALIDLY TENDERED PURSUANT TO THIS OFFER, CONTRACT HOLDERS
MUST SURRENDER CORRESPONDING 8% DEBENTURES SIMULTANEOUSLY WITH THE TENDER OF
STOCK PURCHASE CONTRACTS AND SUBMISSION OF THE LETTER OF TRANSMITTAL AND OTHER
REQUIRED DOCUMENTS. As soon as practicable after acceptance of Stock Purchase
Contracts pursuant to the Offer, 8% Debentures so surrendered will be
21
<PAGE> 22
exchanged for 8% Debentures of equal principal amount and redelivered to the
holder. Thereafter, the transfer of such redelivered 8% Debentures will not be
restricted by the terms of the Indenture.
Following consummation of the Offer, the Company will notify each holder of
outstanding Stock Purchase Contracts at that time of the adjustments to the
Exercise Price and number of Shares for which Stock Purchase Contracts are
exercisable. Delivery of the Contract Offer constitutes notice of the
commencement of the Offer pursuant to the Contract Agency Agreement.
The foregoing information is qualified in its entirety by reference to the
Stock Purchase Contracts and the Contract Agency Agreement, forms of which are
exhibits to the Company's Registration Statement No. 33-24751.
Neither the Company nor its Board of Directors make any recommendation to
any holder of Stock Purchase Contracts as to whether to exercise the Stock
Purchase Contracts or as to whether to tender or refrain from tendering pursuant
to the Offer or the Contract Offer. To the extent holders of Stock Purchase
Contracts receive Shares upon exercise thereof such exercises will be
irrevocable. If any such Shares are not purchased pursuant to the Offer, holders
of such Shares will no longer be owner of the related Stock Purchase Contracts
entitled to the rights and subject to the obligations thereunder.
12. EFFECTS OF THE OFFER ON THE MARKET FOR SHARES; REGISTRATION UNDER THE
EXCHANGE ACT.
The Company's purchase of Shares pursuant to the Offer will reduce the
number of Shares that might otherwise trade publicly and is likely to reduce the
number of shareholders. Nonetheless, the Company anticipates that there will
still be a sufficient number of Shares outstanding and publicly traded following
the Offer to ensure a continued trading market in the Shares.
The Shares are currently "margin securities" under the rules of the Federal
Reserve Board. This has the effect, among other things, of allowing brokers to
extend credit on the collateral of the Shares. The Company believes that,
following the repurchase of Shares pursuant to the Offer, the Shares will
continue to be "margin securities" for purposes of the Federal Reserve Board's
margin regulations.
The Shares are registered under the Exchange Act which requires, among
other things, that the Company furnish certain information to its shareholders
and to the Commission and comply with the Commission's proxy rules in connection
with meetings of the Company's shareholders. The Company believes that its
purchase of Shares pursuant to the Offer will not result in the Shares becoming
eligible for deregistration under the Exchange Act.
13. REGULATORY APPROVALS.
As a registered bank holding company, the Company is subject to the
supervision of the Federal Reserve Board. In addition, because of its ownership
of IOBOC, the Company is also regulated as a savings and loan holding company by
the OTS.
MNB is a member of the Federal Reserve System and is a member of the
Federal Deposit Insurance Corporation. The electronic funds transfer services of
MNB are governed by both state and federal laws.
The Company does not require prior regulatory approval to consummate the
Offer.
The Bank Holding Company Act of 1956 and the Change in Bank Control Act
each set forth thresholds with respect to the ownership of voting shares of a
bank holding company of 5% and 10%, respectively, over which the owner of such
voting shares may be determined to control such bank holding company. If, as a
result of the Offer, the ownership interest of any shareholder in the Company is
increased over these thresholds, such shareholder may be required to reduce its
ownership interest in the Company. Each shareholder whose ownership interest may
be so increased is urged to consult the shareholder's own legal counsel with
respect to the consequences to the shareholder of the offer.
22
<PAGE> 23
14. CERTAIN FEDERAL INCOME TAX CONSEQUENCES.
The following summary is a general discussion of certain of the United
States federal income tax consequences of the Offer. This summary is based upon
laws, regulations, rulings and decisions now in effect, all of which are subject
to change, possibly retroactively. No ruling as to any matter discussed in this
summary has been requested or received from the IRS.
EACH SHAREHOLDER IS URGED TO CONSULT AND RELY ON THE SHAREHOLDER'S OWN TAX
ADVISOR WITH RESPECT TO THE TAX CONSEQUENCES TO THE SHAREHOLDER OF TENDERING
SHARES PURSUANT TO THE OFFER.
IN GENERAL. A shareholder's exchange of Shares for cash pursuant to the
Offer will be a taxable transaction for federal income tax purposes, and may
also be a taxable transaction under applicable state, local, foreign or other
tax laws. This summary does not discuss any aspects of state, local, foreign or
other tax laws. Certain shareholders (including insurance companies, tax-exempt
organizations, financial institutions, broker dealers and shareholders who have
acquired their Shares upon the exercise of options or otherwise as compensation)
may be subject to special rules not discussed below. For purposes of this
discussion, shareholders are assumed to hold their Shares as capital assets.
TREATMENT AS A SALE OR EXCHANGE. Under Section 302 of the Internal Revenue
Code of 1986, as amended (the "Code"), a transfer of Shares to the Company
pursuant to the Offer will, as a general rule, be treated as a sale or exchange
of the Shares (rather than as a corporate distribution) if the receipt of cash
upon the sale (a) is "substantially disproportionate" with respect to the
shareholder, (b) results in a "complete termination" of the shareholder's
interest in the Company or (c) is "not essentially equivalent to a dividend"
with respect to the shareholder. These tests (the "Section 302 tests") are
explained more fully below.
If any of the Section 302 tests is satisfied, a tendering shareholder will
recognize capital gain or loss equal to the difference between the amount of
cash received by the shareholder pursuant to the Offer and the shareholder's
basis in the Shares sold pursuant to the Offer. If the Shares have been held for
more than one year, the gain or loss will be long-term capital gain or loss.
Therefore, a tendering Shareholder may wish to take the various bases and
holding periods of his Shares, if such characteristics are not uniform, into
account in determining which Shares to tender.
CONSTRUCTIVE OWNERSHIP OF STOCK. In determining whether any of the Section
302 tests is satisfied, a shareholder must take into account not only Shares
actually owned by the shareholder, but also Shares that are constructively owned
pursuant to Section 318 of the Code. Under Section 318, a shareholder may
constructively own Shares actually owned, and in some cases constructively
owned, by certain related individuals and entities in which the shareholder has
an interest, or, in the case of shareholders that are entities, by certain
individuals or entities that have an interest in the shareholder, as well as any
Shares the shareholder has a right to acquire by exercise of an option or by the
conversion or exchange of a security, such as the Convertible Securities. With
respect to option and convertible security attribution, the IRS takes the
position that Shares constructively owned by a shareholder by reason of a right
on the shareholder's part to acquire the Shares from the Company are not to be
considered outstanding for purposes of applying the Section 302 tests to other
shareholders; however, there are both contrary and supporting judicial decisions
with respect to this issue.
THE SECTION 302 TESTS. One of the following tests must be satisfied in
order for the exchange of shares pursuant to the Offer to be treated as a sale
rather than as a dividend distribution.
a. Substantially Disproportionate Test. The receipt of cash by a
shareholder will be substantially disproportionate with respect to the
shareholder if the percentage of the outstanding Shares actually and
constructively owned by the shareholder immediately following the
exchange of Shares pursuant to the Offer (treating Shares exchanged
pursuant to the Offer as not outstanding) is less than 80% of the
percentage of the outstanding Shares actually and constructively owned
by the shareholder immediately before the exchange (treating Shares
exchanged pursuant to the Offer as outstanding).
b. Complete Termination Test. The receipt of cash by a shareholder
will be a complete termination of the shareholder's interest if either
(i) all of the Shares actually and constructively
23
<PAGE> 24
owned by the shareholder are sold pursuant to the Offer or (ii) all of
the Shares actually owned by the shareholder are sold pursuant to the
Offer and the shareholder is eligible to waive, and effectively waives,
the attribution of Shares constructively owned by the shareholder in
accordance with the procedures described in Section 302(c)(2) of the
Code. Shareholders considering making such an election should do so in
consultation with their own tax advisors.
c. Not Essentially Equivalent to a Dividend Test. The receipt of
cash by a shareholder will not be essentially equivalent to a dividend
if the shareholder's exchange of Shares pursuant to the Offer results in
a "meaningful reduction" of the shareholder's proportionate interest in
the Company. Whether the receipt of cash by a shareholder will result in
a meaningful reduction of the shareholder's proportionate interest will
depend on the shareholder's particular facts and circumstances. However,
in the case of a small minority shareholder, even a small reduction may
satisfy this test where, as expected in the case of the Offer, payments
will not be pro rata with respect to all outstanding Shares. The IRS has
indicated in a published ruling that, in the case of a small minority
shareholder of a publicly held corporation who exercises no meaningful
control over corporate affairs, a reduction in the shareholder's
proportionate interest in the corporation from .0001118% to .0001081%
would constitute a meaningful reduction.
Although the issue is not free from doubt, a shareholder may be able to
take into account acquisitions or dispositions of Shares (including market
purchases and sales) substantially contemporaneous with the Offer in determining
whether any of the Section 302 tests is satisfied.
In the event that the Offer is oversubscribed, the Company's purchase of
Shares pursuant to the Offer will be prorated. Thus, in such case even if all
the Shares actually and constructively owned by a shareholder are tendered
pursuant to the Offer, not all of the Shares will be purchased by the Company,
which in turn may affect the shareholder's ability to satisfy the Section 302
tests.
TREATMENT AS A DIVIDEND. If none of the Section 302 tests is satisfied and,
as anticipated (although there can be no assurances), the Company has sufficient
earnings and profits, a tendering shareholder will be treated as having received
a dividend includible in gross income in an amount equal to the entire amount of
cash received by the shareholder pursuant to the Offer. This amount will not be
reduced by the shareholder's basis in the Shares exchanged pursuant to the
Offer, and (except as described below for corporate shareholders eligible for
the dividends-received deduction) the shareholder's basis in those Shares will
be added to the shareholder's basis in his remaining Shares. No assurance can be
given that any of the Section 302 tests will be satisfied as to any particular
shareholder, and thus no assurance can be given that any particular shareholder
will not be treated as having received a dividend taxable as ordinary income.
Any cash received for Shares pursuant to the Offer in excess of the Company's
earnings and profits will be treated, first, as a non-taxable return of capital
to the extent of the shareholder's basis for such shareholder's Shares, and,
thereafter, as a capital gain to the extent it exceeds such basis.
SPECIAL RULES FOR CORPORATE SHAREHOLDERS. To the extent that the exchange
of Shares by a corporate shareholder is treated as a dividend, the shareholder
generally will be entitled to a dividends-received deduction equal to 70% of the
dividend, subject to applicable limitations, including those relating to "debt-
financed portfolio stock" under Section 246A of the Code and to the 45-day
holding period requirement of Section 246(c) of the Code. Also, since it is
expected that purchases pursuant to the Offer will not be pro rata as to all
shareholders, any amount treated as a dividend to a corporate shareholder
generally is expected to constitute an "extraordinary dividend" subject to the
provisions of Section 1059 of the Code (except as may otherwise be provided in
regulations yet to be promulgated by the Treasury Department). Under Section
1059 of the Code, a corporate shareholder must reduce the tax basis of all such
shareholder's stock (but not below zero) by the portion of any "extraordinary
dividend" that is equal to the deduction allowable under the dividends received
deduction rules, and, if such portion exceeds the shareholder's tax basis for
the stock, must treat any such excess as additional gain on the subsequent sale
or other disposition of such stock.
BACKUP WITHHOLDING. See Section 3 concerning the potential application of
federal backup withholding.
FOREIGN SHAREHOLDERS. The Company will assume that the exchange is a
dividend as to foreign shareholders and will therefore withhold federal income
tax at a rate equal to 30% of the gross proceeds paid to a foreign shareholder
or his agent pursuant to the Offer, unless the Depositary determines that a
reduced rate
24
<PAGE> 25
of withholding is available pursuant to a tax treaty or that an exemption from
withholding is applicable because the gross proceeds are effectively connected
with the conduct of a trade or business by the foreign shareholder within the
United States. For this purpose, a foreign shareholder is any shareholder that
is not (a) a citizen or resident of the United States, (b) a corporation,
partnership or other entity created or organized in or under the laws of the
United States or any political subdivision thereof, or (c) any estate or trust
the income of which is subject to United States federal income taxation
regardless of the source of such income.
Generally, the determination of whether a reduced rate of withholding is
applicable is made by reference to a foreign shareholder's address or to a
properly completed Form 1001 furnished by the shareholder, and the determination
of whether an exemption from withholding is available on the grounds that gross
proceeds paid to a foreign shareholder are effectively connected with a United
States trade or business is made on the basis of a properly completed Form 4224
furnished by the shareholder. The Depositary will determine a foreign
shareholder's eligibility for a reduced rate of, or exemption from, withholding
by reference to the shareholder's address and any Forms 1001 or 4224 submitted
to the Depositary by a foreign shareholder unless facts and circumstances
indicate that such reliance is not warranted or unless applicable law requires
some other method for determining whether a reduced rate of withholding is
applicable. These forms can be obtained from the Depositary. See the
instructions to the Letter of Transmittal.
A foreign shareholder with respect to whom tax has been withheld may be
eligible to obtain a refund of all or a portion of the withheld tax if the
shareholder satisfies one of the Section 302 tests for capital gain treatment or
is otherwise able to establish that no tax or a reduced amount of tax was due.
Foreign shareholders are urged to consult their own tax advisors regarding the
application of federal income tax withholding, including eligibility for a
withholding tax reduction or exemption and the refund procedure.
15. EXTENSION OF THE OFFER; TERMINATION; AMENDMENTS.
The Company expressly reserves the right, at any time or from time to time,
in its sole discretion, to extend the period of time during which the Offer is
open by giving oral or written notice of such extension to the Depositary and
making a public announcement thereof. The Company also expressly reserves the
right, in its sole discretion, to terminate the Offer and not accept for payment
or pay for any Shares not theretofore accepted for payment or paid for or,
subject to applicable law, to postpone payment for Shares upon the occurrence of
any of the conditions specified in Section 6 by giving oral or written notice of
such termination or postponement to the Depositary and making a public
announcement thereof. The Company's reservation of the right to delay payment
for Shares which it has accepted for payment is limited by Rules 13e-4(f)(2) and
13e-4(f)(5) promulgated under the Exchange Act. Rule 13e-4(f)(2) requires that
the Company permit Shares tendered pursuant to the Offer to be withdrawn: (i) at
any time during the period the Offer remains open; and (ii) if not yet accepted
for payment, after the expiration of forty business days from the commencement
of the Offer. Rule 13e-4(f)(5) requires that the Company must either pay the
consideration offered or return the Shares tendered promptly after the
termination or withdrawal of the Offer. Subject to compliance with applicable
law, the Company further reserves the right, in its sole discretion, at any time
or from time to time to amend the Offer in any respect, including increasing or
decreasing the number of Shares the Company may purchase or the range of prices
it may pay pursuant to the Offer. Amendments to the Offer may be made at any
time or from time to time effected by public announcement thereof, such
announcement, in the case of an extension, to be issued no later than 9:00 a.m.,
New York City time, on the next business day after the previously scheduled
Expiration Date. Any public announcement made pursuant to the Offer will be
disseminated promptly to shareholders in a manner reasonably designed to inform
shareholders of such change. Without limiting the manner in which the Company
may choose to make a public announcement, except as required by applicable law,
the Company shall have no obligation to publish, advertise or otherwise
communicate any such public announcement other than by making a release to the
Dow Jones News Service.
If the Company materially changes the terms of the Offer or the information
concerning the Offer, or if it waives a material condition of the Offer, the
Company will extend the Offer to the extent required by Rules 13e-4(d)(2) and
13e-4(e)(2) promulgated under the Exchange Act. These rules require that the
minimum period during which an offer must remain open following material changes
in the terms of the offer or information concerning the offer (other than a
change in price or a change in percentage of securities
25
<PAGE> 26
sought) will depend on the facts and circumstances, including the relative
materiality of such terms or information. If (i) the Company increases or
decreases the price to be paid for Shares, or the Company increases the number
of Shares being sought and any such increase in the number of Shares being
sought exceeds 2% of the outstanding Shares, or the Company decreases the number
of Shares being sought and (ii) the Offer is scheduled to expire at any time
earlier than the expiration of a period ending on the tenth business day from,
and including, the date that notice of such increase or decrease is first
published, sent or given, the Offer will be extended until the expiration of
such period of ten business days.
16. FEES AND EXPENSES.
The Company has retained Keefe, Bruyette & Woods, Inc. ("KBW") and CS First
Boston Corporation ("FB") as Dealer Managers in connection with the Offer and
the Contract Offer. The Dealer Managers will each receive a fee of $.05 per
Share purchased by the Company pursuant to the Offer and a fee of $.05 per Stock
Purchase Contract purchased by the Company pursuant to the Contract Offer. The
Company will also reimburse KBW and FB for their reasonable out-of-pocket
expenses relating to the Offer, including reasonable fees and expenses of
counsel. The Company has agreed to indemnify KBW and FB against certain
liabilities in connection with the Offer, including certain liabilities under
the federal securities laws. The Dealer Managers have also rendered various
investment banking and other advisory services to the Company in the past, for
which they have received customary compensation.
The Company has retained Georgeson & Company Inc. as Information Agent and
First Chicago Trust Company of New York as Depositary in connection with the
Offer. The Information Agent may contact shareholders by mail, telephone, telex,
telegraph and personal interviews, and may request brokers, dealers and other
nominee shareholders to forward materials relating to the Offer to beneficial
owners. The Depositary and the Information Agent will receive reasonable and
customary compensation for their services. The Company will also reimburse the
Depositary and the Information Agent for out-of-pocket expenses, including
reasonable attorneys' fees, and has agreed to indemnify the Depositary and the
Information Agent against certain liabilities in connection with the Offer,
including certain liabilities under the federal securities laws. Neither the
Information Agent nor the Depositary has been retained to make solicitations or
recommendations in connection with the Offer.
The Company will not pay fees or commissions to any broker, dealer,
commercial bank, trust company or other person (other than the Dealer Managers)
for soliciting any Shares pursuant to the Offer. The Company will, however, on
request through the Information Agent, reimburse such persons for customary
handling and mailing expenses incurred in forwarding materials in respect of the
Offer to the beneficial owners for which they act as nominees. No such broker,
dealer, commercial bank or trust company has been authorized to act as the
Company's agent for purposes of this Offer. The Company will pay (or cause to be
paid) any stock transfer taxes on its purchase of Shares, except as otherwise
provided in Instruction 7 of the Letter of Transmittal.
17. MISCELLANEOUS.
The Offer is not being made to, nor will the Company accept tenders from,
holders of Shares in any jurisdiction in which the Offer or its acceptance would
not comply with the securities or Blue Sky laws of such jurisdiction. The
Company is not aware of any jurisdiction in which the making of the Offer or the
tender of Shares would not be in compliance with the laws of such jurisdiction.
However, the Company reserves the right to exclude holders in any jurisdiction
in which it is asserted that the Offer cannot lawfully be made. So long as the
Company makes a good faith effort to comply with any state law deemed applicable
to the Offer, if it cannot do so, the Company believes that the exclusion of
holders residing in such jurisdiction is permitted under Rule 13e-4(f)(9)
promulgated under the Exchange Act. In any jurisdiction the securities or Blue
Sky laws of which require the Offer to be made by a licensed broker or dealer,
the Offer shall be deemed to be made on the Company's behalf by KBW or FB, each
as Dealer Manager, or one or more registered brokers or dealers licensed under
the laws of such jurisdiction.
MICHIGAN NATIONAL CORPORATION
November 3, 1994
26
<PAGE> 27
SCHEDULE A
TRANSACTIONS EFFECTED BY DIRECTORS OR OFFICERS
Transactions since September 15, 1994, in the Shares or Contracts, effected
by, or for the benefit of, directors or officers:
1. 172 Shares were allocated to accounts of certain officers who participate in
Deferred Compensation Plan ("DCP"), on September 30, 1994. Allocation was
made as follows:
<TABLE>
<CAPTION>
DCP
---
<S> <C>
Lawrence L. Gladchun............................................................... 24
B. Matt Morris, III................................................................ 11
Robert V. Pannizzi................................................................. 13
William D. Ritsema................................................................. 8
Edward H. Sondker.................................................................. 3
Richard C. Webb.................................................................... 62
Richard E. Blough.................................................................. 51
---
172
</TABLE>
2. 38 Shares were received on September 15, 1994, and 28 Shares were received on
October 15, 1994, by Stanton Kinnie Smith, Jr., pursuant to a previous
election to defer director fees pursuant to the Company's Directors Deferred
Compensation Plan.
27
<PAGE> 28
Facsimile copies of the Letter of Transmittal will be accepted. The Letter
of Transmittal and certificates for the Shares and any other required documents
should be sent or delivered by each shareholder or his broker, dealer,
commercial bank, trust company or other nominee to the Depositary at one of its
addresses set forth below:
THE DEPOSITARY:
FIRST CHICAGO TRUST COMPANY OF NEW YORK
<TABLE>
<S> <C> <C>
By Mail: Facsimile Transmission: By Hand or Overnight Courier:
P.O. Box 2560 (201) 222-4720 or 14 Wall Street, 8th Floor
Mail Suite 4660 MNC (201) 222-4721 Attn: Tenders and Exchanges
Jersey City, New Jersey Confirmation of Facsimile Suite 4680 MNC
07303-2560 Transmission ONLY: New York, New York 10005
(201) 222-4707
</TABLE>
Any questions or requests for assistance or for additional copies of this
Offer to Purchase, the Letter of Transmittal or the Notice of Guaranteed
Delivery may be directed to the Information Agent at the telephone numbers and
addresses below. You may also contact either Dealer Manager or your broker,
dealer, commercial bank or trust company for assistance concerning the Offer. To
confirm delivery of your Shares, you are directed to contact the Depositary.
THE INFORMATION AGENT:
(LOGO)
WALL STREET PLAZA
NEW YORK, NEW YORK 10005
BANKS AND BROKERS CALL COLLECT:
(212) 440-9800
ALL OTHERS CALL TOLL-FREE:
1-800-223-2064
THE DEALER MANAGERS FOR THE OFFER ARE:
KEEFE, BRUYETTE & WOODS, INC. CS FIRST BOSTON CORPORATION
(212) 323-8450 (212) 909-2000
<PAGE> 1
EXHIBIT 99.(a)(2)
LETTER OF TRANSMITTAL
TO ACCOMPANY SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED SHARE PURCHASE RIGHTS)
OF
MICHIGAN NATIONAL CORPORATION
TENDERED PURSUANT TO THE OFFER TO PURCHASE
DATED NOVEMBER 3, 1994
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE
AT 5:00 P.M., NEW YORK CITY TIME,
ON FRIDAY, DECEMBER 2, 1994, UNLESS THE OFFER IS EXTENDED.
TO: FIRST CHICAGO TRUST COMPANY OF NEW YORK, DEPOSITARY
<TABLE>
<S> <C>
By Mail: By Hand or Overnight Courier:
P.O. Box 2560 14 Wall Street
Mail Suite 4660 MNC Attn: Tenders and Exchanges
Jersey City, New Jersey 07303-2560 8th Floor, Suite 4680 MNC
New York, New York 10005
</TABLE>
<TABLE>
<CAPTION>
DESCRIPTION OF SHARES TENDERED
(SEE INSTRUCTIONS 3 AND 4)
- ------------------------------------------------------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED OWNER(S)
(PLEASE FILL IN EXACTLY AS CERTIFICATE(S) TENDERED
NAME(S) APPEAR(S) ON CERTIFICATE(S)) (Attach signed list if necessary)
------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
NUMBER
OF SHARES NUMBER
CERTIFICATE REPRESENTED BY OF SHARES
NUMBER(S)* CERTIFICATE(S)* TENDERED**
---------------------------------------------------------------
---------------------------------------------------------------
---------------------------------------------------------------
---------------------------------------------------------------
---------------------------------------------------------------
---------------------------------------------------------------
---------------------------------------------------------------
TOTAL SHARES
TENDERED
------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* Need not be completed if Shares are delivered by book-entry transfer.
** If you desire to tender fewer than all Shares evidenced by
any certificates listed above, please indicate in this column the number
of Shares you wish to tender. Otherwise, all Shares evidenced by such
certificates will be deemed to have been tendered. See Instruction 4.
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN THOSE SHOWN ABOVE DOES
NOT CONSTITUTE A VALID DELIVERY.
THIS LETTER OF TRANSMITTAL IS TO BE USED ONLY (A) IF CERTIFICATES FOR
SHARES (AS DEFINED BELOW) ARE TO BE FORWARDED WITH IT, OR (B) IF A TENDER OF
SHARES IS TO BE MADE BY BOOK-ENTRY TRANSFER TO THE ACCOUNT MAINTAINED BY THE
DEPOSITARY AT THE DEPOSITORY TRUST COMPANY ("DTC"), THE MIDWEST SECURITIES TRUST
COMPANY ("MSTC"), OR THE PHILADELPHIA DEPOSITORY TRUST COMPANY ("PDTC")
(COLLECTIVELY, THE "BOOK-ENTRY TRANSFER FACILITIES") PURSUANT TO SECTION 3 OF
THE OFFER TO PURCHASE.
<PAGE> 2
ABSENT CIRCUMSTANCES CAUSING THE RIGHTS (AS DEFINED BELOW) TO BECOME
EXERCISABLE OR SEPARATELY TRADEABLE PRIOR TO THE EXPIRATION DATE (AS DEFINED IN
THE OFFER TO PURCHASE), A TENDER OF SHARES WILL ALSO CONSTITUTE A TENDER OF THE
ASSOCIATED RIGHTS. UNLESS THE CONTEXT REQUIRES OTHERWISE, ALL REFERENCES HEREIN
TO SHARES INCLUDE THE ASSOCIATED RIGHTS. SHAREHOLDERS WHOSE CERTIFICATES ARE NOT
IMMEDIATELY AVAILABLE OR WHO CANNOT DELIVER THEIR CERTIFICATES FOR SHARES AND
ALL OTHER DOCUMENTS THIS LETTER OF TRANSMITTAL REQUIRES TO THE DEPOSITARY AT OR
BEFORE THE EXPIRATION DATE (OR WHO ARE UNABLE TO COMPLY WITH THE PROCEDURE FOR
BOOK-ENTRY TRANSFER ON A TIMELY BASIS) MUST TENDER THEIR SHARES ACCORDING TO THE
GUARANTEED DELIVERY PROCEDURE SET FORTH IN SECTION 3 OF THE OFFER TO PURCHASE.
SEE INSTRUCTION 2. DELIVERY OF DOCUMENTS TO ONE OF THE BOOK-ENTRY TRANSFER
FACILITIES DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY.
<TABLE>
<S> <C>
/ / CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER MADE TO AN ACCOUNT
MAINTAINED BY THE DEPOSITARY WITH ONE OF THE BOOK-ENTRY TRANSFER FACILITIES AND COMPLETE THE
FOLLOWING:
Name of Tendering Institution:
Check Box of Applicable Book-Entry Transfer Facility:
/ / DTC
/ / MSTC
/ / PDTC
Account Number:
Transaction Code Number:
/ / CHECK HERE IF CERTIFICATES FOR TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE OF
GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE FOLLOWING:
Name(s) of Registered Owner(s):
Date of Execution of Notice of Guaranteed Delivery:
Name of Institution Which Guaranteed Delivery:
Check Box of Applicable Book-Entry Transfer Facility and give Account Number and Transaction Code
if Delivered by Book-Entry Transfer:
/ / DTC
/ / MSTC
/ / PDTC
Account Number:
Transaction Code Number:
</TABLE>
To FIRST CHICAGO TRUST COMPANY OF NEW YORK:
The undersigned hereby tenders to Michigan National Corporation, a Michigan
corporation (the "Company"), the above-described shares of the Company's common
stock, par value $10.00 per share (including the associated Preferred Share
Purchase Rights (the "Rights"), the "Shares"), at the price per Share indicated
in this Letter of Transmittal, net to the seller in cash, upon the terms and
subject to the conditions set forth in the Company's Offer to Purchase dated
November 3, 1994, receipt of which is hereby acknowledged, and in this Letter of
Transmittal (which together constitute the "Offer"). Absent circumstances
causing the Rights to become exercisable or separately tradeable prior to the
Expiration Date, a tender of Shares will also constitute a tender of the
associated Rights. Unless the context requires otherwise, all references herein
to Shares include the associated Rights.
Subject to and effective on acceptance for payment of the Shares tendered
hereby in accordance with the terms of the Offer (including, if the Offer is
extended or amended, the terms or conditions of any such extension or
amendment), the undersigned hereby sells, assigns, and transfers to or upon the
order of the Company all right, title and interest in and to all Shares tendered
hereby or orders the registration of such Shares tendered by book-entry transfer
that are purchased pursuant to the Offer to or upon the order of the Company and
hereby irrevocably constitutes and appoints the Depositary
<PAGE> 3
as attorney-in-fact of the undersigned with respect to such Shares, with full
power of substitution (such power of attorney being an irrevocable power coupled
with interest), to:
(a) deliver certificates for such Shares, or transfer ownership of
such Shares on the account books maintained by a Book-Entry Transfer
Facility, together in either such case with all accompanying evidences of
transfer and authenticity, to or upon the order of the Company, upon
receipt by the Depositary, as the undersigned's agent, of the Purchase
Price (as defined below) with respect to such Shares;
(b) present certificates for such Shares for cancellation and transfer
on the Company's books; and
(c) receive all benefits and otherwise exercise all rights of
beneficial ownership of such Shares, all in accordance with the terms of
the Offer.
The undersigned hereby represents and warrants to the Company that:
(a) the undersigned understands that tenders of Shares pursuant to any
one of the procedures described in Section 3 of the Offer to Purchase and
in the Instructions hereto will constitute the undersigned's acceptance of
the terms and conditions of the Offer, including the undersigned's
representation and warranty that (i) the undersigned has a net long
position in Shares or equivalent securities at least equal to the Shares
tendered within the meaning of Rule 14e-4 promulgated under the Securities
Exchange Act of 1934, as amended, and (ii) such tender of Shares complies
with Rule 14e-4;
(b) when and to the extent the Company accepts the Shares for
purchase, the Company will acquire good, marketable and unencumbered title
to them, free and clear of all security interests, liens, charges,
encumbrances, conditional sales agreements or other obligations relating to
their sale or transfer, and not subject to any adverse claim;
(c) on request, the undersigned will execute and deliver any
additional documents the Depositary or the Company deems necessary or
desirable to complete the assignment, transfer and purchase of the Shares
tendered hereby; and
(d) the undersigned has read and agrees to all of the terms of the
Offer.
The names and addresses of the registered owners should be printed, if they
are not already printed above, exactly as they appear on the certificates
representing Shares tendered hereby. The certificate numbers, the number of
Shares represented by such certificates, the number of Shares that the
undersigned wishes to tender and the purchase price at which such Shares are
being tendered should be indicated in the appropriate boxes.
The undersigned understands that the Company will determine a single per
Share price (not greater than $90 nor less than $78 per Share) (the "Purchase
Price") that it will pay for Shares validly tendered pursuant to the Offer
taking into account the number of Shares so tendered and the prices specified by
tendering shareholders. The undersigned understands that the Company will select
the Purchase Price that will allow it to buy 1,858,650 Shares (or such lesser
number of Shares as are validly tendered at prices not greater than $90 nor less
than $78 per Share) pursuant to the Offer. The undersigned understands that all
Shares validly tendered at prices at or below the Purchase Price will be
purchased at the Purchase Price, net to the seller in cash, upon the terms and
subject to the conditions of the Offer, including its proration provisions, and
that the Company will return all other Shares, including Shares tendered and not
withdrawn at prices greater than the Purchase Price and Shares not purchased
because of proration.
The undersigned recognizes that under certain circumstances set forth in
the Offer to Purchase, the Company may terminate or amend the Offer or may not
be required to purchase any of the Shares tendered hereby or may accept for
payment fewer than all of the Shares tendered hereby. The undersigned
understands that certificate(s) for any Shares not tendered or not purchased
will be returned to the undersigned at the address indicated above, unless
otherwise indicated under the "Special Payment Instructions" or "Special
Delivery Instructions" below. The undersigned recognizes that the Company has no
obligation, pursuant to the "Special Payments Instructions," to transfer any
certificate for Shares from the name of their registered owner, or to order the
registration or transfer of such Shares tendered by book-entry transfer, if the
Company purchases none of the Shares represented by such certificate or tendered
by such book-entry transfer.
The undersigned understands that acceptance of Shares by the Company for
payment will constitute a binding agreement between the undersigned and the
Company upon the terms and subject to the conditions of the Offer.
The check for the Purchase Price for such of the tendered Shares as are
purchased will be issued to the order of the undersigned and mailed to the
address indicated above unless otherwise indicated under the "Special Payment
Instructions" or the "Special Delivery Instructions" below.
All authority conferred or agreed to be conferred in this Letter of
Transmittal shall survive the death or incapacity of the undersigned, and any
obligations of the undersigned under this Letter of Transmittal shall be binding
upon the heirs, personal representatives, successors and assigns of the
undersigned. Except as stated in the Offer to Purchase, this tender is
irrevocable.
<PAGE> 4
NOTE: SIGNATURES MUST BE PROVIDED BELOW
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY
- --------------------------------------------------------------------------------
PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING TENDERED.
------------------------------------
IF SHARES ARE BEING TENDERED AT MORE THAN ONE PRICE, USE A
SEPARATE LETTER OF TRANSMITTAL FOR EACH PRICE SPECIFIED.
(SEE INSTRUCTION 5)
------------------------------------
CHECK ONLY ONE BOX.
IF MORE THAN ONE BOX IS CHECKED, OR IF NO BOX IS CHECKED
(EXCEPT AS PROVIDED IN THE ODD LOTS INSTRUCTIONS TO THE RIGHT),
THERE IS NO VALID TENDER OF SHARES.
------------------------------------
SHARES TENDERED AT PRICE DETERMINED
PURSUANT TO OFFER
/ / THE UNDERSIGNED WANTS TO MAXIMIZE THE CHANCE OF HAVING MICHIGAN
NATIONAL CORPORATION PURCHASE ALL THE SHARES THE UNDERSIGNED IS
TENDERING (SUBJECT TO THE POSSIBILITY OF PRORATION). ACCORDINGLY, BY
CHECKING THIS ONE BOX INSTEAD OF ONE OF THE PRICE BOXES BELOW, THE
UNDERSIGNED HEREBY TENDERS SHARES AND IS WILLING TO ACCEPT THE
PURCHASE PRICE DETERMINED PURSUANT TO THE OFFER. THIS ACTION WILL
RESULT IN RECEIVING A PRICE PER SHARE OF AS LOW AS $78.00 OR AS HIGH
AS $90.00.
------------------- OR ------------------
SHARES TENDERED AT PRICE
DETERMINED BY SHAREHOLDER
BY CHECKING ONE OF THE BOXES BELOW INSTEAD OF THE BOX ABOVE, THE
UNDERSIGNED HEREBY TENDERS SHARES AT THE PRICE CHECKED. THIS ACTION COULD
RESULT IN NONE OF THE SHARES BEING PURCHASED IF THE PURCHASE PRICE FOR THE
SHARES IS LESS THAN THE PRICE CHECKED.
PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING TENDERED:
<TABLE>
<S> <C> <C> <C> <C> <C>
/ / $78.000 / / $80.000 / / $82.000 / / $84.000 / / $86.000 / / $88.000
/ / 78.250 / / 80.250 / / 82.250 / / 84.250 / / 86.250 / / 88.250
/ / 78.500 / / 80.500 / / 82.500 / / 84.500 / / 86.500 / / 88.500
/ / 78.750 / / 80.750 / / 82.750 / / 84.750 / / 86.750 / / 88.750
/ / 79.000 / / 81.000 / / 83.000 / / 85.000 / / 87.000 / / 89.000
/ / 79.250 / / 81.250 / / 83.250 / / 85.250 / / 87.250 / / 89.250
/ / 79.500 / / 81.500 / / 83.500 / / 85.500 / / 87.500 / / 89.500
/ / 79.750 / / 81.750 / / 83.750 / / 85.750 / / 87.750 / / 89.750
/ / 90.000
</TABLE>
- --------------------------------------------------------------------------------
<PAGE> 5
ODD LOTS
(See Instruction 8)
To be completed ONLY if Shares are being tendered by or on behalf of a
person owning beneficially, as of the close of business on November 2, 1994 and
who continue to own beneficially as of the Expiration Date (as defined below).
The undersigned either (check one box):
/ / was the beneficial owner, as of the close of business on November 2,
1994, of an aggregate of fewer than 100 Shares, all of which are being
tendered, or
/ / is a broker, dealer, commercial bank, trust company or other nominee
which
(a) is tendering, for the beneficial owners thereof, Shares with respect
to which it is the record owner, and
(b) believes, based on representations made to it by such beneficial
owners, that each such person was the beneficial owner, as of the
close of business on November 2, 1994 of an aggregate of fewer than
100 Shares and is tendering all such Shares.
<PAGE> 6
MICHIGAN NATIONAL CORPORATION
DIVIDEND REINVESTMENT PLAN SHARES
(SEE INSTRUCTION 14)
This section is to be completed ONLY if Shares held in the Reinvestment Plan
are to be tendered.
/ / By checking this box, the undersigned represents that the undersigned is a
participant in the Reinvestment Plan and hereby tenders the following number
of Shares held in the Reinvestment Plan account of the undersigned:
Shares*
* The undersigned understands and agrees that all Shares held in the
Reinvestment Plan account(s) of the undersigned will be tendered if the above
box is checked and the space above is left blank.
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 4, 6, 7 AND 9)
To be completed ONLY if certificate(s) for Shares not tendered or not
purchased and/or any check for the Purchase Price of Shares purchased are to be
issued in the name of and sent to someone other than the undersigned.
Issue: / / check / / certificate(s) to:
Name
(PLEASE PRINT)
Address
(INCLUDE ZIP CODE)
(TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER)
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 4, 6, 7 AND 9)
To be completed ONLY if certificate(s) for Shares not tendered or not
purchased and/or any check for the Purchase Price of Shares purchased, issued in
the name of the undersigned, are to be sent to someone other than the
undersigned, or to the undersigned at an address other than that shown above.
Mail: / / check / / certificate(s) to:
Name
(PLEASE PRINT)
Address
(INCLUDE ZIP CODE)
<PAGE> 7
--------------------------------------------------------------------------
SHAREHOLDER(S) SIGN HERE
(See Instructions 1 and 6)
(Please Complete Substitute Form W-9 Contained Herein)
SIGNATURE(S) OF OWNER(S)
Must be signed by registered owner(s) exactly as name(s) appear(s) on
certificate(s) or on a security position listing or by person(s)
authorized to become registered owner(s) by certificate(s) and
documents transmitted with this Letter of Transmittal. If signature is
by attorney-in-fact, executor, administrator, trustee, guardian,
officer of a corporation or another acting in a fiduciary or
representative capacity, please set forth the full title. See
Instruction 6.
PLEASE PRINT OR TYPE.
Dated: , 1994
Name(s)
(PLEASE PRINT)
Capacity (Full Title)
Area Code and
Telephone Number
Tax Identification or
Social Security Number(s)
MEDALLION GUARANTEE OF SIGNATURE(S)
(See Instructions 1 and 6)
Authorized Signature
Name
(PLEASE PRINT)
Title
Name of Firm
Address
(INCLUDE ZIP CODE)
Area Code and
Telephone Number
Dated: , 1994
---------------------------------------------------------------------------
<PAGE> 8
INSTRUCTIONS
FORMING PART OF THE TERMS OF THE OFFER
(1) Guarantee of Signatures. No signature guarantee is required if either:
(a) this Letter of Transmittal is signed by the registered owner of
the Shares exactly as the name of the registered holder appears on the
certificate (which term, for purposes of this document, shall include any
participant in a Book-Entry Transfer Facility whose name appears on a
security position listing as the owner of Shares) tendered with this Letter
of Transmittal and payment and delivery are to be made directly to such
owner unless such owner has completed either the box entitled "Special
Payment Instructions" or "Special Delivery Instructions" above; or
(b) such Shares are tendered for the account of a member firm of a
registered national securities exchange, a member of the National
Association of Securities Dealers, Inc. or a commercial bank or trust
company having an office, branch or agency in the United States (each such
entity an "Eligible Institution").
In all other cases, an Eligible Institution must Medallion guarantee all
signatures on this Letter of Transmittal. See Instruction 6.
(2) Delivery of Letter of Transmittal and Certificates: Guaranteed Delivery
Procedures. This Letter of Transmittal is to be used only if certificates are
delivered with it to the Depositary (or such certificates will be delivered
pursuant to a Notice of Guaranteed Delivery previously sent to the Depositary)
or if tenders are to be made pursuant to the procedure for tender by book-entry
transfer set forth in Section 3 of the Offer to Purchase. Certificates for all
physically tendered Shares or confirmation of a book-entry transfer into the
Depositary's account at a Book-Entry Transfer Facility of Shares tendered
electronically, together in each case with a properly completed and duly
executed Letter of Transmittal or facsimile of it, and any other documents
required by this Letter of Transmittal, should be mailed or delivered to the
Depositary at the appropriate address set forth herein and must be delivered to
the Depositary on or before the Expiration Date (as defined in the Offer to
Purchase).
Shareholders whose certificates are not immediately available or who cannot
deliver Shares and all other required documents to the Depositary on or before
the Expiration Date, or whose Shares cannot be delivered on a timely basis
pursuant to the procedures for book-entry transfer, may tender their Shares by
or through any Eligible Institution by properly completing (including the price
at which the Shares are being tendered) and duly executing and delivering a
Notice of Guaranteed Delivery (or facsimile of it) and by otherwise complying
with the guaranteed delivery procedure set forth in Section 3 of the Offer to
Purchase. Pursuant to such procedure, the certificates for all physically
tendered Shares, or book-entry confirmation, as the case may be, as well as a
properly completed and duly executed Letter of Transmittal and all other
documents required by this Letter of Transmittal, must be received by the
Depositary within five over-the-counter trading days after receipt by the
Depositary of such Notice of Guaranteed Delivery, all as provided in Section 3
of the Offer to Purchase.
The Notice of Guaranteed Delivery may be delivered by hand or transmitted
by telegram, telex, facsimile transmission or mail to the Depositary and must
include a signature guarantee by an Eligible Institution in the form set forth
in such Notice. For Shares to be validly tendered pursuant to the guaranteed
delivery procedure, the Depositary must receive the Notice of Guaranteed
Delivery on or before the Expiration Date.
THE METHOD OF DELIVERY OF ALL DOCUMENTS, INCLUDING CERTIFICATES FOR SHARES,
IS AT THE ELECTION AND RISK OF THE TENDERING SHAREHOLDER. IF DELIVERY IS BY
MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS
RECOMMENDED.
The Company will not accept any alternative, conditional or contingent
tenders, nor will it purchase any fractional Shares. All tendering shareholders,
by execution of this Letter of Transmittal (or a facsimile of it), waive any
right to receive any notice of the acceptance of their tender.
<PAGE> 9
(3) Inadequate Space. If the space provided in the box captioned
"Description of Shares Tendered" is inadequate, the certificate numbers and/or
the number of Shares should be listed on a separate signed schedule and attached
to this Letter of Transmittal.
(4) Partial Tenders and Unpurchased Shares. (Not applicable to shareholders
who tender by book-entry transfer.) If fewer than all of the Shares evidenced by
any certificate are to be tendered, fill in the number of Shares which are to be
tendered in the column entitled "Number of Shares Tendered." In such case, if
any tendered Shares are purchased, a new certificate for the remainder of the
Shares evidenced by the old certificate(s) will be issued and sent to the
registered holders, unless otherwise specified in either the "Special Payment
Instructions" or "Special Delivery Instructions" boxes on this Letter of
Transmittal, as soon as practicable after the Expiration Date. All Shares
represented by the certificate(s) listed and delivered to the Depositary are
deemed to have been tendered unless otherwise indicated.
(5) Indication of Price at which Shares are being Tendered. For Shares to
be properly tendered, the shareholder must check the box indicating the price
per Share at which he is tendering Shares under "Price (In Dollars) Per Share at
Which Shares Are Being Tendered" on this Letter of Transmittal, provided,
however, that a shareholder may check the box above in the section entitled
"PRICE (IN DOLLARS PER SHARE AT WHICH SHARES ARE BEING TENDERED)" indicating
that he is tendering all Shares at the Purchase Price. ONLY ONE BOX MAY BE
CHECKED. IF MORE THAN ONE BOX IS CHECKED OR IF NO BOX IS CHECKED, THERE IS NO
VALID TENDER OF SHARES. A shareholder wishing to tender portions of his Share
holdings at different prices must complete a separate Letter of Transmittal for
each price at which he wishes to tender each such portion of his Shares. The
same Shares cannot be tendered (unless previously properly withdrawn as provided
in Section 4 of the Offer to Purchase) at more than one price.
(6) Signatures on Letter of Transmittal, Stock Powers and Endorsements.
(a) If this Letter of Transmittal is signed by the registered owner(s)
of the Shares tendered hereby, the signature(s) must correspond exactly
with the name(s) as written on the face of the certificates without any
change whatsoever.
(b) If the Shares are registered in the names of two or more joint
owners, each such owner must sign this Letter of Transmittal.
(c) If any tendered Shares are registered in different names on
several certificates, it will be necessary to complete, sign and submit as
many separate Letters of Transmittal (or facsimiles thereof) as there are
different registrations of certificates.
(d) When this Letter of Transmittal is signed by the registered
owner(s) of the Shares listed and transmitted hereby, no endorsements of
certificate(s) representing such Shares or separate stock powers are
required unless payment is to be made, or the certificates for Shares not
tendered or not purchased are to be issued, to a person other than the
registered owner(s). Signatures on such certificates or stock powers must
be Medallion guaranteed by an Eligible Institution. If this Letter of
Transmittal is signed by a person other than the registered owner of the
certificates listed, however, the certificates must be endorsed or
accompanied by appropriate stock powers, in either case signed exactly as
the name(s) of the registered owner(s) appear(s) on the certificate, and
the signatures on such certificate or stock powers must be Medallion
guaranteed by an Eligible Institution. See Instruction 1.
(e) If this Letter of Transmittal or any certificates or stock powers
are signed by trustees, executors, administrators, guardians,
attorneys-in-fact, officers of corporations or others acting in a fiduciary
or representative capacity, such persons should so indicate when signing
and must submit proper evidence satisfactory to the Company of their
authority so to act.
<PAGE> 10
(7) Stock Transfer Taxes. Except as provided in this Instruction 7, no
stock transfer tax stamps or funds to cover such stamps need accompany this
Letter of Transmittal. The Company will pay or cause to be paid any stock
transfer taxes payable on the transfer to it of Shares purchased pursuant to the
Offer. If, however:
(a) payment of the Purchase Price is to be made to any person(s) other
than the registered owner(s);
(b) Shares not tendered or not accepted for purchase are to be
registered in the name of any person(s) other than the registered owner(s);
or
(c) tendered certificates are registered in the name(s) of any
person(s) other than the person(s) signing this Letter of Transmittal,
then the Depositary will deduct from the Purchase Price the amount of any stock
transfer taxes (whether imposed on the registered owner, such other person or
otherwise) payable on account of the transfer to such person unless satisfactory
evidence of the payment of such taxes or an exemption from them is submitted.
(8) Odd Lots. As described in Section 1 of the Offer to Purchase, if the
Company is to purchase less than all Shares tendered before the Expiration Date,
the Shares purchased first will consist of all Shares tendered by any
shareholder who owned beneficially, as of the close of business on November 2,
1994 and continues to own beneficially as of the Expiration Date, an aggregate
of fewer than 100 Shares and who tenders all of his Shares at or below the
Purchase Price (including by not designating a purchase price). This preference
will not be available unless the box captioned "Odd Lots" is completed.
(9) Special Payment and Delivery Instructions. If certificates for Shares
not tendered or not purchased and/or checks are to be issued in the name of a
person other than the person signing the Letter of Transmittal or if such
certificates and/or checks are to be sent to someone other than the person
signing the Letter of Transmittal or to the signer at a different address, the
boxes captioned "Special Payment Instructions" and/or "Special Delivery
Instructions" on this Letter of Transmittal should be completed as applicable
and signatures must be Medallion guaranteed as described in Instruction 1.
(10) Irregularities. The Company will determine, in its sole discretion,
all questions as to the number of Shares to be accepted, the price to be paid
therefor and the validity, form, eligibility (including time of receipt) and
acceptance for payment of any tender of Shares and its determination shall be
final and binding on all parties. The Company reserves the absolute right to
reject any or all tenders of Shares determined by it not to be in proper form or
the acceptance of or payment for which may be unlawful. The Company also
reserves the absolute right to waive any of the conditions of the Offer or any
defect or irregularity in the tender of any particular Shares and the Company's
interpretation of the terms of the Offer (including these instructions) will be
final and binding on all parties. No tender of Shares will be deemed to be
validly made until all defects and irregularities have been cured or waived.
Unless waived, any defects or irregularities in connection with tenders must be
cured within such time as the Company shall determine. None of the Company, the
Dealer Managers, the Depositary, the Information Agent nor any other person is
or will be obligated to give notice of defects or irregularities in tenders, nor
shall any of them incur any liability for failure to give any such notice.
(11) Questions and Requests for Assistance and Additional Copies. Questions
and request for assistance may be directed to, or additional copies of the Offer
to Purchase, the Notice of Guaranteed Delivery and this Letter of Transmittal
may be obtained from, the Information Agent at the address and telephone number
set forth at the end of this Letter of Transmittal or from your broker, dealer,
commercial bank or trust company.
(12) Substitute Form W-9. Each tendering shareholder (see "Important Tax
Information" below) is required to provide the Depositary with a correct
taxpayer identification number ("TIN") on Substitute Form W-9 (the "Form W-9")
which is provided under "Important Tax Information" below, and, if applicable,
to indicate that the shareholder is not subject to backup withholding by
checking the box in Part 2 of the form. Failure to provide the information on
the form or to check the box in Part 2 of the form may subject the tendering
shareholder to 31% federal income tax withholding on the payments made to the
shareholder or other payee with respect to Shares purchased pursuant to the
Offer. The box in Part 3 of the
<PAGE> 11
form may be checked if the tendering shareholder has not been issued a TIN and
has applied for a TIN or intends to apply for a TIN in the near future. If the
box in Part 3 is checked and the Depositary is not provided with a TIN within
sixty (60) days, the Depositary will withhold 31% on all such payments
thereafter until a TIN is provided to the Depositary.
(13) Withholding on Foreign Shareholders. The Depositary will withhold
federal income taxes equal to 30% of the gross payments payable to a foreign
shareholder unless the Depositary determines that a reduced rate of withholding
or an exemption from withholding is applicable. For this purpose, a foreign
shareholder is any shareholder that is not (i) a citizen or resident of the
United States, (ii) a corporation, partnership or other entity created or
organized in or under the laws of the United States or any political subdivision
thereof, or (iii) any estate or trust the income of which is subject to United
States federal income taxation regardless of the source of such income. The
Depositary will determine a shareholder's status as a foreign shareholder and
eligibility for a reduced rate of, or an exemption from, withholding by
reference to the shareholder's address and to any outstanding certificates or
statements concerning eligibility for a reduced rate of, or exemption from,
withholding unless facts and circumstances indicate that reliance is not
warranted. A foreign shareholder who has not previously submitted the
appropriate certificates or statements with respect to a reduced rate of, or
exemption from, withholding for which such shareholder may be eligible should
consider doing so in order to avoid overwithholding. A foreign shareholder may
be eligible to obtain a refund of tax withheld if such shareholder meets one of
the three tests for capital gain or loss treatment described in Section 13 of
the Offer to Purchase or is otherwise able to establish that no tax or a reduced
amount of tax was due.
(14) Dividend Reinvestment Plan. Shareholders who participate in the
Company's Dividend Reinvestment Plan who want to tender Shares held under that
plan pursuant to the Offer should mark the box under "MICHIGAN NATIONAL
CORPORATION DIVIDEND REINVESTMENT PLAN SHARES" and indicate the number of Shares
that are to be tendered. If such box is marked but the number of Shares to be
tendered is not indicated, all Shares held for the shareholder's account in the
Company's Dividend Reinvestment Plan will be tendered. All Shares held in the
Company's Dividend Reinvestment Plan will be tendered pursuant at the same price
listed under "PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING TENDERED."
IMPORTANT: THIS LETTER OF TRANSMITTAL OR A MANUALLY SIGNED FACSIMILE OF IT
(TOGETHER WITH CERTIFICATES FOR SHARES OR CONFIRMATION OF BOOK-ENTRY TRANSFER
AND ALL OTHER REQUIRED DOCUMENTS) OR THE NOTICE OF GUARANTEED DELIVERY MUST BE
RECEIVED BY THE DEPOSITARY ON OR BEFORE THE EXPIRATION DATE.
IMPORTANT TAX INFORMATION
Under federal income tax law, a shareholder whose tendered Shares are
accepted for payment is required to provide the Depositary with such
shareholder's correct TIN on Form W-9 below. If the Depositary is not provided
with the correct TIN, the Internal Revenue Service may subject the shareholder
or other payee to a $50.00 penalty. In addition, payments that are made to such
shareholder or other payee with respect to Shares purchased pursuant to the
Offer may be subject to backup withholding.
Certain shareholders (including, among others, all corporations and certain
foreign individuals) are considered "exempt recipients" and are not subject to
these backup withholding and reporting requirements. In order for a foreign
individual to qualify as an exempt recipient, the shareholder must submit a Form
W-8, signed under penalties of perjury, attesting to that individual's exempt
status. A Form W-8 can be obtained from the Depositary. See the enclosed
"Guidelines for Certification of Taxpayer Identification Number on Substitute
Form W-9" for more instructions.
If backup withholding applies, the Depositary is required to withhold 31%
of any such payments made to the shareholder or other payee. Backup withholding
is not an additional tax. Rather, the tax liability of persons
<PAGE> 12
subject to backup withholding will be reduced by the amount of tax withheld. If
withholding results in an overpayment of taxes, a refund may be obtained.
PURPOSE OF FORM W-9
To prevent backup withholding on payment made to a shareholder or other
payee with respect to Shares purchased pursuant to the Offer, the shareholder is
required to notify the Depositary of the shareholder's correct TIN by completing
the form below, certifying that the TIN provided on Form W-9 is correct (or that
such shareholder is awaiting a TIN) and that:
(a) the shareholder has not been notified by the Internal Revenue
Service that the shareholder is subject to backup withholding as a result
of failure to report all interest or dividends; or
(b) the Internal Revenue Service has notified the shareholder that the
shareholder is no longer subject to backup withholding.
The Shareholder is required to give the Depositary the TIN (e.g., social
security number or employer identification number) of the record owner of the
Shares. If the Shares are in more than one name or are not in the name of the
actual owner, consult the enclosed "Guidelines for Certification of Taxpayer
Identification Number on Form W-9" for additional guidance on which number to
report.
<PAGE> 13
PAYOR'S NAME: FIRST CHICAGO TRUST COMPANY OF NEW YORK
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------
<S> <C>
PART 1--PLEASE PROVIDE YOUR TIN IN THE BOX Social Security Number or
SUBSTITUTE AT RIGHT AND CERTIFY BY SIGNING AND DATING
BELOW.
Employee Identification Number
FORM W-9 --------------------------------------------------------------------------------
PART 2--Check the box if you are NOT subject to backup withholding under the
Internal Revenue Code because (a) I am (we are) exempt from backup withholding,
or (b) I (we) have not been notified that I am (we are) subject to backup
withholding as a result of failure to report all interest or dividends or (c)
the Internal Revenue Service has notified me (us) that I am (we are) no longer
subject to backup withholding.
/ / Correct / / Not Correct
---------------------------------------------------------------------------------
DEPARTMENT OF THE TREASURY CERTIFICATION -- UNDER PENALTIES OF PERJURY, I CERTIFY
INTERNAL REVENUE SERVICE THAT THE INFORMATION PROVIDED ON THIS FORM IS TRUE,
CORRECT, AND COMPLETE.
PAYER'S REQUEST FOR TAXPAYER PART 3--
IDENTIFICATION NUMBER ("TIN")
Signature Awaiting TIN / /
Date
- ------------------------------------------------------------------------------------------------------------------
</TABLE>
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP
WITHHOLDING OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE
REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN PART 3
OF FORM W-9.
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification number has
not been issued to me, and either (a) I have mailed or delivered an application
to receive a taxpayer identification number to the appropriate Internal
Revenue Service Center or Social Security Administration Office or (b) I intend
to mail or deliver an application in the near future. I understand that if I do
not provide a taxpayer identification number within sixty (60) days, 31% of all
reportable payments made to me thereafter will be withheld, until I provide a
number.
- ------------------------------ ------------------
Signature Date
<PAGE> 14
THE INFORMATION AGENT:
(LOGO)
Wall Street Plaza
New York, New York 10005
Banks and Brokers Call Collect:
(212) 440-9800
ALL OTHERS CALL TOLL-FREE:
1-800-223-2064
THE DEALER MANAGERS FOR THE OFFER ARE:
KEEFE, BRUYETTE & WOODS, INC. CS FIRST BOSTON CORPORATION
Two World Trade Center 55 East 52nd Street
New York, New York 10048 New York, New York 10055
(212) 323-8450 (Call Collect) (212) 909-2000 (Call
Collect)
<PAGE> 1
EXHIBIT 99.(a)(3)
NOT VALID UNLESS SIGNED BY AN ELIGIBLE INSTITUTION.
MICHIGAN NATIONAL CORPORATION
NOTICE OF GUARANTEED DELIVERY
OF SHARES OF COMMON STOCK
OFFER TO PURCHASE FOR CASH UP TO 1,858,650 SHARES
OF ITS COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED SHARE PURCHASE RIGHTS)
AT A PURCHASE PRICE NOT GREATER THAN
$90 NOR LESS THAN $78 PER SHARE
This form or a facsimile copy of it must be used to accept the Offer (as
defined below) if:
(a) certificates for common stock, par value $10.00 per share (the
"Shares"), including the associated Rights (as defined herein), of
Michigan National Corporation, a Michigan corporation, are not
immediately available; or
(b) the procedure for book-entry transfer cannot be completed on a timely
basis; or
(c) time will not permit the Letter of Transmittal or other required
documents to reach the Depositary before the Expiration Date (as defined
in Section 1 of the Offer to Purchase, as defined below).
This form or a facsimile of it, signed and properly completed, may be
delivered by hand, mail, telegram or facsimile transmission to the Depositary by
the Expiration Date. See Section 3 of the Offer to Purchase.
FIRST CHICAGO TRUST COMPANY OF NEW YORK, Depositary
<TABLE>
<S> <C> <C>
By Mail: Facsimile Transmission: By Hand or Overnight Courier:
P.O. Box 2560 (201) 222-4720 14 Wall Street
Mail Suite 4660 MNC (201) 222-4721 Attn: Tenders and Exchanges
Jersey City, New Jersey 07303-2560 Confirmation of Facsimile 8th Floor, Suite 4680 MNC
Transmission ONLY New York, New York 10005
(201) 222-4707
</TABLE>
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN THOSE SHOWN ABOVE OR
TRANSMISSION OF INSTRUCTIONS TO A FACSIMILE NUMBER OTHER THAN THOSE LISTED ABOVE
DOES NOT CONSTITUTE A VALID DELIVERY.
Ladies and Gentlemen:
The undersigned hereby tenders to Michigan National Corporation, at the
price per Share indicated below, net to the seller in cash, upon the terms and
subject to the conditions set forth in the Offer to Purchase, dated November 3,
1994 (the "Offer to Purchase"), and the related Letter of Transmittal (which
together with the Offer to Purchase constitute the "Offer"), receipt of which is
hereby acknowledged, Shares of common stock, par value $10.00 per Share
(including the associated Preferred Share Purchase Rights (the "Rights"), the
"Shares"), pursuant to the guaranteed delivery procedure set forth in Section 3
of the Offer to Purchase. Unless the Rights become exercisable or separately
tradeable prior to the Expiration Date, a tender of Shares will also constitute
a tender of the associated Rights. Unless the context requires otherwise, all
references herein to Shares include the associated Rights.
<PAGE> 2
- --------------------------------------------------------------------------------
PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING TENDERED.
------------------------------------
IF SHARES ARE BEING TENDERED AT MORE THAN ONE PRICE, USE A
SEPARATE NOTICE OF GUARANTEED DELIVERY FOR EACH PRICE SPECIFIED.
------------------------------------
CHECK ONLY ONE BOX. IF MORE THAN ONE BOX IS CHECKED, OR IF NO BOX IS
CHECKED (EXCEPT AS PROVIDED IN THE
ODD LOT INSTRUCTIONS TO THE RIGHT), THERE IS NO VALID TENDER OF SHARES.
------------------------------------
SHARES TENDERED AT PRICE DETERMINED PURSUANT TO THE OFFER
/ / THE UNDERSIGNED WANTS TO MAXIMIZE THE CHANCE OF HAVING MICHIGAN
NATIONAL CORPORATION PURCHASE ALL THE SHARES THE UNDERSIGNED IS
TENDERING (SUBJECT TO THE POSSIBILITY OF PRORATION). ACCORDINGLY, BY
CHECKING THIS ONE BOX INSTEAD OF ONE OF THE PRICE BOXES BELOW, THE
UNDERSIGNED HEREBY TENDERS SHARES AND IS WILLING TO ACCEPT THE
PURCHASE PRICE DETERMINED PURSUANT TO THE OFFER. THIS ACTION WILL
RESULT IN RECEIVING A PRICE PER SHARE OF AS LOW AS $78 OR AS HIGH AS
$90.
------------ OR ------------
SHARES TENDERED AT PRICE DETERMINED BY SHAREHOLDER
BY CHECKING ONE OF THE BOXES BELOW INSTEAD OF THE BOX ABOVE, THE
UNDERSIGNED HEREBY TENDERS SHARES AT THE PRICE CHECKED. THIS ACTION COULD
RESULT IN NONE OF THE SHARES BEING PURCHASED IF THE PURCHASE PRICE FOR THE
SHARES IS LESS THAN THE PRICE CHECKED.
PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING TENDERED:
<TABLE>
<S> <C> <C> <C> <C> <C>
/ / $78.000 / / $80.000 / / $82.000 / / $84.000 / / $86.000 / / $88.000
/ / 78.250 / / 80.250 / / 82.250 / / 84.250 / / 86.250 / / 88.250
/ / 78.500 / / 80.500 / / 82.500 / / 84.500 / / 86.500 / / 88.500
/ / 78.750 / / 80.750 / / 82.750 / / 84.750 / / 86.750 / / 88.750
/ / 79.000 / / 81.000 / / 83.000 / / 85.000 / / 87.000 / / 89.000
/ / 79.250 / / 81.250 / / 83.250 / / 85.250 / / 87.250 / / 89.250
/ / 79.500 / / 81.500 / / 83.500 / / 85.500 / / 87.500 / / 89.750
/ / 79.750 / / 81.750 / / 83.750 / / 85.750 / / 87.750 / / 89.750
/ / 90.000
</TABLE>
- --------------------------------------------------------------------------------
<PAGE> 3
- --------------------------------------------------------------------------------
ODD LOTS
To be completed ONLY if Shares are being tendered by or on behalf of
a person owning beneficially, as of the close of business on November 2,
1994 and who continue to own beneficially as of the Expiration Date, an
aggregate of fewer than 100 Shares.
The undersigned either (check one):
/ / was the beneficial owner, as of the close of business on November
2, 1994 of an aggregate of fewer than 100 Shares all of which are
being tendered, or
/ / is a broker, dealer, commercial bank, trust company or other
nominee which
(a) is tendering, for the beneficial owners thereof, Shares with
respect to which it is the record owner, and
(b) believes, based upon representations made to it by such
beneficial owners, that each such person was the beneficial
owner, as of the close of business on November 2, 1994 of an
aggregate of fewer than 100 Shares and is tendering all of such
Shares.
- --------------------------------------------------------------------------------
Certificate Nos. (if available):
...............................................................................
...............................................................................
If Shares will be tendered by book-entry transfer, check one box:
/ / The Depository Trust Company
/ / Midwest Securities Trust Company
/ / Philadelphia Depository Trust Company
Account Number:
...............................................................................
Name(s):
...............................................................................
...............................................................................
PLEASE TYPE OR PRINT
Address(es):
...............................................................................
...............................................................................
Area Code and
Telephone Number: ..............................................................
Sign Here: .....................................................................
...............................................................................
Dated: ..................................................................., 1994
GUARANTEE
(Not to be used for signature guarantee)
The undersigned, a member firm of a registered national securities
exchange, a member of the National Association of Securities Dealers, Inc., or a
commercial bank or trust company having an office or correspondent in the United
States (each, an "Eligible Institution"), hereby (i) represents that the
undersigned has a net long position in Shares or equivalent securities within
the meaning of Rule 14e-4 promulgated under the Securities Exchange Act of 1934,
as amended, at least equal to the Shares tendered, (ii) represents that such
tender of Shares complies with Rule 14e-4, and (iii) guarantees that either the
certificates representing the Shares tendered hereby in proper form for
transfer, or timely confirmation of the book-entry transfer of such Shares into
the Depositary's account at The Depository Trust Company, the Midwest Securities
Trust Company or the Philadelphia Depository Trust Company (pursuant to the
procedures set forth in Section 3 of the Offer to Purchase), together with a
properly completed and duly executed Letter of Transmittal (or facsimile
thereof) with any required signature guarantee and any other documents required
by the Letter of Transmittal, will be received by the Depositary at one of its
addresses set forth above within five New York Stock Exchange, Inc. trading days
after the date of execution hereof.
Name of Firm: ..................................................................
Address: .......................................................................
...............................................................................
Zip Code
Area Code and
Telephone Number: ..............................................................
...............................................................................
AUTHORIZED SIGNATURE
Name: ..........................................................................
Title: .........................................................................
Dated: .....................................................................1994
DO NOT SEND SHARE CERTIFICATES WITH THIS NOTICE. SHARE CERTIFICATES SHOULD BE
SENT WITH YOUR LETTER OF TRANSMITTAL.
<PAGE> 1
EXHIBIT 99.(a)(4)
Keefe, Bruyette & Woods, Inc.
Two World Trade Center
85th Floor
New York, New York 10048
CS First Boston Corporation
55 East 52nd Street
New York, New York 10055
MICHIGAN NATIONAL CORPORATION
OFFER TO PURCHASE FOR CASH
UP TO 1,858,650 SHARES OF ITS COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED SHARE PURCHASE RIGHTS)
AT A PURCHASE PRICE NOT GREATER THAN
$90 NOR LESS THAN $78 PER SHARE
November 3, 1994
To Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees:
Michigan National Corporation, a Michigan corporation (the "Company"), has
appointed us to act as Dealer Managers in connection with its offer to purchase
for cash up to 1,858,650 shares of its common stock, par value $10.00 per share
(including the associated Preferred Share Purchase Rights (the "Rights"), the
"Shares"), at prices, not greater than $90 nor less than $78 per Share, upon the
terms and subject to the conditions set forth in its Offer to Purchase dated
November 3, 1994 and in the related Letter of Transmittal (which together
constitute the "Offer"). We enclose the materials listed below relating to the
Offer. Unless the Rights become exercisable or separately tradeable prior to the
Expiration Date (as defined in Section 1 of the Offer to Purchase), a tender of
Shares will also constitute a tender of the associated Rights. Unless the
context requires otherwise, all references herein to Shares include the
associated Rights.
The Company will determine a single per Share price (not greater than $90
nor less than $78 per Share) (the "Purchase Price"), that it will pay for Shares
validly tendered pursuant to the Offer taking into account the number of Shares
so tendered and the prices specified by tendering shareholders. The Company will
select the Purchase Price which will allow it to buy 1,858,650 Shares (or such
lesser number of Shares as are validly tendered at prices not greater than $90
nor less than $78 per Share) pursuant to the Offer. All Shares validly tendered
at prices at or below the Purchase Price will be purchased at the Purchase
Price, net to the seller in cash, upon the terms and subject to the conditions
of the Offer, including the proration terms thereof. See Section 1 of the Offer
to Purchase.
If, prior to the Expiration Date, more than 1,858,650 Shares (or such
greater number of Shares as the Company may elect to purchase) are validly
tendered, the Company will, upon the terms and subject to the conditions of the
Offer, accept Shares for purchase first from Odd Lot Owners (as defined in
Section 2 of the Offer to Purchase) who validly tender their Shares at or below
the Purchase Price and then on a pro rata basis from all other shareholders
whose Shares are validly tendered at or below the Purchase Price.
The Offer is not conditioned on any minimum number of Shares being
tendered. The Offer is, however, subject to certain other conditions set forth
in the Offer. See Section 6 of the Offer to Purchase.
For your information and for forwarding to your clients for whom you hold
Shares registered in your name or in the name of your nominee, we are enclosing
the following documents:
1. Offer to Purchase dated November 3, 1994;
2. Letter to Clients which may be sent to your clients for whose
accounts you hold Shares registered in your name or in the name of your
nominee, with space provided for obtaining such clients' instructions with
regard to the Offer;
3. Letter, dated November 3, 1994, from Robert J. Mylod, Chairman of
the Board to shareholders of the Company;
<PAGE> 2
4. Letter of Transmittal for your use and for the information of your
clients (together with Substitute Form W-9 and guidelines); and
5. Notice of Guaranteed Delivery to be used to accept the Offer if
Share certificates and all other required documents cannot be delivered to
the Depositary by the Expiration Date or if the procedure for book-entry
transfer cannot be completed on a timely basis.
WE URGE YOU TO CONTACT YOUR CLIENTS AS PROMPTLY AS POSSIBLE. THE OFFER,
PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON FRIDAY, DECEMBER 2, 1994, UNLESS THE OFFER IS EXTENDED.
No fees or commissions will be payable to brokers, dealers or any other
persons for soliciting tenders of Shares pursuant to the Offer. The Company
will, however, upon request, reimburse you for customary mailing and handling
expenses incurred by you in forwarding any of the enclosed materials to the
beneficial owners of Shares held by you as a nominee or in a fiduciary capacity.
The Company will pay or cause to be paid any stock transfer taxes applicable to
its purchase of Shares, except as otherwise provided in Instruction 7 of the
Letter of Transmittal.
In order to take advantage of the Offer, a duly executed and properly
completed Letter of Transmittal and any other required documents should be sent
to the Depositary with either certificate(s) representing the tendered Shares or
confirmation of their book-entry transfer all in accordance with the
instructions set forth in the Letter of Transmittal and the Offer to Purchase.
As described in Section 3 of the Offer to Purchase, tenders may be made
without the concurrent deposit of stock certificates or concurrent compliance
with the procedure for book-entry transfer, if such tenders are made by or
through a broker or dealer which is a member firm of a registered national
securities exchange or a member of the National Association of Securities
Dealers, Inc. or a commercial bank or trust company having an office, branch or
agency in the United States. Certificates for Shares so tendered (or a
confirmation of a book-entry transfer of such Shares into the Depositary's
account at one of the "Book-Entry Transfer Facilities" described in Section 3 of
the Offer to Purchase), together with a properly completed and duly executed
Letter of Transmittal and any other documents required by the Letter of
Transmittal, must be received by the Depositary within five over-the-counter
trading days after timely receipt by the Depositary of a properly completed and
duly executed Notice of Guaranteed Delivery.
Any inquiries you may have with respect to the Offer should be addressed to
either of the Dealer Managers or to the Information Agent at their respective
addresses and telephone numbers set forth on the back cover page of the Offer to
Purchase.
Additional copies of the enclosed material may be obtained from the
Information Agent, Georgeson & Company Inc., telephone: (212) 440-9800
(collect).
Very truly yours,
KEEFE, BRUYETTE & WOODS, INC.
CS FIRST BOSTON CORPORATION
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU OR
ANY OTHER PERSON AS THE AGENT OF THE COMPANY, EITHER OF THE DEALER MANAGERS, THE
INFORMATION AGENT OR THE DEPOSITARY, OR AUTHORIZE YOU OR ANY OTHER PERSON TO USE
ANY DOCUMENT OR MAKE ANY STATEMENT ON BEHALF OF ANY OF THEM IN CONNECTION WITH
THE OFFER OTHER THAN THE ENCLOSED DOCUMENTS AND THE STATEMENTS CONTAINED
THEREIN.
2
<PAGE> 1
EXHIBIT 99.(a)(5)
MICHIGAN NATIONAL CORPORATION
OFFER TO PURCHASE FOR CASH
UP TO 1,858,650 SHARES OF ITS COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED SHARED PURCHASE RIGHTS)
AT A PURCHASE PRICE NOT GREATER THAN
$90 NOR LESS THAN $78 PER SHARE
November 3, 1994
To Our Clients:
Enclosed for your consideration are the Offer to Purchase, dated November
3, 1994, and the related Letter of Transmittal (which together constitute the
"Offer"), in connection with the offer by Michigan National Corporation, a
Michigan corporation (the "Company"), to purchase for cash up to 1,858,650
shares of its common stock, par value $10.00 per share (including the associated
Preferred Shared Purchase Rights (the "Rights"), the "Shares"), at prices not
greater than $90 nor less than $78 per Share, upon the terms and subject to the
conditions of the Offer. Unless the Rights become exercisable or separately
tradeable prior to the Expiration Date (as defined in Section 1 of the Offer to
Purchase), a tender of Shares will also constitute a tender of the associated
Rights. Unless the context requires otherwise, all references herein to Shares
include the associated Rights.
The Company will determine a single per Share price (not greater than $90
nor less than $78 per Share) (the "Purchase Price") that it will pay for Shares
validly tendered pursuant to the Offer taking into account the number of Shares
so tendered and the prices specified by tendering shareholders. The Company will
select the Purchase Price which will allow it to buy 1,858,650 Shares (or such
lesser number of Shares as are validly tendered at prices not greater than $90
nor less than $78 per Share) pursuant to the Offer. All Shares validly tendered
prior to the Expiration Date at prices at or below the Purchase Price will be
purchased at the Purchase Price, net to the seller in cash, upon the terms and
subject to the conditions of the Offer, including the proration terms thereof.
The Company will return all other Shares, including Shares tendered at prices
greater than the Purchase Price and Shares not purchased because of proration.
See Section 1 of the Offer to Purchase.
If, prior to the Expiration Date, more than 1,858,650 Shares (or such
greater number of Shares as the Company may elect to purchase) are validly
tendered, the Company will, upon the terms and subject to the conditions of the
Offer, accept Shares for purchase first from Odd Lot Owners (as defined in
Section 2 of the Offer to Purchase) who validly tender their Shares at or below
the Purchase Price and then on a pro rata basis from all other shareholders
whose Shares are validly tendered at or below the Purchase Price.
WE ARE THE HOLDER OF RECORD OF SHARES HELD FOR YOUR ACCOUNT. AS SUCH, WE
ARE THE ONLY ONES WHO CAN TENDER YOUR SHARES, AND THEN ONLY PURSUANT TO YOUR
INSTRUCTIONS. WE ARE SENDING YOU THE LETTER OF TRANSMITTAL FOR YOUR INFORMATION
ONLY; YOU CANNOT USE IT TO TENDER SHARES WE HOLD FOR YOUR ACCOUNT.
Please instruct us as to whether you wish us to tender any or all of the
Shares we hold for your account on the terms and subject to the conditions of
the Offer.
We call your attention to the following:
1. You may tender Shares at prices (in multiples of $.25), not greater
than $90 nor less than $78 per Share, as indicated in the attached
Instruction Form, net to you in cash.
2. The Offer is not conditioned on any minimum number of Shares being
tendered. The Offer is, however, subject to certain other conditions set
forth in the Offer.
3. The Offer, proration period and withdrawal rights will expire at
5:00 p.m., New York City time, on Friday, December 2, 1994, unless the
Company extends the Offer.
4. The Offer is for up to 1,858,650 Shares, constituting approximately
12% of the Shares outstanding as of October 29, 1994.
<PAGE> 2
5. Tendering shareholders will not be obligated to pay any brokerage
commissions, solicitation fees or, subject to Instruction 7 of the Letter
of Transmittal, stock transfer taxes on the Company's purchase of Shares
pursuant to the Offer.
6. If you owned beneficially as of the close of business on November
2, 1994 and continued to own beneficially as of the Expiration Date, an
aggregate of fewer than 100 Shares and you instruct us to tender on your
behalf all such Shares at or below the Purchase Price before the expiration
of the Offer and check the box captioned "Odd Lots" in the attached
Instruction Form, the Company, upon the terms and subject to the conditions
of the Offer, will accept all such Shares for purchase before proration, if
any, of the purchase of other Shares tendered at or below the Purchase
Price.
7. If you wish to tender portions of your Shares at different prices
you must complete a separate Instruction Form for each price at which you
wish to tender each such portion of your Shares. We must submit separate
Letters of Transmittal on your behalf for each price you will accept.
If you wish to have us tender any or all of your Shares, please so
instruct us by completing, executing, detaching and returning to us the
attached Instruction Form. An envelope to return your Instruction Form to
us is enclosed. If you authorize us to tender your Shares, we will tender
all such Shares unless you specify otherwise on the attached Instruction
Form.
YOUR INSTRUCTION FORM SHOULD BE FORWARDED TO US IN AMPLE TIME TO
PERMIT US TO SUBMIT A TENDER ON YOUR BEHALF ON OR BEFORE THE EXPIRATION
DATE OF THE OFFER. THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE
AT 5:00 P.M., NEW YORK CITY TIME, ON FRIDAY, DECEMBER 2, 1994, UNLESS THE
COMPANY EXTENDS THE OFFER.
As described in Section 1 of the Offer to Purchase, if before the
Expiration Date more than 1,858,650 Shares (or such greater number of
Shares as the Company elects to purchase) are validly tendered at or below
the Purchase Price, the Company will accept Shares for purchase at the
Purchase Price in the following order of priority:
(a) first, all Shares validly tendered at or below the Purchase Price
prior to the Expiration Date by any Odd Lot Owner who:
(1) tenders all Shares beneficially owned by such Odd Lot Owners at
or below the Purchase Price (partial tenders will not qualify for this
preference); and
(2) completes the section captioned "Odd Lots" on the Letter of
Transmittal and, if applicable, on the Notice of Guaranteed Delivery;
and
(b) then, after purchase of all of the foregoing Shares, all other
Shares validly tendered at or below the Purchase Price before the
Expiration Date on a pro rata basis, if necessary (with adjustments to
avoid purchases of fractional Shares).
The Offer is not being made to, nor will the Company accept tenders from,
holders of Shares in any jurisdiction in which the Offer or its acceptance would
not comply with the securities or Blue Sky laws of such jurisdiction. The
Company is not aware of any jurisdiction in which the making of the Offer or the
tender of Shares would not be in compliance with the laws of such jurisdictions.
However, the Company reserves the right to exclude holders in any jurisdiction
in which it is asserted that the Offer cannot lawfully be made. So long as the
Company makes a good faith effort to comply with any state law deemed applicable
to the Offer, if it cannot do so, the Company believes that the exclusion of
holders residing in such jurisdiction is permitted under Rule 13e-4(f)(9)
promulgated under the Exchange Act. In any jurisdiction the securities or Blue
Sky laws of which require the Offer to be made by a licensed broker or dealer,
the Offer shall be deemed to be made on the Company's behalf by Keefe, Bruyette
& Woods, Inc. and CS First Boston Corporation, as Dealer Managers, or one or
more registered brokers or dealers licensed under the laws of such jurisdiction.
2
<PAGE> 3
INSTRUCTION FORM
WITH RESPECT TO THE OFFER TO PURCHASE FOR CASH
UP TO 1,858,650 SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED SHARE PURCHASE RIGHTS) OF
MICHIGAN NATIONAL CORPORATION
AT A PURCHASE PRICE NOT GREATER THAN
$90 NOR LESS THAN $78 PER SHARE
The undersigned acknowledge(s) receipt of your letter and the enclosed
Offer to Purchase dated November 3, 1994 and the related Letter of Transmittal
(which together constitute the "Offer"), in connection with the offer by
Michigan National Corporation, a Michigan corporation (the "Company"), to
purchase for cash up to 1,858,650 shares of its common stock, par value $10.00
per share (including the associated Preferred Share Purchase Rights (the
"Rights"), the "Shares"), at prices not greater than $90 nor less than $78 per
Share, upon the terms and subject to the conditions of the Offer. Unless the
Rights become exercisable or separately tradeable prior to the Expiration Date
(as defined in Section 1 of the Offer to Purchase), a tender of Shares will also
constitute a tender of the associated Rights. Unless the context requires
otherwise, all references herein to Shares include the associated Rights.
The Company will determine a single per Share price (not greater than $90
nor less than $78 per Share) (the "Purchase Price") that it will pay for Shares
validly tendered pursuant to the Offer taking into account the number of Shares
so tendered and the prices specified by tendering shareholders. The Company will
select the Purchase Price which will allow it to buy 1,858,650 Shares (or such
lesser number of Shares as are validly tendered at prices not greater than $90
nor less than $78 per Share) pursuant to the Offer. All Shares validly tendered
at prices at or below the Purchase Price will be purchased at the Purchase
Price, net to the seller in cash, upon the terms and subject to the conditions
of the Offer, including the proration terms thereof. The Company will return all
other Shares, including Shares tendered at prices greater than the Purchase
Price and Shares not purchased because of proration. See Section 1 of the Offer
to Purchase.
The undersigned hereby instruct(s) you to tender to the Company the number
of Shares indicated below or, if no number is indicated, all Shares you hold for
the account of the undersigned, at the price per Share indicated below, pursuant
to the terms and subject to the conditions of the Offer.
3
<PAGE> 4
- --------------------------------------------------------------------------------
Aggregate number of Shares to be tendered by you for us: Shares*
------------------------------------
PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING TENDERED.
------------------------------------
IF SHARES ARE BEING TENDERED AT MORE THAN ONE PRICE, USE A
SEPARATE INSTRUCTION FORM.
------------------------------------
CHECK ONLY ONE BOX.
IF MORE THAN ONE BOX IS CHECKED,
OR IF NO BOX IS CHECKED (EXCEPT AS PROVIDED IN THE ODD LOTS
INSTRUCTIONS TO THE RIGHT), THERE WOULD BE NO VALID INSTRUCTION TO TENDER
SHARES.
------------------------------------
SHARES TENDERED AT PRICE DETERMINED PURSUANT TO THE OFFER
/ / THE UNDERSIGNED WANTS TO MAXIMIZE THE CHANCE OF HAVING MICHIGAN
NATIONAL CORPORATION PURCHASE ALL THE SHARES THE UNDERSIGNED IS
TENDERING (SUBJECT TO THE POSSIBILITY OF PRORATION). ACCORDINGLY, BY
CHECKING THIS ONE BOX INSTEAD OF ONE OF THE PRICE BOXES BELOW, THE
UNDERSIGNED HEREBY TENDERS SHARES AND IS WILLING TO ACCEPT THE
PURCHASE PRICE DETERMINED PURSUANT TO THE OFFER. THIS ACTION WILL
RESULT IN RECEIVING A PRICE PER SHARE AS LOW AS $78 OR AS HIGH AS $90.
------------ OR ------------
SHARES TENDERED AT PRICE DETERMINED BY SHAREHOLDER
BY CHECKING ONE OF THE BOXES BELOW INSTEAD OF THE BOX ABOVE, THE
UNDERSIGNED HEREBY TENDERS SHARES AT THE PRICE CHECKED. THIS ACTION COULD
RESULT IN NONE OF THE SHARES BEING PURCHASED IF THE PURCHASE PRICE FOR THE
SHARES IS LESS THAN THE PRICE CHECKED.
PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING TENDERED:
<TABLE>
<S> <C> <C> <C> <C> <C>
/ / $78.000 / / $80.000 / / $82.000 / / $84.000 / / $86.000 / / $88.000
/ / 78.250 / / 80.250 / / 82.250 / / 84.250 / / 86.250 / / 88.250
/ / 78.500 / / 80.500 / / 82.500 / / 84.500 / / 86.500 / / 88.500
/ / 78.750 / / 80.750 / / 82.750 / / 84.750 / / 86.750 / / 88.750
/ / 79.000 / / 81.000 / / 83.000 / / 85.000 / / 87.000 / / 89.000
/ / 79.250 / / 81.250 / / 83.250 / / 85.250 / / 87.250 / / 89.250
/ / 79.500 / / 81.500 / / 83.500 / / 85.500 / / 87.500 / / 89.750
/ / 79.750 / / 81.750 / / 83.750 / / 85.750 / / 87.750 / / 89.750
/ / 90.000
</TABLE>
------------------------------
ODD LOTS
/ / By checking this box, the undersigned represents that the undersigned
owned beneficially, as of the close of business on November 2, 1994,
and will continue to own beneficially as of the Expiration Date, an
aggregate of fewer than 100 Shares and is instructing the holder to
tender all such Shares.
- --------------------------------------------------------------------------------
* Unless otherwise indicated, all of the Shares, including the associated
Rights, held for the account of the undersigned will be tendered.
4
<PAGE> 5
- --------------------------------------------------------------------------------
SIGNATURE BOX
Signature(s)
Dated
Name(s) and Address(es) (Please Print)
--------------------------------------------------------------------------
--------------------------------------------------------------------------
Area Code and Telephone Number
Taxpayer Identification or Social Security Number
- --------------------------------------------------------------------------------
5
<PAGE> 1
EXHIBIT 99.(a)(6)
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
SECTION REFERENCES ARE TO THE INTERNAL REVENUE CODE.
Purpose of Form. -- A person who is required to file an information return
with the IRS must obtain your correct TIN to report income paid to you, real
estate transactions, mortgage interest you paid, the acquisition or abandonment
of secured property, or contributions you made to an IRA. Use Form W-9 to
furnish your correct TIN to the requester (the person asking you to furnish your
TIN) and, when applicable, (1) to certify that the TIN you are furnishing is
correct (or that you are waiting for a number to be issued), (2) to certify that
you are not subject to backup withholding, and (3) to claim exemption from
backup withholding if you are an exempt payee. Furnishing your correct TIN and
making the appropriate certifications will prevent certain payments from being
subject to backup withholding.
Note: If a requester gives you a form other than a W-9 to request your TIN,
you must use the requester's form.
How To Obtain a TIN. -- If you do not have a TIN, apply for one
immediately. To apply, get Form SS-5, Application for a Social Security Card
(for individuals), from your local office of the Social Security Administration,
or Form SS-4, Application for Employer Identification Number (for businesses and
all other entities), from your local IRS office.
To complete Form W-9 if you do not have a TIN, write "Applied for" in the
space for the TIN in Part I (or check box 2 of Substitute Form W-9), sign and
date the form, and give it to the requester. Generally, you must obtain a TIN
and furnish it to the requester by the time of payment. If the requester does
not receive your TIN by the time of payment, backup withholding, if applicable,
will begin and continue until you furnish your TIN to the requester.
Note: Writing "Applied for" (or checking box 2 of the Substitute Form W-9)
on the form means that you have already applied for a TIN OR that you intend to
apply for one in the near future.
As soon as you receive your TIN, complete another Form W-9, include your
TIN, sign and date the form, and give it to the requester.
What Is Backup Withholding? -- Persons making certain payments to you after
1992 are required to withhold and pay to the IRS 31% of such payments under
certain conditions. This is called "backup withholding." Payments that could be
subject to backup withholding include interest, dividends, broker and barter
exchange transactions, rents, royalties, nonemployee compensation, and certain
payments from fishing boat operators, but do not include real estate
transactions.
If you give the requester your correct TIN, make the appropriate
certifications, and report all your taxable interest and dividends on your tax
return, your payments will not be subject to backup withholding. Payments you
receive will be subject to backup withholding if:
1. You do not furnish your TIN to the requester, or
2. The IRS notifies the requester that you furnished an incorrect TIN,
or
3. You are notified by the IRS that you are subject to backup
withholding because you failed to report all your interest and dividends on
your tax return (for reportable interest and dividends only), or
4. You do not certify to the requester that you are not subject to
backup withholding under 3 above (for reportable interest and dividend
accounts opened after 1983 only), or
5. You do not certify your TIN. This applies only to reportable
interest, dividend, broker, or barter exchange accounts opened after 1983,
or broker accounts considered inactive in 1983.
Except as explained in 5 above, other reportable payments are subject to
backup withholding only if 1 or 2 above applies. Certain payees and payments are
exempt from backup withholding and information reporting.
<PAGE> 2
See Payees and Payments Exempt From Backup Withholding, below, and Example
Payees and Payments under Specific Instructions, below, if you are an exempt
payee.
Payees and Payments Exempt From Backup Withholding. -- The following is a
list of payees exempt from backup withholding and for which no information
reporting is required. For interest and dividends, all listed payees are exempt
except item (9). For broker transactions, payees listed in (1) through (13) and
a person registered under the Investment Advisers Act of 1940 who regularly acts
as a broker are exempt. Payments subject to reporting under sections 6041 and
6041A are generally exempt from backup withholding only if made to payees
described in items (1) through (7), except a corporation that provides medical
and health care services or bills and collects payments for such services is not
exempt from backup withholding or information reporting. Only payees described
in items (2) through (6) are exempt from backup withholding for barter exchange
transactions, patronage dividends, and payments by certain fishing boat
operators.
(1) A corporation. (2) An organization exempt from tax under section
501(a), or an IRA, or a custodial account under section 403(b)(7). (3) The
United States or any of its agencies or instrumentalities. (4) A state, the
District of Columbia, a possession of the United States, or any of their
political subdivisions or instrumentalities. (5) A foreign government or any of
its political subdivisions, agencies, or instrumentalities. (6) An international
organization or any of its agencies or instrumentalities. (7) A foreign central
bank of issue. (8) A dealer in securities or commodities required to register in
the United States or a possession of the United States. (9) A futures commission
merchant registered with the Commodity Futures Trading Commission. (10) A real
estate investment trust. (11) An entity registered at all times during the tax
year under the Investment Company Act of 1940. (12) A common trust fund operated
by a bank under section 584(a). (13) A financial institution. (14) A middleman
known in the investment community as a nominee or listed in the most recent
publication of the American Society of Corporate Secretaries, Inc., Nominee
List. (15) A trust exempt from tax under section 664 or described in section
4947.
Payments of dividend and patronage dividends generally not subject to
backup withholding include the following:
- Payments to nonresident aliens subject to withholding under section 1441.
- Payments to partnerships not engaged in a trade or business in the United
States and that have at least one nonresident partner.
- Payments of patronage dividends not paid in money.
- Payments made by certain foreign organizations.
Payments of interest generally not subject to backup withholding include the
following:
- Payments of interest on obligations issued by individuals.
Note: You may be subject to backup withholding if this interest is $600 or
more and is paid in the course of the payer's trade or business and you have not
provided your correct TIN to the payer.
- Payments of tax-exempt interest (including exempt-interest dividends
under section 852).
- Payments described in section 6049(b)(5) to nonresident aliens.
- Payments on tax-free covenant bonds under section 1451.
- Payments made by certain foreign organizations.
- Mortgage interest paid by you.
Payments that are not subject to information reporting are also not subject
to backup withholding. For details, see sections 6041, 6041A(a), 6042, 6044,
6045, 6049, 6050A, and 6050N, and their regulations.
<PAGE> 3
PENALTIES
Failure To Furnish TIN. -- If you fail to furnish your correct TIN to a
requester, you will be subject to a penalty of $50 for each such failure unless
your failure is due to reasonable cause and not to willful neglect.
Civil Penalty for False Information With Respect to Withholding. -- If you
make a false statement with no reasonable basis that results in no backup
withholding, you are subject to a $500 penalty.
Criminal Penalty for Falsifying Information. -- Willfully falsifying
certifications or affirmations may subject you to criminal penalties including
fines and/or imprisonment.
Misuse of TINS. -- If the requester discloses or uses TINs in violation of
Federal law, the requester may be subject to civil and criminal penalties.
SPECIFIC INSTRUCTIONS
Name. -- If you are an individual, you must generally provide the name
shown on your Social Security card. However, if you have changed your last name,
for instance, due to marriage, without informing the Social Security
Administration of the name change, please enter your first name, the last name
shown on your Social Security card, and your new last name.
If you are a sole proprietor, you must furnish your individual name and
either your SSN or EIN. You may also enter your business name or "doing business
as" name on the business name line. Enter your name(s) as shown on your Social
Security card and/or as it was used to apply for your EIN on Form SS-4.
SIGNING THE CERTIFICATION
1. Interest, Dividend, Broker and Barter Exchange Accounts Opened Before
1984 and Broker Accounts Considered Active During 1983. You are required to
furnish your correct TIN, but you are not required to sign the certification.
2. Interest, Dividend, Broker, and Barter Exchange Accounts Opened After
1983 and Broker Accounts Considered Inactive During 1983. You must sign the
certification or backup withholding will apply. If you are subject to backup
withholding and you are merely providing your correct TIN to the requester, you
must cross out item 2 in the certification before signing the form.
3. Real Estate Transactions. You must sign the certification. You may cross
out item 2 of the certification.
4. Other Payments. You are required to furnish your correct TIN, but you
are not required to sign the certification unless you have been notified of an
incorrect TIN. Other payments include payments made in the course of the
requester's trade or business for rents, royalties, goods (other than bills for
merchandise), medical and health care services, payments to a nonemployee for
services (including attorney and accounting fees), and payments to certain
fishing boat crew members.
5. Mortgage Interest Paid by You, Acquisition or Abandonment of Secured
Property, IRA Contributions. You are required to furnish your correct TIN, but
you are not required to sign the certification.
6. Exempt Payees and Payments. If you are exempt from backup withholding,
you should complete this form to avoid possible erroneous backup withholding.
Enter your correct TIN in Part I, write "EXEMPT" in the block in Part II, and
sign and date the form. If you are a nonresident alien or foreign entity not
subject to backup withholding, give the requester a complete Form W-8,
Certificate of Foreign Status.
7. TIN "Applied for." Follow the instructions under How To Obtain a TIN on
page 1, and sign and date this form.
Signature. -- For a joint account, only the person whose TIN is shown in
Part I should sign.
Privacy Act Notice. -- Section 6109 requires you to furnish your correct
TIN to persons who must file information returns with the IRS to report
interest, dividends, and certain other income paid to you, mortgage
<PAGE> 4
interest you paid, the acquisition or abandonment of secured property, or
contributions you made to an IRA. The IRS uses the numbers for identification
purposes and to help verify the accuracy of your tax return. You must provide
your TIN whether or not you are required to file a tax return. Payers must
generally withhold 31% of taxable interest, dividend, and certain other payments
to a payee who does not furnish a TIN to a payer. Certain penalties may also
apply.
WHAT NAME AND NUMBER TO GIVE THE REQUESTER
<TABLE>
<CAPTION>
For this type of account: Give name and SSN of:
<S> <C>
1. Individual.......................................... The individual
2. Two or more individuals (joint account)............. The actual owner of the account
or, if combined funds, the first
individual on the account(1)
3. Custodian account of a minor (Uniform Gift
to Minors Act)...................................... The minor(2)
4. a. The usual revocable savings trust (grantor is
also trustee).................................... The grantor-trustee(1)
b. So-called trust account that is not a legal or
valid trust under state law......................... The actual owner(1)
5. Sole proprietorship................................. The owner(3)
<CAPTION>
For this type of account: Give name and EIN of:
<S> <C>
6. Sole proprietorship................................. The owner(3)
7. A valid trust, estate, or pension trust............. Legal entity(4)
8. Corporate........................................... The corporation
9. Association, club, religious, charitable,
educational, or other tax-exempt organization....... The organization
10. Partnership......................................... The partnership
11. A broker or registered nominee...................... The broker or nominee
12. Account with the Department of Agriculture in the
name of a public entity (such as a state or local
government, school district or prison) that receives
agriculture program payments........................ The public entity
</TABLE>
- ---------------
(1) List first and circle the name of the person whose number you furnish.
(2) Circle the minor's name and furnish the minor's SSN.
(3) Show your individual name. You may also enter your business name. You may
use your SSN or EIN.
(4) List first and circle the name of the legal trust, estate, or pension trust.
(Do not furnish the TIN of the personal representative or trustee unless
the legal entity itself is not designated in the account title.)
Note: If no name is circled when there is more than one name, the number will be
considered to be that of the first name listed.
<PAGE> 1
EXHIBIT 99.(a)(7)
Joseph J. Whiteside
Chief Financial Officer
810/473-3474
MICHIGAN NATIONAL ANNOUNCES CASH SELF-TENDER OFFERS
FOR COMMON STOCK AND STOCK PURCHASE CONTRACTS
FARMINGTON HILLS, Mich. -- November 2, 1994 -- Michigan National Corporation
(MNCO) today announced that its board of directors has unanimously authorized
repurchase offers for its Common Stock and Cancelable Mandatory Stock Purchase
Contracts ("Purchase Contracts") totaling $200 million commencing November 3,
1994. The Common Stock repurchase offer of approximately $170 million will
take the form of a "Dutch Auction" for up to 1,858,650 of its Common Shares and
the Purchase Contract repurchase offer of approximately $30 million will be
made for any and all Purchase Contracts. The corporation is making the offers
as part of a comprehensive restructuring developed to enhance shareholder
value. The restructuring is intended to focus the corporation's resources on
its Michigan-based, core banking business, to streamline and enhance the
efficiency and profitability of that core business and to reposition the
corporation's balance sheet to increase return on equity by redeploying the
portion of the corporation's equity capital that is not necessary for the
corporation's Michigan-based, core banking business.
The Common Stock offer will amount to up to approximately $170 million in the
aggregate. The offer will allow shareholders to specify prices at which they
are willing to tender their shares at a price no greater than $90.00 and
-more-
<PAGE> 2
no less than $78.00 per share. After receiving tenders, the corporation will
select single per-share price which will allow it to buy up to the maximum
number of shares being sought. All shares purchased will be purchased at the
corporation-selected price for cash, even if tendered at a lower price. If
more than the maximum number of shares sought is tendered at or below the
corporation-selected price, shares will be pro rated.
The cash self-tender offer for any and all of the Purchase Contracts will be
at a price of $21.625. This offer will amount to up to approximately $30
million in the aggregate. If the price paid in the Dutch Auction self-tender
is higher than $78.00, the corporation will increase the price of the Purchase
Contract offer to the price paid in the Dutch Auction self-tender, less the
exercise price of the Purchase Contracts, which is currently $56.375.
As of October 28, 1994, the corporation had outstanding approximately
15,324,000 Common Shares and approximately 973,000 shares issuable pursuant to
the Purchase Contracts. Neither offer will be conditioned on a minimum number
of shares being tendered, but each will be subject to certain conditions set
forth in the offering documents. The corporation will file Schedules 13E-4
with the SEC on November 3, 1994, containing the terms and conditions of the
offers. Such materials will be mailed to shareholders and Purchase Contract
holders commencing November 3, 1994. The offers will expire on December 2,
1994, unless extended by the corporation.
The corporation has been advised that no director or executive officer of the
corporation intends to tender any shares pursuant to the Offer.
Keefe, Bruyette & Woods, Inc. and CS First Boston Corporation will act as
- more -
<PAGE> 3
the dealer managers for the tender offers, and Georgeson & Company Inc. will
act as information agent.
Michigan National Corp. is a diversified financial services corporation
headquartered in Farmington Hills, Michigan. It has 188 branches in Michigan
and total assets of $9.2 billion.
# # # # #
<PAGE> 1
EXHIBIT 99.(a)(8)
[MICHIGAN NATIONAL LETTERHEAD]
November 3, 1994
To Our Shareholders:
We are pleased to inform you that Michigan National Corporation is offering
to purchase 1,858,650 shares (representing approximately 12.13% of the currently
outstanding shares) of its common stock (including the associated Preferred
Share Purchase Rights) from its shareholders through a tender offer at prices
not greater than $90 nor less than $78 per share.
The Company is conducting the tender offer through a procedure commonly
referred to as a "Dutch Auction." This procedure allows you to select the price
within the above price range at which you are willing to sell some or all of
your shares to the Company. Based upon the number of shares tendered and the
prices specified by the tendering shareholders, Michigan National will determine
the single per share price within the above price range that will allow it to
buy 1,858,650 shares (or such lesser number of shares as are validly tendered).
All of the shares that are validly tendered at prices at or below that purchase
price will, subject to possible proration, be purchased at that purchase price,
net in cash to the selling shareholder. All other shares which have been
tendered and not purchased will be returned to the shareholder. The tender offer
is not conditioned on any minimum number of shares being tendered.
The Company is making this Offer as part of a comprehensive restructuring
developed to enhance shareholder value. The restructuring is intended to focus
the Company's resources on its Michigan-based, core banking business, to
streamline and enhance the efficiency and profitability of that core business
and to reposition the Company's balance sheet to increase return on equity by
redeploying the portion of the Company's equity capital that is not necessary
for the Company's Michigan-based, core banking business.
The Offer is explained in detail in the enclosed Offer to Purchase and
Letter of Transmittal. If you wish to tender your shares, detailed instructions
on how to tender shares are in the enclosed materials. We encourage you to read
these materials carefully before making any decision with respect to the Offer.
Please note that the tender offer is scheduled to expire at 5:00 p.m. on
December 2, 1994, unless extended by the Company. Neither the Company nor its
Board of Directors makes any recommendation to any shareholder as to whether to
tender or refrain from tendering shares.
Sincerely,
/s/ Robert J. Mylod
ROBERT J. MYLOD
Chairman of the Board
and Chief Executive Officer
<PAGE> 1
EXHIBIT 99.(a)(9)
This announcement is neither an offer to purchase nor a solicitation of an offer
to sell Shares. The Offer is made solely by the Offer to Purchase, dated
November 3, 1994, and the related Letter of Transmittal. Capitalized terms not
defined in this notice are defined in the Offer to Purchase. The Offer is
not being made to, nor will the Company accept tenders from, holders of
Shares in any jurisdictions in which the Offer or its Offer or its
acceptance would violate that jurisdiction's laws. The Company is not
aware of any jurisdiction in which the making of the Offer or the
tender of Shares would not be in compliance with the laws of such
jurisdiction. In those jurisdictions whose laws require that the
Offer be made by a licensed broker or dealer, the Offer shall be
deemed to be made on the Company's behalf by Keefe, Bruyette &
Woods, Inc. and CS First Boston Corporation or one or more
registered brokers or dealers licensed under the laws of such
jurisdictions.
NOTICE OF OFFER
BY
MICHIGAN NATIONAL CORPORATION
TO
PURCHASE FOR CASH
UP TO
1,858,650 SHARES OF ITS COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED SHARE PURCHASE RIGHTS)
AT A PURCHASE PRICE NOT GREATER THAN
$90 NOR LESS THAN $78 PER SHARE
Michigan National Corporation, a Michigan corporation (the "Company"),
invites shareholders to tender shares of its common stock, par value $10.00 per
share (including the associated Preferred Share Purchase Rights (the "Rights"),
the "Shares"), to the Company at prices, net to the seller in cash, not greater
than $90 nor less than $78 per Share, specified by such shareholders, upon the
terms and subject to the conditions set forth in the Offer to Purchase, dated
November 3, 1994 (the "Offer to Purchase"), and in the related Letter of
Transmittal (which together constitute the "Offer"). Absent circumstances
causing the Rights to become exercisable or separately tradeable prior to the
Expiration Date, the tender of Shares will also constitute a tender of the
associated Rights. Unless the context requires otherwise, all references herein
to Shares include the associated Rights. The information contained in the Offer
to Purchase and the Letter of Transmittal is incorporated by reference herein in
its entirety.
THE OFFER IS NOT CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING
TENDERED. THE OFFER IS, HOWEVER, SUBJECT TO CERTAIN OTHER CONDITIONS SET FORTH
IN THE OFFER.
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M.,
NEW YORK CITY TIME, ON FRIDAY, DECEMBER 2, 1994, UNLESS THE OFFER IS EXTENDED.
The Company will, upon the terms and subject to the conditions of the
Offer, determine a single per Share price (not greater than $90 nor less than
$78 per Share) (the "Purchase Price") that it will pay for Shares validly
tendered pursuant to the Offer taking into account the number of Shares so
tendered and the prices specified by tendering shareholders. The Company will
select the Purchase Price which will allow it to buy 1,858,650 Shares (or such
lesser number as are validly tendered at prices not greater than $90 nor less
than $78 per Share) pursuant to the Offer. All Shares validly tendered at prices
at or below the Purchase Price will be purchased at the Purchase Price, net to
the seller in cash, upon the terms and subject to the conditions of the Offer,
including the proration terms described below. For purposes of the Offer, the
Company will be deemed to have accepted for payment (and thereby purchased),
subject to proration, Shares which are validly tendered at or below the Purchase
Price when, as and if it gives oral or written notice to the Depositary of its
acceptance of such Shares for payment pursuant to the Offer. In all cases,
payment for Shares tendered and accepted for payment pursuant to the Offer will
be made only after timely receipt by the Depositary of certificates for such
Shares (or a timely confirmation of a book-entry transfer of such Shares into
the Depositary's account at one of the Book-Entry Transfer Facilities (as
defined in the Offer to Purchase)), a properly completed and duly executed
Letter of Transmittal (or facsimile thereof) and any other documents required by
the Letter of Transmittal.
Upon the terms and subject to the conditions of the Offer, in the event
that prior to the Expiration Date more than 1,858,650 Shares (or such greater
number of Shares as the Company may elect to purchase pursuant to the Offer) are
validly tendered at or below the Purchase Price, the Company will accept Shares
for purchase, in the following order of
<PAGE> 2
priority: (a) first, all Shares validly tendered by any Odd Lot Owner (as
defined in the Offer) who tenders all such Shares beneficially owned by such Odd
Lot Owner at or below the Purchase Price (partial tenders will not qualify for
this preference) and who completes the box captioned "Odd Lots" on the Letter of
Transmittal and, if applicable, on the Notice of Guaranteed Delivery, and (b)
then, after purchase of all of the foregoing Shares, all other Shares validly
tendered at or below the Purchase Price before the Expiration Date on a pro rata
basis, if necessary (with adjustments to avoid purchases of fractional Shares).
The Offer may provide shareholders who are considering a sale of all or a
portion of their Shares the opportunity to determine the price or prices (not
greater than $90 nor less than $78 per Share) at which they are willing to sell
their Shares and, if any such Shares are purchased pursuant to the Offer, to
sell those Shares for cash without the usual transaction costs associated with
open-market sales. The Company is making the Offer as part of a comprehensive
restructuring developed by the Company to enhance shareholder value by focusing
the Company's resources on its Michigan-based, core banking business, by
streamlining and enhancing the efficiency and profitability of that core
business, and by repositioning the Company's balance sheet to increase return on
equity by redeploying the portion of the Company's equity capital that is not
necessary for the Company's Michigan-based, core banking business.
THE BOARD OF DIRECTORS HAS UNANIMOUSLY APPROVED THE OFFER. HOWEVER, NEITHER
THE COMPANY NOR ITS BOARD OF DIRECTORS MAKES ANY RECOMMENDATION TO ANY
SHAREHOLDER AS TO WHETHER TO TENDER OR REFRAIN FROM TENDERING SHARES.
SHAREHOLDERS MUST MAKE THEIR OWN DECISIONS WHETHER TO TENDER SHARES AND, IF SO,
HOW MANY SHARES TO TENDER AND THE PRICE OR PRICES AT WHICH SHARES SHOULD BE
TENDERED. THE COMPANY HAS BEEN ADVISED THAT NO DIRECTOR OR EXECUTIVE OFFICER OF
THE COMPANY INTENDS TO TENDER ANY SHARES PURSUANT TO THE OFFER.
The Company reserves the right, at any time or from time to time, in its
sole discretion, to extend the period of time during which the Offer is open by
giving oral or written notice of such extension to the Depositary and making a
public announcement thereof. Subject to certain conditions, the Company also
expressly reserves the right to terminate the Offer and not accept for payment
any Shares not theretofore accepted for payment.
Shares tendered pursuant to the Offer may be withdrawn at any time prior to
the Expiration Date and, unless theretofore accepted for payment by the Company,
may also be withdrawn after 12:00 midnight, New York City time, on Tuesday,
January 3, 1995. For a withdrawal to be effective, the Depositary must timely
receive a written, telegraphic or facsimile transmission notice of withdrawal.
Such notice of withdrawal must specify the name of the person who tendered the
Shares to be withdrawn, the number of Shares to be withdrawn and the name of the
registered holder (if different from that of the person who tendered such
Shares). If the certificates have been delivered or otherwise identified to the
Depositary, then, prior to the release of such certificates, the tendering
shareholder must also submit the serial numbers of the particular certificates
evidencing the Shares to be withdrawn and the signature on the notice of
withdrawal must be Medallion guaranteed by an Eligible Institution (except in
the case of Shares tendered by an Eligible Institution). If Shares have been
tendered pursuant to the procedure for book-entry transfer set forth in the
Offer to Purchase, the notice of withdrawal must specify the name and number of
the account at the applicable Book-Entry Transfer Facility to be credited with
the withdrawn Shares and otherwise comply with the procedures of such facility.
THE OFFER TO PURCHASE AND THE LETTER OF TRANSMITTAL CONTAIN IMPORTANT
INFORMATION, WHICH SHOULD BE READ BEFORE SHAREHOLDERS DECIDE WHETHER TO ACCEPT
OR REJECT THE OFFER AND IF ACCEPTED, AT WHAT PRICE OR PRICES TO TENDER THEIR
SHARES. These materials are being mailed to record holders of Shares and are
being furnished to brokers, banks and similar persons whose names, or the names
of whose nominees, appear on the Company's shareholder list (or, if applicable,
who are listed as participants in a clearing agency's security position listing)
for transmittal to beneficial holders of Shares.
THE INFORMATION REQUIRED TO BE DISCLOSED BY RULE 13E-4(D)(1) OF THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, IS CONTAINED IN THE OFFER TO
PURCHASE AND IS INCORPORATED IN THIS NOTICE BY REFERENCE.
Please contact the Information Agent for copies of the Offer to Purchase,
the related Letter of Transmittal and other tender offer materials. It will
furnish copies promptly at the Company's expense.
<PAGE> 3
The Information Agent for the Offer is:
(LOGO)
WALL STREET PLAZA
NEW YORK, NEW YORK 10005
(212) 509-6240 (COLLECT)
BANKS AND BROKERS CALL COLLECT (212) 440-9800
CALL TOLL FREE: 1-800-223-2064
The Dealer Managers for the Offer are:
KEEFE, BRUYETTE & WOODS, INC. CS FIRST BOSTON CORPORATION
Two World Trade Center 55 East 52nd Street
New York, New York 10048 New York, New York 10055
(212) 323-8450 (call collect) (212) 909-2000 (call
collect)
NOVEMBER 3, 1994
<PAGE> 1
EXHIBIT 99.(a)(10)
[MNB Letterhead]
IMMEDIATE ATTENTION REQUIRED
November 3, 1994
RE: DIRECTION CONCERNING TENDER OF SHARES
DEAR DEFERRED COMPENSATION PLAN PARTICIPANT:
Enclosed are materials that require your immediate attention. They describe
matters directly affecting your interest in the Michigan National Corporation
Deferred Compensation Plan (Plan). Read all the materials carefully.
You may have up to five Accounts under the Plan, including a PAYSOP
Account, a Deferred Comp Account, a Pre-Tax Account, an After-Tax Account, and a
Rollover Account. There is a different colored Direction Form enclosed for each
Account. You will need to complete these Direction Forms and return them in the
postage paid envelope provided. THE DEADLINE FOR RECEIPT OF YOUR COMPLETED
DIRECTION FORMS IS 5:00 P.M., EST, TUESDAY, NOVEMBER 29, 1994 (UNLESS EXTENDED).
YOU SHOULD COMPLETE THE FORMS AND RETURN THEM EVEN IF YOU DECIDE NOT TO
PARTICIPATE IN THE TRANSACTION DESCRIBED IN THE MATERIALS.
The remainder of this letter summarizes the transaction and your rights and
options under the Plan, but you also should review the more detailed explanation
provided in the other materials.
BACKGROUND
As you no doubt have heard, Michigan National Corporation (Corporation) has
made a tender offer to purchase up to 1,858,650 shares of its common stock. The
objectives of the purchase, and financial and other information relating to the
offer, are described in detail in the enclosed Offer to Purchase, which is being
provided to all shareholders of the Corporation.
As a participant in the Plan, you are directly affected, because the
Corporation's Offer to Purchase extends to the approximately one million shares
of the Corporation's stock currently held by the Plan. Only Michigan National
Bank, as Trustee of the Plan, actually can tender these shares for sale.
However, as a Plan participant, you have the right pursuant to the provisions of
the Plan to direct the Trustee whether or not to tender the shares that are
allocated to your Plan Accounts as of October 31, 1994. If you elect to have the
Trustee tender these shares, you also are entitled to specify the price or
prices at which they should be tendered.
To assure the confidentiality of your decision, the Corporation has
retained First Chicago Trust Company of New York (First Chicago) to tabulate the
directions of Plan participants. You will note from the included envelope that
your Direction Forms are to be returned to First Chicago. To further assure
confidentiality and independence of all actions, Michigan National Bank and the
Plan's Investment Committee also have hired U.S. Trust Company of California,
N.A. (U.S. Trust) to make all discretionary determinations. In particular, U.S.
Trust will decide whether to tender or hold shares that are allocated to
Accounts of participants who fail to return timely or complete directions and
will determine whether the implementation of any participant directions or
adherence to any Plan provisions would be a violation of the Employee Retirement
Income Security Act of 1974 (ERISA). Although it is not anticipated that any
direction will violate ERISA, such that the direction would have to be reversed
or ignored, the Department of Labor requires that U.S. Trust, as the independent
fiduciary for Plan participants, retain this discretion.
HOW THE OFFER TO PURCHASE WORKS
The details of the Offer to Purchase are described in the enclosed
materials, which you should review carefully. However, in broad outline, the
transaction will work as follows with respect to Plan participants.
- The Corporation has offered to purchase up to 1,858,650 of its shares of
common stock at a price between $78 and $90 per share.
- If you want any of the shares that are allocated to your Plan Accounts
sold, you need to direct that they be offered (or "tendered") for sale.
<PAGE> 2
- You also need to specify the price at which you want the shares tendered.
That price must be between the two limits above. Alternatively, you have
the option to have your allocated shares tendered at whatever price is
finally determined to be the "Purchase Price," as explained below.
- After the deadline for the tender of shares by all shareholders,
including the Deferred Compensation Plan, First Chicago will tabulate all
directions, and the Corporation will determine the price, between the two
limits, at which the Corporation can purchase the number of shares that
it wants. This is referred to as the Purchase Price.
- Unless the offer is voided or discontinued in accordance with its terms,
the Corporation then will buy all the shares that were tendered at that
price or below. However, all sellers will receive the same Purchase
Price, even if they tendered below the Purchase Price.
- If you tender any shares at a price in excess of the Purchase Price as
finally determined, those shares will not be purchased, and they will
remain allocated to your Plan Accounts.
This type of transaction is commonly called a "Dutch Auction" and requires
some strategy on your part. For example, if you are anxious to sell, you may
want to tender your shares at a price at or near the lower limit. If you are not
sure whether or not you want to participate, but would be willing to sell at a
price above the lower limit, then you may want to specify a higher price, not to
exceed the upper limit, of course.
If you do not want to sell under any circumstances, an option is provided
for you to direct that shares allocated to your Plan Accounts be held.
Similarly, if you are sure that you want to sell and are willing to take any
price not below the lower limit of $78, then, as mentioned above, there is a
separate option provided for you under which all of your allocated shares will
be tendered at the Purchase Price.
Of course, U.S. Trust may override any direction that it determines is in
violation of ERISA, as previously described. In particular, the Corporation will
be prohibited from purchasing shares from the Plan if the Purchase Price, as
finally determined, is less than the prevailing market price of the shares on
the date the shares are accepted for purchase. Finally, the Corporation will
prorate the number of shares purchased from shareholders if there is an excess
of shares over the exact number desired at the Purchase Price as ultimately
determined.
PROCEDURE FOR DIRECTING TRUSTEE
A Direction Form for making your direction to the Trustee is enclosed for
each of your Accounts under the Plan that holds shares of the Corporation's
common stock. You must complete each form and return all of them in the included
envelope in time to be received no later than 5:00 p.m., EST, on Tuesday,
November 29, 1994 (unless the Offer to Purchase is extended or amended). If your
forms are not received by this deadline, or if they are not fully and properly
completed, the shares in your Plan Accounts will be tendered or held as decided
by U.S. Trust.
To properly complete your Direction Forms, you must do the following:
(1) On the face of each form, check Box 1, 2, or 3. CHECK ONLY ONE
BOX. Make your decision which box to check as follows:
- CHECK BOX 1 if you do not want the shares allocated to that Account
tendered for sale at any price and simply want the Trustee to continue
holding shares allocated to that Account.
- CHECK BOX 2 if you definitely want the Trustee to tender for sale all
of the shares allocated to your Account and are willing to accept any
price (not below $78 per share).
- CHECK BOX 3 in all other cases and complete lines A to F of the table
immediately below Box 3. (You should not complete the table if you
checked Box 1 or 2.) Use lines A to D to specify the number of shares
that you want tendered at each price indicated. Typically, you would
elect to have all of your shares tendered at a single price. However,
the form gives you the option of splitting your shares among several
prices. You must state the number of shares to be sold at each
indicated price by filling in the number of shares in the box
immediately below the price.
After you have specified your tender price or prices, you should total
the number of shares in each row A to D and insert the total of each
line in the box provided at the end of that line. Specify the number
of shares, if any, that you do not want tendered, but wish the Trustee
to hold, in the single box on line E.
Finally, total the shares in the end boxes of rows A to E and insert
the total in the box on line F. The total in this box must equal the
number of shares allocated to the particular Account as shown on the
address label on the reverse side of the Direction Form.
2
<PAGE> 3
(2) Turn the Direction Form over, and date and sign it in the spaces
provided.
(3) Return all completed Direction Forms in the included postage
prepaid envelope no later than 5:00 p.m., EST, on Tuesday, November 29,
1994 (unless this deadline is extended). Be sure to return the forms even
if you decide not to have the Trustee tender any shares.
Your direction will be deemed irrevocable unless withdrawn by 5:00 p.m., EST, on
Tuesday, November 29, 1994 (unless the Offer to Purchase is extended or
amended). To be effective, a notice of withdrawal of your direction must be in
writing and must be received by First Chicago at the following address:
FIRST CHICAGO TRUST COMPANY OF NEW YORK
Suite 4660 MCN
P.O. Box 2560
Jersey City, NJ 07303
Facsimile Transmission (201) 222-4720
(201) 222-4721
Your notice must include your name, address, Social Security number, and the
number of shares allocated to each of your Plan Accounts. Upon receipt of your
notice by First Chicago, your previous direction will be deemed cancelled. You
may direct the retendering of any shares in your Accounts by repeating the
previous instructions for directing the tendering set forth in this letter.
INVESTMENT OF TENDER PROCEEDS
For any Plan shares that are tendered and purchased by the Corporation, the
Corporation will pay cash to the Plan. U.S. Trust then will instruct the Trustee
whether to reinvest in shares of the Corporation's stock or in alternative
investments, being guided by the Plan's terms and the trust agreement, and
subject to the limitations of ERISA. However, if any shares are sold from a
Pre-Tax, After-Tax, or Rollover Account, it is contemplated that the proceeds
will be deposited in an interest bearing Money Market Fund and reinvested as of
December 30, 1994 in accordance with your most recent investment direction for
future Plan contributions, unless U.S. Trust determines that doing so would be
contrary to the requirements of ERISA.
Individual participants in the Plan will not receive any portion of the
tender proceeds. All such proceeds and the assets will remain in the Plan and
may be withdrawn only in accordance with the Plan's terms. No gain or loss will
be recognized by participants in the Plan for federal income tax purposes in
connection with the tender or sale of shares held in the Plan.
NO RECOMMENDATION
THE CORPORATION'S BOARD OF DIRECTORS HAS UNANIMOUSLY APPROVED THE MAKING OF
THE OFFER TO PURCHASE. HOWEVER, NEITHER THE CORPORATION, ITS BOARD OF DIRECTORS,
MICHIGAN NATIONAL BANK AS TRUSTEE, THE INVESTMENT COMMITTEE, OR ANY OTHER PARTY
MAKES ANY RECOMMENDATIONS TO PARTICIPANTS AS TO WHETHER TO TENDER SHARES, THE
PRICE AT WHICH TO TENDER, OR WHETHER TO REFRAIN FROM TENDERING SHARES. EACH
PARTICIPANT MUST MAKE HIS OR HER OWN DECISION ON THESE MATTERS.
CONFIDENTIALITY
AS MENTIONED ABOVE, BOTH FIRST CHICAGO AND U.S. TRUST HAVE BEEN RETAINED TO
HELP ASSURE THE CONFIDENTIALITY OF YOUR DECISION AS A PLAN PARTICIPANT. YOUR
DECISION WILL NOT BE DISCLOSED TO ANY DIRECTORS, OFFICERS, OR EMPLOYEES OF
MICHIGAN NATIONAL CORPORATION OR MICHIGAN NATIONAL BANK, EXCEPT FOR THE PURPOSE
OF ALLOCATING PROCEEDS TO YOUR PLAN ACCOUNTS IN THE EVENT THAT ALL OR A PORTION
OF YOUR SHARES ARE SOLD.
FURTHER INFORMATION
Although U.S. Trust also has no recommendation and cannot advise you what
to do, its representatives are prepared to answer any question that you may have
on the procedures involved in the Dutch Auction and your direction. U.S. Trust
also can help you complete your Direction Forms.
For this purpose, you may contact U.S. Trust at the following toll-free
number between 11:00 a.m. and 8:00 p.m., EST, Monday through Friday:
U.S. TRUST
1-800-535-3093
Your ability to instruct the Trustee concerning whether or not to tender
shares allocated to your Accounts is an important part of your rights as a Plan
participant. Please consider this letter and the enclosed materials carefully
and then return your Direction Forms promptly.
Sincerely,
Investment Committee for the Michigan
National Corporation
Deferred Compensation Plan
3
<PAGE> 4
- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
MICHIGAN NATIONAL CORPORATION
DEFERRED COMPENSATION PLAN
DIRECTION FORM FOR PAYSOP ACCOUNT
BEFORE COMPLETING THIS FORM, PLEASE READ CAREFULLY
THE ACCOMPANYING OFFER TO PURCHASE
See the Address Label on Reverse Side of This Form for the
Number of Shares Allocated to Your PAYSOP Account
In accordance with the Michigan National Corporation ("Corporation") Offer
to Purchase dated November 3, 1994, a copy of which I have received and read,
and pursuant to the pass-through provisions of the Michigan National Corporation
Deferred Compensation Plan ("Plan"), I hereby direct the Plan's Trustee,
Michigan National Bank, as follows (check only one box):
/ / 1. To refrain from tendering and to hold all shares allocated to my PAYSOP
Account.
/ / 2. To tender all shares allocated to my PAYSOP Account at the Purchase Price
determined by the Corporation.
/ / 3. To tender shares allocated to my PAYSOP Account at the price or prices
indicated below, except for any shares to be held as indicated on line E
below:
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------
PRICE $78.00 $78.25 $78.50 $78.75 $79.00 $79.25 $79.50 $79.75 $80.00 $80.25 $80.50 $80.75 ROW A TOTAL
-----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
A NUMBER
OF
SHARES
-----------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------
<CAPTION>
PRICE $81.00 $81.25 $81.50 $81.75 $82.00 $82.25 $82.50 $82.75 $83.00 $83.25 $83.50 $83.75 ROW B TOTAL
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
-----------------------------------------------------------------------------------------------------------------------
B NUMBER
OF
SHARES
-----------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------
<CAPTION>
PRICE $84.00 $84.25 $84.50 $84.75 $85.00 $85.25 $85.50 $85.75 $86.00 $86.25 $86.50 $86.75 ROW C TOTAL
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
-----------------------------------------------------------------------------------------------------------------------
C NUMBER
OF
SHARES
-----------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
<CAPTION>
PRICE $87.00 $87.25 $87.50 $87.75 $88.00 $88.25 $88.50 $88.75 $89.00 $89.25 $89.50 $89.75 $90.00 ROW D TOTAL
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
---------------------------------------------------------------------------------------------------------------------------
D NUMBER
OF
SHARES
--------------------------------------------------------------------------------------------------------------------------
-------
SHARES
E TO BE
HELD
-- -- -- -- -- -- -- -- -- -- -- -- --
-------
-------
TOTAL
F SHARES
-- -- -- -- -- -- -- -- -- -- -- -- --
-------
</TABLE>
Total the number of shares in each of rows A to D and insert that total in
the box at the end of each row. Show shares to be held in the box at the end of
row E. Total the numbers in the end boxes of rows A to E and insert that total
number in the end box of row F. The total in the box of row F must equal the
number of shares allocated to your PAYSOP Account as shown on the address label
on the reverse side of this form.
- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
<PAGE> 5
- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
INSTRUCTIONS
Carefully complete the face portion of this Direction Form. Then insert
today's date and sign your name in the spaces provided below. Enclose the form
in the included postage prepaid envelope and mail it promptly. Your Direction
Form must be received no later than 5:00 p.m., Eastern Standard Time, on
Tuesday, November 29, 1994. Direction Forms that are not fully or properly
completed, dated, and signed, or that are received after the deadline, will be
ignored, and the shares allocated to your PAYSOP Account will be held or
tendered, and if tendered, at a price, as determined by U.S. Trust Company of
California, N.A. Note that U.S. Trust also has the right to ignore any direction
that it determines cannot be implemented without violation of applicable law.
Neither the Corporation, its Board of Directors, Michigan National Bank as
Trustee, the Investment Committee, nor any other party makes any recommendation
to participants as to whether to tender shares, the price at which to tender, or
to refrain from tendering shares. Each participant must make his or her own
decision on these matters.
Date: , 1994
--------- -----------------------------------------
Your Signature
(Please sign as your name appears below)
As of October 31, 1994, there were allocated to your PAYSOP Account the number
of shares of Michigan National Corporation common stock shown to the right of
your address on the label below.
- -----------------------------------------
- -----------------------------------------
- -----------------------------------------
- -----------------------------------------
- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
<PAGE> 6
- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
MICHIGAN NATIONAL CORPORATION
DEFERRED COMPENSATION PLAN
DIRECTION FORM FOR DEFERRED COMP ACCOUNT
BEFORE COMPLETING THIS FORM, PLEASE READ CAREFULLY
THE ACCOMPANYING OFFER TO PURCHASE
See the Address Label on Reverse Side of This Form for the
Number of Shares Allocated to Your Deferred Comp Account
In accordance with the Michigan National Corporation ("Corporation") Offer
to Purchase dated November 3, 1994, a copy of which I have received and read,
and pursuant to the pass-through provisions of the Michigan National Corporation
Deferred Compensation Plan ("Plan"), I hereby direct the Plan's Trustee,
Michigan National Bank, as follows (check only one box):
/ / 1. To refrain from tendering and to hold all shares allocated to my Deferred
Comp Account.
/ / 2. To tender all shares allocated to my Deferred Comp Account at the
Purchase Price determined by the Corporation.
/ / 3. To tender shares allocated to my Deferred Comp Account at the price or
prices indicated below, except for any shares to be held as indicated on
line E below:
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------
PRICE $78.00 $78.25 $78.50 $78.75 $79.00 $79.25 $79.50 $79.75 $80.00 $80.25 $80.50 $80.75 ROW A TOTAL
------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
A NUMBER
OF
SHARES
------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------
<CAPTION>
PRICE $81.00 $81.25 $81.50 $81.75 $82.00 $82.25 $82.50 $82.75 $83.00 $83.25 $83.50 $83.75 ROW B TOTAL
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
------------------------------------------------------------------------------------------------------------------------
B NUMBER
OF
SHARES
------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------
<CAPTION>
PRICE $84.00 $84.25 $84.50 $84.75 $85.00 $85.25 $85.50 $85.75 $86.00 $86.25 $86.50 $86.75 ROW C TOTAL
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
-----------------------------------------------------------------------------------------------------------------------
C NUMBER
OF
SHARES
------------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------------
<CAPTION>
PRICE $87.00 $87.25 $87.50 $87.75 $88.00 $88.25 $88.50 $88.75 $89.00 $89.25 $89.50 $89.75 $90.00 ROW D TOTAL
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
-----------------------------------------------------------------------------------------------------------------------------
D NUMBER
OF
SHARES
----------------------------------------------------------------------------------------------------------------------------
-------
SHARES
E TO BE
HELD
-- -- -- -- -- -- -- -- -- -- -- -- --
-------
-------
TOTAL
F SHARES
-- -- -- -- -- -- -- -- -- -- -- -- --
-------
</TABLE>
Total the number of shares in each of rows A to D and insert that total in
the box at the end of each row. Show shares to be held in the box at the end of
row E. Total the numbers in the end boxes of rows A to E and insert that total
number in the end box of row F. The total in the box of row F must equal the
number of shares allocated to your Deferred Comp Account as shown on the address
label on the reverse side of this form.
- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
<PAGE> 7
- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
INSTRUCTIONS
Carefully complete the face portion of this Direction Form. Then insert
today's date and sign your name in the spaces provided below. Enclose the form
in the included postage prepaid envelope and mail it promptly. Your Direction
Form must be received no later than 5:00 p.m., Eastern Standard Time, on
Tuesday, November 29, 1994. Direction Forms that are not fully or properly
completed, dated, and signed, or that are received after the deadline, will be
ignored, and the shares allocated to your Deferred Comp Account will be held or
tendered, and if tendered, at a price, as determined by U.S. Trust Company of
California, N.A. Note that U.S. Trust also has the right to ignore any direction
that it determines cannot be implemented without violation of applicable law.
Neither the Corporation, its Board of Directors, Michigan National Bank as
Trustee, the Investment Committee, nor any other party makes any recommendation
to participants as to whether to tender shares, the price at which to tender, or
to refrain from tendering shares. Each participant must make his or her own
decision on these matters.
Date: , 1994
----------- -----------------------------------------
Your Signature
(Please sign as your name appears below)
As of October 31, 1994, there were allocated to your Deferred Comp Account the
number of shares of Michigan National Corporation common stock shown to the
right of your address on the label below.
-----------------------------------------
-----------------------------------------
-----------------------------------------
-----------------------------------------
- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
<PAGE> 8
- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
MICHIGAN NATIONAL CORPORATION
DEFERRED COMPENSATION PLAN
DIRECTION FORM FOR PRE-TAX ACCOUNT
BEFORE COMPLETING THIS FORM, PLEASE READ CAREFULLY
THE ACCOMPANYING OFFER TO PURCHASE
See the Address Label on Reverse Side of This Form for the
Number of Shares Allocated to Your Pre-Tax Account
In accordance with the Michigan National Corporation ("Corporation") Offer
to Purchase dated November 3, 1994, a copy of which I have received and read,
and pursuant to the pass-through provisions of the Michigan National Corporation
Deferred Compensation Plan ("Plan"), I hereby direct the Plan's Trustee,
Michigan National Bank, as follows (check only one box):
/ / 1. To refrain from tendering and to hold all shares allocated to my Pre-Tax
Account.
/ / 2. To tender all shares allocated to my Pre-Tax Account at the Purchase
Price determined by the Corporation.
/ / 3. To tender shares allocated to my Pre-Tax Account at the price or prices
indicated below, except for any shares to be held as indicated on line E
below:
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------
PRICE $78.00 $78.25 $78.50 $78.75 $79.00 $79.25 $79.50 $79.75 $80.00 $80.25 $80.50 $80.75 ROW A TOTAL
-----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
A NUMBER
OF
SHARES
-----------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------
<CAPTION>
PRICE $81.00 $81.25 $81.50 $81.75 $82.00 $82.25 $82.50 $82.75 $83.00 $83.25 $83.50 $83.75 ROW B TOTAL
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
-----------------------------------------------------------------------------------------------------------------------------
B NUMBER
OF
SHARES
-----------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------
<CAPTION>
PRICE $84.00 $84.25 $84.50 $84.75 $85.00 $85.25 $85.50 $85.75 $86.00 $86.25 $86.50 $86.75 ROW C TOTAL
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
-----------------------------------------------------------------------------------------------------------------------------
C NUMBER
OF
SHARES
-----------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------
<CAPTION>
PRICE $87.00 $87.25 $87.50 $87.75 $88.00 $88.25 $88.50 $88.75 $89.00 $89.25 $89.50 $89.75 $90.00 ROW D TOTAL
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
-----------------------------------------------------------------------------------------------------------------------------
D NUMBER
OF
SHARES
-----------------------------------------------------------------------------------------------------------------------------
-------
SHARES
E TO BE
HELD
-- -- -- -- -- -- -- -- -- -- -- -- --
-------
-------
TOTAL
F SHARES
-- -- -- -- -- -- -- -- -- -- -- -- --
-------
</TABLE>
Total the number of shares in each of rows A to D and insert that total in
the box at the end of each row. Show shares to be held in the box at the end of
row E. Total the numbers in the end boxes of rows A to E and insert that total
number in the end box of row F. The total in the box of row F must equal the
number of shares allocated to your Pre-Tax Account as shown on the address label
on the reverse side of this form.
- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
<PAGE> 9
- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
INSTRUCTIONS
Carefully complete the face portion of this Direction Form. Then insert
today's date and sign your name in the spaces provided below. Enclose the form
in the included postage prepaid envelope and mail it promptly. Your Direction
Form must be received no later than 5:00 p.m., Eastern Standard Time, on
Tuesday, November 29, 1994. Direction Forms that are not fully or properly
completed, dated, and signed, or that are received after the deadline, will be
ignored, and the shares allocated to your Pre-Tax Account will be held or
tendered, and if tendered, at a price, as determined by U.S. Trust Company of
California, N.A. Note that U.S. Trust also has the right to ignore any direction
that it determines cannot be implemented without violation of applicable law.
Neither the Corporation, its Board of Directors, Michigan National Bank as
Trustee, the Investment Committee, nor any other party makes any recommendation
to participants as to whether to tender shares, the price at which to tender, or
to refrain from tendering shares. Each participant must make his or her own
decision on these matters.
Date: , 1994
------- ----------------------------------------
Your Signature
(Please sign as your name appears below)
As of October 31, 1994, there were allocated to your Pre-Tax Account the number
of shares of Michigan National Corporation common stock shown to the right of
your address on the label below.
-----------------------------------------
-----------------------------------------
-----------------------------------------
-----------------------------------------
- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
<PAGE> 10
- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
MICHIGAN NATIONAL CORPORATION
DEFERRED COMPENSATION PLAN
DIRECTION FORM FOR AFTER-TAX ACCOUNT
BEFORE COMPLETING THIS FORM, PLEASE READ CAREFULLY
THE ACCOMPANYING OFFER TO PURCHASE
See the Address Label on Reverse Side of This Form for the
Number of Shares Allocated to Your After-Tax Account
In accordance with the Michigan National Corporation ("Corporation") Offer
to Purchase dated November 3, 1994, a copy of which I have received and read,
and pursuant to the pass-through provisions of the Michigan National Corporation
Deferred Compensation Plan ("Plan"), I hereby direct the Plan's Trustee,
Michigan National Bank, as follows (check only one box):
/ / 1. To refrain from tendering and to hold all shares allocated to my
After-Tax Account.
/ / 2. To tender all shares allocated to my After-Tax Account at the Purchase
Price determined by the Corporation.
/ / 3. To tender shares allocated to my After-Tax Account at the price or prices
indicated below, except for any shares to be held as indicated on line E
below:
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------------------------
PRICE $78.00 $78.25 $78.50 $78.75 $79.00 $79.25 $79.50 $79.75 $80.00 $80.25 $80.50 $80.75 ROW A TOTAL
-------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
A NUMBER
OF
SHARES
-------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
PRICE $81.00 $81.25 $81.50 $81.75 $82.00 $82.25 $82.50 $82.75 $83.00 $83.25 $83.50 $83.75 ROW B TOTAL
-------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
-------------------------------------------------------------------------------------------------------------------------------
B NUMBER
OF
SHARES
-------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
PRICE $84.00 $84.25 $84.50 $84.75 $85.00 $85.25 $85.50 $85.75 $86.00 $86.25 $86.50 $86.75 ROW C TOTAL
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
-------------------------------------------------------------------------------------------------------------------------------
C NUMBER
OF
SHARES
-------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
PRICE $87.00 $87.25 $87.50 $87.75 $88.00 $88.25 $88.50 $88.75 $89.00 $89.25 $89.50 $89.75 $90.00 ROW D TOTAL
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
-------------------------------------------------------------------------------------------------------------------------------
D NUMBER
OF
SHARES
-------------------------------------------------------------------------------------------------------------------------------
------
SHARES
E TO BE
HELD
-- -- -- -- -- -- -- -- -- -- -- -- --
------
------
TOTAL
F SHARES
-- -- -- -- -- -- -- -- -- -- -- -- --
------
</TABLE>
Total the number of shares in each of rows A to D and insert that total in
the box at the end of each row. Show shares to be held in the box at the end of
row E. Total the numbers in the end boxes of rows A to E and insert that total
number in the end box of row F. The total in the box of row F must equal the
number of shares allocated to your After-Tax Account as shown on the address
label on the reverse side of this form.
- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
<PAGE> 11
- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
INSTRUCTIONS
Carefully complete the face portion of this Direction Form. Then insert
today's date and sign your name in the spaces provided below. Enclose the form
in the included postage prepaid envelope and mail it promptly. Your Direction
Form must be received no later than 5:00 p.m., Eastern Standard Time, on
Tuesday, November 29, 1994. Direction Forms that are not fully or properly
completed, dated, and signed, or that are received after the deadline, will be
ignored, and the shares allocated to your After-Tax Account will be held or
tendered, and if tendered, at a price, as determined by U.S. Trust Company of
California, N.A. Note that U.S. Trust also has the right to ignore any direction
that it determines cannot be implemented without violation of applicable law.
Neither the Corporation, its Board of Directors, Michigan National Bank as
Trustee, the Investment Committee, nor any other party makes any recommendation
to participants as to whether to tender shares, the price at which to tender, or
to refrain from tendering shares. Each participant must make his or her own
decision on these matters.
Date: , 1994
------- ----------------------------------------
Your Signature
(Please sign as your name appears below)
As of October 31, 1994, there were allocated to your After-Tax Account the
number of shares of Michigan National Corporation common stock shown to the
right of your address on the label below.
-----------------------------------------
-----------------------------------------
-----------------------------------------
-----------------------------------------
- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
<PAGE> 12
- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
MICHIGAN NATIONAL CORPORATION
DEFERRED COMPENSATION PLAN
DIRECTION FORM FOR ROLLOVER ACCOUNT
BEFORE COMPLETING THIS FORM, PLEASE READ CAREFULLY
THE ACCOMPANYING OFFER TO PURCHASE
See the Address Label on Reverse Side of This Form for the
Number of Shares Allocated to Your Rollover Account
In accordance with the Michigan National Corporation ("Corporation") Offer
to Purchase dated November 3, 1994, a copy of which I have received and read,
and pursuant to the pass-through provisions of the Michigan National Corporation
Deferred Compensation Plan ("Plan"), I hereby direct the Plan's Trustee,
Michigan National Bank, as follows (check only one box):
/ / 1. To refrain from tendering and to hold all shares allocated to my Rollover
Account.
/ / 2. To tender all shares allocated to my Rollover Account at the Purchase
Price determined by the Corporation.
/ / 3. To tender shares allocated to my Rollover Account at the price or prices
indicated below, except for any shares to be held as indicated on line E
below:
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------
PRICE $78.00 $78.25 $78.50 $78.75 $79.00 $79.25 $79.50 $79.75 $80.00 $80.25 $80.50 $80.75 ROW A TOTAL
------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
A NUMBER
OF
SHARES
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
PRICE $81.00 $81.25 $81.50 $81.75 $82.00 $82.25 $82.50 $82.75 $83.00 $83.25 $83.50 $83.75 ROW B TOTAL
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
------------------------------------------------------------------------------------------------------------------------------
B NUMBER
OF
SHARES
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
PRICE $84.00 $84.25 $84.50 $84.75 $85.00 $85.25 $85.50 $85.75 $86.00 $86.25 $86.50 $86.75 ROW C TOTAL
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
-----------------------------------------------------------------------------------------------------------------------------
C NUMBER
OF
SHARES
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
PRICE $87.00 $87.25 $87.50 $87.75 $88.00 $88.25 $88.50 $88.75 $89.00 $89.25 $89.50 $89.75 $90.00 ROW D TOTAL
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
----------------------------------------------------------------------------------------------------------------------------
D NUMBER
OF
SHARES
------------------------------------------------------------------------------------------------------------------------------
-------
SHARES
E TO BE
HELD
-- -- -- -- -- -- -- -- -- -- -- -- --
-------
-------
TOTAL
F SHARES
-- -- -- -- -- -- -- -- -- -- -- -- --
-------
</TABLE>
Total the number of shares in each of rows A to D and insert that total in
the box at the end of each row. Show shares to be held in the box at the end of
row E. Total the numbers in the end boxes of rows A to E and insert that total
number in the end box of row F. The total in the box of row F must equal the
number of shares allocated to your Rollover Account as shown on the address
label on the reverse side of this form.
- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
<PAGE> 13
- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
INSTRUCTIONS
Carefully complete the face portion of this Direction Form. Then insert
today's date and sign your name in the spaces provided below. Enclose the form
in the included postage prepaid envelope and mail it promptly. Your Direction
Form must be received no later than 5:00 p.m., Eastern Standard Time, on
Tuesday, November 29, 1994. Direction Forms that are not fully or properly
completed, dated, and signed, or that are received after the deadline, will be
ignored, and the shares allocated to your Rollover Account will be held or
tendered, and if tendered, at a price, as determined by U.S. Trust Company of
California, N.A. Note that U.S. Trust also has the right to ignore any direction
that it determines cannot be implemented without violation of applicable law.
Neither the Corporation, its Board of Directors, Michigan National Bank as
Trustee, the Investment Committee, nor any other party makes any recommendation
to participants as to whether to tender shares, the price at which to tender, or
to refrain from tendering shares. Each participant must make his or her own
decision on these matters.
Date: , 1994
------ ----------------------------------------
Your Signature
(Please sign as your name appears below)
As of October 31, 1994, there were allocated to your Rollover Account the number
of shares of Michigan National Corporation common stock shown to the right of
your address on the label below.
-----------------------------------------
-----------------------------------------
-----------------------------------------
-----------------------------------------
- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
<PAGE> 1
EXHIBIT 99.(a)(11)
[MNB Letterhead]
IMMEDIATE ATTENTION REQUIRED
November 3, 1994
RE: DIRECTION CONCERNING TENDER OF SHARES
DEAR ESOP PARTICIPANT:
Enclosed are materials that require your immediate attention. They describe
matters directly affecting your interest in the Michigan National Corporation
Employee Stock Ownership Plan (ESOP). Read all the materials carefully. You will
need to complete the enclosed Direction Form and return it in the postage paid
envelope provided. THE DEADLINE FOR RECEIPT OF YOUR COMPLETED DIRECTION FORM IS
5:00 P.M., EST, TUESDAY, NOVEMBER 29, 1994 (UNLESS EXTENDED). YOU SHOULD
COMPLETE THE FORM AND RETURN IT EVEN IF YOU DECIDE NOT TO PARTICIPATE IN THE
TRANSACTION DESCRIBED IN THE MATERIALS.
The remainder of this letter summarizes the transaction and your rights and
options under the ESOP, but you also should review the more detailed explanation
provided in the other materials.
BACKGROUND
As you no doubt have heard, Michigan National Corporation (Corporation) has
made a tender offer to purchase up to 1,858,650 million shares of its common
stock. The objectives of the purchase, and financial and other information
relating to the offer, are described in detail in the enclosed Offer to
Purchase, which is being provided to all shareholders of the Corporation.
As a participant in the ESOP, you are directly affected, because the
Corporation's Offer to Purchase extends to the approximately 1.1 million shares
of the Corporation's stock currently held by the ESOP. Only Michigan National
Bank, as Trustee of the ESOP, actually can tender these shares for sale.
However, as an ESOP participant, you have the right pursuant to the provisions
of the ESOP to direct the Trustee whether or not to tender the shares that are
allocated to your ESOP Account as of September 30, 1994. If you elect to have
the Trustee tender these shares, you also are entitled to specify the price or
prices at which they should be tendered.
To assure the confidentiality of your decision, the Corporation has
retained First Chicago Trust Company of New York (First Chicago) to tabulate the
directions of ESOP participants. You will note from the included envelope that
your Direction Form is to be returned to First Chicago. To further assure
confidentiality and independence of all actions, Michigan National Bank and the
ESOP's Committee also have hired U.S. Trust Company of California, N.A. (U.S.
Trust) to make all discretionary determinations. In particular, U.S. Trust will
decide whether to tender or hold shares of the ESOP that currently have not been
allocated to participants' Accounts. U.S. Trust also will decide the disposition
of shares that are allocated to Accounts of participants who fail to return
timely or complete directions. Finally, U.S. Trust will determine whether the
implementation of any participant directions or adherence to any ESOP provisions
would be a violation of the Employee Retirement Income Security Act of 1974
(ERISA). Although it is not anticipated that any direction will violate ERISA,
such that the direction would have to be reversed or ignored, the Department of
Labor requires that U.S. Trust, as the independent fiduciary for ESOP
participants, retain this discretion.
HOW THE OFFER TO PURCHASE WORKS
The details of the Offer to Purchase are described in the enclosed
materials, which you should review carefully. However, in broad outline, the
transaction will work as follows with respect to ESOP participants.
- The Corporation has offered to purchase up to 1,858,650 of its shares of
common stock at a price between $78 and $90 per share.
- If you want any of the shares that are allocated to your ESOP Account
sold, you need to direct that they be offered (or "tendered") for sale.
- You also need to specify the price at which you want the shares tendered.
That price must be between the two limits above. Alternatively, you have
the option to have your allocated shares tendered at whatever price is
finally determined to be the "Purchase Price," as explained below.
<PAGE> 2
- After the deadline for the tender of shares by all shareholders,
including the ESOP, First Chicago will tabulate all directions, and the
Corporation will determine the price, between the two limits, at which
the Corporation can purchase the number of shares that it wants. This is
referred to as the Purchase Price.
- Unless the offer is voided or discontinued in accordance with its terms,
the Corporation then will buy all the shares that were tendered at that
price or below. However, all sellers will receive the same Purchase
Price, even if they tendered below the Purchase Price.
- If you tender any shares at a price in excess of the Purchase Price as
finally determined, those shares will not be purchased, and they will
remain allocated to your ESOP Account.
This form of transaction is commonly called a "Dutch Auction" and requires
some strategy on your part. For example, if you are anxious to sell, you may
want to tender your shares at a price at or near the lower limit. If you are not
sure whether or not you want to participate, but would be willing to sell at a
price above the lower limit, then you may want to specify a higher price, not to
exceed the upper limit, of course.
If you do not want to sell under any circumstances, an option is provided
for you to direct that shares allocated to your ESOP Account be held. Similarly,
if you are sure that you want to sell and are willing to take any price not
below the lower limit of $78.00, then, as mentioned above, there is a separate
option provided for you under which all of your allocated shares will be
tendered at the Purchase Price.
Of course, U.S. Trust may override any direction that it determines is in
violation of ERISA, as previously described. In particular, the Corporation will
be prohibited from purchasing shares from the ESOP if the Purchase Price, as
finally determined, is less than the prevailing market price of the shares on
the date the shares are accepted for purchase. Finally, the Corporation will
prorate the number of shares purchased from shareholders if there is an excess
of shares over the exact number desired at the Purchase Price as ultimately
determined.
PROCEDURE FOR DIRECTING TRUSTEE
A Direction Form for making your direction is enclosed. You must complete
this form and return it in the included envelope in time to be received no later
than 5:00 p.m., EST, on Tuesday, November 29, 1994 (unless the Offer to Purchase
is extended or amended). If your form is not received by this deadline, or if it
is not fully and properly completed, the shares in your ESOP Account will be
tendered or held as decided by U.S. Trust.
To properly complete your Direction Form, you must do the following:
(1) On the face of the form, check Box 1, 2, or 3. CHECK ONLY ONE BOX.
Make your decision which box to check as follows:
- CHECK BOX 1 if you do not want the shares allocated to your Account
tendered for sale at any price and simply want the Trustee to continue
holding shares allocated to your Account.
- CHECK BOX 2 if you definitely want the Trustee to tender for sale all
of the shares allocated to your ESOP Account and are willing to accept
any price (not below $78 per share).
- CHECK BOX 3 in all other cases and complete lines A to F of the table
immediately below Box 3. (You should not complete the table if you
checked Box 1 or 2.) Use lines A to D to specify the number of shares
that you want to tender at each price indicated. Typically, you would
elect to have all of your shares tendered at a single price. However,
the form gives you the option of splitting your shares among several
prices. You must state the number of shares to be sold at each
indicated price by filling in the number of shares in the box
immediately below the price.
After you have specified your tender price or prices, you should total
the number of shares in each row A to D and insert the total of each
line in the box provided at the end of that line. Specify the number
of shares, if any, that you do not want tendered, but wish the Trustee
to hold, in the single box on line E.
Finally, total the shares in the end boxes of rows A to E and insert
the total in the box on line F. The total in this box must equal the
number of shares allocated to your ESOP Account as shown on the
address label on the reverse side of the Direction Form.
(2) Turn the Direction Form over, and date and sign it in the spaces
provided.
(3) Return the Direction Form in the included postage prepaid envelope
no later than 5:00 p.m., EST, on Tuesday, November 29, 1994 (unless this
deadline is extended). Be sure to return the form even if you decide not to
have the Trustee tender any shares.
2
<PAGE> 3
Your direction will be deemed irrevocable unless withdrawn by 5:00 p.m., EST, on
Tuesday, November 29, 1994 (unless the Offer to Purchase is extended or
amended). To be effective, a notice of withdrawal of your direction must be in
writing and must be received by First Chicago at the following address:
FIRST CHICAGO TRUST COMPANY OF NEW YORK
Suite 4660 MCN
P.O. Box 2560
Jersey City, NJ 07303
Facsimile Transmission (201) 222-4720
(201) 222-4721
Your notice must include your name, address, Social Security number, and the
number of shares allocated to your ESOP Account. Upon receipt of your notice by
First Chicago, your previous direction will be deemed cancelled. You may direct
the retendering of any shares in your Account by repeating the previous
instructions for directing the tendering set forth in this letter.
INVESTMENT OF TENDER PROCEEDS
For any ESOP shares that are tendered and purchased by the Corporation, the
Corporation will pay cash to the ESOP. U.S. Trust then will instruct the Trustee
whether to reinvest in shares of the Corporation's stock or in alternative
investments, being guided by the ESOP's terms and the trust agreement, and
subject to the limitations of ERISA.
Individual participants in the ESOP will not receive any portion of the
tender proceeds. All such proceeds and the assets will remain in the ESOP and
may be withdrawn only in accordance with the ESOP's terms. No gain or loss will
be recognized by participants in the ESOP for federal income tax purposes in
connection with the tender or sale of shares held in the ESOP.
NO RECOMMENDATION
THE CORPORATION'S BOARD OF DIRECTORS HAS UNANIMOUSLY APPROVED THE MAKING OF
THE OFFER TO PURCHASE. HOWEVER, NEITHER THE CORPORATION, ITS BOARD OF DIRECTORS,
MICHIGAN NATIONAL BANK AS TRUSTEE, THE COMMITTEE, OR ANY OTHER PARTY MAKES ANY
RECOMMENDATIONS TO PARTICIPANTS AS TO WHETHER TO TENDER SHARES, THE PRICE AT
WHICH TO TENDER, OR WHETHER TO REFRAIN FROM TENDERING SHARES. EACH PARTICIPANT
MUST MAKE HIS OR HER OWN DECISION ON THESE MATTERS.
CONFIDENTIALITY
AS MENTIONED ABOVE, BOTH FIRST CHICAGO AND U.S. TRUST HAVE BEEN RETAINED TO
HELP ASSURE THE CONFIDENTIALITY OF YOUR DECISION AS AN ESOP PARTICIPANT. YOUR
DECISION WILL NOT BE DISCLOSED TO ANY DIRECTORS, OFFICERS, OR EMPLOYEES OF
MICHIGAN NATIONAL CORPORATION OR MICHIGAN NATIONAL BANK, EXCEPT FOR THE PURPOSE
OF ALLOCATING PROCEEDS TO YOUR ESOP ACCOUNT IN THE EVENT THAT ALL OR A PORTION
OF YOUR SHARES ARE SOLD.
FURTHER INFORMATION
Although U.S. Trust also has no recommendation and cannot advise you what
to do, its representatives are prepared to answer any question that you may have
on the procedures involved in the Dutch Auction and your direction. U.S. Trust
also can help you complete your Direction Form.
For this purpose, you may contact U.S. Trust at the following toll-free
number between 11:00 a.m. and 8:00 p.m., EST, Monday through Friday:
U.S. TRUST
1-800-535-3093
Your ability to instruct the Trustee concerning whether or not to tender
shares allocated to your Account is an important part of your rights as an ESOP
participant. Please consider this letter and the enclosed materials carefully
and then return your Direction Form promptly.
Sincerely,
Committee for the Michigan National
Corporation
Employee Stock Ownership Plan
3
<PAGE> 4
- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
MICHIGAN NATIONAL CORPORATION
EMPLOYEE STOCK OWNERSHIP PLAN
DIRECTION FORM
BEFORE COMPLETING THIS FORM, PLEASE READ CAREFULLY
THE ACCOMPANYING OFFER TO PURCHASE
See the Address Label on Reverse Side of This Form for the
Number of Shares Allocated to Your Plan Account
In accordance with the Michigan National Corporation ("Corporation") Offer
to Purchase dated November 3, 1994, a copy of which I have received and read,
and pursuant to the pass-through provisions of the Michigan National Corporation
Employee Stock Ownership Plan ("Plan"), I hereby direct the Plan's Trustee,
Michigan National Bank, as follows (check only one box):
/ / 1. To refrain from tendering and to hold all shares allocated to my Account.
/ / 2. To tender all shares allocated to my Account at the Purchase Price
determined by the Corporation.
/ / 3. To tender shares allocated to my Account at the price or prices indicated
below, except for any shares to be held as indicated on line E below:
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------
PRICE $78.00 $78.25 $78.50 $78.75 $79.00 $79.25 $79.50 $79.75 $80.00 $80.25 $80.50 $80.75 ROW A TOTAL
------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
A NUMBER
OF
SHARES
-----------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------
<CAPTION>
PRICE $81.00 $81.25 $81.50 $81.75 $82.00 $82.25 $82.50 $82.75 $83.00 $83.25 $83.50 $83.75 ROW B TOTAL
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
-----------------------------------------------------------------------------------------------------------------------------
B NUMBER
OF
SHARES
-----------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------
<CAPTION>
PRICE $84.00 $84.25 $84.50 $84.75 $85.00 $85.25 $85.50 $85.75 $86.00 $86.25 $86.50 $86.75 ROW C TOTAL
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
-----------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------
C NUMBER
OF
SHARES
-----------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------
<CAPTION>
PRICE $87.00 $87.25 $87.50 $87.75 $88.00 $88.25 $88.50 $88.75 $89.00 $89.25 $89.50 $89.75 $90.00 ROW D TOTAL
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
-----------------------------------------------------------------------------------------------------------------------------
D NUMBER
OF
SHARES
-----------------------------------------------------------------------------------------------------------------------------
-------
SHARES
E TO BE
HELD
-- -- -- -- -- -- -- -- -- -- -- -- --
-------
-------
TOTAL
F SHARES
-- -- -- -- -- -- -- -- -- -- -- -- --
-------
</TABLE>
Total the number of shares in each of rows A to D and insert that total in
the box at the end of each row. Show shares to be held in the box at the end of
row E. Total the numbers in the end boxes of rows A to E and insert that total
number in the end box of row F. The total in the box of row F must equal the
number of shares allocated to your Account as shown on the address label on the
reverse side of this form.
- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- --
<PAGE> 5
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INSTRUCTIONS
Carefully complete the face portion of this Direction Form. Then insert
today's date and sign your name in the spaces provided below. Enclose the form
in the included postage prepaid envelope and mail it promptly. Your Direction
Form must be received no later than 5:00 p.m., Eastern Standard Time, on
Tuesday, November 29, 1994. Direction Forms that are not fully or properly
completed, dated, and signed, or that are received after the deadline, will be
ignored, and the shares allocated to your Account will be held or tendered, and
if tendered, at a price, as determined by U.S. Trust Company of California, N.A.
Note that U.S. Trust also has the right to ignore any direction that it
determines cannot be implemented without violation of applicable law.
Neither the Corporation, its Board of Directors, Michigan National Bank as
Trustee, the Committee, nor any other party makes any recommendation to
participants as to whether to tender shares, the price at which to tender, or to
refrain from tendering shares. Each participant must make his or her own
decision on these matters.
Date: , 1994
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Your Signature
(Please sign as your name appears below)
As of September 30, 1994, there were allocated to your Account the number of
shares of Michigan National Corporation common stock shown to the right of your
address on the label below.
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<PAGE> 1
EXHIBIT 99.(c)(1)
MICHIGAN NATIONAL CORPORATION
DEALER MANAGER AGREEMENT
November 3, 1994
KEEFE, BRUYETTE & WOODS, INC.
Two World Trade Center
New York, NY 10048
CS FIRST BOSTON CORPORATION
Park Avenue Plaza
55 East 52nd Street
New York, New York 10055
Dear Sirs:
1. Michigan National Corporation, a Michigan corporation
(the "Company"), plans to make a tender offer (the "Offer") to purchase up to
1,858,650 shares (or such lesser number of shares as are validly tendered) of
the Company's common stock, par value $10 per share (the "Shares") (including
the associated preferred share purchase rights), on the terms and subject to
the conditions set forth in the Offer to Purchase dated November 3, 1994 (such
Offer to Purchase, as the same may be amended or supplemented from time to
time, the "Offer to Purchase"), and in the related Letter of Transmittal (such
Letter of Transmittal, as the same may be amended or supplemented from time to
time, the "Letter of Transmittal") attached hereto as Exhibits A and B,
respectively. The Offer to Purchase and the Letter of Transmittal and any
amendment or supplement thereto shall constitute the "Offer." The Offer is not
being made to holders of the Cancellable Mandatory Stock Purchase Contracts
(the "Stock Purchase Contracts") issued by the Company in conjunction with
issuance of the Company's Subordinated Debentures due November 10, 1998. The
Company plans to make a separate offer (the "Contract Offer") to purchase for
cash any or all of the Stock Purchase Contracts at a purchase price of $21.625
per Stock Purchase Contract simultaneously with the Offer on the terms and
subject to the conditions set forth in the Contract Offer to Purchase dated
November 3, 1994 (such Contract Offer to Purchase, as the same may be amended
or supplemented from time to time, the "Contract Offer to Purchase"), and in
the related Contract Offer Letter of Transmittal (such Contract Offer Letter of
Transmittal, as the same may be amended or supplemented from time to time,
<PAGE> 2
the "Contract Offer Letter of Transmittal") attached hereto as Exhibits C and
D, respectively.
2. The Company hereby appoints each of you as Co-Dealer
Managers in connection with the Offer and the Contract Offer (each a "Dealer
Manager" and together, the "Dealer Managers") and authorizes you to act as such
in connection with the Offer and the Contract Offer. As Co-Dealer Managers,
you agree, in accordance with your customary practice, to perform those
services in connection with the Offer and the Contract Offer as are customarily
performed by investment banking concerns in connection with self tender offers
of like nature. All references herein to "you" and "yours" shall mean each of
you, severally, and not jointly.
3. You shall have no liability (whether direct or
indirect, in tort, contract or otherwise) to the Company or any other person
for any losses, claims, damages, liabilities or expenses related to or arising
from your own acts or omissions in performing your obligations hereunder,
except for any such losses, claims, damages, liabilities or expenses
attributable to your gross negligence or bad faith. In connection with the
Offer and the Contract Offer, no broker or dealer in securities, bank or trust
company is to be deemed to be acting as your agent and you shall act as an
independent contractor. Nothing herein contained shall constitute you an agent
of the Company or the Company an agent of you.
4. The Company shall furnish you, at its sole expense,
with as many copies as you may reasonably request of the Offer to Purchase, the
Letter of Transmittal, the Contract Offer to Purchase, the Contract Letter of
Transmittal and any amendments or supplements thereto and any other materials
publicly filed by the Company relating to the Offer and the Contract Offer
(collectively, as amended or supplemented from time to time, the "Tender Offer
Material"). The Company agrees that, at a reasonable time prior to using any
Tender Offer Material or filing any such Tender Offer Material with the
Securities and Exchange Commission (the "Commission"), it will submit copies of
such Tender Offer Material to you and will give reasonable consideration to
your and your counsel's comments, if any, thereon. If (i) the Company uses or
permits the use of any Tender Offer Material or files any such material with
the Commission (A) in contravention of the foregoing sentence or (B) which has
been submitted to you for your comments and with respect to which you have made
comments which have been communicated to the Company, but which comments have
not resulted in a
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response reasonably satisfactory to you and your counsel, (ii) any restraining
order or other injunctive order shall have been issued or any action, suit or
proceeding shall have been commenced with respect to the Offer, the Contract
Offer or with respect to any of the transactions in connection with, or
contemplated by, the Offer, the Contract Offer or this Agreement before any
court or governmental agency or other regulatory body or administrative
authority which you, in good faith after consultation with the Company,
reasonably believe makes it legally inadvisable for you to continue to act
hereunder, (iii) the Company shall be in violation, in any material respect, of
any of its representations, warranties or agreements hereunder or (iv) your
continuing to act as a Dealer Manager would in your reasonable judgment violate
any applicable statute, regulation or other law of the United States or any
state or other political subdivision thereof, then you shall be entitled to
withdraw as a Dealer Manager in connection with the Offer or the Contract Offer
without any liability or penalty to you or any other Indemnified Person (as
defined in Section 12) and without loss of any right to the payment of all fees
and expenses payable hereunder which have accrued to the date of such
withdrawal. If you withdraw as a Dealer Manager, the fees accrued and
reimbursement for your expenses through the date of such withdrawal shall be
paid to you promptly after such date.
5. As compensation for your services as Dealer Managers
of the Offer and the Contract Offer, the Company agrees to pay you an aggregate
dealer manager fee equal to (i) $.10 per Share purchased by the Company
pursuant to the Offer and (ii) $.10 per Stock Purchase Contract, such fees to
be shared equally by the Dealer Managers and to be payable in cash concurrently
with the payment for Shares and Stock Purchase Contracts purchased by the
Company upon consummation of the Offer and/or the Contract Offer, as the case
may be.
6. In addition to your compensation for your services as
Dealer Managers, the Company agrees to pay (i) all fees and expenses relating
to the preparation, filing, printing, mailing and publishing of the Tender
Offer Materials, (ii) all fees and expenses of the Depositary and Information
Agent (as hereinafter defined), (iii) all advertising charges, if any, provided
that such charges are approved in advance by the Company, (iv) the preparation
and distribution of this Agreement and (v) all other fees and expenses in
connection with the Offer and the Contract Offer, including, if applicable,
those of any soliciting agent, information agent or other person rendering
services in
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connection therewith, provided that any such persons are approved in advance by
the Company. The Company will also reimburse you promptly for all reasonable
out-of-pocket expenses incurred by you in connection with your services as
Dealer Managers, including the reasonable fees, costs and out-of-pocket
expenses of your legal counsel. All payments to be made by the Company
pursuant to this Section 6 (including those payable if you withdraw as a Dealer
Manager in accordance with the terms of Section 4 or 11 of this Agreement)
shall be made promptly after the expiration or termination of the Offer or the
Contract Offer. The Company shall perform its obligations set forth in this
Section 6, in Section 5, and in Section 12 whether or not the Offer or the
Contract Offer is commenced or the Company acquires any Shares or the Stock
Purchase Contract pursuant to the Offer or the Contract Offer, respectively.
7. The Company will arrange for First Chicago Trust
Company of New York and Georgeson & Company Inc., respectively, or such other
persons as are satisfactory to you and the Company to serve as depositary (the
"Depositary") and information agent (the "Information Agent") in connection
with the Offer and the Contract Offer and, as such, to advise you at least
daily as to such matters relating to the Offer and the Contract Offer as you
may reasonably request.
8. The Company represents and warrants to, and agrees
with you, that:
(a) the Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the State
of Michigan, has the corporate power and authority to own its
properties and conduct its business as described in the Offer to
Purchase and the Contract Offer to Purchase and is duly qualified to
transact business and is in good standing in each jurisdiction in
which the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that the
failure to be so qualified or be in good standing would not have a
material adverse effect on the Company and its subsidiaries, taken as
a whole;
(b) each of Michigan National Bank and Independence One
Bank of California and any other Significant Subsidiary (as defined in
Section 1-02 in Regulation S-X promulgated by the Commission under the
Securities Exchange Act of 1934, as amended (the "1934 Act")) referred
to herein collectively as the ("Material
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Subsidiaries") has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its
property and to conduct its business as described in the Offer to
Purchase and the Contract Offer to Purchase and is duly qualified to
transact business and is in good standing in each jurisdiction in
which the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that the
failure to be so qualified or be in good standing would not have a
material adverse effect on the Company and its subsidiaries, taken as
a whole; all of the issued and outstanding capital stock of each
Material Subsidiary has been duly authorized and validly issued, is
fully paid and non-assessable and (except for directors' qualifying
shares) is owned by the Company, directly or through Material
Subsidiaries, free and clear of any security interest, mortgage,
pledge, lien, encumbrance or claim;
(c) it has taken all necessary corporate action to
authorize the Offer and the Contract Offer, the purchase of the Shares
and the Stock Purchase Contracts pursuant to the Offer and the
Contract Offer and all other actions contemplated in the Tender Offer
Materials and the use by the Company of the funds needed in connection
therewith and the Company has taken or will take all necessary
corporate action to authorize any amendments to, or modifications of,
the Offer and the Contract Offer;
(d) this Agreement has been duly authorized, executed and
delivered by the Company and is a valid and binding agreement of the
Company except as rights to indemnification hereunder may be limited
by applicable state and federal securities laws;
(e) (i) upon commencement of the Offer and the Contract Offer,
the Company will duly file with the Commission an Issuer Tender Offer
Statement on Schedule 13E-4 (the "Statement") pursuant to Rule 13e-4
promulgated by the Commission under the 1934 Act, a copy of which
Statement, including the documents required by Item 9 thereof to be
filed as exhibits thereto (the "Exhibits"), in the form in which the
Statement and such Exhibits has been or will be furnished to you; (ii)
any amendments to the Statement and the final form of all such
Exhibits filed with the Commission or published,
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<PAGE> 6
sent or given to holders of Shares will be furnished to you prior to
any such amendment, filing, publication or distribution; (iii) the
Statement as so filed and as amended from time to time will comply in
all material respects with the provisions of the 1934 Act and the
rules and regulations thereunder; and (iv) neither the Statement as
filed or as amended from time to time nor any other Tender Offer
Material as filed or as amended or supplemented from time to time will
contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements made therein,
in light of the circumstances under which they are made, not
misleading, except that the Company makes no representation or
warranty with respect to any statement contained in, or any omission
from, any Tender Offer Material based upon information concerning you
and furnished in writing by you to the Company expressly for use
therein;
(f) except as disclosed in the Offer to Purchase, the
Contract Offer to Purchase, the Offer and the Contract Offer, the
purchase of Shares pursuant to the Offer and the purchase of Stock
Purchase Contracts pursuant to the Contract Offer and the execution
and delivery of, and the consummation of the transactions contemplated
in, this Agreement will comply with all applicable requirements of
law, including any applicable regulation of any governmental agency,
authority or instrumentality, and, except as disclosed in the Offer to
Purchase and the Contract Offer to Purchase, no consent,
authorization, approval, order, exemption or other action of, or
filing with, any governmental agency, authority or instrumentality of
the United States or any jurisdiction therein or any other
jurisdiction is required in connection with the Offer or the Contract
Offer except such filings as may be required under the 1934 Act, any
applicable stock exchange rules or "Blue Sky" laws of any states of
the United States in connection with the solicitation of tenders of
Shares or Stock Purchase Contracts;
(g) except as disclosed in the Offer to Purchase and the
Contract Offer to Purchase, the making or consummation of the Offer
and the Contract Offer, the purchase of Shares pursuant to the Offer
and the purchase of Stock Purchase Contracts pursuant to the Contract
Offer and the execution and delivery of, and the consummation of the
transactions contemplated in, this Agreement will not (i) conflict
with, result in a
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<PAGE> 7
breach of or constitute a default under, the certificate of
incorporation or by-laws of the Company, or any material loan or
credit agreement, indenture, mortgage, note or other agreement or
instrument to which the Company or any of its subsidiaries is a party
or by which any of them or any of their respective properties or
assets is or may be bound or (ii) violate any order, judgment or
decree of any court or governmental agency, authority or
instrumentality of the United States, or any jurisdiction therein
applicable to the Company or any of its subsidiaries;
(h) in connection with the Offer and the Contract Offer,
the Company has complied, and will continue to comply, in all material
respects with the 1934 Act and the rules and regulations promulgated
thereunder;
(i) the Company is not, and will not become as a result
of the consummation of the Offer or the Contract Offer, an investment
company within the meaning of Investment Company Act of 1940, as
amended, and the rules and regulations promulgated thereunder;
(j) no restraining order has been issued which is
currently in effect and, except as set forth in the Tender Offer
Material, no investigation, proceeding or litigation has been
commenced or, to the knowledge of the Company, threatened before the
Commission or any federal, state, or local court or governmental
agency or authority, with respect to the making or consummation of the
Offer or the Contract Offer or the other transactions contemplated in
the Tender Offer Material or this Agreement; and
(k) the Company has no knowledge of any material fact or
information concerning the Company or any of its subsidiaries, or the
operations, assets, condition, financial or otherwise, or prospects of
the Company or any of its subsidiaries, which is required to be made
generally available to the public and which has not been, or is not
being, or will not be, made generally available to the public through
the Tender Offer Material or otherwise.
9. The Company will advise you promptly of (i) the occurrence
of any event which could cause the Company to withdraw or terminate the Offer
or the Contract Offer or would permit the Company to exercise any right not to
purchase Shares tendered thereunder, (ii) any proposal or
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<PAGE> 8
requirement to make, amend or supplement any Tender Offer Material, (iii) the
issuance or the threatened issuance of any order or the taking of any other
action by any administrative or judicial tribunal or other governmental agency
or instrumentality concerning the Offer or the Contract Offer (and, if in
writing, will furnish you a copy thereof) and (iv) any other information
relating to the Offer or the Contract Offer which may be from time to time
reasonably request.
10. The Company has delivered to you an opinion of
Wachtell, Lipton, Rosen & Katz, outside counsel to the Company, substantially
in the form of Exhibit E hereto and an opinion of Lawrence L. Gladchun, General
Counsel to the Company, substantially in the form of Exhibit F hereto.
11. Your obligation to act, or to continue to act (as the
case may be), as a Dealer Manager hereunder shall at all times be subject, at
your election, to continuing fulfillment of the following conditions:
(a) all representations, warranties and other statements
of the Company contained in this Agreement are now, and at all times
shall be, true and correct in all material respects; and
(b) the Company at all times shall have performed in all
material respects all of its obligations to be performed hereunder.
12. The Company will indemnify and hold harmless each
Dealer Manager and each such Dealer Manager's affiliated companies and any
director, officer, agent or employee of each Dealer Manager or any such
affiliated company and any director, officer or other person controlling
(within the meaning of Section 20(a) of the 1934 Act) each Dealer Manager
(including each Dealer Manager's affiliated companies) (collectively,
"Indemnified Persons") from and against any and all losses, claims, damages,
liabilities or expenses (whether direct or indirect, in contract, tort or
otherwise) whatsoever (as incurred or suffered and including, but not limited
to, any and all expenses, including the reasonable fees of counsel, incurred in
investigating, preparing or defending any litigation or proceeding, commenced
or threatened, or any claim whatsoever and whether or not such Dealer Manager
or any other Indemnified Person shall be a party thereto) (a) arising out of or
are based upon (i) any untrue statement or alleged untrue statement of any
material fact contained in any Tender Offer Material, or any document
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<PAGE> 9
related thereto, or arising out of or are 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 or (ii) any withdrawal
or termination by the Company of, or failure by the Company to make or
consummate, the Offer or the Contract Offer or failure by the Company to
purchase any Shares pursuant to the Offer or purchase Stock Purchase Contracts
pursuant to the Contract Offer or (iii) any breach by the Company of any
representation or warranty or failure to comply with any of the agreements
contained herein or (b) otherwise arising out of, relating to or in connection
with the services rendered by you under this Agreement, except in the case of
clause (b) above for any such loss, claim, damage, liability or expense which
is determined by final judgment of a court of competent jurisdiction to result
from your gross negligence or bad faith and except in the case of clauses
(a)(i) and (b) above for any such loss, claim, damage, liability or expense
which arises out of or is based upon (x) any untrue statement or alleged untrue
statement of a material fact contained in any Tender Offer Material or (y) any
omission or alleged omission to state in such Tender Offer Material a material
fact necessary in order to make the statements made therein, in light of the
circumstances on which they were made, not misleading, if in any such case such
statement or omission was made in reliance upon and in conformity with
information furnished in writing by you to the Company expressly for use
therein. The foregoing indemnity shall be in addition to any liability which
the Company might otherwise have to you and such other Indemnified Persons.
If a claim is made against any Indemnified Person as to which
such Indemnified Person may seek indemnity under this Section 12, such
Indemnified Person shall notify the Company promptly after any written
assertion of such claim threatening to institute an action or proceeding with
respect thereto and shall notify the Company within a reasonable time after
such Indemnified Person shall have been served with a summons or other first
legal process giving information as to the nature and basis of the claim.
Failure to so notify the Company shall not, however, relieve the Company from
any liability which it may have on account of the indemnity under this Section
12 if the Company has not been prejudiced in any material respect by such
failure. The Company shall have the right to participate at its own expense in
the defense of any such litigation or proceeding and the Company shall, upon
the request of such Indemnified Person, assume the defense of any such
litigation or proceeding, including the employment of counsel reasonably
satisfactory to such Indemnified Person
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and the payment of all fees and expenses of such counsel. In any such
litigation or proceeding the defense of which the Company shall have so
assumed, any Indemnified Person shall have the right to participate in such
litigation or proceeding and to retain its own counsel, but the fees and
expenses of such counsel shall be at the expense of such Indemnified Person
unless (i) the Company and the Indemnified Person shall have mutually agreed to
the retention of such counsel, (ii) the Company shall have failed to assume the
defense and employ counsel or (iii) the named parties to any such proceeding
(including any impleaded parties) include (x) either of the Company and (y) the
Indemnified Person, and the Indemnified Person shall have been advised by such
counsel that there may be one or more legal defenses available to it which are
different from or additional to those available to the Company; provided,
however, that the Company shall not in such event be responsible under this
Agreement for the fees and expenses of more than one firm of separate counsel
(in addition to any local counsel) for all such Indemnified Persons and that
all such fees and expenses shall be reimbursed as they are incurred. Such firm
shall be designated in writing by the Dealer Managers. The Company shall not
be liable for any settlement of any litigation or proceeding effected without
the prior written consent of the Company (which consent will not be
unreasonably withheld), but if settled with such consent or if there be a
final, unappealable judgment for the plaintiff, the Company agrees, subject to
the provision of this Section 12, to indemnify and hold harmless the
Indemnified Person from and against any loss, damage, liability or expense by
reason of such settlement or judgment. The Company agrees to notify each
Dealer Manager promptly of the assertion of any claim in connection with the
Offer or the Contract Offer against it, any of its officers, directors,
shareholders, subsidiaries or affiliates or any person who controls it, or with
which it is under common control, within the meaning of Section 20(a) of the
1934 Act.
If the indemnity provided for in the foregoing paragraphs of
this Section 12 is unavailable to an Indemnified Person in respect of any
losses, claims, damages, liabilities or expenses referred to therein (other
than for reasons specified in the first sentence of this Section 12 relating to
the gross negligence or bad faith of an Indemnified Person), then the Company
in lieu of indemnifying such Indemnified Person, agrees to contribute to the
amount paid or payable by such Indemnified Person as a result of such losses,
claims, damages, liabilities or expenses (i) in such proportion as is
appropriate to reflect the relative
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<PAGE> 11
benefits received by the Company on the one hand and by the Dealer Managers on
the other from the Offer and the Contract Offer or (ii) if the allocation
provided by the foregoing clause (i) is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in the foregoing clause (i), but also the relative fault of the
Company on the one hand and of the Dealer Managers on the other in connection
with the statements, actions or omissions which resulted in such losses,
claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and by the Dealer Managers on the other shall be deemed to be in the
same proportion as (i) the maximum aggregate value of the consideration
proposed to be paid by the Company for the purchase of Shares pursuant to the
Offer and for Share Purchase Contracts pursuant to the Contract Offer bears to
(ii) the maximum aggregate fee proposed to be paid to each Dealer Manager
pursuant to Section 5. The relative fault of the Company on the one hand and
of each Dealer Manager on the other (i) in the case of an untrue or alleged
untrue statement of a material fact or an omission or alleged omission to state
a material fact, shall be determined by reference to, among other things,
whether such statement or omission relates to information supplied by the
Company or by the Dealer Managers and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission and (ii) in the case of any other action or omission, shall be
determined by reference to, among other things, whether such action or omission
was taken or omitted to be taken by the Company or by the Dealer Managers and
the parties, relative intent, knowledge, access to information and opportunity
to prevent such action or omission.
The Company and each Dealer Manager agrees that it would not
be just and equitable if contribution pursuant to this Section 12 were
determined by pro rata allocation or by any other method of allocation which
does not take into account of the equitable considerations referred to in the
immediately preceding paragraph. The amount paid or payable by an Indemnified
Person as a result of the losses, claims, damages, liabilities or expenses
referred to in the immediately preceding paragraph shall be deemed to include,
subject to the limitations set forth above, any legal or other expenses
reasonably incurred by such Indemnified Person in connection with investigating
or defending any such action or claim.
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<PAGE> 12
If at any time an Indemnified Person shall have requested the
Company to reimburse such Indemnified Person for expenses, as contemplated by
this Section 12, with respect to any litigation, proceeding or claim for which
indemnity may be sought hereunder, the Company agrees that it shall be liable
for any settlement by one or more Indemnified Persons of such litigation,
proceeding or claim effected without the Company's consent if (i) such
settlement is entered into more than 30 days after receipt by the Company of
such request and (ii) the Company shall not have reimbursed all Indemnified
Persons in accordance with all such requests prior to the date of such
settlement. The Company agrees that, without your prior written consent, it
will not settle, compromise or consent to the entry of any judgment in any
pending or threatened claim, action or proceeding in respect of which
indemnification could be sought under the indemnification provisions hereof
(whether or not you or any other Dealer Manager is an actual or potential party
to such claim, action or proceeding), unless such settlement, compromise or
consent includes an unconditional release of such Indemnified Person from all
liability arising out of such claim, action or proceeding.
13. The indemnity and contribution agreements contained
in Section 12 and the representations and warranties of the Company set forth
in this agreement shall remain operative and in full force and effect
regardless of (i) any failure to commence, or the withdrawal, termination or
consummation of, the Offer or the Contract Offer or the termination or
assignment of this Agreement, (ii) any investigation made by or on behalf of
any Indemnified Person and (iii) any withdrawal by the Dealer Managers pursuant
to Section 4 or otherwise.
14. All notices and other communications hereunder will
be in writing and, if sent to you, will be mailed, delivered or telecopied and
confirmed to you.
CS First Boston Corporation,
Park Avenue Plaza
55 East 52nd Street
New York, New York 10055
Attention: Joseph D. Fashano
Facsimile: (212) 318-0532
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<PAGE> 13
Keefe, Bruyette & Woods, Inc.
Two World Trade Center, 85th Floor
New York, New York 10048
Attention: James M. Harasimowicz
Facsimile: (212) 775-0593
with a copy to:
White & Case
1155 Avenue of the Americas
New York, New York 10036
Attention: John M. Reiss, Esq.
Facsimile: 212-354-8113
or, if sent to the Company will be mailed delivered or telecopied and confirmed
to it at
Michigan National Corporation
27777 Inkster Road
Farmington Hills, Michigan 48334
Attention: Lawrence L. Gladchun, Esq.
Facsimile: (810) 473-3086
with a copy to:
Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, New York 10019
Attention: Edward D. Herlihy, Esq.
Facsimile: (212) 403-2000
15. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
officers and directors and controlling persons referred to in Section 12, and
no other person will have any right or obligation hereunder.
16. If any provision hereof shall be determined to be
invalid or unenforceable in any respect, such determination shall not affect
such provision in any other respect or any other provision hereof, which shall
remain in full force and effect.
17. This Agreement constitutes the entire agreement
between the parties hereto, and supersedes all prior agreements, understandings
and arrangements, oral or written, between the parties hereto, with respect to
the subject matter hereof.
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<PAGE> 14
18. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
19. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York (without regard to choice of
law doctrine).
If the foregoing is in accordance with your understanding of
our agreement, kindly sign and return to us one or the counterparts hereof,
whereupon it will become a binding agreement in accordance with its terms.
Very truly yours,
MICHIGAN NATIONAL CORPORATION
By:__________________________
Name:
Title:
The foregoing Dealer Manager
Agreement is hereby confirmed
and accepted as of the date
first above written.
KEEFE, BRUYETTE & WOODS, INC.
By:___________________________
Name:
Title:
CS FIRST BOSTON CORPORATION
By:___________________________
Name:
Title:
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