<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------
FORM 8-K
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
JULY 11, 1995
Date of Report (Date of earliest event reported)
NBD BANCORP, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 1-7127 38-1984850
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number identification No.)
611 WOODWARD AVENUE
DETROIT, MICHIGAN 48226
(Address of principal executive offices) (Zip Code)
Registrant's Telephone Number, including area code: (313) 225-1000
<PAGE>
ITEM 5. OTHER EVENTS
On July 11, 1995, NBD Bancorp, Inc., a Delaware corporation (the
"Company"), entered into an Agreement and Plan of Merger (the "Merger
Agreement") with First Chicago Corporation, a Delaware corporation ("FCC"),
pursuant to which FCC will merge with and into the Company (the "Merger"). As a
result of the Merger, the outstanding shares of FCC's common stock, par value
$5.00 per share ("FCC Common Stock"), will be converted into the right to
receive 1.81 shares of common stock of the Company, par value $1.00 per share
("Company Common Stock"), per share of FCC Common Stock converted (or cash in
lieu of fractional shares otherwise deliverable in respect thereof). The Merger
is conditioned upon, among other things, approval by holders of a majority of
the Company Common Stock, by holders of a majority of FCC Common Stock, and upon
receipt of certain regulatory and governmental approvals. The Merger Agreement
is attached as Exhibit 1 hereto and its terms are incorporated herein by
reference.
Simultaneously with their execution and delivery of the Merger
Agreement, the Company and FCC entered into stock option agreements (the "Stock
Option Agreements") pursuant to one of which the Company granted FCC the right,
upon the terms and subject to the conditions set forth therein, to purchase up
to 31,270,000 shares of Company Common Stock at a price of $32-1/2 per share,
and pursuant to the other of which FCC granted the Company the right, upon the
terms and subject to the conditions set forth therein, to purchase up to
17,854,000 shares of FCC Common Stock of a price of $60-1/8 per share. The
Stock Option Agreements are attached as Exhibits 2 and 3 hereto, respectively,
and their terms are incorporated herein by reference.
A copy of the Press Release, dated July 12, 1995, issued by the
Company and FCC relating to the Merger is attached as Exhibit 4 hereto and is
incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
1. Agreement and Plan of Merger dated as of July 11, 1995, by and
between First Chicago Corporation and NBD Bancorp, Inc.
2. Stock Option Agreement dated as of July 11, 1995, by and between
First Chicago Corporation (as "Issuer") and NBD Bancorp, Inc. (as
"Grantee").
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<PAGE>
3. Stock Option Agreement dated as of July 11, 1995, by and between
NBD Bancorp, Inc. (as "Issuer") and First Chicago Corporation (as
"Grantee").
4. Press Release, dated July 12, 1995, relating to transactions
between First Chicago Corporation and NBD Bancorp, Inc.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
NBD BANCORP, INC.
By: /s/ Daniel T. Lis
______________________________
Name: Daniel T. Lis
Title: Senior Vice President,
Secretary and Chief Legal
Officer
Date: July 19, 1995
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<PAGE>
EXHIBIT INDEX
Exhibit Sequential
No. Description Page Number
- ------- ----------- -----------
99.1 Agreement and Plan of Merger dated
as of July 11, 1995, by and between
First Chicago Corporation and NBD
Bancorp, Inc.
99.2 Stock Option Agreement dated as of
July 11, 1995, by and between First
Chicago Corporation (as "Issuer") and
NBD Bancorp, Inc. (as "Grantee")
99.3 Stock Option Agreement dated as of
July 11, 1995, by and between NBD
Bancorp, Inc. (as "Issuer") and First
Chicago Corporation (as "Grantee")
99.4 Press Release, dated July 12, 1995,
relating to transactions between
First Chicago Corporation and NBD
Bancorp, Inc.
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<PAGE>
EXHIBIT 99.1
AGREEMENT AND PLAN OF MERGER
between
FIRST CHICAGO CORPORATION
and
NBD BANCORP, INC.
----------------
DATED AS OF JULY 11, 1995
<PAGE>
TABLE OF CONTENTS
-----------------
Page
----
<TABLE>
<CAPTION>
AGREEMENT AND PLAN OF MERGER
ARTICLE I
THE MERGER
<C> <S> <C>
1.1 The Merger....................................... 1
1.2 Effective Time................................... 2
1.3 Effects of the Merger............................ 2
1.4 Conversion of First Chicago Common Stock; First
Chicago Preferred Stock.......................... 2
1.5 NBD Common Stock................................. 5
1.6 Options.......................................... 5
1.7 Certificate of Incorporation..................... 6
1.8 By-Laws.......................................... 6
1.9 Tax Consequences................................. 6
1.10 Management Succession............................ 6
1.11 Board of Directors............................... 6
1.12 Headquarters of Surviving Corporation............ 7
</TABLE>
<TABLE>
<CAPTION>
ARTICLE II
EXCHANGE OF SHARES
<S> <C> <C>
2.
2.1 NBD to Make Shares Available.................... 8
2.2 Exchange of Shares.............................. 8
</TABLE>
<TABLE>
<CAPTION>
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF NBD
<C> <S> <C>
3.
3.1 Corporate Organization..................... 11
3.2 Capitalization............................. 12
3.3 Authority; No Violation.................... 13
3.4 Consents and Approvals..................... 14
3.5 Reports.................................... 14
3.6 Financial Statements....................... 15
3.7 Broker's Fees.............................. 16
3.8 Absence of Certain Changes or Events....... 16
3.9 Legal Proceedings.......................... 17
</TABLE>
i
<PAGE>
<TABLE>
<C> <S> <C>
3.10 Taxes and Tax Returns...................... 17
3.11 Employees.................................. 19
3.12 SEC Reports................................ 20
3.13 Compliance with Applicable Law............. 21
3.14 Certain Contracts.......................... 21
3.15 Agreements with Regulatory Agencies........ 22
3.16 Other Activities of NBD and its
Subsidiaries............................... 22
3.17 Investment Securities...................... 23
3.18 Interest Rate Risk Management Instruments.. 23
3.19 Undisclosed Liabilities.................... 24
3.20 Environmental Liability.................... 24
3.21 State Takeover Laws........................ 24
3.22 Pooling of Interests....................... 24
</TABLE>
<TABLE>
<CAPTION>
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF FIRST CHICAGO
<C> <S> <C>
4.
4.1 Corporate Organization..................... 25
4.2 Capitalization............................. 25
4.3 Authority; No Violation.................... 27
4.4 Consents and Approvals..................... 28
4.5 Reports.................................... 29
4.6 Financial Statements....................... 29
4.7 Broker's Fees.............................. 30
4.8 Absence of Certain Changes or Events....... 30
4.9 Legal Proceedings.......................... 31
4.10 Taxes and Tax Returns...................... 31
4.11 Employees.................................. 33
4.12 SEC Reports................................ 34
4.13 Compliance with Applicable Law............. 35
4.14 Certain Contracts.......................... 35
4.15 Agreements with Regulatory Agencies........ 36
4.16 Other Activities of First Chicago and its
Subsidiaries............................... 37
4.17 Investment Securities...................... 37
4.18 Interest Rate Risk Management Instruments.. 38
4.19 Undisclosed Liabilities.................... 38
4.20 Environmental Liability.................... 38
4.21 State Takeover Laws........................ 39
4.22 Rights Agreement........................... 39
4.23 Pooling of Interests....................... 39
</TABLE>
ARTICLE V
COVENANTS RELATING TO CONDUCT
OF BUSINESS
ii
<PAGE>
<TABLE>
<S> <C>
5.
5.1 Conduct of Businesses Prior to the Effective
Time.............................................. 39
5.2 Forbearances........................................ 40
</TABLE>
<TABLE>
<CAPTION>
ARTICLE VI
ADDITIONAL AGREEMENTS
<C> <S> <C>
6.
6.1 Regulatory Matters......................... 42
6.2 Access to Information...................... 44
6.3 Stockholders' Approvals.................... 44
6.4 Legal Conditions to Merger................. 45
6.5 Affiliates; Publication of Combined
Financial Results.......................... 45
6.6 Stock Exchange Listing..................... 46
6.7 Employee Benefit Plans..................... 46
6.8 Indemnification; Directors' and Officers'
Insurance.................................. 47
6.9 Additional Agreements...................... 49
6.10 Advice of Changes.......................... 49
6.11 Dividends.................................. 49
</TABLE>
<TABLE>
<CAPTION>
ARTICLE VII
CONDITIONS PRECEDENT
<S> <C> <C>
7.
7.1 Conditions to Each Party's Obligation To
Effect the Merger......................... 49
7.2 Conditions to Obligations of First Chicago 51
7.3 Conditions to Obligations of NBD.......... 52
</TABLE>
<TABLE>
<CAPTION>
ARTICLE VIII
TERMINATION AND AMENDMENT
<C> <S> <C>
8.
8.1 Termination............................... 52
8.2 Effect of Termination..................... 53
8.3 Amendment................................. 54
8.4 Extension; Waiver......................... 54
</TABLE>
ARTICLE IX
iii
<PAGE>
GENERAL PROVISIONS
<TABLE>
<C> <S> <C>
9.
9.1 Closing..................................... 54
9.2 Nonsurvival of Representations, Warranties
and Agreements.............................. 55
9.3 Expenses.................................... 55
9.4 Notices..................................... 55
9.5 Interpretation.............................. 56
9.6 Counterparts................................ 56
9.7 Entire Agreement............................ 56
9.8 Governing Law............................... 56
9.9 Severability................................ 56
9.10 Publicity................................... 56
9.11 Assignment; Third Party Beneficiaries....... 57
</TABLE>
Exhibit A - First Chicago Option Agreement
Exhibit B - NBD Option Agreement
Exhibit 6.5(a)(1) - Form of Affiliate Letter Addressed
to NBD
Exhibit 6.5(a)(2) - Form of Affiliate Letter Addressed
to First Chicago
iv
<PAGE>
INDEX OF DEFINED TERMS
----------------------
<TABLE>
<S> <C>
BHC Act 11
CERCLA 24
Certificate 5
Certificate of Merger 2
Claim 48
Closing 54
Closing Date 54
Code 6
Common Certificate 4
Confidentiality Agreement 44
Delaware Secretary 2
DGCL 1
DPC Shares 4
Effective Time 2
ERISA 18
Exchange Act 15
Exchange Agent 7
Exchange Fund 8
Exchange Ratio 2
Federal Reserve Board 13
First Chicago 1
First Chicago Bank Subsidiary 36
First Chicago Benefit Plans 32
First Chicago Capital Stock 2
First Chicago Common Stock 2
First Chicago Contract 35
First Chicago Convertible Preferred Stock 25
First Chicago Disclosure Schedule 24
First Chicago DRIP 26
First Chicago ERISA Affiliate 32
First Chicago ESPSP 26
First Chicago 8.45% Series E Cumulative
Fixed Rate Preferred Stock 25
First Chicago March 31, 1995 Form 10-Q 29
First Chicago Option Agreement 1
First Chicago Preferred Stock 25
First Chicago Regulatory Agreement 36
First Chicago Reports 34
First Chicago Rights 26
First Chicago Rights Agreement 26
First Chicago Series A Cumulative
Adjustable Rate Preferred Stock 25
First Chicago Series B Cumulative
Adjustable Rate Preferred Stock 25
</TABLE>
v
<PAGE>
<TABLE>
<S> <C>
First Chicago Series C Cumulative
Adjustable Rate Preferred Stock 25
First Chicago Stock Plans 5
GAAP 15
Governmental Entity 14
HOLA 11
Indemnified Parties 46
Injunction 50
Insurance Amount 48
IRS 17
Joint Proxy Statement 13
Liens 12
LSARS 46
Material Adverse Effect 11
Merger 1
NBD 1
NBD Bank Subsidiary 22
NBD Benefit Plans 18
NBD Capital Stock 2
NBD Common Stock 2
NBD Contract 21
NBD Convertible Preferred Stock 3
NBD Disclosure Schedule 10
NBD 8.45% Series E Cumulative Fixed
Rate Preferred Stock 3
NBD ERISA Affiliate 18
NBD March 31, 1995 Form 10-Q 15
NBD New Preferred Stock 3
NBD Option Agreement 1
NBD Preferred Stock 11
NBD Regulatory Agreement 22
NBD Reports 20
NBD Series A Cumulative Adjustable Rate
Preferred Stock 2
NBD Series B Cumulative Adjustable Rate
Preferred Stock 3
NBD Series C Cumulative Adjustable Rate
Preferred Stock 3
NBD Stock Plans 46
NBD Units 11
New Benefit Plans 56
NYSE 9
OCC 14
Option Agreements 1
OTS 13
Preferred Stock Certificate 5
Regulatory Agencies 14
Requisite Regulatory Approvals 49
S-4 13
SBA 13
SEC 13
Securities Act 20
</TABLE>
vi
<PAGE>
<TABLE>
<S> <C>
Significant Subsidiary 22
SRO 14
State Approvals 13
State Regulator 14
Subsidiary 11
Surviving Corporation 1
Taxes 18
Trust Account Shares 4
Trust Activities 22
</TABLE>
vii
<PAGE>
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated as of July 11, 1995, by and
between FIRST CHICAGO CORPORATION, a Delaware corporation ("First Chicago") and
NBD BANCORP, INC., a Delaware corporation ("NBD").
WHEREAS, the Boards of Directors of NBD and First Chicago have
determined that it is in the best interests of their respective companies and
their stockholders to consummate the business combination transaction provided
for herein in which First Chicago will, subject to the terms and conditions set
forth herein, merge with and into NBD (the "Merger"), so that NBD is the
surviving corporation (hereinafter sometimes called the "Surviving Corporation")
in the Merger; and
WHEREAS, it is the intent of the respective Boards of Directors of
First Chicago and NBD that the Merger be structured as a "merger of equals" of
First Chicago and NBD and that the Surviving Corporation be governed and
operated on this basis; and
WHEREAS, as a condition to, and immediately after the execution of,
this Agreement, First Chicago and NBD are entering into a First Chicago stock
option agreement (the "First Chicago Option Agreement") attached hereto as
Exhibit A; and
WHEREAS, as a condition to, and immediately after the execution of,
this Agreement, First Chicago and NBD are entering into a NBD stock option
agreement (the "NBD Option Agreement"; and together with the First Chicago
Option Agreement, the "Option Agreements") attached hereto as Exhibit B; and
WHEREAS, the parties desire to make certain representations,
warranties and agreements in connection with the Merger and also to prescribe
certain conditions to the Merger.
NOW, THEREFORE, in consideration of the mutual covenants,
representations, warranties and agreements contained herein, and intending to be
legally bound hereby, the parties agree as follows:
ARTICLE I
THE MERGER
1.
1.1 The Merger. Subject to the terms and conditions of
<PAGE>
this Agreement, in accordance with the Delaware General Corporation Law (the
"DGCL"), at the Effective Time (as defined in Section 1.2), First Chicago shall
merge with and into NBD. NBD shall be the Surviving Corporation in the Merger,
and shall continue its corporate existence under the laws of the State of
Delaware. Upon consummation of the Merger, the separate corporate existence of
First Chicago shall terminate.
1.2 Effective Time. The Merger shall become effective as set forth in the
certificate of merger (the "Certificate of Merger") which shall be filed with
the Secretary of State of the State of Delaware (the "Delaware Secretary") on
the Closing Date (as defined in Section 9.1). The term "Effective Time" shall
be the date and time when the Merger becomes effective, as set forth in the
Certificate of Merger.
1.3 Effects of the Merger. At and after the Effective Time, the Merger
shall have the effects set forth in Section 261 of the DGCL.
1.4 Conversion of First Chicago Common Stock; First Chicago Preferred
Stock. At the Effective Time, in each case, subject to Section 2.2(e), by
virtue of the Merger and without any action on the part of First Chicago, NBD or
the holder of any of the following securities:
(a) Each share of the common stock, par value $5.00 per share, of First
Chicago (the "First Chicago Common Stock"; and together with the First Chicago
Preferred Stock (as defined in Section 4.2(a)), the "First Chicago Capital
Stock") issued and outstanding immediately prior to the Effective Time (other
than shares of First Chicago Capital Stock held (x) in First Chicago's treasury
or (y) directly or indirectly by First Chicago or NBD or any of their respective
wholly owned Subsidiaries (as defined in Section 3.1) (except for Trust Account
Shares and DPC shares, as such terms are defined in Section 1.4(i) and as set
forth in the First Chicago Disclosure Schedule)) shall be converted into the
right to receive 1.81 shares (the "Exchange Ratio") of the common stock, par
value $1.00 per share, of NBD (the "NBD Common Stock"; the NBD Common Stock, the
NBD Preferred Stock (as defined in Section 3.2) and the NBD New Preferred Stock
(as defined Section 1.4(f)) being referred to herein as the "NBD Capital
Stock").
(b) Each share of First Chicago Series A Cumulative Adjustable Rate
Preferred Stock (as defined in Section 4.2(a)) issued and outstanding
immediately prior to the Effective Time shall be converted into the right to
receive one share of preferred stock with cumulative and adjustable dividends of
NBD (the "NBD Series A Cumulative Adjustable Rate Preferred Stock"). The terms
of the NBD Series A Cumulative Adjustable Rate Preferred Stock shall be
substantially the same as the terms of
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<PAGE>
the First Chicago Series A Cumulative Adjustable Rate Preferred Stock.
(c) Each share of First Chicago Series B Cumulative Adjustable Rate
Preferred Stock (as defined in Section 4.2(a)) issued and outstanding
immediately prior to the Effective Time shall be converted into the right to
receive one share of preferred stock with cumulative and adjustable dividends of
NBD (the "NBD Series B Cumulative Adjustable Rate Preferred Stock"). The terms
of the NBD Series B Cumulative Adjustable Rate Preferred Stock shall be
substantially the same as the terms of the First Chicago Series B Cumulative
Adjustable Rate Preferred Stock.
(d) Each share of First Chicago Series C Cumulative Adjustable Rate
Preferred Stock (as defined in Section 4.2(a)) issued and outstanding
immediately prior to the Effective Time shall be converted into the right to
receive one share of preferred stock with cumulative and adjustable dividends of
NBD (the "NBD Series C Cumulative Adjustable Rate Preferred Stock"). The terms
of the NBD Series C Cumulative Adjustable Rate Preferred Stock shall be
substantially the same as the terms of the First Chicago Series C Cumulative
Adjustable Rate Preferred Stock.
(e) Each share of First Chicago 8.45% Series E Cumulative Fixed Rate
Preferred Stock (as defined in Section 4.2(a)) issued and outstanding
immediately prior to the Effective Time shall be converted into the right to
receive one share of preferred stock with a fixed rate dividend of NBD (the "NBD
8.45% Series E Cumulative Fixed Rate Preferred Stock"). The terms of the NBD
8.45% Series E Cumulative Fixed Rate Preferred Stock shall be substantially the
same as the terms of the First Chicago 8.45% Series E Cumulative Fixed Rate
Preferred Stock.
(f) Each share of First Chicago Convertible Preferred Stock (as defined in
Section 4.2(a)) issued and outstanding immediately prior to the Effective Time
shall be converted into the right to receive one share of convertible preferred
stock with a fixed rate dividend of NBD (the "NBD Convertible Preferred Stock",
and together with the NBD Series A Cumulative Adjustable Rate Preferred Stock,
NBD Series B Cumulative Adjustable Rate Preferred Stock, NBD Series C Cumulative
Adjustable Rate Preferred Stock, and NBD 8.45% Series E Cumulative Fixed Rate
Preferred Stock, the "NBD New Preferred Stock"). The terms of the NBD
Convertible Preferred Stock shall be substantially the same as the terms of the
First Chicago Convertible Preferred Stock.
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<PAGE>
(g) At the Effective Time, any deposit agreements pursuant to which shares
of First Chicago Preferred Stock are held subject to depositary receipts shall
automatically, and without further action on the part of the Surviving
Corporation, be assumed by the Surviving Corporation.
(h) All of the shares of First Chicago Common Stock converted into NBD
Common Stock pursuant to this Article I shall no longer be outstanding and shall
automatically be cancelled and shall cease to exist as of the Effective Time,
and each certificate (each a "Common Certificate") previously representing any
such shares of First Chicago Common Stock shall thereafter represent the right
to receive (i) a certificate representing the number of whole shares of NBD
Common Stock and (ii) cash in lieu of fractional shares into which the shares of
First Chicago Common Stock represented by such Common Certificate have been
converted pursuant to this Section 1.4 and Section 2.2(e). Common Certificates
previously representing shares of First Chicago Common Stock shall be exchanged
for certificates representing whole shares of NBD Common Stock and cash in lieu
of fractional shares issued in consideration therefor upon the surrender of such
Common Certificates in accordance with Section 2.2, without any interest
thereon. If, prior to the Effective Time, the outstanding shares of NBD Common
Stock or First Chicago Common Stock shall have been increased, decreased,
changed into or exchanged for a different number or kind of shares or securities
as a result of a reorganization, recapitalization, reclassification, stock
dividend, stock split, reverse stock split, or other similar change in
capitalization, then an appropriate and proportionate adjustment shall be made
to the Exchange Ratio.
(i) At the Effective Time, all shares of First Chicago Common Stock that
are owned by First Chicago as treasury stock and all shares of First Chicago
Common Stock that are owned, directly or indirectly, by First Chicago or NBD or
any of their respective wholly owned Subsidiaries (other than shares of First
Chicago Common Stock held, directly or indirectly, in trust accounts, managed
accounts and the like or otherwise held in a fiduciary capacity that are
beneficially owned by third parties (any such shares, and shares of NBD Common
Stock which are similarly held, whether held directly or indirectly by First
Chicago or NBD, as the case may be, being referred to herein as "Trust Account
Shares") and other than any shares of First Chicago Common Stock held by First
Chicago or NBD or any of their respective Subsidiaries in respect of a debt
previously contracted (any such shares of First Chicago Common Stock, and shares
of NBD Common Stock which are similarly held, whether held directly or
indirectly by First Chicago or NBD or any of their respective Subsidiaries,
being referred to herein as "DPC Shares") and as set forth in the First Chicago
Disclosure Schedule) shall be cancelled and shall cease to exist and no
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<PAGE>
stock of NBD or other consideration shall be delivered in exchange therefor. All
shares of NBD Common Stock that are owned by First Chicago or any of its wholly
owned Subsidiaries (other than Trust Account Shares and DPC Shares) shall become
treasury stock of NBD.
(j) All of the shares of First Chicago Preferred Stock converted into NBD
New Preferred Stock pursuant to this Article I shall no longer be outstanding
and shall automatically be cancelled and shall cease to exist as of the
Effective Time, and each certificate (each a "Preferred Stock Certificate"; and
together with a Common Certificate, a "Certificate") previously representing any
such shares of First Chicago Preferred Stock shall thereafter represent the
right to receive a certificate representing the number of whole shares of
corresponding NBD New Preferred Stock into which the shares of First Chicago
Preferred Stock represented by such Preferred Stock Certificate have been
converted pursuant to this Section 1.4. Preferred Stock Certificates previously
representing shares of First Chicago Preferred Stock shall be exchanged for
certificates representing whole shares of corresponding NBD New Preferred Stock
issued in consideration therefor upon the surrender of such Preferred Stock
Certificates in accordance with Section 2.2 hereof, without any interest
thereon.
1.5 NBD Common Stock. At and after the Effective Time, each share of NBD
Common Stock issued and outstanding immediately prior to the Closing Date shall
remain an issued and outstanding share of common stock of the Surviving
Corporation and shall not be affected by the Merger.
1.6 Options. (a) At the Effective Time, each option granted by First
Chicago to purchase shares of First Chicago Common Stock which is outstanding
and unexercised immediately prior thereto shall cease to represent a right to
acquire shares of First Chicago Common Stock and shall be converted
automatically into an option to purchase shares of NBD Common Stock in an amount
and at an exercise price determined as provided below (and otherwise, in the
case of options, subject to the terms of the First Chicago benefit plans under
which they were issued (collectively, the "First Chicago Stock Plans") and the
agreements evidencing grants thereunder)):
(i) The number of shares of NBD Common Stock to be subject to the new
option shall be equal to the product of the number of shares of First Chicago
Common Stock subject to the original option and the Exchange Ratio, provided
--------
that any fractional shares of NBD Common Stock resulting from such
multiplication shall be rounded to the nearest
-5-
<PAGE>
whole share; and
(ii) The exercise price per share of NBD Common Stock under the new option
shall be equal to the exercise price per share of First Chicago Common Stock
under the original option divided by the Exchange Ratio, provided that such
--------
exercise price shall be rounded down to the nearest whole cent.
(b) The adjustment provided herein with respect to any options which are
"incentive stock options" (as defined in Section 422 of the Internal Revenue
Code of 1986, as amended (the "Code")) shall be and is intended to be effected
in a manner which is consistent with Section 424(a) of the Code. The duration
and other terms of the new option shall be the same as the original option
except that all references to First Chicago shall be deemed to be references to
NBD.
1.7 Certificate of Incorporation. Subject to the terms and conditions of
this Agreement, at the Effective Time, the Certificate of Incorporation of NBD
shall be the Certificate of Incorporation of the Surviving Corporation until
thereafter amended in accordance with applicable law, except that such
Certificate of Incorporation shall be amended to provide: (a) that the number
of shares of authorized Common Stock of the Surviving Corporation shall be
increased to 1,000,000,000; (b) that the name of the Surviving Corporation shall
be "First Chicago NBD Corporation"; (c) for the deletion of the Series A
Preferred Stock, par value $1.00 per share; and (d) for the NBD New Preferred
Stock.
1.8 By-Laws. Subject to the terms and conditions of this Agreement, at
the Effective Time, the By-Laws of NBD, shall be the By-Laws of the Surviving
Corporation until thereafter amended in accordance with applicable law.
1.9 Tax Consequences. It is intended that the Merger shall constitute a
reorganization within the meaning of Section 368(a)(i)(A) of the Code, and that
this Agreement shall constitute a "plan of reorganization" for the purposes of
Section 368 of the Code.
1.10 Management Succession. (a) At the Effective Time, Mr. Richard L.
Thomas shall be Chairman of the Board of the Surviving Corporation, and shall
serve in such capacity until the annual meeting of stockholders of the Surviving
Corporation (anticipated to be held on May 20, 1996). At the Effective Time,
Mr. Verne G. Istock shall be the President and Chief Executive Officer of the
Surviving Corporation. Mr. Istock shall immediately and without further action
of the Board of Directors become Chairman of the Board of the Surviving
Corporation on the date (which in no event shall be later than
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<PAGE>
May 31, 1996) upon which Mr. Thomas ceases to be Chairman of the Board.
(b) At the annual meeting of stockholders of the Surviving Corporation
(anticipated to be held on May 20, 1996), Mr. Thomas shall retire from all
positions he then holds as an officer of the Surviving Corporation or as an
officer or employee of any of its Subsidiaries.
1.11 Board of Directors. (a) From and after the Effective Time, the
Board of Directors of the Surviving Corporation shall consist of 22 persons,
including Messrs. Thomas and Istock, 10 additional persons, two of whom may be
executive officers of First Chicago, to be named by Mr. Thomas and the Board of
Directors of First Chicago, and 10 additional persons, one of whom may be an
executive officer of NBD, to be named by Mr. Istock and the Board of Directors
of NBD.
(b) The representatives selected by First Chicago and NBD, respectively,
shall be divided as equally as practicable among the three classes of directors
in proportion to the aggregate representation set forth above. From and after
the Effective Time, the representatives of First Chicago and NBD shall also be
represented in proportion to the aggregate representation set forth above on all
committees of the Board of Directors of the Surviving Corporation.
1.12 Headquarters of Surviving Corporation. At the Effective Time, the
headquarters and principal executive offices of the Surviving Corporation shall
be Chicago, Illinois.
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<PAGE>
ARTICLE II
EXCHANGE OF SHARES
2.
2.1 NBD to Make Shares Available. At or prior to the Effective Time, NBD
shall deposit, or shall cause to be deposited, with First Chicago Trust Company
of New York, or another bank or trust company reasonably acceptable to each of
First Chicago and NBD (the "Exchange Agent"), for the benefit of the holders of
Certificates, for exchange in accordance with this Article II, certificates
representing the shares of NBD Common Stock and NBD New Preferred Stock and cash
in lieu of any fractional shares (such cash and certificates for shares of NBD
Common Stock and NBD New Preferred Stock, together with any dividends or
distributions with respect thereto, being hereinafter referred to as the
"Exchange Fund") to be issued pursuant to Section 1.4 and paid pursuant to
Section 2.2(a) in exchange for outstanding shares of First Chicago Common Stock.
2.2 Exchange of Shares. (a) As soon as practicable after the Effective
Time, and in no event later than five business days thereafter, the Exchange
Agent shall mail to each holder of record of one or more Certificates a letter
of transmittal (which shall specify that delivery shall be effected, and risk of
loss and title to the Certificates shall pass, only upon delivery of the
Certificates to the Exchange Agent) and instructions for use in effecting the
surrender of the Certificates in exchange for certificates representing, the
shares of NBD Common Stock, NBD New Preferred Stock and any cash in lieu of
fractional shares into which the shares of First Chicago Common Stock or First
Chicago Preferred Stock represented by such Certificate or Certificates shall
have been converted pursuant to this Agreement. Upon proper surrender of a
Certificate for exchange and cancellation to the Exchange Agent, together with
such properly completed letter of transmittal, duly executed, the holder of such
Certificate shall be entitled to receive in exchange therefor, as applicable,
(i) a certificate representing that number of whole shares of NBD Common Stock
or NBD New Preferred Stock to which such holder of First Chicago Common Stock or
First Chicago Preferred Stock shall have become entitled pursuant to the
provisions of Article I, and (ii) a check representing the amount of any cash in
lieu of fractional shares which such holder has the right to receive in respect
of the Certificate surrendered pursuant to the provisions of this Article II,
and the Certificate so surrendered shall forthwith be cancelled. No interest
will be paid or accrued on any cash in lieu of fractional shares or on any
unpaid dividends and distributions payable to holders of Certificates.
(b) No dividends or other distributions declared with respect to NBD
Common Stock or NBD New Preferred Stock with a
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<PAGE>
record date following the 30th day to occur after the Effective Time shall be
paid to the holder of any unsurrendered Certificate until the holder thereof
shall surrender such Certificate in accordance with this Article II. Subject to
Section 6.11 and to the effect of applicable laws, (i) until such 30th day,
there shall be paid to each former holder of shares of First Chicago Common
Stock or First Chicago Preferred Stock, the amount of dividends or other
distributions with a record date after the Effective Time but on or before such
30th day payable with respect to the shares of NBD Common Stock or NBD New
Preferred into which such First Chicago Common Stock or First Chicago Preferred
Stock has been converted pursuant to this Article II and (ii) after the
surrender of a Certificate in accordance with this Article II, the record holder
thereof shall be entitled to receive any such dividends or other distributions
with a record date following the 30th day to occur after the Effective Time,
without any interest thereon, which theretofore had become payable with respect
to shares of NBD Common Stock or NBD New Preferred Stock represented by such
Certificate.
(c) If any certificate representing shares of NBD Common Stock or NBD New
Preferred Stock is to be issued in a name other than that in which the
Certificate surrendered in exchange therefor is registered, it shall be a
condition of the issuance thereof that the Certificate so surrendered shall be
properly endorsed (or accompanied by an appropriate instrument of transfer) and
otherwise in proper form for transfer, and that the person requesting such
exchange shall pay to the Exchange Agent in advance any transfer or other taxes
required by reason of the issuance of a certificate representing shares of NBD
Common Stock or NBD New Preferred Stock in any name other than that of the
registered holder of the Certificate surrendered, or required for any other
reason, or shall establish to the satisfaction of the Exchange Agent that such
tax has been paid or is not payable.
(d) After the Effective Time, there shall be no transfers on the stock
transfer books of First Chicago of the shares of First Chicago Common Stock or
First Chicago Preferred Stock which were issued and outstanding immediately
prior to the Effective Time. If, after the Effective Time, Certificates
representing such shares are presented for transfer to the Exchange Agent, they
shall be cancelled and exchanged for certificates representing shares of NBD
Common Stock or NBD New Preferred Stock as provided in this Article II.
(e) Notwithstanding anything to the contrary contained herein, no
certificates or scrip representing fractional shares of NBD Common Stock shall
be issued upon the surrender for ex-
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<PAGE>
change of Certificates, no dividend or distribution with respect to NBD Common
Stock shall be payable on or with respect to any fractional share, and such
fractional share interests shall not entitle the owner thereof to vote or to any
other rights of a stockholder of First Chicago. In lieu of the issuance of any
such fractional share, NBD shall pay to each former stockholder of First Chicago
who otherwise would be entitled to receive such fractional share an amount in
cash determined by multiplying (i) the average of the closing-sale prices of NBD
Common Stock on the New York Stock Exchange, Inc. (the "NYSE") as reported by
The Wall Street Journal for the five trading days immediately preceding the date
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of the Effective Time by (ii) the fraction of a share (rounded to the nearest
thousandth when expressed as an Arabic number) of NBD Common Stock to which such
holder would otherwise be entitled to receive pursuant to Section 1.4.
(f) Any portion of the Exchange Fund that remains unclaimed by the
stockholders of First Chicago for 12 months after the Effective Time shall be
paid to NBD. Any stockholders of First Chicago who have not theretofore
complied with this Article II shall thereafter look only to NBD for payment of
the shares of NBD Common Stock or NBD New Preferred Stock, cash in lieu of any
fractional shares and any unpaid dividends and distributions on the NBD Common
Stock or NBD New Preferred Stock deliverable in respect of each share of First
Chicago Common Stock or First Chicago Preferred Stock, as the case may be, such
stockholder holds as determined pursuant to this Agreement, in each case,
without any interest thereon. Notwithstanding the foregoing, none of First
Chicago, NBD, the Exchange Agent or any other person shall be liable to any
former holder of shares of First Chicago Common Stock or First Chicago Preferred
Stock for any amount delivered in good faith to a public official pursuant to
applicable abandoned property, escheat or similar laws.
(g) In the event any Certificate shall have been lost, stolen or
destroyed, upon the making of an affidavit of that fact by the person claiming
such Certificate to be lost, stolen or destroyed and, if reasonably required by
NBD, the posting by such person of a bond in such amount as NBD may determine is
reasonably necessary as indemnity against any claim that may be made against it
with respect to such Certificate, the Exchange Agent will issue in exchange for
such lost, stolen or destroyed Certificate the shares of NBD Capital Stock and
any cash in lieu of fractional shares deliverable in respect thereof pursuant to
this Agreement.
3.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF NBD
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<PAGE>
Except as disclosed in the NBD disclosure schedule delivered to First
Chicago concurrently herewith (the "NBD Disclosure Schedule") NBD hereby
represents and warrants to First Chicago as follows:
3.1 Corporate Organization. (a) NBD is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware.
NBD has the corporate power and authority to own or lease all of its properties
and assets and to carry on its business as it is now being conducted, and is
duly licensed or qualified to do business in each jurisdiction in which the
nature of the business conducted by it or the character or location of the
properties and assets owned or leased by it makes such licensing or
qualification necessary, except where the failure to be so licensed or qualified
would not have a Material Adverse Effect on NBD. As used in this Agreement, the
term "Material Adverse Effect" means, with respect to First Chicago, NBD or the
Surviving Corporation, as the case may be, a material adverse effect on the
business, results of operations, financial condition, or (insofar as they can
reasonably be foreseen) prospects of such party and its Subsidiaries taken as a
whole. As used in this Agreement, the word "Subsidiary" when used with respect
to any party means any bank, corporation, partnership, limited liability
company, or other organization, whether incorporated or unincorporated, which is
consolidated with such party for financial reporting purposes. NBD is duly
registered as a bank holding company under the Bank Holding Company Act of 1956,
as amended (the "BHC Act") and as a savings and loan holding company under the
Home Owners' Loan Act ("HOLA"). True and complete copies of the Certificate of
Incorporation and By-Laws of NBD, as in effect as of the date of this Agreement,
have previously been made available by NBD to First Chicago.
(b) Each NBD Subsidiary (i) is duly organized and validly existing as a
bank, corporation, partnership or limited liability company under the laws of
its jurisdiction of organization, (ii) is duly qualified to do business and in
good standing in all jurisdictions (whether federal, state, local or foreign)
where its ownership or leasing of property or the conduct of its business
requires it to be so qualified and in which the failure to be so qualified would
have a Material Adverse Effect on NBD, and (iii) has all requisite corporate
power and authority to own or lease its properties and assets and to carry on
its business as now conducted.
(c) The minute books of NBD accurately reflect in all material respects
all corporate actions held or taken since January 1, 1993 of its stockholders
and Board of Directors
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<PAGE>
(including committees of the Board of Directors of NBD).
3.2 Capitalization. (a) The authorized capital stock of NBD consists of
(i) 500,000,000 shares of NBD Common Stock, of which as of June 30, 1995,
157,139,395 shares were issued and outstanding and 3,743,613 shares were held in
treasury, and (ii) 10,460,000 shares of Preferred Stock (the "NBD Preferred
Stock"), of which as of June 30, 1995, (A) 10,000,000 shares were designated and
no shares were issued and outstanding as Preferred Stock, no par value, and (B)
460,000 shares were designated and no shares were issued and outstanding as
Series A Preferred Stock, par value $1.00 per share. All of the issued and
outstanding shares of NBD Capital Stock have been duly authorized and validly
issued and are fully paid, nonassessable and free of preemptive rights, with no
personal liability attaching to the ownership thereof. As of the date of this
Agreement, except pursuant to the terms of NBD's issued and outstanding
Preferred Stock Purchase Units ("NBD Units") and for the NBD Option Agreement,
NBD does not have and is not bound by any outstanding subscriptions, options,
warrants, calls, commitments or agreements of any character calling for the
purchase or issuance of any shares of NBD Capital Stock or any other equity
securities of NBD or any securities representing the right to purchase or
otherwise receive any shares of NBD Common Stock or NBD Preferred Stock. As of
June 30, 1995, no shares of NBD Common Stock were reserved for issuance, except
for (i) 2,152,022 shares reserved for issuance upon the exercise of stock
options pursuant to the NBD Stock Plans (as defined in Section 6.7), (ii) 32,243
shares reserved for issuance as awards under the NBD Directors Stock Award Plans
and (iii) 546,170 shares reserved for issuance upon the exercise of options
granted in substitution for options assumed in prior NBD acquisitions. The only
shares of NBD Preferred Stock reserved for issuance were 1,500,000 shares
reserved pursuant to NBD Units. Since June 30, 1995, NBD has not issued any
shares of its capital stock or any securities convertible into or exercisable
for any shares of its capital stock, other than pursuant to the exercise of
employee stock options granted prior to such date. The shares of NBD Capital
Stock to be issued pursuant to the Merger will be duly authorized and validly
issued and, at the Effective Time, all such shares will be fully paid,
nonassessable and free of preemptive rights, with no personal liability
attaching to the ownership thereof.
(b) NBD owns, directly or indirectly, all of the issued and outstanding
shares of capital stock of each of the NBD Subsidiaries, free and clear of any
liens, pledges, charges, encumbrances and security interests whatsoever
("Liens"), and all of such shares are duly authorized and validly issued and are
fully paid, nonassessable and free of preemptive rights, with no personal
liability attaching to the ownership thereof. No NBD Subsidiary has or is bound
by any outstanding subscrip-
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<PAGE>
tions, options, warrants, calls, commitments or agreements of any character
calling for the purchase or issuance of any shares of capital stock or any other
equity security of such Subsidiary or any securities representing the right to
purchase or otherwise receive any shares of capital stock or any other equity
security of such Subsidiary.
3.3 Authority; No Violation. (a) NBD has full corporate power and
authority to execute and deliver this Agreement and to consummate the
transactions contemplated hereby. The execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby have been duly and
validly approved by the Board of Directors of NBD. The Board of Directors of
NBD has directed that this Agreement and the transactions contemplated hereby be
submitted to NBD's stockholders for approval at a meeting of such stockholders
and, except for the adoption of this Agreement by the affirmative vote of the
holders of a majority of the outstanding shares of NBD Common Stock, no other
corporate proceedings on the part of NBD are necessary to approve this Agreement
and to consummate the transactions contemplated hereby. This Agreement has been
duly and validly executed and delivered by NBD and (assuming due authorization,
execution and delivery by First Chicago) constitutes a valid and binding
obligation of NBD, enforceable against NBD in accordance with its terms.
(b) Neither the execution and delivery of this Agreement by NBD nor the
consummation by NBD of the transactions contemplated hereby, nor compliance by
NBD with any of the terms or provisions hereof, will (i) violate any provision
of the Certificate of Incorporation or By-Laws of NBD or (ii) assuming that the
consents and approvals referred to in Section 3.4 are duly obtained, (x) violate
any statute, code, ordinance, rule, regulation, judgment, order, writ, decree or
injunction applicable to NBD or any of its Subsidiaries or any of their
respective properties or assets, or (y) violate, conflict with, result in a
breach of any provision of or the loss of any benefit under, constitute a
default (or an event which, with notice or lapse of time, or both, would
constitute a default) under, result in the termination of or a right of
termination or cancellation under, accelerate the performance required by, or
result in the creation of any Lien upon any of the respective properties or
assets of NBD or any of its Subsidiaries under, any of the terms, conditions or
provisions of any note, bond, mortgage, indenture, deed of trust, license,
lease, agreement or other instrument or obligation to which NBD or any of its
Subsidiaries is a party, or by which they or any of their respective properties
or assets may be bound or affected, except (in the case of clause (y) above) for
such violations,
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<PAGE>
conflicts, breaches or defaults which, either individually or in the aggregate,
will not have or be reasonably likely to have a Material Adverse Effect on NBD
or the Surviving Corporation.
3.4 Consents and Approvals. Except for (i) the filing of applications and
notices, as applicable, with the Board of Governors of the Federal Reserve
System (the "Federal Reserve Board") under the BHC Act and approval of such
applications and notices, (ii) the filing of any required applications with the
Office of Thrift Supervision (the "OTS") (iii) the filing of any required
applications or notices with any state or foreign agencies and approval of such
applications and notices (the "State Approvals"), (iv) the filing with the
Securities and Exchange Commission (the "SEC") of a joint proxy statement in
definitive form relating to the meetings of First Chicago's and NBD's
stockholders to be held in connection with this Agreement and the transactions
contemplated hereby (the "Joint Proxy Statement") and the registration statement
on Form S-4 (the "S-4") in which the Joint Proxy Statement will be included as a
prospectus, (v) the filing of the Certificate of Merger with the Delaware
Secretary pursuant to the DGCL, (vi) any notices to or filings with the Small
Business Administration ("SBA"), (vii) any consent, authorizations, approvals,
filings or exemptions in connection with compliance with the applicable
provisions of federal and state securities laws relating to the regulation of
broker-dealers or investment advisers, and federal commodities laws relating to
the regulation of futures commission merchants and the rules and regulations
thereunder and of any applicable industry self-regulatory organization ("SRO"),
and the rules of the NYSE, or which are required under consumer finance,
mortgage banking and other similar laws, (viii) such filings and approvals as
are required to be made or obtained under the securities or "Blue Sky" laws of
various states in connection with the issuance of the shares of NBD Common Stock
pursuant to this Agreement, and (ix) the approval of this Agreement by the
requisite vote of the stockholders of First Chicago and NBD, no consents or
approvals of or filings or registrations with any court, administrative agency
or commission or other governmental authority or instrumentality (each a
"Governmental Entity") or with any third party are necessary in connection with
(A) the execution and delivery by NBD of this Agreement and (B) the consummation
by NBD of the Merger and the other transactions contemplated hereby.
3.5 Reports. NBD and each of its Subsidiaries have timely filed all
reports, registrations and statements, together with any amendments required to
be made with respect thereto, that they were required to file since January 1,
1993 with (i) the Federal Reserve Board, (ii) the Federal Deposit Insurance
Corporation, (iii) any state regulatory authority (each a "State Regulator"),
(iv) the Office of the Comptroller of the Currency (the "OCC"), (v) the OTS,
(vi) the SEC and (vii) any SRO (col-
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<PAGE>
lectively "Regulatory Agencies"), and all other reports and statements required
to be filed by them since January 1, 1993, including, without limitation, any
report or statement required to be filed pursuant to the laws, rules or
regulations of the United States, any state, or any Regulatory Agency and have
paid all fees and assessments due and payable in connection therewith, except
where the failure to file such report, registration or statement or to pay such
fees and assessments, either individually or in the aggregate, will not have a
Material Adverse Effect on NBD. Except for normal examinations conducted by a
Regulatory Agency in the regular course of the business of NBD and its
Subsidiaries, no Regulatory Agency has initiated any proceeding or, to the best
knowledge of NBD, investigation into the business or operations of NBD or any of
its Subsidiaries since January 1, 1993, except where such proceedings or
investigation are not likely, either individually or in the aggregate, to have a
Material Adverse Effect on NBD. There is no unresolved violation, criticism, or
exception by any Regulatory Agency with respect to any report or statement
relating to any examinations of NBD or any of its Subsidiaries which, in the
reasonable judgment of NBD, is likely, either individually or in the aggregate,
to have a Material Adverse Effect on NBD.
3.6 Financial Statements. NBD has previously made available to First
Chicago copies of (a) the consolidated balance sheets of NBD and its
Subsidiaries as of December 31, for the fiscal years 1993 and 1994, and the
related consolidated statements of income, changes in stockholders' equity and
cash flows for the fiscal years 1992 through 1994, inclusive, as reported in
NBD's Annual Report on Form 10-K for the fiscal year ended December 31, 1994
filed with the SEC under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), in each case accompanied by the audit report of Deloitte &
Touche LLP, independent public accountants with respect to NBD, and (b) the
unaudited consolidated balance sheet of NBD and its Subsidiaries as of March 31,
1994 and March 31, 1995 and the related unaudited consolidated statements of
income, cash flows and changes in stockholders' equity for the three-month
periods then ended as reported in NBD's Quarterly Report on Form 10-Q for the
period ended March 31, 1995 filed with the SEC under the Exchange Act (the "NBD
March 31, 1995 Form 10-Q"). The December 31, 1994 consolidated balance sheet of
NBD (including the related notes, where applicable) fairly presents the
consolidated financial position of NBD and its Subsidiaries as of the date
thereof, and the other financial statements referred to in this Section 3.6
(including the related notes, where applicable) fairly present (subject, in the
case of the unaudited statements, to recurring audit adjustments normal in
nature and amount) the results of the consolidated operations and changes
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<PAGE>
in stockholders' equity and consolidated financial position of NBD and its
Subsidiaries for the respective fiscal periods or as of the respective dates
therein set forth; each of such statements (including the related notes, where
applicable) comply in all material respects with applicable accounting
requirements and with the published rules and regulations of the SEC with
respect thereto; and each of such statements (including the related notes, where
applicable) has been prepared in all material respects in accordance with
generally accepted accounting principles ("GAAP") consistently applied during
the periods involved, except, in each case, as indicated in such statements or
in the notes thereto or, in the case of unaudited statements, as permitted by
Form 10-Q. The books and records of NBD and its Subsidiaries have been, and are
being, maintained in all material respects in accordance with GAAP and any other
applicable legal and accounting requirements and reflect only actual
transactions.
3.7 Broker's Fees. Neither NBD nor any NBD Subsidiary nor any of their
respective officers or directors has employed any broker or finder or incurred
any liability for any broker's fees, commissions or finder's fees in connection
with the Merger or related transactions contemplated by this Agreement or the
Option Agreements.
3.8 Absence of Certain Changes or Events. (a) Except as publicly
disclosed in NBD Reports (as defined in Section 3.12) filed prior to the date
hereof, since March 31, 1995, (i) NBD and its Subsidiaries taken as a whole have
not incurred any material liability, except in the ordinary course of their
business, and (ii) no event has occurred which has had, individually or in the
aggregate, a Material Adverse Effect on NBD or the Surviving Corporation.
(b) Except as publicly disclosed in NBD Reports filed prior to the date
hereof, since March 31, 1995, NBD and its Subsidiaries have carried on their
respective businesses in all material respects in the ordinary and usual course.
(c) Since December 31, 1994, neither NBD nor any of its Subsidiaries has
(i) except for such actions as are in the ordinary course of business consistent
with past practice or except as required by applicable law, (A) increased the
wages, salaries, compensation, pension, or other fringe benefits or perquisites
payable to any executive officer, employee, or director from the amount thereof
in effect as of December 31, 1994, or (B) granted any severance or termination
pay, entered into any contract to make or grant any severance or termination
pay, or paid any bonuses aggregating in excess of 5% of NBD's 1994 salary and
employee benefits expenses, other than customary year-end bonuses for fiscal
1994 and 1995, or (ii) suffered any strike, work stoppage, slowdown, or other
labor disturbance
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which, in the reasonable judgment of NBD, is likely, either individually or in
the aggregate, to have a Material Adverse Effect on NBD.
3.9 Legal Proceedings. (a) Neither NBD nor any of its Subsidiaries is a
party to any, and there are no pending or, to the best of NBD's knowledge,
threatened, material legal, administrative, arbitral or other proceedings,
claims, actions or governmental or regulatory investigations of any nature
against NBD or any of its Subsidiaries or challenging the validity or propriety
of the transactions contemplated by this Agreement or the NBD Option Agreement
as to which there is a reasonable probability of an adverse determination and
which, if adversely determined, would, individually or in the aggregate, have a
Material Adverse Effect on NBD.
(b) There is no injunction, order, judgment, decree, or regulatory
restriction (other than those that apply to similarly situated bank holding
companies or banks) imposed upon NBD, any of its Subsidiaries or the assets of
NBD or any of its Subsidiaries which has had, or might reasonably be expected to
have, a Material Adverse Effect on NBD.
3.10 Taxes and Tax Returns. (a) Each of NBD and its Subsidiaries has
duly filed all federal, state, county, foreign and, to the best of NBD's
knowledge, local information returns and tax returns required to be filed by it
on or prior to the date hereof (all such returns being accurate and complete in
all material respects) and has duly paid or made provisions for the payment of
all Taxes (as defined in Section 3.10(b)) and other governmental charges which
have been incurred or are due or claimed to be due from it by federal, state,
county, foreign or local taxing authorities on or prior to the date of this
Agreement (including, without limitation, if and to the extent applicable, those
due in respect of its properties, income, business, capital stock, deposits,
franchises, licenses, sales and payrolls) other than (i) Taxes or other charges
which are not yet delinquent or are being contested in good faith and have not
been finally determined, or (ii) information returns, tax returns, Taxes or
other governmental charges the failure to file, pay or make provision for,
either individually or in the aggregate, are not likely, in the reasonable
judgment of NBD, to have a Material Adverse Effect on NBD. The income tax
returns of NBD and its Subsidiaries have been examined by the Internal Revenue
Service (the "IRS") and any liability with respect thereto has been satisfied
for all years to and including 1987, and either no material deficiencies were
asserted as a result of such examination for which NBD does not have adequate
reserves or all such deficiencies were satisfied. To the best of NBD's
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knowledge, there are no material disputes pending, or claims asserted for, Taxes
or assessments upon NBD or any of its Subsidiaries for which NBD does not have
adequate reserves, nor has NBD or any of its Subsidiaries given any currently
effective waivers extending the statutory period of limitation applicable to any
federal, state, county or local income tax return for any period. In addition,
(A) proper and accurate amounts have been withheld by NBD and its Subsidiaries
from their employees for all prior periods in compliance in all material
respects with the tax withholding provisions of applicable federal, state and
local laws, except where failure to do so would not have a Material Adverse
Effect on NBD, (B) federal, state, county and local returns which are accurate
and complete in all material respects have been filed by NBD and its
Subsidiaries for all periods for which returns were due with respect to income
tax withholding, Social Security and unemployment taxes, except where failure to
do so would not have a Material Adverse Effect on NBD, (C) the amounts shown on
such federal, state, local or county returns to be due and payable have been
paid in full or adequate provision therefor has been included by NBD in its
consolidated financial statements as of December 31, 1994, except where failure
to do so would not have a Material Adverse Effect on NBD and (D) there are no
Tax liens upon any property or assets of NBD or its Subsidiaries except liens
for current taxes not yet due or liens that would not have a Material Adverse
Effect on NBD. Neither NBD nor any of its Subsidiaries has been required to
include in income any adjustment pursuant to Section 481 of the Code by reason
of a voluntary change in accounting method initiated by NBD or any of its
Subsidiaries, and the IRS has not initiated or proposed any such adjustment or
change in accounting method, in either case which has had or is reasonably
likely to have a Material Adverse Effect on NBD. Except as set forth in the
financial statements described in Section 3.6, neither NBD nor any of its
Subsidiaries has entered into a transaction which is being accounted for as an
installment obligation under Section 453 of the Code, which would be reasonably
likely to have a Material Adverse Effect on NBD.
(b) As used in this Agreement, the term "Tax" or "Taxes" means all
federal, state, county, local, and foreign income, excise, gross receipts, gross
income, ad valorem, profits, gains, property, capital, sales, transfer, use,
-- -------
payroll, employment, severance, withholding, duties, intangibles, franchise,
backup withholding, and other taxes, charges, levies or like assessments
together with all penalties and additions to tax and interest thereon.
(c) Any amount that is reasonably likely to be received (whether in cash
or property or the vesting of property) as a result of any of the transactions
contemplated by this Agreement by any employee, officer or director of NBD or
any of its
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affiliates who is a "Disqualified Individual" (as such term is defined in
proposed Treasury Regulation Section 1.280G-1) under any employment, severance
or termination agreement, other compensation arrangement or NBD Benefit Plan (as
defined in Section 3.11(a)) currently in effect should not be characterized as
an "excess parachute payment" (as such term is defined in Section 280G(b)(1) of
the Code).
(d) No disallowance of a deduction under Section 162(m) of the Code for
employee remuneration of any amount paid or payable by NBD or any Subsidiary of
NBD under any contract, plan, program, arrangement or understanding would be
reasonably likely to have a Material Adverse Effect on NBD.
3.11 Employees. (a) The NBD Disclosure Schedule sets forth a true and
complete list of each material employee benefit plan, arrangement or agreement
that is maintained as of the date of this Agreement (the "NBD Benefit Plans") by
NBD or any of its Subsidiaries or by any trade or business, whether or not
incorporated (an "NBD ERISA Affiliate"), all of which together with NBD would be
deemed a "single employer" within the meaning of Section 4001 of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA").
(b) NBD has heretofore delivered to First Chicago true and complete copies
of each of the NBD Benefit Plans and certain related documents, including, but
not limited to, (i) the actuarial report for such NBD Benefit Plan (if
applicable) for each of the last two years, and (ii) the most recent
determination letter from the IRS (if applicable) for such Plan.
(c) (i) Each of the NBD Benefit Plans has been operated and administered
in all material respects with applicable laws, including, but not limited to,
ERISA and the Code, (ii) each of the NBD Benefit Plans intended to be
"qualified" within the meaning of Section 401(a) of the Code is so qualified,
(iii) with respect to each Plan which is subject to Title IV of ERISA, the
present value of accrued benefits under such Plan, based upon the actuarial
assumptions used for funding purposes in the most recent actuarial report
prepared by such Plan's actuary with respect to such Plan, did not, as of its
latest valuation date, exceed the then current value of the assets of such Plan
allocable to such accrued benefits, (iv) no NBD Benefit Plan provides benefits,
including, without limitation, death or medical benefits (whether or not
insured), with respect to current or former employees of NBD, its Subsidiaries
or any ERISA Affiliate beyond their retirement or other termination of service,
other than (A) coverage mandated by applicable law, (B) death benefits or
retirement benefits under any "employee
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pension plan" (as such term is defined in Section 3(2) of ERISA), (C) deferred
compensation benefits accrued as liabilities on the books of NBD, its
Subsidiaries or the ERISA Affiliates or (D) benefits the full cost of which is
borne by the current or former employee (or his beneficiary), (v) no material
liability under Title IV of ERISA has been incurred by NBD, its Subsidiaries or
any ERISA Affiliate that has not been satisfied in full, and no condition exists
that presents a material risk to NBD, its Subsidiaries or any ERISA Affiliate of
incurring a material liability thereunder, (vi) no Plan is a "multiemployer
pension plan" (as such term is defined in Section 3(37) of ERISA), (vii) all
contributions or other amounts payable by NBD or its Subsidiaries as of the
Effective Time with respect to each NBD Benefit Plan in respect of current or
prior plan years have been paid or accrued in accordance with GAAP and Section
412 of the Code, (viii) neither NBD, its Subsidiaries nor any ERISA Affiliate
has engaged in a transaction in connection with which NBD, its Subsidiaries or
any ERISA Affiliate reasonably could be subject to either a material civil
penalty assessed pursuant to Section 409 or 502(i) of ERISA or a material tax
imposed pursuant to Section 4975 or 4976 of the Code, and (ix) to the best
knowledge of NBD there are no pending, threatened or anticipated claims (other
than routine claims for benefits) by, on behalf of or against any of the NBD
Benefit Plans or any trusts related thereto which are, in the reasonable
judgment of NBD, likely, either individually or in the aggregate, to have a
Material Adverse Effect on NBD.
(d) Neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby will (i) result in any
material payment (including, without limitation, severance, unemployment
compensation, golden parachute or otherwise) becoming due to any director or any
employee of NBD or any of its affiliates from NBD or any of its affiliates under
any NBD Benefit Plan or otherwise, (ii) materially increase any benefits
otherwise payable under any NBD Benefit Plan or (iii) result in any acceleration
of the time of payment or vesting of any such benefits to any material extent.
3.12 SEC Reports. NBD has previously made available to First Chicago an
accurate and complete copy of each (a) final registration statement, prospectus,
report, schedule and definitive proxy statement filed since January 1, 1993 by
NBD with the SEC pursuant to the Securities Act of 1933, as amended (the
"Securities Act"), or the Exchange Act (the "NBD Reports") and prior to the date
hereof and (b) communication mailed by NBD to its stockholders since January 1,
1993 and prior to the date hereof, and no such registration statement,
prospectus, report, schedule, proxy statement or communication contained any
untrue statement of a material fact or omitted to state any material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances in which
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they were made, not misleading, except that information as of a later date shall
be deemed to modify information as of an earlier date. Since January 1, 1993,
NBD has timely filed all NBD Reports and other documents required to be filed by
it under the Securities Act and the Exchange Act, and, as of their respective
dates, all NBD Reports complied in all material respects with the published
rules and regulations of the SEC with respect thereto.
3.13 Compliance with Applicable Law. NBD and each of its Subsidiaries
hold all material licenses, franchises, permits and authorizations necessary for
the lawful conduct of their respective businesses under and pursuant to all, and
have complied in all material respects with and are not in default in any
material respect under any, applicable law, statute, order, rule, regulation,
policy and/or guideline of any Governmental Entity relating to NBD or any of its
Subsidiaries, except where the failure to hold such license, franchise, permit
or authorization or such noncompliance or default would not, individually or in
the aggregate, have a Material Adverse Effect on NBD.
3.14 Certain Contracts. (a) Neither NBD nor any of its Subsidiaries is a
party to or bound by any contract, arrangement, commitment or understanding
(whether written or oral) (i) with respect to the employment of any directors,
officers or employees other than in the ordinary course of business consistent
with past practice, (ii) which, upon the consummation of the transactions
contemplated by this Agreement will (either alone or upon the occurrence of any
additional acts or events) result in any payment (whether of severance pay or
otherwise) becoming due from First Chicago, NBD, the Surviving Corporation, or
any of their respective Subsidiaries to any officer or employee thereof, (iii)
which is a "material contract" (as such term is defined in Item 601(b)(10) of
Regulation S-K of the SEC) to be performed after the date of this Agreement that
has not been filed or incorporated by reference in the NBD Reports, (iv) which
materially restricts the conduct of any line of business by NBD, (v) with or to
a labor union or guild (including any collective bargaining agreement) or (vi)
(including any stock option plan, stock appreciation rights plan, restricted
stock plan or stock purchase plan) any of the benefits of which will be
increased, or the vesting of the benefits of which will be accelerated, by the
occurrence of any of the transactions contemplated by this Agreement, or the
value of any of the benefits of which will be calculated on the basis of any of
the transactions contemplated by this Agreement. NBD has previously made
available to First Chicago true and correct copies of all employment and
deferred compensation agreements which are in writing and to which NBD is a
party. Each contract, ar-
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rangement, commitment or understanding of the type described in this Section
3.14(a), whether or not set forth in the NBD Disclosure Schedule, is referred to
herein as an "NBD Contract", and neither NBD nor any of its Subsidiaries knows
of, or has received notice of, any violation of the above by any of the other
parties thereto which, individually or in the aggregate, would have a Material
Adverse Effect on NBD.
(b) (i) Each NBD Contract is valid and binding on NBD or any of its
Subsidiaries, as applicable, and in full force and effect, (ii) NBD and each of
its Subsidiaries has in all material respects performed all obligations required
to be performed by it to date under each NBD Contract, except where such
noncompliance, individually or in the aggregate, would not have a Material
Adverse Effect on NBD, and (iii) no event or condition exists which constitutes
or, after notice or lapse of time or both, would constitute, a material default
on the part of NBD or any of its Subsidiaries under any such NBD Contract,
except where such default, individually or in the aggregate, would not have a
Material Adverse Effect on NBD.
3.15 Agreements with Regulatory Agencies. Neither NBD nor any of its
Subsidiaries is subject to any cease-and-desist or other order issued by, or is
a party to any written agreement, consent agreement or memorandum of
understanding with, or is a party to any commitment letter or similar
undertaking to, or is subject to any order or directive by, or has been since
January 1, 1993, a recipient of any supervisory letter from, or since January 1,
1993, has adopted any board resolutions at the request of any Regulatory Agency
or other Governmental Entity that currently restricts in any material respect
the conduct of its business or that in any material manner relates to its
capital adequacy, its credit policies, its management or its business (each,
whether or not set forth in the NBD Disclosure Schedule, an "NBD Regulatory
Agreement"), nor has NBD or any of its Subsidiaries been advised since January
1, 1993, by any Regulatory Agency or other Governmental Entity that it is
considering issuing or requesting any such Regulatory Agreement.
3.16 Other Activities of NBD and its Subsidiaries.
(a) Neither NBD nor any of its Subsidiaries that is neither a bank, a bank
operating subsidiary or a bank service corporation, directly or indirectly,
engages in any activity prohibited by the Federal Reserve Board. Without
limiting the generality of the foregoing, any equity investment of NBD and each
Subsidiary that is not a bank, a bank operating subsidiary or a bank service
corporation, is not prohibited by the Federal Reserve Board.
(b) To NBD's knowledge, each NBD Subsidiary which is a bank (a "NBD Bank
Subsidiary") currently performs all personal
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trust, corporate trust and other fiduciary activities ("Trust Activities") with
requisite authority under applicable law of Governmental Entities and in
accordance in all material respects with the agreed-upon terms of the agreements
and instruments governing such Trust Activities, sound fiduciary principles and
applicable law and regulation (specifically including, but not limited to,
Section 9 of Title 12 of the Code of Federal Regulations); there is no
investigation or inquiry by any Governmental Entity pending, or to the knowledge
of NBD, threatened, against or affecting NBD, or any Significant Subsidiary
thereof relating to the compliance by NBD or any such Significant Subsidiary (as
such term is defined in Rule 1-02(w) of Regulation S-X of the SEC) with sound
fiduciary principles and applicable regulations; and except where any such
failure would not have a Material Adverse Effect on NBD, each employee of a NBD
Bank Subsidiary had the authority to act in the capacity in which he or she
acted with respect to Trust Activities, in each case, in which such employee
held himself or herself out as a representative of a NBD Bank Subsidiary; and
each NBD Bank Subsidiary has established policies and procedures for the purpose
of complying with applicable laws of Governmental Entities relating to Trust
Activities, has followed such policies and procedures in all material respects
and has performed appropriate internal audit reviews of, and has engaged
independent accountants to perform audits of, Trust Activities, which audits
since January 1, 1993 have disclosed no material violations of applicable laws
of Governmental Entities or such policies and procedures.
3.17 Investment Securities. Each of NBD and its Subsidiaries has good and
marketable title to all securities held by it (except securities sold under
repurchase agreements or held in any fiduciary or agency capacity), free and
clear of any Lien, except to the extent such securities are pledged in the
ordinary course of business consistent with prudent banking practices to secure
obligations of NBD or any of its Subsidiaries. Such securities are valued on
the books of NBD in accordance with GAAP.
3.18 Interest Rate Risk Management Instruments. All interest rate swaps,
caps, floors and option agreements and other interest rate risk management
arrangements, whether entered into for the account of NBD or for the account of
a customer of NBD or one of its Subsidiaries, were entered into in the ordinary
course of business and, to NBD's knowledge, in accordance with prudent banking
practice and applicable rules, regulations and policies of any Regulatory
Authority and with counterparties believed to be financially responsible at the
time and are legal, valid and binding obligations of NBD or one of its
Sub-
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sidiaries enforceable in accordance with their terms (except as may be
limited by bankruptcy, insolvency, moratorium, reorganization or similar laws
affecting the rights of creditors generally and the availability of equitable
remedies), and are in full force and effect. NBD and each of its Subsidiaries
have duly performed in all material respects all of their material obligations
thereunder to the extent that such obligations to perform have accrued; and, to
NBD's knowledge, there are no material breaches, violations or defaults or
allegations or assertions of such by any party thereunder.
3.19 Undisclosed Liabilities. Except for those liabilities that are fully
reflected or reserved against on the consolidated balance sheet of NBD included
in the NBD March 31, 1995 Form 10-Q and for liabilities incurred in the ordinary
course of business consistent with past practice, since March 31, 1995, neither
NBD nor any of its Subsidiaries has incurred any liability of any nature
whatsoever (whether absolute, accrued, contingent or otherwise and whether due
or to become due) that, either alone or when combined with all similar
liabilities, has had, or could reasonably be expected to have, a Material
Adverse Effect on NBD.
3.20 Environmental Liability. Except as set forth in the NBD Disclosure
Schedule, there are no legal, administrative, arbitral or other proceedings,
claims, actions, causes of action, private environmental investigations or
remediation activities or governmental investigations of any nature seeking to
impose, or that could reasonably result in the imposition, on NBD of any
liability or obligation arising under common law or under any local, state or
federal environmental statute, regulation or ordinance including, without
limitation, the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended ("CERCLA"), pending or threatened against NBD, which
liability or obligation could reasonably be expected to have a Material Adverse
Effect on NBD. To the knowledge of NBD, there is no reasonable basis for any
such proceeding, claim, action or governmental investigation that would impose
any material liability or obligation that could reasonably be expected to have a
Material Adverse Effect on NBD. NBD is not subject to any agreement, order,
judgment, decree, letter or memorandum by or with any court, governmental
authority, regulatory agency or third party imposing any material liability or
obligation that could reasonably be expected to have a Material Adverse Effect
on NBD.
3.21 State Takeover Laws. The Board of Directors of NBD has approved the
transactions contemplated by this Agreement and the Option Agreements such that
the provisions of Section 203 of the DGCL will not apply to this Agreement or
the Option Agreements or any of the transactions contemplated hereby or thereby.
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3.22 Pooling of Interests. As of the date of this Agreement, NBD has no
reason to believe that the Merger will not qualify as a "pooling of interests"
for accounting purposes.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF FIRST CHICAGO
4.
Except as disclosed in the First Chicago disclosure schedule delivered to
NBD concurrently herewith (the "First Chicago Disclosure Schedule") First
Chicago hereby represents and warrants to NBD as follows:
4.1 Corporate Organization. (a) First Chicago is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware. First Chicago has the corporate power and authority to own or lease
all of its properties and assets and to carry on its business as it is now being
conducted, and is duly licensed or qualified to do business in each jurisdiction
in which the nature of the business conducted by it or the character or location
of the properties and assets owned or leased by it makes such licensing or
qualification necessary, except where the failure to be so licensed or qualified
would not have a Material Adverse Effect on First Chicago. First Chicago is
duly registered as a bank holding company under the BHC Act. True and complete
copies of the Certificate of Incorporation and By-Laws of First Chicago, as in
effect as of the date of this Agreement, have previously been made available by
First Chicago to NBD.
(b) Each First Chicago Subsidiary (i) is duly organized and validly
existing as a bank, corporation, partnership or limited liability company under
the laws of its jurisdiction of organization, (ii) is duly qualified to do
business and in good standing in all jurisdictions (whether Federal, state,
local or foreign) where its ownership or leasing of property or the conduct of
its business requires it to be so qualified and in which the failure to be so
qualified would have a Material Adverse Effect on First Chicago, and (iii) has
all requisite corporate power and authority to own or lease its properties and
assets and to carry on its business as now conducted.
(c) The minute books of First Chicago accurately reflect in all material
respects all corporate actions held or taken since January 1, 1993 of its
stockholders and Board of Directors (including committees of the Board of
Directors of First Chicago).
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4.2 Capitalization. (a) The authorized capital stock of First Chicago
consists of 150,000,000 shares of First Chicago Common Stock, of which, as of
June 30, 1995, 89,719,497 were issued and outstanding, and 15,000,000 shares of
Preferred Stock, no par value (the "First Chicago Preferred Stock", of which (i)
2,500,000 shares were designated and 2,410,000 shares were issued and
outstanding as Preferred Stock with Cumulative and Adjustable Dividends ("First
Chicago Series A Cumulative Adjustable Rate Preferred Stock"), (ii) 1,250,000
shares were designated and 1,191,000 shares were issued and outstanding as
Preferred Stock with Cumulative and Adjustable Dividends, Series B ("First
Chicago Series B Cumulative Adjustable Rate Preferred Stock"), (iii) 750,000
shares were designated and 713,800 were issued and outstanding as Preferred
Stock with Cumulative and Adjustable Dividends, Series C ("First Chicago Series
C Cumulative Adjustable Rate Preferred Stock"), (iv) 160,000 shares were
designated and 160,000 shares were issued and outstanding as 8.45% Cumulative
Preferred Stock, Series E ("First Chicago 8.45% Series E Cumulative Fixed Rate
Preferred Stock"), and (v) 40,000 shares were designated and 40,000 shares were
issued and outstanding as 5-3/4% Cumulative Convertible Preferred Stock, Series
B ("First Chicago Convertible Preferred Stock"). As of June 30, 1995, 3,710,822
shares of First Chicago Common Stock were held in First Chicago's treasury. On
June 30, 1995, no shares of First Chicago Common Stock or First Chicago
Preferred Stock were reserved for issuance, except for (i) 5,877,204 shares of
First Chicago Common Stock reserved for issuance upon the exercise of stock
options pursuant to the First Chicago Stock Plans, (ii) shares of First Chicago
Series A Junior Participating Preferred Stock were reserved for issuance upon
exercise of the rights (the "First Chicago Rights") distributed to holders of
First Chicago Common Stock pursuant to the Rights Agreement, dated as of
November 18, 1988, between First Chicago and Bankers Trust Company, as Rights
Agent (the "First Chicago Rights Agreement"), (iii) the shares of First Chicago
Common Stock issuable pursuant to the First Chicago Option Agreement, (iv)
shares of First Chicago Common Stock reserved for issuance pursuant to the First
Chicago Dividend Reinvestment and Stock Purchase Plan (the "First Chicago
DRIP"), (v) shares of First Chicago Common Stock reserved for issuance pursuant
to the 1994 offering of the First Chicago Employee Stock Purchase and Savings
Plan (as in effect as of the Effective Time, the "First Chicago ESPSP"), and
(vi) shares of First Chicago Common Stock reserved for issuance upon conversion
of First Chicago Convertible Preferred Stock. All of the issued and outstanding
shares of First Chicago Common Stock and First Chicago Preferred Stock have been
duly authorized and validly issued and are fully paid, nonassessable and free of
preemptive rights, with no personal liability attaching to the ownership
thereof. As of the date of this Agreement, except for the First Chicago Rights
Agreement, the First Chicago Option Agreement, the First Chicago Convertible
Preferred Stock, the First Chicago DRIP, the First
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Chicago ESPSP and the First Chicago Stock Plans, First Chicago does not have and
is not bound by any outstanding subscriptions, options, warrants, calls,
commitments or agreements of any character calling for the purchase or issuance
of any shares of First Chicago Common Stock or First Chicago Preferred Stock or
any other equity securities of First Chicago or any securities representing the
right to purchase or otherwise receive any shares of First Chicago Common Stock
or First Chicago Preferred Stock. Assuming compliance by NBD with Article I of
this Agreement, after the Effective Time, there will not be any outstanding
subscriptions, options, warrants, calls, commitments or agreements of any
character by which First Chicago or any of its Subsidiaries will be bound
calling for the purchase or issuance of any shares of the capital stock of First
Chicago. First Chicago has previously provided NBD with a list of the option
holders, the date of each option to purchase First Chicago Common Stock granted,
the number of shares subject to each such option, the expiration date of each
such option, and the price at which each such option may be exercised under an
applicable First Chicago Stock Plan. Since June 30, 1995, First Chicago has not
issued any shares of its capital stock or any securities convertible into or
exercisable for any shares of its capital stock, other than pursuant to (i) the
exercise of employee stock options granted prior to such date, (ii) the First
Chicago DRIP, and (iii) the First Chicago ESPSP.
(b) First Chicago owns, directly or indirectly, all of the issued and
outstanding shares of capital stock of each of the First Chicago Subsidiaries,
free and clear of any Liens, and all of such shares are duly authorized and
validly issued and are fully paid, nonassessable and free of preemptive rights,
with no personal liability attaching to the ownership thereof. No First Chicago
Subsidiary has or is bound by any outstanding subscriptions, options, warrants,
calls, commitments or agreements of any character calling for the purchase or
issuance of any shares of capital stock or any other equity security of such
Subsidiary or any securities representing the right to purchase or otherwise
receive any shares of capital stock or any other equity security of such
Subsidiary.
4.3 Authority; No Violation. (a) First Chicago has full corporate power
and authority to execute and deliver this Agreement and to consummate the
transactions contemplated hereby. The execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby have been duly and
validly approved by the Board of Directors of First Chicago. The Board of
Directors of First Chicago has directed that this Agreement and the transactions
contemplated hereby be submitted to First Chicago's stockholders for approval at
a meeting of
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such stockholders and except for the adoption of this Agreement by the
affirmative vote of the holders of a majority of the outstanding shares of First
Chicago Common Stock, no other corporate proceedings on the part of First
Chicago are necessary to approve this Agreement and to consummate the
transactions contemplated hereby. This Agreement has been duly and validly
executed and delivered by First Chicago and (assuming due authorization,
execution and delivery by NBD) constitutes a valid and binding obligation of
First Chicago, enforceable against First Chicago in accordance with its terms.
(b) Neither the execution and delivery of this Agreement by First Chicago,
nor the consummation by First Chicago of the transactions contemplated hereby,
nor compliance by First Chicago with any of the terms or provisions hereof, will
(i) violate any provision of the Certificate of Incorporation or By-Laws of
First Chicago or (ii) assuming that the consents and approvals referred to in
Section 4.4 are duly obtained, (x) violate any statute, code, ordinance, rule,
regulation, judgment, order, writ, decree or injunction applicable to First
Chicago or any of its Subsidiaries or any of their respective properties or
assets, or (y) violate, conflict with, result in a breach of any provision of or
the loss of any benefit under, constitute a default (or an event which, with
notice or lapse of time, or both, would constitute a default) under, result in
the termination of or a right of termination or cancellation under, accelerate
the performance required by, or result in the creation of any Lien upon any of
the respective properties or assets of First Chicago or any of its Subsidiaries
under, any of the terms, conditions or provisions of any note, bond, mortgage,
indenture, deed of trust, license, lease, agreement or other instrument or
obligation to which First Chicago or any of its Subsidiaries is a party, or by
which they or any of their respective properties or assets may be bound or
affected, except (in the case of clause (y) above) for such violations,
conflicts, breaches or defaults which either individually or in the aggregate
will not have or be reasonably likely to have a Material Adverse Effect on First
Chicago.
4.4 Consents and Approvals. Except for (i) the filing of applications and
notices, as applicable, with the Federal Reserve Board under the BHC Act and
approval of such applications and notices, (ii) the State Approvals, (iii) the
filing with the SEC of the Joint Proxy Statement and the S-4, (iv) the filing of
the Certificate of Merger with the Delaware Secretary pursuant to the DGCL, (v)
any notices to or filings with the SBA, (vi) any consent, authorizations,
approvals, filings or exemptions in connection with compliance with the
applicable provisions of federal and state securities laws relating to the
regulation of broker-dealers or investment advisers, and federal commodities
laws relating to the regulation of futures commission merchants and the rules
and regulations thereunder and of any applicable
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SRO, and the rules of the NYSE, or which are required under consumer finance,
mortgage banking and other similar laws and (vii) the approval of this Agreement
by the requisite vote of the stockholders of First Chicago and NBD, no consents
or approvals of or filings or registrations with any Governmental Entity or with
any third party are necessary in connection with (A) the execution and delivery
by First Chicago of this Agreement and (B) the consummation by First Chicago of
the Merger and the other transactions contemplated hereby.
4.5 Reports. First Chicago and each of its Subsidiaries have timely filed
all reports, registrations and statements, together with any amendments required
to be made with respect thereto, that they were required to file since January
1, 1993 with the Regulatory Agencies, and all other reports and statements
required to be filed by them since January 1, 1993, including, without
limitation, any report or statement required to be filed pursuant to the laws,
rules or regulations of the United States, any state, or any Regulatory Agency
and have paid all fees and assessments due and payable in connection therewith,
except where the failure to file such report, registration or statement or to
pay such fees and assessments, either individually or in the aggregate, will not
have a Material Adverse Effect on First Chicago. Except for normal examinations
conducted by a Regulatory Agency in the regular course of the business of First
Chicago and its Subsidiaries, no Regulatory Agency has initiated any proceeding
or, to the best knowledge of First Chicago, investigation into the business or
operations of First Chicago or any of its Subsidiaries since January 1, 1993,
except where such proceedings or investigation are not likely, either
individually or in the aggregate, to have a Material Adverse Effect on First
Chicago. There is no unresolved violation, criticism, or exception by any
Regulatory Agency with respect to any report or statement relating to any
examinations of First Chicago or any of its Subsidiaries which, in the
reasonable judgment of First Chicago, is likely, either individually or in the
aggregate, to have a Material Adverse Effect on First Chicago.
4.6 Financial Statements. First Chicago has previously made availableto
NBD copies of (a) the consolidated balance sheets of First Chicago and its
Subsidiaries as of December 31, for the fiscal years 1993 and 1994, and the
related consolidated statements of income, changes in stockholders' equity and
cash flows for the fiscal years 1992 through 1994, inclusive, as reported in
First Chicago's Annual Report on Form 10-K for the fiscal year ended December
31, 1994 filed with the SEC under the Exchange Act, in each case accompanied by
the audit report of Arthur Andersen LLP, independent public accountants with
respect
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to First Chicago, and (b) the unaudited consolidated balance sheet of First
Chicago and its Subsidiaries as of March 31, 1994 and March 31, 1995 and the
related unaudited consolidated statements of income, cash flows and changes in
stockholders' equity for the three-month periods then ended as reported in First
Chicago's Quarterly Report on Form 10-Q for the period ended March 31, 1995
filed with the SEC under the Exchange Act (the "First Chicago March 31, 1995
Form 10-Q"). The December 31, 1994 consolidated balance sheet of First Chicago
(including the related notes, where applicable) fairly presents the consolidated
financial position of First Chicago and its Subsidiaries as of the date thereof,
and the other financial statements referred to in this Section 4.6 (including
the related notes, where applicable) fairly present (subject, in the case of the
unaudited statements, to recurring audit adjustments normal in nature and
amount) the results of the consolidated operations and changes in stockholders'
equity and consolidated financial position of First Chicago and its Subsidiaries
for the respective fiscal periods or as of the respective dates therein set
forth; each of such statements (including the related notes, where applicable)
comply in all material respects with applicable accounting requirements and with
the published rules and regulations of the SEC with respect thereto; and each of
such statements (including the related notes, where applicable) has been
prepared in all material respects in accordance with GAAP consistently applied
during the periods involved, except in each case as indicated in such statements
or in the notes thereto or, in the case of unaudited statements, as permitted by
Form 10-Q. The books and records of First Chicago and its Subsidiaries have
been, and are being, maintained in all material respects in accordance with GAAP
and any other applicable legal and accounting requirements and reflect only
actual transactions.
4.7 Broker's Fees. Neither First Chicago nor any First Chicago Subsidiary
nor any of their respective officers or directors has employed any broker or
finder or incurred any liability for any broker's fees, commissions or finder's
fees in connection with the Merger or related transactions contemplated by this
Agreement or the Option Agreements.
4.8 Absence of Certain Changes or Events. (a) Except as publicly
disclosed in First Chicago Reports (as defined in Section 4.12) filed prior to
the date hereof, since March 31, 1995, (i) First Chicago and its Subsidiaries
taken as a whole have not incurred any material liability, except in the
ordinary course of their business and (ii) no event has occurred which has had,
individually or in the aggregate, a Material Adverse Effect on First Chicago.
(b) Except as publicly disclosed in First Chicago Reports filed prior to
the date hereof, since March 31, 1995, First
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Chicago and its Subsidiaries have carried on their respective businesses in all
material respects in the ordinary and usual course.
(c) Since December 31, 1994, neither First Chicago nor any of its
Subsidiaries has (i) except for such actions as are in the ordinary course of
business consistent with past practice or except as required by applicable law,
(A) increased the wages, salaries, compensation, pension, or other fringe
benefits or perquisites payable to any executive officer, employee, or director
from the amount thereof in effect as of December 31, 1994, or (B) granted any
severance or termination pay, entered into any contract to make or grant any
severance or termination pay, or paid any bonuses aggregating in excess of 5% of
First Chicago's 1994 salary and employee benefit expenses, other than customary
year-end bonuses for fiscal 1994 and 1995, or (ii) suffered any strike, work
stoppage, slowdown, or other labor disturbance which, in the reasonable judgment
of First Chicago is likely, either individually or in the aggregate, to have a
Material Adverse Effect on First Chicago.
4.9 Legal Proceedings. (a) Neither First Chicago nor any of its
Subsidiaries is a party to any and there are no pending or, to the best of First
Chicago's knowledge, threatened, material legal, administrative, arbitral or
other proceedings, claims, actions or governmental or regulatory investigations
of any nature against First Chicago or any of its Subsidiaries or challenging
the validity or propriety of the transactions contemplated by this Agreement or
the First Chicago Option Agreement as to which there is a reasonable probability
of an adverse determination and which, if adversely determined, would,
individually or in the aggregate, have a Material Adverse Effect on First
Chicago.
(b) There is no injunction, order, judgment, decree, or regulatory
restriction (other than those that apply to similarly situated bank holding
companies or banks) imposed upon First Chicago, any of its Subsidiaries or the
assets of First Chicago or any of its Subsidiaries which has had, or might
reasonably be expected to have, a Material Adverse Effect on First Chicago or
the Surviving Corporation.
4.10 Taxes and Tax Returns. (a) Each of First Chicago and its Subsidiaries
has duly filed all federal, state, county, foreign and, to the best of First
Chicago's knowledge, local information returns and tax returns required to be
filed by it on or prior to the date hereof (all such returns being accurate and
complete in all material respects) and has duly paid or made provisions for the
payment of all Taxes and other governmental
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charges which have been incurred or are due or claimed to be due from it by
federal, state, county, foreign or local taxing authorities on or prior to the
date of this Agreement (including, without limitation, if and to the extent
applicable, those due in respect of its properties, income, business, capital
stock, deposits, franchises, licenses, sales and payrolls) other than (i) Taxes
or other charges which are not yet delinquent or are being contested in good
faith and have not been finally determined, or (ii) information returns, tax
returns, Taxes or other governmental charges the failure to file, pay or make
provision for, either individually or in the aggregate, is not likely, in the
reasonable judgment of First Chicago, to have a Material Adverse Effect on First
Chicago. The income tax returns of First Chicago and its Subsidiaries have been
examined by the IRS through 1991 and any liability with respect thereto has been
satisfied for all years to and including 1976, and either no material
deficiencies were asserted as a result of such examination for which First
Chicago does not have adequate reserves or all such deficiencies were satisfied.
To the best of First Chicago's knowledge, there are no material disputes
pending, or claims asserted for, Taxes or assessments upon First Chicago or any
of its Subsidiaries for which First Chicago does not have adequate reserves, nor
has First Chicago or any of its Subsidiaries given any currently effective
waivers extending the statutory period of limitation applicable to any federal,
state, county or local income tax return for any period. In addition, (A) proper
and accurate amounts have been withheld by First Chicago and its Subsidiaries
from their employees for all prior periods in compliance in all material
respects with the tax withholding provisions of applicable federal, state and
local laws, except where failure to do so would not have a Material Adverse
Effect on First Chicago, (B) federal, state, county and local returns which are
accurate and complete in all material respects have been filed by First Chicago
and its Subsidiaries for all periods for which returns were due with respect to
income tax withholding, Social Security and unemployment taxes, except where
failure to do so would not have a Material Adverse Effect on First Chicago, (C)
the amounts shown on such federal, state, local or county returns to be due and
payable have been paid in full or adequate provision therefor has been included
by First Chicago in its consolidated financial statements as of December 31,
1994, except where failure to do so would not have a Material Adverse Effect on
First Chicago and (D) there are no Tax liens upon any property or assets of
First Chicago or its Subsidiaries except liens for current taxes not yet due or
liens that would not have a Material Adverse Effect on First Chicago. Neither
First Chicago nor any of its Subsidiaries has been required to include in income
any adjustment pursuant to Section 481 of the Code by reason of a voluntary
change in accounting method initiated by First Chicago or any of its
Subsidiaries, and the IRS has not initiated or proposed any such adjustment or
change in ac-
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counting method, in either case, which has had or is reasonably likely to have a
Material Adverse Effect on First Chicago. Except as set forth in the financial
statements described in Section 4.6, neither First Chicago nor any of its
Subsidiaries has entered into a transaction which is being accounted for as an
installment obligation under Section 453 of the Code, which would be reasonably
likely to have a Material Adverse Effect on First Chicago.
(b) Any amount that is reasonably likely to be received (whether in cash or
property or the vesting of property) as a result of any of the transactions
contemplated by this Agreement by any employee, officer or director of First
Chicago or any of its affiliates who is a "Disqualified Individual" (as such
term is defined in proposed Treasury Regulation Section 1.280G-1) under any
employment, severance or termination agreement, other compensation arrangement
or First Chicago Benefit Plan currently in effect should not be characterized as
an "excess parachute payment" (as such term is defined in Section 280G(b)(1) of
the Code).
(c) No disallowance of a deduction under Section 162(m) of the Code for
employee remuneration of any amount paid or payable by First Chicago or any
Subsidiary of First Chicago under any contract, plan, program, arrangement or
understanding would be reasonably likely to have a Material Adverse Effect on
First Chicago.
4.11 Employees. (a) The First Chicago Disclosure Schedule sets forth a
true and complete list of each material employee benefit plan, arrangement or
agreement that is maintained as of the date of this Agreement (the "First
Chicago Benefit Plans") by First Chicago, any of its Subsidiaries or by any
trade or business, whether or not incorporated (a "First Chicago ERISA
Affiliate"), all of which together with First Chicago would be deemed a "single
employer" within the meaning of Section 4001 of ERISA.
(b) First Chicago has heretofore delivered to NBD true and complete copies
of each of the First Chicago Benefit Plans and certain related documents,
including, but not limited to, (i) the actuarial report for such First Chicago
Plan (if applicable) for each of the last two years, and (ii) the most recent
determination letter from the IRS (if applicable) for such First Chicago Plan.
(c) (i) Each of the First Chicago Benefit Plans has been operated and
administered in all material respects with applicable laws, including, but not
limited to, ERISA and the
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Code, (ii) each of the First Chicago Benefit Plans intended to be "qualified"
within the meaning of Section 401(a) of the Code is so qualified, (iii) with
respect to each First Chicago Plan which is subject to Title IV of ERISA, the
present value of accrued benefits under such First Chicago Plan, based upon the
actuarial assumptions used for funding purposes in the most recent actuarial
report prepared by such First Chicago Plan's actuary with respect to such First
Chicago Plan, did not, as of its latest valuation date, exceed the then current
value of the assets of such First Chicago Plan allocable to such accrued
benefits, (iv) no First Chicago Plan provides benefits, including, without
limitation, death or medical benefits (whether or not insured), with respect to
current or former employees of First Chicago, its Subsidiaries or any First
Chicago ERISA Affiliate beyond their retirement or other termination of service,
other than (A) coverage mandated by applicable law, (B) death benefits or
retirement benefits under any "employee pension plan" (as such term is defined
in Section 3(2) of ERISA), (C) deferred compensation benefits accrued as
liabilities on the books of First Chicago, its Subsidiaries or the First Chicago
ERISA Affiliates or (D) benefits the full cost of which is borne by the current
or former employee (or his beneficiary), (v) no material liability under Title
IV of ERISA has been incurred by First Chicago, its Subsidiaries or any First
Chicago ERISA Affiliate that has not been satisfied in full, and no condition
exists that presents a material risk to First Chicago, its Subsidiaries or any
First Chicago ERISA Affiliate of incurring a material liability thereunder, (vi)
no First Chicago Plan is a "multiemployer pension plan" (as such term is defined
in Section 3(37) of ERISA), (vii) all contributions or other amounts payable by
First Chicago or its Subsidiaries as of the Effective Time with respect to each
First Chicago Plan in respect of current or prior plan years have been paid or
accrued in accordance with GAAP and Section 412 of the Code, (viii) neither
First Chicago, its Subsidiaries nor any First Chicago ERISA Affiliate has
engaged in a transaction in connection with which First Chicago, its
Subsidiaries or any First Chicago ERISA Affiliate reasonably could be subject to
either a material civil penalty assessed pursuant to Section 409 or 502(i) of
ERISA or a material tax imposed pursuant to Section 4975 or 4976 of the Code,
and (ix) to the best knowledge of First Chicago there are no pending, threatened
or anticipated claims (other than routine claims for benefits) by, on behalf of
or against any of the First Chicago Benefit Plans or any trusts related thereto
which are, in the reasonable judgment of First Chicago, likely, either
individually or in the aggregate, to have a Material Adverse Effect on NBD.
(d) Neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby will (i) result in any
material payment (including, without limitation, severance, unemployment
compensation, golden para-
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chute or otherwise) becoming due to any director or any employee of First
Chicago or any of its affiliates from First Chicago or any of its affiliates
under any First Chicago Benefit Plan or otherwise, (ii) materially increase any
benefits otherwise payable under any First Chicago Benefit Plan or (iii) result
in any acceleration of the time of payment or vesting of any such benefits to
any material extent.
4.12 SEC Reports. First Chicago has previously made available to NBD an
accurate and complete copy of each (a) final registration statement, prospectus,
report, schedule and definitive proxy statement filed since January 1, 1993 by
First Chicago with the SEC pursuant to the Securities Act or the Exchange Act
(the "First Chicago Reports") and prior to the date hereof and (b) communication
mailed by First Chicago to its stockholders since January 1, 1993 and prior to
the date hereof, and no such registration statement, prospectus, report,
schedule, proxy statement or communication contained any untrue statement of a
material fact or omitted to state any material fact required to be stated
therein or necessary in order to make the statements therein, in light of the
circumstances in which they were made, not misleading, except that information
as of a later date shall be deemed to modify information as of an earlier date.
Since January 1, 1993, First Chicago has timely filed all First Chicago Reports
and other documents required to be filed by it under the Securities Act and the
Exchange Act, and, as of their respective dates, all First Chicago Reports
complied in all material respects with the published rules and regulations of
the SEC with respect thereto.
4.13 Compliance with Applicable Law. First Chicago and each of its
Subsidiaries hold all material licenses, franchises, permits and authorizations
necessary for the lawful conduct of their respective businesses under and
pursuant to all, and have complied in all material respects with and are not in
default in any material respect under any, applicable law, statute, order, rule,
regulation, policy and/or guideline of any Governmental Entity relating to First
Chicago or any of its Subsidiaries, except where the failure to hold such
license, franchise, permit or authorization or such noncompliance or default
would not, individually or in the aggregate, have a Material Adverse Effect on
First Chicago.
4.14 Certain Contracts. (a) Neither First Chicago nor any of its
Subsidiaries is a party to or bound by any contract, arrangement, commitment or
understanding (whether written or oral) (i) with respect to the employment of
any directors, officers or employees other than in the ordinary course of
business consistent with past practice, (ii) which, upon the con-
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summation of the transactions contemplated by this Agreement will (either alone
or upon the occurrence of any additional acts or events) result in any payment
(whether of severance pay or otherwise) becoming due from First Chicago, NBD,
the Surviving Corporation, or any of their respective Subsidiaries to any
officer or employee thereof, (iii) which is a "material contract" (as such term
is defined in Item 601(b)(10) of Regulation S-K of the SEC) to be performed
after the date of this Agreement that has not been filed or incorporated by
reference in the First Chicago Reports, (iv) which materially restricts the
conduct of any line of business by First Chicago, (v) with or to a labor union
or guild (including any collective bargaining agreement) or (vi) (including any
stock option plan, stock appreciation rights plan, restricted stock plan or
stock purchase plan) any of the benefits of which will be increased, or the
vesting of the benefits of which will be accelerated, by the occurrence of any
of the transactions contemplated by this Agreement, or the value of any of the
benefits of which will be calculated on the basis of any of the transactions
contemplated by this Agreement. First Chicago has previously made available to
NBD true and correct copies of all employment and deferred compensation
agreements which are in writing and to which First Chicago is a party. Each
contract, arrangement, commitment or understanding of the type described in this
Section 4.14(a), whether or not set forth in the First Chicago Disclosure
Schedule, is referred to herein as a "First Chicago Contract", and neither First
Chicago nor any of its Subsidiaries knows of, or has received notice of, any
violation of the above by any of the other parties thereto which, individually
or in the aggregate, would have a Material Adverse Effect on First Chicago.
(b) (i) Each First Chicago Contract is valid and binding on First Chicago
or any of its Subsidiaries, as applicable, and in full force and effect, (ii)
First Chicago and each of its Subsidiaries has in all material respects
performed all obligations required to be performed by it to date under each
First Chicago Contract, except where such noncompliance, individually or in the
aggregate, would not have a Material Adverse Effect on First Chicago, and (iii)
no event or condition exists which constitutes or, after notice or lapse of time
or both, would constitute, a material default on the part of First Chicago or
any of its Subsidiaries under any such First Chicago Contract, except where such
default, individually or in the aggregate, would not have a Material Adverse
Effect on First Chicago.
4.15 Agreements with Regulatory Agencies. Neither First Chicago nor any
of its Subsidiaries is subject to any cease-and-desist or other order issued by,
or is a party to any written agreement, consent agreement or memorandum of
understanding with, or is a party to any commitment letter or similar
undertaking to, or is subject to any order or directive by, or has been since
January 1, 1993, a recipient of any supervisory
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letter from, or since January 1, 1993, has adopted any board resolutions at the
request of any Regulatory Agency or other Governmental Entity that currently
restricts in any material respect the conduct of its business or that in any
material manner relates to its capital adequacy, its credit policies, its
management or its business (each, whether or not set forth in the First Chicago
Disclosure Schedule, a "First Chicago Regulatory Agreement"), nor has First
Chicago or any of its Subsidiaries been advised since January 1, 1993, by any
Regulatory Agency or other Governmental Entity that it is considering issuing or
requesting any such Regulatory Agreement.
4.16 Other Activities of First Chicago and its Subsidiaries.
(a) Neither First Chicago nor any of its Subsidiaries that is neither a
bank, a bank operating subsidiary or a bank service corporation, directly or
indirectly engages in any activity prohibited by the Federal Reserve Board.
Without limiting the generality of the foregoing, any equity investment of First
Chicago and each Subsidiary that is not a bank, a bank operating subsidiary or a
bank service corporation, is not prohibited by the Federal Reserve Board.
(b) To First Chicago's knowledge, each First Chicago Subsidiary which is a
bank (a "First Chicago Bank Subsidiary") currently performs all Trust Activities
with requisite authority under applicable law of Governmental Entities and in
accordance in all material respects with the agreed-upon terms of the agreements
and instruments governing such Trust Activities, sound fiduciary principles and
applicable law and regulation (specifically including, but not limited to,
Section 9 of Title 12 of the Code of Federal Regulations); there is no
investigation or inquiry by any Governmental Entity pending, or, to the
knowledge of First Chicago, threatened, against or affecting First Chicago or
any Significant Subsidiary thereof relating to the compliance by First Chicago
or any such Significant Subsidiary with sound fiduciary principles and
applicable regulations; and except where any such failure would not have a
Material Adverse Effect on First Chicago, each employee of a First Chicago Bank
Subsidiary had the authority to act in the capacity in which he or she acted
with respect to Trust Activities, in each case, in which such employee held
himself or herself out as a representative of a First Chicago Bank Subsidiary;
and each First Chicago Bank Subsidiary has established policies and procedures
for the purpose of complying with applicable laws of Governmental Entities
relating to Trust Activities, has followed such policies and procedures in all
material respects and has performed appropriate internal audit reviews of, and
has engaged
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independent accountants to perform audits of, Trust Activities, which audits
have disclosed no material violations of applicable laws of Governmental
Entities or such policies and procedures.
4.17 Investment Securities. Each of First Chicago and its Subsidiaries
has good and marketable title to all securities held by it (except securities
sold under repurchase agreements or held in any fiduciary or agency capacity),
free and clear of any Lien, except to the extent such securities are pledged in
the ordinary course of business consistent with prudent banking practice to
secure obligations of First Chicago or any of its Subsidiaries. Such securities
are valued on the books of First Chicago in accordance with GAAP.
4.18 Interest Rate Risk Management Instruments. All interest rate swaps,
caps, floors and option agreements and other interest rate risk management
arrangements, whether entered into for the account of First Chicago or for the
account of a customer of First Chicago or one of its Subsidiaries, were entered
into in the ordinary course of business and, to First Chicago's knowledge, in
accordance with prudent banking practice and applicable rules, regulations and
policies of any Regulatory Authority and with counterparties believed to be
financially responsible at the time and are legal, valid and binding obligations
of First Chicago or one of its Subsidiaries enforceable in accordance with their
terms (except as may be limited by bankruptcy, insolvency, moratorium,
reorganization or similar laws affecting the rights of creditors generally and
the availability of equitable remedies), and are in full force and effect.
First Chicago and each of its Subsidiaries has duly performed in all material
respects all of its material obligations thereunder to the extent that such
obligations to perform have accrued; and to First Chicago's knowledge, there are
no material breaches, violations or defaults or allegations or assertions of
such by any party thereunder.
4.19 Undisclosed Liabilities. Except for those liabilities that are fully
reflected or reserved against on the consolidated balance sheet of First Chicago
included in the First Chicago March 31, 1995 Form 10-Q and for liabilities
incurred in the ordinary course of business consistent with past practice, since
March 31, 1995, neither First Chicago nor any of its Subsidiaries has incurred
any liability of any nature whatsoever (whether absolute, accrued, contingent or
otherwise and whether due or to become due) that, either alone or when combined
with all similar liabilities, has had, or could reasonably be expected to have,
a Material Adverse Effect on First Chicago.
4.20 Environmental Liability. Except as set forth in the First Chicago
Disclosure Schedule, there are no legal, administrative, arbitral or other
proceedings, claims, actions, causes of action, private environmental
investigations or re-
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mediation activities or governmental investigations of any nature seeking to
impose, or that reasonably could result in the imposition, on First Chicago of
any liability or obligation arising under common law or under any local, state
or federal environmental statute, regulation or ordinance including, without
limitation, CERCLA, pending or threatened against First Chicago, which liability
or obligation could reasonably be expected to have a Material Adverse Effect on
First Chicago. To the knowledge of First Chicago, there is no reasonable basis
for any such proceeding, claim, action or governmental investigation that would
impose any material liability or obligation that could reasonably be expected to
have a Material Adverse Effect on First Chicago. First Chicago is not subject to
any agreement, order, judgment, decree, letter or memorandum by or with any
court, governmental authority, regulatory agency or third party imposing any
material liability or obligation that could reasonably be expected to have a
Material Adverse Effect on First Chicago.
4.21 State Takeover Laws. The Board of Directors of First Chicago has
approved the transactions contemplated by this Agreement and the Option
Agreements such that the provisions of Section 203 of the DGCL will not apply to
this Agreement or the Option Agreements or any of the transactions contemplated
hereby or thereby.
4.22 Rights Agreement. First Chicago has taken all action (including, if
required, redeeming all of the outstanding preferred stock purchase rights
issued pursuant to the First Chicago Rights Agreement or amending or terminating
the First Chicago Rights Agreement) so that the entering into of this Agreement
and the Option Agreements, the Merger, the acquisition of shares pursuant to the
Option Agreements and the other transactions contemplated hereby and thereby do
not and will not result in the grant of any rights to any person under the First
Chicago Rights Agreement or enable or require the First Chicago Rights to be
exercised, distributed or triggered.
4.23 Pooling of Interests. As of the date of this Agreement, First
Chicago has no reason to believe that the Merger will not qualify as a "pooling
of interests" for accounting purposes.
5.
ARTICLE V
COVENANTS RELATING TO CONDUCT OF BUSINESS
5.1 Conduct of Businesses Prior to the Effective Time.
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During the period from the date of this Agreement to the Effective Time, except
as expressly contemplated or permitted by this Agreement (including the NBD
Disclosure Schedule and the First Chicago Disclosure Schedule) or the Option
Agreements, each of First Chicago and NBD shall, and shall cause each of their
respective Subsidiaries to, (a) conduct its business in the usual, regular and
ordinary course consistent with past practice, (b) use reasonable best efforts
to maintain and preserve intact its business organization, employees and
advantageous business relationships and retain the services of its key officers
and key employees and (c) take no action which would adversely affect or delay
the ability of either First Chicago or NBD to obtain any necessary approvals of
any Regulatory Agency or other governmental authority required for the
transactions contemplated hereby or to perform its covenants and agreements
under this Agreement or the Option Agreements.
5.2 Forbearances. During the period from the date of this Agreement to the
Effective Time, except as set forth in the First Chicago Disclosure Schedule or
the NBD Disclosure Schedule, as the case may be, and, except as expressly
contemplated or permitted by this Agreement or the Option Agreements, neither
First Chicago nor NBD shall, and neither First Chicago nor NBD shall permit any
of their respective Subsidiaries to, without the prior written consent of the
other:
(a) other than in the ordinary course of business consistent with past
practice, incur any indebtedness for borrowed money (other than short-term
indebtedness incurred to refinance short-term indebtedness and indebtedness of
NBD or any of its Subsidiaries to NBD or any of its Subsidiaries, on the one
hand, or of First Chicago or any of its Subsidiaries to First Chicago or any of
its Subsidiaries, on the other hand), assume, guarantee, endorse or otherwise as
an accommodation become responsible for the obligations of any other individual,
corporation or other entity, or make any loan or advance (it being understood
and agreed that incurrence of indebtedness in the ordinary course of business
shall include, without limitation, the creation of deposit liabilities,
purchases of Federal funds, sales of certificates of deposit and entering into
repurchase agreements);
(b) (i) adjust, split, combine or reclassify any capital stock; (ii) make,
declare or pay any dividend or make any other distribution on, or directly or
indirectly redeem, purchase or otherwise acquire, any shares of its capital
stock or any securities or obligations convertible into or exchangeable for any
shares of its capital stock (except, (A) in the case of NBD, for regular
quarterly cash dividends at a rate not in excess of $.33 per share of NBD
Common Stock, (B) in the case of First Chicago, for regular
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quarterly cash dividends on First Chicago Common Stock at a rate not in excess
of $.60 per share of First Chicago Common Stock, (C) in the case of First
Chicago Preferred Stock, for regular quarterly or semiannual cash dividends
thereon at the rates set forth in the applicable certificate of incorporation or
certificate of designation for such securities and except for dividends paid by
any of the Subsidiaries of each of First Chicago and NBD to First Chicago or NBD
or any of their Subsidiaries, respectively, and (D) except for dividends paid in
the ordinary course of business by any subsidiaries (whether or not wholly
owned) of each of First Chicago and NBD), (iii) grant any stock appreciation
rights or grant any individual, corporation or other entity any right to acquire
any shares of its capital stock (except for options to purchase stock granted in
the ordinary course of business consistent with past practice pursuant to the
First Chicago Stock Plans, the First Chicago ESPSP, and the NBD Stock Plans) or
(iv) issue any additional shares of capital stock except pursuant to (A) the
exercise of stock options or warrants outstanding as of the date hereof, (B) the
First Chicago Convertible Preferred Stock, (C) the Option Agreements, (D) the
First Chicago Rights Agreement, (E) the First Chicago DRIP, or (F) the First
Chicago ESPSP;
(c) sell, transfer, mortgage, encumber or otherwise dispose of any of its
properties or assets to any individual, corporation or other entity other than a
Subsidiary, or cancel, release or assign any indebtedness to any such person or
any claims held by any such person, except in the ordinary course of business
consistent with past practice or pursuant to contracts or agreements in force at
the date of this Agreement;
(d) except for transactions in the ordinary course of business consistent
with past practice or pursuant to contracts or agreements in force at the date
of this Agreement, make any material investment either by purchase of stock or
securities, contributions to capital, property transfers, or purchase of any
property or assets of any other individual, corporation or other entity other
than a Subsidiary thereof;
(e) except for transactions in the ordinary course of business consistent
with past practice, enter into or terminate any material contract or agreement,
or make any change in any of its material leases or contracts, other than
renewals of contracts and leases without material adverse changes of terms;
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(f) increase in any manner the compensation or fringe benefits of any of its
employees or pay any pension or retirement allowance not required by any
existing plan or agreement to any such employees or become a party to, amend or
commit itself to any pension, retirement, profit-sharing or welfare benefit plan
or agreement or employment agreement with or for the benefit of any employee
other than in the ordinary course of business consistent with past practice or
accelerate the vesting of any stock options or other stock-based compensation;
(g) solicit, encourage or authorize any individual, corporation or other
entity to solicit from any third party any inquiries or proposals relating to
the disposition of its business or assets, or the acquisition of its voting
securities, or the merger of it or any of its Subsidiaries with any corporation
or other entity other than as provided by this Agreement (and each party shall
promptly notify the other of all of the relevant details relating to all
inquiries and proposals which it may receive relating to any of such matters);
(h) settle any claim, action or proceeding involving money damages, except in
the ordinary course of business consistent with past practice;
(i) take any action that would prevent or impede the Merger from qualifying
(i) for "pooling of interests" accounting treatment or (ii) as a reorganization
within the meaning of Section 368 of the Code; provided, however, that nothing
-------- -------
contained herein shall limit the ability of First Chicago or NBD to exercise its
rights under the NBD Option Agreement or the First Chicago Option Agreement, as
the case may be;
(j) amend its certificate of incorporation or articles of incorporation, as
the case may be, or its bylaws; or
(k) other than in prior consultation with the other party to this Agreement,
restructure or materially change its investment securities portfolio or its gap
position, through purchases, sales or otherwise, or the manner in which the
portfolio is classified or reported;
(l) take any action that is intended or may reasonably be expected to result
in any of its representations and warranties set forth in this Agreement being
or becoming untrue in any material respect at any time prior to the Effective
Time, or in any of the conditions to the Merger set forth in Article VII not
being satisfied or in a violation of any provision of this Agreement, except, in
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every case, as may be required by applicable law; or
(m) agree to, or make any commitment to, take any of the actions prohibited
by this Section 5.2.
6.
ARTICLE VI
ADDITIONAL AGREEMENTS
6.1 Regulatory Matters. (a) First Chicago and NBD shall promptly prepare and
file with the SEC the Joint Proxy Statement and NBD shall promptly prepare and
file with the SEC the S-4, in which the Joint Proxy Statement will be included
as a prospectus. Each of First Chicago and NBD shall use all reasonable efforts
to have the S-4 declared effective under the Securities Act as promptly as
practicable after such filing, and First Chicago and NBD shall thereafter mail
or deliver the Joint Proxy Statement to their respective stockholders. NBD shall
also use all reasonable efforts to obtain all necessary state securities law or
"Blue Sky" permits and approvals required to carry out the transactions
contemplated by this Agreement, and First Chicago shall furnish all information
concerning First Chicago and the holders of First Chicago Capital Stock as may
be reasonably requested in connection with any such action.
(b) The parties hereto shall cooperate with each other and use their best
efforts to promptly prepare and file all necessary documentation, to effect all
applications, notices, petitions and filings, to obtain as promptly as
practicable all permits, consents, approvals and authorizations of all third
parties and Governmental Entities which are necessary or advisable to consummate
the transactions contemplated by this Agreement (including, without limitation,
the Merger), and to comply with the terms and conditions of all such permits,
consents, approvals and authorizations of all such Governmental Entities. First
Chicago and NBD shall have the right to review in advance, and, to the extent
practicable, each will consult the other on, in each case subject to applicable
laws relating to the exchange of information, all the information relating to
NBD or First Chicago, as the case may be, and any of their respective
Subsidiaries, which appear in any filing made with, or written materials
submitted to, any third party or any Governmental Entity in connection with the
transactions contemplated by this Agreement. In exercising the foregoing right,
each of the parties hereto shall act reasonably and as promptly as practicable.
The parties hereto agree that they will consult with each other with respect to
the obtaining of all permits,
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consents, approvals and authorizations of all third parties and Governmental
Entities necessary or advisable to consummate the transactions contemplated by
this Agreement and each party will keep the other apprised of the status of
matters relating to completion of the transactions contemplated herein.
(c) First Chicago and NBD shall, upon request, furnish each other with all
information concerning themselves, their Subsidiaries, directors, officers and
stockholders and such other matters as may be reasonably necessary or advisable
in connection with the Joint Proxy Statement, the S-4 or any other statement,
filing, notice or application made by or on behalf of First Chicago, NBD or any
of their respective Subsidiaries to any Governmental Entity in connection with
the Merger and the other transactions contemplated by this Agreement.
(d) First Chicago and NBD shall promptly advise each other upon receiving any
communication from any Governmental Entity whose consent or approval is required
for consummation of the transactions contemplated by this Agreement which causes
such party to believe that there is a reasonable likelihood that any Requisite
Regulatory Approval will not be obtained or that the receipt of any such
approval will be materially delayed.
6.2 Access to Information. (a) Upon reasonable notice and subject to
applicable laws relating to the exchange of information, each of First Chicago
and NBD shall, and shall cause each of their respective Subsidiaries to, afford
to the officers, employees, accountants, counsel and other representatives of
the other party, access, during normal business hours during the period prior to
the Effective Time, to all its properties, books, contracts, commitments and
records and, during such period, each of First Chicago and NBD shall, and shall
cause their respective Subsidiaries to, make available to the other party (i) a
copy of each report, schedule, registration statement and other document filed
or received by it during such period pursuant to the requirements of federal
securities laws or federal or state banking laws, savings and loan or savings
association laws (other than reports or documents which First Chicago or NBD, as
the case may be, is not permitted to disclose under applicable law) and (ii) all
other information concerning its business, properties and personnel as such
party may reasonably request. Neither First Chicago nor NBD nor any of their
respective Subsidiaries shall be required to provide access to or to disclose
information where such access or disclosure would violate or prejudice the
rights of First Chicago's or NBD's, as the case may be, customers, jeopardize
the attorney-client privilege of the institution in possession or control of
such information or contravene any law, rule, regulation, order, judgment,
decree, fiduciary duty or binding agreement entered into prior to the date of
this Agreement. The parties hereto will make appropriate substitute disclosure
arrangements under
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circumstances in which the restrictions of the preceding sentence apply.
(b) Each of First Chicago and NBD shall hold all information furnished by or
on behalf of the other party or any of such party's Subsidiaries or
representatives pursuant to Section 6.2(a) in confidence to the extent required
by, and in accordance with, the provisions of the confidentiality agreement,
dated June 25, 1995, between First Chicago and NBD (the "Confidentiality
Agreement").
(c) No investigation by either of the parties or their respective
representatives shall affect the representations and warranties of the other set
forth herein.
6.3 Stockholders' Approvals. Each of First Chicago and NBD shall call a
meeting of its stockholders to be held as soon as reasonably practicable for the
purpose of voting upon the requisite stockholder approvals required in
connection with this Agreement and the Merger, and each shall use its best
efforts to cause such meetings to occur on the same date.
6.4 Legal Conditions to Merger. Each of First Chicago and NBD shall, and
shall cause its Subsidiaries to, use their best efforts (a) to take, or cause to
be taken, all actions necessary, proper or advisable to comply promptly with all
legal requirements which may be imposed on such party or its Subsidiaries with
respect to the Merger and, subject to the conditions set forth in Article VII
hereof, to consummate the transactions contemplated by this Agreement and (b) to
obtain (and to cooperate with the other party to obtain) any consent,
authorization, order or approval of, or any exemption by, any Governmental
Entity and any other third party which is required to be obtained by NBD or
First Chicago or any of their respective Subsidiaries in connection with the
Merger and the other transactions contemplated by this Agreement.
6.5 Affiliates; Publication of Combined Financial Results. (a) Each of
First Chicago and NBD shall use its best efforts to cause each director,
executive officer and other person who is an "affiliate" (for purposes of Rule
145 under the Securities Act and for purposes of qualifying the Merger for
"pooling of interests" accounting treatment) of such party to deliver to the
other party hereto, as soon as practicable after the date of this Agreement, and
prior to the date of the stockholders meetings called by First Chicago and NBD
to approve this Agreement, a written agreement, in the form of Exhibit 6.5(a)(1)
or (2), as applicable, hereto, providing that such person will not sell, pledge,
transfer or otherwise dispose of any shares of
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First Chicago Capital Stock or NBD Capital Stock held by such "affiliate" and,
in the case of the "affiliates" of First Chicago, the shares of NBD Capital
Stock to be received by such "affiliate" in the Merger: (i) in the case of
shares of NBD Capital Stock to be received by "affiliates" of First Chicago in
the Merger, except in compliance with the applicable provisions of the
Securities Act and the rules and regulations thereunder; and (ii) except to the
extent and under the conditions permitted therein, during the period commencing
30 days prior to the Merger and ending at the time of the publication of
financial results covering at least 30 days of combined operations of First
Chicago and NBD.
(b) The Surviving Corporation shall use its best efforts to publish as
promptly as reasonably practical but in no event later than 90 days after the
end of the first month after the Effective Time in which there are at least 30
days of post-Merger combined operations (which month may be the month in which
the Effective Time occurs), combined sales and net income figures as
contemplated by and in accordance with the terms of SEC Accounting Series
Release No. 135.
6.6 Stock Exchange Listing. NBD shall cause the shares of NBD Common Stock
to be issued in the Merger to be approved for listing on the NYSE, subject to
official notice of issuance, prior to the Effective Time and shall use its best
efforts to cause the shares of NBD Preferred Stock to be so approved.
6.7 Employee Benefit Plans. (a) From and after the Effective Time, unless
otherwise mutually determined, the NBD Benefit Plans and First Chicago Benefit
Plans in effect as of the date of this Agreement shall remain in effect with
respect to employees of NBD or First Chicago (or their Subsidiaries) covered by
such plans at the Effective Time until such time as the Surviving Corporation
shall, subject to applicable law, the terms of this Agreement and the terms of
such plans, adopt new benefit plans with respect to employees of the Surviving
Corporation and its Subsidiaries (the "New Benefit Plans"). Prior to the
Closing Date, NBD and First Chicago shall cooperate in reviewing, evaluating and
analyzing the First Chicago Benefit Plans and NBD Benefit Plans with a view
towards developing appropriate New Benefit Plans for the employees covered
thereby subsequent to the Merger. It is the intention of NBD and First Chicago
to develop New Benefit Plans, effective as of the Effective Time, which, among
other things, (i) treat similarly situated employees on a substantially
equivalent basis, taking into account all relevant factors, including, without
limitation, duties, geographic location, tenure, qualifications and abilities,
and (ii) do not discriminate between employees of the Surviving Corporation who
were covered by NBD Benefit Plans, on the one hand, and those covered by First
Chicago Benefit Plans, on the other, at the Effective Time.
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(b) The foregoing nothwithstanding, the Surviving Corporation agrees to
honor in accordance with their terms all benefits vested as of the date hereof
under the First Chicago Benefit Plans or the NBD Benefit Plans or under other
contracts, arrangements, commitments, or understandings described in the First
Chicago Disclosure Schedule and the NBD Disclosure Schedule.
(c) Nothing in this Section 6.7 shall be interpreted as preventing the
Surviving Corporation from amending, modifying or terminating any First Chicago
Benefit Plans, NBD Benefit Plans, or other contracts, arrangements, commitments
or understandings, in accordance with their terms and applicable law.
(d) NBD and First Chicago shall take all actions necessary, including
securing the consent of optionees, to amend the terms of NBD Benefits Plans
pursuant to which options to purchase NBD Common Stock have been issued or
granted ("NBD Stock Plans") and the First Chicago Stock Plans and any severance
or other agreements that provide for the surrender of stock options issued
thereunder in exchange for a cash payment ("LSARs") as a result of or in
connection with the Merger to provide that such LSARs shall be settled in stock
with a fair market value equal to the cash that would otherwise have been
payable thereunder.
6.8 Indemnification; Directors' and Officers' Insurance. (a) In the event
of any threatened or actual claim, action, suit, proceeding or investigation,
whether civil, criminal or administrative, including, without limitation, any
such claim, action, suit, proceeding or investigation in which any individual
who is now, or has been at any time prior to the date of this Agreement, or who
becomes prior to the Effective Time, a director or officer or employee of First
Chicago or any of its Subsidiaries, including any entity specified in the First
Chicago Disclosure Schedule (the "Indemnified Parties"), is, or is threatened to
be, made a party based in whole or in part on, or arising in whole or in part
out of, or pertaining to (i) the fact that he is or was a director, officer or
employee of First Chicago, any of the First Chicago Subsidiaries or any entity
specified in the First Chicago Disclosure Schedule or any of their respective
predecessors or (ii) this Agreement, the Option Agreements or any of the
transactions contemplated hereby or thereby, whether in any case asserted or
arising before or after the Effective Time, the parties hereto agree to
cooperate and use their best efforts to defend against and respond thereto. It
is understood and agreed that after the Effective Time, NBD shall indemnify and
hold harmless, as and to the fullest extent permitted by law, each such
Indemnified Party against any losses, claims, damages, liabilities, costs,
expenses (including
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reasonable attorney's fees and expenses in advance of the final disposition of
any claim, suit, proceeding or investigation to each Indemnified Party to the
fullest extent permitted by law upon receipt of any undertaking required by
applicable law), judgments, fines and amounts paid in settlement in connection
with any such threatened or actual claim, action, suit, proceeding or
investigation, and in the event of any such threatened or actual claim, action,
suit, proceeding or investigation (whether asserted of arising before or after
the Effective Time), the Indemnified Parties may retain counsel reasonably
satisfactory to them after consultation with NBD; provided, however,
-------- -------
that (A) NBD shall have the right to assume the defense thereof and upon such
assumption NBD shall not be liable to any Indemnified Party for any legal
expenses of other counsel or any other expenses subsequently incurred by any
Indemnified Party in connection with the defense thereof, except that if NBD
elects not to assume such defense or counsel for the Indemnified Parties
reasonably advises the Indemnified Parties that there are issues which raise
conflicts of interest between NBD and the Indemnified Parties, the Indemnified
Parties may retain counsel reasonably satisfactory to them after consultation
with NBD, and NBD shall pay the reasonable fees and expenses of such counsel for
the Indemnified Parties, (B) NBD shall be obligated pursuant to this paragraph
to pay for only one firm of counsel for all Indemnified Parties, unless an
Indemnified Party shall have reasonably concluded, based on the advice of
counsel, that in order to be adequately represented, separate counsel is
necessary for such Indemnified Party, in which case, NBD shall be obligated to
pay for such separate counsel, (C) NBD shall not be liable for any settlement
effected without its prior written consent (which consent shall not be
unreasonably withheld) and (D) NBD shall have no obligation hereunder to any
Indemnified Party when and if a court of competent jurisdiction shall ultimately
determine, and such determination shall have become final and nonappealable,
that indemnification of such Indemnified Party in the manner contemplated hereby
is prohibited by applicable law. Any Indemnified Party wishing to claim
Indemnification under this Section 6.8, upon learning of any such claim, action,
suit, proceeding or investigation, shall notify NBD thereof, provided that the
failure to so notify shall not affect the obligations of NBD under this Section
6.8 except to the extent such failure to notify materially prejudices NBD. NBD's
obligations under this Section 6.8 continue in full force and effect for a
period of six years from the Effective Time (or the period of the applicable
statute of limitations, if longer); provided, however, that all rights to
-------- -------
indemnification in respect of any claim (a "Claim") asserted or made within such
period shall continue until the final disposition of such Claim.
(b) NBD shall use its best efforts to cause the individuals serving as
officers and directors of First Chicago, its Subsidiaries or any entity
specified in the First Chicago
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Disclosure Schedule immediately prior to the Effective Time to be covered for a
period of six (6) years from the Effective Time (or the period of the applicable
statute of limitations, if longer) by the directors' and officers' liability
insurance policy maintained by First Chicago (provided that NBD may substitute
--------
therefor policies of at least the same coverage and amounts containing terms and
conditions which are not less advantageous than such policy) with respect to
acts or omissions occurring prior to the Effective Time which were committed by
such officers and directors in their capacity as such; provided, however, that
-------- -------
in no event shall NBD be required to expend more than 200% of the current amount
expended by First Chicago (the "Insurance Amount") to maintain or procure
insurance coverage pursuant hereto and provided further that if NBD is unable to
maintain or obtain the insurance called for by this Section 6.8(b), NBD shall
use its best efforts to obtain as much comparable insurance as available for the
Insurance Amount.
(c) In the event NBD or any of its successors or assigns (i) consolidates
with or merges into any other person and shall not be the continuing or
surviving corporation or entity of such consolidation or merger, or (ii)
transfers or conveys all or substantially all of its properties and assets to
any person, then, and in each such case, to the extent necessary, proper
provision shall be made so that the successors and assigns of NBD assume the
obligations set forth in this section.
(d) The provisions of this Section 6.8 are intended to be for the benefit of,
and shall be enforceable by, each Indemnified Party and his or her heirs and
representatives.
6.9 Additional Agreements. In case at any time after the Effective Time any
further action is necessary or desirable to carry out the purposes of this
Agreement (including, without limitation, any merger between a Subsidiary of NBD
and a Subsidiary of First Chicago) or to vest the Surviving Corporation with
full title to all properties, assets, rights, approvals, immunities and
franchises of any of the parties to the Merger, the proper officers and
directors of each party to this Agreement and their respective Subsidiaries
shall take all such necessary action as may be reasonably requested by, and at
the sole expense of, NBD.
6.10 Advice of Changes. First Chicago and NBD shall promptly advise the
other party of any change or event having a Material Adverse Effect on it or
which it believes would or would be reasonably likely to cause or constitute a
material breach of any of its representations, warranties or covenants contained
herein.
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6.11 Dividends. After the date of this Agreement, each of First Chicago and
NBD shall coordinate with the other the declaration of any dividends in respect
of First Chicago Common Stock and NBD Common Stock and the record dates and
payment dates relating thereto, it being the intention of the parties hereto
that holders of First Chicago Common Stock or NBD Common Stock shall not receive
two dividends, or fail to receive one dividend, for any quarter with respect to
their shares of First Chicago Common Stock and/or NBD Common Stock and any
shares of NBD Capital Stock any such holder receives in exchange therefor in the
Merger.
7.
ARTICLE VII
CONDITIONS PRECEDENT
7.1 Conditions to Each Party's Obligation To Effect the Merger. The
respective obligation of each party to effect the Merger shall be subject to the
satisfaction at or prior to the Effective Time of the following conditions:
(a) Stockholder Approval. This Agreement and the transactions contemplated
hereby shall have been approved and adopted by the respective requisite
affirmative votes of the holders of NBD Common Stock and First Chicago Common
Stock entitled to vote thereon.
(b) NYSE Listing. The shares of NBD Common Stock which shall be issued to
the stockholders of First Chicago upon consummation of the Merger shall have
been authorized for listing on the NYSE, subject to official notice of issuance.
(c) Other Approvals. All regulatory approvals required to consummate the
transactions contemplated hereby shall have been obtained and shall remain in
full force and effect and all statutory waiting periods in respect thereof shall
have expired (all such approvals and the expiration of all such waiting periods
being referred to herein as the "Requisite Regulatory Approvals").
(d) S-4. The S-4 shall have become effective under the Securities Act and no
stop order suspending the effectiveness of the S-4 shall have been issued and no
proceedings for that purpose shall have been initiated or threatened by the SEC.
(e) No Injunctions or Restraints; Illegality. No order, injunction or decree
issued by any court or agency of competent jurisdiction or other legal restraint
or prohibition (an "Injunction") preventing the consummation
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of the Merger or any of the other transactions contemplated by this Agreement
shall be in effect. No statute, rule, regulation, order, injunction or decree
shall have been enacted, entered, promulgated or enforced by any Governmental
Entity which prohibits, materially restricts or makes illegal consummation of
the Merger.
(f) Federal Tax Opinion. First Chicago and NBD each shall have received an
opinion of Wachtell, Lipton, Rosen & Katz, in form and substance reasonably
satisfactory to First Chicago and NBD, dated as of the Effective Time,
substantially to the effect that, on the basis of facts, representations and
assumptions set forth in such opinion which are consistent with the state of
facts existing at the Effective Time:
(i) The Merger will constitute a tax free reorganization under Section
368(a)(1)(A) of the Code and First Chicago and NBD will each be a party to the
reorganization;
(ii) No gain or loss will be recognized by First Chicago or NBD as a
result of the Merger;
(iii) No gain or loss will be recognized by the stockholders of First
Chicago who exchange their First Chicago Capital Stock solely for NBD Capital
Stock pursuant to the Merger (except with respect to cash received in lieu of a
fractional share interest in NBD Capital Stock);
(iv) The tax basis of the NBD Capital Stock received by stockholders who
exchange all of their First Chicago Capital Stock solely for NBD Capital Stock
in the Merger will be the same as the tax basis of the First Chicago Capital
Stock surrendered in exchange therefor (reduced by any amount allocable to a
fractional share interest for which cash is received); and
(v) The holding period of NBD Capital Stock received by stockholders of
First Chicago in the Merger will include the period during which the shares of
First Chicago Capital Stock surrendered in exchange therefor were held;
provided, such First Chicago Capital Stock was held as a capital asset by the
holder of such First Chicago Capital Stock at the Effective Time.
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In rendering such opinion, counsel may require and rely upon
representations contained in certificates of officers of First Chicago, NBD and
others.
(g) Pooling of Interests. First Chicago and NBD shall each have received a
letter from their respective independent accountants addressed to NBD or First
Chicago, as the case may be, to the effect that the Merger will qualify for
"pooling of interests" accounting treatment.
7.2 Conditions to Obligations of First Chicago. The obligation of First
Chicago to effect the Merger is also subject to the satisfaction or waiver by
First Chicago at or prior to the Effective Time of the following conditions:
(a) Representations and Warranties. The representations and warranties of
NBD set forth in this Agreement shall be true and correct in all material
respects as of the date of this Agreement and (except to the extent such
representations and warranties speak as of an earlier date) as of the Closing
Date as though made on and as of the Closing Date. First Chicago shall have
received a certificate signed on behalf of NBD by the Chief Executive Officer
and the Chief Financial Officer of NBD to the foregoing effect.
(b) Performance of Obligations of NBD. NBD shall have performed in all
material respects all obligations required to be performed by it under this
Agreement at or prior to the Closing Date, and First Chicago shall have received
a certificate signed on behalf of NBD by the Chief Executive Officer and the
Chief Financial Officer of NBD to such effect.
7.3 Conditions to Obligations of NBD. The obligation of NBD to effect the
Merger is also subject to the satisfaction or waiver by NBD at or prior to the
Effective Time of the following conditions:
(a) Representations and Warranties. The representations and warranties of
First Chicago set forth in this Agreement shall be true and correct in all
material respects as of the date of this Agreement and (except to the extent
such representations and warranties speak as of an earlier date) as of the
Closing Date as though made on and as of the Closing Date. NBD shall have
received a certificate signed on behalf of First Chicago by the Chief Executive
Officer and the Chief Financial Officer of First Chicago to the foregoing
effect.
(b) Performance of Obligations of First Chicago. First Chicago shall have
performed in all material respects
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all obligations required to be performed by it under this Agreement at or prior
to the Closing Date, and NBD shall have received a certificate signed on behalf
of First Chicago by the Chief Executive Officer and the Chief Financial Officer
of First Chicago to such effect.
(c) First Chicago Rights Agreement. The rights issued pursuant to the
First Chicago Rights Agreement shall not have become nonredeemable, exercisable,
distributed or triggered pursuant to the terms of such agreement.
8.
ARTICLE VIII
TERMINATION AND AMENDMENT
8.1 Termination. This Agreement may be terminated at any time prior to the
Effective Time, whether before or after approval of the matters presented in
connection with the Merger by the stockholders of First Chicago or NBD:
(a) by mutual consent of First Chicago and NBD in a written instrument, if
the Board of Directors of each so determines by a vote of a majority of the
members of its entire Board;
(b) by either the Board of Directors of First Chicago or the Board of
Directors of NBD if any Governmental Entity which must grant a Requisite
Regulatory Approval has denied approval of the Merger and such denial has become
final and nonappealable or any Governmental Entity of competent jurisdiction
shall have issued a final nonappealable order permanently enjoining or otherwise
prohibiting the consummation of the transactions contemplated by this Agreement;
(c) by either the Board of Directors of First Chicago or the Board of
Directors of NBD if the Merger shall not have been consummated on or before the
first anniversary of the date of this Agreement, unless the failure of the
Closing (as defined in Section 9.1) to occur by such date shall be due to the
failure of the party seeking to terminate this Agreement to perform or observe
the covenants and agreements of such party set forth herein;
(d) by either the Board of Directors of First Chicago or the Board of
Directors of NBD (provided that the terminating party is not then in material
breach of any representation, warranty, covenant or other agreement con-
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tained herein) if there shall have been a material breach of any of the
covenants or agreements or any of the representations or warranties set forth in
this Agreement on the part of the other party, which breach is not cured within
45 days following written notice to the party committing such breach, or which
breach, by its nature or timing, cannot be cured prior to the Closing Date; or
(e) by either First Chicago or NBD if any approval of the stockholders of
First Chicago or NBD required for the consummation of the Merger shall not have
been obtained by reason of the failure to obtain the required vote at a duly
held meeting of stockholders or at any adjournment or postponement thereof.
8.2 Effect of Termination. In the event of termination of this Agreement by
either First Chicago or NBD as provided in Section 8.1, this Agreement shall
forthwith become void and have no effect, and none of First Chicago, NBD, any of
their respective Subsidiaries or any of the officers or directors of any of them
shall have any liability of any nature whatsoever hereunder, or in connection
with the transactions contemplated hereby, except that (i) Sections 6.2(b), 8.2,
9.2 and 9.3, shall survive any termination of this Agreement, and (ii)
notwithstanding anything to the contrary contained in this Agreement, neither
First Chicago nor NBD shall be relieved or released from any liabilities or
damages arising out of its willful breach of any provision of this Agreement.
8.3 Amendment. Subject to compliance with applicable law, this Agreement
may be amended by the parties hereto, by action taken or authorized by their
respective Boards of Directors, at any time before or after approval of the
matters presented in connection with the Merger by the stockholders of NBD;
provided, however, that after any approval of the transactions contemplated by
- -------- -------
this Agreement by the respective stockholders of First Chicago or NBD, there may
not be, without further approval of such stockholders, any amendment of this
Agreement which changes the amount or the form of the consideration to be
delivered to the holders of First Chicago Common Stock hereunder other than as
contemplated by this Agreement. This Agreement may not be amended except by an
instrument in writing signed on behalf of each of the parties hereto.
8.4 Extension; Waiver. At any time prior to the Effective Time, the parties
hereto, by action taken or authorized by their respective Board of Directors,
may, to the extent legally allowed, (a) extend the time for the performance of
any of the obligations or other acts of the other parties hereto, (b) waive any
inaccuracies in the representations and warranties contained herein or in any
document delivered pursuant hereto and (c) waive compliance with any of the
agreements or conditions
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contained herein; provided, however, that after any approval of the transactions
-------- -------
contemplated by this Agreement by the respective stockholders of First Chicago
or NBD, there may not be, without further approval of such stockholders, any
extension or waiver of this Agreement or any portion thereof which reduces the
amount or changes the form of the consideration to be delivered to the holders
of First Chicago Common Stock hereunder other than as contemplated by this
Agreement. Any agreement on the part of a party hereto to any such extension or
waiver shall be valid only if set forth in a written instrument signed on behalf
of such party, but such extension or waiver or failure to insist on strict
compliance with an obligation, covenant, agreement or condition shall not
operate as a waiver of, or estoppel with respect to, any subsequent or other
failure.
9.
ARTICLE IX
GENERAL PROVISIONS
9.1 Closing. Subject to the terms and conditions of this Agreement and the
Option Agreements, the closing of the Merger (the "Closing") will take place at
10:00 a.m. on a date and at a place to be specified by the parties, which shall
be no later than five business days after the satisfaction or waiver (subject to
applicable law) of the latest to occur of the conditions set forth in Article
VII hereof, unless extended by mutual agreement of the parties (the "Closing
Date").
9.2 Nonsurvival of Representations, Warranties and Agreements. None of the
representations, warranties, covenants and agreements in this Agreement or in
any instrument delivered pursuant to this Agreement (other than pursuant to the
Option Agreements, which shall terminate in accordance with its terms) shall
survive the Effective Time, except for those covenants and agreements contained
herein and therein which by their terms apply in whole or in part after the
Effective Time.
9.3 Expenses. All costs and expenses incurred in connection with this
Agreement and the transactions contemplated hereby shall be paid by the party
incurring such expense, provided, however, that the costs and expenses of
printing and mailing the Joint Proxy Statement, and all filing and other fees
paid to the SEC in connection with the Merger, shall be borne equally by First
Chicago and NBD.
9.4 Notices. All notices and other communications hereunder shall be in
writing and shall be deemed given if delivered personally, telecopied (with
confirmation), mailed by registered
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or certified mail (return receipt requested) or delivered by an express courier
(with confirmation) to the parties at the following addresses (or at such other
address for a party as shall be specified by like notice):
(a) if to First Chicago, to:
First Chicago Corporation
One First National Plaza, Suite O276
Chicago, Illinois 60670
Attn: General Counsel
Fax: (312) 732-1069
and
(b) if to NBD, to:
NBD Bancorp, Inc.
611 Woodward Avenue
Detroit, Michigan 48226
Attn: General Counsel
Fax: (313) 225-2070
9.5 Interpretation. When a reference is made in this Agreement to Sections,
Exhibits or Schedules, such reference shall be to a Section of or Exhibit or
Schedule to this Agreement unless otherwise indicated. The table of contents
and headings contained in this Agreement are for reference purposes only and
shall not affect in any way the meaning or interpretation of this Agreement.
Whenever the words "include," "includes" or "including" are used in this
Agreement, they shall be deemed to be followed by the words "without
limitation". No provision of this Agreement shall be construed to require NBD,
First Chicago or any of their respective Subsidiaries or affiliates to take any
action which would violate any applicable law, rule or regulation.
9.6 Counterparts. This Agreement may be executed in counterparts, all of
which shall be considered one and the same agreement and shall become effective
when counterparts have been signed by each of the parties and delivered to the
other parties, it being understood that all parties need not sign the same
counterpart.
9.7 Entire Agreement. This Agreement (including the documents and the
instruments referred to herein) constitutes the entire agreement and supersedes
all prior agreements and understandings, both written and oral, among the
parties with respect to the subject matter hereof other than the Option
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Agreements and the Confidentiality Agreement.
9.8 Governing Law. This Agreement shall be governed and construed in
accordance with the laws of the State of Delaware, without regard to any
applicable conflicts of law.
9.9 Severability. Any term or provision of this Agreement which is invalid
or unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction. If any provision of
this Agreement is so broad as to be unenforceable, the provision shall be
interpreted to be only so broad as is enforceable.
9.10 Publicity. Except as otherwise required by applicable law or the rules
of the NYSE, neither First Chicago nor NBD shall, or shall permit any of its
Subsidiaries to, issue or cause the publication of any press release or other
public announcement with respect to, or otherwise make any public statement
concerning, the transactions contemplated by this Agreement without the consent
of the other party, which consent shall not be unreasonably withheld.
9.11 Assignment; Third Party Beneficiaries. Neither this Agreement nor any
of the rights, interests or obligations shall be assigned by any of the parties
hereto (whether by operation of law or otherwise) without the prior written
consent of the other parties. Subject to the preceding sentence, this Agreement
will be binding upon, inure to the benefit of and be enforceable by the parties
and their respective successors and assigns. Except as otherwise specifically
provided in Section 6.8, this Agreement (including the documents and instruments
referred to herein) is not intended to confer upon any person other than the
parties hereto any rights or remedies hereunder.
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IN WITNESS WHEREOF, First Chicago and NBD have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the date
first above written.
NBD BANCORP, INC. FIRST CHICAGO CORPORATION
By: /s/ Verne G. Istock By: /s/ Richard L. Thomas
------------------------ ----------------------
Verne G. Istock Richard L. Thomas
Chairman and Chairman and
Chief Executive Officer Chief Executive Officer
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EXHIBIT 99.2
STOCK OPTION AGREEMENT
THE TRANSFER OF THIS AGREEMENT IS SUBJECT TO
CERTAIN PROVISIONS CONTAINED HEREIN AND TO
RESALE RESTRICTIONS UNDER THE
SECURITIES ACT OF 1933, AS AMENDED
STOCK OPTION AGREEMENT, dated July 11, 1995, between FIRST CHICAGO
CORPORATION, a Delaware corporation ("Issuer"), and NBD BANCORP, INC., a
Delaware corporation ("Grantee").
W I T N E S S E T H:
-------------------
WHEREAS, Grantee and Issuer have entered into an Agreement and Plan of
Merger of even date herewith (the "Merger Agreement"), which agreement has been
executed by the parties hereto immediately prior to this Stock Option Agreement
(the "Agreement"); and
WHEREAS, as a condition to Grantee's entering into the Merger
Agreement and in consideration therefor, Issuer has agreed to grant Grantee the
Option (as hereinafter defined):
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements set forth herein and in the Merger Agreement, the
parties hereto agree as follows:
1. (a) Issuer hereby grants to Grantee an unconditional, irrevocable
option (the "Option") to purchase, subject to the terms hereof, up to 17,854,000
fully paid and nonassessable shares of Issuer's Common Stock, par value $5.00
per share (together with any associated preferred share purchase rights, "Common
Stock"), at a price of $ 60-1/8 per share (the "Option Price"); provided,
--------
however, that in no event shall the number of shares of Common Stock for which
- -------
this Option is exercisable exceed 19.9% of the Issuer's issued and outstanding
shares of Common Stock without giving effect to any shares subject to or issued
pursuant to the Option. The number of shares of Common Stock that may be
received upon the exercise of the Option and the Option Price are subject to
adjustment as herein set forth.
(b) In the event that any additional shares of Common Stock are
either (i) issued or otherwise become outstanding after the date of this
Agreement (other than pursuant to this Agreement) or (ii) redeemed, repurchased,
retired or otherwise cease to be outstanding after the date of
<PAGE>
the Agreement, the number of shares of Common Stock subject to the Option shall
be increased or decreased, as appropriate, so that, after such issuance, such
number equals 19.9% of the number of shares of Common Stock then issued and
outstanding without giving effect to any shares subject or issued pursuant to
the Option. Nothing contained in this Section 1(b) or elsewhere in this
Agreement shall be deemed to authorize Issuer or Grantee to breach any provision
of the Merger Agreement.
2. (a) The Holder (as hereinafter defined) may exercise the Option,
in whole or part, and from time to time, if, but only if, both an Initial
Triggering Event (as hereinafter defined) and a Subsequent Triggering Event (as
hereinafter defined) shall have occurred prior to the occurrence of an Exercise
Termination Event (as hereinafter defined), provided that the Holder shall have
--------
sent the written notice of such exercise (as provided in subsection (e) of this
Section 2) within 90 days following such Subsequent Triggering Event. Each of
the following shall be an Exercise Termination Event: (i) the Effective Time
(as defined in the Merger Agreement) of the Merger; (ii) termination of the
Merger Agreement in accordance with the provisions thereof if such termination
occurs prior to the occurrence of an Initial Triggering Event except a
termination by Grantee pursuant to Section 8.1(d) of the Merger Agreement
(unless the breach by Issuer giving rise to such right of termination is non-
volitional); or (iii) the passage of 12 months after termination of the Merger
Agreement if such termination follows the occurrence of an Initial Triggering
Event or is a termination by Grantee pursuant to Section 8.1(d) of the Merger
Agreement (unless the breach by Issuer giving rise to such right of termination
is non-volitional) (provided that if an Initial Triggering Event continues or
--------
occurs beyond such termination and prior to the passage of such 12-month period,
the Exercise Termination Event shall be 12 months from the expiration of the
Last Triggering Event but in no event more than 18 months after such
termination). The "Last Triggering Event" shall mean the last Initial
Triggering Event to expire. The term "Holder" shall mean the holder or holders
of the Option.
(b) The term "Initial Triggering Event" shall mean any of the
following events or transactions occurring after the date hereof:
(i) Issuer or any of its Subsidiaries (each an "Issuer
Subsidiary"), without having received Grantee's prior written consent,
shall have entered into an agreement to engage in an Acquisition
Transaction (as hereinafter defined) with any person (the term "person" for
purposes of this Agreement having the meaning assigned thereto in Sections
3(a)(9) and 13(d)(3) of the
-2-
<PAGE>
Securities Exchange Act of 1934, as amended (the "1934 Act"), and the rules and
regulations thereunder) other than Grantee or any of its Subsidiaries (each a
"Grantee Subsidiary") or the Board of Directors of Issuer shall have recommended
that the stockholders of Issuer approve or accept any Acquisition Transaction.
For purposes of this Agreement, "Acquisition Transaction" shall mean (w) a
merger or consolidation, or any similar transaction, involving Issuer or any
Significant Subsidiary (as defined in Rule 1-02 of Regulation S-X promulgated by
the Securities and Exchange Commission (the "SEC")) of Issuer, (x) a purchase,
lease or other acquisition or assumption of all or a substantial portion of the
assets or deposits of Issuer or any Significant Subsidiary of Issuer, (y) a
purchase or other acquisition (including by way of merger, consolidation, share
exchange or otherwise) of securities representing 10% or more of the voting
power of Issuer, or (z) any substantially similar transaction;
provided, however, that in no event shall any merger, consolidation, purchase or
- -------- -------
similar transaction involving only the Issuer and one or more of its
Subsidiaries or involving only any two or more of such Subsidiaries, be deemed
to be an Acquisition Transaction, provided that any such transaction is not
entered into in violation of the terms of the Merger Agreement; and provided,
--------
further, that any transaction described in this sentence that is expressly
- -------
permitted by the the Merger Agreement shall not be deemed to be an Acquisition
Transaction;
(ii) Issuer or any Issuer Subsidiary, without having received
Grantee's prior written consent, shall have authorized, recommended, proposed or
publicly announced its intention to authorize, recommend or propose, to engage
in an Acquisition Transaction with any person other than Grantee or a Grantee
Subsidiary, or the Board of Directors of Issuer shall have publicly withdrawn or
modified, or publicly announced its interest to withdraw or modify, in any
manner adverse to Grantee, its recommendation that the stockholders of Issuer
approve the transactions contemplated by the Merger Agreement;
(iii) Any person other than Grantee, any Grantee Subsidiary or
any Issuer Subsidiary acting in a fiduciary capacity in the ordinary course of
its business (and other than any person who (a) as of the date hereof
beneficially owns 10% or more of the outstanding shares of Common Stock and (b)
would be eligible to use Schedule
-3-
<PAGE>
13G but for the fact that such person owns 10% or more of the outstanding shares
of Common Stock) shall have acquired beneficial ownership or the right to
acquire beneficial ownership of 10% or more of the outstanding shares of Common
Stock (the term "beneficial ownership" for purposes of this Agreement having the
meaning assigned thereto in Section 13(d) of the 1934 Act, and the rules and
regulations thereunder);
(iv) Any person other than Grantee or any Grantee Subsidiary shall
have made a bona fide proposal to Issuer or its stockholders by public
announcement or written communication that is or becomes the subject of public
disclosure to engage in an Acquisition Transaction;
(v) After an overture is made by a third party to Issuer or its
stockholders to engage in an Acquisition Transaction, Issuer shall have breached
any covenant or obligation contained in the Merger Agreement and such breach (x)
would entitle Grantee to terminate the Merger Agreement and (y) shall not have
been cured prior to the Notice Date (as defined below); or
(vi) Any person other than Grantee or any Grantee Subsidiary,
other than in connection with a transaction to which Grantee has given its prior
written consent, shall have filed an application or notice with the Federal
Reserve Board, or other federal or state bank regulatory authority, which
application or notice has been accepted for processing, for approval to engage
in an Acquisition Transaction.
(c) The term "Subsequent Triggering Event" shall mean either of the
following events or transactions occurring after the date hereof:
(i) The acquisition by any person of beneficial ownership of 20%
or more of the then outstanding Common Stock; or
(ii) The occurrence of the Initial Triggering Event described in
paragraph (i) of subsection (b) of this Section 2, except that the percentage
referred to in clause (y) shall be 20%.
(d) Issuer shall notify Grantee promptly in writing of the occurrence
of any Initial Triggering Event or Subsequent Triggering Event of which it has
notice (together, a "Triggering Event"), it being understood that the giving of
such notice by Issuer shall not be a condition to the right of the Holder to
exercise the Option.
-4-
<PAGE>
(e) In the event the Holder is entitled to and wishes to exercise the
Option, it shall send to Issuer a written notice (the date of which being herein
referred to as the "Notice Date") specifying (i) the total number of shares it
will purchase pursuant to such exercise and (ii) a place and date not earlier
than three business days nor later than 60 business days from the Notice Date
for the closing of such purchase (the "Closing Date"); provided that if prior
--------
notification to or approval of the Federal Reserve Board or any other regulatory
agency is required in connection with such purchase, the Holder shall promptly
file the required notice or application for approval and shall expeditiously
process the same and the period of time that otherwise would run pursuant to
this sentence shall run instead from the date on which any required notification
periods have expired or been terminated or such approvals have been obtained and
any requisite waiting period or periods shall have passed. Any exercise of the
Option shall be deemed to occur on the Notice Date relating thereto.
(f) At the closing referred to in subsection (e) of this Section 2,
the Holder shall pay to Issuer the aggregate purchase price for the shares of
Common Stock purchased pursuant to the exercise of the Option in immediately
available funds by wire transfer to a bank account designated by Issuer,
provided that failure or refusal of Issuer to designate such a bank account
- --------
shall not preclude the Holder from exercising the Option.
(g) At such closing, simultaneously with the delivery of immediately
available funds as provided in subsection (f) of this Section 2, Issuer shall
deliver to the Holder a certificate or certificates representing the number of
shares of Common Stock purchased by the Holder and, if the Option should be
exercised in part only, a new Option evidencing the rights of the Holder thereof
to purchase the balance of the shares purchasable hereunder, and the Holder
shall deliver to Issuer a copy of this Agreement and a letter agreeing that the
Holder will not offer to sell or otherwise dispose of such shares in violation
of applicable law or the provisions of this Agreement.
(h) Certificates for Common Stock delivered at a closing hereunder
may be endorsed with a restrictive legend that shall read substantially as
follows:
"The transfer of the shares represented by this certificate is subject
to certain provisions of an agreement between the registered holder
hereof and
-5-
<PAGE>
Issuer and to resale restrictions arising under the Securities Act of
1933, as amended. A copy of such agreement is on file at the principal
office of Issuer and will be provided to the holder hereof without
charge upon receipt by Issuer of a written request therefor."
It is understood and agreed that: (i) the reference to the resale restrictions
of the Securities Act of 1933, as amended (the "1933 Act"), in the above legend
shall be removed by delivery of substitute certificate(s) without such reference
if the Holder shall have delivered to Issuer a copy of a letter from the staff
of the SEC, or an opinion of counsel, in form and substance reasonably
satisfactory to Issuer, to the effect that such legend is not required for
purposes of the 1933 Act; (ii) the reference to the provisions to this Agreement
in the above legend shall be removed by delivery of substitute certificate(s)
without such reference if the shares have been sold or transferred in compliance
with the provisions of this Agreement and under circumstances that do not
require the retention of such reference; and (iii) the legend shall be removed
in its entirety if the conditions in the preceding clauses (i) and (ii) are both
satisfied. In addition, such certificates shall bear any other legend as may be
required by law.
(i) Upon the giving by the Holder to Issuer of the written notice of
exercise of the Option provided for under subsection (e) of this Section 2 and
the tender of the applicable purchase price in immediately available funds, the
Holder shall be deemed to be the holder of record of the shares of Common Stock
issuable upon such exercise, notwithstanding that the stock transfer books of
Issuer shall then be closed or that certificates representing such shares of
Common Stock shall not then be actually delivered to the Holder. Issuer shall
pay all expenses, and any and all United States federal, state and local taxes
and other charges that may be payable in connection with the preparation, issue
and delivery of stock certificates under this Section 2 in the name of the
Holder or its assignee, transferee or designee.
3. Issuer agrees: (i) that it shall at all times maintain, free from
preemptive rights, sufficient authorized but unissued or treasury shares of
Common Stock so that the Option may be exercised without additional
authorization of Common Stock after giving effect to all other options,
warrants, convertible securities and other rights to purchase Common Stock; (ii)
that it will not, by charter amendment or through reorganization, consolidation,
merger, dissolution or sale of assets, or by any other voluntary act, avoid or
seek to avoid the observance or performance of any of the covenants,
stipulations or conditions to be observed or performed
-6-
<PAGE>
hereunder by Issuer; (iii) promptly to take all action as may from time to time
be required (including (x) complying with all premerger notification, reporting
and waiting period requirements specified in 15 U.S.C. (S)18a and regulations
promulgated thereunder and (y) in the event, under the Bank Holding Company Act
of 1956, as amended (the "BHCA"), or the Change in Bank Control Act of 1978, as
amended, or any state banking law, prior approval of or notice to the Federal
Reserve Board or to any state regulatory authority is necessary before the
Option may be exercised, cooperating fully with the Holder in preparing such
applications or notices and providing such information to the Federal Reserve
Board or such state regulatory authority as they may require) in order to permit
the Holder to exercise the Option and Issuer duly and effectively to issue
shares of Common Stock pursuant hereto; and (iv) promptly to take all action
provided herein to protect the rights of the Holder against dilution.
4. This Agreement (and the Option granted hereby) are exchangeable,
without expense, at the option of the Holder, upon presentation and surrender of
this Agreement at the principal office of Issuer, for other Agreements providing
for Options of different denominations entitling the holder thereof to purchase,
on the same terms and subject to the same conditions as are set forth herein, in
the aggregate the same number of shares of Common Stock purchasable hereunder.
The terms "Agreement" and "Option" as used herein include any Stock Option
Agreements and related Options for which this Agreement (and the Option granted
hereby) may be exchanged. Upon receipt by Issuer of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this
Agreement, and (in the case of loss, theft or destruction) of reasonably
satisfactory indemnification, and upon surrender and cancellation of this
Agreement, if mutilated, Issuer will execute and deliver a new Agreement of like
tenor and date. Any such new Agreement executed and delivered shall constitute
an additional contractual obligation on the part of Issuer, whether or not the
Agreement so lost, stolen, destroyed or mutilated shall at any time be
enforceable by anyone.
5. In addition to the adjustment in the number of shares of Common
Stock that are purchasable upon exercise of the Option pursuant to Section 1 of
this Agreement, the number of shares of Common Stock purchasable upon the
exercise of the Option and the Option Price shall be subject to adjustment from
time to time as provided in this Section 5. In the event of any change in, or
distributions in respect of, the Common Stock by reason of stock dividends,
split-ups, mergers, recapitalizations, combinations, subdivisions, conversions,
-7-
<PAGE>
exchanges of shares, distributions on or in respect of the Common Stock that
would be prohibited under the terms of the Merger Agreement, or the like, the
type and number of shares of Common Stock purchasable upon exercise hereof and
the Option Price shall be appropriately adjusted in such manner as shall fully
preserve the economic benefits provided hereunder and proper provision shall be
made in any agreement governing any such transaction to provide for such proper
adjustment and the full satisfaction of the Issuer's obligations hereunder.
6. Upon the occurrence of a Subsequent Triggering Event that occurs
prior to an Exercise Termination Event, Issuer shall, at the request of Grantee
delivered within 90 days of such Subsequent Triggering Event (whether on its own
behalf or on behalf of any subsequent holder of this Option (or part thereof) or
any of the shares of Common Stock issued pursuant hereto), promptly prepare,
file and keep current a shelf registration statement under the 1933 Act covering
this Option and any shares issued and issuable pursuant to this Option and shall
use its reasonable best efforts to cause such registration statement to become
effective and remain current in order to permit the sale or other disposition of
this Option and any shares of Common Stock issued upon total or partial exercise
of this Option ("Option Shares") in accordance with any plan of disposition
requested by Grantee. Issuer will use its reasonable best efforts to cause such
registration statement first to become effective and then to remain effective
for such period not in excess of 180 days from the day such registration
statement first becomes effective or such shorter time as may be reasonably
necessary to effect such sales or other dispositions. Grantee shall have the
right to demand two such registrations. The foregoing notwithstanding, if, at
the time of any request by Grantee for registration of the Option or Option
Shares as provided above, Issuer is in registration with respect to an
underwritten public offering of shares of Common Stock, and if in the good faith
judgment of the managing underwriter or managing underwriters, or, if none, the
sole underwriter or underwriters, of such offering the inclusion of the Holder's
Option or Option Shares would interfere with the successful marketing of the
shares of Common Stock offered by Issuer, the number of Option Shares
otherwise to be covered in the registration statement contemplated hereby may
be reduced; and provided, however, that after any such required reduction
-------- -------
the number of Option Shares to be included in such offering for the account of
the Holder shall constitute at least 25% of the total number of shares to be
sold by the Holder and Issuer in the aggregate; and provided further, however,
-------- -------
that if such reduction occurs, then the Issuer shall file a registration
statement for the balance as promptly as practical and no reduction shall
thereafter occur. Each such Holder shall provide all information reasonably
requested by Issuer for inclusion in
-8-
<PAGE>
any registration statement to be filed hereunder. If requested by any such
Holder in connection with such registration, Issuer shall become a party to any
underwriting agreement relating to the sale of such shares, but only to the
extent of obligating itself in respect of representations, warranties,
indemnities and other agreements customarily included in secondary offering
underwriting agreements for the Issuer. Upon receiving any request under this
Section 6 from any Holder, Issuer agrees to send a copy thereof to any other
person known to Issuer to be entitled to registration rights under this Section
6, in each case by promptly mailing the same, postage prepaid, to the address of
record of the persons entitled to receive such copies. Notwithstanding anything
to the contrary contained herein, in no event shall Issuer be obligated to
effect more than two registrations pursuant to this Section 6 by reason of the
fact that there shall be more than one Grantee as a result of any assignment or
division of this Agreement.
7. (a) Immediately prior to the occurrence of a Repurchase Event (as
defined below), (i) following a request of the Holder, delivered prior to an
Exercise Termination Event, Issuer (or any successor thereto) shall repurchase
the Option from the Holder at a price (the "Option Repurchase Price") equal to
the amount by which (A) the Market/Offer Price (as defined below) exceeds (B)
the Option Price, multiplied by the number of shares for which this Option may
then be exercised and (ii) at the request of the owner of Option Shares from
time to time (the "Owner"), delivered within 90 days of such occurrence (or such
later period as provided in Section 10), Issuer shall repurchase such number of
the Option Shares from the Owner as the Owner shall designate at a price (the
"Option Share Repurchase Price") equal to the Market/Offer Price multiplied by
the number of Option Shares so designated. The term "Market/Offer Price" shall
mean the highest of (i) the price per share of Common Stock at which a tender
offer or exchange offer therefor has been made, (ii) the price per share of
Common Stock to be paid by any third party pursuant to an agreement with Issuer,
(iii) the highest closing price for shares of Common Stock within the six-month
period immediately preceding the date the Holder gives notice of the required
repurchase of this Option or the Owner gives notice of the required repurchase
of Option Shares, as the case may be, or (iv) in the event of a sale of all or a
substantial portion of Issuer's assets, the sum of the price paid in such sale
for such assets and the current market value of the remaining assets of Issuer
as determined by a nationally recognized investment banking firm mutually
selected by the Holder or the Owner, as the case may be, on
-9-
<PAGE>
the one hand, and the Issuer, on the other, divided by the number of shares of
Common Stock of Issuer outstanding at the time of such sale. In determining the
Market/Offer Price, the value of consideration other than cash shall be
determined by a nationally recognized investment banking firm mutually selected
by the Holder or Owner, as the case may be, on the one hand, and the Issuer, on
the other.
(b) The Holder and the Owner, as the case may be, may exercise its
right to require Issuer to repurchase the Option and any Option Shares pursuant
to this Section 7 by surrendering for such purpose to Issuer, at its principal
office, a copy of this Agreement or certificates for Option Shares, as
applicable, accompanied by a written notice or notices stating that the Holder
or the Owner, as the case may be, elects to require Issuer to repurchase this
Option and/or the Option Shares in accordance with the provisions of this
Section 7. Within the latter to occur of (x) five business days after the
surrender of the Option and/or certificates representing Option Shares and the
receipt of such notice or notices relating thereto and (y) the time that is
immediately prior to the occurrence of a Repurchase Event, Issuer shall deliver
or cause to be delivered to the Holder the Option Repurchase Price and/or to the
Owner the Option Share Repurchase Price therefor or the portion thereof that
Issuer is not then prohibited under applicable law and regulation from so
delivering.
(c) To the extent that Issuer is prohibited under applicable law or
regulation from repurchasing the Option and/or the Option Shares in full, Issuer
shall immediately so notify the Holder and/or the Owner and thereafter deliver
or cause to be delivered, from time to time, to the Holder and/or the Owner, as
appropriate, the portion of the Option Repurchase Price and the Option Share
Repurchase Price, respectively, that it is no longer prohibited from delivering,
within five business days after the date on which Issuer is no longer so
prohibited; provided, however, that if Issuer at any time after delivery of a
-------- -------
notice of repurchase pursuant to paragraph (b) of this Section 7 is prohibited
under applicable law or regulation from delivering to the Holder and/or the
Owner, as appropriate, the Option Repurchase Price and the Option Share
Repurchase Price, respectively, in full (and Issuer hereby undertakes to use its
best efforts to obtain all required regulatory and legal approvals and to file
any required notices as promptly as practicable in order to accomplish such
repurchase), the Holder or Owner may revoke its notice of repurchase of the
Option or the Option Shares either in whole or to the extent of the prohibition,
whereupon, in the latter case, Issuer shall promptly (i) deliver to the Holder
and/or the Owner, as appropriate, that portion of the Option Repurchase Price
or the Option Share Repurchase Price
-10-
<PAGE>
that Issuer is not prohibited from delivering; and (ii) deliver, as appropriate,
either (A) to the Holder, a new Stock Option Agreement evidencing the right of
the Holder to purchase that number of shares of Common Stock obtained by
multiplying the number of shares of Common Stock for which the surrendered Stock
Option Agreement was exercisable at the time of delivery of the notice of
repurchase by a fraction, the numerator of which is the Option Repurchase Price
less the portion thereof theretofore delivered to the Holder and the denominator
of which is the Option Repurchase Price, or (B) to the Owner, a certificate for
the Option Shares it is then so prohibited from repurchasing.
(d) For purposes of this Section 7, a Repurchase Event shall be
deemed to have occurred (i) upon the consummation of any merger, consolidation
or similar transaction involving Issuer or any purchase, lease or other
acquisition of all or a substantial portion of the assets of Issuer, other than
any such transaction which would not constitute an Acquisition Transaction
pursuant to the provisos to Section 2(b)(i) hereof or (ii) upon the acquisition
by any person of beneficial ownership of 50% or more of the then outstanding
shares of Common Stock, provided that no such event shall constitute a
Repurchase Event unless a Subsequent Triggering Event shall have occurred prior
to an Exercise Termination Event. The parties hereto agree that Issuer's
obligations to repurchase the Option or Option Shares under this Section 7 shall
not terminate upon the occurrence of an Exercise Termination Event unless no
Subsequent Triggering Event shall have occurred prior to the occurrence of an
Exercise Termination Event.
8. (a) In the event that prior to an Exercise Termination Event,
Issuer shall enter into an agreement (i) to consolidate with or merge into any
person, other than Grantee or one of its Subsidiaries, and shall not be the
continuing or surviving corporation of such consolidation or merger, (ii) to
permit any person, other than Grantee or one of its Subsidiaries, to merge into
Issuer and Issuer shall be the continuing or surviving corporation, but, in
connection with such merger, the then outstanding shares of Common Stock shall
be changed into or exchanged for stock or other securities of any other person
or cash or any other property or the then outstanding shares of Common Stock
shall after such merger represent less than 50% of the outstanding voting shares
and voting share equivalents of the merged company, or (iii) to sell or
otherwise transfer all or substantially all of its assets to any person, other
than Grantee or one of its Subsidiaries, then, and in each such case, the
agreement governing
-11-
<PAGE>
such transaction shall make proper provision so that the Option shall, upon the
consummation of any such transaction and upon the terms and conditions set forth
herein, be converted into, or exchanged for, an option (the "Substitute
Option"), at the election of the Holder, of either (x) the Acquiring Corporation
(as hereinafter defined) or (y) any person that controls the Acquiring
Corporation.
(b) The following terms have the meanings indicated:
(1) "Acquiring Corporation" shall mean (i) the continuing or
surviving corporation of a consolidation or merger with Issuer (if other
than Issuer), (ii) Issuer in a merger in which Issuer is the continuing or
surviving person, and (iii) the transferee of all or substantially all of
Issuer's assets.
(2) "Substitute Common Stock" shall mean the common stock issued
by the issuer of the Substitute Option upon exercise of the Substitute
Option.
(3) "Assigned Value" shall mean the Market/Offer Price, as
defined in Section 7.
(4) "Average Price" shall mean the average closing price of a
share of the Substitute Common Stock for the one year immediately preceding
the consolidation, merger or sale in question, but in no event higher than
the closing price of the shares of Substitute Common Stock on the day
preceding such consolidation, merger or sale; provided that if Issuer is
--------
the issuer of the Substitute Option, the Average Price shall be computed
with respect to a share of common stock issued by the person merging into
Issuer or by any company which controls or is controlled by such person, as
the Holder may elect.
(c) The Substitute Option shall have the same terms as the Option,
provided, that if the terms of the Substitute Option cannot, for legal reasons,
- --------
be the same as the Option, such terms shall be as similar as possible and in no
event less advantageous to the Holder. The issuer of the Substitute Option
shall also enter into an agreement with the then Holder or Holders of the
Substitute Option in substantially the same form as this Agreement, which shall
be applicable to the Substitute Option.
(d) The Substitute Option shall be exercisable for such number of
shares of Substitute Common Stock as is equal to the Assigned Value multiplied
by the number of shares of Common Stock for which the Option is then
exercisable, divided
-12-
<PAGE>
by the Average Price. The exercise price of the Substitute Option per share of
Substitute Common Stock shall then be equal to the Option Price multiplied by a
fraction, the numerator of which shall be the number of shares of Common Stock
for which the Option is then exercisable and the denominator of which shall be
the number of shares of Substitute Common Stock for which the Substitute Option
is exercisable.
(e) In no event, pursuant to any of the foregoing paragraphs, shall
the Substitute Option be exercisable for more than 19.9% of the shares of
Substitute Common Stock outstanding prior to exercise of the Substitute Option.
In the event that the Substitute Option would be exercisable for more than 19.9%
of the shares of Substitute Common Stock outstanding prior to exercise but for
this clause (e), the issuer of the Substitute Option (the "Substitute Option
Issuer") shall make a cash payment to Holder equal to the excess of (i) the
value of the Substitute Option without giving effect to the limitation in this
clause (e) over (ii) the value of the Substitute Option after giving effect to
the limitation in this clause (e). This difference in value shall be determined
by a nationally recognized investment banking firm selected by the Holder or the
Owner, as the case may be, and reasonably acceptable to the Acquiring
Corporation.
(f) Issuer shall not enter into any transaction described in
subsection (a) of this Section 8 unless the Acquiring Corporation and any person
that controls the Acquiring Corporation assume in writing all the obligations of
Issuer hereunder.
9. (a) At the request of the holder of the Substitute Option (the
"Substitute Option Holder"), the Substitute Option Issuer shall repurchase the
Substitute Option from the Substitute Option Holder at a price (the "Substitute
Option Repurchase Price") equal to (x) the amount by which (i) the Highest
Closing Price (as hereinafter defined) exceeds (ii) the exercise price of the
Substitute Option, multiplied by the number of shares of Substitute Common Stock
for which the Substitute Option may then be exercised plus (y) Grantee's
reasonable out-of-pocket expenses (to the extent not previously reimbursed), and
at the request of the owner (the "Substitute Share Owner") of shares of
Substitute Common Stock (the "Substitute Shares"), the Substitute Option Issuer
shall repurchase the Substitute Shares at a price (the "Substitute Share
Repurchase Price") equal to (x) the Highest Closing Price multiplied by the
number of Substitute Shares so designated plus (y) Grantee's reasonable Out-of-
Pocket Expenses (to the extent not previously reimbursed). The term "Highest
-13-
<PAGE>
Closing Price" shall mean the highest closing price for shares of Substitute
Common Stock within the six-month period immediately preceding the date the
Substitute Option Holder gives notice of the required repurchase of the
Substitute Option or the Substitute Share Owner gives notice of the required
repurchase of the Substitute Shares, as applicable.
(b) The Substitute Option Holder and the Substitute Share Owner, as
the case may be, may exercise its respective right to require the Substitute
Option Issuer to repurchase the Substitute Option and the Substitute Shares
pursuant to this Section 9 by surrendering for such purpose to the Substitute
Option Issuer, at its principal office, the agreement for such Substitute Option
(or, in the absence of such an agreement, a copy of this Agreement) and
certificates for Substitute Shares accompanied by a written notice or notices
stating that the Substitute Option Holder or the Substitute Share Owner, as the
case may be, elects to require the Substitute Option Issuer to repurchase the
Substitute Option and/or the Substitute Shares in accordance with the provisions
of this Section 9. As promptly as practicable, and in any event within five
business days after the surrender of the Substitute Option and/or certificates
representing Substitute Shares and the receipt of such notice or notices
relating thereto, the Substitute Option Issuer shall deliver or cause to be
delivered to the Substitute Option Holder the Substitute Option Repurchase Price
and/or to the Substitute Share Owner the Substitute Share Repurchase Price
therefor or, in either case, the portion thereof which the Substitute Option
Issuer is not then prohibited under applicable law and regulation from so
delivering.
(c) To the extent that the Substitute Option Issuer is prohibited
under applicable law or regulation from repurchasing the Substitute Option
and/or the Substitute Shares in part or in full, the Substitute Option Issuer
following a request for repurchase pursuant to this Section 9 shall immediately
so notify the Substitute Option Holder and/or the Substitute Share Owner and
thereafter deliver or cause to be delivered, from time to time, to the
Substitute Option Holder and/or the Substitute Share Owner, as appropriate, the
portion of the Substitute Share Repurchase Price, respectively, which it is no
longer prohibited from delivering, within five business days after the date on
which the Substitute Option Issuer is no longer so prohibited; provided,
--------
however, that if the Substitute Option Issuer is at any time after delivery of a
- -------
notice of repurchase pursuant to subsection (b) of this Section 9 prohibited
under applicable law or regulation from delivering to the Substitute Option
Holder and/or the Substitute Share Owner, as appropriate, the Substitute Option
Repurchase Price and the Substitute Share Repurchase Price, respectively, in
full (and the Substitute
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<PAGE>
Option Issuer shall use its best efforts to receive all required regulatory and
legal approvals as promptly as practicable in order to accomplish such
repurchase), the Substitute Option Holder or Substitute Share Owner may revoke
its notice of repurchase of the Substitute Option or the Substitute Shares
either in whole or to the extent of the prohibition, whereupon, in the latter
case, the Substitute Option Issuer shall promptly (i) deliver to the Substitute
Option Holder or Substitute Share Owner, as appropriate, that portion of the
Substitute Option Repurchase Price or the Substitute Share Repurchase Price that
the Substitute Option Issuer is not prohibited from delivering; and (ii)
deliver, as appropriate, either (A) to the Substitute Option Holder, a new
Substitute Option evidencing the right of the Substitute Option Holder to
purchase that number of shares of the Substitute Common Stock obtained by
multiplying the number of shares of the Substitute Common Stock for which the
surrendered Substitute Option was exercisable at the time of delivery of the
notice of repurchase by a fraction, the numerator of which is the Substitute
Option Repurchase Price less the portion thereof theretofore delivered to the
Substitute Option Holder and the denominator of which is the Substitute Option
Repurchase Price, or (B) to the Substitute Share Owner, a certificate for the
Substitute Common Shares it is then so prohibited from repurchasing.
10. The 90-day period for exercise of certain rights under Sections
2, 6, 7 and 13 shall be extended: (i) to the extent necessary to obtain all
regulatory approvals for the exercise of such rights, and for the expiration of
all statutory waiting periods; and (ii) to the extent necessary to avoid
liability under Section 16(b) of the 1934 Act by reason of such exercise.
11. Issuer hereby represents and warrants to Grantee as follows:
(a) Issuer has full corporate power and authority to execute and
deliver this Agreement and to consummate the transactions contemplated hereby.
The execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly and validly authorized by the
Board of Directors of Issuer and no other corporate proceedings on the part of
Issuer are necessary to authorize this Agreement or to consummate the
transactions so contemplated. This Agreement has been duly and validly executed
and delivered by Issuer.
(b) Issuer has taken all necessary corporate action
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<PAGE>
to authorize and reserve and to permit it to issue, and at all times from the
date hereof through the termination of this Agreement in accordance with its
terms will have reserved for issuance upon the exercise of the Option, that
number of shares of Common Stock equal to the maximum number of shares of Common
Stock at any time and from time to time issuable hereunder, and all such shares,
upon issuance pursuant hereto, will be duly authorized, validly issued, fully
paid, nonassessable, and will be delivered free and clear of all claims, liens,
encumbrance and security interests and not subject to any preemptive rights.
(c) Issuer has taken all action (including if required redeeming all
of the Rights or amending or terminating the Rights Agreement) so that the
entering into of this Option Agreement, the acquisition of shares of Common
Stock hereunder and the other transactions contemplated hereby do not and will
not result in the grant of any rights to any person under the Rights Agreement
or enable or require the Rights to be exercised, distributed or triggered.
12. Grantee hereby represents and warrants to Issuer that:
(a) Grantee has all requisite corporate power and authority to enter
into this Agreement and, subject to any approvals or consents referred to
herein, to consummate the transactions contemplated hereby. The execution and
delivery of this Agreement and the consummation of the transactions contemplated
hereby have been duly authorized by all necessary corporate action on the part
of Grantee. This Agreement has been duly executed and delivered by Grantee.
(b) The Option is not being, and any shares of Common Stock or other
securities acquired by Grantee upon exercise of the Option will not be, acquired
with a view to the public distribution thereof and will not be transferred or
otherwise disposed of except in a transaction registered or exempt from
registration under the Securities Act.
13. Neither of the parties hereto may assign any of its rights or
obligations under this Option Agreement or the Option created hereunder to any
other person, without the express written consent of the other party, except
that in the event a Subsequent Triggering Event shall have occurred prior to an
Exercise Termination Event, Grantee, subject to the express provisions hereof,
may assign in whole or in part its rights and obligations hereunder within 90
days following such Subsequent Triggering Event (or such later period as
provided in Section 10); provided, however, that until the date 15 days
-------- -------
following the date on which the Federal Reserve Board approves an application by
Grantee under the BHCA to acquire the shares
-16-
<PAGE>
of Common Stock subject to the Option, Grantee may not assign its rights under
the Option except in (i) a widely dispersed public distribution, (ii) a private
placement in which no one party acquires the right to purchase in excess of 2%
of the voting shares of Issuer, (iii) an assignment to a single party (e.g.,
----
a broker or investment banker) for the purpose of conducting a widely dispersed
public distribution on Grantee's behalf, or (iv) any other manner approved by
the Federal Reserve Board.
14. Each of Grantee and Issuer will use its best efforts to make all
filings with, and to obtain consents of, all third parties and governmental
authorities necessary to the consummation of the transactions contemplated by
this Agreement, including without limitation making application to list the
shares of Common Stock issuable hereunder on the New York Stock Exchange upon
official notice of issuance and applying to the Federal Reserve Board under the
BHCA for approval to acquire the shares issuable hereunder, but Grantee shall
not be obligated to apply to state banking authorities for approval to acquire
the shares of Common Stock issuable hereunder until such time, if ever, as it
deems appropriate to do so.
15. The parties hereto acknowledge that damages would be an
inadequate remedy for a breach of this Agreement by either party hereto and that
the obligations of the parties hereto shall be enforceable by either party
hereto through injunctive or other equitable relief.
16. If any term, provision, covenant or restriction contained in this
Agreement is held by a court or a federal or state regulatory agency of
competent jurisdiction to be invalid, void or unenforceable, the remainder of
the terms, provisions and covenants and restrictions contained in this Agreement
shall remain in full force and effect, and shall in no way be affected, impaired
or invalidated. If for any reason such court or regulatory agency determines
that the Holder is not permitted to acquire, or Issuer is not permitted to
repurchase pursuant to Section 7, the full number of shares of Common Stock
provided in Section 1(a) hereof (as adjusted pursuant to Section 1(b) or 5
hereof), it is the express intention of Issuer to allow the Holder to acquire or
to require Issuer to repurchase such lesser number of shares as may be
permissible, without any amendment or modification hereof.
17. All notices, requests, claims, demands and other communications
hereunder shall be deemed to have been
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<PAGE>
duly given when delivered in person, by cable, telegram, telecopy or telex, or
by registered or certified mail (postage prepaid, return receipt requested) at
the respective addresses of the parties set forth in the Merger Agreement.
18. This Agreement shall be governed by and construed in accordance
with the laws of the State of Delaware, regardless of the laws that might
otherwise govern under applicable principles of conflicts of laws thereof.
19. This Agreement may be executed in two or more counterparts, each
of which shall be deemed to be an original, but all of which shall constitute
one and the same agreement.
20. Except as otherwise expressly provided herein, each of the
parties hereto shall bear and pay all costs and expenses incurred by it or on
its behalf in connection with the transactions contemplated hereunder, including
fees and expenses of its own financial consultants, investment bankers,
accountants and counsel.
21. Except as otherwise expressly provided herein or in the Merger
Agreement, this Agreement contains the entire agreement between the parties with
respect to the transactions contemplated hereunder and supersedes all prior
arrangements or understandings with respect thereof, written or oral. The terms
and conditions of this Agreement shall inure to the benefit of and be binding
upon the parties hereto and their respective successors and permitted assigns.
Nothing in this Agreement, expressed or implied, is intended to confer upon any
party, other than the parties hereto, and their respective successors except as
assigns, any rights, remedies, obligations or liabilities under or by reason of
this Agreement, except as expressly provided herein.
22. Capitalized terms used in this Agreement and not defined herein
shall have the meanings assigned thereto in the Merger Agreement.
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<PAGE>
IN WITNESS WHEREOF, each of the parties has caused this Agreement to
be executed on its behalf by its officers thereunto duly authorized, all as of
the date first above written.
NBD BANCORP, INC.
By: /s/ Verne G. Istock
----------------------------
Verne G. Istock
Chairman and
Chief Executive Officer
FIRST CHICAGO CORPORATION
By: /s/ Richard L. Thomas
----------------------------
Richard L. Thomas
Chairman and
Chief Executive Officer
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<PAGE>
EXHIBIT 99.3
STOCK OPTION AGREEMENT
THE TRANSFER OF THIS AGREEMENT IS SUBJECT TO
CERTAIN PROVISIONS CONTAINED HEREIN AND TO
RESALE RESTRICTIONS UNDER THE
SECURITIES ACT OF 1933, AS AMENDED
STOCK OPTION AGREEMENT, dated July 11, 1995, between NBD BANCORP,
INC., a Delaware corporation ("Issuer"), and FIRST CHICAGO CORPORATION, a
Delaware corporation ("Grantee").
W I T N E S S E T H:
-------------------
WHEREAS, Grantee and Issuer have entered into an Agreement and Plan of
Merger of even date herewith (the "Merger Agreement"), which agreement has been
executed by the parties hereto immediately prior to this Stock Option Agreement
(the "Agreement"); and
WHEREAS, as a condition to Grantee's entering into the Merger
Agreement and in consideration therefor, Issuer has agreed to grant Grantee the
Option (as hereinafter defined):
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements set forth herein and in the Merger Agreement, the
parties hereto agree as follows:
1. (a) Issuer hereby grants to Grantee an unconditional, irrevocable
option (the "Option") to purchase, subject to the terms hereof, up to 31,270,000
fully paid and nonassessable shares of Issuer's Common Stock, par value $1.00
per share ("Common Stock"), at a price of $32-1/2 per share (the "Option
Price"); provided, however, that in no event shall the number of shares of
-------- --------
Common Stock for which this Option is exercisable exceed 19.9% of the Issuer's
issued and outstanding shares of Common Stock without giving effect to any
shares subject to or issued pursuant to the Option. The number of shares of
Common Stock that may be received upon the exercise of the Option and the Option
Price are subject to adjustment as herein set forth.
(b) In the event that any additional shares of Common Stock are
either (i) issued or otherwise become outstanding after the date of this
Agreement (other than pursuant to this Agreement) or (ii) redeemed, repurchased,
retired or otherwise cease to be outstanding after the date of the Agreement,
the number of shares of Common Stock subject
<PAGE>
to the Option shall be increased or decreased, as appropriate, so that, after
such issuance, such number equals 19.9% of the number of shares of Common Stock
then issued and outstanding without giving effect to any shares subject or
issued pursuant to the Option. Nothing contained in this Section 1(b) or
elsewhere in this Agreement shall be deemed to authorize Issuer or Grantee to
breach any provision of the Merger Agreement.
2. (a) The Holder (as hereinafter defined) may exercise the Option,
in whole or part, and from time to time, if, but only if, both an Initial
Triggering Event (as hereinafter defined) and a Subsequent Triggering Event (as
hereinafter defined) shall have occurred prior to the occurrence of an Exercise
Termination Event (as hereinafter defined), provided that the Holder shall have
--------
sent the written notice of such exercise (as provided in subsection (e) of this
Section 2) within 90 days following such Subsequent Triggering Event. Each of
the following shall be an Exercise Termination Event: (i) the Effective Time
(as defined in the Merger Agreement) of the Merger; (ii) termination of the
Merger Agreement in accordance with the provisions thereof if such termination
occurs prior to the occurrence of an Initial Triggering Event except a
termination by Grantee pursuant to Section 8.1(d) of the Merger Agreement
(unless the breach by Issuer giving rise to such right of termination is non-
volitional); or (iii) the passage of 12 months after termination of the Merger
Agreement if such termination follows the occurrence of an Initial Triggering
Event or is a termination by Grantee pursuant to Section 8.1(d) of the Merger
Agreement (unless the breach by Issuer giving rise to such right of termination
is non-volitional) (provided that if an Initial Triggering Event continues or
--------
occurs beyond such termination and prior to the passage of such 12-month period,
the Exercise Termination Event shall be 12 months from the expiration of the
Last Triggering Event but in no event more than 18 months after such
termination). The "Last Triggering Event" shall mean the last Initial
Triggering Event to expire. The term "Holder" shall mean the holder or holders
of the Option.
(b) The term "Initial Triggering Event" shall mean any of the
following events or transactions occurring after the date hereof:
(i) Issuer or any of its Subsidiaries (each an "Issuer
Subsidiary"), without having received Grantee's prior written consent, shall
have entered into an agreement to engage in an Acquisition Transaction (as
hereinafter defined) with any person (the term "person" for purposes of this
Agreement having the meaning assigned thereto in Sections 3(a)(9) and 13(d)(3)
of the Securities Exchange Act of 1934, as amended (the "1934
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<PAGE>
Act"), and the rules and regulations thereunder) other than Grantee or any of
its Subsidiaries (each a "Grantee Subsidiary") or the Board of Directors of
Issuer shall have recommended that the stockholders of Issuer approve or accept
any Acquisition Transaction. For purposes of this Agreement, "Acquisition
Transaction" shall mean (w) a merger or consolidation, or any similar
transaction, involving Issuer or any Significant Subsidiary (as defined in Rule
1-02 of Regulation S-X promulgated by the Securities and Exchange Commission
(the "SEC")) of Issuer, (x) a purchase, lease or other acquisition or assumption
of all or a substantial portion of the assets or deposits of Issuer or any
Significant Subsidiary of Issuer, (y) a purchase or other acquisition (including
by way of merger, consolidation, share exchange or otherwise) of securities
representing 10% or more of the voting power of Issuer, or (z) any substantially
similar transaction; provided, however, that in no event shall any merger,
-------- -------
consolidation, purchase or similar transaction involving only the Issuer and one
or more of its Subsidiaries or involving only any two or more of such
Subsidiaries, be deemed to be an Acquisition Transaction, provided that any such
transaction is not entered into in violation of the terms of the Merger
Agreement; and provided, further, that any transaction described in this
-------- -------
sentence that is expressly permitted by the Merger Agreement shall not be deemed
to be an Acquisition Transaction;
(ii) Issuer or any Issuer Subsidiary, without having received
Grantee's prior written consent, shall have authorized, recommended, proposed or
publicly announced its intention to authorize, recommend or propose, to engage
in an Acquisition Transaction with any person other than Grantee or a Grantee
Subsidiary, or the Board of Directors of Issuer shall have publicly withdrawn or
modified, or publicly announced its interest to withdraw or modify, in any
manner adverse to Grantee, its recommendation that the stockholders of Issuer
approve the transactions contemplated by the Merger Agreement;
(iii) Any person other than Grantee, any Grantee Subsidiary or any
Issuer Subsidiary acting in a fiduciary capacity in the ordinary course of its
business (and other than any person who (a) as of the date hereof beneficially
owns 10% or more of the outstanding shares of Common Stock and (b) would be
eligible to use Schedule 13G but for the fact that such person owns 10% or more
of the outstanding shares of Common Stock) shall have acquired beneficial
ownership or the right to acquire beneficial ownership of 10% or more of
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<PAGE>
the outstanding shares of Common Stock (the term "beneficial ownership" for
purposes of this Agreement having the meaning assigned thereto in Section 13(d)
of the 1934 Act, and the rules and regulations thereunder);
(iv) Any person other than Grantee or any Grantee Subsidiary shall
have made a bona fide proposal to Issuer or its stockholders by public
announcement or written communication that is or becomes the subject of public
disclosure to engage in an Acquisition Transaction;
(v) After an overture is made by a third party to Issuer or its
stockholders to engage in an Acquisition Transaction, Issuer shall have breached
any covenant or obligation contained in the Merger Agreement and such breach (x)
would entitle Grantee to terminate the Merger Agreement and (y) shall not have
been cured prior to the Notice Date (as defined below); or
(vi) Any person other than Grantee or any Grantee Subsidiary, other
than in connection with a transaction to which Grantee has given its prior
written consent, shall have filed an application or notice with the Federal
Reserve Board, or other federal or state bank regulatory authority, which
application or notice has been accepted for processing, for approval to engage
in an Acquisition Transaction.
(c) The term "Subsequent Triggering Event" shall mean either of the
following events or transactions occurring after the date hereof:
(i) The acquisition by any person of beneficial ownership of 20%
or more of the then outstanding Common Stock; or
(ii) The occurrence of the Initial Triggering Event described in
paragraph (i) of subsection (b) of this Section 2, except that the
percentage referred to in clause (y) shall be 20%.
(d) Issuer shall notify Grantee promptly in writing of the occurrence
of any Initial Triggering Event or Subsequent Triggering Event of which it has
notice (together, a "Triggering Event"), it being understood that the giving of
such notice by Issuer shall not be a condition to the right of the Holder to
exercise the Option.
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<PAGE>
(e) In the event the Holder is entitled to and wishes to exercise the
Option, it shall send to Issuer a written notice (the date of which being herein
referred to as the "Notice Date") specifying (i) the total number of shares it
will purchase pursuant to such exercise and (ii) a place and date not earlier
than three business days nor later than 60 business days from the Notice Date
for the closing of such purchase (the "Closing Date"); provided that if prior
--------
notification to or approval of the Federal Reserve Board or any other regulatory
agency is required in connection with such purchase, the Holder shall promptly
file the required notice or application for approval and shall expeditiously
process the same and the period of time that otherwise would run pursuant to
this sentence shall run instead from the date on which any required notification
periods have expired or been terminated or such approvals have been obtained and
any requisite waiting period or periods shall have passed. Any exercise of the
Option shall be deemed to occur on the Notice Date relating thereto.
(f) At the closing referred to in subsection (e) of this Section 2,
the Holder shall pay to Issuer the aggregate purchase price for the shares of
Common Stock purchased pursuant to the exercise of the Option in immediately
available funds by wire transfer to a bank account designated by Issuer,
provided that failure or refusal of Issuer to designate such a bank account
- --------
shall not preclude the Holder from exercising the Option.
(g) At such closing, simultaneously with the delivery of immediately
available funds as provided in subsection (f) of this Section 2, Issuer shall
deliver to the Holder a certificate or certificates representing the number of
shares of Common Stock purchased by the Holder and, if the Option should be
exercised in part only, a new Option evidencing the rights of the Holder thereof
to purchase the balance of the shares purchasable hereunder, and the Holder
shall deliver to Issuer a copy of this Agreement and a letter agreeing that the
Holder will not offer to sell or otherwise dispose of such shares in violation
of applicable law or the provisions of this Agreement.
(h) Certificates for Common Stock delivered at a closing hereunder
may be endorsed with a restrictive legend that shall read substantially as
follows:
"The transfer of the shares represented by this certificate is subject to
certain provisions of an agreement between the registered holder hereof and
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<PAGE>
Issuer and to resale restrictions arising under the Securities Act of 1933,
as amended. A copy of such agreement is on file at the principal office of
Issuer and will be provided to the holder hereof without charge upon
receipt by Issuer of a written request therefor."
It is understood and agreed that: (i) the reference to the resale restrictions
of the Securities Act of 1933, as amended (the "1933 Act"), in the above legend
shall be removed by delivery of substitute certificate(s) without such reference
if the Holder shall have delivered to Issuer a copy of a letter from the staff
of the SEC, or an opinion of counsel, in form and substance reasonably
satisfactory to Issuer, to the effect that such legend is not required for
purposes of the 1933 Act; (ii) the reference to the provisions to this Agreement
in the above legend shall be removed by delivery of substitute certificate(s)
without such reference if the shares have been sold or transferred in compliance
with the provisions of this Agreement and under circumstances that do not
require the retention of such reference; and (iii) the legend shall be removed
in its entirety if the conditions in the preceding clauses (i) and (ii) are both
satisfied. In addition, such certificates shall bear any other legend as may be
required by law.
(i) Upon the giving by the Holder to Issuer of the written notice of
exercise of the Option provided for under subsection (e) of this Section 2 and
the tender of the applicable purchase price in immediately available funds, the
Holder shall be deemed to be the holder of record of the shares of Common Stock
issuable upon such exercise, notwithstanding that the stock transfer books of
Issuer shall then be closed or that certificates representing such shares of
Common Stock shall not then be actually delivered to the Holder. Issuer shall
pay all expenses, and any and all United States federal, state and local taxes
and other charges that may be payable in connection with the preparation, issue
and delivery of stock certificates under this Section 2 in the name of the
Holder or its assignee, transferee or designee.
3. Issuer agrees: (i) that it shall at all times maintain, free from
preemptive rights, sufficient authorized but unissued or treasury shares of
Common Stock so that the Option may be exercised without additional
authorization of Common Stock after giving effect to all other options,
warrants, convertible securities and other rights to purchase Common Stock; (ii)
that it will not, by charter amendment or through reorganization, consolidation,
merger, dissolution or sale of assets, or by any other voluntary act, avoid or
seek to avoid the observance or performance of any of the covenants,
stipulations or conditions to be observed or performed
-6-
<PAGE>
hereunder by Issuer; (iii) promptly to take all action as may from time to time
be required (including (x) complying with all premerger notification, reporting
and waiting period requirements specified in 15 U.S.C. (S)18a and regulations
promulgated thereunder and (y) in the event, under the Bank Holding Company Act
of 1956, as amended (the "BHCA"), or the Change in Bank Control Act of 1978, as
amended, or any state banking law, prior approval of or notice to the Federal
Reserve Board or to any state regulatory authority is necessary before the
Option may be exercised, cooperating fully with the Holder in preparing such
applications or notices and providing such information to the Federal Reserve
Board or such state regulatory authority as they may require) in order to permit
the Holder to exercise the Option and Issuer duly and effectively to issue
shares of Common Stock pursuant hereto; and (iv) promptly to take all action
provided herein to protect the rights of the Holder against dilution.
4. This Agreement (and the Option granted hereby) are exchangeable,
without expense, at the option of the Holder, upon presentation and surrender of
this Agreement at the principal office of Issuer, for other Agreements providing
for Options of different denominations entitling the holder thereof to purchase,
on the same terms and subject to the same conditions as are set forth herein, in
the aggregate the same number of shares of Common Stock purchasable hereunder.
The terms "Agreement" and "Option" as used herein include any Stock Option
Agreements and related Options for which this Agreement (and the Option granted
hereby) may be exchanged. Upon receipt by Issuer of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this
Agreement, and (in the case of loss, theft or destruction) of reasonably
satisfactory indemnification, and upon surrender and cancellation of this
Agreement, if mutilated, Issuer will execute and deliver a new Agreement of like
tenor and date. Any such new Agreement executed and delivered shall constitute
an additional contractual obligation on the part of Issuer, whether or not the
Agreement so lost, stolen, destroyed or mutilated shall at any time be
enforceable by anyone.
5. In addition to the adjustment in the number of shares of Common
Stock that are purchasable upon exercise of the Option pursuant to Section 1 of
this Agreement, the number of shares of Common Stock purchasable upon the
exercise of the Option and the Option Price shall be subject to adjustment from
time to time as provided in this Section 5. In the event of any change in, or
distributions in respect of, the Common Stock by reason of stock dividends,
split-ups, mergers, recapitalizations, combinations, subdivisions, conversions,
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<PAGE>
exchanges of shares, distributions on or in respect of the Common Stock that
would be prohibited under the terms of the Merger Agreement, or the like, the
type and number of shares of Common Stock purchasable upon exercise hereof and
the Option Price shall be appropriately adjusted in such manner as shall fully
preserve the economic benefits provided hereunder and proper provision shall be
made in any agreement governing any such transaction to provide for such proper
adjustment and the full satisfaction of the Issuer's obligations hereunder.
6. Upon the occurrence of a Subsequent Triggering Event that occurs
prior to an Exercise Termination Event, Issuer shall, at the request of Grantee
delivered within 90 days of such Subsequent Triggering Event (whether on its own
behalf or on behalf of any subsequent holder of this Option (or part thereof) or
any of the shares of Common Stock issued pursuant hereto), promptly prepare,
file and keep current a shelf registration statement under the 1933 Act covering
this Option and any shares issued and issuable pursuant to this Option and shall
use its reasonable best efforts to cause such registration statement to become
effective and remain current in order to permit the sale or other disposition of
this Option and any shares of Common Stock issued upon total or partial exercise
of this Option ("Option Shares") in accordance with any plan of disposition
requested by Grantee. Issuer will use its reasonable best efforts to cause such
registration statement first to become effective and then to remain effective
for such period not in excess of 180 days from the day such registration
statement first becomes effective or such shorter time as may be reasonably
necessary to effect such sales or other dispositions. Grantee shall have the
right to demand two such registrations. The foregoing notwithstanding, if, at
the time of any request by Grantee for registration of the Option or Option
Shares as provided above, Issuer is in registration with respect to an
underwritten public offering of shares of Common Stock, and if in the good faith
judgment of the managing underwriter or managing underwriters, or, if none, the
sole underwriter or underwriters, of such offering the inclusion of the Holder's
Option or Option Shares would interfere with the successful marketing of the
shares of Common Stock offered by Issuer, the number of Option Shares otherwise
to be covered in the registration statement contemplated hereby may be reduced;
and provided, however, that after any such required reduction the number of
-------- -------
Option Shares to be included in such offering for the account of the Holder
shall constitute at least 25% of the total number of shares to be sold by the
Holder and Issuer in the aggregate; and provided further, however, that if such
-------- -------
reduction occurs, then the Issuer shall file a registration statement for the
balance as promptly as practical and no reduction shall thereafter occur. Each
such Holder shall provide all information reasonably requested by Issuer for
inclusion in
-8-
<PAGE>
any registration statement to be filed hereunder. If requested by any such
Holder in connection with such registration, Issuer shall become a party to any
underwriting agreement relating to the sale of such shares, but only to the
extent of obligating itself in respect of representations, warranties,
indemnities and other agreements customarily included in secondary offering
underwriting agreements for the Issuer. Upon receiving any request under this
Section 6 from any Holder, Issuer agrees to send a copy thereof to any other
person known to Issuer to be entitled to registration rights under this Section
6, in each case by promptly mailing the same, postage prepaid, to the address of
record of the persons entitled to receive such copies. Notwithstanding anything
to the contrary contained herein, in no event shall Issuer be obligated to
effect more than two registrations pursuant to this Section 6 by reason of the
fact that there shall be more than one Grantee as a result of any assignment or
division of this Agreement.
7. (a) Immediately prior to the occurrence of a Repurchase Event (as
defined below), (i) following a request of the Holder, delivered prior to an
Exercise Termination Event, Issuer (or any successor thereto) shall repurchase
the Option from the Holder at a price (the "Option Repurchase Price") equal to
the amount by which (A) the Market/Offer Price (as defined below) exceeds (B)
the Option Price, multiplied by the number of shares for which this Option may
then be exercised and (ii) at the request of the owner of Option Shares from
time to time (the "Owner"), delivered within 90 days of such occurrence (or such
later period as provided in Section 10), Issuer shall repurchase such number of
the Option Shares from the Owner as the Owner shall designate at a price (the
"Option Share Repurchase Price") equal to the Market/Offer Price multiplied by
the number of Option Shares so designated. The term "Market/Offer Price" shall
mean the highest of (i) the price per share of Common Stock at which a tender
offer or exchange offer therefor has been made, (ii) the price per share of
Common Stock to be paid by any third party pursuant to an agreement with Issuer,
(iii) the highest closing price for shares of Common Stock within the six-month
period immediately preceding the date the Holder gives notice of the required
repurchase of this Option or the Owner gives notice of the required repurchase
of Option Shares, as the case may be, or (iv) in the event of a sale of all or a
substantial portion of Issuer's assets, the sum of the price paid in such sale
for such assets and the current market value of the remaining assets of Issuer
as determined by a nationally recognized investment banking firm mutually
selected by the Holder or the Owner, as the case may be, on
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<PAGE>
the one hand, and the Issuer, on the other, divided by the number of shares of
Common Stock of Issuer outstanding at the time of such sale. In determining the
Market/Offer Price, the value of consideration other than cash shall be
determined by a nationally recognized investment banking firm mutually selected
by the Holder or Owner, as the case may be, on the one hand, and the Issuer, on
the other.
(b) The Holder and the Owner, as the case may be, may exercise its
right to require Issuer to repurchase the Option and any Option Shares pursuant
to this Section 7 by surrendering for such purpose to Issuer, at its principal
office, a copy of this Agreement or certificates for Option Shares, as
applicable, accompanied by a written notice or notices stating that the Holder
or the Owner, as the case may be, elects to require Issuer to repurchase this
Option and/or the Option Shares in accordance with the provisions of this
Section 7. Within the latter to occur of (x) five business days after the
surrender of the Option and/or certificates representing Option Shares and the
receipt of such notice or notices relating thereto and (y) the time that is
immediately prior to the occurrence of a Repurchase Event, Issuer shall deliver
or cause to be delivered to the Holder the Option Repurchase Price and/or to the
Owner the Option Share Repurchase Price therefor or the portion thereof that
Issuer is not then prohibited under applicable law and regulation from so
delivering.
(c) To the extent that Issuer is prohibited under applicable law or
regulation from repurchasing the Option and/or the Option Shares in full, Issuer
shall immediately so notify the Holder and/or the Owner and thereafter deliver
or cause to be delivered, from time to time, to the Holder and/or the Owner, as
appropriate, the portion of the Option Repurchase Price and the Option Share
Repurchase Price, respectively, that it is no longer prohibited from delivering,
within five business days after the date on which Issuer is no longer so
prohibited; provided, however, that if Issuer at any time after delivery of a
-------- -------
notice of repurchase pursuant to paragraph (b) of this Section 7 is prohibited
under applicable law or regulation from delivering to the Holder and/or the
Owner, as appropriate, the Option Repurchase Price and the Option Share
Repurchase Price, respectively, in full (and Issuer hereby undertakes to use its
best efforts to obtain all required regulatory and legal approvals and to file
any required notices as promptly as practicable in order to accomplish such
repurchase), the Holder or Owner may revoke its notice of repurchase of the
Option or the Option Shares either in whole or to the extent of the prohibition,
whereupon, in the latter case, Issuer shall promptly (i) deliver to the Holder
and/or the Owner, as appropriate, that portion of the Option Repurchase Price or
the Option Share Repurchase Price
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<PAGE>
that Issuer is not prohibited from delivering; and (ii) deliver, as appropriate,
either (A) to the Holder, a new Stock Option Agreement evidencing the right of
the Holder to purchase that number of shares of Common Stock obtained by
multiplying the number of shares of Common Stock for which the surrendered Stock
Option Agreement was exercisable at the time of delivery of the notice of
repurchase by a fraction, the numerator of which is the Option Repurchase Price
less the portion thereof theretofore delivered to the Holder and the denominator
of which is the Option Repurchase Price, or (B) to the Owner, a certificate for
the Option Shares it is then so prohibited from repurchasing.
(d) For purposes of this Section 7, a Repurchase Event shall be
deemed to have occurred (i) upon the consummation of any merger, consolidation
or similar transaction involving Issuer or any purchase, lease or other
acquisition of all or a substantial portion of the assets of Issuer, other than
any such transaction which would not constitute an Acquisition Transaction
pursuant to the provisos to Section 2(b)(i) hereof or (ii) upon the acquisition
by any person of beneficial ownership of 50% or more of the then outstanding
shares of Common Stock, provided that no such event shall constitute a
Repurchase Event unless a Subsequent Triggering Event shall have occurred prior
to an Exercise Termination Event. The parties hereto agree that Issuer's
obligations to repurchase the Option or Option Shares under this Section 7 shall
not terminate upon the occurrence of an Exercise Termination Event unless no
Subsequent Triggering Event shall have occurred prior to the occurrence of an
Exercise Termination Event.
8. (a) In the event that prior to an Exercise Termination Event,
Issuer shall enter into an agreement (i) to consolidate with or merge into any
person, other than Grantee or one of its Subsidiaries, and shall not be the
continuing or surviving corporation of such consolidation or merger, (ii) to
permit any person, other than Grantee or one of its Subsidiaries, to merge into
Issuer and Issuer shall be the continuing or surviving corporation, but, in
connection with such merger, the then outstanding shares of Common Stock shall
be changed into or exchanged for stock or other securities of any other person
or cash or any other property or the then outstanding shares of Common Stock
shall after such merger represent less than 50% of the outstanding voting shares
and voting share equivalents of the merged company, or (iii) to sell or
otherwise transfer all or substantially all of its assets to any person, other
than Grantee or one of its Subsidiaries, then, and in each such case, the
agreement governing
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<PAGE>
such transaction shall make proper provision so that the Option shall, upon the
consummation of any such transaction and upon the terms and conditions set forth
herein, be converted into, or exchanged for, an option (the "Substitute
Option"), at the election of the Holder, of either (x) the Acquiring Corporation
(as hereinafter defined) or (y) any person that controls the Acquiring
Corporation.
(b) The following terms have the meanings indicated:
(1) "Acquiring Corporation" shall mean (i) the continuing or
surviving corporation of a consolidation or merger with Issuer (if other
than Issuer), (ii) Issuer in a merger in which Issuer is the continuing or
surviving person, and (iii) the transferee of all or substantially all of
Issuer's assets.
(2) "Substitute Common Stock" shall mean the common stock issued
by the issuer of the Substitute Option upon exercise of the Substitute
Option.
(3) "Assigned Value" shall mean the Market/Offer Price, as
defined in Section 7.
(4) "Average Price" shall mean the average closing price of a
share of the Substitute Common Stock for the one year immediately preceding
the consolidation, merger or sale in question, but in no event higher than
the closing price of the shares of Substitute Common Stock on the day
preceding such consolidation, merger or sale; provided that if Issuer is
--------
the issuer of the Substitute Option, the Average Price shall be computed
with respect to a share of common stock issued by the person merging into
Issuer or by any company which controls or is controlled by such person, as
the Holder may elect.
(c) The Substitute Option shall have the same terms as the Option,
provided, that if the terms of the Substitute Option cannot, for legal reasons,
- --------
be the same as the Option, such terms shall be as similar as possible and in no
event less advantageous to the Holder. The issuer of the Substitute Option
shall also enter into an agreement with the then Holder or Holders of the
Substitute Option in substantially the same form as this Agreement, which shall
be applicable to the Substitute Option.
(d) The Substitute Option shall be exercisable for such number of
shares of Substitute Common Stock as is equal to the Assigned Value multiplied
by the number of shares of Common Stock for which the Option is then
exercisable, divided
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<PAGE>
by the Average Price. The exercise price of the Substitute Option per share of
Substitute Common Stock shall then be equal to the Option Price multiplied by a
fraction, the numerator of which shall be the number of shares of Common Stock
for which the Option is then exercisable and the denominator of which shall be
the number of shares of Substitute Common Stock for which the Substitute Option
is exercisable.
(e) In no event, pursuant to any of the foregoing paragraphs, shall
the Substitute Option be exercisable for more than 19.9% of the shares of
Substitute Common Stock outstanding prior to exercise of the Substitute Option.
In the event that the Substitute Option would be exercisable for more than 19.9%
of the shares of Substitute Common Stock outstanding prior to exercise but for
this clause (e), the issuer of the Substitute Option (the "Substitute Option
Issuer") shall make a cash payment to Holder equal to the excess of (i) the
value of the Substitute Option without giving effect to the limitation in this
clause (e) over (ii) the value of the Substitute Option after giving effect to
the limitation in this clause (e). This difference in value shall be determined
by a nationally recognized investment banking firm selected by the Holder or the
Owner, as the case may be, and reasonably acceptable to the Acquiring
Corporation.
(f) Issuer shall not enter into any transaction described in
subsection (a) of this Section 8 unless the Acquiring Corporation and any person
that controls the Acquiring Corporation assume in writing all the obligations of
Issuer hereunder.
9. (a) At the request of the holder of the Substitute Option (the
"Substitute Option Holder"), the Substitute Option Issuer shall repurchase the
Substitute Option from the Substitute Option Holder at a price (the "Substitute
Option Repurchase Price") equal to (x) the amount by which (i) the Highest
Closing Price (as hereinafter defined) exceeds (ii) the exercise price of the
Substitute Option, multiplied by the number of shares of Substitute Common Stock
for which the Substitute Option may then be exercised plus (y) Grantee's
reasonable out-of-pocket expenses (to the extent not previously reimbursed), and
at the request of the owner (the "Substitute Share Owner") of shares of
Substitute Common Stock (the "Substitute Shares"), the Substitute Option Issuer
shall repurchase the Substitute Shares at a price (the "Substitute Share
Repurchase Price") equal to (x) the Highest Closing Price multiplied by the
number of Substitute Shares so designated plus (y) Grantee's reasonable Out-of-
Pocket Expenses (to the extent not previously reimbursed). The term "Highest
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<PAGE>
Closing Price" shall mean the highest closing price for shares of Substitute
Common Stock within the six-month period immediately preceding the date the
Substitute Option Holder gives notice of the required repurchase of the
Substitute Option or the Substitute Share Owner gives notice of the required
repurchase of the Substitute Shares, as applicable.
(b) The Substitute Option Holder and the Substitute Share Owner, as
the case may be, may exercise its respective right to require the Substitute
Option Issuer to repurchase the Substitute Option and the Substitute Shares
pursuant to this Section 9 by surrendering for such purpose to the Substitute
Option Issuer, at its principal office, the agreement for such Substitute Option
(or, in the absence of such an agreement, a copy of this Agreement) and
certificates for Substitute Shares accompanied by a written notice or notices
stating that the Substitute Option Holder or the Substitute Share Owner, as the
case may be, elects to require the Substitute Option Issuer to repurchase the
Substitute Option and/or the Substitute Shares in accordance with the provisions
of this Section 9. As promptly as practicable, and in any event within five
business days after the surrender of the Substitute Option and/or certificates
representing Substitute Shares and the receipt of such notice or notices
relating thereto, the Substitute Option Issuer shall deliver or cause to be
delivered to the Substitute Option Holder the Substitute Option Repurchase Price
and/or to the Substitute Share Owner the Substitute Share Repurchase Price
therefor or, in either case, the portion thereof which the Substitute Option
Issuer is not then prohibited under applicable law and regulation from so
delivering.
(c) To the extent that the Substitute Option Issuer is prohibited
under applicable law or regulation from repurchasing the Substitute Option
and/or the Substitute Shares in part or in full, the Substitute Option Issuer
following a request for repurchase punishment to this Section 9 shall
immediately so notify the Substitute Option Holder and/or the Substitute Share
Owner and thereafter deliver or cause to be delivered, from time to time, to the
Substitute Option Holder and/or the Substitute Share Owner, as appropriate, the
portion of the Substitute Share Repurchase Price, respectively, which it is no
longer prohibited from delivering, within five business days after the date on
which the Substitute Option Issuer is no longer so prohibited; provided,
--------
however, that if the Substitute Option Issuer is at any time after delivery of a
- -------
notice of repurchase pursuant to subsection (b) of this Section 9 prohibited
under applicable law or regulation from delivering to the Substitute Option
Holder and/or the Substitute Share Owner, as appropriate, the Substitute Option
Repurchase Price and the Substitute Share Repurchase Price, respectively, in
full (and the Substitute
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<PAGE>
Option Issuer shall use its best efforts to receive all required regulatory and
legal approvals as promptly as practicable in order to accomplish such
repurchase), the Substitute Option Holder or Substitute Share Owner may revoke
its notice of repurchase of the Substitute Option or the Substitute Shares
either in whole or to the extent of the prohibition, whereupon, in the latter
case, the Substitute Option Issuer shall promptly (i) deliver to the Substitute
Option Holder or Substitute Share Owner, as appropriate, that portion of the
Substitute Option Repurchase Price or the Substitute Share Repurchase Price that
the Substitute Option Issuer is not prohibited from delivering; and (ii)
deliver, as appropriate, either (A) to the Substitute Option Holder, a new
Substitute Option evidencing the right of the Substitute Option Holder to
purchase that number of shares of the Substitute Common Stock obtained by
multiplying the number of shares of the Substitute Common Stock for which the
surrendered Substitute Option was exercisable at the time of delivery of the
notice of repurchase by a fraction, the numerator of which is the Substitute
Option Repurchase Price less the portion thereof theretofore delivered to the
Substitute Option Holder and the denominator of which is the Substitute Option
Repurchase Price, or (B) to the Substitute Share Owner, a certificate for the
Substitute Common Shares it is then so prohibited from repurchasing.
10. The 90-day period for exercise of certain rights under Sections
2, 6, 7 and 13 shall be extended: (i) to the extent necessary to obtain all
regulatory approvals for the exercise of such rights, and for the expiration of
all statutory waiting periods; and (ii) to the extent necessary to avoid
liability under Section 16(b) of the 1934 Act by reason of such exercise.
11. Issuer hereby represents and warrants to Grantee as follows:
(a) Issuer has full corporate power and authority to execute and
deliver this Agreement and to consummate the transactions contemplated hereby.
The execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly and validly authorized by the
Board of Directors of Issuer and no other corporate proceedings on the part of
Issuer are necessary to authorize this Agreement or to consummate the
transactions so contemplated. This Agreement has been duly and validly executed
and delivered by Issuer.
(b) Issuer has taken all necessary corporate action
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<PAGE>
to authorize and reserve and to permit it to issue, and at all times from the
date hereof through the termination of this Agreement in accordance with its
terms will have reserved for issuance upon the exercise of the Option, that
number of shares of Common Stock equal to the maximum number of shares of Common
Stock at any time and from time to time issuable hereunder, and all such shares,
upon issuance pursuant hereto, will be duly authorized, validly issued, fully
paid, nonassessable, and will be delivered free and clear of all claims, liens,
encumbrance and security interests and not subject to any preemptive rights.
12. Grantee hereby represents and warrants to Issuer that:
(a) Grantee has all requisite corporate power and authority to enter
into this Agreement and, subject to any approvals or consents referred to
herein, to consummate the transactions contemplated hereby. The execution and
delivery of this Agreement and the consummation of the transactions contemplated
hereby have been duly authorized by all necessary corporate action on the part
of Grantee. This Agreement has been duly executed and delivered by Grantee.
(b) The Option is not being, and any shares of Common Stock or other
securities acquired by Grantee upon exercise of the Option will not be, acquired
with a view to the public distribution thereof and will not be transferred or
otherwise disposed of except in a transaction registered or exempt from
registration under the Securities Act.
13. Neither of the parties hereto may assign any of its rights or
obligations under this Option Agreement or the Option created hereunder to any
other person, without the express written consent of the other party, except
that in the event a Subsequent Triggering Event shall have occurred prior to an
Exercise Termination Event, Grantee, subject to the express provisions hereof,
may assign in whole or in part its rights and obligations hereunder within 90
days following such Subsequent Triggering Event (or such later period as
provided in Section 10); provided, however, that until the date 15 days
-------- -------
following the date on which the Federal Reserve Board approves an application by
Grantee under the BHCA to acquire the shares of Common Stock subject to the
Option, Grantee may not assign its rights under the Option except in (i) a
widely dispersed public distribution, (ii) a private placement in which no one
party acquires the right to purchase in excess of 2% of the voting shares of
Issuer, (iii) an assignment to a single party (e.g., a broker or investment
----
banker) for the purpose of conducting a widely dispersed public distribution on
Grantee's behalf, or (iv) any other manner approved by the Federal Reserve
Board.
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<PAGE>
14. Each of Grantee and Issuer will use its best efforts to make all
filings with, and to obtain consents of, all third parties and governmental
authorities necessary to the consummation of the transactions contemplated by
this Agreement, including without limitation making application to list the
shares of Common Stock issuable hereunder on the New York Stock Exchange upon
official notice of issuance and applying to the Federal Reserve Board under the
BHCA for approval to acquire the shares issuable hereunder, but Grantee shall
not be obligated to apply to state banking authorities for approval to acquire
the shares of Common Stock issuable hereunder until such time, if ever, as it
deems appropriate to do so.
15. The parties hereto acknowledge that damages would be an
inadequate remedy for a breach of this Agreement by either party hereto and that
the obligations of the parties hereto shall be enforceable by either party
hereto through injunctive or other equitable relief.
16. If any term, provision, covenant or restriction contained in this
Agreement is held by a court or a federal or state regulatory agency of
competent jurisdiction to be invalid, void or unenforceable, the remainder of
the terms, provisions and covenants and restrictions contained in this Agreement
shall remain in full force and effect, and shall in no way be affected, impaired
or invalidated. If for any reason such court or regulatory agency determines
that the Holder is not permitted to acquire, or Issuer is not permitted to
repurchase pursuant to Section 7, the full number of shares of Common Stock
provided in Section 1(a) hereof (as adjusted pursuant to Section 1(b) or 5
hereof), it is the express intention of Issuer to allow the Holder to acquire or
to require Issuer to repurchase such lesser number of shares as may be
permissible, without any amendment or modification hereof.
17. All notices, requests, claims, demands and other communications
hereunder shall be deemed to have been duly given when delivered in person, by
cable, telegram, telecopy or telex, or by registered or certified mail (postage
prepaid, return receipt requested) at the respective addresses of the parties
set forth in the Merger Agreement.
18. This Agreement shall be governed by and construed in accordance
with the laws of the State of Delaware, regardless of the laws that might
otherwise govern under applicable principles of conflicts of laws thereof.
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<PAGE>
19. This Agreement may be executed in two or more counterparts, each
of which shall be deemed to be an original, but all of which shall constitute
one and the same agreement.
20. Except as otherwise expressly provided herein, each of the
parties hereto shall bear and pay all costs and expenses incurred by it or on
its behalf in connection with the transactions contemplated hereunder, including
fees and expenses of its own financial consultants, investment bankers,
accountants and counsel.
21. Except as otherwise expressly provided herein or in the Merger
Agreement, this Agreement contains the entire agreement between the parties with
respect to the transactions contemplated hereunder and supersedes all prior
arrangements or understandings with respect thereof, written or oral. The terms
and conditions of this Agreement shall inure to the benefit of and be binding
upon the parties hereto and their respective successors and permitted assigns.
Nothing in this Agreement, expressed or implied, is intended to confer upon any
party, other than the parties hereto, and their respective successors except as
assigns, any rights, remedies, obligations or liabilities under or by reason of
this Agreement, except as expressly provided herein.
22. Capitalized terms used in this Agreement and not defined herein
shall have the meanings assigned thereto in the Merger Agreement.
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<PAGE>
IN WITNESS WHEREOF, each of the parties has caused this Agreement to
be executed on its behalf by its officers thereunto duly authorized, all as of
the date first above written.
NBD BANCORP, INC.
By: /s/ Verne G. Istock
---------------------------
Verne G. Istock
Chairman and
Chief Executive Officer
FIRST CHICAGO CORPORATION
By: /s/ Richard L. Thomas
----------------------------
Richard L. Thomas
Chairman and
Chief Executive Officer
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<PAGE>
EXHIBIT 99.4
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News Release
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FOR IMMEDIATE RELEASE
FIRST CHICAGO CORPORATION AND NBD BANCORP
TO MERGE
CHICAGO, IL and DETROIT, MI, July 12, 1995 -- First Chicago Corporation
(NYSE: FNB) and NBD Bancorp, Inc. (NYSE: NBD) announced today that they have
signed a definitive agreement providing for a merger of equals, which will
result in the combined company becoming the Midwest's leading provider of
banking services to consumers, middle market companies and large corporate
customers.
Highlights of the merger and the new combined company include:
. Immediately accretive to 1996 earnings per share; higher future
earnings growth
. Financial returns among the strongest of the nation's largest banks
. No. 1 market share positions in Illinois, Michigan and Indiana
. Extensive complementary product capabilities and diverse customer base
. The fourth largest issuer of bank credit cards in the U.S.; the
leading banking company in Midwest middle market activities; No. 1 in
large corporate banking relationships in the Midwest as well as a
leader nationally
. Annual cost savings approximating $200 million
. Superior credit quality and capital ratios
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<PAGE>
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. $300 million common stock buyback prior to consummation of merger;
. Approximately $1 billion of capital by 1997 available for reinvestment
or return to stockholders
. Approximately $120 billion in assets at closing; estimated market
capitalization of $11 billion, ranking among the top ten bank holding
companies
Upon completion of the merger, estimated to occur in the first quarter
of 1996, Richard L. Thomas, Chairman of First Chicago will be Chairman of the
new organization until his retirement on May 20, 1996, Verne G. Istock,
currently Chairman and Chief Executive Officer of NBD will become President and
Chief Executive Officer of the new Corporation. Upon Mr. Thomas' retirement,
Mr. Istock will be named Chairman.
Additionally, Thomas H. Jeffs II, President of NBD, will be appointed
Vice Chairman of the new Corporation and will continue as President of NBD Bank
(Michigan). David J. Vitale, Vice Chairman of First Chicago, will be appointed
Vice Chairman of the new Corporation and President of The First National Bank of
Chicago. Scott P. Marks Jr., Executive Vice President of First Chicago, will be
appointed Vice Chairman of the new Corporation and will continue as Chairman of
FCC National Bank. These three individuals, along with Mr. Thomas and Mr.
Istock, will function as the Office of the Chairman and constitute the senior
management team of the new Corporation. Other senior appointments will be
announced in the near future.
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<PAGE>
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The new name of the combined companies will be First Chicago NBD
Corporation, and its headquarters will be in Chicago. The principal subsidiary
banks will be The First National Bank of Chicago, NBD Bank (Michigan),
headquartered in Detroit, NBD Bank (Indiana), headquartered in Indianapolis,
American National Bank and Trust Company of Chicago and FCC National Bank. NBD
Bank (Illinois) will be merged into The First National Bank of Chicago. First
Chicago NBD Corporation's Board of Directors will have equal representation from
the Boards of each of the merging companies.
"We are confident that this combination of two high performing companies
will enable us to serve our stockholders, customers, employees and communities
more effectively," said Thomas. "The addition of NBD's significant customer
base and superb credit skills with First Chicago's wide product range and
attractive market positions will create an exceptional competitor."
Istock said, "The combination of these two fine banking organizations is
part of the continuing consolidation of the financial services industry. Our
new company will have the scale and capabilities to compete head-to-head with
banks and non-banking financial companies across the Midwest, the United States
and around the world."
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<PAGE>
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Thomas and Istock commented that the merger will provide the critical
mass and resources to invest aggressively in the technology required to be a
highly effective and successful competitor. The combination also provides a
platform for future business expansion in the Midwest.
Common stockholders of First Chicago will receive 1.81 shares of common
stock of First Chicago NBD Corporation in exchange for each share of First
Chicago common stock. Each share of common stock of NBD will remain
outstanding and represent one share of the new company. After the exchange, it
is expected that stockholders of First Chicago will own approximately 50.1
percent of the common equity of the combined companies and stockholders of NBD
approximately 49.9 percent.
Each share of First Chicago's outstanding series of preferred stock will
be exchanged for one share of preferred stock on First Chicago NBD Corporation
with terms identical to those of the existing First Chicago preferred.
Both First Chicago and NBD continue to have strong earnings momentum.
Both companies are on track to meet or exceed analysts' earnings expectations
for 1995. Prior to the merger, the Board of Directors of First Chicago
anticipates increasing the annual dividend rate on its common stock by 20 cents
to $2.40 per share.
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<PAGE>
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For 1996 and 1997, the financial outlook for the new company includes
the following plans:
. $200 million in annualized cost savings to be fully realized in 1997.
Reductions resulting from elimination of the overlap in Chicago-area
retail branch expense constitute the largest component. Product
synergies in the large corporate and middle markets, and staff and
functional areas provide expense reduction opportunities as well.
. An estimated restructuring charge of $225 million for merger related
costs.
. Balance sheet reductions over time of approximately $25 billion of
low margin assets.
. The repurchase in the aggregate of approximately $300 million worth of
First Chicago and NBD common stock prior to the merger's close.
The merger will be accounted for as a pooling and is expected to be
consummated by early 1996, pending stockholder approvals, regulatory approvals,
and other customary conditions of closing. The merger is also expected to be a
tax-free reorganization for federal income tax purposes.
In connection with the execution of the merger agreement, First Chicago
granted NBD an option to purchase, under certain circumstances, up to 19.9
percent of First Chicago's outstanding shares of common stock. NBD also granted
First Chicago an option to purchase, under certain circumstances, up to 19.9
percent of NBD's outstanding shares of common stock.
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<PAGE>
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Leo Mullin, President of First Chicago, has elected to resign his
position as a result of this merger. Mullin said, "The merger of First Chicago
and NBD will be highly positive for the shareholders and other constituencies of
both organizations, and I support it fully. Regretfully, my own aspirations
will have to be realized elsewhere, but I am looking forward to this next new
phase in my career."
Thomas said, "Leo has been a superb contributor to First Chicago for 15
years, including his service as President since November, 1993. He has been
completely supportive of this merger knowing that it could end his services with
the bank. He has been extremely professional throughout. We will sincerely
miss Leo and wish him well."
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First Chicago Media Contacts: Lisabeth Weiner (312) 732-4455
Thomas Kelly (312) 732-7007
First Chicago Investor Contacts: Susan Temple (312) 732-8013
Sean O'Neill (312) 732-4812
NBD Bancorp Media Contact: J. Richard Johnson (313) 225-2591
NBD Bancorp Investor Contact: Terence C. Wise (313) 225-3276
