FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
Date of Report (Date of earliest event reported): March 17, 2000
CCB FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)
North Carolina 0-12358 56-1347849
(State or other (Commission File (IRS Employer
jurisdiction of Number) Identification No.)
incorporation)
111 Corcoran Street, Durham, North Carolina 27701
(Address, including zip code, of principal executive office)
(919) 683-7777
(Registrant's telephone number, including zip code)
Item 5. Other Events.
On March 17, 2000, CCB Financial Corporation ("CCB") and
National Commerce Bancorporation ("NCB") entered into an
Agreement and Plan of Merger (the "Agreement") pursuant to which
CCB will merge with and into NCB (the "Merger"). The Boards of
Directors of CCB and NCB approved the Agreement and the
transactions contemplated therein on March 17, 2000.
Upon the consummation of the Merger, each share of the
Common Stock of CCB ("CCB Common Stock") (with certain
exclusions) issued and outstanding at the effective time of the
Merger (as described in the Agreement, the "Effective Time")
shall be converted into and exchanged for the right to receive
2.45 shares (the "Exchange Ratio") of the Common Stock of NCB
("NCB Common Stock").
In addition, at the Effective Time, all right with respect
to CCB Common Stock, pursuant to stock options granted by CCB
under its existing stock plans, shall be converted into and
become rights with respect to NCB Common Stock on a basis that
reflects the Exchange Ratio.
The Merger is intended to constitute a tax-free
reorganization under the Internal Revenue Code of 1986, as
amended, and to be accounted for as a pooling of interests.
The obligations of CCB and NCB to consummate the Merger are
subject to the following conditions: (i) approval by shareholders
of CCB and NCB; (ii) the qualification for quotation on the
National Market System of The Nasdaq Stock Market, Inc. of the
shares of NCB Common Stock to be issued in the Merger; (iii) the
receipt of regulatory approvals (including approvals from the
Federal Reserve Board and applicable state authorities); (iv) the
effectiveness of a registration statement on Form S-4 with
respect to the offering and exchange of NCB Common Stock in
connection with the Merger; (v) the absence of any injunction or
similar restraint enjoining or making illegal consummation of the
Merger; (vi) the receipt by each of CCB and NCB of favorable
legal opinions as to federal income tax effects of the merger;
(vii) the receipt by each of CCB and NCB of accountant's letters
with respect to the qualification of the Merger for pooling of
interests accounting treatment; (viii) the continuing truth and
accuracy of representations and warranties of CCB and NCB in the
Agreement, except as would not have a Material Adverse Effect (as
defined in the Agreement); and (ix) the performance in all
material respects by each of CCB and NCB of its covenants under
the Agreement.
The Agreement may be terminated, before or after shareholder
approval, in certain circumstances: (i) upon the mutual consent
of CCB and NCB; (ii) by either CCB or NCB if there is any
nonappealable denial of a required regulatory approval or
nonappealable order prohibiting the Merger; (iii) by either CCB
or NCB if the Merger is not consummated within one year of March
17, 2000, unless the failure to consummate is due to a violation
of the Agreement by the party seeking to terminate; or (iv) by
either CCB or NCB if there is a breach of the other party's
representations or warranties that is not cured within 45 days or
curable prior to the Closing Date (as defined in the Agreement)
and that, individually or together with any other such breaches,
would (if occurring on the Closing Date) relieve the party
seeking to terminate of its obligations to consummate the Merger.
CCB and NCB have each granted to the other an irrevocable
option to purchase up to 19.9% of the outstanding Common Stock of
such party. The options are exercisable only upon the occurrence
of certain events relating to competing proposals to acquire or
combine with the issuing party. Each option also permits the
surrender of such option or the shares acquired thereunder for a
cash payment of the value thereof. Each option provides that the
entire option may be surrendered for a cash payment of
$45,000,000. Each option may substantially increase the cost to
a third party of acquiring the issuer of the option and could be
deployed to make it difficult or impossible to account for a
competing transaction as a pooling of interests for a substantial
period of time.
The Agreement and the Merger will be submitted for approval
to the shareholders of each of CCB and NCB. Prior to either
meeting of shareholders, NCB will file a registration statement
with the Securities and Exchange Commission registering, under
the Securities Act of 1933, as amended, the offering of the
shares of NCB Common Stock to be issued in exchange for the
outstanding shares of CCB Common Stock. Such shares of NCB
Common Stock will be offered to CCB's shareholders pursuant to a
prospectus that will also serve as a joint proxy statement for
separate meetings of the shareholders of CCB and NCB.
For additional information regarding the Agreement, the CCB
Stock Option Agreement and the NCB Stock Option Agreement,
reference is made to the copies of those documents which are
incorporated herein by reference and will be filed as a
subsequent amendment to this Form 8-K. The foregoing discussion
is qualified in its entirety by reference to such documents.
Item 7. Financial Statements and Exhibits.
c) Exhibits
Exhibit 99. Press Release dated March 20, 2000
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed
by the undersigned hereunto duly authorized.
CCB FINANCIAL CORPORATION
(Registrant)
Dated March 21, 2000 By: /s/ ERNEST C. ROESSLER
Ernest C. Roessler
Chairman, President and
Chief Executive Officer
For Immediate Release
NCBC Contact: M.J. "Jekka" Ashman
901.523.3525
CCB Financial Contact: Eileen Sarro
919.683.7642
National Commerce Bancorp., CCB Financial to Merge
Agreement to Create Southeast's Premier High-Growth Banking Franchise
MEMPHIS, Tenn./ DURHAM, NC. (March 20, 2000, 4 a.m. EST.) --
National Commerce Bancorporation (Nasdaq:NCBC) and CCB
Financial Corporation (NYSE:CCB) today announced they have
signed a definitive merger of equals agreement creating the
Southeast's premier high-growth banking franchise. The
combined company, which will retain the name National Commerce
Bancorporation, will be headquartered in Memphis, Tennessee,
with its operations headquarters in Durham, North Carolina.
The company will have assets of $15 billion and a pro forma
market capitalization of $4.2 billion.
Under the terms of the agreement, CCB Financial shareholders
will receive 2.45 shares of NCBC common stock. The combined
company's 20-seat board of directors will be made up of 10
directors each from CCB and NCBC. The transaction will be a
tax-free exchange of shares and will be accounted for as a
pooling-of-interests.
Based upon National Commerce Bancorporation's closing share
price on March 17, 2000, the transaction values each CCB
Financial common share at $48.23, a premium of 25 percent to
CCB Financial's closing share price on that date. Common
stockholders of NCBC will have ownership of approximately 53
percent of the combined company, while CCB Financial's common
stockholders will own approximately 47 percent.
The merger, which has been unanimously approved by the boards
of directors of both companies, is conditioned upon standard
regulatory and shareholder approvals and is expected to close
in the third quarter of 2000.
Thomas M. Garrott, chairman and chief executive officer of
NCBC, will become chairman of the combined company, while
Ernest C. Roessler, chairman and chief executive officer of
CCB Financial, will become chief executive officer of National
Commerce
- -more-
Bancorporation upon the closing of the transaction. Both
Garrott and Roessler will co-head the transition team, which
will manage the integration of the new company.
"This transaction builds on the strengths of two highly
successful companies. Both of our companies, which are ranked
by USBanker magazine as being among the top 10 performing
banks in the country, have emphasized high earnings growth and
superior financial and shareholder returns," said Garrott.
"Tom and I share a vision and an operating philosophy of high
growth regional banking," commented Roessler. "This union of
our two companies marries each of their inherent strengths.
NCBC has an unparalleled track record of generating high-
growth and returns in retail banking and is the preeminent
innovator in the area of in-store supermarket banking. CCB
Financial has a long and demonstrated record of building
shareholder value and a core competency in high growth
commercial banking. In addition, both companies have
developed highly attractive non-bank businesses which will
continue to drive the two companies' exceptional growth rates
while also diversifying the earnings streams," he said.
"In addition, our combined banking franchise will have top-
tier market positions in some of the fastest growing regional
economies in the U.S., including the #1 position in deposit
market share in the Research Triangle [Raleigh, Durham and
Chapel Hill, N.C.] and top-three market share positions in the
Triad [Winston-Salem, High Point and Greensboro, N.C.] and in
Memphis," added Roessler. "Our combined business model will
be better balanced going forward to provide both increased
geographic and revenue diversification to our shareholders.
Given our conservative cost savings projections and near
identical technology platforms, we also believe that our
transaction is low risk, especially since revenue synergies we
identified are excluded from the projections."
"By combining both of our companies' core competencies and
best practices," added Garrott, "we can ensure that NCBC will
maximize the financial, product and cultural strengths of our
attractive regional franchise. I look forward to working with
Ernie to sustain NCBC's high growth rate and in delivering to
our combined shareholders returns they associate with our
respective companies," Garrott said.
NCBC will maintain its existing brand names in all markets
outside the Carolinas, while the combined company will operate
as CCB in the Carolinas.
Senior managers who will report directly to Roessler include
William R. Reed Jr., chief operating officer; Sheldon M. Fox,
chief financial officer; J. Scott Edwards, chief
administrative officer; and Lewis E. Holland, president of
financial enterprises. Other key members of the combined
company's management team include Richard L. Furr, who will
serve as president of the banks in both Carolinas, Virginia,
and West Virginia; and David T. Popwell, executive vice
president for mergers and acquisitions.
It is estimated that the combined company will reduce its
operating expenses by approximately $50 million annually,
representing 12 percent of its combined expense base. National
Commerce Bancorporation and CCB Financial have emphasized,
however, that while significant cost savings would be
available through the consolidation of back office and other
non-customer-sensitive functional areas, they have largely
contiguous geographic franchises, mitigating merger
integration risk. The transaction is expected to be 18.8
percent accretive to NCBC's estimated 2001 earnings per share
based on FirstCall estimates and assuming 85 percent phase-in
of the anticipated merger synergies.
- -more-
National Commerce Bancorporation is a $7.3 billion-asset bank
holding company (excludes $500 million in assets in First
Market Bank-Richmond, Va.) based in Memphis, Tennessee. NCBC
operates 162 branches in seven Southeastern states (Tennessee,
Virginia, North Carolina, Georgia, Arkansas, West Virginia and
Mississippi.)
CCB Financial, based in Durham, North Carolina, is an $8.2
billion-asset bank holding company which operates 208 branches
in the Southeastern states of North and South Carolina. The
Trust and Investment Management division has 16 offices in the
Carolinas, Virginia and Florida.
Credit Suisse First Boston provided a fairness opinion and
served as advisor to National Commerce Bancorporation, who was
also advised by Morgan Stanley Dean Witter. J.P. Morgan
provided a fairness opinion and served as exclusive financial
advisor to CCB Financial.
Forward Looking Statements
The matters discussed in this press release contain "forward-
looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995 that involve
substantial risks and uncertainties. Actual results could
differ materially from those described in this press release.
Factors that could cause or contribute to these differences
include, but are not limited to: the risk that the businesses
of NCBC and CCB may not be integrated successfully or within
the time frame envisioned, the risk that the expected
financial results, business opportunities and synergies
anticipated to result from this business combination will not
be achieved or will fail to be achieved within the expected
time frame, and the various matters discussed under the
heading "Management's Discussion and Analysis of Financial
Condition and Results of Operation" in CCB's Annual Report on
Form 10-K for the fiscal year ended December 31, 1999 (filed
with the Securities and Exchange Commission ("SEC") on March
17, 2000) and under the heading "Forward Looking Statements"
in NCBC's Registration Statement on Form S-4 (filed with the
SEC on February 18, 2000).
NOTE --- MEDIA CONFERENCE CALL:
Monday, March 20, 1:00 p.m. EST.
Participant dial-in number is 888.209.3752 (Resv. # 14730184)
Thomas M. Garrott, NCBC chairman, and Ernest C. Roessler,
chairman of CCB Financial will answer questions about today's
announcement. Please dial in approximately 10 minutes prior
to the conference call to assure connectivity.
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