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SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[X] Preliminary Proxy Statement [ ] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec. 240.14a-11(c) or sec. 240.14a-12
United Oklahoma Bankshares, Inc.
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(Name of Registrant as Specified in its Charter
Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(l) and
0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee
is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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UNITED OKLAHOMA BANKSHARES, INC.
4600 S.E. 29TH STREET
DEL CITY, OKLAHOMA 73115
----------------
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON _____________, 1997
A Special Meeting of shareholders of United Oklahoma Bankshares, Inc.
(the "Company") will be held at 4600 S.E. 29th Street, Del City, Oklahoma
73115 on _____________, 1997, at _______ a.m., local time, for the following
purposes:
1. To consider and vote upon a proposal to approve and adopt the
Agreement and Plan of Merger (the "Merger Agreement"), dated as of December 3,
1996, adopted by the Board of Directors of the Company, pursuant to the
recommendation of the Special Committee pursuant to which, among other things,
(a) the Company will be merged into Ameribank Corporation ("Ameribank") with
Ameribank being the surviving corporation (the "Merger"), and (b) all shares of
the Company's Common Stock (the "Common Stock") and Preferred Stock (the
"Preferred Stock") other than the shares of stock owned by Ameribank, will
receive a total consideration of $1,700,000.00 with $0.776901 in cash (rounded
to the nearest $0.01) for each share of Common Stock and $58.35 in cash for
each share of Preferred Stock. Thereafter the Company will be merged into
Ameribank with Ameribank as the sole surviving entity.
2. To transact such other business as may properly come before
the Special Meeting and any adjournment thereof.
The Merger Agreement is attached as ANNEX A to the accompanying Proxy
Statement. Shareholders who do not wish to accept the cash per share payment
and who comply with the requirements of Section 1091 of the Oklahoma General
Corporation Act have the right to seek an appraisal by the District Court of
Oklahoma County, or in any other district court in a county in which any of the
principal officers of the Company reside or may be surrounded of the fair value
of their shares of stock. Each Shareholder who does not vote in favor of the
Merger and who wishes to assert a right to appraisal must make a written demand
for the appraisal of his or her shares of Stock to the Company at the address
set forth below. A VOTE AGAINST THE MERGER SHALL NOT CONSTITUTE A DEMAND FOR
APPRAISAL OF STOCK. Failure to make such demand before the vote is taken to
approve the Merger will eliminate a Shareholder's right to an appraisal. The
demand must reasonably inform the Company of the identity of the Shareholder
making the demand as well as the intention of such Shareholder to demand an
appraisal of the fair value of the shares of Stock held by such Shareholder.
For purposes of making an appraisal demand, the address of the Company
is: United Oklahoma Bankshares, Inc., 4600 S.E. 29th Street, Del City, Oklahoma
73115, Attention: D. Wesley Schubert, President.
For a further description of the rights of shareholders pursuant to
Section 1091 and the procedures thereunder, see "Appraisal Rights" in the
accompanying Proxy Statement. A copy of the text of Section 1091 is attached
as ANNEX B to the accompanying Proxy Statement. The Proxy Statement and the
ANNEXES form a part of this Notice.
The Board of Directors of the Company has fixed the close of business
on _____________, 1997 as the record date for determining the shareholders
entitled to notice of and to vote at the Special Meeting and any adjournment
thereof. The affirmative vote of holders of a majority of the outstanding
shares Common Stock and Preferred Stock each voting as a class is required to
approve and adopt the Merger Agreement. The Merger does not require the
approval of a majority of the shareholders of the Company other than Ameribank.
Because Ameribank owns approximately 61.58% of the Common Stock and 88.85% of
the Preferred Stock and intends to vote all of such shares in favor of the
Merger Agreement, approval and adoption of the Merger Agreement is expected.
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PLEASE SIGN AND RETURN THE ENCLOSED PROXY CARD PROMPTLY TO ENSURE YOUR
REPRESENTATION AT THE SPECIAL MEETING, WHETHER OR NOT YOU PLAN TO ATTEND. YOUR
PROXY MAY BE REVOKED BY YOU AT ANY TIME BEFORE IT IS VOTED AT THE SPECIAL
MEETING. PROXIES MAY BE REVOKED BY FILING WITH THE SECRETARY OF THE COMPANY
WRITTEN NOTICE OF REVOCATION BEARING A LATER DATE THAN THE PROXY, BY DULY
EXECUTING AND DELIVERING TO THE SECRETARY OF THE COMPANY, AT OR PRIOR TO THE
SPECIAL MEETING, A SUBSEQUENT PROXY RELATING TO THE SAME SHARES OF STOCK, OR BY
ATTENDING THE SPECIAL MEETING AND VOTING IN PERSON (ALTHOUGH ATTENDANCE AT THE
SPECIAL MEETING WILL NOT, BY ITSELF, CONSTITUTE A REVOCATION OF PROXY). ANY
WRITTEN NOTICE REVOKING A PROXY SHOULD BE SENT TO UNITED OKLAHOMA BANKSHARES,
INC., 4600 S.E. 29TH STREET, DEL CITY, OKLAHOMA 73115.
George N. Cook, Jr., Chairman
Oklahoma City, Oklahoma
_____________, 1997
PLEASE COMPLETE, DATE, SIGN AND RETURN THE ENCLOSED PROXY PROMPTLY,
WHETHER OR NOT YOU INTEND TO BE PRESENT AT THE SPECIAL MEETING.
PLEASE DO NOT SEND IN ANY CERTIFICATES FOR YOUR SHARES AT THIS TIME.
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UNITED OKLAHOMA BANKSHARES, INC.
4600 S.E. 29TH STREET
DEL CITY, OKLAHOMA 73115
(405) 677-8711
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PROXY STATEMENT FOR SPECIAL MEETING OF SHAREHOLDERS
---------------------------
INTRODUCTION
This Proxy Statement is being furnished to shareholders (the
"Shareholders") of United Oklahoma Bankshares, Inc., an Oklahoma corporation
(the "Company"), in connection with the solicitation of proxies by the Board of
Directors of the Company (the "Board") for use at the Company's Special Meeting
of Shareholders to be held on ____________, 1997 and at any adjournment or
postponement thereof (the "Special Meeting").
MATTERS TO BE CONSIDERED AT THE MEETING
At the Special Meeting, Shareholders will be asked to approve the
Agreement and Plan of Merger, dated as of December 3, 1996 (the "Merger
Agreement"), between the Company and Ameribank Corporation ("Ameribank"). The
Merger Agreement provides for the merger (the "Merger") of the Company into
Ameribank and for the payment of $1,700,000 by Ameribank to the Shareholders
(other than Ameribank) of the Company for the acquisition by Ameribank of all
shares of the Common Stock, par value $1.00 per share (the "Common Stock"),
and 9% Cumulative Non-Voting Preferred Stock, par value $30.00 per share (the
"Preferred Stock"), in the Company which are not owned by Ameribank (Common
Stock and Preferred Stock are collectively referred to herein as the "Stock").
Ameribank owns approximately 62% of the Common Stock and 89% of the Preferred
Stock. If the Merger is consummated, Ameribank will pay $1,700,000 (the "Total
Consideration") for the Stock, at the rate of $0.776901 cash per share (rounded
to the nearest $0.01) for Common Stock (the "Common Consideration") and $58.35
cash per share for Preferred Stock (the "Preferred Consideration"). The Merger
will become effective as of the filing of a Certificate of Merger consistent
with the Merger Agreement, with the Secretary of State of the State of Oklahoma
(the "Effective Time"). As a result of the Merger, the Company will be merged
into Ameribank and Ameribank will be the surviving entity. A copy of the
Merger Agreement is attached to this Proxy Statement as ANNEX A. At the
Effective Time, each share of the Common Stock outstanding immediately prior to
the Effective Time (other than shares of Common Stock held by Ameribank) will
be converted into the right to receive the Common Consideration in cash,
without interest, and each share of the Preferred Stock outstanding immediately
prior to the Effective Time (other than shares of Preferred Stock held by
Ameribank) will be converted into the
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right to receive the Preferred Consideration in cash, without interest. See
"SPECIAL FACTORS" and "THE MERGER."
---------------------------------------------------
THIS TRANSACTION HAS NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION (THE "COMMISSION") NOR HAS THE COMMISSION PASSED UPON THE
FAIRNESS OR MERITS OF SUCH TRANSACTION NOR UPON THE ACCURACY OR ADEQUACY OF THE
INFORMATION CONTAINED IN THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS
UNLAWFUL.
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The date of this Proxy Statement, and the approximate date it will be
mailed to Shareholders, is ___________, 1997.
VOTING AT THE MEETING
The Board has fixed the close of business on ___________, 1997 as the
record date (the "Record Date") for determining the holders of Stock entitled
to notice of, and to vote at, the Special Meeting. As of the Record Date,
there were (i) 2,532,237 shares of Common Stock and 145,199 shares of Preferred
Stock outstanding and entitled to vote and (ii) approximately 450 holders of
record of Common Stock and 86 holders of record of Preferred Stock. The
presence, in person or by properly executed proxy, of a majority of the
outstanding shares of the Common Stock and Preferred Stock, respectively, is
necessary to constitute a quorum at the Special Meeting. Each shareholder is
entitled to one vote for each share of Common Stock held by such shareholder
and one vote for each share of Preferred Stock held by such shareholder.
Under Oklahoma law, the affirmative vote of holders of a majority of the
outstanding shares of Common Stock and Preferred Stock, each voting as a class
is required to approve the Merger. Because Ameribank, which owns approximately
6l.58% of the Common Stock and 89% of the Preferred Stock, intends to vote its
shares in favor of the Merger, approval of the Merger Agreement is expected.
APPRAISAL RIGHTS
Under Section 1091 of the Oklahoma General Corporation Act ("OGCA"),
holders of record of shares of Stock who do not wish to accept the Common
Consideration or Preferred Consideration and who have neither voted in favor of
the Merger nor consented to it in writing have the right to seek an appraisal
of the fair value of their shares of Stock in the District Court of Oklahoma
County, or in any other district court in a county in which any of the
principal officers of the Company reside or may be summoned (the "District
Court"). A vote in favor of the Merger or a consent to it in writing
constitutes a waiver of such appraisal rights. In addition, Shareholders who
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vote in favor of the Merger may later be estopped from challenging the Merger
in a subsequent lawsuit. See "SPECIAL FACTORS - - Appraisal Rights" and ANNEX
B.
PROXIES
All shares of Stock represented at the Special Meeting by properly
executed proxies received prior to or at the Special Meeting, unless such
proxies previously have been revoked, shall be voted at the Special Meeting in
accordance with the instructions on the proxies. IF NO SUCH INSTRUCTIONS ARE
INDICATED, PROXIES WILL BE VOTED FOR THE APPROVAL OF THE MERGER AGREEMENT. As
noted under "Appraisal Rights" herein, a vote FOR the approval of the Merger
will constitute a waiver of the appraisal rights associated with the Stock.
The Board does not know of any other matters which are to come before the
Special Meeting. If any other matters are properly presented at the Special
Meeting for action, the persons named in the enclosed form of proxy and acting
thereunder will have the discretion to vote on such matters in accordance with
their best judgment.
Any proxy given pursuant to this solicitation may be revoked by the person
giving the proxy at any time before it is voted. Proxies may be revoked by
filing with the Secretary of the Company written notice of revocation bearing a
date later than the proxy, by duly executing and delivering to the Secretary of
the Company, at or prior to the Special Meeting, a subsequent proxy relating to
the same shares of Stock, or by attending the Special Meeting and voting in
person (although attendance at the Special Meeting will not, by itself,
constitute a revocation of proxy). Any written notice revoking a proxy should
be sent to United Oklahoma Bankshares, Inc., 4600 S.E. 29th Street, Del City,
Oklahoma 73115.
Proxies are being solicited by and on behalf of the Board. Ameribank,
however, will bear the cost of preparing and mailing the proxy material
furnished to the Company's Shareholders in connection with the Special Meeting.
Proxies will be solicited by mail. While it is not anticipated that such will
be the case, directors, officers and employees of the Company may also solicit
proxies by telephone, telegram or personal contact. Such persons will receive
no additional compensation for such services but may be reimbursed for
out-of-pocket expenses in connection with such solicitation. Copies of
solicitation materials will be furnished to fiduciaries, custodians and
brokerage houses for forwarding to beneficial owners of Stock held in the names
of such fiduciaries, custodians and brokerage houses.
All information contained in this Proxy Statement concerning Ameribank and
the plans related to the Company after the Merger has been supplied by
Ameribank. All other information contained in this Proxy Statement has been
supplied by the Company.
POSITION OF THE COMPANY'S BOARD; CONFLICTS OF INTEREST
The Board appointed a Special Committee (the "Special Committee"),
composed of two directors who are not affiliated with Ameribank, to consider
the proposal of Ameribank for a Merger with the Company. Pursuant to the
recommendations of the Special Committee, the Board determined that the
acquisition of the Stock by Ameribank pursuant to the Merger Agreement is in
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the best interests of the Company and the Shareholders (other than Ameribank)
and has approved the Merger Agreement. George K. Baum & Company ("Baum &
Company"), the Special Committee's financial advisor, has advised the Special
Committee that, in its opinion, based on certain assumptions, the Merger is
fair, from a financial point of view, to the Shareholders of the Company (other
than Ameribank).
No person is authorized to give information or make any representation not
contained in this Proxy Statement, and, if given or made, such information or
representation should not be relied upon as having been authorized. The
delivery of this Proxy Statement shall not, under any circumstances, create any
implication that there has been no change in the information set forth herein
or in the affairs of the Company or Ameribank since the date hereof.
ADDITIONAL INFORMATION
Pursuant to the requirements of Section 13(e) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act") and Rule 13e-3 promulgated
thereunder, the Company, as issuer of the class of equity securities which is
the subject of the Rule 13e-3 transaction, together with Ameribank, has filed
with the Commission a Transaction Statement on Schedule 13E-3 (the "Schedule
13E-3") relating to the transactions contemplated by the Merger Agreement. As
permitted by the rules and the regulations of the Commission, this Proxy
Statement omits information, exhibits and undertakings contained in the
Schedule 13E-3. Such additional information can be inspected at and obtained
from the Commission in the manner set forth below under "AVAILABLE
INFORMATION."
Statements contained herein concerning any documents are not necessarily
complete and, in each instance, reference is made to the copy of such document
filed as an exhibit to the Schedule 13E-3. Each such statement is qualified in
its entirety by such reference.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Exchange
Act and, in accordance therewith, is required to file periodic reports, proxy
statements and other information with the Commission relating to its business,
financial statements and other matters. Such reports, proxy statements and
other information filed by the Company, as well as the Schedule 13E-3, may be
inspected and copied at the public reference facilities maintained by the
Commission at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and
may be available at the Regional Offices of the Commission located at 500 West
Madison Avenue, Suite 1400, Chicago, Illinois 60661, Seven World Trade Center,
13th Floor, New York, New York 10048, and on the Commission's web site on the
World Wide Web at: http://www.sec.gov. Copies of such material can also be
obtained from the Commission at prescribed rates by addressing written requests
for such copies to the Public Reference Section of the Commission at 450 Fifth
Street, N.W. Washington, D.C. 20549.
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THIS PROXY STATEMENT INCORPORATES DOCUMENTS BY REFERENCE WHICH ARE NOT
PRESENTED OR DELIVERED. THESE DOCUMENTS ARE AVAILABLE WITHOUT CHARGE UPON
REQUEST FROM THE CORPORATE SECRETARY'S OFFICE, UNITED OKLAHOMA BANKSHARES,
INC., 4600 S.E. 29TH STREET, DEL CITY, OKLAHOMA 73115 TELEPHONE NUMBER (405)
677-8711. IN ORDER TO ENSURE TIMELY DELIVERY OF THE DOCUMENTS, ANY REQUEST
SHOULD BE MADE NO LATER THAN ____________.
INFORMATION INCORPORATED BY REFERENCE
The following documents are incorporated by reference into this
Proxy Statement:
The Company's Annual Report on Form 10-K for the years
ended December 31, 1996, December 31, 1995, December
31, 1994 and December 31, 1993; provided that attached
hereto as Exhibit 13(a)-(d) are signed copies of the
accountants' reports for the above Annual Reports;
The Company's Quarterly Report on Form 10-Q for the quarter ending
March 31, 1997; and
All other documents filed by the Company pursuant to Section 13(a)
or 15(d) of the Exchange Act after December 31, 1995, and prior to
the date of the Special Meeting on Stockholders to be held on
___________________.
Any statement contained in a document filed with the Commission prior to
the date of this Proxy Statement and incorporated by reference is modified or
superseded to the extent that a statement contained in this Proxy Statement (or
in any other subsequently filed document which also is incorporated by
reference) modifies or supersedes such statement. The modifying or superseding
statement may, but need not, state that it has modified or superseded a prior
statement or include any other information set forth in the document that is
not modified or superseded. The making of a modifying or superseding statement
shall not be deemed an admission that the modified or superseded statement,
when made, constituted an untrue statement of a material fact, an omission to
state a material fact necessary to make a statement not misleading, or the
employment of a manipulative, deceptive or fraudulent device, contrivance,
scheme, transaction, act, practice, course of business or artifice to defraud,
as those terms are used in the Securities Act of 1933, as amended (the
"Securities Act"), the Exchange Act or the rules and regulations thereunder.
Any statement so modified shall not be deemed in its unmodified form to
constitute a part hereof for purposes of the Exchange Act. Any statement so
superseded shall not be deemed to constitute a part hereof for purposes of the
Exchange Act.
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TABLE OF CONTENTS
<TABLE>
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PAGE
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INTRODUCTION ............................................................... 1
Matters to be Considered at the Meeting ............................... 1
Voting at the Meeting ................................................. 2
Appraisal Rights ...................................................... 2
Proxies ............................................................... 3
Position of the Company's Board; Conflicts of Interest ................ 3
ADDITIONAL INFORMATION ..................................................... 4
AVAILABLE INFORMATION ...................................................... 4
INFORMATION INCORPORATED BY REFERENCE ...................................... 5
SUMMARY .................................................................... 9
The Special Meeting ................................................... 9
The Merger ............................................................ 9
Required Vote ......................................................... 9
Appraisal Rights ...................................................... 10
The Effective Time .................................................... 10
Background of the Merger .............................................. 11
Recommendation of Board of Directors and the Special Committee ........ 13
Opinion of Financial Advisor .......................................... 15
Fairness of the Transaction ........................................... 15
Interests of Certain Persons in the Merger; Conflicts of Interest ..... 15
Financing of the Merger ............................................... 16
Expenses of the Merger ................................................ 17
Conditions to the Merger .............................................. 17
Exchange of Certificates .............................................. 17
Federal Income Tax Consequences ....................................... 17
Certain Litigation Concerning the Proposed Merger ..................... 18
Business of the Company ............................................... 18
Selected Consolidated Financial Data .................................. 18
Dividends ............................................................. 18
SPECIAL FACTORS ............................................................ 19
Background of the Merger .............................................. 19
Appointment of and Deliberations by the Special Committee ............. 21
Proceedings of the Board and Recommendation of the Special Committee .. 30
Fairness of the Transaction ........................................... 31
Opinion of Financial Advisor .......................................... 32
Structure and Purpose of the Merger ................................... 34
</TABLE>
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<TABLE>
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Alternatives to the Merger ............................................ 34
Certain Effects of the Merger ......................................... 35
Interests of Certain Persons in the Merger; Conflicts of Interest ..... 36
Certain Federal Income Tax Consequences of the Merger ................. 37
Appraisal Rights ...................................................... 38
Financing of the Merger ............................................... 41
Expenses of the Merger ................................................ 42
Certain Litigation Concerning the Proposed Merger ..................... 42
THE MERGER ................................................................. 42
General ............................................................... 42
Required Vote ......................................................... 42
Effective Time ........................................................ 43
Payment for Shares of Common Stock and Preferred Stock ................ 43
Conditions to the Merger; Waiver ...................................... 44
Certain Covenants of the Company and Ameribank ........................ 46
Termination and Amendments ............................................ 46
No Third-Party Beneficiaries .......................................... 46
CERTAIN INFORMATION REGARDING AMERIBANK .................................... 47
DESCRIPTION OF CAPITAL STOCK OF THE COMPANY ................................ 48
Capital Stock ......................................................... 48
Recent Market Prices .................................................. 49
Dividends ............................................................. 49
BUSINESS OF THE COMPANY .................................................... 49
Overview .............................................................. 49
Transactions with Affiliates .......................................... 50
Selected Consolidated Financial Data .................................. 50
Management's Position Regarding the Results of
Operations and Financial Condition of the Company ..................... 52
BENEFICIAL OWNERSHIP OF SHARES ............................................. 53
Beneficial Ownership .................................................. 53
Certain Transactions in Common Stock and Preferred Stock .............. 55
Proxy Solicitation .................................................... 56
Current Information: Delisting and Deregistration ..................... 57
Independent Auditors .................................................. 57
Future Stockholder Proposals .......................................... 57
Other Business ........................................................ 57
ANNEX A: AGREEMENT AND PLAN OF MERGER, AS AMENDED .......................... 58
</TABLE>
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<TABLE>
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ANNEX B: SECTION 1091 OF THE OKLAHOMA
GENERAL CORPORATION ACT .................................................... 75
ANNEX C: OPINION OF GEORGE K. BAUM & COMPANY,
DATED OCTOBER 25, 1996 ..................................................... 80
ANNEX D: SUPPLEMENTAL LETTER OF GEORGE K. BAUM &
COMPANY, DATED JANUARY 23, 1997 ............................................ 83
</TABLE>
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SUMMARY
The following is a summary of information contained in this Proxy
Statement. This summary is not intended to be a complete statement of all
material features of the Merger and is qualified in its entirety by reference
to the more detailed information appearing elsewhere in this Proxy Statement,
including the attached Annexes. Terms used but not defined in this summary
have the meanings described to them elsewhere in this Proxy Statement.
Shareholders are urged to read this Proxy Statement and the Annexes in their
entirety.
THE SPECIAL MEETING
A Special Meeting of Shareholders of the Company will be held on
____________ 1997 at _______ a.m. local time, at 4600 S.E. 29th Street, Del
City, Oklahoma 73115, to consider and vote on a proposal adopted by the Board
of Directors, pursuant to the recommendations of the Special Committee, to
approve the Merger Agreement between the Company and Ameribank, which provides
for the merger of the Company into Ameribank. A copy of the Merger Agreement
is attached as ANNEX A. See "INTRODUCTION."
THE MERGER
The Merger Agreement provides that, subject to the approval of the Merger
Agreement by the Shareholders of the Company and satisfaction of other
conditions, the Company will be merged into Ameribank, with Ameribank being the
surviving corporation. Ameribank owns 1,559,498 shares, or approximately 62%,
of the outstanding Common Stock and 129,016 shares of Preferred Stock,
representing approximately 89% of the outstanding Preferred Stock of the
Company. Pursuant to the Merger Agreement, each share of Common Stock
outstanding, other than shares held by Ameribank, will be automatically
converted into the Common Consideration. In addition, each share of Preferred
Stock outstanding, other than shares held by Ameribank, will be automatically
converted into the Preferred Consideration. In connection with, and only in
connection with the consummation of the Merger, Ameribank has agreed to cancel,
simultaneously with the consummation of the Merger, the shares of Common Stock
and Preferred Stock owned by it and has waived its right to receive any of the
Total Consideration. After consummation of the Merger, the entire equity
interest in the Company will be owned by Ameribank and Ameribank will be the
sole surviving entity. See "THE MERGER," "SPECIAL FACTORS -- Interests of
Certain Persons in the Merger; Conflicts of Interest" and "SPECIAL FACTORS --
Certain Effects of the Merger."
REQUIRED VOTE
Under Oklahoma law, the affirmative vote of the holders of a majority of
the shares of Common Stock voting as a class and Preferred Stock voting as a
class at the Special Meeting is required for approval of the Merger Agreement.
Because Ameribank, which owns approximately 62% of the Common Stock and 89% of
the Preferred Stock, intends to vote its shares in favor of the Merger,
approval and adoption of the Merger Agreement is expected.
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APPRAISAL RIGHTS
Under Section 1091 of the OGCA, holders of record of shares of Common
Stock or Preferred Stock who do not wish to accept the Common Consideration or
Preferred Consideration have the right to seek an appraisal to determine the
fair value of their shares of Common Stock or Preferred Stock in the District
Court.
Each Shareholder who has not voted in favor of the Merger and who wishes
to assert a right to appraisal must make a written demand to the Company which
reasonably informs the Company of the Shareholder's identity and his or her
intention to demand an appraisal for his or her shares of Stock. Failure to
make such demand before the vote is taken to approve the Merger will eliminate
a Shareholder's right to an appraisal.
Within 120 days after the Effective Time (the "120-Day Period"), any
Shareholder who has properly demanded an appraisal and who has not withdrawn
his or her demand (such Shareholders are hereinafter referred to collectively
as the "Dissenting Shareholders") has the right to file in the District Court a
petition (the "Petition") demanding a determination of the fair value of the
shares of Stock (the "Dissenting Shares") held by all of the Dissenting
Shareholders. If, within the 120-Day Period, no Petition shall have been filed
as provided above, all rights to an appraisal will cease and all of the
Dissenting Shareholders will receive the Common Consideration or Preferred
Consideration, without interest, applicable to such Dissenting Shares. The
Company is not obligated and does not intend to file a Petition.
Upon the filing of the Petition, service of a copy is required to be made
upon the surviving corporation, which shall, within 20 days after such service,
file in the office of the court in which the Petition was filed, a duly
verified list containing the names and addresses of all Dissenting
Shareholders. The District Court may order that notice of the time and place
fixed for the hearing on the Petition be sent by registered or certified mail
to the surviving corporation and all of the Dissenting Shareholders, and be
published at least one week before the day of the hearing in a newspaper of
general circulation published in the City of Oklahoma City, Oklahoma, or in
another publication determined by the District Court. If a hearing on the
Petition is held, the District Court is empowered to determine which Dissenting
Shareholders have complied with the provisions of Section 1091 of the OGCA and
are entitled to an appraisal of their shares of Common Stock. See "SPECIAL
FACTORS -- Appraisal Rights" and ANNEX B.
THE EFFECTIVE TIME
The Merger will become effective as of the filing of a Certificate of
Merger, consistent with the Merger Agreement, with the Secretary of State of
the State of Oklahoma. The Merger will be consummated only upon satisfaction
or waiver, where permissible, of the terms and conditions contained in the
Merger Agreement and provided that the Merger Agreement has not been
terminated. The Merger Agreement may be terminated by the mutual written
consent of the Company and Ameribank and Ameribank may terminate the Merger
Agreement at any time if there has been a material adverse change in the
business, assets, financial condition or prospects of the Company. If the
Merger has not been consummated by August 1, 1997, either the Company or
<PAGE> 14
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Ameribank may terminate the Merger Agreement so long as the reason that the
Merger has not been consummated is not due to the failure of the party choosing
to terminate to fulfill any of its obligations thereunder. No such waiver or
termination will require the vote or consent of the holders of Common Stock or
Preferred Stock.
BACKGROUND OF THE MERGER
In May 1995 Ameribank and certain shareholders of the Company reached an
agreement whereby Ameribank would acquire 27.7% of the outstanding Common Stock
and 63.9% of the outstanding Preferred Stock from the selling shareholders. In
July, 1995, Ameribank acquired additional shares of Preferred Stock and in
October entered into two separate Stock Purchase Agreements for a total of
150,000 shares of Common Stock. On November 3, 1995, Ameribank commenced a
tender offer for the purchase of additional shares of Common Stock and on
December 29, 1995 at the termination of the tender offer, Ameribank had
acquired 588,146 additional shares of Common Stock. Ameribank has purchased
additional shares of Common Stock and Preferred Stock in several private
transactions and now holds 62% of outstanding Common Stock and 89% of the
outstanding Preferred Stock. See "SPECIAL FACTORS--Background of the Merger"
and "BENEFICIAL OWNERSHIP OF SHARES--Certain Transactions in Common Stock and
Preferred Stock."At a Special Meeting of the Board held on June 14, 1996,
Ameribank presented a written proposal to merge the Company into Ameribank for
a cash price of $1,300,000 for all of the outstanding shares of Common Stock
and Preferred Stock of the Company not already owned by Ameribank, subject to
certain conditions.
Because three of the five members of the Board were affiliated with
Ameribank, the Board appointed a Special Committee of the Board of Directors
comprised of Mr. Nichols and Mr. Rappaport. Neither Mr. Nichols nor Mr.
Rappaport have any financial or personal interest in Ameribank and neither of
them are officers, directors, employees or stockholders of Ameribank. The
Special Committee's role was to: (i) evaluate any offer by Ameribank to merge
the Company with Ameribank; (ii) negotiate the terms and conditions of any cash
merger with Ameribank; and (iii) make a recommendation to the Board of
Directors of the Company. The Shareholders were advised of the Ameribank
proposal and appointment of a Special Committee by letter dated June 17, 1996
from George N. Cook, Jr. ("Mr. Cook") the Chairman of the Board. See "SPECIAL
FACTORS -- Appointment of and Deliberations by the Special Committee."
In July 1996, the Special Committee interviewed representatives of several
law firms and investment banking firms to obtain legal counsel and financial
advice for the Special Committee in the performance of its duties and to assist
the Special Committee in its negotiations with Ameribank. The Special
Committee retained the law firm of Conner & Winters (the "Special Committee
Counsel") and the investment banking firm of George K. Baum & Company ("Baum &
Company"), both of which have experience in transactions as proposed by
Ameribank. On August 5, 1996, the Special Committee sent a letter to the
Shareholders notifying them of the engagement of a financial advisor and legal
counsel. The Special Committee also, based on a recommendation by the Special
Committee Counsel, authorized the Chairman of the Special
<PAGE> 15
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Committee to interview and recommend to the Special Committee employment of an
appraiser to perform an appraisal on the bank building (the "Bank Tower")
located in Del City, Oklahoma and owned by United Bank, Del City, Oklahoma
("United"), the wholly owned subsidiary of the Company. See "SPECIAL
FACTORS--Appointment of and Deliberations by the Special Committee."
On July 23, 1996 the Special Committee met with representatives of, and
legal counsel for Ameribank. Ameribank agreed to extend expiration of its
offer from August 1, 1996 to November 1, 1996. Ameribank further indicated its
offer of $1,300,000 was based, in part, on an appraisal of United by GRA, Petty
& Co. The Special Committee requested a copy of the report by GRA, Petty & Co.
and an explanation of how Ameribank determined the $1,300,000 price in its
offer.
On August 16, 1996, the Special Committee met with representatives of the
Special Committee Counsel, Baum & Company and the Company. The Company was
instructed on how to assist Baum & Company in its review of the Company's
records. The Company and Baum & Company were also advised by the Special
Committee Counsel of the current law in Oklahoma and Delaware to be considered
when determining the fair value of the Company. At the meeting, the Special
Committee further discussed various valuation issues of the minority shares of
the Company; including, the difficulty in selling the minority Stock to a buyer
other than Ameribank and the current trading price of the Stock.
By letter dated September 5, 1996, counsel for Ameribank advised the
Special Committee of the method used by Ameribank in determining the $1,300,000
offer, which included a minority discount of the Stock. In this letter,
counsel for Ameribank further advised that Ameribank had not received any
offers to purchase the Company and that Ameribank would provide the Special
Committee with a copy of the GRA, Petty & Co. appraisal at such time as the
Special Committee informed Ameribank that it has developed a reasonable basis
for valuation of the minority Stock.
On October 18, 1996 the Special Committee had a meeting to discuss
valuation of the minority Stock by representatives of Baum & Company and to
review the appraisal performed by R.W. Finley & Co., Inc. of the Bank Tower.
As of August 31, 1996, the appraisal estimated the value of the Bank Tower at
$2,950,000. The Special Committee and Baum & Company then reviewed the
proposed opinion of Baum & Company concerning the valuation of the Company.
The Special Committee was advised by Baum & Company that a price of $58.35 per
share for the minority held Preferred Stock and $0.754 per share for the
minority held Common Stock, being a valuation without a minority discount and
which came to a total of $1,679,131 for the minority Stock, was fair from a
financial point of view based upon Baum & Company's methods for determining
value. Baum & Company delivered its written fairness opinion, dated October
25, 1996 to the Special Committee. At the same meeting, the Special Committee
Counsel advised the Special Committee that minority discounts are not
appropriate under Oklahoma and Delaware law.
<PAGE> 16
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RECOMMENDATION OF BOARD OF DIRECTORS AND THE SPECIAL COMMITTEE
On October 28, 1996, the Special Committee met with representatives of
Ameribank to negotiate the price offered for the Common Stock and the Preferred
Stock not owned by Ameribank. As a result of these negotiations, the Special
Committee recommended to the Board that a revised proposal by Ameribank be
accepted. Under the revised proposal, Ameribank would pay a total of
$1,700,000 for all the shares of Stock not owned by Ameribank with $58.35 per
share allocated to holders of Preferred Stock and the balance to be paid to
holders of Common Stock. The Special Committee's financial advisor advised the
Special Committee that, in the advisor's opinion, consideration in these
amounts is fair from a financial point of view. Based upon the recommendations
of the Special Committee, the Board approved the proposed Merger. See "SPECIAL
FACTORS--Appointment of and Deliberations by the Special Committee".
Mr. Cook wrote to the Shareholders on November 4, 1996, notifying them of
the revised proposal and stating that completion of the proposed merger
transaction was subject to preparation of a mutually satisfactory merger
agreement with Ameribank, certain filings and approvals with regulatory
agencies and approval by vote of holders of a majority of the shares of Common
Stock and Preferred Stock, each voting as a class at a Special Shareholder's
meeting. On December 3, 1996, the Special Committee met with the Special
Committee's Counsel to review the proposed Merger Agreement with Ameribank.
The members of the Special Committee approved the Merger Agreement and passed a
recommendation that the Board enter into the Merger Agreement. Following the
meeting of the Special Committee, the Board met to consider the Special
Committee's recommendation and after discussion, voted to approve the Merger
Agreement as recommended by the Special Committee and to authorize the
execution of the Merger Agreement on behalf of the Company. Mr. Cook again
wrote to the Shareholders on December 5, 1996, advising the Shareholders of the
execution of the Merger Agreement and stating that completion of the Merger was
subject to preparation of all necessary filings and approvals with regulatory
agencies and the approval by vote of holders of a majority of the shares of the
Company's Common Stock and Preferred Stock, each voting as a class at a Special
Shareholder's meeting. See "SPECIAL FACTORS -- Appointment of and
Deliberations by the Special Committee."
On December 12, 1996, the Company filed a Current Report on Form 8-K with
the Commission reporting the Merger Agreement between Ameribank and the
Company.
During the first part of January 1997, counsel for Ameribank provided the
Special Committee Counsel with copies of certain Form 4s, which indicated that
from January 1, 1996 through June 30, 1996, Ameribank bought Preferred and
Common Stock from certain shareholders of the Company at a price between $18.00
and $49.50 per share for Preferred Stock and not more than $0.50 per share for
Common Stock. The Special Committee Counsel forwarded the Form 4s to the
Special Committee and Baum & Company.
As a result of the additional information in the Forms 4, the Special
Committee, along with the Special Committee Counsel held a telephonic meeting
on January 14, 1997, with a representative of Baum & Company. In light of the
information provided in the Form 4s, the Special Committee inquired of Baum &
Company as to whether the fairness opinion of Baum &
<PAGE> 17
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Company, dated October 25, 1996, would change and whether the $1,700,000 total
purchase price to be paid by Ameribank for the Common Stock and Preferred Stock
held by non-Ameribank Shareholders was still fair from a financial point of
view. Baum & Company's representative advised that there was no need to
redetermine if the Total Consideration was fair from a financial point of view
since Ameribank was offering $58.35 per share for the Preferred Shares and
$0.754 per share for the Common Stock which was a premium over the highest
price of $49.50 and $0.50 previously paid by Ameribank for the Preferred Stock
and Common Stock, respectively, as indicated in the Form 4s. As a result,
Baum & Company determined the Merger was still fair from a financial point of
view.
The Special Committee reaffirmed its approval and recommendation to the
Board of the Merger, subject to (i) Ameribank or its counsel certifying that
during the past twelve (12) months the maximum price paid by Ameribank has not
exceeded $49.50 and $ 0.50 for Preferred and Common Stock, respectively, and
(ii) receipt of the supplemental fairness opinion from Baum & Company that the
aggregate price of $1,700,000 to be paid by Ameribank to non-Ameribank
Shareholders is fair from a financial point of view, as set forth in Baum &
Company's fairness letter of October 25, 1996.
As requested by the Special Committee, Ameribank's counsel informed the
Special Committee Counsel that (i) Ameribank has not paid more than $0.50 per
share for shares of Common Stock, and (ii) Ameribank made an offer in July,
1995, to purchase shares of Preferred Stock for $18.00 per share and
subsequently acquired additional shares of Preferred Stock through private
purchases at amounts between $18.00 and $49.50 per share. Ameribank further
advised that it had entered into separate stock purchase agreements with
several Shareholders of the Company, which agreements provided that if within
one (1) year form the date of the stock purchase agreement, Ameribank should
enter into a merger with the Company in which Ameribank pays a higher price,
Ameribank will pay the sellers the difference in cash. Ameribank also provided
the Special Committee Counsel copies of these stock purchase agreements.
By letter dated January 23, 1997 to the Special Committee, Baum & Company
issued its supplemental opinion which indicated that, even with the additional
information regarding the Preferred Stock purchased by Ameribank, Baum &
Company finds the Total Consideration to be paid to the holders of Common and
Preferred Stock to be fair from a financial point of view, as set forth in its
letter dated October 25, 1996.
On January 27, 1997, the Special Committee, along with the Special
Committee's Counsel held a telephonic meeting. After review of the letter from
Ameribank's counsel dated January 16, 1997, and the supplemental fairness
opinion issued by Baum & Company dated January 23, 1997, the Special Committee
reaffirmed its approval and recommendation to the Board that the Merger should
be consummated for an aggregate price of $1,700,000. For a description of the
factors considered in the determination of the Common Consideration and the
Preferred Consideration and the fairness of the transaction, see "SPECIAL
FACTORS -- Appointment of and Deliberations by the Special Committee --
Fairness of the Transaction, -- Opinion of the Financial Advisor." For a
description of the events leading up to the approval of the Merger Agreement,
see "SPECIAL FACTORS -- Background of the Merger."
<PAGE> 18
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For a discussion of the factors considered by the Board in reaching its
determination, see "SPECIAL FACTORS -- Proceedings of the Board and
Recommendation of the Special Committee -- Fairness of the Transaction and --
Opinion of the Financial Advisor."
THE BOARD HAS APPROVED THE MERGER AGREEMENT EVEN THOUGH MEMBERS OF THE
BOARD HAVE CERTAIN INTERESTS WHICH MAY PRESENT THEM WITH CONFLICTS OF INTEREST
IN CONNECTION WITH THE MERGER. See "SPECIAL FACTORS -- Interest of Certain
Persons in the Merger; Conflicts of Interest."
OPINION OF FINANCIAL ADVISOR
The Special Committee engaged Baum & Company to act as its financial
advisor in connection with the Merger and related matters. Prior to the Board
meeting on October 28, 1996, Baum & Company delivered to the Special Committee
its written opinion that the Merger is fair from a financial point of view to
Shareholders (other than Ameribank). The full text of the opinion of Baum &
Company, which sets forth the procedures followed, matters considered and
assumptions made in connection with rendering such opinion is attached as ANNEX
C and should be read in its entirety as should the supplemental letter of Baum
& Company, dated January 23, 1997, attached as ANNEX D. For a summary of the
Baum & Company opinion, including the procedures followed, the matters
considered and the assumptions made by Baum & Company in arriving at its
opinion, see "SPECIAL FACTORS -- Opinion of Financial Advisor".
FAIRNESS OF THE TRANSACTION
In concluding that a total consideration of $1,700,000 was a fair price
for the Common and Preferred Stock of the Company not owned by Ameribank, the
Special Committee and Ameribank considered a number of factors which are set
out in detail under "SPECIAL FACTORS -- Fairness of the Transaction."
The structure of the acquisition as a Merger was proposed by Ameribank and
conditioned upon Ameribank obtaining 100% ownership of the Company, thus
eliminating the separate existence of the Company. The Special Committee
negotiated the Total Consideration and the terms of the Merger Agreement with
Ameribank. At the Effective Time, the Company will merge into Ameribank and
Ameribank will be the surviving corporation. See "SPECIAL FACTORS--Structure
and Purpose of the Merger."
INTERESTS OF CERTAIN PERSONS IN THE MERGER; CONFLICTS OF INTEREST
In considering the recommendation of the Special Committee and the
approval of the Board with respect to the Merger, Shareholders should be aware
that three members of the Board have interests summarized below which present
them with conflicts of interest in connection with the Merger Agreement. The
Special Committee was aware of these conflicts and considered them among the
other matters described under "SPECIAL FACTORS -- Background of the Merger"
"Appointment of and Deliberations by the Special Committee" -- "Proceedings of
the Board and
<PAGE> 19
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Recommendation of the Special Committee -- Fairness of the Transaction." See
"SPECIAL FACTORS -- Interests of Certain Persons in the Merger; Conflicts of
Interest."
OWNERSHIP OF THE COMPANY AND UNITED AFTER THE MERGER. Ameribank and
Messrs. Cook, D. Wesley Schubert ("Mr. Schubert") and J. Michael Adcock ("Mr.
Adcock") entered into a Stock Purchase Agreement, dated November 3, 1995, which
provides that, subject to certain conditions, Ameribank will sell to each of
them 16.33% of the total number of shares of Common Stock and Preferred Stock
which Ameribank owns. Mr. Adcock transferred his rights pursuant to this Stock
Purchase Agreement to Mrs. Adcock. Messrs. Cook and Schubert and Mrs. Adcock
have entered into an Addendum to the Stock Purchase Agreement which will permit
each of them, if the Merger is consummated, to acquire 16.33% of the
outstanding shares of common stock in United. If the Merger is consummated,
the Company will be merged into Ameribank and Ameribank will be the surviving
entity. See "CERTAIN INFORMATION REGARDING AMERIBANK" and "SPECIAL FACTORS --
Background of the Merger."
DIRECTORS OF THE COMPANY AFTER THE MERGER. The Merger Agreement provides
that, after the Merger, the current directors of Ameribank will continue as the
directors of the surviving corporation, until their successors are duly elected
or appointed in accordance with applicable law.
EMPLOYMENT OF COMPANY'S EMPLOYEES. Ameribank has indicated that,
subsequent to the Merger, the current officers and employees of the Company
will remain in such capacities with the surviving corporation.
INDEMNIFICATION OF DIRECTORS AND OFFICERS. Under the Company's
Certificate of Incorporation, the Bylaws, the Merger Agreement, certain
indemnification arrangements, and under currently effective officers' and
directors' liability insurance, the Company's officers and directors may have
certain rights to indemnification with respect to any litigation relating to
the Merger. See "SPECIAL FACTORS -- Interests of Certain Persons in the
Merger; Conflicts of Interest," and "THE MERGER -- Certain Covenants of the
Company and Ameribank."
FINANCING OF THE MERGER
Ameribank will be required to pay the Total Consideration of $1,700,000
under the Merger Agreement plus the expenses in connection with the Merger.
Ameribank has represented to the Company that it has sufficient cash to enable
it to consummate the Merger which Ameribank will receive through an existing
line of credit and a possible dividend to Ameribank from American National Bank
& Trust Company, Shawnee, Oklahoma ("ANB") a subsidiary of Ameribank. The line
of credit to Ameribank is evidenced by a revolving promissory note with
Boatmen's First National Bank of Oklahoma in the maximum principal amount of
$2,700,000. As of December 31, 1996, the principal balance outstanding was
$100,000. See "SPECIAL FACTORS -- Financing of the Merger."
<PAGE> 20
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EXPENSES OF THE MERGER
Whether or not the Merger is consummated, Ameribank has agreed to pay all
reasonable expenses and disbursements incurred in connection with the
transactions contemplated by the Merger Agreement. See "SPECIAL FACTORS --
Expenses of the Merger."
CONDITIONS TO THE MERGER
The obligations of the parties to consummate the Merger are subject to the
approval of the Merger Agreement by the Shareholders of the Company, and
compliance with other covenants and conditions. See "THE MERGER -- Conditions
to the Merger, Waiver" and "-- Certain Covenants of the Company and Ameribank."
EXCHANGE OF CERTIFICATES
As soon as practicable following the Effective Time, a letter of
transmittal and instructions for use in surrendering certificates of Common
Stock and Preferred Stock will be mailed to all Shareholders except Ameribank.
Shareholders must return the completed letters of transmittal and their
certificates in accordance with the instructions in order to exchange their
certificates for the Common Consideration or Preferred Consideration to be
received by such shareholder.
At or promptly after the Effective Time, cash in an amount sufficient to
pay all Shareholders the amounts to which they will become entitled as a result
of the Merger will be deposited with Liberty Bank and Trust Company of Oklahoma
City, N.A. (the "Exchange Agent"). As soon as practicable after the Effective
Time, the Exchange Agent will commence distributing cash to each shareholder
(other than Ameribank) upon the surrender by such shareholder of certificates
for Common Stock or Preferred Stock accompanied by a duly executed letter of
transmittal. After the Merger, each outstanding certificate which prior
thereto represented issued and outstanding shares of Common Stock or Preferred
Stock shall be deemed for all purposes to represent only the right of the
holder to receive $0.776901 in cash, without interest, per share of Common
Stock, or $58.35 in cash, without interest, per share of Preferred Stock (other
than shares held by Ameribank).
HOLDERS OF COMMON STOCK AND PREFERRED STOCK SHOULD NOT FORWARD THEIR STOCK
CERTIFICATES WITH THE ENCLOSED PROXY CARD. TRANSMITTAL MATERIALS AND
INSTRUCTIONS RELATING TO STOCK CERTIFICATES WILL BE MAILED TO SHAREHOLDERS AS
SOON AS PRACTICABLE AFTER THE EFFECTIVE TIME. SEE "THE MERGER."
FEDERAL INCOME TAX CONSEQUENCES
Generally, if the Merger is consummated, each shareholder of record at the
Effective Time (other than Ameribank) will be entitled to receive cash for
their Stock and will recognize taxable gain or loss for federal income tax
purposes equal to the difference, if any, between the
<PAGE> 21
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amount of such cash received and the tax basis of the Stock exchanged. Each
shareholder should consult such shareholder's tax adviser as to the particular
consequences of the Merger to such shareholder, including the application of
state, local and foreign tax laws. See "SPECIAL FACTORS -- Certain Federal
Income Tax Consequences of the Merger."
CERTAIN LITIGATION CONCERNING THE PROPOSED MERGER
The Company is not subject to any material legal proceedings and no
litigation has been filed concerning the Merger.
BUSINESS OF THE COMPANY
The Company is a one bank holding company registered under the Bank
Holding Company Act. See "BUSINESS OF THE COMPANY." The Company is
incorporated in Oklahoma and its principal executive offices are located at
4600 S.E. 29th Street, Del City, Oklahoma 73115; telephone number (405)
677-8711.
SELECTED CONSOLIDATED FINANCIAL DATA
The table in "BUSINESS OF THE COMPANY -- Selected Consolidated Financial Data"
sets forth selected historical financial information for the Company for each
of the five years in the period ended December 31, 1996. The information
should be read in conjunction with "BUSINESS OF THE COMPANY -- Management's
Discussion and Analysis of Results of Operations and Financial Condition." The
Company's audited financial statements for the fiscal years ended December 31,
1996, December 31, 1995, December 31, 1994 and December 31, 1993 are
incorporated herein by reference to the Company's Annual Report on Form 10-K
for the years ended December 31, 1996, December 31, 1995, December 31, 1994 and
December 31, 1993. As the Company's existence will be eliminated in the Merger,
pro forma data disclosing the effect of the Merger on its balance sheet,
statement of income, earnings per share amounts, ratio of earnings to fixed
charges and book value per share is not provided.
DIVIDENDS
The Company has 145,199 shares of Preferred Stock outstanding which have
an aggregate par value of $4,355,970. No dividends have been paid on the
Preferred Stock since October 1, 1985. Cumulative unpaid dividends at
September 30, 1996, amount to $4,312,450 or approximately $29.70 per share.
All accumulated dividends on Preferred Stock will remain undeclared and unpaid
prior to and during the Merger. Until the dividends payable on the Preferred
Stock are brought current, no dividends may be paid on the Common Stock. No
dividends have been paid on the Common Stock in the last 44 quarters or 11
years.
<PAGE> 22
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SPECIAL FACTORS
BACKGROUND OF THE MERGER
In November 1994, Mr. Cook and Michael Adcock ("Mr. Adcock)", directors of
Ameribank, met with Willis J. Wheat, a director and the President of the
Company, to discuss the possible sale to Ameribank of approximately 28% of the
Common Stock and approximately 64% of the Preferred Stock. Over the next six
months, representatives of Ameribank and the Company had substantial contacts
to negotiate for the purchase by Ameribank of stock from various officers and
directors of the Company and reached an agreement in April, 1995, for Ameribank
to acquire 702,266 shares of Common Stock, or 27.7% of the outstanding shares
of Common Stock, and 92,790 shares of the Preferred Stock, or 63.9% of the
outstanding shares of Preferred Stock, from seven shareholders of the Company.
During the course of these negotiations, a subsequent merger transaction was
discussed in general, but no specific proposals were presented.
In April 1995, Ameribank filed an application with the Federal Reserve
Board seeking approval to acquire more than 5% of the outstanding shares in the
Company. On April 27, 1995, the Federal Reserve Board approved the transaction
for consummation on or after fifteen calendar days following that date.
On May 16, 1995, the acquisition was completed. At the date of closing of
this acquisition of Common Stock and Preferred Stock, the Board consisted of 3
directors: Mrs. Gladys Tucker, Willis J. Wheat and J. N. Ainsworth. At the
closing on May 16, 1995, Mrs. Tucker resigned as a director and Ameribank's
designee, Mr. Cook, was elected as a director of the Company to fill such
vacancy by the remaining members of the Board. Pursuant to an agreement with
Ameribank, Messrs. Wheat and Ainsworth resigned as directors and officers of
the Company effective June 15, 1995. Mr. Schubert and Mr. Adcock, designees of
Ameribank, were elected as directors of the Company to fill such vacancies by
the remaining director of the Company. After the election of Messrs. Schubert
and Adcock to the Board, Ameribank effectively controlled the Company. Messrs.
Cook, Schubert and Adcock are officers and directors of both the Company and
Ameribank and have been involved in every decision by Ameribank to acquire
additional shares.
In July, 1995, Ameribank decided to seek to acquire additional shares of
Preferred Stock and on July 20, 1995, sent a letter to all holders of Preferred
Stock offering to purchase all outstanding shares of Preferred Stock for $18.00
per share. As a result of that offer, Ameribank acquired an additional 8,256
shares of the Preferred Stock. During the balance of 1995, Ameribank purchased
4,995 additional shares of the Preferred Stock.
On September 29th and October 2nd of 1995, Ameribank entered into two
separate Stock Purchase Agreements for 84,000 and 66,000 shares of Common
Stock, respectively for $0.50 per share.
On November 3, 1995, Ameribank commenced a tender offer to purchase up to
1,478,036 shares of Common Stock for a price of $0.50 per share. The number of
shares sought in the tender offer was subsequently decreased and, when the
offer terminated on December 29, 1995, Ameribank had acquired 588,146
additional shares of Common Stock. Ameribank has purchased additional shares
of Common Stock and Preferred Stock in private transactions and presently owns
a total of 1,559,598 shares of Common Stock and 129,016 shares of Preferred
Stock representing approximately 62% of the outstanding shares of Common Stock
and 89% of the outstanding shares
<PAGE> 23
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of Preferred Stock, respectively. See "BENEFICIAL OWNERSHIP OF SHARES --
Certain Transactions in Common Stock and Preferred Stock."
Ameribank and Messrs. Cook, Schubert and Adcock entered into a Stock
Purchase Agreement, dated November 3, 1995, which provided that Ameribank will
sell to each of Messrs. Cook, Schubert and Adcock 16.33% of the total number of
shares of Common Stock and Preferred Stock which Ameribank owns or acquires in
future purchases; whereby the aggregate stock ownership in Ameribank by Messrs.
Cook, Schubert and Adcock after the Merger will be 49% (16.33% each). The
purpose of the Stock Purchase Agreement is to provide an opportunity for
additional compensation to Messrs. Cook, Schubert and Adcock for their services
in enhancing the potential value of Ameribank's investment in the Company. The
terms provided that the purchase price for such Stock would be the price at
which Ameribank acquired the shares plus interest, accrued from the date of
Ameribank's acquisition of such Stock to the closing of the purchase
contemplated by the agreement, at a rate equal to the base rate of interest of
Chase Manhattan Bank, N.A. from time to time. The consummation of the
transactions is subject to (1) approval from the Federal Reserve System; (2)
the entering into by the parties of a Shareholders' Agreement restricting the
future transfer of the Stock by Messrs. Adcock, Schubert and Cook; and (3) the
entering into by the parties of a Voting Trust Agreement appointing Ameribank
as Trustee to vote the shares of Common Stock. On November 27, 1996, Mr.
Adcock entered into an agreement with his wife, Dona B. Adcock, transferring
to her his rights to purchase shares of the Company under the Stock Purchase
Agreement. Mrs. Adcock is the daughter of Mr. Bodard, the sole shareholder of
Ameribank. Messrs. Cook and Schubert and Mrs. Adcock have entered into an
Addendum to the Stock Purchase Agreement with Ameribank dated January 27, 1997,
whereby Ameribank agrees that if the Merger is consummated, Ameribank will sell
to each of Messrs. Cook and Schubert and Mrs. Adcock 16.33% of the total number
of shares of outstanding common stock of United at a price per share equal to
the total consideration, plus costs and interest paid by Ameribank for the
Stock, divided by the total number of outstanding shares of common stock of
United, and on the same terms and subject to the same conditions as previously
agreed.
In March, 1996, Mr. Cook invited David A. Nichols ("Mr. Nichols"), to join
the Board as an independent director. Mr. Cook has known Mr. Nichols since
1984 and had the opportunity to work with Mr. Nichols on loan transactions and
participation agreements during the course of their acquaintance.
At the annual meeting of shareholders held on April 25, 1996, Mr. Nichols
was elected as a director of the Company and Mr. Adcock was re-elected as a
director of the Company to serve in addition to Mr. Cook and Mr. Schubert.
Mr. Rappaport has been a member of the Board of Directors of United since
January 30, 1989. In May, 1996, Messrs. Cook and Adcock asked Mr. Rappaport if
he would serve as a director of the Company. On May 25, 1996, Mr. Rappaport
was elected to the Board by the unanimous vote of the directors.
<PAGE> 24
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APPOINTMENT OF AND DELIBERATIONS BY THE SPECIAL COMMITTEE
As previously stated, Ameribank owns approximately 62% of the Common Stock
and approximately 89% of the Preferred Stock. By virtue of its stock ownership
of the Company, Ameribank controls the Company. In addition, three members of
the Board are officers, directors and management employees of Ameribank. Two
members of the Board, Mr. Rappaport and Mr. Nichols, are not affiliates of
Ameribank, do not have a financial interest in Ameribank and have not served as
an officer, director, or employee of Ameribank.
During June, 1996, Ameribank presented a written offer to the Company to
merge the Company into Ameribank, and as consideration therefor, Ameribank
offered to pay $1,300,000 in cash for all the shares of Common Stock and
Preferred Stock of the Company not owned by Ameribank, subject to the execution
of a binding merger agreement by the Company and Ameribank, receipt of
approval, if required, from applicable regulatory agencies and approval of the
merger by the Shareholders. Ameribank provided that its offer would expire on
August 1, 1996.
Since three members of the Board were affiliated with Ameribank and had a
financial interest in the proposal, the Board established a Special Committee
of the Board, consisting of Mr. Rappaport and Mr. Nichols, who have no
financial interest in Ameribank and have not been officers, directors, or
employees of Ameribank. The Special Committee was authorized to evaluate any
offer by Ameribank, to negotiate for the Company concerning the terms and
conditions of any proposal as to a merger with Ameribank and to make a
recommendation to the Board regarding such merger. The Board further
authorized the Special Committee to engage a financial advisor to provide the
Special Committee with financial and other business advice, legal counsel to
advise the Special Committee concerning relevant legal issues in discharging
its duties and responsibilities and such other advisers as the Special
Committee deems necessary to carry out its duties. The Shareholders were
informed of the Ameribank proposal and appointment of a Special Committee by
letter dated June 17, 1996, from Mr. Cook, the Chairman of the Board.
On June 19, 1996, the Special Committee met and interviewed two (2) law
firms in connection with the possible representation of the Special Committee.
One of the law firms interviewed was Conner & Winters. During the interview,
Irwin H. Steinhorn, a member and director of Conner & Winters advised the
Special Committee that the firm has represented numerous publicly held
companies and has represented publicly held companies in connection with
mergers and other similar transactions. Mr. Steinhorn further advised the
Special Committee that (i) approximately two (2) years ago and while he was a
member of another law firm, he received a call from Mr. Adcock, counsel for,
and a director of, Ameribank regarding certain filings with the Commission by
Ameribank in connection with Ameribank's initial purchase of shares of Common
Stock and Preferred Stock and that (ii) other attorneys in Mr. Steinhorn's
previous law firm may, at or about the same time, have also advised Ameribank
in connection with the purchase of such Stock. Mr. Steinhorn further informed
the Special Committee that, other than this previous representation neither he
nor Conner & Winters have performed any legal services for Ameribank or the
Company, and that he did not believe that Conner & Winters, if selected to
represent the Special Committee, would have a conflict in connection with such
representation. Representatives of Ameribank advised the Special Committee
that certain attorneys in Mr. Steinhorn's previous law firm (other than Mr.
Steinhorn) had represented Ameribank in its initial purchase of Common Stock
and Preferred Stock and that such representation had ceased prior to the end of
May, 1995.
<PAGE> 25
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After interviewing the two (2) law firms, the Special Committee determined
that Conner & Winters did not have a conflict in representing the Special
Committee and Conner & Winters had expertise in representing publicly held
companies involved in mergers and similar transactions. As a result, the
Special Committee retained Conner & Winters as the Special Committee Counsel.
On July 15, 1996, the Special Committee met and interviewed two investment
banking firms for the purpose of retaining one to act as the financial advisor
to the Special Committee in connection with Ameribank's offer and to advise the
Special Committee as to a fair price to the non-Ameribank Shareholders from a
financial point of view.
On July 23, 1996, the Special Committee met for the purposes of selecting
an investment banking firm. At such meeting, the Special Committee unanimously
retained Baum & Company, who had advised the Special Committee that it has had
no prior involvement with Ameribank or the Company, as its financial advisor
based on Baum & Company's experience with providing financial and business
advice to publicly held bank holding companies and the type of transaction
being proposed by Ameribank. It was agreed that the Company would pay Baum &
Company for its services to the Special Committee a fee of Twenty-Five Thousand
Dollars ($25,000), plus 0.1% of the total cash merger price payable to
non-Ameribank Shareholders if a merger with Ameribank is consummated, all
reasonable travel and out-of-pocket expenses incurred by Baum & Company in
connection with, or arising out of, its services to the Special Committee and
up to Two Thousand Five Hundred Dollars ($2,500) for Baum & Company's outside
legal expenses, if any, in connection with questions from the Commission or
comments regarding Baum & Company's fairness opinion and analysis. It was
further agreed that the Company would indemnify Baum & Company for any losses
or claims made against Baum & Company as a result of, among other things, its
services performed on behalf of the Special Committee, except if it is
judicially determined by a court of competent jurisdiction in a final judgment
that such claim or loss resulted from Baum & Company's bad faith, reckless
disregard, gross negligence or willful misconduct. Baum & Company was not
provided any specific instructions from the Special Committee in performing its
review, nor did the Special Committee impose any limitations on the scope of
Baum & Company's investigation. On August 5, 1996, the Special Committee sent
a letter to the Shareholders notifying them of the engagement of a financial
advisor and legal counsel.
At the meeting of the Special Committee held on July 23, 1996, based on
the recommendation of Special Committee Counsel, the Special Committee
determined that it needed a current MAI appraisal on the Bank Tower. The
Special Committee authorized Mr. Rappaport, Chairman of the Special Committee,
to interview and recommend to the Special Committee a qualified appraiser.
The company recommended by Mr. Rappaport and selected by the Special
Committee was R.W. Finley Co, Inc. ("Finley"). Finley is a real estate
consultant and appraisal company which utilizes appraisers who are MAI
designated by the Appraisal Institute and who are certified by the State of
Oklahoma. The selection of Finley to perform the Bank Tower appraisal was made
by the Special Committee because of Finley's experience, including a previous
appraisal of the Bank Tower in 1989 at the direction of United and reputation.
The Special Committee believed
<PAGE> 26
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that Finley's familiarity with the Bank Tower would expedite obtaining an
appraisal. After the 1989 appraisal and until the engagement for the August
31, 1996 appraisal, Finley performed no other work for UOB. No material
relationship currently exists or existed during the past two years, or is
mutually understood to be contemplated between Finley, its affiliates and UOB
or its affiliates.The Special Committee adjourned its July 23, 1996, meeting to
meet with representatives of Ameribank. Also in attendance at the meeting was
legal counsel for the Special Committee. Upon the request of the Special
Committee, Ameribank agreed to extend the expiration date of its offer from
August 1, 1996 to November 1, 1996. Members of the Special Committee requested
Ameribank to advise the Special Committee as to the basis used by Ameribank in
arriving at its offer of $1,300,000 for all shares of Common and Preferred
Stock of the Company not owned by Ameribank. Representatives of Ameribank
advised the Special Committee that the value of the outstanding shares of the
Company held by non-Ameribank Shareholders was based, in part, on an appraisal
of United prepared by GRA, Petty & Co., in 1996. The 1996 appraisal by GRA,
Petty & Co., updated an appraisal previously prepared by GRA, Petty & Co. in
1995, prior to the July 1995 offer by Ameribank to purchase additional shares
of Preferred Stock. GRA, Petty & Co. is a real estate consultant and appraisal
company which utilizes appraisers who are MAI designated by the Appraisal
Institute and who are certified by the state of Oklahoma. The selection of
GRA, Petty & Co. to perform the appraisal of United was made by Ameribank
because of GRA, Petty & Co. experience and reputation, and that GRA, Petty &
Co. had performed an appraisal of United in 1995 at the direction of Ameribank.
Ameribank believed that GRA, Petty & Co.'s familiarity with United would be
beneficial in obtaining an appraisal. From the time of the 1995 appraisal to
the time of the engagement for the 1996 appraisal, GRA, Petty & Co. performed
no other work for Ameribank and furthermore, there is no material relationship
which currently exists or which existed during the past two years or which is
mutually understood to be contemplated between GRA, Petty & Co., its affiliates
and Ameribank or its affiliates. The Special Committee requested a copy of the
1996 report by GRA, Petty & Co. and an analysis as to how Ameribank arrived at
the $1,300,000 offer.
On August 16, 1996, the Special Committee met with representatives of the
Special Committee Counsel, Baum & Company, and the Company. The Company's
representative was instructed to assist Baum & Company in its review of the
Company's and United's records and to provide to Baum & Company copies of all
documents as requested by Baum & Company. The representative of the Company
also discussed with the Special Committee, and representatives of Baum &
Company and the Special Committee Counsel, the pending safety and soundness
examination by the bank examiners and the availability of reports on prior
examinations for review by Baum & Company. During the meeting, the
representative of Baum & Company requested copies of numerous documents from
the Company including, but not limited to, copies of Schedule 13D filings with
the Commission by Ameribank involving Ameribank's purchases of Common and
Preferred Stock of the Company.
At such meeting, the Special Committee and Baum & Company were advised by
the Special Committee Counsel that the OGCA was originally based on the
Delaware General Corporation Law ("Delaware Law"), and, as a result, should be
interpreted in accordance with the Delaware decisions. Under the Delaware Law,
the Delaware decisions have concluded that "fair value" is to be used to
determine the value of minority stock, and that to determine "fair value" a
<PAGE> 27
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company must be viewed as a going concern and includes the use of all generally
accepted techniques of valuation used in the financial community and should
take into account all relevant factors, except speculative elements of value,
that may arise from the accomplishment or expectation of the merger. Special
Committee Counsel discussed with the Special Committee and Baum & Company the
various factors the Delaware decisions have considered in determining fair
value of minority stock. Special Committee Counsel further advised the Special
Committee and Baum & Company that present court decisions in both Delaware and
Oklahoma have held that the application of a discount to minority shares is
contrary to the requirement that the company be viewed as a going concern and
application of a minority discount is not appropriate.
At the August 16, 1996, meeting, the Special Committee requested that
Special Committee Counsel request from Ameribank a copy of the appraisal by
GRA, Petty & Co. and an analysis as to the basis used by Ameribank to arrive at
the $1,300,000 offer for the outstanding non-Ameribank shares of the Company.
The Special Committee further discussed with its financial advisor and Special
Committee Counsel that since Ameribank presently owns more than a majority of
all outstanding classes of Stock of the Company and controls the Company, it
would be difficult, if not impossible, to find another potential buyer for the
minority shares of the Company, and that if the price to be paid by Ameribank
for the minority shares of the Company is fair and consistent with legal
requirements, Ameribank would be the appropriate party to buy the outstanding
minority shares of the Company. The Special Committee requested Special
Committee Counsel to request from Ameribank as to whether Ameribank has
received any offers to acquire the Company, and if so, the terms of such offer.
The Special Committee reviewed the records of the Company available to the
Special Committee and Baum & Company as to any recent transactions involving
the Company's Common Stock and copies of Schedule 13D filings as to the
purchase price paid for the Company Common Stock and Preferred Stock in recent
transactions. It was noted that there were very few trades in the Company
Common Stock over the last twelve months. Based on Schedule 13D filings with
the Commission during the past twelve months, Baum & Company noted that during
such period the maximum price paid for shares of Common Stock of the Company
was $0.60 per share.
The Special Committee noted that there is no market for the Company's
outstanding Preferred Stock, and, based on Schedule 13D filings with the
Commission provided to the Special Committee and George K. Baum, the only
transactions in Preferred Stock since July, 1995, were by Ameribank at $18.00
per share.
By letter dated September 5, 1996, counsel for Ameribank advised that
Ameribank used the following methodology to arrive at the $1,300,000 offer:
(i) total market value of the Company was arrived at by three methods, all of
which counsel for Ameribank advised resulted in similar values: (a) using the
GRA, Petty & Co. appraisal of the Company of approximately $10,382,000; (b)
determining market value by multiplying the five year average earnings of the
Company (assuming that the Company earnings for 1996 reaches $725,000) of
$756,000 by 13.5 (which counsel for Ameribank advised was based on Sword &
Associates Banking Company Report as being the multiple that banks with the
Company's characteristics were selling for in 1995), resulting in a market
value for the Company of approximately $10,260,000; and (c) book value method
determined by stockholders' equity of the Company at March 31, 1996 of
$7,987,000, less
<PAGE> 28
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net book value of land and buildings of $3,500,053, resulting in a total of
$4,477,947 times 1.5 (multiple for cash sale) plus value of land and buildings
of $3,500, 053, totaling $10,216,973; (ii) the outstanding Preferred Stock of
the Company has a liquidation value of $58.35 per share at March 31, 1996, for
a total liquidation value of $8,472,472. After applying a 25% discount, the
outstanding Preferred Stock not owned by Ameribank would be $43.75 per share,
totaling $700,265 for all outstanding shares of Preferred Stock of the Company
not owned by Ameribank; and (iii) the value of the Common Stock of the Company
was determined by subtracting from the market value of the Company based on the
appraisal performed by GRA, Petty & Co. ($10,382,000) the liquidation value of
the outstanding Preferred Stock of the Company ($8,472,420) for a market value
of the Common Stock of $1,909,580, or $0.754 per share, and 75% of the market
value being $0.566 per share for a total of $550,254 for outstanding shares of
the Common Stock not owned by Ameribank. Counsel for Ameribank advised that
although the total was $1,250,519, Ameribank rounded such number to $1,300,000.
In said letter, counsel for Ameribank further advised that Ameribank had not
received any offers to purchase the Company and would provide the Special
Committee with a copy of the appraisal performed by GRA, Petty & Co. at such
time as the Special Committee informed Ameribank that it had developed a
reasonable basis for valuation of the minority stock of the Company.
On October 21, 1996, the Special Committee held a meeting to discuss the
valuation by Baum & Company of the minority Common and Preferred Stock of the
Company and the appraisal of the Bank Tower by Finley, which had been
previously delivered to members of the Special Committee, Baum & Company and
the Special Committee Counsel. The R.W. Finley Co. appraisal estimated the
value of the Bank Tower to be $2,950,000 as of August 31, 1996, excluding trade
fixtures. Finley prepared a complete MAI appraisal in accordance with the
Uniform Standards of Professional Practice ("USAP") in a summary report
determining the fair market value of the Bank Tower. The income approach and
the sales comparison approach were used by Finley to arrive at its appraised
value figure of $2,950,000 for the Bank Tower, excluding trade fixtures, and
taking into account the quality and quantity of data available for each
approach.
A representative of Baum & Company then reviewed with the Special
Committee its proposed fairness analysis of the Company. The Special Committee
was advised that a price of $58.35 per share for the outstanding Preferred
Stock of the Company and $0.754 per share for the outstanding Common Stock of
the Company not owned by Ameribank, being the valuation placed on the Company's
Preferred and Common Stock by Ameribank, without a minority discount, is fair
from a financial point of view, and, as a result, a total value of $1,679,131
for all of the Company's outstanding Common and Preferred Stock held by
non-Ameribank Shareholders was fair from a financial point of view.
Baum & Company used the following two methods to value the Common Stock:
(i) (a) liquidation based on book value and (b) liquidation based on the entity
market value, and (ii) discounted cash flow at various discount rates. The
liquidation method employed the June 30, 1996 balance sheet. The first
liquidation method subtracted the par value of the Preferred Stock and the
cumulated unpaid preferred dividends from stockholders' equity resulting in the
common
<PAGE> 29
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stockholders having a negative value. The second liquidation method used the
stockholders' equity minus the book value of the bank building. The
stockholders' equity minus the book value was multiplied by 1.5 times to 1.75
times and the appraised value of the bank building was added back to the
multiplied stockholders' equity. The Preferred Stock par value and cumulative
unpaid dividends was subtracted from the multiplied stockholders' equity, which
included the Bank Tower and the product was divided by the number of common
shares outstanding. Using the liquidation value based on the entity market
value, as well as the discounted cash flow method following certain
assumptions, Baum & Company determined that a value of $0.754 per share of the
outstanding Common Stock is fair from a financial point of view. Baum &
Company did not consider the fairness from a financial point of view of a
minority discount since the Special Committee Counsel had advised the Special
Committee and Baum & Company that Delaware and Oklahoma courts have held that
minority discounts were not applicable to the valuation of minority stock. See
"SPECIAL FACTORS --Opinion of the Financial Advisor."
Baum & Company delivered to the Special Committee its written fairness
opinion, dated October 25, 1996. A copy of the Baum & Company's fairness
opinion is attached hereto as ANNEX C and should be read in its entirety. See
"SPECIAL FACTORS --Fairness of the Transaction."
On October 28, 1996, the Special Committee met with representatives of
Ameribank. Also present were legal counsel for Ameribank and the Special
Committee. The Special Committee advised Ameribank that it could not accept an
offer of $1,300,000 for the outstanding shares of Common and Preferred Stock of
the Company held by non-Ameribank Shareholders, as in the opinion of the
Special Committee such was not a fair price due to such offer containing a 25%
minority discount. The Special Committee advised Ameribank that Special
Committee Counsel had advised the Special Committee that, based on Delaware and
Oklahoma court decisions, it could not use a minority discount to determine the
value of the outstanding Common and Preferred Stock held by non-Ameribank
Shareholders. The Special Committee then discussed with Ameribank the opinion
of Baum & Company that a price of $0.754 per share for the outstanding Common
Stock and $58.35 per share for the outstanding Preferred Stock, without a
minority discount, for a total cash consideration of approximately $1,700,000
to non-Ameribank Shareholders was fair from a financial point of view. The
Special Committee reviewed with the representatives of Ameribank the fairness
letter issued by Baum & Company. After further negotiations, Ameribank agreed
to pay a total consideration of $1,700,000 for the Common and Preferred Stock
of the Company held by non-Ameribank Shareholders, as follows: $58.35 per
share for the outstanding Preferred Stock and the balance for the outstanding
Common Stock.
The Special Committee then met separately. The Special Committee
concluded that the revised offer by Ameribank totaling $1,700,000 for all
outstanding shares of the Company equity securities held by non-Ameribank
Shareholders, consisting of $58.35 per share for the Preferred Stock held by
non-Ameribank Shareholders and the balance (being approximately $0.776902 per
share) for the Common Stock held by non-Ameribank Shareholders was a fair
price. The Special Committee considered that (i) Ameribank already owns more
than a majority of the outstanding Common and Preferred Stock of the Company
and controls the Company, and that it would be difficult, if not impossible, to
find another party to buy the minority interest, (ii) there is no market
<PAGE> 30
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for the Preferred Stock and the highest price paid for the Preferred Stock
since July, 1995, based on information provided to the Special Committee and
Baum & Company by the Company, was $18.00 per share paid by Ameribank and (iii)
that there is little or no market for the Common Stock of the Company and
during the last twelve months, based on Schedule 13D filings with the
Commission, copies of which were provided to the Special Committee and Baum &
Company by the Company, the maximum price paid for shares of Common Stock was
$0.60 per share. In determining that such was a fair price, the Special
Committee considered and gave the greatest weight to the fairness opinion of
Baum & Company that any aggregate consideration of $1,700,000, based on $58.35
per share for the outstanding Preferred Stock held by non-Ameribank
Shareholders and $0.754 per share for the outstanding Common Stock held by
non-Ameribank Shareholders, was fair from a financial point of view. The
Special Committee then unanimously approved the merger of the Company into
Ameribank for a total consideration of $1,700,000 for all of the outstanding
Preferred and Common Stock held by non-Ameribank Stockholders, with the
unanimous recommendation that such merger by approved by the Board.
After the meeting of the Special Committee on October 28, 1996, the Board
met, together with Special Committee Counsel and counsel for Ameribank. At
such meeting the Special Committee reported that it had unanimously approved,
and recommended approval by the Board of Ameribank's offer to merge the Company
into Ameribank for a total cash payment of $1,700,000 to be paid for all Common
and Preferred Stock held by non-Ameribank Shareholders, with $58.35 per share
to be paid to each non-Ameribank Preferred Shareholder (totaling $944,278) and
the balance ($755,722) to be paid for all shares of the Common Stock held by
non-Ameribank Shareholders at $0.776901 per share. The Board, based on the
recommendations of the Special Committee and the written fairness opinion of
Baum & Company, approved the merger of the Company into Ameribank for a total
consideration of $1,700,000 for all of the outstanding Preferred and Common
Stock of the Company held by non-Ameribank Shareholders, with $58.35 per share
to be paid for the outstanding Preferred Stock and the balance to be paid for
the outstanding Common Stock. The members of the Board affiliated with
Ameribank abstained from voting.
Mr. Cook wrote to the Shareholders on November 4, 1996, notifying them of
the revised proposal and stating that completion of the proposed merger
transaction was subject to preparation of a mutually satisfactory merger
agreement with Ameribank, certain filings and approvals with regulatory
agencies and approval by vote of holders of a majority of the shares of Common
Stock and Preferred Stock, each voting as a class at a Special Shareholder's
meeting.
During the month of November, 1996, counsel for Ameribank and the Special
Committee Counsel negotiated the final terms of the Merger Agreement between
Ameribank and the Company. This negotiation dealt with drafting miscellaneous
provisions and overall language of the Merger Agreement in a format that was
acceptable to both Ameribank and the Company. On December 3, 1996, the Special
Committee met and reviewed the final Merger Agreement. for the Special
Committee Counsel advised the Special Committee that most of the changes to the
Merger Agreement requested by the Special Committee Counsel were accepted by
Ameribank. The Special Committee then reviewed, in detail, the Merger
Agreement and noted that pursuant to such agreement Ameribank would pay to the
Shareholders of the Company (other than Ameribank) an aggregate sum of
$1,700,000 with $58.35 per share being paid to non-Ameribank holders of the
<PAGE> 31
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outstanding the Preferred Stock and $0.776901 per share (rounded to the nearest
$0.01) to be paid to non-Ameribank holders of the outstanding Common Stock.
After reviewing the Merger Agreement, the Special Committee approved the Merger
Agreement and recommended approval of the Merger Agreement by the Board.
Following the meeting of the Special Committee, the Board met to consider
the Special Committee's recommendation and after discussion, voted to approve
the Merger Agreement as recommended by the Special Committee and to authorize
the execution of the Merger Agreement on behalf of the Company. The members of
the Board affiliated with Ameribank abstained from voting.
Mr. Cook again wrote to the Shareholders on December 5, 1996, advising the
Shareholders of the execution of the Merger Agreement and stating that
completion of the Merger is subject to preparation of all necessary filings and
approvals with regulatory agencies and the approval by vote of holders of a
majority of the shares of the Common Stock and Preferred Stock, each voting as
a class at a Special Shareholder's meeting.
On December 12, 1996, the Company filed a Current Report on Form 8-K with
the Commission reporting the Merger Agreement between Ameribank and the
Company.
During the first part of January, 1997, counsel for Ameribank provided the
Special Committee Counsel with copies of the Form 4s, as previously filed by
Ameribank with the Commission, showing that from January 1, 1996, through June
30, 1996, Ameribank had purchased shares of Preferred and Common Stock at
prices ranging from $18.00 to $49.50 per share for Preferred Stock and not more
than $0.50 per share for Common Stock. The Special Committee Counsel forwarded
copies of these Forms 4 to the members of the Special Committee and Baum &
Company.
As a result of this additional information, the Special Committee held a
telephonic meeting on January 14, 1997, with a representative of Baum &
Company. The Special Committee Counsel also participated in such meeting.
During the meeting, members of the Special Committee reviewed the factors
considered by the Special Committee in approving and recommending to the Board
the Merger of the Company into Ameribank and determining that the $1,700,000
offer by Ameribank to the non-Ameribank Shareholders of the Company in
connection with such Merger, with $58.35 for each share of Preferred Stock and
$0.776901 (rounded to the nearest $.01) for each share of Common Stock was
fair. One of the considerations was the belief by the Special Committee and
Baum & Company that the highest price Ameribank paid for the Preferred Stock
since July, 1995 was $18.00 per share. Based on the information that Ameribank
had paid from $18.00 to $49.50 per share for Preferred Stock and no more than
$0.50 per share for the Common Stock, as noted in the Form 4s, members of the
Special Committee asked Baum & Company's representative if the fairness opinion
of Baum & Company, dated October 25, 1996, would change and whether the
$1,700,000 offer by Ameribank remained fair from a financial point of view.
Baum & Company's representative advised the Special Committee that, since the
highest amount paid for the Preferred Stock since January 1, 1996, was $49.50
per share, and that the current offer of $58.35 per share represented
approximately a 16% premium over the highest price paid by
<PAGE> 32
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Ameribank for the Preferred Stock and that the $0.754 being offered by
Ameribank for the Common Stock represented approximately a 51% premium over the
$0.50 previously offered by Ameribank for the Common Stock, Baum & Company's
fairness opinion would not change and the $1,700,000 purchase price to be paid
by Ameribank to non-Ameribank Shareholders in connection with the Merger is
still fair from a financial point of view.
During the meeting, the members of the Special Committee asked the Special
Committee Counsel to request from Ameribank or Ameribank's counsel a letter
certifying that during the last twelve months Ameribank has not paid more than
$49.50 per share for Preferred Stock nor more than $0.50 per share for Common
Stock. As a result of the additional information, the Special Committee also
requested Baum & Company to issue a supplemental fairness opinion reaffirming
its fairness opinion, dated October 25, 1996.
The Special Committee then reaffirmed its approval and recommendation to
the Board of the Merger of the Company with Ameribank for $1,700,000 to be paid
to non-Ameribank Shareholders, subject to (i) Ameribank or its counsel
certifying that during the past twelve months the maximum prices paid by
Ameribank for Preferred Stock has not exceeded $49.50 per share and Common
Stock had not exceeded $.50 per share, and (ii) receipt of the supplemental
fairness opinion from Baum & Company that the aggregate price of $1,700,000 to
be paid to non-Ameribank Shareholders is fair from a financial point of view,
as set forth in Baum & Company's letter of October 25, 1996.
As a result of the request of the Special Committee Counsel, counsel for
Ameribank wrote to the Special Committee Counsel advising, among other things,
that (i) Ameribank has not paid more than $0.50 per share for shares of Common
Stock, and (ii) Ameribank made an offer in July, 1995, to purchase shares of
Preferred Stock for $18.00 per share, and that subsequently, Ameribank had
acquired shares of Preferred Stock through private purchases at prices ranging
from $18.00 to $49.50 per share. In addition, counsel for Ameribank advised in
such letter that Ameribank entered into separate stock purchase agreements with
several persons, in which Ameribank agreed that if Ameribank, among other
transactions, entered into a merger agreement with the Company within one (1)
year of the date of the stock purchase agreements and paid a higher price for
the outstanding shares of Common and Preferred Stock than that provided in the
stock purchase agreements, Ameribank would pay the sellers the difference.
Pursuant to the request of the Special Committee Counsel, Ameribank
provided to the Special Committee and Baum & Company copies of the
above-referenced stock purchase agreements. Under such stock purchase
agreements, which are dated May 31, 1996 and June 6, 1996, Ameribank agreed to
purchase 5,799 shares of Common Stock of the Company for $0.50 per share from
two sellers and 17,795 shares of Preferred Stock at $49.50 per share from two
sellers, with the agreement that in the event Ameribank paid a higher price
than the price paid to such sellers in a subsequent tender offer or merger
transaction occurring within one (1) year from the date of the respective stock
purchase agreement, Ameribank would pay the sellers the difference in cash.
<PAGE> 33
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By letter dated January 23, 1997, a copy of which is attached as ANNEX D,
Baum & Company issued its supplemental fairness opinion, which stated in part
that (i) it issued its fairness opinion letter dated October 25, 1996, based on
information that had been requested and supplied to it by the Company; (ii)
such information supplied to it indicated, among other things, that the highest
price Ameribank had paid for Preferred Stock of the Company was $18.00 per
share; (iii) that on January 17, 1997, it had been informed that Ameribank had
purchased Preferred Stock at prices ranging from $18.00 to $49.50, and (iv)
that certain purchases by Ameribank were made under agreements providing that,
for one (1) year from the date of the purchases, Ameribank would pay the
sellers the same price, if higher, that Ameribank paid for the Common and
Preferred Stock. The supplemental fairness opinion issued by Baum & Company
states that, even with the additional information regarding the Preferred Stock
purchased by Ameribank, Baum & Company finds the Total Consideration to be paid
to holders of Common and Preferred Stock (other than Ameribank) in connection
with the Merger and the Common Consideration and the Preferred Consideration to
be fair from a financial point of view, as set forth in its letter dated
October 25, 1996.
On January 27, 1997, the Special Committee held a telephonic meeting in
which the Special Committee Counsel participated. The Special Committee
Counsel reviewed the letter from Ameribank's counsel, dated January 16, 1997,
the stock purchase agreements discussed above, and the supplemental fairness
opinion, dated January 23, 1997, issued by Baum & Company. Based on the
supplemental fairness opinion issued by Baum & Company and the other
considerations previously considered by the Special Committee and discussed
above, the Special Committee reaffirmed its approval and recommendation to the
Board of the Merger for an aggregate price of $1,700,000.
PROCEEDINGS OF THE BOARD AND RECOMMENDATION OF THE SPECIAL COMMITTEE
THE COMPANY. At a meeting held on October 28, 1996, pursuant to the
recommendations of the Special Committee, the Board determined that the terms
of the Merger were fair to and in the best interests of the Shareholders (other
than Ameribank) and approved the Merger Agreement. The Merger Agreement was
subsequently executed and delivered on December 3, 1996. See "SPECIAL FACTORS
- -- Appointment and Deliberations by the Special Committee -- Fairness of the
Transaction."
THE COMPANY'S BOARD OF DIRECTORS. The Board is comprised of five
directors, three of whom are affiliated with Ameribank. Mr. Cook is a director
of the Company as well as its Chairman. He is also a director and the
Secretary of Ameribank and has served as the President and Chief Executive
Officer of ANB, since December 16, 1992. Mr. Adcock is a director and the
Secretary of the Company. He is also a director of Ameribank and ANB. Mr.
Adcock is the son-in law of Mr. Bodard, the sole shareholder of Ameribank. Mr.
Schubert is a director and the President of the Company as well as a Vice
President, director and the Treasurer of Ameribank. As officers and directors
of Ameribank, Messrs. Cook, Schubert and Adcock have been involved in every
decision by Ameribank to acquire additional shares of the Company. Mr. Nichols
and Mr. Rappaport are also directors of the Company. Mr. Nichols was elected
to the Board by the shareholders at the annual meeting held on April 25, 1996.
Mr. Rappaport was elected to the Board
<PAGE> 34
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by the remaining four directors on May 25,1996. Neither of them have any
financial or personal interest in Ameribank and they are not officers,
directors, employees or stockholders of Ameribank.
FAIRNESS OF THE TRANSACTION
In concluding that a total consideration of $1,700,000 was a fair price
for the outstanding Common and Preferred Stock of the Company not owned by
Ameribank, consisting of $58.35 per share for such outstanding Preferred Stock
(totaling $944,278) and $0.766901 (rounded to the nearest $0.01) per share for
the such outstanding Common Stock, the Special Committee considered the
following factors:
1. Ameribank owns more than a majority of all
outstanding classes of Stock of the Company and controls the
Company, and, as a result, it would be difficult, if not
impossible, to find another potential buyer for the minority
value of the Company.
2. There is a very limited market, if any, for the
Common Stock.
3. There is no market for the Preferred Stock.
4. Based on filings with the Commission, during the
last twelve months the maximum price paid for shares of the
Common Stock was $0.60 per share. Based on information
supplied to the Special Committee by Ameribank, Ameribank
bought 5,799 shares of Common Stock in June, 1996, for $0.50
per share, with the agreement that if a transaction is
consummated for the Common Stock by Ameribank within twelve
(12) months at a price higher than $0.50 per share, Ameribank
would pay such sellers the difference.
5. Based on information supplied to the Special
Committee by Ameribank, as previously filed with the
Commission, since January 1, 1996, the prices paid by
Ameribank for shares of Preferred Stock have ranged from
$18.00 to $49.50 per share, with agreements between certain
sellers and Ameribank in connection with shares of Preferred
Stock providing that if within one (1) year from the date of
such stock purchase agreements Ameribank pays more for the
Preferred Stock in a tender offer or merger than that
received by such sellers, Ameribank will pay to such sellers
the difference.
6. Ameribank has advised the Special Committee that
it has not received any offers for the Company.
7. The determinations and opinion of Baum &
Company.
Ameribank considers the Merger fair to the Shareholders other than
Ameribank based on the determinations made by the Special Committee as set out
above. However, Ameribank also considers the Merger fair to the Shareholders
other than Ameribank as the Total Consideration to be paid to the Shareholders
is $400,000 greater than the $1,300,000 offer made by Ameribank to
<PAGE> 35
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the Board on June 14, 1996. Additionally, the Preferred Consideration to be
paid by Ameribank is a premium of approximately 16% over the highest price
previously paid by Ameribank for the Preferred Stock and the Common
Consideration to be paid by Ameribank is a premium of approximately 50% over
the highest price previously paid by Ameribank for the Common Stock.
Furthermore, Ameribank's offer of $1,700,000 is greater than the sum of
$1,697,131 which Baum & Company considered fair to Shareholders other than
Ameribank.
OPINION OF FINANCIAL ADVISOR
In concluding that Ameribank's offer to pay an aggregate of $1,700,000 to
non-Ameribank Shareholders of the Company, with $58.35 per share for the
outstanding Preferred Stock (totaling $994,278) and the balance ($755,722)
payable for the outstanding shares of the Common Stock at $0.776901 per share
(rounded to the nearest $0.01), is fair, the Special Committee and the Board
gave considerable weight to the fairness opinion of Baum & Company that such
consideration is fair from a financial point of view. In determining that such
consideration was a fair price from a financial point of view, Baum & Company
reviewed each equity security separately. To determine the value of the
Preferred Stock, Baum & Company used two methods of valuation (1) liquidation
and (2) discounted cash flow at various discount rates. The liquidation method
results in the highest value of the two methods for the Preferred Stock. As of
the June 30, 1996 balance sheet shown in the Form 10-Q filed with the SEC, Baum
& Company determined the liquidation value of the Preferred Stock was $58.35.
Baum & Company determined that $58.35 per share of Preferred Stock was fair
from a financial point of view. This would aggregate approximately $946,000
for all Preferred Stock not presently owned by Ameribank. Baum & Company also
noted that the Company had not paid dividends on its outstanding Preferred
Stock since 1985.
To find the value of the Common Stock, Baum & Company used two methods of
valuation (1) (a) liquidation based on book value and (b) liquidation based on
the entity market value and (2) discounted cash flow at various discount rates.
Baum & Company used the following assumptions for the discounted cash flow
Common Stock value:
(1) The Common Stock did not have any dividend payments for 44
quarters or 11 years;
(2) The net interest spread used was based on 1995 and 1996 (10-K
1995, page 32) and was 4.45% with provision for loan losses at 0.45%
of the prior year's loan portfolio. This produced an average spread
on average interest earning assets of approximately 4.64%;
(3) Interest income grows at approximately 6.95% from the 1995
base;
(4) Income tax rate of 25.00% based on 1994 and 1995;
(5) Net after-tax income grows at approximately 6.50% from the
1995 base;
(6) In the year 2006, the earnings are projected to be $1,811,000
after tax. This gives the Company an equity value of $24,445,000
based on a multiple of 13.5 times.
<PAGE> 36
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From this number Baum & Company subtracted the Preferred Stock
redemption of $8,473,000 for a net of $15,972,000 for the Common
Stock, which when discounted back over the period at the differing
rates produced the following values:
<TABLE>
<CAPTION>
DISCOUNT RATE VALUE PER COMMON SHARE TOTAL COST TO REDEEM
- ------------- ---------------------- --------------------
<S> <C> <C>
25.00% $0.542 $ 530,000
22.50% $0.677 660,000
20.00% $0.849 825,000
17.50% $1.070 1,040,000
</TABLE>
Baum & Company's conclusion as to the Common Stock value existed in the
above range. The liquidation value based on book value was negative while the
liquidation value based on the entity market value places the value of the
Common Stock in the range shown above.
Baum & Company found support for the above pricing based on (1) The SNL
Pink Quarterly "Pink Sheet" and OTC-BB traded Banks and Thrifts dated September
1996 produced by SNL Securities on a quarterly basis; and (2) OTC Time & Sales
Report: 1/1/94 - 9/20/96 on the Company Common Stock produced by NASDAQ
Trading & Market Services. The NASDAQ information showed no sale in excess of
9/16 or 56.25c. per share and the last trade on 8/6/96 was at 1/4 or 25c. for
1,399 shares. The first trade listed as of 1/21/94 shows a price of $29.125
per share for 2,500 shares. Baum & Company called Nasdaq but were told no
further information was available and there was no way to verify the listed
price. Baum & Company assumed that the price was not correct.
Using the liquidation value based on the entity market value as well as
discounted cash flow, Baum & Company determined a value of $0.75 per share of
Common Stock was fair from a financial point of view. This would aggregate to
approximately $730,000 for all Common Stock not presently owned by Ameribank.
Baum & Company determined that Ameribank placed a value of $58.35 for each
share of Preferred Stock and $0.754 for each share of Common Stock, and that
these per share values would put the following total costs on the non-Ameribank
owned shares:
16,205 preferred shares @ $58.35 = $ 945,562
972,903 common shares @ $0.754 = 733,569
Total value for non-Ameribank equity = $1,679,131
Baum & Company determined that Ameribank's above overall value and each
equity piece value to be fair from a financial point of view.
Baum & Company did not consider the fairness from a financial point of
view of a minority discount since the Special Committee Counsel had advised
the Special Committee and Baum &
<PAGE> 37
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Company that Delaware and Oklahoma courts have held that minority discounts
were not applicable to the valuation of minority stock. A copy of Baum &
Company's fairness opinion dated October 25, 1996, is attached hereto as ANNEX
C and the supplemental fairness opinion, issued by Baum & Company, dated
January 23, 1997, is attached hereto as ANNEX D and both should be read in
their entirety. See "SPECIAL FACTORS -- Appointment of and Deliberations by
the Special Committee."
STRUCTURE AND PURPOSE OF THE MERGER
The Merger is not structured to require the approval of a majority of the
Shareholders excluding Ameribank. While this factor could be viewed as
unfavorable to a determination of fairness, the Company believes, based upon
the factors discussed above, that the terms of the Merger are fair to the
Shareholders (other than Ameribank).
The Merger has been structured as a merger of Ameribank and the Company in
order to effectuate the acquisition of all the outstanding shares of Common
Stock and Preferred Stock other than shares owned by Ameribank, thereby
transferring the entire equity interest in the Company to Ameribank. The
Company will merge into Ameribank and Ameribank will be the surviving
corporation.
In addition to providing the Company the additional flexibility in dealing
with its assets that is inherent in a closely held corporation, Ameribank
believes that the Company and its subsidiary, United, would benefit from the
reduction in costs associated with the termination of the Company's obligations
and reporting requirements under the securities laws. See "SPECIAL FACTORS --
Background of the Merger," "-- Proceedings of the Board and Recommendation of
the Special Committee Fairness of the Transaction" and "Alternatives to the
Merger."
Ameribank also believes that the Merger is fair to the Shareholders other
than Ameribank. The members of the Board of Directors of Ameribank did not
attach relative weight to the factors considered in reaching its conclusions.
See "SPECIAL FACTORS -- Proceedings of the Board and the Recommendation of the
Special Committee -- Fairness of the Transaction."
ALTERNATIVES TO THE MERGER
Prior to November 1994, the Board considered and verbally contacted other
bidders for the Common Stock and Preferred Stock; however, no interest in
bidding on the Company developed from these contacts.
The Board of Ameribank considered the following alternatives to the
Merger: (i) a further tender offer; (ii) private purchases; (iii) exchange of
Preferred Stock for Common Stock and a repurchase of the Common Stock by the
Company; (iv) exchange of shares of Common Stock for the Preferred Stock and
accrued dividends; and (v) a reverse stock split.
Ameribank rejected a further tender offer as the initial tender offer did
not result in the tender of as great a percentage of shares of Common Stock as
Ameribank had anticipated.
<PAGE> 38
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Ameribank continued to purchase shares of Stock in private transactions as set
out in "BENEFICIAL OWNERSHIP OF SHARES -- Certain Transactions in Common Stock
and Preferred Stock." After considering the other alternatives, Ameribank
decided to proceed with the Merger as the best long term strategy for the
Company which would consolidate the Company's business and operating structure
with a view to improving operations and reducing expenses of the Company by
eliminating the burden and cost for the Company to comply with the reporting
requirements of the Exchange Act and to maintain audited financial statements.
By eliminating the Company as a separate holding company, Ameribank would be
able to reduce operating costs caused by the duplication of legal and
accounting expenses, directors fees, administration costs and the costs of
preparing separate reports to the Federal Reserve Board, including the cost and
expense of separate banking examinations by the Federal Reserve Board.
Representatives of Ameribank also determined that due to potential conflicts of
interest of certain persons associated with Ameribank and the Company, an
independent opinion on the fairness of any transaction from a financial point
of view proposed by Ameribank would be required. Because of the lack of any
public market for shares of the Company's Common Stock or Preferred Stock,
Ameribank representatives also believed that a Merger based on financial terms
approved by an independent financial advisor would be in the best interests of
the Shareholders.
No alternatives were considered whereby the Shareholders other than
Ameribank would maintain an equity interest in the Company.
CERTAIN EFFECTS OF THE MERGER
If the proposed Merger is consummated, the holders of the Common Stock and
Preferred Stock other than Ameribank will no longer have an equity interest in
the Company and its subsidiary. Instead, each holder of Common Stock will
receive $0.776901 in cash, without interest, and each holder of Preferred Stock
will receive $58.35 in cash, without interest, for each such share held (other
than shares held by Ameribank).
The Company will, as a result of the Merger, become a privately held
company. Common Stock will cease trading entirely, the registration of Common
Stock under the Exchange Act will terminate and the Company will cease filing
reports with the Commission. Moreover, the Company will be relieved of the
obligation to comply with the proxy rules of Regulation 14A under Section 14 of
the Exchange Act and its officers, directors and 10% shareholders will be
relieved of the reporting requirements and restrictions on insider trading
under Section 16 of the Exchange Act. Accordingly, less information will be
required to be made publicly available than presently is the case.
As a result, the Company will be merged into Ameribank and Ameribank will
be the surviving entity. See "SPECIAL FACTORS -- Interests of Certain Persons
in the Merger, Conflicts of Interest" and "Certain Information Regarding
Ameribank."
<PAGE> 39
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INTERESTS OF CERTAIN PERSONS IN THE MERGER; CONFLICTS OF INTEREST
In considering the recommendation of the Board and the Special Committee
with respect to the Merger, Shareholders should be aware that three members of
the Board have certain interests in the Merger which are described below and
which are in addition to, and may conflict with the interests of Shareholders
generally, in connection with, the Merger Agreement.
THE COMPANY'S BOARD OF DIRECTORS. The Board is comprised of five
directors, three of whom are affiliated with Ameribank. Mr. Cook is a director
of the Company as well as its Chairman. He is also a director and the
Secretary of Ameribank and has served as the President and Chief Executive
Officer of ANB a subsidiary of Ameribank since December 16, 1992. Mr. Adcock
is a director and the Secretary of the Company. He is also a director of
Ameribank and ANB. Mr. Adcock is the son-in law of Mr. Bodard, the sole
shareholder of Ameribank. Mr. Schubert is a director and the President of the
Company as well as a Vice President, director and the Treasurer of Ameribank.
As officers and directors of Ameribank, Messrs. Cook, Schubert and Adcock have
been involved in every decision by Ameribank to acquire additional shares of
the Company. Mr. Nichols and Mr. Rappaport are directors of the Company.
Neither of them have any financial or personal interest in Ameribank and they
are not officers, directors, employees or stockholders of Ameribank.
OWNERSHIP OF THE COMPANY AFTER THE MERGER. After consummation of the
Merger, the entire equity interest in the Company will be owned by Ameribank.
Ameribank and Messrs. Cook, Schubert and Adcock have entered into a Stock
Purchase Agreement, dated November 3, 1995, which provides that Ameribank will
sell to each of Messrs. Cook, Schubert and Adcock 16.33% of the total number of
shares of Common Stock and Preferred Stock which Ameribank now owns or acquires
in future purchases. The terms provide that the purchase price for such Stock
shall be the price at which Ameribank acquired the shares plus costs incurred,
plus interest, accrued from the date of Ameribank's acquisition of such Stock
to the closing of the purchase contemplated by the agreement, at a rate equal
to the base rate of interest of Chase Manhattan Bank, N.A. from time to time.
The consummation of the transactions are subject to (1) approval from the
Federal Reserve System; (2) the entering into by the parties of a Shareholders'
Agreement restricting the future transfer of the Stock by Messrs. Adcock,
Schubert and Cook; and (3) the entering into by the parties of a Voting Trust
Agreement appointing Ameribank as Trustee to vote the shares of Common Stock.
On November 27, 1996, Mr. Adcock entered into an agreement with his wife, Dona
B. Adcock, transferring to her his rights to purchase shares of the Company
under the Stock Purchase Agreement. Mrs. Adcock is the daughter of Mr. Bodard,
the sole shareholder of Ameribank. Messrs. Cook and Schubert and Mrs. Adcock
have entered into an Addendum to the Stock Purchase Agreement with Ameribank
dated January 27, 1997, whereby Ameribank agrees that if the Merger is
consummated, Ameribank will sell to each of Messrs. Cook and Schubert and Mrs.
Adcock 16.33% of the total number of shares of common stock outstanding of
United at a price per share equal to the total consideration, plus costs and
interest paid by Ameribank for the Stock, divided by the total number of
outstanding shares of common stock of United, on the same terms and subject to
the same conditions as previously agreed.
<PAGE> 40
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DIRECTORS OF THE COMPANY AFTER THE MERGER. The Merger Agreement provides
that after the Merger, the current directors of Ameribank will continue as the
directors of the surviving corporation, until successors are duly elected or
appointed in accordance with applicable law.
EMPLOYMENT OF COMPANY'S EMPLOYEES. Ameribank has indicated that,
subsequent to the Merger, the current officers and employees of the Company
will remain in such capacities with the surviving corporation.
INDEMNIFICATION OF DIRECTORS AND OFFICERS. Under the Company's existing
Certificate of Incorporation, the Bylaws, the Merger Agreement, applicable
indemnification agreements, and under currently effective officers' and
directors' liability insurance, the Company's officers and directors may have
rights to indemnification with respect to any litigation relating to the
Merger. In addition, pursuant to certain terms of the Merger Agreement,
Ameribank has agreed to indemnify from the Effective Date of the Merger,
without limitation, each and every member of the Company's Board against any
claims arising out of the Merger. See "THE MERGER -- Certain Covenants of the
Company and Ameribank."
Nevertheless, based upon careful consideration of all of the factors
discussed in this Proxy Statement, the Board and the Special Committee believe
that the terms of the Merger are fair to the Shareholders (other than
Ameribank).
CERTAIN FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER.
The following is a brief description of the material federal income tax
consequences of the Merger. This summary contains general information and does
not address tax consequences that may be relevant to types of investors subject
to special treatment under the federal income tax laws (such as dealers in
securities, banks, insurance companies and foreign individuals and entities).
EACH SHAREHOLDER SHOULD CONSULT HIS OR HER OWN TAX ADVISORS WITH RESPECT TO THE
SPECIFIC TAX CONSEQUENCES OF THE MERGER TO HIM OR HER, INCLUDING THE
APPLICATION AND EFFECT OF FEDERAL, STATE, LOCAL AND FOREIGN TAX LAWS.
The exchange of shares of Common Stock for the Common Consideration and of
Preferred Stock for the Preferred Consideration in the Merger will be a taxable
transaction to the Shareholders. A Shareholder will recognize gain or loss
under federal income tax laws in an amount by which the proceeds received in
exchange for such shares exceed or are less than the holder's tax basis in the
shares. If the shares were a capital asset in the hands of the Shareholder,
such gain or loss would be capital rather than ordinary and, in such instances,
would be long term if the shares are considered to have been held more than one
year and short term if they are considered to have been held one year or less
on the date of the Merger. Currently, the maximum federal income tax rate on
capital gains is 28% as opposed to 39.6% for ordinary income. Capital losses
may be used to offset capital gains. For individuals, any capital losses in
excess of capital gains may be used to offset income from other sources of up
to $3,000 per year. Any remaining capital losses carry forward to future
years, subject to the same annual limits. For corporations, capital losses may
only
<PAGE> 41
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be used to offset capital gains. Any unused capital losses may generally be
carried back for three years and carried forward five years.
The waiver by Ameribank in connection with, and only in connection with,
the consummation of the Merger, of its right to receive the Common
Consideration or Preferred Consideration will not result in the recognition by
it of taxable gain.
The consummation of the Merger will not result in the recognition by the
Company of taxable gain.
Under the backup withholding rules, unless an exemption applies under the
applicable law and regulations, the Exchange Agent will be required to
withhold, and will withhold, 31% of all cash payments made in exchange for
shares of Stock unless the shareholder or other payee provides his tax
identification number (social security number, in the case of an individual, or
employer identification number, in the case of a corporation) and certifies
that such number is correct. Each shareholder and, if applicable, each other
payee should complete and sign the substitute Form W-9 to be included in the
transmittal materials and instructions relating to stock certificates to be
mailed to Shareholders as soon as practicable after the Effective Time, so as
to provide the information and certification necessary to avoid backup
withholding, unless an applicable exemption exists and is proved in a manner
satisfactory to the Company and the Exchange Agent.
APPRAISAL RIGHTS
The following is a summary of the provisions of Section 1091 of the OGCA
relating to appraisal rights. Section 1091 of the OGCA is reproduced in its
entirety as ANNEX B to this Proxy Statement, and this summary is qualified in
its entirety by reference to ANNEX B. Shareholders should read carefully ANNEX
B and, if they wish to exercise their rights to an appraisal, follow carefully
the procedures set forth therein. Any Shareholders considering demanding an
appraisal are advised to consult legal counsel.
Under Section 1091 of the OGCA, holders of record of shares of Common
Stock or Preferred Stock who do not wish to accept the Common Consideration or
Preferred Consideration have the right to seek an appraisal to determine the
fair value of their shares of Stock in the District Court. EACH SHAREHOLDER IS
URGED TO READ CAREFULLY THE MATERIALS CONTAINED IN THIS PROXY STATEMENT,
INCLUDING ANNEX B, AND THE OTHER MATERIALS INCORPORATED HEREIN IN MAKING A
DETERMINATION WHETHER TO ACCEPT THE COMMON CONSIDERATION OR PREFERRED
CONSIDERATION OR TO SEEK AN APPRAISAL PURSUANT TO THE OGCA. FAILURE TO COMPLY
WITH THE PROCEDURES SET FORTH HEREIN OR IN THE OGCA MAY RESULT IN A LOSS OF
THEIR APPRAISAL RIGHTS.
Each Shareholder who has not voted in favor of the Merger and who wishes
to assert a right to appraisal must make a written demand for the appraisal of
his or her shares of Stock to the Company at the address set forth below. A
VOTE AGAINST THE MERGER SHALL NOT
<PAGE> 42
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CONSTITUTE A DEMAND FOR APPRAISAL OF STOCK. Failure to make such demand before
the vote is taken to approve the Merger will eliminate a Shareholder's right to
an appraisal. The demand must reasonably inform the Company of the identity of
the Shareholder making the demand as well as the intention of such Shareholder
to demand an appraisal of the fair value of the shares of Stock held by such
Shareholder.
For purposes of making an appraisal demand, the address of the Company is:
United Oklahoma Bankshares, Inc., 4600 S.E. 29th Street, Del City, Oklahoma
73115, Attention: D. Wesley Schubert, President.
Only a holder of record of shares of Stock, or a person duly authorized
and explicitly purporting to act on the record holder's behalf, is entitled to
assert an appraisal right with respect to the shares of Stock registered in the
record holder's name. BENEFICIAL OWNERS WHO ARE NOT RECORD HOLDERS AND WHO
WISH TO EXERCISE APPRAISAL RIGHTS ARE ADVISED TO CONSULT PROMPTLY WITH THE
APPROPRIATE RECORD HOLDERS AS TO THE TIMELY EXERCISE OF APPRAISAL RIGHTS. A
record holder, such as a broker, who holds shares of Stock as a nominee for
others may exercise appraisal rights with respect to the shares of Stock held
for one or more beneficial owners, while not exercising such rights for other
beneficial owners. In such a case, the written demand should set forth the
number of shares of Stock as to which the demand is made. Where no shares of
and no class of Stock are expressly mentioned, the demand will be presumed to
cover all shares of Stock held in the name of such record holder.
A holder of shares of Stock held in "street name" who desires an appraisal
must take such actions as may be necessary to ensure that a timely and proper
demand for an appraisal is made by the record holder of such shares of Stock.
Shares of Stock held through brokerage firms, banks and other financial
institutions are frequently deposited with and held of record in the name of a
nominee of a central security depository. Any holder of shares of Stock
desiring an appraisal who held his or her shares of Stock through a brokerage
firm, bank or other financial institution is responsible for ensuring that the
demand for an appraisal is made by the record holder. The Shareholder should
instruct such firm, bank or institution that the demand for an appraisal must
be made by the record holder of the shares of Stock, which might be the nominee
of a central security depository if the shares of Stock have been so deposited.
As required by Section 1091 of the OGCA, a demand for an appraisal must
reasonably inform the Company of the identity of the record holder (which might
be a nominee as described above) and of such holder's intention to seek an
appraisal of such shares of Stock.
A demand for an appraisal of shares of Stock owned of record by two or
more joint holders must identify and be signed by or for all of the holders. A
demand for an appraisal signed by trustees, executors, administrators,
guardians, attorneys-in-fact, officers of corporations or others acting in a
fiduciary or representative capacity must so identify the persons signing the
demand.
An appraisal demand may be withdrawn by a Shareholder within 60 days after
the Effective Time, but thereafter the written approval of the Company is
needed for any such withdrawal. Upon withdrawal of an appraisal demand, a
holder of shares of Stock will be entitled to
<PAGE> 43
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receive the Common Consideration or Preferred Consideration. No interest will
be paid on this amount.
Within 120 days after the Effective Time (the "120-Day Period"), any
Shareholder who has properly demanded an appraisal and who has not withdrawn
his or her demand as provided above (such Shareholders are hereinafter referred
to collectively as the "Dissenting Shareholders") has the right to file in the
District Court a petition (the "Petition") demanding a determination of the
fair value of the dissenting shares of Stock (the "Dissenting Shares") held by
all of the Dissenting Shareholders. If, within the 120-Day Period, no Petition
shall have been filed as provided above, all rights to an appraisal will cease
and all of the Dissenting Shareholders will become entitled to receive the
Common Consideration or Preferred Consideration, without interest thereon after
the Effective Time, with respect to such Dissenting Shares of Stock. The
Company is not obligated and does not intend to file such a Petition. Any
Dissenting Shareholder is entitled, pursuant to a written request to the
Company made within the 120-Day Period, to receive from the Company a statement
setting forth the aggregate number of shares of Stock with respect to which
demands for appraisal have been received and the aggregate number of Dissenting
Shareholders.
Upon the filing of the Petition, service of a copy thereof is required to
be made upon the surviving corporation, which, within 20 days after such
service, must file in the office of the court clerk of the District Court in
which the Petition was filed, a duly verified list containing the names and
addresses of all Dissenting Shareholders. The District Court may order that
notice of the time and place fixed for the hearing on the Petition be sent by
registered or certified mail to the surviving corporation and all of the
Dissenting Shareholders, and be published at least one week before the day of
the hearing in a newspaper of general circulation published in the City of
Oklahoma City, Oklahoma or in another publication determined by the District
Court. The District Court will approve the form of notice by mail and by
publication. The costs relating to these notices will be borne by the Company.
If a hearing on the Petition is held, the District Court is empowered to
determine which Dissenting Shareholders have complied with the provisions of
Section 1091 of the OGCA and are entitled to an appraisal of their shares of
Stock. The District Court may require that Dissenting Shareholders submit
their Stock certificates which had represented shares of Common Stock or
Preferred Stock for notation thereon of the pendency of the appraisal
proceedings. The District Court is empowered to dismiss the proceedings as to
any Dissenting Shareholder who does not comply with such requirement.
Accordingly, Dissenting Shareholders are cautioned to retain their stock
certificates pending resolution of the appraisal proceedings.
Dissenting Shares of Common Stock will be appraised by the District Court
at their fair value as of the Effective Time, exclusive of any element of value
arising from the accomplishment or expectation of the Merger. The value so
determined for the shares of Stock could be equal to, more than or less than
the Common Consideration or Preferred Consideration, and could be based upon
considerations other than, in addition to, or the same as, the Common
Consideration or Preferred Consideration, the market value of the shares of
Common Stock, asset values and earning capacity. The Company reserves the
right to assert in any appraisal proceeding that the fair value of the shares
of Common Stock or Preferred Stock as of the Effective Time is less than the
Common Consideration or Preferred Consideration.
<PAGE> 44
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The District Court may also, on application, (i) determine a fair rate of
interest, simple or compound, if any, to be paid to Dissenting Shareholders in
addition to the value of the Dissenting Shares of Stock for the period from the
Effective Time to the date of payment, (ii) assess costs among the parties as
the District Court deems equitable, and (iii) order all or a portion of the
expenses incurred by any Dissenting Shareholder in connection with the
appraisal proceeding, including, without limitation, reasonable attorney's fees
and fees and expenses of experts, to be charged pro rata against the value of
all Dissenting Shares of Common Stock. Determinations by the District Court
are subject to appellate review by the Oklahoma Supreme Court.
Dissenting Shareholders are generally permitted to participate in the
appraisal proceedings. No appraisal proceeding in the District Court shall be
dismissed as to any Dissenting Shareholder without the approval of the District
Court, and this approval may be conditioned upon terms which the District Court
deems just.
From and after the Effective Time, Dissenting Shareholders will not be
entitled to vote their shares of Stock for any purpose and will not be entitled
to receive payment of dividends or other distributions in respect of such
shares of Common Stock payable to Shareholders of record thereafter.
FINANCING OF THE MERGER
Ameribank will be required to pay the Total Consideration of $1,700,000
under the Merger Agreement plus the expenses in connection with the Merger.
Ameribank has represented to the Company that it has sufficient cash to enable
it to consummate the Merger and that it will be funded through a certain line
of credit to Ameribank and a possible dividend from ANB to Ameribank. The line
of credit to Ameribank is evidenced by a revolving promissory note with
Boatmen's First National Bank of Kansas City ("Boatmen's"), dated May 15, 1996,
in the maximum principal amount of $2,700,000 with an interest rate equal to
0.050 percentage points less than the corporate base rate as established by the
bank from time to time and a maturity date of May 15, 1997. The current
corporate base rate is 8.25%. Ameribank is required to make quarterly payments
of interest only commencing August 15, 1996, with the unpaid principal balance
and all interest accrued due and payable in full on May 15, 1997. If Ameribank
reduces the principal amount of the note in the amount of $300,000 on May 15,
1997, Boatmen's intends to renew the note from time to time on substantially
the same terms and conditions. The principal balance on the note as of
December 31, 1996 was $100,000. Payment of the note is secured by a first
pledge and security interest covering 99,500 shares of the capital stock of
ANB, 702,266 shares of the Company's Common Stock and 92,790 shares of the
Company's Preferred Stock. Ameribank has received Boatmen's consent to the
Merger pursuant to a certain Consent to Merger dated, December 3, 1996.
<PAGE> 45
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EXPENSES OF THE MERGER
<TABLE>
<CAPTION>
EXPENSE ITEM ESTIMATED AMOUNT
<S> <C>
Common Consideration ............................................ $755,721.95
Preferred Consideration ......................................... 944,278.05
Printing and Mailing Costs ...................................... 4,958.35
Legal and Accounting Fees and Expenses
[Conner & Winters to advise on legal costs and appraisal fees for
Special Committee]............................................... 42,674 (est.)
Appraisal Fees .................................................. 41,831.11 *
-----------
</TABLE>
* Finley-$3,500.00; Baum & Company (1996/1997)-$23,400.00;
GRA, Petty & Co. (1995/1996)-$14,931.11)
CERTAIN LITIGATION CONCERNING THE PROPOSED MERGER
The Company is not subject to any material legal proceedings and no
litigation has been filed concerning the Merger.
THE MERGER
GENERAL
The Merger Agreement provides that, subject to the adoption of the Merger
Agreement by the Shareholders of the Company and compliance with certain other
covenants and conditions, the Company will be merged into Ameribank and
Ameribank will be the surviving corporation. All material terms of the Merger
Agreement have been disclosed in the body of this Proxy Statement. All
references to the terms and conditions of the Merger Agreement in this Proxy
Statement are qualified in their entirety by reference to the Merger Agreement,
a copy of which is attached hereto as ANNEX A.
At the Effective Time, each outstanding share of Common Stock (other than
shares of Common Stock held by Ameribank) will receive $0.776901 in cash,
without interest, and each outstanding share of Preferred Stock (other than
shares of Preferred Stock held by Ameribank) will receive $58.35 in cash,
without interest. In connection with, and only in connection with, the
consummation of the Merger, Ameribank is waiving its right to receive any of
the Total Consideration in exchange for the Common Stock or Preferred Stock
owned by it.
REQUIRED VOTE
The presence, in person or by properly executed proxy, of the holders of a
majority of the outstanding shares of Common Stock, as a class, and Preferred
Stock, as a class, is necessary to constitute a quorum at the Special Meeting.
Each Shareholder is entitled to one vote for each share of Common Stock and
each share of Preferred Stock held by such Shareholder. Under Oklahoma law,
the affirmative vote of holders of a majority of the shares of outstanding
Common Stock and Preferred Stock, each voting as a class at the Special Meeting
is required to approve the Merger. For purposes of a quorum, abstentions will
be counted as shares of Common Stock or Preferred Stock voted, while broker
non-votes will not be so counted. The Merger does not require the approval of
a majority of the Shareholders of the Company other than Ameribank. Because
Ameribank, which holds approximately 62% of the Common Stock and 89% of the
Preferred Stock, intends to vote its shares of Common Stock and Preferred Stock
in favor of the Merger, approval and adoption of the Merger Agreement is
expected.
<PAGE> 46
-43-
EFFECTIVE TIME
The Merger will become effective by filing a Certificate of Merger,
consistent with the Merger Agreement, with the Secretary of State of Oklahoma.
The Merger will be consummated only upon satisfaction or waiver, where
permissible, of the terms and conditions of the Merger Agreement and provided
that the Merger Agreement has not been terminated. The Merger Agreement may be
terminated by the mutual written consent of the Company and Ameribank, and
Ameribank may terminate the Merger Agreement at any time if there has been a
material adverse change in the business, assets, financial condition or
prospects of the Company. If the Merger has not been consummated by August 1,
1997, either the Company or Ameribank may terminate the Merger Agreement so
long as the reason that the Merger has not been consummated is not due to the
failure of the party choosing to terminate to fulfill any of its obligations
thereunder. No such waiver or termination will require the vote or consent of
the holders of Common Stock or Preferred Stock.
PAYMENT FOR SHARES OF COMMON STOCK AND PREFERRED STOCK
In order to receive the cash to which Shareholders will be entitled as a
result of the Merger, each holder of certificates representing shares of Stock
(other than Ameribank) will be required to surrender such holder's stock
certificate or certificates, together with a duly executed letter of
transmittal, to the Exchange Agent. Upon receipt of such certificate or
certificates together with a duly executed letter of transmittal, the Exchange
Agent will issue a check or draft to the person or persons entitled thereto in
an amount equal to $0.776901 (rounded to the nearest $0.01) for each share of
Common Stock and $58.35 for each share of Preferred Stock represented by such
stock certificate or certificates. If any payment for shares of Stock is to be
made in a name other than that in which the certificates for such shares of
Stock surrendered for payment are registered on the stock transfer books of the
Company as of the Effective Time, certificates so surrendered must be properly
endorsed or otherwise in proper form for transfer and the person requesting
such payment must pay to the Exchange Agent any transfer or other taxes
required by reason of the payment to a person other than the registered owner
of the certificate or certificates surrendered or shall establish to the
satisfaction of the Exchange Agent that such tax has been paid or is not
applicable. No interest will be paid or accrued on amounts payable upon the
surrender of any stock certificate.
Instructions with regard to the surrender of certificates, together with a
letter of transmittal to be used for this purpose, will be mailed to
Shareholders as promptly as practicable after the Effective Time. It also is
expected that letters of transmittal will be available at the office of the
Exchange Agent no later than the first business day following the Effective
Time. Shareholders should surrender certificates for shares of Common Stock
and Preferred Stock only with a letter of transmittal.
SHAREHOLDERS SHOULD NOT SEND IN ANY STOCK CERTIFICATES WITH THE ENCLOSED
PROXY CARD.
<PAGE> 47
-44-
CONDITIONS TO THE MERGER; WAIVER
The respective obligations of Ameribank and the Company to consummate the
Merger are subject to the satisfaction or waiver, on or before the Effective
Time, of the following conditions: (a) approval of the Merger and the Merger
Agreement at the Special Meeting by the affirmative vote of the holders of at
least a majority of the outstanding shares of Common Stock and Preferred Stock
at the Special Meeting, (b) approval of the Merger, if required, by the Board
of Governors of the Federal Reserve System and any other necessary regulatory
approvals, and (c) no applicable statute, rule or regulation which makes
consummation of the Merger illegal or otherwise prohibited nor any order,
decree, injunction or judgment enjoining the consummation of the Merger.
The obligations of Ameribank to consummate the Merger are subject to the
satisfaction or waiver, on or before the Effective Time, of the additional
conditions that: (a) the representations and warranties of the Company
contained in the Merger Agreement and in any certificate or other writing
delivered by the Company pursuant thereto shall be true and correct in all
material respects at and as of the Effective Time as if made at and as of such
time; (b) the Company shall have performed and complied in all material
respects with each obligation, agreement and covenant to be performed by and
complied with by it under the Merger Agreement at or prior to the Effective
Time; (c) receipt by Ameribank of a certificate signed by an executive officer
of the Company to the effect set forth in the preceding clauses (a) and (b);
(d) the holders of not more than 12% of the outstanding shares of Common Stock
shall have exercised their appraisal rights in the Merger in accordance with
Oklahoma law; (e) there has been no material adverse change in the business,
assets, financial condition or prospects of the Company; and (f) no action or
proceeding shall have been commenced or threatened for the purpose of obtaining
an injunction, order or damages before any court or governmental agency or
other regulatory or administrative agency or commission, domestic or foreign,
which Ameribank shall on advice of counsel reasonably determine would (1)
result in the imposition of material limitations on the ability of the Company
or Ameribank effectively to consummate the Merger, (2) have the effect of
rendering the Merger violative of any applicable law, or (3) have a material
adverse effect on the business, assets or financial condition of the surviving
corporation, which event is not within the reasonable control of Ameribank.
The obligations of the Company to consummate the Merger are subject to the
satisfaction or waiver, on or before the Effective Time, of the additional
conditions that: (a) the representations and warranties of Ameribank contained
in the Merger Agreement and in any certificate or other writing delivered by
Ameribank pursuant thereto shall be true and correct in all material respects
as of the Effective Time as if made at and as of such time (other than any
inaccuracies in such representations or warranties that are attributable to the
Company); (b) Ameribank shall have performed in all material respects all of
its obligations to be performed and complied with by it under the Merger
Agreement at or prior to the Effective Time; (c) receipt by the Company of a
certificate signed by an executive officer of Ameribank to the effect set forth
in the preceding clauses (a) and (b); and (d) no action or proceeding shall
have been commenced or threatened for the purpose of obtaining an injunction,
order or damages before any court or governmental agency or other regulatory or
administrative agency or commission, domestic or foreign, which the Company
shall on advice of counsel reasonably determine would (1) result in the
<PAGE> 48
-45-
imposition of material limitations on the ability of the Company or Ameribank
effectively to consummate the Merger, or (2) have the effect of rendering the
Merger violative of any applicable law.
The Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the "HSR Act")
provides that certain acquisition transactions may not be consummated unless
certain information has been furnished to the Antitrust Division of the
Department of Justice (the "Antitrust Division") and the Federal Trade
Commission (the "FTC") and certain waiting period requirements have been
satisfied. The Company believes that the HSR Act is not applicable to the
Merger. If the HSR Act were deemed to be applicable to the Merger, the
consummation of the Merger could be delayed pending compliance therewith.
The Antitrust Division and the FTC may scrutinize the legality under the
antitrust laws of transactions such as the Merger. Whether or not the HSR Act
is applicable, the Antitrust Division or the FTC could take any action under
the antitrust laws as it deems necessary or desirable in the public interest at
any time before or after the Merger. Such action may include seeking to enjoin
the Merger. Private parties may also seek to take action under the antitrust
laws. The Company's and Ameribank's obligation under the Merger is subject to
the condition, among others, that there shall not be instituted or pending any
action by any government or governmental authority or agency, domestic or
foreign, challenging the Merger.
The Company and Ameribank believe that the Merger does not violate the
applicable antitrust laws. Nevertheless, there can be no assurance that a
challenge to the Merger on antitrust grounds will not be made, or, if such
challenge is made, what the result will be.
Under the provisions of the Bank Holding Company Act of 1956, as amended
(12 U.S.C. Section 1841, et seq.) (the "Bank Holding Company Act") and the
regulations that have been promulgated thereunder, no bank holding company
shall merge or consolidate with any other bank holding company without the
prior approval of the Federal Reserve Board. Ameribank received approval from
the Federal Reserve Board for the July 1995 tender offer. Ameribank was
advised by the Federal Reserve Board on August 8, 1996 that because it
controlled more than fifty percent (50%) of the outstanding voting securities
of the Company after the tender offer, it would not be required to file an
application with the Federal Reserve Board to obtain approval for the Merger.
<PAGE> 49
-46-
Under the provisions of the Oklahoma Banking Code (Okla. Stat. tit. 6,
Section 218) (the "Oklahoma Banking Code"), the approval of the Commissioner
of the Oklahoma Banking Department is required when, in the opinion of the
Commissioner, the condition of any bank is such that the transfer of capital
stock of such bank would jeopardize the interest of its customers.
Contemporaneously with the filing of this Proxy Statement with the Commission,
a copy of the Proxy Statement will be submitted to the Oklahoma Banding
Department for approval.
CERTAIN COVENANTS OF THE COMPANY AND AMERIBANK
VOTE. The Company has agreed, in accordance with applicable law, to use
its best efforts to solicit from its Shareholders proxies in favor of the
approval of the Merger and the Merger Agreement.
PAYMENT OF EXPENSES. Whether or not the Merger is consummated, Ameribank
has agreed to pay all reasonable expenses and disbursements incurred in
connection with the transactions contemplated by the Merger Agreement.
INDEMNIFICATION. Ameribank has agreed, from the Effective Date of the
Merger, to indemnify, without limitation, each member of the Board against any
claims arising out of the Merger. Each member of the Board has additional
rights to indemnification and advance of expenses under the OGCA and the
Certificate of Incorporation and/or Bylaws of the Company as a director of the
Company or otherwise. In addition, pursuant to certain terms of the Merger
Agreement, Ameribank has agreed to indemnify from the Effective Date of the
Merger, without limitation, each and every member of the Board against any
claims arising out of the Merger.
TERMINATION AND AMENDMENTS
The Merger Agreement may be terminated before the Effective Time (a) by
the mutual written consent of the Boards of Directors of Ameribank and the
Company, (b) at any time by Ameribank if there has been a material adverse
change in the business, assets, financial condition or prospects of the
Company, or (c) by either the Board of Directors of Ameribank or the Company if
the Merger shall not have been consummated on or before August 1, 1997;
PROVIDED, HOWEVER, that neither party may terminate the Merger Agreement
pursuant to clause (b) if the failure of such party to fulfill any of its
obligations under the Merger Agreement shall have been the reason the Merger
shall not have been consummated on or before said date.
Subject to applicable law, the Merger Agreement may be amended, modified
and supplemented by the mutual consent of the Company and Ameribank (as
authorized by each Board of Directors) at any time prior to the Effective Time.
NO THIRD-PARTY BENEFICIARIES
The Merger is being consummated expressly and solely for the benefit of
the parties to the Merger Agreement and no other person is entitled or shall be
deemed to be entitled to any
<PAGE> 50
-47-
benefits or rights thereunder, nor shall be authorized or entitled to enforce
any rights, claims or remedies thereunder.
CERTAIN INFORMATION REGARDING AMERIBANK
Ameribank is an Oklahoma corporation with its principal offices located at
201 North Broadway, Shawnee, Oklahoma 74801.
Ameribank was organized in 1982 and is registered as a bank holding
company under the Bank Holding Company Act and primarily engaged, through its
banking subsidiary, ANB, in providing a full range of traditional banking and
related financial services to the commercial, consumer, energy, real estate,
agriculture and financial sectors, principally in the State of Oklahoma. The
principal business address of ANB is 201 North Broadway, Shawnee, Oklahoma
74801. Set forth below are the name, business address and present principal
occupation or employment, and material occupations, positions, offices or
employments for the past five years of each director and executive officer of
Ameribank. Except as otherwise noted, each director and executive officer of
the Ameribank is a citizen of the United States and has been employed in his or
her present principal occupation listed below during the last five years.
Mr. Don Bodard is Chairman of the Board of Directors and President of
Ameribank as well as the owner of Ameribank. Mr. Bodard also serves as a
director of ANB, and as a director of Unit Corporation, a New York Stock
Exchange Company. Mr. Bodard is the father-in-law of Mr. Adcock.
Mr. D. Wesley Schubert is a director and President of the Company and is a
director of United Bank, Del City, and its subsidiaries, United Del City Tower
and 4600 Corporation. Mr. Schubert has been the Vice Chairman of ANB and Vice
President of Ameribank since October 23, 1991. He is also a director of
Ameribank and the Treasurer. Mr. Schubert is Chairman of the Board of First
National Bank of Medicine Lodge, Kansas and a director of Medicine Lodge
Bancshares, Inc. Mr. Schubert has been employed in the past as a certified
public accountant by various investment, oil and gas, and banking businesses
owned by Mr. Bodard.
Since December 16, 1992, Mr. George N. Cook, Jr. has been President and
Chief Executive Officer of ANB and serves as a director and the Secretary of
Ameribank. Mr. Cook is a director of First National Bank of Medicine Lodge,
Kansas and Medicine Lodge Bancshares, Inc. He is the Chairman of the Board of
the Company and also the Chairman of the Board of United Bank, Del City, and
its subsidiaries, United Del City Tower, Inc. and 4600 Corporation. From 1990
to 1992, Mr. Cook was an Associate with the Kansas City bank consulting firm of
Swords & Associates.
Mr. J. Michael Adcock joined Ameribank full time as General Counsel on
March 1, 1996. Prior to that time he was engaged in the private practice of
law. He currently serves as a member of the Board of Directors of Grant
Geophysical, Inc., Ameribank, ANB, First National Bank of Medicine Lodge,
Kansas, Medicine Lodge Bancshares, Inc., the Company and United Bank, Del City,
and its subsidiaries, United Del City Tower and 4600 Corporation. Grant
<PAGE> 51
-48-
Geophysical filed a voluntary Chapter 11 bankruptcy petition in Delaware on
December 31, 1996. Mr. Adcock is the Secretary of the Company. Mr. Adcock
served in various management positions with Hadson Corporation (a New York
Stock Exchange Company) from 1983 to 1993, including Chief Executive Officer,
President and Chief Operating Officer and General Counsel. In October 1992,
Hadson Corporation filed a Chapter 11 bankruptcy petition and plan of
reorganization. The bankruptcy court confirmed the plan of reorganization in
November 1992 and the plan was consummated in December 1992. Mr. Adcock left
Hadson Corporation in December 1993.
Neither Ameribank nor any of its affiliates is subject to the information
and reporting requirements of the Exchange Act and, therefore, is not required
to file periodic reports, proxy statements or other information with the
Commission relating to their respective businesses, financial condition and
other matters. Ameribank is, however, required to file periodic reports and
other information with the Federal Reserve Board. Such periodic reports and
other information relating to Ameribank may be inspected and copied at the
offices of the Federal Reserve Bank of Kansas City, 925 Grand Ave, Kansas City,
Missouri 64198. ANB is also required to file quarterly reports of income and
condition with the Federal Deposit Insurance Corporation, 550 17th Street,
N.W., Washington D.C. 20429.
Financial information regarding Ameribank may be inspected and copied at
the offices of the Federal Reserve Bank of Kansas City as previously noted.
Financial Information regarding Ameribank is not included as Ameribank believes
that such information is not material to a decision by a Shareholder of the
Company whether to vote in favor of the Merger. Financing by Ameribank is not
a condition to the Merger. The Merger proposed is a cash transaction and not a
transaction involving an exchange of shares.
Ameribank owns approximately 62% of the Common Stock and 89% of the
Preferred Stock. Pursuant to the Merger Agreement, Ameribank will be the
surviving corporation in the Merger under the laws of Oklahoma. The
Certificate of Incorporation and Bylaws of Ameribank as in effect immediately
prior to the Effective Time will be the surviving corporation's Certificate of
Incorporation and Bylaws. The directors of Ameribank immediately prior to the
Effective Time will be the directors of the surviving corporation and the
officers of Ameribank immediately prior to the Effective Time will be the
officers of the surviving corporation.
DESCRIPTION OF CAPITAL STOCK OF THE COMPANY
CAPITAL STOCK.
The authorized capital stock of the Company consists of 10,650,000 shares
of stock comprised of 10,000,000 shares of Common Stock, $1.00 par value,
150,000 shares of 9% Cumulative Non-Voting Preferred Stock, $30.00 par value,
and 500,000 shares of Class B Preferred Stock, $1.00 par value. As of March
31, 1997, 1996, 2,532,237 shares of Common Stock were issued and outstanding
and held by approximately 450 Shareholders of record, 145,199 shares of
Preferred Stock were issued and outstanding, and held by approximately 86
Shareholders of record and no shares of Class B Preferred Stock were issued or
outstanding.
<PAGE> 52
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RECENT MARKET PRICES.
The Common Stock has never been listed on a national securities exchange
and is not currently quoted on the National Quotation Bureau's "Pink Sheets".
There is currently no established public trading market for the Company's
Common Stock. According to information supplied to the Company on Schedule 13D
filings with the Commission, Ameribank has paid $0.50 for shares of Common
Stock and Mr. Robert B. Krumme and his affiliates have paid between $0.50 and
$0.60 per share of Common Stock acquired between November 21, 1995 and December
24, 1995. Certain transactions in the Common Stock are set out in "SPECIAL
FACTORS -- Background of the Merger" and "BENEFICIAL OWNERSHIP OF SHARES --
Beneficial Ownership and -- Certain Transactions in Common Stock and Preferred
Stock."
DIVIDENDS.
The Company has 145,199 shares of Preferred Stock outstanding which have
an aggregate par value of $4,355,970. No dividends have been paid on the
Preferred Stock since October 1, 1985. Cumulative unpaid dividends at
September 30, 1996 amount to $4,312,450 or approximately $29.70 per share. All
accumulated dividends on Preferred Stock shall remain undeclared and unpaid
prior to and during the Merger. Until the accumulated dividends on the
Preferred Stock are paid, no dividends may be paid on the Common Stock.
Dividends have not been paid on the Common Stock in the last 44 quarters or 11
years.
BUSINESS OF THE COMPANY
OVERVIEW
The Company is an Oklahoma corporation with its principal executive
offices located at 4600 S.E. 29th Street, Del City, Oklahoma 73115.
The Company is a one-bank holding company registered under the Bank
Holding Company Act. The principal business of the Company is the ownership
and supervision of United. As of March 31, 1996, the Company and its
subsidiaries had approximately 50 full-time equivalent employees. United is a
state chartered banking association whose deposits are insured pursuant to the
Federal Deposit Insurance Act. United, which operates primarily in Oklahoma,
competes with other financial institutions in its trade area in providing a
full range of traditional banking and related financial services to the
commercial, consumer, energy, real estate and financial sectors. United Bank,
Del City, operates two wholly-owned subsidiaries, United Del City Tower, Inc.
and 4600 Corporation.
United Del City Tower, Inc. owns and manages the Bank Tower of which the
first and part of the second floors are occupied by United. The facility was
approximately 90% occupied at the end of 1996. 4600 Corporation was formed to
sell assets on which United, foreclosed.
The Company is subject to the information and reporting requirements of
the Exchange Act and, therefore, is required to file periodic reports, proxy
statements and other
<PAGE> 53
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information with the Commission relating to its business, financial condition
and other matters. Such annual and quarterly statements, proxy statements and
other information relating to the Company may be inspected and copied at the
Commission's public reference facilities at Judiciary Plaza, 450 Fifth Street,
N.W., Washington, D.C. 20549. see "Available Information." In addition, the
Company is required to file periodic reports and other information with the
Federal Reserve Board. Such periodic reports and other information relating to
the Company may be inspected and copied at the offices of the Federal Reserve
Bank of Kansas City, 925 Grand Ave, Kansas City, Missouri 64198.
TRANSACTIONS WITH AFFILIATES
American Imaging Center ("AIC") is a joint venture partnership composed of
ANB and United as joint venture partners. On September 1, 1996, AIC sold to
Data Center, Inc. ("DCI"), a Kansas corporation, all of the assets of AIC. For
a term of five years from the sale, DCI agreed to rebate to the joint venture
partners for new imaging processing customers utilizing services at AIC a
royalty of five percent (5%) of gross imaging processing revenues from new
customers, less pass through charges.
SELECTED CONSOLIDATED FINANCIAL DATA
The following table sets forth selected historical financial information
for the Company for each of the five years in the period ended December 31,
1996. The following information should be read in conjunction with "BUSINESS
OF THE COMPANY -- Management's Discussion and Analysis of Results of Operations
and Financial Condition". The Company's audited financial statements for the
fiscal years ended December 31, 1996, December 31, 1995, December 31, 1994 and
December 31, 1993 are incorporated herein by reference to the Company's Annual
Report on Form 10-K for the years ended December 31, 1996, December 31, 1995,
December 31, 1994 and December 31, 1993.
<PAGE> 54
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SELECTED FINANCIAL DATA
<TABLE>
<CAPTION>
Years ended December 31,
--------------------------------------------------------
1996 1995 1994 1993 1992
-------- -------- -------- -------- --------
(In thousands except per share amounts)
<S> <C> <C> <C> <C> <C>
Summary of Income:
Interest income ....................................... $ 6,454 6,015 5,160 5,235 5,460
Interest expense ...................................... (2,428) (2,569) (1,801) (1,847) (2,299)
Provision for loan losses ............................. (511) (279) (90) (236) (128)
Non-interest income ................................... 1,111 1,016 1,030 837 795
Non-interest expense .................................. (3,300) (3,155) (3,206) (3,068) (2,735)
Income (loss) before income taxes and cumulative
effect of change in accounting principle ............ 1,326 1,028 1,093 921 1,093
Income tax benefit (expense) .......................... (391) (253) (264) (266) (445)
Income (loss) before cumulative effect of change in
accounting principle ................................ 935 775 829 655 648
Cumulative effect of change in accounting principle ... -- -- -- 116 0
Net income (loss) ..................................... 935 775 829 771 648
Per share data:
Income (loss) before cumulative effect of change in
accounting principle ................................ $ 0.21 0.15 0.17 0.10 0.10
Cumulative effect of change in accounting principle ... -- -- -- 0.04 0.00
Net income (loss) ..................................... $ .021 0.15 0.17 0.14 0.10
Average outstanding common shares ..................... 2,532 2,532 2,616 2,644 2,644
Period end balances:
Cash and due from banks ............................... $ 3,070 2,584 2,440 1,907 3,270
Federal funds sold .................................... -- 6,300 -- 460 1,560
Investment securities ................................. 25,720 28,800 30,588 29,794 33,352
Loans, net of unearned discount and allowance for
loan losses ........................................... 50,273 43,604 41,401 36,509 33,804
Total assets ............................................ 84,051 86,071 79,720 74,564 78,556
Deposits ................................................ 73,120 76,270 69,647 66,094 70,302
Long-term debt .......................................... -- -- -- 450 900
Stockholders' equity .................................... 8,823 7,823 6,949 6,289 5,518
</TABLE>
<PAGE> 55
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As the Company's separate existence will be eliminated in the Merger, pro
forma data disclosing the effect of the Merger on its balance sheet, statement
of income, earnings per share amounts, ratio of earnings to fixed charges and
book value per share is not provided.
MANAGEMENT'S POSITION REGARDING THE RESULTS OF OPERATIONS AND FINANCIAL
CONDITION OF THE COMPANY
Management has prepared and is responsible for the consolidated financial
statements and related financial information which is contained in the
Company's Form 10-Ks and incorporated by reference into this Proxy Statement.
These financial statements were prepared in accordance with generally accepted
accounting principles which are consistently applied and appropriate in the
circumstances. The statements necessarily include amounts based on
management's best judgment and estimates.
The Company maintains accounting and other control systems, including
internal audits of its operations, to provide reasonable assurance that assets
are safeguarded and that the books and records reflect the authorized
transactions of the Company. Underlying the concept of reasonable assurance is
the premise that the cost of control should not exceed the benefit. Management
believes that the Company's accounting and other control systems appropriately
recognize this cost/benefit relationship.
The Company's independent accountants, KPMG Peat Marwick, L.L.P., provide
an independent objective assessment of the degree to which management meets its
responsibility for fairness in financial reporting. They evaluate the
Company's system of internal accounting control in determining the nature and
extent of audit tests and perform such tests and other procedures as they deem
necessary to reach and express an opinion on the financial statements.
The Board is responsible for reviewing and monitoring the Company's
financial reports and accounting practices. The Board meets to discuss audit
and financial reporting matters with representatives of management and the
independent accountants. The independent accountants have direct access to the
Board.
<PAGE> 56
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BENEFICIAL OWNERSHIP OF SHARES OF COMMON STOCK AND PREFERRED STOCK OF THE
COMPANY
Beneficial Ownership
The following table sets forth, to the best of the Company's knowledge,
the beneficial ownership of voting securities, as of March 31, 1997, with
respect to (i) each person or group known to the Company to own more than 5% of
the outstanding shares of Common Stock or Preferred Stock and (ii) each
director and executive officer of the Company.
SECURITY OWNERSHIP OF BENEFICIAL OWNERS
The security ownership of each person known by the Company to be the
beneficial owner of more than five percent (5%) of the Common Stock and
Preferred Stock as of April 1831, 1997 is as follows:
<TABLE>
<CAPTION>
NAME AND ADDRESS OF AMOUNT BENEFICIALLY
TITLE CLASS BENEFICIAL OWNER OWNED PERCENT OF OWNERSHIP
- --------------- --------------------- -------------------- --------------------
<S> <C> <C> <C>
Common Stock Ameribank Corporation 1,559,498 62%
201 N. Broadway
Shawnee, OK 74801
Common Stock Dona B. Adcock Right to acquire * 10.06%
201 N. Broadway 254,666
Shawnee, OK 74801
Common Stock Robert B. Krumme 238,492** 9.4%
P.O. Box 749
Bristow, OK 74010
Preferred Stock Ameribank Corporation 129,016 89%
201 N. Broadway
Shawnee, OK 74801
Preferred Stock Dona B. Adcock Right to acquire * 14.51%
201 N. Broadway 21,068
Shawnee, OK 74801
</TABLE>
** The number of shares of Common Stock includes 106,796 shares held by Sooner
Southwest Bankshares and 121,696 shares held by Illinois Refining Company, of
which Mr. Krumme claims beneficial ownership .
<PAGE> 57
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SECURITY OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS
The security ownership of each director and executive officer of the
Common Stock and Preferred Stock as of December 31, 1996 is as follows:
<TABLE>
<CAPTION>
NAME AND ADDRESS OF AMOUNT BENEFICIALLY
TITLE CLASS BENEFICIAL OWNER OWNED PERCENT OF OWNERSHIP
- --------------- --------------------- -------------------- --------------------
<S> <C> <C> <C>
Common Stock D. Wesley Schubert Right to acquire * 10.06%
201 N. Broadway 254,666
Shawnee, OK 74801
Common Stock George N. Cook , Jr. Right to acquire * 10.06%
201 N. Broadway 254,666
Shawnee, OK 74801
Preferred Stock D. Wesley Schubert Right to acquire * 14.51%
201 N. Broadway 21,068
Shawnee, OK 74801
Preferred Stock George N. Cook , Jr. Right to acquire * 14.51%
201 N. Broadway 21,068
Shawnee, OK 74801
</TABLE>
* Ameribank Corporation and Messrs. George N. Cook, D. Wesley Schubert and J.
Michael Adcock entered into a Stock Purchase Agreement, dated November 3, 1995,
which provides that Ameribank will sell to each of Messrs. Cook, Schubert and
Adcock 16.33% of the total number of shares of Common Stock and 9% Cumulative
Non-Voting Preferred Stock which Ameribank owns or acquires in future
purchases. The terms provide that the purchase price for such Stock shall be
the price at which Ameribank acquired the shares, plus costs incurred, plus
interest, accrued from the date of acquisition of such Stock to the closing of
the purchase contemplated by the agreement, at a rate equal to the base rate of
interest of Chase Manhattan Bank, N.A. from time to time. The consummation of
the transactions are subject to (1) approval from the Federal Reserve System;
(2) the entering into by the parties of a Shareholders' Agreement restricting
the future transfer of the Stock by Messrs. Adcock, Schubert and Cook; and (3)
the entering into by the parties of a Voting Trust Agreement appointing
Ameribank as Trustee to vote the shares of Common Stock. On November 27, 1996,
Mr. Adcock entered into an agreement with his wife, Dona B. Adcock,
transferring to her his rights to purchase shares of the Company under the
Stock Purchase Agreement. Mrs. Adcock is the daughter of Mr. Bodard, the sole
shareholder of Ameribank. Messrs. Cook and Schubert and Mrs. Adcock have
entered into an Addendum to the Stock Purchase Agreement dated January 27,
1997, whereby Ameribank agrees that if the Merger is consummated, Ameribank
will sell to each of Messrs. Cook and Schubert and Mrs. Adcock 16.33%
<PAGE> 58
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of the total number of shares of common stock outstanding of United at a price
per share equal to the total consideration, plus costs and interest paid by
Ameribank for the Stock, divided by the total number of outstanding shares of
common stock of United, and on the same terms and subject to the same
conditions as previously agreed.
CERTAIN TRANSACTIONS IN COMMON STOCK AND PREFERRED STOCK
The following tables set forth certain information concerning the Common Stock
and Preferred Stock acquired by Ameribank in private transactions since the
termination of the tender offer on December 29, 1995.
<TABLE>
<CAPTION>
COMMON STOCK
DATE OF PURCHASE NUMBER OF SHARES AMOUNT PAID
- ---------------- ---------------- -----------
<S> <C> <C>
*January 2, 1996 50,000 $0.50
January 24, 1996 22,368 $0.50
January 30,1996 1,000 $0.50
January 31, 1996 338 $0.50
March 4, 1996 1,100 $0.50
March 20, 1996 14,000 $0.50
April 10, 1996 2,676 $0.50
April 11, 1996 1,828 $0.50
May 7, 1996 6,000 $0.50
May 28, 1996 3,813 $0.50
June 4, 1996 264 $0.50
*June 6, 1996 840 $0.50
*June 6, 1996 4,959 $0.50
June 27, 1996 10,000 $0.50
</TABLE>
* The terms of agreements with sellers in these transactions included a
provision that in the event a higher price per share is paid by Ameribank to
other shareholders in a merger transaction occurring within one (1) year from
the date of such stock purchase agreement, Ameribank would pay to such seller
the difference in cash. The terms of the agreements, dated January 2, 1996,
with regard to
<PAGE> 59
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additional consideration have now expired. However, if the Merger is
consummated by June 6, 1997, Ameribank would be required to pay sellers in
other transactions identified above additional consideration to equal the
Common Consideration per share.
<TABLE>
<CAPTION>
COMMON STOCK
DATE OF PURCHASE NUMBER OF SHARES AMOUNT PAID
- ---------------- ---------------- -----------
<S> <C> <C>
January 2, 1996 832 $25.00
January 17, 1996 100 $25.00
March 13, 1996 44 $18.00
March 13, 1996 2,510 $30.00
April 1, 1996 1,296 $37.00
April 22, 1996 120 $35.00
May 10, 1996 300 $30.00
**June 3, 1996 15,787 $49.50
June 4, 1996 22 $30.00
**June 6, 1996 2,008 $49.50
</TABLE>
** The terms of agreements with sellers in these transactions included a
provision that in the event a higher price per share is paid by Ameribank to
other shareholders in a merger transaction occurring within one (1) year from
the date of such stock purchase agreement, Ameribank would pay to such seller
the difference in cash. If the Merger is consummated before May 31, 1997,
Ameribank will be required to pay sellers in the transactions identified above
additional consideration to equal the Preferred Consideration per share.
PROXY SOLICITATION
Proxies are being solicited by and on behalf of the Company. All expenses
of this solicitation, including the cost of preparing and mailing this Proxy
Statement, will be borne by Ameribank. In addition to solicitation by uses of
the mails, proxies may be solicited by directors, officers and employees of the
Company in person or by telephone, telegram or other means of communication.
Such directors, officers and employees will not be additionally compensated,
but
<PAGE> 60
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may be reimbursed for out-of-pocket expenses in connection with such
solicitation. Arrangements will also be made with custodians, nominees and
fiduciaries for forwarding of proxy solicitation material to beneficial owners
of Common Stock and Preferred Stock held of record by such persons, and
Ameribank may reimburse such custodians, nominees and fiduciaries for
reasonable expenses incurred in connection therewith.
CURRENT INFORMATION: DELISTING AND DEREGISTRATION
After the Effective Time, the Common Stock will cease trading entirely,
registration of Common Stock under the Exchange Act will terminate and the
Company will cease filing reports with the Commission. Moreover, the Company
will be relieved of the obligation to comply with the proxy rules of Regulation
14A under Section 14 of the Exchange Act, and its officers, directors and 10%
Shareholders will be relieved of the reporting requirements and "short-swing"
trading liability under Section 16 of the Exchange Act.
INDEPENDENT AUDITORS
Representatives of KPMG Peat Marwick, L.L.P., the Company's independent
auditors, are expected to be present at the Special Meeting and will have an
opportunity to make a statement should they desire to do so. Such
representatives are also expected to be available to respond to questions.
FUTURE SHAREHOLDER PROPOSALS
If the Merger is not consummated, any shareholder who wishes to present a
proposal for inclusion in the Proxy Statement for action at future Annual
Meetings of Shareholders must comply with the rules and regulations of the
Commission then in effect. The date by which such proposals must be received
by the Company for inclusion in the Company's Proxy Statement for the 1997
Annual Meeting has not yet been determined. If the Merger is not consummated,
the Company will inform holders of the Common Stock of the date by which such
proposals must be received by the Company for inclusion in the Company's Proxy
Statement for the 1997 Annual Meeting of Shareholders.
OTHER BUSINESS
The Board does not intend to bring any other matters before the Special
Meeting and does not know of any matters to be brought before the Special
Meeting by others. If any other matter should come before the Special Meeting,
it is the intention of the persons named in the accompanying proxy to vote the
proxy on behalf of the Shareholders they represent in accordance with their
best judgment.
<PAGE> 61
-58-
ANNEX A
AGREEMENT AND PLAN OF MERGER
This Agreement and Plan of Merger dated as of December 3, 1996 (this
"Agreement") is entered into by United Oklahoma Bankshares, Inc., an Oklahoma
corporation ("UOB") and Ameribank Corporation, an Oklahoma corporation
("Ameribank").
WHEREAS, Ameribank owns a majority of the shares of common stock and
preferred stock of UOB;
WHEREAS, a Special Committee of the Board of Directors of UOB (the
"Special Committee"), comprised of two (2) members of the Board of Directors of
UOB who do not have any financial or personal interest in Ameribank and who are
not officers, directors, employees or stockholders of Ameribank, were appointed
by the Board of Directors of UOB to, among other things, evaluate any proposal
by Ameribank to merge UOB with Ameribank and to negotiate, for and on behalf of
UOB, the terms and conditions of any merger of UOB with Ameribank and to make
recommendations to the Board of Directors of UOB regarding a merger of UOB with
Ameribank;
WHEREAS, pursuant to the negotiations between the Special Committee and
representatives of Ameribank, Ameribank has agreed to pay to the non-Ameribank
shareholders of UOB, in the aggregate, the sum of $1,700,000.00 in
consideration for the Merger (as hereinafter defined), with $58.35 per share to
be paid for each of the 16,183 shares of UOB preferred stock held by
non-Ameribank preferred stockholders (totaling $944,278.05) and $0.776901 per
share (rounded to the nearest $.01) to be paid for each of the 972,739 shares
of common stock of UOB held by non-Ameribank common stockholders (totaling
$755,721.95), which consideration the financial advisor to the Special
Committee has determined to be fair from a financial point of view;
WHEREAS, the parties hereto desire to effect the merger of UOB with and
into Ameribank (the "Merger") pursuant to the terms of this Agreement; and
WHEREAS, the Board of Directors of UOB, pursuant to the recommendations of
the Special Committee, and the Board of Directors of Ameribank have determined
that the Merger contemplated hereby is fair to and in the best interests of UOB
and its shareholders and Ameribank and its shareholders;
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements contained herein, the parties hereto agree as follow:
ARTICLE I
THE MERGER
SECTION 1. Meeting of UOB's Stockholders. UOB will take all action
necessary in accordance with applicable law to convene a meeting of its
stockholders (the "Special Meeting")
<PAGE> 62
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as promptly as practicable after the date hereof to consider and vote upon the
Merger. The Board of Directors of UOB, subject to its fiduciary duties as
advised by counsel, will recommend that UOB's stockholders vote in favor of the
Merger and the approval and adoption of this Agreement.
SECTION 1.1 Proxy Statement; Schedule 13E-3. As soon as practicable,
UOB shall file with the Securities and Exchange Commission (the "SEC") under
the Securities Exchange Act of 1934 (the "Exchange Act"), and shall use its
reasonable efforts to have cleared by the SEC, a proxy statement (together with
any amendments or supplements thereto, the "Proxy Statement"), with respect to
the Special Meeting. In addition, UOB and Ameribank shall file with the SEC
and make available to UOB's stockholders, as required by applicable law, a
joint Schedule 13E-3 (together with any amendments or supplements thereto, the
"Schedule 13E-3") with respect to the Special Meeting and the Merger.
Ameribank will provide all information relating to it or its affiliates (other
than UOB), for use in the preparation of the Proxy Statement and Schedule
13E-3. UOB will provide all information, other than that relating to Ameribank
or its affiliates (other than UOB), for use in the Proxy Statement and in the
Schedule 13E-3. The information provided and to be provided by UOB and
Ameribank, respectively, for use in the Proxy Statement and in the Schedule
13E-3 shall be true and correct in all material respects and shall not omit to
state any material fact necessary in order to make such information not
misleading as of the date of the Proxy Statement or the Schedule 13E-3, as the
case may be, and as of the date of the Special Meeting. UOB will promptly
advise Ameribank or Ameribank will promptly advise UOB, in writing, if at any
time prior to the Effective Time (as defined in Section 1.2) UOB or Ameribank
shall obtain knowledge of any facts that might make it necessary or appropriate
to amend or supplement the Proxy Statement or the Schedule 13E-3 in order to
make the statements contain or incorporated by reference therein not misleading
or to comply with applicable law. The Proxy Statement shall contain the
recommendation of the Board of Directors of UOB referred to in this Section 1
as well as the conclusion of the Board of Directors of UOB that the terms and
conditions of the Merger are fair to the stockholders of UOB (other than
Ameribank).
SECTION 1.2. The Merger. At the Effective Time, the Merger shall occur
in accordance with the Oklahoma General Corporation Act ("Oklahoma Law"),
whereupon the separate existence of UOB shall cease, and Ameribank shall be the
surviving corporation (the "Surviving Corporation"). As soon as practicable
after all the conditions set forth in Article VII have been satisfied or
waived, UOB and Ameribank will file, or cause to be filed, with the Secretary
of State of the State of Oklahoma a certificate of merger for the Merger in
accordance with Oklahoma Law (the "Certificate of Merger"). The Merger shall
become effective at the time such filing is made or at such other time as is
set forth in the Certificate of Merger (the "Effective Time"). From and after
the Effective Time, the Surviving Corporation shall possess all the rights,
privileges, powers and franchises and be subject to all of the restrictions,
disabilities, liabilities and obligations and duties of UOB and Ameribank, all
as provided under Oklahoma Law.
SECTION 1.3. Conversion of Outstanding Shares. At the Effective Time
Ameribank shall pay , in aggregate, to the non-Ameribank shareholders of UOB a
total of $1,700,000.00 (the "Total Consideration"), in cash, as consideration
for the Merger, payable as follows: (a) each share of Common Stock (as defined
in Section 2.2) of UOB (a "Share" and, collectively, the "Shares") outstanding
immediately prior to the Effective Time (except for the
<PAGE> 63
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Canceled Shares hereinafter referred to) shall, except as otherwise provided in
this Section 1.3, be converted into and shall receive $0.776901 (rounded to the
nearest $0.01) in cash (the "Merger Consideration"); (b) each share of
Preferred Stock (as defined in Section 2.2) of UOB (a Preferred Share and,
collectively, the Preferred Shares) outstanding immediately prior to the
Effective Time (except for the Canceled Shares hereinafter referred to) shall,
except as otherwise provided in this Section 1.3, be converted into and shall
receive $58.35 in cash (the "Preferred Merger Consideration"); (c) each Share
and each Preferred Share held by Ameribank or any subsidiary of Ameribank
outstanding immediately prior to the Effective Time (a "Canceled Share" and,
collectively, the "Canceled Shares") shall, by virtue of the Merger, and
without any action on the part of the holder thereof, be canceled and retired
and cease to exist, without any conversion thereof and shall not be entitled to
any of the consideration referred to in this Section 1.3; PROVIDED, HOWEVER,
that in connection with, and only in connection with, the consummation of the
Merger, Ameribank waives its right to receive, and shall not receive any
portion of the Total Consideration and consents to being treated less favorably
than the other stockholders of UOB; (d) each share of common stock of Ameribank
outstanding immediately prior to the Effective Time shall not be converted by
virtue of the Merger and each such outstanding share of common stock of
Ameribank shall remain issued and outstanding after the Merger; (e) each Share
held by UOB as treasury shares shall be canceled and retired without payment
thereof and; (f) each share of Class B Preferred Stock of UOB (as defined in
Section 2.2), none of which are issued and outstanding, shall be canceled and
retired without payment thereof.
1.3.1 Notwithstanding Section 1.3 (a) and (b), Shares and Preferred Shares
outstanding immediately prior to the Effective Time and held by a holder who
has not voted in favor of the Merger or consented thereto in writing and who
has demanded appraisal for such Shares and Preferred Shares in accordance with
Oklahoma Law shall not be converted into a right to receive the Merger
Consideration or Preferred Merger Consideration pursuant to such Section 1.3(a)
and 1.3(b) unless such holder fails to perfect or withdraws or loses the right
to appraisal but the holder thereof shall be entitled only to such rights and
to receive such consideration, if any, as may be determined pursuant to Section
1091 of the Oklahoma Law. If, after the Effective Time, such holder fails to
perfect or withdraws or loses the right to appraisal, such Shares or Preferred
Shares shall thereupon be deemed to have been converted into and shall receive,
at the Effective Time, the Merger Consideration pursuant to the terms of
Section 1.3 (a), or the Preferred Merger Consideration pursuant to the terms of
Section 1.3(b), without any interest thereon or addition thereto and such Share
or Preferred Share shall thereupon be canceled. UOB shall give Ameribank
prompt notice of any demands received by UOB for appraisal of Shares or
Preferred Shares, and Ameribank shall have the right to participate in all
negotiations and proceedings with respect to such demands. UOB shall not,
except with the prior written consent of Ameribank, make any payment with
respect to, or settle or offer to settle, any such demands.
SECTION 1.4. Surrender and Exchange. Promptly after the Effective Time,
the Surviving Corporation, or such bank or trust company acting as paying agent
(the "Paying Agent") for the Merger pursuant to an agreement in a form to be
mutually agreed upon by UOB and Ameribank, shall mail or cause to be mailed to
each holder of Shares and Preferred Shares (except the Canceled Shares) at the
Effective Time a letter of transmittal for use in surrendering for
<PAGE> 64
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exchange the certificate or certificates representing such Shares or Preferred
Shares. After the Effective Time, each such holder, upon surrender to the
Paying Agent of such certificate or certificates (together with such letter of
transmittal duly executed), will be entitled to receive the Merger
Consideration or the Preferred Merger Consideration. Until so surrendered,
each such certificate shall after the Effective Time represent for all purposes
only the right to receive the Merger Consideration or the Preferred Merger
Consideration, whichever is applicable. At the Effective Time, Ameribank shall
furnish or cause to be furnished to the Paying Agent good funds equal to the
aggregate of the Total Consideration payable to the holders of Shares and
Preferred Shares (except the Canceled Shares). After the Effective Time, there
shall be no further registration or transfers of Shares or Preferred Shares.
1.4.1 Prior to the Effective Time, the Surviving Corporation, with the
approval of UOB, shall establish reasonable procedures for the delivery of the
Merger Consideration or the Preferred Merger Consideration to holders of Shares
or Preferred Shares (except the Canceled Shares) whose stock certificates have
been lost, destroyed or mutilated. If any delivery of the Merger Consideration
or Preferred Merger Consideration is to be made pursuant to Section 1.3(a) or
Section 1.3(b) to a person other than the registered holder of the certificate
or certificates surrendered in exchange therefor, it shall be a condition to
such delivery that the certificate or certificates so surrendered shall be
properly endorsed or be otherwise in proper form for transfer and that the
person requesting such delivery shall (a) pay to the Paying Agent any transfer
or other taxes required as a result of delivery to a person other than the
registered holder or (b) establish to the satisfaction of the Paying Agent that
such tax has been paid or is not payable. Any holder of Shares or Preferred
Shares who has not exchanged the Shares or Preferred Shares for the Merger
Consideration or Preferred Merger Consideration in accordance with Section 1.4
within one (1) year after the Effective Time shall have no further claim upon
the Paying Agent and shall thereafter look only to the Surviving Corporation
for payment in respect of the Shares or Preferred Shares. Notwithstanding the
foregoing, no party hereto shall be liable to a holder of Shares or Preferred
Shares for any amount paid to a public official pursuant to applicable
abandoned property laws.
SECTION 1.5. Certificate of Incorporation. The Certificate of
Incorporation of Ameribank as in effect immediately prior to the Effective Time
shall be the Certificate of Incorporation of the Surviving Corporation until
amended in accordance with applicable law.
SECTION 1.6. By-Laws. The By-Laws of Ameribank as in effect immediately
prior to the Effective Time shall be the By-Laws of the Surviving Corporation
until amended in accordance with applicable law.
SECTION 1.7. Directors and Officers. From and after the Effective Time,
until successors are duly elected or appointed in accordance with applicable
law, (a) the directors of Ameribank at the Effective Time shall be the
directors of the Surviving Corporation and (b) the officers of Ameribank at the
Effective Time shall be the officers of the Surviving Corporation.
SECTION 1.8. Stock Transfer Books. At the Effective Time the stock
transfer books of UOB shall be closed and no transfer of shares of Common Stock
or Preferred Stock shall thereafter be made on such stock transfer books.
<PAGE> 65
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ARTICLE II
REPRESENTATIONS AND WARRANTIES OF UOB
SECTION 2. Representations and Warranties of UOB. UOB represents and
warrants to Ameribank that:
SECTION 2.1. Corporate Organization. UOB is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Oklahoma, and has all requisite corporate power and authority to own its
properties and assets and to conduct its businesses as now conducted.
SECTION 2.2. Capitalization. The authorized capital stock of UOB
consists of 10,650,000 shares of stock comprised of 10,000,000 shares of Common
Stock, par value $1.00 per share (the "Common Stock"), 2,532,237 shares of
which are issued and outstanding; 150,000 shares of 9% Cumulative Non-Voting
Preferred Stock, par value $30.00 per share (the "Preferred Stock"), 145,199
shares of which are issued and outstanding; and 500,000 shares of Class B
Preferred Stock, par value of $1.00 per shares ( the "Class B Preferred
Stock"), no shares of which are issued or outstanding. All shares of Common
Stock and Preferred Stock have been duly authorized and validly issued, and are
fully paid and nonassessable and no personal liability attaches to the
ownership thereof.
SECTION 2.3. Authorization and Validity of Agreement. UOB has the
corporate power to enter into this Agreement and to carry out its obligations
hereunder and to consummate the Merger subject to the approval of the Merger by
the shareholders of UOB, pursuant to the laws of the State of Oklahoma and the
Exchange Act, and approvals as may be required by the Board of Governors of the
Federal Reserve System ("Federal Reserve Approvals"). The execution and
delivery of this Agreement and the performance of UOB's obligations hereunder
have been duly authorized by all necessary corporate action, including, without
limitation, by the Board of Directors of UOB, except approval by the
shareholders of UOB pursuant to the laws of the State of Oklahoma and the
Exchange Act. The consummation of the Merger has been duly authorized by all
necessary corporate action, other than the affirmative vote of the stockholders
of UOB in accordance with applicable law and this Agreement, and approval of
the Merger by the stockholders of UOB has been recommended by the Board of
Directors of UOB. This Agreement has been duly executed by UOB and constitutes
the valid and binding obligation of UOB enforceable against UOB in accordance
with its terms, except (a) to the extent that enforceability may be limited by
applicable bankruptcy, insolvency, reorganization or other laws affecting the
enforcement of creditors' rights generally, and (b) that the availability of
equitable remedies, including specific performance, is subject to the
discretion of the court before which any proceeding therefor may be brought.
<PAGE> 66
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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF AMERIBANK
SECTION 3. Representations and Warranties of Ameribank. Ameribank
represents and warrants to UOB that:
SECTION 3.1. Corporate Organization. Ameribank is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Oklahoma and has all requisite corporate power and authority to own its
properties and assets and to conduct its business as now conducted.
SECTION 3.2. Title To Canceled Shares. All of the Canceled Shares are
owned of record and beneficially by Ameribank free and clear of all liens.
SECTION 3.3. Authorization and Validity of Agreement. Ameribank has the
corporate power to enter into this Agreement and to carry out its obligations
hereunder. The execution and delivery of this Agreement and the performance of
Ameribank's obligations hereunder have been duly authorized by the Board of
Directors and by the stockholders of Ameribank and no other proceedings on the
part of Ameribank are necessary to authorize such execution, delivery and
performance. This Agreement has been duly executed by Ameribank and is the
legal, valid and binding obligation of Ameribank, enforceable against Ameribank
in accordance with its terms, except (a) to the extent that enforceability may
be limited by applicable bankruptcy, insolvency, reorganization or other laws
affecting the enforcement of creditors' rights generally, and (b) that the
availability of equitable remedies, including specific performance, is subject
to the discretion of the court before which any proceeding therefor may be
brought.
SECTION 3.4. No Conflict or Violation. As of the date hereof and as of
the Effective Time, the execution, delivery and performance by Ameribank of
this Agreement and consummation of the Merger does not and will not (a) violate
or conflict with any provision of the charter documents or By-Laws of
Ameribank, or (b) violate any provision of law, or any order, judgment or
decree of any court or other governmental or regulatory authority.
SECTION 3.5. Consents and Approvals. As of the Effective Time, no
material consent, waiver, authorization or approval of any governmental or
regulatory authority, domestic or foreign, or of any other person, firm or
corporation, and no material declaration or notification to or filing or
registration with any such governmental or regulatory authority, is required on
the part of Ameribank in connection with the execution and delivery of this
Agreement by Ameribank, the performance of Ameribank of its obligations
hereunder, or the consummation of the Merger, other than in connection with or
in compliance with the applicable provisions of Oklahoma Law, the Exchange Act
or Federal Reserve Approval.
<PAGE> 67
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ARTICLE IV
COVENANTS OF UOB
SECTION 4. Covenants of UOB. UOB agrees that:
SECTION 4.1. Vote. UOB agrees that from and after the date hereof, UOB
will, to the extent permitted by applicable law or as otherwise reasonably
requested by Ameribank and in accordance with Oklahoma Law and its Certificate
of Incorporation and By-Laws, use its best efforts to (a) solicit from the
stockholders of UOB proxies in favor of the approval of this Agreement and (b)
take all other action necessary or helpful to secure a vote of stockholders in
favor of the Merger and to approve this Agreement.
SECTION 4.2. Access To Information. From and after the date hereof and
subject to the execution of such confidentiality agreements as UOB shall
reasonably require, UOB will give Ameribank and its counsel, financial
advisors, auditors and other authorized representatives reasonable access to
the offices, properties, books and records of UOB and will instruct UOB's
employees, counsel and financial advisors to cooperate with any such person in
its investigation of UOB.
ARTICLE V
COVENANTS OF AMERIBANK
SECTION 5. Covenants of Ameribank. Ameribank agrees that:
SECTION 5.1. Other Fees and Expenses. Ameribank will pay all reasonable
attorneys' fees, expenses and disbursements of UOB incurred prior to or after
the date hereof in connection with the transactions contemplated by this
Agreement.
SECTION 5.2. Vote. Ameribank will vote the Canceled Shares in favor of
the approval and adoption of this Agreement and the approval of the Merger.
SECTION 5.3. No Sale or Disposition; Waiver. From and after the date of
this Agreement and until the earlier of the Effective Time and the termination
of this Agreement, Ameribank will not sell or otherwise dispose of any Canceled
Shares or otherwise to facilitate the consummation of the transactions
contemplated by this Agreement.
SECTION 5.4 Indemnification. In addition to the rights and remedies of
each member of the Board of Directors of UOB (including, but not limited to,
members of the Special Committee) for indemnification and advances of expenses
(including, but not limited to, attorneys' fees) under the Oklahoma General
Corporation Act and the Certificate of Incorporation and/or Bylaws of UOB by
reason of the fact that he is or was a director of UOB or otherwise, from and
after the Effective Time Ameribank shall indemnify, defend and hold harmless,
without limitation, each and every member of the Board of Directors of UOB
(including, but not limited to, each member of the Special Committee) from and
against any and all claims, demands, suits, proceedings,
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actions, or causes of actions threatened or pending against any member of the
Board of Directors of UOB (including, but not limited to, members of the
Special Committee) or any and all losses, judgments, damages, liabilities,
costs and expenses (including, but not limited to, attorneys' fees) suffered or
incurred or which may be suffered or incurred by any member of the Board of
Directors of UOB (including, but not limited to, the members of the Special
Committee), relating to, or in connection with, or arising out of the Merger or
for any reason whatsoever as a result of being a member of the Board of
Directors of UOB (including, but not limited to, a member of the Special
Committee) in connection with, or relating to , or arising out of, the Merger,
this Agreement or any filings made by UOB with the SEC or any proxy statement
or schedules issued by UOB to its shareholders or others in connection with the
Merger.
ARTICLE VI
OTHER AGREEMENTS
SECTION 6. Additional Agreements. The parties hereto agree that:
SECTION 6.1. Best Efforts. Upon the terms and subject to the conditions
set forth in this Agreement, each party shall use its best efforts to take, or
cause to be taken, all actions and to do, or cause to be done, all things
necessary, proper or advisable under applicable laws and regulations, including
without limitation obtaining Federal Reserve Approval, to consummate the
transactions contemplated by this Agreement as promptly as possible.
SECTION 6.2. Notification of Certain Matters. Each party to this
Agreement will give prompt notice to the other parties hereof of: (a) any
notice or other communication from any person or entity alleging that the
consent of such person or entity is or may be required in connection with the
transactions contemplated by this Agreement; (b) any notice or other
communication from any governmental or regulatory agency or authority in
connection with the transactions contemplated by this Agreement; (c) any
action, suit, claim, investigation or proceeding commenced or, to its
knowledge, threatened against, relating to or involving or otherwise affecting
UOB on the one hand, or and/or Ameribank on the other hand, which is
reasonably likely to affect materially the transactions contemplated by this
Agreement; (d) the occurrence, or failure to occur, of any event or change in
circumstances where such occurrence or failure to occur would be likely to
cause any representation or warranty contained in this Agreement to be untrue
and inaccurate in any material respect at any time from the date hereof to the
Effective Time; and (e) any material failure of such party to comply with or
satisfy any covenant, condition or agreement to be complied with or satisfied
by it hereunder. No such notification shall affect the representations or
warranties of the parties or the conditions to the obligations of the parties
hereunder.
SECTION 6.3. Further Assurances. At and after the Effective Time, the
officers and directors of the Surviving Corporation will be authorized to
execute and deliver, in the name and on behalf of UOB , any deeds, bills of
sale, assignments or assurances and to take and do in the name and on behalf of
UOB, any other actions and things to vest, perfect or confirm of record or
otherwise in the Surviving Corporation any and all right, title and interest
in, to and under any of the
<PAGE> 69
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rights, properties or assets of UOB acquired or to be acquired by the Surviving
Corporation as a result of, or in connection with, the Merger.
ARTICLE VII
CONDITIONS TO THE MERGER
SECTION 7. Conditions To The Obligations of Each Party. The obligations
of UOB and Ameribank to consummate the Merger are subject to: (a) the approval
of the Merger and this Agreement at the Special Meeting of UOB stockholders by
the affirmative vote of at least a majority of each class of the stockholders
of UOB outstanding on the record date of such Special Meeting; (b) approval, if
required, of the transactions contemplated herein by the Board of Governors of
the Federal Reserve System and any other necessary regulatory approvals; and
(c) any applicable statute, rule or regulation which makes consummation of the
Merger illegal or otherwise prohibited or any order, decree, injunction or
judgment enjoining the consummation of the Merger.
SECTION 7.1. Conditions To The Obligation of UOB. The obligation of UOB
to consummate the Merger is subject to the satisfaction or waiver of the
following further conditions: (a) Ameribank shall have performed in all
material respects all of its obligations hereunder required to be performed by
it at or prior to the Effective Time; (b) the representations and warranties of
Ameribank contained in this Agreement and in any certificate or other writing
delivered by Ameribank pursuant hereto shall be true in all material respects
at and as of the Effective Time as if made at and as of such time (other than
any inaccuracies in such representations or warranties that are attributable to
UOB); (c) receipt by UOB of a certificate signed by an executive officer of
Ameribank to the effect set forth in this Section; and (d) no action or
proceeding shall have been commenced or threatened for the purpose of obtaining
an injunction, order or damages before any court or governmental agency or
other regulatory or administrative agency or commission, domestic or foreign,
which UOB shall on advice of counsel, reasonably determine would (1) result in
the imposition of material limitations on the ability of UOB or Ameribank
effectively to consummate the Merger; or (2) have the effect of rendering the
Merger violate of any applicable law.
SECTION 7.2. Conditions To The Obligation of Ameribank. The obligation
of Ameribank to consummate the Merger is subject to the satisfaction or waiver
of the following further conditions: (a) UOB shall have performed in all
material respects all of its obligations hereunder required to be performed by
it at or prior to the Effective Time; (b) the representations and warranties of
UOB contained in this Agreement and in any certificate or other writing
delivered by UOB pursuant hereto shall be true in all material respects at and
as of the Effective Time as if made at and as of such time; (c) receipt by
Ameribank of a certificate signed by an executive officer of UOB to the effect
set forth in paragraphs (a) and (b) of this Section; (d) the holders (except
for Ameribank and its affiliates) of not more than 12% of the outstanding
shares of Common Stock shall have exercised their appraisal rights in the
Merger in accordance with Oklahoma Law; (e) there has been no material adverse
change in the business, assets, financial condition, or prospects of UOB; and
(f) no action or proceeding shall have been commenced or threatened for the
purpose of obtaining an injunction, order or damages before any court or
governmental agency or other regulatory or administrative agency or commission,
domestic or foreign, which Ameribank shall on
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advice of counsel, reasonably determine would (1) result in the imposition of
material limitations on the ability of UOB or Ameribank effectively to
consummate the Merger; (2) have the effect of rendering the Merger violative of
any applicable law; or (3) have a material adverse effect on the business,
assets or financial condition of the Surviving Corporation, which event is not
within the reasonable control of Ameribank.
ARTICLE VIII
TERMINATION
SECTION 8 Termination. This Agreement may be terminated and the Merger
may be abandoned at any time prior to the Effective Time: (a) by mutual written
consent of UOB and Ameribank after approval of their respective Board of
Directors; (b) at any time by Ameribank if there has been a material adverse
change in the business, assets, financial condition or prospects of UOB; or (c)
by either UOB or Ameribank after approval of the Board of Directors of UOB or
Ameribank, as the case may be, if the Merger has not been consummated on or
before April 1, 1997; PROVIDED, HOWEVER, that neither party may terminate this
Agreement pursuant to this Section 8 if the failure of such party to fulfill
any of its obligations under this Agreement shall have been the reason that the
Merger shall not have been consummated on or before said date.
SECTION 8.1. Effect of Termination. If this Agreement is terminated
pursuant to Section 8, this Agreement shall become void and of no effect with
no liability on the party of any party hereto.
ARTICLE IX
MISCELLANEOUS
SECTION 9. General Matters.
SECTION 9.1. Notices. All notices, requests and other communications to
any party hereunder shall be in writing (including facsimile or similar
writing) and shall be given:
if to UOB to:
United Oklahoma Bankshares, Inc.
4600 S.E. 29th Street
Del City, Oklahoma 73115
Attn: Claude Rappaport, Chairman Special Committee
if to Ameribank to:
Ameribank Corporation
c/o D. Wesley Schubert
201 N. Broadway
Shawnee, OK 74801
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or such other address or facsimile number as such party may hereafter specify
by notice to the other party hereto. Each such notice, request or other
communication shall be effective (a) if given by facsimile, which such
facsimile is transmitted to the facsimile number specified in this Section and
the appropriate confirmation is provided, (b) if given via United States mail,
three days after such notice is deposited in the mail in a postage prepaid
envelope, or (c) if given by any other means, when delivered at the address
specified in this Section.
SECTION 9.2. Survival. None of the representations, warranties,
agreements or covenants contained herein shall survive the Effective Time
except for the agreements contained in Sections 1.2, 1.3, 1.4, 1.5, 1.6, 1.7,
1.8, 5.4 and 6.3.
SECTION 9.3. Amendment. Subject to applicable law, any provision of this
Agreement may be amended by the parties hereto, by action of each of their
respective Board of Directors or by their respective officers duly authorized
by such Board of Directors, at any time prior to the Effective Time. Any
amendment to this Agreement shall be in writing signed by all the parties
hereto.
SECTION 9.4. Waiver. At any time prior to the Effective Time, Ameribank
on the one hand, and UOB on the other hand, may (a) extend the time for the
performance of any agreement of the other party or parties hereto, (b) waive
any accuracy in the representations and warranties contained herein or in any
document delivered pursuant hereto, or (c) waive compliance with any agreement
or condition contained herein; PROVIDED, HOWEVER, that if such waiver would
have the same effect as any decrease of the amount or change in the type of the
Total Consideration or any amendment to Article VII, Article VIII or Section
9.3 hereof, such waiver shall also be approved by the respective Board of
Directors of each of UOB and Ameribank. Any agreement on the part of any party
to any such extension or waiver shall be effective only if set forth in a
writing signed on behalf of such party and delivered to the other parties. No
failure or delay by any party in exercising any right, power or privilege
hereunder shall operate as a waiver thereof nor shall any single or partial
exercise thereof preclude any other right, power or privilege. The rights and
remedies herein provided shall be cumulative and not exclusive of any rights or
remedies provided by law.
SECTION 9.5. Successors and Assigns. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns; PROVIDED, HOWEVER, that no party may assign
or otherwise transfer any of its rights under this Agreement without the
consent of the other parties hereto.
SECTION 9.6. Governing Law. This Agreement shall be construed in
accordance with and governed by the internal laws of the State of Oklahoma
without regard to principles of conflict of laws.
SECTION 9.7. Integration. This Agreement embodies the entire agreement
and understanding among the parties hereto and supersedes all prior agreements
and understandings relating to the subject matter hereof.
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SECTION 9.8. Headings and References. The headings of the Articles and
Sections of this Agreement are inserted for convenience only and shall not
constitute a part hereof.
SECTION 9.9. Counterparts; Effectiveness. This Agreement may be signed
in any number of counterparts, each of which shall be an original, with the
same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement shall become effective when each party hereto shall
have received counterparts hereof signed by the other party hereto.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
UNITED OKLAHOMA BANKSHARES, INC.
By: /s/ GEORGE N. COOK, JR.
---------------------------------
Name: George N. Cook, Jr.
Title: Chairman
AMERIBANK CORPORATION
By: /s/ D. WESLEY SCHUBERT
---------------------------------
NAME: D. WESLEY SCHUBERT
Title: Vice-President
<PAGE> 73
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FIRST AMENDMENT TO
AGREEMENT AND PLAN OF MERGER
This First Amendment to Agreement and Plan of Merger ("Amendment")
dated as of March 5, 1997 is entered into by United Oklahoma Bankshares, Inc.,
an Oklahoma corporation ("UOB") and Ameribank Corporation, an Oklahoma
corporation ("Ameribank").
WHEREAS, UOB and Ameribank entered into a certain Agreement and Plant
of Merger ("Agreement") dated December 3, 1996;
WHEREAS, UOB and Ameribank desire to amend the Agreement as stated
herein.
NOW THEREFORE, the parties to the Agreement, agree that the following
amendment to the Agreement should be made:
1. SECTION 8 of the Agreement shall be amended to read in its
entirety as follows:
"SECTION 8. Termination. This Agreement may be terminated
and the Merger may be abandoned at any time prior to the Effective
Time: (a) by mutual written consent of UOB and Ameribank after
approval of their respective Board of Directors; (b) at any time
by Ameribank if there has been a material adverse change in the
business, assets, financial condition or prospects of UOB; or (c)
by either UOB or Ameribank after approval of the Board of
Directors of UOB or Ameribank, as the case may be, if the Merger
has not been consummated on or before June 1, 1997; PROVIDED,
HOWEVER, that neither party may terminate this Agreement pursuant
to this Section 8 if the failure of such party to fulfill any of
its obligations under this Agreement shall have been the reason
that the Merger shall not have been consummated on or before said
date."
2. All of the terms, conditions, covenants, representations,
warranties and agreements contained in the Agreement, except as to the extent
amended by this Amendment, and
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all other documents, instruments and agreements made and delivered in
connection therewith, shall remain in full force and effect and continue to be
binding upon the parties hereto and thereto according to their respective
terms.
<PAGE> 75
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed by their respective authorized officers as of the day and year
first above written.
UNITED OKLAHOMA BANKSHARES, INC.
By: /s/ GEORGE N. COOK, JR.
---------------------------------
Name: George N. Cook, Jr.
Title: Chairman
AMERIBANK CORPORATION
By: /s/ D. WESLEY SCHUBERT
---------------------------------
NAME: D. WESLEY SCHUBERT
Title: Vice-President
<PAGE> 76
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ANNEX A
SECOND AMENDMENT TO
AGREEMENT AND PLAN OF MERGER
This Second Amendment to Agreement and Plan of Merger ("Amendment")
dated as of April 22, 1997 is entered into by United Oklahoma Bankshares, Inc.,
an Oklahoma corporation ("UOB") and Ameribank Corporation, an Oklahoma
corporation ("Ameribank").
WHEREAS, UOB and Ameribank entered into a certain Agreement and Plan
of Merger dated December 3, 1996, as amended by the First Amendment to
Agreement and Plan of Merger dated March 5, 1997 ("Agreement");
WHEREAS, UOB and Ameribank desire to amend the Agreement as stated
herein.
NOW THEREFORE, the parties to the Agreement, agree that the following
amendment to the Agreement should be made:
1. SECTION 8 of the Agreement shall be amended to read in its
entirety as follows:
"SECTION 8. Termination. This Agreement may be terminated
and the Merger may be abandoned at any time prior to the Effective
Time: (a) by mutual written consent of UOB and Ameribank after
approval of their respective Board of Directors; (b) at any time
by Ameribank if there has been a material adverse change in the
business, assets, financial condition or prospects of UOB; or (c)
by either UOB or Ameribank after approval of the Board of
Directors of UOB or Ameribank, as the case may be, if the Merger
has not been consummated on or before August 1, 1997; PROVIDED,
HOWEVER, that neither party may terminate this Agreement pursuant
to this Section 8 if the failure of such party to fulfill any of
its obligations under this Agreement shall have been the reason
that the Merger shall not have been consummated on or before said
date."
2. All of the terms, conditions, covenants, representations,
warranties and agreements contained in the Agreement, except as to the extent
amended by this Amendment, and all other documents, instruments and agreements
made and delivered in connection therewith, shall remain in full force and
effect and continue to be binding upon the parties hereto and thereto according
to their respective terms.
<PAGE> 77
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed by their respective authorized officers as of the day and year
first above written.
UNITED OKLAHOMA BANKSHARES, INC.
By: /s/ GEORGE N. COOK, JR.
---------------------------------
Name: George N. Cook, Jr.
Title: Chairman
AMERIBANK CORPORATION
By: /s/ D. WESLEY SCHUBERT
---------------------------------
NAME: D. WESLEY SCHUBERT
Title: Vice-President
<PAGE> 78
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ANNEX B
TITLE 18, OKLAHOMA STATUTES [CORPORATIONS]
CHAPTER 22. - GENERAL CORPORATION ACT
Section 1091. APPRAISAL RIGHTS.
Eff. Sept. 1, 1990.
A. Any shareholder of a corporation of this state who holds shares of
stock on the date of the making of a demand pursuant to the provisions of
subsection D of this section with respect to such shares, who continuously
holds such shares through the effective date of the merger or consolidation,
who has otherwise complied with the provisions of subsection D of this section
and who has neither voted in favor of the merger or consolidation nor consented
thereto in writing pursuant to the provisions of Section 1073 of this title
shall be entitled to an appraisal by the district court of the fair value of
his shares of stock under the circumstances described in subsections B and C of
this section. As used in this section, the word "shareholder" means a holder
of record of stock in a stock corporation and also a member of record of a
nonstock corporation; the words "stock" and "share" mean and include what is
ordinarily meant by those words and also membership or membership interest of a
member of a nonstock corporation. The provisions of this subsection shall be
effective only with respect to mergers or consolidations consummated pursuant
to an agreement of merger or consolidation entered into after November 1, 1988.
B. 1. Except as otherwise provided for in this subsection,
appraisal rights shall be available for the shares of any class or
series of stock of a constituent corporation in a merger or
consolidation, or of the acquired corporation in a share
acquisition, to be effected pursuant to the provisions of Sections
1081, 1082, 1086, 1087, or 1091.1 [PROBABLY SHOULD BE 1090.1] of
this title or Section 12 of this act [12 O.S. Section 1090.2].
2. a. No appraisal rights under this section shall
be available for the shares of any class or series of stock
which, at the record date fixed to determine the shareholders
entitled to receive notice of and to vote at the meeting of
shareholders to act upon the agreement of merger or
consolidation, were either:
(1) listed on a national securities
exchange; or
(2) held of record by more than two
thousand shareholders.
b. In addition, no appraisal rights shall be available for
any shares of stock of the constituent corporation surviving
a merger if the merger did not require for its approval the
vote of the shareholders of the surviving corporation as
provided for in subsection F of Section 1081 of this title.
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3. Notwithstanding the provisions of paragraph 2 of this
subsection, appraisal rights provided for in this section shall be
available for the shares of any class or series of stock of a
constituent corporation if the holders thereof are required by the
terms of an agreement of merger or consolidation pursuant to the
provisions of Sections 1081, 1082, 1086 or 1087 of this title to
accept for such stock anything except:
a. shares of stock of the corporation surviving or resulting
from such merger or consolidation; or
b. shares of stock of any other corporation which at the
effective date of the merger or consolidation will be either
listed on a national securities exchange or held of record by
more than two thousand shareholders; or
c. cash in lieu of fractional shares of the corporations
described in subparagraphs a and b of this paragraph; or
d. any combination of the shares of stock and cash in lieu of
the fractional shares described in subparagraphs a, b and c
of this paragraph.
4. In the event all of the stock of a subsidiary Oklahoma
corporation party to a merger effected pursuant to the provisions
of Section 1083 of this title is not owned by the parent
corporation immediately prior to the merger, appraisal rights shall
be available for the shares of the subsidiary Oklahoma corporation.
C. Any corporation may provide in its certificate of incorporation that
appraisal rights under this section shall be available for the shares of any
class or series of its stock as a result of an amendment to its certificate of
incorporation, any merger or consolidation in which the corporation is a
constituent corporation or the sale of all or substantially all of the assets
of the corporation. If the certificate of incorporation contains such a
provision, the procedures of this section, including those set forth in
subsections D and E of this section, shall apply as nearly as is practicable.
D. Appraisal rights shall be perfected as follows:
1. If a proposed merger or consolidation for which appraisal rights
are provided under this section is to be submitted for approval at
a meeting of shareholders, the corporation, not less than twenty
(20) days prior to the meeting, shall notify each of its
shareholders entitled to such appraisal rights that appraisal
rights are available for any or all of the shares of the
constituent corporations, and shall include in such notice a copy
of this section. Each shareholder electing to demand the appraisal
of the shares of the shareholder shall deliver to the corporation,
before the taking of the vote on the merger or consolidation, a
written demand for appraisal of the shares of the shareholder.
Such demand will be sufficient if it reasonably informs the
corporation of the identity of the shareholder and that the
shareholder intends thereby to demand the appraisal of the shares
of the shareholder. A proxy or vote
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against the merger or consolidation shall not constitute such a
demand. A shareholder electing to take such action must do so by a
separate written demand as herein provided. Within ten (10) days
after the effective date of such merger or consolidation, the
surviving or resulting corporation shall notify each shareholder of
each constituent corporation who has complied with the provisions
of this subsection and has not voted in favor of or consented to
the merger or consolidation as of the date that the merger or
consolidation has become effective; or
2. If the merger or consolidation was approved pursuant to the
provisions of Section 1073 or 1083 of this title, the surviving or
resulting corporation, either before the effective date of the
merger or consolidation or within ten (10) days thereafter, shall'
notify each of the shareholders entitled to appraisal rights of the
effective date of the merger or consolidation and that appraisal
rights are available for any or all of the shares of the
constituent corporation, and shall include in such notice a copy of
this section. The notice shall be sent by certified or registered
mail, return receipt requested, addressed to the shareholder at the
address of the shareholder as it appears on the records of the
corporation. Any shareholder entitled to appraisal rights may,
within twenty (20) days after the date of mailing of the notice,
demand in writing from the surviving or resulting corporation the
appraisal of the shares of the shareholder. Such demand will be
sufficient if it reasonably informs the corporation of the identity
of the shareholder and that the shareholder intends to demand the
appraisal of the shares of the shareholder.
E. Within one hundred twenty (120) days after the effective date of the
merger or consolidation, the surviving or resulting corporation or any
shareholder who has complied with the provisions of subsections A and D of this
section and who is otherwise entitled to appraisal rights, may file a petition
in district court demanding a determination of the value of the stock of all
such shareholders. Provided, however, at any time within sixty (60) days after
the effective date of the merger or consolidation, any shareholder shall have
the right to withdraw the demand of the shareholder for appraisal and to accept
the terms offered upon the merger or consolidation. Within one hundred twenty
(120) days after the effective date of the merger or consolidation, any
shareholder who has complied with the requirements of subsections A and D of
this section, upon written request, shall be entitled to receive from the
corporation surviving the merger or resulting from the consolidation a
statement setting forth the aggregate number of shares not voted in favor of
the merger or consolidation and with respect to which demands for appraisal
have been received and the aggregate number of holders of such shares. Such
written statement shall be mailed to the shareholder within ten (10) days after
the shareholder's written request for such a statement is received by the
surviving or resulting corporation or within ten (10) days after expiration of
the period for delivery of demands for appraisal pursuant to the provisions of
subsection D of this section, whichever is later.
F. Upon the filing of any such petition by a shareholder, service of a
copy thereof shall be made upon the surviving or resulting corporation, which,
within twenty (20) days after such service, shall file in the office of the
court clerk of the district court in which the petition was filed a duly
verified list containing the names and addresses of all shareholders who have
demanded
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payment for their shares and with whom agreements as to the value of their
shares have not been reached by the surviving or resulting corporation. If the
petition shall be filed by the surviving or resulting corporation, the petition
shall be accompanied by such a duly verified list. The court clerk, if so
ordered by the court, shall give notice of the time and place fixed for the
hearing of such petition by registered or certified mail to the surviving or
resulting corporation and to the shareholders shown on the list at the
addresses therein stated. Such notice shall also be given by one or more
publications at least one (1) week before the day of the hearing, in a
newspaper of general circulation published in the City of Oklahoma City,
Oklahoma, or such publication as the court deems advisable. The forms of the
notices by mail and by publication shall be approved by the court, and the
costs thereof shall be borne by the surviving or resulting corporation.
G. At the hearing on such petition, the court shall determine the
shareholders who have complied with the provisions of this section and who have
become entitled to appraisal rights. The court may require the shareholders
who have demanded an appraisal for their shares and who hold stock represented
by certificates to submit their certificates of stock to the court clerk for
notation thereon of the pendency of the appraisal proceedings; and if any
shareholder fails to comply with such direction, the court may dismiss the
proceedings as to such shareholder.
H. After determining the shareholders entitled to an appraisal, the court
shall appraise the shares, determining their fair value exclusive of any
element of value arising from the accomplishment or expectation of the merger
or consolidation, together with a fair rate of interest, if any, to be paid
upon the amount determined to be the fair value. In determining such fair
value, the court shall take into account all relevant factors. In determining
the fair rate of interest, the court may consider all relevant factors,
including the rate of interest which the surviving or resulting corporation
would have to pay to borrow money during the pendency of the proceeding. Upon
application by the surviving or resulting corporation or by any shareholder
entitled to participate in the appraisal proceeding, the court may, in its
discretion, permit discovery or other pretrial proceedings and may proceed to
trial upon the appraisal prior to the final determination of the shareholder
entitled to an appraisal. Any shareholder whose name appears on the list filed
by the surviving or resulting corporation pursuant to the provisions of
subsection F of this section and who has submitted the certificates of stock of
the shareholder to the court clerk, if such is required, may participate fully
in all proceedings until it is finally determined that the shareholder is not
entitled to appraisal rights pursuant to the provisions of this section.
I. The court shall direct the payment of the fair value of the shares,
together with interest, if any, by the surviving or resulting corporation to
the shareholders entitled thereto. Interest may be simple or compound, as the
court may direct. Payment shall be so made to each such shareholder, in the
case of holders of uncertificated stock immediately, and in the case of holders
of shares represented by certificates upon the surrender to the corporation of
the certificates representing such stock. The court's decree may be enforced
as other decrees in the district court may be enforced, whether such surviving
or resulting corporation be a corporation of this state or of any other state.
J. The costs of the proceeding may be determined by the court and taxed
upon the parties as the court deems equitable in the circumstances. Upon
application of a shareholder, the
<PAGE> 82
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court may order all or a portion of the expenses incurred by any shareholder in
connection with the appraisal proceeding, including, without limitation,
reasonable attorney's fees and the fees and expenses of experts, to be charged
pro rata against the value of all of the shares entitled to an appraisal.
K. From and after the effective date of the merger or consolidation, no
shareholder who has demanded the appraisal rights of the shareholder as
provided for in subsection D of this section shall be entitled to vote such
stock for any purpose or to receive payment of dividends or other distributions
on the stock, except dividends or other distributions payable to shareholders
of record at a date which is prior to the effective date of the merger or
consolidation; provided, however, that if no petition for an appraisal shall be
filed within the time provided for in subsection E of this section, or if such
shareholder shall deliver to the surviving or resulting corporation a written
withdrawal of the shareholder's demand for an appraisal and an acceptance of
the merger or consolidation, either within sixty (60) days after the effective
date of the merger or consolidation as provided for in subsection E of this
section or thereafter with the written approval of the corporation, then the
right of such shareholder to an appraisal shall cease. Provided, however, no
appraisal proceeding in the district court shall be dismissed as to any
shareholder without the approval of the court, and such approval may be
conditioned upon such terms as the court deems just.
L. The shares of the surviving or resulting corporation into which the
shares of such objecting shareholders would have been converted had they
assented to the merger or consolidation shall have the status of authorized and
unissued shares of the surviving or resulting corporation.
<PAGE> 83
-80-
ANNEX C
GEORGE K. BAUM & COMPANY
Investment Bankers
Member Twelve Wyandotte Plaza
New York Stock Exchange, Inc. 120 West 12th Street
Chicago Stock Exchange, Inc. Kansas City, Missouri 64105
October 25, 1996 Telephone (816) 474-1100
Special Committee of the Board
United Oklahoma Bankshares, Inc.
c/o Mr. Claude Rappaport
Chairman, Special Committee of the Board
1506 Bedford Drive
Oklahoma City, OK 73116
Dear Gentlemen:
You have asked us to render our opinion as to the fairness, from a
financial point of view, to the proposed cash out merger offer of $1,300,000 by
Ameribank Corporation ("Ameribank") for all the remaining Preferred Stock
("Preferred") (approximately 11.16%) and Common Stock ("Common") (approximately
38.42%) and of United Oklahoma Bankshares, Inc. (the "Company") not presently
owned by Ameribank.
Our approach as to the fairness of the Ameribank offer was to look at each
of the equity pieces separately, for pricing purposes. This was done to see
what was "FAIR" for each security.
To find the value of the Preferred, two methods of value were used (1)
liquidation and (2) discounted cash flow at various discount rates. The
liquidation method places the highest value of the two methods on the
Preferred. As of the June 30, 1996 balance sheet shown in the Form 10-Q filed
with the Securities and Exchange Commission ("SEC"), the liquidation value of
the Preferred would be $58.35. The $58.35 value per share of Preferred is fair
from a financial point of view. This would aggregate to approximately $946,000
for all Preferred not presently owned by Ameribank.
To find the value of the Common, two methods of value were used (1) (a)
liquidation based on book value and (b) liquidation based on the entity market
value and (2) discounted cash flow at various discount rates.
The discounted cash flow is a little more complicated because of the
"rights" of the preferred and the preferred stock's cumulative dividends.
These are the following assumptions used for the discounted cash flow Common
value:
<PAGE> 84
-81-
(1) The Common does not have any dividend payments for 44
quarters or 11 years;
(2) The net interest spread used is based on 1995 and 1996 (10-K
1995, page 32) and is 4.45% with provision for loan losses at 0.45%
of the prior year's loan portfolio. This produces an average spread
on average interest earning assets of approximately 4.64%;
(3) Interest income grows at approximately 6.95% from the 1995
base;
(4) Income tax rate of 25.00% based on 1994 and 1995;
(5) Net after-tax income grows at approximately 6.50% from the
1995 base;
(6) In the year 2006, the earnings are projected to be $1,811,000
after tax. This gives the Company an equity value of $24,445,000
based on a multiple of 13.5 times. From this number we need to
subtract the Preferred redemption of $8,473,000 for a net of
$15,972,000 for the Common, which when discounted back over the
period at the differing rates produces the following values:
<TABLE>
<CAPTION>
DISCOUNT RATE VALUE PER COMMON SHARE TOTAL COST TO REDEEM
------------- ---------------------- --------------------
<S> <C> <C>
25.00% $0.542 $ 530,000
22.50% 0.677 660,000
20.00% 0.849 825,000
17.50% 1.070 1,040,000
</TABLE>
Our conclusion as to the Common value exists in the above range. The
liquidation value based on book value is negative while the liquidation
value based on the entity market value places the value of the Common in
the range shown above.
We find support for the above pricing based on (1) The SNL Pink Quarterly
"Pink Sheet" and OTC-BB traded Banks and Thrifts dated September 1996
produced by SNL Securities on a quarterly basis; and (2) OTC Time & Sales
Report: 1/1/94 - 9/20/96 on the Company's common stock produced by
Nasdaq Trading & Market Services. The Nasdaq information shows no sale
in excess of 9/16 or 56.25c. per share and the last trade on 8/6/96 was
at 1/4 or 25c. for 1,399 shares. The first trade listed as of 1/21/94
shows a price of $29.125 per share for 2,500 shares. We called Nasdaq
but were told that was the information they had and there was no way to
verify it. We assume that price is not correct.
Using the liquidation value based on the entity market value as well as
discounted cash flow, a value of $0.75 per share of Common is fair from a
financial point of view. This would aggregate to approximately $730,000
for all Common not presently owned by Ameribank.
<PAGE> 85
-82-
Based on information supplied by Ameribank, they placed a total entity
value range on the Company of $10,382,000 on the high side and $10,216,973 on
the low side. Ameribank placed a value of $58.35 for each Preferred share and
$0.754 for each Common share. These per share values would put the following
total costs on the non-Ameribank owned shares:
16,205 preferred shares @ $58.35 = $ 945,562
972,903 common shares @ $0.754 = 733,569
Total value for non-Ameribank equity = $1,679,131
We find Ameribank's overall value for the Company and each equity piece to
be fair from a financial point of view. Our understanding is that, according
to the legal counsel for the Special Committee of the Board of Directors of the
Company, Mr. Irwin H. Steinhorn, no discounts of any nature may be applied to a
cash out merger such as that proposed by Ameribank.
You can reach me at 816-283-5280.
Respectfully submitted,
GEORGE K. BAUM & COMPANY
<PAGE> 86
-83-
ANNEX D
GEORGE K. BAUM & COMPANY
Investment Bankers
Member Twelve Wyandotte Plaza
New York Stock Exchange, Inc. 120 West 12th Street
Chicago Stock Exchange, Inc. Kansas City, Missouri 64105
January 23, 1997 Telephone (816) 474-1100
Special Committee of the Board
United Oklahoma Bankshares, Inc.
c/o Mr. Claude Rappaport
Chairman, Special Committee of the Board
1506 Bedford Drive
Oklahoma City, OK 73116
Dear Gentlemen:
You have asked us to render our opinion as to the fairness, from a
financial point of view, to the proposed cash out merger offer of $1,700,000 by
Ameribank Corporation ("Ameribank") for all the remaining Preferred Stock
("Preferred") (approximately 11.16%) at $58.35 per share and Common stock
("Common") (approximately 38.42%) at approximately $0.776 per share of United
Oklahoma Bankshares, Inc. (the "Company") not presently owned by Ameribank.
We issued such a letter, dated October 25, 1996, based on the information
that had been requested and supplied to us. Information requested and supplied
to us at that date had indicated that the highest price Ameribank had paid for
the Preferred was $18.00. On January 17, 1997, we were informed by the
information in the Form 4 filings with the U.S. Securities and Exchange
Commission that Ameribank had purchased Preferred shares at prices higher than
$18.00, prior to October 25, 1996, (the highest price was $49.50 per share).
Some of these purchases were done with agreements that, for one year from the
date of purchase, Ameribank would pay these sellers the same price, if higher,
that Ameribank paid for the remaining Preferred that Ameribank did not own at
the time of those purchases.
With this additional Preferred pricing information considered, we still
find Ameribank's overall offer for the Company and each equity price to be fair
from a financial point of view as set forth in our letter dated October 25,
1996.
Respectfully Submitted,
GEORGE K. BAUM & COMPANY
<PAGE> 87
UNITED OKLAHOMA BANKSHARES, INC.
PROXY OF SPECIAL MEETING OF SHAREHOLDERS
_________, 1997
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
KNOW ALL MEN BY THESE PRESENTS:
That the undersigned holder(s) of stock of United Oklahoma Bankshares,
Inc. an Oklahoma corporation, does hereby constitute and appoint George N.
Cook, Jr. and J. Michael Adcock as true and lawful attorneys and proxies for
the undersigned, each with full power of substitution and revocation, to vote
for and in the name, place and stead of the undersigned at the Special Meeting
of Stockholders of the Company to be held at 4600 S.E. 29th Street, Del City,
Oklahoma, 73115 on _____________, 1997, at __________ p.m., and any adjournment
thereof, all of the stock of the Company which the undersigned would be
entitled to vote if then personally present, hereby revoking any Proxy
heretofore given.
This Proxy will confer discretionary authority to vote upon matters
incidental to the conduct of the meeting and matters not known to management
prior to the date of the Proxy Statement, which are properly presented to the
meeting.
1. To Approve and Adopt the Agreement and Plan of Merger dated as of
December 3, 1996, (the "Merger Agreement") between the Company and
Ameribank Corporation as described in the Proxy Statement.
______For
______Against
______Abstain
2. To empower and authorize the offices of the Company to perform such
acts and sign and deliver such documents as they may deem reasonable
or necessary to carry out the Merger and other transactions as
described in the Proxy Statement.
______For
______Against
______Abstain
3. To transact such other business that may properly come before the
Special Meeting or any adjournment thereof.
______For
______Against
______Abstain
<PAGE> 88
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY
WILL BE VOTED FOR THE MERGER.
This Proxy may be revoked at any time before the authority granted
therein is exercised; otherwise, it shall remain in full force and effect.
Proxies may be revoked by filing with the Secretary of the Company written
notice of revocation bearing a later date than the proxy, by duly executing and
delivering to the Secretary of the Company, at or prior to the Special Meeting,
a subsequent proxy relating to the same shares of Stock, or by attending the
Special Meeting and voting in person (although attendance at the Special
Meeting will not, by itself, constitute a revocation of proxy). Any written
notice revoking a proxy should be sent to United Oklahoma Bankshares, Inc.,
4600 S.E. 29th Street, Del City, Oklahoma 73115.
IN WITNESS WHEREOF the undersigned has executed this Proxy on the _____
day of _______, 1997. Number of Shares of Common Stock Signature
- ----------------------------------- -----------------------------------
Number of Shares of Preferred Stock Signature
- ----------------------------------- -----------------------------------
Number of Shares of Preferred Stock Signature if held Jointly
Please sign your name(s) exactly as it appears on your stock
certificate and return this Proxy promptly to save the Company additional
mailing expense. Executors, administrators, trustees, guardians and others
signing in a representative capacity please give their full titles. When
shares are held by joint tenants both should sign. If a corporation, please
sign full corporate name by President or other authorized officer. If a
partnership, please sign in partnership name by authorized person.
<PAGE> 89
EXHIBIT 13(a)
INDEPENDENT AUDITORS' REPORT
UNITED OKLAHOMA BANKSHARES, INC. AND SUBSIDIARIES
The Board of Directors and Stockholders
United Oklahoma Bankshares, Inc.:
We have audited the accompanying consolidated balance sheets of United
Oklahoma Bankshares, Inc. and subsidiaries (the Company) as of December 31,
1996 and 1995, and the related consolidated statements of operations, changes
in stockholders' equity, and cash flows for each of the years in the three-year
period ended December 31, 1996. These consolidated financial statements are the
responsibility of the Company's management. Our responsibility is to express
an opinion on these consolidated financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of United
Oklahoma Bankshares, Inc. and subsidiaries as of December 31, 1996 and 1995, and
the results of their operations and their cash flows for each of the years in
the three-year period ended December 31, 1996, in conformity with generally
accepted accounting principles.
/s/ KPMG PEAT MARWICK LLP
KPMG Peat Marwick LLP
Oklahoma City, Oklahoma
March 18, 1997
30
<PAGE> 90
EXHIBIT 13(b)
INDEPENDENT AUDITORS' REPORT
UNITED OKLAHOMA BANKSHARES, INC. AND SUBSIDIARIES
The Board of Directors and Stockholders
United Oklahoma Bankshares, Inc.:
We have audited the accompanying consolidated balance sheets of United
Oklahoma Bankshares, Inc. and subsidiaries (the Company) as of December 31,
1995 and 1994, and the related consolidated statements of operations, changes
in stockholders' equity and cash flows for each of the years in the three-year
period ended December 31, 1995. These consolidated financial statements are the
responsibility of the Company's management. Our responsibility is to express
an opinion on these consolidated financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of United
Oklahoma Bankshares, Inc. and subsidiaries as of December 31, 1995 and 1994, and
the results of their operations and their cash flows for each of the years in
the three-year period ended December 31, 1995, in conformity with generally
accepted accounting principles.
As discussed in note 1 to the consolidated financial statements, the
Company adopted the provisions of Statements of Financial Accounting Standards
No. 114, "Accounting by Creditors for Impairment of a Loan," as amended by No.
118, "Accounting by Creditors for Impairment of a Loan-Income Recognition and
Disclosures," in 1995, No. 115, "Acocunting for Certain Investments in Debt and
Equity Securities," in 1994 and No. 109, "Accounting for Income Taxes," in
1993.
/s/ KPMG PEAT MARWICK LLP
KPMG Peat Marwick LLP
Oklahoma City, Oklahoma
February 16, 1996
30
<PAGE> 91
EXHIBIT 13(c)
INDEPENDENT AUDITORS' REPORT
UNITED OKLAHOMA BANKSHARES, INC. AND SUBSIDIARIES
The Board of Directors and Stockholders
United Oklahoma Bankshares, Inc.:
We have audited the accompanying consolidated balance sheets of United
Oklahoma Bankshares, Inc. (the Company) and subsidiaries as of December 31,
1994 and 1993, and the related consolidated statements of operations, changes
in stockholders' equity and cash flows for each of the years in the three-year
period ended December 31, 1994. These consolidated financial statements are the
responsibility of the company's management. Our responsibility is to express
an opinion on these consolidated financial statements based on our audits.
We conduct our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of United
Oklahoma Bankshares, Inc. and subsidiaries as of December 31, 1994 and 1993, and
the results of their operations and their cash flows for each of the years in
the three-year period ended December 31, 1994, in conformity with generally
accepted accounting principles.
As discussed in note 1 to the consolidated financial statements, the
Company adopted the provisions of Statements of Financial Accounting Standards
No. 109, "Accounting for Income Taxes," in 1993, and No. 115, "Accounting for
Certain Investments in Debt and Equity Securities," in 1994.
/s/ KPMG PEAT MARWICK LLP
KPMG PEAT MARWICK LLP
Oklahoma City, Oklahoma
February 17, 1995
29
<PAGE> 92
EXHIBIT 13(d)
INDEPENDENT AUDITORS' REPORT
UNITED OKLAHOMA BANKSHARES, INC. AND SUBSIDIARIES
The Board of directors and Stockholders
United Oklahoma Bankshares, Inc.:
We have audited the accompanying consolidated balance sheets of United
Oklahoma Bankshares, Inc. (the Company) and subsidiaries as of December 31,
1993 and 1992, and the related consolidated statements of operations, changes
in stockholders' equity and cash flows for each of the years in the three-year
period ended December 31, 1993. These consolidated financial statements are the
responsibility of the Company's management. Our responsibility is to express
an opinion on these consolidated financial statements based on our audits.
We conduct our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of United
Oklahoma Bankshares, Inc. and subsidiaries as of December 31, 1993 and 1992, and
the results of their operations and their cash flows for each of the years in
the three-year period ended December 31, 1993, in conformity with generally
accepted accounting principles.
As discussed in noted 1 to the consolidated financial statements, the
Company adopted the provisions of Statement of Financial Accounting Standards
No. 109, "Accounting for Income Taxes," in 1993.
/s/ KPMG Peat Marwick LLP
KPMG PEAT MARWICK LLP
Oklahoma City, Oklahoma
February 25, 1994
29
