UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): December 28, 1996
LIBERTY BANCORP, INC.
(Exact name of registrant as specified in its charter)
OKLAHOMA
(State or other jurisdiction of incorporation)
0-12709 73-1218204
(Commission File Number) (IRS Employer
Identification No.)
100 North Broadway
Oklahoma City, Oklahoma 73102
(Address of principal executive offices, including zip code)
Registrant's telephone number, including area code: (405) 231-6000
Not Applicable
(Former name or former address, if changed since last report)
Item 5. Other Events
(a) On December 28, 1996, Banc One Corporation ("Banc One"), Banc One
Oklahoma Corporation ("Banc One Oklahoma") and Liberty Bancorp, Inc. ("LBI")
entered into a Merger Agreement dated December 28, 1996 ("Merger Agreement").
The Merger Agreement provides for the merger of LBI with and into Banc One
Oklahoma, a wholly-owned subsidiary of Banc One, subject to, among other
customary conditions, the affirmative vote of a majority of the shareholders of
LBI and various regulatory approvals.
Pursuant to the Merger Agreement, each share of Common Stock, par value $0.01
per share ("LBI Common Stock"), of LBI would be converted into 1.175 shares of
Common Stock, no par value, of Banc One.
The foregoing description of the Merger Agreement is qualified in its entirety
by reference to the Merger Agreement, which is attached as Exhibit 2 and which
is incorporated herein by reference.
(b) In connection with the Merger Agreement, LBI and Banc One entered
into an Option Agreement dated December 28, 1996 ("Option Agreement"), under
which LBI granted Banc One the right to purchase up to 19.9% of the shares of
LBI Common Stock at a price of $50.25 per share upon the occurrence of certain
events described therein relating generally to the acquisition of LBI by a
third party. The exercise price is equal to the closing price of LBI Common
Stock on December 30, 1996, the date on which the merger was announced to the
general public, as reported by the NASDAQ National Market System.
The foregoing description of the Option Agreement is qualified in its entirety
by reference to the Option Agreement, which is attached as Exhibit 99(a) and
which is incorporated herein by reference.
Item 7. Financial Statements, Pro Forma Financial Statements and Exhibits
The following exhibits are furnished in accordance with Item 601 of
Regulation S-K:
2 Merger Agreement dated December 28, 1996, by and among Banc One
Corporation, Banc One Oklahoma Corporation and Liberty Bancorp, Inc.
99(a) Option Agreement dated December 28, 1996, by and between Banc
One Corporation and Liberty Bancorp, Inc.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its behalf
by the undersigned thereunto duly authorized.
Dated: January 3, 1997
LIBERTY BANCORP, INC.
By: /s/ Mischa Gorkuscha
-----------------------------
Mischa Gorkuscha, Senior Vice
President and Chief Financial Officer
EXHIBIT 2
MERGER AGREEMENT
between
LIBERTY BANCORP, INC.
and
BANC ONE OKLAHOMA CORPORATION
and joined in by
BANC ONE CORPORATION
TABLE OF CONTENTS TO MERGER AGREEMENT
Page
RECITALS
Section 1. Merger
Section 2. Name
Section 3. Business
Section 4. Effective Time of Merger; Certificate of Incorporation
Section 5. Effect of Merger
Section 6. Liabilities upon Merger
Section 7. Conversion of Shares
Section 8. Board of Directors and Employees; Name Changes
Section 9. Stock Options and Employee Benefits
Section 10. Undertakings of the Parties
Section 11. Dissenting Shareholders
Section 12. Tax Opinion
Section 13. Representations and Warranties of BANC ONE
Section 14. Representations and Warranties of BANC ONE OKLAHOMA
Section 15. Representations and Warranties of LIBERTY
Section 16. Action by LIBERTY Pending Effecting Time
Section 17. Action by BANC ONE Pending Effective Time
Section 18. Conditions to Obligations of BANC ONE and
BANC ONE OKLAHOMA
Section 19. Conditions to Obligations of LIBERTY
Section 20. Conditions to Obligations of All Parties
Section 21. Option to Purchase
Section 22. Indemnification
Section 23. Non-Survival of Representations and
Section 24. Governing Law
Section 25. Assignment
Section 26. Satisfaction of Conditions; Termination
Section 27. Waivers;
Section 28. Entire Agreement
Section 29. Captions; Counterparts
Section 30. Notices
SIGNATURES
EXHIBIT A - LIBERTY Subsidiaries List
EXHIBIT B - Form of Undertaking by Affiliates
EXHIBIT C - Opinion of Counsel for LIBERTY
EXHIBIT D - Opinion of Counsel for BANC ONE
and BANC ONE OKLAHOMA
EXHIBIT E - Option Agreement
EXHIBITS TO MERGER AGREEMENT
Exhibit A - LIBERTY Subsidiaries List
Exhibit B - Form of Undertaking by Affiliates
Exhibit C - Opinion of Counsel for LIBERTY
Exhibit D - Opinion of Counsel for BANC ONE and BANC ONE OKLAHOMA
Exhibit E - Option Agreement
MERGER AGREEMENT
MERGER AGREEMENT dated as of December 28, 1996 (hereinafter called the "Merger
Agreement"), between Liberty Bancorp, Inc. (hereinafter called "LIBERTY") and
Banc One Oklahoma Corporation (hereinafter called "BANC ONE OKLAHOMA") and
joined in by BANC ONE CORPORATION (hereinafter called "BANC ONE").
WITNESSETH:
LIBERTY is a corporation duly organized under the laws of the State of
Oklahoma. Its principal office is located at 100 North Broadway, Oklahoma
City, Oklahoma County, Oklahoma. As of September 30, 1996, LIBERTY had
authorized capital stock consisting of 50,000,000 shares of common stock having
a par value of $0.01 per share ("LIBERTY Common"), of which a total of
9,448,538 shares were issued and outstanding and 39,890 of which were shares of
treasury stock owned by LIBERTY. Except as set forth in Exhibit A hereto,
LIBERTY, or a subsidiary of LIBERTY, owns, beneficially and of record, all of
the issued and outstanding capital stock of the banks (the "Banks") and of the
corporations and/or limited liability companies (together, the "Companies")
listed in Exhibit A hereto. The Banks and the Companies are hereinafter
sometimes referred to collectively as "Subsidiaries" and each, sometimes, as a
"Subsidiary."
BANC ONE OKLAHOMA is a corporation duly organized under the laws of the State
of Oklahoma. Its principal office is located at 615 Claussen, P.O. Box 656,
Oklahoma County, Oklahoma. As of the date of this Agreement, BANC ONE OKLAHOMA
had capital stock of $500 divided into 500 shares of common stock having a par
value of one dollar ($1.00) per share ("BANC ONE OKLAHOMA Common"), all of
which are issued and outstanding. BANC ONE OKLAHOMA is a wholly owned
subsidiary of BANC ONE.
BANC ONE is a corporation duly organized under the laws of the State of Ohio.
Its principal office is located at 100 East Broad Street, Columbus, Franklin
County, Ohio. As of September 30, 1996 BANC ONE had capital stock of
$2,399,105,000, divided into 600,000,000 shares of common stock, without par
value ("BANC ONE Common"), 431,805,662 of which shares of BANC ONE Common were
issued and outstanding and 5,622,100 of which were shares of treasury stock
owned by BANC ONE and acquired at a cost of $(205,898,000), and 35,000,000
shares of preferred stock without par value, of which 4,801,546 shares were
issued and outstanding as Series C $3.50 Cumulative Convertible Preferred Stock
("BANC ONE Preferred C") and none of which were shares of treasury stock owned
by BANC ONE.
The respective Boards of Directors of LIBERTY, BANC ONE OKLAHOMA and BANC ONE
have each approved this Merger Agreement and the consummation of the
transactions contemplated hereby and have approved the execution and delivery
of this Merger Agreement. This Merger Agreement provides for the merger of
LIBERTY with and into BANC ONE OKLAHOMA upon the terms and conditions of this
Merger Agreement (the "Merger"). BANC ONE OKLAHOMA will be the surviving
corporation of the Merger. From and after the time the Merger shall become
effective as set forth in Section 4 of this Merger Agreement, and as and when
required by this Merger Agreement, BANC ONE will issue shares of BANC ONE
Common and in exchange for all of the issued and outstanding shares of LIBERTY
Common. It is understood by each of the parties hereto that BANC ONE seeks, as
a result of the Merger, to acquire LIBERTY, the Banks and the Companies and all
of their respective operating assets and liabilities.
Subject to the terms and conditions of this Merger Agreement, all parties will
exert their reasonable best efforts to obtain such regulatory approvals and to
effect such other actions as are necessary or appropriate to consummate the
Merger. In no event will BANC ONE issue more than 12,161,807 Shares of BANC
ONE Common in connection with the transactions contemplated by this Merger
Agreement, except as may be required upon application of Section 7(e) or 26(e)
of this Merger Agreement.
In consideration of the premises, LIBERTY, BANC ONE and BANC ONE OKLAHOMA
hereby make this Merger Agreement and prescribe the terms and conditions of the
Merger and the mode of carrying the Merger into effect as follows:
1. Merger. Subject to the terms and conditions hereinafter set forth in
this Merger Agreement, LIBERTY shall be merged with and into BANC ONE OKLAHOMA
pursuant to and in accordance with applicable provisions of the Oklahoma
General Corporation Act ("Oklahoma GCA").
2. Name. The name of the surviving corporation (hereinafter called the
"Surviving Corporation" whenever reference is made to it as of the Effective
Time or thereafter) shall be "Banc One Oklahoma Corporation."
3. Business. The business of BANC ONE OKLAHOMA as the Surviving
Corporation shall be that of a bank holding company. The Surviving Corporation
shall exist by virtue of, and be governed by, the laws of the State of Oklahoma
and shall have its principal office at 100 North Broadway, Oklahoma City,
Oklahoma.
4. Effective Time of Merger; Certificate of Incorporation. The Merger
shall become effective in accordance with applicable provisions of Section 1081
of the Oklahoma GCA upon the later of (i) the time a certificate of merger,
certified copy of the Merger Agreement or other document or documents effecting
the Merger under the Oklahoma GCA are filed with the Secretary of State of the
State of Oklahoma (the "Oklahoma State Filing") and (ii) that time, if any,
subsequent to the time of the Oklahoma State Filing, designated in the Oklahoma
State Filing as the time the merger shall become effective (the "Effective
Time").
The Certificate of Incorporation of BANC ONE OKLAHOMA in effect as of the
Effective Time shall be the Certificate of Incorporation of the Surviving
Corporation and the By-laws of BANC ONE OKLAHOMA in effect as of the Effective
Time shall be the By-laws of the Surviving Corporation.
5. Effect of Merger. At the Effective Time, the separate corporate
existence of LIBERTY and BANC ONE OKLAHOMA, respectively, shall, as provided in
applicable provisions of the Oklahoma GCA be merged into and continued in BANC
ONE OKLAHOMA as the Surviving Corporation, which shall be deemed to be the same
corporation as LIBERTY and BANC ONE OKLAHOMA. All rights, franchises and
interests of LIBERTY and BANC ONE OKLAHOMA, respectively, in and to every type
of property, real, personal and mixed, and chooses in action, shall be
transferred to and vested in BANC ONE OKLAHOMA as the Surviving Corporation by
virtue of the Merger without any deed or other transfer in the same manner and
to the same extent as such rights, franchises and interests were held or
enjoyed by LIBERTY and BANC ONE OKLAHOMA, respectively, at the Effective Time,
as provided in applicable provisions of the Oklahoma GCA.
6. Liabilities upon Merger. The Surviving Corporation shall be
responsible for all of the liabilities of every kind and description of LIBERTY
and BANC ONE OKLAHOMA existing as of the Effective Time, except as may be
specifically provided otherwise in this Merger Agreement.
7. Conversion of Shares.
(a) At the Effective Time:
(i) Each of the not more than 10,350,474 shares of LIBERTY Common that
shall be issued and outstanding immediately prior to the Effective Time, except
for shares of LIBERTY Common subject to the rights of a dissenting shareholder,
shall thereupon and without further action be converted into 1.175 shares of
BANC ONE Common, subject, however, to (i) the anti-dilution provisions of
Sections 7(e) of this Merger Agreement and (ii) provisions set forth in Section
7(c) herein relative to fractional shares (the "Exchange Rate").
(ii) The 500 shares of BANC ONE OKLAHOMA Common issued and outstanding
immediately prior to the Effective Time shall continue to be issued and
outstanding shares of common stock without par value of the Surviving
Corporation.
(iii) Any shares of LIBERTY Common held by LIBERTY as treasury stock
immediately prior to the Effective Time shall be canceled and shall not
represent capital stock of the Surviving Corporation and shall not be exchanged
for shares of BANC ONE Common.
(b) LIBERTY's shareholders of record at the Effective Time, for the shares
of LIBERTY Common then held by them, respectively, shall be allocated and be
entitled to receive (upon surrender of certificates formerly representing
shares of LIBERTY Common for cancellation) certificates for shares of BANC ONE
Common as shall be equal to (x) the number of shares of LIBERTY Common
outstanding immediately prior to the Effective Time multiplied by (y) the
Exchange Rate.
(c) No certificate for fractional shares of BANC ONE Common will be issued
by BANC ONE in connection with the exchange contemplated by the Merger, but in
lieu thereof, any holder of LIBERTY Common shall, upon surrender of the
certificate or certificates representing such LIBERTY Common, be paid cash,
without interest, by BANC ONE for such fractional shares on the basis of the
average of the closing prices of BANC ONE Common on the New York Stock Exchange
("NYSE") during the Valuation Period (as hereinafter defined) as reported in
The Wall Street Journal for NYSE Composite Transactions for each of the days
included in the Valuation Period.
The term "Valuation Period" shall mean the ten consecutive NYSE trading days
ending on the sixth NYSE trading day immediately prior to the proposed
Effective Time, as designated by BANC ONE pursuant to Section 10(c) of this
Merger Agreement.
(d) As soon as practicable after the Effective Time, holders of
certificates formerly representing shares of LIBERTY shall be instructed to
tender such certificates to BANC ONE pursuant to a letter of transmittal which
shall be delivered to such shareholders by BANC ONE and, subject to the
provisions set forth above relating to fractional shares, BANC ONE, or Harris
Trust & Savings Bank, as Exchange Agent for BANC ONE, will distribute to such
holders of certificates formerly representing shares of LIBERTY Common in
exchange for and upon surrender for cancellation by such holders of a
certificate or certificates formerly representing shares of LIBERTY Common the
certificate(s) for shares of BANC ONE Common in accordance with the Exchange
Rate. Each certificate formerly representing LIBERTY Common (other than
certificates representing shares of LIBERTY Common subject to the rights of
dissenting shareholders) shall be deemed for all purposes to evidence the
ownership of the number of shares of BANC ONE Common and cash for fractional
shares into which such shares have been converted, except, however, and
notwithstanding the foregoing, that, until such surrender of the certificate or
certificates formerly representing shares of LIBERTY Common, the holder thereof
shall not be entitled to receive any dividend or other payment or distribution
payable to holders of BANC ONE Common. Upon such surrender (or, in lieu of
surrender, other provisions reasonably satisfactory to BANC ONE as are made as
set forth in the next following paragraph), there shall be paid to the person
entitled thereto the aggregate amount of dividends or other payments or
distributions (in each case without interest) which became payable after the
Effective Time on the whole shares of BANC ONE Common represented by the
certificates issued upon such surrender and exchange or in accordance with such
other provisions, as the case may be. After the Effective Time, the holders of
certificates formerly representing shares of LIBERTY Common shall cease to have
rights with respect to such shares (except such rights, if any, as they may
have as dissenting shareholders), and except as aforesaid, their sole rights
shall be to exchange said certificates for shares of BANC ONE Common and cash
for fractional shares in accordance with this Merger Agreement.
Certificates formerly representing shares of LIBERTY Common surrendered for
cancellation by each shareholder entitled to exchange shares of LIBERTY Common
for shares of BANC ONE Common by reason of the Merger shall be appropriately
endorsed or accompanied by such appropriate instruments of transfer as BANC ONE
may reasonably require; provided, however, that if there be delivered to BANC
ONE by any person who is unable to produce any such certificate formerly
representing shares of LIBERTY Common for transfer (i) evidence to the
reasonable satisfaction of BANC ONE that any such certificate has been lost,
wrongfully taken or destroyed, and (ii) such security or indemnity as
reasonably may be requested by BANC ONE to save it and Harris Bank & Trust
harmless, and (iii) evidence to the reasonable satisfaction of BANC ONE that
such person is the owner of the shares theretofore represented by each
certificate claimed by him to be lost, wrongfully taken or destroyed and that
he is the person who would be entitled to present each such certificate and to
receive shares of BANC ONE Common pursuant to this Merger Agreement, then BANC
ONE, in the absence of actual notice to it that any shares theretofore
represented by any such certificate have been acquired by a bona fide
purchaser, shall deliver to such person the certificate(s) representing shares
of BANC ONE Common which such person would have been entitled to receive upon
surrender of each such lost, wrongfully taken or destroyed certificate formerly
representing shares of LIBERTY Common.
(e) If prior to the Effective Time BANC ONE or LIBERTY shall declare a
stock dividend or make distributions upon or subdivide, split up, reclassify or
combine its shares of common stock or declare a dividend or make a distribution
on its common stock in any security convertible into or exchangeable for its
common stock, appropriate adjustment or adjustments will be made in the
Exchange Rate.
8. Board of Directors and Employees; Name Changes. The directors of
LIBERTY immediately prior to the Effective Time shall serve as the directors of
the Surviving Corporation immediately following the Effective Time and until
the next annual meeting of shareholders at which their respective successors
are elected and qualified. The officers and employees of the Surviving
Corporation immediately following the Effective Time shall be the officers and
employees of LIBERTY immediately before the Effective Time with each such
person to hold the same office in the Surviving Corporation as held by such
person in LIBERTY. The directors, officers and employees of the Subsidiaries
immediately following the Effective Time shall be the directors, officers and
employees of the respective Subsidiaries immediately before the Effective Time.
LIBERTY will cooperate with BANC ONE in the procurement of requisite corporate
and regulatory approvals and will use its reasonable best efforts to take such
other steps as are appropriate and necessary to effect, when and if requested
by BANC ONE, changes in the name of each of the Subsidiaries to include the
words "BANC ONE BANK" or "BANC ONE" so that such name changes will become
effective at the Effective Time or such later dates as may be designated by
BANC ONE.
9. Stock Options and Employee Benefits.
(a) As of the date of the Merger Agreement, there are outstanding and
unexercised stock options for shares of LIBERTY Common held by directors,
officers and employees of LIBERTY and its Subsidiaries and by Frank X. Henke
and/or his assigns ("Henke"). Immediately following the Effective Time, all
unexercised stock options for shares of LIBERTY Common issued to and held by
directors, officers and employees of LIBERTY and its Subsidiaries and by Henke
immediately prior to the Effective Time shall be assumed by BANC ONE and
converted into options to purchase that number of shares of BANC ONE Common
equal to the number of shares of LIBERTY Common subject to such unexercised
options immediately prior to the Effective Time multiplied by the Exchange
Rate. The per share exercise price of such options for shares of BANC ONE
Common shall be the exercise price applicable to the options for shares of
LIBERTY Common converted into options for BANC ONE shares divided by the
Exchange Rate. Except as set forth herein, all terms and conditions of the
stock option agreements for options for LIBERTY Common shall continue in full
force and effect.
(b) All other employee benefit programs to be available and applicable to
the employees of LIBERTY and the Subsidiaries following the Effective Time
shall be as described in and governed by a Letter Agreement dated December 27,
1996, pertaining to benefits between LIBERTY and BANC ONE (the "Benefits
Agreement").
10. Undertakings of the Parties. LIBERTY, BANC ONE OKLAHOMA and BANC ONE
further agree as follows:
(a) This Merger Agreement shall be submitted to the shareholders of LIBERTY
for approval at a meeting to be called and held in accordance with applicable
law and the Certificate of Incorporation and By-laws of LIBERTY. Such
shareholders' meeting will be scheduled to be held approximately 30 days
following the mailing by LIBERTY of its proxy statement to its shareholders,
which mailing will promptly follow the effective date of the registration
statement to be filed by BANC ONE with the Securities and Exchange Commission
(the "SEC") as provided in Section 10(d). LIBERTY and BANC ONE will cooperate
with each other in order to facilitate the preparation, filing and clearance of
the registration statement and the proxy statement under federal and state
securities laws to be used with respect to such shareholders' meeting and the
exchange of shares as contemplated by this Merger Agreement.
(b) BANC ONE will promptly prepare and file an application (believed in
good faith by BANC ONE to be substantially complete in form and substance) with
the Board of Governors of the Federal Reserve System (the "Board") under
appropriate provisions of Section 3 of the Bank Holding Company Act of 1956, as
amended, and, if necessary, to the Oklahoma State Banking Board (the "Oklahoma
Board") for prior approval of the Merger and/or the proposed acquisition of
LIBERTY and/or one or more of the Subsidiaries by BANC ONE. LIBERTY will
furnish BANC ONE such information, appropriate representations and documents as
may be reasonably requested by BANC ONE in connection therewith and will
cooperate with BANC ONE in the procurement of requisite corporate and
regulatory approvals to effect the Merger. BANC ONE will provide LIBERTY and
its counsel with reasonable opportunity to comment on the applications which it
proposes to file in connection with such regulatory approvals and will give due
consideration to any comments of LIBERTY and its counsel before making such
filings. BANC ONE will use its reasonable best efforts to cause such
applications to be approved by the Board and, if required, the Oklahoma Board
and to obtain such other regulatory consents and approvals as may be necessary
to facilitate the Merger, in each case as soon as possible, and will promptly
provide LIBERTY with copies of all such applications together with
correspondence to or from the Board and the Oklahoma Board related thereto.
(c) The Effective Time shall occur, subject to Section 26 of this Merger
Agreement, at such time as shall be designated by BANC ONE which shall be a
date not later than the latter of the first or last Business Day of a month
next following the latter of (A) receipt of all approvals of the Board and the
Oklahoma Board and the expiration of any required waiting periods with respect
thereto and (B) approval of the Merger by the shareholders of LIBERTY;
provided, however, the Effective Time may be such other day as shall be agreed
to by BANC ONE and LIBERTY.
(d) BANC ONE will promptly prepare and file with the SEC and use its
reasonable best efforts to cause to become effective as soon as possible, a
registration statement, including the related prospectus and proxy statement
referred to in Section 10(a) above (the "Proxy Statement"), and any required
amendments thereto or supplements to any prospectus contained therein, relating
to the exchange of BANC ONE Common contemplated by this Merger Agreement. BANC
ONE will provide LIBERTY and its counsel a reasonable opportunity to comment on
such proposed filings and will give due consideration to any comments of
LIBERTY and its counsel before making any such filings. Such registration
statement will not cover resales by any persons who may be considered
"underwriters" under Rule 145(c) of the Securities Act of 1933, as amended (the
"1933 Act"). BANC ONE shall use its reasonable best efforts to have the shares
of BANC ONE Common qualified or exempted from qualification under all
applicable state securities laws as soon as possible. In the event that a stop
order has been issued, or threatened, by the SEC, that suspends or would
suspend the effectiveness of the registration statement, BANC ONE shall use its
reasonable best efforts to promptly remove, or cause not to be issued, any such
stop order.
(e) BANC ONE and/or BANC ONE OKLAHOMA will assume and pay all expenses
incident to the obtaining of the requisite regulatory consents and approvals.
Without limiting the generality of the foregoing, the expenses to be assumed
and paid by BANC ONE shall include (i) all legal and other expenses and taxes
incurred by BANC ONE incident to the consummation of the Merger contemplated by
this Merger Agreement, (ii) all legal and other expenses incurred by BANC ONE
incident to the preparation and filing of the applications to the Board, the
Oklahoma Board and other requests for regulatory consents and approvals with
the appropriate bank regulatory agencies as set forth in or contemplated by
this Merger Agreement and (iii) all legal and other expenses, if any, incurred
in connection with the registration and qualification of BANC ONE Common under
federal and state securities laws. The expenses to be assumed and paid by BANC
ONE and/or BANC ONE OKLAHOMA shall not include any legal, accounting or other
expenses incurred by LIBERTY in the negotiation of the Merger, associated with
the Proxy Statement, the examination or review of documents for its own
benefit, in connection with its own corporate proceedings or with respect to
any investment banker or advisor for services rendered on its behalf, all of
which will be assumed and paid by LIBERTY. BANC ONE will pay the expenses of
reproducing the Proxy Statement.
(f) All information furnished by or on behalf of LIBERTY to BANC ONE
or any of its representatives in connection with this Merger Agreement (whether
before or after the date of this Merger Agreement) will be kept confidential by
BANC ONE in accordance with the terms of that certain agreement dated December
23, 1996 (the "Confidentiality Agreement") between BANC ONE and LIBERTY. All
information furnished by BANC ONE and BANC ONE OKLAHOMA to LIBERTY (whether
before or after the date of this Merger Agreement) and the transactions
contemplated hereby which is regarded by BANC ONE as confidential (and is so
designated not later than the time of delivery or the date of this Merger
Agreement) will be kept confidential by LIBERTY and will be used by LIBERTY and
its directors, officers, employees and representatives of its advisors only in
connection with this Merger Agreement and the transactions contemplated hereby,
except to the extent that such information (i) is already known to LIBERTY when
received, (ii) thereafter becomes lawfully obtainable from other sources,
otherwise than in violation of this paragraph or similar duties or provisions
regarding confidentiality, or (iii) is, in the reasonable opinion of legal
counsel for LIBERTY, required to be disclosed in any document filed with the
SEC, the Board, the Oklahoma Board or any other governmental agency or
authority.
(g) BANC ONE will provide LIBERTY with copies of all filings made by BANC
ONE with the SEC under the Securities Exchange Act of 1934, as amended (the
"1934 Act"), and the 1933 Act and the respective rules and regulations of the
SEC thereunder at the time such filings are made at any time prior to the
Effective Time.
(h) BANC ONE and BANC ONE OKLAHOMA will furnish to LIBERTY all information
concerning BANC ONE and BANC ONE OKLAHOMA reasonably required by LIBERTY in
connection with the preparation of proxy solicitation materials for use in
soliciting proxies in connection with the meeting of LIBERTY's shareholders
called for the purpose of voting on the Merger and will promptly advise LIBERTY
if BANC ONE determines that any of such information is or becomes false or
misleading in any material respect. LIBERTY will furnish to BANC ONE all
information concerning LIBERTY and the Subsidiaries reasonably required by BANC
ONE in connection with BANC ONE's preparation of the registration statement
(including the related prospectus) and any required amendments or supplements
thereto, or in connection with other filings by BANC ONE relating to the
registration of its shares and will promptly advise BANC ONE if LIBERTY
determines that any such information is or becomes false or misleading in any
material respect.
(i) No press release or other public disclosure of matters related to this
Merger Agreement or any of the transactions contemplated hereby shall be made
by LIBERTY or BANC ONE unless the other party shall have provided its prior
consent to the form and substance thereof; provided, however, that nothing
herein shall be deemed to prohibit any party hereto from making any disclosure
which its counsel deems necessary or advisable in order to fulfill such party's
disclosure obligations imposed by law.
(j) Prior to the Effective Time, BANC ONE will vote all the shares of BANC
ONE OKLAHOMA to approve and adopt the proposal to merge LIBERTY with BANC ONE
OKLAHOMA at a meeting of the shareholders of BANC ONE OKLAHOMA held for such
purpose or by means of a unanimous written consent of BANC ONE OKLAHOMA
shareholders adopted in lieu of a meeting to approve the Merger and approve
this Merger Agreement.
(k) For not less than the three-year period immediately following the
Effective Time, BANC ONE shall make available adequate current public
information about itself as that terminology is used in and as required by Rule
144(c) of the SEC under the 1933 Act.
(l) LIBERTY will use its reasonable best efforts to cause each person who,
in the joint opinion of counsel for BANC ONE and LIBERTY, is at the Effective
Time or was, at the time of LIBERTY's shareholders' meeting referred to in
Section 10 hereof, an "affiliate" of LIBERTY (as that term is used in Rules 144
and 145 promulgated by the SEC under the 1933 Act), to execute and deliver to
BANC ONE the written undertakings in the form attached hereto as Exhibit B.
(m) BANC ONE will initiate a pre-acquisition investigation and review of
the books, credit files, records and facilities of LIBERTY and its Subsidiaries
and will complete such pre-acquisition investigation as soon as reasonably
possible but, in no event, within not more than 60 days following the date of
this Merger Agreement. BANC ONE shall advise LIBERTY at the conclusion of such
pre-acquisition investigation of all matters then known to BANC ONE which BANC
ONE shall in good faith determine to be either (i) inconsistent in any material
and adverse respect with any of the representations and warranties of LIBERTY
contained in this Merger Agreement or (ii), in the reasonable judgment of the
Board of Directors of BANC ONE, to be either (x) of such significance as to
materially and adversely affect the financial condition or the results of
operations of LIBERTY and the Subsidiaries on a consolidated basis or (y)
deviate materially and adversely from LIBERTY's financial statements for the
nine months ended September 30, 1996. BANC ONE shall have the right to
terminate this Merger Agreement as set forth in Section 26(c).
(n) LIBERTY will initiate a pre-acquisition investigation and review of the
books, credit files, records and facilities of BANC ONE and its subsidiaries
and will complete such pre-acquisition investigation as soon as reasonably
possible but, in no event, within not more than 10 business days following the
date of this Merger Agreement. LIBERTY shall advise BANC ONE at the conclusion
of such pre-acquisition investigation of all matters then known to LIBERTY
which LIBERTY shall in good faith determine to be either (i) inconsistent in
any material and adverse respect with any of the representations and warranties
of BANC ONE or BANC ONE OKLAHOMA contained in this Merger Agreement or (ii) in
the reasonable judgment of the Board of Directors of LIBERTY, to be either (x)
of such significance as to materially and adversely affect the financial
condition or the results of operations of BANC ONE and its subsidiaries on a
consolidated basis or (y) deviate materially and adversely from BANC ONE's
financial statements for the nine months ended September 30, 1996. LIBERTY
shall have the right to terminate this Merger Agreement as set forth in Section
26(d).
(o) In addition to BANC ONE's pre-acquisition investigation of LIBERTY and
LIBERTY's pre-acquisition investigation of BANC ONE, BANC ONE and LIBERTY shall
each provide the other with adequate opportunity to conduct such further
reviews and examinations of the business, properties and conditions (financial
and otherwise) of the other as BANC ONE and LIBERTY, respectively, shall deem
prudent, provided that such investigations shall not interfere unreasonably
with the normal operations of the party being reviewed.
(p) BANC ONE will use its reasonable best efforts to cause the shares of
BANC ONE Common to be issued to the shareholders of LIBERTY pursuant to this
Merger Agreement to be listed on the NYSE as of the Effective Time.
(q) Prior to the Effective Time, BANC ONE will file with the SEC and use
its reasonable best efforts to cause to become effective not later than the
Effective Time, a registration statement on Form S-8 or other appropriate form
to register with the SEC the shares of BANC ONE Common which may be issued to
individuals upon the exercise of stock options and/or other stock-related
benefits assumed by BANC ONE pursuant to this Merger Agreement and/or the
Benefits Agreement and will use its reasonable best efforts to cause such
registration statement to remain in effect until the exercise or expiration of
all such options and/or other stock-related benefits. BANC ONE shall use its
reasonable best efforts to have the shares of BANC ONE Common which may be
issued upon the exercise of such options qualified or exempted from
qualification from all applicable state securities laws.
11. Dissenting Shareholders. Shareholders of LIBERTY Common who do not
vote their shares in favor of the Merger and otherwise perfect applicable
dissenters' rights will be entitled to applicable dissenters' or appraisal
rights, if any, under applicable provisions of the Oklahoma GCA.
12. Tax Opinion. BANC ONE and LIBERTY shall use their respective
reasonable best efforts to obtain from Wachtell, Lipton, Rosen & Katz a written
opinion addressed to LIBERTY, its shareholders and BANC ONE, that based upon
the Internal Revenue Code of 1986, as amended (the "Internal Revenue Code"),
the regulations thereunder and rulings issued by the Internal Revenue Service
in transactions similar to those contemplated by this Merger Agreement:
(a) The statutory Merger of LIBERTY with and into BANC ONE OKLAHOMA will
constitute a reorganization within the meaning of Section 368(a)(1)(A) and
Section 368(a)(2)(D) of the Internal Revenue Code;
(b) No gain or loss will be recognized by BANC ONE or LIBERTY as a
consequence of the transactions herein contemplated;
(c) No gain or loss will be recognized by the shareholders of LIBERTY on
the exchange of their shares of LIBERTY Common for shares of BANC ONE Common
(disregarding for this purpose any cash consideration received by such
shareholders of LIBERTY Common, including any cash received pursuant to the
exercise of statutory dissenters' rights or for fractional share interests to
which they may be entitled);
(d) The Federal income tax basis of the BANC ONE Common (including
fractional share interests to which they may be entitled) received by the
shareholders of LIBERTY Common for their shares of LIBERTY Common will be the
same as the Federal income tax basis of the LIBERTY Common surrendered in
exchange therefor; and
(e) The holding period of the BANC ONE Common received by a shareholder of
LIBERTY Common will include the period for which the LIBERTY Common exchanged
therefor was held, provided the exchanged LIBERTY Common was held as a capital
asset by such shareholder on the date of the exchange.
13. Representations and Warranties of BANC ONE. BANC ONE represents and
warrants to LIBERTY that, except as set forth in BANC ONE's disclosure letter
to LIBERTY dated December 27, 1996, and any attachments or schedules annexed
thereto, and delivered to LIBERTY not later than the time of LIBERTY's
execution of this Merger Agreement (the "BANC ONE Disclosure Letter") and
except as otherwise indicated below:
(a) BANC ONE is a corporation duly organized and validly existing in good
standing under the laws of the State of Ohio, is a registered bank holding
company under the Bank Holding Company Act of 1956, as amended, and is
qualified to do business and is in good standing in the State of Ohio, together
with all other jurisdictions where it is both required to so qualify and where
the failure to so qualify would have a BANC ONE Material Adverse Effect, as
hereinafter defined. A BANC ONE Material Adverse Effect is that which has or
would have a material adverse effect on the business, operations, financial
condition or results of operations of BANC ONE and its subsidiaries, taken as a
whole, or on the ability of BANC ONE or BANC ONE OKLAHOMA to consummate the
transactions contemplated hereby. BANC ONE has full power and authority
(including all licenses, franchises, permits and other governmental
authorizations which are legally required) to engage in the businesses and
activities now conducted by it and its subsidiaries. BANC ONE is not subject
to any formal or informal agreement or understanding with, nor is it subject to
any order of, any bank regulatory authority restricting or prohibiting or
attempting to restrict or prohibit any activities or conduct of BANC ONE.
Subject only to obtaining the required regulatory approvals, BANC ONE is, and
at all times after the date of this Merger Agreement to and including the
Effective Time will be, authorized to effect the Merger under applicable law.
As of September 30, 1996 BANC ONE had capital stock of $2,399,105,000, divided
into 600,000,000 shares of BANC ONE Common, 431,805,662 of which shares of BANC
ONE Common were issued and outstanding and 5,622,100 of which were shares of
treasury stock owned by BANC ONE and acquired at a cost of $(205,898,000), and
35,000,000 shares of preferred stock without par value, of which 4,801,546
shares were issued and outstanding shares of BANC ONE Preferred C and none of
which were shares of treasury stock owned by BANC ONE. All of the issued and
outstanding shares of BANC ONE's capital stock are duly authorized, validly
issued, fully paid, nonassessable and subject to no pre-emptive rights. As of
September 30, 1996, BANC ONE had surplus of $4,465,890,000, retained earnings,
including capital reserves, of $1,793,048,000, net unrealized holding
gains/(losses) available for sale (net of tax) of $(12,754,000), and total
consolidated assets of $98,562,000,000.
(b) BANC ONE has furnished to LIBERTY copies of the following financial
statements relating to BANC ONE and its consolidated subsidiaries: (i) the
audited Consolidated Balance Sheets of BANC ONE as of December 31, 1995 and
1994 and the Consolidated Statements of Income, Shareholders' Equity and Cash
Flows for the years then ended, together with the notes thereto, as audited by
Coopers & Lybrand, independent auditors; and (ii) the unaudited Consolidated
Balance Sheet of BANC ONE as at September 30, 1996 and the unaudited
Consolidated Statements of Income and Shareholders' Equity for the period then
ended, together with the notes thereto. Each of the aforementioned financial
statements present fairly, in accordance with generally accepted accounting
principles (applied on a consistent basis except as disclosed in the footnotes
thereto), the consolidated financial position and results of operations of BANC
ONE as of the dates and for the periods therein set forth. Such financial
statements do not, as of the dates thereof, include any material asset or omit
any material liability, absolute or contingent, or other fact, the inclusion or
omission of which renders such financial statements, in light of the
circumstances under which they were made, misleading in any material respect.
Since September 30, 1996, there has not been any change in the financial
condition, results of operations or business of BANC ONE and its subsidiaries
that has had a BANC ONE Material Adverse Effect. Since September 30, 1996,
BANC ONE has issued approximately 1,284,500 additional shares of BANC ONE
Common.
(c) Since December 31, 1992, BANC ONE and each of its subsidiaries has
filed all reports, registrations and statements, together with any required
amendments thereto, that any of them was required to file with (i) the SEC,
including, but not limited to, all Forms 10-K, Forms 10-Q, Forms 8-K, annual
reports and proxy statements, (ii) the Board, (iii) the Federal Deposit
Insurance Corporation (the "FDIC"), (iv) the Office of the Comptroller of the
Currency (the "OCC") and (v) any applicable state securities or banking
authorities. All such reports and statements filed with any such regulatory
body or authority are collectively referred to in this Merger Agreement as the
"BANC ONE Reports." As of their respective dates, the BANC ONE Reports
complied in all material respects with the respective rules and regulations
promulgated by the SEC, the Board, the FDIC, the OCC and state securities or
banking authorities, and did not contain at the time filed any untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(d) The Board of Directors of BANC ONE has duly authorized the execution
and delivery of this Merger Agreement, approved the Merger as contemplated by
said Merger Agreement and authorized the issuance of the shares of BANC ONE
Common for shares of LIBERTY Common as contemplated herein. The Board of
Directors of BANC ONE OKLAHOMA has duly authorized the execution and delivery
of this Merger Agreement and approved the Merger as contemplated by said Merger
Agreement. No authorization of this Merger Agreement, of the transactions
hereby contemplated or of the issuance of shares as contemplated herein is
required by the shareholders of BANC ONE. BANC ONE and BANC ONE OKLAHOMA have
all requisite power and authority to enter into this Merger Agreement and,
after its vote of the shares of BANC ONE OKLAHOMA in favor of the Merger, BANC
ONE and BANC ONE OKLAHOMA will have the authority to consummate the
transactions contemplated hereby. This Merger Agreement constitutes the valid,
legally binding and enforceable obligation of each of BANC ONE and BANC ONE
OKLAHOMA and this Merger Agreement and the consummation of the Merger have been
duly authorized and approved on behalf of BANC ONE and BANC ONE OKLAHOMA by all
requisite corporate action. Provided the required approvals are obtained from
the Board and the Oklahoma Board, neither the execution and delivery of this
Merger Agreement nor the consummation of the Merger will conflict with, result
in the breach of, constitute a default under or accelerate the performance
provided by the terms of any law, or any rule or regulation of any governmental
agency or authority or any judgment, order or decree of any court, bank
regulatory agency or other governmental agency to which BANC ONE or BANC ONE
OKLAHOMA is subject, any contract, agreement or instrument to which BANC ONE or
BANC ONE OKLAHOMA is a party or by which BANC ONE or BANC ONE OKLAHOMA is bound
or committed, or the Articles of Incorporation or Regulations of BANC ONE or
the Certificate of Incorporation or By-laws of BANC ONE OKLAHOMA, or constitute
an event which with the lapse of time or action by a third party, could, to the
best of the knowledge of BANC ONE and its executive officers, after due
inquiry, result in the default under any of the foregoing or result in the
creation of any lien, charge or encumbrance upon any of the assets or
properties of BANC ONE or BANC ONE OKLAHOMA or upon any of the stock of BANC
ONE or BANC ONE OKLAHOMA or adversely affect the ability of BANC ONE to
consummate the transactions contemplated hereby, except, in the case of
contracts, agreements or instruments, such defaults, conflicts or breaches
which either (i) will be cured or waived prior to the Effective Time or (ii) if
not so cured or waived would not, in the aggregate, have any BANC ONE Material
Adverse Effect.
(e) The reserve for possible loan and lease losses shown on the September
30, 1996 Consolidated Balance Sheet of BANC ONE is adequate in all material
respects under the requirements of generally accepted accounting principles to
provide for possible losses, net of recoveries relating to loans previously
charged off, on loans outstanding (including, without limitation, accrued
interest receivable) as of September 30, 1996.
(f) Except as disclosed in the financial statements referred to in Section
13(b), there is no litigation, action, suit, investigation or proceeding
pending or, to the best of the knowledge of BANC ONE and its executive officers
after due inquiry, overtly threatened against or affecting BANC ONE or its
subsidiaries or involving any of their respective properties or assets, at law
or in equity, before any federal, state, municipal, local or other governmental
authority, which is reasonably likely to be resolved adversely to the interest
of BANC ONE or its subsidiaries and, if so resolved, would have a BANC ONE
Material Adverse Effect or materially impair its ability, or that of BANC ONE
OKLAHOMA, to perform under this Merger Agreement, and to the best of the
knowledge and belief of BANC ONE and its executive officers after due inquiry,
no one has reasonable or valid grounds on which it reasonably can be expected
that anyone will assert or initiate any such litigation, action, suit,
investigation or proceeding against BANC ONE based upon the wrongful action or
inaction of BANC ONE or its subsidiaries or any of their respective officers,
directors or employees.
(g) At the Effective Time and on such subsequent dates when the former
shareholders of LIBERTY surrender their certificates formerly representing
shares of LIBERTY Common for cancellation and exchange, the shares of BANC ONE
Common to be exchanged with former shareholders of LIBERTY will be duly
authorized and validly issued by BANC ONE and BANC ONE OKLAHOMA and will be
fully paid and nonassessable and subject to no pre-emptive rights.
(h) BANC ONE and each of its subsidiaries have good and marketable title to
all their respective assets and properties, whether real or personal, tangible
or intangible, including without limitation the capital stock of its
subsidiaries and all other assets and properties reflected in BANC ONE's
Balance Sheet as of September 30, 1996 or acquired subsequent thereto (except
to the extent that such assets and properties have been disposed of for fair
value in the ordinary course of business since September 30, 1996). Such
assets and properties are subject to no liens, mortgages, security interests,
encumbrances, pledges or charges of any kind, except (i) as noted in said
Balance Sheet or the notes thereto; (ii) statutory liens for taxes not yet
delinquent; (iii) landlord's liens; and (iv) minor defects and irregularities
in title and encumbrances which do not materially impair the use thereof for
the purposes for which they are held; and such liens, mortgages, security
interests, encumbrances and charges do not, in the aggregate, have a BANC ONE
Material Adverse Effect. BANC ONE and its subsidiaries as lessees have the
unqualified right under valid and subsisting leases to occupy, use, possess and
control all property leased by BANC ONE and its subsidiaries. At the Effective
Time all limitations affecting such properties will not, in the aggregate, have
a BANC ONE Material Adverse Effect.
(i) To the best of the knowledge of BANC ONE and its executive officers
after due inquiry, BANC ONE and its subsidiaries have complied with all laws,
regulations and orders applicable to them and to the conduct of their
businesses, including without limitation all statutes, rules and regulations
pertaining to the conduct of banking activities except for violations which,
together with any penalty which results therefrom, have not had and will not
have a BANC ONE Material Adverse Effect. Neither BANC ONE nor any of its
subsidiaries is in default under, and no event has occurred which, to the best
of the knowledge of BANC ONE and its executive officers after due inquiry, is
likely to result in a default under the terms of any judgment, decree, order,
writ, rule or regulation of any governmental authority or court, whether
federal, state or local and whether at law or in equity, in each case where the
default has had or is likely to have a BANC ONE Material Adverse Effect.
(j) BANC ONE and BANC ONE OKLAHOMA have not incurred and will not incur
directly or indirectly any liability for brokerage, finders', agents' or
investment bankers' fees or commissions in connection with this Merger
Agreement or the transactions contemplated hereby.
(k) Each pension, stock bonus or purchase, profit-sharing, retirement,
health and welfare plan maintained by or covering employees of BANC ONE or any
subsidiary of BANC ONE (hereinafter referred to collectively as the "plans")
which purports to be a qualified plan under Section 401(a) of the Internal
Revenue Code is so qualified. All of the plans which constitute employee
benefit or employee welfare benefit plans subject to the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), have been maintained in
compliance in all material respects with the applicable requirements of ERISA.
All material notices, reports and other filings required under applicable law
to be given or made to or with any governmental agency with respect to the
plans have been timely filed or delivered. BANC ONE and its executive
officers, after due inquiry, have no knowledge either of any circumstances
which would adversely affect the qualification of the plans or their compliance
with the applicable requirements of ERISA, would result or have resulted in
liability under Title IV of ERISA or of any "reportable event" (as such term is
defined in Section 4043(b) of ERISA) or any "prohibited transaction" (as such
term is defined in Section 406 of ERISA and Section 4975(c) of the Internal
Revenue Code) which has occurred during the past five years and which could
reasonably be expected to result in any material liability of BANC ONE or any
subsidiary to the Pension Benefit Guaranty Corporation (the "PBGC"), the
Department of Treasury, the Department of Labor or any multiemployer plan.
Those plans which are defined benefit plans within the meaning of ERISA meet
the minimum funding standards set forth in the Internal Revenue Code and ERISA
and the assets of such plans equal or exceed the actual present value of
accrued benefits under such plans determined on the basis of the actuarial
assumptions contained in the plan's most recent actuarial valuation. There are
no pending or threatened claims (other than claims for benefits in the ordinary
course), lawsuits or arbitrations which have been asserted or instituted
against the plans, any fiduciaries thereof with respect to their duties to the
plans or the assets of any of the trusts under any of the plans which could
reasonably be expected to result in any material liability of BANC ONE or any
subsidiary to the PBGC, Department of Treasury, Department of Labor or any
multiemployer plan.
(l) Except where the failure to file would not have a BANC ONE Material
Adverse Effect on BANC ONE and its subsidiaries, BANC ONE and/or its
subsidiaries have duly filed all federal, state, county and local income,
franchise, bank, excise, real and personal property and other tax returns and
reports (including, but not limited to, those relating to social security,
withholding, unemployment insurance, and occupation (sales) and use taxes and
those filed on a consolidated, combined or unitary basis) required to have been
filed by BANC ONE or its subsidiaries up to the date hereof. All of the
foregoing returns are true and correct in all material respects, and BANC ONE
and its subsidiaries have paid or, prior to the Effective Time, will pay all
taxes, interest and penalties shown on such returns or reports as being due or
(except to the extent the same are contested in good faith and, if material,
summarized in the BANC ONE Disclosure Letter) or claimed to be due to any
federal, state, county, local or other taxing authority, and there is, and at
the Effective Time will be, no basis for any additional claim or assessment
which might have a BANC ONE Material Adverse Effect, except for those being
contested in good faith and summarized in the BANC ONE Disclosure Letter. BANC
ONE and its subsidiaries have paid or made adequate provision in its financial
statements or its books and records for all taxes payable in respect of all
periods ending on or before the date hereof. BANC ONE and its subsidiaries
have, and at the Effective Time will have, no liability for any taxes, interest
or penalties of any nature whatsoever, except for those taxes which may have
arisen up to the Effective Time in the ordinary course of business and are
properly accrued on the books of BANC ONE as of the Effective Time or are being
contested in good faith and have, if material, been summarized in the BANC ONE
Disclosure Letter.
(m) BANC ONE has in effect insurance coverage with reputable insurers,
which in respect of amounts, premiums, types and risks insured, constitutes
reasonably adequate coverage against all risks customarily insured against by
bank holding companies comparable in size and operation to BANC ONE.
(n) Neither the Proxy Statement nor the related registration statement nor
any amendment or supplement thereto that is filed with the SEC in connection
with the transactions contemplated hereby (except for any information which has
been or shall be supplied by LIBERTY for inclusion in the Proxy Statement and
registration statement and is so included as so supplied) shall contain (in the
case of information relating to the Proxy Statement, at the time it is mailed
and in the case of information relating to the registration statement at the
time it becomes effective and at the time of LIBERTY's shareholders' meeting)
any untrue statement of a material fact or shall omit to state a material fact
necessary to make the statements contained therein, in light of the
circumstances in which they are made, not misleading. The registration
statement and any amendments or supplements thereto that are filed with the SEC
in connection with the transactions contemplated hereby will comply as to form
in all material respects with the provisions of the 1933 Act and the rules and
regulations promulgated thereunder.
(o) No employee of BANC ONE or any of its subsidiaries is represented, for
purposes of collective bargaining, by a labor organization of any type. BANC
ONE is unaware of any efforts during the past five years to unionize or
organize any employees of BANC ONE or any of its subsidiaries, and no claim
related to such employees under the Fair Labor Standards Act, National Labor
Relations Act, Civil Rights Act of 1964, Walsh-Healy Act, Davis Bacon Act,
Civil Rights Act of 1866, Age Discrimination in Employment Act, Equal Pay Act
of 1963, Executive Order No. 11246, Federal Unemployment Tax Act, Vietnam Era
Veterans Readjustment Act, Occupational Safety and Health Act, or any state or
local employment related law, order, ordinance or regulation, no unfair labor
practice, discrimination or wage-and-hour claim is pending or, to the best of
knowledge of BANC ONE and its executive officers after due inquiry, threatened
against BANC ONE or any of its subsidiaries which claim has had or is
reasonably likely to have a BANC ONE Material Adverse Effect.
(p) To the actual knowledge of BANC ONE and its executive officers: (i)
with respect to any contaminant, pollutant, hazardous substance, hazardous
waste, hazardous pollutant, toxic pollutant, toxic waste or toxic substance
("Contaminant"), there are no material actions, proceedings or investigations
pending or threatened before any federal or state environmental regulatory
body, or before any federal or state court, alleging non-compliance with or
liability in connection with, by BANC ONE or any of its subsidiaries, the
Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C.
[subsection] 9601 et seq. ("CERCLA"), the Resource Conservation and Recovery
Act, 42 U.S.C. [subsection] 6901 et seq. ("RCRA"), the Clean Water Act, 33
U.S.C. [subsection] 1251 et seq. ("CWA"), or the Clean Air Act, 42 U.S.C.
[subsection] 7401 et seq. ("CAA"), as each is amended from time to time, or any
other federal, state, local or municipal statute, ordinance or regulation, or
order, ruling or other decision of any court, administrative agency or other
governmental authority relating to health or safety or environmental protection
(such statutes, ordinances, regulations, orders, rulings and decisions,
together, "Environmental Laws"); (ii) neither BANC ONE nor any of its
subsidiaries is responsible in any material respect under any Environmental Law
for any release by any person at or in the vicinity of real property of any
Contaminant, including without limitation by spilling, leaking, pumping,
pouring, emitting, emptying, discharging, injecting, escaping, leaching,
dumping or disposing of any such Contaminant into the environment (collectively
"Release"); (iii) neither BANC ONE nor any of its subsidiaries is responsible
for any material costs of any response action required by virtue of any Release
of any Contaminant into the environment including, without limitation, costs
arising from investigation, removal or remediation of Contaminants, security
fencing, alternative water supplies, temporary evacuation and housing and other
emergency assistance undertaken by any environmental regulatory body or any
other person; (iv) BANC ONE and its subsidiaries are, in all material respects,
in compliance with all applicable Environmental Laws; and (v) no real property
owned or used by BANC ONE or any of its subsidiaries contains any Contaminant
including, without limitation, any asbestos, PCBs or petroleum products or
byproducts in any form, the presence, location or condition of which (a) is
reasonably likely to require remediation or other corrective action pursuant to
any Environmental Law in any material respect, or (b) otherwise would pose any
significant health or safety risk unless remedial measures were taken.
(q) BANC ONE and/or its subsidiaries (i) have surveyed the facilities where
BANC ONE and its subsidiaries conduct their business including, without
limitation, automatic teller machines (collectively, the "BANC ONE Facilities")
for compliance with the Americans with Disabilities Act and the regulations
issued thereunder (collectively, "ADA"); (ii) have developed plans to remove
architectural barriers including communication barriers that are structural in
nature from existing BANC ONE Facilities (collectively, the "BANC ONE
Barriers") when such removal is "readily achievable," as that term is defined
in ADA; (iii)have finalized action plans for automatic teller machines ("ATMs")
in conformance with the Joint Final Rule of the Architectural and
Transportation Barriers Compliance Board ("ATBCB") and the Department of
Transportation, effective August 16, 1993; (iv) have developed or will develop
schedules for BANC ONE Barrier removal from BANC ONE Facilities in such action
plans so that BANC ONE Barrier removal was complete on January 26, 1992 or will
be completed as soon as practicable thereafter; and (v) have removed all BANC
ONE Barriers in BANC ONE Facilities or will cause all BANC ONE Barriers to be
removed in accordance with such action plans. All "alterations" (as such term
is defined in ADA) to BANC ONE Facilities undertaken after January 26, 1992
comply with ADA and the ATBCB Accessibility Guidelines for Buildings and
Facilities ("ADAAG"). Effective January 26, 1992, all plans and designs for
new construction to be utilized by BANC ONE and its subsidiaries comply with
ADA and ADAAG. To the best of the knowledge of BANC ONE and its executive
officers after due inquiry, no investigations, proceedings, or complaints,
formal or informal, are pending or threatened against BANC ONE and/or its
subsidiaries in connection with BANC ONE Facilities under ADA, ADAAG, or any
other state or federal law concerning accessibility for individuals with
disabilities.
(r) The statements made in the BANC ONE Disclosure Letter and any
attachments thereto shall be deemed to constitute representations and
warranties of BANC ONE under this Merger Agreement to the same extent as if
herein set forth in full. Anything disclosed in the BANC ONE Disclosure Letter
or the attachments thereto shall be considered to have been disclosed for
purposes of all representations, warranties and covenants under this Merger
Agreement.
14. Representations and Warranties of BANC ONE OKLAHOMA. BANC ONE OKLAHOMA
represents and warrants to LIBERTY that, except as set forth in the BANC ONE
Disclosure Letter, and except as otherwise indicated below:
(a) BANC ONE OKLAHOMA is a corporation duly organized and validly existing
in good standing under the laws of the State of Oklahoma and is qualified to do
business and is in good standing in the State of Oklahoma together with all
other jurisdictions where it is both required to so qualify and where the
failure to so qualify would have a BANC ONE Material Adverse Effect and BANC
ONE OKLAHOMA has full power and authority (including all licenses, franchises,
permits and other governmental authorizations which are legally required) to
engage in the businesses and activities now conducted by it. The authorized
capital stock of BANC ONE OKLAHOMA is 500 shares of BANC ONE OKLAHOMA Common,
all of which are issued and outstanding and owned by BANC ONE free and clear of
all liens, security interests or other encumbrances. BANC ONE OKLAHOMA's only
subsidiary is Bank One, Oklahoma.
(b) The Board of Directors of BANC ONE OKLAHOMA has duly authorized
execution of this Merger Agreement and approved the merger with LIBERTY as
contemplated by said Merger Agreement. BANC ONE, the sole shareholder of BANC
ONE OKLAHOMA, will vote all the shares of BANC ONE OKLAHOMA to approve the
Merger and adopt this Merger Agreement. BANC ONE OKLAHOMA has all requisite
power and authority to enter into this Merger Agreement and has the authority
to consummate the transactions contemplated hereby. This Merger Agreement
constitutes the valid and legally binding obligation of BANC ONE OKLAHOMA and
this Merger Agreement and the consummation hereof have been duly authorized and
approved on behalf of BANC ONE OKLAHOMA by all requisite corporate action.
Provided the required approvals are obtained from the Board and the Oklahoma
Board, neither the execution and delivery of this Merger Agreement nor the
consummation of the Merger will conflict with, result in the breach of,
constitute a default under or accelerate the performance provided by the terms
of any law, or any rule or regulation of any governmental agency or authority
or any judgment, order or decree of any court, bank regulatory agency or other
governmental agency to which BANC ONE OKLAHOMA may be subject, any contract,
agreement or instrument to which BANC ONE OKLAHOMA is a party or by which BANC
ONE OKLAHOMA is bound or committed, or the Certificate of Incorporation or
By-laws of BANC ONE OKLAHOMA, or constitute an event which with the lapse of
time or action by a third party, could, to the best of BANC ONE OKLAHOMA's
knowledge, result in the default under any of the foregoing or result in the
creation of any lien, charge or encumbrance upon any of the assets or
properties of BANC ONE OKLAHOMA or adversely affect the ability of BANC ONE to
consummate the transactions contemplated hereby.
15. Representations and Warranties of LIBERTY. LIBERTY represents and
warrants to BANC ONE that, except as shall be set forth in LIBERTY's disclosure
letter dated December 27, 1996, and any attachments or schedules annexed
thereto, and delivered to BANC ONE not later than the time of BANC ONE's
execution of this Merger Agreement (the "LIBERTY Disclosure Letter"), and
except as indicated below:
(a) LIBERTY is a corporation duly organized and validly existing in good
standing under the laws of the State of Oklahoma, is a registered bank holding
company under the Bank Holding Company Act of 1956, as amended, and is
qualified to do business and is in good standing in the State of Oklahoma,
together with all other jurisdictions where it is both required to so qualify
and where the failure to so qualify would have a LIBERTY Material Adverse
Effect, as hereinafter defined. A LIBERTY Material Adverse Effect is that
which has or would have a material adverse effect on the business, operations,
financial condition or results of operations of LIBERTY and the Subsidiaries
taken as a whole, or on the ability of LIBERTY to consummate the transactions
contemplated hereby. LIBERTY and the Subsidiaries each have full power and
authority (including all licenses, franchises, permits and other governmental
authorizations which are legally required) to engage in the businesses and
activities now conducted by it. LIBERTY is not subject to any formal or
informal agreement or understanding with, nor is it subject to any order of,
any bank regulatory authority restricting or prohibiting or attempting to
restrict or prohibit any activities or conduct of LIBERTY. Subject only to
obtaining the required regulatory approvals and the approval of LIBERTY
shareholders, LIBERTY is, and at all times after the date of this Merger
Agreement to and including the Effective Time will be, authorized to effect the
Merger under applicable law. As of September 30, 1996, LIBERTY had authorized
capital stock consisting of 50,000,000 shares of LIBERTY Common, of which a
total of 9,448,538 shares were issued and outstanding and 39,890 of which were
shares of treasury stock owned by LIBERTY. All of the issued and outstanding
shares of LIBERTY Common are duly authorized, validly issued, fully paid,
nonassessable and subject to no pre-emptive rights. There are no outstanding
options, warrants, stock appreciation rights or commitments of any kind related
to LIBERTY's capital stock or the exchange of LIBERTY's capital stock except
for (i) outstanding stock options which have been granted related to the
purchase of not more than 615,705 shares of LIBERTY Common pursuant to the
Liberty Bancorp, Inc. 1990 Stock Option Plan, As Amended (the "LIBERTY Option
Plan"), (ii) outstanding stock options which have been granted related to the
purchase of not more than 289,694 shares of LIBERTY Common pursuant to an
Option to Purchase Common Stock between LIBERTY and Henke (the "Henke Option"),
and (iii) the option to be granted to BANC ONE pursuant to Section 21 of this
Merger Agreement. As of September 30, 1996, LIBERTY had surplus of
$210,184,000, retained earnings, including capital reserves, of $63,898,000,
net unrealized holding gains/(losses) available for sale (net of tax) of
$1,798,000, and total consolidated assets of $2,905,361,000.
(b) LIBERTY has furnished to BANC ONE copies of the following financial
statements relating to LIBERTY and the Subsidiaries on a consolidated basis:
(i) the audited Consolidated Balance Sheet of LIBERTY as of December 31, 1995
and 1994, and the Consolidated Statements of Income, Stockholders' Equity and
Cash Flows for the years then ended, together with the notes thereto, as
audited by Arthur Andersen LLP, Certified Public Accountants; and (ii) the
unaudited Consolidated Balance Sheet of LIBERTY as at September 30, 1996 and
the unaudited Consolidated Statement of Income for the period then ended,
together with the notes thereto. Each of the aforementioned financial
statements presents fairly, in accordance with generally accepted accounting
principles (applied on a consistent basis except as disclosed in the footnotes
thereto), the consolidated financial position and results of operations of
LIBERTY as of the dates and for the periods therein set forth. Such financial
statements do not, as of the dates thereof, include any material asset or omit
any material liability, absolute or contingent, or other fact, the inclusion or
omission of which renders such financial statements, in light of the
circumstances under which they were made, misleading in any material respect.
Since September 30, 1996, there has not been any change in the financial
condition, results of operations or business of LIBERTY and the Subsidiaries
that has had a LIBERTY Material Adverse Effect. Since September 30, 1996,
LIBERTY has issued and acquired shares of LIBERTY Common resulting in 9,445,075
shares of LIBERTY Common being outstanding as of December 27, 1996.
(c) Since December 31, 1992, LIBERTY and each of the Subsidiaries has filed
all reports, registrations and statements, together with any required
amendments thereto, that any of them was required to file with (i) the SEC,
including, but not limited to, all Forms 10-K, Forms 10-Q, Forms 8-K, annual
reports and proxy statements, (ii) the Board, (iii) the FDIC, (iv) OCC and (v)
any applicable state securities or banking authorities. All such reports and
statements filed with any such regulatory body or authority are collectively
referred to in this Merger Agreement as the "LIBERTY Reports." As of their
respective dates, the LIBERTY Reports complied in all material respects with
the respective rules and regulations promulgated by the SEC, the Board, the
FDIC, the OCC and state securities or banking authorities, and did not contain
at the time filed any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading.
(d) The Board of Directors of LIBERTY has duly authorized the execution and
delivery of this Merger Agreement and approved the Merger as contemplated by
the Merger Agreement and, subject to the fiduciary duties of the Board of
Directors, will recommend it to the LIBERTY shareholders for adoption. Subject
to the approval by the shareholders of LIBERTY, this Merger Agreement
constitutes the valid, legally binding and enforceable obligation of LIBERTY
and LIBERTY has all requisite power and authority to enter into this Merger
Agreement and LIBERTY has the authority to consummate the transactions
contemplated hereby so that, provided all such shareholder and regulatory
approvals are obtained, neither the execution and delivery of this Merger
Agreement nor the consummation of the Merger will conflict with, result in the
breach of, constitute a default under or accelerate the performance provided by
the terms of any law, or any rule or regulation of any governmental agency or
authority or any judgment, order or decree of any court, bank regulatory agency
or other governmental agency to which LIBERTY is subject, any contract,
agreement or instrument to which LIBERTY is a party or by which LIBERTY is
bound or committed, or the Certificate of Incorporation or By-Laws of LIBERTY,
or constitute an event which with the lapse of time or action by a third party,
could, to the best of the knowledge of LIBERTY and its executive officers after
due inquiry, result in the default under any of the foregoing or result in the
creation of any lien, charge or encumbrance upon any of the assets or
properties of LIBERTY or upon any of LIBERTY's capital stock; except, in the
case of contracts, agreements or instruments, such defaults, conflicts or
breaches which either (i) will be cured or waived prior to the Effective Time
or (ii) if not so cured or waived would not, in the aggregate, have a LIBERTY
Material Adverse Effect.
(e) The reserve for possible loan and lease losses shown on the September
30, 1996 Consolidated Balance Sheet of LIBERTY is adequate in all material
respects under the requirements of generally accepted accounting principles to
provide for possible losses, net of recoveries relating to loans previously
charged off, on loans outstanding (including, without limitation, accrued
interest receivable) as of September 30, 1996.
(f) Except as disclosed in the financial statements referred to in Section
15(b), there is no litigation, action, suit, investigation or proceeding
pending or, to the best of the knowledge LIBERTY and its executive officers
after due inquiry, overtly threatened, against or affecting LIBERTY or any of
its Subsidiaries or involving any of their respective properties or assets, at
law or in equity, before any federal, state, municipal, local or other
governmental authority which is reasonably likely to be resolved adversely to
the interest of LIBERTY or its Subsidiaries and, if so resolved, would have a
LIBERTY Material Adverse Effect, and to the best of the knowledge and belief of
LIBERTY and its executive officers after due inquiry, no one has reasonable or
valid grounds on which it reasonably can be expected that anyone will assert or
initiate any such litigation, action, suit, investigation or proceeding against
LIBERTY based upon the wrongful action or inaction of LIBERTY or any of its
Subsidiaries or any of their respective officers, directors or employees.
(g) LIBERTY and its Subsidiaries have good and marketable title to all
their respective assets and properties, whether real or personal, tangible or
intangible, including without limitation the capital stock of its Subsidiaries
and all other assets and properties reflected in LIBERTY's Balance Sheet as of
September 30, 1996 or acquired subsequent thereto (except to the extent that
such assets and properties have been disposed of for fair value in the ordinary
course of business since September 30, 1996). Such assets and properties are
subject to no liens, mortgages, security interests, encumbrances, pledges or
charges of any kind, except (i) as reflected in said Balance Sheet or the notes
thereto; (ii) statutory liens for taxes not yet delinquent; (iii) landlord's
liens; and (iv) minor defects and irregularities in title and encumbrances
which do not materially impair the use thereof for the purposes for which they
are held; and such liens, mortgages, security interests, encumbrances and
charges do not, in the aggregate, have a LIBERTY Material Adverse Effect.
LIBERTY and its Subsidiaries as lessee have the unqualified right under valid
and subsisting leases to occupy, use, possess and control all property leased
by LIBERTY and its Subsidiaries. At the Effective Time all limitations
affecting such properties will not, in the aggregate, have a LIBERTY Material
Adverse Effect.
(h) To the best of the knowledge of LIBERTY and its executive officers
after due inquiry, LIBERTY and its Subsidiaries have complied with all laws,
regulations and orders applicable to them and to the conduct of their
businesses, including without limitation, all statutes, rules and regulations
pertaining to the conduct of banking activities except for violations which
together with any penalty which results therefrom have not had and will not
have a LIBERTY Material Adverse Effect. Neither LIBERTY nor any of its
Subsidiaries is in default under, and no event has occurred which, to the best
of the knowledge of LIBERTY and its executive officers after due inquiry, is
likely to result in the default under the terms of any judgment, decree, order,
writ, rule or regulation of any governmental authority or court, whether
federal, state or local and whether at law or in equity, in each case when the
default has had or is likely to have a LIBERTY Material Adverse Effect.
(i) LIBERTY has not incurred and will not incur any liability for
brokerage, finders', agents', or investment bankers' fees or commissions in
connection with this Merger Agreement or the transactions contemplated hereby
except for fees to Morgan Stanley & Co. Incorporated to be determined in
accordance with the terms of that certain engagement letter dated December 12,
1996, which is annexed as an exhibit to the LIBERTY Disclosure Letter.
(j) Except as set forth in the LIBERTY Document List (the "LIBERTY Document
List") attached to the LIBERTY Disclosure Letter, neither LIBERTY nor any of
its Subsidiaries is a party to or bound by any written or oral (i) employment
or consulting contract which is not terminable by LIBERTY or its Subsidiaries
on 60 days or less notice, (ii) employee bonus, deferred compensation, pension,
stock bonus or purchase, profit-sharing, retirement or stock option plan,
(iii) other employee benefit or welfare plan, or (iv) other executory material
agreements as defined by the instructions to Exhibit 10 under Item 601 of SEC
Regulation S-K. All such pension, stock bonus, profit-sharing, retirement,
health and welfare plans set forth in the LIBERTY Document List are hereinafter
referred to collectively as the "Plans." Each of those Plans which purports to
be a qualified plan under Section 401(a) of the Internal Revenue Code is so
qualified and nothing has occurred, to the knowledge of LIBERTY and its
executive officers, whether by action or the failure to act, which could
reasonably be expected to result in the loss of such qualification. All of the
plans which constitute employee pension benefit plans or employee welfare plans
subject to ERISA have been maintained in compliance in all material respects
with ERISA. All material notices, reports and other filings required under
applicable law to be given or made to or with any governmental agency with
respect to the plans have been timely filed or delivered. LIBERTY and its
executive officers, after due inquiry, have no knowledge either of any
circumstances which would adversely affect the qualification of the plans or
their compliance with ERISA, would result or have resulted in liability under
Title IV of ERISA or of any unreported "reportable event" (as such term is
defined in Section 4043(b) of ERISA) or "prohibited transaction" (as such term
is defined in Section 406 of ERISA and Section 4975(c) of the Internal Revenue
Code) which has occurred during the past five years and which could reasonably
be expected to result in any material liability of LIBERTY or any Subsidiary to
the PBGC, the Department of Treasury, the Department of Labor or any
multiemployer plan. Those plans which are defined benefit plans within the
meaning of ERISA meet the minimum funding standards set forth in the Internal
Revenue Code and ERISA and the assets of such plans equal or exceed the actual
present value of accrued benefits under such plans as determined on the basis
of the actuarial assumptions contained in the plan's most recent actuarial
valuation. There are no pending or threatened claims (other than claims for
benefits in the ordinary course and pursuant to domestic relations orders),
lawsuits or arbitrations which have been asserted or instituted against the
plans, any fiduciaries thereof with respect to their duties to the plans or the
assets of any of the trusts under any of the plans which could reasonably be
expected to result in any material liability of LIBERTY or any of its
Subsidiaries to the PBGC, the Department of Treasury, the Department of Labor
or any multiemployer plan.
(k) Except where the failure to file would not have a LIBERTY Material
Adverse Effect on LIBERTY and its Subsidiaries, LIBERTY and/or its Subsidiaries
have duly filed all federal, state, county and local income, franchise, bank,
excise, real and personal property and other tax returns and reports
(including, but not limited to, those relating to social security, withholding,
unemployment insurance, and occupation (sales) and use taxes and those filed on
a consolidated, combined or unitary basis) required to have been filed by
LIBERTY or its Subsidiaries up to the date hereof. LIBERTY has made available
to BANC ONE a copy of its Federal income tax return for the years 1995 and 1994
and agrees to provide a copy of its Federal income tax return for the year 1996
when the same becomes available. All of the foregoing returns are true and
correct in all material respects, and LIBERTY and its Subsidiaries have paid
or, prior to the Effective Time, will pay all taxes, interest and penalties
shown on such returns or reports as being due or (except to the extent the same
are contested in good faith and, if material, summarized in the LIBERTY
Disclosure Letter) claimed to be due to any federal, state, county, local or
other taxing authority, and there is, and at the Effective Time will be, no
basis for any additional claim or assessment which might have a LIBERTY
Material Adverse Effect, except for those being contested in good faith and
summarized in the LIBERTY Disclosure Letter. LIBERTY and its Subsidiaries have
paid or made adequate provision in its financial statements or its books and
records for all taxes payable in respect of all periods ending on or before the
date hereof. LIBERTY and its Subsidiaries have, and at the Effective Time will
have, no liability for any taxes, interest or penalties of any nature
whatsoever, except for those taxes which may have arisen up to the Effective
Time in the ordinary course of business and are properly accrued on the books
of LIBERTY as of the Effective Time or are being contested in good faith and
have, if material, been summarized in the LIBERTY Disclosure Letter.
(l) LIBERTY has in effect insurance coverage with reputable insurers which
in respect of amounts, premiums, types and risks insured, constitutes
reasonably adequate coverage against all risks customarily insured against by
bank holding companies comparable in size and operation to LIBERTY.
(m) LIBERTY has not, since September 30, 1996 to the date hereof, (i) sold
or issued any corporate debt securities or sold, issued, reissued or increased
its shares of its capital stock; (ii) granted any option for the purchase of
capital stock other than with respect to existing stock option plans as
described in the Benefits Agreement; (iii) declared or set aside or paid any
dividend or other distribution in respect of its capital stock, except as
permitted pursuant to Section 16(a) hereof or directly or indirectly,
purchased, redeemed or otherwise acquired any shares of such stock; (iv)
incurred any obligation or liability (absolute or contingent) except
obligations or liabilities incurred in the ordinary course of business, or
mortgaged, pledged or subjected to lien or encumbrance (other than landlord's
liens and statutory liens for taxes not yet delinquent and banking transactions
conducted in the ordinary course of business) on any of its material assets or
properties; (v) discharged or satisfied any material lien or encumbrance or
paid any material obligation or liability (absolute or contingent), other than
liabilities included in LIBERTY's financial statements as of September 30,
1996, liabilities incurred since the date thereof in the ordinary course of
business and liabilities incurred in carrying out the transactions contemplated
by this Merger Agreement; (vi) sold, exchanged or otherwise disposed of any
material capital assets; (vii) made any extraordinary officers' salary increase
or wage increase, entered into any employment contract with any officer or
salaried employee or instituted any employee welfare, bonus, stock option,
profit-sharing, retirement or similar plan or arrangement; (viii) suffered any
damage, destruction or loss, whether or not covered by insurance, that has had
a LIBERTY Material Adverse Effect or waived any rights of value which, in the
aggregate, have had a LIBERTY Material Adverse Effect; (ix) entered or agreed
to enter into any agreement or arrangement granting any preferential right to
purchase any of its material assets, properties or rights or requiring the
consent of any party to the transfer and assignment of any such material
assets, properties or rights; or (x) entered into any other material
transaction (other than in the ordinary course of business) except as expressly
contemplated by this Merger Agreement.
(n) LIBERTY has annexed to the LIBERTY Disclosure Letter a loan schedule
identifying certain loan agreements, notes and borrowing arrangements (the
"LIBERTY Loan Schedule") between its Subsidiaries and borrowers of its
Subsidiaries. Except as specifically noted on the LIBERTY Loan Schedule, no
Subsidiary was, as of November 30, 1996, a party to any written or oral (i)
loan agreement, note or borrowing arrangement, other than credit card loans and
other loans the unpaid balance of which does not exceed $100,000 per loan,
under the terms of which the obligor is over 60 days delinquent in payment of
principal or interest or, to the best of LIBERTY's knowledge, in default of any
other provision as of the dates shown thereon; (ii) loan agreement, note or
borrowing arrangement which has been classified as "substandard," "doubtful,"
"loss," "other loans especially mentioned" or any comparable classifications by
LIBERTY, a Subsidiary or banking regulator; (iii) loan agreement, note, or
borrowing arrangement, including any loan guaranty, with any director,
executive officer or ten percent shareholder of LIBERTY or, to the actual
knowledge of LIBERTY and its executive officers after due inquiry, any person,
corporation or enterprise controlling, controlled by or under common control
with any of the foregoing; or, (iv) to the best of the knowledge of LIBERTY and
its executive officers after due inquiry, loan agreement, note or borrowing
arrangement in violation of any law, regulation or rule of any governmental
authority and which violation could, to the best of the knowledge of LIBERTY
and its executive officers after due inquiry, have a LIBERTY Material Adverse
Effect.
(o) None of the information provided by LIBERTY to BANC ONE for inclusion
in the Proxy Statement or related registration statement or any amendment or
supplement thereto (to the extent so included as so provided) shall contain (in
the case of information relating to the Proxy Statement, at the time it is
mailed and in the case of information relating to the registration statement,
at the time it becomes effective) any untrue statement of a material fact or
shall omit to state a material fact necessary to make the statements contained
therein, in light of the circumstances in which they are made, not misleading.
The Proxy Statement that is filed with the SEC in connection with the meeting
of the shareholders of LIBERTY will comply as to form in all material respects
with the provisions of the Exchange Act and the rules and regulations
promulgated thereunder.
(p) Neither LIBERTY nor any Subsidiary is, as of the date hereof, a party
to any material contract and/or any material credit agreement as obligor,
maker, issuer or guarantor and which contract or agreement contains covenants
which make the acquisition of LIBERTY or any Subsidiary by or merger with
another entity a condition of default or acceleration.
(q) Attached hereto as Exhibit A is LIBERTY's Subsidiaries List which sets
forth the complete legal name of each Subsidiary, a designation of the laws
under which each Subsidiary is incorporated and the activities conducted by
each Subsidiary. Except as set forth in Exhibit A, LIBERTY has no
subsidiaries. Each of the Subsidiaries is a corporation, limited liability
company or similar entity duly organized and validly existing in good standing
under the laws of the United States or the state of its incorporation or
organization and has full power and authority (including all licenses,
franchises, permits and other governmental authorizations which are legally
required) to engage in the businesses and activities now conducted by it and is
duly qualified to do business and is in good standing in all jurisdictions
where the failure to so qualify (together with all such failures) would have a
LIBERTY Material Adverse Effect. Except as may be set forth in Exhibit A,
LIBERTY and/or one or more of its Subsidiaries owns beneficially and of record
all the outstanding shares of capital stock of each Subsidiary, which stock is
fully paid and non-assessable (except as provided in 12 U.S.C. [section] 55 and
similar state laws). Neither LIBERTY nor any of its Subsidiaries is a party to
any partnership or joint venture or owns more than 5% of the equity or voting
interest in any entity or enterprise except as may be set forth and described
in the LIBERTY Disclosure Letter.
(r) No employee of LIBERTY or any of its Subsidiaries is represented, for
purposes of collective bargaining, by a labor organization of any type.
LIBERTY is unaware of any efforts during the past five years to unionize or
organize any employees of LIBERTY or any of its Subsidiaries, and no claim
related to such employees under the Fair Labor Standards Act, National Labor
Relations Act, Civil Rights Act of 1964, Walsh-Healy Act, Davis Bacon Act,
Civil Rights Act of 1866, Age Discrimination in Employment Act, Equal Pay Act
of 1963, Executive Order No. 11246, Federal Unemployment Tax Act, Vietnam Era
Veterans Readjustment Act, Occupational Safety and Health Act, or any state or
local employment related law, order, ordinance or regulation, no unfair labor
practice, discrimination or wage-and-hour claim is pending or, to the best of
the knowledge of LIBERTY and its executive officers after due inquiry,
threatened against LIBERTY or its Subsidiaries, which claim has had or is
reasonably likely to have a LIBERTY Material Adverse Effect.
(s) To the actual knowledge of LIBERTY and its executive officers: (i)
with respect to any Contaminant, there are no material actions, proceedings or
investigations pending or threatened before any federal or state environmental
regulatory body, or before any federal or state court, alleging non-compliance
with or liability in connection with, by LIBERTY or any Subsidiary, CERCLA or
any other Environmental Laws; (ii) neither LIBERTY nor any Subsidiary is
responsible in any material respect under any Environmental Law for any Release
by any person at or in the vicinity of any real property of any Contaminant,
including without limitation by spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping or disposing of
any such Contaminant into the environment; (iii) neither LIBERTY nor any
Subsidiary is responsible for any material costs of any response action
required by virtue of any Release of any Contaminant into the environment
including, without limitation, costs arising from investigation, removal or
remediation of Contaminants, security fencing, alternative water supplies,
temporary evacuation and housing and other emergency assistance undertaken by
any environmental regulatory body or any other person; (iv) LIBERTY and each
Subsidiary is, in all material respects, in compliance with all applicable
Environmental Laws; and (v) no real property owned or used by LIBERTY or any
Subsidiary contains any Contaminant including, without limitation, any
asbestos, PCBs or petroleum products or byproducts in any form, the presence,
location or condition of which (a) is reasonably likely to require remediation
or other corrective action pursuant to any Environmental Law in any material
respect, or (b) otherwise would pose any significant health or safety risk
unless remedial measures were taken.
(t) LIBERTY and/or the Subsidiaries (i) have surveyed the facilities where
LIBERTY and the Subsidiaries conduct their business including, without
limitation, ATMs (collectively, the "LIBERTY Facilities") for compliance with
ADA; (ii) have developed action plans to remove architectural barriers
including communication barriers that are structural in nature from existing
LIBERTY Facilities (collectively, the "LIBERTY Barriers") when such removal is
"readily achievable," as that term is defined in ADA; (iii) have finalized
plans for ATMs in conformance with the Joint Final Rule of the ATBCB and the
Department of Transportation, effective August 16, 1993; (iv) have developed or
will develop schedules for LIBERTY Barrier removal from LIBERTY Facilities in
such action plans so that LIBERTY Barrier removal was complete on January 26,
1992 or will be completed as soon as practicable thereafter; and (v) have
removed all LIBERTY Barriers in LIBERTY Facilities or will cause all LIBERTY
Barriers to be removed in accordance with such action plans. All "alterations"
(as such term is defined in ADA) to LIBERTY Facilities undertaken after January
26, 1992 comply with ADA and the ADAAG. Effective January 26, 1992, all plans
and designs for new construction to be utilized by LIBERTY and the Subsidiaries
comply with ADA and ADAAG. To the best of the knowledge of LIBERTY and its
executive officers after due inquiry, no investigations, proceedings, or
complaints, formal or informal, are pending or threatened against LIBERTY
and/or the Subsidiaries in connection with LIBERTY Facilities under ADA, ADAAG,
or any other state or federal law concerning accessibility for individuals with
disabilities.
(u) The statements made in the LIBERTY Disclosure Letter and any
attachments thereto shall be deemed to constitute representations and
warranties of LIBERTY under this Merger Agreement to the same extent as if
herein set forth in full. Anything disclosed in the LIBERTY Disclosure Letter
or the attachments thereto shall be considered to have been disclosed for
purposes of all representations, warranties and covenants under this Merger
Agreement.
16. Action by LIBERTY Pending Effective Time. LIBERTY agrees that from the
date of this Merger Agreement until the earlier of the Effective Time or the
time that this Merger Agreement is terminated, except as stated in LIBERTY's
Disclosure Letter or except with prior written permission of BANC ONE, which,
in any case covered by Section 16(d) hereof, shall not be unreasonably
withheld:
(a) Beginning with the fourth quarter of 1996 and for each succeeding
calendar quarter thereafter prior to the calendar quarter in which the
Effective Time shall occur, LIBERTY
(i) will not declare or pay any dividends or make any distributions on
shares of LIBERTY Common, except cash dividends of (A) $ 0.25 per share for the
fourth quarter of 1996 and (B) of not more than $0.30 per share for each
quarter subsequent to the fourth quarter of 1996; and
(ii) except as hereinbelow provided, will not declare or pay any dividends
or make any distributions in any amount on LIBERTY Common in the quarter in
which the Effective Time shall occur and in which the shareholders of LIBERTY
Common are entitled to receive regular quarterly dividends on the shares of
BANC ONE Common into which the shares of LIBERTY Common have been converted.
It is the intent of this part (ii) to provide that the holders of LIBERTY
Common will receive either the payment of cash dividends on their shares of
LIBERTY Common or the payment of cash dividends as the holders of shares of
BANC ONE Common received in exchange for the shares of LIBERTY Common for the
calendar quarter during which the Effective Time shall occur, but will not
receive and will not become entitled to receive for the same calendar quarter
both the payment of a cash dividend as shareholders of LIBERTY and the payment
of a cash dividend as the holders of the shares of BANC ONE Common received in
exchange for the shares of LIBERTY Common. In the event that LIBERTY does not
declare and pay cash dividends on its LIBERTY Common in a particular calendar
quarter because of LIBERTY's reasonable expectation that the Effective Time
would occur in said calendar quarter and the Effective Time does not in fact
occur effective in said calendar quarter, then, as a result thereof, LIBERTY
shall be entitled to declare and pay a cash dividend (within the limitations of
this Section 16) on said shares of LIBERTY Common for said calendar quarter as
soon as reasonably practicable.
The declaration of any dividends within the limitations of this paragraph shall
remain within the discretion of the Board of Directors of LIBERTY.
(b) LIBERTY will not issue, sell or grant any warrant, option, phantom
stock option, stock appreciation right or commitment of any kind for or related
to or acquire for value any shares of its capital stock or otherwise effect any
change in connection with its equity capitalization except as related to (i)
the outstanding stock options which have been granted related to the purchase
of not more than 615,705 shares of LIBERTY Common pursuant to the LIBERTY
Option Plans, (ii) the outstanding stock option which has been granted related
to the purchase of not more than 289,694 shares of LIBERTY Common pursuant to
the Henke Option, and (iii) the option to be granted to BANC ONE pursuant to
Section 21 of this Merger Agreement.
(c) Except as otherwise set forth in or contemplated by this Merger
Agreement, LIBERTY will carry on its businesses in substantially the same
manner as heretofore, keep in full force and effect insurance comparable in
amount and scope of coverage to that now maintained by it and use its
reasonable best efforts to maintain and preserve its business organization
intact.
(d) Neither LIBERTY nor any Subsidiary will (i) enter into any new line of
business or incur or agree to incur any obligation or liability except
liabilities and obligations (including corporate debt issuances) incurred in
the ordinary course of business, except as may be directed by any regulatory
agency; (ii) except as may be directed by any regulatory agency, change its or
its Subsidiaries' lending, investment, liability management and other material
banking policies in any material respect; (iii) except in the ordinary course
of business and consistent with prior practice, grant any general or uniform
increase in the rates of pay of employees; (iv) establish any new employee
benefit plan or amend any existing plan (except as required by law) so as to
increase by any significant amount the benefits payable thereunder; (v) incur
or commit to any capital expenditures other than in the ordinary course of
business (which will in no event include the establishment of new branches or
any other facilities or any capital expenditures in excess of $75,000 for any
individual project for any purpose); or (vi) merge into, consolidate with or
permit any other corporation to be merged or consolidated with it or any
Subsidiary or acquire outside of the ordinary course of business part of or all
the assets or stock of any other corporation or person.
(e) LIBERTY will not change its or its Subsidiaries' methods of accounting
in effect at December 31, 1995, except as required by changes in generally
accepted accounting principles as concurred in by Arthur Andersen LLP or change
any of its methods of reporting income and deductions for Federal income tax
purposes from those employed in the preparation of LIBERTY's Federal income tax
returns for the taxable years ending December 31, 1995 and 1994, except as
required by changes in law or regulation.
(f) To the extent permitted by law, LIBERTY will afford BANC ONE, its
officers and other authorized representatives, such access to all books,
records, bank examination reports, tax returns, leases, contracts and documents
of LIBERTY and its Subsidiaries and will furnish to BANC ONE such information
with respect to the assets and business of LIBERTY and its Subsidiaries as BANC
ONE may from time to time reasonably request in connection with this Merger
Agreement and the transactions contemplated hereby.
(g) LIBERTY will promptly advise BANC ONE in writing of all material
corporate actions taken by the directors and shareholders of LIBERTY, furnish
BANC ONE with copies of all monthly and other interim financial statements of
LIBERTY as they become available, and keep BANC ONE fully informed concerning
all trends and developments which in the opinion of LIBERTY may have a LIBERTY
Material Adverse Effect.
(h) LIBERTY, its Subsidiaries and their respective officers, directors and
employees will not contract for or acquire, at the expense of LIBERTY or any of
its Subsidiaries, a policy or policies providing for insurance coverage for
directors, officers and/or employees of LIBERTY and/or its Subsidiaries for any
period subsequent to the Effective Time for events occurring before or after
the Effective Time; provided, however, that LIBERTY may renew, extend or
replace existing policies in the ordinary course consistent with past practices
for periods of not greater than one year.
17. Action by BANC ONE Pending Effective Time. BANC ONE agrees that from
the date of this Agreement until the Effective Time, except with prior written
permission of LIBERTY:
(a) BANC ONE will not adopt or implement any amendment to its Articles of
Incorporation or any plan of consolidation, merger or reorganization which
would affect in any manner the terms and provisions of the shares of BANC ONE
Common or the rights of the holders of such shares or reclassify any of the
BANC ONE Common.
(b) Except as otherwise set forth in or contemplated by this Merger
Agreement, BANC ONE will carry on its businesses in substantially the same
manner as heretofore, keep in full force and effect insurance comparable in
amount and scope of coverage to that now maintained by it and use its
reasonable best efforts to maintain and preserve its business organization
intact.
(c) BANC ONE will not change its methods of accounting in effect at
December 31, 1995, except as required by changes in generally accepted
accounting principles as concurred in with Coopers & Lybrand, its independent
auditors, or change any of its methods of reporting income and deductions for
Federal income tax purposes from those employed in the preparation of the
Federal income tax returns of BANC ONE for the taxable years ending December
31, 1995 and 1994, except as required by changes in law or regulation.
(d) To the extent permitted by law, BANC ONE will afford LIBERTY, its
officers and other authorized representatives, such access to all books,
records, bank examination reports, tax returns, leases, contracts and documents
of BANC ONE and its subsidiaries and will furnish to LIBERTY such information
with respect to the assets, earnings and business of BANC ONE and its
subsidiaries as LIBERTY may from time to time reasonably request in connection
with this Merger Agreement and the transactions contemplated hereby.
(e) BANC ONE will not, and will cause its subsidiaries not to, make or
agree to make any acquisition, or take any other action, that adversely affects
its ability or the ability of BANC ONE OKLAHOMA to consummate the transactions
contemplated by this Merger Agreement.
18. Conditions to Obligations of BANC ONE and BANC ONE OKLAHOMA. The
obligations of BANC ONE and BANC ONE OKLAHOMA to effect the Merger are subject,
unless waived by BANC ONE, to the satisfaction of the following conditions on
or prior to the Effective Time:
(a) There shall not have been any change in the consolidated financial
condition, aggregate net assets, shareholders' equity, business or operating
results of LIBERTY and its Subsidiaries, taken as a whole, from September 30,
1996 to the Effective Time that has had a LIBERTY Material Adverse Effect.
(b) LIBERTY shall not have paid cash dividends from October 1, 1996 to the
Effective Time except as permitted under this Merger Agreement.
(c) All representations by LIBERTY contained in this Merger Agreement shall
be true at, or as of, the Effective Time as though such representations were
made at and as of said date, except for (i) changes contemplated by the Merger
Agreement, (ii) representations as of a specified time other than the Effective
Time, which shall be true at such specified time (provided, however, that the
representation of LIBERTY contained in Section 15(e) shall be true in all
material respects as applied to the Balance Sheet of LIBERTY included in the
most recently available quarterly or annual report to LIBERTY shareholders
and/or LIBERTY's most recently filed report to the SEC on Form 10-Q or Form
10-K prior to the Effective Time and the allowance for possible loan losses
included therein, as though each reference to "September 30, 1996" in such
Section were a reference to the last day of the calendar quarter of such report
or form), and (iii) inaccuracies or breaches which do not, individually or in
the aggregate, have a LIBERTY Material Adverse Effect.
(d) BANC ONE shall have received the opinion of legal counsel for LIBERTY,
dated as of the Effective Time, substantially to the effect set forth in
Exhibit C hereto, together with a copy of the Certificate of Incorporation, as
amended, of LIBERTY certified by the Secretary of State of Oklahoma and
Certificates of Good Standing dated as of a date not more than 20 days prior to
the Effective Time from the Secretary of State of the State of Oklahoma or the
OCC, as appropriate, for each Bank.
(e) LIBERTY shall have fulfilled and satisfied, in all material respects,
all agreements and conditions required by this Merger Agreement to be fulfilled
and satisfied by it at or prior to the Effective Time.
(f) As of the close of the most recent calendar quarter (or if the
Effective Time shall occur within 20 days following the close of a calendar
quarter, then as of the next preceding calendar quarter) cumulative earnings
per share on LIBERTY Common reported by LIBERTY for calendar quarters beginning
with the fourth quarter of 1996 through the quarter in which the Effective
Time shall occur shall be greater than or equal to the amount calculated by
multiplying (x) $0.55 by (y) the number of full calendar quarters which have
passed since September 30, 1996 and for which earnings of LIBERTY Common have
been reported as of such date, times (z) 0.9. After consultation with BANC
ONE, LIBERTY may effect the sales of certain of LIBERTY's securities, which
sales may result in losses. As used in this Section "reported" means reported
on LIBERTY's financial statements prepared in accordance with generally
accepted accounting principles applied on a basis consistent with LIBERTY's
financial statements for the years ended December 31, 1995 and 1994, as
included in LIBERTY's reports to the SEC on Forms 10-K or LIBERTY's annual
reports to shareholders subject to any subsequent adjustments required to be
reported whether or not such adjustments have, as yet, been reported with the
following adjustments, if any, net of related income tax savings and costs,
which were reflected in net income for the relevant period(s) added back into
or deducted from net income for the applicable period: (i) outside legal,
investment banking, accounting and other fees and expenses associated with or
resulting from the Merger, including severance and compensation costs disclosed
in the LIBERTY Disclosure Letter; (ii) gains or losses on sales of assets
outside of the ordinary course of business; (iii) losses on sales of securities
sold after consultation with BANC ONE pursuant to this Section 18(g); (iv) any
other expenses upon which BANC ONE and LIBERTY shall mutually agree; and (v)
the effect of any changes in accounting principles required to be adopted by
LIBERTY by any regulatory authority or under generally accepted accounting
principles.
(g) The total number of shares of LIBERTY Common issued and outstanding
(not including treasury shares held by LIBERTY), including the total number of
shares of LIBERTY Common related to outstanding and unexercised options related
to LIBERTY Common, including options under the LIBERTY Option Plan and the
Henke Option, but not including the option to BANC ONE provided for in Section
21 of this Merger Agreement, shall not be more than 10,350,474 shares.
(h) LIBERTY shall have furnished BANC ONE certificates, signed on its
behalf by its Chairman or President and its Secretary or an Assistant Secretary
and dated as of the Effective Time, certifying as to the form of and adoption
of resolutions of its Board and shareholders approving the Merger Agreement and
the Merger, respectively, and to the effect that the conditions described in
Paragraphs (a), (b), (c), (f), and (g), of this Section 18 have been fully
satisfied.
19. Conditions to Obligations of LIBERTY. The obligations of LIBERTY to
effect the Merger are subject, unless waived by LIBERTY, to the satisfaction on
or prior to the Effective Time of the following conditions:
(a) There shall not have been any change in the consolidated financial
condition, aggregate net assets, shareholders' equity, business, or operating
results of BANC ONE and its subsidiaries, taken as a whole, from September 30,
1996 to the Effective Time that has had a BANC ONE Material Adverse Effect.
(b) All representations by BANC ONE and BANC ONE OKLAHOMA contained in this
Merger Agreement shall be true at, or as of, the Effective Time as though such
representations were made at and as of said date, except for changes (i)
contemplated by this Merger Agreement, (ii) representations as of a specified
time other than the Effective Time, which shall be true in all material
respects at such specified time (provided, however, that the representation of
BANC ONE contained in Section 13(e) shall be true in all material respects as
applied to the Balance Sheet of BANC ONE included in the most recently
available quarterly or annual report to BANC ONE's shareholders and/or BANC
ONE's most recently filed report to the SEC on Form 10-Q or Form 10-K prior to
the Effective Time and the reserve for possible loan and lease losses included
therein, as though each reference to "September 30, 1996" in such Section were
a reference to the last day of the calendar quarter of such report or form),
and (iii) inaccuracies or breaches which do not, individually or in the
aggregate, have a BANC ONE Material Adverse Effect.
(c) LIBERTY shall have received the opinion of counsel for BANC ONE and
BANC ONE OKLAHOMA, (i) on and dated the date on which the registration
statement described in Section 10(d) of this Merger Agreement shall have become
effective as described in Section 20(b) of this Merger Agreement substantially
to the effect of paragraphs numbered 5, 6 and 7 of Exhibit D hereto and (ii) on
and dated as of the Effective Time substantially to the effect set forth in
Exhibit D hereto, together with a copy of the Articles of Incorporation of BANC
ONE certified by the Secretary of State of the State of Ohio and a copy of the
Certificate of Incorporation of BANC ONE OKLAHOMA certified by the Secretary of
State of the State of Oklahoma and, as LIBERTY shall reasonably require,
Certificates of Good Standing of BANC ONE and BANC ONE OKLAHOMA dated as of a
date not more than 20 days prior to the day of the Effective Time from the
Secretary of State of the State of Ohio or Secretary of State of the State of
Oklahoma, as applicable, and copies of the Regulations of BANC ONE and By-laws
of BANC ONE OKLAHOMA
(d) BANC ONE and BANC ONE OKLAHOMA shall have fulfilled and satisfied, in
all material respects, all agreements and conditions required by this Merger
Agreement to be fulfilled and satisfied by it at or prior to the Effective
Time.
(e) As of the close of the most recent calendar quarter (or if the
Effective Time shall occur within 20 days following the close of a calendar
quarter, then as of the close of the next preceding calendar quarter)
cumulative earnings per share of BANC ONE Common reported by BANC ONE for
calendar quarters beginning with the fourth quarter of 1996 through the quarter
in which the Effective Time shall occur shall be greater than or equal to the
amount calculated by multiplying (x) $0.81 by (y) the number of full calendar
quarters which have passed since September 30, 1996 and for which earnings per
share of BANC ONE Common have been reported as of such date, times (z) 0.9. As
used in this Section, "reported" means reported on BANC ONE's financial
statements prepared in accordance with generally accepted accounting principles
applied on a basis consistent with BANC ONE's financial statements for the
years ended December 31, 1995 and 1994, as included in BANC ONE's reports to
the SEC on Forms 10-K or BANC ONE's annual reports to shareholders subject to
any subsequent adjustments required to be reported to the SEC whether or not
such adjustments have, as yet, been reported with the effect of any changes in
accounting principles required to be adopted by BANC ONE by any regulatory
authority or under generally accepted accounting principles, if any, net of
related income tax savings and costs, which were reflected in net income for
the relevant period(s) added back into or deducted from net income for the
relevant period(s).
(f) BANC ONE and BANC ONE OKLAHOMA shall have each furnished LIBERTY a
certificate, signed on its behalf by its Chairman, President, Senior Executive
Vice President or an Executive Vice President and by its Secretary or Assistant
Secretary and dated as of the Effective Time certifying as to the form of and
adoption of the resolution of its Board approving the Merger Agreement and the
Merger, and to the effect that the conditions described in Paragraphs (a), (b),
(d), and (e) of this Section 19 have been fully satisfied as to it.
(g) The shares of BANC ONE Common to be issued to the holders of LIBERTY
Common shall be listed on the NYSE.
(h) LIBERTY shall have received an opinion from Morgan Stanley & Co.
Incorporated , dated as of a date not more than five days prior to the date of
the Proxy Statement, to the effect that, in the opinion of such firm, the
financial consideration to be received by the holders of LIBERTY Common as a
result of the Merger is fair to such holders and such opinion shall not have
been withdrawn prior to the Effective Time.
20. Conditions to Obligations of All Parties. In addition to the
provisions of Sections 18 and 19 hereof, the obligations of BANC ONE and
LIBERTY to effect the Merger shall be subject to the satisfaction of the
following conditions on or prior to the Effective Time:
(a) The parties hereto shall have received all necessary approvals of
governmental agencies and authorities of the transactions contemplated by this
Merger Agreement and each of such approvals shall remain in full force and
effect at the Effective Time. BANC ONE shall notify LIBERTY promptly upon
receipt of all necessary governmental approvals. At the Effective Time, (i) no
party hereto shall be subject to any order, decree or injunction of a court or
governmental agency of competent jurisdiction which enjoins or prohibits the
consummation of the Merger; and (ii) no statute, rule, regulation, order,
injunction or decree shall have been enacted, entered, promulgated or enforced
by any governmental authority which prohibits or makes illegal consummation of
the Merger.
(b) The registration statement required to be filed by BANC ONE pursuant to
Section 10(d) of this Merger Agreement shall have become effective by an order
of the SEC, the shares of BANC ONE Common to be exchanged in the Merger shall
have been qualified or exempted under all applicable state securities laws, and
there shall have been no stop order issued and in effect or threatened by the
SEC that suspends or would suspend the effectiveness of the registration
statement, and no proceeding by the SEC shall have been commenced, pending or
overtly threatened for such purpose and the BANC ONE Common to be issued in the
Merger will be authorized for trading on the NYSE.
(c) This Merger Agreement shall have been duly approved and adopted by the
requisite affirmative vote of the shareholders of LIBERTY and BANC ONE
OKLAHOMA.
(d) Wachtell, Lipton, Rosen & Katz shall have issued its written opinion,
dated as of the date of the Effective Time, satisfactory to LIBERTY and BANC
ONE, respectively, substantially to the effect set forth in clauses (a) through
(e) of Section 12 of this Merger Agreement and there shall exist as of, at or
immediately prior to the Effective Time, no facts or circumstances which would
render such opinion inapplicable in any respect to the transactions to be
consummated hereunder.
(e) The aggregate of (i) the fractional share interests of BANC ONE Common
to be paid in cash pursuant to Section 7(c), and (ii) the shares of BANC ONE
Common to which holders of LIBERTY Common would have been entitled as of the
Effective Time but who, as of the Effective Time, have taken steps to perfect
their rights as dissenting shareholders pursuant to the provisions of
applicable law, shall not be more than 10% of the maximum aggregate number of
shares of BANC ONE Common which could be issued as a result of the Merger.
(f) The registration statement filed by BANC ONE with the SEC registering
the shares of BANC ONE Common reserved for issuance pursuant to the exercise of
options on BANC ONE Common pursuant to the LIBERTY Option Plan shall have
become effective pursuant to rules and regulations of the SEC and shall have
been qualified or exempted under all applicable state securities laws, and
there shall have been no stop order issued and in effect or threatened by the
SEC that suspends or would suspend the effectiveness of such registration and
no proceeding by the SEC shall have been commenced, pending or overtly
threatened for such purpose.
21. Option to Purchase
By not later than December 31, 1996, LIBERTY shall grant to BANC ONE an option
to purchase shares of LIBERTY Common in substantially the form of Exhibit E and
shall execute and deliver to BANC ONE an option agreement in substantially the
form of said Exhibit E.
22. Indemnification.
(a) In the event of any threatened or actual claim, action, suit,
proceeding or investigation, whether formal or informal and whether civil,
administrative or criminal, including, without limitation, any such claim,
action, suit, proceeding or investigation pursuant to which any person who is
now, or has been at any time prior to the date hereof, or who becomes prior to
the Effective Time, a director, officer, employee, fiduciary or agent of
LIBERTY or any of its Subsidiaries (the "Indemnified Parties") is, or is
threatened to be, made a party or a witness, based in whole or in part on, or
arising in whole or in part out of, or pertaining to, this Merger Agreement or
any of the transactions contemplated hereby (a "Merger Related Event"), whether
in any case asserted or arising before or after the Effective Time, the parties
hereto agree to cooperate and use their reasonable best efforts to defend
against and respond to such claim, action, suit, proceedings or investigation.
With respect to any Merger Related Event, and conditioned upon the Merger
becoming effective, BANC ONE shall indemnify, defend and hold harmless, as and
to the fullest extent permitted by applicable law, each Indemnified Party
against any and all losses, claims, damages, liabilities, costs, expenses
(including attorneys' fees and expenses), judgments and fines, and amounts paid
in settlement, in connection with any such threatened or actual claim, action,
suit, proceedings or investigation; provided, however, that BANC ONE shall not
be liable for any settlement effected without its prior written consent (which
consent shall not be unreasonably withheld). In the event of any such
threatened or actual claim, action, suit, proceedings or investigation (whether
asserted or arising before or after the Effective Time), (i) BANC ONE shall pay
expenses (including attorney's fees and expenses) in advance of the final
disposition of any claim, suit, proceedings or investigation to each
Indemnified Party to the fullest extent permitted by applicable law, and (ii)
BANC ONE shall use its reasonable best efforts to vigorously defend any such
matter; provided, however, that BANC ONE's obligations as herein set forth
shall not apply to any losses, claims, damages, liabilities, costs, expenses,
judgments, fines and amounts paid in settlement by any Indemnified Party
involving the fraud, bad faith and/or reckless disregard of such Indemnified
Party or related to any threatened or actual claim, action, suit, proceedings
or investigation brought by BANC ONE against any Indemnified Party. Any
Indemnified Party wishing to claim indemnification and defense under this
Section 22(a) shall, upon the earlier to occur of (A) receiving actual notice
of any such claim, action, suit, proceeding or investigation, (B) otherwise
learning of such claim, action, suit, proceeding or investigation or (C)
receiving other information which would give a reasonably prudent person reason
to believe that such a claim, action, suit, proceeding or investigation had or
might be brought, notify BANC ONE thereof as soon as reasonably practicable
thereafter. BANC ONE's obligations pursuant to this Section 22(a) are
conditioned upon (A) BANC ONE being given the right to control and direct the
investigation, defense and/or settlement of each such matter; provided,
however, that BANC ONE will endeavor to consult with the Indemnified Party and
to take the views of such Indemnified Party into consideration in effecting any
settlement, (B) the Indemnified Party having reasonably cooperated with BANC
ONE in connection therewith, and (C) the BANC ONE being given prompt written
notice of any such claim, action, suit, proceeding or investigation; provided,
however, that the failure to so notify shall not affect the obligations of BANC
ONE unless BANC ONE is prejudiced thereby.
(b) To the extent not prohibited by applicable law, BANC ONE shall insure
that all rights to indemnification and defense and all limitations of liability
existing in favor of the Indemnified Parties as provided in LIBERTY's
Certificate of Incorporation and By-laws or similar governing documents of any
of its Subsidiaries or indemnification agreements, as in effect as of December
1, 1996, or as otherwise provided for or allowed under applicable law as in
effect as of the date hereof or as such law is amended at a time prior to the
Effective Time, with respect to claims or liabilities arising from facts or
events existing or occurring prior to the Effective Time, shall survive the
Merger and shall continue in full force and effect, without any amendment
thereto, for a period of six (6) years from the Effective Time; provided,
however, that all rights to indemnification in respect of any claim asserted or
made within such period shall continue until the final disposition of such
claim.
(c) In connection with any obligation of BANC ONE to indemnify any
Indemnified Party pursuant to Section 22(a) or (b), any determination required
to be made with respect to whether an Indemnified Party's conduct complies with
the standards set forth in Section 22(a), above, or under Oklahoma law and the
Certificate of Incorporation or By-Laws of LIBERTY shall be made by independent
counsel (which shall not be counsel that provides material services to BANC
ONE) selected by BANC ONE and reasonably acceptable to the Indemnified Party;
and provided, further, that, in making such determination, BANC ONE shall have
the burden to demonstrate that the Indemnified Party's conduct failed to comply
with such standard.
(d) From and after the Effective Time, persons who, immediately prior to
the Effective Time, served as the directors, officers and employees of LIBERTY
and its Subsidiaries, who, following the Effective Time, continue as directors,
officers and/or employees of the Surviving Corporation or one of its
subsidiaries, shall have indemnification and defense rights having prospective
application only, except, however, for the indemnification and defense rights
set forth in paragraphs (a), (b) and (c) of this Section 22. These prospective
indemnification and defense rights shall consist of (i) such rights to which
directors, officers and employees are entitled under the provisions of the
Certificate of Incorporation, By-laws or similar governing documents of the
Surviving Corporation and its subsidiaries, as applicable, as in effect from
time to time after the Effective Time, as applicable, and provisions of
applicable law as in effect from time to time after the Effective Time and (ii)
those indemnification and defense rights set forth in agreements, if any,
between BANC ONE and the directors and executive officers of the Surviving
Corporation and its Subsidiaries. Such agreements, if any, which shall be
executed as soon as practicable following the Effective Time, shall provide
certain indemnification and defense rights that are comparable to those
provided to directors, officers and employees of BANC ONE and its subsidiaries
generally, but which rights may be greater or lesser than the indemnification
and defense rights available in clause (i) above.
(e) The obligations of BANC ONE provided under paragraphs (a), (b) and (c)
of this Section 22 are intended to be the joint and several obligations of BANC
ONE and the Surviving Corporation and to benefit, and be enforceable against
BANC ONE and the Surviving Corporation directly by the Indemnified Parties, and
shall be binding on all respective successors and permitted assigns of BANC ONE
and the Surviving Corporation.
(f) In the event BANC ONE or the Surviving Corporation or any of its
successors or assigns (i) consolidates with or merges into any other person and
shall not be the continuing or surviving corporation or entity of such
consolidation or merger, or (ii) transfers or conveys all or substantially all
of its properties and assets to any person, then, and in each such case, proper
provision shall be made so that the successors and assigns of BANC ONE or the
Surviving Corporation, as the case may be, assume the obligations set forth in
this Section 22.
(g) The provisions of this Section 22 are intended for the benefit of, and
shall be enforceable by, each Indemnifed Party and his or her heirs and
representatives. BANC ONE shall pay all reasonable costs, including attorneys'
fees, that may be incurred by any Indemnified Party in successfully enforcing
the indemnity and other obligations provided for in this Section 22. The
rights of each Indemniftied Party hereunder shall be in addition to any other
rights such Indemnified Party may have under applicable law.
23. Non-Survival of Representations and Warranties. The respective
representations and warranties of LIBERTY, BANC ONE and BANC ONE OKLAHOMA
contained in this Merger Agreement shall not survive the Effective Time.
24. Governing Law. This Merger Agreement shall be construed and
interpreted according to the applicable laws of the State of Oklahoma.
25. Assignment. This Merger Agreement and all of the provisions hereof
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns, but neither this Merger Agreement
nor any of the rights, interests, or obligations hereunder shall be assigned by
any of the parties hereto without the prior written consent of the other
parties.
26. Satisfaction of Conditions; Termination.
(a) BANC ONE and BANC ONE OKLAHOMA agree to use their reasonable best
efforts to obtain satisfaction of the conditions of this Merger Agreement
insofar as they relate to BANC ONE and BANC ONE OKLAHOMA, and LIBERTY agrees to
use its reasonable best efforts, subject to the fiduciary duties of the Board
of Directors of LIBERTY, to obtain the satisfaction of the conditions of this
Merger Agreement insofar as they relate to LIBERTY, in each case as soon as
possible.
(b) This Merger Agreement may be terminated at any time prior to the
Effective Time, whether before or after approval of the Merger by the
shareholders of BANC ONE OKLAHOMA or by LIBERTY's shareholders, upon the
occurrence of any of the following by written notice from BANC ONE to LIBERTY
(authorized by the Board of Directors or executive officers of BANC ONE), or by
written notice from LIBERTY to BANC ONE (authorized by the Board of Directors
of LIBERTY), as the case may be:
(i) If any material condition to the obligations of BANC ONE and/or BANC
ONE OKLAHOMA set forth in Section 18 or 20 is not substantially satisfied at
the time or times contemplated thereby and such condition is not waived by BANC
ONE or if any material condition to the obligations of LIBERTY as set forth in
Section 19 or 20 is not substantially satisfied at the time or times
contemplated thereby and such condition is not waived by LIBERTY. Each party's
right to terminate under this Section 26 (b)(i) shall relate only to conditions
to that party's obligations;
(ii) In the event of a material breach by the other of any representation,
warranty, condition or agreement contained in this Merger Agreement that is not
cured within 30 days of the time that written notice of such breach is received
by such other party from the party giving notice; or
(iii) If the Merger shall not have been consummated on or before December
29, 1997.
(c) In the event that BANC ONE's pre-acquisition investigation and review
of LIBERTY as described in Section 10(m) of this Merger Agreement discloses
matters which BANC ONE in good faith believes to be either (i) inconsistent in
any material respect with any of the representations and warranties of LIBERTY
contained in this Merger Agreement or (ii), in the reasonable judgment of the
Board of Directors of BANC ONE, to be either (x) of such significance as to
materially and adversely affect the financial condition or the results of
operations of LIBERTY and its Subsidiaries on a consolidated basis or (y)
deviate materially and adversely from LIBERTY's financial statements for the
nine months ended September 30, 1996, BANC ONE may elect to terminate this
Merger Agreement by giving written notice of termination to LIBERTY within
seven days of the conclusion of such pre-acquisition investigation.
(d) In the event that LIBERTY's pre-acquisition investigation and review of
BANC ONE as described in Section 10(n) of this Merger Agreement discloses
matters which LIBERTY in good faith believes to be either (i) inconsistent in
any material respect with any of the representations and warranties of BANC ONE
contained in this Merger Agreement, or (ii) in the reasonable judgment of the
Board of Directors of LIBERTY, to be either (x) of such significance as to
materially and adversely affect the financial condition or the results of
operations of BANC ONE and its subsidiaries on a consolidated basis or (y)
deviate materially and adversely from BANC ONE's financial statements for the
nine months ended September 30, 1996, LIBERTY may elect to terminate this
Merger Agreement by giving written notice of termination to BANC ONE within
seven days of the conclusion of such pre-acquisition investigation.
(e) By LIBERTY if its Board of Directors so determines by a vote of a
majority of the members of its entire Board, at any time during the ten-day
period commencing two days after the Determination Date, if either (x) both of
the following conditions are satisfied:
(i) the Average Closing price shall be less than $35.90; and
(ii) (A) the number obtained by dividing the Average Closing Price by the
Starting Price (such number being referred to herein as the "BANC ONE Ratio")
shall be less than (B) the number obtained by dividing the Average Index Price
by the Index Price of the Starting Date and subtracting 0.20 from the quotient
in this clause (x) (ii)(B) (such number being referred to herein as the "Index
Ratio"); or
(y) the Average Closing Price shall be less than $33.656; subject, however, to
the following four sentences. If LIBERTY elects to exercise its termination
right pursuant to the immediately preceding sentence, it shall give prompt
written notice to BANC ONE which notice shall specify which of the clauses (x)
or (y) is is applicable (or if both would be applicable, which clause is being
invoked); provided that such notice or election to terminate may be withdrawn
at any time within the aforementioned ten-day period. During the five-day
period commencing with its receipt of such notice, BANC ONE shall have the
option in the case of a failure to satisfy the condition in clause (x), of
adjusting the Exchange Rate to equal the lesser of (i) a number equal to a
quotient (rounded to the nearest one-thousandth), the numerator of which is the
product of $35.90 and the Exchange Rate (as then in effect) and the denominator
of which is the Average Closing Price, and (ii) a number equal to a quotient
(rounded to the nearest one-thousandth), the numerator of which is the Index
Ratio multiplied by the Exchange Rate (as then in effect) and the denominator
of which is the ACQUIRED COMPANY Ratio. During such five-day period, BANC ONE
shall have the option, in the case of a failure to satisfy the condition in
clause (y), to elect to increase the Exchange Rate to equal a number equal to a
quotient (rounded to the nearest one-thousandth), the numerator of which is the
product of $33.656 and the Exchange Rate (as then in effect) and the
denominator of which is the Average Closing Price. If BANC ONE makes an
election contemplated by either of the two preceding sentences within such
five-day period, it shall give prompt written notice to LIBERTY of such
election and the revised Exchange Rate, whereupon no termination shall have
occurred pursuant to this Section 26(e) and this Agreement shall remain in
effect in accordance with its terms (except as the Exchange Rate shall have
been so modified), and any references in this Agreement to "Exchange Rate"
shall thereafter be deemed to refer to the Exchange Ratio as adjusted pursuant
to this Section 26(e).
For purposes of this Section 26(e), the following terms shall have the meanings
indicated:
"Average Closing Price" means the average of the daily last sale prices of BANC
ONE Common stock as reported on the NYSE Composite Transactions reporting
system (as reported in The Wall Street Journal or, if not reported therein, in
another mutually agreed upon authoritative source) for the ten consecutive full
trading days in which such shares are traded on the NYSE ending at the close of
trading on the Determination Date.
"Average Index Price" means the average of the Index Prices for the ten
consecutive full NYSE trading days ending at the close of trading on the
Determination Date.
"Determination Date" means the date on which the approval of the Board required
for consummation of the Merger shall be received.
"Index Group" means the group of each of the 14 bank holding companies listed
below, the common stock of all of which shall be publicly traded and as to
which there shall not have been since the Starting Date and before the
Determination Date, any public announcement of a proposal for such company to
be acquired or for such company to acquire another company or companies in
transactions with a value exceeding 25% of the acquiror's market
capitalization. In the event that the common stock of any such company ceases
to be publicly traded or such an announcement is made, such company will be
removed from the Index Group, and the weights (which have been determined based
on the number of outstanding shares of common stock) redistributed
proportionately for purposes of determining the Index Price.
The 14 bank holding companies and the weights attributed to them are as
follows:
Bank Holding Company Weighting
Citicorp 17.2%
Chase Manhattan Corp. 13.9
BankAmerica Corporation 12.6
Wells Fargo & Company 8.9
First Union Corporation 7.0
First Chicago/NBD Corp. 6.0
Norwest Corporation 5.8
Fleet Financial Group, Inc. 4.7
Bank of New York Company, Inc. 4.7
PNC Bank Corp. 4.5
KeyCorp 4.1
SunTrust Banks, Inc. 3.9
Wachovia Corporation 3.4
Mellon Bank Corporation 3.3
Total 100.0%
"Index Price" on a given date means the weighted average (weighted in
accordance with the factors listed above) of the closing prices on such date of
the companies composing the Index Group.
"Starting Date" means the last full day on which the NYSE was open for trading
prior to the execution of this Agreement.
"Starting Price" shall mean the last sale price per share of BANC ONE Common
Stock on the Starting Date, as reported by the NYSE Composite Transactions
reporting system (as reported in The Wall Street Journal or, if not reported
therein, in another mutually agreed upon authoritative source.)
If any company belonging to the Index Group or BANC ONE declares or effects a
stock dividend, reclassification, recapitalization, split-up, combination,
exchange of shares or similar transaction between the Starting Date and the
Determination Date, the prices for the common stock of such company or BANC ONE
shall be appropriately adjusted for the purposes of applying this Section
26(e).
(f) This Merger Agreement may be terminated and abandoned (whether before
or after approval of the Merger by the shareholders of BANC ONE OKLAHOMA or by
LIBERTY's shareholders) by mutual written consent of LIBERTY, BANC ONE OKLAHOMA
and BANC ONE authorized by the respective Boards of Directors of LIBERTY and
BANC ONE OKLAHOMA and by the Board of Directors or executive officers of BANC
ONE.
(g) In the event of termination of this Merger Agreement (i) caused
otherwise than by a willful breach of this Merger Agreement by any of the
parties hereto or (ii) pursuant to Section 26(c), (d) or (e), (A) this Merger
Agreement shall cease and terminate, the acquisition of LIBERTY as provided
herein shall not be consummated, and none of BANC ONE, BANC ONE OKLAHOMA nor
LIBERTY shall have any liability to any other party under this Merger Agreement
of any nature whatever, except for BANC ONE's obligations related to the
printing of the proxy solicitation materials, including any liability for
damages, and (B) BANC ONE, BANC ONE OKLAHOMA and LIBERTY each shall pay its own
fees and expenses incident to the negotiation, preparation and execution of
this Merger Agreement, the respective shareholders' meetings and actions of the
parties and all other acts incidental to, contemplated by or in pursuance of
the transactions contemplated by this Merger Agreement, including fees and
expenses of their respective counsel, accountants and other experts and
advisors. The duties of the parties with respect to confidential information
as set forth in Section 10(f) shall survive any termination of this Merger
Agreement.
(h) If termination of this Merger Agreement shall be judicially determined
to have been caused by willful breach of this Merger Agreement, then, in
addition to other remedies at law or equity for breach of this Merger
Agreement, the party so found to have willfully breached this Merger Agreement
shall indemnify the other parties for their respective costs, fees and expenses
of their counsel, accountants and other experts and advisors as well as fees
and expenses incident to negotiation, preparation and execution of this Merger
Agreement and related documentation and their shareholders' meetings and
consents.
27. Waivers; Amendments. Any of the provisions of this Merger Agreement
may be waived in writing at any time by the party which is, or the shareholders
of which are, entitled to the benefit thereof, provided, however, such waiver,
if material to LIBERTY or its shareholders, may be made only following due
authorization by the Board of Directors of LIBERTY. This Merger Agreement may
be amended or modified in whole or in part by an agreement in writing executed
in the same manner (but not necessarily by the same persons) as this Merger
Agreement and which makes reference to this Merger Agreement; provided,
however, such amendment or modification may be made only following due
authorization by the respective Boards of Directors of LIBERTY and BANC ONE
OKLAHOMA and by the Board of Directors or the executive officers of BANC ONE;
provided, further, however, that after a favorable vote by the shareholders of
LIBERTY any such action shall be taken by LIBERTY only if, in the opinion of
its Board of Directors, such amendment or modification will not have any
material adverse effect on the benefits intended under this Merger Agreement
for the shareholders of LIBERTY, and will not require resolicitation of any
proxies from such shareholders.
28. Entire Agreement. Subject to the exceptions noted in the next
following sentence, this Merger Agreement supersedes any other agreement,
whether written or oral, that may have been made or entered into by LIBERTY,
BANC ONE OKLAHOMA and/or BANC ONE or by any officer or officers of such parties
relating to the acquisition of the business or the capital stock of LIBERTY
and/or its Subsidiaries by BANC ONE or BANC ONE OKLAHOMA. Except for the BANC
ONE Disclosure Letter and any attachments thereto, the LIBERTY Disclosure
Letter and any attachments thereto, the Confidentiality Agreement, and the
Benefits Agreement, this Merger Agreement and the exhibits hereto constitute
the entire agreement by the parties, and there are no agreements or commitments
except as set forth herein and therein.
29. Captions; Counterparts. The captions in this Merger Agreement are for
convenience only and shall not be considered a part of or affect the
construction or interpretation of any provision of this Merger Agreement. This
Merger Agreement may be executed in several counterparts, each of which shall
constitute one and the same instrument.
30. Notices. All notices and other communications hereunder may be made by
mail, hand-delivery or by courier service. If notices and other communications
are made by nationally recognized overnight courier service for overnight
delivery, such notice shall be deemed to have been given one business day after
being forwarded to such a nationally recognized overnight courier service for
overnight delivery. All notices and other communications hereunder given to
any party shall be communicated to the remaining party to this Merger Agreement
by mail or by hand-delivery in the same manner as herein provided.
(a) If to BANC ONE, to:
BANC ONE CORPORATION
Attention of: Chief Executive Officer
100 East Broad Street
Columbus, Ohio 43271
With a copy to:
BANC ONE CORPORATION
Attention of: Steven A. Bennett
General Counsel
100 East Broad Street
Columbus, Ohio 43271
(b) If to LIBERTY, to:
Liberty Bancorp, Inc.
Attention of: Charles E. Nelson
Chairman and Chief Executive Officer
100 North Broadway
Oklahoma City, Oklahoma 73102
With a copies to:
Wachtell, Lipton, Rosen & Katz
Attention of: Samuel Herlihy
51 West 52nd Street
New York, New York 10019
and to:
Crowe & Dunlevy
Attention of: Michael M. Stewart
1800 Mid-America Tower
20 North Broadway
Oklahoma City, Oklahoma 73102
(c) If to BANC ONE OKLAHOMA, to:
Banc One Oklahoma Corporation
Attention of: William P. Boardman
100 East Broad Street
Columbus, Ohio 43271
IN WITNESS WHEREOF, this Merger Agreement has been executed the day and year
first above written.
BANC ONE CORPORATION
ATTEST:
/s/ Charles F. Andrews By: /s/ Wiliam P. Boardman
- ------------------------ ------------------------
Assistant Secretary William P. Boardman
its Senior Executive Vice President
Liberty Bancorp, Inc.
ATTEST:
/s/ Kenneth Brown By: /s/ Charles E. Nelson
- ------------------------ ------------------------
Secretary Charles E. Nelson
its Chairman of the Board and
Chief Executive Officer
Banc One Oklahoma Corporation
ATTEST:
/s/ Charles F. Andrews By: /s/ Wiliam P. Boardman
- ------------------------ ------------------------
Assistant Secretary William P. Boardman
its Vice President
EXHIBIT A
Subsidiaries
Direct Subsidiaries of Liberty Bancorp, Inc.
Jurisdiction of
Name Incorporation Business
- -------------------------------------------------------------------------------
Liberty Bank and Trust Company of National Bank Bank
Oklahoma City, N.A.
Liberty Bank and Trust Company of National Bank Bank
Tulsa, N.A.
Liberty Real Estate Company Oklahoma Ownership of Bank
Premises
Mid-America Credit Life Assurance Oklahoma Credit Insurance
Company Underwriting
Mid-America Insurance Agency, Inc. Oklahoma Credit Insurance
Agent
Liberty Trust Company Oklahoma State Chartered
Trust Company
Liberty Financial Corporation Delaware Inactive
Liberty Trust Company of Texas Texas Proposed Texas
Trust Company
(In Organization)
Subsidiaries of Liberty Bank and Trust Company of Oklahoma City, N.A.
Jurisdiction of
Name Incorporation Business
- -------------------------------------------------------------------------------
Liberty Mortgage Company Delaware Mortgage Origin-
ation and
Servicing
Liberty Property Management Company Oklahoma Property Management
for Bank Premises
Lexco Petroleum, Inc. Oklahoma Holding Title as
Nominee for DPC
Assets
Subsidiaries of Liberty Mortgage Company
Jurisdiction of
Name Incorporation Business
- -------------------------------------------------------------------------------
Liberty Mortgage Company of New Mexico New Mexico Mortgage Origin-
ation and
Servicing
EXHIBIT B
(FORM OF UNDERTAKING BY AFFILIATES)
UNDERTAKING OF AFFILIATE
__________, 1997
In consideration and anticipation of the receipt by the undersigned of Common
Stock of BANC ONE CORPORATION ("BANC ONE") upon consummation of a proposed
merger (the "Merger") of Liberty Bancorp, Inc. ("LIBERTY") and Banc One
Oklahoma Corporation , a subsidiary of BANC ONE, pursuant to the terms of a
certain Merger Agreement dated as of , 1996, (the "Merger
Agreement"), and in view of the fact that the undersigned has, pursuant to the
Merger Agreement, been identified as a possible "affiliate" of LIBERTY within
the meaning of Rules 144 and 145 ("Rule 144" and "Rule 145," respectively), as
amended, of the General Rules and Regulations under the Securities Act of 1933,
as amended (the "1933 Act"), the undersigned (the "Affiliate") represents and
undertakes as follows:
The Affiliate shall not offer, sell or otherwise dispose of or transfer any of
the shares of the Common Stock of BANC ONE to be received by him upon
consummation of the Merger, including shares of BANC ONE Common Stock acquired
by the Affiliate within the two year period following the Merger as a result of
the Affiliate's exercise of options on BANC ONE Common Stock acquired in
substitution for unexercised options on LIBERTY Common Stock, (the "Shares"),
except the Affiliate may offer, sell or transfer the Shares (1) in a manner and
to the extent permitted by the applicable provisions of Rule 145, (2) pursuant
to an effective registration statement relating to the Shares under the 1933
Act, or (3) in a transaction which, in the opinion of counsel for the Affiliate
or as described in a "no-action" or interpretive letter from the staff of the
Securities and Exchange Commission, in each case reasonably satisfactory in
form and substance to BANC ONE, is exempt from the registration requirements of
the 1933 Act.
BANC ONE's transfer agents may be given appropriate instructions prohibiting
transfer of the Shares unless these provisions are complied with and the
certificate(s) for the Shares may bear a restrictive legend in substantially
the following form:
The shares represented by this certificate have been issued to the registered
holder as a result of a transaction to which Rule 145 under the Securities Act
of 1933, as amended (the "1933 Act") applies. The shares represented by this
certificate may not be sold, transferred or assigned, and the issuer shall not
be required to give effect to any attempted sale, transfer or assignment,
except pursuant to (i) a registration statement then in effect under the 1933
Act, (ii) a transaction permitted by Rule 145 as to which the issuer has
received evidence of compliance with the provisions of said Rule 145 reasonably
satisfactory to it or (iii) a transaction which, in the opinion of counsel for
the Affiliate or as described in a 'no action' or interpretive letter from the
staff of the Securities and Exchange Commission, in each case reasonably
satisfactory in form and substance to the issuer, is exempt from the
registration requirements of the 1933 Act. The restrictions of this paragraph
shall become null and void and this paragraph shall have no effect on and after
, 1999.
The undersigned undertakes to take such action as shall be necessary to cause
the Shares to be received by the undersigned to be registered in a manner that
will allow for the placement of a restrictive legend on the certificate(s)
representing such Shares.
I hereby acknowledge that pursuant to the provisions of Rules 144 and 145
certain other persons or entities related to me are, or may be, subject to the
foregoing restrictions on the resale of BANC ONE Common Stock received by them
pursuant to the Merger, which persons include (i) any of my relatives or my
spouse, or any relative of my spouse, who has the same home as me; (ii) any
trust or estate in which I or any of the persons specified in the preceding
clause collectively own ten percent (10%) or more of the total beneficial
interest, or of which I or any of such persons serve as trustee, executor, or
in any similar capacity; and (iii) any corporation or other organization (other
than BANC ONE or any of its affiliates) in which I or any of the persons
specified above are the beneficial owners, collectively, of ten percent (10%)
or more of the equity interest therein. I hereby further acknowledge that I
have advised any and all of such persons that they are, or may be, subject to
the provisions of said Rules 144 and 145, and I hereby represent that I will
use my reasonable best efforts to ensure that such persons comply with the
provisions of this letter and Rules 144 and 145, as applicable, upon the resale
of any Common Stock of BANC ONE.
IN WITNESS WHEREOF, the Affiliate has made this undertaking as of the day and
year first above written.
(OPINION OF COUNSEL FOR LIBERTY) EXHIBIT C
__________________, 1997
BANC ONE CORPORATION
100 East Broad Street
Columbus, Ohio 43271
Gentlemen:
We are counsel to Liberty Bancorp, Inc., an Oklahoma corporation and a
registered bank holding company ("LIBERTY"), and have acted as counsel for
LIBERTY in connection with the merger (the "Merger") of LIBERTY with and into
Banc One Oklahoma Corporation ("BANC ONE OKLAHOMA"), an Oklahoma corporation
and a wholly owned subsidiary of BANC ONE CORPORATION ("BANC ONE"), pursuant to
which each of the issued and outstanding shares of LIBERTY's Common Stock will
be converted into shares of BANC ONE Common Stock. The Merger is to be
consummated pursuant to the terms of an Merger Agreement dated as of
, 1996 ("Merger Agreement"), between LIBERTY and BANC ONE OKLAHOMA and joined
in by BANC ONE. This opinion is furnished to you pursuant to Section 18(d) of
the Merger Agreement.
Except as otherwise indicated herein, capitalized terms used in this Opinion
Letter are defined in the Merger Agreement or the Legal Opinion Accord (the
"Accord") of the ABA Section of Business Law (1991), respectively. In the
event of any inconsistency between the definition of any such term in the
Merger Agreement and the Accord, the definition set forth in the Accord shall
govern.
This Opinion Letter is governed by, and is to be interpreted in accordance
with, the Accord. As a consequence, it is subject to a number of
qualifications, exceptions, definitions, limitations on coverage, and other
limitations, all as more particularly described in the Accord, and this Opinion
Letter should be read in conjunction therewith.
The law covered by the opinions expressed herein is limited solely to the laws
of the State of Oklahoma and the Federal Laws of the United States generally.
Based upon and subject to the foregoing, we are of the opinion that:
1. The Merger Agreement is enforceable against LIBERTY.
2. Except as set forth in the LIBERTY Disclosure Letter, the execution and
delivery by LIBERTY of, and the performance by LIBERTY of its agreements in,
the Merger Agreement do not (a) violate the Constituent Documents of LIBERTY;
(b) violate applicable provisions of statutory
law or regulation; (c) breach or otherwise violate any existing obligation of
LIBERTY under any Court Orders of which the Opinion Giver has Actual Knowledge;
or (d) breach, or result in a default under, any material obligation of LIBERTY
under a material Other Agreement of which the Opinion Giver has Actual
Knowledge.
3. To the Opinion Giver's Actual Knowledge, there are no actions or
proceedings against LIBERTY or any of its subsidiaries, pending or overtly
threatened in writing, before any court, governmental agency or arbitrator
which seeks to affect the enforceability of the Merger Agreement.
The General Qualifications apply to each of the opinions set forth above.
We are rendering this opinion solely for the benefit of BANC ONE and BANC ONE
OKLAHOMA in connection with the transactions described in the Merger Agreement.
It may not be relied upon by any other person or for any other person, or
quoted or filed with any regulatory agency without our prior approval.
Very truly yours,
________________________
________________________
EXHIBIT D
(OPINION OF COUNSEL FOR BANC ONE CORPORATION AND
BANC ONE OKLAHOMA CORPORATION )
________________________, 1997
Liberty Bancorp, Inc.
100 North Broadway
Oklahoma City, Oklahoma 73102
Attention: Chairman
Gentlemen:
I am counsel for BANC ONE CORPORATION, an Ohio corporation and a registered
bank holding company ("BANC ONE") and Banc One Oklahoma Corporation ("BANC ONE
OKLAHOMA"), an Oklahoma corporation and wholly owned subsidiary of BANC ONE,
and have acted as counsel for BANC ONE and BANC ONE OKLAHOMA in connection with
the merger (the "Merger") of Liberty Bancorp, Inc. ("LIBERTY") with and into
BANC ONE OKLAHOMA, pursuant to which each of the issued and outstanding shares
of LIBERTY Common will be converted into shares of BANC ONE Common. Such
Merger is to be consummated pursuant to the terms of a Merger Agreement dated
as of , 1996 ("Merger Agreement") between LIBERTY and BANC ONE
OKLAHOMA and joined in by BANC ONE. This opinion is furnished to you pursuant
to Section 19(c) of the Merger Agreement.
Except as otherwise indicated herein, capitalized terms used in this Opinion
Letter are defined in the Merger Agreement or the Legal Opinion Accord (the
"Accord") of the ABA Section of Business Law (1991), respectively. In the
event of any inconsistency between the definition of any such term in the
Merger Agreement and the Accord, the definition set forth in the Accord shall
govern.
This Opinion Letter is governed by, and is to be interpreted in accordance
with, the Accord. As a consequence, it is subject to a number of
qualifications, exceptions, definitions, limitations on coverage, and other
limitations, all as more particularly described in the Accord, and this Opinion
Letter should be read in conjunction therewith.
The law covered by the opinions expressed herein is limited solely to the laws
of the State of Ohio and the Federal Laws of the United States generally.
Based upon and subject to the foregoing, I am of the opinion that:
1. The Merger Agreement is enforceable against BANC ONE.
2. The Merger Agreement is enforceable against BANC ONE OKLAHOMA
3. Except as set forth in the BANC ONE Disclosure Letter, the execution and
delivery by BANC ONE and BANC ONE OKLAHOMA of, and the performance by BANC ONE
and BANC ONE OKLAHOMA of their agreements in, the Merger Agreement do not (a)
violate the Constituent Documents of BANC ONE and BANC ONE OKLAHOMA; (b)
violate applicable provisions of statutory law or regulation; (c) breach or
otherwise violate any existing obligation of BANC ONE and BANC ONE OKLAHOMA
under any Court Orders of which the Opinion Giver has Actual Knowledge; or (d)
breach, or result in a default under, any material obligation of BANC ONE or
BANC ONE OKLAHOMA under a material Other Agreement of which the Opinion Giver
has Actual Knowledge.
4. To the best of my actual knowledge, I hereby confirm to you, pursuant to
the requirements of Section 13(f) of the Merger Agreement, that there are no
actions or proceedings against BANC ONE or any of its subsidiaries, pending or
overtly threatened in writing, before any court, governmental agency or
arbitrator which (i) seek to affect the enforceability of the Merger Agreement
or (ii) come within the standard established in the Merger Agreement for
disclosure.
5. I have participated in the preparation of the Registration Statement on
Form S-4 (or other appropriate registration statement form) (No. )
of BANC ONE ("Registration Statement"), and in rendering this opinion have
limited my review of the facts concerning the Registration Statement to
discussions with and inquiry of Directors, officers and employees of BANC ONE,
and Coopers & Lybrand, the independent accountants who examined certain of the
financial statements of BANC ONE included in the Registration Statement, and
based thereon and subject to the General Qualifications, I am of the opinion
that such Registration Statement, and the Prospectus included in the
Registration Statement (except as to financial statements, other financial data
and any information concerning LIBERTY included therein, as to which I express
no opinion) at the time the Registration Statement became effective under the
Securities Act of 1933 (the "1933 Act") complied as to form in all material
respects with the 1933 Act and the rules and regulations of the Securities and
Exchange Commission thereunder.
6. I confirm that the Registration Statement has become effective under the
1933 Act, and to the best of my Actual Knowledge, no stop order suspending the
effectiveness of the Registration Statement has been issued and no proceedings
for that purpose have been instituted or are pending or contemplated under the
1933 Act.
7. I have not checked the accuracy or completeness of, or otherwise
verified, any statement of fact contained in the Registration Statement and
Prospectus. Based on the participation, discussions and inquiries described
above, however, I have no reason to believe that the Registration Statement
(except as to financial statements, other financial data and any information
concerning LIBERTY included therein, as to which no view is expressed) at the
time it became effective and as of the date of this letter contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary in order to make the statements therein not
misleading, or that the Prospectus (except as to financial statements, other
financial data and any information concerning LIBERTY included therein, as to
which no view is expressed) at such times contained any untrue statement of a
material fact or omitted to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were
made, not misleading or that since the effective date of the Registration
Statement, any event has occurred which should have been set forth in an
amendment or supplement to the Registration Statement or the Prospectus which
has not been set forth in such an amendment or supplement.
8. The shares of BANC ONE Common to be issued in the Merger shall, when
issued, (a) be validly issued, fully paid and non-assessable and (b) issued
pursuant to the Registration Statement.
The General Qualifications apply to all of the opinions set forth above.
I am rendering this opinion solely for the benefit of LIBERTY and its
shareholders in connection with the transactions described in the Merger
Agreement. It may not be relied upon by any other person or for any other
person, or quoted or filed with any regulatory agency without my prior
approval.
Very truly yours,
EXHIBIT E
Option Agreement
Option Agreement, dated as of December ___, 1996 (this "Agreement"), by and
between Liberty Bancorp, Inc., a corporation organized under the laws of the
State of Oklahoma ("LIBERTY") and BANC ONE CORPORATION, a corporation organized
under the laws of the State of Ohio ("BANC ONE").
W I T N E S S E T H :
WHEREAS, LIBERTY and Banc One Oklahoma Corporation , an Ohio corporation and a
wholly owned subsidiary of BANC ONE ("BANC ONE OKLAHOMA"), together with BANC
ONE, have executed a Merger Agreement dated as of December , 1996 (the
"Merger Agreement") providing for the merger of LIBERTY with and into BANC ONE
OKLAHOMA, pursuant to which BANC ONE will acquire LIBERTY;
WHEREAS, Section 21 of the Merger Agreement provides that LIBERTY will execute
and deliver an option agreement, substantially in the form of this Agreement,
to BANC ONE prior to the close of business December 31, 1996;
NOW THEREFORE, in consideration of said Merger Agreement and their mutual
promises and obligations, the parties hereto adopt and make this Agreement as
follows:
1. LIBERTY hereby grants to BANC ONE an irrevocable option (the "Option")
to purchase in accordance with the terms of this Option Agreement at the
closing trade price of a share of the Common Stock, of LIBERTY ("LIBERTY
Common"), on December 30, 1996, as reported on the National Association of
Securities Dealers Automated Quotation System National Market System, per share
(the "Per Share Price") in cash up to 1,879,570 authorized but unissued shares
of LIBERTY Common (the "Optioned Shares"). The Option shall expire (such event
being referred to herein as the "Option Termination Event") if not exercised as
permitted under this Agreement prior to the earlier of (i) at the time the
merger of LIBERTY into BANC ONE OKLAHOMA becomes effective as set forth and
defined in Section 4 of the Merger Agreement (the "Effective Time"), (ii) BANC
ONE or LIBERTY receiving written notice from the Board of Governors of the
Federal Reserve System (the "Board") or its staff to the effect that the
exercise of the Option pursuant to the terms of this Agreement is not
consistent with Section 3 of the Bank Holding Company Act of 1956, as amended,
(iii) termination of the Merger Agreement by BANC ONE in accordance with the
provisions of Section 26 of the Merger Agreement if such termination occurs
prior to the occurrence of an Initial Triggering Event (as hereinafter
defined), (iv) the first business day after the five hundred and forty-eighth
calendar day following termination of the Merger Agreement by BANC ONE in
accordance with the provisions of Section 26 thereof, if such termination
follows the occurrence of an Initial Triggering Event, provided that the Option
shall in all events expire not later than 24 months after such Initial
Triggering Event, (v) termination of the Merger Agreement by LIBERTY in
accordance with the provisions of Section 26 thereof, or (vi) termination of
the Merger Agreement by mutual consent of BANC ONE and LIBERTY. If, in the
case of (iv), the Option is otherwise exercisable but cannot be exercised on
such day solely because of any injunction, order or similar restraint issued by
a court of competent jurisdiction, the Option shall expire on the twentieth
business day after such injunction, order or restraint shall have been
dissolved or when such injunction, order or restraint shall have become
permanent and no longer subject to appeal, as the case may be.
2. Provided that (i) no preliminary or permanent injunction or other order
issued by any Federal or state court of competent jurisdiction in the United
States prohibiting the exercise of the Option or the delivery of the Optioned
Shares shall be in effect and (ii) any such exercise shall otherwise be subject
to compliance with applicable law and (iii) BANC ONE is not then in material
breach of the Merger Agreement, BANC ONE may exercise the Option in whole or in
part at any time or from time to time after the occurrence of both an Initial
Triggering Event and a Purchase Event (as defined in Section 4 of this
Agreement) if, but only if, both the Initial Triggering Event and the Purchase
Event shall have occurred prior to the occurrence of an Option Termination
Event. In the event that BANC ONE wishes to exercise the Option, BANC ONE
shall give written notice of such exercise (the date of such notice being
herein called the "Notice Date") within 30 days following such Purchase Event
to LIBERTY specifying the number of Optioned Shares it will purchase pursuant
to such exercise and a place and date for the closing of such purchase which
date shall be within 45 days following the receipt of the last of any required
regulatory approvals, but in any event, within 365 days of the Purchase Event,
subject to reasonable extensions in order for BANC ONE to obtain required
regulatory approvals.
3. At any closing of the exercise of the Option, (i) BANC ONE will make
payment to LIBERTY of the aggregate price for the Optioned Shares in
immediately available funds, in an amount equal to the product of the Per Share
Price multiplied by the number of Optioned Shares being purchased at such
closing and (ii) LIBERTY will deliver to BANC ONE a duly executed certificate
or certificates representing the number of Optioned Shares so purchased,
registered in the name of BANC ONE or its nominee in the denominations
designated by BANC ONE in its notice of exercise. Unless counsel for LIBERTY
and BANC ONE agree that such shares are not "restricted shares" under federal
and/or state securities laws, certificates for such shares shall bear a legend
to that effect.
4. For purposes of this Agreement, an "Initial Triggering Event" shall have
occurred at such time as one of the following events shall have occurred and
BANC ONE shall have determined in good faith (and shall have notified LIBERTY
in writing of such determination) that there is a reasonable likelihood that,
as a result of the occurrence of any of the following events, consummation of
the Merger pursuant to the term of this Merger Agreement is jeopardized: (i)
any person as defined in [subsection] 3(a)(9) or 13(d)(3) of the Securities
Exchange Act of 1934, as amended (the "1934 Act") (other than BANC ONE or any
BANC ONE subsidiary or affiliate) shall have commenced a bona fide offer to
purchase shares of LIBERTY Common such that, upon consummation of said offer,
such person would own or control 10% or more of the outstanding shares of
LIBERTY Common, or shall have entered into an agreement with LIBERTY, or shall
have filed an application or notice with the Board or any other federal or
state regulatory agency for clearance or approval, to (A) merge or consolidate
or enter into any similar transaction, with LIBERTY, (B) purchase, lease or
otherwise acquire all or substantially all of the assets of LIBERTY or (C)
purchase or otherwise acquire (including by way of merger, consolidation, share
exchange or any similar transaction) securities representing 10% or more of the
voting power of LIBERTY; (ii) any person (other than BANC ONE, BANC ONE
OKLAHOMA, any BANC ONE subsidiary or affiliate, any subsidiary of LIBERTY
("LIBERTY Subsidiary") in a fiduciary capacity) or any current shareholder of
LIBERTY which has beneficial ownership of 10% or more of the outstanding shares
of LIBERTY Common (a "Current 10% Shareholder") shall have acquired beneficial
ownership or the right to acquire beneficial ownership of 10% or more of the
outstanding shares of LIBERTY Common (the term "beneficial ownership" for
purposes of this Agreement having the meaning assigned thereto in Section 13(d)
of the 1934 Act) or, in the case of a Current 10% Shareholder, said Current 10%
Shareholder shall have acquired beneficial ownership or the right to acquire
beneficial ownership of 10% or more of the outstanding shares of LIBERTY Common
in addition to those beneficially owned as of the date hereof; (iii) any person
(other than BANC ONE or any BANC ONE subsidiary or affiliate) shall have made a
bona fide proposal to LIBERTY after the date of the Merger Agreement by public
announcement or written communication that is the subject of public disclosure
or regulatory report or filing to (A) acquire LIBERTY by merger, consolidation,
purchase of all or substantially all of its assets or any other similar
transaction, or (B) make an offer described in clause (i), above; (iv) any
person shall have solicited proxies in a proxy solicitation subject to
Regulation 14A under the 1934 Act in opposition to approval of the Merger
Agreement by LIBERTY's shareholders; or (v) or LIBERTY shall have willfully
breached any provision of the Merger Agreement, which breach would entitle BANC
ONE to terminate the Merger Agreement and such breach shall not have been cured
pursuant to the
terms of the Merger Agreement. For purposes of this Agreement, a "Purchase
Event" shall have occurred at such time as (i) any person (other than BANC ONE
or any BANC ONE subsidiary or affiliate) acquires beneficial ownership of 50%
or more of the then-outstanding shares of LIBERTY Common, or (ii) LIBERTY
enters into an agreement with another person (other than BANC ONE or any BANC
ONE subsidiary) pursuant to which such person is entitled to acquire 50% or
more of the then-outstanding shares of LIBERTY Common.
5. If between the date of the Merger Agreement and the Effective Time, the
shares of LIBERTY Common shall be changed into a different number of shares by
reason of any reclassification, recapitalization, split-up, combination or
exchange of shares, or if a stock dividend thereon shall be declared with a
record date within said period (an "Event"), the number of Optioned Shares and
the Per Share Price shall be adjusted appropriately so as to restore BANC ONE
to its rights hereunder, including, without limitation, its right to purchase
that number of additional shares (the "Additional Optioned Shares")
representing ownership of the voting power of the capital stock of LIBERTY (in
addition to shares of LIBERTY Common acquired other than pursuant to any
exercise of the Option) so that the ratio of (x) the sum of (A) the Optioned
Shares (including such Additional Optioned Shares, if any, calculated as a
result of one or more earlier Events) plus (B) the Additional Optioned Shares,
over the total number of shares of LIBERTY Common issued and outstanding after
each such Event, shall be equal to the ratio of (y) the sum of (C) 1,879,570
plus (D) such Additional Optioned Shares, if any, calculated as a result of one
or more earlier Events, over the total number of shares of LIBERTY Common
issued and outstanding immediately prior to each such Event, at an adjusted per
share purchase price equal to the Per Share Price multiplied by a fraction, the
numerator of which shall be equal to the number of shares of LIBERTY Common
purchasable prior to the adjustment and the denominator of which shall be equal
to the number of shares of LIBERTY Common purchasable after the adjustment;
provided, however, that nothing in this Option shall be construed as permitting
LIBERTY to take any action or enter into any transaction prohibited by this
Agreement.
6. LIBERTY shall, if requested by BANC ONE, as expeditiously as possible
file a registration statement on a form of general use under the Securities Act
of 1933, as amended, if necessary in order to permit the sale or other
disposition of the shares of LIBERTY Common that have been acquired upon
exercise of the Option in accordance with the intended method of sale or other
disposition requested by BANC ONE. BANC ONE shall provide all information
reasonably requested by LIBERTY for inclusion in any registration statement to
be filed hereunder. LIBERTY will use its best efforts to cause such
registration statement first to become effective and then to remain effective
for such period not in excess of two hundred and seventy calendar days from the
day such registration statement first becomes effective as may be reasonably
necessary to effect such sales or other dispositions. The registration
effected under this Section 6 shall be at LIBERTY's expense except for all
filing and agency fees and commissions and underwriting discounts and
commissions attributable to the sale of such securities and fees and
disbursements of BANC ONE's counsel related thereto, which amounts shall be
borne by BANC ONE. In no event shall LIBERTY be required to effect more than
one registration hereunder. The filing of any registration statement hereunder
may be delayed for such period of time as may reasonably be required if LIBERTY
determines that any such filing or the offering of any such shares of LIBERTY
Common would (i) impede, delay or otherwise interfere with any financing, offer
or sale of LIBERTY Common or any other securities of LIBERTY, or (ii) require
disclosure of material information which, if disclosed at that time, would be
materially harmful to the interests of LIBERTY and its shareholders. If
requested by BANC ONE in connection with any such registration, LIBERTY will
become a party to any underwriting agreement relating to the sale of such
shares, but only to the extent of obligating itself in respect of
representations, warranties, indemnities and other agreements customarily
required of issuers. Neither this Option Agreement nor the Option are
assignable by BANC ONE. BANC ONE and LIBERTY agree to use their respective
reasonable efforts to cause, and to cause any underwriters of any sale or other
disposition to cause, any sale or other disposition of the Optioned Shares and
any Additional Optioned Shares to be effected on a widely distributed basis.
7. Notices. All notices and other communications hereunder may be made by
mail, hand-delivery or by courier service. If notices and other communications
are made by nationally recognized overnight courier service for overnight
delivery, such notice shall be deemed to have been given one business day after
being forwarded to such a nationally recognized overnight courier service for
overnight delivery. All notices and other communications hereunder given to
any party shall be communicated to the remaining party to this Agreement by
mail or by hand-delivery in the same manner as herein provided.
(a) If to BANC ONE, to:
BANC ONE CORPORATION
Attention of: Chief Executive Officer
100 East Broad Street
Columbus, Ohio 43271
With a copy to:
BANC ONE CORPORATION
Attention of: Steven A. Bennett
General Counsel
100 East Broad Street
Columbus, Ohio 43271
(b) If to LIBERTY, to:
Liberty Bancorp, Inc.
Attention of: Charles E. Nelson
Chairman and Chief Executive Officer
100 North Broadway
Oklahoma City, Oklahoma 73102
With a copies to:
Wachtell, Lipton, Rosen & Katz
Attention of: Edward D. Herlihy
51 West 52nd Street
New York, New York, 10019
and
Crowe & Dunlevy
Attention of: Michael M. Stewart
1800 Mid-America Tower
20 North Broadway
Oklahoma City, Oklahoma 73102
IN WITNESS WHEREOF, this Agreement has been executed the day and year first
above written.
BANC ONE CORPORATION
ATTEST:
/s/ Charles F. Andrews By: /s/ Wiliam P. Boardman
- -------------------------- --------------------------
Assistant Secretary William P. Boardman
its Senior Executive Vice
President
Liberty Bancorp, Inc.
ATTEST:
/s/ Kenneth Brown By: /s/ Charles E. Nelson
- -------------------------- --------------------------
Secretary Charles E. Nelson
its Chairman of the Board and
Chief Executive Officer
EXHIBIT 99(a)
Option Agreement
Option Agreement, dated as of December 28, 1996 (this "Agreement"), by and
between Liberty Bancorp, Inc., a corporation organized under the laws of the
State of Oklahoma ("LIBERTY") and BANC ONE CORPORATION, a corporation organized
under the laws of the State of Ohio ("BANC ONE").
W I T N E S S E T H :
WHEREAS, LIBERTY and Banc One Oklahoma Corporation , an Ohio corporation and a
wholly owned subsidiary of BANC ONE ("BANC ONE OKLAHOMA"), together with BANC
ONE, have executed a Merger Agreement dated as of December 28, 1996 (the
"Merger Agreement") providing for the merger of LIBERTY with and into BANC ONE
OKLAHOMA, pursuant to which BANC ONE will acquire LIBERTY;
WHEREAS, Section 21 of the Merger Agreement provides that LIBERTY will execute
and deliver an option agreement, substantially in the form of this Agreement,
to BANC ONE prior to the close of business December 31, 1996;
NOW THEREFORE, in consideration of said Merger Agreement and their mutual
promises and obligations, the parties hereto adopt and make this Agreement as
follows:
1. LIBERTY hereby grants to BANC ONE an irrevocable option (the "Option")
to purchase in accordance with the terms of this Option Agreement at the
closing trade price of a share of the Common Stock, of LIBERTY ("LIBERTY
Common"), on December 30, 1996, as reported on the National Association of
Securities Dealers Automated Quotation System National Market System, per share
(the "Per Share Price") in cash up to 1,879,570 authorized but unissued shares
of LIBERTY Common (the "Optioned Shares"). The Option shall expire (such event
being referred to herein as the "Option Termination Event") if not exercised as
permitted under this Agreement prior to the earlier of (i) at the time the
merger of LIBERTY into BANC ONE OKLAHOMA becomes effective as set forth and
defined in Section 4 of the Merger Agreement (the "Effective Time"), (ii) BANC
ONE or LIBERTY receiving written notice from the Board of Governors of the
Federal Reserve System (the "Board") or its staff to the effect that the
exercise of the Option pursuant to the terms of this Agreement is not
consistent with Section 3 of the Bank Holding Company Act of 1956, as amended,
(iii) termination of the Merger Agreement by BANC ONE in accordance with the
provisions of Section 26 of the Merger Agreement if such termination occurs
prior to the occurrence of an Initial Triggering Event (as hereinafter
defined), (iv) the first business day after the five hundred and forty-eighth
calendar day following termination of the Merger Agreement by BANC ONE in
accordance with the provisions of Section 26 thereof, if such termination
follows the occurrence of an Initial Triggering Event, provided that the Option
shall in all events expire not later than 24 months after such Initial
Triggering Event, (v) termination of the Merger Agreement by LIBERTY in
accordance with the provisions of Section 26 thereof, or (vi) termination of
the Merger Agreement by mutual consent of BANC ONE and LIBERTY. If, in the
case of (iv), the Option is otherwise exercisable but cannot be exercised on
such day solely because of any injunction, order or similar restraint issued by
a court of competent jurisdiction, the Option shall expire on the twentieth
business day after such injunction, order or restraint shall have been
dissolved or when such injunction, order or restraint shall have become
permanent and no longer subject to appeal, as the case may be.
2. Provided that (i) no preliminary or permanent injunction or other order
issued by any Federal or state court of competent jurisdiction in the United
States prohibiting the exercise of the Option or the delivery of the Optioned
Shares shall be in effect and (ii) any such exercise shall otherwise be subject
to compliance with applicable law and (iii) BANC ONE is not then in material
breach of the Merger Agreement, BANC ONE may exercise the Option in whole or in
part at any time or from time to time after the occurrence of both an Initial
Triggering Event and a Purchase Event (as defined in Section 4 of this
Agreement) if, but only if, both the Initial Triggering Event and the Purchase
Event shall have occurred prior to the occurrence of an Option Termination
Event. In the event that BANC ONE wishes to exercise the Option, BANC ONE
shall give written notice of such exercise (the date of such notice being
herein called the "Notice Date") within 30 days following such Purchase Event
to LIBERTY specifying the number of Optioned Shares it will purchase pursuant
to such exercise and a place and date for the closing of such purchase which
date shall be within 45 days following the receipt of the last of any required
regulatory approvals, but in any event, within 365 days of the Purchase Event,
subject to reasonable extensions in order for BANC ONE to obtain required
regulatory approvals.
3. At any closing of the exercise of the Option, (i) BANC ONE will make
payment to LIBERTY of the aggregate price for the Optioned Shares in
immediately available funds, in an amount equal to the product of the Per Share
Price multiplied by the number of Optioned Shares being purchased at such
closing and (ii) LIBERTY will deliver to BANC ONE a duly executed certificate
or certificates representing the number of Optioned Shares so purchased,
registered in the name of BANC ONE or its nominee in the denominations
designated by BANC ONE in its notice of exercise. Unless counsel for LIBERTY
and BANC ONE agree that such shares are not "restricted shares" under federal
and/or state securities laws, certificates for such shares shall bear a legend
to that effect.
4. For purposes of this Agreement, an "Initial Triggering Event" shall have
occurred at such time as one of the following events shall have occurred and
BANC ONE shall have determined in good faith (and shall have notified LIBERTY
in writing of such determination) that there is a reasonable likelihood that,
as a result of the occurrence of any of the following events, consummation of
the Merger pursuant to the term of this Merger Agreement is jeopardized: (i)
any person as defined in [subsection] 3(a)(9) or 13(d)(3) of the Securities
Exchange Act of 1934, as amended (the "1934 Act") (other than BANC ONE or any
BANC ONE subsidiary or affiliate) shall have commenced a bona fide offer to
purchase shares of LIBERTY Common such that, upon consummation of said offer,
such person would own or control 10% or more of the outstanding shares of
LIBERTY Common, or shall have entered into an agreement with LIBERTY, or shall
have filed an application or notice with the Board or any other federal or
state regulatory agency for clearance or approval, to (A) merge or consolidate
or enter into any similar transaction, with LIBERTY, (B) purchase, lease or
otherwise acquire all or substantially all of the assets of LIBERTY or (C)
purchase or otherwise acquire (including by way of merger, consolidation, share
exchange or any similar transaction) securities representing 10% or more of the
voting power of LIBERTY; (ii) any person (other than BANC ONE, BANC ONE
OKLAHOMA, any BANC ONE subsidiary or affiliate, any subsidiary of LIBERTY
("LIBERTY Subsidiary") in a fiduciary capacity) or any current shareholder of
LIBERTY which has beneficial ownership of 10% or more of the outstanding shares
of LIBERTY Common (a "Current 10% Shareholder") shall have acquired beneficial
ownership or the right to acquire beneficial ownership of 10% or more of the
outstanding shares of LIBERTY Common (the term "beneficial ownership" for
purposes of this Agreement having the meaning assigned thereto in Section 13(d)
of the 1934 Act) or, in the case of a Current 10% Shareholder, said Current 10%
Shareholder shall have acquired beneficial ownership or the right to acquire
beneficial ownership of 10% or more of the outstanding shares of LIBERTY Common
in addition to those beneficially owned as of the date hereof; (iii) any person
(other than BANC ONE or any BANC ONE subsidiary or affiliate) shall have made a
bona fide proposal to LIBERTY after the date of the Merger Agreement by public
announcement or written communication that is the subject of public disclosure
or regulatory report or filing to (A) acquire LIBERTY by merger, consolidation,
purchase of all or substantially all of its assets or any other similar
transaction, or (B) make an offer described in clause (i), above; (iv) any
person shall have solicited proxies in a proxy solicitation subject to
Regulation 14A under the 1934 Act in opposition to approval of the Merger
Agreement by LIBERTY's shareholders; or (v) or LIBERTY shall have willfully
breached any provision of the Merger Agreement, which breach would entitle BANC
ONE to terminate the Merger Agreement and such breach shall not have been cured
pursuant to the
terms of the Merger Agreement. For purposes of this Agreement, a "Purchase
Event" shall have occurred at such time as (i) any person (other than BANC ONE
or any BANC ONE subsidiary or affiliate) acquires beneficial ownership of 50%
or more of the then-outstanding shares of LIBERTY Common, or (ii) LIBERTY
enters into an agreement with another person (other than BANC ONE or any BANC
ONE subsidiary) pursuant to which such person is entitled to acquire 50% or
more of the then-outstanding shares of LIBERTY Common.
5. If between the date of the Merger Agreement and the Effective Time, the
shares of LIBERTY Common shall be changed into a different number of shares by
reason of any reclassification, recapitalization, split-up, combination or
exchange of shares, or if a stock dividend thereon shall be declared with a
record date within said period (an "Event"), the number of Optioned Shares and
the Per Share Price shall be adjusted appropriately so as to restore BANC ONE
to its rights hereunder, including, without limitation, its right to purchase
that number of additional shares (the "Additional Optioned Shares")
representing ownership of the voting power of the capital stock of LIBERTY (in
addition to shares of LIBERTY Common acquired other than pursuant to any
exercise of the Option) so that the ratio of (x) the sum of (A) the Optioned
Shares (including such Additional Optioned Shares, if any, calculated as a
result of one or more earlier Events) plus (B) the Additional Optioned Shares,
over the total number of shares of LIBERTY Common issued and outstanding after
each such Event, shall be equal to the ratio of (y) the sum of (C) 1,879,570
plus (D) such Additional Optioned Shares, if any, calculated as a result of one
or more earlier Events, over the total number of shares of LIBERTY Common
issued and outstanding immediately prior to each such Event, at an adjusted per
share purchase price equal to the Per Share Price multiplied by a fraction, the
numerator of which shall be equal to the number of shares of LIBERTY Common
purchasable prior to the adjustment and the denominator of which shall be equal
to the number of shares of LIBERTY Common purchasable after the adjustment;
provided, however, that nothing in this Option shall be construed as permitting
LIBERTY to take any action or enter into any transaction prohibited by this
Agreement.
6. LIBERTY shall, if requested by BANC ONE, as expeditiously as possible
file a registration statement on a form of general use under the Securities Act
of 1933, as amended, if necessary in order to permit the sale or other
disposition of the shares of LIBERTY Common that have been acquired upon
exercise of the Option in accordance with the intended method of sale or other
disposition requested by BANC ONE. BANC ONE shall provide all information
reasonably requested by LIBERTY for inclusion in any registration statement to
be filed hereunder. LIBERTY will use its best efforts to cause such
registration statement first to become effective and then to remain effective
for such period not in excess of two hundred and seventy calendar days from the
day such registration statement first becomes effective as may be reasonably
necessary to effect such sales or other dispositions. The registration
effected under this Section 6 shall be at LIBERTY's expense except for all
filing and agency fees and commissions and underwriting discounts and
commissions attributable to the sale of such securities and fees and
disbursements of BANC ONE's counsel related thereto, which amounts shall be
borne by BANC ONE. In no event shall LIBERTY be required to effect more than
one registration hereunder. The filing of any registration statement hereunder
may be delayed for such period of time as may reasonably be required if LIBERTY
determines that any such filing or the offering of any such shares of LIBERTY
Common would (i) impede, delay or otherwise interfere with any financing, offer
or sale of LIBERTY Common or any other securities of LIBERTY, or (ii) require
disclosure of material information which, if disclosed at that time, would be
materially harmful to the interests of LIBERTY and its shareholders. If
requested by BANC ONE in connection with any such registration, LIBERTY will
become a party to any underwriting agreement relating to the sale of such
shares, but only to the extent of obligating itself in respect of
representations, warranties, indemnities and other agreements customarily
required of issuers. Neither this Option Agreement nor the Option are
assignable by BANC ONE. BANC ONE and LIBERTY agree to use their respective
reasonable efforts to cause, and to cause any underwriters of any sale or other
disposition to cause, any sale or other disposition of the Optioned Shares and
any Additional Optioned Shares to be effected on a widely distributed basis.
7. Notices. All notices and other communications hereunder may be made by
mail, hand-delivery or by courier service. If notices and other communications
are made by nationally recognized overnight courier service for overnight
delivery, such notice shall be deemed to have been given one business day after
being forwarded to such a nationally recognized overnight courier service for
overnight delivery. All notices and other communications hereunder given to
any party shall be communicated to the remaining party to this Agreement by
mail or by hand-delivery in the same manner as herein provided.
(a) If to BANC ONE, to:
BANC ONE CORPORATION
Attention of: Chief Executive Officer
100 East Broad Street
Columbus, Ohio 43271
With a copy to:
BANC ONE CORPORATION
Attention of: Steven A. Bennett
General Counsel
100 East Broad Street
Columbus, Ohio 43271
(b) If to LIBERTY, to:
Liberty Bancorp, Inc.
Attention of: Charles E. Nelson
Chairman and Chief Executive Officer
100 North Broadway
Oklahoma City, Oklahoma 73102
With a copies to:
Wachtell, Lipton, Rosen & Katz
Attention of: Edward D. Herlihy
51 West 52nd Street
New York, New York, 10019
and
Crowe & Dunlevy
Attention of: Michael M. Stewart
1800 Mid-America Tower
20 North Broadway
Oklahoma City, Oklahoma 73102
IN WITNESS WHEREOF, this Agreement has been executed the day and year first
above written.
BANC ONE CORPORATION
ATTEST:
/s/ Charles F. Andrews By: /s/ Wiliam P. Boardman
- -------------------------- --------------------------
Assistant Secretary William P. Boardman
its Senior Executive Vice
President
Liberty Bancorp, Inc.
ATTEST:
/s/ Kenneth Brown By: /s/ Charles E. Nelson
- -------------------------- --------------------------
Secretary Charles E. Nelson
its Chairman of the Board and
Chief Executive Officer
