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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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) July 19, 1996
FIRST FAMILY FINANCIAL CORPORATION
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(Exact Name of Registrant as Specified in Charter)
Florida 59-3277352
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(State of other jurisdiction) (IRS Employer Identification No.)
33-81818
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(Commission File Number)
2801 South Bay Street, Eustis, Florida 32726-6503
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(Address of Principal Executive Offices) (Zip Code)
(352) 357-4171
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(Registrant's Telephone Number, Including Area Code)
N/A
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(Former Name or Former Address, if Changed Since Last Report)
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Item 5. Other Events
A. Agreement and Plan of Merger. On July 19, 1996, First Family
Financial Corporation, a one-bank holding company located in Eustis, Florida
("First Family"), entered into an Agreement and Plan of Merger ("Merger
Agreement") with Colonial BancGroup, Inc. ("Colonial BancGroup") Montgomery,
Alabama, a bank holding company, with $4.5 billion in total assets and 127 full
service offices in Alabama, Florida, Georgia and Tennessee.
The acquisition will involve First Family being merged with and
into Colonial BancGroup, continuing with Colonial BancGroup as the surviving
corporation ("Merger"). Under the terms of the Merger Agreement, Colonial
BancGroup is proposing to acquire all of the outstanding capital stock of First
Family (545,000 shares of common stock) in a reorganization within the meaning
of Section 368(a) of the Internal Revenue Code. Colonial has also agreed to
assume the stock options which have been gratned representing 35,500 shares.
Each share of First Family's common stock, par value $.01 ("First Family
Stock"), issued and outstanding immediately prior to the effective time shall,
by virtue of the Merger Agreement and without any action on the part of the
holder thereof, be converted into and represent the right to receive shares of
Colonial BancGroup's Common Stock, par value $2.50 per share ("BancGroup Common
Stock") and cash with a total value equal to $23.50 per share of First Family
Stock ("Merger Consideration"), as follows. Each holder of First Family Stock
shall, for each such share, receive Merger Consideration of $11.75 in cash and
BancGroup Common Stock with a value of $11.75, as determined in the Merger
Agreement. The number of shares of BancGroup Common Stock into which each
outstanding share of First Family Stock will be converted will be equal to
$11.75 divided by the "Market Value" (as defined in the Merger Agreement).
Pursuant to the Merger Agreement, Market Value is the market value of the
BancGroup Common Stock on the effective date of the Merger as determined by the
closing prices reported by the New York Stock Exchange on each of the ten (10)
trading days, ending on the trading day immediately proceeding the effective
date of the Merger. Colonial BancGroup will assume all First Family stock
options outstanding and each option will represent the right to obtain BancGroup
Common Stock on substantially the same terms applicable to the First Family
options. The details of the Merger are more fully described in the Merger
Agreement attached hereto as Exhibit 1.
The transaction will be accounted for as a "purchase" and is
subject to the approval of First Family's shareholders and regulatory approvals
from the Federal Reserve Board and Florida Department of Banking and Finance. In
addition, First Family has received an oral opinion from Mercer Capital that the
consideration to be received by First Family's shareholders is "fair" to the
shareholders from a financial point of view. Prior to the distribution of the
Proxy Statement to the shareholders of First Family, Mercer Capital is to
prepare a written fairness opinion to confirm that the consideration to be
received by First Family's shareholders is fair as of that date.
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At June 30, 1996, First Family had total consolidated assets of
$155,890,000 total consolidated deposits of $143,362,000 and total consolidated
stockholders' equity of $9,222,000. The common stock of First Family is listed
on the NASDAQ-NMS under the symbol "FFML". On June 30, 1996, First Family's
common stock was traded at $21 per share.
B. Press Release. On July 25, 1996, First Family issued a joint
Press Release with Colonial BancGroup announcing the signing of a definitive
agreement whereby First Family will be acquired by Colonial BancGroup, a $4.5
billion bank holding company headquartered in Montgomery, Alabama. The specific
terms of the merger and consideration for the transaction are contained in the
Merger Agreement.
C. Correction to Letter to Shareholders. On July 25, 1996, a
letter to the shareholders was issued by First Family. This letter made the
statement that Colonial BancGroup, the parent company of Colonial Mortgage, was
"one of the ten largest mortgage banking companies in the United States". This
was incorrect. The letter should have indicated that at the time that Colonial
acquired Colonial Mortgage, the mortgage company was one of the ten largest
private mortgage companies in the United States.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
First Family Financial Corporation
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(Registrant)
Dated this 25th day of July, 1996 By: /s/David M. Shepherd
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David M. Shepherd
President
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