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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. ___)/*/
Continental Bank Corporation
(Name of Issuer)
Common Stock, $4.00 par value
(Title of Class of Securities)
21111310
(CUSIP Number)
Cheryl Sorokin
Executive Vice President and Secretary
BankAmerica Corporation
555 California Street, San Francisco, CA 94104
(415) 622-2091
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
January 27, 1994
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box [ ].
Check the following box if a fee is being paid with this statement [X]. (A fee
is not required only if the reporting person: (1) has a previous statement on
file reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.)
(See Rule 13d-7.)
Note: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to whom copies are to
be sent.
/*/ The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which
would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
THIS STATEMENT SHALL NOT BE CONSTRUED AS AN ADMISSION THAT THE REPORTING
PERSON IS THE BENEFICIAL OWNER OF ANY SECURITIES COVERED BY THE STATEMENT.
Page 1 of 27 Pages
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- --------------------
CUSIP NO. 21111310
- --------------------
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
BankAmerica Corporation
IRS Identification No. 94-1681731
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a)
(b)
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3 SEC USE ONLY
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4 SOURCE OF FUNDS
WC, OO
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(D) OR 2(E)
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
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7 SOLE VOTING POWER 10,173,300 (Including option to acquire
up to 10,169,000 in certain circumstances)
NUMBER OF
SHARES ---------------------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY - 0 -
EACH ---------------------------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER 10,171,300 (Including option to
PERSON acquire up to 10,169,000 in certain circumstances)
WITH
---------------------------------------------------------------
10 SHARED DISPOSITIVE POWER - 0 -
- ------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON 10,173,300 (Including option to acquire up to 10,169,000 in
certain circumstances)
- ------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
- ------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
16.6% (Including option to acquire up to 10,169,000 in certain
circumstances)
- ------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
HC
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Page 2 of 27 Pages
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Item 1. Security and Issuer
-------------------
This Statement relates to shares of Common Stock, par value $4 per share
("Issuer Common Stock"), of Continental Bank Corporation (the "Issuer"). The
address of the Issuer's principal executive offices is 231 South LaSalle Street,
Chicago, Illinois 60697.
Item 2. Identity and Background.
-----------------------
(a)-(c) and (f). This Statement is being filed by BankAmerica Corporation,
a bank holding company incorporated under the laws of the State of Delaware
("BankAmerica"). BankAmerica operates through a number of banking and non-
banking subsidiaries. The address of BankAmerica is Bank of America Center, 555
California Street, San Francisco, California 94104.
The names, business addresses, principal occupations and citizenship of the
directors and executive officers of BankAmerica are set forth in Annex A hereto
and are incorporated herein by reference. Other than executive officers and
directors, there are no persons or corporations controlling or ultimately in
control of BankAmerica.
(d) and (e). During the last five years, BankAmerica and, to the best
knowledge of BankAmerica, the executive officers and directors of BankAmerica
have not (i) been convicted in a criminal proceeding (excluding traffic
violations and similar misdemeanors) or (ii) been a party to a civil proceeding
of a judicial or administrative body of competent jurisdiction and as a result
of such proceeding was or is subject to a judgment, decree or final order
enjoining future violations of, or prohibiting or mandating activities subject
to, Federal or state securities laws or finding any violation with respect to
such laws.
Item 3. Source and Amount of Funds or Other Consideration.
-------------------------------------------------
BankAmerica has the option (the "Stock Option"), exercisable only in
certain circumstances (see Item 6), to acquire up to 10,169,000 shares (subject
to adjustment for certain dilutive events) of the Issuer Common Stock, at a
price of $37.50 per share, pursuant to the Stock Option Agreement dated as of
January 27, 1994, between the Issuer and BankAmerica (the "Stock Option
Agreement"), a copy of which is attached as Exhibit 10 to BankAmerica's Current
Report on Form 8-K filed with the Commission on February 3, 1994, and
incorporated herein by reference. Execution and delivery of the Stock Option
Agreement by the Issuer was a condition to the Agreement and Plan of Merger
dated as of January 27, 1994, between BankAmerica and the Issuer (the "Merger
Agreement"), a copy of which is attached as Exhibit 2 to BankAmerica's Current
Report on Form 8-K filed with
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the Commission on February 3, 1994, and incorporated herein by reference.
In the event BankAmerica acquires shares pursuant to the Stock Option
Agreement, it is currently anticipated that the funds required to purchase such
shares would be provided from BankAmerica's working capital or by borrowings
from a source yet to be determined.
Item 4. Purpose of Transaction.
----------------------
The grant of the option, exercisable only in certain circumstances, to
acquire shares of Issuer Common Stock was a condition to the execution of the
Merger Agreement, pursuant to which the Issuer will, subject to certain
conditions being satisfied or waived, be merged with and into BankAmerica (the
"Merger").
As a result of the Merger, each outstanding share of Issuer Common Stock
will be converted either all into common stock of BankAmerica or all into cash.
To the extent BankAmerica stock is received, the Merger is expected to be tax
free to the Issuer's shareholders, although such receipt of stock could become
taxable under certain circumstances. However, it is a condition to the Merger
closing that the Issuer's counsel render an opinion for the Issuer that the
Merger qualifies as a tax free reorganization under the Internal Revenue Code,
except for cash payments. Some of the basic terms of the Merger are summarized
below and in the joint press release of BankAmerica and the Issuer issued
January 28, 1994 and attached as Exhibit 99 to BankAmerica's Current Report on
Form 8-K filed with the Commission on February 3, 1994, and incorporated herein
by reference. The Merger Agreement is attached as Exhibit 2 to BankAmerica's
Current Report on Form 8-K filed with the Commission on February 3, 1994, and
incorporated herein by reference, and this summary is qualified in its entirety
by reference to the full Merger Agreement.
The number of shares or fractions thereof of BankAmerica common stock to be
issued in the Merger is subject to adjustment, pursuant to an exchange ratio
contained in the Merger Agreement. The final exchange ratio will be based on
the average of the closing prices of BankAmerica common stock during the 10
consecutive days on which shares of BankAmerica common stock are traded on the
New York Stock Exchange ending on the 10th calendar day immediately prior to the
anticipated effective time of the Merger (the "Final BAC Stock Price"). So long
as the Final BAC Stock Price does not exceed $55.84 per BankAmerica share and is
not less than $36.16 per BankAmerica share and so long as the number of
outstanding shares of Issuer Common Stock does not increase as a result of the
exercise of employee stock options outstanding at the date of the Merger
Agreement, the number of shares of BankAmerica common stock to be issued in the
Merger
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will remain the same (approximately 21.25 million shares). Such amount is
herein referred to as the "Stock Amount." As of January 26, 1994, there were,
excluding treasury shares, 51,103,022 shares of Issuer Common Stock
outstanding (as revised from the number of shares of Issuer Common Stock shown
in BankAmerica's Current Report on Form 8-K filed with the Commission on
February 3, 1994).
If the Final BAC Stock Price is in excess of $55.84, then the Stock Amount
and the per share cash and stock consideration will decline so that the amount
to be received (whether all in stock or all in cash) will be the same as if the
Final BAC Stock Price had been equal to $55.84. If the Final BAC Stock Price is
less than $36.16, the Issuer may terminate the Merger Agreement unless: (i)
BankAmerica agrees to increase the Stock Amount and to increase the per share
stock and cash consideration to be received in the Merger to an amount equal to
the amounts which would have been received by the Issuer's common shareholders
under the Merger Agreement (whether all in stock or all in cash) if the Final
BAC Stock Price had been equal to $36.16; and (ii) the Issuer's counsel renders
an opinion for the Issuer that the Merger qualifies as a tax free reorganization
under the Internal Revenue Code, except for cash payments.
The Issuer's shareholders may elect, at their option, to receive cash in
the Merger, or to receive BankAmerica common stock in the Merger or to make no
election under the Merger Agreement. The per share stock and cash amounts
received per share of Issuer Common Stock will be equal in value to each other
based on valuing the BankAmerica common stock at the Final BAC Stock Price. The
aggregate amount of cash to be paid to the Issuer's shareholders is fixed at
approximately $939 million so long as the number of outstanding shares of Issuer
Common Stock does not increase as a result of the exercise of employee stock
options outstanding at the date of the Merger Agreement. The Merger Agreement
provides for a random allocation procedure (as determined by BankAmerica and the
Issuer) in the event of an oversubscription in respect of stock or cash.
Fractional shares will not be issued but the value of such shares will be paid
to the holders thereof in cash.
The Merger Agreement also provides for the termination of the Merger
Agreement by BankAmerica, in its sole discretion, during the 10 business day
period beginning after the date of receipt by BankAmerica of certain disclosure
schedules of the Issuer in form and detail of presentation reasonably
satisfactory to BankAmerica. In addition, the disclosure schedule receipt date
also begins a 30 calendar day period (10 business days of which overlap the sole
discretion termination period described in the preceding sentence) during which
period BankAmerica may terminate the Merger Agreement if BankAmerica identifies
any circumstances which, in the reasonable judgment of BankAmerica's Board of
Directors (including a committee thereof), acting in good faith and with due
regard for principles of fair dealing, could: (i) materially and adversely
impact the reasonably expected financial or business benefits to BankAmerica of
the Merger, (ii) be inconsistent in any material and adverse respect
Page 5 of 27 Pages
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with any of the representations and warranties of the Issuer contained in the
Merger Agreement, (iii) materially and adversely affect the business,
operations, properties, financial condition, results of operations or prospects
of the Issuer and its subsidiaries on a consolidated basis or (iv) deviate
materially and adversely from the Issuer's financial statements for the year or
quarter ended December 31, 1993. The timing of such dates cannot be determined
with certainty since the point-in-time that satisfactory disclosure schedules
will be received by BankAmerica cannot presently be determined. In addition,
under certain circumstances, BankAmerica or the Issuer may terminate the Merger
Agreement in certain other events, as specified in the Merger Agreement.
In addition, each share of the Issuer's Adjustable Rate Preferred Stock,
Series 1 and 2 (collectively, "Issuer Preferred Stock") outstanding immediately
prior to the effective time of the Merger (excluding shares held by dissenting
holders, if any, exercising appraisal rights) will be converted, respectively,
into one share of Adjustable Rate Preferred Stock, Series 1 and 2, respectively,
of BankAmerica ("BankAmerica Preferred Stock"). Fractional shares will not be
issued but the value of such shares will be paid to the holders thereof in cash.
As a result of the conversion of the Issuer Common Stock and the Issuer
Preferred Stock, all shares of Issuer Common Stock and Issuer Preferred Stock
will be delisted from the New York Stock Exchange, will not be listed on any
national securities exchange or quoted in any inter-dealer quotation system,
will be eligible for termination of registration pursuant to Section 12(g)(4) of
the Securities Exchange Act of 1934, as amended, and the holders of Issuer
Common Stock and Issuer Preferred Stock will become stockholders of BankAmerica.
Payment of regular quarterly cash dividends as provided by and in
accordance with the present terms of the Issuer Preferred Stock is permitted
under the Merger Agreement.
The foregoing summary of the terms of the Merger Agreement does not purport
to be complete and is qualified in its entirety by reference to the full text of
the Merger Agreement, a copy of which is attached as Exhibit 2 to BankAmerica's
Current Report on Form 8-K filed with the Commission on February 3, 1994 and
incorporated herein by reference.
Item 5. Interest in Securities of the Issuer.
------------------------------------
(a) and (b). BankAmerica has the right, exercisable only in certain
circumstances, to acquire up to 10,169,000 shares (subject to adjustment for
certain dilutive events) of Issuer Common Stock constituting approximately 16.6%
of the issued and outstanding shares of Issuer Common Stock adjusted to reflect
the issuance to BankAmerica of such 10,169,000 shares, or
Page 6 of 27 Pages
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approximately 19.9 percent of the issued and outstanding shares of Issuer Common
Stock, without adjustment to reflect the issuance to BankAmerica of such
10,169,000 shares. When and if BankAmerica acquires such shares, it will have
sole voting and investment power with respect thereto, subject to certain
transfer restrictions. BankAmerica disclaims beneficial ownership of such
shares until the events allowing BankAmerica to acquire such shares occur.
BankAmerica and certain of BankAmerica's subsidiaries may be deemed to be
the beneficial owner of 4,300 shares of Issuer Common Stock (representing 0.007
percent of the class assuming the Stock Option is exercised in full and 0.008
percent of the class assuming the Stock Option is not exercised) held in trust
accounts, custodial accounts and the like for such subsidiaries' customers
("trust account shares"). BankAmerica and such subsidiaries have sole voting
and investment power with respect to 2,300 such shares, and sole voting and no
investment power with respect to 2,000 such shares. In addition, such
subsidiaries hold 93,000 shares of Issuer Common Stock as to which such
subsidiaries have no voting power and no investment power. Such holdings may
change in response to investment decisions made by BankAmerica's subsidiaries as
trustee or as such accounts are opened and closed. BankAmerica disclaims
beneficial ownership of such shares.
Other than the Stock Option and the trust account shares described above,
neither BankAmerica nor any of its subsidiaries beneficially owns any shares of
Issuer Common Stock. To the best knowledge of BankAmerica, none of
BankAmerica's executive officers or directors beneficially owns any shares of
Issuer Common Stock.
(c) Except for the acquisition of the Stock Option, there have been no
transactions in shares of Issuer Common Stock by BankAmerica, or to the best
knowledge of BankAmerica, by any of BankAmerica's executive officers or
directors, during the past 60 days.
(d) As described in paragraphs (a) and (b) above, BankAmerica and various
subsidiaries of BankAmerica may be deemed to be beneficial owners of shares of
Issuer Common Stock in trust accounts for customers as to which BankAmerica and
such subsidiaries have no investment powers. The beneficiaries of such trust
accounts may have or share the power to direct the payment of dividends and
proceeds from the sale of such shares.
(e) Not applicable.
Page 7 of 27 Pages
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Item 6. Contracts, Arrangements, Understandings or Relationships With Respect to
------------------------------------------------------------------------
Securities of the Issuer.
------------------------
Stock Option Agreement
----------------------
Set forth below is a description of selected provisions of the Stock Option
Agreement.
The Stock Option Agreement provides for the purchase by BankAmerica of up
to 10,169,000 shares, subject to certain adjustments, of Issuer Common Stock
(the "Option Shares") at an exercise price, subject to certain adjustments, of
$37.50 per share, payable in cash. The Option Shares, if issued pursuant to the
Stock Option Agreement, would represent approximately 19.9 percent of the issued
and outstanding shares of Issuer Common Stock without giving effect to the
issuance of any shares pursuant to an exercise of the Stock Option.
The number of shares of Issuer Common Stock subject to the Stock Option
will be increased to the extent that the Issuer issues additional shares of
Issuer Common Stock (otherwise than pursuant to an exercise of the Stock Option)
such that the number of Option Shares will continue to equal 19.9 percent of the
then issued and outstanding shares of Issuer Common Stock without giving effect
to the issuance of shares pursuant to an exercise of the Stock Option. In the
event the Issuer issues or agrees to issue any shares of Issuer Common Stock
(other than as permitted under the Merger Agreement) at a price less than $37.50
per share (or lower than an adjusted price per share), the exercise price will
be equal to such lesser price. The number of shares of Issuer Common Stock
subject to the Stock Option, and the applicable exercise price per Option Share,
also will be appropriately adjusted in the event of any stock dividend, split-
up, merger, recapitalization, combination, subdivision, conversion, exchange of
shares, or similar event relating to the Issuer.
BankAmerica or any other holder or holders of the Stock Option
(collectively, the "Holder") may exercise the Stock Option, in whole or in part,
subject to regulatory approval, at any time within 30 days (subject to extension
as provided in the Stock Option Agreement) after both an "Initial Triggering
Event" and a "Subsequent Triggering Event" occur prior to termination of the
Stock Option. "Initial Triggering Event" is defined as the occurrence of any of
the following events:
(i) The Issuer or any Issuer Subsidiary (as defined in the Stock Option
Agreement), without BankAmerica's prior written consent, entering into an
agreement with any person or group (other than BankAmerica or any subsidiary of
BankAmerica (individually, a "BankAmerica Subsidiary" and, collectively,
"BankAmerica Subsidiaries")) to engage in, or the Issuer's Board of Directors
recommending that the Issuer's stockholders approve or accept (other than as
contemplated by the Merger Agreement),
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any (x) merger or consolidation, or similar transaction, involving the Issuer or
any significant Issuer Subsidiary, (y) purchase, lease, or other acquisition
representing 15 percent or more of the consolidated assets of the Issuer or any
significant Issuer Subsidiary, or (z) purchase or other acquisition (including
by way of merger, consolidation, share exchange or otherwise) of securities
representing 10 percent or more of the voting power of the Issuer or any
significant Issuer Subsidiary (each of the transactions described in the
preceding clauses (x)-(z) herein is referred to herein and in the Stock Option
Agreement as an "Acquisition Transaction");
(ii) The Issuer or any Issuer Subsidiary, without having received
BankAmerica's prior written consent, shall have authorized, recommended,
proposed or publicly announced its intention to authorize, recommend or propose,
an agreement to engage in an Acquisition Transaction with any person other than
BankAmerica or a BankAmerica Subsidiary, or the Board of Directors of the Issuer
shall have publicly withdrawn or modified, or publicly announced its intent to
withdraw or modify, its recommendation that the stockholders of the Issuer
approve the transactions contemplated by the Merger Agreement;
(iii) any person or group (other than BankAmerica, any BankAmerica
Subsidiary or any Issuer Subsidiary acting in a fiduciary capacity) acquiring
beneficial ownership or the right to acquire beneficial ownership of 10 percent
of more of the outstanding shares of Issuer Common Stock;
(iv) any person or group (other than BankAmerica or any BankAmerica
Subsidiary) making a bona fide proposal to the Issuer or its stockholders by
---- ----
public announcement or written communication that is or becomes the subject of
public disclosure to engage in an Acquisition Transaction;
(v) a third party making a proposal to the Issuer or its shareholders to
engage in an Acquisition Transaction, followed by the Issuer breaching any
covenant or obligation contained in the Merger Agreement, such breach entitling
BankAmerica to terminate the Merger Agreement, and such breach not being cured
prior to the date that BankAmerica sends notice of its exercise of the Stock
Option; or
(vi) any person or group (other than BankAmerica or any BankAmerica
Subsidiary), other than in connection with a transaction to which BankAmerica
has given its prior written consent, filing an application or notice with the
Board of Governors of the Federal Reserve System (the "Federal Reserve Board")
or other federal or state bank regulatory authority, which application or notice
has been accepted for processing, for approval to engage in an Acquisition
Transaction.
"Subsequent Triggering Event" is defined as either (A) the acquisition by
any person or group of beneficial ownership of 20 percent or more of the then
outstanding Issuer
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Common Stock, or (B) the occurrence of the Initial Triggering Event described in
clause (i) above, except that the percentage reference in subclause (z) thereof
shall be 20 percent.
The Stock Option terminates (i) at the effective time of the Merger, (ii)
upon termination of the Merger Agreement in accordance with the terms thereof if
such termination occurs prior to the occurrence of an Initial Triggering Event,
or (iii) twelve months after termination of the Merger Agreement following the
occurrence of an Initial Triggering Event (provided that if an Initial
Triggering Event occurs after or continues beyond such termination, the Stock
Option will terminate twelve months from the expiration of the last Initial
Triggering Event to expire, but in no event more than 18 months after such
termination).
Within 30 days (subject to extension as provided in the Stock Option
Agreement) after a Subsequent Triggering Event and prior to the termination of
the Stock Option, BankAmerica (on behalf of itself or any subsequent Holder) may
demand that the Stock Option and the related Option Shares be registered under
the Securities Act of 1933, as amended (the "Securities Act"). Upon such
demand, the Issuer must promptly prepare, file and keep current a shelf
registration subject to certain exceptions. BankAmerica is entitled to two such
registrations so long as the second request is within 18 months of the first
request.
Within 30 days (subject to extension as provided in the Stock Option
Agreement) after a Subsequent Triggering Event and prior to termination of the
Stock Option, subject to regulatory approval, the Issuer is required (i) at the
request of the Holder, to repurchase the Stock Option from the Holder at a price
(the "Option Repurchase Price") equal to the amount by which (x) the
"market/offer price" (as hereinafter defined) exceeds (y) the then applicable
Stock Option exercise price, multiplied by the number of shares for which the
Stock Option may then be exercised plus BankAmerica's Out-of-Pocket Expenses (as
hereinafter defined) to the extent not previously reimbursed; and (ii) at the
request of the owner of the Option Shares from time to time (the "Owner"), to
repurchase such number of Option Shares from the Owner as the Owner designates
at a price per share (the "Option Share Repurchase Price") equal to the
"market/offer price" multiplied by the number of Option Shares so designated
plus BankAmerica's Out-of-Pocket Expenses to the extent not previously
reimbursed. "Out-of-Pocket Expenses" means BankAmerica's reasonable out-of-
pocket expenses incurred in connection with the transactions contemplated by the
Merger Agreement, including legal, accounting, and investment banking fees.
"Market/offer price" means the highest of (A) the highest price per share of
Issuer Common Stock at which a tender offer or exchange offer therefor has been
made, (B) the price per share of Issuer Common Stock to be paid by any third
party pursuant to an agreement with the Issuer, (C) the highest closing price
for shares of Issuer Common Stock quoted on the New York Stock
Page 10 of 27 Pages
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Exchange or other principal trading market, if applicable, within the six-month
period immediately preceding the date the Holder gives notice of the required
repurchase of the Stock Option or the Owner gives notice of the required
repurchase of Option Shares, as the case may be, and (D) in the event of a sale
representing 15 percent or more of the Issuer's assets, the sum of the price
paid in such sale for such assets and the current market value of the remaining
assets of the Issuer as determined by a nationally recognized investment banking
firm, selected by the Holder or the Owner, as the case may be, divided by the
number of shares of Issuer Common Stock outstanding at the time of such sale.
In the event that, prior to termination of the Stock Option, the Issuer
enters into an agreement (i) to consolidate with or merge into any entity other
than BankAmerica or one of its subsidiaries and shall not be the continuing or
surviving corporation of such consolidation or merger, (ii) to permit any entity
other than BankAmerica or one of its subsidiaries to merge into the Issuer with
the Issuer as the continuing or surviving corporation, but in connection
therewith the then outstanding shares of Issuer Common Stock are changed into or
exchanged for stock or other securities of any other person or cash or any other
property, or the then outstanding shares of Issuer Common Stock after such
merger represent less than 50 percent of the outstanding shares or share
equivalents of the merged company, or (iii) to sell or transfer all or
substantially all of its assets to any entity other than to BankAmerica or one
of its subsidiaries, then the Stock Option will be converted into, or exchanged
for, an option (a "Substitute Option") to purchase shares of common stock of, at
the Holder's option, either the continuing or surviving corporation of a merger
or a consolidation, the transferee of all or substantially all of the Issuer's
assets, or the person controlling such continuing or surviving corporation or
transferee. The number of shares subject to the Substitute Option and the
exercise price per share will be determined in accordance with a formula in the
Stock Option Agreement. To the extent possible, the Substitute Option will
contain other terms and conditions that are the same as those in the Stock
Option (after giving effect to the provisions described in the next paragraph).
Subject to regulatory approval, the issuer of a Substitute Option will be
required to repurchase such option at the request of the holder thereof and to
repurchase any shares of such issuer's common stock ("Substitute Common Stock")
issued upon exercise of a Substitute Option ("Substitute Shares") at the request
of the owner thereof. The repurchase price for a Substitute Option will equal
the amount by which (A) the "Highest Closing Price" (as hereinafter defined)
exceeds (B) the exercise price of the Substitute Option, multiplied by the
number of shares of Substitute Common Stock for which the Substitute Option may
be exercised, plus BankAmerica's Out-of-Pocket Expenses. The repurchase price
for Substitute Shares shall equal the "Highest
Page 11 of 27 Pages
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Closing Price" multiplied by the number of Substitute Shares to be repurchased,
plus BankAmerica's Out-of-Pocket Expenses. As used herein, "Highest Closing
Price" means the highest closing price for shares of Substitute Common Stock
within the six-month period immediately preceding the date the holder gives
notice of the required repurchase of the Substitute Option or the owner gives
notice of the required repurchase of Substitute Shares, as the case may be.
Neither BankAmerica nor the Issuer may assign any of its respective rights
and obligations under the Stock Option Agreement or the Stock Option to any
other person without the other party's written consent, except that if a
Subsequent Triggering Event occurs prior to termination of the Stock Option,
within 30 days thereafter (subject to extension as provided in the Stock Option
Agreement), BankAmerica, subject to the Stock Option Agreement, may assign in
whole or in part its rights and obligations thereunder. In addition, until 30
days after the Federal Reserve Board approves an application by BankAmerica to
acquire the Option Shares, BankAmerica may not assign its rights under the Stock
Option except in (i) a widely dispersed public distribution, (ii) a private
placement in which no one party acquires the right to purchase in excess of two
percent of the voting shares of the Issuer, (iii) an assignment to a single
party for the purpose of conducting a widely dispersed public distribution on
BankAmerica's behalf, or (iv) any other manner approved by the Federal Reserve
Board.
Notwithstanding any other provision of the Stock Option Agreement, if a
Holder, an Owner, or certain related parties offer or propose to engage in an
Acquisition Transaction (other than as contemplated by the Merger Agreement)
without the prior written consent of the Issuer, then (i) in the case of a
Holder or related party thereof, the Stock Option held by it shall immediately
terminate and be of no further force or effect and (ii) in the case of an Owner
or any related party thereof, the Stock Option Shares held by it will be
repurchasable by the Issuer immediately at the then applicable Stock Option
exercise price.
In the event BankAmerica (or any subsequent Holder) wishes to exercise the
Stock Option, it must send to the Issuer a written notice (the date of which is
referred to as the "Notice Date") specifying (i) the total number of shares it
will purchase pursuant to such exercise and (ii) a "Closing Date" not less than
three nor more than 60 days from the Notice Date. If the purchase and sale of
the Stock Option cannot be consummated because of an applicable judgment,
decree, order, law or regulation, the period of time referred to in this
paragraph shall run from the date that the restriction on consummation lapses.
If prior notification of or approval of the Federal Reserve Board is required,
BankAmerica (or any subsequent Holder) will promptly file the required notice or
application. The period of time referred to in this paragraph will run from the
Page 12 of 27 Pages
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date the notification period expires or any necessary approval is granted. In
no event shall the Closing Date be more than 18 months after the related Notice
Date.
If the Stock Option terminates under certain circumstances as described in
the Stock Option Agreement, BankAmerica (or any subsequent Holder) may have as
many as 30 days subsequent to such termination to exercise the Stock Option (or
Substitute Option) in connection with the resale of Issuer Common Stock or other
securities pursuant to a registration statement as provided in the Stock Option
Agreement.
The rights and obligations of BankAmerica under the Stock Option Agreement
are subject to receipt of any required regulatory approvals. Without the prior
approval of the Federal Reserve Board, BankAmerica may not acquire more than
five percent of the outstanding Issuer Common Stock. BankAmerica intends to
file an application for such approval as soon as practicable.
The foregoing summary of the terms of the Stock Option Agreement does not
purport to be complete and is qualified in its entirety by reference to the full
text of the Stock Option Agreement, a copy of which is attached as Exhibit 10 to
BankAmerica's Current Report on Form 8-K filed with the Commission on February
3, 1994 and incorporated herein by reference.
Merger Agreement
----------------
Issuer and BankAmerica are also parties to the Merger Agreement, a copy of
which is filed as Exhibit 2 to BankAmerica's Current Report on Form 8-K filed
with the Commission on February 3, 1994 and incorporated by reference herein.
(See Item 4.)
Item 7. Material to be Filed as Exhibits.
--------------------------------
(a) Agreement and Plan of Merger dated as of January 27, 1994, between
BankAmerica and the Issuer (incorporated by reference to Exhibit 2 to
BankAmerica's Current Report on Form 8-K filed February 3, 1994, file no.
002-45003).
(b) Stock Option Agreement dated as of January 27, 1994, between
BankAmerica and the Issuer (incorporated by reference to Exhibit 10 to
BankAmerica's Current Report on Form 8-K filed February 3, 1994, file no.
002-45003).
(c) Joint Press Release dated January 28, 1994 of BankAmerica and the
Issuer (incorporated by reference to Exhibit 99 to BankAmerica's Current Report
on Form 8-K filed February 3, 1994, file no. 002-45003).
Page 13 of 27 Pages
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of its knowledge and belief, the
undersigned certifies that the information set forth in this statement is true,
complete and correct.
February 7, 1994 BANKAMERICA CORPORATION
By: /s/ CHERYL SOROKIN
------------------------------------
Name: Cheryl Sorokin
Title: Executive Vice President
and Secretary
Page 14 of 27 Pages
<PAGE>
GENERAL OPERATING AND BORROWING RESOLUTION
------------------------------------------
Following is a copy of BankAmerica's General Operating and Borrowing
Resolution pursuant to which Cheryl Sorokin, Executive Vice President and
Secretary of BankAmerica, executed this Schedule 13D (see paragraph 2 of the
resolution on page 20 of this Schedule 13D).
Page 15 of 27 Pages
<PAGE>
Board of Directors November 1, 1993
BankAmerica Corporation
BANKAMERICA CORPORATION
GENERAL OPERATING AND BORROWING RESOLUTION
------------------------------------------
The Board of Directors of BankAmerica Corporation ("BAC") authorizes and
determines:
1. Any two BAC officers listed below under the designation "Group 1" (the
"Officers"):
GROUP 1
-------
the Chairman of the Board
the Chief Executive Officer
the President
any Vice Chairman of the Board
any Vice Chairman
the Chief Financial Officer
the Treasurer
the Financial Controller
any Executive Vice President
any Senior Vice President
any Vice President
the Secretary
or any one of such Officers in conjunction with any one of the BAC officers
listed below under the designation "GROUP 2":
GROUP 2
-------
any Assistant Treasurer
any Assistant Secretary
any Assistant Vice President
be, and hereby are, authorized to make, execute, deliver, amend and terminate,
in the name and on behalf of BAC, any and all such contracts, instruments,
documents and agreements, and to perform any and all such acts, in the name and
on behalf of BAC, as are deemed by such Officers to be desirable in connection
with any of the activities set forth below; provided, however, that the opening
of any account described in subparagraph (a) of this paragraph 1 requires the
signature of a Vice Chairman or above; and provided, further, that any contract,
instrument, document or agreement for any borrowing described in subparagraph
(b) of this paragraph 1 requires the signature of the Treasurer or an Assistant
Treasurer in addition to one other officer listed in GROUP 1 or 2 above, as the
case may be; and provided, further, that notes representing commercial paper
need be signed only by the Treasurer or an Assistant Treasurer. The execution
of any contract, instrument, document or agreement by one or more
Page 16 of 27 Pages
<PAGE>
Officers thereunto duly authorized by the foregoing shall be conclusive
evidence, between any party to whom it is delivered and BAC, of the
determination and approval by BAC of the matters described therein and of the
transaction undertaken thereby, unless such party has previously received
written notice of the revocation of this resolution.
(a) Establishment and use of accounts
---------------------------------
where any Officer deems it desirable for the operations of BAC, to
establish and maintain with Bank of America National Trust and Savings
Association and any other banks, checking, time deposit, and other bank
accounts, upon such terms and conditions as may be agreed upon with such banks;
to execute, endorse or deliver on behalf of BAC, remittances, checks, drafts or
other requests for withdrawal, transfer or deposit of funds from or to any of
such bank accounts as shall be maintained in the name of BAC, and any bank
maintaining any such account is hereby authorized and directed to honor
remittances, checks, drafts or other requests for withdrawal, transfer or
deposit of funds from or to any such account by or from such Officers;
(b) Borrowing
---------
to borrow, in each case for an original term not exceeding nine months,
from banks and other lenders, including subsidiaries of BAC, from time to time,
such sums of money as may be deemed desirable for BAC to conduct its general
business affairs and to grant security interests in existing and future assets
of BAC to assure repayment of such indebtedness; provided that no such borrowing
shall be permitted if, by reason of such new borrowing and after giving effect
thereto, the aggregate amount of all borrowings of BAC having at their inception
a term of nine months or less, other than such borrowings from subsidiaries of
BAC, but including borrowings through the issuance of commercial paper pursuant
to subparagraph (c) of this paragraph 1, would exceed the sum of SIX BILLION
DOLLARS ($6,000,000,000);
In computing compliance with the foregoing limitation:
(i) Borrowings subject to such limitation which are expressed in foreign
currencies shall be valued in U.S. dollars at least monthly, and the
most recent valuation shall govern the determination whether any
additional borrowing complies with such limitation;
(ii) Obligations of BAC arising out of the issuance of travelers cheques,
official checks and money orders, offered to the public as instruments
of funds transmission and not bearing interest, are not subject to the
foregoing limitation, nor
Page 17 of 27 Pages
<PAGE>
shall they be included in computing compliance therewith; and
(iii) Lines of credit or other commitments to lend obtained by BAC shall not
be deemed borrowings except to the extent actually drawn upon or
otherwise used;
If an express written determination is made by the person or persons thereunto
duly authorized by paragraph 11 of the Resolution re Senior and Subordinated
Debt adopted by this Board on November 1, 1993, or any resolution amending or
superseding such resolution (the "Senior and Subordinated Debt Resolution"),
that any proposed borrowings of BAC having at their inception a term of one
month or more but not more than nine months are to be carried out in accordance
with and subject to the requirements of the Senior and Subordinated Debt
Resolution (whether or not the indebtedness represented by any such borrowings
is of a kind generally covered by this subparagraph), BAC's aggregate liability
for the amount of all such borrowings shall not be counted against the foregoing
limitation. In the absence of any such express written determination, BAC's
aggregate liability for the amount of all such borrowings shall be counted
against the foregoing limitation;
(c) Commercial paper
----------------
subject to the limitation in subparagraph (b) of this paragraph 1, to
issue and sell commercial paper in amounts deemed desirable by any Officer, in
compliance with all applicable laws and regulations of governmental agencies,
such commercial paper to be issued in the form of unsecured negotiable
promissory notes (or in the form of book entries containing all of the
information necessary for the completion and delivery of such notes), each note
or book entry to be in an amount of at least ONE HUNDRED THOUSAND DOLLARS
($l00,000), with maturities not to exceed nine months from the date of issue,
and at such rate or rates of interest, at such time or times, upon such other
terms and conditions as shall be determined, and under such agreement or
agreements or pursuant to such arrangements deemed desirable, by any Officer, in
view of BAC's financial requirements; and, without limiting the generality of
the foregoing authorization, (l) to enter into agreements or arrangements with
Bank of America NT&SA, BA Securities, Inc. or any other banks or entities
providing for the issuing, safekeeping, completion, countersignature, and
delivery of BAC's commercial paper, and (2) to enter into agreements or
arrangements for backup lines of credit for commercial paper; provided that
borrowings under any such committed lines of credit shall be subject to the
limitation on borrowings set forth in subparagraph (b) of this paragraph 1, but
the unused amounts of credit under such lines shall not be deemed a borrowing
subject to such limitation;
Page 18 of 27 Pages
<PAGE>
(d) Travelers cheques, official checks and money orders
---------------------------------------------------
in addition to and independent of the borrowing authorized in subparagraph
(b) of this paragraph 1 and commercial paper issuance authorized in
subparagraph (c) of this paragraph 1, to issue travelers cheques, official
checks and money orders, offered to the public as instruments of funds
transmission and not bearing interest, subject to compliance with all
applicable laws and regulations of governmental agencies and, without
limiting the generality of the foregoing authorization, to enter into
agreements or arrangements with BA Cheque Corporation and any other
entities providing for the offering, delivery and servicing of BAC's
travelers cheques, official checks and money orders;
(e) Extending credit
----------------
to extend credit to subsidiaries and, to the extent permitted to BAC under
applicable laws, to affiliates of BAC in amounts and on terms deemed desirable
by any Officer;
(f) Powers of attorney
------------------
to grant such powers of attorney, proxies, and other agency powers to such
persons and on such terms as are deemed desirable by any Officer for carrying on
the business and affairs of BAC, including, without limiting the generality of
the foregoing authorization, all contracts and documents of any sort relating
to: applications to and negotiations with any and all governmental entities and
agencies in the United States and abroad for the purpose of obtaining the
necessary permits or approvals for operations of BAC anywhere in the world; the
commencement and prosecution or defense of proceedings on behalf of and against
BAC before courts, administrative tribunals, boards of arbitrators, and similar
entities, and the compromise or settlement of the same; the voting of voting
securities and other voting interests which may be held in corporations and
other entities by BAC; and applications for letters patent, trademarks,
copyrights, service marks, and similar matters on behalf of BAC;
(g) Service agreements
------------------
to enter into service agreements, on terms deemed desirable by any Officer,
with its direct or indirect subsidiaries, including Bank of America NT&SA, any
other banks, persons, firms, corporations and other entities whereunder
personnel and facilities will be made available by or to BAC;
Page 19 of 27 Pages
<PAGE>
(h) Interests in real or personal property
--------------------------------------
to purchase, accept, lease, sell, transfer, grant, license, release and
encumber interests, whether as security or otherwise, which BAC has or may by
such means acquire in real or personal property, whether standing in the name of
BAC as owner, as the holder of any security interest, or in any other capacity;
and, without limiting the generality of the foregoing authorization, to take all
actions and execute and deliver all documents, notices, designations,
appointments, substitutions and instructions regarding such real or personal
property, or relating thereto;
(i) General power to contract
-------------------------
in addition to the authority in subparagraphs (a) through (h) of this
paragraph 1, and whether or not of a kind generally covered therein, to enter
into contracts of any kind or character, conveyances or leases of real or
personal property, licensing agreements, contracts and agreements providing for
services to be rendered by, to or for BAC, and to execute and deliver
instruments, documents, agreements, contracts and other writings affecting in
any way any real or personal property and interests therein and contract rights
and obligations, now or hereafter owned by or standing in the name of BAC.
2. Any one BAC officer listed above under either the designation GROUP 1
or GROUP 2, or any member of the Legal Department of Bank of America NT&SA
holding the title of counsel or a title senior thereto be, and hereby is,
authorized to sign registrations, reports, certificates, applications and other
writings on behalf of BAC for submission to or filing with any federal, state,
local or foreign regulatory authorities, and any amendments, withdrawals, or
terminations thereof, as are deemed desirable by such officer or attorney in
connection with BAC's activities or affairs.
3. This resolution revokes and supersedes the General Operating and
Borrowing Resolution adopted by this Board on May 21, 1992.
Page 20 of 27 Pages
<PAGE>
CERTIFICATE
I, CHERYL SOROKIN, the Secretary of BankAmerica Corporation, a Delaware
corporation, having its principal place of business in the City and County of
San Francisco in the State of California, certify that the foregoing is a
correct copy of a resolution adopted by the Board of Directors at a meeting held
in accordance with the bylaws on November 1, 1993. This resolution is still in
effect.
/s/ CHERYL SOROKIN
-------------------------------
Secretary
BANKAMERICA CORPORATION
Dated: February 7, 1994
---------------------
Page 21 of 27 Pages
<PAGE>
ANNEX A
Identity and Background
-----------------------
The following table sets forth the names, addresses and principal
occupations of the executive officers and directors of BankAmerica (directors
are indicated by an asterisk). Each such person is a citizen of the United
States.
<TABLE>
<CAPTION>
Principal
Name Business Address Occupation
- ------------- -------------------------- -------------------------
<S> <C> <C>
*Joseph F. 10880 Wilshire Blvd. Chairman of the Board
Alibrandi Los Angeles, CA 90024 and Chief Executive
Officer, Whittaker
Corporation,
Los Angeles, CA
(principal business:
aerospace manufacturing)
*Peter B. 3658 Mount Diablo Blvd. Chairman of the Board
Bedford Lafayette, CA 94549 and Chief Executive
Officer, Bedford
Property, Inc.,
Lafayette, CA
(principal business:
real estate investment
trust)
*Andrew F. 4400 MacArthur Blvd., N.W. President, Brimmer &
Brimmer Suite 302 Company, Inc.,
Washington, D.C. 20007 Washington, D.C.
(principal business:
economic and financial
consulting)
Kathleen 555 California Street Executive Vice President
J. Burke San Francisco, CA 94104 and Personnel Relations
Officer, BankAmerica
Corporation, San
Francisco, CA
(principal business:
banking and finance)
</TABLE>
Page 22 of 27 Pages
<PAGE>
<TABLE>
<CAPTION>
Principal
Name Business Address Occupation
- ----------- ------------------------- ------------------------
<S> <C> <C>
*Richard 77 Beale Street, 32nd Fl. Chairman of the Board
A. Clarke San Francisco, CA 94106 and Chief Executive
Officer, Pacific Gas &
Electric Co.
(principal business: gas
and electric utility)
*Lewis W. 555 California St. Vice Chairman of the
Coleman San Francisco, CA 94104 Board, Chief Financial
Officer and Treasurer,
BankAmerica Corporation,
San Francisco, CA
(principal business:
banking and finance)
David A. 555 California St. Vice Chairman,
Coulter San Francisco, CA 94104 BankAmerica Corporation,
San Francisco, CA
(principal business:
banking and finance)
*Timm F. 800 North Brand Blvd. Chairman, Nestle USA,
Crull Glendale, CA 91203 Inc., Glendale, CA
(principal business:
food and related
products processing)
*Charles 235 Montgomery St., Retired Chairman and
R. Dahl Suite 826 Chief Executive Officer,
San Francisco, CA 94104 Crown Zellerbach
Corporation, San
Francisco, CA
(principal business:
forest products)
*Kathleen 147 Clifton St., President, Economics
Feldstein Belmont, MA 02178 Studies, Inc.,
Belmont, MA
(principal business:
economics consulting)
</TABLE>
Page 23 of 27 Pages
<PAGE>
<TABLE>
<CAPTION>
Principal
Name Business Address Occupation
- ----------- ------------------------- -------------------------
<S> <C> <C>
*Donald E. Pacific Telesis Center Chairman Emeritus,
Guinn 130 Kearny St., Room 3719 Pacific Telesis Group,
San Francisco, CA 94108 San Francisco, CA
(principal business:
telecommunications)
*Philip M. 444 South Flower St. Consultant and Retired
Hawley Los Angeles, CA 90071 Chairman and Chief
Executive Officer,
Carter Hawley Hale
Stores, Inc., Los
Angeles, CA
(principal business:
retailing)
Luther S. 555 California St. Vice Chairman,
Helms San Francisco, CA 94104 BankAmerica Corporation,
San Francisco, CA
(principal business:
banking and finance)
*Frank L. 2726 Shelter Island Dr. Consulting Architect,
Hope, Jr. Suite 250 San Diego, CA
San Diego, CA 92106 (principal business:
architecture)
*Lawrence 4500 Park Granada Blvd. Chairman of the
O. Kitchen Calabasas, CA 91399 Executive Committee,
Lockheed Corporation,
Calabasas, CA
(principal business:
aerospace)
*Ignacio 411 West Fifth St. Editor-in-Chief,
E. Lozano, Los Angeles, CA 90013 La Opinion, Los Angeles,
Jr. CA (principal business:
newspaper publishing)
</TABLE>
Page 24 of 27 Pages
<PAGE>
<TABLE>
<CAPTION>
Principal
Name Business Address Occupation
- ----------- ------------------------- ------------------------
<S> <C> <C>
*Cornell One Kaiser Plaza Consultant, Kaiser
C. Maier Oakland, CA 94612 Aluminum Corporation,
and Retired Chairman and
Chief Executive Officer,
Kaiser Aluminum &
Chemical Corporation,
Oakland, CA
(principal business:
aluminum)
*Walter E. University of California Provost and Senior Vice
Massey Office of the President President, Academic
300 Lakeside Drive, 22nd Affairs, University of
Fl. California, Berkeley, CA
Oakland, CA 94612 (principal business:
education)
*Ruben F. Westwood Gateway Retired Chairman of the
Mettler 11150 Santa Monica Blvd. Board and Chief Execu-
Suite 1230 tive Officer, TRW Inc.,
Los Angeles, CA 90025 Cleveland, OH
(principal business:
engineering and
manufacturing)
Jack L. 555 California St. Vice Chairman,
Meyers San Francisco, CA 94104 BankAmerica Corporation,
San Francisco, CA
(principal business:
banking and finance)
Thomas E. 555 California St. Vice Chairman,
Peterson San Francisco, CA 94104 BankAmerica Corporation,
San Francisco, CA
(principal business:
banking and finance)
</TABLE>
Page 25 of 27 Pages
<PAGE>
<TABLE>
<CAPTION>
Principal
Name Business Address Occupation
- ------------ ------------------------- --------------------------
<S> <C> <C>
*Richard M. 555 California St. Chairman of the Board,
Rosenberg San Francisco, CA 94104 President and Chief
Executive Officer,
BankAmerica Corporation,
San Francisco, CA
(principal business:
banking and finance)
Michael E. 555 California St. Vice Chairman,
Rossi San Francisco, CA 94104 BankAmerica Corporation,
San Francisco, CA
(principal business:
banking and finance)
*A. Michael Stanford University Dean, Graduate School of
Spence Memorial Way, Room 140 Business, Stanford
Stanford, CA 94305 University, Stanford, CA
(principal business:
education)
Martin A. 555 California St. Vice Chairman,
Stein San Francisco, CA 94104 BankAmerica Corporation,
San Francisco, CA
(principal business:
banking and finance)
*Jacques 1995 Agua Mansa Road Chairman and Chief
S. Yeager Riverside, CA 92509 Executive Officer, E.L.
Yeager Construction
Company, Inc.
Riverside, CA
(principal business:
heavy engineering
construction)
</TABLE>
Page 26 of 27 Pages
<PAGE>
EXHIBIT INDEX
-------------
Exhibit
- -------
(a) Agreement and Plan of Merger dated as of
January 27, 1994, between BankAmerica and
the Issuer (incorporated by reference to
Exhibit 2 to BankAmerica's Current Report
on Form 8-K filed February 3, 1994, file no.
002-45003).
(b) Stock Option Agreement dated as of
January 27, 1994, between BankAmerica and
the Issuer (incorporated by reference to
Exhibit 10 to BankAmerica's Current Report
on Form 8-K filed February 3, 1994,
file no. 002-45003).
(c) Joint Press Release dated January 28, 1994
of BankAmerica and the Issuer (incorporated
by reference to Exhibit 99 to BankAmerica's
Current Report on Form 8-K filed February 3,
1994, file no. 002-45003).
Page 27 of 27 Pages
