Exhibit 99.1
EXECUTION COPY
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AGREEMENT AND PLAN OF MERGER
by and between
FLEETBOSTON FINANCIAL CORPORATION
and
BANK OF AMERICA CORPORATION
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DATED AS OF OCTOBER 27, 2003
TABLE OF CONTENTS
ARTICLE I
THE MERGER
1.1. The Merger......................................................2
1.2 Effective Time..................................................2
1.3 Effects of the Merger...........................................2
1.4 Conversion of FleetBoston Capital Stock.........................2
1.5 Bank of America Capital Stock...................................4
1.6 Bank of America Mirror Preferred Stock..........................4
1.7 Options and SARs; Other Stock-Based Awards......................4
1.8 Certificate of Incorporation of Bank of America.................6
1.9 ByLaws of Bank of America.......................................6
1.10 Tax Consequences................................................6
1.11 Certain Post-Closing Matters....................................6
ARTICLE II
EXCHANGE OF SHARES
2.1 Bank of America to Make Shares Available........................7
2.2 Exchange of Shares..............................................7
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF FLEETBOSTON
3.1 Corporate Organization.........................................10
3.2 Capitalization.................................................11
3.3 Authority; No Violation........................................12
3.4 Consents and Approvals.........................................13
3.5 Reports........................................................14
3.6 Financial Statements...........................................14
3.7 Broker's Fees..................................................15
3.8 Absence of Certain Changes or Events...........................15
3.9 Legal Proceedings..............................................15
3.10 Taxes and Tax Returns..........................................15
3.11 Employees......................................................16
3.12 SEC Reports....................................................18
3.13 Compliance with Applicable Law.................................18
3.14 Certain Contracts..............................................19
3.15 Agreements with Regulatory Agencies............................19
3.16 Interest Rate Risk Management Instruments......................20
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3.17 Undisclosed Liabilities........................................20
3.18 Environmental Liability........................................20
3.19 State Takeover Laws; FleetBoston Rights Agreement..............20
3.20 Reorganization.................................................21
3.21 Opinions.......................................................21
3.22 FleetBoston Information........................................21
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BANK OF AMERICA
4.1 Corporate Organization.........................................22
4.2 Capitalization.................................................22
4.3 Authority, No Violation........................................23
4.4 Consents and Approvals.........................................24
4.5 Reports........................................................25
4.6 Financial Statements...........................................25
4.7 Broker's Fees..................................................26
4.8 Absence of Certain Changes or Events...........................26
4.9 Legal Proceedings..............................................26
4.10 Taxes and Tax Returns..........................................26
4.11 SEC Reports....................................................27
4.12 Compliance with Applicable Law.................................27
4.13 Agreements with Regulatory Agencies............................28
4.14 Interest Rate Risk Management Instruments......................28
4.15 Undisclosed Liabilities........................................29
4.16 Environmental Liability........................................29
4.17 State Takeover Laws............................................29
4.18 Reorganization.................................................29
4.19 Opinions.......................................................29
4.20 Bank of America Information....................................30
ARTICLE V
COVENANTS RELATING TO CONDUCT OF BUSINESS
5.1 Conduct of Businesses Prior to the Effective Time..............30
5.2 FleetBoston Forbearances.......................................30
5.3 Bank of America Forbearances...................................33
ARTICLE VI
ADDITIONAL AGREEMENTS
6.1 Regulatory Matters.............................................33
6.2 Access to Information..........................................34
6.3 Shareholder Approvals..........................................35
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6.4 Legal Conditions to Merger.....................................35
6.5 Affiliates.....................................................35
6.6 NYSE Listing...................................................36
6.7 Employee Matters...............................................36
6.8 Indemnification; Directors' and Officers' Insurance............37
6.9 Additional Agreements..........................................38
6.10 Advice of Changes..............................................38
6.11 Dividends......................................................38
6.12 Exemption from Liability Under Section 16(b)...................38
6.13 No Solicitation................................................39
6.14 Restructuring Efforts..........................................41
ARTICLE VII
CONDITIONS PRECEDENT
7.1 Conditions to Each Party's Obligation To Effect the Merger.....41
7.2 Conditions to Obligations of Bank of America...................42
7.3 Conditions to Obligations of FleetBoston.......................43
ARTICLE VIII
TERMINATION AND AMENDMENT
8.1 Termination....................................................43
8.2 Effect of Termination..........................................44
8.3 Amendment......................................................44
8.4 Extension; Waiver..............................................45
ARTICLE IX
GENERAL PROVISIONS
9.1 Closing........................................................45
9.2 Standard.......................................................45
9.3 Nonsurvival of Representations, Warranties and Agreements......46
9.4 Expenses.......................................................46
9.5 Notices........................................................46
9.6 Interpretation.................................................47
9.7 Counterparts...................................................47
9.8 Entire Agreement...............................................47
9.9 Governing Law..................................................47
9.10 Publicity......................................................48
9.11 Assignment; Third Party Beneficiaries..........................48
Exhibit A - FleetBoston Stock Option Agreement
Exhibit B - Bank of America Stock Option Agreement
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Exhibit C - Form of Affiliate Letter
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INDEX OF DEFINED TERMS
Section
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Acquisition Proposal.......................................... 6.13(a)
Agreement..................................................... Preamble
Alternative Transaction....................................... 6.13(a)
Articles of Merger............................................ 1.2
Assumed SAR................................................... 1.7(a)
Assumed Stock-Based Award..................................... 1.7(b)
Assumed Stock Option.......................................... 1.7(a)
Bank of America............................................... Preamble
Bank of America 10-Q.......................................... 4.6
Bank of America Capital Stock................................. 1.5
Bank of America Certificate................................... 4.1(a)
Bank of America Common Stock.................................. 1.4(a)
Bank of America Convertible Preferred......................... 4.2(a)
Bank of America Disclosure Schedule........................... Art. IV
Bank of America Mirror Preferred Stock........................ 1.4(b)
Bank of America Preferred Stock............................... 4.2(a)
Bank of America Regulatory Agreement.......................... 4.13
Bank of America Reports....................................... 4.11
Bank of America Stock Plans................................... 4.2(a)
Bank of America Subsidiary.................................... 3.1(c)
Bank of America 2002 10-K..................................... 4.6
Benefits Transition Date...................................... 6.7(a)
BHC Act....................................................... 3.1(b)
Certificate................................................... 1.4(c)
Certificate of Merger......................................... 1.2
Closing....................................................... 9.1
Closing Date.................................................. 9.1
Code.......................................................... Recitals
Confidentiality Agreement..................................... 6.2(b)
Convertible Note Agreement.................................... 3.2
Covered Employees............................................. 6.7(a)
DGLC.......................................................... 1.1(a)
DPC Common Shares............................................. 1.4(a)
DPC Preferred Shares.......................................... 1.4(b)
DPC Shares.................................................... 1.4(b)
Effective Time................................................ 1.2
ERISA......................................................... 3.11(c)
Exchange Act.................................................. 3.6
Exchange Agent................................................ 2.1
Exchange Fund................................................. 2.1
Exchange Ratio................................................ 1.4(a)
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Federal Reserve Board......................................... 3.4
FleetBoston................................................... Preamble
FleetBoston 10-Q.............................................. 3.6
FleetBoston Articles.......................................... 3.1(b)
FleetBoston Benefit Plans..................................... 3.11(a)
FleetBoston Bylaws............................................ 3.1(b)
FleetBoston Capital Stock..................................... 1.4(b)
FleetBoston Common Stock...................................... 1.4(a)
FleetBoston Contract.......................................... 3.14
FleetBoston Disclosure Schedule............................... Art. III
FleetBoston DRIP.............................................. 1.7(d)
FleetBoston ERISA Affiliate................................... 3.11(c)
FleetBoston ESPP.............................................. 1.7(d)
FleetBoston Insiders.......................................... 6.12
FleetBoston Preferred Stock................................... 3.2
FleetBoston Regulatory Agreement.............................. 3.15
FleetBoston Reports........................................... 3.12
FleetBoston Rights Agreement.................................. 1.4(a)
FleetBoston SAR............................................... 1.7(a)
FleetBoston Stock-Based Award................................. 1.7(b)
FleetBoston Stock Plans....................................... 1.7(a)
FleetBoston Stock Purchase Plans.............................. 1.7(d)
FleetBoston Stock Option...................................... 1.7(a)
FleetBoston Shareholder Rights................................ 1.4(a)
FleetBoston Subsidiary........................................ 3.1(c)
XxxxxXxxxxx 0000 10-K......................................... 3.6
Form S-4...................................................... 3.4
GAAP.......................................................... 3.1(c)
Governmental Entity........................................... 3.4
HSR Act....................................................... 3.4
Indemnified Parties........................................... 6.8
Injunction.................................................... 7.1(e)
IRS........................................................... 3.10(a)
Joint Proxy Statement......................................... 3.4
Liens......................................................... 3.2(b)
Material Adverse Effect....................................... 3.1(a)
Merger........................................................ Recitals
Merger Consideration.......................................... 1.1(b)
NYSE.......................................................... 2.2(e)
Other Regulatory Approvals.................................... 3.4
Regulatory Agencies........................................... 3.5
Requisite Regulatory Approvals................................ 7.1(c)
RIBCA......................................................... 1.1(a)
SBA........................................................... 3.4
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SEC........................................................... 3.4
Section 16 Information........................................ 6.12
Securities Act................................................ 3.12
SRO........................................................... 3.4
Stock Option Agreements....................................... Recitals
Subsidiary.................................................... 3.1(c)
Surviving Corporation......................................... Recitals
Takeover Statute.............................................. 3.19(a)
Tax(es)....................................................... 3.10(b)
Trust Account Common Shares................................... 1.4(a)
Trust Account Preferred Shares................................ 1.4(b)
Trust Account Shares.......................................... 1.4(b)
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AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated as of October 27, 2003
(this "Agreement"), by and between FLEETBOSTON FINANCIAL CORPORATION, a Rhode
Island corporation ("FleetBoston"), and BANK OF AMERICA CORPORATION, a Delaware
corporation ("Bank of America").
W I T N E S S E T H:
WHEREAS, the Boards of Directors of FleetBoston and Bank of
America have determined that it is in the best interests of their respective
companies and their stockholders to consummate the strategic business
combination transaction provided for in this Agreement in which FleetBoston
will, on the terms and subject to the conditions set forth in this Agreement,
merge with and into Bank of America (the "Merger"), so that Bank of America is
the surviving corporation in the Merger (sometimes referred to in such capacity
as the "Surviving Corporation"); and
WHEREAS, for Federal income Tax purposes, it is intended that
the Merger shall qualify as a reorganization under the provisions of Section
368(a) of the Internal Revenue Code of 1986, as amended (the "Code"), and this
Agreement is intended to be and is adopted as a "plan of reorganization" for
purposes of Sections 354 and 361 of the Code; and
WHEREAS, as an inducement and condition to Bank of America's
entering into this Agreement, FleetBoston is granting to Bank of America an
option pursuant to a stock option agreement in the form set forth in Exhibit A
(the "FleetBoston Stock Option Agreement"), and as an inducement and condition
to FleetBoston's entering into this Agreement, Bank of America is granting to
FleetBoston an option pursuant to a stock option agreement in the form set forth
in Exhibit B (the "Bank of America Stock Option Agreement" and, together with
the FleetBoston Stock Option Agreement, the "Stock Option Agreements"); and
WHEREAS, the parties desire to make certain representations,
warranties and agreements in connection with the Merger and also to prescribe
certain conditions to the Merger.
NOW, THEREFORE, in consideration of the mutual covenants,
representations, warranties and agreements contained in this Agreement, and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, and intending to be legally bound hereby, the parties agree
as follows:
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ARTICLE I
THE MERGER
1.1 THE MERGER. (a) Subject to the terms and conditions of
this Agreement, in accordance with the Rhode Island Business Corporation Act
(the "RIBCA") and the Delaware General Corporation Law (the "DGCL"), at the
Effective Time, FleetBoston shall merge with and into Bank of America. Bank of
America shall be the Surviving Corporation in the Merger, and shall continue its
corporate existence under the laws of the State of Delaware. As of the Effective
Time, the separate corporate existence of FleetBoston shall cease.
(b) The parties may at any time change the method of effecting
the combination (including by providing for the merger of FleetBoston and a
wholly owned subsidiary of Bank of America) if and to the extent requested by
either party and consented to by the other party (such consent not to be
unreasonably withheld); provided, however, that no such change shall (i) alter
or change the amount or kind of consideration to be issued to holders of the
capital stock of FleetBoston as provided for in this Agreement (the "Merger
Consideration"), (ii) adversely affect the Tax treatment of FleetBoston's
shareholders as a result of receiving the Merger Consideration or the Tax
treatment of either party pursuant to this Agreement or (iii) materially impede
or delay consummation of the transactions contemplated by this Agreement.
1.2 EFFECTIVE TIME. The Merger shall become effective as set
forth in the articles of merger (the "Articles of Merger") that shall be filed
with the Secretary of State of the State of Rhode Island and the certificate of
merger (the "Certificate of Merger") that shall be filed with the Secretary of
State of the State of Delaware on the Closing Date. The term "Effective Time"
shall be the date and time when the Merger becomes effective as set forth in the
Articles of Merger and the Certificate of Merger.
1.3 EFFECTS OF THE MERGER. At and after the Effective Time,
the Merger shall have the effects set forth in Section 7-1.1-69 of the RIBCA and
Section 259 of the DGCL.
1.4 CONVERSION OF FLEETBOSTON CAPITAL STOCK. At the Effective
Time, by virtue of the Merger and without any action on the part of Bank of
America, FleetBoston or the holder of any of the following securities:
(a) Subject to Section 2.2(e), each share of the common stock,
par value $0.01 per share, of FleetBoston issued and outstanding immediately
prior to the Effective Time (together with the preferred share purchase rights
("FleetBoston Shareholder Rights") attached thereto issued pursuant to that
certain Rights Agreement dated as of August 16, 2000 (the "FleetBoston Rights
Agreement"), between FleetBoston and EquiServe, LP, as Rights Agent, the
"FleetBoston Common Stock"), except for shares of FleetBoston Common Stock owned
by FleetBoston or Bank of America (other than shares of FleetBoston Common Stock
held in trust accounts, managed accounts and the like, or otherwise held in a
fiduciary or agency capacity, that are beneficially owned by third parties (any
such shares, "Trust Account Common Shares") and other than shares of FleetBoston
Common Stock held, directly or indirectly, by FleetBoston
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or Bank of America in respect of a debt previously contracted (any such shares,
"DPC Common Shares")), shall be converted into the right to receive 0.5553 of a
share (the "Exchange Ratio") of the common stock, par value $0.01 per share, of
Bank of America (the "Bank of America Common Stock").
(b) Each share of FleetBoston Preferred Stock (as defined in
Section 3.2) (together with the FleetBoston Common Stock, the "FleetBoston
Capital Stock") issued and outstanding immediately prior to the Effective Time,
except for shares of FleetBoston Preferred Stock owned by FleetBoston or Bank of
America (other than shares of FleetBoston Preferred Stock held by FleetBoston or
Bank of America in trust accounts, managed accounts and the like, or otherwise
held in a fiduciary or agency capacity, that are beneficially owned by third
parties (any such shares, "Trust Account Preferred Shares," and together with
the Trust Account Common Shares, the "Trust Account Shares") and other than any
shares of FleetBoston Preferred Stock held by FleetBoston or Bank of America in
respect of a debt previously contracted (any such shares, "DPC Preferred
Shares," and together with the DPC Common Shares, the "DPC Shares")), shall be
converted, without any action on the part of the holder thereof, into one share
of a newly-designated series of Bank of America Preferred Stock (as defined in
Section 4.2) having the same terms (to the fullest extent possible) as the share
of FleetBoston Preferred Stock so converted (the "Bank of America Mirror
Preferred Stock").
(c) All of the shares of FleetBoston Capital Stock converted
into the right to receive Bank of America Capital Stock (as defined in Section
1.5) pursuant to this Article I shall no longer be outstanding and shall
automatically be cancelled and shall cease to exist as of the Effective Time,
and (i) each certificate previously representing any such shares of FleetBoston
Common Stock (each a "Certificate") shall thereafter represent only the right to
receive (A) a certificate representing the number of whole shares of Bank of
America Common Stock and (B) cash in lieu of fractional shares into which the
shares of FleetBoston Common Stock represented by such Certificate have been
converted pursuant to this Section 1.4 and Section 2.2(e) and (ii) each
certificate representing FleetBoston Preferred Stock shall, as of and following
the Effective Time, remain outstanding and shall continue to represent the
number of shares of Bank of America Mirror Preferred Stock into which such
FleetBoston Preferred Stock shall have been converted pursuant to Section 1.4(b)
hereof. Certificates previously representing shares of FleetBoston Common Stock
shall be exchanged for certificates representing whole shares of Bank of America
Common Stock and cash in lieu of fractional shares issued in consideration
therefor upon the surrender of such Certificates in accordance with Section 2.2,
without any interest thereon. If, prior to the Effective Time, the outstanding
shares of Bank of America Common Stock or FleetBoston Common Stock shall have
been increased, decreased, changed into or exchanged for a different number or
kind of shares or securities as a result of a reorganization, recapitalization,
reclassification, stock dividend, stock split, reverse stock split, or other
similar change in capitalization, an appropriate and proportionate adjustment
shall be made to the Exchange Ratio.
(d) Notwithstanding anything in the Agreement to the contrary,
at the Effective Time, all shares of FleetBoston Capital Stock that are owned by
FleetBoston or Bank of America (other than Trust Account Shares and DPC Shares)
shall be cancelled and shall cease
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to exist and no stock of Bank of America or other consideration shall be
delivered in exchange therefor.
1.5 BANK OF AMERICA CAPITAL STOCK. At and after the Effective
Time, each share of Bank of America Common Stock and each share of Bank of
America Preferred Stock (the Bank of America Common Stock and the Bank of
America Preferred Stock, the "Bank of America Capital Stock") issued and
outstanding immediately prior to the Effective Time shall remain issued and
outstanding and shall not be affected by the Merger.
1.6 BANK OF AMERICA MIRROR PREFERRED STOCK. Prior to the
Effective Time, Bank of America shall take all corporate action necessary to
designate the rights and preferences of the Bank of America Mirror Preferred
Stock.
1.7 OPTIONS AND SARs; OTHER STOCK-BASED AWARDS. (a) Effective
as of the Effective Time, each then outstanding option to purchase shares of
FleetBoston Common Stock (each a "FleetBoston Stock Option") and stock
appreciation right to purchase shares of FleetBoston Common Stock or receive a
cash payment in respect of FleetBoston Common Stock (each a "FleetBoston SAR")
granted, pursuant to the equity-based compensation plans identified on Schedule
3.11(d) (the "FleetBoston Stock Plans"), to any current or former employee or
director of, or consultant to, FleetBoston or any of its subsidiaries shall be
assumed by Bank of America and shall be converted into an option or a stock
appreciation right to purchase a number of shares of Bank of America Common
Stock (rounded to the nearest whole share) or in the case of an FleetBoston SAR
settled in cash to receive a cash payment in respect of a share of Bank of
America Common Stock (rounded to the nearest whole share) (an "Assumed Stock
Option" or "Assumed SAR", as the case may be) equal to (i) the number of shares
of FleetBoston Common Stock subject to such FleetBoston Stock Option or
FleetBoston SAR immediately prior to the Effective Time multiplied by (ii) the
Exchange Ratio; and the per share exercise price for Bank of America Common
Stock issuable (or payable in the case of a FleetBoston SAR settled in cash)
upon the exercise of such Assumed Stock Option or Assumed SAR shall be equal to
(i) the exercise price per share of FleetBoston Common Stock at which such
FleetBoston Stock Option or FleetBoston SAR was exercisable immediately prior to
the Effective Time divided by (ii) the Exchange Ratio (rounded to the nearest
whole cent); provided, however, that in the case of any FleetBoston Stock Option
to which Section 421 of the Code applies by reason of its qualification under
Section 422 of the Code, the conversion formula shall be adjusted, if necessary,
to comply with Section 424(a) of the Code. Except as otherwise provided herein,
the Assumed Stock Options and Assumed SARs shall be subject to the same terms
and conditions (including expiration date, vesting and exercise provisions) as
were applicable to the corresponding FleetBoston Stock Options and FleetBoston
SARs immediately prior to the Effective Time (but taking into account any
changes thereto, including the acceleration thereof, provided for in the
FleetBoston Stock Plans or other FleetBoston Benefit Plan or in any award
agreement thereunder by reason of this Agreement or the transactions
contemplated hereby); provided, however, that references to FleetBoston shall be
deemed to be references to Bank of America.
(b) At the Effective Time, each right of any kind, contingent
or accrued, to receive shares of FleetBoston Common Stock or benefits measured
by the value of a number of
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shares of FleetBoston Common Stock, and each award of any kind consisting of
shares of FleetBoston Common Stock, granted under the FleetBoston Stock Plans or
any other FleetBoston Benefit Plan (including restricted stock, restricted stock
units, performance stock units, deferred stock units and dividend equivalents),
other than FleetBoston Stock Options and FleetBoston SARs (each, a "FleetBoston
Stock-Based Award"), whether vested or unvested, which is outstanding or
unsatisfied immediately prior to the Effective Time, shall cease to represent a
right or award with respect to shares of FleetBoston Common Stock and shall be
converted, at the Effective Time, into a right or award with respect to shares
of Bank of America Common Stock (an "Assumed Stock-Based Award"), on the same
terms and conditions (including expiration date, vesting and exercise
provisions) as were applicable under the FleetBoston Stock-Based Awards (but
taking into account any changes thereto, including the acceleration thereof,
provided for in the FleetBoston Stock Plans or other FleetBoston Benefit Plan or
in any award agreement thereunder by reason of this Agreement or the
transactions contemplated hereby). The number of shares of Bank of America
Common Stock subject to each such Assumed Stock-Based Award shall be equal to
the number of shares of FleetBoston Common Stock subject to the FleetBoston
Stock-Based Award, multiplied by the Exchange Ratio (rounded to the nearest
whole share of Bank of America Common Stock). All dividend equivalents credited
to the account of each holder of a FleetBoston Stock-Based Award as of the
Effective Time shall remain credited to such holder's account immediately
following the Effective Time, subject to adjustment in accordance with the
foregoing.
(c) Bank of America has taken all corporate actions necessary
to reserve for issuance a sufficient number of shares of Bank of America Common
Stock upon the exercise of the Assumed Stock Options and Assumed SARs and the
settlement or distribution of the Assumed Stock-Based Awards. On or as soon as
practicable following the Closing Date (and in no event more than five business
days after the Closing Date), Bank of America shall file a registration
statement on an appropriate form or a post-effective amendment to a previously
filed registration statement under the Securities Act with respect to the
issuance of (or settlement in cash in respect of) the shares of Bank of America
Common Stock subject to the Assumed Stock Options, the Assumed SARs and the
Assumed Stock-Based Awards and shall use its reasonable efforts to maintain the
effectiveness of such registration statement or registration statements (and
maintain the current status of the prospectus or prospectuses contained therein)
for so long as such equity awards remain outstanding.
(d) FleetBoston shall take such action as is necessary to (i)
cause the exercise (as of a date that is no later than three business days prior
to the Effective Date) of each outstanding purchase right under the FleetBoston
Employee Stock Purchase Plan (the "FleetBoston ESPP"); and (ii) provide that no
further purchase period shall commence under the FleetBoston ESPP following such
date; provided, however, that such exercise and cessation of further purchase
periods shall be conditioned upon the consummation of the Merger. On such new
exercise date, FleetBoston shall apply the funds credited as of such date under
the FleetBoston ESPP within each participant's payroll withholding account to
the purchase of shares of FleetBoston Common Stock in accordance with the terms
of the FleetBoston ESPP. In addition, FleetBoston shall take such action as is
necessary to provide that as of no later than three business days prior to the
Effective Date no further shares of FleetBoston Common Stock
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will be purchased under the FleetBoston Automatic Dividend Reinvestment Plan
(the "FleetBoston DRIP" and, together with the FleetBoston ESPP, the
"FleetBoston Stock Purchase Plans"); provided, however, that such cessation of
further purchases shall be conditioned upon the consummation of the Merger.
Immediately prior to and effective as of the Effective Time and subject to the
consummation of the Merger, FleetBoston shall terminate the FleetBoston Stock
Purchase Plans.
1.8 CERTIFICATE OF INCORPORATION OF BANK OF AMERICA. At the
Effective Time, the Bank of America Certificate (as defined in Section 4.1)
shall be the certificate of incorporation of the Surviving Corporation until
thereafter amended in accordance with applicable law.
1.9 BYLAWS OF BANK OF AMERICA. At the Effective Time, the Bank
of America Bylaws shall be the Bylaws of the Surviving Corporation until
thereafter amended in accordance with applicable law.
1.10 TAX CONSEQUENCES. It is intended that the Merger shall
constitute a "reorganization" within the meaning of Section 368(a) of the Code,
and that this Agreement shall constitute a "plan of reorganization" for purposes
of Sections 354 and 361 of the Code.
1.11 CERTAIN POST-CLOSING MATTERS.
(a) Board Composition. As of the Effective Time, and
continuing for a period of at least two years following the Effective Time:
(i) the ratio of Continuing Bank of America Directors
to Continuing FleetBoston Directors serving on the Board of Directors of the
Surviving Corporation shall be maintained at 12 to 7;
(ii) all vacancies on the Board of Directors of the
Surviving Corporation created by the cessation of service of a Continuing Bank
of America Director shall be filled by a nominee proposed to the nominating
committee of the Board of Directors of the Surviving Corporation by a majority
of the remaining Continuing Bank of America Directors; and
(iii) all vacancies on the Board of Directors of the
Surviving Corporation created by the cessation of service of a Continuing
FleetBoston Director shall be filled by a nominee proposed to the nominating
committee of the Board of Directors of the Surviving Corporation by a majority
of the remaining Continuing FleetBoston Directors.
(b) Commitment to the Communities of FleetBoston. From and after
the Effective Time:
(i) The headquarters of the Surviving Corporation's
Wealth Management, Latin American, Asset Based Lending, Small Business and
Premier Banking, and Leasing businesses shall each be located in the Boston,
Massachusetts metropolitan area;
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(ii) The Surviving Corporation is committed to
maintaining current employment levels of FleetBoston in New England, it being
the intention of the Surviving Corporation to increase such employment levels
over time at a level equal to the growth in employment of the Surviving
Corporation's United States workforce; and
(iii) The Surviving Corporation will maintain
FleetBoston's annual level of charitable giving in each of New England and the
other regions within the FleetBoston footprint, respectively, at levels no less
than the levels set in 2003, it being the intention of the Surviving Corporation
to increase such giving in those areas over time in a manner equal to the growth
in the Surviving Corporation's annual charitable giving in its other principal
markets.
(c) Definition. The terms "Continuing Bank of America
Directors" and "Continuing FleetBoston Directors" shall for purposes of this
Section 1.11 mean, respectively, the directors of Bank of America or
FleetBoston, as the case may be, as of the Effective Time who were selected to
be directors of the Surviving Corporation by Bank of America or FleetBoston, as
the case may be, prior to the Effective Time, and any additional directors of
the Surviving Corporation who take office after the Effective Time who are
nominated, or proposed to the nominating committee of the Board of Directors of
the Surviving Corporation, by a majority of the Continuing Bank of America
Directors or the Continuing FleetBoston Directors, as the case may be.
(d) Survival/Adoption of Commitments. The commitments set
forth in this Section 1.11 shall survive the Effective Time as reflected in a
formal resolution of the Board of Directors of the Surviving Corporation to be
reflected in the minutes of the Surviving Corporation following the Merger.
ARTICLE II
EXCHANGE OF SHARES
2.1 BANK OF AMERICA TO MAKE SHARES AVAILABLE. At or prior to
the Effective Time, Bank of America shall deposit, or shall cause to be
deposited, with a bank or trust company Subsidiary of Bank of America, or
another bank or trust company reasonably acceptable to each of FleetBoston and
Bank of America (the "Exchange Agent"), for the benefit of the holders of
Certificates, for exchange in accordance with this Article II, certificates
representing the shares of Bank of America Common Stock, and cash in lieu of any
fractional shares (such cash and certificates for shares of Bank of America
Common Stock, together with any dividends or distributions with respect thereto,
being referred to as the "Exchange Fund"), to be issued pursuant to Section 1.4
and paid pursuant to Section 2.2(e) in exchange for outstanding shares of
FleetBoston Common Stock.
2.2 EXCHANGE OF SHARES. (a) As soon as practicable after the
Effective Time, the Exchange Agent shall mail to each holder of record of one or
more Certificates a letter of
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transmittal in customary form as reasonably agreed to by the parties (which
shall specify, among other things, that delivery shall be effected, and risk of
loss and title to the Certificates shall pass, only upon delivery of the
Certificates to the Exchange Agent) and instructions for use in effecting the
surrender of the Certificates in exchange for certificates representing the
shares of Bank of America Common Stock and any cash in lieu of fractional shares
into which the shares of FleetBoston Common Stock represented by such
Certificate or Certificates shall have been converted pursuant to this
Agreement. Upon proper surrender of a Certificate or Certificates for exchange
and cancellation to the Exchange Agent, together with such properly completed
letter of transmittal, duly executed, the holder of such Certificate or
Certificates shall be entitled to receive in exchange therefor, as applicable,
(i) a certificate representing the number of whole shares of Bank of America
Common Stock to which such holder of FleetBoston Common Stock shall have become
entitled pursuant to the provisions of Article I, (ii) a check representing the
amount of any cash in lieu of fractional shares which such holder has the right
to receive in respect of the Certificate or Certificates surrendered pursuant to
the provisions of this Article II, and (iii) a check representing the amount of
any dividends or distributions then payable pursuant to Section 2.2(b)(i), and
the Certificate or Certificates so surrendered shall forthwith be cancelled. No
interest will be paid or accrued on any cash in lieu of fractional shares or on
any unpaid dividends and distributions payable to holders of Certificates.
(b) No dividends or other distributions declared with respect
to Bank of America Common Stock shall be paid to the holder of any unsurrendered
Certificate until the holder thereof shall surrender such Certificate in
accordance with this Article II. After the surrender of a Certificate in
accordance with this Article II, the record holder thereof shall be entitled to
receive (i) the amount of dividends or other distributions with a record date
after the Effective Time theretofore paid, without any interest thereon, with
respect to the whole shares of Bank of America Common Stock represented by such
Certificate and (ii), at the appropriate payment date, the amount of dividends
or other distributions with a record date after the Effective Time but prior to
surrender and a payment date subsequent to surrender, with respect to shares of
Bank of America Common Stock represented by such Certificate.
(c) If any certificate representing shares of Bank of America
Common Stock is to be issued in a name other than that in which the Certificate
or Certificates surrendered in exchange therefor is or are registered, it shall
be a condition to the issuance thereof that the Certificate or Certificates so
surrendered shall be properly endorsed (or accompanied by an appropriate
instrument of transfer) and otherwise in proper form for transfer, and that the
person requesting such exchange shall pay to the Exchange Agent in advance any
transfer or other Taxes required by reason of the issuance of a certificate
representing shares of Bank of America Common Stock in any name other than that
of the registered holder of the Certificate or Certificates surrendered, or
required for any other reason, or shall establish to the satisfaction of the
Exchange Agent that such Tax has been paid or is not payable.
(d) After the Effective Time, there shall be no transfers on
the stock transfer books of FleetBoston of the shares of FleetBoston Capital
Stock that were issued and outstanding immediately prior to the Effective Time
other than to settle transfers of FleetBoston Common Stock that occurred prior
to the Effective Time. If, after the Effective Time, Certificates
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representing such shares are presented for transfer to the Exchange Agent, they
shall be cancelled and exchanged for certificates representing shares of Bank of
America Common Stock as provided in this Article II.
(e) Notwithstanding anything to the contrary contained in this
Agreement, no certificates or scrip representing fractional shares of Bank of
America Common Stock shall be issued upon the surrender of Certificates for
exchange, no dividend or distribution with respect to Bank of America Common
Stock shall be payable on or with respect to any fractional share, and such
fractional share interests shall not entitle the owner thereof to vote or to any
other rights of a stockholder of Bank of America. In lieu of the issuance of any
such fractional share, Bank of America shall pay to each former stockholder of
FleetBoston who otherwise would be entitled to receive such fractional share an
amount in cash (rounded to the nearest cent) determined by multiplying (i) the
average of the closing-sale prices of Bank of America Common Stock on the New
York Stock Exchange, Inc. (the "NYSE") Composite Transactions Tape as reported
by The Wall Street Journal for the five full NYSE trading days immediately
preceding the date of the Effective Time by (ii) the fraction of a share
(rounded to the nearest thousandth when expressed in decimal form) of Bank of
America Common Stock to which such holder would otherwise be entitled to receive
pursuant to Section 1.4.
(f) Any portion of the Exchange Fund that remains unclaimed by
the stockholders of FleetBoston as of the first anniversary of the Effective
Time shall be paid to Bank of America. Any former stockholders of FleetBoston
who have not theretofore complied with this Article II shall thereafter look
only to Bank of America for payment of the shares of Bank of America Common
Stock, cash in lieu of any fractional shares and any unpaid dividends and
distributions on the Bank of America Common Stock deliverable in respect of each
share of FleetBoston Common Stock, as the case may be, such stockholder holds as
determined pursuant to this Agreement, in each case, without any interest
thereon. Notwithstanding the foregoing, none of Bank of America, FleetBoston,
the Exchange Agent or any other person shall be liable to any former holder of
shares of FleetBoston Common Stock for any amount delivered in good faith to a
public official pursuant to applicable abandoned property, escheat or similar
laws.
(g) In the event any Certificate shall have been lost, stolen
or destroyed, upon the making of an affidavit of that fact by the person
claiming such Certificate to be lost, stolen or destroyed and, if reasonably
required by Bank of America, the posting by such person of a bond in such amount
as Bank of America may determine is reasonably necessary as indemnity against
any claim that may be made against it with respect to such Certificate, the
Exchange Agent will issue in exchange for such lost, stolen or destroyed
Certificate the shares of Bank of America Common Stock and any cash in lieu of
fractional shares deliverable in respect thereof pursuant to this Agreement.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF FLEETBOSTON
Except as disclosed in (x) the FleetBoston Reports (as defined
in Section 3.12) filed prior to the date hereof or (y) the disclosure schedule
(the "FleetBoston Disclosure Schedule") delivered by FleetBoston to Bank of
America prior to the execution of this Agreement (which schedule sets forth,
among other things, items the disclosure of which is necessary or appropriate
either in response to an express disclosure requirement contained in a provision
hereof or as an exception to one or more representations or warranties contained
in this Article III, or to one or more of FleetBoston's covenants contained in
Article V, provided, however, that, notwithstanding anything in this Agreement
to the contrary, (i) no such item is required to be set forth in such schedule
as an exception to a representation or warranty if its absence would not result
in the related representation or warranty being deemed untrue or incorrect under
the standard established by Section 9.2, and (ii) the mere inclusion of an item
in such schedule as an exception to a representation or warranty shall not be
deemed an admission that such item represents a material exception or material
fact, event or circumstance or that such item has had or would be reasonably
likely to have a Material Adverse Effect (as defined in Section 3.1) on
FleetBoston), FleetBoston hereby represents and warrants to Bank of America as
follows:
3.1 CORPORATE ORGANIZATION.
(a) FleetBoston is a corporation duly organized, validly
existing and in good standing under the laws of the State of Rhode Island.
FleetBoston has the corporate power and authority to own or lease all of its
properties and assets and to carry on its business as it is now being conducted,
and is duly licensed or qualified to do business in each jurisdiction in which
the nature of the business conducted by it or the character or location of the
properties and assets owned or leased by it makes such licensing or
qualification necessary, except where the failure to be so licensed or qualified
would not, either individually or in the aggregate, have a Material Adverse
Effect on FleetBoston. As used in this Agreement, the term "Material Adverse
Effect" means, with respect to Bank of America, FleetBoston or the Surviving
Corporation, as the case may be, a material adverse effect on (i) the business,
results of operations or financial condition of such party and its Subsidiaries
(as defined below) taken as a whole (provided, however, that, with respect to
this clause (i), Material Adverse Effect shall not be deemed to include effects
to the extent resulting from (a) changes, after the date hereof, in generally
accepted accounting principles or regulatory accounting requirements applicable
to banks or savings associations and their holding companies generally, (b)
changes, after the date hereof, in laws, rules or regulations of general
applicability or interpretations thereof by courts or Governmental Entities (as
defined in Section 3.4), (c) actions or omissions of Bank of America or
FleetBoston taken with the prior written consent of the other or required
hereunder, (d) changes, after the date hereof, in general economic or market
conditions affecting banks or their holding companies generally or (e) public
disclosure of the transactions contemplated hereby), or (ii) the ability of such
party to timely consummate the transactions contemplated by this Agreement.
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(b) FleetBoston is duly registered as a financial holding
company under the Bank Holding Company Act of 1956, as amended (the "BHC Act").
True and complete copies of the Restated Articles of Incorporation of
FleetBoston (the "FleetBoston Articles") and the Bylaws of FleetBoston (the
"FleetBoston Bylaws"), as in effect as of the date of this Agreement, have
previously been made available to Bank of America.
(c) Each of FleetBoston's Subsidiaries (i) is duly organized
and validly existing under the laws of its jurisdiction of organization, (ii) is
duly qualified to do business and in good standing in all jurisdictions (whether
federal, state, local or foreign) where its ownership or leasing of property or
the conduct of its business requires it to be so qualified and (iii) has all
requisite corporate power and authority to own or lease its properties and
assets and to carry on its business as now conducted, except in each of (i) -
(iii) as would not be reasonably likely to have, either individually or in the
aggregate, a Material Adverse Effect on FleetBoston. As used in this Agreement,
the word "Subsidiary" when used with respect to either party, means any bank,
corporation, partnership, limited liability company or other organization,
whether incorporated or unincorporated, that is consolidated with such party for
financial reporting purposes under U.S. generally accepted accounting principles
("GAAP"), and the terms "FleetBoston Subsidiary" and "Bank of America
Subsidiary" shall mean any direct or indirect Subsidiary of FleetBoston or Bank
of America, respectively.
3.2 CAPITALIZATION. (a) The authorized capital stock of
FleetBoston consists of 2,000,000,000 shares of FleetBoston Common Stock, of
which, as of October 24, 2003, 1,052,745,101 shares were issued and outstanding,
and 16,000,000 shares of preferred stock, $1.00 par value ("FleetBoston
Preferred Stock"), of which, as of October 24, 2003, (i) 690,000 shares were
authorized and 382,450 shares were issued and outstanding as FleetBoston Series
VI 6.75% Perpetual Preferred Stock, and (ii) 805,000 shares were authorized and
700,000 shares were issued and outstanding as Series VII 6.60% Cumulative
Preferred Stock. As of October 24, 2003, no more than 34,196,003 shares of
FleetBoston Common Stock were held in FleetBoston's treasury. As of the date
hereof, no shares of FleetBoston Capital Stock were reserved for issuance except
for (i) shares of FleetBoston Common Stock reserved for issuance upon the
exercise of FleetBoston Stock Options or FleetBoston SARs issued pursuant to the
FleetBoston Stock Plans, (ii) 186,336 shares reserved for issuance pursuant to a
convertible note agreement (the "Convertible Note Agreement"), (iii) 500,000
shares of Cumulative Participating Junior Preferred Stock, $1.00 par value,
reserved for issuance pursuant to the FleetBoston Rights Agreement and (iv)
209,496,275 shares of FleetBoston Common Stock reserved for issuance pursuant to
the FleetBoston Stock Option Agreement. All of the issued and outstanding shares
of FleetBoston Capital Stock have been duly authorized and validly issued and
are fully paid, nonassessable and free of preemptive rights, with no personal
liability attaching to the ownership thereof. As of the date of this Agreement,
except pursuant to this Agreement, the FleetBoston Stock Option Agreement, the
FleetBoston Stock Plans, the FleetBoston Rights Agreements and the Convertible
Note Agreement, FleetBoston does not have and is not bound by any outstanding
subscriptions, options, warrants, calls, commitments or agreements of any
character calling for the purchase or issuance of any shares of FleetBoston
Capital Stock or any other equity securities of FleetBoston or any securities
representing the right to purchase or otherwise receive any shares of
FleetBoston Capital Stock. FleetBoston has provided Bank of America with a list
of (i)
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the aggregate number of options outstanding under the FleetBoston Stock Plans as
of October 21, 2003 and the exercise price for such FleetBoston Stock Options
and FleetBoston SARs, (ii) the aggregate number of cash-settled SARs and
stock-settled SARs outstanding under the FleetBoston Stock Plans as of October
21, 2003 and (iii) the aggregate number of all FleetBoston Stock-Based Awards
outstanding as of October 21, 2003; since October 21, 2003 through the date
hereof, FleetBoston has not issued or awarded any options, restricted stock,
restricted stock units or SARs under the FleetBoston Stock Plans.
(b) All of the issued and outstanding shares of capital stock
or other equity ownership interests of each "significant subsidiary" (as such
term is defined under Regulation S-X of the SEC (as defined in Section 3.4)) of
FleetBoston are owned by FleetBoston, directly or indirectly, free and clear of
any material liens, pledges, charges and security interests and similar
encumbrances ("Liens"), and all of such shares or equity ownership interests are
duly authorized and validly issued and are fully paid, nonassessable (subject to
12 U.S.C. xx.xx. 55) and free of preemptive rights. No such significant
subsidiary has or is bound by any outstanding subscriptions, options, warrants,
calls, commitments or agreements of any character calling for the purchase or
issuance of any shares of capital stock or any other equity security of such
subsidiary or any securities representing the right to purchase or otherwise
receive any shares of capital stock or any other equity security of such
subsidiary.
3.3 AUTHORITY; NO VIOLATION. (a) FleetBoston has full
corporate power and authority to execute and deliver this Agreement and the
Stock Option Agreements and to consummate the transactions contemplated hereby
and thereby. The execution and delivery of this Agreement and the Stock Option
Agreements and the consummation of the transactions contemplated hereby and
thereby have been duly and validly approved by the Board of Directors of
FleetBoston. The Board of Directors of FleetBoston has determined that this
Agreement and the transactions contemplated hereby are in the best interests of
FleetBoston and its shareholders and has directed that this Agreement and the
transactions contemplated by this Agreement be submitted to FleetBoston's
stockholders for adoption at a duly held meeting of such shareholders and,
except for the approval of this Agreement and the transactions contemplated by
this Agreement by the affirmative vote of the holders of a majority of the
outstanding shares of FleetBoston Common Stock entitled to vote at such meeting,
no other corporate proceedings on the part of FleetBoston are necessary to
approve this Agreement or the Stock Option Agreements or to consummate the
transactions contemplated hereby or thereby. This Agreement and the Stock Option
Agreements have been duly and validly executed and delivered by FleetBoston and
(assuming due authorization, execution and delivery by Bank of America)
constitute the valid and binding obligations of FleetBoston, enforceable against
FleetBoston in accordance with their terms (except as may be limited by
bankruptcy, insolvency, moratorium, reorganization or similar laws affecting the
rights of creditors generally and the availability of equitable remedies).
(b) Neither the execution and delivery of this Agreement or
the Stock Option Agreements by FleetBoston nor the consummation by FleetBoston
of the transactions contemplated hereby or thereby, nor compliance by
FleetBoston with any of the terms or provisions of this Agreement or the Stock
Option Agreements, will (i) violate any provision of the FleetBoston Articles or
the FleetBoston Bylaws or (ii) assuming that the consents, approvals
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and filings referred to in Section 3.4 are duly obtained and/or made, (A)
violate any statute, code, ordinance, rule, regulation, judgment, order, writ,
decree or Injunction (as defined in 7.1(e)) applicable to FleetBoston, any of
its Subsidiaries or any of their respective properties or assets or (B) violate,
conflict with, result in a breach of any provision of or the loss of any benefit
under, constitute a default (or an event which, with notice or lapse of time, or
both, would constitute a default) under, result in the termination of or a right
of termination or cancellation under, accelerate the performance required by, or
result in the creation of any Lien upon any of the respective properties or
assets of FleetBoston or any of its Subsidiaries under, any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, deed of trust,
license, lease, agreement or other instrument or obligation to which FleetBoston
or any of its Subsidiaries is a party, or by which they or any of their
respective properties or assets may be bound or affected, except for such
violations, conflicts, breaches or defaults that are not reasonably likely to
have, either individually or in the aggregate, a Material Adverse Effect on
FleetBoston.
3.4 CONSENTS AND APPROVALS. Except for (i) the filing of
applications and notices, as applicable, with the Board of Governors of the
Federal Reserve System (the "Federal Reserve Board") under the BHC Act and the
Federal Reserve Act, as amended, and approval of such applications and notices,
(ii) the filing of any required applications or notices with any foreign or
state banking, insurance or other regulatory authorities and approval of such
applications and notices (the "Other Regulatory Approvals"), (iii) the filing
with the Securities and Exchange Commission (the "SEC") of a Joint Proxy
Statement in definitive form relating to the meetings of FleetBoston's and Bank
of America's shareholders to be held in connection with this Agreement and the
transactions contemplated by this Agreement (the "Joint Proxy Statement") and of
a registration statement on Form S-4 (the "Form S-4") in which the Joint Proxy
Statement will be included as a prospectus, and declaration of effectiveness of
the Form S-4, (iv) the filing of the Articles of Merger with the Rhode Island
Secretary pursuant to the RIBCA and the issuance by the Rhode Island Secretary
of a Certificate of Merger and the filing of the Certificate of Merger with the
Secretary of State of the State of Delaware pursuant to the DGCL, (v) any
notices to or filings with the Small Business Administration (the "SBA"), (vi)
any notices or filings under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of
1976, as amended (the "HSR Act"), (vii) any consents, authorizations, approvals,
filings or exemptions in connection with compliance with the applicable
provisions of federal and state securities laws relating to the regulation of
broker-dealers, investment advisers or transfer agents and federal commodities
laws relating to the regulation of futures commission merchants and the rules
and regulations thereunder and of any applicable industry self-regulatory
organization ("SRO"), and the rules of the NYSE, or that are required under
consumer finance, mortgage banking and other similar laws, (viii) such filings
and approvals as are required to be made or obtained under the securities or
"Blue Sky" laws of various states in connection with the issuance of the shares
of Bank of America Capital Stock pursuant to this Agreement, (ix) the approval
of this Agreement by the requisite vote of stockholders of FleetBoston and (x)
filings, if any, required as a result of the particular status of Bank of
America, no consents or approvals of or filings or registrations with any court,
administrative agency or commission or other governmental authority or
instrumentality (each a "Governmental Entity") are necessary in connection with
(A) the execution and delivery by FleetBoston of this Agreement or the Stock
Option Agreements and
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(B) the consummation by FleetBoston of the Merger and the other transactions
contemplated by this Agreement and the Stock Option Agreements.
3.5 REPORTS. FleetBoston and each of its Subsidiaries have
timely filed all reports, registrations and statements, together with any
amendments required to be made with respect thereto, that they were required to
file since January 1, 2000 with (i) the Federal Reserve Board, (ii) the Federal
Deposit Insurance Corporation, (iii) any state regulatory authority, (iv) the
SEC, (v) any foreign regulatory authority and (vi) any SRO (collectively,
"Regulatory Agencies"), and all other reports and statements required to be
filed by them since January 1, 2000, including any report or statement required
to be filed pursuant to the laws, rules or regulations of the United States, any
state, any foreign entity, or any Regulatory Agency, and have paid all fees and
assessments due and payable in connection therewith, except where the failure to
file such report, registration or statement or to pay such fees and assessments
is not reasonably likely to have, either individually or in the aggregate, a
Material Adverse Effect on FleetBoston. Except for normal examinations conducted
by a Regulatory Agency in the ordinary course of the business of FleetBoston and
its Subsidiaries, no Regulatory Agency has initiated or has pending any
proceeding or, to the knowledge of FleetBoston, investigation into the business
or operations of FleetBoston or any of its Subsidiaries since January 1, 2000,
except where such proceedings or investigation are not reasonably likely to
have, either individually or in the aggregate, a Material Adverse Effect on
FleetBoston. There (i) is no unresolved violation, criticism, or exception by
any Regulatory Agency with respect to any report or statement relating to any
examinations or inspections of FleetBoston or any of its Subsidiaries and (ii)
has been no formal or informal inquiries by, or disagreements or disputes with,
any Regulatory Agency with respect to the business, operations, policies or
procedures of FleetBoston since January 1, 2000, that are reasonably likely to
have, either individually or in the aggregate, a Material Adverse Effect on
FleetBoston.
3.6 FINANCIAL STATEMENTS. FleetBoston has previously made
available to Bank of America copies of (i) the consolidated balance sheet of
FleetBoston and its Subsidiaries as of December 31, 2000, 2001 and 2002, and the
related consolidated statements of income, changes in stockholders' equity and
cash flows for the years then ended as reported in FleetBoston's Annual Report
on Form 10-K for the fiscal year ended December 31, 2002 (the "FleetBoston 2002
10-K") filed with the SEC under the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), accompanied by the audit report of PricewaterhouseCoopers
LLP, independent public accountants with respect to FleetBoston, and (ii) the
unaudited consolidated balance sheet of FleetBoston and its Subsidiaries as of
June 30, 2002 and 2003, and the related consolidated statements of income,
changes in stockholders' equity and cash flows of the six month periods then
ended, as reported in FleetBoston's Quarterly Report on Form 10-Q for the
quarterly period ended June 30, 2003 (the "FleetBoston 10-Q"). The December 31,
2002 consolidated balance sheet of FleetBoston (including the related notes,
where applicable) fairly presents in all material respects the consolidated
financial position of FleetBoston and its Subsidiaries as of the date thereof,
and the other financial statements referred to in this Section 3.6 (including
the related notes, where applicable) fairly present in all material respects the
results of the consolidated operations and changes in stockholders' equity and
consolidated financial position of FleetBoston and its Subsidiaries for the
respective fiscal periods or as of the respective dates
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therein set forth, subject to normal year-end audit adjustments in amounts
consistent with past experience in the case of unaudited statements; each of
such statements (including the related notes, where applicable) complies in all
material respects with applicable accounting requirements and with the published
rules and regulations of the SEC with respect thereto; and each of such
statements (including the related notes, where applicable) has been prepared in
all material respects in accordance with GAAP consistently applied during the
periods involved, except, in each case, as indicated in such statements or in
the notes thereto. The books and records of FleetBoston and its Subsidiaries
have been, and are being, maintained in all material respects in accordance with
GAAP and any other applicable legal and accounting requirements and reflect only
actual transactions.
3.7 BROKER'S FEES. Neither FleetBoston nor any FleetBoston
Subsidiary nor any of their respective officers or directors has employed any
broker or finder or incurred any liability for any broker's fees, commissions or
finder's fees in connection with the Merger or related transactions contemplated
by this Agreement, other than Xxxxxx Xxxxxxx & Co., Inc., the material terms of
whose engagement have been disclosed to Bank of America.
3.8 ABSENCE OF CERTAIN CHANGES OR EVENTS. (a) Except as
publicly disclosed in the FleetBoston Reports filed prior to the date of this
Agreement, since December 31, 2002, no event or events have occurred that have
had or are reasonably likely to have, either individually or in the aggregate, a
Material Adverse Effect on FleetBoston.
(b) Except as publicly disclosed in the FleetBoston Reports
filed prior to the date of this Agreement, since December 31, 2002 through and
including the date of this Agreement, FleetBoston and its Subsidiaries have
carried on their respective businesses in all material respects in the ordinary
course.
3.9 LEGAL PROCEEDINGS. (a) None of FleetBoston or any of its
Subsidiaries is a party to any, and there are no pending or, to the best of
FleetBoston's knowledge, threatened, legal, administrative, arbitral or other
proceedings, claims, actions or governmental or regulatory investigations of any
nature against FleetBoston or any of its Subsidiaries except as would not be
reasonably likely to have, either individually or in the aggregate, a Material
Adverse Effect on FleetBoston.
(b) There is no Injunction, judgment, or regulatory
restriction (other than those of general application that apply to similarly
situated financial or bank holding companies or their Subsidiaries) imposed upon
FleetBoston, any of its Subsidiaries or the assets of FleetBoston or any of its
Subsidiaries that has had or is reasonably likely to have, either individually
or in the aggregate, a Material Adverse Effect on FleetBoston or the Surviving
Corporation.
3.10 TAXES AND TAX RETURNS. (a) Each of FleetBoston and its
Subsidiaries has duly filed all federal, state, foreign and local information
returns and Tax returns required to be filed by it on or prior to the date of
this Agreement (all such returns being accurate and complete in all material
respects) and has duly paid or made provision for the payment of all Taxes that
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have been incurred or are due or claimed to be due from it by federal, state,
foreign or local taxing authorities other than (i) Taxes that are not yet
delinquent or are being contested in good faith, have not been finally
determined and have been adequately reserved against or (ii) information
returns, Tax returns or Taxes as to which the failure to file, pay or make
provision for is not reasonably likely to have, either individually or in the
aggregate, a Material Adverse Effect on FleetBoston. The federal income Tax
returns of FleetBoston and its Subsidiaries have been examined by the Internal
Revenue Service (the "IRS") for all years to and including 1997 and any
liability with respect thereto has been satisfied or any liability with respect
to deficiencies asserted as a result of such examination is covered by adequate
reserves. There are no material disputes pending, or claims asserted, for Taxes
or assessments upon FleetBoston or any of its Subsidiaries for which FleetBoston
does not have adequate reserves. Neither FleetBoston nor any of its Subsidiaries
is a party to or is bound by any Tax sharing, allocation or indemnification
agreement or arrangement (other than such an agreement or arrangement
exclusively between or among FleetBoston and its Subsidiaries). Within the past
five years, neither FleetBoston nor any of its Subsidiaries has been a
"distributing corporation" or a "controlled corporation" in a distribution
intended to qualify under Section 355(a) of the Code. No disallowance of a
deduction under Section 162(m) of the Code for employee remuneration of any
amount paid or payable by FleetBoston or any of its Subsidiaries under any
contract, plan, program or arrangement or understanding would be reasonably
likely to have, individually or in the aggregate, a Material Adverse Effect on
FleetBoston.
(b) As used in this Agreement, the term "Tax" or "Taxes" means
(i) all federal, state, local, and foreign income, excise, gross receipts, gross
income, ad valorem, profits, gains, property, capital, sales, transfer, use,
payroll, employment, severance, withholding, duties, intangibles, franchise,
backup withholding, and other taxes, charges, levies or like assessments
together with all penalties and additions to tax and interest thereon and (ii)
any liability for Taxes described in clause (i) under Treasury Regulation
Section 1.1502-6 (or any similar provision of state, local or foreign law).
3.11 EMPLOYEES. (a) The FleetBoston Disclosure Schedule sets
forth a true and complete list of each material benefit or compensation plan,
arrangement or agreement, and any material bonus, incentive, deferred
compensation, vacation, stock purchase, stock option, severance, employment,
change of control or fringe benefit plan, program or agreement that is
maintained, or contributed to, for the benefit of current or former directors or
employees of FleetBoston and its Subsidiaries or with respect to which
FleetBoston or its Subsidiaries may, directly or indirectly, have any liability,
as of the date of this Agreement (the "FleetBoston Benefit Plans").
(b) FleetBoston has heretofore made available to Bank of
America true and complete copies of each of the FleetBoston Benefit Plans and
certain related documents, including (i) the actuarial report for such
FleetBoston Benefit Plan (if applicable) for each of the last two years and (ii)
the most recent determination letter from the IRS (if applicable) for such
FleetBoston Benefit Plan.
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(c) Except as would not reasonably be expected to have, either
individually or in the aggregate, a Material Adverse Effect on FleetBoston, (i)
each of the FleetBoston Benefit Plans has been operated and administered in all
material respects in compliance with its terms and applicable laws, including
the Employee Retirement Income Security Act of 1974, as amended ("ERISA") and
the Code, (ii) each of the FleetBoston Benefit Plans intended to be "qualified"
within the meaning of Section 401(a) of the Code is so qualified, and there are
no existing circumstances or any events that have occurred that will adversely
affect the qualified status of any such FleetBoston Benefit Plan, (iii) with
respect to each FleetBoston Benefit Plan that is subject to Title IV of ERISA,
the present value (as defined under Section 3(26) of ERISA) of accumulated
benefit obligations under such FleetBoston Benefit Plan, based upon the
actuarial assumptions used for funding purposes in the most recent actuarial
report prepared by such FleetBoston Benefit Plan's actuary with respect to such
FleetBoston Benefit Plan, did not, as of its latest valuation date, exceed the
then current value (as defined under Section 3(26) of ERISA) of the assets of
such FleetBoston Benefit Plan allocable to such accrued benefits, (iv) no
FleetBoston Benefit Plan provides benefits coverage, including death or medical
benefits coverage (whether or not insured), with respect to current or former
employees or directors of FleetBoston or its Subsidiaries beyond their
retirement or other termination of service, other than (A) coverage mandated by
applicable law, (B) death benefits or retirement benefits under any "employee
pension plan" (as such term is defined in Section 3(2) of ERISA), (C) deferred
compensation benefits accrued as liabilities on the books of FleetBoston or its
Subsidiaries, (D) benefits the full cost of which is borne by the current or
former employee or director (or his beneficiary), (E) coverage through the last
day of the calendar month in which retirement or other termination of service
occurs, or (F) medical expense reimbursement accounts, (v) no liability under
Title IV of ERISA has been incurred by FleetBoston, its Subsidiaries or any
trade or business, whether or not incorporated, all of which together with
FleetBoston would be deemed a "single employer" within the meaning of Section
4001 of ERISA (a "FleetBoston ERISA Affiliate"), that has not been satisfied in
full, and no condition exists that presents a material risk to FleetBoston, its
Subsidiaries or any FleetBoston ERISA Affiliate of incurring a liability
thereunder, (vi) no FleetBoston Benefit Plan is a "multiemployer pension plan"
(as such term is defined in Section 3(37) of ERISA), (vii) none of FleetBoston
or its Subsidiaries or, to the knowledge of FleetBoston, any other person,
including any fiduciary, has engaged in a transaction in connection with which
FleetBoston, its Subsidiaries or any FleetBoston Benefit Plan will be subject to
either a material civil penalty assessed pursuant to Section 409 or 502(i) of
ERISA or a material Tax imposed pursuant to Section 4975 or 4976 of the Code,
(viii) to the knowledge of FleetBoston there are no pending, threatened or
anticipated claims (other than routine claims for benefits) by, on behalf of or
against any of the FleetBoston Benefit Plans or any trusts related thereto and
(ix) all contributions or other amounts payable by FleetBoston or its
Subsidiaries as of the Effective Time with respect to each FleetBoston Benefit
Plan in respect of current or former plan years have been paid or accrued in
accordance with GAAP and Section 412 of the Code.
(d) Neither the execution and delivery of this Agreement nor
the consummation of the transactions contemplated by this Agreement will (either
alone or in conjunction with any other event) (i) result in any payment
(including severance, unemployment compensation, "excess parachute payment"
(within the meaning of Section 280G of the Code),
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forgiveness of indebtedness or otherwise) becoming due to any director or any
employee of FleetBoston or any of its Subsidiaries from FleetBoston or any of
its Subsidiaries under any FleetBoston Benefit Plan or otherwise, (ii) increase
any benefits otherwise payable under any FleetBoston Benefit Plan or (iii)
result in any acceleration of the time of payment or vesting of any such
benefits.
3.12 SEC REPORTS. FleetBoston has previously made available to
Bank of America an accurate and complete copy of each (a) final registration
statement, prospectus, report, schedule and definitive proxy statement filed
since January 1, 2000 by FleetBoston with the SEC pursuant to the Securities Act
of 1933, as amended (the "Securities Act"), or the Exchange Act (the
"FleetBoston Reports"), and prior to the date of this Agreement and (b)
communication mailed by FleetBoston to its shareholders since January 1, 2000
and prior to the date of this Agreement, and no such FleetBoston Report or
communication, as of the date of such FleetBoston Report or communication,
contained any untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary in order to make the
statements made therein, in light of the circumstances in which they were made,
not misleading, except that information as of a later date (but before the date
of this Agreement) shall be deemed to modify information as of an earlier date.
Since January 1, 2000, as of their respective dates, all FleetBoston Reports
filed under the Securities Act and the Exchange Act complied as to form in all
material respects with the published rules and regulations of the SEC with
respect thereto.
3.13 COMPLIANCE WITH APPLICABLE LAW. (a) FleetBoston and each
of its Subsidiaries hold all licenses, franchises, permits and authorizations
necessary for the lawful conduct of their respective businesses under and
pursuant to each, and have complied in all respects with and are not in default
in any respect under any, applicable law, statute, order, rule, regulation,
policy or guideline of any Governmental Entity relating to FleetBoston or any of
its Subsidiaries, except where the failure to hold such license, franchise,
permit or authorization or such noncompliance or default is not reasonably
likely to have, either individually or in the aggregate, a Material Adverse
Effect on FleetBoston.
(b) Except as is not reasonably likely to have, either
individually or in the aggregate, a Material Adverse Effect on FleetBoston,
FleetBoston and each FleetBoston Subsidiary have properly administered all
accounts for which it acts as a fiduciary, including accounts for which it
serves as a trustee, agent, custodian, personal representative, guardian,
conservator or investment advisor, in accordance with the terms of the governing
documents, applicable state and federal law and regulation and common law. None
of FleetBoston, any FleetBoston Subsidiary, or any director, officer or employee
of FleetBoston or of any FleetBoston Subsidiary, has committed any breach of
trust or fiduciary duty with respect to any such fiduciary account that is
reasonably likely to have, either individually or in the aggregate, a Material
Adverse Effect on FleetBoston, and, except as would not be reasonably likely to
have, either individually or in the aggregate, a Material Adverse Effect on
FleetBoston, and the accountings for each such fiduciary account are true and
correct and accurately reflect the assets of such fiduciary account.
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3.14 CERTAIN CONTRACTS. (a) Neither FleetBoston nor any of its
Subsidiaries is a party to or bound by any contract, arrangement, commitment or
understanding (whether written or oral) (i) that is a "material contract" (as
such term is defined in Item 601(b)(10) of Regulation S-K of the SEC) to be
performed after the date of this Agreement that has not been filed or
incorporated by reference in the FleetBoston Reports filed prior to the date
hereof, (ii) that materially restricts the conduct of any material line of
business by FleetBoston or upon consummation of the Merger will materially
restrict the ability of the Surviving Corporation to engage in any line of
business material to Bank of America or FleetBoston in which a financial holding
company may lawfully engage, (iii) with or to a labor union or guild (including
any collective bargaining agreement) or (iv) including any stock option plan,
stock appreciation rights plan, restricted stock plan or stock purchase plan,
any of the benefits of which will be increased, or the vesting of the benefits
of which will be accelerated, by the execution of this Agreement, the occurrence
of any shareholder approval or the consummation of any of the transactions
contemplated by this Agreement, or the value of any of the benefits of which
will be calculated on the basis of or affected by any of the transactions
contemplated by this Agreement. Each contract, arrangement, commitment or
understanding of the type described in this Section 3.14(a), whether or not set
forth in the FleetBoston Disclosure Schedule, is referred to as a "FleetBoston
Contract," and neither FleetBoston nor any of its Subsidiaries knows of, or has
received notice of, any violation of the above by any of the other parties
thereto that is reasonably likely to have, either individually or in the
aggregate, a Material Adverse Effect on FleetBoston.
(b) With such exceptions that are not reasonably likely to
have, either individually or in the aggregate, a Material Adverse Effect on
FleetBoston, (i) each FleetBoston Contract is valid and binding on FleetBoston
or any of its Subsidiaries, as applicable, and is in full force and effect, (ii)
FleetBoston and each of its Subsidiaries has in all material respects performed
all obligations required to be performed by it to date under each FleetBoston
Contract, and (iii) no event or condition exists that constitutes or, after
notice or lapse of time or both, will constitute, a material default on the part
of FleetBoston or any of its Subsidiaries under any such FleetBoston Contract.
3.15 AGREEMENTS WITH REGULATORY AGENCIES. Neither FleetBoston
nor any of its Subsidiaries is subject to any cease-and-desist or other order or
enforcement action issued by, or is a party to any written agreement, consent
agreement or memorandum of understanding with, or is a party to any commitment
letter or similar undertaking to, or is subject to any order or directive by, or
has been ordered to pay any civil money penalty by, or has been since January 1,
2000, a recipient of any supervisory letter from, or since January 1, 2000, has
adopted any policies, procedures or board resolutions at the request or
suggestion of any Regulatory Agency or other Governmental Entity that currently
restricts in any material respect the conduct of its business or that in any
material manner relates to its capital adequacy, its ability to pay dividends,
its credit or risk management policies, its management or its business, other
than those of general application that apply to similarly situated financial
holding companies or their Subsidiaries (each item in this sentence, whether or
not set forth in the FleetBoston Disclosure Schedule, a "FleetBoston Regulatory
Agreement"), nor has FleetBoston or any of its Subsidiaries been advised since
January 1, 2000 by any Regulatory Agency or other Governmental Entity that
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it is considering issuing, initiating, ordering, or requesting any such
FleetBoston Regulatory Agreement.
3.16 INTEREST RATE RISK MANAGEMENT INSTRUMENTS. Except as
would not be reasonably likely to have, either individually or in the aggregate,
a Material Adverse Effect on FleetBoston, (1) all interest rate swaps, caps,
floors and option agreements and other interest rate risk management
arrangements, whether entered into for the account of FleetBoston or for the
account of a customer of FleetBoston or any of its Subsidiaries, were entered
into in the ordinary course of business consistent with past practice and in
accordance with prudent banking practice and applicable rules, regulations and
policies of any Regulatory Authority and with counterparties believed to be
financially responsible at the time and are legal, valid and binding obligations
of FleetBoston or one of its Subsidiaries enforceable against it in accordance
with their terms (except as may be limited by bankruptcy, insolvency,
moratorium, reorganization or similar laws affecting the rights of creditors
generally and the availability of equitable remedies), and are in full force and
effect, (2) its Subsidiaries have duly performed their obligations thereunder to
the extent that such obligations to perform have accrued, and, (3) to
FleetBoston's knowledge, there are no breaches, violations or defaults or
allegations or assertions of such by any party thereunder.
3.17 UNDISCLOSED LIABILITIES. Except for those liabilities
that are reflected or reserved against on the consolidated balance sheet of
FleetBoston included in the FleetBoston 10-Q (including any notes thereto) and
for liabilities incurred in the ordinary course of business consistent with past
practice since June 30, 2003, since such date, neither FleetBoston nor any of
its Subsidiaries has incurred any liability of any nature whatsoever (whether
absolute, accrued, contingent or otherwise and whether due or to become due)
that has had or is reasonably likely to have, either individually or in the
aggregate, a Material Adverse Effect on FleetBoston.
3.18 ENVIRONMENTAL LIABILITY. There are no legal,
administrative, arbitral or other proceedings, claims, actions, causes of
action, private environmental investigations or remediation activities or
governmental investigations of any nature seeking to impose, or that are
reasonably likely to result in the imposition, on FleetBoston of any liability
or obligation arising under common law or under any local, state or federal
environmental statute, regulation or ordinance including the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended,
pending or threatened against FleetBoston, which liability or obligation is
reasonably likely to have, either individually or in the aggregate, a Material
Adverse Effect on FleetBoston. To the knowledge of FleetBoston, there is no
reasonable basis for any such proceeding, claim, action or governmental
investigation that would impose any liability or obligation that would be
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on FleetBoston. FleetBoston is not subject to any agreement, order,
judgment, decree, letter or memorandum by or with any Governmental Entity or
third party imposing any liability or obligation with respect to the foregoing
that is reasonably likely to have, either individually or in the aggregate, a
Material Adverse Effect on FleetBoston.
3.19 STATE TAKEOVER LAWS; FLEETBOSTON RIGHTS AGREEMENT. (a)
The Board of Directors of FleetBoston has approved this Agreement and the
FleetBoston Stock Option
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Agreement and the transactions contemplated hereby and thereby as required to
render inapplicable to such agreements and transactions the Rhode Island
Business Combination Act of 1990, as amended, Article Ninth of the FleetBoston
Articles, the FleetBoston Rights Agreement and, to the knowledge of FleetBoston,
any similar "takeover" or "interested stockholder" law (any such laws, "Takeover
Statutes").
(b) FleetBoston has taken all action, if any, necessary or
appropriate so that the entering into of this Agreement and the FleetBoston
Stock Option Agreement, and the consummation of the transactions contemplated
hereby and thereby do not and will not result in the ability of any person to
exercise any Rights (as defined in the FleetBoston Rights Agreement) under the
FleetBoston Rights Agreement or enable or require any Rights to separate from
the shares of FleetBoston Common Stock to which they are attached or to be
triggered or become exercisable. No "Distribution Date" or "Stock Acquisition
Date" (as such terms are defined in the FleetBoston Rights Agreement) has
occurred.
3.20 REORGANIZATION. As of the date of this Agreement,
FleetBoston is not aware of any fact or circumstance that could reasonably be
expected to prevent the Merger from qualifying as a "reorganization" within the
meaning of Section 368(a) of the Code.
3.21 OPINIONS. Prior to the execution of this Agreement,
FleetBoston has received an opinion from Xxxxxx Xxxxxxx & Co., Inc. to the
effect that as of the date thereof and based upon and subject to the matters set
forth therein, the Exchange Ratio is fair to the stockholders of FleetBoston
from a financial point of view. Such opinion has not been amended or rescinded
as of the date of this Agreement.
3.22 FLEETBOSTON INFORMATION. The information relating to
FleetBoston and its Subsidiaries that is provided by FleetBoston or its
representatives for inclusion in the Joint Proxy Statement and the Form S-4, or
in any other document filed with any other Regulatory Agency in connection with
the transactions contemplated by this Agreement, will not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein, in light of the circumstances in which they are made,
not misleading. The Joint Proxy Statement (except for such portions thereof that
relate only to Bank of America or any of its Subsidiaries) will comply in all
material respects with the provisions of the Exchange Act and the rules and
regulations thereunder.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BANK OF AMERICA
Except as disclosed in (x) the Bank of America Reports (as
defined in Section 4.11) filed prior to the date hereof or (y) the disclosure
schedule (the "Bank of America Disclosure Schedule") delivered by Bank of
America to FleetBoston prior to the execution of this Agreement (which schedule
sets forth, among other things, items the disclosure of which is necessary or
appropriate either in response to an express disclosure requirement contained in
a
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provision hereof or as an exception to one or more representations or warranties
contained in this Article IV, or to one or more of Bank of America's covenants
contained in Article V, provided, however, that, notwithstanding anything in
this Agreement to the contrary, (i) no such item is required to be set forth in
such schedule as an exception to a representation or warranty if its absence
would not result in the related representation or warranty being deemed untrue
or incorrect under the standard established by Section 9.2, and (ii) the mere
inclusion of an item in such schedule as an exception to a representation or
warranty shall not be deemed an admission that such item represents a material
exception or material fact, event or circumstance or that such item has had or
would be reasonably likely to have a Material Adverse Effect on Bank of
America), Bank of America hereby represents and warrants to FleetBoston as
follows:
4.1 CORPORATE ORGANIZATION. (a) Bank of America is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware. Bank of America has the corporate power and authority
to own or lease all of its properties and assets and to carry on its business as
it is now being conducted, and is duly licensed or qualified to do business in
each jurisdiction in which the nature of the business conducted by it or the
character or location of the properties and assets owned or leased by it makes
such licensing or qualification necessary, except where the failure to be so
licensed or qualified would not be reasonably likely to have, either
individually or in the aggregate, a Material Adverse Effect on Bank of America.
Bank of America is duly registered as a financial holding company under the BHC
Act. True and complete copies of the Amended and Restated Certificate of
Incorporation (the "Bank of America Certificate") and Bylaws of Bank of America,
as in effect as of the date of this Agreement, have previously been made
available to FleetBoston.
(b) Each Bank of America Subsidiary (i) is duly organized and
validly existing under the laws of its jurisdiction of organization, (ii) is
duly qualified to do business and in good standing in all jurisdictions (whether
Federal, state, local or foreign) where its ownership or leasing of property or
the conduct of its business requires it to be so qualified, and (iii) has all
requisite corporate power and authority to own or lease its properties and
assets and to carry on its business as now conducted, except in each of (i) -
(iii) as would not be reasonably likely to have, either individually or in the
aggregate, a Material Adverse Effect on Bank of America.
4.2 CAPITALIZATION. (a) The authorized capital stock of Bank
of America consists of 5,000,000,000 shares of Bank of America Common Stock, of
which, as of October 24, 2003, 1,494,346,458 shares were issued and outstanding,
and 100,000,000 shares of preferred stock, $0.01 par value (the "Bank of America
Preferred Stock"), of which, as of October 24, 2003, 1,274,600 shares were
issued and outstanding. As of October 24, 2003, no more than 2,000,000 shares of
Bank of America Common Stock were held in Bank of America's treasury. As October
24, 2003, no shares of Bank of America Common Stock or Bank of America Preferred
Stock were reserved for issuance, except for (A) 329,460,493 shares reserved for
issuance upon exercise of options issued pursuant to employee and director stock
plans of Bank of America in effect as of the date of this Agreement (the "Bank
of America Stock Plans") and shares reserved for issuance pursuant to Bank of
America's ESOP Convertible Preferred Stock, Series C (the "Bank of America
Convertible Preferred") and (B) 297,374,945 shares reserved for issuance
pursuant to the Bank of America Stock Option Agreement. All of the
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issued and outstanding shares of Bank of America Capital Stock have been duly
authorized and validly issued and are fully paid, nonassessable and free of
preemptive rights, with no personal liability attaching to the ownership
thereof. As of October 24, 2003, except pursuant to this Agreement, the Bank of
America Stock Option Agreement, the Bank of America Stock Plans, the Bank of
America Convertible Preferred, stock repurchase plans entered into by Bank of
America from time to time and put options sold by Bank of America on Bank of
America Common Stock pursuant to a program designed to partially offset the cost
of Bank of America share repurchases, Bank of America does not have and is not
bound by any outstanding subscriptions, options, warrants, calls, commitments or
agreements of any character calling for the purchase or issuance of any shares
of Bank of America Capital Stock or any other equity securities of Bank of
America or any securities representing the right to purchase or otherwise
receive any shares of Bank of America Capital Stock. The shares of Bank of
America Common Stock to be issued pursuant to the Merger will be duly authorized
and validly issued and, at the Effective Time, all such shares will be fully
paid, nonassessable and free of preemptive rights, with no personal liability
attaching to the ownership thereof.
(b) All of the issued and outstanding shares of capital stock
or other equity ownership interests of each "significant subsidiary" (as such
term is defined under Regulation S-X of the SEC (as defined in Section 3.4)) of
Bank of America are owned by Bank of America, directly or indirectly, free and
clear of any Liens, and all of such shares or equity ownership interests are
duly authorized and validly issued and are fully paid, nonassessable (subject to
12 U.S.C. xx.xx. 55) and free of preemptive rights. No such significant
subsidiary has or is bound by any outstanding subscriptions, options, warrants,
calls, commitments or agreements of any character calling for the purchase or
issuance of any shares of capital stock or any other equity security of such
subsidiary or any securities representing the right to purchase or otherwise
receive any shares of capital stock or any other equity security of such
subsidiary.
4.3 AUTHORITY; NO VIOLATION. (a) Bank of America has full
corporate power and authority to execute and deliver this Agreement and the
Stock Option Agreements and to consummate the transactions contemplated hereby
and thereby. The execution and delivery of this Agreement and the Stock Option
Agreements and the consummation of the transactions contemplated hereby and
thereby have been duly and validly approved by the Board of Directors of Bank of
America. The Board of Directors of Bank of America has determined that this
Agreement and the transactions contemplated hereby are in the best interests of
Bank of America and its stockholders and has directed that this Agreement and
the transactions contemplated by this Agreement be submitted to Bank of
America's stockholders for adoption at a duly held meeting of such stockholders
and, except for the approval of this Agreement and the transactions contemplated
by this Agreement by the affirmative vote of the holders of a majority of the
outstanding shares of FleetBoston Common Stock entitled to vote at such meeting,
no other corporate proceedings on the part of Bank of America are necessary to
approve this Agreement or the Stock Option Agreements to consummate the
transactions contemplated hereby or thereby. This Agreement and the Stock Option
Agreements have been duly and validly executed and delivered by Bank of America
and (assuming due authorization, execution and delivery by FleetBoston)
constitute the valid and binding obligations of Bank of America, enforceable
against Bank of America in accordance with their terms (except as may be limited
by
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bankruptcy, insolvency, moratorium, reorganization or similar laws affecting
the rights of creditors generally and the availability of equitable remedies).
(b) Neither the execution and delivery of this Agreement or
the Stock Option Agreements by Bank of America, nor the consummation by Bank of
America of the transactions contemplated hereby or thereby, nor compliance by
Bank of America with any of the terms or provisions of this Agreement or the
Stock Option Agreements, will (i) violate any provision of the Bank of America
Certificate or the Bank of America Bylaws, or (ii) assuming that the consents,
approvals and filings referred to in Section 4.4 are duly obtained and/or made,
(A) violate any statute, code, ordinance, rule, regulation, judgment, order,
writ, decree or Injunction applicable to Bank of America, any of its
Subsidiaries or any of their respective properties or assets or (B) violate,
conflict with, result in a breach of any provision of or the loss of any benefit
under, constitute a default (or an event which, with notice or lapse of time, or
both, would constitute a default) under, result in the termination of or a right
of termination or cancellation under, accelerate the performance required by, or
result in the creation of any Lien upon any of the respective properties or
assets of Bank of America or any of its Subsidiaries under, any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, deed of trust,
license, lease, agreement or other instrument or obligation to which Bank of
America or any of its Subsidiaries is a party, or by which they or any of their
respective properties or assets may be bound or affected, except for such
violations, conflicts, breaches or defaults that are not reasonably likely to
have, either individually or in the aggregate, a Material Adverse Effect on Bank
of America.
4.4 CONSENTS AND APPROVALS. Except for (i) the filing of
applications and notices, as applicable, with the Federal Reserve Board under
the BHC Act and the Federal Reserve Act, as amended, and approval of such
applications and notices, (ii) the Other Regulatory Approvals, (iii) the filing
with the SEC of the Joint Proxy Statement and the filing and declaration of
effectiveness of the Form S-4, (iv) the filing of the Articles of Merger with
the Rhode Island Secretary pursuant to the RIBCA and the issuance by the Rhode
Island Secretary of a Certificate of Merger and the filing of the Certificate of
Merger with the Secretary of State of the State of Delaware pursuant to the
DGCL, (v) any notices to or filings with the SBA, (vi) any notices or filings
under the HSR Act, (vii) any consents, authorizations, approvals, filings or
exemptions in connection with compliance with the applicable provisions of
federal and state securities laws relating to the regulation of broker-dealers,
investment advisers or transfer agents, and federal commodities laws relating to
the regulation of futures commission merchants and the rules and regulations
thereunder and of any applicable SRO, and the rules of the NYSE, or that are
required under consumer finance, mortgage banking and other similar laws, (viii)
such filings and approvals as are required to be made or obtained under the
securities or "Blue Sky" laws of various states in connection with the issuance
of the shares of Bank of America Capital Stock pursuant to this Agreement, (ix)
the approval of this Agreement by the requisite vote of stockholders of Bank of
America and (x) filings, if any, required as a result of the particular status
of FleetBoston, no consents or approvals of or filings or registrations with any
Governmental Entity are necessary in connection with (A) the execution and
delivery by Bank of America of this Agreement or the Stock Option Agreements and
(B) the consummation by Bank
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of America of the Merger and the other transactions contemplated by this
Agreement and the Stock Option Agreements.
4.5 REPORTS. Bank of America and each of its Subsidiaries have
timely filed all reports, registrations and statements, together with any
amendments required to be made with respect thereto, that they were required to
file since January 1, 2000 with the Regulatory Agencies, and all other reports
and statements required to be filed by them since January 1, 2000, including any
report or statement required to be filed pursuant to the laws, rules or
regulations of the United States, any state, any foreign entity, or any
Regulatory Agency, and have paid all fees and assessments due and payable in
connection therewith, except where the failure to file such report, registration
or statement or to pay such fees and assessments is not reasonably likely to
have, either individually or in the aggregate, a Material Adverse Effect on Bank
of America. Except for normal examinations conducted by a Regulatory Agency in
the ordinary course of the business of Bank of America and its Subsidiaries, no
Regulatory Agency has initiated or has pending any proceeding or, to the
knowledge of Bank of America, investigation into the business or operations of
Bank of America or any of its Subsidiaries since January 1, 2000, except where
such proceedings or investigation are not reasonably likely to have, either
individually or in the aggregate, a Material Adverse Effect on Bank of America.
There (i) is no unresolved violation, criticism, or exception by any Regulatory
Agency with respect to any report or statement relating to any examinations or
inspections of Bank of America or any of its Subsidiaries, and (ii) has been no
formal or informal inquiries by, or disagreements or disputes with, any
Regulatory Agency with respect to the business, operations, policies or
procedures of Bank of America since January 1, 2000, that are reasonably likely
to have, either individually or in the aggregate, a Material Adverse Effect on
Bank of America.
4.6 FINANCIAL STATEMENTS. Bank of America has previously made
available to FleetBoston copies of (i) the consolidated balance sheet of Bank of
America and its Subsidiaries as of December 31, 2000, 2001 and 2002, and the
related consolidated statements of income, changes in shareholders' equity and
cash flows for the years then ended as reported in Bank of America's Annual
Report on Form 10-K for the fiscal year ended December 31, 2002 (the "Bank of
America 2002 10-K") filed with the SEC under the Exchange Act, accompanied by
the audit report of PricewaterhouseCoopers LLP, independent public accountants
with respect to Bank of America, and (ii) the unaudited consolidated balance
sheet of Bank of America and its Subsidiaries as of June 30, 2002 and 2003, and
the related consolidated statements of income, changes in shareholders' equity
and cash flows of the six month periods then ended, as reported in Bank of
America's Quarterly Report on Form 10-Q for the quarterly period ended June 30,
0000 (xxx "Xxxx xx Xxxxxxx 00-X"). The December 31, 2002 consolidated balance
sheet of Bank of America (including the related notes, where applicable) fairly
presents in all material respects the consolidated financial position of Bank of
America and its Subsidiaries as of the date thereof, and the other financial
statements referred to in this Section 4.6 (including the related notes, where
applicable) fairly present in all material respects the results of the
consolidated operations and changes in shareholders' equity and consolidated
financial position of Bank of America and its Subsidiaries for the respective
fiscal periods or as of the respective dates therein set forth, subject to
normal year-end audit adjustments in amounts consistent with past experience in
the case of unaudited statements; each of such statements (including the
-25-
related notes, where applicable) complies in all material respects with
applicable accounting requirements and with the published rules and regulations
of the SEC with respect thereto; and each of such statements (including the
related notes, where applicable) has been prepared in all material respects in
accordance with GAAP consistently applied during the periods involved, except,
in each case, as indicated in such statements or in the notes thereto. The books
and records of Bank of America and its Subsidiaries have been, and are being,
maintained in all material respects in accordance with GAAP and any other
applicable legal and accounting requirements and reflect only actual
transactions.
4.7 BROKER'S FEES. Neither Bank of America nor any Bank of
America Subsidiary nor any of their respective officers or directors has
employed any broker or finder or incurred any liability for any brokers fees,
commissions or finder's fees in connection with the Merger or related
transactions contemplated by this Agreement, other than Xxxxxxx, Xxxxx & Co. and
Banc of America Securities, the material terms of whose engagement have been
disclosed to FleetBoston.
4.8 ABSENCE OF CERTAIN CHANGES OR EVENTS. (a) Except as
publicly disclosed in the Bank of America Reports (as defined in Section 4.11)
filed prior to the date of this Agreement, since December 31, 2002, no event or
events have occurred that have had or are reasonably likely to have a Material
Adverse Effect on Bank of America.
(b) Except as publicly disclosed in Bank of America Reports
filed prior to the date of this Agreement, from December 31, 2002 through and
including the date of this Agreement, Bank of America and the Bank of America
Subsidiaries have carried on their respective businesses in all material
respects in the ordinary course.
4.9 LEGAL PROCEEDINGS. (a) None of Bank of America or any of
its Subsidiaries is a party to any, and there are no pending or, to the best of
Bank of America's knowledge, threatened, legal, administrative, arbitral or
other proceedings, claims, actions or governmental or regulatory investigations
of any nature against Bank of America or any of its Subsidiaries except as would
not be reasonably likely to have, either individually or in the aggregate, a
Material Adverse Effect on Bank of America.
(b) There is no Injunction, judgment, or regulatory
restriction (other than those of general application that apply to similarly
situated financial or bank holding companies or their Subsidiaries) imposed upon
Bank of America, any of its Subsidiaries or the assets of Bank of America or any
of its Subsidiaries that has had or is reasonably likely to have, either
individually or in the aggregate, a Material Adverse Effect on Bank of America
or the Surviving Corporation.
4.10 TAXES AND TAX RETURNS. Each of Bank of America and its
Subsidiaries has duly filed all federal, state, foreign and local information
returns and Tax returns required to be filed by it on or prior to the date of
this Agreement (all such returns being accurate and complete in all material
respects) and has duly paid or made provision for the payment of all Taxes that
have been incurred or are due or claimed to be due from it by federal, state,
foreign or local
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taxing authorities other than (i) Taxes or other governmental charges that are
not yet delinquent or are being contested in good faith, have not been finally
determined and have been adequately reserved against, or (ii) information
returns, Tax returns or Taxes as to which the failure to file, pay or make
provision for is not reasonably likely to have, either individually or in the
aggregate, a Material Adverse Effect on Bank of America. The federal income Tax
returns of Bank of America and its Subsidiaries have been examined by the IRS
for all years to and including 1999 and any liability with respect thereto has
been satisfied or any liability with respect to deficiencies asserted as a
result of such examination is covered by adequate reserves. There are no
material disputes pending, or claims asserted, for Taxes or assessments upon
Bank of America or any of its Subsidiaries for which Bank of America does not
have adequate reserves. Neither Bank of America nor any of its Subsidiaries is a
party to or is bound by any Tax sharing, allocation or indemnification agreement
or arrangement (other than such an agreement or arrangement exclusively between
or among Bank of America and its Subsidiaries). Within the past five years,
neither Bank of America nor any of its Subsidiaries has been a "distributing
corporation" or a "controlled corporation" in a distribution intended to qualify
under Section 355(a) of the Code. No disallowance of a deduction under Section
162(m) of the Code for employee remuneration of any amount paid or payable by
Bank of America or any of its Subsidiaries under any contract, plan, program or
arrangement or understanding would be reasonably likely to have, individually or
in the aggregate, a Material Adverse Effect on Bank of America.
4.11 SEC REPORTS. Bank of America has previously made
available to FleetBoston an accurate and complete copy of each (a) final
registration statement, prospectus, report, schedule and definitive Joint Proxy
Statement filed since January 1, 2000 by Bank of America with the SEC pursuant
to the Securities Act or the Exchange Act (the "Bank of America Reports") and
prior to the date of this Agreement and (b) communication mailed by Bank of
America to its stockholders since January 1, 2000 and prior to the date of this
Agreement, and no such Bank of America Report or communication, as of the date
of such Bank of America Report or communication, contained any untrue statement
of a material fact or omitted to state any material fact required to be stated
therein or necessary in order to make the statements made therein, in light of
the circumstances in which they were made, not misleading, except that
information as of a later date (but before the date of this Agreement) shall be
deemed to modify information as of an earlier date. Since January 1, 2000, as of
their respective dates, all Bank of America Reports filed under the Securities
Act and the Exchange Act complied as to form in all material respects with the
published rules and regulations of the SEC with respect thereto.
4.12 COMPLIANCE WITH APPLICABLE LAW. (a) Bank of America and
each of its Subsidiaries hold all licenses, franchises, permits and
authorizations necessary for the lawful conduct of their respective businesses
under and pursuant to each, and have complied in all respects with and are not
in default in any respect under any, applicable law, statute, order, rule,
regulation, policy or guideline of any Governmental Entity relating to Bank of
America or any of its Subsidiaries, except where the failure to hold such
license, franchise, permit or authorization or such noncompliance or default is
not reasonably likely to, either individually or in the aggregate, have a
Material Adverse Effect on Bank of America.
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(b) Except as is not reasonably likely to have, either
individually or in the aggregate, a Material Adverse Effect on Bank of America,
Bank of America and each Bank of America Subsidiary have properly administered
all accounts for which it acts as a fiduciary, including accounts for which it
serves as a trustee, agent, custodian, personal representative, guardian,
conservator or investment advisor, in accordance with the terms of the governing
documents, applicable state and federal law and regulation and common law. None
of Bank of America, any Bank of America Subsidiary, or any director, officer or
employee of Bank of America or of any Bank of America Subsidiary, has committed
any breach of trust or fiduciary duty with respect to any such fiduciary account
that is reasonably likely to have, either individually or in the aggregate, a
Material Adverse Effect on Bank of America, and, except as would not be
reasonably likely to have, either individually or in the aggregate, a Material
Adverse Effect on Bank of America and the accountings for each such fiduciary
account are true and correct and accurately reflect the assets of such fiduciary
account.
4.13 AGREEMENTS WITH REGULATORY AGENCIES. Neither Bank of
America nor any of its Subsidiaries is subject to any cease-and-desist or other
order or enforcement action issued by, or is a party to any written agreement,
consent agreement or memorandum of understanding with, or is a party to any
commitment letter or similar undertaking to, or is subject to any order or
directive by, or has been since January 1, 2000, a recipient of any supervisory
letter from, or has been ordered to pay any civil money penalty by, or since
January 1, 2000, has adopted any policies, procedures or board resolutions at
the request or suggestion of any Regulatory Agency or other Governmental Entity
that currently restricts in any material respect the conduct of its business or
that in any material manner relates to its capital adequacy, its ability to pay
dividends, its credit or risk management policies, its management or its
business, other than those of general application that apply to similarly
situated financial holding companies or their Subsidiaries (each, whether or not
set forth in the Bank of America Disclosure Schedule, a "Bank of America
Regulatory Agreement"), nor has Bank of America or any of its Subsidiaries been
advised since January 1, 2000, by any Regulatory Agency or other Governmental
Entity that it is considering issuing, initiating, ordering or requesting any
such Bank of America Regulatory Agreement.
4.14 INTEREST RATE RISK MANAGEMENT INSTRUMENTS. Except as
would not be reasonably likely to have, either individually or in the aggregate,
a Material Adverse Effect on Bank of America, (1) all interest rate swaps, caps,
floors and option agreements and other interest rate risk management
arrangements, whether entered into for the account of Bank of America or for the
account of a customer of Bank of America or one of its Subsidiaries, were
entered into in the ordinary course of business consistent with past practice
and in accordance with prudent banking practice and applicable rules,
regulations and policies of any Regulatory Authority and with counterparties
believed to be financially responsible at the time and are legal, valid and
binding obligations of Bank of America or one of its Subsidiaries enforceable
against it in accordance with their terms (except as may be limited by
bankruptcy, insolvency, moratorium, reorganization or similar laws affecting the
rights of creditors generally and the availability of equitable remedies), and
are in full force and effect, (2) each of its Subsidiaries have duly performed
their obligations thereunder to the extent that such obligations to perform have
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accrued, and (3) to Bank of America's knowledge, there are no breaches,
violations or defaults or allegations or assertions of such by any party
thereunder.
4.15 UNDISCLOSED LIABILITIES. Except for those liabilities
that are reflected or reserved against on the consolidated balance sheet of Bank
of America included in the Bank of America 10-Q (including any notes thereto)
and for liabilities incurred in the ordinary course of business consistent with
past practice since June 30, 2003, since such date, neither Bank of America nor
any of its Subsidiaries has incurred any liability of any nature whatsoever
(whether absolute, accrued, contingent or otherwise and whether due or to become
due) that, either individually or in the aggregate, has had or is reasonably
likely to have, a Material Adverse Effect on Bank of America.
4.16 ENVIRONMENTAL LIABILITY. There are no legal,
administrative, arbitral or other proceedings, claims, actions, causes of
action, private environmental investigations or remediation activities or
governmental investigations of any nature seeking to impose, or that are
reasonably likely to result in the imposition, on Bank of America of any
liability or obligation arising under common law or under any local, state or
federal environmental statute, regulation or ordinance including the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended, pending or threatened against Bank of America, which liability or
obligation is reasonably likely to have, either individually or in the
aggregate, a Material Adverse Effect on Bank of America. To the knowledge of
Bank of America, there is no reasonable basis for any such proceeding, claim,
action or governmental investigation that would impose any liability or
obligation that would be reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on Bank of America. Bank of America is not
subject to any agreement, order, judgment, decree, letter or memorandum by or
with any Governmental Entity or third party imposing any liability or obligation
with respect to the foregoing that is reasonably likely to have, either
individually or in the aggregate, a Material Adverse Effect on Bank of America.
4.17 STATE TAKEOVER LAWS. The Board of Directors of Bank of
America has approved this Agreement and the Bank of America Stock Option
Agreement and the transactions contemplated hereby and thereby as required to
render inapplicable to such agreements and transactions Section 203 of the DGCL
and, to the knowledge of Bank of America, any Takeover Statutes.
4.18 REORGANIZATION. As of the date of this Agreement, Bank of
America is not aware of any fact or circumstance that could reasonably be
expected to prevent the Merger from qualifying as a "reorganization" within the
meaning of Section 368(a) of the Code.
4.19 OPINIONS. Prior to the execution of this Agreement, Bank
of America has received an opinion from Xxxxxxx, Sachs & Co. to the effect that
as of the date thereof and based upon and subject to the matters set forth
therein, the Exchange Ratio is fair to Bank of America from a financial point of
view. Such opinion has not been amended or rescinded as of the date of this
Agreement.
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4.20 BANK OF AMERICA INFORMATION. The information relating to
Bank of America and its Subsidiaries to be contained in the Joint Proxy
Statement and the Form S-4, or the information relating to Bank of America and
its Subsidiaries that is provided by Bank of America or its representatives for
inclusion in any other document filed with any other Regulatory Agency in
connection with the transactions contemplated by this Agreement, will not
contain any untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in light of the circumstances in which
they are made, not misleading. The Joint Proxy Statement (except for such
portions thereof that relate only to FleetBoston or any of its Subsidiaries)
will comply with the provisions of the Exchange Act and the rules and
regulations thereunder in all material respects. The Form S-4 will comply with
the provisions of the Securities Act and the rules and regulations thereunder in
all material respects.
ARTICLE V
COVENANTS RELATING TO CONDUCT OF BUSINESS
5.1 CONDUCT OF BUSINESSES PRIOR TO THE EFFECTIVE TIME. During
the period from the date of this Agreement to the Effective Time, except as
expressly contemplated or permitted by this Agreement (including the FleetBoston
Disclosure Schedule and the Bank of America Disclosure Schedule), each of
FleetBoston and Bank of America shall, and shall cause each of its respective
Subsidiaries to (a) conduct its business in the ordinary course in all material
respects, (b) use reasonable best efforts to maintain and preserve intact its
business organization, employees and advantageous business relationships and
retain the services of its key officers and key employees and (c) take no action
that would adversely affect or materially delay the ability of either
FleetBoston or Bank of America to obtain any necessary approvals of any
Regulatory Agency or other Governmental Entity required for the transactions
contemplated hereby or to perform its covenants and agreements under this
Agreement or to consummate the transactions contemplated hereby or thereby.
5.2 FLEETBOSTON FORBEARANCES. During the period from the date
of this Agreement to the Effective Time, except as set forth in the FleetBoston
Disclosure Schedule and except as expressly contemplated or permitted by this
Agreement, FleetBoston shall not, and shall not permit any of its Subsidiaries
to, without the prior written consent of Bank of America (which consent shall
not be unreasonably withheld):
(a) other than in the ordinary course of business consistent
with past practice, incur any indebtedness for borrowed money (other than
short-term indebtedness incurred to refinance short-term indebtedness and
indebtedness of FleetBoston or any of its wholly-owned Subsidiaries to
FleetBoston or any of its Subsidiaries), assume, guarantee, endorse or otherwise
as an accommodation become responsible for the obligations of any other
individual, corporation or other entity, or make any loan or advance (it being
understood and agreed that incurrence of indebtedness in the ordinary course of
business consistent with past practice shall include the creation of deposit
liabilities, purchases of Federal funds, sales of certificates of deposit and
entering into repurchase agreements);
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(b) (i) adjust, split, combine or reclassify any of its
capital stock;
(ii) make, declare or pay any dividend, or make any other
distribution on, or directly or indirectly redeem, purchase or otherwise
acquire, any shares of its capital stock or any securities or obligations
convertible (whether currently convertible or convertible only after the passage
of time or the occurrence of certain events) into or exchangeable for any shares
of its capital stock (except (A) for regular quarterly cash dividends at a rate
not in excess of $0.35 per share of FleetBoston Common Stock, subject to Section
6.11, (B) dividends paid by any of the Subsidiaries of FleetBoston to
FleetBoston or to any of its wholly-owned Subsidiaries, (C) dividends paid on
FleetBoston Preferred Stock outstanding on the date hereof in accordance with
the certificate of designation for such FleetBoston Preferred Stock, and (D) the
acceptance of shares of FleetBoston Common Stock as payment of the exercise
price of stock options or for withholding taxes incurred in connection with the
exercise of FleetBoston Stock Options, FleetBoston SARs or the vesting of
restricted stock or other FleetBoston Stock-Based Awards, in each case in
accordance with past practice and the terms of the applicable award agreements);
(iii) grant any stock appreciation rights or grant any
individual, corporation or other entity any right to acquire any shares of its
capital stock, other than (A) pursuant to the FleetBoston Rights Agreement or
any renewal or replacement thereof and (B) grants to newly-hired employees of
FleetBoston made in the ordinary course of business consistent with past
practice under the FleetBoston Stock Plans subject to the terms set forth on
Schedule 5.2(b); or
(iv) issue any additional shares of capital stock except (A)
pursuant to the exercise of FleetBoston Stock Options or FleetBoston SARs or the
satisfaction of any FleetBoston Stock-Based Awards, in each case, outstanding as
of the date of this Agreement or issued thereafter in compliance with this
Agreement, (B) pursuant to the Convertible Note Agreement, (C) pursuant to the
FleetBoston Stock Option Agreement, (D) pursuant to the FleetBoston Rights
Agreement or any renewal or replacement thereof or (E) pursuant to the
FleetBoston Stock Purchase Plans;
(c) (i) except for normal increases made in the ordinary
course of business consistent with past practice, or as required by applicable
law or an existing agreement, increase the wages, salaries, compensation,
pension, or other fringe benefits or perquisites payable to any officer,
employee, or director, (ii) pay any pension or retirement allowance not required
by any existing plan or agreement or by applicable law, (iii) pay any bonus
other than customary year-end bonuses for fiscal 2003 determined in the ordinary
course consistent with past practice or as required by an existing agreement,
(iv) become a party to, amend or commit itself to, any pension, retirement,
profit-sharing or welfare benefit plan or agreement or employment agreement with
or for the benefit of any employee, other than in the ordinary course of
business consistent with past practice or as required by applicable law or any
existing agreement, or (v) except as required under any existing plan, grant, or
agreement, accelerate the vesting of, or the lapsing of restrictions with
respect to, any FleetBoston Stock Options, FleetBoston SARs or other FleetBoston
Stock-Based Awards;
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(d) sell, transfer, mortgage, encumber or otherwise dispose of
any of its properties or assets that are material to FleetBoston and its
Subsidiaries, taken as a whole, to any individual, corporation or other entity
other than a Subsidiary or cancel, release or assign any indebtedness that is
material to FleetBoston and its Subsidiaries, taken as a whole, to any such
person or any claims held by any such person that are material to FleetBoston
and its Subsidiaries, taken as a whole, in each case other than in the ordinary
course of business consistent with past practice or pursuant to contracts in
force at the date of this Agreement;
(e) enter into any new line of business that is material to
FleetBoston and its Subsidiaries, taken as a whole, or change its lending,
investment, underwriting, risk and asset liability management and other banking
and operating policies that are material to FleetBoston and its Subsidiaries,
taken as a whole, except as required by applicable law, regulation or policies
imposed by any Governmental Entity;
(f) except for transactions in the ordinary course of business
consistent with past practice, make any material investment either by purchase
of stock or securities, contributions to capital, property transfers, or
purchase of any property or assets of any other individual, corporation or other
entity, provided that nothing contained in this Section 5.2(f) shall be deemed
to limit FleetBoston's ability to exercise its rights under the Bank of America
Stock Option Agreement;
(g) knowingly take any action, or knowingly fail to take any
action, which action or failure to act is reasonably likely to prevent the
Merger from qualifying as a reorganization within the meaning of Section 368(a)
of the Code;
(h) amend its articles or certificate of incorporation or
bylaws, or amend, or redeem the rights issued under, the FleetBoston Rights
Agreement (except in connection with entering into the FleetBoston Stock Option
Agreement), or otherwise take any action to exempt any person or entity (other
than Bank of America or its Subsidiaries) or any action taken by any person or
entity from the FleetBoston Rights Agreement or any Takeover Statute or
similarly restrictive provisions of its organizational documents or terminate,
amend or waive any provisions of any confidentiality or standstill agreements in
place with any third parties;
(i) other than in prior consultation with Bank of America,
restructure or materially change its investment securities portfolio or its gap
position, through purchases, sales or otherwise, or the manner in which the
portfolio is classified or reported;
(j) settle any material claim, action or proceeding, except in
the ordinary course of business consistent with past practice;
(k) take any action that is intended or is reasonably likely
to result in any of its representations or warranties set forth in this
Agreement being or becoming untrue in any material respect at any time prior to
the Effective Time, or in any of the conditions to the Merger set forth in
Article VII not being satisfied or in a violation of any provision of this
Agreement, except, in every case, as may be required by applicable law;
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(l) implement or adopt any change in its tax accounting or
financial accounting principles, practices or methods, other than as may be
required by applicable law, GAAP or regulatory guidelines;
(m) take any action that would materially impede or delay the
ability of the parties to obtain any necessary approvals of any Regulatory
Agency or Governmental Entity required for the transactions contemplated by this
Agreement; or
(n) agree to take, make any commitment to take, or adopt any
resolutions of its board of directors in support of, any of the actions
prohibited by this Section 5.2.
5.3 BANK OF AMERICA FORBEARANCES. During the period from the
date of this Agreement to the Effective Time, except as expressly contemplated
or permitted by this Agreement, Bank of America shall not, and shall not permit
any of its Subsidiaries to, without the prior written consent of FleetBoston
(which consent shall not be unreasonably withheld), (i) amend, repeal or
otherwise modify any provision of the Bank of America Articles or the Bank of
America Bylaws, (ii) knowingly take any action, or knowingly fail to take any
action, which action or failure to act is reasonably likely to prevent the
Merger from qualifying as a reorganization within the meaning of Section 368(a)
of the Code, (iii) take any action that would materially impede or delay the
ability of the parties to obtain any necessary approvals of any Regulatory
Agency or other Governmental Entity required for the transactions contemplated
hereby, (iv) take any action that is intended or is reasonably likely to result
in any of its representations or warranties set forth in this Agreement being or
becoming untrue in any material respect at any time prior to the Effective Time,
or in any of the conditions to the Merger set forth in Article VII not being
satisfied or in a violation of any provision of this Agreement, except, in every
case, as may be required by applicable law or (v) agree to take, make any
commitment to take, or adopt any resolutions of its board of directors in
support of, any of the actions prohibited by this Section 5.3.
ARTICLE VI
ADDITIONAL AGREEMENTS
6.1 REGULATORY MATTERS. (a) Bank of America and FleetBoston
shall promptly prepare and file with the SEC the Joint Proxy Statement and Bank
of America shall promptly prepare and file with the SEC the Form S-4, in which
the Joint Proxy Statement will be included as a prospectus. Each of Bank of
America and FleetBoston shall use their reasonable best efforts to have the Form
S-4 declared effective under the Securities Act as promptly as practicable after
such filing, and FleetBoston and Bank of America shall thereafter mail or
deliver the Joint Proxy Statement to its respective shareholders. Bank of
America shall also use its reasonable best efforts to obtain all necessary state
securities law or "Blue Sky" permits and approvals required to carry out the
transactions contemplated by this Agreement, and FleetBoston shall furnish all
information concerning FleetBoston and the holders of FleetBoston Capital Stock
as may be reasonably requested in connection with any such action.
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(b) The parties shall cooperate with each other and use their
respective reasonable best efforts to promptly prepare and file all necessary
documentation, to effect all applications, notices, petitions and filings, to
obtain as promptly as practicable all permits, consents, approvals and
authorizations of all third parties and Governmental Entities that are necessary
or advisable to consummate the transactions contemplated by this Agreement
(including the Merger), and to comply with the terms and conditions of all such
permits, consents, approvals and authorizations of all such Governmental
Entities. FleetBoston and Bank of America shall have the right to review in
advance, and, to the extent practicable, each will consult the other on, in each
case subject to applicable laws relating to the exchange of information, all the
information relating to FleetBoston or Bank of America, as the case may be, and
any of their respective Subsidiaries, which appear in any filing made with, or
written materials submitted to, any third party or any Governmental Entity in
connection with the transactions contemplated by this Agreement. In exercising
the foregoing right, each of the parties shall act reasonably and as promptly as
practicable. The parties shall consult with each other with respect to the
obtaining of all permits, consents, approvals and authorizations of all third
parties and Governmental Entities necessary or advisable to consummate the
transactions contemplated by this Agreement and each party will keep the other
apprised of the status of matters relating to completion of the transactions
contemplated by this Agreement.
(c) Each of Bank of America and FleetBoston shall, upon
request, furnish to the other all information concerning itself, its
Subsidiaries, directors, officers and shareholders and such other matters as may
be reasonably necessary or advisable in connection with the Joint Proxy
Statement, the Form S-4 or any other statement, filing, notice or application
made by or on behalf of Bank of America, FleetBoston or any of their respective
Subsidiaries to any Governmental Entity in connection with the Merger and the
other transactions contemplated by this Agreement.
(d) Each of Bank of America and FleetBoston shall promptly
advise the other upon receiving any communication from any Governmental Entity
consent or approval of which is required for consummation of the transactions
contemplated by this Agreement that causes such party to believe that there is a
reasonable likelihood that any Requisite Regulatory Approval will not be
obtained or that the receipt of any such approval may be materially delayed.
6.2 ACCESS TO INFORMATION. (a) Upon reasonable notice and
subject to applicable laws relating to the exchange of information, each of
FleetBoston and Bank of America shall, and shall cause each of its Subsidiaries
to, afford to the officers, employees, accountants, counsel and other
representatives of the other, reasonable access, during normal business hours
during the period prior to the Effective Time, to all its properties, books,
contracts, commitments and records, and, during such period, the parties shall,
and shall cause its Subsidiaries to, make available to the other party (i) a
copy of each report, schedule, registration statement and other document filed
or received by it during such period pursuant to the requirements of federal
securities laws or federal or state banking laws (other than reports or
documents that such party is not permitted to disclose under applicable law) and
(ii) all other information concerning its business, properties and personnel as
the other may reasonably request. Neither FleetBoston nor Bank of America nor
any of their Subsidiaries shall be required
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to provide access to or to disclose information where such access or disclosure
would jeopardize the attorney-client privilege of such party or its Subsidiaries
or contravene any law, rule, regulation, order, judgment, decree, fiduciary duty
or binding agreement entered into prior to the date of this Agreement. The
parties shall make appropriate substitute disclosure arrangements under
circumstances in which the restrictions of the preceding sentence apply.
(b) All information and materials provided pursuant to this
Agreement shall be subject to the provisions of the Confidentiality Agreement
entered into between the parties as of October 23, 2003 (the "Confidentiality
Agreement"). Nothing in this Agreement shall prohibit the disclosure of the tax
treatment and tax structure, as those terms are used in Treasury Regulation
Section 1.6011-4, of the transactions contemplated by this Agreement (but no
other details about the matters covered by this Agreement, including without
limitation the identities of the parties) from and after the date of the public
announcement by the parties of this Agreement and the Merger.
(c) No investigation by either of the parties or their
respective representatives shall affect the representations and warranties of
the other set forth in this Agreement.
6.3 SHAREHOLDER APPROVALS. Each of FleetBoston and Bank of
America shall call a meeting of its shareholders to be held as soon as
reasonably practicable for the purpose of obtaining the requisite shareholder
approvals required in connection with this Agreement and the Merger, and each
shall use its reasonable best efforts to cause such meetings to occur as soon as
reasonably practicable and on the same date. The Board of Directors of each of
FleetBoston and Bank of America shall use its reasonable best efforts to obtain
from its respective shareholders the shareholder vote in favor of the approval
and adoption of this Agreement required to consummate the transactions
contemplated by this Agreement.
6.4 LEGAL CONDITIONS TO MERGER. Each of Bank of America and
FleetBoston shall, and shall cause its Subsidiaries to, use their reasonable
best efforts (i) to take, or cause to be taken, all actions necessary, proper or
advisable to comply promptly with all legal requirements that may be imposed on
such party or its Subsidiaries with respect to the Merger and, subject to the
conditions set forth in Article VII, to consummate the transactions contemplated
by this Agreement, and (ii) to obtain (and to cooperate with the other party to
obtain) any material consent, authorization, order or approval of, or any
exemption by, any Governmental Entity and any other third party that is required
to be obtained by FleetBoston or Bank of America or any of their respective
Subsidiaries in connection with the Merger and the other transactions
contemplated by this Agreement.
6.5 AFFILIATES. FleetBoston shall use its reasonable best
efforts to cause each director, executive officer and other person who is an
"affiliate" (for purposes of Rule 145 under the Securities Act) of FleetBoston
to deliver to the other, as soon as practicable after the date of this
Agreement, and prior to the date of the meeting of the FleetBoston shareholders
to be held pursuant to Section 6.3, a written agreement, in the form of Exhibit
C.
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6.6 NYSE LISTING. Bank of America shall cause the shares of
Bank of America Common Stock and the Bank of America Mirror Preferred Stock to
be issued in the Merger to be approved for listing on the NYSE, subject to
official notice of issuance, prior to the Effective Time.
6.7 EMPLOYEE MATTERS. (a) From the Effective Time through
December 31, 2004 or such later date to the extent December 31, 2004 is not
practicable based on the occurrence of the Effective Time (such date being
referred to herein as the "Benefits Transition Date"), Bank of America shall
provide the employees of FleetBoston and its Subsidiaries as of the Effective
Time (the "Covered Employees") with employee benefits and compensation plans,
programs and arrangements that are substantially similar, in the aggregate, to
the employee benefits and compensation plans, programs and arrangements provided
by FleetBoston or its Subsidiaries, as the case may be, to such employees
immediately prior to the Effective Time. From and after the Benefits Transition
Date, Bank of America shall provide the Covered Employees with employee benefits
and compensation plans, programs and arrangements that are equivalent to those
provided to similarly situated employees of Bank of America and its
Subsidiaries. Notwithstanding anything contained herein to the contrary, from
and after the Effective Time, a Covered Employee who is terminated during the
period commencing at the Effective Time and ending on the second anniversary
thereof shall be entitled to receive the severance payments and benefits under
the applicable FleetBoston severance plan or policy as in effect immediately
prior to the Effective Time (without amendment during such two year period
following the Effective Time).
(b) From and after the Effective Time, Bank of America shall
(i) provide all Covered Employees with service credit for purposes of
eligibility, participation, vesting and levels of benefits (but not for benefit
accruals under any defined benefit pension plan except as otherwise provided in
this Section 6.7(b)), under any employee benefit or compensation plan, program
or arrangement adopted, maintained or contributed to by Bank of America or any
of its Subsidiaries in which Covered Employees are eligible to participate, for
all periods of employment with FleetBoston or any of its Subsidiaries (or their
predecessor entities) prior to the Effective Time, (ii) cause any pre-existing
conditions or limitations, eligibility waiting periods or required physical
examinations under any welfare benefit plans of Bank of America or any of its
Subsidiaries to be waived with respect to the Covered Employees and their
eligible dependents, to the extent waived under the corresponding plan in which
the applicable Covered Employee participated immediately prior to the Effective
Time and, with respect to life insurance coverage, up to the Covered Employee's
current level of insurability, and (iii) give the Covered Employees and their
eligible dependents credit for the plan year in which the Effective Time (or
commencement of participation in a plan of Bank of America or any of its
Subsidiaries) occurs towards applicable deductibles and annual out-of-pocket
limits for expenses incurred prior to the Effective Time (or the date of
commencement of participation in a plan of Bank of America or any of its
Subsidiaries). For purposes of any cash balance pension plan maintained or
contributed to by Bank of America or any of its Subsidiaries in which Covered
Employees become eligible to participate following the Effective Time (excluding
the cash balance pension plans maintained or sponsored by FleetBoston
immediately prior to the Effective Time), the Covered Employees' level of
benefit accruals under any such plans (for periods of service
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following the date on which the Covered Employees commence participation in such
plans) shall be determined based on the Covered Employees' credited service
prior to the Effective Time (as recognized for the same purpose by FleetBoston
for purposes of the cash balance pension plans maintained or sponsored by
FleetBoston immediately prior to the Effective Time) and with the Surviving
Corporation following the Effective Time.
(c) From and after the Effective Time, Bank of America shall
honor all accrued and vested benefit obligations to and contractual rights of
current and former employees of FleetBoston and its Subsidiaries under the
FleetBoston Benefit Plans. Bank of America agrees to take all action necessary
to effectuate and satisfy the agreements and obligations set forth in Section
6.7(c) of the FleetBoston Disclosure Schedule.
(d) Concurrently with the execution of this Agreement, Bank of
America is entering into employment agreements with each of the FleetBoston
employees whose names are set forth in Section 6.7(d) of the FleetBoston
Disclosure Schedule.
6.8 INDEMNIFICATION; DIRECTORS' AND OFFICERS' INSURANCE. (a)
In the event of any threatened or actual claim, action, suit, proceeding or
investigation, whether civil, criminal or administrative, including any such
claim, action, suit, proceeding or investigation in which any individual who is
now, or has been at any time prior to the date of this Agreement, or who becomes
prior to the Effective Time, a director, officer or employee of FleetBoston or
any of its Subsidiaries or who is or was serving at the request of FleetBoston
or any of its Subsidiaries as a director, officer, employee or agent of another
person (the "Indemnified Parties"), is, or is threatened to be, made a party
based in whole or in part on, or arising in whole or in part out of, or
pertaining to (i) the fact that he is or was a director, officer or employee of
FleetBoston or any of its Subsidiaries or (ii) this Agreement or any of the
transactions contemplated by this Agreement, whether asserted or arising before
or after the Effective Time, the parties shall cooperate and use their best
efforts to defend against and respond thereto. From and after the Effective
Time, Bank of America shall indemnify and hold harmless, as and to the fullest
extent provided by applicable law, the FleetBoston Certificate, the FleetBoston
Bylaws and any agreement set forth in Section 6.8 of the FleetBoston Disclosure
Schedule, each such Indemnified Party against any losses, claims, damages,
liabilities, costs, expenses (including reimbursement for reasonable fees and
expenses incurred in advance of the final disposition of any claim, suit,
proceeding or investigation to each Indemnified Party as provided by the
FleetBoston Certificate, the FleetBoston Bylaws and any agreement set forth in
Section 6.8 of the FleetBoston Disclosure Schedule), judgments, fines and
amounts paid in settlement in connection with any such threatened or actual
claim, action, suit, proceeding or investigation.
(b) Bank of America shall use its reasonable best efforts to
cause the individuals serving as officers and directors of FleetBoston or any of
its Subsidiaries immediately prior to the Effective Time to be covered for a
period of six years from the Effective Time by the directors' and officers'
liability insurance policy maintained by FleetBoston (provided that Bank of
America may substitute therefor policies of at least the same coverage and
amounts containing terms and conditions that are not less advantageous than such
policy)
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with respect to acts or omissions occurring prior to the Effective Time that
were committed by such officers and directors in their capacity as such.
(c) The provisions of this Section 6.8 shall survive the
Effective Time and are intended to be for the benefit of, and shall be
enforceable by, each Indemnified Party and his or her heirs and representatives.
6.9 ADDITIONAL AGREEMENTS. In case at any time after the
Effective Time any further action is necessary or desirable to carry out the
purposes of this Agreement (including any merger between a Subsidiary of Bank of
America, on the one hand, and a Subsidiary of FleetBoston, on the other) or to
vest the Surviving Corporation with full title to all properties, assets,
rights, approvals, immunities and franchises of either party to the Merger, the
proper officers and directors of each party and their respective Subsidiaries
shall take all such necessary action as may be reasonably requested by, and at
the sole expense of, Bank of America.
6.10 ADVICE OF CHANGES. Each of Bank of America and
FleetBoston shall promptly advise the other of any change or event (i) having or
reasonably likely to have a Material Adverse Effect on it or (ii) that it
believes would or would be reasonably likely to cause or constitute a material
breach of any of its representations, warranties or covenants contained in this
Agreement; provided, however, that no such notification shall affect the
representations, warranties, covenants or agreements of the parties (or remedies
with respect thereto) or the conditions to the obligations of the parties under
this Agreement; provided further that a failure to comply with this Section 6.10
shall not constitute the failure of any condition set forth in Article VII to be
satisfied unless the underlying Material Adverse Effect or material breach would
independently result in the failure of a condition set forth in Article VI to be
satisfied.
6.11 DIVIDENDS. After the date of this Agreement, each of Bank
of America and FleetBoston shall coordinate with the other the declaration of
any dividends in respect of Bank of America Common Stock and FleetBoston Common
Stock and the record dates and payment dates relating thereto, it being the
intention of the parties that holders of FleetBoston Common Stock shall not
receive two dividends, or fail to receive one dividend, for any quarter with
respect to their shares of FleetBoston Common Stock and any shares of Bank of
America Common Stock any such holder receives in exchange therefor in the
Merger.
6.12 EXEMPTION FROM LIABILITY UNDER SECTION 16(B). Bank of
America and FleetBoston agree that, in order to most effectively compensate and
retain FleetBoston Insiders (as defined below) in connection with the Merger,
both prior to and after the Effective Time, it is desirable that FleetBoston
Insiders not be subject to a risk of liability under Section 16(b) of the
Exchange Act to the fullest extent permitted by applicable law in connection
with the conversion of shares of FleetBoston Common Stock and FleetBoston Stock
Options into shares of Bank of America Common Stock in the Merger, and for that
compensatory and retentive purpose agree to the provisions of this Section 6.12.
Assuming that FleetBoston delivers to Bank of America the Section 16 Information
(as defined below) in a timely fashion, the Board of Directors of Bank of
America, or a committee of Non-Employee Directors thereof (as such term is
defined for purposes of Rule 16b-3(d) under the Exchange Act), shall adopt a
resolution providing that the
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receipt by FleetBoston Insiders of Bank of America Common Stock in exchange for
shares of FleetBoston Common Stock, and of options on Bank of America Common
Stock upon conversion of options on FleetBoston Common Stock, in each case
pursuant to the transactions contemplated by this Agreement and to the extent
such securities are listed in the Section 16 Information, are intended to be
exempt from liability pursuant to Section 16(b) under the Exchange Act. "Section
16 Information" shall mean information accurate in all material respects
regarding FleetBoston Insiders, the number of shares of FleetBoston Common Stock
held by each such FleetBoston Insider and expected to be exchanged for Bank of
America Common Stock in the Merger, and the number and description of the
options on FleetBoston Common Stock held by each such FleetBoston Insider and
expected to be converted into options on Bank of America Common Stock in
connection with the Merger; provided that the requirement for a description of
any FleetBoston Stock Options shall be deemed to be satisfied if copies of all
FleetBoston Stock Plans, and forms of agreements evidencing grants thereunder,
under which such FleetBoston Stock Options have been granted, have been made
available to Bank of America. "FleetBoston Insiders" shall mean those officers
and directors of FleetBoston who are subject to the reporting requirements of
Section 16(a) of the Exchange Act and who are listed in the Section 16
Information.
6.13 NO SOLICITATION.
(a) None of FleetBoston, its Subsidiaries or any officer,
director, employee, agent or representative (including any investment banker,
financial advisor, attorney, accountant or other retained representative) of
FleetBoston or any of its Subsidiaries shall directly or indirectly (i) solicit,
initiate or encourage or facilitate (including by way of furnishing information)
or take any other action designed to facilitate any inquiries or proposals
regarding any merger, share exchange, consolidation, sale of assets, sale of
shares of capital stock (including, without limitation, by way of a tender
offer) or similar transactions involving FleetBoston or any of its Subsidiaries
that, if consummated, would constitute an Alternative Transaction (any of the
foregoing inquiries or proposals being referred to herein as an "Acquisition
Proposal"), (ii) participate in any discussions or negotiations regarding an
Alternative Transaction or (iii) enter into any agreement regarding any
Alternative Transaction. Notwithstanding the foregoing, the Board of Directors
of FleetBoston shall be permitted, prior to the meeting of FleetBoston
shareholders to be held pursuant to Section 6.3, and subject to compliance with
the other terms of this Section 6.13 and to first entering into a
confidentiality agreement with the person proposing such Acquisition Proposal on
terms substantially similar to, and no less favorable to FleetBoston than, those
contained in the Confidentiality Agreement, to consider and participate in
discussions and negotiations with respect to a bona fide Acquisition Proposal
received by FleetBoston that the Board of Directors of FleetBoston, if and only
to the extent that the Board of Directors of FleetBoston reasonably determines
in good faith (after consultation with outside legal counsel) that failure to do
so would cause it to violate its fiduciary duties.
As used in this Agreement, "Alternative Transaction" means any
of (i) a transaction pursuant to which any person (or group of persons) other
than Bank of America or its affiliates, directly or indirectly, acquires or
would acquire more than 25 percent of the
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outstanding shares of FleetBoston Common Stock or outstanding voting power or of
any new series or new class of preferred stock that would be entitled to a class
or series vote with respect to the Merger, whether from FleetBoston or pursuant
to a tender offer or exchange offer or otherwise, (ii) a merger, share exchange,
consolidation or other business combination involving FleetBoston (other than
the Merger), (iii) any transaction pursuant to which any person (or group of
persons) other than Bank of America or its affiliates acquires or would acquire
control of assets (including for this purpose the outstanding equity securities
of subsidiaries of FleetBoston and securities of the entity surviving any merger
or business combination including any of FleetBoston's Subsidiaries) of
FleetBoston, or any of its subsidiaries representing more than 25 percent of the
fair market value of all the assets, net revenues or net income of FleetBoston
and its subsidiaries, taken as a whole, immediately prior to such transaction,
or (iv) any other consolidation, business combination, recapitalization or
similar transaction involving FleetBoston or any of its subsidiaries, other than
the transactions contemplated by this Agreement, as a result of which the
holders of shares of FleetBoston Common Stock immediately prior to such
transaction do not, in the aggregate, own at least 75 percent of each of the
outstanding shares of common stock and the outstanding voting power of the
surviving or resulting entity in such transaction immediately after the
consummation thereof in substantially the same proportion as such holders held
the shares of FleetBoston Common Stock immediately prior to the consummation
thereof.
(b) FleetBoston shall notify Bank of America promptly (but in
no event later than 24 hours) after receipt of any Acquisition Proposal, or any
material modification of or material amendment to any Acquisition Proposal, or
any request for nonpublic information relating to FleetBoston or any of its
Subsidiaries or for access to the properties, books or records of FleetBoston or
any Subsidiary by any Person or entity that informs the Board of Directors of
FleetBoston or any Subsidiary that it is considering making, or has made, an
Acquisition Proposal. Such notice to Bank of America shall be made orally and in
writing, and shall indicate the identity of the Person making the Acquisition
Proposal or intending to make or considering making an Acquisition Proposal or
requesting non-public information or access to the books and records of
FleetBoston or any Subsidiary, and the material terms of any such Acquisition
Proposal or modification or amendment to an Acquisition Proposal. FleetBoston
shall keep Bank of America fully informed, on a current basis, of any material
changes in the status and any material changes or modifications in the terms of
any such Acquisition Proposal, indication or request. FleetBoston shall also
promptly, and in any event within 24 hours, notify Bank of America, orally and
in writing, if it enters into discussions or negotiations concerning any
Acquisition Proposal in accordance with Section 6.13(a).
(c) Nothing contained in this Section 6.13 shall prohibit
FleetBoston or its Subsidiaries from taking and disclosing to its shareholders a
position required by Rule 14e-2(a) or Rule 14d-9 promulgated under the Exchange
Act.
(d) FleetBoston and its Subsidiaries shall immediately cease and
cause to be terminated any existing discussions or negotiations with any Persons
(other than Bank of America) conducted heretofore with respect to any of the
foregoing, and shall use reasonable best efforts to cause all Persons other than
Bank of America who have been furnished
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confidential information regarding FleetBoston in connection with the
solicitation of or discussions regarding an Acquisition Proposal within the 12
months prior to the date hereof promptly to return or destroy such information.
FleetBoston agrees not to, and to cause its Subsidiaries not to, release any
third party from the confidentiality and standstill provisions of any agreement
to which FleetBoston or its Subsidiaries is or may become a party, and shall
immediately take all steps necessary to terminate any approval that may have
been heretofore given under any such provisions authorizing any person to make
an Acquisition Proposal.
(e) FleetBoston shall ensure that the officers, directors and
all employees, agents and representatives (including any investment bankers,
financial advisors, attorneys, accountants or other retained representatives) of
FleetBoston or its Subsidiaries are aware of the restrictions described in this
Section 6.13 as reasonably necessary to avoid violations thereof. It is
understood that any violation of the restrictions set forth in this Section 6.13
by any officer, director, employee, agent or representative (including any
investment banker, financial advisor, attorney, accountant or other retained
representative) of FleetBoston or its Subsidiaries, at the direction or with the
consent of FleetBoston or its Subsidiaries, shall be deemed to be a breach of
this Section 6.13 by FleetBoston.
6.14 RESTRUCTURING EFFORTS. If either Bank of America or
FleetBoston shall have failed to obtain the requisite vote or votes of its
shareholders for the consummation of the transactions contemplated by this
Agreement at a duly held meeting of its shareholders or at any adjournment or
postponement thereof, each of the parties shall in good faith use its reasonable
best efforts to negotiate a restructuring of the transaction provided for herein
(it being understood that neither party shall have any obligation to alter or
change the amount or kind of the Merger Consideration in a manner adverse to
such party or its shareholders) and to resubmit the transaction to their
respective shareholders for approval.
ARTICLE VII
CONDITIONS PRECEDENT
7.1 CONDITIONS TO EACH PARTY'S OBLIGATION TO EFFECT THE
MERGER. The respective obligations of the parties to effect the Merger shall be
subject to the satisfaction at or prior to the Effective Time of the following
conditions:
(a) STOCKHOLDER APPROVAL. This Agreement shall have been
approved and adopted by the requisite affirmative vote of the holders of
FleetBoston Common Stock entitled to vote thereon and by the requisite
affirmative vote of the holders of Bank of America Common Stock entitled to vote
thereon.
(b) NYSE LISTING. The shares of Bank of America Common Stock
and Bank of America Mirror Preferred Stock to be issued to the holders of
FleetBoston Capital Stock upon consummation of the Merger shall have been
authorized for listing on the NYSE, subject to official notice of issuance.
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(c) REGULATORY APPROVALS. All regulatory approvals set forth in
Sections 3.4 and 4.4 required to consummate the transactions contemplated by
this Agreement, including the Merger, shall have been obtained and shall remain
in full force and effect and all statutory waiting periods in respect thereof
shall have expired (all such approvals and the expiration of all such waiting
periods being referred as the "Requisite Regulatory Approvals").
(d) FORM S-4. The Form S-4 shall have become effective under
the Securities Act and no stop order suspending the effectiveness of the Form
S-4 shall have been issued and no proceedings for that purpose shall have been
initiated or threatened by the SEC.
(e) NO INJUNCTIONS OR RESTRAINTS; ILLEGALITY. No order,
injunction or decree issued by any court or agency of competent jurisdiction or
other legal restraint or prohibition (an "Injunction") preventing the
consummation of the Merger or any of the other transactions contemplated by this
Agreement shall be in effect. No statute, rule, regulation, order, Injunction or
decree shall have been enacted, entered, promulgated or enforced by any
Governmental Entity that prohibits or makes illegal consummation of the Merger.
7.2 CONDITIONS TO OBLIGATIONS OF BANK OF AMERICA. The
obligation of Bank of America to effect the Merger is also subject to the
satisfaction, or waiver by Bank of America, at or prior to the Effective Time,
of the following conditions:
(a) REPRESENTATIONS AND WARRANTIES. Subject to the standard
set forth in Section 9.2, the representations and warranties of FleetBoston set
forth in this Agreement shall be true and correct as of the date of this
Agreement and as of the Effective Time as though made on and as of the Effective
Time (except that representations and warranties that by their terms speak
specifically as of the date of this Agreement or another date shall be true and
correct as of such date); and Bank of America shall have received a certificate
signed on behalf of FleetBoston by the Chief Executive Officer or the Chief
Financial Officer of FleetBoston to the foregoing effect.
(b) PERFORMANCE OF OBLIGATIONS OF FLEETBOSTON. FleetBoston
shall have performed in all material respects all obligations required to be
performed by it under this Agreement at or prior to the Closing Date; and Bank
of America shall have received a certificate signed on behalf of FleetBoston by
the Chief Executive Officer or the Chief Financial Officer of FleetBoston to
such effect.
(c) FEDERAL TAX OPINION. Bank of America shall have received
the opinion of its counsel, Cleary, Gottlieb, Xxxxx & Xxxxxxxx, in form and
substance reasonably satisfactory to Bank of America, dated the Closing Date,
substantially to the effect that, on the basis of facts, representations and
assumptions set forth in such opinion that are consistent with the state of
facts existing at the Effective Time, the Merger will be treated as a
reorganization within the meaning of Section 368(a) of the Code. In rendering
such opinion, counsel may require and rely upon representations contained in
certificates of officers of FleetBoston and Bank of America, reasonably
satisfactory in form and substance to it.
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7.3 CONDITIONS TO OBLIGATIONS OF FLEETBOSTON. The obligation of
FleetBoston to effect the Merger is also subject to the satisfaction or waiver
by FleetBoston at or prior to the Effective Time of the following conditions:
(a) REPRESENTATIONS AND WARRANTIES. Subject to the standard set
forth in Section 9.2, the representations and warranties of Bank of America set
forth in this Agreement shall be true and correct as of the date of this
Agreement and as of the Effective Time as though made on and as of the Effective
Time (except that representations and warranties that by their terms speak
specifically as of the date of this Agreement or another date shall be true and
correct as of such date); and FleetBoston shall have received a certificate
signed on behalf of Bank of America by the Chief Executive Officer or the Chief
Financial Officer of Bank of America to the foregoing effect.
(b) PERFORMANCE OF OBLIGATIONS OF BANK OF AMERICA. Bank of
America shall have performed in all material respects all obligations required
to be performed by it under this Agreement at or prior to the Closing Date, and
FleetBoston shall have received a certificate signed on behalf of Bank of
America by the Chief Executive Officer or the Chief Financial Officer of Bank of
America to such effect.
(c) FEDERAL TAX OPINION. FleetBoston shall have received the
opinion of its counsel, Wachtell, Lipton, Xxxxx & Xxxx, in form and substance
reasonably satisfactory to FleetBoston, dated the Closing Date, substantially to
the effect that, on the basis of facts, representations and assumptions set
forth in such opinion that are consistent with the state of facts existing at
the Effective Time, the Merger will be treated as a reorganization within the
meaning of Section 368(a) of the Code. In rendering such opinion, counsel may
require and rely upon representations contained in certificates of officers of
FleetBoston and Bank of America, reasonably satisfactory in form and substance
to it.
ARTICLE VIII
TERMINATION AND AMENDMENT
8.1 TERMINATION. This Agreement may be terminated at any time
prior to the Effective Time, whether before or after approval of the matters
presented in connection with the Merger by the shareholders of FleetBoston or
Bank of America:
(a) by mutual consent of FleetBoston and Bank of America in a
written instrument, if the Board of Directors of each so determines by a vote of
a majority of the members of its respective entire Board of Directors;
(b) by either the Board of Directors of FleetBoston or the
Board of Directors of Bank of America if any Governmental Entity that must grant
a Requisite Regulatory Approval has denied approval of the Merger and such
denial has become final and nonappealable or any Governmental Entity of
competent jurisdiction shall have issued a final and nonappealable order
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permanently enjoining or otherwise prohibiting the consummation of the
transactions contemplated by this Agreement;
(c) by either the Board of Directors of FleetBoston or the
Board of Directors of Bank of America if the Merger shall not have been
consummated on or before the first anniversary of the date of this Agreement
unless the failure of the Closing to occur by such date shall be due to the
failure of the party seeking to terminate this Agreement to perform or observe
the covenants and agreements of such party set forth in this Agreement;
(d) by either the Board of Directors of Bank of America or the
Board of Directors of FleetBoston if there shall have been a breach of any of
the covenants or agreements or any of the representations or warranties set
forth in this Agreement on the part of FleetBoston, in the case of a termination
by Bank of America, or Bank of America, in the case of a termination by
FleetBoston, which breach, either individually or in the aggregate, would result
in, if occurring or continuing on the Closing Date, the failure of the
conditions set forth in Section 7.2 or 7.3, as the case may be, and which is not
cured within 45 days following written notice to the party committing such
breach or by its nature or timing cannot be cured within such time period; or
(e) by either Bank of America or FleetBoston, if its Board of
Directors determines in good faith by a majority vote that the other party has
substantially engaged in bad faith in breach of its obligations under Section
6.14 of this Agreement.
8.2 EFFECT OF TERMINATION. In the event of termination of this
Agreement by either FleetBoston or Bank of America as provided in Section 8.1,
this Agreement shall forthwith become void and have no effect, and none of
FleetBoston, Bank of America, any of their respective Subsidiaries or any of the
officers or directors of any of them shall have any liability of any nature
whatsoever under this Agreement, or in connection with the transactions
contemplated by this Agreement, except that (i) Sections 6.2(b), 8.2, 9.3, 9.4,
9.9 and 9.10 shall survive any termination of this Agreement, and (ii)
notwithstanding anything to the contrary contained in this Agreement, neither
FleetBoston nor Bank of America shall be relieved or released from any
liabilities or damages arising out of its willful breach of any provision of
this Agreement. Notwithstanding the foregoing, in the event of any termination
of this Agreement, the Stock Option Agreements shall remain in full force and
effect in accordance with their respective terms.
8.3 AMENDMENT. Subject to compliance with applicable law and
Section 1.1(b), this Agreement may be amended by the parties, by action taken or
authorized by their respective Boards of Directors, at any time before or after
approval of the matters presented in connection with Merger by the shareholders
of FleetBoston or Bank of America; provided, however, that after any approval of
the transactions contemplated by this Agreement by the shareholders of
FleetBoston and Bank of America, there may not be, without further approval of
such shareholders, any amendment of this Agreement that changes the amount or
the form of the consideration to be delivered under this Agreement to the
holders of FleetBoston Common
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Stock, other than as contemplated by this Agreement. This Agreement may not be
amended except by an instrument in writing signed on behalf of each of the
parties.
8.4 EXTENSION; WAIVER. At any time prior to the Effective Time,
the parties, by action taken or authorized by their respective Board of
Directors, may, to the extent legally allowed, (a) extend the time for the
performance of any of the obligations or other acts of the other party, (b)
waive any inaccuracies in the representations and warranties contained in this
Agreement and (c) waive compliance with any of the agreements or conditions
contained in this Agreement; provided, however, that after any approval of the
transactions contemplated by this Agreement by the shareholders of FleetBoston
and Bank of America, there may not be, without further approval of such
shareholders, any extension or waiverof this Agreement or any portion hereof
that reduces the amount or changes the form of the consideration to be delivered
to the holders of FleetBoston Common Stock under this Agreement, other than as
contemplated by this Agreement. Any agreement on the part of a party to any such
extension or waiver shall be valid only if set forth in a written instrument
signed on behalf of such party, but such extension or waiver or failure to
insist on strict compliance with an obligation, covenant, agreement or condition
shall not operate as a waiver of, or estoppel with respect to, any subsequent or
other failure.
ARTICLE IX
GENERAL PROVISIONS
9.1 CLOSING. On the terms and subject to conditions set forth
in this Agreement, the closing of the Merger (the "Closing") shall take place at
10:00 a.m. on a date and at a place to be specified by the parties, which date
shall be no later than five business days after the satisfaction or waiver
(subject to applicable law) of the latest to occur of the conditions set forth
in Article VII (other than those conditions that by their nature are to be
satisfied or waived at the Closing), unless extended by mutual agreement of the
parties (the "Closing Date").
9.2 STANDARD. No representation or warranty of FleetBoston
contained in Article III or of Bank of America contained in Article IV shall be
deemed untrue or incorrect for any purpose under this Agreement, and no party
hereto shall be deemed to have breached a representation or warranty for any
purpose under this Agreement, in any case as a consequence of the existence or
absence of any fact, circumstance or event unless such fact, circumstance or
event, individually or when taken together with all other facts, circumstances
or events inconsistent with any representations or warranties contained in
Article III, in the case of FleetBoston, or Article IV, in the case of Bank of
America, has had or would be reasonably likely to have a Material Adverse Effect
with respect to FleetBoston or Bank of America, respectively (disregarding for
purposes of this Section 9.2 any materiality or Material Adverse Effect
qualification contained in any representations or warranties). Notwithstanding
the immediately preceding sentence, the representations and warranties contained
in Section 3.2(a), in the case of FleetBoston, and Section 4.2(a), in the case
of Bank of America, shall be deemed untrue and incorrect if not true and correct
in all material respects.
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9.3 NONSURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
None of the representations, warranties, covenants and agreements set forth in
this Agreement or in any instrument delivered pursuant to this Agreement shall
survive the Effective Time, except for Section 6.8 and for those other covenants
and agreements contained in this Agreement that by their terms apply or are to
be performed in whole or in part after the Effective Time. After the Effective
Time, the provisions of Section 1.11(a) may be amended by a vote of 75% of the
Board of Directors of the Surviving Corporation. The provisions of Section
1.11(b) shall be subject to the continuing interpretation of the Board of
Directors of the Surviving Corporation, which shall have the sole authority for
interpreting such provisions consistent with the purposes reflected therein.
9.4 EXPENSES. All costs and expenses incurred in connection
with this Agreement and the transactions contemplated by this Agreement shall be
paid by the party incurring such expense; provided, however, that the costs and
expenses of printing and mailing the Joint Proxy Statement, and all filing and
other fees paid to the SEC in connection with the Merger, shall be borne equally
by FleetBoston and Bank of America.
9.5 NOTICES. All notices and other communications in connection
with this Agreement shall be in writing and shall be deemed given if delivered
personally, sent via facsimile (with confirmation), mailed by registered or
certified mail (return receipt requested) or delivered by an express courier
(with confirmation) to the parties at the following addresses (or at such other
address for a party as shall be specified by like notice):
(a) if to FleetBoston, to:
FleetBoston Financial Corporation
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
XX XX 00000X
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: General Counsel
Facsimile: (000) 000-0000
with a copy to:
Wachtell, Lipton, Xxxxx & Xxxx
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxx, Esq.
Facsimile: (000) 000-0000
and
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(b) if to Bank of America, to:
Bank of America Corporation
000 Xxxxx Xxxxx Xxxxxx
XX0-000-00-00
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: General Counsel
Facsimile: (000) 000-0000
with a copy to:
Cleary, Gottlieb, Xxxxx & Xxxxxxxx
0000 Xxxxxxxxxxxx Xxxxxx, XX
Xxxxxxxxxx, X.X. 00000-0000
Attention: Xxxx X. Xxxxxx, Xx., Esq.
Facsimile: (000) 000-0000
9.6 INTERPRETATION. When a reference is made in this Agreement
to Articles, Sections, Exhibits or Schedules, such reference shall be to a
Article or Section of or Exhibit or Schedule to this Agreement unless otherwise
indicated. The table of contents and headings contained in this Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. Whenever the words "include," "includes" or
"including" are used in this Agreement, they shall be deemed to be followed by
the words "without limitation." The FleetBoston Disclosure Schedule and the Bank
of America Disclosure Schedule, as well as all other schedules and all exhibits
hereto, shall be deemed part of this Agreement and included in any reference to
this Agreement. This Agreement shall not be interpreted or construed to require
any person to take any action, or fail to take any action, if to do so would
violate any applicable law.
9.7 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective when counterparts have been signed by each of the parties
and delivered to the other party, it being understood that each party need not
sign the same counterpart.
9.8 ENTIRE AGREEMENT. This Agreement (including the documents
and the instruments referred to in this Agreement), together with the
Confidentiality Agreement and the Stock Option Agreements, constitutes the
entire agreement and supersedes all prior agreements and understandings, both
written and oral, between the parties with respect to the subject matter of this
Agreement, other than the Confidentiality Agreement and the Stock Option
Agreements.
9.9 GOVERNING LAW. This Agreement shall be governed and
construed in accordance with the internal laws of the State of New York
applicable to contracts made and wholly-performed within such state, without
regard to any applicable conflicts of law principles.
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9.10 PUBLICITY. Neither FleetBoston nor Bank of America shall,
and neither FleetBoston nor Bank of America shall permit any of its Subsidiaries
to, issue or cause the publication of any press release or other public
announcement with respect to, or otherwise make any public statement concerning,
the transactions contemplated by this Agreement without the prior consent (which
consent shall not be unreasonably withheld) of Bank of America, in the case of a
proposed announcement or statement by FleetBoston, or FleetBoston, in the case
of a proposed announcement or statement by Bank of America; provided, however,
that either party may, without the prior consent of the other party (but after
prior consultation with the other party to the extent practicable under the
circumstances) issue or cause the publication of any press release or other
public announcement to the extent required by law or by the rules and
regulations of the NYSE.
9.11 ASSIGNMENT; Third Party Beneficiaries. Neither this
Agreement nor any of the rights, interests or obligations under this Agreement
shall be assigned by either of the parties (whether by operation of law or
otherwise) without the prior written consent of the other party. Subject to the
preceding sentence, this Agreement shall be binding upon, inure to the benefit
of and be enforceable by each of the parties and their respective successors and
assigns. Except as otherwise specifically provided in Section 6.8, this
Agreement (including the documents and instruments referred to in this
Agreement) is not intended to and does not confer upon any person other than the
parties hereto any rights or remedies under this Agreement.
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
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IN WITNESS WHEREOF, FleetBoston and Bank of America have
caused this Agreement to be executed by their respective officers thereunto duly
authorized as of the date first above written.
FLEETBOSTON FINANCIAL CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxx
--------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Chairman and Chief Executive Officer
BANK OF AMERICA CORPORATION
By: /s/ Xxxxxxx X. Xxxxx
----------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Chairman and Chief Executive Officer
SIGNATURE PAGE TO AGREEMENT AND PLAN OF MERGER
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Form of Affiliate Letter
Bank of America Corporation
---------------------------
---------------------------
Ladies and Gentlemen:
I have been advised that as of the date hereof I may be deemed
to be an "affiliate" of FleetBoston Financial Corporation, a Rhode Island
corporation ("FleetBoston"), as the term "affiliate" is defined for purposes of
paragraphs (c) and (d) of Rule 145 of the Rules and Regulations (the "Rules and
Regulations") of the Securities and Exchange Commission (the "Commission") under
the Securities Act of 1933, as amended (the "Act"). I have been further advised
that pursuant to the terms of the Agreement and Plan of Merger dated as of
October 27, 2003 (the "Merger Agreement"), by and between Bank of America
Corporation, a Delaware corporation ("Bank of America"), and FleetBoston,
FleetBoston shall be merged with and into Bank of America (the "Merger") and
each share of the common stock, par value $0.01 per share, of FleetBoston
("FleetBoston Common Stock") shall be converted into the right to receive 0.5553
of a share of common stock, par value $0.01 per share, of Bank of America ("Bank
of America Common Stock"). All terms used in this letter but not defined herein
shall have the meanings ascribed thereto in the Merger Agreement.
I represent, warrant and covenant to Bank of America that in
the event I receive any Bank of America Common Stock as a result of the Merger:
(a) I shall not make any sale, transfer or other disposition of
Bank of America Common Stock in violation of the Act or the Rules and
Regulations.
(b) I have carefully read this letter and the Merger Agreement
and discussed its requirements and other applicable limitations upon my ability
to sell, transfer or otherwise dispose of Bank of America Common Stock to the
extent I believed necessary with my counsel or counsel for FleetBoston.
(c) I have been advised that the issuance of Bank of America
Common Stock to me pursuant to the Merger will be registered with the Commission
under the Act on a Registration Statement on Form S-4. However, I have also been
advised that, since at the time the Merger will be submitted for a vote of the
stockholders of FleetBoston I may be deemed to have been an affiliate of
FleetBoston and the distribution by me of Bank of America Common Stock has not
been registered under the Act, I may not sell, transfer or otherwise dispose of
Bank of America Common Stock issued to me in the Merger unless (i) such sale,
transfer or other disposition has been registered under the Act, (ii) such sale,
transfer or other disposition is made in conformity with the volume and other
limitations of Rule 145 promulgated by the Commission under the Act, or (iii) in
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the opinion of counsel reasonably acceptable to Bank of America, such sale,
transfer or other disposition is otherwise exempt from registration under the
Act.
(d) I understand that Bank of America is under no obligation to
register the sale, transfer or other disposition of Bank of America Common Stock
by me or on my behalf under the Act or to take any other action necessary in
order to make compliance with an exemption from such registration available.
(e) I also understand that stop transfer instructions will be
given to Bank of America's transfer agents with respect to Bank of America
Common Stock and that there will be placed on the certificates for Bank of
America Common Stock issued to me, or any substitutions therefor, a legend
stating in substance:
"The securities represented by this certificate have been
issued in a transaction to which Rule 145 promulgated under
the Securities Act of 1933 applies and may only be sold or
otherwise transferred in compliance with the requirements of
Rule 145 or pursuant to a registration statement under said
act or an exemption from such registration."
(f) I also understand that unless the transfer by me of my Bank
of America Common Stock has been registered under the Act or is a sale made in
conformity with the provisions of Rule 145, Bank of America reserves the right
to put the following legend on the certificates issued to my transferee:
"The shares represented by this certificate have not been
registered under the Securities Act of 1933 and were acquired
from a person who received such shares in a transaction to
which Rule 145 promulgated under the Securities Act of 1933
applies. The shares have been acquired by the holder not with
a view to, or for resale in connection with, any distribution
thereof within the meaning of the Securities Act of 1933 and
may not be sold, pledged or otherwise transferred except in
accordance with an exemption from the registration
requirements of the Securities Act of 1933."
It is understood and agreed that the legends set forth above
shall be removed by delivery of substitute certificates without such legend,
and/or the issuance of a letter to Bank of America's transfer agent removing
such stop transfer instructions, and the above restrictions on sale will cease
to apply, if (A) one year (or such other period as may be required by Rule
145(d)(2) under the Securities Act or any successor thereto) shall have elapsed
from the Closing Date and the provisions of such Rule are then available to me;
or (B) if two years (or such other period as may be required by Rule 145(d)(3)
under the Securities Act or any successor thereto) shall have elapsed from the
Effective Date and the provisions of such Rule are then available to me; or (C)
I shall have delivered to Bank of America (i) a copy of a letter from the staff
of the
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Commission, or an opinion of counsel in form and substance reasonably
satisfactory to Bank of America, or other evidence reasonably satisfactory to
Bank of America, to the effect that such legend and/or stop transfer
instructions are not required for purposes of the Securities Act or (ii)
reasonably satisfactory evidence or representations that the securities
represented by such certificates are being or have been transferred in a
transaction made in conformity with the provisions of Rule 145 under the
Securities Act or pursuant to an effective registration under the Securities
Act.
I recognize and agree that the foregoing provisions also apply
to (i) my spouse, (ii) any relative of mine or my spouse occupying my home,
(iii) any trust or estate in which I, my spouse or any such relative owns at
least 10% beneficial interest or of which any of us serves as trustee, executor
or in any similar capacity and (iv) any corporate or other organization in which
I, my spouse or any such relative owns at least 10% of any class of equity
securities or of the equity interest.
It is understood and agreed that this Letter Agreement shall
terminate and be of no further force and effect if the Merger Agreement is
terminated in accordance with its terms.
Execution of this letter should not be construed as an
admission on my part that I am an "affiliate" of FleetBoston as described in the
first paragraph of this letter or as a waiver of any rights I may have to object
to any claim that I am such an affiliate on or after the date of this letter.
Very truly yours,
By:
--------------------------
Name:
Accepted this [___] day of
[__________], 2003
Bank of America Corporation
By: ________________________
Name:
Title:
