Exhibit 2.1
AMENDED AND RESTATED
AGREEMENT AND PLAN OF REORGANIZATION
by and among
STAR BANC CORPORATION,
FIRSTAR CORPORATION,
FIRSTAR (WI) CORPORATION and
FIRSTAR MERGER CORPORATION
Dated as of June 30, 1998, as amended and restated on September 17, 1998
TABLE OF CONTENTS
Page
ARTICLE I
THE FIRST STEP MERGER
1.1. The First Step Merger...........................................2.
1.2 First Effective Time........................................... 3.
1.3 Effects of the First Step Merger................................4.
1.4 Conversion of Securities....................................... 5.
1.5 Firstar(WI)Common Stock.........................................6.
1.6 Options.........................................................7.
1.7 Articles of Incorporation.......................................8.
1.8 By-Laws.........................................................4.
ARTICLE II
THE SECOND STEP MERGER
2.1. The Second Step Merger.........................................4
2.2. Effective Time.................................................4
2.3. Effects of the Second Step Merger..............................4
2.4. Conversion of Star Common Stock................................4
2.5. Dissenting Shares..............................................5
2.6. Options........................................................6
2.7. Firstar (WI) Common Stock......................................6
2.8. Articles of Incorporation......................................6
2.9. By-Laws........................................................6
2.10. Management.....................................................6
2.11. Board of Directors.............................................6
2.12. Headquarters of Firstar(WI)....................................7
2.13. Tax and Accounting Consequences................................7
ARTICLE III
EXCHANGE OF SHARES
3.1. Exchange Procedures............................................7
3.2. No Fractional Shares...........................................9
3.3. Anti-Dilution Adjustments......................................9
ARTICLE IV
REPRESENTATIONS, WARRANTIES AND COVENANTS
4.1. Disclosure Schedules..........................................10
4.2. Standard......................................................10
4.3. Representations and Warranties................................10
ARTICLE V
CONDUCT OF BUSINESSES PRIOR TO THE EFFECTIVE TIME
5.1. Conduct of Businesses Prior to the Effective Time..............21
5.2. Fobearances...................................................21
ARTICLE VI
ADDITIONAL AGREEMENTS
6.1. Access and Information.........................................23
6.2. Registration Statement; Regulatory Matters.....................24
6.3. Stockholder Approval...........................................25
6.4. Current Information............................................25
6.5. Agreements of Affiliates.......................................25
6.6. Expenses.......................................................26
6.7. Securities Act and Exchange Act Filings.......... .............26
6.8. Miscellaneous Agreements and Consents..........................26
6.9. Employee Benefit Plans.........................................27
6.10. D&O Indemnification............................................28
6.11. Press Releases.................................................29
6.12. Pooling of Interests...........................................29
6.13. Insurance......................................................30
6.14. Conforming Entries.............................................30
6.15. Additional Actions.............................................30
6.16. Dividends......................................................30
6.17. Issuance of Shares.............................................31
6.18. Changes in Structure...........................................31
6.19. Amending Governance Documents..................................31
6.20. Board of Directors; Management.................................31
ARTICLE VII
CONDITIONS
7.1. Conditions to Each Party's Obligation to Effect the
Merger......................................................32
7.2. Conditions to Obligations of Firstar to Effect the Merger.......33
ii
7.3. Conditions to Obligations of Star To Effect the
Merger.....................................................34
ARTICLE VIII
TERMINATION, AMENDMENT AND WAIVER
8.1. Termination....................................................34
8.2. Effect of Termination..........................................35
8.3. Amendment......................................................35
8.4. Severability...................................................35
8.5. Waiver.........................................................36
ARTICLE IX
GENERAL PROVISIONS
9.1. Closing........................................................36
9.2. Non-Survival of Representations, Warranties and
Agreements..................................................36
9.3. Notices........................................................36
9.4. Interpretation.................................................37
9.5. Miscellaneous..................................................37
EXHIBITS
Exhibit A Form of Stock Option Agreement with respect to option issued
by Firstar Corporation
Exhibit B Form of Stock Option Agreement with respect to option issued
by Star Banc Corporation
Exhibit C Form of Firstar (WI) Restated Articles of Incorporation
Exhibit D Form of Firstar (WI) Restated By-laws
Exhibit E Form of Firstar Affiliate Letter
Exhibit F Form of Star Affiliate Letter
Exhibit 6.18 Form of Revised Articles I and II
iii
INDEX OF DEFINED TERMS
Affiliate.........................25 HSR Act...........................13
Agreement..........................1 Indemnified Parties...............27
Audited Financial Statements......13 Insurance Amount..................28
Banks.............................10 Lien..............................10
Benefit Plans.....................16 Material Adverse Effect...........10
Board.............................10 Meeting...........................24
Certificate of Merger..............4 Merger.............................1
Certificates.......................7 Merger Sub.........................1
Claim.............................28 Merger Sub Common Stock............2
Closing...........................35 New Benefit Plans.................26
Closing Date......................35 NYSE...............................9
Code...............................3 OGCL...............................4
Disclosure Schedule................9 Option Agreements..................1
Dissenting Shares..................5 Property..........................14
DPC Shares.........................5 Proxy Statement...................15
Equity Securities.................10 Registration Statement............15
ERISA.............................16 Regulatory Authorities............13
ERISA Affiliate...................16 Regulatory Authority..............13
Exchange Act......................13 Returns...........................16
Exchange Agent.....................7 SEC...............................13
Exchange Fund......................7 Second Merger Exchange Ratio.......5
Exchange Ratio.....................2 Second Step Merger.................1
FDIC..............................11 Star...............................1
Financial Statements..............13 Star Common Certificate............5
First Effective Time...............2 Star Common Stock..................4
First Step Merger..................1 Star Meeting......................16
Firstar............................1 Star Preferred Stock..............11
Firstar Common Certificate.........2 Star Reports......................14
Firstar Common Stock...............2 Star Rights Agreement.............11
Firstar (WI).......................1 Star Stock Option Agreement........1
Firstar (WI) Common Stock..........4 Star Stock Options................11
Firstar Meeting...................16 Star Stock Plans...................6
Firstar Preferred Stock...........11 Subsidiaries......................10
Firstar Reports...................14 Subsidiary........................10
Firstar Rights Agreement..........11 Toxic Substance...................14
Firstar Stock Option Agreement.....1 Surviving Corporation..............1
Firstar Stock Options.............11 Trust Account Shares...............5
Firstar Stock Plans................3 Unaudited Financial Statements....13
GAAP...............................7 WBCL...............................2
Holding Company Act...............10
iv
AMENDED AND RESTATED
AGREEMENT AND PLAN OF REORGANIZATION
This AMENDED AND RESTATED AGREEMENT AND PLAN OF REORGANIZATION,
constituting a plan of merger for purposes of the Wisconsin Business
Corporation Law, is made and entered into on June 30, 1998, as amended and
restated on September 17, 1998 (this "Agreement"), by and among Star Banc
Corporation, an Ohio corporation ("Star"), Firstar Corporation, a Wisconsin
corporation ("Firstar"), Firstar (WI) Corporation ("Firstar (WI)"), a
Wisconsin corporation and a wholly-owned subsidiary of Firstar, and Firstar
Merger Corporation, a Wisconsin corporation and a wholly-owned subsidiary of
Firstar (WI) ("Merger Sub").
W I T N E S S E T H:
WHEREAS, the Boards of Directors of Star, Firstar, Firstar (WI) and
Merger Sub have determined that it is in the best interests of their
respective companies and their stockholders to consummate the business
combination transaction provided for herein in which (a) Merger Sub will,
subject to the terms and conditions set forth herein, merge with and into
Firstar (the "First Step Merger") so that (i) Firstar is the surviving
corporation in the First Step Merger and (ii) Firstar (WI) becomes the
ultimate parent holding company for Firstar after the First Step Merger, and
(b) immediately thereafter Star will, subject to the terms and conditions set
forth herein, merge with and into Firstar (the "Second Step Merger" and,
together with the First Step Merger, the "Merger"), so that (i) Firstar is
the surviving corporation (hereinafter sometimes referred to in such capacity
as the "Surviving Corporation") in the Second Step Merger and (ii) Firstar
(WI) continues to be the ultimate parent holding company for Firstar after
the Second Step Merger; and
WHEREAS, it is the intent of the respective Boards of Directors of
Star and Firstar that the Merger be structured as a "merger of equals" of
Star and Firstar in accordance with the terms and conditions of this
Agreement; and
WHEREAS, as a condition to, and simultaneously with the execution
of, this Agreement, Star and Firstar will enter into a Firstar stock option
agreement (the "Firstar Stock Option Agreement") in the form attached hereto
as Exhibit A; and
WHEREAS, as a condition to, and simultaneously with the execution
of, this Agreement, Star and Firstar will enter into a Star stock option
agreement (the "Star Stock Option Agreement" and, together with the Firstar
Stock Option Agreement, the "Option Agreements") in the form attached hereto
as Exhibit B; and
WHEREAS, the parties desire to provide for certain conditions,
representations, warranties and covenants in connection with the transactions
contemplated by this Agreement.
NOW THEREFORE, in consideration of the mutual covenants,
representations, warranties and agreements herein contained, and intending to
be legally bound thereby, the parties agree as follows:
ARTICLE I
THE FIRST STEP MERGER
Section 1.1. THE FIRST STEP MERGER. Subject to the terms and
conditions of this Agreement, Merger Sub shall be merged with and into
Firstar in accordance with the Wisconsin Business Corporation Law (the
"WBCL") and the separate corporate existence of Merger Sub shall cease.
Firstar shall be the surviving corporation of the First Step Merger and shall
continue its corporate existence under the name "Firstar Holdings
Corporation." Firstar (WI) shall become the ultimate parent holding company
for Firstar after the First Step Merger and shall continue to be governed by
the laws of the State of Wisconsin.
Section 1.2. FIRST EFFECTIVE TIME. The First Step Merger shall
become effective on the date and at the time (the "First Effective Time")
specified in the appropriate documents in respect of the First Step Merger
which are filed with the Department of Financial Institutions of the State of
Wisconsin in such form as required by, and in accordance with, the relevant
provisions of the WBCL. The First Effective Time shall occur on the same date
and immediately prior to the Effective Time as specified in Section 2.2.
Section 1.3. EFFECTS OF THE FIRST STEP MERGER. At and after the
First Effective Time, the First Step Merger shall have the effects set forth
in Section 180.1106 of the WBCL.
Section 1.4. CONVERSION OF SECURITIES. (a) At the First Effective
Time, by virtue of the First Step Merger and without any action on the part
of Star, Firstar, Firstar (WI), Merger Sub or the holders of any capital
stock of Firstar, Star, Firstar (WI) or Merger Sub, (i) each share of the
common stock, par value $1.25, of Firstar ("Firstar Common Stock") issued and
outstanding immediately prior to the First Effective Time shall cease to be
outstanding and (other than any shares of Firstar Common Stock held by
Firstar or any of its wholly owned Subsidiaries (as defined herein), except
for Trust Account Shares (as defined herein) and DPC Shares (as defined
herein)), shall be converted into the right to receive 0.76 (the "Exchange
Ratio") shares of Firstar (WI) Common Stock (as defined herein) and (ii) each
share of the common stock, par value $0.01, of Merger Sub ("Merger Sub Common
Stock") issued and outstanding immediately prior to the First Effective Time
shall cease to be outstanding and shall be converted into the right to
receive one share of Firstar Common Stock.
(b) All of the shares of Firstar Common Stock converted into the
right to receive Firstar (WI) Common Stock pursuant to this Article I shall
no longer be outstanding and shall automatically be cancelled and shall cease
to exist as of the First Effective Time, and each certificate (each a
"Firstar Common Certificate") previously representing any such shares of
Firstar Common Stock shall thereafter represent only the right to receive (i)
a certificate representing the number of whole shares of Firstar (WI) Common
Stock and (ii) cash in lieu of any frac-
tional shares otherwise issuable pursuant to Section 1.4(a), in accordance
with Section 3.2. Firstar Common Certificates previously representing shares
of Firstar Common Stock shall be exchanged for certificates representing
whole shares of Firstar (WI) Common Stock and cash in lieu of fractional
shares issued in consideration therefor upon the surrender of such Firstar
Common Certificates in accordance with Section 3.1 without any interest
thereon.
(c) All of the shares of Merger Sub Common Stock converted into the
right to receive Firstar Common Stock pursuant to this Article I shall no
longer be outstanding and shall automatically be cancelled and shall cease to
exist as of the First Effective Time, and each certificate previously
representing any such shares of Merger Sub Common Stock shall thereafter
represent only the right to receive a certificate representing the number of
whole shares of Firstar Common Stock.
(d) At the First Effective Time, all shares of Firstar Common Stock
that are owned by Firstar as treasury stock and all shares of Firstar Common
Stock that are owned, directly or indirectly, by Firstar or any of its wholly
owned Subsidiaries (other than Trust Account Shares and DPC Shares) shall be
cancelled and shall cease to exist and no stock of Firstar (WI) or other
consideration shall be delivered in exchange therefor.
Section 1.5. FIRSTAR (WI) COMMON STOCK. At and after the First
Effective Time, each share of Firstar (WI) Common Stock issued and
outstanding immediately prior to the First Effective Time shall be cancelled
and retired and shall resume the status of authorized and unissued shares of
Firstar (WI) Common Stock, and no shares of Firstar (WI) Common Stock or
other securities of Firstar (WI) shall be issued in respect thereof.
Section 1.6. OPTIONS. Firstar shall take action to amend the
Firstar Stock Plans (as defined herein) so that, at the Effective Time, each
option granted by Firstar to purchase shares of Firstar Common Stock which is
outstanding and unexercised immediately prior thereto shall cease to
represent a right to acquire shares of Firstar Common Stock and shall be
converted automatically into an option to purchase shares of Firstar (WI)
Common Stock in an amount and at an exercise price determined as follows (and
otherwise subject to the terms of the appropriate Firstar Benefit Plan (as
defined herein) pursuant to which such options have been granted (such plans
collectively the "Firstar Stock Plans") and the agreements evidencing grants
thereunder): (i) the number of shares of Firstar (WI) Common Stock to be
subject to the new option shall be equal to the product of the number of
shares of Firstar Common Stock subject to the original option and the
Exchange Ratio, provided that any fractional shares of Firstar (WI) Common
Stock resulting from such multiplication shall be rounded down to the nearest
whole share and (ii) the exercise price per share of Firstar (WI) Common
Stock under the new option shall be equal to the exercise price per share of
Firstar Common Stock under the original option divided by the Exchange Ratio,
provided that such exercise price shall be rounded down to the nearest whole
cent. The adjustment provided herein with respect to any options which are
"incentive stock options" (as defined in Section 422 of the Internal Revenue
Code of 1986, as amended (the "Code")) shall be and is intended to be
effected in a manner which is consistent with Section 424(a) of the Code. The
duration and other terms of the new option shall be the same as the original
option except that all references to Firstar shall be deemed to be references
to Firstar (WI).
Section 1.7. ARTICLES OF INCORPORATION. At the First Effective
Time, the Articles of Incorporation of Firstar as in effect immediately prior
to the First Effective Time shall continue to be the Articles of
Incorporation of Firstar except that the name of the corporation shall be
changed to "Firstar Holdings Corporation," until thereafter amended in
accordance with applicable law.
Section 1.8. BY-LAWS. At the First Effective Time, the By-Laws of
Firstar as in effect immediately prior to the First Effective Time shall
continue to be the By-Laws of Firstar, until thereafter amended in accordance
with applicable law.
ARTICLE II
THE SECOND STEP MERGER
Section 2.1. THE SECOND STEP MERGER. Subject to the terms and
conditions of this Agreement, in accordance with the Ohio General Corporation
Law (the "OGCL") and the WBCL, at the Effective Time Star shall merge with
and into Firstar. Firstar shall be the surviving corporation in the Second
Step Merger and shall continue its corporate existence under the name
"Firstar Holdings Corporation." Firstar (WI) shall continue to be the
ultimate parent holding company for Firstar after the Second Step Merger and
shall continue to be governed by the laws of the State of Wisconsin. Upon
consummation of the Second Step Merger, the separate corporate existence of
Star shall terminate. The parties shall take all necessary action such that,
upon consummation of the Second Step Merger, Firstar (WI) shall continue its
corporate existence under the name "Firstar Corporation."
Section 2.2. EFFECTIVE TIME. The Second Step Merger shall become
effective as set forth in the appropriate documents (the "Certificate of
Merger") which shall be filed with the Department of Financial Institutions
of the State of Wisconsin and the Secretary of State of the State of Ohio on
the Closing Date (as defined herein). The term "Effective Time" shall be the
date and time when the Second Step Merger becomes effective, as set forth in
the Certificate of Merger. Subject to the terms and conditions of this
Agreement, the Effective Time shall occur on a date to be specified by the
parties, which shall be the first day which is (i) the last business day of a
month and (ii) at least two business days after satisfaction or waiver
(subject to applicable law) of the conditions (excluding conditions that, by
their terms, cannot be satisfied until the Closing Date) set forth in Article
VII, unless another time or date is agreed to in writing by the parties
hereto.
Section 2.3. EFFECTS OF THE SECOND STEP MERGER. At and after the
Effective Time, the Second Step Merger shall have the effects set forth in
Sections 180.1106 and 180.1107 of the WBCL and Section 1701.82 of the OGCL.
Section 2.4. CONVERSION OF STAR COMMON STOCK. (a) At the Effective
Time, by virtue of the Second Step Merger and without any action on the part
of Star, Firstar or Firstar (WI) or the holders of capital stock of Star,
Firstar or Firstar (WI), each share of the common stock, par value $5.00 per
share, of Star (the "Star Common Stock") issued and outstanding im-
mediately prior to the Effective Time (other than Dissenting Shares (as
defined herein) and shares of Star Common Stock held in Star's treasury or
directly or indirectly by Star or any of its wholly owned Subsidiaries or
Firstar (WI) (except for Trust Account Shares and DPC Shares)) shall be
converted into the right to receive one share (the "Second Merger Exchange
Ratio") of the common stock, par value $0.01, of Firstar (WI) (the "Firstar
(WI) Common Stock").
(b) All of the shares of Star Common Stock converted into the right
to receive Firstar (WI) Common Stock pursuant to this Article II shall no
longer be outstanding and shall automatically be cancelled and shall cease to
exist as of the Effective Time, and each certificate (each a "Star Common
Certificate") previously representing any such shares of Star Common Stock
shall thereafter represent only the right to receive (i) a certificate
representing the number of whole shares of Firstar (WI) Common Stock and (ii)
cash in lieu of any fractional shares otherwise issuable pursuant to Section
2.4(a), in accordance with Section 3.2. Star Common Certificates previously
representing shares of Star Common Stock shall be exchanged for certificates
representing whole shares of Firstar (WI) Common Stock and cash in lieu of
fractional shares issued in consideration therefor upon the surrender of such
Star Common Certificates in accordance with Section 3.1 without any interest
thereon.
(c) At the Effective Time, all shares of Star Common Stock that
are owned by Star as treasury stock and all shares of Star Common Stock that
are owned, directly or indirectly, by Star or any of its wholly owned
Subsidiaries or Firstar (WI) (other than shares of Star Common Stock held,
directly or indirectly, in trust accounts, managed accounts and the like or
otherwise held in a fiduciary capacity that are beneficially owned by third
parties (any such shares, and shares of Firstar Common Stock which are
similarly held, whether held directly or indirectly by Star, Firstar (WI) or
Firstar, as the case may be, or any of their respective Subsidiaries being
referred to herein as "Trust Account Shares") and other than any shares of
Star Common Stock held by Star or Firstar or any of their respective
Subsidiaries or Firstar (WI) in respect of a debt previously contracted (any
such shares of Star Common Stock and shares of Firstar Common Stock which are
similarly held, whether held directly or indirectly by Star, Firstar (WI) or
Firstar, as the case may be, or any of their respective Subsidiaries, being
referred to herein as "DPC Shares")) shall be cancelled and shall cease to
exist and no stock of Firstar (WI) or other consideration shall be delivered
in exchange therefor.
Section 2.5. DISSENTING SHARES. Notwithstanding anything in this
Agreement to the contrary, shares of Star Common Stock which are outstanding
immediately prior to the Effective Time and with respect to which dissenters'
rights shall have been properly demanded in accordance with Section 1701.85
of the OGCL ("Dissenting Shares") shall not be converted into the right to
receive Firstar (WI) Common Stock; instead, the holders thereof shall be
entitled to payment of the appraised value of such Dissenting Shares in
accordance with the provisions of Section 1701.85 of the OGCL; provided,
however, that (i) if any holder of Dissenting Shares shall subsequently
deliver a written withdrawal of his demand for appraisal of such shares, or
(ii) if any holder fails to establish his entitlement to dissenters' rights
as provided in Section 1701.85 of the OGCL, such holder or holders (as the
case may be) shall forfeit the right to appraisal of such shares of Star
Common Stock and each of such shares shall thereupon be deemed to have
been converted into the right to receive, and to have become exchangeable
for, as of the Effective Time, Firstar (WI) Common Stock, as provided in
Section 2.4(a) hereof.
Section 2.6. OPTIONS. Star shall take action to amend the Star
Stock Plans (as defined herein) so that, at the First Effective Time, each
option granted by Star to purchase shares of Star Common Stock which is
outstanding and unexercised immediately prior thereto shall cease to
represent a right to acquire shares of Star Common Stock and shall be
converted automatically into an option to purchase a number of shares of
Firstar (WI) Common Stock equal to the number of shares of Star Common Stock
subject to such option immediately prior to the First Effective Time at an
exercise price per share of Firstar (WI) Common Stock equal to the exercise
price per share of Star Common Stock in effect immediately prior to the
Effective Time and otherwise subject to the terms of the appropriate Star
Benefit Plans pursuant to which such options have been granted (such plans
collectively the "Star Stock Plans") and the agreements evidencing grants
thereunder. The adjustment provided herein with respect to any options which
are "incentive stock options" (as defined in Section 422 of the Code) shall
be and is intended to be effected in a manner which is consistent with
Section 424(a) of the Code. The duration and other terms of the new option
shall be the same as the original option except that all references to Star
shall be deemed to be references to Firstar (WI).
Section 2.7. FIRSTAR (WI) COMMON STOCK. At and after the Effective
Time, each share of Firstar (WI) Common Stock issued and outstanding
immediately prior to the Effective Time shall remain an issued and
outstanding share of common stock of Firstar (WI) and shall not be affected
by the Second Step Merger.
Section 2.8. ARTICLES OF INCORPORATION. At the Effective Time, the
Articles of Incorporation of Firstar as in effect immediately prior to the
Effective Time shall continue to be the Articles of Incorporation of the
Surviving Corporation, until thereafter amended in accordance with applicable
law.
Section 2.9. BY-LAWS. At the Effective Time, the By-Laws of Firstar
as in effect immediately prior to the Effective Time shall continue to be the
By-Laws of the Surviving Corporation, until thereafter amended in accordance
with applicable law.
Section 2.10. MANAGEMENT. (a) From and after the Effective Time,
Xxxxx X. Xxxxxxxxxxx shall be Chairman of the Board of Firstar (WI) (and
shall continue in such position until he becomes 62 years old) and Xxxxx X.
Xxxxxxxxxx shall be the President and Chief Executive Officer of Firstar
(WI), and Xx. Xxxxxxxxxx shall be designated to succeed Xx. Xxxxxxxxxxx as
Chairman.
Section 2.11. BOARD OF DIRECTORS. From and after the Effective
Time, until duly changed in compliance with applicable law and the Articles
of Incorporation and By-Laws of Firstar (WI), the Board of Directors of
Firstar (WI) shall be as specified in Section 6.20(a). From and after the
Effective Time, until duly changed in compliance with applicable law and the
Articles of Incorporation and By-Laws of the Surviving Corporation, the Board
of Directors of the Surviving Corporation shall be the Board of Dirctors of
Firstar. The majority of the meetings of
the Board of Directors of Firstar (WI) and the Surviving Corporation in any
calendar year shall be held in Milwaukee, Wisconsin.
Section 2.12. HEADQUARTERS OF FIRSTAR (WI). After the Effective
Time, the location of the headquarters and principal executive offices of
Firstar (WI) and the Surviving Corporation shall be that of the headquarters
and principal executive offices of Firstar as of the date of this Agreement
located in Milwaukee, Wisconsin. After the Effective Time, the banking
Subsidiaries of Firstar (WI) shall be merged into a single bank, the name of
which shall be Firstar and the headquarters of which shall be in Milwaukee,
Wisconsin.
Section 2.13. TAX AND ACCOUNTING CONSEQUENCES. It is intended that
the First Step Merger and the Second Step Merger shall each constitute a
reorganization within the meaning of Section 368(a) of the Code, that this
Agreement shall constitute a "plan of reorganization" for the purposes of
Sections 354 and 361 of the Code and that the Merger be accounted for as a
"pooling of interests" under generally accepted accounting principles
("GAAP").
ARTICLE III
EXCHANGE OF SHARES
Section 3.1. EXCHANGE PROCEDURES. (a) At or prior to the First
Effective Time, the parties shall deposit, or shall cause to be deposited,
with a bank or trust company agreed to by each of Star and Firstar (the
"Exchange Agent"), for the benefit of the holders of Certificates (as defined
herein), for exchange in accordance with this Article III, certificates
representing the shares of Firstar (WI) Common Stock, and cash in lieu of any
fractional shares (such cash and certificates for shares of Firstar (WI)
Common Stock, together with any dividends or distributions with respect
thereto, being hereinafter referred to as the "Exchange Fund"), to be issued
pursuant to Sections 1.4 and 2.4 and paid pursuant to Section 3.2 in exchange
for outstanding shares of Firstar Common Stock and Star Common Stock. Firstar
and Star shall deliver to Firstar (WI) a complete list of their respective
shareholders (including their respective names, addresses and TINs to the
extent reflected in the records maintained by such party or its transfer
agent) as of the record date for the shareholder meetings to be called by the
parties as provided for herein and as of the First Effective Time for Firstar
and the Effective Time for Star, in each case which delivery shall be made as
soon as practicable after the respective date.
(b) As soon as practicable after the Effective Time, the Exchange
Agent shall mail to each holder of record immediately prior to the First
Effective Time or the Effective Time, as applicable, of one or more Firstar
Common Certificates or Star Common Certificates (collectively, the
"Certificates") a letter of transmittal (which shall specify 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 Firstar (WI) Common
Stock issuable and any cash in lieu of fractional shares payable pursuant to
this Agreement. Upon proper surrender of a Certificate for exchange and
cancellation to the Exchange Agent, together with such properly completed
letter of transmittal, duly executed, the holder of such Certificate shall be
entitled to receive in exchange therefor, as applicable, (i) a certificate
representing that number of whole
shares of Firstar (WI) Common Stock to which such holder of Star Common Stock
or Firstar Common Stock shall have become entitled pursuant to the provisions
of Articles I and II, as applicable, and (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 surrendered pursuant to the provisions
of this Article III and any dividend or distribution theretofore declared and
not yet paid on such shares of Firstar (WI) Common Stock, and the Certificate
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.
(c) If any certificate representing shares of Firstar (WI) Common
Stock is to be issued in a name other than that in which the Certificate
surrendered in exchange therefor is registered, it shall be a condition of
the issuance thereof that the Certificate 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 Firstar (WI) Common Stock in any name other than that of the registered
holder of the Certificate 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. The Surviving Corporation or the Exchange Agent
shall accept Certificates upon compliance with such other reasonable terms
and conditions as the Surviving Corporation or the Exchange Agent may impose
to effect an orderly exchange thereof in accordance with customary exchange
practices. Certificates shall be appropriately endorsed or accompanied by
such instruments of transfer as the Surviving Corporation or the Exchange
Agent may require.
(d) Any portion of the Exchange Fund, including any earnings
thereon, which remains undistributed to the holders of Certificates for six
months after the Effective Time shall be delivered to the Surviving
Corporation, upon demand, and any holders of Certificates who have not
theretofore complied with this Section 3.1 shall thereafter look only to the
Surviving Corporation for payment of their claim for the consideration
provided for herein and any unpaid dividends and distributions on the Firstar
(WI) Common Stock deliverable in respect of such Certificates.
(e) After the Effective Time, holders of Certificates shall cease
to have any rights with respect to the stock previously represented by such
Certificates, and their sole rights shall be to exchange such Certificates
for the consideration provided for in this Agreement. After the Effective
Time, there shall be no further transfers on the records of Firstar of
Firstar Common Certificates and no further transfers on the records of Star
of Star Common Certificates, and if such Certificates are presented to
Firstar or Star, as applicable, for transfer, they shall be cancelled against
delivery of the consideration provided therefor in this Agreement. Firstar
(WI) shall not be obligated to deliver the consideration to which any former
holder of securities is entitled as a result of the Merger until such holder
surrenders the Certificates as provided herein. No dividends declared on
Firstar (WI) Common Stock will be remitted to any holder of Firstar Common
Stock or the Star Common Stock entitled to receive Firstar (WI) Common Stock
under this Agreement until such person surrenders the Certificate
representing the right to receive such Firstar (WI) Common Stock, at which
time such dividends shall be remitted to such person,
without interest and less any taxes that may have been imposed thereon.
Neither the Exchange Agent nor any party to this Agreement nor any affiliate
thereof shall be liable to any holder of stock represented by any Certificate
for any consideration paid to a public official pursuant to applicable
abandoned property, escheat or similar laws. The Surviving Corporation and
the Exchange Agent shall be entitled to rely upon the stock transfer books of
Firstar and Star to establish the identity of those persons entitled to
receive consideration specified in this Agreement, which books shall be
conclusive with respect thereto. In the event of a dispute with respect to
ownership of stock represented by any Certificate, the Surviving Corporation
and the Exchange Agent shall be entitled to deposit any consideration
represented thereby in escrow with an independent third party and thereafter
be relieved with respect to any claims thereto.
(f) 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 Firstar (WI), the posting by such person of a bond in such amount
as Firstar (WI) 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 Firstar (WI) Common Stock and any cash in lieu of
fractional shares deliverable in respect thereof pursuant to this Agreement.
(g) Former holders of record as of the First Effective Time of
shares of Firstar Common Stock and as of the Effective Time of Star Common
Stock shall not be entitled, at and after the First Effective Time and the
Effective Time, respectively, to vote any shares of the Firstar (WI) Common
Stock until their Certificates shall have been surrendered in accordance with
this Article III and certificates evidencing such Firstar (WI) Common Stock
shall have been issued in exchange therefor.
Section 3.2. NO FRACTIONAL SHARES. Notwithstanding any other
provision of this Agreement, neither certificates nor scrip for fractional
shares of Firstar (WI) Common Stock shall be issued in the Merger. Each
holder who otherwise would have been entitled to a fraction of a share of
Firstar (WI) Common Stock shall receive in lieu thereof cash (without
interest) in an amount determined by multiplying the fractional share
interest to which such holder would otherwise be entitled by the closing sale
price of a share of Star Common Stock on the New York Stock Exchange, Inc.
("NYSE") composite tape on the last full trading day prior to the Effective
Time. No such holder shall be entitled to dividends, voting rights or any
other rights in respect of any fractional share.
Section 3.3. ANTI-DILUTION ADJUSTMENTS. If, prior to the Effective
Time, the outstanding shares of Star Common Stock or Firstar 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 (other
than solely as a result of the First Step Merger), appropriate adjustment or
adjustments will be made to the Exchange Ratio or the Second Merger Exchange
Ratio, as applicable.
ARTICLE IV
REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 4.1. DISCLOSURE SCHEDULES. On or prior to the date hereof,
each of Star and Firstar has delivered to the other a schedule (respectively,
its "Disclosure Schedule") setting forth, among other things, items the
disclosure of which is necessary or appropriate in relation to any or all of
its representations and warranties set forth in this Agreement; PROVIDED,
that (i) no such item is required to be set forth in a Disclosure Schedule as
an exception to a representation or warranty if its absence is not reasonably
likely to result in the related representation or warranty being deemed
untrue or incorrect under the standard established by Section 4.2, and (ii)
the mere inclusion of an item in a Disclosure Schedule shall not be deemed an
admission by a party that such item represents a material exception or fact,
event or circumstance or that such item would reasonably be expected to
result in a material adverse effect on the financial condition, results of
operations or business of such party and its Subsidiaries taken as a whole,
except as may have resulted or may result from changes to laws and
regulations or changes in economic conditions applicable to banking
institutions generally or in general levels of interest rates affecting
banking institutions generally (a "Material Adverse Effect").
Section 4.2. STANDARD. No representation or warranty of Star or
Firstar contained in Section 4.3 shall be deemed untrue or incorrect, and no
party hereto shall be deemed to have breached any such representation or
warranty, as a consequence of the existence of any fact, circumstance or
event unless such fact, circumstance or event which constitutes a breach of
any such representation or warranty after giving effect to any materiality
standards contained in any representation or warranty, individually or taken
together with all other facts, circumstances or events constituting such
breaches, has had or would reasonably be expected to have a Material Adverse
Effect on such party.
Section 4.3. REPRESENTATIONS AND WARRANTIES. Subject to Sections
4.1 and 4.2 and except as previously disclosed in its Disclosure Schedule,
Firstar hereby represents and warrants to Star, and Star hereby represents
and warrants to Firstar, to the extent applicable, in each case with respect
to itself and its Subsidiaries, as follows:
(a) ORGANIZATION AND AUTHORITY. Such party and each of its
respective Subsidiaries is a corporation, bank, trust company or other entity
duly organized, validly existing and in good standing under the laws of the
jurisdiction of organization, is duly qualified to do business and is in good
standing in all jurisdictions where its ownership or leasing of property or
the conduct of its business requires it to be so qualified and has corporate
power and authority to own its properties and assets and to carry on its
business as it is now being conducted except, in each case, where the failure
to do so would not either individually or in the aggregate reasonably be
expected to have a Material Adverse Effect on such party. Such party is duly
registered as a bank holding company with the Board of Governors of the
Federal Reserve System (the "Board") under the Bank Holding Company Act of
1956, as amended (the "Holding Company Act"). True and complete copies of the
Articles of Incorporation and By-laws or Code of Regu-
lation as applicable, of such party, each in effect on the date of this
Agreement, have been provided to the other party.
(b) SUBSIDIARIES. Such party's Disclosure Schedule sets forth,
among other things, a complete and correct list of all of such party's direct
or indirect subsidiaries (each a "Subsidiary" and collectively the
"Subsidiaries") including such party's banks (the "Banks"), all outstanding
Equity Securities of each of which are owned directly or indirectly by such
party. "Equity Securities" of an issuer means capital stock or other equity
securities of such issuer, options, warrants, scrip, rights to subscribe to,
calls or commitments of any character whatsoever relating to, or securities
or rights convertible into, shares of any capital stock or other Equity
Securities of such issuer, or contracts, commitments, understandings or
arrangements by which such issuer is or may become bound to issue additional
shares of its capital stock or other Equity Securities. All of the
outstanding shares of capital stock of the Subsidiaries of such party are
validly issued, fully paid and nonassessable (subject to Section
180.0622(2)(6) of the WBCL), and those shares owned by such party are owned
free and clear of any lien, claim, charge, option, encumbrance, agreement,
mortgage, pledge, security interest or restriction (a "Lien") with respect
thereto. Except for the Equity Securities of such party's Subsidiaries and
except for Equity Interests held in a fiduciary capacity, such party does not
own beneficially, directly or indirectly, more than 5% of any class of Equity
Securities or similar interests of any corporation, bank, business trust,
association or similar organization. The Banks of such party are chartered by
the Office of the Comptroller of the Currency. The deposits of the Banks of
such party are insured by the Federal Deposit Insurance Corporation ("FDIC").
Neither such party nor any Subsidiary thereof holds any interest in a
partnership or joint venture of any kind.
(c) CAPITALIZATION. (i) The authorized capital stock of Star
consists of (A) 400,000,000 shares of Star Common Stock, of which, as of June
29, 1998, 95,778,921 shares were issued and outstanding and (B) 1,000,000
shares of preferred stock, no par value ("Star Preferred Stock"), issuable in
series, none of which, as of June 29, 1998, is issued or outstanding. Star
has designated (Y) 500,000 shares of Star Preferred Stock as "Series A
Preferred Stock" and has reserved such shares for issuance upon exercise of
Preferred Stock Purchase Rights under a Rights Agreement dated October 27,
1989 (the "Star Rights Agreement"), between Star and Star Bank, N.A., as
Rights Agent and (Z) 218,000 shares of Star Preferred Stock as "Series B
Cumulative Preferred Stock." Pursuant to the Star Rights Agreement, each
certificate representing one share of Star Common Stock also represents one
Right (as defined in the Star Rights Agreement). As of June 29, 1998 Star had
options outstanding for 7,020,988 shares of Star Common Stock for issuance
under various employee stock option and incentive plans ("Star Stock
Options"). From June 29, 1998 through the date of this Agreement, no shares
of Star Common Stock have been issued excluding not more than 500 shares
which may have been issued pursuant to stock-based, director or employee
benefit or incentive plans and programs. Except as set forth above and except
pursuant to the Star Rights Agreement, there are no other Equity Securities
of Star outstanding. All of the issued and outstanding shares of Star Common
Stock are validly issued, fully paid, and nonassessable, and have not been
issued in violation of any preemptive right of any stockholder of Star.
(ii) The authorized capital stock of Firstar consists of (A)
240,000,000 shares of Firstar Common Stock, of which, as of June 29, 1998,
145,546,889 shares were issued and outstanding and (B) 2,500,000 shares of
preferred stock ("Firstar Preferred Stock"), issuable in series. Firstar has
designated (Y) 600,000 shares of Firstar Preferred Stock as "Series C
Preferred Stock" and has reserved such shares for issuance upon exercise of
Preferred Stock Purchase Rights under a Rights Agreement dated January 19,
1989 (the "Firstar Rights Agreement"), between Firstar and Firstar Trust
Company (formerly known as First Wisconsin Trust Company), as Rights Agent
and (Z) certain shares of Firstar Preferred Stock as "Series A Preferred
Stock," "Series B Preferred Stock" and "Series D Preferred Stock" all of
which have been redeemed. Pursuant to the Firstar Rights Agreement, each
certificate representing one share of Firstar Common Stock also represents
one-quarter Right (as defined in the Firstar Rights Agreement). As of June
29, 1998 Firstar had options outstanding for 6,037,093 shares of Firstar
Common Stock for issuance under various employee stock option and incentive
plans ("Firstar Stock Options"). From June 29, 1998 through the date of this
Agreement, no shares of Firstar Common Stock have been issued excluding not
more than 500 shares which may have been issued pursuant to stock-based,
director or employee benefit or incentive plans and programs. Except as set
forth above and except pursuant to the Firstar Rights Agreement, there are no
other Equity Securities of Firstar outstanding. All of the issued and
outstanding shares of Firstar Common Stock are validly issued, fully paid,
and nonassessable (subject to Section 180.0622(2)(b) of the WBCL), and have
not been issued in violation of any preemptive right of any stockholder of
Firstar.
(d) AUTHORIZATION. (i) Such party has the corporate power and
authority to execute and deliver this Agreement and to carry out its
obligations hereunder. The execution, delivery and performance of this
Agreement by such party and the consummation by such party of the
transactions contemplated hereby have been duly authorized by all requisite
corporate action of the Board of Directors of such party. The Board of
Directors of such party has directed that this Agreement and the transactions
contemplated hereby be submitted to its stockholders for approval at a
meeting of such stockholders and, except for the adoption of this Agreement
by the affirmative vote of holders of a majority of its outstanding shares,
no other corporate proceedings on the part of such party are necessary to
approve this Agreement and to consummate the transactions contemplated
hereby. This Agreement has been duly and validly executed and delivered by
such party and (assuming due authorization, execution and delivery by the
other party) constitutes a valid and binding obligation of such party,
enforceable against such party in accordance with its 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). Firstar represents and warrants that each of Firstar, as the sole
stockholder of Firstar (WI), and Firstar (WI), as the sole stockholder of
Merger Sub, and the respective Board of Directors of Merger Sub and Firstar
(WI), has approved this Agreement and the transactions contemplated hereby by
written consent and no other corporate proceedings on the part of Merger Sub
or Firstar (WI) are necessary to approve this Agreement and to consummate the
transactions contemplated hereby.
(ii) Neither the execution, delivery and performance by such party
of this Agreement, nor the consummation by such party of the transactions
contemplated hereby, nor
compliance by such party with any of the provisions hereof, will (A) violate,
conflict with or result in a breach of any provisions of, or constitute a
default (or an event which, with notice or lapse of time or both, would
constitute a default) or result in the termination of, or accelerate the
performance required by, or result in a right of termination or acceleration
of, or result in the creation of, any Lien upon any of the properties or
assets of such party or any Subsidiary of such party under any of the terms,
conditions or provisions of (I) its articles or certificate of incorporation
or bylaws or code of regulations, or (II) any note, bond, mortgage,
indenture, deed of trust, license, lease, agreement or other instrument or
obligation to which such party or any of the properties or assets of such
party is a party or by which it may be bound, or to which such party may be
subject (assuming no default thereunder at the time of the Merger), except
(in the case of this clause (II)) for such violations, conflicts, breaches or
defaults which, either individually or in the aggregate, will not have a
Material Adverse Effect on such party or (B) subject to compliance with the
statutes and regulations referred to in paragraph (iii) of this Section
4.3(d), to the best knowledge of such party, violate any judgment, ruling,
order, writ, injunction, decree, statute, rule or regulation applicable to
such party or any of its Subsidiaries or any of their respective properties
or assets except for such violations which, either individually or in the
aggregate will not have a Material Adverse Effect on such party.
(iii) Other than in connection with or in compliance with the
provisions of the WBCL, the Securities Act, the Exchange Act of 1934, as
amended, and the rules and regulations thereunder (the "Exchange Act"), the
securities or blue sky laws of the various states or filings, consents,
reviews, authorizations, approvals or exemptions required under the Holding
Company Act, and the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 0000
(xxx "XXX Xxx"), or any required approvals of the Office of the Controller of
Currency, the Small Business Administration or any state or foreign
Regulatory Authority (as defined herein), no notice to, filing with,
exemption or review by, or authorization, consent or approval of, any public
body or authority is necessary in connection with the execution and delivery
by such party of this Agreement or the consummation by such party of the
transactions contemplated by this Agreement.
(e) FINANCIAL STATEMENTS. The consolidated balance sheets of such
party and its Subsidiaries as of December 31, 1997, 1996 and 1995 and related
consolidated statements of income, cash flows and changes in stockholders'
equity for each of the three years in the three-year period ended December
31, 1997, together with the notes thereto, audited by such party's
independent auditors and included in an annual report on Form 10-K as filed
with the Securities and Exchange Commission (the "SEC") (collectively, the
"Audited Financial Statements"), and the consolidated balance sheet of such
party and its Subsidiaries as of March 31, 1998 and related consolidated
statements of income, cash flows and changes in stockholders' equity for the
three-month period ended March 31, 1998 included in a quarterly report on
Form 10-Q as filed with the SEC (collectively, the "Unaudited Financial
Statements", and together with the Audited Financial Statements, the
"Financial Statements") have been prepared in accordance with GAAP, present
fairly the consolidated financial position of such party and its Subsidiaries
at the dates and the consolidated results of operations, changes in
stockholders' equity and cash flows of such party and its Subsidiaries for
the periods stated therein, subject, in the case of the Unaudited Financial
Statements, to normal year-end audit adjustments, and are derived from the
books and records of such party and its Subsidiaries, which are complete and
accurate in all material re-
spects and have been maintained in all material respects in accordance with
applicable laws and regulations. Neither such party nor any of its
Subsidiaries has any material contingent liabilities that are not described
in the financial statements described above other than liabilities incurred
in the ordinary course of such party's business consistent with past
practice, or in connection with this Agreement and the transactions
contemplated hereby.
(f) REPORTS. Since January 1, 1995, such party and its Subsidiaries
have timely filed all material reports, registrations and statements,
together with any required material amendments thereto, that it was required
to file with (i) the SEC, including, but not limited to, Forms 10-K, Forms
10-Q, Forms 8-K and proxy statements, (ii) the Board, (iii) the FDIC, (iv)
the Office of the Controller of the Currency, (v) the Small Business
Administration and (vi) any other federal, state, municipal, local or foreign
government, securities, banking, savings and loan, insurance and other
governmental or regulatory authority and the agencies and staffs thereof (the
entities in the foregoing clauses (i) through (vi) being referred to herein
collectively as the "Regulatory Authorities" and individually as a
"Regulatory Authority") and all other reports and statements required to be
filed by such party, including, without limitation, any report or statement
required to be filed pursuant to laws, rules or regulations of the United
States, any state, or any Regulatory Authority, 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, either individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect on such party. All such reports
and statements filed with any such Regulatory Authority are collectively
referred to herein as the "Star Reports" and the "Firstar Reports," as
applicable. As of its respective date, each of the Star Reports and the
Firstar Reports, as applicable, of such party complied in all material
respects with all the rules and regulations promulgated by the applicable
Regulatory Authority and did not contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(g) MATERIAL ADVERSE CHANGE. Since December 31, 1997, no event has
occurred or circumstances arisen that, individually or taken together with
all other events and circumstances, has had or is reasonably expected to have
a Material Adverse Effect on such party.
(h) COMPLIANCE WITH LAWS. Such party and its Subsidiaries have
complied with all laws, regulations, and orders (including without limitation
zoning ordinances, building codes, ERISA (as defined herein), and securities,
tax, environmental, civil rights, and occupational health and safety laws and
regulations and including without limitation in the case of any Subsidiary of
such party that is a bank, banking organization, banking corporation or trust
company, all statutes, rules and regulations pertaining to the conduct of a
banking, deposit-taking or lending or related business or to the exercise of
trust powers) and governing instruments applicable to them and to the conduct
of their business, and to the knowledge of such party all applicable listing
requirements and policies of the NYSE, except where such failure to comply
would not have a Material Adverse Effect on such party, and neither such
party nor any Subsidiary of such party is in default under, and no event has
occurred which, with the lapse of time or notice or both, could result in the
default under, the terms of any judgment, order, writ, decree, permit, or
license
of any Regulatory Authority or court, whether federal, state, municipal, or
local and whether at law or in equity, except where such default would not
reasonably be expected to have a Material Adverse Effect on such party.
Neither such party nor any Subsidiary of such party is subject to or
reasonably likely to incur a liability as a result of its ownership,
operation, or use of any Property (as defined herein) of such party (whether
directly or, to the best knowledge of such party, as a consequence of such
Property being part of the investment portfolio of such party or any
Subsidiary of such party) (i) that is contaminated by or contains any Toxic
Substance (as defined herein) or (ii) on which any Toxic Substance has been
stored, disposed of, placed, or used in the construction thereof; and which,
in each case, reasonably could be expected to have a Material Adverse Effect
on such party. "Property" of a person shall include all property (real or
personal, tangible or intangible) owned or controlled by such person,
including, without limitation, property under foreclosure, property held by
such person or any subsidiary of such person in its capacity as a trustee and
property in which any venture capital or similar unit of such person or any
subsidiary of such person has an interest. A "Toxic Substance" is anything
that is contaminated by or contains any hazardous waste, toxic substance, or
related materials, including, without limitation, asbestos, PCBs, pesticides,
herbicides and any other substance or waste that is hazardous to human health
or the environment. Except for statutory or regulatory restrictions of
general application, no Regulatory Authority has placed any restriction on
the business of such party or any Subsidiary of such party which reasonably
could be expected to have a Material Adverse Effect on such party.
(i) REGISTRATION STATEMENT, ETC. None of the information regarding
such party or any of its Subsidiaries supplied or to be supplied by such
party for inclusion or included in (i) the registration statement on Form S-4
to be filed with the SEC for the purposes of registering the shares of
Firstar (WI) Common Stock to be issued pursuant to this Agreement (the
"Registration Statement"), (ii) the proxy or information statement to be
mailed to Star's stockholders and Firstar's stockholders in connection with
the transactions contemplated by this Agreement (the "Proxy Statement"), or
(iii) any other documents to be filed with any Regulatory Authority in
connection with the transactions contemplated hereby will, at the respective
times such documents are filed with any Regulatory Authority and, in the case
of the Registration Statement, when it becomes effective and, with respect to
the Proxy Statement, when mailed, be false or misleading with respect to any
material fact, or omit to state any material fact necessary in order to make
the statements therein not misleading or, in the case of the Proxy Statement
or any amendment thereof or supplement thereto, at the time of the meeting of
Star's stockholders (the "Star Meeting") and the meeting of Firstar's
stockholders (the "Firstar Meeting") referred to in Section 6.3, be false or
misleading with respect to any material fact, or omit to state any material
fact necessary to correct any statement in any earlier communication with
respect to the solicitation of any proxy for the Meeting. All documents which
such party or any of its Subsidiaries are responsible for filing with any
Regulatory Authority in connection with the Merger will comply as to form in
all material respects with the provisions of applicable law.
(j) BROKERS AND FINDERS. Except as set forth in the engagement
letter agreement between Firstar and Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated, a true and complete copy of which has been provided to Star
prior to the date hereof, and the engagement letter agreement between Star
and CS First Boston, a true and complete copy of which has been pro-
vided to Firstar prior to the date hereof, neither such party nor any of its
Subsidiaries nor any of their respective officers, directors or employees has
employed any broker or finder or incurred any liability for any financial
advisory fees, brokerage fees, commissions or finder's fees, and no broker or
finder has acted directly or indirectly for such party or any of its
Subsidiaries in connection with this Agreement or the transactions
contemplated hereby.
(k) LITIGATION AND OTHER PROCEEDINGS. (i) Neither such party nor
any of its Subsidiaries is a party to any, and there are no pending or, to
the knowledge of such party, threatened, legal, administrative, arbitral or
other proceedings, claims, actions or governmental or regulatory
investigations of any nature against such party or any of its Subsidiaries or
challenging the validity or propriety of the transactions contemplated by
this Agreement as to which, in any such case, there is a reasonable
probability of an adverse determination and which, if adversely determined
either individually or in the aggregate, would reasonably be expected to have
a Material Adverse Effect on such party.
(ii) There is no injunction, order, judgment, decree or regulatory
restriction (other than those that apply to similarly situated bank holding
companies or banks) imposed upon such party, any of its Subsidiaries or the
assets of such party or any of its Subsidiaries that has had or would
reasonably be expected to have a Material Adverse Effect on such party or the
Surviving Corporation.
(l) TAXES. Such party and each Subsidiary have timely filed or will
timely file (including extensions) all material tax returns required to be
filed at or prior to the Closing Date ("Returns"). Each of such party and its
Subsidiaries has paid, or set up adequate reserves on its respective
Financial Statements for the payment of, all taxes required to be paid in
respect of the periods covered by the Financial Statements and has paid or
set up adequate reserves on the most recent financial statements such party
has filed under the Exchange Act for the payment of all taxes anticipated to
be payable in respect of the periods covered by such financial statements. No
material deficiencies for any tax, assessment or governmental charge have
been proposed, asserted or assessed in writing by any governmental or taxing
authority against such party or any Subsidiary of such party which have not
been settled or would not be covered by existing reserves. To the knowledge
of such party, neither such party nor any Subsidiary of such party is
delinquent in the payment of any material tax, assessment or governmental
charge shown to be due on any Return (taking into account extensions properly
obtained), and no waiver of the time to assess or collect any tax granted in
writing by such party or any Subsidiary of such party is pending. The federal
and state income tax returns of such party and the Subsidiaries of such party
have been audited and finally settled by the IRS or appropriate state tax
authorities or the relevant statute of limitations has expired for all
periods ended through December 31, 1991, or the period for assessment of
taxes in respect of such periods has expired.
(m) EMPLOYEE BENEFIT PLANS; ERISA. (i) Such party's Disclosure
Schedule sets forth a true and complete list of each material employee or
director benefit plan, arrangement or agreement (including, without
limitation, stock purchase, stock option, severance, employment, change in
control, fringe benefit, collective bargaining, bonus, incentive, deferred
compensation and all other employee benefit plans, agreements, programs,
policies or other arrangements,
whether or not subject to ERISA) that is maintained, or contributed to, as of
the date of this Agreement (the "Benefit Plans") by such party or any of its
Subsidiaries or by any trade or business, whether or not incorporated (an
"ERISA Affiliate"), all of which together with such party would be deemed a
"single employer" within the meaning of Section 4001 of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA").
(ii) Such party has made available to the other party true and
complete copies of each of such party's Benefit Plans and certain related
documents, including, but not limited to, (A) the actuarial report for such
party's Benefit Plans (if applicable) for each of the last two years, and (B)
the most recent determination letter from the IRS (as defined herein) (if
applicable) for such plan.
(iii) Except as would not reasonably be expected to have a Material
Adverse Effect (A) each of such party's Benefit Plans has been operated and
administered in all material respects in accordance with their terms and with
applicable laws, including, but not limited to, ERISA and the Code, (B) each
of such party's Benefit Plans intended to be "qualified" within the meaning
of Section 401(a) of the Code has received a favorable determination letter
with respect to such qualified status, or such Benefit Plans shall be
submitted for such determination in a timely fashion and there are no
existing circumstances or events that have occurred that could reasonably be
expected to adversely affect the qualified status of any such plan, (C) with
respect to each Benefit Plan of such party which is subject to Title IV of
ERISA, the present value of accrued benefits under such Plan, based upon the
actuarial assumptions used for funding purposes in the most recent actuarial
report prepared by such Plan's actuary with respect to such Plan, did not, as
of its latest valuation date, exceed the then current value of the assets of
such Plan allocable to such secured benefits, (D) no Benefit Plan of such
party provides benefits, including, without limitation, death or medical
benefits (whether or not insured), with respect to current or former
employees or directors of such party or its Subsidiaries beyond their
retirement or other termination of service, other than (1) coverage mandated
by applicable law, (2) death benefits or retirement benefits under any
"employee pension plan" (as such term is defined in Section 3(2) of ERISA),
(3) deferred compensation benefits accrued as liabilities on the books of
such party or its Subsidiaries or (4) benefits the full cost of which is
borne by the current or former employee or director (or his beneficiary), (E)
no material liability under Title IV of ERISA has been incurred by such
party, its Subsidiaries or any ERISA Affiliate that has not been satisfied in
full, and no condition exists that could reasonably be expected to present a
material risk to such party, its Subsidiaries or any ERISA Affiliate of such
party incurring a material liability thereunder (other than the payment of
premiums and funding obligations in the ordinary course of business), (F) no
Benefit Plan is a "multiemployer pension plan" (as such term is defined in
Section 3(37) of ERISA), (G) all contributions or other amounts payable by
such party or its Subsidiaries as of the Effective Time with respect to each
Benefit Plan in respect of current or prior plan years have been paid or
accrued in accordance with GAAP and Section 412 of the Code, (H) neither such
party nor its Subsidiaries has engaged in a transaction with respect to such
party's Benefit Plans in connection with which such party or its Subsidiaries
reasonably could be subject to either a material civil penalty accessed
pursuant to Section 409 or 502(i) of ERISA or a material tax imposed pursuant
to Section 4975 or 4976 of the Code, and (I) to the best knowledge of such
party,
there are no pending, threatened or anticipated claims (other than routine
claims for benefits) by, on behalf of or against any of the Benefit Plans of
such party or any trusts related thereto.
(iv) Neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby will (A) result in any
material payment (including, without limitation, severance, unemployment
compensation, "excess parachute payment" (within the meaning of Section 280G
of the Code), forgiveness of indebtedness or otherwise) becoming due to any
director or any employee of such party or any of its Subsidiaries under any
Benefit Plan of such party or otherwise, (B) materially increase any benefits
otherwise payable under any Benefit Plan of such party or (C) result in any
acceleration of the time of payment or vesting of any such benefits to any
material extent. Notwithstanding the foregoing, neither the execution of this
Agreement nor the consummation of the transactions contemplated hereby will
constitute or be deemed a "Change of Control" within the meaning of the
Firstar Supplemental Retirement Plan for Key Executives and the Firstar
Corporation Pension Plan.
(n) ACCOUNTING, TAX AND REGULATORY MATTERS. Neither such party nor
any Subsidiary of such party has taken or agreed to take any action or has
any knowledge of any fact or circumstance that would (i) prevent the First
Step Merger or the Second Step Merger from qualifying as a "reorganization"
within the meaning of Section 368(a) of the Code, (ii) prevent the
transactions contemplated hereby from qualifying as a "pooling of interests"
for accounting and financial reporting purposes or (iii) materially impede or
delay receipt of any approval referred to in Section 7.1(b) or the
consummation of the transactions contemplated by this Agreement.
(o) STATE TAKEOVER STATUTES; ARTICLES OF INCORPORATION; RIGHTS
AGREEMENT. (i) The transactions contemplated by this Agreement are not
subject to, or have been exempted from, any applicable state law which
purports to limit or restrict business combinations or the ability to acquire
or to vote shares.
(ii) The transactions contemplated by this Agreement and the
agreements contemplated hereby are not, and will not be, prohibited by, or
have been exempted from, such party's Articles of Incorporation.
(iii) Such party has taken all necessary steps (A) to render the
Star Rights Agreement or the Firstar Rights Agreement, as applicable,
inapplicable to the Merger and the transactions contemplated by this
Agreement and by the Star Stock Option Agreement and the Firstar Stock Option
Agreement, as applicable (including, such that the Rights related thereto
will not be distributed, become exercisable or be triggered in any way as a
result of the execution of this Agreement or the applicable stock option
agreement or the consummation of the transactions contemplated hereby or
thereby) and (B) to cause the Rights issued under the applicable Rights
Agreement to expire immediately prior to the First Effective Time.
(p) CONDUCT OF SUCH PARTY TO DATE. From and after January 1, 1998
through the date of this Agreement, except as would not reasonably be
expected to have a Material Adverse Effect on such party or as reflected in
such party's Financial Statements: (i) such party and its Subsidiaries have
conducted their respective businesses in the ordinary and usual course
consistent with past practices; (ii) such party has not issued, sold,
granted, conferred or awarded any of
its Equity Securities, or any corporate debt securities which would be
classified under GAAP as long-term debt on the balance sheets of such party;
(iii) such party has not effected any stock split or adjusted, combined,
reclassified or otherwise changed its capitalization (other than, with
respect to Firstar, the redemption of its Series D Preferred Stock); (iv)
such party has not declared, set aside or paid any dividend (other than its
regular quarterly or regular semi-annual common dividends or, with respect to
Firstar, regular dividends paid on its Series D Preferred Stock prior to the
redemption thereof) or other distribution in respect of its capital stock, or
purchased, redeemed, retired, repurchased, or exchanged, or otherwise
acquired or disposed of, directly or indirectly, any of its Equity
Securities, whether pursuant to the terms of such Equity Securities or
otherwise (other than, with respect to Firstar, the redemption of its Series
D Preferred Stock); (v) neither such party nor any Subsidiary has incurred
any obligation or liability (absolute or contingent), except normal trade or
business obligations or liabilities incurred in the ordinary course of
business, or subjected to Lien any of its assets or properties other than in
the ordinary course of business consistent with past practice; (vi) neither
such party nor any Subsidiary has discharged or satisfied any Lien or paid
any obligation or liability (absolute or contingent), other than in the
ordinary course of business; (vii) neither such party nor any Subsidiary has
sold, assigned, transferred, leased, exchanged, or otherwise disposed of any
of its properties or assets other than for a fair consideration in the
ordinary course of business; (viii) except as required by contract or law,
neither such party nor any Subsidiary has (A) increased the rate of
compensation of, or paid any bonus to, any of its directors, officers, or
other employees, except merit or promotion increases in accordance with
existing policy, (B) entered into any new, or amended or supplemented any
existing, employment, management, consulting, deferred compensation,
severance, or other similar contract, (C) entered into, terminated, or
substantially modified any of its Benefit Plans or (D) agreed to do any of
the foregoing; (ix) neither such party nor any Subsidiary has suffered any
damage, destruction, or loss, whether as the result of fire, explosion,
earthquake, accident, casualty, labor trouble, requisition, or taking of
property by any Regulatory Authority, flood, windstorm, embargo, riot, act of
God or the enemy, or other casualty or event, and whether or not covered by
insurance; (x) neither such party nor any Subsidiary has cancelled or
compromised any debt, except for debts charged off or compromised in
accordance with the past practice of such party and its Subsidiaries; and
(xi) neither such party nor any Subsidiary of such party has entered into any
transaction, contract or commitment outside the ordinary course of its
business.
(q) YEAR 2000 COMPLIANT. None of such party or any of its
Subsidiaries has received, or reasonably expects to receive, a "Year 2000
Deficiency Notification Letter" (as such term is employed in the Federal
Reserve's Supervision and Regulation Letter No. SR 98-3(SUP), dated March 4,
1998). Such party has disclosed to the other party a complete and accurate
copy of such party's plan for addressing the issues set forth in the
statements of the Federal Financial Institutions Examination Council, dated
May 5, 1997, entitled "Year 2000 Project Management Awareness," and December
1997, entitled "Safety and Soundness Guidelines Concerning the Year 2000
Business Risk," as such issues affect such party and its Subsidiaries.
Between the date of this Agreement and the Effective Time, such party shall
use commercially practicable efforts to implement such plan.
(r) INVESTMENT SECURITIES. Except as would not reasonably be
expected to have a Material Adverse Effect on such party, each of such party
and its Subsidiaries has good and marketable title to all securities held by
it (except securities sold under repurchase agreements or held in a fiduciary
or agency capacity), free and clear of any Lien, except to the extent such
securities are pledged in the ordinary course of business consistent with
prudent banking practices to secure obligations of such party or any of its
Subsidiaries. Such securities are valued on the books of such party in
accordance with GAAP.
(s) INTEREST RATE RISK MANAGEMENT INSTRUMENTS. Except as would not
reasonably be expected to have a Material Adverse Effect on such party, all
interest rate swaps, caps, floors and option agreements and other interest
rate risk management arrangements, whether entered into for the account of
such party or for the account of a customer of such party or one of its
Subsidiaries, were entered into in the ordinary course of business and, to
such party's knowledge, 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 such party or one of its
Subsidiaries enforceable 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. Except as would not reasonably
be expected to have a Material Adverse Effect on such party, such party and
each of its Subsidiaries have duly performed in all respects all of their
obligations thereunder to the extent that such obligations to perform have
accrued; and, to such party's knowledge, there are no breaches, violations or
defaults or allegations or assertions of such by any party thereunder.
(t) INSURANCE. Except as would not reasonably be expected to have a
Material Adverse Effect on such party, such party and its Subsidiaries have
in effect insurance coverage with reputable insurers which, in respect of
amounts, premiums, types and risks insured, constitutes reasonably adequate
coverage against all risks customarily insured against by bank holding
companies and their subsidiaries comparable in size and operations to such
party and its Subsidiaries.
(u) AGREEMENTS WITH BANK REGULATORS. Neither such party nor any of
its Subsidiaries is a party to any written agreement or memorandum of
understanding with, or a party to any commitment letter or similar
undertaking to, or is subject to any order or directive by, or is a recipient
of any extraordinary supervisory letter from, or has adopted any board
resolutions at the request of, any Regulatory Authority which restricts
materially the conduct of its business, or in any manner relates to its
capital adequacy, its credit policies or its management, nor has such party
been advised by any Regulatory Authority that is contemplating issuing or
requesting (or is considering the appropriateness of issuing or requesting)
any such order, decree, agreement, memorandum of understanding, extraordinary
supervisory letter, commitment letter or similar submission, or any such
board resolutions.
ARTICLE V
CONDUCT OF BUSINESSES PRIOR TO THE EFFECTIVE TIME
Section 5.1. CONDUCT OF BUSINESSES PRIOR TO THE EFFECTIVE TIME.
Except as provided for in Section 5.2 of this Agreement, during the period
from the date of this Agreement to the Effective Time, each of Star and
Firstar shall, and shall cause each of their respective Subsidiaries to,
conduct its business according to the ordinary and usual course consistent
with past practices and shall, and shall cause each such Subsidiary to, use
its reasonable best efforts to maintain and preserve its business
organization, employees and advantageous business relationships and retain
the services of its officers and key employees.
Section 5.2. FORBEARANCES. Except as set forth on Schedule 5.2, as
otherwise contemplated or permitted by this Agreement (including the
Disclosure Schedules) and the Option Agreements or as referred to in any Star
Reports or Firstar Reports publicly filed with the SEC prior to the date
hereof, during the period from the date of this Agreement to the Effective
Time, Firstar shall not and shall not permit its Subsidiaries to, without the
prior written consent of Star (which consent shall not be unreasonably
withheld), and Star shall not and shall not permit any of its Subsidiaries
to, without the prior written consent of Firstar (which consent shall not be
unreasonably withheld):
(a) declare, set aside or pay any dividends or other distributions,
directly or indirectly, in respect of its capital stock (other than dividends
from a wholly owned Subsidiary of such party to such party or another wholly
owned Subsidiary of such party), except that (i) Star may pay quarterly cash
dividends on Star Common Stock in an amount not to exceed the rate payable on
such Star Common Stock as of the date hereof, and (ii) Firstar may pay
quarterly cash dividends on Firstar Common Stock in an amount not to exceed
the rate payable on such Firstar Common Stock as of the date hereof (together
with any rate increase consistent with past practice); or
(b) except as disclosed on such party's Disclosure Schedule, enter
into or amend any employment, severance or similar agreement or arrangement
with any director or officer or employee or collective bargaining agreement,
or materially modify any of its Benefit Plans or grant any salary or wage
increase or materially increase any employee benefit (including incentive or
bonus payments), except normal individual increases in compensation to
employees consistent with past practice or (ii) as required by law or
contract; or
(c) authorize, recommend, propose, or announce an intention to
authorize, so recommend or propose, or enter into an agreement in principle
with respect to, any merger, consolidation or business combination, any
acquisition or disposition of a material amount of assets, including mortgage
servicing rights, loans or securities as well as any release or
relinquishment of any material contract rights (except in the usual course of
business consistent with past practices) provided, however, that the
foregoing shall not prohibit internal reorganizations or consolidations
involving existing Subsidiaries; or
(d) except for transactions in the ordinary course of business
consistent with past practice, enter into or terminate any material contract
or agreement, or make any change in any of its material leases or contracts,
other than renewals of contracts and leases without material adverse changes
of terms; or
(e) settle any material claim, action or proceeding involving money
damages, except in the ordinary course of business consistent with past
practice; or
(f) propose or adopt any amendments to its articles of
incorporation, association or other charter document or bylaws or code of
regulations; or
(g) issue, sell, grant, confer or award any of its Equity
Securities or any debt securities having the right to vote on matters on
which stockholders may vote or purchase, redeem, retire, repurchase, or
exchange, or otherwise acquire or dispose of, directly or indirectly, any of
its Equity Securities, whether pursuant to the terms of such Equity
Securities or otherwise (except for (i) shares of Firstar Common Stock or
Star Common Stock, as applicable, issued upon exercise of Firstar Stock
Options or Star Stock Options, respectively, outstanding on the date of this
Agreement or issued in accordance with this paragraph (g), (ii) pursuant to
the Option Agreements, (iii) any such transactions between a wholly-owned
Subsidiary and its parent, (iv) in accordance with the Firstar and Star Stock
Plans consistent with past practice, (v) as agent for stockholders
reinvesting dividends pursuant to a dividend reinvestment plan in accordance
with the terms thereof as in effect on the date of this Agreement, (vi) for
the acquisition of Trust Account Shares and DPC Shares, (vii) with respect to
Firstar, any repurchases of Firstar Common Stock to maintain a pool of up to
500,000 shares in the form of treasury shares for the purpose of reissuing
upon the exercise of Firstar Stock Options, or (viii) in the ordinary course
of business consistent with past practice (such party agreeing to promptly
notify the other party of any such transactions)) or effect any stock split
or adjust, combine, reclassify or otherwise change its equity capitalization
as it existed on the date of this Agreement; or
(h) solicit, encourage or authorize any individual, corporation or
other entity to solicit or encourage from any third party any inquiries or
proposals relating to the disposition of its business or assets, or the
acquisition of its voting securities, or the merger of it or any of its
Subsidiaries with any corporation or other entity other than as provided by
this Agreement (and each party shall promptly notify the other of all of the
relevant details relating to all inquiries and proposals which it may receive
relating to any of such matters); or
(i) take any action that would (i) materially adversely affect,
impede or delay the consummation of the transactions contemplated by this
Agreement and the Option Agreements or the ability of Star or Firstar to
obtain any approval of any Regulatory Authority required for the transactions
contemplated by this Agreement and the Option Agreements or to perform its
covenants and agreements under this Agreement and the Option Agreements, (ii)
prevent the First Step Merger or the Second Step Merger from qualifying as a
"reorganization" within the meaning of Section 368(a) of the Code or (iii)
prevent the transactions contemplated hereby from qualifying as a "pooling of
interests" for accounting and financial reporting purposes; or
(j) other than in the ordinary course of business consistent with
past practice and other than indebtedness of up to $800 million incurred by
Firstar and its Subsidiaries to fund Firstar's purchase from Xxxxxxx
Corporation of Cargill Leasing and to redeem Firstar's $100 million aggregate
principal amount of 7.15% Notes due September 1, 2000, and indebtedness of up
to $100 million under Firstar's bank facilities for liquidity purposes incur
any indebtedness for borrowed money (other than short-term indebtedness
incurred to refinance short-term indebtedness and indebtedness of Star or any
of its wholly-owned Subsidiaries to Star or any of its wholly-owned
Subsidiaries, on the one hand, or of Firstar or any of its wholly-owned
Subsidiaries to Firstar or any of its wholly-owned Subsidiaries, on the other
hand), assume, guarantee, endorse or otherwise as an accommodation become
responsible or liable for the obligations of any other individual,
corporation or other entity (it being understood and agreed that incurrence
of indebtedness in the ordinary course of business shall include, without
limitation, the creation of deposit liabilities, purchases of Federal funds,
sales of certificates of deposit and entering into repurchase agreements); or
(k) implement or adopt any change in its accounting principles,
practices or methods, other than as may be required by GAAP or regulatory
guidelines; or
(l) other than the sale of up to $250 million of treasury
securities by Firstar and its Subsidiaries, materially restructure or
materially change its investment securities portfolio, through purchases,
sales or otherwise, or the manner in which the portfolio is classified or
reported as of the date of the Agreement; or
(m) except as required by applicable law or regulation, (i)
implement or adopt, any material change in its interest rate and other risk
management policies, procedures or practices, (ii) fail to follow in any
material respect its existing policies or practices with respect to managing
its exposure to interest rate and other risk or (iii) fail to use
commercially reasonable means to avoid any material increase in its aggregate
exposure to interest rate risk; or
(n) take any action or make any determination the effect of which
would result in the transactions contemplated by this Agreement constituting
or being deemed to be a "Change in Control" within the meaning of the Firstar
Supplemental Retirement Plan for Key Executives and the Firstar Corporation
Pension Plan; or
(o) agree in writing or otherwise to take any of the foregoing
actions.
ARTICLE VI
ADDITIONAL AGREEMENTS
Section 6.1. ACCESS AND INFORMATION. Upon reasonable notice and
subject to applicable laws relating to the exchange of information, Star and
its Subsidiaries, on the one hand, and Firstar and its Subsidiaries, on the
other hand, shall each afford to each other, and to the other's accountants,
counsel and other representatives, access during normal business hours,
during the period prior to the Effective Time, to all their respective
employees, properties, books, contracts, commitments and records and, during
such period, each shall furnish reasonably
promptly to the other (i) a copy of each report, schedule and other document
filed or received by it during such period pursuant to the requirements of
federal and state securities and banking laws (other than any such documents
which such party is not permitted to disclose under applicable laws) and
including, but not limited to, copies of internal quarterly reserve analyses,
credit quality assessments and credit information as set forth in Schedule
6.1 (ii) all other existing or regularly produced information concerning its
business, properties and personnel, in the case of (i) and (ii) as such other
party may reasonably request. Neither Star nor Firstar nor any of their
respective Subsidiaries shall be required to provide access to or to disclose
information where such access or disclosure would violate or prejudice the
rights of Star's or Firstar's, as the case may be, customers, jeopardize the
attorney-client privilege of the institution in possession or control of such
information 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 hereto will make appropriate substitute disclosure
arrangements under circumstances in which the restrictions of the preceding
sentence apply.
Section 6.2. REGISTRATION STATEMENT; REGULATORY MATTERS. (a) The
parties shall prepare and file with the SEC as soon as is reasonably
practicable the Registration Statement (or the equivalent in the form of
preliminary proxy material) with respect to the shares of Firstar (WI) Common
Stock to be issued in the First Step Merger and the Second Step Merger and
shall apply to the NYSE to list the shares of Firstar (WI) Common Stock to be
issued in connection with the transactions contemplated by this Agreement.
The parties shall prepare and file a notice with the Board as soon as
reasonably practicable. The parties shall use all reasonable efforts to cause
the Registration Statement to become effective. The parties shall also take
any action required to be taken under any applicable state blue sky or
securities laws in connection with the issuance of such shares, and Firstar
and Star shall furnish all information concerning their respective
Subsidiaries and the stockholders thereof as may reasonably be requested in
connection with any such action.
(b) The parties hereto shall cooperate with each other and use
their 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 Regulatory Authorities which are
necessary or advisable to consummate the transactions contemplated by this
Agreement (including, without limitation, the First Step Merger and the
Second Step Merger), and to comply with the terms and conditions of all such
permits, consents, approvals and authorizations of all such Regulatory
Authorities. Star and Firstar shall have the right to review in advance, and,
to the extent practicable, each will consult with the other on, in each case
subject to applicable laws relating to the exchange of information, all the
information relating to Star or Firstar, 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 Regulatory Authority in
connection with the transactions contemplated by this Agreement. In
exercising the foregoing right, each of the parties hereto shall act
reasonably and as promptly as practicable. The parties hereto agree that they
will consult with each other with respect to the obtaining of all permits,
consents, approvals and authorizations of all third parties and Regulatory
Authorities 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 the completion of the
transactions contemplated herein.
(c) Star and Firstar shall, upon request, furnish each other with
all information concerning themselves, their Subsidiaries, directors,
officers and stockholders and such other matters as may be reasonably
necessary or advisable in connection with the Proxy Statement, the
Registration Statement or any other statement, filing, notice or application
made by or on behalf of Star, Firstar or any of their respective Subsidiaries
to any Regulatory Authority in connection with the First Step Merger and the
Second Step Merger and the other transactions contemplated by this Agreement.
(d) Star and Firstar shall promptly advise each other upon
receiving any communication from any Regulatory Authority whose consent or
approval is required for consummation of the transactions contemplated by
this Agreement which causes such party to believe that there is a reasonable
likelihood that any requisite approval of any Regulatory Authority will be
denied or materially delayed.
Section 6.3. STOCKHOLDER APPROVAL. In accordance with applicable
law and stock exchange rules and its respective Articles of Incorporation and
By-Laws or Code of Regulations, each of the parties shall call a meeting of
their respective stockholders to be held as soon as practicable after the
Registration Statement is declared effective for the purpose of voting upon
the First Step Merger and the Second Step Merger, as applicable, and to take
any other action for stockholders to authorize the transactions contemplated
by this Agreement (each, a "Meeting"). In connection therewith, the parties
shall prepare the Proxy Statement and, with the approval of each of Star and
Firstar, the Proxy Statement shall be filed with the SEC and mailed to the
respective stockholders of the parties. The parties' respective Boards of
Directors shall submit for approval of their respective stockholders the
matters to be voted upon in order to authorize the Merger. The respective
Board of Directors of the parties shall use their reasonable best efforts to
obtain any vote of their respective stockholders that is necessary for the
approval and adoption of this Agreement and consummation of the transactions
contemplated hereby.
Section 6.4. CURRENT INFORMATION. During the period from the date
of this Agreement to the Effective Time, each party shall promptly furnish
the other with copies of all monthly and other interim financial statements
as the same become available and shall cause one or more of its designated
representatives to confer on a regular and frequent basis with
representatives of the other party. Each party shall promptly notify the
other party of any material change in its business or operations and of any
governmental complaints, investigations or hearings (or communications
indicating that the same may be contemplated), or the institution or, to its
knowledge, the threat of material litigation involving such party, and shall
keep the other party fully informed of such events.
Section 6.5. AGREEMENTS OF AFFILIATES. (a) Not later than the 15th
day prior to the mailing of the Proxy Statement, Firstar shall deliver to
Star and Star shall deliver to Firstar, a schedule of each person that, to
the best of its knowledge, is or is reasonably likely to be, as of the date
of the relevant Meeting, deemed to be an "affiliate" of it (each, an
"Affiliate") as that
term is used in SEC Accounting Series Releases 130 and 135 and Rule 145 under
the Securities Act.
(b) Firstar and Star shall each use its respective reasonable best
efforts to cause each person who may be deemed to be an Affiliate of Firstar
or Star, as the case may be, to execute and deliver to Firstar and Star on or
before the date of their respective Meetings an agreement to comply with SEC
Accounting Series Releases 130 and 135 and with Rule 145 under the Securities
Act. Such agreements shall be in the forms set forth in Exhibit E (in the
case of Firstar) and Exhibit F (in the case of Star).
(c) Firstar (WI) shall use its reasonable best efforts to publish
as promptly as reasonably practical, but in no event later than 45 days after
the end of the first month after the Effective Time in which there are at
least 30 days of post-Merger combined operations (which month may be the
month in which the Effective Time occurs), combined sales and net income
figures as contemplated by and in accordance with the terms of SEC Accounting
Series Release No. 135.
Section 6.6. EXPENSES. Each party hereto shall bear its own
expenses incident to preparing, entering into and carrying out this Agreement
and to consummating the Merger provided that the expenses of Firstar (WI)
related to the preparation, filing and mailing of the Proxy Statement and the
Registration Statement shall be shared equally by the parties.
Section 6.7. SECURITIES ACT AND EXCHANGE ACT FILINGS. (a) Firstar
(WI) shall make all filings with the SEC that are described in Section (c) of
Rule 144 under the Securities Act for a period of two years following the
Effective Time.
(b) The parties shall cause Firstar (WI) to take all corporate
action necessary to reserve for issuance a sufficient number of shares of
Firstar (WI) Common Stock for delivery upon exercise of Star Stock Options
and Firstar Stock Options assumed by it in accordance with Sections 1.6 and
2.6. As soon as practicable after the Effective Time, the parties shall cause
Firstar (WI) to file a registration statement on Form S-3 or Form S-8, as the
case may be (or any successor or other appropriate forms), or another
appropriate form with respect to the shares of Firstar (WI) Common Stock
subject to such options and to use its reasonable best 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 options remain outstanding. With respect to
those individuals who subsequent to the Merger will be subject to the
reporting requirements under Section 16(a) of the Exchange Act, where
applicable, the parties shall cause Firstar (WI) to administer the Star Stock
Plans and Firstar Stock Plans assumed pursuant to Sections 1.6 and 2.6 in a
manner that complies with Rule 16b-3 promulgated under the Exchange Act to
the extent such plans complied with such rule prior to the Merger.
Section 6.8. MISCELLANEOUS AGREEMENTS AND CONSENTS. (a) Subject to
the terms and conditions herein provided, each of the parties hereto agrees
to use its respective reasonable best efforts to take, or cause to be taken,
all action, and to do, or cause to be done, all things necessary, proper or
advisable under applicable laws and regulations to consummate and make
effective the transactions contemplated by this Agreement as expeditiously as
possible, including,
without limitation, using its respective reasonable best efforts to lift or
rescind any injunction or restraining order or other order adversely
affecting the ability of the parties to consummate the transactions
contemplated hereby. Each party shall, and shall cause each of its respective
Subsidiaries to, use its reasonable best efforts to obtain consents of all
third parties necessary or, as agreed to by the parties, desirable for the
consummation of the transactions contemplated by this Agreement.
(b) The parties shall, prior to the Effective Time, (i) consult and
cooperate with each other regarding the implementation of those policies and
procedures to be established by Firstar (WI) for its operations, including,
without limitation, policies and procedures pertaining to the accounting,
asset/liability management, audit, credit, human resources, treasury and
legal functions, and (ii) shall make such modifications or changes to their
policies and practices, if any, and at such date prior to or as of the
Effective Time, as may be mutually agreed upon. Star and Firstar shall also
consult with respect to the character, amount and timing of restructuring
charges to be taken by each of them in connection with the transactions
contemplated hereby and shall take such charges in accordance with GAAP, as
may be mutually agreed upon. No party's representations, warranties and
covenants contained in this Agreement shall be determined to be untrue or
breached in any respect for any purpose as a consequence of any modifications
or changes to such policies and practices which may be undertaken on account
of this Section 6.8(b).
Section 6.9. EMPLOYEE BENEFIT PLANS. (a) From and after the
Effective Time, unless otherwise mutually determined, the Firstar Benefit
Plans and Star Benefit Plans in effect as of the date of this Agreement shall
remain in effect with respect to employees of Firstar or Star (or their
Subsidiaries), respectively, covered by such Plans at the Effective Time
until such time as the Surviving Corporation shall, subject to applicable
law, the terms of this Agreement and the terms of such Plans, adopt new
benefits with respect to employees of the Surviving Corporation and its
Subsidiaries (the "New Benefit Plans"). Prior to the Closing Date, Firstar
and Star shall cooperate in reviewing, evaluating and analyzing the Star
Benefit Plans and Firstar Benefit Plans with a view towards developing
appropriate New Benefit Plans for the employees covered thereby subsequent to
the consummation of the Merger. It is the intention of Firstar and Star to
develop New Benefit Plans, as soon as reasonably practicable after the
Effective Time, which, among other things, (i) treat similarly situated
employees on a substantially equivalent basis, taking into account all
relevant factors, including, without limitation, duties, geographic location,
tenure, qualifications and abilities, and (ii) do not discriminate between
employees of the Surviving Corporation and its Subsidiaries who were covered
by Firstar Benefit Plans, on the one hand, and those covered by Star Benefit
Plans, on the other, at the Effective Time.
(b) The foregoing not withstanding, the Surviving Corporation
agrees to honor in accordance with their terms all benefits vested as of the
date hereof under the Star Benefit Plans or the Firstar Benefit Plans or
under other contracts, arrangements, commitments, or understandings described
in the Star Disclosure Schedule and the Firstar Disclosure Schedule.
(c) Nothing in this Section 6.9 shall be interpreted as preventing
the Surviving Corporation and its Subsidiaries from amending, modifying or
terminating any Star Benefit
Plans, Firstar Benefit Plans, or other contracts, arrangements, commitments
or understandings, in accordance with their terms and applicable law.
Section 6.10. D&O INDEMNIFICATION. (a) In the event of any
threatened or actual claim, action, suit, proceeding or investigation,
whether civil, criminal or administrative, including, without limitation, 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 or officer of Star,
Firstar, Firstar (WI), Merger Sub or any of their respective Subsidiaries,
including any entity specified in the Star Disclosure Schedule or the Firstar
Disclosure Schedule (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 or officer of
Star, Firstar, Firstar (WI), Merger Sub or any of their respective
Subsidiaries or any entity specified in the Star Disclosure Schedule or the
Firstar Disclosure Schedule or any of their respective predecessors or (ii)
this Agreement, the Option Agreements or any of the transactions contemplated
hereby or thereby, whether in any case asserted or arising before or after
the Effective Time, the parties hereto agree to cooperate and use their best
efforts to defend against and respond thereto. It is understood and agreed
that after the Effective Time, Firstar (WI) shall indemnify and hold
harmless, as and to the fullest extent permitted by law, each such
Indemnified Party against any losses, claims, damages, liabilities, costs,
expenses (including reasonable attorney's fees and expenses), judgments,
fines and amounts paid in settlement in connection with any such threatened
or actual claims, action, suit, proceeding or investigation; and in the event
of any such threatened or actual claim, action, suit, proceeding or
investigation (whether asserted or arising before or after the Effective
Time); Firstar (WI), after consultation with an Indemnified Party, shall
retain counsel and direct the defense thereof, PROVIDED, HOWEVER, that by
virtue of the obligations herein set forth, (A) Firstar (WI) shall not be
liable to any Indemnified Party for any legal expenses of other counsel or
any other expenses incurred by any Indemnified Party in connection with the
defense thereof, except that if Firstar (WI) fails or elects not to assume
such defense or counsel for the Indemnified Parties reasonably advises the
Indemnified Parties that there are issues which raise conflicts of interest
between Firstar (WI) and the Indemnified Parties, the Indemnified Parties may
retain counsel reasonably satisfactory to them after consultation with
Firstar (WI), and Firstar (WI) shall pay the reasonable fees and expenses of
such counsel for the Indemnified Parties promptly as statements therefor are
received, (B) Firstar (WI) shall be obligated pursuant to this paragraph to
pay for only one firm of counsel (in addition to local counsel in each
applicable jurisdiction) for all Indemnified Parties, unless an Indemnified
Party shall have reasonably concluded, based on the advice of counsel and
after consultation with Firstar (WI), that in order to be adequately
represented, separate counsel is necessary for such Indemnified Party, in
which case, Firstar (WI) shall be obligated to pay for such separate counsel,
(C) Firstar (WI) shall not be liable for any settlement effected without its
prior written consent (which consent shall not be unreasonably withheld) and
(D) Firstar (WI) shall have no obligation hereunder to any Indemnified Party
when and if a court of competent jurisdiction shall ultimately determine, and
such determination shall have become final and nonappealable, that
indemnification of such Indemnified Party in the manner contemplated hereby
is prohibited by applicable law. Firstar (WI) shall, to the fullest extent
permitted by law, advance expenses to such Indemnified Parties prior to final
disposition of any claim, suit, proceeding, or investigation upon receipt of
an undertaking to repay any such advances of fees
and expenses if such person is ultimately found not to be entitled to
indemnification therefor. Any Indemnified Party wishing to claim
Indemnification under this Section 6.10, upon learning of any such claim,
action, suit, proceeding or investigation, shall notify Firstar (WI) thereof,
provided that the failure to so notify shall not affect the obligations of
Firstar (WI) under this Section 6.10 except to the extent such failure to
notify materially prejudices Firstar (WI). Firstar (WI)'s obligations under
this Section 6.10 shall continue in full force and effect for a period of six
years from the Effective Time (or the period of the applicable statute of
limitations, if longer); PROVIDED, HOWEVER, that all rights to
indemnification in respect of any claim (a "Claim") asserted or made within
such period shall continue until the final disposition of such Claim.
(b) From and after the Effective Time, the parties shall cause
Firstar (WI) to cause the individuals serving as officers and directors of
Star and Firstar, their respective Subsidiaries or any entity specified in
the Star Disclosure Schedule or the Firstar Disclosure Schedule immediately
prior to the Effective Time to be covered for a period for six (6) years from
the Effective Time (or the period of the applicable statute of limitations,
if longer) by the directors' and officers' liability insurance policies
maintained by Star and Firstar, as applicable (PROVIDED that Firstar (WI) may
substitute therefor policies of at least the same coverage and amounts
containing terms and conditions which are not less advantageous than either
of such policies) with respect to acts or omissions occurring prior to the
Effective Time which were committed by such officers and directors in their
capacity as such; PROVIDED, HOWEVER, that in no event shall Firstar (WI) be
required to expend more than 200% of the current amount expended by Star and
Firstar (the "Insurance Amount") to maintain or procure insurance coverage
pursuant hereto and provided further that if Firstar (WI) is unable to
maintain or obtain the insurance called for in this Section 6.10(b), Firstar
(WI) shall use its reasonable best efforts to obtain as much comparable
insurance as available for the Insurance Amount).
(c) In the event Firstar (WI) or any of its successors or assigns
(i) consolidates with or merges into any other person and shall not be the
continuing or surviving corporation or entity of such consolidation or
merger, or (ii) transfers or conveys all or substantially all of its
properties and assets to any person, then, and in each such case, to the
extent necessary, proper provision shall be made so that the successors and
assigns of Firstar (WI) assume the obligations set forth in this section.
(d) The provisions of this Section 6.10 are intended to be for the
benefit of, and shall be enforceable by, each Indemnified Party and his or
her heirs and representatives.
Section 6.11. PRESS RELEASES. Except as may be required by law,
Firstar and Star shall consult and agree with each other as to the form,
substance and timing of any proposed press release relating to this Agreement
or any of the transactions contemplated hereby.
Section 6.12. POOLING OF INTERESTS. Each of Star, Firstar and
Firstar (WI) undertakes and agrees to use its reasonable best efforts to
cause (i) each of the First Step Merger and the Second Step Merger to qualify
as a "reorganization" within the meaning of Section 368(a) of the Code, (ii)
the Merger to qualify as a "pooling of interests" for accounting and
financial reporting purposes (in the case of both clause (i) and clause (ii),
including, if necessary, to take rea-
sonable steps to restructure the transactions contemplated by this Agreement
to so qualify and, in the case of qualification as a "pooling of interests,"
including, if necessary, seeking any necessary third party consents) and
(iii) the Merger to occur as soon as practicable.
Section 6.13. INSURANCE. Each of Star and Firstar shall, and each
shall cause its respective Subsidiaries to, use its reasonably best efforts
to maintain its existing insurance.
Section 6.14. CONFORMING ENTRIES. (a) From and after the date of
this Agreement, Firstar and Star shall consult and cooperate with each other
with respect to conforming the loan, accrual and reserve policies of Firstar
and the Firstar Subsidiaries and such policies of Star and the Star
Subsidiaries to each other.
(b) In addition, from and after the date of this Agreement to the
Effective Time, Firstar and Star shall consult and cooperate with each other
with respect to determining appropriate Firstar and Star accruals, reserves
and charges to establish and take in respect of excess equipment write-off or
write-down of various assets and other appropriate charges and accounting
adjustments taking into account the parties' business plans following the
Merger, based upon such consultation and as hereinafter provided.
(c) Firstar and Star shall consult and cooperate with each other
with respect to determining, based upon such consultation and as hereinafter
provided, the amount and the timing for recognizing for financial accounting
purposes each party's expenses of the Merger and the restructuring charges
relating to or to be incurred in connection with the Merger.
(d) To the extent permissible under applicable laws, regulations,
and requirements of Regulatory Authorities, and provided further, that
neither Firstar nor Star shall be required to take any such action that, in
the opinion of its independent auditors, is not consistent with GAAP and
regulatory accounting principles if after consultation Firstar and Star
agree, Firstar and Star shall (i) establish and take such reserves and
accruals at such time as are agreed to conform Firstar's and Star's loan,
accrual and reserve policies to the other party's policies, and (ii)
establish and take such accruals, reserves and charges in order to implement
such policies in respect of excess facilities and equipment capacity,
severance costs, litigation matters, write-off or write-down of various
assets and other appropriate accounting adjustments, and to recognize for
financial accounting purposes such expenses of the Merger and restructuring
charges related to or to be incurred in connection with the Merger.
Section 6.15. ADDITIONAL ACTIONS. In case at any time after the
First Effective Time any further action is necessary or desirable to carry
out the purposes of this Agreement or to vest the Surviving Corporation with
full title to all properties, assets, rights, approvals, immunities and
franchises of any of the parties to the First Step Merger or the Second Step
Merger, as the case may be, the proper officers and directors of each party
to this Agreement and their respective Subsidiaries shall take all such
action as may be reasonably necessary.
Section 6.16. DIVIDENDS. (a) After the date of this Agreement, each
of Star and Firstar shall coordinate with the other the payment of dividends
with respect to the Star Common Stock and the Firstar Common Stock and the
record dates and payment dates relating thereto, it
being the intention of the parties hereto that holders of Star Common Stock
and Firstar Common Stock shall not receive two dividends, or fail to receive
one dividend, in any single calendar quarter with respect to their shares of
Star Common Stock and/or Firstar Common Stock or any shares of Firstar (WI)
Common Stock that any such holder receives in exchange for such shares of
Star Common Stock or Firstar Common Stock in the Merger.
(b) It is the intention of the parties that the initial post-
closing quarterly dividend rate per share of Firstar (WI) Common Stock shall
be equal to the quarterly dividend rate per share of Firstar immediately
prior to Closing divided by 0.76.
Section 6.17. ISSUANCE OF SHARES. If and to the extent necessary to
reduce the aggregate number of "tainted treasury shares" to a number that is
consistent with the accounting of the Merger as a "pooling of interests"
under GAAP each of Star and Firstar shall, prior to the First Effective Time,
coordinate with the other party with respect to the issuance of, and pursuant
thereto shall issue, shares of Star Common Stock or Firstar Common Stock, as
may be appropriate, in such manner, and limited to such number, as is
necessary.
Section 6.18. CHANGES IN STRUCTURE. The structure of the Merger
shall be changed at the request of either Firstar or Star delivered prior to
the First Effective Time (without any further required action by the parties)
to provide for a merger of (i) Firstar with and into Firstar (WI) in the
First Step Merger and (ii) Star with and into Firstar (WI) in the Second Step
Merger, with Firstar (WI) as the surviving corporation in the Merger,
continuing its corporate existence under the name "Firstar Corporation" and
continuing to be governed by the laws of the State of Wisconsin (with
corresponding changes to the definitions set forth in the first recital to
this Agreement), provided that such change in structure does not change the
Exchange Ratio, the tax consequences or any of the other substantive terms of
the transactions contemplated by this Agreement. In the event that the
structure of the Merger is changed pursuant to the provisions of this Section
6.18, Articles I and II as set forth in Exhibit 6.18 hereto shall become
Articles I and II of this Agreement, along with such other conforming changes
to this Agreement as the parties may agree in good faith are required,
including the deletion of all references to Merger Sub. If the structure of
the Merger is revised in accordance with this Section 6.18, then the
appropriate documents filed in respect of the First Step Merger with the
Department of Financial Institutions of the State of Wisconsin and the
appropriate documents filed in respect of the Second Step Merger with the
Department of Financial Institutions of the State of Wisconsin and the
Secretary of State of the State of Ohio pursuant to Sections 1.2 and 2.2,
respectively, shall reflect that the structure of the Merger has been revised
in accordance with this Section 6.18.
Section 6.19. AMENDING GOVERNANCE DOCUMENTS. The parties agree that
they will take whatever action is necessary to amend the Articles of
Incorporation and By-Laws of Firstar (WI) such that at the Effective Time
such Articles of Incorporation and Bylaws are substantially identical to the
forms attached hereto as Exhibit C and Exhibit D, respectively.
Section 6.20. BOARD OF DIRECTORS; MANAGEMENT. (a) Prior to the
First Effective Time, Firstar shall elect a board of directors of Firstar
(WI) to be comprised of 32 persons, 18 of whom shall be named by the Board of
Directors of Star and 14 of whom shall be named by the
Board of Directors of Firstar, and such directors shall be allocated among
the three classes of directors in a proportionate manner. From and after the
First Effective Time, until duly changed pursuant hereto or in accordance
with applicable law, the officers of Firstar shall be the officers of Firstar
(WI).
(b) Firstar shall cause all requisite action to be taken so that,
at the Effective Time, directors of Firstar (WI) elected pursuant to this
Section at the designation of Star and Firstar shall be represented in
proportion to the aggregate representation set forth in this Section on all
committees of the Board of Directors of Firstar (WI), except that seven
designees of Star and five designees of Firstar shall be included on the
Executive Committee.
ARTICLE VII
CONDITIONS
Section 7.1. CONDITIONS TO EACH PARTY'S OBLIGATION TO EFFECT THE
MERGER. The respective obligations of each party to effect the Merger shall
be subject to the fulfillment at or prior to the First Effective Time of the
following conditions:
(a) This Agreement and the transactions contemplated hereby,
including the Second Step Merger, and, in the case of the holders of Firstar
Common Stock, the First Step Merger, shall have been approved and adopted by
the respective requisite affirmative votes of the holders of Star Common
Stock and Firstar Common Stock entitled to vote thereon.
(b) All requisite approvals of this Agreement and the transactions
contemplated hereby shall have been received from the Board and any other
Regulatory Authority, and all applicable waiting periods shall have expired
under applicable law (other than any such approvals or the expiration of any
such waiting periods which the failure to obtain or satisfy, individually or
in the aggregate, would not reasonably be expected to have a material adverse
effect on the consummation of the Merger or a Material Adverse Effect on the
Surviving Corporation).
(c) The Registration Statement shall have been declared effective
and shall not be subject to a stop order or any threatened stop order.
(d None of Firstar, Star, Merger Sub nor Firstar (WI) shall be
subject to any order, decree injunction, of a court or agency of competent
jurisdiction which enjoins or prohibits the consummation of the Merger, the
First Step Merger, the Second Step Merger or any of the other transactions
contemplated by this Agreement. No statute, rule, regulation, order,
injunction or decree shall have been enacted, entered, promulgated or
enforced by any Regulatory Authority which prohibits, materially restricts or
makes illegal consummation of the First Step Merger or the Second Step
Merger.
(e) Star shall have received an opinion of Wachtell, Lipton, Xxxxx
& Xxxx and Firstar shall have received an opinion of Xxxxxxx Xxxxxxx &
Xxxxxxxx, in form and substance reasonably satisfactory to Star and Firstar,
respectively, dated the Closing Date, substantially to the
effect that, on the basis of facts, representations and assumptions set forth
in such opinion which are consistent with the state of facts existing at the
Effective Time:
(i) Each of the First Step Merger and the Second Step Merger will
constitute a reorganization under Section 368(a) of the Code; Firstar,
Merger Sub and Firstar (WI) will each be a party to the reorganization
in respect of the First Step Merger; and Firstar, Firstar (WI) and Star
will each be a party to the reorganization in respect of the Second
Step Merger;
(ii) No gain or loss will be recognized by Firstar, Firstar (WI)
or Merger Sub as a result of the First Step Merger or by Firstar,
Firstar (WI) or Star as a result of the Second Step Merger;
(iii) No gain or loss will be recognized by stockholders of Firstar
who exchange their Firstar Common Stock solely for Firstar (WI) Common
Stock pursuant to the First Step Merger (except with respect to cash
received in lieu of a fractional share interest in Firstar (WI) Common
Stock); and
(iv) No gain or loss will be recognized by the stockholders of Star
who exchange their Star Common Stock solely for Firstar (WI) Common
Stock pursuant to the Second Step Merger.
In rendering such opinion, counsel may require and rely upon
representations contained in certificates of officers of Firstar, Firstar
(WI), Star and others.
(f) The shares of Firstar (WI) Common Stock which shall be issued
to the holders of Star Common Stock and Firstar Common Stock (and, where
applicable, Firstar (WI) Stock Options) upon consummation of the Merger shall
have been authorized for listing on the NYSE, subject to official notice of
issuance.
(g) Star and Firstar shall have received letters, in form and
substance reasonably satisfactory to each, from Xxxxxx Xxxxxxxx LLP and KPMG
Peat Marwick LLP, respectively, dated the date of the Proxy Statement and
confirmed in writing at the Effective Time, stating that the First Step
Merger and Second Step Merger, taken together, will qualify as a "pooling of
interests" transaction under Opinion 16 of the Accounting Principles Board,
the interpretive releases issued pursuant thereto and the pronouncements of
the SEC thereon.
Section 7.2. CONDITIONS TO OBLIGATIONS OF FIRSTAR TO EFFECT THE
MERGER. The obligations of Firstar to effect the Merger shall be subject to
the fulfillment or waiver by Firstar at or prior to the First Effective Time
of the following additional conditions:
(a) REPRESENTATIONS AND WARRANTIES. The representations and
warranties of Star set forth in Article IV of this Agreement shall be true
and correct, subject to the standard of Section 4.2, as of the date of this
Agreement and as of the Closing Date (as though made on and as of the Closing
Date except (i) to the extent such representations and warranties are by
their express provisions made as of a specified date or period and (ii) for
the effect of transactions con
templated by this Agreement) and Firstar shall have received a certificate of
the chairman or president of Star, on behalf of Star, to that effect.
(b) PERFORMANCE OF OBLIGATIONS. Star 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 Firstar shall have received a
certificate of the chairman or president of Star, on behalf of Star, to that
effect.
Section 7.3. CONDITIONS TO OBLIGATIONS OF STAR TO EFFECT THE
MERGER. The obligations of Star to effect the Merger shall be subject to the
fulfillment or waiver by Star at or prior to the First Effective Time of the
following additional conditions:
(a) REPRESENTATIONS AND WARRANTIES. The representations and
warranties of Firstar set forth in Article IV of this Agreement shall be true
and correct, subject to the standard of Section 4.2, as of the date of this
Agreement and as of the Closing Date (as though made on and as of the Closing
Date except (i) to the extent such representations and warranties are by
their express provisions made as of a specific date or period and (ii) for
the effect of transactions contemplated by this Agreement) and Star shall
have received a certificate of the chairman or president of Firstar, on
behalf of Firstar, to that effect.
(b) PERFORMANCE OF OBLIGATIONS. Firstar 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 Star shall have received
a certificate of the chairman or president of Firstar, on behalf of Firstar,
to that effect.
(c) CONSUMMATION OF THE FIRST STEP MERGER. The First Effective Time
shall have occurred and the First Step Merger shall have been consummated.
ARTICLE VIII
TERMINATION, AMENDMENT AND WAIVER
Section 8.1. TERMINATION. This Agreement may be terminated at any
time prior to the First Effective Time, whether before or after any requisite
stockholder approval:
(a) by mutual written consent by the Board of Directors of Star,
the Board of Directors of Firstar, the Board of Directors of Merger Sub and
the Board of Directors of Firstar (WI);
(b) by the Board of Directors of Star or the Board of Directors of
Firstar at any time after the date that is twelve months after the date of
this Agreement if the Merger shall not theretofore have been consummated
(provided that the terminating party is not then in material breach of any
representation, warranty, covenant or other agreement contained herein which
has resulted in the delay in performance of this Agreement);
(c) by the Board of Directors of Star or the Board of Directors of
Firstar if (i) the Board has denied approval of the Merger and such denial
has become final and nonappealable, (ii) stockholders of Firstar shall not
have approved the Merger and the other actions contemplated by this Agreement
at the Meeting provided that Firstar has not breached its obligation under
Section 6.3 or (iii) stockholders of Star shall not have approved the Merger
and the other transactions contemplated by this Agreement at the Meeting
provided that Star has not breached its obligation under Section 6.3;
(d) by the Board of Directors of Star in the event of a breach by
Firstar of any representation or warranty (subject to the standard of Section
4.2), or any covenant or other agreement (in any material respect), contained
in this Agreement which breach is not cured within 90 days after written
notice thereof to Firstar by Star; or
(e) by the Board of Directors of Firstar in the event of a breach
by Star of any representation or warranty (subject to the standard of Section
4.2), or any covenant or other agreement (in any material respect), contained
in this Agreement which breach is not cured within 90 days after written
notice thereof is given to Star by Firstar.
Section 8.2. EFFECT OF TERMINATION. In the event of termination of
this Agreement pursuant to this Article VIII, this Agreement shall forthwith
become void and there shall be no liability or obligation of any nature
whatsoever hereunder, or in connection with the transactions contemplated
hereby, on the part of Star, Firstar or their respective Subsidiaries or
their respective officers or directors except (i) as set forth in the second
sentence of Section 6.1 and in Section 4.3(j), 6.6, 8.2 and 9.3, (ii) that
termination will not relieve a breaching party from liability for any willful
breach of this Agreement giving rise to such termination and (iii) each of
the Option Agreements shall be governed by its own terms as to termination.
Section 8.3. AMENDMENT. This Agreement and the Schedules hereto may
be amended by the parties hereto, by action taken by or on behalf of their
respective Boards of Directors, at any time before or after approval of this
Agreement by the stockholders of Firstar, Star, Merger Sub and Firstar (WI);
PROVIDED, HOWEVER, that after any such approval no such amendment which under
applicable law requires further stockholder approval may be made without such
stockholder approval. This Agreement may not be amended except by an
instrument in writing signed on behalf of each of Star, Firstar, Merger Sub
and Firstar (WI).
Section 8.4. SEVERABILITY. Any term, provision, covenant or
restriction contained in this Agreement held by a court or a Regulatory
Authority of competent jurisdiction or the Board to be invalid, void or
unenforceable shall be ineffective to the extent of such invalidity, voidness
or unenforceability, but neither the remaining terms, provisions, covenants
or restrictions contained in this Agreement nor the validity or
enforceability thereof in any other jurisdiction shall be affected or
impaired thereby. Any term, provision, covenant or restriction contained in
this Agreement that is so found to be so broad as to be unenforceable shall
be interpreted to be as broad as is enforceable.
Section 8.5. WAIVER. Any term, condition or provision of this
Agreement may be waived in writing at any time by the party which is, or
whose stockholders are, entitled to the benefits thereof.
ARTICLE IX
GENERAL PROVISIONS
Section 9.1. CLOSING. The closing (the "Closing") of the Merger
shall take place at 10:00 a.m., local time, on the date that the Effective
Time (as defined in Section 2.2) occurs, or at such other time, and at such
place, as Star and Firstar shall agree (the "Closing Date").
Section 9.2. NON-SURVIVAL OF REPRESENTATIONS, WARRANTIES AND
AGREEMENTS. No investigation by the parties hereto made heretofore or
hereafter shall affect the representations and warranties of the parties
which are contained herein and each such representation and warranty shall
survive such investigation. Except as set forth below in this Section 9.2,
all representations, warranties and agreements in this Agreement of Star and
Firstar or in any instrument delivered by Star or Firstar pursuant to or in
connection with this Agreement shall expire at the Effective Time or upon
termination of this Agreement in accordance with its terms or, in the case of
any other such instrument, in accordance with the terms of such instrument;
provided that, in the event of consummation of the Merger, the covenants and
agreements contained in or referred to in Sections 6.6 and 6.10 and those
covenants and agreements contained herein which by their terms apply in whole
or in part after the Effective Time shall survive the Effective Time.
Section 9.3. NOTICES. All notices and other communications
hereunder shall be in writing and shall be deemed to be duly received (i) on
the date given if delivered personally, (ii) upon confirmation of receipt, if
by facsimile transmission, (iii) on the date received if mailed by registered
or certified mail (return receipt requested), or (iv) on the business date
after being delivered to a reputable overnight delivery service, if by such
service, to the parties at the following addresses (or at such other address
for a party as shall be specified by like notice):
(i) if to Star:
Star Banc Corporation
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxx 00000
ATTN: Xxxxx Xxxxxxx
Telecopier: (000) 000-0000
Copies to:
Xxxxx X. Xxxxxxxxx
Wachtell, Lipton, Xxxxx & Xxxx
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier: (000) 000-0000
(ii) if to Firstar, Firstar (WI) or Merger Sub:
Firstar Corporation
Firstar Center
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
ATTN: Xxxxxx X. Xxxxxxx, III
Telecopier: (000) 000-0000
Copies to:
Xxxx X. Xxxxxxxx
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier: (000) 000-0000
Xxxxx X. Xxxxxxx, Xx.
Xxxxx & Xxxxxxx
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Telecopier: (000) 000-0000
Section 9.4. INTERPRETATION. When a reference is made in this
Agreement to Sections, Exhibits or Schedules, such reference shall be to a
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". No provision of this Agreement shall be
construed to require Firstar, Star, Merger Sub, Firstar (WI) or any of their
respective Subsidiaries or affiliates to take or fail to take any action,
including, without limitation, the disclosure or non-disclosure by either
party of any information to its stockholders, which would (or its failure to
have been taken would) reasonably be expected to violate any applicable law,
legal duty, rule or regulation.
Section 9.5. MISCELLANEOUS. This Agreement (including the
Disclosure Schedules and Schedules and other written documents referred to
herein or provided hereunder) (i) constitutes the entire agreement and
supersedes all other prior agreements and understandings, both written and
oral, among the parties, or any of them, with respect to the subject matter
hereof, other than any confidentiality agreement between the parties hereto,
(ii) except with respect to Section 6.10 is not intended to confer upon any
person not a party hereto any rights or remedies hereunder, (iii) shall not
be assigned by operation of law or otherwise, (iv) may be executed in
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
parities and delivered to the other parties, it being understood that all
parties need not sign the same counterparts, and (v) shall be governed in all
respects by the laws of the State of New York, except as otherwise
specifically
provided herein or required by the OGCL or the WBCL. This Agreement may be
delivered by facsimile. Subject to the preceding clause (iii), this Agreement
will be binding upon, inure to the benefit of and be enforceable by the
parties and their respective successors and assigns.
IN WITNESS WHEREOF, the undersigned have caused this Agreement to
be signed as of the date first written above.
STAR BANC CORPORATION
By:/s/ XXXXX X. XXXXXXXXXX
Name: Xxxxx X. Xxxxxxxxxx
Title: Chairman of the Board,
President and Chief
Executive Officer
FIRSTAR CORPORATION
By:/s/ XXXXX X. XXXXXXXXXXX
Name: Xxxxx X. Xxxxxxxxxxx
Title: Chairman and Chief
Executive Officer
FIRSTAR (WI) CORPORATION
By:/s/ XXXXX X. XXXXXXXXXXX
Name: Xxxxx X. Xxxxxxxxxxx
Title: Chairman and Chief
Executive Officer
FIRSTAR MERGER CORPORATION
By:/s/ XXXXX X. XXXXXXXXXXX
Name: Xxxxx X. Xxxxxxxxxxx
Title: Chairman and Chief
Executive Officer
