Regional Banks

Developments

Republic Bancorp to merge with Citizens Banking

Sovereign closes controversial Independence acquisition

Regions Financial to merge with AmSouth

Wachovia to buy Golden West

Capital One to buy North Fork Bancorp

TD Banknorth closes Hudson United Bancorp

Santander invests in Sovereign Bancorp;
Sovereign to buy Independence Community Bank

Zions Bancorp buys Amegy Bancorp for $1.7 billion

BancWest (BNP Paribas) to buy Commercial Federal

Capital One buys Hibernia

Marshall & Ilsley buys employee benefits debit card

SunTrust fined by NASD over new analyst rule

Wachovia acquires SouthTrust

Select Companies

Regional Banks - From Nasdaq site

Notable Transactions

Republic Bancorp / Citizens Banking Stock - Cash Merger

Combines two Michigan-based banking companies

Citizens Republic Bancorp
$1.05B in stock and cash

$2.08 plus 0.4378 CBCF share per RBNC share
85% stock; 15% cash

Advisors

Citizens: UBS / Wachtell Lipton
Republic: Goldman / Cadwalader

Announced 6.27.06

AmSouth / Regions Financial Stock Merger

Merger of two Alabama-based banking companies

Creates a top ten US bank with a $26B market cap

Deal has been long rumored, because of geographic overlap

Both companies are headquartered in Birmingham AL

Deal terms

Fixed exchange ratio: 0.7974 RF share per ASO share
62% Regions, 38% AmSouth pro forma ownership
Keeps Regions Financial name
Direct merger of Amsouth into Regions

Post-merger corporate governance

Regions CEO to be Chairman; AmSouth CEO to be CEO
12 Regions directors ; 9 AmSouth directors
Protected by supermajority by-law provisions

Deal protection:

Reciprocal 19.9% stock option agreements
Proxy statement description

Deal has been long rumored, because of geographic overlap

Both companies are headquartered in Birmingham AL

Advisors

RF: Merrill / Morgan Keegan / Wachtell Lipton
ASO: Goldman / Sullivan & Cromwell

Announced 5.25.06

Proxy solicitation

Form S-4 7.12.06

Agreements

Golden West / Wachovia Stock - Cash Merger

Wachovia to buy 2nd largest US savings institution

For $25.5B in stock and cash

$81.07 per GDW share
1.051 WB share, plus $18.65
77% stock; 23% cash
GDW stock chart WB stock chart

Expands Wachovia's mortgage business

BusinessWeek article

Co-CEOs and a director enter into voting agreements

Advisors

WB: Merrill / Wachovia Securities / Sullivan & Cromwell
GDW: Lehman / Wachtell Lipton

Announced 5.08.06

Proxy solicitation

Form S-4 6.01.06

Table of contents

Agreements

North Fork / Capital One Cash Election Merger

Credit card specialist acquires leading regional bank

For $14.6B in stock and cash

$31.18 per NFB share
64% stock - 36% cash
Cash election merger; subject to proration
NFB stock chart COF stock chart

Creates one of the 10 largest US banks

Follows COF's 2005 acquisition of another bank, Hibernia
Further diversifying COF's credit card business

News items:
Reciprocal 19.9% lock-up stock option agreements

Caps grantee's total profit at $730 mm

Advisors

COF: JP Morgan / Citigroup / Cleary Gottlieb
NFB: Sandler ONeil / Keefe Bruyette / Wachtell Lipton

Announced 3.12.06

Proxy solicitation

Form S-4 5.01.06

Table of contents

Agreements

Merger agreement
Lock-up stock option agreement - COF issued
Lock-up stock option agreement - NFB issued

Independence / Sovereign / Santander Acquisition-Investment

Strategic investment supports acquisition

Santander (Spain) takes 19.8% stake in Sovereign

$2.4 billion investment
Priced at $27 per share
24% premium to SOV 20-day average
Elaborate five-year standstill arrangement
SOV stock chart

Sovereign to buy Independence Community Bank

$3.6 billion acquisition, at $42 per share
Immediately accretive to SOV GAAP and cash earnings
SOV's move into New York City connects its
Mid-Atlantic and New England footprints
ICBC stock chart
ICBC shareholders approve 1.25.06

Response to threatened proxy fight

See Proxy Fights
Investment and acquisition were structured
to avoid a Sovereign shareholder vote
Relational Investors challenged this

Letter to NYSE 11.08.05

NYSE required changes to terms of investment

Summary of changes made
Investment agreement amendment 11.22.05
See NYSE Rule 312

Advisors

Sovereign: Citigroup / Stevens & Lee
ICBC: Merrill / Lehman / Simpson Thacher
Santander: Davis Polk

Announced 10.24.05

Summarizes terms including standstill

Slide presentation

Closed 6.01.06

ICBC Form 15
Closing scheduled 5.26.06

Agreements

Article 8 includes standstill provisions

Investment agreement amendment 11.22.05

Changes made to satisfy NYSE requirements
Summary of changes made
See NYSE Rule 312

Rights agreement amendment

Proxy solicitation

Definitive proxy statement 12.20.05

Preliminary proxy statement 11.29.05

Activist shareholder criticizes proxy disclosures 12.06.05

Interim communications

Investor presentation 12.08.05
Sovereign investor presentation 11.02.05
Sovereign press release 11.02.05
Relational's response 11.02.05

Hudson United / TD Banknorth Cash Election Merger

Maine-based bank acquires New Jersey-based bank

For $1.9 billion in stock and cash
Extends TD's footprint; Minimal current branch overlap
Expected to close January 2006

Deal terms

$21.07 plus fraction TD share (floating exchange),
per HUBCO share (51% stock - 49% cash)
Valued at $42.78 per HUBCO share on announcement
Cash portion to be raised through TD's majority stockholder
Toronto-Dominion Bank (Canada)
Direct statutory merger (NJ ≥ DE) Cash election merger

Advisors

TD Banknorth: Lehman / Elias Matz
HUBCO: Keefe Bruyette / Pitney Hardin

Announced 7.12.05

Closed 2.01.06

Proxy solicitation

Form S-4 Amendment #1 10.28.05

Form S-4 9.12.05

Customer information statement 9.26.05

Agreements

Merger agreement

Notable provisions

Table of contents
Merger consideration - Cash election (Article III)
Treatment of HUBCO options (§ 3.6)
HUBCO SEC filings representation (§ 4.5)
HUBCO shareholder vote covenant (§ 7.3)
No shop covenant (§ 7.4)
Break-up fee - $60 million (§ 9.2)

Covering Form 8-K

Interim communications

Conference call transcript 9.27.05
Results of cash election 1.27.06

Amegy Bancorp / Zions Bancorp Cash Election Merger

Zions expands into Texas

Acquires largest independent bank in Houston
For $1.7 billion in stock and cash
Valued at $23.32 per Amegy share
Compass Bancshares (AL) was cover bidder
Background

Deal terms

65% stock / 35% cash
Can elect cash, subject to proration
$60 million break-up fee
Cash EPS accretive in 2006
GAAP EPS accretive in 2007
Forward triangular merger Cash election merger

Advisors

Zions: Lehman / Pillsbury Winthrop
Amegy: Goldman / Sandler O'Neill / Sullivan & Cromwell

Announced 7.06.05

Closed 12.06.05

Proxy solicitation

Definitive proxy statement 9.06.05

Form S-4 Amendment #1 9.02.05
Form S-4 8.17.05

Agreements

Merger agreement

Commercial Federal / BancWest (BNP Paribas) Cash Merger

BancWest buys Omaha-based thrift

BNP Paribas subsidiary to buy 12th largest US thrift
$34 per share, $1.36 billion total
CFB stock price
CFB shareholders approve 11.01.05

Advisors

BancWest: Pillsbury Winthrop
CFB: Merrill Lynch / Sandler O'Neill / Wachtell Lipton

Announced 6.13.05

Closed 1.25.06

Proxy solicitation

Definitive proxy statement 9.20.05

Amendment #1 8.19.05
Preliminary proxy statement 7.25.05

Agreements

Hibernia / Capital One Cash Election Merger

Credit card company acquires banking company

$5.3 billion, stock and cash

Helps diversify buyer's funding sources
by providing access to consumer deposits

Background
Closing delayed because of Hurricane Katrina 8.31.05

Deal terms renegotiated because of Hurricane Katrina

Price cut by 9%
Expect to close in 4th quarter 2005
Revision subject to Hibernia shareholder approval
Joint press release 9.07.05
Cash elections cancelled 9.08.05
Blackout notice terminated 9.13.05
Analyst conference call 9.15.05
Troubled Deal

Deal terms

After revision

55% stock / 45% cash
Valued at $30.49 on announcement

Before revision

55% stock / 45% cash
Valued at $33.00 on announcement

Buyer (DE) / Target (LA)
Direct statutory merger with cash election
Hibernia Chairman to join Capital One board

Advisors

Capital One: CSFB / Cleary Gottlieb
Hibernia: JP Morgan / Bear Stearns / Wachtell Lipton

Announced 3.06.05

Closed 11.16.05

Agreements

Merger agreement
Affiliate letter (Rule 145)
Notable provisions

Conversion of Hibernia stock - §1.4
Proration - §1.5
Cash election procedure - §2.1
Treatment of stock options - §1.6
Seller rep on internal controls, disclosure controls, etc.
§ 3.6(c/d)
Seller rep on derivatives - §3.14
Buyer rep on internal controls, disclosure controls, etc.
§ 4.6(c/d)
Regulatory approval covenant - § 6.1
No shop covenant - § 6.11
Break-up fee of $220 million (4%) - § 8.3(b)

Merger agreement amendment 9.06.05

Proxy Solicitation

Form S-4 4.28.05

Capital One (DE)
Hibernia (LA)

Fairness opinions

Seller: JP Morgan

Seller: Bear Stearns

Proxy statement disclosure
Opinion
$4,240,000 success fee

Interim communications

Federal Reserve Board approves 8.16.05
Trading blackout extended 11.14.05
Cash election results 11.14.05

SouthTrust / Wachovia Stock Merger

Creates #1 banking company in the Southeast

$14.3 billion, all stock
Background of the Merger

Deal terms

Fixed exchange: 0.89 WE share, per SOTR share
Direct merger of SouthTrust (DE) into Wachovia (NC)
Plan $1.7 billion in additional share repurchases
Accretive to Cash EPS in two years
19.5% stock lock-up option
Three SouthTrust directors to join Wachovia board
SouthTrust sells credit card portfolio to MBNA

Advisors

Wachovia: UBS / Sullivan & Cromwell
SouthTrust: Merrill Lynch / Bradley Arant / Burr & Forman

Announced 6.21.04

Closed 11.01.04

Joint press release

Agreements

SOTR nominees to Wachovia board: §2.06
Treatment of stock options: §3.07
Representations and warranties: Article V
No shop covenant: §6.06
Post-merger indemnification of SOTR management: §6.12
Termination: §8.01

Proxy Solicitation

Final proxy statement 9.27.04

Wachovia (NC)
SouthTrust (DE)

Shareholder litigation

Fairness Opinions

Buyer: UBS Securities LLC

Proxy statement disclosure
Opinion
$15 million success fee

Seller: Merrill Lynch

Proxy statement disclosure
Opinion
$17.5 million success fee

Interim Communications

Shareholder approval 10.28.04
SouthTrust divests 18 branches 10.12.04
Slide presentation 9.13.04
Branch divestiture (DOJ antitrust settlement) 8.25.04
Slide presentation 8.23.04
Announce "community plan" 8.05.04
Slide presentation 7.26.04

National Commerce / SunTrust Banks Cash Election Merger

$ 7.0 billion, cash election merger

Expands SunTrust's footprint in high growth Southeast
NCF received a competing offer from Fifth Third Bancorp

Deal terms

74% stock / 26% cash
Can elect cash, subject to proration

Buyer (GA) / Target (TN)
Direct statutory merger with cash election
$280 million break-up fee (4%)
Reduced to 2.9% to settle shareholder litigation

Advisors

SunTrust: Goldman / Skadden Arps / King & Spalding

NCF: JP Morgan / UBS / Wachtell / Bass Berry

Announced 5.09.04

Completed 10.01.04

Agreements

Merger agreement

Notable provisions

Cash election provision - § 1.4
Target "no-shop" covenant - § 6.14
Break-up fee of $280 million (4.0%) - § 8.3
Reduced to 2.9% to settle shareholder litigation

Trust preferred assumption

Form 8-A 10.01.04

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