UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): May 24, 2006
REGIONS FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 0-6159 63-0589368
(State or other (Commission File Number) (IRS Employer
jurisdiction of Identification No.)
incorporation)
417 North 20th Street 35203
Birmingham, Alabama
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (205) 944-1300
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
|X| Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
On May 24, 2006, Regions Financial Corporation ("REGIONS") and AmSouth
Bancorporation ("AMSOUTH") entered into an Agreement and Plan of Merger (the
"MERGER AGREEMENT"), pursuant to which AmSouth will, subject to the terms and
conditions of the Merger Agreement, merge with and into Regions (the "MERGER"),
with the combined company retaining the name Regions Financial Corporation.
Subject to the terms and conditions of the Merger Agreement, which has been
unanimously approved by the boards of directors of both companies, upon the
completion of the Merger each share of AmSouth common stock will be converted
into 0.7974 shares of Regions common stock (the "EXCHANGE RATIO"), with cash to
be paid in lieu of fractional shares of Regions common stock. AmSouth stock
options and other equity awards will convert upon completion of the Merger into
stock options and equity awards with respect to Regions common stock, subject to
adjustment to reflect the Exchange Ratio.
The Merger Agreement contains representations, warranties and covenants of
AmSouth and Regions, including, among others, covenants (i) to conduct their
respective businesses in the ordinary course during the period between the
execution of the Merger Agreement and consummation of the Merger and (ii) not to
engage in certain kinds of transactions during such period. The board of
directors of each company has adopted a resolution recommending the approval and
adoption of the Merger Agreement by its respective stockholders, and each party
has agreed to hold a stockholder meeting to put these matters before their
stockholders for their consideration. Each party has also agreed not to (i)
solicit proposals relating to alternative business combination transactions or
(ii) subject to certain exceptions, enter into discussions or negotiations or
provide confidential information in connection with any proposals for
alternative business combination transactions.
Consummation of the Merger is subject to various conditions, including (i)
requisite approvals of the holders of AmSouth and Regions common stock, (ii)
receipt of regulatory approvals, (iii) the absence of any law or order
prohibiting the closing, and (iv) effectiveness of the Form S-4 registration
statement relating to the Regions common stock to be issued in the Merger and
listing of the Regions common stock to be issued in the Merger on the New York
Stock Exchange. In addition, each party's obligation to consummate the Merger is
subject to certain other conditions, including (i) subject to the standards set
forth in the Merger Agreement, the accuracy of the representations and
warranties of the other party, (ii) compliance of the other party with its
covenants in all material respects and (iii) the delivery of opinions from
counsel to AmSouth and counsel to Regions relating to the U.S. federal income
tax code treatment of the Merger.
Under the Merger Agreement, upon completion of the Merger, Jackson W. Moore,
chairman of the board, president and chief executive officer of Regions, will
become chairman of the board of the combined company, and C. Dowd Ritter,
chairman of the board, president and chief executive officer of AmSouth, will
become president and chief executive officer of the combined company. The
combined company's board of directors will initially be comprised of twenty-one
members, with twelve nominated by Regions and nine nominated by AmSouth (subject
to possible increase by one newly appointed director for each company as
mutually agreed by the parties). Effective as of the completion of the Merger,
the Regions by-laws will be amended to implement provisions relating to the
management and the board of directors of Regions after the Merger, as further
described in the Merger Agreement.
The Merger Agreement contains certain termination rights for both Regions and
AmSouth. Under certain circumstances, termination of the Merger Agreement may
result in a party having rights under its relevant Stock Option Agreement
(described below).
In connection with entering into the Merger Agreement, Regions and AmSouth
entered into separate reciprocal stock option agreements (the "STOCK OPTION
AGREEMENTS"), pursuant to which each of AmSouth and Regions granted to
the other a stock option (the "OPTION") with respect to a number of shares
representing up to 19.9% of each party's total outstanding common shares prior
to the issuance of shares under the applicable Stock Option Agreement. Neither
of the Options is currently exercisable and, as further set forth in the Stock
Option Agreements, will only become exercisable upon the occurrence of certain
events relating to a third party acquisition proposal relating to the issuer of
the shares covered by the respective Option. Each party's total realizable value
under the Option it has been granted is subject to a cap of approximately $393
million. Under certain circumstances, each of the parties may be required to
repurchase for cash the applicable Option or the shares acquired pursuant to the
exercise of such Option.
In connection with the execution of the merger agreement, Jackson W. Moore,
Regions' chief executive officer, entered into an employment agreement with a
four-year term commencing upon completion of the Merger, which will supersede
his existing agreement. During the term, Mr. Moore will serve as Regions'
Chairman and as a member of its board of directors. Mr. Moore will be provided
with office space and secretarial services at both Regions' headquarters and a
location to be determined by Mr. Moore. During the term, Mr. Moore will receive
annual base salary, annual bonus and long-term incentive compensation of not
less than 75 percent of those provided to Regions' chief executive officer, with
newly granted long-term incentive awards to vest no later than the expiration of
the four-year term. Mr. Moore will participate in all benefit, perquisite
(including reimbursement for club dues and relocation expenses) and other plans
(other than certain retirement plans of AmSouth) generally applicable to
Regions' chief executive officer and other senior executives, including retiree
medical benefits for Mr. Moore and his spouse and use of a corporate aircraft.
Following completion of the Merger, Mr. Moore will be paid his SERP benefit, his
deferred stock account balance and the change-in-control benefits under his
existing employment agreement, and on completion of the Merger, all equity-based
compensation awards will vest and options will remain exercisable in accordance
with their current terms. In addition, Regions will honor the existing terms of
the trust agreement pertaining to the payment of premiums on Mr. Moore's life
insurance policy. In the event that, during the term, Mr. Moore's employment is
terminated by Regions without "cause" or by Mr. Moore for "good reason," Mr.
Moore will be paid a lump sum cash payment equal to the sum of (1) a pro rata
bonus for the year of termination and (2) Mr. Moore's annual base salary and
average annual bonus as Chairman (or if no such bonus has been paid, his last
bonus as chief executive officer) for the remainder of the term. In addition,
upon such a termination all equity compensation awards will vest and remain
exercisable for their full term.
The foregoing descriptions of the Merger Agreement, Stock Option Agreements and
Employment Agreement are not complete and are qualified in their entirety by
reference to the Merger Agreement, Stock Option Agreements and Employment
Agreement, copies of which are filed as Exhibits 2.1, 99.1, 99.2 and 10.1,
respectively, hereto and are hereby incorporated into this report by reference.
The Merger Agreement, which has been included to provide investors with
information regarding its terms, contains representations and warranties of each
of Regions and AmSouth. The assertions embodied in those representations and
warranties were made for purposes of the Merger Agreement and are subject to
qualifications and limitations agreed by the respective parties in connection
with negotiating the terms of the Merger Agreement. In addition, certain
representations and warranties were made as of a specific date, may be subject
to a contractual standard of materiality different from what a stockholder might
view as material, or may have been used for purposes of allocating risk between
the respective parties rather than establishing matters as facts. Investors
should read the Merger Agreement and the Stock Option Agreements together with
the other information concerning Regions and AmSouth that each company publicly
files in reports and statements with the Securities and Exchange Commission (the
"SEC").
ADDITIONAL INFORMATION ABOUT THIS TRANSACTION
The Merger will be submitted to Regions Financial's and AmSouth's stockholders
for their consideration. Regions Financial will file a registration statement,
which will include a joint proxy statement/prospectus to be sent to each
company's stockholders, and each of Regions Financial and AmSouth may file other
relevant documents concerning the Merger with the SEC. Stockholders are urged to
read the registration statement and the joint proxy statement/prospectus
regarding the Merger when they become available and any other relevant documents
filed with the SEC, as well as any amendments or supplements to those documents,
because they will contain important information. You will be able to obtain a
free copy of the joint proxy statement/prospectus, as well as other filings
containing information about Regions Financial and AmSouth, at the SEC's website
(http://www.sec.gov). You will also be able to obtain these documents, free of
charge, by accessing Regions Financial's website (http://www.regions.com) under
the tab "Investor Relations" and then under the heading "SEC Filings", or by
accessing AmSouth's website (http://www.amsouth.com) under the tab "About
AmSouth", then under the tab "Investor Relations" and then under the heading
"SEC Filings".
Regions Financial and AmSouth and their respective directors and executive
officers may be deemed to be participants in the solicitation of proxies from
the stockholders of Regions Financial and/or AmSouth in connection with the
Merger. Information about the directors and executive officers of Regions
Financial is set forth in the proxy statement for Regions Financial's 2006
annual meeting of stockholders, as filed with the SEC on April 5, 2006.
Information about the directors and executive officers of AmSouth is set forth
in the proxy statement for AmSouth's 2006 annual meeting of stockholders, as
filed with the SEC on March 16, 2006. Additional information regarding the
interests of those participants and other persons who may be deemed participants
in the transaction may be obtained by reading the joint proxy
statement/prospectus regarding the Merger when it becomes available. You may
obtain free copies of these documents as described above.
FORWARD-LOOKING STATEMENTS
This filing contains forward-looking statements made pursuant to the safe-harbor
provisions of the Private Securities Litigation Act of 1995. These include
statements as to the benefits of the Merger, including future financial and
operating results, cost savings, enhanced revenues and the accretion/dilution to
reported earnings that may be realized from the Merger as well as other
statements of expectations regarding the Merger and any other statements
regarding future results or expectations. These statements involve risks and
uncertainties that may cause results to differ materially from those set forth
in these statements. Regions Financial and AmSouth caution readers that results
and events subject to forward-looking statements could differ materially due to
the following factors, among others: the risk that the businesses of Regions
Financial and/or AmSouth in connection with the Merger will not be integrated
successfully or such integration may be more difficult, time-consuming or costly
than expected; expected revenue synergies and cost savings from the Merger may
not be fully realized or realized within the expected time frame; revenues
following the Merger may be lower than expected; customer and employee
relationships and business operations may be disrupted by the Merger; the
ability to obtain required governmental and stockholder approvals, and the
ability to complete the Merger on the expected timeframe; possible changes in
economic and business conditions; the existence or exacerbation of general
geopolitical instability and uncertainty; the ability of Regions Financial and
AmSouth to integrate recent acquisitions and attract new customers; possible
changes in monetary and fiscal policies, and laws and regulations; the effects
of easing of restrictions on participants in the financial services industry;
the cost and other effects of legal and administrative cases; possible changes
in the credit worthiness of customers and the possible impairment of
collectibility of loans; the effects of changes in interest rates and other
risks and factors identified in each company's filings with the SEC. Regions
Financial and AmSouth do not undertake any obligation to update any
forward-looking statement, whether written or oral, relating to the matters
discussed in this filing.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
(d) Exhibits
The following exhibits are filed herewith:
EXHIBIT NO. DESCRIPTION OF EXHIBIT
2.1 Agreement and Plan of Merger, dated as of May 24, 2006, by and
between Regions Financial Corporation and AmSouth
Bancorporation.
10.1 Employment Agreement, dated as of May 24, 2006, by and between
Regions Financial Corporation and Jackson W. Moore.
99.1 Stock Option Agreement, dated as of May 24, 2006, by and
between Regions Financial Corporation (issuer) and AmSouth
Bancorporation (grantee).
99.2 Stock Option Agreement, dated as of May 24, 2006, by and
between Regions Financial Corporation (grantee) and AmSouth
Bancorporation (issuer).
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized, on this 31st day of May, 2006.
REGIONS FINANCIAL CORPORATION
By: /s/ D. Bryan Jordan
-------------------------
Name: D. Bryan Jordan
Title: Executive Vice President and Chief
Financial Officer
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION OF EXHIBIT
2.1 Agreement and Plan of Merger, dated as of May 24, 2006, by and
between Regions Financial Corporation and AmSouth
Bancorporation.
10.1 Employment Agreement, dated as of May 24, 2006, by and between
Regions Financial Corporation and Jackson W. Moore.
99.1 Stock Option Agreement, dated as of May 24, 2006, by and
between Regions Financial Corporation (issuer) and AmSouth
Bancorporation (grantee).
99.2 Stock Option Agreement, dated as of May 24, 2006, by and
between Regions Financial Corporation (grantee) and AmSouth
Bancorporation (issuer).