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):
September 21, 1994
NATIONSBANK CORPORATION
_________________________________________________________
(Exact name of registrant as specified in its charter)
North Carolina 1-6523 56-0906609
________________________ _____________ _________________
(State of Incorporation) (Commission (IRS Employer
File Number) Identification No.)
NationsBank Corporate Center, Charlotte, North Carolina 28255
______________________________________________________________
(Address of principal executive offices) (Zip Code)
(704) 386-5000
________________________________________________________________
(Registrant's telephone number, including area code)
ITEM 5. OTHER EVENTS
The following is an updated Description of Common Stock of
NationsBank Corporation, which has been previously filed with the
Securities and Exchange Commission (the "SEC") under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"),
and updated and amended from time to time. The following
description reflects an increase in the authorized capital stock
of the Registrant and the redemption of two series of the
Registrant's Preferred Stock. To the extent this description is
inconsistent with prior filings, it modifies and supersedes such
filings.
DESCRIPTION OF COMMON STOCK
AUTHORIZED CAPITAL
The Registrant is authorized to issue 800,000,000 shares of
common stock (the "Common Stock"). As of June 30, 1994,
276,516,942 shares of such Common Stock were issued and
outstanding. A total of 13,666,406 additional shares were
reserved as of such date for potential issuance in connection
with various employee benefit plans of the Registrant and the
conversion of the Registrant's ESOP Convertible Preferred Stock,
Series C (the "ESOP Preferred Stock"), a total of 5,363,694
additional shares were reserved for issuance under the
Registrant's Dividend Reinvestment and Stock Purchase Plan, and a
total of 1,050,000 additional shares were reserved for issuance
in connection with the pending acquisition of RHNB Corporation.
After taking into account the shares reserved as described above,
the number of authorized shares of Common Stock available for
other corporate purposes as of June 30, 1994 was 503,402,958.
The Registrant is also authorized to issue an aggregate of
45,000,000 shares of preferred stock, having no par value. The
Board of Directors may issue such preferred stock in one or more
series, each with such preferences, limitations, designations,
conversion rights, voting rights, dividend rights, voluntary and
involuntary liquidation rights and other rights as it may
determine. The Board of Directors of the Registrant has
designated 3,000,000 shares of ESOP Preferred Stock, of which
2,644,526 shares were issued and outstanding as of June 30, 1994.
The rights of holders of Common Stock are subject to any
rights and preferences of the ESOP Preferred Stock, as
hereinafter described, and would be subject to the rights and
preferences of any additional shares of preferred stock, or any
series hereof, which might be issued in the future. The
Adjustable Rate Cumulative Preferred Stock, Series CC, and the
Adjustable Rate Cumulative Preferred Stock, Series DD, which were
previously issued by the Registrant, have been redeemed and
canceled.
Under North Carolina law, any outstanding shares of capital
stock of the Registrant reacquired by the Registrant would be
considered authorized but unissued shares.
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VOTING AND OTHER RIGHTS
The holders of Common Stock are entitled to one vote per
share on each matter voted on at a shareholder's meeting. A
majority of the shares of a voting group entitled to vote,
represented at a meeting in person or by proxy, constitutes a
quorum of that voting group, and, in general, a majority of votes
cast with respect to a matter by a voting group is sufficient to
take action upon routine matters. Directors shall be elected by
a plurality of the votes cast by the shares entitled to vote in
the election at a meeting at which a quorum is present, and each
shareholder entitled to vote in such an election shall be
entitled to vote each share of Common Stock owned by such
shareholder for as many persons as there are directors to be
elected. The holders of Common Stock do not have the right to
cumulate their votes in the election for directors, so long as
the Registrant has a class of shares registered under Section 12
f the Exchange Act (unless action is taken to provide otherwise
by amendment to the Registrant's Restated Articles of
Incorporation, which action management currently does not intend
to propose).
In general, (i) substantive amendments to the Registrant's
Restated Articles of Incorporation must be approved by each
voting group entitled to vote separately thereon by a majority of
the votes cast by that voting group, unless the amendment creates
dissenters' rights for a particular voting group, in which case
such amendment must be approved by a majority of the votes
entitled to be cast by such voting group; (ii) a merger or share
exchange required to be approved by shareholders must be approved
by each voting group entitled to vote separately thereon by a
majority of the votes entitled to be cast by that voting group;
and (iii) the dissolution of the Registrant, or the sale of all
or substantially all of the property of the Registrant other than
in the usual and regular course of business, must be approved by
a majority of all votes entitled to be cast thereon.
The Board of Directors or the shareholders of the Registrant
may act to amend or repeal any of the Registrant's Bylaws.
Pursuant to the North Carolina Business Corporation Act (the
"Business Corporation Act"), any Bylaw adopted, amended or
repealed by the shareholders generally may not be readopted,
amended or repealed by the Board of Directors of the Registrant
unless otherwise authorized by the shareholders in the
Registrant's Restated Articles of Incorporation or in a bylaw
adopted by the shareholders. The Registrant's Amended and
Restated Bylaws were adopted by its Board of Directors, however,
and thus may be amended, in whole or in part, by the Board of
Directors.
The shareholders of the Registrant shall have dissenters'
rights to appraisal with respect to their shares of Common Stock
as provided by statute in connection with certain types of merger
or share exchange transactions. Dissenters' rights are also
available with respect to certain sales of all or substantially
all of the property of the Registrant and certain amendments to
the Registrant's Restated Articles of Incorporation that
materially and adversely affect certain enumerated rights of a
dissenter's shares.
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DIRECTORS
The Registrant's directors are elected for one-year terms.
Under the Registrant's Bylaws, the number of directors shall be
not fewer than five nor more than thirty, as determined from time
to time by the Board of Directors. The directors of the
Registrant have fixed the current number of directors at 26.
North Carolina law provides the shareholders of the Registrant
with certain statutory rights to fix the number of directors of
the Registrant and to establish a different range of directors.
Under state law, only the shareholders of the Registrant have the
right to change the range of number of directors currently set
forth in the Bylaws, by amendment to the Registrant's Restated
Articles of Incorporation or Bylaws.
Vacancies, whether arising from an increase in the number of
directors or from the failure by shareholders to elect the full
authorized number of directors, may be filled by the shareholders
or by the Board of Directors (by the affirmative vote of a
majority of the remaining directors if less than a quorum of
directors remains). Generally, directors may be removed by the
shareholders with or without cause by the affirmative vote of a
majority of the votes cast, unless the Registrant's Restated
Articles of Incorporation are amended to provide otherwise.
LIQUIDATION, PREEMPTIVE AND OTHER RIGHTS
In the event of liquidation, the holders of Common Stock
would be entitled to receive pro rata any assets legally
available for distribution to shareholders with respect to shares
held by them, subject to any prior rights of any preferred stock
then outstanding. The Common Stock does not have any preemptive
rights, redemption privileges, sinking fund privileges or
conversion rights. All the outstanding shares of Common Stock
are validly issued, fully paid and nonassessable. The Common
Stock is listed on the New York Stock Exchange, Inc. and The
Pacific Stock Exchange Incorporated. Certain of the shares of
Common Stock are also listed and traded on the Tokyo Stock
Exchange. Chemical Bank acts as transfer agent and registrar for
the Common Stock. As of June 30, 1994, there were 106,705
shareholders of record of the Registrant.
DISTRIBUTIONS
GENERAL REQUIREMENTS. The holders of shares of Common Stock
will be entitled to receive such distributions as the Board of
Directors of the Registrant may declare, subject to any
restrictions contained in the Registrant's Restated Articles of
Incorporation (of which there currently are none), unless after
giving effect to such distribution, (i) the Registrant would not
be able to pay its debts as they become due in the usual course
of business or (ii) the Registrant's total assets would be less
than the sum of its total liabilities plus the amount that would
be needed, if the Registrant were to be dissolved at the time of
the distribution, to satisfy claims of shareholders that have
preferential rights superior to the rights of holders of Common
Stock. The Registrant also may issue share dividends in Common
Stock to the holders of shares of Common Stock. In addition, if
certain requirements are met, share dividends in shares of
another class or series may be issued to holders of Common Stock.
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RESTRICTIONS ON SUBSIDIARY DIVIDENDS. Although the
Registrant is not subject to the restrictions on dividends
applicable to national banks, the ability of the Registrant to
make distributions to holders of Common Stock is dependent to a
large extent upon the ability of its subsidiary banks to pay
dividends. Each bank subsidiary of the Registrant is subject to
restrictions on dividends applicable to national banks. Under
current regulations, the amount of dividends that may be paid by
a national bank without approval of the Office of the Comptroller
of the Currency (the "Comptroller") is the sum of the bank's net
profits (as defined by statute) for that year in which it is
making the dividend payment plus its retained net profits (as
defined by statute) for the preceding two years.
In addition, no dividend may be declared or paid on the
common stock of a national bank until cumulative dividends on
outstanding preferred stock have been paid in full, and no
dividends may be paid if the bank is in default on the payment of
any assessment due the Federal Deposit Insurance Corporation (the
"FDIC"). The Comptroller also has authority under the Financial
Institutions Supervisory Act to prohibit a national bank from
engaging in what, in his opinion, constitutes an unsafe or
unsound practice in conducting its business. Under certain
circumstances relating to the financial condition of a national
bank, as where the payment of dividends would deplete a bank's
capital base to an inadequate level, the Comptroller may
determine that the payment of dividends would be an unsafe or
unsound banking practice.
CAPITAL GUIDELINES. The ability of the subsidiary banks, as
well as the Registrant, to pay dividends in the future is
influenced by the various minimum capital requirements and the
capital and non-capital standards established under the Federal
Deposit Insurance Corporation Improvement Act of 1991.
The Board of Governors of the Federal Reserve System (the
"Federal Reserve Board"), the Comptroller and the FDIC have
issued substantially similar risk-based and leverage capital
guidelines applicable to United States banking organizations. In
addition, those regulatory agencies may from time to time require
that a banking organization maintain capital above the minimum
levels, whether because of its financial condition or actual or
anticipated growth.
The Federal Reserve Board risk-based guidelines define a
two-tier capital framework. Tier 1 capital consists of common
and qualifying preferred shareholders' equity, less certain
intangibles and other adjustments. Tier 2 capital consists of
subordinated and other qualifying debt, and the allowance for
credit losses up to 1.25 percent of risk-weighted assets. The
sum of Tier 1 and Tier 2 capital less investments in
unconsolidated subsidiaries represents qualifying total capital,
at least 50 percent of which must consist of Tier 1 capital.
Risk-based capital ratios are calculated by dividing Tier 1 and
total capital by risk-weighted assets. Assets and off-balance
sheet exposures are assigned to one of four categories of risk
weights, based primarily on relative credit risk. The minimum
Tier 1 capital ratio is 4 percent and the minimum total capital
ratio is 8 percent.
The leverage ratio is determined by dividing Tier 1 capital
by total adjusted assets. Although the stated minimum ratio is 3
percent, most banking organizations are required to maintain
ratios of at least 100 to 200 basis points above 3 percent.
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COVENANTS RESTRICTING DIVIDENDS. Various indentures under
which Registrant has issued debt securities, or under which the
Registrant has assumed the obligations of such issuer, contain
certain provisions prohibiting the Registrant from paying
dividends on its capital stock, or purchasing, redeeming, or
otherwise acquiring or making distributions with respect to its
capital stock if, after giving effect thereto, certain financial
conditions are not met. The Registrant believes that these
provisions will not materially affect the Registrant's ability to
pay dividends on its capital stock.
INDEMNIFICATION OF OFFICERS AND DIRECTORS
As permitted by the Business Corporation Act, the
Registrant's Amended and Restated Bylaws provide that, in
addition to the indemnification of directors and officers
otherwise provided by the Business Corporation Act, the
Registrant shall, under certain circumstances, indemnify its
directors, executive officers and certain other designated
officers against any and all liability and litigation expense,
including reasonable attorneys' fees, arising out of their status
or activities as directors or officers, except for liability or
litigation expense incurred on account of activities that were at
the time known or reasonably should have been known by such
director or officer to be clearly in conflict with the best
interests of the Registrant. Pursuant to such bylaw and as
authorized by statute, the Registrant maintains insurance on
behalf of its directors and officers against liability asserted
against such persons in such capacity whether or not such
directors or officers have the right to indemnification pursuant
to the bylaw or otherwise.
In addition to the above-described provisions, Sections 55-
8-50 through 55-8-58 of the Business Corporation Act contain
provisions prescribing the extent to which directors and officers
shall be indemnified. Section 55-8-51 of the Business
Corporation Act permits a corporation, with certain exceptions,
to indemnify a current or former director against liability if
(i) he conducted himself in good faith, (ii) he reasonably
believed (x) that his conduct in his official capacity with the
corporation was in its best interests and (y) in all other cases
his conduct was at least not opposed to the corporation's best
interests, and (iii) in the case of any criminal proceeding, he
had no reasonable cause to believe his conduct was unlawful. A
corporation may not indemnify a current or former director in
connection with a proceeding by or in the right of the
corporation in which the director was adjudged liable to the
corporation or in connection with a proceeding charging improper
personal benefit to him in which he was adjudged liable on such
basis. The above standard of conduct is determined by the Board
of Directors or a committee thereof or special legal counsel or
the shareholders as prescribed in Section 55-8-55.
Sections 55-8-52 and 55-8-56 of the Business Corporation Act
require a corporation to indemnify a director or officer in the
defense of any proceeding to which he was a party because of his
capacity as a director or officer against reasonable expenses
when he is wholly successful in his defense, unless the articles
of incorporation provide otherwise. Upon application, the court
may order indemnification of the director or officer if he is
adjudged fairly and reasonably so entitled under Section 55-8-54.
Section 55-8-56 allows a corporation to indemnify and advance
expenses to an officer, employee or agent who is not a director
to the same extent as
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a director or as otherwise set forth in the corporation's articles of
incorporation or bylaws or by resolution of the Board of Directors.
LIMITATION OF DIRECTOR LIABILITY
The Restated Articles of Incorporation of the Registrant
provide that, to the fullest extent permitted by the Business
Corporation Act, a director of the Registrant shall not be
personally liable to the Registrant, its shareholders or
otherwise for monetary damages for breach of his duty as a
director. This provision precludes any claim by the shareholders
of the Registrant for monetary damages based on a breach of duty
of directors, with the following exceptions under the Business
Corporation Act: (i) acts or omissions that such director at the
time of such breach knew or believed were clearly in conflict
with the best interests of the corporation, (ii) certain unlawful
distributions, including unlawful redemptions of shares, (iii)
any transaction from which such director derived an improper
personal benefit or (iv) acts or omissions occurring prior to the
effectiveness of the provision on April 27, 1988.
ESOP PREFERRED STOCK
The rights of holders of Common Stock are subject to the
rights of holders of the ESOP Preferred Stock. The ESOP
Preferred Stock was first issued in the transaction by which the
Registrant was formed from the merger of NCNB Corporation and
C&S/Sovran Corporation in 1991, upon the conversion of shares of
ESOP Convertible Preferred Stock, Series C of C&S/Sovran
Corporation. All shares of ESOP Preferred Stock are held by the
trustee under the NationsBank Corporation Retirement Savings Plan
(the "ESOP"). The ESOP Preferred Stock ranks senior to the
Common Stock.
Shares of the ESOP Preferred Stock have no preemptive or
preferential rights to purchase or subscribe for shares of the
Registrant's capital stock of any class and are not subject to
any sinking fund or other obligation of the Registrant to
repurchase or retire the series, except as discussed below.
Each share of the ESOP Preferred Stock is entitled to an
annual dividend, subject to certain adjustments, of $3.30 per
share, payable semiannually. Unpaid dividends accumulate as of
the date on which they first became payable, without interest.
So long as any shares of ESOP Preferred Stock are outstanding, no
dividend may be declared and paid or set apart for payment on any
other series of stock ranking on a parity with the ESOP Preferred
Stock as to dividends, unless like dividends have been declared
and paid or set apart for payment on the ESOP Preferred Stock for
all dividend payment periods ending on or before the dividend
payment date for such parity stock, ratably in proportion to
their respective amounts of accumulated and unpaid dividends.
The Registrant generally may not declare, pay or set apart for
payment any dividends (except for, among other things, dividends
payable solely in shares of stock ranking junior to the ESOP
Preferred Stock as to dividends or upon liquidation) on, make any
other distribution on, or make payment on account of the
purchase, redemption or other retirement of, any other class or
series of the Registrant's capital stock ranking junior to
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the ESOP Preferred Stock as to dividends or upon liquidation, until
full cumulative dividends on the ESOP Preferred Stock have been
declared and paid or set apart for payment when due.
The holder of the ESOP Preferred Stock is entitled to vote
on all matters submitted to a vote of the holders of Common Stock
and votes together with the holders of Common Stock as one class.
Except as otherwise required by applicable law, the holder of the
ESOP Preferred Stock has no special voting rights. To the extent
that the holder of such shares is entitled to vote, each share is
entitled to the number of votes equal to the number of shares of
Common Stock into which such share of ESOP Preferred Stock could
be converted on the record date for determining the shareholders
entitled to vote, rounded to the nearest whole vote.
Shares of ESOP Preferred Stock initially are convertible
into Common Stock at a conversion rate equal to 0.84 shares of
Common Stock per share of ESOP Preferred Stock and a conversion
price of $42.50 per 0.84 shares of Common Stock, subject to
certain customary anti-dilution adjustments.
In the event of any voluntary or involuntary dissolution,
liquidation or winding-up of the Registrant, the holder of the
ESOP Preferred Stock will be entitled to receive out of the
assets of the Registrant available for distribution to
shareholders, subject to the rights of the holders of any
preferred stock ranking senior to or on a parity with the ESOP
Preferred Stock as to distributions upon liquidation, dissolution
or winding up, but before any amount will be paid or distributed
among the holders of Common Stock or any other shares ranking
junior to the ESOP Preferred Stock as to such distributions,
liquidating distributions of $42.50 per share plus all accrued
and unpaid dividends thereon to the date fixed for distribution.
If, upon any voluntary or involuntary dissolution, liquidation or
winding-up of the Registrant, the amounts payable with respect to
the ESOP Preferred Stock and any other stock ranking on a parity
therewith as to any such distribution are not paid in full, the
holder of the ESOP Preferred Stock and such other stock will
share ratably in any distribution of assets in proportion to the
full respective preferential amounts to which they are entitled.
After payment of the full amount of the liquidating distribution
to which it is entitled, the holder of the ESOP Preferred Stock
will not be entitled to any further distribution of assets by the
Registrant. Neither a merger or consolidation of the Registrant
with or into any other corporation, nor a merger or consolidation
of any other corporation with or into the Registrant, nor a sale,
transfer or lease of all or any portion of the Registrant's
assets, will be deemed to be a dissolution, liquidation or
winding-up of the Registrant.
The ESOP Preferred Stock became redeemable, in whole or in
part, at the option of the Registrant, at any time after July 1,
1992. If the Registrant redeems the ESOP Preferred Stock, the
redemption price for the shares of the ESOP Preferred Stock will
depend upon the time of redemption. Specifically, the redemption
price for the 12-month period beginning July 1, 1994, is $44.15
per share; on each succeeding July 1, the redemption price will
be reduced by $.33 per share, except that on and after July 1,
1999, the redemption price will be $42.50 per share, and the
redemption price may be paid in cash or shares of Common Stock.
In each case, the redemption price also must include all accrued
and unpaid dividends to the date of redemption. To the extent
that the ESOP Preferred Stock is treated as Tier 1 capital for
bank regulatory
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purposes, the approval of the Federal Reserve Board may be required
for redemption of the ESOP Preferred Stock.
The Registrant is required to redeem shares of the
ESOP Preferred Stock at the option of the holder of such shares
to the extent necessary either to provide for distributions
required to be made under the ESOP or to make payments of
principal, interest or premium due and payable on any
indebtedness incurred by the holder of the shares for the benefit
of the ESOP. The redemption price in such case will be the
greater of $42.50 per share plus accrued and unpaid dividends to
the date of redemption or the fair market value of the aggregate
number of shares of Common Stock into which a share of ESOP
Preferred Stock then is convertible.
EFFECTIVE LAW
The rights of holders of the Common Stock of the Registrant
are dependent, directly or indirectly, on applicable state and
federal statutes and regulations which are subject to change from
time to time. The Registrant has not undertaken to update the
foregoing description in each case where such a change may affect
the rights of shareholders.
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SIGNATURES
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.
NATIONSBANK CORPORATION
By: /S/ CHARLES M. BERGER
Deputy General Counsel
Dated: September 21, 1994
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