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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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) July 19, 1996
FIRST FAMILY FINANCIAL CORPORATION
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(Exact Name of Registrant as Specified in Charter)
Florida 59-3277352
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(State of other jurisdiction) (IRS Employer Identification No.)
33-81818
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(Commission File Number)
2801 South Bay Street, Eustis, Florida 32726-6503
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(Address of Principal Executive Offices) (Zip Code)
(352) 357-4171
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(Registrant's Telephone Number, Including Area Code)
N/A
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(Former Name or Former Address, if Changed Since Last Report)
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Item 5. Other Events
A. Agreement and Plan of Merger. On July 19, 1996, First Family
Financial Corporation, a one-bank holding company located in Eustis, Florida
("First Family"), entered into an Agreement and Plan of Merger ("Merger
Agreement") with Colonial BancGroup, Inc. ("Colonial BancGroup") Montgomery,
Alabama, a bank holding company, with assets of $4.5 billion in total assets and
127 full service offices in Alabama, Florida, Georgia and Tennessee.
The acquisition will involve First Family being merged with and
into Colonial BancGroup, continuing with Colonial BancGroup as the surviving
corporation ("Merger"). Under the terms of the Merger Agreement, Colonial
BancGroup is proposing to acquire all of the outstanding capital stock of First
Family (545,000 shares of common stock and 35,500 shares of Common Stock for
which options have been granted) in a reorganization within the meaning of
Section 368(a) of the Internal Revenue Code. Each share of First Family's common
stock, par value $.01 ("First Family Stock"), issued and outstanding immediately
prior to the effective time shall, by virtue of the Merger Agreement and without
any action on the part of the holder thereof, be converted into and represent
the right to receive shares of Colonial BancGroup's Common Stock, par value
$2.50 per share ("BancGroup Common Stock") and cash with a total value equal to
$23.50 per share of First Family Stock ("Merger Consideration"), as follows.
Each holder of First Family Stock shall, for each such share, receive Merger
Consideration of $11.75 in cash and BancGroup Common Stock with a value of
$11.75, as determined in the Merger Agreement. The number of shares of BancGroup
Common Stock into which each outstanding share of First Family Stock will be
converted will be equal to $11.75 divided by the "Market Value" (as defined in
the Merger Agreement). Pursuant to the Merger Agreement, Market Value is the
market value of the BancGroup Common Stock on the effective date of the Merger
as determined by the closing prices reported by the New York Stock Exchange on
each of the ten (10) trading days, ending on the trading day immediately
proceeding the effective date of the Merger. Colonial BancGroup will assume all
First Family stock options outstanding and each option will represent the right
to obtain BancGroup Common Stock on substantially the same terms applicable to
the First Family options. The details of the Merger are more fully described in
the Merger Agreement attached hereto as Exhibit 1.
The transaction will be accounted for as a "purchase" and is
subject to the approval of First Family's shareholders and regulatory approvals
from the Federal Reserve Board and Florida Department of Banking and Finance. In
addition, First Family has received an oral opinion from Mercer Capital that the
consideration to be received by First Family's shareholders is "fair" to the
shareholders from a financial point of view. Prior to the distribution of the
Proxy Statement to the shareholders of First Family, Mercer Capital is to
prepare a written fairness opinion to confirm that the consideration to be
received by First Family's shareholders is fair as of that date.
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At June 30, 1996, First Family had total consolidated assets of
$155,890,000 total consolidated deposits of $143,362,000 and total consolidated
stockholders' equity of $9,222,000. The common stock of First Family is listed
on the NASDAQ-NMS under the symbol "FFML". On June 30, 1996, First Family's
common stock was traded at $21 per share.
B. Press Release. On July 25, 1996, First Family issued a joint
Press Release with Colonial BancGroup announcing the signing of a definitive
agreement whereby First Family will be acquired by Colonial BancGroup, a $4.5
billion bank holding company headquartered in Montgomery, Alabama. The specific
terms of the merger and consideration for the transaction are contained in the
Merger Agreement.
C. Correction to Letter to Shareholders. On July 25, 1996, a
letter to the shareholders was issued by First Family. This letter made the
statement that Colonial BancGroup, the parent company of Colonial Mortgage, was
"one of the ten largest mortgage banking companies in the United States". This
was incorrect. The letter should have indicated that at the time that Colonial
acquires First Family that Colonial Mortgage will be one of the ten largest
private mortgage companies in the United States.
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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 hereunto duly authorized.
First Family Financial Corporation
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(Registrant)
Dated this 25th day of July, 1996 By: /s/David M. Shepherd
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David M. Shepherd
President