1
===============================================================================
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): DECEMBER 12, 1995
BANK OF BOSTON CORPORATION
(Exact name of registrant as specified in its charter)
MASSACHUSETTS 1-6522 04-2471221
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
100 FEDERAL STREET, BOSTON, MASSACHUSETTS 02110
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (617) 434-2200
===============================================================================
2
-2-
ITEM 5. OTHER EVENTS
On December 12, 1995, Bank of Boston Corporation ("Bank of Boston") and
BayBanks, Inc. ("BayBanks") entered into an Agreement and Plan of Merger (the
"Merger Agreement") pursuant to which a wholly owned subsidiary of the
Corporation will be merged with and into BayBanks (the "Merger") and BayBanks
will become a subsidiary of the Corporation. BayBanks, a Boston-based bank
holding company, had total assets of $11.5 billion as of September 30, 1995.
The combined company's principle bank will be called BayBank of Boston, N.A.
The combined organization will conduct consumer banking business under the
"BayBank" name and corporate and international business under the "Bank of
Boston" name. William M. Crozier, Jr., Chairman and President of BayBanks, will
become Chairman of the Board of Directors of Bank of Boston. Three other
directors of BayBanks also will join Bank of Boston's Board. Charles K.
Gifford, Chairman and Chief Executive Officer of Bank of Boston, will be
President and Chief Executive Officer of Bank of Boston and will add the title
of Chairman when Mr. Crozier retires in 1998. A copy of the Merger
Agreement is attached hereto as Exhibit 2(a) and incorporated herein by
reference. The press release describing the proposed acquisition is attached
hereto as Exhibit 99(a).
In accordance with the terms of the Merger Agreement, at closing each
outstanding share of BayBanks common stock, par value $2.00 per share (the
"BayBanks Common Stock"), except for shares (i) held directly or indirectly by
Bank of Boston, other than in a fiduciary capacity or as a result of debts
previously contracted, or (ii) held by BayBanks as treasury stock, or (iii)
shares held by stockholders as to which dissenters' rights have been exercised,
will be converted into the right to receive 2.2 shares of the common stock of
Bank of Boston, par value $2.25 per share (the "Bank of Boston Common Stock").
The shares of Bank of Boston Common Stock to be issued in the Merger will
include the corresponding number of rights attached to such shares pursuant to
Bank of Boston's shareholder rights plan. No fractional shares of Common Stock
will be issued in the Merger and BayBanks stockholders who otherwise would be
entitled to receive a fractional share of Bank of Boston Common Stock will
receive a cash payment in lieu thereof. The Merger is intended to be a tax-free
reorganization and to be accounted for as a pooling of interests.
Completion of the acquisition is subject to certain conditions, including
approval of the holders of two-thirds of the shares of BayBanks common stock
and of the holders of the majority of Bank of Boston Common Stock, the approval
of regulatory authorities, and other closing conditions customary in this type
of transaction. The Merger Agreement is subject to termination in certain
circumstances, including if the merger is not consummated by December 31, 1996.
In addition, BayBanks may terminate the Merger Agreement if the average closing
market price (the "Average Closing Price") of Bank of Boston Common Stock over
the twenty trading day period ending on the date of the final federal
regulatory action with respect to the acquisition (the "Final Calculation
Period") (a) is less than 75% of the closing market price of Bank of Boston
Common Stock on December 8, 1995, which was $47.50, (the "Conversion Price")
and (b) the number obtained by dividing the Average Closing Price by the
Conversion Price is less than the number obtained by dividing the average
of the closing prices of the Morgan Stanley 35-Bank Regional Peer Group during
the Final Calculation Period by the average of the closing prices of that Peer
Group for the 20 trading day period ending on December 8, 1995 and subtracting
.25 from the quotient.
3
-3-
Simultaneously with the execution of the Merger Agreement, on December 12, 1995,
Bank of Boston and BayBanks entered into reciprocal stock option agreements (the
"Stock Option Agreements") pursuant to which BayBanks granted Bank of Boston an
option to purchase up to 3,907,120 shares of BayBanks common stock at a price of
$83.75 per share and Bank of Boston granted to BayBanks an option to purchase up
to 22,400,761 shares of Bank of Boston Common Stock at a price of $47.50 per
share (the "Options"), in each case equaling 19.9% of the outstanding shares of
the respective granting company's stock. The Options are exercisable upon the
occurrence of certain events described in the Stock Option Agreements. The
forms of the Stock Option Agreements appear as exhibits to the Merger Agreement
which is an exhibit hereto and they are incorporated herein by reference.
The foregoing summary of the contents of the Merger Agreement and Stock Option
Agreements is qualified in its entirety by reference to Exhibit 2 hereto.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits.
(2)(a) Agreement and Plan of Merger, dated as of December 12,
1995, by and between Bank of Boston and BayBanks.
(99)(a) Press Release dated December 12, 1995 entitled "Bank of
Boston to Acquire BayBanks in $2 Billion Stock Merger."
4
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.
BANK OF BOSTON CORPORATION
Dated: December 21, 1995 /s/ Gary A. Spiess
------------------
Gary A. Spiess
General Counsel and Clerk