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EXHIBIT 2(D)
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THIS WARRANT AND THE COMMON SHARES ISSUABLE UPON THE EXERCISE HEREOF HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR REGISTERED OR
QUALIFIED UNDER ANY STATE SECURITIES LAWS, AND MAY NOT BE SOLD OR OTHERWISE
TRANSFERRED WITHOUT BEING SO REGISTERED OR QUALIFIED UNLESS AN EXEMPTION OR
EXEMPTIONS FROM SUCH REGISTRATION OR QUALIFICATION REQUIREMENTS ARE AVAILABLE.
WARRANT
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TO PURCHASE 630,080 COMMON SHARES
OF
EMPIRE BANC CORPORATION
This is to certify that, for value received, HUNTINGTON BANCSHARES
INCORPORATED, a Maryland corporation ("Huntington"), is entitled to purchase
from EMPIRE BANC CORPORATION, a Michigan corporation ("Empire"), at any time on
or after the date hereof, an aggregate of up to 630,080 common shares, without
par value, of Empire ("Empire Common"), at a price of $29.00 per share (the
"Exercise Price"), subject to the terms and conditions of this Warrant and a
certain Warrant Purchase Agreement, of even date herewith, between Huntington
and Empire (the "Warrant Purchase Agreement"). The number of shares of Empire
Common which may be received upon the exercise of this Warrant and the Exercise
Price are subject to adjustment from time to time as hereinafter set forth. The
terms and conditions set forth in this Warrant and the Warrant Purchase
Agreement shall be binding upon the respective successors and assigns of both of
the parties hereto. This Warrant is issued in connection with a certain
Agreement and Plan of Merger, dated as of the date hereof, between Huntington
and Empire (the "Merger Agreement"), which provides for the merger of Empire
into Huntington (the "Merger"), and a certain Supplemental Agreement between
Huntington and Empire, which provides certain additional terms and conditions
relating to the Merger (the "Supplemental Agreement"). (The Merger Agreement and
the Supplemental Agreement are sometimes hereinafter collectively referred to as
the "Merger Documents.") All capitalized terms used herein and not otherwise
defined herein shall have the meanings ascribed to them in the Merger Documents.
The term "Holder" shall mean and refer to Huntington or any successor holder of
this Warrant.
SECTION 1. EXERCISE OF THE WARRANT.
(a) The Holder will not exercise this Warrant unless it has
obtained all required approvals, if any, of appropriate regulatory authorities
having jurisdiction, including the Federal Reserve Board, pursuant to all
applicable laws and regulations. Further, subject to the terms and conditions
set forth in this Warrant and in the Warrant Purchase Agreement and the
provisions of applicable law, the Holder will not exercise this Warrant without
the written consent of Empire except upon the occurrence of any of the following
events (a "Triggering Event"):
(1) any material, willful, and intentional breach of the Merger
Documents by Empire that would permit Huntington to terminate
the Merger Documents (A) occurring after the receipt by Empire
after February 4, 2000, of a proposal to engage in an
Acquisition Transaction, (B) occurring after the announcement
by any other Person of an intention to engage in an
Acquisition Transaction, or (C) in anticipation and for the
purpose of engaging in an Acquisition Transaction;
(2) (A) a proposal to engage in an Acquisition Transaction is
submitted to and approved by the shareholders of Empire at any
time prior to January 31, 2001, or (B) a Tender Offer is
commenced and the transactions contemplated in the Tender
Offer are completed in such a manner that the Person making
the Tender Offer acquires beneficial ownership of more
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than 20 percent of the capital stock or any other class of
voting securities of Empire, and the Merger is not consummated
prior to January 31, 2001; or
(3) (A) a proposal to engage in an Acquisition Transaction is
received by Empire after February 4, 2000, or a Tender Offer
is made directly to the shareholders of Empire or the
intention of making an Acquisition Transaction or a Tender
Offer is announced at any time prior to the holding of the
Empire Shareholders' Meeting; (B) the Board of Directors of
Empire (1) fails to recommend to the shareholders of Empire
that they vote their shares of Empire Common in favor of the
approval of the Merger, (2) withdraws such recommendation
previously made, (3) fails to solicit proxies of shareholders
of Empire to approve the Merger, or (4) fails to hold the
Empire Shareholders' Meeting; and (C) the Merger is not
consummated by January 31, 2001.
(b) Notwithstanding the foregoing, this Warrant shall not be
exercisable in the event of the failure to consummate the Merger solely as a
result of any of the following: (1) the failure of any Regulatory Authority to
provide any required Consent to the Merger, which failure was not the result of
the existence of the Acquisition Proposal or a breach by Empire of any of its
obligations under any of the Merger Documents; or (2) the Merger Documents are
terminated pursuant to Section 9.1 of the Supplemental Agreement, unless the
event giving rise to the right to terminate is preceded by a Triggering Event or
the receipt by Empire after February 4, 2000, of an Acquisition Transaction
proposal, or the announcement by another Person of a proposal involving an
Acquisition Transaction. For purposes of this Section 1, a Tender Offer which is
contingent upon the expiration of the Warrant is deemed to commence when it is
announced. Empire represents to the Holder that, except with respect to the
Merger Documents, there are no proposals or offers to engage in an Acquisition
Transaction previously received by Empire which remain outstanding as of the
close of business on February 4, 2000. Any breach of this representation by
Empire will cause any such proposal or offer, whether in its original form or as
amended, to be deemed to be received by Empire after February 4, 2000, for
purposes of this Section 1.
(c) This Warrant shall be exercised by presentation and
surrender hereof to Empire at its principal office accompanied by (1) a written
notice of exercise for a specified number of shares of Empire Common, (2)
payment to Empire, for the account of Empire, of the Exercise Price for the
number of shares specified in such notice, and (3) a certificate of the Holder
indicating the Triggering Event that has occurred which entitles the Holder to
exercise this Warrant. The Exercise Price for the number of shares of Empire
Common specified in the notice shall be payable in immediately available funds.
(d) Upon such presentation and surrender, Empire shall issue
promptly (and within three business days if requested by the Holder) to the
Holder, or any assignee, transferee, or designee permitted by Section 1(f), the
shares to which the Holder is entitled hereunder.
(e) If this Warrant should be exercised in part only, Empire
shall, upon surrender of this Warrant for cancellation, execute and deliver a
new Warrant evidencing the rights of the Holder thereof to purchase the balance
of the shares purchasable hereunder. Upon receipt by Empire of this Warrant, in
proper form for exercise, the Holder shall be deemed to be the holder of record
of the shares of Empire Common issuable upon such exercise, notwithstanding that
the stock transfer books of Empire shall then be closed or that certificates
representing such shares of Empire Common shall not then be actually delivered
to the Holder. Empire shall pay all expenses, and any and all federal, state,
and local taxes and other charges that may be payable in connection with the
preparation, issue, and delivery of stock certificates under this Section 1 in
the name of the Holder or of any assignee, transferee, or designee permitted by
Section 1(f).
(f) This Warrant, once exercisable, or any warrant shares
acquired by the Holder by its exercise, may be sold or transferred in whole or
in part to any person, subject to the receipt by such person of approvals of
appropriate regulatory authorities having jurisdiction, including the Federal
Reserve Board, pursuant to all applicable laws and regulations, to the extent
required.
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SECTION 2. CERTAIN COVENANTS AND REPRESENTATIONS OF EMPIRE.
(a) Empire shall at all times maintain sufficient authorized
but unissued shares of Empire Common so that this Warrant may be exercised
without additional authorization of the holders of Empire Common, after giving
effect to all other options, warrants, convertible securities, and other rights
to purchase Empire Common.
(b) Empire represents and warrants to the Holder that the
shares of Empire Common issued upon an exercise of this Warrant will be duly
authorized, fully paid, non-assessable, and subject to no preemptive rights.
(c) Empire agrees (1) that it will not, by charter amendment
or through reorganization, consolidation, merger, dissolution, or sale of
assets, or by any other voluntary act, avoid or seek to avoid the observance or
performance of any of the covenants, stipulations, or conditions to be observed
or performed hereunder by Empire; (2) promptly to take all action as may from
time to time be required, including, without limitation (A) complying with all
pre-merger notification, reporting, and waiting period requirements specified in
15 U.S.C. Section 18a and regulations promulgated thereunder, and (B) in the
event, under the Bank Holding Company Act of 1956, as amended (the "Bank Holding
Company Act"), or the Change in Bank Control Act of 1978, or other statute, the
prior approval of the Federal Reserve Board or other regulatory agency
(collectively, the "Agencies"), is necessary before the Warrant may be exercised
or transferred, cooperate fully with the Holder in preparing such applications
and providing such information to the Agencies as the Agencies may require in
order to permit the Holder to exercise or transfer this Warrant and Empire duly
and effectively to issue shares pursuant to the exercise hereof; and (3)
promptly to take all action provided herein to protect the rights of the Holder
against dilution.
SECTION 3. FRACTIONAL SHARES. Empire shall not be required to issue
fractional shares of Empire Common upon an exercise of this Warrant but shall
pay for such fraction of a share in cash or by certified or official bank check
at the Exercise Price.
SECTION 4. EXCHANGE OR LOSS OF WARRANT. This Warrant is exchangeable,
without expense, at the option of the Holder, upon presentation and surrender
hereof at the principal office of Empire for other Warrants of different
denominations entitling the Holder thereof to purchase in the aggregate the same
number of shares of Empire Common purchasable hereunder. The term "Warrant" as
used herein includes any warrants for which this Warrant may be exchanged. Upon
receipt by Empire of evidence reasonably satisfactory to it of the loss, theft,
destruction, or mutilation of this Warrant, and (in the case of loss, theft, or
destruction) of reasonably satisfactory indemnification, and upon surrender and
cancellation of this Warrant, if mutilated, Empire will execute and deliver a
new Warrant of like tenor and date. Any such new Warrant executed and delivered
shall constitute an additional contractual obligation on the part of Empire,
whether or not the Warrant so lost, stolen, destroyed, or mutilated shall at any
time be enforceable by anyone.
SECTION 5. CERTAIN TRANSACTIONS.
(a) In case Empire shall (1) consolidate with or merge into
any Person, other than Huntington or one of its Affiliates, and shall not be the
continuing or surviving corporation of such consolidation or merger, (2) permit
any Person, other than Huntington or one of its Affiliates, to merge into Empire
and Empire shall be the continuing or surviving corporation, but, in connection
with such merger, the then outstanding shares of Empire Common shall be changed
into or exchanged for stock or other securities of any other Person or cash or
any other property, or (3) sell or otherwise transfer all or substantially all
of its assets to any Person, other than Huntington or one of its Affiliates,
then, and in any such case, the agreement governing such transaction shall make
proper provision so that this Warrant shall, upon the consummation of any such
transaction and upon the terms and conditions set forth herein, be converted
into, or exchanged for, a warrant, at the option of the Holder, of either (A)
the Acquiring Corporation (as hereinafter defined), (B) any company which
controls the Acquiring Corporation, or (C) in the case of a merger described in
clause (a)(2) above, Empire, in which case such warrant shall be a newly issued
warrant (in any such case, the "Substitute Warrant").
(b) For purposes of this Section 5, the following terms have
the meanings indicated:
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(1) "Acquiring Corporation" shall mean (A) the
continuing or surviving corporation of a consolidation or merger with
Empire (if other than Empire), (B) the corporation merging into Empire
in a merger in which Empire is the continuing or surviving person and
in connection with which the then outstanding shares of Empire Common
are changed into or exchanged for stock or other securities of any
other Person or cash or any other property, or (C) the transferee of
all or substantially all of Empire's assets;
(2) "Substitute Common" shall mean the common stock
issued by the issuer of the Substitute Warrant;
(3) "Assigned Value" shall mean the Market/Offer
Price as determined pursuant to paragraph 7(b) of the Warrant Purchase
Agreement; provided, however, that in the event of a sale of all or
substantially all of Empire's assets, the Assigned Value shall be the
sum of the price paid in such sale for such assets and the current
market value of the remaining assets of Empire as determined by a
recognized investment banking firm selected by the Holder, divided by
the number of shares of Empire Common outstanding at the time of such
sale;
(4) "Average Price" shall mean the average closing
price of a share of Substitute Common for the one year immediately
preceding the consolidation, merger, or sale in question, but in no
event higher than the closing price of the shares of Substitute Common
on the day preceding such consolidation, merger, or sale; provided that
if Empire is the issuer of the Substitute Warrant, the Average Price
shall be computed with respect to a share of the common stock issued by
the Person merging into Empire or by any company which controls such
Person, as the Holder may elect;
(5) A "Person" shall mean any individual, firm,
corporation, or other entity and include as well any syndicate or group
deemed to be a "person" by Section 13(d)(3) of the Securities Exchange
Act of 1934, as amended; and
(6) "Affiliate" shall have the meaning ascribed to
such term in Rule 12b-2 of the General Rules and Regulations under the
Securities Exchange Act of 1934, as amended.
(c) The Substitute Warrant shall have the same terms as this
Warrant, provided that, if the terms of the Substitute Warrant cannot, for legal
reasons, be the same as this Warrant, such terms shall be as similar as possible
and in no event less advantageous to the Holder. The issuer of the Substitute
Warrant shall also enter into an agreement with the then Holder of the
Substitute Warrant in substantially the same form as the Warrant Purchase
Agreement, which shall be applicable to the Substitute Warrant.
(d) The Substitute Warrant shall be exercisable for such
number of shares of Substitute Common as is equal to the Assigned Value
multiplied by the number of shares of Empire Common for which this Warrant is
then exercisable, divided by the Average Price. The exercise price of the
Substitute Warrant per share of Substitute Common shall be equal to the Exercise
Price multiplied by a fraction in which the numerator is the number of shares of
Empire Common for which this Warrant is then exercisable and the denominator is
the number of shares of Substitute Common for which the Substitute Warrant is
exercisable.
SECTION 6. RIGHTS OF THE HOLDER; REMEDIES.
(a) The Holder shall not, by virtue hereof and prior to the
exercise hereof, be entitled to any rights of a holder of Empire Common.
(b) Without limiting the foregoing or any remedies available
to the Holder, Empire specifically acknowledges that neither Huntington nor any
successor Holder of this Warrant would have an adequate remedy at law for any
breach of this Warrant and Empire hereby agrees that Huntington and any
successor Holder shall be entitled to specific performance of the obligations of
Empire hereunder and injunctive relief against actual or threatened violations
of the provisions hereof.
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SECTION 7. ANTIDILUTION PROVISIONS. The number of shares of Empire
Common purchasable upon the exercise hereof shall be subject to adjustment from
time to time as provided in this Section 7.
(a) In the event that Empire issues any additional shares of
Empire Common at any time after the date hereof (including pursuant to stock
option plans), the number of shares of Empire Common which can be purchased
pursuant to this Warrant shall be increased by an amount equal to 19.9 percent
of the additional shares so issued.
(b) (1) In the event that, after the date hereof, Empire pays
or makes a dividend or other distribution of any class of capital stock of
Empire in Empire Common, the number of shares of Empire Common purchasable upon
exercise hereof shall be increased by multiplying such number of shares by a
fraction of which the denominator shall be the number of shares of Empire Common
outstanding at the close of business on the day immediately preceding the date
of such distribution and the numerator shall be the sum of such number of shares
and the total number of shares constituting such dividend or other distribution,
such increase to become effective immediately after the opening of business on
the day following such distribution.
(2) In the event that, after the date hereof, outstanding
shares of Empire Common are subdivided into a greater number of shares of Empire
Common, the number of shares of Empire Common purchasable upon exercise hereof
at the opening of business on the day following the day upon which such
subdivision becomes effective shall be proportionately increased, and,
conversely, in the event that, after the date hereof, outstanding shares of
Empire Common are combined into a smaller number of shares of Empire Common, the
number of shares of Empire Common purchasable upon exercise hereof at the
opening of business on the day following the day upon which such combination
becomes effective shall be proportionately decreased, such increase or decrease,
as the case may be, to become effective immediately after the opening of
business on the day following the day upon which such subdivision or combination
becomes effective.
(3) The reclassification (including any reclassification upon
a merger in which Empire is the continuing corporation) of Empire Common into
securities including other than Empire Common shall be deemed to involve a
subdivision or combination, as the case may be, of the number of shares of
Empire Common outstanding immediately prior to such reclassification into the
number of shares of Empire Common outstanding immediately thereafter and the
effective date of such reclassification shall be deemed to be the day upon which
such subdivision or combination becomes effective, as the case may be, within
the meaning of clause (2) above.
(c) Whenever the number of shares of Empire Common purchasable
upon exercise hereof is adjusted pursuant to paragraph (b) above, the Exercise
Price shall be adjusted by multiplying the Exercise Price by a fraction the
numerator of which is equal to the number of shares of Empire Common purchasable
prior to the adjustment and the denominator of which is equal to the number of
shares of Empire Common purchasable after the adjustment.
(d) For the purpose of this Section 7, the term "Empire
Common" shall include any shares of Empire of any class or series which has no
preference or priority in the payment of dividends or in the distribution of
assets upon any voluntary or involuntary liquidation, dissolution, or winding up
of Empire and which is not subject to redemption by Empire.
SECTION 8. NOTICE.
(a) Whenever the number of shares of Empire Common for which
this Warrant is exercisable is adjusted as provided in Section 7 hereof, Empire
shall promptly compute such adjustment and mail to the Holder a certificate,
signed by a principal financial officer of Empire, setting forth the number of
shares of Empire Common for which this Warrant is exercisable and the adjusted
Exercise Price as a result of such adjustment, a brief statement of the facts
requiring such adjustment, the computation thereof, and when such adjustment
will become effective.
(b) Upon the occurrence of a Triggering Event, Empire shall
(1) promptly notify the Holder and/or the "Owner" (as that term is defined in
the Warrant Purchase Agreement) of such event, (2) promptly compute the "Warrant
Repurchase Price" and the "Warrant Stock Repurchase Price" (as such terms are
defined in the Warrant Purchase Agreement), and (3) furnish to the Holder and/or
the Owner a certificate, signed by the chief
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financial officer of Empire setting forth the Warrant Repurchase Price and/or
the Warrant Stock Repurchase Price and the basis and computation thereof.
(c) Upon the occurrence of an event which results in this
Warrant becoming convertible into, or exchangeable for, the Substitute Warrant,
as provided in Section 5 hereof, Empire and the Acquiring Corporation shall
promptly notify the Holder of such event; and, upon receipt from the Holder of
its choice as to the issuer of the Substitute Warrant, the Acquiring Corporation
shall promptly compute the number of shares of Substitute Common for which the
Substitute Warrant is exercisable and furnish to the Holder a certificate,
signed by a principal financial officer of the Acquiring Corporation, setting
forth the number of shares of Substitute Common for which the Substitute Warrant
is exercisable, the Substitute Warrant exercise price, a computation thereof,
and when such adjustment will become effective.
SECTION 9. TERMINATION. This Warrant and the rights conferred hereby
shall terminate upon the earliest of (1) six months after the occurrence of a
Triggering Event, (2) the Effective Date of the Merger, (3) the date of
termination of the Merger Documents unless the event giving rise to the right to
terminate is preceded by a Triggering Event or the receipt by Empire, or the
announcement by another Person, of a proposal involving an Acquisition
Transaction or Tender Offer, or (4) March 31, 2001.
IN WITNESS WHEREOF, the undersigned has executed this Warrant as of
this 4th day of February, 2000.
ATTEST: EMPIRE BANC CORPORATION
By: /s/ William T. Fitzgerald, Jr. By:/s/ James E. Dutmers, Jr.
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William T. Fitzgerald, Jr. James E. Dutmers, Jr.,
Title: Secretary Chairman and Chief Executive Officer
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