One who intends to leave others better off for his having existed.

11/26/14

From the Wells Fargo Wachovia Merger Agreement

"Liquidity continued to decline and by the end of September 26, Wachovia’s management was concerned that, without accessing the Federal Reserve’s discount borrowing window, Wachovia’s banking subsidiaries would not be able to fund normal banking activities on Monday, September 29. Wachovia had been regularly reviewing its liquidity situation with the Federal Reserve and the OCC, who on that day remained on site.

Wachovia held a telephonic board of directors meeting on Friday, September 26 during which management advised the board of directors of the status of Wachovia’s liquidity situation, the status of the various strategic alternatives, including that the capital raising alternative was no longer a viable option, and the status of discussions with regulatory authorities about Wachovia’s financial condition.

...On Saturday, September 27, and in an early morning meeting on September 28, Mr. Kovacevich, the Chairman of Wells Fargo, told Mr. Steel that Wells Fargo was considering an offer to purchase all of Wachovia in a stock-for-stock transaction, pending completion of due diligence activities. Mr. Kovacevich commented that Wells Fargo was working on a transaction that would not require government assistance and that he believed Wells Fargo could meet the Monday morning timetable.

...Wachovia held a telephonic meeting of its board of directors at approximately 9:00 p.m. on September 28 to advise the board of the current situation and the FDIC’s position. Legal counsel discussed with the board matters regarding its fiduciary duties relative to shareholders and, in the existing context, creditors.

The merger agreement also provides that for a period of six years after the merger is completed, Wells Fargo will provide director’s and officer’s liability insurance for the present and former officers and directors of Wachovia with respect to claims arising from facts or events occurring before the merger is completed. This director’s and officer’s liability insurance will contain at least the same coverage and amounts, and terms and conditions no less advantageous, as Wachovia’s existing coverage.

...Wachovia held a telephonic board of directors meeting at 6:30 a.m. on Monday, September 29 to advise the board of the events that had developed during the night. Legal counsel to Wachovia described the terms of the non-binding agreement-in-principle. Management informed the board that it was faced with two options: (1) execute the agreement-in-principle with Citigroup and the FDIC or (2) have the FDIC place Wachovia’s banking subsidiaries into receivership, which likely would require Wachovia Corporation to file a bankruptcy petition soon thereafter.

...On Thursday, October 2, Wells Fargo had discussions internally and with its legal counsel, Wachtell, Lipton, Rosen & Katz, and its financial advisor, JPMorgan Securities, regarding Wachovia and the announcement about Wachovia and Citigroup. ...Wells Fargo executives reviewed information regarding Wachovia and analyzed the financial implications of a potential transaction.

...In the evening of October 2, the Wells Fargo board of directors met, together with management and Wells Fargo’s legal and financial advisors, to consider the proposed transaction with Wachovia. Following extensive discussion the Wells Fargo board unanimously approved the proposed merger with Wachovia and directed management to execute a merger agreement and deliver it to representatives of Wachovia.

...At Mr. Steel’s request, Chairman Bair next telephoned Jane Sherburne, Wachovia’s General Counsel, and provided additional details of the proposed Wells Fargo transaction, including that it would not require any government assistance...

...The Audit Committee expressly approved Wachovia’s decision not to seek shareholder approval for the issuance and sale of Series M Preferred Stock to Wells Fargo pursuant to the share exchange agreement in reliance on an exception contained in the New York Stock Exchange rules. The Audit Committee members were present during the board discussions ...and had the benefit of those discussions in making the determination regarding Wachovia’s financial viability.

...At approximately 7:00 a.m. on October 3, Wells Fargo and Wachovia issued a joint news release announcing the merger agreement.

...As of the date of this proxy statement-prospectus, Wachovia’s 10 executive officers, excluding Robert K. Steel who is discussed below, in the aggregate held [•] unvested Wachovia stock options at a weighted average exercise price of $[•] per Wachovia share, which will vest upon completion of the merger.

Robert K. Steel Agreement.  Wachovia did not enter into an employment agreement with Mr. Steel upon his hiring in July 2008. Mr. Steel received 1,500,000 Wachovia stock options with an exercise price of $9.08 per Wachovia share and 1,990,089 performance-based Wachovia RSAs that vest upon Wachovia common stock reaching certain price thresholds and his continued employment with Wachovia through July 15, 2011. Following the change in control as a result of the merger, all of Mr. Steel’s stock options will vest and be converted into stock options to purchase shares of Wells Fargo common stock, as adjusted by the exchange ratio. In addition, following the change in control as a result of the merger, Mr. Steel’s performance-based RSAs will not vest until Wells Fargo common stock reaches certain price thresholds, ranging from $100.45 per share to $175.79 per share and his continued service requirement will lapse. These price thresholds must occur prior to July 15, 2014 or the unvested RSAs will be forfeited.

Mr. Steel is also entitled to receive a gross-up payment equal to the amount of federal excise taxes under Section 4999 of the Internal Revenue Code (plus the applicable federal and state income, FICA and excise taxes due on such gross-up payment) payable by him in conjunction with a change in control of Wachovia and such taxes become payable, as a result of payments under the stock award agreement or otherwise, and are deemed to be “excess parachute payments” for federal income tax purposes. The foregoing payments, if any, to Mr. Steel are subject to the limits imposed by Wachovia’s severance policy, which limits the total amount of severance benefits to be paid to any executive to 2.99 times the sum of the executive’s base salary and annual cash incentive award.

No such Company SEC Report or communication, at the time filed, furnished or communicated (and, in the case of registration statements and proxy statements, on the dates of effectiveness and the dates of the relevant meetings, respectively), contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances in which they were made, not misleading, except that information as of a later date (but before the date of this Agreement) shall be deemed to modify information as of an earlier date. As of their respective dates, all Company SEC Reports complied as to form in all material respects with the published rules and regulations of the SEC with respect thereto. As of the date of this Agreement, no executive officer of Company has failed in any respect to make the certifications required of him or her under Section 302 or 906 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”).

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF COMPANY

3.1 Corporate Organization.

(a) Company is a corporation duly incorporated, validly existing and in good standing under the laws of the State of North Carolina. Company has the requisite corporate power and authority to own or lease all of its properties and assets and to carry on its business as it is now being conducted, and is duly licensed or qualified to do business in each jurisdiction in which the nature of the business conducted by it or the character or location of the properties and assets owned or leased by it makes such licensing or qualification necessary.

...3.13 Company Information. The information relating to Company and its Subsidiaries that is provided by Company or its representatives for inclusion in the Proxy Statement and Form S-4, or in any application, notification or other document filed with any other Regulatory Agency or other Governmental Entity in connection with the transactions contemplated by this Agreement, will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances in which they are made, not misleading. The portions of the Proxy Statement relating to Company and its Subsidiaries and other portions within the reasonable control of Company and its Subsidiaries will comply in all material respects with the provisions of the Exchange Act and the rules and regulations thereunder.

...No such Parent SEC Report or communication, at the time filed, furnished or communicated (and, in the case of registration statements and proxy statements, on the dates of effectiveness and the dates of the relevant meetings, respectively), contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances in which they were made, not misleading, except that information as of a later date (but before the date of this Agreement) shall be deemed to modify information as of an earlier date. As of their respective dates, all Parent SEC Reports complied as to form in all material respects with the published rules and regulations of the SEC with respect thereto. As of the date of this Agreement, no executive officer of Parent has failed in any respect to make the certifications required of him or her under Section 302 or 906 of the Sarbanes-Oxley Act.

4.10 Parent Information. The information relating to Parent and its Subsidiaries that is provided by Parent or its representatives for inclusion in the Proxy Statement and the Form S-4, or in any application, notification or other document filed with any other Regulatory Agency or other Governmental Entity in connection with the transactions contemplated by this Agreement, will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances in which they are made, not misleading. The portions of the Proxy Statement relating to Parent and its Subsidiaries and other portions within the reasonable control of Parent and its Subsidiaries will comply in all material respects with the provisions of the Exchange Act and the rules and regulations thereunder. The Form S-4 will comply in all material respects with the provisions of the Securities Act and the rules and regulations thereunder."

IN WITNESS WHEREOF, Company and Parent have caused this Agreement to be executed by their respective officers thereunto duly authorized as of the date first above written.

WELLS FARGO & COMPANY

By: /s/  Richard Kovacevich
Name: Richard Kovacevich
Title: Chairman

WACHOVIA CORPORATION

By: /s/  Robert K. Steel
Name: Robert K. Steel
Title: President and CEO
.
.
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement on Form S-4 to be signed on its behalf by the undersigned, thereunto duly authorized, in the city of San Francisco, state of California, on October 31, 2008.

WELLS FARGO & COMPANY

By: /s/ John G. Stumpf
Name: John G. Stumpf
 Title: President and Chief Executive Officer

Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed on October 31, 2008 by the following persons in the capacities indicated:

/s/  John G. Stumpf
John G. Stumpf President and Chief Executive Officer
(Principal Executive Officer)

/s/  Howard I. Atkins
Howard I. Atkins Senior Executive Vice President and
Chief Financial Officer
(Principal Financial Officer)

/s/  Richard D. Levy
Richard D. Levy Executive Vice President and Controller
(Principal Accounting Officer)

John S. Chen* Lloyd H. Dean*

Susan E. Engel* Enrique Hernandez, Jr.*

Robert L. Joss* Richard M. Kovacevich*

Richard D. McCormick* Cynthia H. Milligan*

Nicholas G. Moore* Philip J. Quigley*

Donald B. Rice* Judith M. Runstad*

Stephen W. Sanger* John G. Stumpf*

Susan G. Swenson* Michael W. Wright*

* John G. Stumpf, by signing his name hereto, does hereby sign this document on behalf of each of the directors named above pursuant to powers of attorney duly executed by such persons.

/s/  John G. Stumpf
John G. Stumpf
Attorney-in-Fact

http://www.sec.gov/Archives/edgar/data/72971/000095012308013965/y72243sv4.htm#146

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