-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, O8HOllkrLbCrnT8+4gJmTApBrf4XNvB+Sh7Uw3d62DYU9ukAmt5S3LLcrKmSpqsi lG2ZfLIM6B/dRkweR6iJ9Q== 0000950144-00-005137.txt : 20000418 0000950144-00-005137.hdr.sgml : 20000418 ACCESSION NUMBER: 0000950144-00-005137 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20000416 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 20000417 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BANCORPSOUTH INC CENTRAL INDEX KEY: 0000701853 STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022] IRS NUMBER: 640659571 STATE OF INCORPORATION: MS FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-12991 FILM NUMBER: 603514 BUSINESS ADDRESS: STREET 1: ONE MISSISSIPPI PL CITY: TUPELO STATE: MS ZIP: 38801 BUSINESS PHONE: 6626802000 MAIL ADDRESS: STREET 1: PO BOX 789 CITY: TUPELO STATE: MS ZIP: 38802-0789 FORMER COMPANY: FORMER CONFORMED NAME: BANCORP OF MISSISSIPPI INC DATE OF NAME CHANGE: 19920703 8-K 1 BANCORPSOUTH, INC. 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): April 17, 2000 (April 16, 2000) ------------------------------ BANCORPSOUTH, INC. (Exact Name of Registrant as Specified in Its Charter)
MISSISSIPPI 0-10826 64-0659571 - -------------------------------- -------------------------------- ------------------------------- (State or Other Jurisdiction (Commission File Number) (I.R.S. Employer of Incorporation) Identification Number)
ONE MISSISSIPPI PLAZA TUPELO, MISSISSIPPI 38804 ----------------------------------- -------------------------- (Address of Principal Executive (Zip Code) Offices) (662) 680-2000 (Registrant's Telephone Number, Including Area Code) NOT APPLICABLE (Former Name or Former Address, if Changed from Last Report) ================================================================================ 2 ITEM 5. OTHER EVENTS BancorpSouth, Inc. and First United Bancshares, Inc. have entered into an Agreement and Plan of Merger, dated as of April 16, 2000 (the "Merger Agreement"), pursuant to which First United is to merge with and into BancorpSouth upon the terms and subject to the conditions set forth in the Merger Agreement. A copy of BancorpSouth's and First United's April 17, 2000 joint press release describing the transaction is attached hereto as Exhibit 99.1 and is incorporated herein by reference. Copies of materials used in connection with BancorpSouth's conference call held on April 17, 2000 are attached hereto as Exhibit 99.2 and are incorporated herein by reference. Certain statements contained in this Report and the exhibits hereto may not be based on historical facts and are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements may be identified by their reference to a future period or periods or by the use of forward-looking terminology, such as "anticipate," "believe," "estimate," "expect," "may," "might," "will," "would," or "intend." These forward-looking statements include, without limitation, those relating to the Company's future changes, the accretive effect of the merger, accounting and tax treatments of the merger and the effects of the merger. We caution you not to place undue reliance on the forward-looking statements contained in this news release in that actual results could differ materially from those indicated in such forward-looking statements, due to a variety of factors. Those factors include, but are not limited to, failure to obtain required shareholder or regulatory approvals, the companies' failure to consummate the merger, inability to successfully integrate the companies after the merger, materially adverse changes in the companies' financial conditions, changes in economic conditions and government fiscal and monetary policies, fluctuations in prevailing interest rates, the ability of the Company to compete with other financial services companies, changes in the Company's operating or expansion strategy, geographic concentration of the Company's assets, the ability of the Company to attract, train, and retain qualified personnel, the ability of the Company to effectively market its services and products, the Company's dependence on existing sources of funding, and other factors generally understood to affect the financial results of financial service companies, and other risks detailed from time to time in the Company's news releases and filings with the Securities and Exchange Commission. We undertake no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date on which such statements were made. ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS (c) The following exhibits are filed herewith: Exhibit Number Description - -------------- ----------- 99.1 Press Release jointly issued on April 17, 2000 by BancorpSouth, Inc. and First United Bancshares, Inc. 99.2 Materials for investor presentations held by BancorpSouth, Inc. to discuss the merger 3 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. BANCORPSOUTH, INC. By: /s/ L. NASH ALLEN, JR. ---------------------------------------- L. Nash Allen, Jr. Treasurer and Chief Financial Officer Date: April 17, 2000 4 EXHIBIT INDEX
Exhibit Number Description - -------------- ----------- 99.1 Press Release jointly issued on April 17, 2000 by BancorpSouth, Inc. and First United Bancshares, Inc. 99.2 Materials for investor presentations held by BancorpSouth, Inc. to discuss the merger
EX-99.1 2 PRESS RELEASE 1 EXHIBIT 99.1 NEWS RELEASE FOR THE NEWS MEDIA: TO PARTICIPATE IN A 9:00 A.M. CDT, MONDAY, APRIL 17, TELE-NEWS CONFERENCE, DIAL TOLL-FREE 1-888-831-6081, CODE # 52031 FOR ANALYSTS: TO PARTICIPATE IN A 10:00 A.M., CDT, MONDAY, APRIL 17, ANALYSTS PRESENTATION, DIAL TOLL-FREE 1-800-857-4882, CODE # 57376 Financial Contact: BancorpSouth, L. Nash Allen, 662-680-2330 First United, John Copeland, 870-863-3181 Media Contact: BancorpSouth: Harry Baxter, 662-680-2410 Randy Burchfield, 662-680-2216 First United, Cindy Alphin, 870-863-3181, #332 On-line: www.bancorpsouth.com FOR IMMEDIATE RELEASE April 17, 2000 BANCORPSOUTH AND FIRST UNITED BANCSHARES ANNOUNCE MERGER AGREEMENT EL DORADO, Ark. and TUPELO, Miss. - April 17, 2000 - BancorpSouth, Inc. (NYSE: BXS) and First United Bancshares, Inc. (NASDAQ: UNTD) said today they have signed a definitive agreement for the merger of BancorpSouth and First United, which would create a six-state regional financial services company. Under the terms of the agreement which has been approved by the boards of both companies, First United stockholders would receive 1.125 shares of BancorpSouth common stock in exchange for each share of First United stock. The transaction, based on BancorpSouth's closing stock price of $16.00 on April 14, 2000, values each First United share at $18.00, or a premium to First United's closing price on April 14th of approximately 43%, for a total transaction value of approximately $455 million. The transaction is expected to be completed in the third quarter of this year and to be accounted for as a pooling of interests. Approval of banking regulators and both BancorpSouth and First United shareholders is required. The transaction is expected to be tax-free for First United stockholders. Each party has granted the other an option to purchase up to 19.9% of its outstanding shares in certain circumstances. BancorpSouth expects to incur related after-tax merger and restructuring charges of approximately $20 million. The merger is expected to be accretive to earnings in 2001. First United, based in El Dorado, Ark., at year-end 1999 had $2.7 billion in assets. It operates 11 affiliate banks and a non-bank subsidiary, First United Trust Company N.A., from 69 banking locations with approximately 1,000 employees in Arkansas, Louisiana and Texas. The company has a strong position in the major markets it serves. "We are dedicated to our communities, our employees and our shareholders. That is why this merger is such a good fit. BancorpSouth, like First United, has always been very close to the people and communities it serves," said James V. Kelley, Chairman of the Board, President and CEO of First United. "BancorpSouth serves similar markets in Mississippi, Alabama and Tennessee to the ones we serve in Arkansas, Louisiana and Texas. The level of technology and 2 information systems that BancorpSouth brings to this merger would enhance our ability to identify and meet the needs of our customers. BancorpSouth is an ideal partner for us." "First United's dedicated staff has earned a reputation for expertise and service in its market area. Our similarities are many, and the merging of our companies is an excellent opportunity for us all. Just like First United, we take pride in the fact that we are close to the communities we serve," said Aubrey B. Patterson, Chairman and CEO of BancorpSouth. "We both understand the importance of building long lasting relationships with our customers. In fact, our success and profitability depend on our ability to add value in the lives of our stakeholders - our employees, our shareholders and our customers. By uniting our energies, our bank will leave a regional footprint over six states." Kelley would become president and chief operating officer of BancorpSouth after the merger, while Patterson would continue as Chairman and CEO. On a combined basis, BancorpSouth would have 13 members on its board of directors, of which four would come from the current First United Board. The definitive agreement with regard to the transaction has been signed. Each party performed due diligence on the other during the week of April 10th. An additional three-week due diligence period will commence upon the announcement of the transaction during which either party will have the right to terminate the transaction only in the event of a material difference in expectations based upon information presented in the companies' 10-Ks for 1999. The combined company would have assets of approximately $8.6 billion, deposits of $7.25 billion and shareholders' equity of $758 million. It would operate in Alabama, Arkansas, Louisiana, Mississippi, Tennessee and Texas. The merger would make BancorpSouth the largest Mississippi-based banking company in terms of total assets. Headquartered in Tupelo, Miss., BancorpSouth is a financial services company with $5.8 billion in assets operating 167 banking and mortgage locations and 170 ATMs in 87 Mississippi, Tennessee and Alabama communities. The Company also provides investment services through its subsidiary, BancorpSouth Investment Services Inc. and insurance services through BancorpSouth Insurance Services. BancorpSouth's common stock is traded on the New York Stock Exchange under the symbol BXS. ### FORWARD-LOOKING STATEMENTS CERTAIN STATEMENTS CONTAINED IN THIS NEWS RELEASE MAY NOT BE BASED ON HISTORICAL FACTS AND ARE "FORWARD-LOOKING STATEMENTS" WITHIN THE MEANING OF SECTION 27A OF THE SECURITIES ACT OF 1933, AS AMENDED, AND SECTION 21E OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. THESE FORWARD-LOOKING STATEMENTS MAY BE IDENTIFIED BY THEIR REFERENCE TO A FUTURE PERIOD OR PERIODS OR BY THE USE OF FORWARD-LOOKING TERMINOLOGY, SUCH AS "ANTICIPATE," "BELIEVE," "ESTIMATE," "EXPECT," "MAY," "MIGHT," "WILL," "WOULD," OR "INTEND." THESE FORWARD-LOOKING STATEMENTS INCLUDE, WITHOUT LIMITATION, THOSE RELATING TO THE COMPANY'S FUTURE CHANGES, THE ACCRETIVE EFFECT OF THE MERGER, ACCOUNTING AND TAX TREATMENTS OF THE MERGER AND THE EFFECTS OF THE MERGER. WE CAUTION YOU NOT TO PLACE UNDUE RELIANCE ON THE FORWARD-LOOKING STATEMENTS CONTAINED IN THIS NEWS RELEASE IN THAT ACTUAL RESULTS COULD DIFFER MATERIALLY FROM THOSE INDICATED IN SUCH FORWARD-LOOKING STATEMENTS, DUE TO A VARIETY OF FACTORS. THOSE FACTORS INCLUDE, BUT ARE NOT LIMITED TO, FAILURE TO OBTAIN REQUIRED SHAREHOLDER OR REGULATORY APPROVALS, THE COMPANIES' FAILURE TO CONSUMMATE THE MERGER, INABILITY TO SUCCESSFULLY INTEGRATE THE COMPANIES AFTER THE MERGER, MATERIALLY ADVERSE CHANGES IN THE COMPANIES' FINANCIAL CONDITIONS, CHANGES IN ECONOMIC CONDITIONS AND GOVERNMENT FISCAL AND MONETARY POLICIES, FLUCTUATIONS IN PREVAILING INTEREST RATES, THE ABILITY OF THE COMPANY TO COMPETE WITH OTHER FINANCIAL SERVICES COMPANIES, CHANGES IN THE 3 COMPANY'S OPERATING OR EXPANSION STRATEGY, GEOGRAPHIC CONCENTRATION OF THE COMPANY'S ASSETS, THE ABILITY OF THE COMPANY TO ATTRACT, TRAIN, AND RETAIN QUALIFIED PERSONNEL, THE ABILITY OF THE COMPANY TO EFFECTIVELY MARKET ITS SERVICES AND PRODUCTS, THE COMPANY'S DEPENDENCE ON EXISTING SOURCES OF FUNDING, AND OTHER FACTORS GENERALLY UNDERSTOOD TO AFFECT THE FINANCIAL RESULTS OF FINANCIAL SERVICE COMPANIES, AND OTHER RISKS DETAILED FROM TIME TO TIME IN THE COMPANY'S NEWS RELEASES AND FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION. WE UNDERTAKE NO OBLIGATION TO UPDATE THESE FORWARD-LOOKING STATEMENTS TO REFLECT EVENTS OR CIRCUMSTANCES THAT OCCUR AFTER THE DATE ON WHICH SUCH STATEMENTS WERE MADE. THIS NEWS RELEASE MAY BE DEEMED TO BE SOLICITATION MATERIAL WITH RESPECT TO THE PROPOSED MERGER OF BANCORPSOUTH AND FIRST UNITED. BANCORPSOUTH AND ITS DIRECTORS MAY BE DEEMED TO BE PARTICIPANTS IN THE SOLICITATION OF PROXIES WITH RESPECT TO A SHAREHOLDER MEETING TO BE HELD IN CONNECTION WITH SUCH MERGER. BANCORPSOUTH'S DIRECTORS INCLUDE SHED H. DAVIS, HASSELL H. FRANKLIN, FLETCHER H. GOODE, M.D., W. G. HOLLIMAN, JR., A. DOUGLAS JUMPER, TURNER O. LASHLEE, AUBREY B. PATTERSON, ALAN W. PERRY, TRAVIS E. STAUB, ANDREW R. TOWNES, D.D.S. AND LOWERY A. WOODALL. AS OF JANUARY 31, 2000, HASSELL H. FRANKLIN WAS THE BENEFICIAL OWNER OF APPROXIMATELY 923,461 SHARES OF BANCORPSOUTH COMMON STOCK (OR APPROXIMATELY 1.61% OF THE OUTSTANDING SHARES OF BANCORPSOUTH COMMON STOCK), AND EACH OF THE OTHER DIRECTORS OF BANCORPSOUTH BENEFICIALLY OWNED LESS THAN 1% OF THE OUTSTANDING SHARES OF BANCORPSOUTH COMMON STOCK. FIRST UNITED AND ITS DIRECTORS MAY BE DEEMED TO BE PARTICIPANTS IN THE SOLICITATION OF PROXIES WITH RESPECT TO A SHAREHOLDER MEETING TO BE HELD IN CONNECTION WITH SUCH MERGER. FIRST UNITED'S DIRECTORS INCLUDE E. LARRY BURROW, CLAIBORNE P. DEMING, AL GRAVES, JR., TOMMY HILLMAN, JAMES V. KELLEY, ROY E. LEDBETTER, MICHAEL F. MAHONY, RICHARD H. MASON, JACK W. MCNUTT, GEORGE F. MIDDLEBROOK, III, R. MADISON MURPHY, ROBERT C. NOLAN, CAL PARTEE, JR., CAROLYN TENNYSON AND JOHN D. TRIMBLE, JR. AS OF FEBRUARY 1, 2000, CLAIBORNE P. DEMING, R. MADISON MURPHY, ROBERT C. NOLAN AND CAL PARTEE, JR. WERE THE BENEFICIAL OWNERS, RESPECTIVELY, OF APPROXIMATELY 393,290 (1.55%), 602,440 (2.38%), 531,756 (2.10%) AND 465,506 (1.84%) SHARES OF FIRST UNITED BANCSHARES, INC. COMMON STOCK AND EACH OF THE OTHER DIRECTORS OF FIRST UNITED BENEFICIALLY OWNED LESS THAN 1% OF THE OUTSTANDING SHARES OF FIRST UNITED COMMON STOCK. JAMES V. KELLEY HAS ENTERED INTO A STOCK BONUS AGREEMENT AND A CHANGE OF CONTROL AGREEMENT WITH BANCORPSOUTH WHICH WILL BE EFFECTIVE UPON CLOSING OF THE MERGER. IN CONNECTION WITH THE PROPOSED MERGER, BANCORPSOUTH WILL FILE A REGISTRATION STATEMENT ON FORM S-4 WITH THE SECURITIES AND EXCHANGE COMMISSION. SHAREHOLDERS OF BANCORPSOUTH AND FIRST UNITED ARE ENCOURAGED TO READ THE REGISTRATION STATEMENT, INCLUDING THE JOINT PROXY STATEMENT/PROSPECTUS THAT WILL BE PART OF THE REGISTRATION STATEMENT, BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION ABOUT THE MERGER, BANCORPSOUTH AND FIRST UNITED. AFTER THE REGISTRATION STATEMENT IS FILED WITH THE SEC, IT WILL BE AVAILABLE FOR FREE, BOTH ON THE SEC'S WEB SITE (WWW.SEC.GOV) AND FROM BANCORPSOUTH'S AND FIRST UNITED'S CORPORATE SECRETARIES. ### EX-99.2 3 MATERIALS FOR INVESTOR PRESENTATIONS 1 EXHIBIT 99.2 Investor Presentation Materials 2 [LOGO BANCORP SOUTH] EXPANDING THE MID-SOUTH FINANCIAL SERVICES PLATFORM FIRST UNITED BANCSHARES, INC. April 17, 2000 3 Forward Looking Statement The forward-looking statements being made today are subject to risks and uncertainties. The actual results of BancorpSouth, Inc. ("BancorpSouth") and First United Bancshares, Inc. ("First United") may differ materially from those set forth in such forward-looking statements. Reference is made to BancorpSouth's and First United's reports filed with the Securities and Exchange Commission for a discussion of factors that may cause such differences to occur. 1 4 Key Transaction Terms Fixed Exchange Ratio: 1.125 BancorpSouth shares per First United Share Purchase Price per First United Share: $18.00(1) Transaction Value: $460 million(1)(2) Implied Market Premium: 42.6%(3) Pro Forma Market Capitalization: $1,375 million Company Name: BancorpSouth, Inc. Headquarters: Tupelo, MS Board Representation: 4 Additional Directors from First United (Total of 13) Executive Management: Aubrey B. Patterson, Chairman & CEO James V. Kelley, President & COO L. Nash Allen Jr., CFO
(1) Based on BancorpSouth share price of $16.00 as of April 14, 2000 (2) Based on 25.6 million fully diluted First United shares outstanding as of December 31, 1999 (3) Based on First United price of $12.625 on April 14, 2000 2 5 Key Structural Terms Transaction Structure: Pooling-of-interests Tax-free exchange of shares Ownership Split: 66.8% BXS / 33.2% UNTD Lock-up Option: Cross lock-ups of 19.9%, struck at market Expected Closing: 3Q 2000 Expected Merger-Related Charges: $31 M pre-tax, $20 M after-tax Due Diligence: Pre-signing - Week of April 10, 2000 Post-signing - Completed by May 8, 2000 Required Approvals: Regulatory: - Federal Reserve - FDIC - OCC - States of Mississippi, Arkansas, Louisiana & Texas BancorpSouth and First United Shareholders
3 6 FIRST UNITED BANCSHARES, INC. - First United Bancshares, Inc. is a multi-bank holding company that operates 11 subsidiary banks and 1 - 62 branches throughout Arkansas, Northern Louisiana and Eastern Texas - At December 31, 1999, First United had total consolidated assets of $2.7 billion, loans of $1.5 billion, - Today announced 1st-Quarter 2000 earnings of $0.34 per share, a 6.3% increase over 1st-Quarter 1999 4 7 TRANSACTION RATIONALE - - Entry into Attractive New Markets - - Leveraging First United's Branch Network - - Strong Management Additions - - Fairly Priced Transaction - - Financially Attractive - - History of Successful Merger Integration and Customer Retention - - Exciting Opportunity 5 8 BUILDING A SIX STATE REGIONAL PLATFORM [MAP] Pro Forma Deposits by State
State Deposits % of Total -------- ---------- Mississippi $3,367 48.2% Arkansas 1,520 21.8 Tennessee 825 11.8 Alabama 525 7.5 Texas 486 7.0 Louisiana 256 3.7 ------ ----- Total: $6,979 100.0% ====== =====
MORE THAN HALF OF PRO FORMA DEPOSITS OUTSIDE HOME STATE SOURCE: SNL SECURITIES; DATA AS OF JUNE 30, 1999. 6 9 ENTRY INTO ATTRACTIVE NEW MARKETS DIVERSIFIED, GROWING MARKETS WITH AVERAGE MEDIAN INCOME GROWTH RATES ABOVE THE NATIONAL AVERAGE OF 12.2%
MARKET SHARE MEDIAN INCOME DEPOSITS RANK GROWTH RATE (2) MAJOR INDUSTRIES -------- ------ --------------- ---------------- Tupelo, MS(1) $433.4 1 24.2% Mfg./Healthcare Hattiesburg, MS 408.4 1 14.0 Education/Healthcare Jackson, TN 288.1 1 18.7 Mfg./Retail Services Fort Smith, AR-OK 469.3 2 13.1 Healthcare/Light Mfg. Jackson, MS 486.6 3 16.4 Telecom/Government Biloxi-Gulfport, MS 255.8 4 15.4 Tourism/Military Memphis, TN-AR-MS 488.0 6 15.3 Distribution Center Shreveport-Bossier City, LA 104.8 6 14.8 Tourism/Energy Monroe, LA 74.3 6 12.4 Agriculture/Education Birmingham, AL 206.3 11 15.9 Manufacturing
(1) City of Tupelo and surrounding counties (2) Source: SNL Branch Migration; growth rates span 2000-2004 7 10 CHANGING THE REGIONAL COMPETITIVE LANDSCAPE
MARKET MARKET RANK INSTITUTION DEPOSITS BRANCHES SHARE CAPITALIZATION(1)(1) ----------- -------- -------- ------ -------------------- 1 Regions $11,556 293 6.4%. $ 4,563 2 AmSouth 9,559 257 5.3. 5,708 3 Union Planters 8,149 307 4.5. 3,859 - ----------------------------------------------------------------------------------------------- 4 BXS/UNTD PRO FORMA 6,979 229 3.9. 1,375 - ----------------------------------------------------------------------------------------------- 4 First Tennessee 6,971 71 3.9. 2,395 5 SouthTrust 6,712 94 3.7. 4,164 6 BANCORPSOUTH 4,717 167 2.6. 915 7 Bank of America 4,209 101 2.3. 83,138 8 Trustmark 3,848 139 2.1. 1,253 9 Hibernia 3,122 80 1.7. 1,642 10 National Commerce 2,841 46 1.6. 1,920 12 FIRST UNITED BANCSHARES 2,262 62 1.3. 323
N.B. Region defined as pro forma MSA's of BancorpSouth and First United (1) Fully diluted market capitalizations as of April 14, 2000 Source: SNL Branch Migration data as of June 30, 1999 8 11 LEVERAGING FIRST UNITED'S BRANCH NETWORK - - Expanded product offerings for all First United customers: - Commercial Insurance - Life Insurance - Trust and Brokerage - Mortgage Banking - Credit & Debit Cards - Leasing - Cash Management - Student Loans - - Successful implementation of STAR sales and service process into First United markets - - First United low cost funding (20 bps advantage vs. BancorpSouth) used to support loan growth throughout BancorpSouth existing markets 9 12 APPLYING FIRST UNITED'S EXCESS LIQUIDITY & CAPITAL - - Redeployment of excess liquidity into higher-yielding assets - First United has AFS securities of $729 million, yielding 6.21% - First United has a loan to deposit ratio of 66.1% - - Pick-up in BancorpSouth capital ratios can be leveraged in future purchase accounting acquisitions or balance sheet growth
BancorpSouth Pro Forma Pick-Up ------------ --------- ------- Leverage Ratio 8.34% 8.76% 42 bps Total Capital Ratio 12.80 13.67 87 Tier 1 Capital Ratio 11.49 12.70 121
10 13 STRONG MANAGEMENT ADDITIONS - - James V. Kelley, 50 - First United CEO since 1985 - President and COO of the combined company - Executive management expertise - - Regional chairmen from First United: - John Robert Graves South Arkansas Region - Jim Harwood North and West Arkansas Region - Gordon Lewis Texas and Louisiana Region - - Knowledge of local markets - - Help facilitate transition and retention of customers 11 14 FAIRLY PRICED TRANSACTION
TRANSACTION COMPARABLE TRANSACTION/ MULTIPLES MEDIAN COMPARABLES Price as Multiple of: LTM Normalized EPS(1) 13.6x 14.7x 93% Forward EPS(2) 12.9 13.4 96 Forward+1 EPS(2) 12.0 12.2 98 Book Value(1)(3) 1.74x 2.09x 83 Tangible Book Value(1)(3) 1.85 2.39 77 Premium to Deposits(1)(3) 9.4% 15.0% 63 Premium to Market(4) 42.6 27.2 157
Note: Transactions include WFC / FSCO, NCBC / CCB and BBT / OV (1) Based on First United financial results for the year ended December 31, 1999 (2) Earnings based on median IBES estimates as of April 14, 2000 (3) Book value includes the exercise of options (4) Based on First United price of $12.625 on April 14, 2000 12 15 RESTRUCTURING AND MERGER RELATED CHARGES (Dollars in 000's, except per share amounts)
PROJECTED --------- AFTER TAX ESTIMATES 2000 2001 - ------------------- ------- ------ Legal, Accounting & Consulting $ 3,525 -- Data Processing Write-Offs and Charges 1,400 2,935 Change of Control, Retention & Other 2,975 465 Recognition of Loss on Sale of Securities 12,400 -- Total Charges $20,300 $ 3,400
13 16 EARNINGS ACCRETIVE (Dollars in 000's, except per share amounts)
PROJECTED --------- NET INCOME (AFTER TAX ESTIMATES) 2000 2001 - -------------------------------- ------- ------ BancorpSouth Stand-alone (1) $ 83,000 $ 90,400 First United (1) 38,000 41,200 -------- -------- Pro Forma Combined Income $121,000 $131,600 Net Cost Savings 860 3,900 Increased Spread on AFS Securities (2) 2,200 2,200 Shift from HTM Securities to Loans(3) 850 1,700 Other Fee Income 600 1,100 -------- -------- Pro Forma Operating Income $125,510 $140,500 -------- -------- Operating EPS Stand-alone (1) $ 1.45 $ 1.58 Operating EPS Pro Forma (4) 1.46 1.64 % Accretion/(Dilution) 0.9% 3.8%
(1) Based on IBES estimates as of April 14, 2000 for both BancorpSouth and First United; 2002 earnings based on IBES long-term growth rate of 9.0% for BancorpSouth and 8.6% for First United (2) Assumes $600 million of First United AFS securities portfolio is sold and redeployed at a 60 bps pre-tax gain in yield (3) Assumes gradual shift from HTM portfolio to loans totaling $240 million by end of year 2002 at a 160 bps pre-tax gain in yield (4) Based on a pro forma fully diluted average shares outstanding of 86.0 million 14 17 HISTORY OF SUCCESSFUL MERGER INTEGRATION AND CUSTOMER RETENTION ================================================================================
Current / Current / Beginning Beginning Deposits(1) Deposits(1) 1998 1995 - ---- ---- HomeBanc Corp. AL Wes-Tenn Bancorp TN The First Corp. AL Shelby Bank TN 111.8% Alabama Bancorp AL 105.6% First Federal Bank MS Merchants Capital MS 1994 ---- 1997 LF Bancorp MS - ---- Iuka Guaranty Bank MS 98.2% 1992 Volunteer Bancshares TN
In 1997, BancorpSouth successfully completed a charter consolidation process (1) From announcement date to present 15 18 AN EXCITING OPPORTUNITY ================================================================================ - Entry into Attractive New Markets - Leveraging First United's Branch Network - Strong Management Additions - Fairly Priced Transaction - Financially Attractive - History of Successful Merger Integration and Customer Retention EXCITING OPPORTUNITY FOR BANCORPSOUTH AND FIRST UNITED SHAREHOLDERS 16 19 APPENDIX SUPPLEMENT FINANCIAL INFORMATION 20 PRO FORMA BALANCE SHEET (Dollars in millions; data at Decembert 31, 1999)
BXS UNTD PRO FORMA Cash & Equivalents $ 223 $ 118 $ 341 Securities 1,186 976 2,162 Gross Loans 4,054 1,488 5,542 Allowance for Loan Losses (56) (19) (74) Intangibles & Other Assets 370 102 471 Total Assets $ 5,777 $ 2,666 $ 8,443 Deposits $ 4,815 $ 2,252 $ 7,067 Other Liabilities 464 155 619 Total Equity 497 260 757 Total Liabilities & Equity $ 5,777 $ 2,666 $ 8,443 KEY RATIOS: Tier 1 Capital 11.49% 15.81% 12.70 Total Capital 12.80 15.92 13.67 Tangible Common 8.40 9.20 8.65 Tier 1 Leverage 8.34 9.67 8.76
18 21 PRO FORMA INCOME STATEMENT (Dollars in millions; for the year ended December 31, 1999; no cost savings assumed)
BXS UNTD PRO FORMA ----- ----- --------- Net interest income after provision $ 203 $ 102 $ 305 Non-interest income 79 20 99 ----- ----- ----- Total revenue (1) 282 122 404 Non-interest expense (178) (68) (245) Other expense (5) (1) (6) ----- ----- ----- Pre-tax income 99 52 151 Tax Expense (30) (19) (49) ----- ----- ----- Net income $ 69 $ 33 $ 102 ===== ===== ===== Key Ratios: ROAA 1.26% 1.29% 1.26% ROACE 14.7 12.7 13.9 Net interest margin 4.28 4.39 4.32 Efficiency ratio 60.7 54.6 58.9 Non-interest income/revenue 25.7 15.6 22.7
(1) Net of provision for loan losses 19 22 PRO FORMA LOAN & DEPOSIT COMPOSITION
------------------ ------------------ ------------------ BXS UNTD PRO FORMA ------------ -------------- ------------- $ % $ % $ % ------------------ ------------------ ------------------ GROSS LOANS Commercial & Agriculture $ 371 9.0% $ 341 22.9% $ 712 12.7% Commercial Real Estate 1,408 34.1 492 32.9 1,900 33.8 Consumer & Installment 978 23.7 219 14.7 1,197 21.3 Residential Real Estate 1,043 25.3 437 29.3 1,480 26.3 Lease Financing & Other 331 8.0 4 0.3 335 6.0 DEPOSITS Demand: Interest Bearing $1,075 22.3% $ 485 21.5% $1,560 22.1% Non-Interest Bearing 615 12.8 352 15.6 967 13.7 Savings 800 16.6 138 6.1 938 13.3 Time Deposit 2,326 48.3 1,277 56.7 3,603 51.0
N.B. Financial data as of December 31, 1999 20 23 PRO FORMA ASSET QUALITY (Dollars in thousands; financial data at December 31, 1999)
BXS UNTD PRO FORMA ------- ------- --------- Non-accrual loans $ 5,150 $ 8,202 $13,352 Restructured loans 91 1,034 1,125 Loans 90+ days past due 14,378 2,933 17,311 ------- ------- ------- Non-performing loans 19,619 12,169 31,788 Other real estate owned 7,764 3,418 11,182 ------- ------- ------- Non-performing assets $27,383 $15,587 $42,970 ======= ======= ======= KEY RATIOS: Non-performing loans / loans 0.48% 0.82% 0.57% Non-performing assets / assets 0.47 0.58 0.51 Allowance / NPL's 2.84x 1.54x 2.34x Allowance / NPA's 2.03 1.20 1.73
N.B. Financial data as of December 31, 1999 21 24 FIRST UNITED HISTORICAL FINANCIALS
1997 1998 1999 CAGR ---------- ---------- ---------- ----- Income Statement: Net interest income $ 90.7 $ 94.4 $ 104.9 7.6% Provision for losses 5.2 3.2 3.1 NM Non-interest income (1) 18.1 17.8 19.4 3.7 Non-interest expense 68.0 65.3 67.9 NM Net income $ 25.8 $ 30.3 $ 33.5 13.9% Balance Sheet: Total assets $ 2,355.3 $ 2,516.5 $ 2,666.0 6.4% Loans(2) 1,213.3 1,353.2 1,488.4 10.8 Deposits 1,990.2 2,134.0 2,251.6 6.4 Shareholders' equity 234.5 255.6 259.7 5.2
(1) Excludes securities gains (2) Net of unearned income 22 25 BANCORP SOUTH Q1 2000 INCOME STATEMENT
------------- ------------- --------------- THREE MONTHS THREE MONTHS ENDED 3/31/00 ENDED 3/31/99 PERCENT CHANGE ------------- ------------- --------------- Net interest income after provision $ 52.4 $ 49.3 6.3% Non-interest income 21.5 20.1 7.0 -------- -------- Total revenue (1) 73.9 69.4 6.5 Non-interest expense (46.6) (46.9) 0.6 -------- -------- Pre-tax income 27.3 22.5 21.3 Tax expense (9.2) (6.2) (48.4) -------- -------- Net income $ 18.2 $ 16.3 11.7 ======== ======== Diluted EPS $ 0.32 $ 0.29 10.3 KEY RATIOS: ROAA (2) 1.25% 1.25% ROACE (2) 14.7 14.4 Net interest margin (2) 4.21 4.29 Efficiency ratio 60.3 64.7 Non-interest income/revenue (1) 29.1 29.0
(1) Net of provision for loan losses (2) Annualized 23 26 FIRST UNITED Q1 2000 INCOME STATEMENT
------------- ------------- --------------- THREE MONTHS THREE MONTHS ENDED 3/31/00 ENDED 3/31/99 PERCENT CHANGE ------------- ------------- --------------- Net interest income after provision $ 24.5 $ 23.6 3.8% Non-interest income 5.0 4.8 4.2 -------- -------- Total revenue (1) 29.5 28.4 3.9 Non-interest expense (17.6) (16.7) (5.4) -------- -------- Pre-tax income 11.9 11.7 1.7 Tax expense (3.4) (3.6) 5.6 -------- -------- Net income $ 8.5 $ 8.1 4.9 ======== ======== Diluted EPS $ 0.34 $ 0.32 6.3 KEY RATIOS: ROAA (2 1.30% 1.29% ROACE (2) 13.0 12.7 Net interest margin (2) 4.32 4.40 Efficiency ratio 57.1 57.3 Non-interest income/revenue (1) 20.4 16.9
(1) Net of provision for loan losses (2) Annualized 24 -----END PRIVACY-ENHANCED MESSAGE-----