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assets11 worth a fair market value of $18.1 million by the time
the option was exercisable.
The final merger agreement between Agri and FABG was
executed on September 30, 1994. Under the terms of the merger,
Agri's minority shareholders were offered the option to either
redeem their Agri common stock for book value ($53.55) or
exchange their Agri common stock for FABG common stock at a ratio
reflecting the banks' respective book values (1.0 Agri share for
0.73597 share of FABG).
In its submission to the Federal Reserve Board concerning
the merger, FABG disclosed its obligation pursuant to the 1991
Agreement to pay decedent the same per-share consideration for
her minority interest as that offered to Mr. Hill.
The conservator exchanged decedent's Agri common stock at
the offered ratio for 6,657 shares of FABG common stock12 on
October 1, 1994, and negotiated an agreement (1994 Agreement) for
the postdeath sale of decedent's FABG stock to FABG for 1.25
times book value, or $118.23 per share plus 6 percent compounded
annually until decedent's date of death ($118 price). The 1994
11 Qualified assets were defined generally as cash, notes
receivable, and other investment assets.
12 In connection with the merger, FABG also redeemed all
outstanding shares of Agri preferred stock (including decedent's)
for par plus unpaid dividends through the date of the merger.
The conservator deposited the proceeds from this preferred stock
redemption into segregated accounts.
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