First Citizens Bancshares Inc 8-K, filed Jan 4, 2022
First Citizens Bancshares Inc (FCNCA)
8-K
2022-01-04
For: 2022-01-03
View Original
Added on
April 10, 2026
About this 8-K
First Citizens Bancshares Inc filed this 8-K on January 4, 2022, reporting on events of January 3, 2022.
Items reported
- Item 2.01: Completed an acquisition or sale of assets
- Item 2.03: New debt or off-balance-sheet obligation
- Item 3.03: Change to shareholders' rights
- Item 5.02: Director or officer change, or executive pay
- Item 8.01: Other events
- Item 9.01: Financial statements and exhibits
UNITED STATES
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): January 4, 2022 (January 3, 2022 )
(Exact name of registrant as specified in its charter)
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(State or other jurisdiction
of incorporation)
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(Commission File Number)
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(IRS Employer Identification No.)
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(Address of principal executive offices)
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(Zip Code)
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Registrant’s telephone number, including area code: (919 ) 716-7000
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Securities Registered Pursuant to Section 12(b) of the Securities Exchange Act of 1934:
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Title of each class
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Trading Symbol
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Name of each exchange on which registered
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of
the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised
financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 2.01. |
Completion of Acquisition or Disposition of Assets.
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On January 3, 2022, First Citizens BancShares, Inc. (“First Citizens”) completed its previously announced merger (the “Merger”) with CIT Group Inc., a
Delaware corporation (“CIT”), pursuant to an Agreement and Plan of Merger, dated as of October 15, 2020, as amended by Amendment No. 1, dated as of September 30, 2021 (as amended, the “Merger Agreement”), by and
among First Citizens, First-Citizens Bank & Trust Company (“FCB”), FC Merger Subsidiary IX, Inc., a direct, wholly owned subsidiary of FCB (“Merger Sub”), and CIT, the parent company of CIT Bank, N.A., a national banking association (“CIT
Bank”). Pursuant to the Merger Agreement, on the closing date, Merger Sub merged with and into CIT, with CIT as the surviving entity (the “First-Step Merger”), and immediately following the effective time of the First-Step Merger (the “Effective
Time”), CIT merged with and into FCB, with FCB as the surviving entity (the “Second-Step Merger” and together with the First-Step Merger, the “Mergers”). Immediately following the consummation of the Mergers, CIT Bank merged with and into FCB, with
FCB as the surviving bank (together with the Mergers, the “Transaction”).
Under the terms of the Merger Agreement, at the Effective Time, each share of CIT common stock, par value $0.01 per share (“CIT
Common Stock”), issued and outstanding as of immediately prior to the Effective Time, except for certain shares of CIT Common Stock owned by CIT or First Citizens, was converted into the right to receive 0.06200 shares (the “Exchange Ratio” and such
shares, the “Merger Consideration”) of First Citizens Class A Common Stock, par value $1.00 per share (“First Citizens Common Stock”), plus, if applicable, cash in lieu of fractional shares of First Citizens Common Stock.
At the Effective Time, each issued and outstanding share of fixed-to-floating rate non-cumulative perpetual preferred stock,
series A, par value $0.01 per share, of CIT (“CIT Series A Preferred Stock”) and 5.625% non-cumulative perpetual preferred stock, series B, par value $0.01 per share, of CIT (“CIT Series B Preferred Stock”), automatically converted into the right to
receive one share of a newly created series of preferred stock, series B, of First Citizens (“First Citizens Series B Preferred Stock”) and one share of a newly created series of preferred stock, series C, of First Citizens (“First Citizens Series C
Preferred Stock” and together with the First Citizens Series B Preferred Stock, the “New First Citizens Preferred Stock”), respectively, having such rights, preferences, privileges and voting powers, and limitations and restrictions, taken as a
whole, that are not materially less favorable to the holders thereof than the rights, preferences, privileges and voting powers, and limitations and restrictions, taken as a whole, of the CIT Series A Preferred Stock and the CIT Series B Preferred
Stock, respectively. The non-callable period for the New First Citizens Preferred Stock was extended for five years to January 4, 2027.
Pursuant to the terms of the Merger Agreement, at the Effective Time, (i) each restricted stock unit award or performance stock
unit award in respect of shares of CIT Common Stock, including any deferred restricted stock unit award (each, a “CIT Award”) outstanding prior to the Effective Time, other than a CIT Director RSU Award (defined below), automatically converted into a
restricted stock unit in respect of a number of shares of First Citizens Common Stock (a “First Citizens Award”) equal to (a) the number of shares of CIT Common Stock subject to such CIT Award immediately prior to the Effective Time based on target
level performance multiplied by (b) the Exchange Ratio, subject to the same terms and conditions applicable to the existing CIT Award (except, in the case of performance stock unit awards, for any performance goals or metrics), and (ii) each
restricted stock unit award in respect of shares of CIT Common Stock that (a) was outstanding and unvested immediately prior to the Effective Time, (b) was held by a member of the Board of Directors of CIT, (c) automatically vested upon the Effective
Time in accordance with its terms, and (d) was not subject to a deferral election (each, a “CIT Director RSU Award”) automatically converted into the right to receive the Merger Consideration.
The foregoing description of the Transaction and the Merger Agreement does not purport to be complete and is qualified in its
entirety by reference to the full text of the Merger Agreement, which is filed as Exhibit 2.1 to this Current Report on Form 8-K (this “Current Report”) and is incorporated herein by reference.
| Item 2.03. |
Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of Registrant
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In connection with the Transaction, on January 4, 2022, FCB assumed, through merger and the execution of instruments of assumption, the following indentures and securities issued thereunder:
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$1,250,000,000 5.000% Senior Unsecured Notes due 2022
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Indenture
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Indenture (Senior Debt Securities), dated as of March 15, 2012, as amended, among CIT, as issuer, Wilmington Trust, National Association, as trustee, and Deutsche Bank Trust Company
Americas, as paying agent, security registrar and authenticating agent (the “2012 Senior Indenture”)
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Maturity
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August 15, 2022
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Interest
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5.000% per annum paid semiannually on February 15 and August 15 of each year
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Principal Balance as of December 31, 2021
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$1,147,000,000.00
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$750,000,000 5.000% Senior Unsecured Notes due 2023
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Indenture
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2012 Senior Indenture
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Maturity
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August 1, 2023
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Interest
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5.000% per annum paid semiannually on February 1 and August 1 of each year
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Principal Balance as of December 31, 2021
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$750,000,000.00
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$500,000,000 4.750% Senior Unsecured Notes due 2024
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Indenture
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2012 Senior Indenture
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Maturity
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February 16, 2024
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Interest
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4.750% per annum paid semiannually on February 16 and August 16 of
each year
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Principal Balance as of December 31, 2021
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$500,000,000.00
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$500,000,000 3.929% Senior Unsecured Fixed-to-Floating Rate Notes due 2024
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Indenture
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2012 Senior Indenture
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Maturity
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June 19, 2024
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Interest
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3.929% per annum paid semiannually on June 19 and December 19 of
each year during the fixed rate period, and a variable rate per annum paid quarterly on September 19, 2023, December 19, 2023, March 19, 2024 and June 19, 2024 during the floating rate period
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Principal Balance as of December 31, 2021
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$500,000,000.00
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$500,000,000 5.250% Senior Unsecured Notes due 2025
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Indenture
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2012 Senior Indenture
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Maturity
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March 7, 2025
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Interest
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5.250% per annum paid semiannually on March 9 and September 9 of
each year
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Principal Balance as of December 31, 2021
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$500,000,000.00
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$550,000,000 2.969% Senior Unsecured Fixed-to-Floating Notes due 2025
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Indenture
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Issuing and Paying Agency Agreement, dated as of September 23, 2019, between CIT Bank, as issuer, and Deutsche Bank Trust Company Americas, as issuing and paying agent, transfer agent and registrar
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Maturity
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September 27, 2025
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Interest
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2.926% per annum paid semiannually on March 27 and September 27 of
each year during the fixed rate period, and a variable rate per annum paid quarterly on December 27, 2024, March 27, 2025, June 27, 2025, and September 27, 2025 during the floating rate period
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Principal Balance as of December 31, 2021
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$315,249,000.00
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$500,000,000 6.000% Senior Notes due 2036
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Indenture
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Indenture (Senior Debt Securities), dated as of January 20, 2006, as amended, between CIT, as issuer, and The Bank of New York Mellon, as trustee
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Maturity
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April 1, 2036
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Interest
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6.000% per annum paid semiannually on April 1 and October 1 of each year
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Principal Balance as of December 31, 2021
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$51,353,000.00
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$400,000,000 6.125% Subordinated Notes due 2028
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Indenture
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Indenture (Subordinated Debt Securities), dated as of March 9, 2018, as amended, among CIT, as issuer, Wilmington Trust, National Association, as trustee, and Deutsche Bank Trust Company
Americas, as paying agent, security registrar and authenticating agent (the “2018 Subordinated Indenture”)
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Maturity
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March 9, 2028
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Interest
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6.125% per annum paid semiannually on March 9 and September 9 of
each year
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Principal Balance as of December 31, 2021
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$400,000,000.00
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$100,000,000 4.125% Fixed-to-Fixed Rate Subordinated Notes due 2029
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Indenture
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2018 Subordinated Indenture
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Maturity
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November 13, 2029
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Interest
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4.125% per annum prior to the reset date, and thereafter a fixed
rate determined by reference to the five-year U.S. Treasury rate as of the reset determination date, paid semiannually on May 13 and November 13 of each year
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Principal Balance as of December 31, 2021
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$100,000,000.00
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The descriptions set forth above of each of the debt securities and of FCB’s obligations thereunder are qualified in their entirety by reference to
the applicable indenture and related indenture documents.
The instruments of assumption pursuant to which FCB assumed the above financial obligations, as well as the indentures, credit agreement and related
documents pursuant to which such financial obligations were originally issued, have not been filed herewith pursuant to Item 601(b)(4)(v) of Regulation S-K under the Securities Act. First Citizens agrees to furnish a copy of such documents to the
Securities and Exchange Commission upon request.
| Item 3.03. |
Material Modifications to Rights of Security Holders.
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On January 3, 2022, in connection with the consummation of the Transaction, First Citizens filed two certificates of designation
with the Secretary of State of the State of Delaware to fix the designations, preferences, limitations and relative rights of each series of the New First Citizens Preferred Stock.
The description of the New First Citizens Preferred Stock under the section of the joint proxy statement/prospectus contained in
the Registration Statement on Form S-4 (File No. 333-250131) filed by First Citizens with the Securities and Exchange Commission (the “Commission”) on November 16, 2020, as amended December 21, 2020 (as so amended, the “Joint Proxy
Statement/Prospectus”) entitled “Description of New First Citizens Preferred Stock” is incorporated herein by reference. The description of the terms of the New First Citizens Preferred Stock in the Joint
Proxy Statement/Prospectus is qualified in its entirety by reference to the full text of the certificates of designation, which are filed hereto as Exhibits 4.1 and Exhibit 4.2 and incorporated by reference herein.
| Item 5.02. |
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
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EXECUTIVE OFFICERS
Vice
Chairwoman of the Board. At the Effective Time, pursuant to the terms of the Merger Agreement, Ellen R. Alemany, the former Chairwoman and Chief Executive
Officer of CIT, was appointed as the Vice Chairwoman of First Citizens and FCB. As previously described in the Joint Proxy Statement/Prospectus, Ms. Alemany entered into a letter agreement with First Citizens setting forth the terms of her
employment with First Citizens following the consummation of the Transaction. For a description of Ms. Alemany’s letter agreement and additional information about the arrangements and transactions with respect to Ms. Alemany, please see the section
in the Joint Proxy Statement/Prospectus entitled “Interests of CIT’s Directors and Executive Officers in the Mergers”. Such description is incorporated herein by reference. As of the date of this Current Report, Ms. Alemany owned 18,807 shares of First Citizens Common Stock, 30,000 shares of First Citizens Series C Preferred Stock and held restricted stock units (“RSUs”)
representing the right to receive a total of 20,080 shares of First Citizens Common Stock, as described below. For more information regarding these RSUs, see Item 8.01 of that certain CIT Current Report on Form 8-K dated the date hereof, and which is
incorporated herein by reference.
Immediately prior to the Effective Time of the
First-Step Merger, Ms. Alemany held RSUs representing the right to receive a total of 274,351 shares of CIT Common Stock, of which 52,927 shares were scheduled to vest on March 1, 2022, 36,597 shares were scheduled to vest on March 1, 2023, 76,858
shares were scheduled to vest on March 1, 2024 and 107,968 shares were scheduled to vest on the earlier of (1) December 17, 2024 and (2) the second anniversary of the closing of the Mergers, subject to a performance-based vesting hurdle and Ms.
Alemany’s continued employment with CIT up to and including each vesting date. At the Effective Time, the RSUs converted into the right to receive 17,012 shares of First Citizens Common Stock using the same Exchange Ratio applied to shares of CIT in the First-Step Merger (rounded up to the nearest whole share). The terms and conditions that apply to vesting, settlement, rights to
dividend equivalents, etc. will continue to apply; provided, however, that if she experiences an eligible termination of employment or retirement her RSUs will vest in full.
Immediately prior to the Effective Time of the
First-Step Merger, Ms. Alemany also held performance share units (“PSUs”) representing the right to receive a target of 49,476 shares if CIT achieves certain applicable performance targets for the 2020-2022 performance period, subject to Ms.
Alemany’s continued employment with CIT up to and including the conclusion of the applicable performance period. Pursuant to the terms of the underlying award agreements, performance targets are considered to have been achieved at 100% of target
in the event of a change in control of CIT. Therefore, at the Effective Time, the PSUs converted into RSUs representing the right to receive 3,068 shares of First Citizens Common Stock using the same Exchange Ratio being applied to shares of CIT in the First-Step Merger (rounding up to the nearest whole share). The terms and conditions that apply to vesting, settlement, rights to
dividend equivalents, etc. will continue to apply; provided, however, that if she experiences an eligible termination of employment or retirement these RSUs will vest in full.
The terms of the underlying award agreements provide that, in the discretion of the committee that administers the plan under
which the awards were granted, in lieu of the delivery of shares, the awards and any dividend equivalents payable in shares may be settled in cash.
Chief Credit
Officer. At the Effective Time, Marisa J. Harney, the former Chief Credit Officer of CIT, was appointed as the Chief Credit Officer of FCB. In connection
with entering into the Merger Agreement, FCB entered into a letter agreement with Ms. Harney with respect to the terms of Ms. Harney’s employment with and service to FCB following the consummation of the Transaction. Ms. Harney will receive an
annual base salary no less than that in effect immediately prior to the consummation of the Mergers (currently $500,000). In addition, Ms.
Harney is eligible for incentive compensation opportunities commensurate with those provided to other senior executives of FCB, except that her short term incentive payout for 2021 (which will be paid in 2022) will be no less than 85 percent of
target. As an incentive for her to remain employed with FCB, Ms. Harney is eligible to receive a retention bonus that will vest in full and become non-forfeitable upon the second anniversary of the closing date of the Mergers, unless prior to
that date she incurs an eligible termination or retirement, each as defined in the letter agreement. The amount of her retention bonus will be $2,336,500. The retention bonus will be paid in a lump sum upon separation from service, conditioned
upon the execution of a release of all claims. Ms. Harney is also entitled to a special bonus of $500,000, which will, subject to continued employment, be paid 50 percent on the first anniversary of the closing date of the Mergers and 50 percent
on the second anniversary of the closing date of the Mergers, unless prior to those dates she incurs an eligible termination, in which case she will immediately receive any unpaid portion of the special bonus. Ms. Harney will remain subject to
the terms of her existing restrictive covenant agreements with CIT. As of the date of this Current Report, Ms. Harney owned 475 shares of First Citizens Common Stock and held RSUs representing the right to receive a total of 1,341 shares of First
Citizens Common Stock, as described below.
Immediately prior to the Effective Time of the First-Step Merger, Ms. Harney held RSUs representing the right to receive a total
of 16,638 shares of CIT Common Stock, of which 5,293 shares were scheduled to vest on March 1, 2022, 3,660 shares were scheduled to vest on March 1, 2023, and 7,686 shares were scheduled to vest on March 1, 2024, subject to a performance-based
vesting hurdle and Ms. Harney’s continued employment with CIT up to and including each vesting date. At the Effective Time, the RSUs converted into the right to receive 1,034 shares of First Citizens Common Stock using the same Exchange Ratio applied
to shares of CIT in the First-Step Merger (rounded up to the nearest whole share). The terms and conditions that apply to vesting, settlement, rights to dividend equivalents, etc. will continue to apply; provided, however, that if she experiences an
eligible termination of employment or retirement her RSUs will vest in full.
Immediately prior to the Effective Time of the
First-Step Merger, Ms. Harney also held PSUs representing the right to receive a target of 4,948 shares if CIT achieves certain applicable performance targets for the 2020-2022 performance period, subject to Ms. Harney’s continued employment with
CIT up to and including the conclusion of the applicable performance period. Pursuant to the terms of the underlying award agreements, performance targets are considered to have been achieved at 100% of target in the event of a change in control
of CIT. Therefore, at the Effective Time, the PSUs converted into RSUs representing the right to receive 307 shares of First Citizens Common
Stock using the same Exchange Ratio being applied to shares of CIT in the First-Step Merger (rounding up to the nearest whole share). The terms and conditions that apply to vesting, settlement, rights to dividend equivalents, etc. will continue
to apply; provided, however, that if she experiences an eligible termination of employment or retirement these RSUs will vest in full.
The terms of the underlying award agreements provide that, in the discretion of the committee that administers the plan under
which the awards were granted, in lieu of the delivery of shares, the awards and any dividend equivalents payable in shares may be settled in cash.
First Citizens Executive Compensation Programs
Ms. Alemany and Ms. Harney will be eligible to participate in all of First Citizen’s executive-level compensatory programs.
Additional information concerning First Citizens’ compensatory plans and programs for executive officers is provided in the sections of First Citizens’ definitive proxy statement for the 2021 annual meeting of shareholders (the “2021 Annual Proxy
Statement”) captioned “Compensation Discussion and Analysis,” “Executive Compensation” and “Post-Employment Compensation”, which are incorporated herein by reference.
First Citizens Executive Officers after the Transaction
Following the Effective Time, the executive officers of First Citizens were as follows:
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Name
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Executive Position
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Frank B. Holding, Jr.
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Chairman and Chief Executive Officer
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Hope H. Bryant
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Vice Chairwoman
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Ellen R. Alemany
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Vice Chairwoman
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Peter M. Bristow
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President
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Craig L. Nix
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Chief Financial Officer
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Marisa J. Harney
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Chief Credit Officer
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Lorie K. Rupp
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Chief Risk Officer
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Jeffery L. Ward
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Chief Strategy Officer
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Matthew G.T. Martin
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Chief Counsel and Corporate Secretary
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DIRECTORS
Election of New Directors.
At the Effective Time, as previously disclosed in the 2021 Annual Proxy Statement and in accordance with the Merger Agreement,
the following individuals, each of whom was a member of the Board of Directors of CIT immediately prior to the consummation of the Transaction, were elected to the First Citizens Board of Directors: (i) Ellen R. Alemany, (ii) Michael A. Carpenter,
and (iii) Vice Admiral John R. Ryan, USN (Ret) (collectively, the “New Directors”).
Other than the Merger Agreement, and in the case of Ms. Alemany, her letter agreement, there are no arrangements between the New
Directors and any other person pursuant to which the New Directors were selected as directors. There are no transactions in which any New Director has an interest requiring disclosure under Item 404(a) of Regulation S-K.
Biographical & Other Information.
Biographical and other information related to the New Directors and Ms. Harney is provided in the 2021 Annual Proxy Statement
under the caption “Proposed New Directors and Executive Officers”, which information is incorporated herein by reference. Based on its review and application of the independence criteria contained in the
listing requirements of The NASDAQ Stock Market (“Nasdaq”), the First Citizens’ Board of Directors has determined that each of Mr. Carpenter and Vice Admiral Ryan is independent under applicable Nasdaq listing standards.
Board Committee Assignments after the Merger.
Following the Effective Time, the major committees of the Board of Directors of First Citizens will be comprised of the following
members:
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Audit Committee: The audit committee is chaired by H. Lee Durham, Jr. and also includes John M. Alexander, Jr., Michael A. Carpenter, Daniel L. Heavner and Floyd L. Keels.
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Risk Committee: The risk committee is chaired by Robert R. Hoppe and also includes Victor E. Bell III, Robert E. Mason IV and Vice Admiral John R. Ryan, USN (Ret).
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Compensation, Nominations and Governance Committee (the “CNGC Committee”): The CNGC Committee is chaired by Robert T. Newcomb and also includes Victor E. Bell III, H. Lee Durham, Jr. and Robert E. Mason IV.
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Stock Ownership of New Directors
Michael A.
Carpenter. Immediately prior to the Effective Time of the First-Step Merger, Mr. Carpenter held RSUs representing the right to receive a total of 20,760 shares of CIT Common Stock. Pursuant to the terms of the underlying award agreements, these RSUs vested in full on the Effective Date of the
First-Step Merger. Mr. Carpenter previously elected to have settlement of these awards deferred until he is no longer a director. In addition, Mr. Carpenter previously deferred settlement of 14,983
fully-vested RSUs granted to him in 2011-2014 until he is no longer a director. Therefore, in connection with the Transaction, a total of 35,744 RSUs were converted into the right to receive First
Citizens Common Stock and settled following closing. As of the date of this Current Report, Mr. Carpenter owned 2,215 shares of First Citizens Common Stock.
Vice Admiral
John R. Ryan (USN (Ret.). Immediately prior to the Effective Time of the First-Step Merger, Vice Admiral Ryan held RSUs representing the right to receive a
total of 9,997 shares of CIT Common Stock and additional RSUs representing the right to receive the value of 1,622 shares of CIT Common Stock in cash. Pursuant to the terms of the underlying award agreements, these RSUs vested in full on the Effective Time of the First-Step Merger. The cash-settled RSUs were settled in cash equal to the value
of $813.02 per RSU following closing. Vice Admiral Ryan previously elected to have settlement of these stock-settled awards deferred
until he is no longer a director. In addition, Vice Admiral Ryan previously deferred settlement of 20,206 fully-vested RSUs granted to him in 2011-2014 until he is no longer a director. Therefore, in
connection with the Transaction, a total of 30,203 RSUs were converted into the right to receive First Citizens Common Stock and settled following closing. As
of the date of this Current Report, Vice Admiral Ryan owned 1,871 shares of First Citizens Common Stock.
Director Compensation.
Each New Director (other than Ms. Alemany who will be compensated as an executive officer) will be compensated in accordance with the 2021 standard
schedule of fees under which compensation is paid to non-employee directors included in the 2021 Annual Proxy Statement under the caption “2020 Director Compensation”, which is incorporated herein by
reference. The New Directors will be paid the annual retainer of $200,000, prorated based on the number of days remaining in their terms prior to the 2022 Annual Meeting.
| Item 8.01. |
Other Events
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On January 4, 2022, First Citizens issued a press release announcing the completion of the Transaction. A copy of the press release is attached hereto
as Exhibit 99.1 and is incorporated by reference herein.
| Item 9.01. |
Financial Statements and Exhibits
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(a) Financial statement of business acquired
The financial statements of CIT required by Item 9.01(a) of Form 8-K will be filed by amendment no later than 71 calendar days after the date this
Current Report is required to be filed.
(b) Pro forma financial information
The pro forma financial information required by Item 9.01(b) of Form 8-K will be filed by amendment no later than 71 calendar days after the date of
this Current Report is required to be filed.
(d) Exhibits. The following exhibit accompanies this
Current Report.
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Exhibit No.
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Description
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Agreement and Plan of Merger, dated as of October 15, 2020, by and among First Citizens BancShares, Inc., First-Citizens Bank & Trust Company, FC Merger Subsidiary IX, Inc., and CIT Group Inc. (incorporated by
reference to Exhibit 2.1 to First Citizens’ current report on Form 8-K filed on October 20, 2020)
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Amendment No. 1, dated September 30, 2021, to the Agreement and Plan of Merger dated October 15, 2020 (incorporated by reference to Exhibit 2.1 to First Citizens’ current report on Form 8-K filed on September 30,
2021)
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Certificate of Designation of Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series B
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Certificate of Designation of 5.625% Non-Cumulative Perpetual Preferred Stock, Series C
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Press Release of First Citizens BancShares, Inc., dated January 4, 2022
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104
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Cover Page Interactive Data File (embedded within the Inline XBRL document)
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned
hereunto duly authorized.
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First Citizens BancShares, Inc.
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(Registrant)
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Date:
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January 4, 2022
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By: /s/ Craig L. Nix
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Craig L. Nix
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Chief Financial Officer
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Exhibit 4.1
CERTIFICATE OF DESIGNATION
OF
FIXED-TO-FLOATING RATE NON-CUMULATIVE
PERPETUAL PREFERRED STOCK, SERIES B
OF
FIRST CITIZENS BANCSHARES, INC.
First Citizens BancShares, Inc., a
corporation organized and existing under the laws of the State of Delaware (the “Corporation”), in accordance with Section 151 of the General Corporation Law of the State of Delaware, does hereby certify:
The Board of Directors of the Corporation (the “Board”), in accordance with the Corporation’s Restated Certificate of
Incorporation, as amended, the Corporation’s Amended and Restated Bylaws, as amended, and applicable law, has adopted the following resolution on October 15, 2020, creating a series of Preferred Stock of 325,000 shares from the Corporation’s
authorized Preferred Stock, which series of Preferred Stock is to be designated as “Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series B” (the “Series B Preferred Stock”):
RESOLVED, that pursuant to the
provisions of the Restated Certificate of Incorporation of the Corporation, as amended, the Corporation’s Amended and Restated Bylaws, as amended, and applicable law, a series of Preferred Stock, par value $0.01 per share, of the Corporation be and
hereby is created, and that the number of shares of such series, and the terms, preferences, privileges, designations, rights, qualifications, limitations and restrictions thereof are hereby established as set forth below:
1. Definitions. The following
terms used herein shall be defined as set forth below:
“Appropriate Federal Banking Agency”
means the “appropriate Federal banking agency” with respect to the Corporation as defined in Section 3(q) of the Federal Deposit Insurance Act (12 U.S.C. Section 1813(q)), or any successor provision.
“Business Day” means any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking
institutions are authorized or required by law or regulation to close in The City of New York.
“Bylaws” means the Amended and Restated Bylaws of the Corporation, as they may be amended or restated from time to time.
“Certificate of Incorporation” means the Restated Certificate of Incorporation of the Corporation, as it may be amended or restated from time to time.
“Common Stock” means any and all classes of common stock of the Corporation, including the Class A Common Stock, $1.00 par value
per share, of the Corporation and the Class B Common Stock, $1.00 par value per share of the Corporation.
“Preferred Stock” means any and all series of preferred stock of the Corporation, including the Series A Preferred Stock, the
Series B Preferred Stock and the Series C Preferred Stock.
2. Designation and Number of
Shares. There is hereby created out of the authorized and unissued shares of preferred stock of the Corporation a series of Preferred Stock designated as the “Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series B”
(hereinafter called “Series B Preferred Stock”); the authorized number of shares that shall constitute such series shall be 325,000 shares, $0.01 par value per share; and such shares shall have a liquidation preference of $1,000 per share. The number
of shares constituting the Series B Preferred Stock may be increased from time to time by resolution of the Board or a duly authorized committee of the Board in accordance with the Certificate of Incorporation (as then in effect), the Bylaws (as then
in effect) and applicable law up to the maximum number of shares of Preferred Stock authorized to be issued under the Corporation’s Certificate of Incorporation (as then in effect) less all shares at the time authorized of any other series of
Preferred Stock or decreased from time to time by a resolution of the Board or a duly authorized committee of the Board in accordance with the Certificate of Incorporation (as then in effect), the Bylaws (as then in effect) and applicable law but not
below the number of shares of Series B Preferred Stock then outstanding. Shares of Series B Preferred Stock shall be dated the date of issue, which date shall be referred to herein as the “original issue date.” Shares of outstanding Series B
Preferred Stock that are redeemed, purchased or otherwise acquired by the Corporation shall be cancelled and shall revert to authorized but unissued shares of the Corporation’s Preferred Stock, undesignated as to series.
3. Ranking. The shares of Series B Preferred Stock
shall rank:
(a) senior, as to dividends
and upon liquidation, dissolution and winding-up of the Corporation, to the Common Stock and to any other class or series of capital stock of the Corporation now or hereafter authorized, issued or outstanding that, by its terms, does not expressly
provide that such class or series ranks pari passu with the Series B Preferred Stock or senior to the Series B Preferred Stock as to dividends and upon
liquidation, dissolution and winding-up of the Corporation, as the case may be (collectively, “Series B Junior Securities”);
(b) on a parity, as to dividends and upon liquidation, dissolution and winding-up of the Corporation, with any class or
series of capital stock of the Corporation now or hereafter authorized, issued or outstanding that, by its terms, expressly provides that such class or series ranks pari
passu with the Series B Preferred Stock as to dividends and upon liquidation, dissolution and winding-up of the Corporation, as the case may be, including the Corporation’s currently outstanding 5.375% Non-Cumulative Perpetual Preferred
Stock, Series A, par value $0.01 per share, liquidation preference $1,000 (the “Series A Preferred Stock”) and the 5.625% Non-Cumulative Perpetual Preferred Stock, Series C, par value $0.01 per share, liquidation preference of $25 per share
(collectively, the “Series B Parity Securities”); and
(c) junior, as to dividends and upon liquidation, dissolution and winding-up of the Corporation, to any other class or
series of capital stock of the Corporation now or hereafter authorized, issued or outstanding that, by its terms, expressly provides that such class or series ranks senior to the Series B Preferred Stock as to dividends and upon liquidation,
dissolution and winding-up of the Corporation, as the case may be.
The Corporation may authorize and issue additional shares of Series B Junior Securities and Series B Parity
Securities from time to time without the consent of the holders of the Series B Preferred Stock.
4. Dividends.
(a) Holders of Series B
Preferred Stock will be entitled to receive, only when, as and if declared by the Board or a duly authorized committee of the Board, on each Series B Dividend Payment Date (as defined below), out of assets legally available for the payment of
dividends thereof, non-cumulative cash dividends based on the liquidation preference of the Series B Preferred Stock of $1,000 per share at a rate equal to (i) 5.800% per annum for each Series B Dividend Period (as defined below) from the original
issue date of the Series B Preferred Stock to, but excluding, June 15, 2022 (the “Fixed Rate Period”) and (ii) three-month LIBOR (as defined below) plus a spread of 3.972% per annum, for each Series B Dividend Period beginning on or after June 15,
2022 to, but excluding, the date of redemption (if any) of the Series B Preferred Stock (the “Floating Rate Period”). If the Corporation issues additional shares of the Series B Preferred Stock after the original issue date, dividends on such shares
may accrue from the original issue or any other date specified by the Board or a duly authorized committee of the Board at the time such additional shares are issued.
(b) If declared by the Board or a duly authorized committee of the Board, dividends will be payable on the Series B
Preferred Stock in arrears on June 15, 2022, and thereafter, quarterly in arrears on March 15, June 15, September 15 and December 15 of each year, beginning on September 15, 2022, each such day a “Series B Dividend Payment Date”; provided, however, that (i) if any such Series B Dividend Payment Date on
or before June 15, 2022, is not a Business Day, then such date shall nevertheless be a Series B Dividend Payment Date but dividends on the Series B Preferred Stock shall be paid on the next succeeding Business Day (without any adjustment to the
amount of dividends paid) and (ii) if any such Series B Dividend Payment Date after June 15, 2022, is not a Business Day, then the next succeeding Business Day shall be the applicable Series B Dividend Payment Date relating to such Series B Dividend
Period and dividends shall accrue to and be paid on the next succeeding Business Day.
(c) Dividends will be payable
to holders of record of Series B Preferred Stock as they appear on the Corporation’s stock register on the applicable record date, which shall be the 15th calendar day before the applicable Series B Dividend Payment Date, or such other record date,
not less than 15 calendar days nor more than 30 calendar days before the applicable Series B Dividend Payment Date, as such record date shall be fixed by the Board or a duly authorized committee of the Board.
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(d) A “Series B Dividend Period” is the period from and including a Series B Dividend Payment Date to, but excluding, the
next succeeding Series B Dividend Payment Date, except that the initial Series B Dividend Period will commence on and include the original issue date of Series B Preferred Stock and continue to, but exclude, June 15, 2022. Dividends payable on Series
B Preferred Stock for the Fixed Rate Period will be computed on the basis of a 360-day year consisting of twelve 30-day months. Dividends payable on the Series B Preferred Stock for the Floating Rate Period will be computed by multiplying the per
annum dividend rate in effect for that Floating Rate Period by a fraction, the numerator of which shall be the actual number of days in that Floating Rate Period and the denominator of which shall be 360, and by multiplying the rate obtained by
$1,000 to determine the dividend per share of Series B Preferred Stock. Dollar amounts resulting from that calculation will be rounded to the nearest cent, with one-half cent being rounded upward. Dividends on the Series B Preferred Stock will cease
to accrue on the redemption date, if any, with respect to the Series B Preferred Stock redeemed, unless the Corporation defaults in the payment of the redemption price of the Series B Preferred Stock called for redemption.
The term “three-month LIBOR” means the London interbank offered rate for deposits in U.S. dollars having an index maturity
of three months in amounts of at least $1,000,000, as that rate appears on Reuters screen page “LIBOR01”, or any successor page, at approximately 11:00 a.m., London time, on the relevant dividend determination date. If no offered rate appears on
Reuters screen page “LIBOR01”, or any successor page, on the relevant dividend determination date at approximately 11:00 a.m., London time, then the calculation agent, after consultation with the Corporation, will select four major banks in the London interbank market and will request each of their principal London offices to provide a quotation of the rate at which
three-month deposits in U.S. dollars in amounts of at least $1,000,000 are offered by it to prime banks in the London interbank market, on that date and at that time, that is representative of single transactions at that time. If at least two
quotations are provided, three-month LIBOR will be the arithmetic average (rounded upward, if necessary, to the nearest .00001 of 1%) of the quotations provided. Otherwise, the calculation agent will select three major banks in New York City and will
request each of them to provide a quotation of the rate offered by it at approximately 11:00 a.m., New York City time, on the dividend determination date for loans in U.S. dollars to leading European banks having an index maturity of three months for
the applicable Series B Dividend Period in an amount of at least $1,000,000 that is representative of single transactions at that time. If three quotations are provided, three-month LIBOR will be the arithmetic average (rounded upward, if necessary,
to the nearest .00001 of 1%) of the quotations provided. Otherwise, three-month LIBOR for the next Series B Dividend Period will be equal to three-month LIBOR in effect for the then-current Series B Dividend Period, or, in the case of the first
Series B Dividend Period within the Floating Rate Period, the most recent rate that could have been determined had such Series B Dividend Period commenced prior to the Floating Rate Period.
(e) The dividend rate for each Series B Dividend Period during the Floating Rate Period will be determined by the
calculation agent using three-month LIBOR (as defined above) as in effect on the second London business day immediately preceding the first day of the Series B Dividend Period, which date
is the “dividend determination date” for the applicable Series B Dividend Period. The calculation agent then will add the spread of 3.972% per annum to the three-month LIBOR rate as determined on the dividend determination date. Absent manifest
error, the calculation agent’s determination of the dividend rate, and its calculation of the amount of dividends, for a Series B Dividend Period will be binding and conclusive on holders of Series B Preferred Stock, the transfer agent and the Corporation. A “London business day” is any day that is a Monday, Tuesday, Wednesday, Thursday or Friday and is a day on which dealings in U.S. dollars are transacted in the London interbank
market.
Dividends on the Series B
Preferred Stock will not be cumulative. If the Board or a duly authorized committee of the Board does not declare a dividend, in full or otherwise, on the Series B Preferred Stock in respect of a Series B Dividend Period, then such unpaid dividends
shall cease to accrue and shall not be payable on the applicable Series B Dividend Payment Date or be cumulative, and the Corporation will have no obligation to pay (and the holders of the Series B Preferred Stock shall have no right to receive)
dividends accrued for such Series B Dividend Period after the Series B Dividend Payment Date for such Series B Dividend Period, whether or not the Board or a duly authorized committee of the Board declares a dividend for any future Series B Dividend
Period with respect to the Series B Preferred Stock, the Common Stock, or any other class or series of the Corporation’s Preferred Stock. No interest, or sum of money in lieu of interest shall be payable in respect of any dividend not declared.
(f) Notwithstanding any other
provision hereof, dividends on the Series B Preferred Stock shall not be declared, paid or set aside for payment to the extent such act would cause the Corporation to fail to comply with the laws and regulations applicable to it, including applicable
capital adequacy rules of the Board of Governors of the Federal Reserve System (the “Federal Reserve”) or, as and if applicable, the capital adequacy rules or regulations of any Appropriate Federal Banking Agency.
(g) So long as any share of
Series B Preferred Stock remains outstanding:
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(1) no dividend shall be declared or paid or set aside for
payment, and no distribution shall be declared or made or set aside for payment, on any Series B Junior Securities, other than (i) a dividend payable solely in Series B Junior Securities or (ii) any dividend in connection with the implementation of a
stockholders’ rights plan, or the issuance of rights, stock or other property under any such plan, or the redemption or repurchase of any rights under any such plan;
(2) no shares of Series B Junior Securities shall be
repurchased, redeemed or otherwise acquired for consideration by the Corporation, directly or indirectly, other than (i) as a result of a reclassification of Series B Junior Securities for or into other Series B Junior Securities, (ii) the exchange
or conversion of one share of Series B Junior Securities for or into another share of Series B Junior Securities, (iii) through the use of the proceeds of a substantially contemporaneous sale of other shares of Series B Junior Securities, (iv)
purchases, redemptions or other acquisitions of shares of Series B Junior Securities in connection with any employment contract, benefit plan or other similar arrangement with or for the benefit of employees, officers, directors or consultants, (v)
purchases of shares of Series B Junior Securities pursuant to a contractually binding requirement to buy Series B Junior Securities existing prior to the preceding Series B Dividend Period, including under a contractually binding stock repurchase
plan, or (vi) the purchase of fractional interests in shares of Series B Junior Securities pursuant to the conversion or exchange provisions of such stock or the security being converted or exchanged; nor shall any monies be paid to or made available
for a sinking fund for the redemption of any such securities by the Corporation; and
(3) no shares of Series B Parity Securities shall be repurchased, redeemed or otherwise acquired for consideration by the Corporation, directly or indirectly, other than (i) pursuant to pro rata offers to purchase all, or a pro rata portion, of the Series B Preferred Stock and such Series B Parity Securities,
(ii) as a result of a reclassification of Series B Parity Securities for or into other Series B Parity Securities, (iii) the exchange or conversion of one share of Series B Parity Securities for or into another share of Series B Parity Securities,
(iv) through the use of the proceeds of a substantially contemporaneous sale of other shares of Series B Parity Securities, (v) purchases of shares of Series B Parity Securities pursuant to a contractually binding requirement to buy Series B Parity
Securities existing prior to the preceding Series B Dividend Period, including under a contractually binding stock repurchase plan, or (vi) the purchase of fractional interests in shares of Series B Parity Securities pursuant to the conversion or
exchange provisions of such stock or the security being converted or exchanged; nor shall any monies be paid to or made available for a sinking fund for the redemption of any such securities by the Corporation;
unless, in each case, the full dividends for the most recently completed Series B Dividend Period on all outstanding shares of
Series B Preferred Stock have been declared and paid or declared and a sum sufficient for the payment thereof has been set aside.
(h) Notwithstanding the foregoing, when dividends are not paid in full, or set aside for payment in full, on any dividend payment date, upon the shares of Series B Preferred Stock and any Series B Parity Securities, all dividends declared upon shares of Series B Preferred Stock and any Series B Parity
Securities for such dividend payment date shall be declared on a pro rata basis in proportion to the respective amounts of undeclared and unpaid dividends for the Series B Preferred Stock and all Series B Parity Securities on such dividend payment
date. To the extent a dividend period with respect to any Series B Parity Securities coincides with more than one Series B Dividend Period, for purposes of the immediately preceding sentence the Board shall treat such dividend period as two or more
consecutive dividend periods, none of which coincides with more than one Series B Dividend Period, or shall treat such dividend period(s) with respect to any Series B Parity Securities and Series B Dividend Period(s) for purposes of the immediately
preceding sentence in any other manner that it deems to be fair and equitable in order to achieve ratable payments of dividends on such Series B Parity Securities and the Series B Preferred Stock. To the extent a Series B Dividend Period coincides
with more than one dividend period with respect to any Series B Parity Securities, for purposes of the first sentence of this paragraph the Board shall treat such Series B Dividend Period as two or more consecutive Series B Dividend Periods, none of
which coincides with more than one dividend period with respect to such Series B Parity Securities, or shall treat such Series B Dividend Period(s) and dividend period(s) with respect to any Series B Parity Securities for purposes of the first
sentence of this paragraph in any other manner that it deems to be fair and equitable in order to achieve ratable payments of dividends on the Series B Preferred Stock and such Series B Parity Securities. For the purposes of this paragraph, the term
“dividend period” as used with respect to any Series B Parity Securities means such dividend periods as are provided for in the terms of such Series B Parity Securities.
(i) Subject to the foregoing,
dividends (payable in cash, stock or otherwise), as may be determined by the Board or a duly authorized committee of the Board, may be declared and paid on
the Common Stock and any other class or series of capital stock ranking equally with or junior to Series B Preferred Stock from time to time out of any assets legally available for such payment, and the holders of Series B Preferred Stock shall not
be entitled to participate in any such dividend.
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5. Liquidation.
(a) Upon any voluntary or involuntary
liquidation, dissolution or winding-up of the Corporation, holders of Series B Preferred Stock are entitled to receive out of the assets of the Corporation available for distribution to stockholders, after satisfaction of liabilities and obligations
to creditors, if any, and subject to the rights of holders of any securities then outstanding ranking senior to or on parity with Series B Preferred Stock with respect to distributions of assets, before any distribution or payment out of the assets
of the Corporation is made to holders of Common Stock or any Series B Junior Securities, a liquidating distribution in the amount of the liquidation preference of $1,000 per share plus any declared and unpaid dividends prior to the payment of the
liquidating distribution, without accumulation of any dividends that have not been declared prior to the payment of the liquidating distribution. After payment of the full amount of such liquidating distribution, the holders of Series B Preferred
Stock shall not be entitled to any further participation in any distribution of assets of the Corporation.
(b) In any such liquidating distribution, if the assets of the Corporation are not sufficient to pay the liquidation preferences
(as defined below) in full to all holders of Series B Preferred Stock and all holders of any Series B Parity Securities, the amounts paid to the holders of Series B Preferred Stock and to the holders of all Series B Parity Securities will be paid pro
rata in accordance with the respective aggregate liquidation preferences owed to those holders. In any such distribution, the “liquidation preference” of any holder of Series B Preferred Stock or any Series B Parity Securities means the amount
otherwise payable to such holder in such distribution (assuming no limitation the Corporation’s assets available for such distribution), including any declared but unpaid dividends (and, in the case of any holder of stock other than the Series B
Preferred Stock on which dividends accrue on a cumulative basis, an amount equal to any unpaid, accrued, cumulative dividends, whether or not declared, as applicable). If the liquidation preference has been paid in full to all holders of Series B
Preferred Stock and any Series B Parity Securities, the holders of the Corporation’s Series B Junior Securities shall be entitled to receive all remaining assets of the Corporation according to their respective rights and preferences.
(c) For purposes of this Section 5, neither the sale, conveyance, exchange or transfer of all or substantially all of the assets
or business of the Corporation for cash, securities or other property, nor the merger or consolidation of the Corporation with any other entity, including a
merger or consolidation in which the holders of Series B Preferred Stock receive cash, securities or property for their shares, shall constitute a liquidation, dissolution or winding-up of the Corporation.
6. Redemption.
(a) Series B Preferred Stock is not subject to any mandatory redemption, sinking fund or other similar provisions. Series B Preferred Stock is not redeemable prior to January 4, 2027. On and after that date, shares of Series B Preferred Stock then outstanding will be redeemable at the
option of the Corporation, subject to the approval of the Federal Reserve or any Appropriate Federal Banking Agency, in whole or in part, from time to time, on any Series B Dividend Payment Date, at a redemption price equal to $1,000 per share, plus
any declared and unpaid dividends, without accumulation of any undeclared dividends, to, but excluding, the date of redemption. Holders of Series B Preferred Stock will have no right to require the redemption or repurchase of Series B Preferred
Stock. Notwithstanding the foregoing, within 90 days following the occurrence of a Regulatory Capital Treatment Event (as defined below), the Corporation, at its option, may redeem, at any time, all (but not less than all) of the shares of the Series
B Preferred Stock at the time outstanding, at a redemption price equal to $1,000 per share, plus any declared and unpaid dividends, without accumulation of any undeclared dividends, upon notice given as provided in sub-section (b) below. Any declared
but unpaid dividends payable on a redemption date that occurs subsequent to the record date for a Series B Dividend Period shall not be paid to the holder entitled to receive the redemption price on the redemption date, but rather shall be paid to
the holder of record of the redeemed shares on such record date relating to the Series B Dividend Payment Date as provided in Section 4(c) above. In all cases, the Corporation may not redeem shares of the Series B Preferred Stock without having
received the prior approval of the Federal Reserve or any successor Appropriate Federal Banking Agency if then required under capital rules applicable to the Corporation.
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A “Regulatory Capital Treatment Event” means the good faith determination by the Board or a duly authorized committee of the Board
that, as a result of (i) any amendment to, or change in, the laws, rules or regulations of the United States (including, for the avoidance of doubt, any agency or instrumentality of the United States, including the Federal Reserve and other
appropriate federal bank regulatory agencies) or any political subdivision of or in the United States (including, for the avoidance of doubt, any agency or instrumentality of the United States, including the Federal Reserve and other federal banking
agencies) that is enacted or becomes effective after the initial issuance of any share of the Series B Preferred Stock; (ii) any proposed change in those laws, rules or regulations that is announced after the initial issuance of any share of the
Series B Preferred Stock; or (iii) any official administrative decision or judicial decision or administrative action or other official pronouncement interpreting or applying those laws, rules or regulations or policies with respect thereto that is
announced after the initial issuance of any share of the Series B Preferred Stock, there is more than an insubstantial risk that the Corporation will not be entitled to treat the full liquidation value of $1,000 per share of the Series B Preferred
Stock then outstanding as “Tier 1 Capital” (or its equivalent) for purposes of the capital adequacy rules of the Federal Reserve (or, as and if applicable, the capital adequacy rules or regulations of any successor Appropriate Federal Banking
Agency), as then in effect and applicable, for as long as any share of the Series B Preferred Stock is outstanding.
(b) If shares of Series B Preferred Stock are to be redeemed, the notice of redemption shall be given to the holders of record of
Series B Preferred Stock to be redeemed by first class mail, postage prepaid, addressed to the holders of record of such shares to be redeemed at their respective last addresses appearing on the Corporation’s stock register not less than 30 days nor
more than 60 days prior to the date fixed for redemption thereof (provided that, if the shares of Series B Preferred Stock are held in book-entry form through The Depository Trust Company (“DTC”), the Corporation may give such notice in any manner
permitted by DTC). Each notice of redemption will include a statement setting forth: (i) the redemption date; (ii) the number of shares of Series B Preferred Stock to be redeemed and, if less than all the shares held by such holder are to be redeemed, the number of such shares to be redeemed from such holder; (iii) the redemption price; and (iv) that dividends on the shares to be redeemed will cease to
accrue on the redemption date. If notice of redemption of any shares of Series B Preferred Stock has been duly given and if the funds necessary for such redemption have been set aside by the Corporation for the benefit of the holders of any shares of
Series B Preferred Stock so called for redemption, then, on and after the redemption date, dividends will cease to accrue on such shares of Series B Preferred Stock, such shares of Series B Preferred Stock shall no longer be deemed outstanding and
all rights of the holders of such shares will terminate, except the right to receive the redemption price described in sub-section (a) above, without interest.
(c) In case of any redemption of only part of the shares of Series B Preferred Stock at the time outstanding, the shares to be
redeemed shall be selected (1) pro rata, (2) by lot or (3) in such other manner as the Corporation may determine to be equitable and permitted by DTC and the rules of any national securities exchange on which the Series B Preferred Stock is listed.
7. Voting Rights.
(a) Except as provided below or as expressly required by law, the holders of shares of Series B Preferred Stock shall have no
voting power, and no right to vote on any matter at any time, either as a separate series or class or together with any other series or class of shares of capital stock, and shall not be entitled to call a meeting of such holders for any purpose, nor
shall they be entitled to participate in any meeting of the holders of the Common Stock.
(b) So long as any shares of Series B Preferred Stock remain outstanding, the affirmative vote or consent of the holders of at
least two-thirds of all of the shares of Series B Preferred Stock at the time outstanding, voting separately as a class, shall be required to:
(1) authorize, create or issue, or increase the authorized amount of, shares of any class or series of capital stock ranking
senior to the Series B Preferred Stock with respect to payment of dividends or the distribution of assets upon liquidation, dissolution or winding up of the Corporation, or issue any obligation or security convertible into or exchangeable for or
evidencing the right to purchase, any such class or series of the Corporation’s capital stock;
(2) amend, alter or repeal the provisions of the Corporation’s Certificate of Incorporation (including this
Certificate of Designation), whether by merger, consolidation or otherwise, so as to materially and adversely affect the powers, preferences, privileges or rights of Series B Preferred Stock, taken as a whole; provided, however, that any amendment to
authorize, create or issue, or increase the authorized amount of, any Series B Junior Securities or any Series B Parity Securities, or any securities convertible into or exchangeable for Series B Junior Securities or Series B Parity Securities, will
not be deemed to materially and adversely affect the powers, preferences, privileges or rights of Series B Preferred Stock; or
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(3) consolidate with or merge into any other corporation, complete a binding share exchange or
reclassification involving the Series B Preferred Stock or complete the sale, conveyance, exchange or transfer of all or substantially all of the assets or business of the Corporation unless, in any case, the shares of Series B Preferred Stock
outstanding at the time of such consolidation or merger or sale either (i) remain outstanding or (ii) are converted into or exchanged for preference securities of the surviving entity or any entity controlling the surviving entity having such rights,
preferences, privileges and powers (including voting powers), taken as a whole, as are not materially less favorable to the holders thereof than the rights, preferences, privileges and powers (including voting powers) of the Series B Preferred Stock,
taken as a whole.
The foregoing voting provisions will not apply if, at or prior to the time when the act with respect to which such vote would otherwise be required shall be effected, all outstanding shares of Series B Preferred Stock shall have been redeemed or called for redemption upon proper notice
and sufficient funds shall have been set aside by the Corporation for the benefit of the holders of Series B Preferred Stock to effect such redemption.
(c) If the Corporation fails to
pay, or declare and set aside for payment, dividends on outstanding shares of the Series B Preferred Stock or any Series B Parity Securities having voting rights on parity with the voting rights provided to the Series B Preferred Stock (“Special
Voting Preferred Stock”) for any Series B Dividend Periods that, in the aggregate, equal 18 months, whether or not consecutive (a “Nonpayment Event”), the authorized number of directors of the Corporation shall be increased by two and the holders of
the Series B Preferred Stock (along with holders of any Special Voting Preferred Stock then outstanding, voting together as a class based on respective liquidation preferences), shall have the right to elect two directors (hereinafter the “Preferred
Directors” and each a “Preferred Director”) to fill such newly-created directorships; provided, however, that at no time shall the Board include more than two Preferred Directors; provided further that the election of any such Preferred Directors shall not cause the Corporation to violate any corporate governance requirement of The Nasdaq Stock Market LLC (or any other
exchange on which the Corporation’s securities may be listed). At the request of any holder of Series B Preferred Stock, a special meeting of the holders of Series B Preferred Stock and any such Special Voting Preferred Stock shall be called by the
Corporation for the election of the Preferred Directors; provided, however, that if such request for special meeting is received less than 90 days before the date fixed for the next annual or special meeting of the Corporation’s stockholders, such
election of Preferred Directors shall be held at such next annual or special meeting of stockholders), followed by such election of such Preferred Directors at each subsequent annual meeting of stockholders until full dividends have been declared and
paid on the Series B Preferred Stock for Series B Dividend Periods after the Nonpayment Event that, in the aggregate, equal at least 12 consecutive months, except as provided by law, subject to re-vesting in the event of each and every subsequent
Nonpayment Event.
When dividends have been paid in full (or declared and a
sum sufficient for the payment of such dividends has been set aside for payment) on the Series B Preferred Stock for Series B Dividend Periods after a Nonpayment Event that, in the aggregate, equal at least 12 consecutive months, then the right of
the holders of Series B Preferred Stock to elect the Preferred Stock Directors shall cease (but subject in any case to re-vesting of such voting rights in the case of each and every subsequent Nonpayment Event), and the Preferred Directors shall
cease to be qualified as directors, the term of office of all Preferred Directors then in office shall terminate immediately and the Corporation’s authorized number of directors shall be automatically reduced by the number of Preferred Directors
elected pursuant hereto. Any Preferred Director may be removed at any time, with or without cause by a majority of the outstanding shares of Series B Preferred Stock (along with holders of any Special Voting Preferred Stock then outstanding, voting
together as a class based on respective liquidation preferences). If the office of any Preferred Director becomes vacant for any reason other than removal from office as aforesaid, the remaining Preferred Director may choose, by means of written
consent, a successor who shall hold office for the unexpired term in respect of which such vacancy occurred, or if none remains in office, by a vote of the holders of a majority of the outstanding shares of Series B Preferred Stock (along with
holders of any Special Voting Preferred Stock then outstanding, voting together as a class based on respective liquidation preferences); provided that the filling of any such vacancy shall not cause the Corporation to violate any corporate governance
requirement of The Nasdaq Stock Market LLC (or any other exchange on which the Corporation’s securities may be listed). The Preferred Directors shall each be entitled to one vote per director on any matter on which directors of the Corporation are
entitled to vote.
(d) The rules and procedures for calling and conducting any meeting of the holders of Series B Preferred Stock (including,
without limitation, the fixing of a record date in connection therewith), the solicitation and use of proxies at such a meeting, the obtaining of written consents and any other aspect or matter with regard to such meeting or such consents shall be
governed by any rules that the Board or any duly authorized committee of the Board, in its discretion, may adopt from time to time, which rules and procedures shall conform to the requirements of the Certificate of Incorporation (as then in effect),
the Bylaws (as then in effect), and applicable law and the rules of any national securities exchange on which the Series B Preferred Stock is listed or traded at the time.
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8. Conversion Rights. The holders of shares of Series B Preferred Stock shall not have any rights to convert such shares into shares of any other class or series of securities of the
Corporation.
9. Preemptive Rights. The holders of shares of Series B Preferred Stock will have no preemptive rights with respect to any shares of the Corporation’s capital stock or any of its other
securities convertible into or carrying rights or options to purchase or otherwise acquire any such capital stock or any interest therein, regardless of how any such securities may be designated, issued or granted.
10. Certificates. The
Corporation may at its option issue shares of Series B Preferred Stock without certificates. If certificated, the Corporation shall replace any mutilated certificate at the holder’s expense upon surrender of that certificate to the Corporation. The
Corporation shall replace certificates that become destroyed, stolen or lost at the holder’s expense upon delivery to the Corporation of reasonably satisfactory evidence that the certificate has been destroyed, stolen or lost, together with any
indemnity that may be reasonably required by the Corporation.
11. Transfer Agent. The Corporation shall appoint a transfer agent for the Series B Preferred Stock. The Corporation may, in its sole discretion, remove the transfer agent in accordance
with the agreement between the Corporation and the transfer agent; provided that the Corporation shall appoint a successor transfer agent who shall accept such appointment prior to the effectiveness of such removal.
12. Registrar. The Corporation
shall appoint a registrar for the Series B Preferred Stock. The Corporation may, in its sole discretion, remove the registrar in accordance with the agreement between the Corporation and the registrar; provided that the Corporation shall appoint a
successor registrar who shall accept such appointment prior to the effectiveness of such removal.
13. Calculation Agent. The Corporation shall
appoint a calculation agent for the Series B Preferred Stock prior to June 15, 2022. The Corporation may, in its sole discretion, remove the calculation agent in accordance with the agreement
between the Corporation and the calculation agent; provided that, on or after June 15, 2022, the
Corporation shall appoint a successor calculation agent who shall accept such appointment prior to the effectiveness of such removal.
14. No Other Rights. The shares of Series B Preferred Stock shall not have any rights, preferences, privileges or voting
powers or relative, participating, optional or other special rights, or qualifications, limitations or restrictions thereof, other than as set forth herein or in the Certificate of Incorporation, or as provided by applicable law.
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IN WITNESS
WHEREOF, the Corporation has caused this Certificate of Designation to be duly executed as of January 3, 2022.
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First Citizens BancShares, Inc.
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By:
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/s/ Craig L. Nix
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Name:
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Craig L. Nix
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Title:
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Chief Financial Officer
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[Signature Page to Series B Certificate of Designation]
Exhibit 4.2
CERTIFICATE OF DESIGNATION
OF
5.625% NON-CUMULATIVE
PERPETUAL PREFERRED STOCK, SERIES C
OF
FIRST CITIZENS BANCSHARES, INC.
First Citizens BancShares, Inc., a
corporation organized and existing under the laws of the State of Delaware (the “Corporation”), in accordance with Section 151 of the General Corporation Law of the State of Delaware, does hereby certify:
The Board of Directors of the Corporation (the “Board”), in accordance with the Corporation’s Restated Certificate of
Incorporation, as amended, the Corporation’s Amended and Restated Bylaws, as amended, and applicable law, has adopted the following resolution on October 15, 2020, creating a series of Preferred Stock of 8,000,000 shares from the Corporation’s
authorized Preferred Stock, which series of Preferred Stock is to be designated as “5.625% Non-Cumulative Perpetual Preferred Stock, Series C” (the “Series C Preferred Stock”):
RESOLVED, that pursuant to the
provisions of the Restated Certificate of Incorporation of the Corporation, as amended, the Corporation’s Amended and Restated Bylaws, as amended, and applicable law, a series of Preferred Stock, par value $0.01 per share, of the Corporation be and
hereby is created, and that the number of shares of such series, and the terms, preferences, privileges, designations, rights, qualifications, limitations and restrictions thereof are hereby established as set forth below:
1. Definitions. The following
terms used herein shall be defined as set forth below:
“Appropriate Federal Banking Agency”
means the “appropriate Federal banking agency” with respect to the Corporation as defined in Section 3(q) of the Federal Deposit Insurance Act (12 U.S.C. Section 1813(q)), or any successor provision.
“Business Day” means any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking
institutions are authorized or required by law or regulation to close in The City of New York.
“Bylaws” means the Amended and Restated Bylaws of the Corporation, as they may be amended or restated from time to time.
“Certificate of Incorporation” means the Restated Certificate of Incorporation of the Corporation, as it may be amended or restated from time to time.
“Common Stock” means any and all classes of common stock of the Corporation, including the Class A Common Stock, $1.00 par value
per share, of the Corporation and the Class B Common Stock, $1.00 par value per share of the Corporation.
“Preferred Stock” means any and all series of preferred stock of the Corporation, including the Series A Preferred Stock, the
Series B Preferred Stock and the Series C Preferred Stock.
2. Designation and Number of
Shares. There is hereby created out of the authorized and unissued shares of preferred stock of the Corporation a series of Preferred Stock designated as the “5.625% Non-Cumulative Perpetual Preferred Stock, Series C” (hereinafter
called “Series C Preferred Stock”); the authorized number of shares that shall constitute such series shall be 8,000,000 shares, $0.01 par value per share; and such shares shall have a liquidation preference of $25 per share. The number of shares
constituting the Series C Preferred Stock may be increased from time to time by resolution of the Board or a duly authorized committee of the Board in accordance with the Certificate of Incorporation (as then in effect), the Bylaws (as then in
effect) and applicable law up to the maximum number of shares of Preferred Stock authorized to be issued under the Corporation’s Certificate of Incorporation (as then in effect) less all shares at the time authorized of any other series of Preferred
Stock or decreased from time to time by a resolution of the Board or a duly authorized committee of the Board in accordance with the Certificate of Incorporation (as then in effect), the Bylaws (as then in effect) and applicable law but not below the
number of shares of Series C Preferred Stock then outstanding. Shares of Series C Preferred Stock shall be dated the date of issue, which date shall be referred to herein as the “original issue date.” Shares of outstanding Series C Preferred Stock
that are redeemed, purchased or otherwise acquired by the Corporation shall be cancelled and shall revert to authorized but unissued shares of the Corporation’s Preferred Stock, undesignated as to series.
3. Ranking. The shares of
Series C Preferred Stock shall rank:
(a) senior, as to
dividends and upon liquidation, dissolution and winding-up of the Corporation, to the Common Stock and to any other class or series of capital stock of the Corporation now or hereafter authorized, issued or outstanding that, by its terms, does not
expressly provide that such class or series ranks pari passu with the Series C Preferred Stock or senior to the Series C Preferred Stock as to dividends and
upon liquidation, dissolution and winding-up of the Corporation, as the case may be (collectively, “Series C Junior Securities”);
(b) on a parity, as to dividends and upon liquidation, dissolution and winding-up of the Corporation, with any
class or series of capital stock of the Corporation now or hereafter authorized, issued or outstanding that, by its terms, expressly provides that such class or series ranks pari passu with the Series C Preferred Stock as to dividends and upon liquidation, dissolution and winding-up of the Corporation, as the case may be, including the Corporation’s currently outstanding 5.375% Non-Cumulative Perpetual
Preferred Stock, Series A, par value $0.01 per share, liquidation preference $1,000 (the “Series A Preferred Stock”) and the Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series B, par value $0.01 per share, liquidation preference
of $1,000 per share (collectively, the “Series C Parity Securities”); and
(c) junior, as to dividends and upon liquidation, dissolution and winding-up of the Corporation, to any other
class or series of capital stock of the Corporation now or hereafter authorized, issued or outstanding that, by its terms, expressly provides that such class or series ranks senior to the Series C Preferred Stock as to dividends and upon liquidation,
dissolution and winding-up of the Corporation, as the case may be.
The Corporation may authorize and issue additional shares of Series C Junior Securities and Series C Parity
Securities from time to time without the consent of the holders of the Series C Preferred Stock.
4. Dividends.
(a) Holders of Series
C Preferred Stock will be entitled to receive, only when, as and if declared by the Board or a duly authorized committee of the Board, on each Series C Dividend Payment Date (as defined below), out of assets legally available for the payment of
dividends thereof, non-cumulative cash dividends based on the liquidation preference of the Series C Preferred Stock of $25 per share at a rate equal to 5.625% per annum for each Series C Dividend Period (as defined below) from the original issue
date of the Series C Preferred Stock to, but excluding, the date of redemption (if any) of the Series C Preferred Stock. If the Corporation issues additional shares of the Series C Preferred Stock after the original issue date, dividends on such
shares may accrue from the original issue or any other date specified by the Board or a duly authorized committee of the Board at the time such additional shares are issued.
(b) If declared by the Board or a duly authorized committee of the Board, dividends will be payable on the
Series C Preferred Stock quarterly in arrears on March 15, June 15, September 15 and December 15 of each year, beginning on March 15, 2022, each such day a “Series C Dividend Payment Date”; provided, however, that if any such Series C Dividend Payment Date is not a Business Day, then such date shall
nevertheless be a Series C Dividend Payment Date but dividends on the Series C Preferred Stock shall be paid on the next succeeding Business Day (without any adjustment to the amount of the dividend per share of Series C Preferred Stock).
(c) Dividends will
be payable to holders of record of Series C Preferred Stock as they appear on the Corporation’s stock register on the applicable record date, which shall be the 15th calendar day before the applicable Series C Dividend Payment Date, or such other
record date, not less than 15 calendar days nor more than 30 calendar days before the applicable Series C Dividend Payment Date, as such record date shall be fixed by the Board or a duly authorized committee of the Board.
(d) A “Series C Dividend Period” is the period from and including a Series C Dividend Payment Date to, but
excluding, the next succeeding Series C Dividend Payment Date, except that the initial Series C Dividend Period will commence on and include the original issue date of Series C Preferred Stock and continue to, but exclude, March 15, 2022. Dividends
payable on Series C Preferred Stock will be computed on the basis of a 360-day year consisting of twelve 30-day months. Dollar amounts resulting from the calculation will be rounded to the nearest cent, with one-half cent being rounded upward.
Dividends on the Series C Preferred Stock will cease to accrue on the redemption date, if any, with respect to the Series C Preferred Stock redeemed, unless the Corporation defaults in the payment of the redemption price of the Series C Preferred
Stock called for redemption.
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(e) Dividends on
the Series C Preferred Stock will not be cumulative. If the Board or a duly authorized committee of the Board does not declare a dividend, in full or otherwise, on the Series C Preferred Stock in respect of a Series C Dividend Period, then such
unpaid dividends shall cease to accrue and shall not be payable on the applicable Series C Dividend Payment Date or be cumulative, and the Corporation will have no obligation to pay (and the holders of the Series C Preferred Stock shall have no right
to receive) dividends accrued for such Series C Dividend Period after the Series C Dividend Payment Date for such Series C Dividend Period, whether or not the Board or a duly authorized committee of the Board declares a dividend for any future Series
C Dividend Period with respect to the Series C Preferred Stock, the Common Stock, or any other class or series of the Corporation’s Preferred Stock. No interest, or sum of money in lieu of interest shall be payable in respect of any dividend not
declared.
(f) Notwithstanding
any other provision hereof, dividends on the Series C Preferred Stock shall not be declared, paid or set aside for payment to the extent such act would cause the Corporation to fail to comply with the laws and regulations applicable to it, including
applicable capital adequacy rules of the Board of Governors of the Federal Reserve System (the “Federal Reserve”) or, as and if applicable, the capital adequacy rules or regulations of any Appropriate Federal Banking Agency.
(g) So long as any
share of Series C Preferred Stock remains outstanding:
(1) no dividend shall be declared or
paid or set aside for payment, and no distribution shall be declared or made or set aside for payment, on any Series C Junior Securities, other than (i) a dividend payable solely in Series C Junior Securities or (ii) any dividend in connection with
the implementation of a stockholders’ rights plan, or the issuance of rights, stock or other property under any such plan, or the redemption or repurchase of any rights under any such plan;
(2) no shares of Series C Junior
Securities shall be repurchased, redeemed or otherwise acquired for consideration by the Corporation, directly or indirectly, other than (i) as a result of a reclassification of Series C Junior Securities for or into other Series C Junior Securities,
(ii) the exchange or conversion of one share of Series C Junior Securities for or into another share of Series C Junior Securities, (iii) through the use of the proceeds of a substantially contemporaneous sale of other shares of Series C Junior
Securities, (iv) purchases, redemptions or other acquisitions of shares of Series C Junior Securities in connection with any employment contract, benefit plan or other similar arrangement with or for the benefit of employees, officers, directors or
consultants, (v) purchases of shares of Series C Junior Securities pursuant to a contractually binding requirement to buy Series C Junior Securities existing prior to the preceding Series C Dividend Period, including under a contractually binding
stock repurchase plan, or (vi) the purchase of fractional interests in shares of Series C Junior Securities pursuant to the conversion or exchange provisions of such stock or the security being converted or exchanged; nor shall any monies be paid to
or made available for a sinking fund for the redemption of any such securities by the Corporation; and
(3) no shares of Series C Parity Securities shall be repurchased, redeemed or otherwise acquired for consideration by the
Corporation, directly or indirectly, other than (i) pursuant to pro rata offers to purchase all, or a pro rata portion, of Series C Preferred Stock and such
Series C Parity Securities, (ii) as a result of a reclassification of Series C Parity Securities for or into other Series C Parity Securities, (iii) the exchange or conversion of one share of Series C Parity Securities for or into another share of
Series C Parity Securities, (iv) through the use of the proceeds of a substantially contemporaneous sale of other shares of Series C Parity Securities, (v) purchases of shares of Series C Parity Securities pursuant to a contractually binding
requirement to buy Series C Parity Securities existing prior to the preceding Series C Dividend Period, including under a contractually binding stock repurchase plan, or (vi) the purchase of fractional interests in shares of Series C Parity
Securities pursuant to the conversion or exchange provisions of such stock or the security being converted or exchanged; nor shall any monies be paid to or made available for a sinking fund for the redemption of any such securities by the
Corporation;
unless, in each case, the full dividends for the most recently completed Series C Dividend Period on all outstanding shares of
Series C Preferred Stock have been declared and paid or declared and a sum sufficient for the payment thereof has been set aside.
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(h) Notwithstanding the foregoing, when dividends are not paid in full, or set aside for payment in full, on any dividend payment date, upon the shares of Series C Preferred Stock and any Series C Parity Securities, all dividends declared upon shares of Series C Preferred Stock and any Series C Parity
Securities for such dividend payment date shall be declared on a pro rata basis in proportion to the respective amounts of undeclared and unpaid dividends for the Series C Preferred Stock and all Series C Parity Securities on such dividend payment
date. To the extent a dividend period with respect to any Series C Parity Securities coincides with more than one Series C Dividend Period, for purposes of the immediately preceding sentence the Board shall treat such dividend period as two or more
consecutive dividend periods, none of which coincides with more than one Series C Dividend Period, or shall treat such dividend period(s) with respect to any Series C Parity Securities and Series C Dividend Period(s) for purposes of the immediately
preceding sentence in any other manner that it deems to be fair and equitable in order to achieve ratable payments of dividends on such Series C Parity Securities and the Series C Preferred Stock. To the extent a Series C Dividend Period coincides
with more than one dividend period with respect to any Series C Parity Securities, for purposes of the first sentence of this paragraph the Board shall treat such Series C Dividend Period as two or more consecutive Series C Dividend Periods, none of
which coincides with more than one dividend period with respect to such Series C Parity Securities, or shall treat such Series C Dividend Period(s) and dividend period(s) with respect to any Series C Parity Securities for purposes of the first
sentence of this paragraph in any other manner that it deems to be fair and equitable in order to achieve ratable payments of dividends on the Series C Preferred Stock and such Series C Parity Securities. For the purposes of this paragraph, the term
“dividend period” as used with respect to any Series C Parity Securities means such dividend periods as are provided for in the terms of such Series C Parity Securities.
(i) Subject to the foregoing,
dividends (payable in cash, stock or otherwise), as may be determined by the Board or a duly authorized committee of the Board, may be declared and paid on
the Common Stock and any other class or series of capital stock ranking equally with or junior to Series C Preferred Stock from time to time out of any assets legally available for such payment, and the holders of Series C Preferred Stock shall not
be entitled to participate in any such dividend.
5. Liquidation.
(a) Upon any voluntary or involuntary
liquidation, dissolution or winding-up of the Corporation, holders of Series C Preferred Stock are entitled to receive out of the assets of the Corporation available for distribution to stockholders, after satisfaction of liabilities and obligations
to creditors, if any, and subject to the rights of holders of any securities then outstanding ranking senior to or on parity with Series C Preferred Stock with respect to distributions of assets, before any distribution or payment out of the assets
of the Corporation is made to holders of Common Stock or any Series C Junior Securities, a liquidating distribution in the amount of the liquidation preference of $25 per share plus any declared and unpaid dividends prior to the payment of the
liquidating distribution, without accumulation of any dividends that have not been declared prior to the payment of the liquidating distribution. After payment of the full amount of such liquidating distribution, the holders of Series C Preferred
Stock shall not be entitled to any further participation in any distribution of assets of the Corporation.
(b) In any such liquidating distribution, if the assets of the Corporation are not sufficient to pay the liquidation preferences
(as defined below) in full to all holders of Series C Preferred Stock and all holders of any Series C Parity Securities, the amounts paid to the holders of Series C Preferred Stock and to the holders of all Series C Parity Securities will be paid pro
rata in accordance with the respective aggregate liquidation preferences owed to those holders. In any such distribution, the “liquidation preference” of any holder of Series C Preferred Stock or any Series C Parity Securities means the amount
otherwise payable to such holder in such distribution (assuming no limitation the Corporation’s assets available for such distribution), including any declared but unpaid dividends (and, in the case of any holder of stock other than the Series C
Preferred Stock on which dividends accrue on a cumulative basis, an amount equal to any unpaid, accrued, cumulative dividends, whether or not declared, as applicable). If the liquidation preference has been paid in full to all holders of Series C
Preferred Stock and any Series C Parity Securities, the holders of the Corporation’s Series C Junior Securities shall be entitled to receive all remaining assets of the Corporation according to their respective rights and preferences.
(c) For purposes of this Section 5, neither the sale, conveyance, exchange or transfer of all or substantially all of the assets
or business of the Corporation for cash, securities or other property, nor the merger or consolidation of the Corporation with any other entity, including a
merger or consolidation in which the holders of Series C Preferred Stock receive cash, securities or property for their shares, shall constitute a liquidation, dissolution or winding-up of the Corporation.
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6. Redemption.
(a) Series C Preferred Stock is not subject to any mandatory redemption, sinking fund or other similar provisions. Series C Preferred Stock is not redeemable prior to January 4, 2027. On and after that date, shares of Series C Preferred Stock then outstanding will be redeemable at the
option of the Corporation, subject to the approval of the Federal Reserve or any Appropriate Federal Banking Agency, in whole or in part, from time to time, on any Series C Dividend Payment Date, at a redemption price equal to $25 per share, plus any
declared and unpaid dividends, without accumulation of any undeclared dividends, to, but excluding, the date of redemption. Holders of Series C Preferred Stock will have no right to require the redemption or repurchase of Series C Preferred Stock.
Notwithstanding the foregoing, within 90 days following the occurrence of a Regulatory Capital Treatment Event (as defined below), the Corporation, at its option, may redeem, at any time, all (but not less than all) of the shares of the Series C
Preferred Stock at the time outstanding, at a redemption price equal to $25 per share, plus any declared and unpaid dividends, without accumulation of any undeclared dividends, upon notice given as provided in sub-section (b) below. Any declared but
unpaid dividends payable on a redemption date that occurs subsequent to the record date for a Series C Dividend Period shall not be paid to the holder entitled to receive the redemption price on the redemption date, but rather shall be paid to the
holder of record of the redeemed shares on such record date relating to the Series C Dividend Payment Date as provided in Section 4(c) above. In all cases, the Corporation may not redeem shares of the Series C Preferred Stock without having received
the prior approval of the Federal Reserve or any successor Appropriate Federal Banking Agency if then required under capital rules applicable to the Corporation.
A “Regulatory Capital Treatment Event” means the good faith determination by the Board or a duly authorized committee of the Board
that, as a result of (i) any amendment to, or change in, the laws, rules or regulations of the United States (including, for the avoidance of doubt, any agency or instrumentality of the United States, including the Federal Reserve and other
appropriate federal bank regulatory agencies) or any political subdivision of or in the United States (including, for the avoidance of doubt, any agency or instrumentality of the United States, including the Federal Reserve and other federal banking
agencies) that is enacted or becomes effective after the initial issuance of any share of the Series C Preferred Stock; (ii) any proposed change in those laws, rules or regulations that is announced after the initial issuance of any share of the
Series C Preferred Stock; or (iii) any official administrative decision or judicial decision or administrative action or other official pronouncement interpreting or applying those laws, rules or regulations or policies with respect thereto that is
announced after the initial issuance of any share of the Series C Preferred Stock, there is more than an insubstantial risk that the Corporation will not be entitled to treat the full liquidation value of the shares of the Series C Preferred Stock
then outstanding as “Tier 1 Capital” (or its equivalent) for purposes of the capital adequacy rules of the Federal Reserve (or, as and if applicable, the capital adequacy rules or regulations of any successor Appropriate Federal Banking Agency), as
then in effect and applicable, for as long as any share of the Series C Preferred Stock is outstanding.
(b) If shares of Series C Preferred Stock are to be redeemed, the notice of redemption shall be given to the holders of record of
Series C Preferred Stock to be redeemed by first class mail, postage prepaid, addressed to the holders of record of such shares to be redeemed at their respective last addresses appearing on the Corporation’s stock register not less than 30 days nor
more than 60 days prior to the date fixed for redemption thereof (provided that, if the shares of Series C Preferred Stock are held in book-entry form through The Depository Trust Company (“DTC”), the Corporation may give such notice in any manner
permitted by DTC). Each notice of redemption will include a statement setting forth: (i) the redemption date; (ii) the number of shares of Series C Preferred Stock to be redeemed and, if less than all the shares held by such holder are to be redeemed, the number of such shares to be redeemed from such holder; (iii) the redemption price; and (iv) that dividends on the shares to be redeemed will cease to
accrue on the redemption date. If notice of redemption of any shares of Series C Preferred Stock has been duly given and if the funds necessary for such redemption have been set aside by the Corporation for the benefit of the holders of any shares of
Series C Preferred Stock so called for redemption, then, on and after the redemption date, dividends will cease to accrue on such shares of Series C Preferred Stock, such shares of Series C Preferred Stock shall no longer be deemed outstanding and
all rights of the holders of such shares will terminate, except the right to receive the redemption price described in sub-section (a) above, without interest.
(c) In case of any redemption of only part of the shares of Series C Preferred Stock at the time outstanding, the shares to be
redeemed shall be selected (1) pro rata, (2) by lot or (3) in such other manner as the Corporation may determine to be equitable and permitted by DTC and the rules of any national securities exchange on which the Series C Preferred Stock is listed.
7. Voting Rights.
(a) Except as provided below or as expressly required by law, the holders of shares of Series C Preferred Stock shall have no
voting power, and no right to vote on any matter at any time, either as a separate series or class or together with any other series or class of shares of capital stock, and shall not be entitled to call a meeting of such holders for any purpose, nor
shall they be entitled to participate in any meeting of the holders of the Common Stock.
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(b) So long as any shares of Series C Preferred Stock remain outstanding, the affirmative vote or consent of the holders of at
least two-thirds of all of the shares of Series C Preferred Stock at the time outstanding, voting separately as a class, shall be required to:
(1) authorize, create or issue, or increase the authorized amount of, shares of any class or series of capital
stock ranking senior to the Series C Preferred Stock with respect to payment of dividends or the distribution of assets upon liquidation, dissolution or winding up of the Corporation, or issue any obligation or security convertible into or
exchangeable for or evidencing the right to purchase, any such class or series of the Corporation’s capital stock;
(2) amend, alter or repeal the provisions of the Corporation’s Certificate of Incorporation (including this
Certificate of Designation), whether by merger, consolidation or otherwise, so as to materially and adversely affect the powers, preferences, privileges or rights of Series C Preferred Stock, taken as a whole; provided, however, that any amendment to
authorize, create or issue, or increase the authorized amount of, any Series C Junior Securities or any Series C Parity Securities, or any securities convertible into or exchangeable for Series C Junior Securities or Series C Parity Securities, will
not be deemed to materially and adversely affect the powers, preferences, privileges or rights of Series C Preferred Stock; or
(3) consolidate with or merge into any other corporation, complete a binding share exchange or
reclassification involving the Series C Preferred Stock or complete the sale, conveyance, exchange or transfer of all or substantially all of the assets or business of the Corporation unless, in any case, the shares of Series C Preferred Stock
outstanding at the time of such consolidation or merger or sale either (i) remain outstanding or (ii) are converted into or exchanged for preference securities of the surviving entity or any entity controlling the surviving entity having such rights,
preferences, privileges and powers (including voting powers), taken as a whole, as are not materially less favorable to the holders thereof than the rights, preferences, privileges and powers (including voting powers) of the Series C Preferred Stock,
taken as a whole.
The foregoing voting provisions will not apply if, at or prior to the time when the act with respect to which such vote would otherwise be required shall be effected, all outstanding shares of Series C Preferred Stock shall have been redeemed or called for redemption upon proper notice
and sufficient funds shall have been set aside by the Corporation for the benefit of the holders of Series C Preferred Stock to effect such redemption.
(c) If the Corporation fails to pay,
or declare and set aside for payment, dividends on outstanding shares of the Series C Preferred Stock or any Series C Parity Securities having voting rights on parity with the voting rights provided to the Series C Preferred Stock (“Special Voting
Preferred Stock”) for any Series C Dividend Periods that, in the aggregate, equal 18 months, whether or not consecutive (a “Nonpayment Event”), the authorized number of directors of the Corporation shall be increased by two and the holders of the
Series C Preferred Stock (along with holders of any Special Voting Preferred Stock then outstanding, voting together as a class based on respective liquidation preferences), shall have the right to elect two directors (hereinafter the “Preferred
Directors” and each a “Preferred Director”) to fill such newly-created directorships; provided, however, that at no time shall the Board include more than two Preferred Directors; provided further that the election of any such Preferred Directors shall not cause the Corporation to violate any corporate governance
requirement of The Nasdaq Stock Market LLC (or any other exchange on which the Corporation’s securities may be listed). At the request of any holder of Series C Preferred Stock, a special meeting of the holders of Series C Preferred Stock and any
such Special Voting Preferred Stock shall be called by the Corporation for the election of the Preferred Directors; provided, however, that if such request for special meeting is received less than 90 days before the date fixed for the next annual or
special meeting of the Corporation’s stockholders, such election of Preferred Directors shall be held at such next annual or special meeting of stockholders), followed by such election of such Preferred Directors at each subsequent annual meeting of
stockholders until full dividends have been declared and paid on the Series C Preferred Stock for Series C Dividend Periods after the Nonpayment Event that, in the aggregate, equal at least 12 consecutive months, except as provided by law, subject to
re-vesting in the event of each and every subsequent Nonpayment Event.
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When dividends have been paid in full (or declared and a
sum sufficient for the payment of such dividends have been set aside for payment) on the Series C Preferred Stock for Series C Dividend Periods after a Nonpayment Event that, in the aggregate, equal at least 12 consecutive months, then the right of
the holders of Series C Preferred Stock to elect the Preferred Stock Directors shall cease (but subject in any case to re-vesting of such voting rights in the case of each and every subsequent Nonpayment Event), and the Preferred Directors shall
cease to be qualified as directors, the term of office of all Preferred Directors then in office shall terminate immediately and the Corporation’s authorized number of directors shall be automatically reduced by the number of Preferred Directors
elected pursuant hereto. Any Preferred Director may be removed at any time, with or without cause by a majority of the outstanding shares of Series C Preferred Stock (along with holders of any Special Voting Preferred Stock then outstanding, voting
together as a class based on respective liquidation preferences). If the office of any Preferred Director becomes vacant for any reason other than removal from office as aforesaid, the remaining Preferred Director may choose, by means of written
consent, a successor who shall hold office for the unexpired term in respect of which such vacancy occurred, or if none remains in office, by a vote of the holders of a majority of the outstanding shares of Series C Preferred Stock (along with
holders of any Special Voting Preferred Stock then outstanding, voting together as a class based on respective liquidation preferences); provided that the filling of any such vacancy shall not cause the Corporation to violate the corporate governance
requirement of The Nasdaq Stock Market LLC (or any other exchange on which the Corporation’s securities may be listed). The Preferred Directors shall each be entitled to one vote per director on any matter on which directors of the Corporation are
entitled to vote.
(d) The rules and procedures for calling and conducting any meeting of the holders of Series C Preferred Stock (including, without
limitation, the fixing of a record date in connection therewith), the solicitation and use of proxies at such a meeting, the obtaining of written consents and any other aspect or matter with regard to such meeting or such consents shall be governed
by any rules that the Board or any duly authorized committee of the Board, in its discretion, may adopt from time to time, which rules and procedures shall conform to the requirements of the Certificate of Incorporation (as then in effect), the
Bylaws (as then in effect), and applicable law and the rules of any national securities exchange on which the Series C Preferred Stock is listed or traded at the time.
8. Conversion Rights. The holders of shares of Series C Preferred Stock shall not have any rights to convert such shares into shares of any other class or series of securities of the
Corporation.
9. Preemptive Rights. The holders of shares of Series C Preferred Stock will have no preemptive rights with respect to any shares of the Corporation’s capital stock or any of its other
securities convertible into or carrying rights or options to purchase or otherwise acquire any such capital stock or any interest therein, regardless of how any such securities may be designated, issued or granted.
10. Certificates. The
Corporation may at its option issue shares of Series C Preferred Stock without certificates. If certificated, the Corporation shall replace any mutilated certificate at the holder’s expense upon surrender of that certificate to the Corporation. The
Corporation shall replace certificates that become destroyed, stolen or lost at the holder’s expense upon delivery to the Corporation of reasonably satisfactory evidence that the certificate has been destroyed, stolen or lost, together with any
indemnity that may be reasonably required by the Corporation.
11. Transfer Agent. The Corporation shall appoint a transfer agent for the Series C Preferred Stock. The Corporation may, in its sole discretion, remove the transfer agent in accordance
with the agreement between the Corporation and the transfer agent; provided that the Corporation shall appoint a successor transfer agent who shall accept such appointment prior to the effectiveness of such removal.
12. Registrar. The Corporation
shall appoint a registrar for the Series C Preferred Stock. The Corporation may, in its sole discretion, remove the registrar in accordance with the agreement between the Corporation and the registrar; provided that the Corporation shall appoint a
successor registrar who shall accept such appointment prior to the effectiveness of such removal.
13. No Other Rights. The shares of Series C Preferred Stock shall not have any rights, preferences, privileges or voting
powers or relative, participating, optional or other special rights, or qualifications, limitations or restrictions thereof, other than as set forth herein or in the Certificate of Incorporation, or as provided by applicable law.
7
IN WITNESS
WHEREOF, the Corporation has caused this Certificate of Designation to be duly executed as of January 3, 2022.
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First Citizens BancShares, Inc.
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By:
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/s/ Craig L. Nix
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Name:
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Craig L. Nix
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Title:
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Chief Financial Officer
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[Signature Page to Series C Certificate of Designation]
Exhibit 99.1
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For Immediate Release
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Contact:
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Barbara Thompson
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Deanna Hart
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January 4, 2022
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Corporate Communications
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Investor Relations
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919-716-2716
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919-716-2137
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FIRST CITIZENS COMPLETES MERGER
WITH CIT GROUP
RALEIGH, N.C. –– First Citizens BancShares Inc. (NASDAQ: FCNCA) (“First Citizens”), parent company of First-Citizens Bank & Trust Company (“First Citizens Bank”), today announced completion of
its previously announced merger with CIT Group Inc. (“CIT”).
North Carolina-headquartered First Citizens is now a top 20 U.S. financial institution (based on assets), with more than $100 billion in
assets, and the largest family-controlled bank in the nation. The merger brings together complementary strengths of both organizations, combining First Citizens Bank’s robust retail franchise and full suite of banking products with CIT’s strong
market position in nationwide commercial lending and direct digital banking. The combined company now operates under the First Citizens Bank name.
“This is a transformational milestone in our 124-year history,” said Frank B. Holding Jr., First Citizens chairman and chief executive
officer. “It brings together two companies with deep traditions of service and excellence. We’re not just creating a bigger bank – we’re creating an even better bank – one that helps more people in more places and strengthens the communities we
serve. Completion of the merger is a testament to the many associates on our teams who have worked so diligently to get us here.”
CIT, CIT Bank and OneWest Bank will initially operate as divisions of First Citizens Bank, and these customers will be able to continue to
bank as they normally do. For now, they will be served through their current branches, websites, mobile apps, bankers and advisors. Over the coming months, a series of conversions to First Citizens’ systems and operations will take place.
“For CIT clients, First Citizens brings its proven record of safety, security and focus on long-term relationships while maintaining the
expertise and agility that they have come to expect,” Holding said. “For First Citizens customers, everything they count on us for will stay the same: same service, same values, same commitment to helping them do more with their money. In the long
term, all our customers will get even more services, more ways to manage their money and more places to find us.”
Ellen R. Alemany, former chairwoman and chief executive officer of CIT, assumes the role of vice chairwoman of First Citizens (along with
current First Citizens Vice Chairwoman Hope Holding Bryant) and will serve on the First Citizens Board of Directors. The board now consists of 11 current First Citizens directors and three former CIT board members — Alemany, Michael A. Carpenter and
Vice Admiral John R. Ryan, USN (Ret.).
In addition, Marisa J. Harney is now a member of the First Citizens executive leadership team and assumes the role of chief credit officer.
Harney previously served as executive vice president and chief credit officer with CIT.
First Citizens Bank is positioned to be a one-stop financial services destination for customers across the country, providing a full suite of
retail, business, commercial and wealth products and services. Known for stability and a long-term approach to banking, First Citizens now operates more than 600 branches in 22 states and a national direct bank while also offering commercial
financing, community association banking, middle market banking, equipment and vendor financing, railcar financing, treasury and payments services, and capital markets and asset management.
In addition to its Raleigh, N.C., headquarters, First Citizens operates significant operation centers in New York, Pasadena, Omaha, Phoenix,
Jacksonville, Fla., New Jersey and Columbia, S.C., among other locations.
First Citizens is committed to investing in the communities it
serves. The bank previously announced a community benefits plan to reinvest $16 billion to serve low- and moderate-income (LMI) communities and borrowers through 2025. This plan expands on the two companies’ work to support affordable home ownership, small business lending and community development.
About First Citizens
First Citizens BancShares Inc. is the financial holding company for First Citizens Bank. First Citizens Bank helps personal, business,
commercial and wealth clients build financial strength that lasts. As the largest family-controlled bank in the U.S., First Citizens is continuing a unique legacy of strength, stability and long-term thinking that has spanned generations. Founded in
1898 and headquartered in Raleigh, N.C., First Citizens Bank also operates a nationwide direct bank and a network of more than 600 branches in 22 states, many in high-growth markets. Industry specialists bring a depth of expertise that helps
businesses and individuals meet their specific goals at every stage of their financial journey. First Citizens Bank brings together personal service and powerful tools to help customers do more with their money – and make more of their future. Visit
firstcitizens.com. First Citizens Bank. Forever First®
Cautionary Notes Regarding Forward-Looking Statements
Certain of the statements made in this Press Release may constitute forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words “expect,” “anticipate,” “intend,” “plan,” “believe,” “seek” and “estimate,”
and similar expressions, are intended to identify such forward-looking statements, but other statements not based on historical information may also be considered forward-looking. Forward-looking statements include statements about the benefits to
First Citizens of the merger with CIT (collectively, the “Merger”), and First Citizens’ future financial and operating results, plans, objectives and intentions. All forward-looking statements are subject to known and unknown risks, uncertainties,
and other factors that may cause the actual results, performance, or achievements to differ materially from any results, performance, or achievements expressed or implied by such forward-looking statements, including, among others, (1) disruption
from the Merger, or recently completed mergers, with customer, supplier or employee relationships, (2) the possibility that the amount of the costs, fees, expenses and charges related to the Merger may be greater than anticipated, including as a
result of unexpected or unknown factors, events or liabilities, (3) reputational risk and the reaction of the parties’ customers to the Merger, (4) the risk that the cost savings and any revenue synergies from the Merger may not be realized or take
longer than anticipated to be realized, (5) general competitive, economic, political and market conditions, and (6) difficulties experienced in the integration of the businesses. Except to the extent required by applicable law or regulation, First
Citizens disclaims any obligation to update such factors or to publicly announce the results of any revisions to any of the forward-looking statements included herein to reflect future events or developments. Additional factors which could affect the
forward-looking statements can be found in First Citizens’ Annual Report on Form 10-K for the fiscal year ended December 31, 2020, its Quarterly Reports on Form 10-Q for the periods ended March 31, 2021, June 30, 2021 and September 30, 2021, and its
other filings with the Securities and Exchange Commission (the “SEC”), and in CIT’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020, as amended on Form 10-K/A, its Quarterly Reports on Form 10-Q for the periods ended March 31,
2021, June 30, 2021 and September 30, 2021, and its other filings with the SEC. The contents of any website referenced in this communication are not incorporated by reference herein.