United National Bancorp and New Era Bank Announce Intent to Merge.

BRANCHBURG, N.J.--(BUSINESS WIRE)--Feb. 2, 1995--United National Bancorp (NASDAQ: UNBJ) and New Era Bank jointly announced today that they have signed a definitive agreement under which United National will acquire New Era in a merger which is intended to be a tax free transaction and which will be accounted for as a pooling of interests.

Each of the outstanding shares of New Era will be exchanged for .7431 shares of United National.

"We are pleased with this acquisition, which clearly fits our expansion plans," stated Thomas C. Gregor, president and chief executive officer of United National. The merger will expand United National's presence in Somerset County, New Jersey. "Based upon identified cost savings, we also believe that within a year following consummation, the transaction will be accretive to the earnings of United National," noted Gregor.

Mayo Sisler, chairman and chief executive officer of New Era, noted "United National's financial strengths, trust capabilities, and personnel made it the ideal partner for us in terms of our customers, our stockholders and our community."

New Era is an approximately $112 million asset, single-office bank headquartered in Franklin Township, New Jersey. New Era has an application pending to open a new office in Edison. The eight year old New Era Bank was the first bank in New Jersey to offer secured credit cards and continues to do so, with customers across the country. New Era presently has 771,076 shares of common stock outstanding and has issued $1,270,020 of subordinated debentures with related mandatory stock purchase contracts. The purchase contracts obligate New Era to issue and the holders to purchase 77,205 shares of New Era at $16.45 per share on March 31, 1995. The related 12% debentures are due March 31, 1996, but may be redeemed at par after March 31, 1995 if not utilized to fund the purchase of the New Era common stock under the purchase contracts.

New Era has outstanding employee stock options for 77,108 shares of its common stock, with a weighted average exercise price of $7.81 per share. The merger agreement provides that each option for one share of New Era common stock will be converted into an option for .7431 shares of United National common stock or, if the options are fully vested and the optionee so elects, into shares of United National common stock with a value equal to the difference between the option exercise price and the value of .7431 shares of United National common stock.

The acquisition is conditioned upon necessary bank regulatory approvals, the approval of the shareholders of New Era and, if necessary, United National and other customary conditions. The parties anticipate that the merger will be consummated in the third quarter of 1995. In connection with the merger agreement, New Era granted United National an option to purchase 230,000 shares of New Era's authorized but unissued common stock.

Untied National Bank, the principal subsidiary of United National Bancorp, has approximately $807 million in assets and operates 17 branches in Union, Middlesex, Somerset, Hunterdon and Warren Counties, following its recent acquisition of two new branches. On Jan. 20, 1995, United National Bank acquired two branches of the former Carteret Federal Savings Bank from the Resolution Trust Corp. The two branches added approximately $100 million of deposits. United National paid a premium of approximately $11.7 million to the RTC in the transaction.

CONTACT: United National Bancorp

Pierce Baugh, 908/756-5000 ext. 2365

or

New Era Bank

Mayo Sisler, 908/937-5000