Edgar Filing: WACHOVIA CORP/ NC

REVISED PRELIMINARY COPY - SUBJECT TO COMPLETION, DATED MAY 29, 2001

SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934

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the Commission only (as
permitted by Rule 14a-6(e)(2))
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 14a-12

WACHOVIA CORPORATION
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(Name of Registrant As Specified In Its Charter)

SUNTRUST BANKS, INC.
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

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REVISED PRELIMINARY COPY - SUBJECT TO COMPLETION
DATED MAY 29, 2001

[SUNTRUST BANKS, INC. LOGO]

May __, 2001

Dear Wachovia Stockholder:

On May 14, 2001, SunTrust Banks, Inc. announced that it had
delivered a letter to your board of directors proposing a business
combination between SunTrust and Wachovia Corporation that we believe is
financially superior to Wachovia's proposed merger with First Union
Corporation. Under our proposal, Wachovia and SunTrust would combine in a
merger in which each share of common stock of Wachovia would be converted
into 1.081 shares of SunTrust common stock. Based on May 25, 2001 closing
stock prices, our proposal has a value of $65.62 per share and represented
a premium over the implied value of Wachovia's proposed merger with First
Union as of such date. Pursuant to our merger proposal, SunTrust also would
increase its annual per share dividend to $2.22 so that Wachovia
stockholders would receive on a pro forma equivalent basis the same $2.40
annual per share dividend that they currently enjoy.

As you know, Wachovia has entered into a merger agreement with
First Union providing for a merger in which each outstanding share of
Wachovia common stock would be converted into two shares of First Union
common stock and, as more fully described below, Wachovia shareholders
would have the right to elect either a special one-time $0.48 dividend or
preferred stock of First Union that is designed to give Wachovia
shareholders an amount of dividends which, when added to the dividends on
the First Union common stock, would equal on a pro forma equivalent basis
the $2.40 annual dividend per share of Wachovia common stock. In connection
with the proposed First Union merger, Wachovia has scheduled its 2001
annual meeting of stockholders for August 3, 2001, at [ ], at [ ] a.m.,
local time. The Wachovia Board of Directors is soliciting your vote to
approve its proposed merger with First Union at that meeting.

AS DISCUSSED IN THE ACCOMPANYING PROXY STATEMENT, WE BELIEVE OUR
PROPOSED MERGER OFFERS YOU A HIGHER PREMIUM AND GREATER VALUE THAN THE
PROPOSED FIRST UNION/WACHOVIA MERGER. However, our proposal requires that
the proposed First Union/Wachovia merger NOT be approved by the
stockholders of Wachovia. Accordingly, we are soliciting your proxy to vote
AGAINST the proposed First Union/Wachovia merger.

WE BELIEVE THE SUNTRUST PROPOSAL IS FINANCIALLY SUPERIOR TO THE
PROPOSED FIRST UNION/WACHOVIA MERGER FOR THE FOLLOWING REASONS:

o HIGHER PREMIUM. Our proposed merger would provide a
premium for your Wachovia shares over what First Union is
proposing to pay. Based on May 25, 2001 closing prices,
the SunTrust merger proposal would provide you with
$65.62 per share in value, representing a premium of
$2.42 per share (or almost 4%) over the implied value of
the proposed First Union/Wachovia merger, which was worth
less than Wachovia's closing price on such date. Because
the exchange ratios in the SunTrust merger proposal and
the proposed First Union/Wachovia merger are fixed, the
implied values of the SunTrust merger proposal and the
proposed First Union/Wachovia merger will fluctuate based
on changes in the respective market prices of the
companies' stocks.

o STRONGER CURRENCY. Our merger proposal would provide
Wachovia shareholders an opportunity to invest in
SunTrust common stock, which has demonstrated stronger
performance and delivered more attractive total returns
than First Union's common stock over the past 1, 5 and
10-year periods. Through March 31, 2001, SunTrust
produced one-year, five-year and ten-year total returns
to stockholders of 15.3%, 98.2% and 493.0%, respectively.
Based on historical results and First Call consensus
estimates for 2001, SunTrust's core earnings per share
reflect a five-year compounded annual growth rate of 12%
from 1996-2001.

o SIMPLER AND BETTER DIVIDEND. Under SunTrust's proposal,
SunTrust would increase the annual per share dividend on
its common stock to $2.22 so that Wachovia stockholders
would receive on a pro forma equivalent basis the same
$2.40 annual per share dividend that they currently
enjoy. SunTrust has had consistent dividend growth
(five-year compounded annual growth rate of 14% in
dividends per share), has never cut its dividend and has
significant additional capacity to increase its dividend.

First Union's proposed merger with Wachovia
would provide you with an ongoing annual per share
dividend of $1.92 on a pro-forma equivalent basis, which
represents a 20% decrease from Wachovia's current annual
per share dividend. However, to make up this difference,
First Union is offering you a choice of also receiving
either a special one-time dividend of $0.48 per share at
closing to cover the dividend shortfall for the first
year after closing, or preferred shares of First Union
that would pay a dividend sufficient to ensure that you
receive on a pro forma equivalent basis a $2.40 annual
dividend per share of Wachovia common stock.

We believe the dividend component of the
SunTrust merger proposal is simpler and better. We
believe it's simpler because you don't have to hold any
security other than your shares of SunTrust common stock
to receive the full dividend. We believe it's better than
First Union's one-time special dividend alternative
because under that alternative, First Union would have to
increase its current dividend by 25% by the beginning of
the second year after its merger in order for you to
continue receiving the same per share dividend you
currently enjoy. And we believe the dividend component of
our proposal is better than First Union's preferred stock
alternative because you may not be able to sell your
preferred shares together with your First Union common
stock if the preferred shares are not transferable or if
a liquid market for the preferred shares doesn't develop.

YOUR VOTE IS ESSENTIAL! IF THE FIRST UNION/WACHOVIA MERGER IS
APPROVED, YOU WILL NOT HAVE THE OPPORTUNITY TO RECEIVE THE SUPERIOR
VALUE REPRESENTED BY OUR MERGER PROPOSAL. WE URGE YOU TO VOTE
AGAINST THE PROPOSED FIRST UNION/WACHOVIA MERGER BY SIGNING, DATING AND
RETURNING THE ACCOMPANYING [BLUE] PROXY CARD TODAY.

Even if you previously have submitted a proxy card furnished by
the Wachovia Board, it is not too late to change your vote by simply
signing, dating and returning the enclosed [BLUE] proxy card today.

WE URGE YOU TO PROTECT YOUR INTERESTS - PLEASE SIGN, DATE AND
RETURN THE [BLUE] PROXY CARD TODAY.

Thank you for your consideration and support.

Sincerely,

L. Phillip Humann
Chairman, President and Chief Executive Officer

THIS PROXY STATEMENT RELATES SOLELY TO THE SOLICITATION OF PROXIES
IN OPPOSITION TO THE PROPOSED FIRST UNION/WACHOVIA MERGER AND IS NEITHER AN
OFFER TO SELL ANY SHARES OF SUNTRUST COMMON STOCK NOR A REQUEST FOR THE
TENDER OF WACHOVIA COMMON STOCK. THE ISSUANCE OF SUNTRUST COMMON STOCK IN
CONNECTION WITH SUNTRUST'S PROPOSED MERGER WITH WACHOVIA WILL HAVE TO BE
REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY ONLY BE MADE BY MEANS
OF A PROSPECTUS COMPLYING WITH THE REQUIREMENTS OF SUCH ACT.

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IMPORTANT

1. If your Wachovia shares are held in your own name, please sign,
date and mail the enclosed [BLUE] proxy card to Innisfree M&A
Incorporated in the postage-paid envelope provided.

2. If your Wachovia shares are held in "street-name," only your
broker or bank can vote your shares and only upon receipt of your
specific instructions. If your shares are held in "street- name,"
deliver the enclosed [BLUE] proxy card to your broker or bank and
contact the person responsible for your account to vote on your
behalf and to ensure that a [BLUE] proxy card is submitted on your
behalf. SunTrust urges you to confirm in writing your instructions
to the person responsible for your account and to provide a copy
of those instructions to SunTrust in care of Innisfree M&A
Incorporated, so that SunTrust will be aware of all instructions
given and can attempt to ensure that such instructions are
followed.

3. Only stockholders of record on June 12, 2001 are entitled to vote
at the annual meeting of Wachovia stockholders. SunTrust urges
each stockholder to ensure that the record holder of his or her
shares signs, dates and returns the enclosed proxy card as soon as
possible.

Do not sign or return any [white] proxy card you may receive from
Wachovia.

If you have any questions or need assistance in voting your
shares, please call:

INNISFREE M&A INCORPORATED
501 Madison Avenue, 20th Floor
New York, New York 10022
CALL TOLL-FREE 1-877-750-9501
Banks and Brokers call collect: 212-750-5833

PRELIMINARY COPY - SUBJECT TO COMPLETION, DATED MAY 29, 2001

2001 ANNUAL MEETING OF STOCKHOLDERS
OF
WACHOVIA CORPORATION
TO BE HELD ON AUGUST 3, 2001

PROXY STATEMENT
OF
SUNTRUST BANKS, INC.

SOLICITATION OF PROXIES
IN OPPOSITION TO THE PROPOSED MERGER OF
WACHOVIA CORPORATION AND FIRST UNION CORPORATION

This Proxy Statement and the enclosed [BLUE] proxy card are
furnished by SunTrust Banks, Inc., a Georgia corporation ("SunTrust"), in
connection with its solicitation of proxies to be used at the 2001 annual
meeting (the "Annual Meeting") of stockholders of Wachovia Corporation, a
North Carolina corporation ("Wachovia"), to be held on August 3, 2001, at [
], at [ ]a.m., local time, and at any adjournments, postponements or
reschedulings thereof. Pursuant to this Proxy Statement, SunTrust is
soliciting proxies from holders of shares of common stock, par value $5.00
per share, of Wachovia ("Wachovia Common Stock") to vote AGAINST the
proposed merger of Wachovia with and into First Union Corporation, a North
Carolina corporation ("First Union") (such proposed merger, the "Proposed
First Union Merger"). Wachovia has set the close of business on June 12,
2001 as the record date (the "Record Date") for determining those
stockholders who will be entitled to vote at the Annual Meeting. This Proxy
Statement and the enclosed [BLUE] proxy are first being sent or given to
stockholders of Wachovia on or about [ ], 2001. Wachovia's corporate
headquarters are located at 100 North Main Street, Winston-Salem, North
Carolina 27150, telephone (336) 770-5000 and 191 Peachtree Street, N.E.,
Atlanta, Georgia 30303, telephone (404) 332-5000.

THE SUNTRUST MERGER PROPOSAL

On May 14, 2001, SunTrust delivered a letter to the Board of
Directors of Wachovia proposing a business combination that SunTrust
believes constitutes a financially superior transaction for holders of
Wachovia Common Stock. Under SunTrust's proposal (the "SunTrust Merger
Proposal"), Wachovia and SunTrust would combine in a merger (the "Proposed
SunTrust Merger") in which each share of Wachovia Common Stock would be
converted into 1.081 shares of common stock, par value $1.00 per share
("SunTrust Common Stock"), of SunTrust. SunTrust also would increase its
annual per share dividend to $2.22 so that Wachovia shareholders would
receive on a pro forma equivalent basis the same $2.40 annual per share
dividend that they currently enjoy.

Based on the closing price of SunTrust Common Stock on the New
York Stock Exchange ("NYSE") on May 25, 2001, the SunTrust Merger Proposal
had a value of $65.62 per Wachovia share, which represents a 3.8% premium
over the implied value of the Proposed First Union Merger of $63.20 (based
on the 2.0 exchange ratio in that transaction and the $31.60 closing price
of First Union common stock on May 25, 2001). Because the number of shares
of SunTrust common stock that Wachovia shareholders would receive pursuant
to the SunTrust Merger Proposal and the number of shares of First Union
common stock that Wachovia shareholders would receive in the Proposed First
Union Merger are fixed, the value of the SunTrust Merger Proposal and uhe
implied value of the Proposed First Union Merger will fluctuate based on
changes in the market prices of the companies' stocks.

The Proposed SunTrust Merger would be tax-free to Wachovia
shareholders and would be accounted for as a purchase. SunTrust
contemplates providing leadership roles in the combined company for
numerous members of Wachovia's management, and Wachovia would have
appropriate representation on the board of directors of the combined
company. In this regard, SunTrust's determination of the extent of Wachovia
representation on the board of directors of the combined company would be
based on various considerations, including the timing of any merger of
SunTrust and Wachovia, an analysis of the relative contributions of each
company to the combined company's prospective earnings, and negotiations
with Wachovia. The combined company would be headquartered in Atlanta,
Georgia, and Winston-Salem, North Carolina would become the headquarters
for the combined company's North and South Carolina banking franchise.

The SunTrust Merger Proposal is subject to certain conditions,
including (i) the valid termination of the Agreement and Plan of Merger,
dated April 15, 2001, between First Union and Wachovia (the "First Union
Merger Agreement"), (ii) an update and completion of the due diligence
investigation performed by SunTrust in December 2000, (iii) the execution
of a definitive merger agreement by SunTrust and Wachovia providing for the
Proposed SunTrust Merger, and (iv) the invalidation of the stock option
agreement entered into by Wachovia and First Union and the related option
granted by Wachovia to First Union thereunder (collectively, the "First
Union Option"), or, alternatively, the surrender by First Union of the
First Union Option in exchange for a cash payment equal to the in-the-money
value of the First Union Option, subject to the minimum surrender value of
the option of $375 million and the purported "cap" of $780 million (the
"First Union Option Condition"). See "Certain Information Concerning the
First Union Option." SunTrust believes the First Union Option contains
several excessive and unprecedented features and has commenced an action in
Superior Court in Fulton County, Georgia challenging the validity of that
option. See "Certain Litigation."

SunTrust would be willing to enter into a definitive merger
agreement with Wachovia that is similar in all material respects (including
with respect to closing conditions) to the First Union Merger Agreement,
except that the financial terms of such agreement would reflect the
financial terms of the SunTrust Merger Proposal, and such agreement, unlike
the First Union Merger Agreement, would permit Wachovia to terminate such
agreement in the event the Wachovia shareholders were to vote against the
Proposed SunTrust Merger instead of waiting until the termination date of
any such agreement. The material conditions that SunTrust would expect to
be contained in a merger agreement with Wachovia would be the approval of
such merger agreement by the shareholders of both SunTrust and Wachovia and
the receipt of all required regulatory approvals. See "Regulatory Approvals
Required for the Proposed SunTrust Merger."

There can be no assurance as to the timing or satisfaction of the
conditions to the SunTrust Merger Proposal or as to the timing or
satisfaction of the conditions that would be contained in a merger
agreement between SunTrust and Wachovia. While certain conditions are
within the control of the Wachovia Board of Directors, the First Union
Option Condition is not within the control of the Wachovia Board of
Directors. However, SunTrust intends to vigorously pursue its rights to
challenge the validity of the First Union Option as expeditiously as
possible. See "Certain Litigation." SunTrust expects to file within the
next several days all required applications with the appropriate regulatory
authorities and believes there is no reason why such applications will not
be approved in the ordinary and usual course. Accordingly, absent certain
impediments described above, SunTrust believes the Proposed SunTrust Merger
could close without any material delays beyond the timing of any proposed
closing of the Proposed First Union Merger assuming First Union would agree
with Wachovia to terminate the First Union Merger Agreement in the event
Wachovia shareholders do not approve the Proposed First Union Merger.
SunTrust believes that if Wachovia's shareholders do not approve the
Proposed First Union Merger, First Union's interest will be in realizing
value for the First Union Option. In such a circumstance, and assuming
Wachovia was willing to enter into merger discussions with SunTrust in the
event Wachovia shareholders do not approve the Proposed First Union Merger,
SunTrust believes First Union would enter into negotiations with SunTrust
with respect to the First Union Option and if SunTrust and First Union were
to agree on a surrender value for the First Union Option, First Union would
agree with Wachovia to terminate the First Union Merger Agreement. See
"Certain Information Concerning the First Union Option."

By voting against the Proposed First Union Merger, Wachovia
shareholders can demonstrate their support for the proposed combination of
SunTrust and Wachovia and send a strong message to the Wachovia Board that
they want to preserve the opportunity to consider the SunTrust Merger
Proposal.

While SunTrust is committed to helping Wachovia shareholders
realize the value of the SunTrust Merger Proposal, the SunTrust Merger
Proposal cannot go forward unless the Wachovia shareholders do not approve
the Proposed First Union Merger and the First Union Merger Agreement is
terminated. Accordingly, a vote for the Proposed First Union Merger could
leave Wachovia shareholders without a viable alternative to the Proposed
First Union Merger because SunTrust will not proceed with the SunTrust
Merger Proposal if the Proposed First Union Merger is approved by Wachovia
shareholders. However, there can be no assurance as to the occurrence or
timing of the termination of the First Union Merger Agreement or that the
conditions to the Proposed SunTrust Merger will be satisfied. As a result,
even if the Proposed First Union Merger is not approved by Wachovia
shareholders, Wachovia shareholders could still be without a viable
alternative to the Proposed First Union Merger if the conditions to the
Proposed SunTrust Merger are not satisfied.

REASONS TO VOTE AGAINST THE PROPOSED FIRST UNION MERGER

SunTrust urges you to vote your shares of Wachovia Common Stock
AGAINST the Proposed First Union Merger for the following reasons:

o A VOTE AGAINST THE PROPOSED FIRST UNION MERGER MOVES YOU
ONE STEP CLOSER TO RECEIVING A HIGHER PREMIUM AND BETTER
VALUE FOR YOUR SHARES PURSUANT TO THE SUNTRUST MERGER
PROPOSAL.

SunTrust believes that the combination of SunTrust and Wachovia is
financially superior to the Proposed First Union Merger and would provide
substantial benefits to Wachovia shareholders, including the following:

(1) Higher Premium. Based on May 25, 2001 closing prices, the
SunTrust Merger Proposal represents a premium of
approximately 4% over the implied value of the Proposed
First Union Merger. The amount of this premium will
fluctuate based on changes in the market prices of
SunTrust Common Stock and First Union Common Stock. We
note that as of May 25, 2001 the 52-week high closing
price for SunTrust Common Stock is $67.80, and the
52-week high closing price for Wachovia Common Stock is
$68.19.

(2) Stronger Currency. SunTrust has demonstrated stronger
stock price performance and delivered more attractive
total returns to its stockholders than First Union over
the past 1, 5 and 10-year periods. Through March 31,
2001, SunTrust produced one- year, five-year and ten-year
total returns to stockholders of 15.3%, 98.2% and 493.0%,
respectively. Based on historical results and First Call
consensus estimates for 2001, SunTrust's core earnings
per share reflect a five-year compounded annual growth
rate ("CAGR") of 12% from 1996 to 2001. A comparison of
the foregoing data to similar data for First Union is set
forth in the second table below.

(3) Simpler and Better Dividend. Under the SunTrust Merger
Proposal, SunTrust would increase the annual per share
dividend on its common stock to $2.22 so that Wachovia
shareholders would receive on a pro forma equivalent
basis the same $2.40 annual per share dividend that they
currently enjoy. SunTrust has had consistent dividend
growth (five-year CAGR of 14% in dividends per share, as
set forth in the second table below), has never cut its
dividend and has significant additional capacity to
increase its dividend.

We believe the dividend component of the
SunTrust Merger Proposal is simpler and better. We
believe it's simpler because you would not have to hold
any security other than your shares of SunTrust Common
Stock to receive the full dividend. We believe it's
better than First Union's one-time special dividend
alternative because, under that alternative, First Union
would have to increase its current dividend by 25% by the
beginning of the second year after its merger in order
for you to continue receiving the same per share dividend
you currently enjoy. And we believe the dividend
component of our proposal is better than First Union's
Preferred Stock Election Feature because you may not be
able to sell your preferred shares together with your
First Union common stock if the preferred shares are not
transferable or if a liquid market for the preferred
shares does not develop.

Dividends are payable on SunTrust Common Stock
when, as and if declared by the Board of Directors of
SunTrust. Accordingly, any declaration of dividends on
SunTrust Common Stock in the future will be at the
discretion of the SunTrust Board of Directors and will
depend upon SunTrust's future earnings and financial
condition and other factors. While SunTrust has not
reduced the dividend on its common stock at any time in
the past, there can be no assurance that SunTrust will
continue to pay dividends on SunTrust Common Stock in the
amounts set forth above or otherwise.

(4) Proven Execution Record. SunTrust believes it has a
proven track record of executing strategic initiatives.
SunTrust's successful integration of Crestar Financial
Corporation evidences its conservative and disciplined
approach to the execution of a major merger transaction
through setting achievable cost savings targets,
retaining a focus on customers and minimizing revenue
loss. Moreover, SunTrust has fully completed the
integration process on the Crestar acquisition and now
has a "clean slate" for purposes of allocating the
management resources necessary to execute a major merger
transaction.

While the Proposed SunTrust Merger would
represent a larger transaction than the Crestar
acquisition and would entail more in-market integration
than the Crestar acquisition, SunTrust believes it has
gained the expertise necessary for the integration of
Wachovia through its experience in the Crestar
transaction and other significant corporate projects. For
example, SunTrust has managed the consolidation of its 32
bank subsidiaries and its Y2K project, both of which
involved multiple large systems conversions. SunTrust's
bank consolidation project also has involved staff
realignment and reductions, customer and employee
retention programs and standardization of policies and
procedures among SunTrust's separate bank subsidiaries.
In the past year, SunTrust also has closed approximately
40 branches in the ordinary course of business, which
required transferring the customers of these
branches to other SunTrust retail locations. SunTrust
believes that through these experiences it has gained the
core project management and systems integration
competencies necessary to manage the integration effort
in connection with a combination with Wachovia. SunTrust
also believes there is an excellent cultural fit between
SunTrust and Wachovia and that the two companies'
business models and management philosophies are
compatible. SunTrust believes these factors should help
minimize the execution risk in combining SunTrust and
Wachovia.

SunTrust also does not believe that its proposed
merger with Wachovia poses any of the types of risks
perceived by some to be associated with "hostile"
transactions in the banking industry, most notably the
Wells Fargo/First Interstate merger. Based on previous
merger discussions with Wachovia over the years, SunTrust
knows Wachovia's operations well and is quite familiar
with its management and employees, its business and
operating structure, and its philosophy (see
"Background"), whereas Wells Fargo is reported to have
performed little or no due diligence prior to its
acquisition of First Interstate. SunTrust's integration
of Wachovia would be based on reasonable and conservative
assumptions and would take place over a reasonable time
period, while the Wells Fargo transaction was based on
aggressive cost savings targets and a nine-month
integration schedule. And SunTrust and Wachovia have
similar operational structures, while in the Wells Fargo
transaction Wells Fargo essentially undertook an overhaul
of First Interstate's entire approach to retail banking.

The table below compares key financial aspects of the SunTrust
Merger Proposal to those of the Proposed First Union Merger:

First Union/Wachovia SunTrust/Wachovia
-------------------------- --------------------

Implied Value (1)............................ $63.20 $65.62
Implied Ongoing Dividend Per
Wachovia Share............................... $2.40(2) $2.40(3)
Cost Savings / % Wachovia Core
Expense Base (4)............................. $890MM / 42% $500MM / 23%
Wachovia Pro Forma Ownership(5).............. 30% 44%

------------------------
(1) Based on closing prices on May 25, 2001.
(2) On May 22, 2001, First Union announced that it would provide
Wachovia shareholders the option to elect to receive, in addition
to the First Union Common Stock to be received in the Proposed
First Union Merger, either a one-time special dividend of $0.48
per share or preferred shares of First Union that would pay a
dividend that, when added to the dividends on the First Union
Common Stock, would be sufficient to provide Wachovia shareholders
with a $2.40 annual per share dividend on a pro forma equivalent
basis following completion of the Proposed First Union Merger.
First Union has not disclosed whether receipt of these preferred
shares would be taxable or whether these preferred shares will be
transferable.
(3) If the Proposed SunTrust Merger is consummated, SunTrust intends
to increase the annual dividend on its common stock to $2.22 per
share.
(4) Wachovia's estimated core expense base is pro forma to reflect the
impact of Wachovia's acquisition of Republic Security Financial
Corporation and Wachovia's pending transaction for the disposition
of its credit card operations. SunTrust estimates that its cost
savings will be phased in 40% in the first year following closing,
70% in the second year following closing and 100% in the third
year following closing. Wachovia has asserted in public
communications that Wachovia and SunTrust, during their December
merger discussions, had "agreed upon" $400 million in cost savings
in connection with a possible SunTrust/Wachovia merger. However,
Wachovia failed to disclose that it had advised SunTrust that
Wachovia believed that cost savings of more than $500 million were
obtainable in a SunTrust/Wachovia merger. See "Background."
(5) Based on common shares outstanding on 3/31/01.

The following table reflects certain historical financial and
stock performance data for SunTrust and First Union:

First Union SunTrust
-------------------- -------------------

1-Year Total Stockholder Return(1)........................................ (6.2%) 15.3%
5-Year Total Stockholder Return(1)........................................ 31.1% 98.2%
10-Year Total Stockholder Return(1)....................................... 376.5% 493.0%
5-Year Core Earnings Per Share CAGR(2).................................... (4)%(5) 12%
5-Year Net Revenue Per Share CAGR (3)..................................... 0%(5) 8%
5-Year Dividends Per Share CAGR(4)........................................ (3%)(5) 14%
Restructuring Charges--Last 5 Years(6)..................................... $7,210MM $365MM
First Quarter '01 Return on Assets (2).................................... 1.0% 1.2%
First Quarter '01 Return on Equity (2)(7)................................. 15.6% 19.5%
First Quarter '01 Efficiency Ratio(8)..................................... 62.8% 57.2%
First Quarter '01 Tangible Common Ratio(9)................................ 5.0% 6.8%

------------------------------
(1) Through March 31, 2001. Assumes reinvestment of dividends.
(2) Excludes restructuring and merger-related charges and other
non-recurring items. CAGR based on 1996 to 2001 actual and
estimated EPS based on Wall Street consensus estimates for 2001
(First Call).
(3) Excludes non-recurring items. CAGR based on 1996 to 2001, with
first quarter 2001 net
revenue per share annualized.
(4) CAGR based on 1996 to 2001, with first quarter 2001 dividend
annualized.
(5) Adjusted for 1997 2-for-1 stock split.
(6) Through March 31, 2001.
(7) SunTrust return on equity based on realized equity.
(8) Calculated as non-interest expense excluding amortization of
intangible and foreclosed property expenses, as a percentage of
fully-taxable equivalent net revenue excluding securities gains.
(9) Total equity less goodwill, divided by total assets less goodwill.

o A VOTE AGAINST THE PROPOSED FIRST UNION MERGER
WILL HELP SATISFY A CONDITION TO THE SUNTRUST
MERGER PROPOSAL.

One condition of the SunTrust Merger Proposal is that the Wachovia
shareholders do not approve the Proposed First Union Merger and the First
Union Merger Agreement is validly terminated. The Proposed SunTrust Merger
cannot go forward unless this condition is satisfied. Accordingly, your
vote against the Proposed First Union Merger can help to satisfy this
condition to the SunTrust Merger Proposal.

While SunTrust is committed to helping Wachovia shareholders
realize the value of the SunTrust Merger Proposal, the SunTrust Merger
Proposal cannot go forward unless the Wachovia shareholders do not approve
the Proposed First Union Merger and the First Union Merger Agreement is
validly terminated. Accordingly, a vote for the Proposed First Union Merger
could leave Wachovia shareholders without a viable alternative to the
Proposed First Union Merger because SunTrust will not proceed with the
SunTrust Merger Proposal if the Proposed First Union Merger is approved by
Wachovia shareholders. However, there can be no assurance as to the
occurrence or timing of the termination of the First Union Merger Agreement
or that the conditions to the Proposed SunTrust Merger will be satisfied.
As a result, even if the Proposed First Union Merger is not approved by
Wachovia shareholders, Wachovia shareholders could still be without a
viable alternative to the Proposed First Union Merger if the conditions to
the Proposed SunTrust Merger are not satisfied.

o A VOTE AGAINST THE PROPOSED FIRST UNION MERGER SENDS A
STRONG MESSAGE TO THE WACHOVIA BOARD OF DIRECTORS THAT
YOU WANT TO PRESERVE THE OPPORTUNITY TO ACCEPT THE
SUNTRUST MERGER PROPOSAL.

By voting against the Proposed First Union Merger, Wachovia
shareholders can demonstrate their support for the proposed combination of
Wachovia and SunTrust. A vote against the Proposed First Union Merger moves
Wachovia shareholders closer to being able to benefit from the SunTrust
Merger Proposal. On the other hand, if Wachovia shareholders approve the
Proposed First Union Merger, it is likely that the Proposed First Union
Merger will be consummated.

YOU CAN TAKE IMMEDIATE STEPS TO HELP OBTAIN
GREATER VALUE FOR YOUR SHARES

(1) Return your [BLUE] proxy and vote AGAINST the Proposed
First Union Merger; and

(2) Make your views known to the Wachovia Board of Directors.

BY TAKING THESE STEPS, YOU WILL GIVE THE WACHOVIA BOARD OF DIRECTORS A
CLEAR MESSAGE THAT THEY SHOULD TAKE ALL NECESSARY ACTIONS TO REMOVE ALL
OBSTACLES TO THE SUNTRUST MERGER PROPOSAL.

BACKGROUND

From time to time in the past, SunTrust and Wachovia have engaged
in discussions concerning the possibility of a business combination
transaction between the parties. Discussions were initiated between the
parties most recently in early November of 2000, at a meeting in Atlanta
between L. Phillip Humann, Chairman, President and Chief Executive Officer
of SunTrust, and L.M. Baker, Jr., the Chairman, President and Chief
Executive Officer of Wachovia, at which Messrs. Humann and Baker discussed
the possibility of a business combination transaction between SunTrust and
Wachovia. Later that month, John W. Spiegel, Chief Financial Officer of
SunTrust, and Robert S. McCoy, Chief Financial Officer and Treasurer of
Wachovia, discussed matters relative to a potential business combination
transaction between the parties, including revisiting previous discussions
between them in 1997 regarding the financial aspects and benefits of a
combination of SunTrust and Wachovia, including the cost savings that
should be obtainable in such a combination. Messrs. Spiegel and McCoy
mutually agreed that, based on those discussions, there was no reason that
the parties should not proceed with their consideration of a transaction.

On December 2, 2000, Mr. Spiegel met with several members of
senior management of Wachovia to establish a plan for conducting due
diligence and information sharing between the parties. That weekend,
representatives of SunTrust and Wachovia and their respective financial and
legal advisors commenced their due diligence investigations in connection
with the proposed transaction. These due diligence efforts continued on an
ongoing basis throughout the next couple of weeks and included meetings
between key members of senior management of the two companies, several
off-site meetings involving large due diligence teams and the continuous
exchange of information between the two companies. Also during this time,
SunTrust and Wachovia and their respective legal advisors substantially
negotiated the terms of the proposed transaction and the draft merger
documents, and representatives of SunTrust and Wachovia, with the
assistance of their respective financial advisors, prepared an analyst
presentation for purposes of describing the transaction to the investment
community. SunTrust and Wachovia had set December 18, 2000 as the targeted
announcement date of the proposed transaction.

With a few days remaining before the targeted announcement date,
the following material terms of the transaction had been agreed to:

Name: Wachovia

Headquarters: Atlanta, Georgia

Price: 1.03 SunTrust shares per Wachovia share (12%
premium based on 12/15/00 closing prices)

Board: 50/50 split between SunTrust and Wachovia
directors

Management: Chairman and CEO: L.M. Baker, Jr. - CEO until
2003 Annual Meeting and Chairman until 2004 Annual
Meeting

President and COO: L. Phillip Humann - to become
CEO at 2003 Annual Meeting and Chairman at 2004
Annual Meeting

Other management roles and individuals from
SunTrust and Wachovia to fill those roles had
been identified

Dividend: SunTrust dividend increase to ensure no reduction
in dividends to Wachovia shareholders on a pro
forma equivalent basis

Over the course of the discussions, Mr. Baker communicated only
one area of concern to Mr. Humann relative to the compatibility of the two
companies. Mr. Baker indicated to Mr. Humann that the specialists in
Wachovia's wealth management business (tax and estate planning, portfolio
managers, etc.) reported to a centralized business unit whereas SunTrust's
wealth management specialists reported on the basis of geography. Mr.
Humann indicated that SunTrust had in effect dual reporting lines, both on
the basis of geography and to a centralized business unit which set and
implemented overall policy with respect to uniform practices and standards.
Mr. Humann advised Mr. Baker that he did not believe there was a practical
difference in how these specialists functioned on a day-to-day basis, but
nevertheless advised Mr. Baker that SunTrust was prepared to shift to
Wachovia's operating structure for the wealth management business. Mr.
Baker also questioned the proposed reporting line of the wealth management
business, preferring that this business unit report to Mr. Humann as the
proposed president and chief operating officer instead of to a vice
chairman to whom multiple business lines would report. Mr. Humann advised
Mr. Baker that SunTrust's position on this issue was based on SunTrust's
view that the wealth management business can benefit greatly through
interaction with other business lines, and that SunTrust had realized
substantial success with this approach.

Late in the morning on December 14, 2000, Mr. Baker telephoned Mr.
Humann and advised him that Wachovia was withdrawing from further
discussions based on the issue raised by Mr. Baker with respect to the
reporting relationship of the combined company's wealth management
business. Messrs. Humann and Baker decided to speak again after their
respective Board of Directors meetings which had been scheduled for the
following afternoon.

On December 15, 2000, following their respective Board of
Directors meetings, Mr. Humann and Mr. Baker spoke again, but Mr. Baker
indicated that he did not want to take up the merger discussions again
until some time after the holidays. Mr. Humann concluded that the prospect
for a constructive dialogue with Mr. Baker concerning a potential business
combination would be improved if he allowed some amount of time to elapse
before resuming Merger discussions with Mr. Baker, and accordingly
determined not to contact Mr. Baker immediately following the holidays. In
early February 2001, following the announcement by Wachovia of its plans to
initiate an evaluation of strategic alternatives for its credit card
business, Mr. Humann decided, in light of the fact that a sale of the
credit card business would be a significant transaction for Wachovia, that
he would not attempt to resume discussions with Mr. Baker until Wachovia
had completed that process.

On April 13, 2001, Mr. Humann learned of rumors that Wachovia was
in merger negotiations with First Union. At that time, members of
SunTrust's senior management contacted representatives of SunTrust's legal
and financial advisors to assist SunTrust in evaluating its alternatives
(principally whether or not to submit a merger proposal to Wachovia) in
light of the possibility that Wachovia was in merger negotiations with
First Union.

On April 14, 2001, Mr. Humann telephoned Mr. Baker, and Mr.
Spiegel telephoned Mr. McCoy, to inquire as to whether Wachovia was engaged
in merger discussions with First Union, and, in the event that Wachovia
confirmed these discussions, to deliver a merger proposal to Wachovia. At
the same time, members of SunTrust's senior management and its legal and
financial advisors prepared a letter to be delivered to Wachovia in the
event that the responses to the inquiries made by Messrs. Humann and
Spiegel confirmed that First Union and Wachovia were in discussions.

Mr. Spiegel spoke by telephone with Mr. McCoy, who confirmed that
he was also aware of the rumors. Mr. Spiegel reminded Mr. McCoy of
SunTrust's interest in a business combination transaction with Wachovia,
and Mr. McCoy acknowledged that he was aware of SunTrust's interest. Later
in the day, Mr. Humann reached Mr. Baker, who acknowledged his awareness of
the rumors but attributed them to internet message boards and chat rooms
and pointed out that these same message boards and chat rooms had similar
rumors concerning a transaction between SunTrust and Wachovia. Mr. Humann
then stated that the two of them had agreed that they would be getting
together again to resume their discussions from December, and Mr. Baker
confirmed that this was what they had agreed to. Mr. Humann understood Mr.
Baker's response to be an indication that Wachovia was not in discussions
with First Union.

On April 16, 2001, First Union and Wachovia jointly announced that
they had entered into a low-premium, merger-of-equals transaction. See
"Certain Information Concerning the Proposed First Union Merger."

During the weeks following the announcement of the Proposed First
Union Merger, members of senior management of SunTrust, with the advice and
assistance of its legal and financial advisors, periodically met to discuss
SunTrust's alternatives in light of the announcement of the Proposed First
Union Merger.

On May 11, 2001, the SunTrust Board of Directors unanimously
approved the SunTrust Merger Proposal and related matters.

On May 14, 2001, SunTrust delivered the following letter to the
Board of Directors of Wachovia:

[LETTERHEAD OF SUNTRUST BANKS, INC.]

May 14, 2001

The Board of Directors
Wachovia Corporation
100 North Main Street
Winston-Salem, North Carolina 27150

Dear Members of the Board:

As you know, we have long been interested in a business
combination with Wachovia Corporation. We have enormous respect for all of
you, many of whom are well acquainted with members of our Board, and we
have always been impressed with the quality of Wachovia's management with
whom we have developed excellent relationships over the years. Our
respective management philosophies and corporate cultures are highly
compatible, and we both share a commitment to superior customer service and
relationship-based banking that sets us apart from our competitors.

Since the announcement of your proposed merger with First Union
Corporation, we have again given serious consideration to a combination of
SunTrust and Wachovia. By this letter, we are proposing a transaction that
provides superior value to Wachovia's shareholders. We remain convinced
that a combination of our companies is a compelling transaction in light of
the strategic and financial benefits for each of us and our respective
shareholders. Our proposal provides Wachovia's shareholders a significant
premium over both Wachovia's current market price and the current value of
the First Union transaction. Our proposal also maintains Wachovia's current
dividend and provides Wachovia shareholders with an investment in SunTrust,
a high quality, high performing company. We believe our offer is a
"Superior Proposal" as that term is defined under your merger agreement
with First Union. Accordingly, we would like to meet with you as soon as
possible to discuss the terms of our offer in greater detail.

Under our proposal, Wachovia and SunTrust would combine in a
merger in which each share of common stock of Wachovia would be converted
into 1.081 shares of SunTrust common stock, having an implied value of
$70.06 per Wachovia share. Based on May 11, 2001 closing prices, our offer
represents a 17% premium over the implied value of your proposed merger
with First Union and a 15% premium over Wachovia's closing price. SunTrust
also would increase its annual per share dividend to $2.22 so that Wachovia
shareholders would receive on a pro forma equivalent basis the same $2.40
annual per share dividend that they currently enjoy. Our transaction would
be tax-free to Wachovia shareholders and would be accounted for as a
purchase. Completion of the merger would require receipt of regulatory and
shareholder approvals and the satisfaction of other customary conditions.
We have attached a brief financial presentation outlining the significant
financial benefits of our proposal.

We would propose that the board of directors of the combined
company include appropriate representation from Wachovia's current board of
directors. In addition, we would anticipate leadership roles for numerous
members of Wachovia's management, and we would anticipate putting in place
appropriate incentives and retention arrangements for key members of
management of Wachovia. While the headquarters of the combined company
would be in Atlanta, Georgia, we are prepared to make Winston-Salem the
headquarters for our Carolinas bank, and we would maintain meaningful
operations there. Our proposal is also more attractive for your employees
in North and South Carolina, where we would anticipate substantially fewer
job losses than under your proposed merger with First Union.

We believe the strategic rationale for combining SunTrust and
Wachovia is compelling for a number of reasons, including the following:

o Shared focus on superior customer service and
relationship-based banking;
o Leadership position in high growth and affluent
southeastern geographic markets;
o Enhanced scale in high growth/high margin businesses;
o SunTrust has clean slate to execute transaction;
o Superior financial strength and credit risk management;
and
o Opportunity for reinvestment of excess capital.

A merger of SunTrust and Wachovia would combine two companies that
possess highly compatible operating philosophies and corporate cultures, a
similar management structure and a shared commitment to operating a
customer relationship-based financial services franchise. Both SunTrust and
Wachovia have a matrix management structure which is based on both business
lines and geography. Both companies provide significant autonomy to local
managers who best understand and manage local customer relationships. For
these reasons, we believe the integration of our businesses can be
accomplished in a virtually seamless manner with no meaningful customer
loss or disruption.

Most important for Wachovia's shareholders is the strength of
SunTrust's currency. SunTrust has demonstrated consistently strong stock
price performance and has delivered attractive total returns to its
shareholders. Based on last Friday's closing stock price, SunTrust has
produced a five-year total return to shareholders of 100%, and, based on
First Call consensus estimates for 2001, SunTrust's core earnings per share
will produce a five-year CAGR of 12% from 1996-2001. SunTrust has had
consistent dividend growth (5-year CAGR of 14% in dividends per share), has
never cut its dividend and has significant additional capacity to increase
its payout ratio. As noted above, our proposal provides that SunTrust would
increase its dividend to ensure no dividend reduction for Wachovia
shareholders.

In addition to strong performance and a focused strategy, the
strength of our currency derives from prudent management practices.
SunTrust has never had to pre-announce an earnings shortfall or major
write-down and, other than the $115 million loss taken in 1999 in
connection with repositioning its securities portfolio, has never taken a
restructuring charge that was not merger- related. We have retained an
ongoing focus on credit and risk management. Our five-year average net
charge-off ratio is the lowest among the twenty largest U.S. banks at
0.29%.* Additionally, our holding company currently enjoys A1/A+ ratings
from Moody's and S&P, respectively, for its long- term unsecured debt, with
a positive outlook from Moody's and a stable outlook from S&P, and our bank
carries Aa3/AA- ratings from Moody's and S&P, respectively.

-------------------
* Largest twenty banks by market capitalization, excluding Northern
Trust Corporation and State Street Corporation, as these banks
have business lines that are materially different from those of
the other banks in the group.

With respect to executing strategic transactions, SunTrust has a
superior track record. Our integration of Crestar Financial Corporation is
regarded as a successful execution of a major bank merger transaction. All
significant operations were smoothly integrated, with virtually no
measurable customer run-off or revenue loss. This is in stark contrast to
the history of the mergers integrated by many of our competitors. Moreover,
because of the excellent strategic fit between SunTrust and Wachovia and
our consistent business models, and based on our previous discussions, we
believe there is limited execution risk in combining SunTrust and Wachovia.
It bears noting that our cost saving estimates project 3,000 fewer staff
reductions and approximately 125-150 fewer branch closures than the First
Union transaction -- figures which suggest materially less execution risk
in connection with our proposal.

Our interest in this transaction is a reflection of our firm
belief that a combination of our companies would be highly beneficial
financially to both of our shareholder groups and accretive to SunTrust's
earnings per share. In sum, we believe our proposal is superior to your
proposed transaction with First Union based on its higher current value,
maintenance of the Wachovia dividend and the opportunity for Wachovia
shareholders to share in the earnings accretion deriving from a stronger
combined franchise.

Our proposal requires the valid termination of your merger
agreement with First Union, and we are filing preliminary proxy materials
with the SEC today to enable us to seek proxies from the Wachovia
shareholders to vote against the First Union transaction. The stock option
you granted to First Union contains several excessive and unprecedented
features, and we reserve the right to challenge the validity of that
option. Nevertheless, in the interest of facilitating a transaction, our
proposal assumes a payment to First Union of the "in-the-money" value of
the option, subject to the cap set forth in the option agreement. Our
proposal also requires an update and completion of the due diligence
investigation we performed in December.

We were both disappointed and surprised by the announcement of
your proposed merger. We were disappointed because we (and, we believe, the
market) are convinced that a merger of our companies is a better fit and
provides more compelling strategic benefits than your proposed transaction
with First Union. And we were surprised because Wachovia did not make any
effort to revisit the substantially completed merger negotiations that we
conducted this past December. As you no doubt recall, our then-proposed
merger was put on hold only days before it was to be announced. The
transaction documents, including employment agreements, were essentially in
final form; due diligence was substantially completed; and our financial
advisors were working to finalize the investor presentation. It bears
noting that the pricing we agreed to in December, which represented a 12%
premium to Wachovia's then-current market price and included an increase in
SunTrust's dividend to preserve Wachovia's dividend on a pro forma
equivalent basis, would have provided greater value to Wachovia's
shareholders than the value to be received in the First Union transaction.
In any event, because of all the work that was done in December, we are
extremely confident that we can reach definitive terms with you, as well as
update and complete our due diligence, expeditiously.

My clear recollection is that our December transaction was put on
hold by Wachovia solely because of concerns over two issues relating to the
organization of the combined company's wealth management line of business.
One of the issues concerned the reporting structure of the specialists
(i.e., tax and estate planning, portfolio management, etc.) within that
business. At SunTrust, the specialists in effect have dual reporting on the
basis of geography and to a centralized unit (to implement uniform
standards, investment policy and the like), whereas at Wachovia the
specialists report only to a centralized business unit. As a practical
matter, we do not believe these businesses function very differently on a
day-to-day basis, and the difference in organizational structure does not
in our view pose any particularly difficult integration issues.
Importantly, I had advised Wachovia at the time that we were prepared to
accept your operating structure for this business line. The second issue
concerned the reporting relationship of the wealth management business --
whether this business should report to a vice-chairman to whom multiple
business lines would be reporting (which was SunTrust's preference), or to
me as president and chief operating officer, as Wachovia proposed.
SunTrust's position on this issue was based upon our view that the wealth
management line can benefit greatly through interaction with other lines of
business, and our success in this area has demonstrated this. At any rate,
this too appeared to us to be an eminently solvable issue.

In all events, we are confident that we can implement an approach
to operating the wealth management business on a combined basis that
captures the best features of both SunTrust and Wachovia.

The Board of Directors of SunTrust has unanimously approved this
proposal and has authorized our management team to proceed. We have engaged
Morgan Stanley; Skadden, Arps, Slate, Meagher & Flom LLP; and King &
Spalding to advise us in this transaction.

We would like to meet with you as soon as possible to discuss our
proposal in greater detail. Please feel free to contact me at my office
number or to have your respective financial or legal advisors contact Bill
Weiant of Morgan Stanley or Bill Rubenstein of Skadden Arps regarding the
matters set forth herein. We look forward to meeting with you soon.

Sincerely,

/s/ L. Phillip Humann

L. Phillip Humann

Also on May 14, 2001 SunTrust issued a press release announcing
the SunTrust Merger Proposal and conducted an investor presentation which
discussed the SunTrust Merger Proposal in detail.

On May 15, 2001, Theodore J. Hoepner, a shareholder of Wachovia, a
participant in this proxy solicitation and a Vice Chairman of SunTrust,
delivered a letter to Wachovia demanding certain corporate records and
documents of Wachovia pursuant to his rights under the North Carolina
Business Corporation Act and North Carolina common law. As of the date of
this Proxy Statement, Wachovia has not complied with Mr. Hoepner's demand.

On May 18, 2001, Mr. Baker announced that the First Union Merger
Agreement had been amended so as to delete any increase in retirement
compensation for Mr. Baker in connection with the Proposed First Union
Merger.

On May 22, 2001, First Union announced the Preferred Stock
Election Feature. On the same day, Wachovia issued a press release
announcing that its board of directors had rejected the SunTrust Merger
Proposal and had reaffirmed its commitment to the Proposed First Union
Merger. According to an article in The Wall Street Journal on May 24, 2001,
Morris Offit, a Wachovia director, dissented from the decision of the
Wachovia Board to reject the SunTrust Merger Proposal. According to that
article, people familiar with the meeting said that when it came time for
the Wachovia Board of Directors to vote, Mr. Offit explained he would not
reject the SunTrust Merger Proposal because he liked the SunTrust business
model and thought the cultural compatibility of SunTrust and Wachovia was
better than that of First Union and Wachovia. Mr. Offit also reportedly
raised concerns earlier in the meeting about whether Wachovia management
and its advisers had adequately disclosed details of SunTrust's overtures.
Mr. Offit, a Wachovia director, employee and significant shareholder,
joined the Wachovia Board of Directors in 1999 after selling his New York
trust bank, Offitbank Holdings Inc., to Wachovia. Mr. Offit currently owns
directly or indirectly 489,201 Wachovia shares, making him by far the
largest shareholder among Wachovia's directors.

In a letter to Wachovia shareholders dated May 22, 2001, Mr. Baker
made four allegations regarding the SunTrust Merger Proposal: (1) a
combined SunTrust/Wachovia will not provide adequate future earnings
growth, (2) there is serious implementation risk in the SunTrust Merger
Proposal, (3) the SunTrust Merger Proposal does not compensate Wachovia
shareholders for SunTrust's inadequate future earnings growth and serious
implementation risk, and (4) there is no dividend advantage to the SunTrust
Merger Proposal.

On May 22, 2001, Mr. Baker sent a letter to the SunTrust Board in
which he expressed Wachovia's disappointment at what he perceived to be
SunTrust's efforts to take over Wachovia and asked SunTrust to respect the
Wachovia Board's decision rejecting the SunTrust Merger Proposal and to
withdraw the SunTrust Merger Proposal.

On the evening of May 22, 2001, SunTrust issued a press release
indicating that it was disappointed by the decision of the Wachovia Board
to reject the SunTrust Merger Proposal and that it would continue with its
plan to solicit Wachovia shareholders to vote against the Proposed First
Union Merger. The press release also announced that SunTrust was initiating
litigation in state and federal court in Georgia. See "Certain Litigation."
Also on May 22, 2001, First Union initiated litigation against SunTrust in
state court in North Carolina. See "Certain Litigation."

IMPORTANT

IF YOU WANT TO HAVE THE OPPORTUNITY TO CONSIDER THE PROPOSED
SUNTRUST MERGER WE URGE YOU TO PROMPTLY SIGN, DATE AND MAIL THE ENCLOSED
[BLUE] PROXY TO VOTE AGAINST THE PROPOSED FIRST UNION MERGER. WE URGE YOU
TO EXECUTE AND MAIL THE [BLUE] PROXY CARD AS SOON AS POSSIBLE.

REJECTION OF THE PROPOSED FIRST UNION MERGER IS A CRITICAL STEP IN
SECURING THE SUCCESS OF THE SUNTRUST MERGER PROPOSAL.

EVEN IF YOU HAVE ALREADY SENT A PROXY TO THE BOARD OF DIRECTORS OF
WACHOVIA, YOU HAVE EVERY RIGHT TO CHANGE YOUR VOTE. YOU MAY REVOKE THAT
PROXY AND VOTE AGAINST THE PROPOSED FIRST UNION MERGER BY SIGNING, DATING
AND MAILING THE ENCLOSED [BLUE] PROXY IN THE ENCLOSED ADDRESSED ENVELOPE.
NO POSTAGE IS NECESSARY IF YOUR PROXY IS MAILED IN THE UNITED STATES.

CERTAIN INFORMATION CONCERNING THE PROPOSED FIRST UNION MERGER

On April 15, 2001, First Union and Wachovia entered into the First
Union Merger Agreement. The First Union Merger Agreement provides for a
merger of Wachovia with and into First Union pursuant to which each
outstanding share of Wachovia Common Stock would be converted into 2.0
shares of First Union common stock. On May 22, 2001, First Union announced
that it is offering to Wachovia shareholders two alternatives that purport
to guarantee that their dividend payments will remain at the current
Wachovia level of $2.40 per share per annum. In connection with the
Proposed First Union Merger, Wachovia shareholders would have the option to
receive, in addition to two shares of First Union Common Stock, either (1)
a one-time payment at closing of $0.48 per Wachovia share (as previously
contemplated by the Proposed First Union Merger), or (2) shares of
preferred stock (the "Preferred Shares") that would pay quarterly dividends
in an amount equal to the difference between Wachovia's current quarterly
per share dividend and the pro forma equivalent quarterly dividend per
Wachovia share paid on the common stock of the combined Wachovia/First
Union. Specifically, the new second alternative would provide Wachovia
shareholders with two Preferred Shares, each of which would initially pay a
quarterly cash dividend of $0.06 per share, so that Wachovia shareholders
who elect this alternative would receive, on a pro forma equivalent per
share basis, $0.48 in quarterly dividends on First Union common stock and
$0.12 in quarterly dividends on the Preferred Shares, or the same $0.60
quarterly dividend per share currently paid by Wachovia. The dividend on
the Preferred Shares would decline as the common dividend of the new
Wachovia/First Union increases, until the new entity's common dividend
equals or exceeds $1.20 per share (or $2.40 per Wachovia share on a pro
forma equivalent basis). No further details as to the other terms of the
Preferred Shares have been disclosed by First Union or Wachovia as of the
date of this Proxy Statement, including whether the receipt of the
Preferred Shares would be taxable or whether the Preferred Shares are
transferable.

The obligations of Wachovia and First Union to complete the
Proposed First Union Merger are subject to various conditions, including
the approval of the stockholders of First Union and Wachovia, receipt of
all required regulatory approvals without any conditions that could have a
material adverse effect on the combined company, and the satisfaction of
other customary closing conditions.

The foregoing description of the First Union Merger Agreement is
not complete and is qualified in its entirety by reference to the full text
of the First Union Merger Agreement, a copy of which has been included as
an Annex to the Joint Proxy Statement-Prospectus.

CERTAIN INFORMATION CONCERNING THE FIRST UNION OPTION

In connection with the execution of the First Union Merger
Agreement, Wachovia and First Union also entered into the First Union
Option, pursuant to which First Union has the right, upon the occurrence of
certain events, to purchase up to 19.9% of the issued and outstanding
shares of Wachovia Common Stock at the close of business on April 12, 2001,
at a price per share of $59.482, subject to certain adjustments.

First Union may exercise the First Union Option if both an
"initial triggering event" and a "subsequent triggering event" occur prior
to the occurrence of an event that would terminate the First Union Option.
An initial triggering event will occur if the Wachovia shareholders fail to
approve the Proposed First Union Merger at the Annual Meeting. An initial
triggering event also will occur when SunTrust files its application under
the Bank Holding Company Act for Federal Reserve Board approval of the
Proposed SunTrust Merger. A subsequent triggering event will occur if any
person acquires beneficial ownership of 25% or more of the outstanding
voting securities of Wachovia or if Wachovia enters into an agreement with
respect to, or the Wachovia Board otherwise recommends that the Wachovia
shareholders approve or accept, any transaction with a third party (other
than First Union) involving a merger or consolidation of, or a sale of more
than 25% of the business, assets or deposits of, or a purchase or other
acquisition of securities constituting more than 25% of the voting power
of, Wachovia or any of its subsidiaries. The execution by Wachovia of a
definitive agreement providing for the Proposed SunTrust Merger would
constitute a subsequent triggering event and would result in the First
Union Option becoming exercisable.

Upon the occurrence of a "Repurchase Event" as defined in the
First Union Option, upon the request of First Union, Wachovia would be
required to repurchase from First Union the First Union Option and any
shares issued under the First Union Option. The repurchase price is
determined pursuant to a formula that is generally designed to capture the
difference in value between (i) the $59.482 exercise price per share of the
First Union Option and (ii) the highest of (a) the price at which a tender
or exchange offer has been made, (b) the price per share of Wachovia common
stock to be paid by a third party pursuant to an agreement with Wachovia
and (c) the highest closing price of Wachovia common stock within the
six-month period immediately preceding the date that the holder of the
First Union Option gives notice to Wachovia of its desire to have Wachovia
repurchase the First Union Option. Such difference in value, multiplied by
the number of shares of Wachovia Common Stock subject to the First Union
Option, is the repurchase price for the First Union Option (the "Repurchase
Formula"). In addition, upon the occurrence of a Repurchase Event, First
Union may surrender the First Union Option and any shares issued under the
First Union Option held by First Union for a cash fee equal to $375 million
(the "Minimum Surrender Value"), reduced correspondingly if there have been
purchases of stock under the First Union Option and gains on the sale of
such stock.

The First Union Option provides that First Union's "total profit"
may not exceed $780 million. The term "total profit" is defined in the
First Union Option as "the aggregate amount (before taxes) of the
following: (1) the excess of (A) the net cash amounts or fair market value
of any property received by [the holder of the First Union Option] pursuant
to the sale of Option Shares (or any other securities into which such
Option Shares are converted or exchanged) to any unaffiliated party, other
than any amount received by [the holder of the First Union Option] upon the
repurchase of Option Shares by [Wachovia] pursuant to Section 7, after
payment of applicable brokerage or sales commissions and discounts, over
(B) [the holder of the First Union Option]'s aggregate purchase price for
such Option Shares (or other securities), plus (2) all amounts received by
[the holder of the First Union Option] upon the repurchase of the Option by
[Wachovia] pursuant to Section 7, plus (3) all equivalent amounts with
respect to the Substitute Option and any amounts paid pursuant to Section
9, minus (4) all amounts of cash previously paid to [Wachovia] pursuant to
Section 16(a)(3) and the value of all Option Shares (or other securities)
previously delivered to [Wachovia] for cancellation pursuant to Section
16(a)(2), which value shall be deemed to be the purchase price by
[Wachovia] for such Option Shares or other securities." SunTrust believes
that the "total profit" provisions do not operate to limit the value of the
First Union Option to $780 million in all circumstances. For example, while
clause (2) would take into account the value realized by First Union on a
repurchase by Wachovia of the First Union Option, clause (1) specifically
provides that value realized by First Union as a result of the repurchase
by Wachovia of shares of Wachovia Common Stock acquired upon exercise of
the First Union Option is not to be taken into account in calculating the
"total profit".

The SunTrust Merger Proposal is subject to certain conditions,
including the First Union Option Condition. To satisfy the First Union
Option Condition, either the First Union Option must be judicially
invalidated or First Union must surrender the First Union Option for a cash
payment equal to the in-the-money value of the First Union Option, subject
to the Minimum Surrender Value of $375 million and the purported "cap" of
$780 million. For purposes of the First Union Option Condition, SunTrust
regards the in-the-money value of the First Union Option as equivalent to
the value that would be determined under the Repurchase Formula. Because
SunTrust has neither executed an agreement with Wachovia to acquire any
shares of Wachovia Common Stock nor commenced an exchange offer to purchase
shares of Wachovia Common Stock, the relevant price for purposes of the
Repurchase Formula would be the highest closing price of Wachovia Common
Stock during the six-month period preceding the date that the holder of the
First Union Option gives notice to Wachovia of its desire to have Wachovia
repurchase the First Union Option. SunTrust believes the highest closing
price of Wachovia Common Stock during the six-month period preceding the
date of this Proxy Statement is $68.1875. Accordingly, for purposes of the
First Union Option Condition, the in-the-money value of the First Union
Option as of the date of this Proxy Statement based on the Repurchase
Formula is approximately $364 million ($68.1875 minus the exercise price of
$59.482, multiplied by the approximately 41.8 million shares of Wachovia
common stock subject to the First Union Option). Because the Minimum
Surrender Value of the First Union Option is $375 million, which is higher
than the value of the First Union Option based on the Repurchase Formula,
the in-the-money value of the First Union Option for purposes of the First
Union Option Condition as of the date of this Proxy Statement is $375
million.

In the event Wachovia was willing to enter into a definitive
agreement with SunTrust with respect to the SunTrust Merger Proposal, and
the implied value of the SunTrust Merger Proposal per share of Wachovia
Common Stock at that time was higher than the highest closing price of
Wachovia Common Stock during the preceding six-month period, then SunTrust
would calculate the in-the-money value of the First Union Option for
purposes of the First Union Option Condition based on the higher implied
value of the SunTrust Merger Proposal. For example, if the implied value of
the SunTrust Merger Proposal per share of Wachovia Common Stock were $70 at
the time Wachovia was willing to enter into a definitive agreement with
SunTrust with respect to the SunTrust Merger Proposal, the value of the
First Union Option based on the Repurchase Formula would be approximately
$440 million. Because $440 million is more than the Minimum Surrender Value
of $375 million and less than the purported "cap" of $780 million, the
in-the-money value of the First Union Option for purposes of the First
Union Option Condition would be $440 million. As noted above, because the
exchange ratio in the SunTrust Merger Proposal is fixed, the implied value
of the SunTrust Merger Proposal will fluctuate based on changes in the
market prices for SunTrust Common Stock. In addition, the highest closing
price of Wachovia's Common Stock on a trailing six-months basis will vary
over time. Accordingly, the in-the-money value of the First Union Option
for purposes of the First Union Option Condition will fluctuate. As a
practical matter, if Wachovia's shareholders do not approve the Proposed
First Union Merger and Wachovia enters into merger discussions with
SunTrust, SunTrust believes that it and First Union would enter into
negotiations with respect to the appropriate surrender value of the First
Union Option. However, there can be no assurance that First Union would
enter into any such negotiations or that the parties would agree on the
appropriate surrender value of the First Union Option.

In connection with the execution of the First Union Merger
Agreement, Wachovia and First Union also entered into a Stock Option
Agreement pursuant to which First Union granted Wachovia an option (the
"Wachovia Option") to purchase up to 19.9% of the issued and outstanding
shares of First Union Common Stock at the close of business on April 12,
2011, at a price per share of $31.892, subject to certain adjustments. The
terms of the Wachovia Option are substantially the same as the terms of the
First Union Option.

The foregoing description of the First Union Option and the
Wachovia Option is not complete and is qualified in its entirety by
reference to the full text of the First Union Option and the Wachovia
Option, copies of which have been included as annexes to the Joint Proxy
Statement- Prospectus.

REGULATORY APPROVALS REQUIRED FOR THE PROPOSED SUNTRUST MERGER

The completion of the Proposed SunTrust Merger will be conditioned
on obtaining all regulatory approvals required for the merger and the
expiration of all applicable waiting periods with respect thereto. These
approvals and the expiration of any statutory waiting periods related to
these approvals are referred to herein as the "requisite regulatory
approvals." These include approval from the Federal Reserve Board and
various state regulatory authorities. SunTrust intends to complete the
filing as promptly as practicable after the date of this Proxy Statement of
all applications and notifications required to obtain the requisite
regulatory approvals. The Proposed SunTrust Merger cannot be consummated in
the absence of the requisite regulatory approvals. SunTrust cannot assure
Wachovia shareholders as to whether or when the requisite regulatory
approvals will be obtained, and, if obtained, SunTrust cannot assure
Wachovia shareholders as to the date of receipt of any of these approvals
or the absence of any litigation challenging them. Likewise, SunTrust
cannot assure Wachovia shareholders that the United States Department of
Justice (the "DOJ") or a state attorney general will not attempt to
challenge the Proposed SunTrust Merger on antitrust grounds, or, if such a
challenge is made, as to the result of that challenge.

SunTrust is not aware of any other material governmental approvals
or actions that are required prior to the consummation of the Proposed
SunTrust Merger other than those described below. SunTrust presently
contemplates that if any additional governmental approvals or actions are
required, these approvals or actions will be sought. However, SunTrust
cannot assure Wachovia shareholders that any of these additional approvals
or actions will be obtained.

Federal Reserve Board. The Proposed SunTrust Merger is subject to
approval by the Federal Reserve Board under the Bank Holding Company Act.
Assuming the Federal Reserve Board approves the Proposed SunTrust Merger,
the merger may not be consummated for 30 days, during which time the DOJ
may challenge the merger on antitrust grounds and seek divestiture of
certain assets and liabilities. With agreement of the Federal Reserve Board
and the DOJ, this waiting period may be reduced to no fewer than 15 days.

The Federal Reserve Board is prohibited from approving any
transaction under the applicable statutes that would result in a monopoly,
or that would be in furtherance of any combination or conspiracy to
monopolize, or to attempt to monopolize, the business of banking in any
part of the United States, or that may have the effect in any section of
the United States of substantially lessening competition, or tending to
create a monopoly, or resulting in a restraint of trade, unless the Federal
Reserve Board finds that the anti-competitive effects of the transaction
are clearly outweighed in the public interest by the probable effect of the
transaction in meeting the convenience and needs of the communities to be
served.

Also, in reviewing a transaction under the Bank Holding Company
Act, the Federal Reserve Board will consider the financial and managerial
resources of SunTrust and Wachovia and their respective subsidiary banks
and the convenience and needs of the communities to be served. As part of
its consideration of these factors, SunTrust expects that the Federal
Reserve Board will consider the regulatory status of SunTrust and Wachovia,
including legal and regulatory compliance, and the overall capital and
safety and soundness standards established by the Federal Deposit Insurance
Corporation Improvement Act of 1991, as amended, and the regulations issued
under that statute.

Under the Community Reinvestment Act of 1977, as amended, the
Federal Reserve Board will take into account the records of performance of
SunTrust and Wachovia in meeting the credit needs of the entire
communities, including low- and moderate-income neighborhoods, served by
them. Each of the banking subsidiaries of SunTrust and Wachovia has
received at least a satisfactory rating in its most recent Community
Reinvestment Act examinations from their federal regulator with respect to
this criterion.

The Federal Reserve Board will furnish notice and a copy of the
application for approval of the Proposed SunTrust Merger to the Office of
the Comptroller of the Currency, the Federal Deposit Insurance Corporation
and the appropriate state regulatory authorities. These agencies have 30
days to submit their views and recommendations to the Federal Reserve
Board. The Federal Reserve Board is required to hold a public hearing in
the event it receives a written recommendation of disapproval of the
application from any of these agencies within this 30-day period.
Furthermore, the Bank Holding Company Act and Federal Reserve Board
regulations require published notice of, and the opportunity for public
comment on, the application submitted by SunTrust for approval of the
Proposed SunTrust Merger, and authorize the Federal Reserve Board to hold a
public hearing or meeting if the Federal Reserve Board determines that a
hearing or meeting would be appropriate. Any hearing or meeting or comments
provided by third parties could prolong the period during which the
application is under review by the Federal Reserve Board.

If the DOJ were to commence an antitrust action, that action would
stay the effectiveness of Federal Reserve Board approval of the Proposed
SunTrust Merger unless a court specifically orders otherwise. In reviewing
the Proposed SunTrust Merger, the DOJ could analyze the Proposed SunTrust
Merger's effect on competition differently than the Federal Reserve Board,
and thus it is possible that the DOJ could reach a different conclusion
than the Federal Reserve Board regarding the Proposed SunTrust Merger's
effects on competition. In particular, the DOJ may focus on the impact of
the Proposed SunTrust Merger on competition for loans and other financial
services to small and middle market businesses. A determination by the DOJ
not to object to the merger may not prevent the filing of antitrust actions
by private persons or state attorneys general.

SunTrust's estimates that SunTrust and Wachovia will need to make
divestitures of deposits of up to approximately $1.5 billion, and related
loans, in order to avoid a determination by the Federal Reserve Board or
the DOJ that the Proposed SunTrust Merger would have a significantly
adverse effect on competition in the relevant markets in those states. This
estimate is based on Federal Reserve Board decisions in other cases and
published deposit figures. Although there can be no assurances, SunTrust
believes that the divestitures would not have a material negative effect on
the combined company. Under Federal Reserve Board policy, the Proposed
SunTrust Merger cannot be completed until there is an executed definitive
agreement for the divestitures.

Other Regulatory Authorities. Applications or notifications are
being filed with various state and/or foreign regulatory authorities and
self-regulatory organizations in connection with acquisitions or changes in
control of subsidiaries of SunTrust and/or Wachovia, including banks,
broker-dealers and insurance subsidiaries, that may be deemed to result
from the Proposed SunTrust Merger. In addition, the Proposed SunTrust
Merger may be reviewed by the attorneys general in the various states in
which SunTrust and Wachovia own banking subsidiaries. These authorities may
be empowered under the applicable state laws and regulations to investigate
os disapprove the Proposed SunTrust Merger under the circumstances and
based upon the review provided for in applicable state laws and
regulations.

Antitrust. Because the Proposed SunTrust Merger involves
activities that are not subject to review by the Federal Reserve Board
under Sections 3 or 4 of the Bank Holding Company Act, it is partially
subject to the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended (the "HSR Act"). The HSR Act prohibits the completion of large
transactions unless the parties notify the Federal Trade Commission (the
"FTC") or the DOJ in advance and a specified waiting period expires.
SunTrust intends to file premerger notification and report forms with the
FUC and the Antitrust Division of the DOJ, and expects that Wachovia will
fulfil its independent obligation to make such filings. A transaction or
portion of a transaction that is notifiable under the HSR Act may not be
consummated until the expiration of a 30 calendar-day waiting period, or
the early termination of that waiting period, following the filing of
premerger notification and report forms by the parties with the FTC and
DOJ. If either the FTC or the DOJ were to request additional information or
documentary material with respect to the Proposed SunTrust Merger from the
parties prior to the expiration of the waiting period, the waiting period
would expire at 11:59 p.m., New York City time, on the 20th calendar day
after the date of substantial compliance with that request. At any time
before or after the completion of the Proposed SunTrust Merger and the
exchange of shares, the FTC or the DOJ could take whatever action under the
antitrust laws it deems necessary or desirable in the public interest,
including seeking to enjoin the Proposed SunTrust Merger, or seeking a
divestiture of shares or assets.

No assurance can be provided as to if, or when, any of the
required regulatory approvals necessary to consummate the Proposed SunTrust
Merger will be obtained.

CERTAIN LITIGATION

On May 22, 2001, SunTrust commenced an action in United States
District Court for the Northern District of Georgia against Wachovia and
First Union seeking to enjoin Wachovia and First Union from continuing to
engage in alleged violations of the federal securities laws in furtherance
of their efforts to solicit Wachovia shareholders to vote in favor of the
Proposed First Union Merger. The complaint, as amended, alleges violations
of Section 14(a) of the Securities Exchange Act of 1934, 15 U.S.C. ss.
78n(a), and the rules promulgated thereunder in connection with certain
public statements made in connection with the Proposed First Union Merger
and the Proposed SunTrust Merger.

On May 23, 2001, SunTrust commenced an action in the Superior
Court in Fulton County, Georgia against Wachovia, members of the Wachovia
board of directors and First Union. The complaint alleges, among other
things, breach of fiduciary duty and violations of Georgia law in
connection with the First Union Option and a certain provision of the First
Union Merger Agreement. On May 24, 2001, SunTrust was temporarily enjoined
from prosecuting this action by order of the Superior Court in Mecklenburg
County, North Carolina, as discussed below.

On May 22, 2001, First Union and First Union National Bank
commenced an action against SunTrust in the Superior Court, Mecklenburg
County, North Carolina alleging violation of the North Carolina Unfair
Practices Act, G.S. ss. 75-1.1 et seq. and tortious interference with
prospective economic advantage in connection with certain conduct allegedly
engaged in by SunTrust in connection with the Proposed First Union Merger
and the Proposed SunTrust Merger. Among other things, Wachovia and First
Union seek an order granting unspecified injunctive relief and a
declaratory judgment that the First Union Option is valid and enforceable.
The complaint also included a jury demand. The complaint was amended on May
23, 2001 to add Wachovia as a plaintiff and to add a claim for breach of
contract.

On May 24, 2001, SunTrust removed the North Carolina state court
action to the United States District Court for the Western District of
North Carolina. However, before the removal notice was filed in the North
Carolina Superior Court, that court granted plaintiffs' motion for a
temporary restraining order ("TRO") restraining SunTrust from prosecuting
the action in Georgia state court. On May 25, SunTrust filed a motion in
the North Carolina federal court for an expedited hearing and to dissolve
the TRO entered by the North Carolina Superior Court, which is scheduled to
be heard on May 29, 2001. Plaintiffs in the North Carolina action have
moved to remand the action to the state court.

VOTING INFORMATION

According to information contained in the Joint Proxy
Statement-Prospectus, as of the Record Date there were [ ] shares of
Wachovia Common Stock outstanding. On each matter properly submitted to
Wachovia shareholders, each Wachovia shareholder is entitled to one vote
for each outstanding share of Wachovia Common Stock held as of the close of
business on the Record Date. Approval of the Proposed First Union Merger
requires the affirmative vote of holders of a majority of all outstanding
shares of Wachovia Common Stock entitled to vote at the Annual Meeting.
Broker non-votes and abstentions will have the same effect as votes against
the Proposed First Union Merger.

The accompanying [BLUE] proxy will be voted in accordance with the
shareholder's instructions on such [BLUE] proxy. Shareholders may vote
against the Proposed First Union Merger by marking the proper box on the
[BLUE] proxy. If no instructions are given with respect to proposal one,
the [BLUE] proxy will be voted AGAINST the Proposed First Union Merger.

Whether or not you plan to attend the Annual Meeting, we urge you
to vote AGAINST the Proposed First Union Merger on the enclosed [BLUE]
proxy and immediately mail it in the enclosed envelope. You may do this
even if you have already sent in a different proxy solicited by Wachovia's
Board of Directors. IT IS YOUR LATEST DATED PROXY THAT COUNTS. Execution
and delivery of a proxy by a record holder of shares of Wachovia Common
Stock will be presumed to be a proxy with respect to all shares held by
such record holder unless the proxy specifies otherwise.

You may revoke your proxy at any time prior to its exercise by
attending the Annual Meeting and voting in person, by submitting a duly
executed later dated proxy or by submitting a written, signed and dated
notice of revocation which clearly identifies the proxy being revoked to
SunTrust's Secretary at 303 Peachtree Street, NE, Atlanta, GA 30308. Unless
revoked in the manner set forth above, duly executed proxies in the form
enclosed will be voted at the Annual Meeting on the Proposed First Union
Merger in accordance with your instructions. In the absence of such
instructions, such proxies will be voted AGAINST the Proposed First Union
Merger.

SUNTRUST STRONGLY RECOMMENDS A VOTE AGAINST THE PROPOSED
FIRST UNION MERGER.

YOUR VOTE IS IMPORTANT. PLEASE SIGN, DATE AND RETURN THE
[BLUE] PROXY TODAY.

IF YOU ALREADY HAVE SENT A PROXY TO WACHOVIA, YOU MAY REVOKE THAT
PROXY AND VOTE AGAINST THE PROPOSED FIRST UNION MERGER BY SIGNING,
DATING AND MAILING THE ENCLOSED [BLUE] PROXY.

If you have any questions about the voting of your
shares, please call:

INNISFREE M&A INCORPORATED
501 Madison Avenue, 20th Floor
New York, New York 10022
CALL TOLL-FREE 1-877-750-9501
Banks and Brokers call collect: 212-750-5833

OTHER PROPOSALS TO BE CONSIDERED AT THE ANNUAL MEETING

As set forth in the Joint Proxy Statement-Prospectus, at the
Annual Meeting, Wachovia shareholders will be asked to approve (in addition
to the First Union Merger Agreement and the Proposed First Union Merger)
(i) the election of five director candidates named in the Joint Proxy
Statement-Prospectus, (ii) the Wachovia directors' appointment of Ernst &
Young LLP as the independent auditors of Wachovia for the year 2001
(collectively, the "Other Proposals"), and (iii) such other matters as may
properly come before the Annual Meeting or any adjournment or postponement
thereof. SunTrust is not making any recommendations on the Other Proposals.

According to information contained in the Joint Proxy
Statement-Prospectus, election of the nominees for director requires a
plurality of the votes cast at the Annual Meeting, and ratification of the
appointment of Ernst & Young LLP as independent auditors requires the
affirmative vote of a majority of the votes cast at the Annual Meeting.

The accompanying [BLUE] proxy card will be voted in accordance
with your instructions on such card. You may vote for approval of one or
both of the Other Proposals, or vote against, or abstain from voting on,
one or both of the Other Proposals, by marking the proper box on the [BLUE]
proxy card. IF NO DIRECTION IS INDICATED WITH REGARD TO ANY OF THE OTHER
PROPOSALS, YOU WILL BE DEEMED TO HAVE GIVEN A DIRECTION TO ABSTAIN FROM
VOTING THE SHARES REPRESENTED BY THE [BLUE] PROXY CARD ON SUCH OTHER
PROPOSAL.

Except as set forth above, SunTrust is not aware of any other
matter to be considered at the Annual Meeting. However, if any other matter
properly comes before the Annual Meeting, SunTrust will vote all proxies
held by it as SunTrust, in its sole discretion, may determine.

DISSENTER'S RIGHTS

The following description of dissenter's rights of Wachovia
shareholders in connection with the Proposed First Union Merger is taken
from the Joint Proxy Statement-Prospectus and assumes that the Proposed
First Union Merger is completed.

According to the Joint Proxy Statement-Prospectus, if the Proposed
First Union Merger is completed, a Wachovia shareholder of record who
objects to the First Union Merger and who fully complies with Sections
55-13-01 through 55-13-31 of the North Carolina Business Corporation Act
(the "BCA") will be entitled to demand and receive payment in cash of an
amount equal to the fair value of all, but not less than all, of such
holder's shares of Wachovia Common Stock. A shareholder of record may
assert dissenters' rights as to fewer than all of the shares registered in
that shareholder's name only if that shareholder dissents with respect to
all shares beneficially owned by any one beneficial owner and notifies
Wachovia in writing of the name and address of each person on whose behalf
that registered shareholder asserts dissenters' rights.

If you are a Wachovia shareholder and desire to dissent and
receive cash payment of the fair value of your Wachovia Common Stock you
must comply with the procedural requirements of the BCA, including, without
limitation: (1) delivering to Wachovia, prior to the shareholder vote on
the Proposed First Union Merger, a written notice of your intent to demand
payment for your shares if the Proposed First Union Merger is completed;
(2) not voting your shares in favor of the Proposed First Union Merger; and
(3) demanding payment and depositing your stock certificates with Wachovia
in accordance with the terms of a dissenters' notice to be sent to all
dissenting shareholders within 10 days after the Proposed First Union
Merger is approved by the Wachovia shareholders.

Within 30 days after First Union pays for the shares of a
dissenting shareholder, or within 30 days of First Union failing to timely
act in accordance with the BCA, the dissenting shareholder may notify First
Union that he or she does not accept the estimate of fair value of the
shares and interest due on that fair value and that the shareholder demands
payment in the amount of the shareholder's own estimate of the fair value
of the shares and interest due. If, within 60 days of First Union's
payment, or dissenting shareholder's demand for payment of a different
amount, whichever is earlier, the payment amount has not been settled, the
dissenting shareholder may file an action in the Superior Court Division of
the General Court of Justice, requesting that the fair value of the
dissenting shareholder's shares be determined. The court will have
discretion to make all dissenting shareholders whose demand remain
unsettled parties to the proceeding. If a dissenting shareholder does not
begin the proceeding within the 60-day period, he will be deemed to have
withdrawn his dissent and demand for payment.

Voting against, abstaining from voting or failing to vote on the
proposal to approve the Proposed First Union Merger is not enough to
satisfy the requirements of the BCA. You must also comply with all of the
conditions relating to the separate written notice of intent to dissent to
the merger, the separate written demand for payment of the fair value of
your shares of Wachovia Common Stock and the deposit of your stock
certificates.

SOLICITATION OF PROXIES

Proxies will be solicited by mail, telephone, telefax, telegraph,
the Internet, newspapers and other publications of general distribution and
in person. Directors, officers and certain employees of SunTrust and the
other participants listed on Schedule II hereto may assist in the
solicitation of proxies without any additional remuneration (except as
otherwise set forth in this Proxy Statement).

SunTrust has retained Innisfree M&A Incorporated ("Innisfree") for
solicitation and advisory services in connection with solicitations
relating to the Annual Meeting, for which Innisfree is to receive a fee
estimated not to exceed $400,000 in connection with the solicitation of
proxies for the Annual Meeting. Up to 200 people may be employed by
Innisfree in connection with the solicitation of proxies for the Annual
Meeting. SunTrust has also agreed to reimburse Innisfree for out-of- pocket
expenses and to indemnify Innisfree against certain liabilities and
expenses, including reasonable legal fees and related charges. Innisfree
will solicit proxies for the Annual Meeting from individuals, brokers,
banks, bank nominees and other institutional holders. Directors, officers
and certain employees of SunTrust may assist in the solicitation of proxies
without any additional remuneration. The entire expense of soliciting
proxies for the Annual Meeting by or on behalf of SunTrust is being borne
by SunTrust.

SunTrust has retained Morgan Stanley to act as its financial
advisor in connection with the SunTrust Merger Proposal. Pursuant to a
Letter Agreement between Morgan Stanley and SunTrust, SunTrust has agreed
to pay Morgan Stanley for its financial advisory services in connection
with the SunTrust Merger Proposal a financial advisory fee of (1) $5
million upon public announcement of the SunTrust Merger Proposal, and (2)
additional fees, in varying amounts payable periodically or upon the
occurrence of certain events, of up to $25 million (less all amounts
previously paid or payable as described in (1) above). SunTrust has also
agreed to reimburse Morgan Stanley for its reasonable expenses, including
the fees and expenses of their legal counsel incurred in connection with
Morgan Stanley's engagement by SunTrust. In addition, SunTrust has agreed
to indemnify Morgan Stanley and certain related persons against certain
liabilities, including certain liabilities under the federal securities
laws, arising out of their engagement.

In connection with Morgan Stanley's engagement as financial
advisor, SunTrust anticipates that certain employees of Morgan Stanley may
communicate in person, by telephone or otherwise with a limited number of
institutions, brokers or other persons who are Wachovia shareholders for
the purpose of assisting in the solicitation of proxies for the Annual
Meeting. Morgan Stanley will not receive any fee for or in connection with
such solicitation activities apart from the fees which it is otherwise
entitled to receive as described above.

CERTAIN INFORMATION ABOUT SUNTRUST

SunTrust is a Georgia corporation with its principal executive
offices located at 303 Peachtree Street, NE, Atlanta, Georgia 30308. The
telephone number of SunTrust at such location is (404) 588-7711.

SunTrust, with assets of $103.5 billion, is among the nation's
largest financial holding companies. Its principal subsidiary, SunTrust
Bank, offers a full line of financial services for consumers and
businesses. SunTrust serves more than 3.7 million customer households
through a regional organizational structure that encompasses more than
1,100 branches and 1,900 ATMs in six states - Alabama, Florida, Georgia,
Maryland, Tennessee and Virginia - plus the District of Columbia. SunTrust
also offers 24-hour delivery channels including internet and telephone
banking. In addition to traditional deposit, credit and trust and
investment services offered by SunTrust Bank, other SunTrust subsidiaries
provide mortgage banking, commercial and auto leasing, credit-related
insurance, asset management, discount brokerage and capital market
services. As of December 31, 2000, SunTrust had total trust assets of
$138.4 billion, including more than $91.6 billion in discretionary trust
assets, and a mortgage-servicing portfolio in excess of $42.3 billion.

SunTrust is subject to the informational filing requirements of
the Securities Exchange Act of 1934, as amended, and, in accordance
therewith, is obligated to file reports, proxy statements and other
information with the SEC relating to its business, financial condition and
other matters. Information as of particular dates concerning SunTrust's
directors and officers, their remuneration, options granted to them, the
principal holders of SunTrust's securities and any material interests of
such persons in transactions with SunTrust is required to be disclosed in
proxy statements distributed to SunTrust's stockholders and filed with the
SEC. Such reports, proxy statements and other information should be
available for inspection at the public reference facilities of the SEC at
450 Fifth Street, N.W., Washington, D.C. 20549, and at the regional offices
of the SEC located at Seven World Trade Center, Suite 1300, New York, NY
10048 and 500 West Madison Street, Suite 1400, Chicago, IL 60661 (call
1-800-SEC-0330 for hours). Copies of such information should be obtainable
by mail, upon payment of the SEC's customary charges, by writing to the
SEC's principal office at 450 Fifth Street, N.W., Washington, D.C.
20549-6009. The SEC also maintains an Internet website at
http://www.sec.gov that contains the reports, proxy statements and other
information filed electronically by SunTrust. SunTrust Common Stock is
listed on the NYSE under the symbol "STI," and reports, proxy statements
and other information concerning SunTrust should also be available at the
offices of the NYSE located at 20 Broad Street, New York, NY 10005.

FORWARD-LOOKING STATEMENTS

This Proxy Statement contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995. Such
statements include, but are not limited to, (i) statements about the
benefits of the Proposed SunTrust Merger, including future financial and
operating results, cost savings and accretion to reported and cash earnings
that may be realized from such merger; (ii) statements with respect to
SunTrust's plans, objectives, expectations and intentions and other
statements that are not historical facts; and (iii) other statements
identified by words such as "believes", "expects", "anticipates",
"estimates", "intends", "plans", "targets", "projects" and similar
expressions. These statements are based upon the current beliefs and
expectations of SunTrust's management and are subject to significant risks
and uncertainties. Actual results may differ from those set forth in the
forward-looking statements.

The following factors, among others, could cause actual results to
differ materially from the anticipated results or other expectations
expressed in the forward-looking statements: (1) the businesses of SunTrust
and Wachovia may not be integrated successfully or such integration may be
more difficult, time-consuming or costly than expected; (2) expected
revenue synergies and cost savings from the Proposed SunTrust Merger may
not be fully realized or realized within the expected time frame; (3)
revenues following the Proposed SunTrust Merger may be lower than expected;
(4) deposit attrition, operating costs, customer loss and business
disruption, including, without limitation, difficulties in maintaining
relationships with employees, customers, clients or suppliers, may be
greater than expected following the Proposed SunTrust Merger; (5) the
regulatory approvals required for the Proposed SunTrust Merger may not be
obtained on the proposed terms or on the anticipated schedule; (6)
SunTrust's or Wachovia's stockholders may fail to approve the Proposed
SunTrust Merger; (7) competitive pressures among depository and other
financial institutions may increase significantly and may have an effect on
pricing, spending, third-party relationships and revenues; (8) the strength
of the United States economy in general and the strength of the local
economies in which the combined company will conduct operations may be
different than expected, resulting in, among other things, a deterioration
in credit quality or a reduced demand for credit, including the resultant
effect on the combined company's loan portfolio and allowance for loan
losses; (9) changes in the U.S. and foreign legal and regulatory framework;
and (10) adverse conditions in the stock market, the public debt market and
other capital markets (including changes in interest rate conditions) and
the impact of such conditions on the combined company's capital markets and
asset management activities. Additional factors that could cause SunTrust's
results to differ materially from those described in the forward-looking
statements can be found in SunTrust's reports (such as Annual Reports on
Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K)
filed with the Securities and Exchange Commission and available at the
SEC's Internet site (http://www.sec.gov). All subsequent written and oral
forward-looking statements concerning the proposed transaction or other
matters attributable to SunTrust or any person acting on its behalf are
expressly qualified in their entirety by the cautionary statements above.
SunTrust does not undertake any obligation to update any forward-looking
statement to reflect circumstances or events that occur after the date the
forward-looking statements are made.

OTHER INFORMATION

The information concerning Wachovia, First Union and the Proposed
First Union Merger contained herein has been taken from or based upon, and
is qualified in its entirety by, the Joint Proxy Statement-Prospectus and
other publicly available documents on file with the SEC and other publicly
available information. SunTrust does not take any responsibility for the
accuracy or completeness of such information or for any failure by Wachovia
to disclose events that may have occurred and may affect the significance
or accuracy of any such information.

SHAREHOLDER PROPOSALS

According to information contained in the Joint Proxy
Statement-Prospectus, in order to be considered for inclusion in Wachovia's
proxy statement for the 2002 annual meeting of its stockholders, which is
presently scheduled for April 26, 2002, shareholder proposals would need to
be received by the Secretary of Wachovia no later than November 19, 2001.

Wachovia's by-laws contain procedures that shareholders must
follow to present business at an annual meeting of shareholders. A Wachovia
shareholder may obtain a copy of these procedures from Wachovia's
Secretary. In addition to other applicable requirements, for business to be
properly brought before the 2002 annual meeting of Wachovia shareholders, a
Wachovia shareholder must give notice of the matter to be presented at the
meeting in a proper written form to Wachovia's Secretary. The Secretary
must receive this written notice at the principal offices of Wachovia not
earlier than December 27, 2001 and not later than January 26, 2002.
Shareholder proposals not made in accordance with these requirements may be
disregarded by the Chairman of the meeting.

According to information contained in the Joint Proxy
Statement-Prospectus, shareholders who wish to nominate persons for
election as directors at the 2002 annual meeting of Wachovia shareholders,
which is presently scheduled to be held on April 26, 2002, must give
written notice in accordance with the requirements of Wachovia's by-laws to
Wachovia's Secretary not earlier than December 27, 2001 and not later than
January 26, 2002. Each notice must set forth (1) the name and address of
the shareholder who proposes to make the nomination and the name and
address of the person to be nominated; (2) a representation that the
shareholder is a holder of shares of common stock entitled to vote at the
meeting and intends to appear in person or by proxy at the meeting to
nominate the person specified in the notice; (3) a description of all
arrangements or understandings between the shareholder and each nominee and
any other person or persons (naming such person or persons) pursuant to
which the nomination is to be made; (4) such other information regarding
each nominee as would be required to be included in a proxy statement
pursuant to the proxy rules of the SEC if the nominee had been nominated by
the board of directors or a board committee; and (5) the written consent of
each nominee to serve as a director if so elected. Nominations not made in
accordance with these requirements may be disregarded by the Chairman of
the meeting.

SunTrust Banks, Inc.

Dated: [ ], 2001

If you have any questions or need assistance in voting your
shares, please call:

INNISFREE M&A INCORPORATED
501 Madison Avenue, 20th Floor
New York, New York 10022
CALL TOLL-FREE 1-877-750-9501
Banks and Brokers call collect: 212-750-5833

SCHEDULE I

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS,
DIRECTORS AND MANAGEMENT OF WACHOVIA

According to information contained in Wachovia's Proxy Statement
filed with the SEC on March 19, 2001 (the "March Proxy Statement"), as of
February 20, 2001, there were 204,036,945 shares of Wachovia Common Stock
outstanding. Pursuant to the First Union Option Agreement, Wachovia granted
First Union an option to purchase up to 19.9% of the issued and outstanding
shares of Wachovia Common Stock at the close of business on April 12, 2001.
The information concerning Wachovia and the Proposed First Union Merger
contained herein has been taken from or based upon publicly available
documents on file with the SEC and other publicly available information.
SunTrust does not take any responsibility for the accuracy or completeness
of such information or for any failure by Wachovia to disclose events that
may have occurred and may affect the significance or accuracy of any such
information.

The following table sets forth, as of February 20, 2001, the
number of shares of Wachovia Common Stock held by each director or nominee
for director and each executive officer named in the March Proxy
Statement's Summary Compensation Table, and by all directors and executive
officers as a group. Unless otherwise noted, each individual has sole
voting and investment authority with respect to the number of shares set
forth opposite their names.

Amount and Nature
of Beneficial Ownership Percent of
Name of Common Stock (1) Shares Outstanding (2)
---- --------------------- ----------------------

F. Duane Ackerman......................... 2,223 *
Leslie M. Baker, Jr. (3).................. 498,645 *
James S. Balloun.......................... 2,250 *
Peter C. Browning......................... 1,450 *
John T. Casteen III....................... 2,137 *
Jean E. Davis (3)......................... 56,466 *
Mickey W. Dry (3) (4) (5)................. 242,929 *
Thomas K. Hearn, Jr....................... 3,148 *
George W. Henderson, III (5).............. 3,459 *
W. Hayne Hipp............................. 7,770 *
Robert A. Ingram.......................... 1,700 *
George R. Lewis........................... 6,439 *
Elizabeth Valk Long....................... 2,100 *
Robert S. McCoy, Jr. (3) (5).............. 178,369 *
Lloyd U. Noland, III (6).................. 90,348 *
Morris W. Offit (7)....................... 489,201 *
G. Joseph Prendergast (3) (8)............. 237,325 *
Sherwood H. Smith, Jr. (5) (9)............ 9,129 *
John C. Whitaker, Jr...................... 5,522 *
Dona Davis Young.......................... 400 *
All Directors and Executive
Officers as a Group (26
persons)................................ 2,301,194 1.12%

* Less than 1%

(1) Includes the following number of shares of common stock that could
have been acquired within 60 days of February 20, 2001 through the
exercise of stock options or stock appreciation rights that are
settled in shares of common stock, or the vesting of restricted
stock awards under one or more of Wachovia's stock plans: Mr.
Baker, 353,098 shares; Ms. Davis, 50,900 shares; Mr. Dry, 130,331
shares; Mr. McCoy, 122,000 shares; Mr. Prendergast, 157,000
shares; and all directors and executive officers as a group,
1,188,736 shares.
(2) Based on the number of shares outstanding at, or acquirable within
60 days of, February 20, 2001.
(3) Includes shares held by Wachovia Bank, as Trustee under Wachovia's
Retirement Savings and Profit-Sharing Plan, as follows: Mr. Baker,
164 shares; Ms. Davis, 3,488 shares; Mr. Dry, 129 shares; Mr.
McCoy, 11,111 shares; Mr. Prendergast, 164 shares; and all
executive officers as a group, 21,796 shares.
(4) Retired as of January 31, 2001.
(5) Excludes shares owned by or for the benefit of family members of
the following directors and executive officers, each of whom
disclaims beneficial ownership of such shares: Mr. Dry, 3,000
shares; Mr. Henderson, 1,668 shares; Mr. McCoy, 973 shares; and
Mr. Smith, 3,000 shares.
(6) Includes 848 shares held in trusts of which Mr. Noland is a
co-trustee. Excludes 2,970 units held by Wachovia Bank, as Trustee
under the Central Fidelity Directors Plan, for Mr. Noland. The
units are equivalent to shares of common stock and do not have
voting rights. The units will be settled in stock according to Mr.
Noland's election under the plan.
(7) Includes 114,200 shares held by a family limited liability company
of which Mr. Offit is a member. Excludes 99,200 shares held by a
charitable remainder trust of which Mr. Offit's spouse is a
co-trustee and of which Mr. Offit's adult children have a
remainder interest.
(8) Retired as of January 1, 2001.
(9) Retired as of April 27, 2001.

The following table sets forth information for each person who, as
of February 20, 2001, beneficially owned more than 5% of Wachovia's common
stock. According to the March Proxy Statement, to the best of Wachovia's
knowledge, no other person owned more than 5% of Wachovia's common stock as
of February 20, 2001.

Amount and Nature
of Beneficial
Ownership of
Name and Address of Shares of Percent of
Beneficial Owner Common Stock Common Stock
------------------- ------------------- ------------

Wachovia Corporation (1) 13,449,686 (1) 6.61%
Wachovia Bank, National Association
Wachovia Securities, Inc.
100 North Main Street
Winston-Salem, NC 27101

Wellington Management Company, LLP (2) 12,604,294 (2) 6.19%
75 State Street
Boston, MA 02109

-------------------

(1) Wachovia Bank, National Association ("Wachovia Bank") and Wachovia
Securities, Inc. are each wholly owned subsidiaries of Wachovia.
All of the shares of Wachovia's common stock held by these two
companies are held in fiduciary or representative capacities for
the benefit of other persons. These two companies have, in the
aggregate, sole voting power for 5,481,847 shares, shared voting
power for 3,180,907 shares, sole dispositive power for 3,912,005
shares and shared dispositive power for 8,547,387 shares. This
information is based on Wachovia's Form 13G dated February 12,
2001.
(2) Wellington Management Company, LLP ("Wellington") is a registered
investment adviser and holds shares of Wachovia's common stock on
behalf of its investment advisory clients. Wellington has shared
voting power for 4,698,206 shares and shared dispositive power for
12,604,294 shares. This information is based on Wellington's Form
13G dated February 14, 2001.

SCHEDULE II

INFORMATION CONCERNING THE DIRECTORS AND EXECUTIVE OFFICERS
OF SUNTRUST AND OTHER PERSONS WHO MAY SOLICIT PROXIES

The following tables set forth the name and the title of persons
who may be deemed to be participants on behalf of SunTrust in the
solicitation of proxies from the stockholders of Wachovia.

DIRECTORS AND EXECUTIVE OFFICERS OF SUNTRUST

NAME POSITION
--------------------------------------- ---------------------------------------------------------

L. Phillip Humann Chairman of the Board, Chief Executive Officer and
President of the Company
John W. Clay, Jr. Vice Chairman
Theodore J. Hoepner Vice Chairman
John W. Spiegel Vice Chairman, Chief Financial Officer
James M. Wells III Vice Chairman
J. Hyatt Brown Director
Alston D. Correll Director
Douglas N. Daft Director
A.W. Dahlberg Director
Patricia C. Frist Director
David H. Hughes Director
M. Douglas Ivester Director
Summerfield K. Johnston, Jr. Director
Joseph L. Lanier, Jr. Director
G. Gilmer Minor, III Director
Larry L. Prince Director
R. Randall Rollins Director
Frank S. Royal, M.D. Director
James B. Williams Director
Ray Fortin General Counsel
Don Heroman Treasurer
Gary Peacock Investor Relations
Barry Koling Public Relations Director
Richard Blumberg Senior Vice President

As of the date of this Proxy Statement, SunTrust beneficially owns
1,000 shares of Wachovia Common Stock. John W. Clay, Jr., a person who will
solicit proxies, owns 25 shares of Wachovia Common Stock, and Theodore J.
Hoepner, a person who will solicit proxies, owns 280 shares of Wachovia
Common Stock. John W. Spiegel has two mortgages at market rate with
Wachovia. Other than as set forth herein, as of the date of this Proxy
Statement, neither SunTrust nor any of the other participants listed above
has any substantial interest, direct or indirect, by security holdings or
otherwise, in Wachovia.

OTHER PERSONS WHO MAY ALSO SOLICIT PROXIES

Representatives of Morgan Stanley

NAME POSITIONS
--------------------------------------- --------------------------------------
Gregory Kennedy Vice President
Gary Parr Managing Director
Jonathan Pruzan Principal
William Weiant Managing Director
Shane Zhang Associate

Morgan Stanley engages in a full range of investment banking,
securities trading, market- making and brokerage services for institutional
and individual clients. In the normal course of its business, Morgan
Stanley may trade the debt and equity securities of Wachovia for its own
account and the accounts of its customers, and, accordingly, may at any
time hold a long or short position in such securities. Morgan Stanley has
informed SunTrust that, as of the close of business on May 10, 2001, Morgan
Stanley, for its own account, held a net long position of 139,885 shares of
Wachovia Common Stock and owned $2 million aggregate principal amount of
Wachovia's 6.605% subordinated notes due 2025. Morgan Stanley and certain
of its affiliates also may have voting and dispositive power with respect
to certain shares of Wachovia Common Stock held in asset management,
brokerage and other accounts. Morgan Stanley and such affiliates disclaim
beneficial ownership of such shares of Wachovia Common Stock. Morgan
Stanley does not admit that it or any of its partners, directors, officers,
employees, affiliates or controlling persons, if any, is a "participant" as
defined in Schedule 14A promulgated under the Exchange Act, in the
solicitation of proxies, or that Schedule 14A requires the disclosure of
certain information concerning it or them. Morgan Stanley's principal
business address is 1585 Broadway, New York, New York 10036.

IMPORTANT

If your shares are held in your own name, please sign, date and
return the enclosed [BLUE] proxy card today. If your shares are held in
"Street-Name," only your broker or bank can vote your Shares and only upon
receipt of your specific instructions. Please return the enclosed [BLUE]
proxy card to your broker or bank and contact the person responsible for
your account to ensure that a [BLUE] proxy is voted on your behalf.

Do not sign any [white] proxy card you may receive from Wachovia.

If you have any questions or need assistance in voting your
shares, please call:

INNISFREE M&A INCORPORATED
501 Madison Avenue, 20th Floor
New York, New York 10022
CALL TOLL-FREE 1-877-750-9501
Banks and Brokers call collect: 212-750-5833

PRELIMINARY COPY - SUBJECT TO COMPLETION

P
R THIS PROXY IS SOLICITED ON BEHALF OF SUNTRUST BANKS, INC.
O IN OPPOSITION TO THE SOLICITATION BY THE WACHOVIA BOARD OF DIRECTORS
X FOR USE AT THE ANNUAL MEETING OF SHAREHOLDERS
Y OF WACHOVIA CORPORATION
TO BE HELD ON AUGUST 3, 2001

The undersigned shareholder of Wachovia Corporation ("Wachovia")
hereby appoints [ ] and [ ] and each or any of them, attorneys and
proxies of the undersigned, with full power of substitution, to
vote all of the shares of common stock, par value $5.00 per share,
of Wachovia which the undersigned is entitled to vote at the
Annual Meeting of Shareholders of Wachovia to be held on August 3,
2001, at [ ], at [ ] a.m., local time, and at any adjournments,
postponements, continuations or reschedulings thereof (the "Annual
Meeting"), with all the powers the undersigned would possess if
personally present at the Annual Meeting, as directed on the
reverse side.

This proxy when properly executed will be voted in the manner
directed herein by the undersigned shareholder and at the
discretion of the proxy holders as to any other business that may
properly come before the Annual Meeting. If no direction is
indicated for Item 1, this proxy will be voted AGAINST approval of
the Wachovia/First Union Plan of Merger. If no direction is
indicated on Items 2 or 3, this proxy will ABSTAIN from voting
! with respect to those items.

This proxy revokes all prior proxies given by the undersigned with
respect to the matters covered hereby.

(Continued and to be signed on reverse side.)

----------
SEE
REVERSE
SIDE
----------

---------------------
X Please mark your
vote as this
example
---------------------

SUNTRUST RECOMMENDS THAT YOU VOTE AGAINST ITEM 1 BELOW
-------
AGAINST FOR ABSTAIN

1. Approval of the plan of merger contained / / / / / /
in the Agreement and Plan of Merger, dated
April 15, 2001, between Wachovia Corporation,
a North Carolina corporation and First Union
Corporation, a North Carolina corporation

FOR all WITHHOLD ABSTAIN
nominees AUTHORITY
listed for all
below nominees
(except as listed
indicated)* below
2. Election of directors of Wachovia / / / / / /
Corporation

James S. Balloun Peter C. Browning W. Hayne Hipp

Lloyd U. Noland, III Dona Davis Young

*INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE
FOR ANY INDIVIDUAL NOMINEE, STRIKE THROUGH THAT
INDIVIDUAL'S NAME
AGAINST FOR ABSTAIN

3. Ratification of the appointment of Ernst &
Young LLP as Wachovia Corporation's / / / / / /
independent auditors for the year 2001

4/ The proxies are authorized to vote in PLEASE SIGN, DATE AND RETURN
their discretion upon all such THIS PROXY PROMPTLY IN THE
other matters as may properly come ENCLOSED, POSTAGE-PAID
before the Annual Meeting. ENVELOPE.

DATED____________________, 2001

SIGNATURE____________________________________________________________________

SIGNATURE (if held jointly) _________________________________________________

TITLE(S) ____________________________________________________________________
Please sign your name exactly as it appears hereon. When signing as
attorney, executor, administrator, trustee or guardian please give your
full title. If a corporation, please sign in full corporate name by the
president or other authorized officer. If a partnership, please sign the
partnership name by authorized person(s).

If you need assistance in voting your shares, please call Innisfree M&A
Incorporated, SunTrust's proxy solicitor, toll free at 1-877-750-9501