PROSPECTUS SUPPLEMENT
Rule 424(b)(5)
(To Prospectus dated January 26, 1994)
Registration Nos. 33-53514, 33-51227,
33-45066, 33-42273, 33-39045
Company Logo - Stagecoach, Horses
Wells Fargo & Company
$1,500,000,000
Wells Fargo & Company
Medium-Term Notes and Subordinated Medium-Term Notes, Series B
Due from 9 Months to 12 Years from Date of Issue
Wells Fargo & Company (the "Company") is offering by this
Prospectus Supplement two series of notes, its Medium-Term Notes
("Senior Notes") and Subordinated Medium-Term Notes, Series B
("Subordinated Notes") (together, the "Notes") in an aggregate
principal amount of up to $1,500,000,000 or the equivalent thereof
in other currencies or currency units, subject to possible
reduction as a result of the sale of other debt securities or
preferred stock of the Company. See "Description of Medium-Term
Notes" and "Plan of Distribution." Senior Notes will rank on a
parity with all other unsecured and unsubordinated indebtedness of
the Company and Subordinated Notes will be subordinated as
described under "Description of Notes-Subordination of Subordinated
Notes" in the Prospectus to which this Prospectus Supplement
relates. Unless otherwise indicated in the applicable Pricing
Supplement to this Prospectus Supplement (a "Pricing Supplement"),
the Interest Payment Dates for Fixed Rate Notes will be April 1 and
October 1 of each year, any date fixed for redemption or repayment
and the Stated Maturity (as defined herein). Interest Payment
Dates for Floating Rate Notes will be set forth in the applicable
Pricing Supplement. Each Note will mature on a day from 9 months
to 12 years from the date of issue, as set forth on the face of
such Note, and may be subject to optional redemption, or obligate
the Company to redeem or purchase the Notes pursuant to a sinking
fund or analogous provisions or at the option of the holder
thereof, in each case as indicated in the applicable Pricing
Supplement. The Notes will be issued only in denominations of
$1,000 and integral multiples of $1,000 in excess thereof.
Each Note will be issued only in fully registered form and
will be represented by either a Global Security (as defined herein)
registered in the name of a nominee of The Depository Trust
Company, as Depositary (a "Book-Entry Note"), or a certificate
issued in definitive form (a "Certificated Note"), as set forth in
the applicable Pricing Supplement. Beneficial interests in
Book-Entry Notes will be shown on, and transfers thereof will be
effected only through, the records maintained by the Depositary's
participants. Except as described in "Description of Medium-Term
Notes-Book-Entry Notes," owners of beneficial interests in
Book-Entry Notes will not be entitled to receive Notes in
definitive form and will not be considered the holders thereof.
The specific designation, ranking as senior or subordinated
debt, aggregate principal amount, interest rate, or interest rate
formula, if any, issue price, Earliest Redemption Date, if any,
Stated Maturity and any additional information for each Note will
be established by the Company at the date of issuance of such Note
and will be indicated in an accompanying Pricing Supplement.
Unless otherwise indicated in the applicable Pricing Supplement,
the Notes, except Zero-Coupon Notes, will bear interest at a fixed
rate or at a rate or rates determined by reference to LIBOR, the
Treasury Rate, the Commercial Paper Rate, the Prime Rate, the CD
Rate, the CMT Rate, or the Federal Funds Effective Rate (each as
defined herein), as adjusted by a Spread and/or Spread Multiplier
(each as defined herein), if any is applicable to such Notes.
Zero-Coupon Notes will be issued at a discount from the principal
amount payable at maturity thereof, but holders of Zero-Coupon
Notes will not receive periodic payments of interest on such Notes.
Payment of principal of the Subordinated Notes may be accelerated
only in the case of certain events of bankruptcy, insolvency or
reorganization of the Company or Wells Fargo Bank, National
Association (the "Bank"). There is no right of acceleration in the
case of a default in the performance of any covenant with respect
to the Subordinated Notes, including a default in the payment of
interest or principal.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS TO WHICH IT RELATES.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. THE
NOTES OFFERED HEREBY ARE NOT DEPOSITS OR SAVINGS ACCOUNTS BUT ARE
UNSECURED DEBT OBLIGATIONS OF WELLS FARGO & COMPANY AND ARE NOT
INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER
GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
<TABLE>
<CAPTION>
Price Agents' Proceeds to
to Public<F1> Commissions<F2> Company<F2><F3>
<S> <C> <C> <C>
Per Note................. 100% .125%-.625% 99.875%-99.375%
Total<F4>................ $1,500,000,000 $1,875,000-$9,375,000 $1,498,125,000-$1,490,625,000
</TABLE>
[FN]
<F1> Unless otherwise specified in a Pricing Supplement, Notes will
be issued at 100% of their principal amount.
<F2> The Company will pay Merrill Lynch & Co., Merrill Lynch,
Pierce, Fenner & Smith Incorporated, CS First Boston Corporation,
Goldman, Sachs & Co., Lehman Brothers, Lehman Brothers Inc.
(including its affiliate Lehman Special Securities Inc.), Morgan
Stanley & Co. Incorporated or Salomon Brothers Inc (the "Agents")
a commission ranging from .125% to .625% of the principal amount of
any Note, depending on maturity, sold through such Agent. The
Company also may sell Notes to any Agent for resale to investors or
others purchasers at varying prices related to prevailing market
prices at the time of resale to be determined by such Agent or, if
so agreed, at a fixed public offering price. Unless otherwise
specified in the applicable Pricing Supplement, any Note sold to an
Agent as principal will be purchased by such Agent at a price equal
to 100% of the principal amount thereof less a percentage equal to
the commission applicable to an agency sale of a Note of identical
maturity, and may be resold by such Agent. The Company has agreed
to indemnify the Agents against certain liabilities, including
certain liabilities under the Securities Act of 1933.
<F3> Assuming that the Notes are issued at 100% of principal amount
and before deducting expenses payable by the Company estimated at
$935,000.
<F4> Or the equivalent thereof in other currencies or currency
units.
The Notes may be offered by the Company through the Agents,
each of which has agreed to use best efforts to solicit offers to
purchase the Notes. The Company also may sell Notes to any Agent
acting as principal for resale to one or more purchasers. The
Notes may also be sold by the Company or an affiliate of the
Company directly to purchasers on behalf of the Company in those
jurisdictions where it is authorized to do so. The Notes will not
be listed on any securities exchange, and there can be no assurance
that the Notes offered by this Prospectus Supplement will be sold
or that there will be a secondary market for the Notes. The
Company reserves the right to withdraw, cancel or modify the offer
or solicitations of offers made hereby without notice. The Company
or any Agent, if it solicits such offer, may reject any offer to
purchase Notes, in whole or in part. See "Plan of Distribution."
Merrill Lynch & Co.
CS First Boston
Goldman, Sachs & Co.
Lehman Brothers
Morgan Stanley & Co. Incorporated
Salomon Brothers Inc
The date of this Prospectus Supplement is March 24, 1994.
<PAGE>
IN CONNECTION WITH THE DISTRIBUTION OF THE NOTES, ANY AGENT MAY
OVERALLOT OR EFFECT TRANSACTIONS IN THE NOTES OR OTHER DEBT
SECURITIES OF THE COMPANY WITH A VIEW TO STABILIZING OR MAINTAINING
THE MARKET PRICE OF THE NOTES OR OTHER DEBT SECURITIES OF THE
COMPANY AT LEVELS OTHER THAN THOSE WHICH MIGHT OTHERWISE PREVAIL IN
THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE
DISCONTINUED AT ANY TIME.
DESCRIPTION OF MEDIUM-TERM NOTES
GENERAL
The following description of the particular terms of the
Notes offered hereby supplements, and to the extent inconsistent
therewith replaces, the description of the general terms and
provisions of Notes set forth under the heading "Description of
Notes" in the accompanying Prospectus, to which description
reference is hereby made. Capitalized terms not defined herein
have the meanings assigned to such terms in the Prospectus.
At the option of the Company, the Notes may be issued as
Medium-Term Notes which constitute senior debt securities ("Senior
Notes") and as Subordinated Medium-Term Notes, Series B which
constitute subordinated debt securities ("Subordinated Notes")
(together the "Notes"). The Senior Notes, an additional
$6,074,071,000 of which as of the date of this Prospectus
Supplement have been previously issued under separate Prospectuses,
constitute a single series and will be issued under an Indenture,
dated as of September 1, 1984, as amended by the First Supplemental
Indenture dated as of April 15, 1986, the Second Supplemental
Indenture dated as of June 30, 1987, and the Third Supplemental
Indenture dated as of January 23, 1991 (together, the "Senior
Indenture"), between the Company and Chemical Bank, as successor
Trustee (the "Senior Trustee"). The Subordinated Notes, none of
which has been previously issued, will be issued under an Indenture
dated as of December 10, 1992 (the "Subordinated Indenture"),
between the Company and Marine Midland Bank, as Trustee (the
"Subordinated Trustee"). In this Prospectus Supplement, the Senior
Indenture and the Subordinated Indenture are referred to as the
"Indentures." The Senior Trustee and the Subordinated Trustee are
referred to as the "Trustees." The Indentures do not limit the
amount of notes which can be issued thereunder and provide that
notes of any series may be issued thereunder up to the aggregate
principal amount which may be authorized from time to time by the
Company. The terms of Notes may be varied in the applicable
Pricing Supplement.
Senior Notes will rank on a parity with all other
unsecured and unsubordinated indebtedness of the Company and
Subordinated Notes will be subordinated as described under
"Description of Notes--Subordination of Subordinated Notes" in the
Prospectus. Payment of the principal of the Subordinated Notes may
be accelerated only in the case of certain events of bankruptcy,
insolvency or reorganization of the Company or the Bank. There is
no right of acceleration in the case of a default in the
performance of any covenant with respect to the Subordinated Notes,
including a default in the payment of interest or principal. See
"Description of Notes--Events of Default" in the Prospectus.
Each Note will mature on a day from 9 months to 12 years
from its date of issue, as selected by the initial purchaser and
agreed to by the Company ("Stated Maturity"). The Notes will be
issuable only in fully registered form in denominations of $1,000
and integral multiples of $1,000 in excess thereof.
Each Note will be issued initially as either a Book-Entry
Note or a Certificated Note. See "Book-Entry Notes."
Payments of principal and premium, if any, and interest
payable at the Stated Maturity or at any Redemption Date or
Repayment Date (as defined below) on Senior and Subordinated Notes
will be made in immediately available funds at the principal
corporate trust office of Chemical Bank, as paying agent, in the
Borough of Manhattan, The City of New York, or Chemical Trust
Company of California, as paying agent, in
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the City and County of San Francisco, California (each a "Paying
Agent"), provided that the Note is presented to a Paying Agent in
time for such Paying Agent to make such payments in such funds in
accordance with its normal procedures. For interest payments on
Notes of U.S. $5,000,000 or more in principal amount, the purchaser
may elect at any time to have payment made in immediately available
funds. Interest payments on Notes of less than U.S. $5,000,000 in
principal amount will be made in immediately available funds only
if agreed to on a case-by-case basis by the Company and otherwise
will be made by check mailed on the Interest Payment Date to the
registered holder thereof (which, in the case of Book-Entry Notes,
will be a nominee of the Depositary), except that interest payments
made at any Redemption Date, Repayment Date or at the Stated
Maturity will be made as described above. Interest payments will
not be made in immediately available funds unless written
instructions have been presented to a Paying Agent, at least 15
days prior to the Regular Record Date from and after which a holder
has elected to receive payments in immediately available funds.
The Notes may be presented for registration of transfer or exchange
at the offices or agencies to be maintained by the Company in the
City and County of San Francisco, California and in the Borough of
Manhattan, The City of New York, State of New York.
FOREIGN CURRENCIES
Unless otherwise indicated in the applicable Pricing
Supplement, the Notes will be denominated in U.S. dollars and
payments of principal of, premium, if any, and interest on the
Notes will be made in U.S. dollars. If any of the Notes are to be
denominated in a currency other than U.S. dollars, including a
composite currency, or if the principal of, premium, if any, or
interest on any of the Notes is to be payable at the option of the
holder or the Company in a currency, including a composite
currency, other than that in which such Note is denominated, the
applicable Pricing Supplement will provide additional disclosure
pertaining to the terms of such Notes and other matters of interest
to the holders thereof.
INTEREST
Each Note, except a Zero-Coupon Note, will bear interest
from the date of issue or from the most recent Interest Payment
Date to which interest on such Note (or any predecessor Note) has
been paid or duly provided for at the fixed rate per annum, or at
the rate per annum determined pursuant to the interest rate
formula, set forth therein and in the applicable Pricing
Supplement, until the principal thereof is paid or made available
for payment. Unless otherwise indicated in the applicable Pricing
Supplement, the Interest Payment Dates for the Fixed Rate Notes (as
defined below) will be April 1 and October 1. Interest on a Note
will also be paid on any Redemption Date, Repayment Date and the
Stated Maturity. The Interest Payment Dates for the Floating Rate
Notes are set forth below. Interest will be payable to the person
in whose name a Note (or any predecessor Note) is registered at the
close of business on the Regular Record Date next preceding each
Interest Payment Date; provided, however, that interest payable at
Stated Maturity or, if applicable, upon redemption or repayment,
will be payable to the person to whom principal shall be payable.
The first payment of interest on any Note originally issued between
a Regular Record Date and an Interest Payment Date will be made on
the Interest Payment Date following the next succeeding Regular
Record Date to the registered owner on such next succeeding Regular
Record Date. Unless otherwise indicated in the applicable Pricing
Supplement, the "Regular Record Date" with respect to Floating Rate
Notes shall be the date 15 calendar days prior to each Interest
Payment Date, whether or not such date shall be a Business Day (as
defined below), and the Regular Record Dates with respect to the
Fixed Rate Notes shall be the March 15 and September 15 next
preceding the April 1 and October 1 Interest Payment Dates. Unless
otherwise provided in the applicable Pricing Supplement, the Senior
Trustee initially will be the calculation agent (the "Calculation
Agent") with respect to the Floating Rate Notes issued under both
the Senior Indenture and the Subordinated Indenture. The Company,
at a later date, may choose to have the Bank or any other person
serve as the Calculation Agent.
Interest rates, or interest rate formulas, are subject to
change by the Company from time to time, but no such change will
affect the interest rate or interest rate formula on any Note
already issued or as to which an offer to purchase has been
accepted by the Company.
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<PAGE>
Each Note, except a Zero-Coupon Note, will bear interest
at either (a) a fixed rate or rates (a "Fixed Rate Note") or (b) a
variable rate or rates determined by reference to an interest rate
formula (a "Floating Rate Note"), which may be adjusted by adding
or subtracting the Spread and/or multiplying by the Spread
Multiplier (each term as defined below), unless otherwise specified
therein. A "Zero Coupon Note" is a Note that provides for the
periodic accretion of principal instead of the payment of interest,
and that is offered at a discount from the principal amount
thereof. A Floating Rate Note may also have either or both of the
following: (a) a maximum numerical interest rate limitation, or
ceiling, on the rate of interest which may accrue during any
interest period; and (b) a minimum numerical interest rate
limitation, or floor, on the rate of interest which may accrue
during any interest period. The "Spread" is the number of basis
points specified in the applicable Pricing Supplement as being
applicable to the interest rate for such Floating Rate Note and the
"Spread Multiplier" is the percentage specified in the applicable
Pricing Supplement as being applicable to the interest rate for
such Floating Rate Note. "Business Day" means (a) with respect to
any Note, any day which is not a Saturday or Sunday and which in
the City of San Francisco or The City of New York is neither a
legal holiday nor a day on which banking institutions are
authorized by law or regulation to close, and (b) with respect to
LIBOR Notes only, any such day on which dealings in deposits in
U.S. dollars are transacted in the London interbank market (a
"London Business Day"). "Index Maturity" means, with respect to a
Floating Rate Note, the period to maturity of the instrument or
obligation on which the interest rate formula is based, as
specified in the applicable Pricing Supplement.
The applicable Pricing Supplement relating to a Fixed
Rate Note will designate the rate of interest per annum payable on
such Fixed Rate Note. The applicable Pricing Supplement relating
to a Floating Rate Note will designate an interest rate basis for
such Floating Rate Note. Such basis may be: (a) the Commercial
Paper Rate, in which case such Note will be a Commercial Paper Rate
Note, (b) the Prime Rate, in which case such Note will be a Prime
Rate Note, (c) LIBOR, in which case such Note will be a LIBOR Note,
(d) the Treasury Rate, in which case such Note will be a Treasury
Rate Note, (e) the Certificate of Deposit Rate ("CD Rate"), in
which case such Note will be a CD Rate Note, (f) the CMT Rate ("CMT
Rate"), in which case such Note will be a CMT Rate Note, (g) the
Federal Funds Effective Rate, in which case such Note will be a
Federal Funds Rate Note, or (h) such other interest rate formula as
is set forth in such Pricing Supplement. The applicable Pricing
Supplement for a Floating Rate Note also will specify, if
applicable: the interest rate basis and the Spread and/or Spread
Multiplier, Interest Calculation Date, the Initial Interest Rate,
the Index Maturity, the Interest Determination Date, the Interest
Reset Date (all as defined below), and the maximum or minimum
interest rate limitation applicable to each Floating Rate Note. In
addition, each Pricing Supplement will define or particularize for
each Note the following terms, if applicable: Interest Payment
Dates, Regular Record Date, Earliest Redemption Date, Repayment
Dates, the principal amount, the issue price, the Stated Maturity,
and any redemption premium.
The rate of interest on each Floating Rate Note will be
reset daily, weekly, monthly, quarterly, semi-annually or annually
(each an "Interest Reset Date"), as specified in the applicable
Pricing Supplement. Unless otherwise specified in the applicable
Pricing Supplement, the Interest Reset Date will be, in the case of
Floating Rate Notes which reset daily, each Business Day; in the
case of Floating Rate Notes (other than Treasury Rate Notes) which
reset weekly, the Wednesday of each week; in the case of Treasury
Rate Notes which reset weekly, the Tuesday of each week (except as
set forth in the last sentence of the next succeeding paragraph
below); in the case of Floating Rate Notes which reset monthly, the
third Wednesday of each month; in the case of Floating Rate Notes
which reset quarterly, the third Wednesday of March, June,
September and December; in the case of Floating Rate Notes which
reset semi-annually, the third Wednesday of two months of each year
that are six months apart, as specified in the applicable Pricing
Supplement; and in the case of Floating Rate Notes which reset
annually, the third Wednesday of one month of each year, as
specified in the applicable Pricing Supplement; provided, however,
that (a) the interest rate in effect from the date of issuance to
the first Interest Reset Date with respect to a Floating Rate Note
will be the Initial Interest Rate and (b) the interest rate in
effect for the ten days immediately prior to maturity, redemption
or repayment will be that in effect on the tenth day preceding such
maturity, redemption or repayment. If any Interest Reset Date for
any Floating Rate Note would otherwise be a day that is not a
Business Day for such Floating Rate Note, the Interest Reset Date
for such Floating Rate Note shall be postponed to the next day that
is a Business Day for such Floating Rate Note, except that in the
case of a LIBOR Note, if such Business Day is in the next
succeeding
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calendar month, such Interest Reset Date shall be the immediately
preceding Business Day. "Initial Interest Rate" means the rate at
which a Floating Rate Note will bear interest from its Issue Date
to the first Interest Reset Date, as indicated in the applicable
Pricing Supplement.
The Interest Determination Date pertaining to an Interest
Reset Date for (a) a Commercial Paper Rate Note (the "Commercial
Paper Interest Determination Date"), (b) a Prime Rate Note (the
"Prime Rate Interest Determination Date"), (c) a CD Rate Note (the
"CD Interest Determination Date"), (d) a CMT Rate Note (the "CMT
Rate Interest Determination Date") and (e) a Federal Funds Rate
Note (the "Federal Funds Interest Determination Date") will be the
second Business Day preceding the Interest Reset Date with respect
to such Note. The Interest Determination Date pertaining to an
Interest Reset Date for a LIBOR Note (the "LIBOR Interest
Determination Date") will be the second London Business Day
preceding such Interest Reset Date. The Interest Determination
Date pertaining to an Interest Reset Date for a Treasury Rate Note
(the "Treasury Interest Determination Date") will be the day of the
week in which such Interest Reset Date falls on which Treasury
bills would normally be auctioned. Treasury bills are usually sold
at auction on Monday of each week, unless that day is a legal
holiday, in which case the auction is usually held on the following
Tuesday, except that such auction may be held on the preceding
Friday. If, as the result of a legal holiday, an auction is so
held on the preceding Friday, such Friday will be the Treasury
Interest Determination Date pertaining to the Interest Reset Date
occurring in the next succeeding week. If an auction date shall
fall on any Interest Reset Date for a Treasury Rate Note, then such
Interest Reset Date shall instead be the first Business Day
immediately following such auction date.
Unless otherwise indicated in the applicable Pricing
Supplement and except as provided below, interest will be payable,
in the case of Floating Rate Notes which reset daily, weekly or
monthly, on the third Wednesday of each month or on the third
Wednesday of March, June, September and December of each year (as
indicated in the applicable Pricing Supplement); in the case of
Floating Rate Notes which reset quarterly, on the third Wednesday
of March, June, September and December of each year; in the case of
Floating Rate Notes which reset semi-annually, on the third
Wednesday of the two months of each year specified in the
applicable Pricing Supplement; and in the case of Floating Rate
Notes which reset annually, on the third Wednesday of the month
specified in the applicable Pricing Supplement (each an "Interest
Payment Date"), and in each case, at any Redemption Date or
Repayment Date and any Stated Maturity. If an Interest Payment
Date with respect to any Floating Rate Note (other than an Interest
Payment Date that falls on a Redemption Date or a Repayment Date
with respect to the principal amount due and payable on such date,
and other than the Stated Maturity) would otherwise fall on a day
that is not a Business Day with respect to such Note, such Interest
Payment Date will be postponed to the following day that is a
Business Day with respect to such Note, except that in the case of
a LIBOR Note, if such Business Day falls in the next calendar
month, such Interest Payment Date will be the preceding day that is
a Business Day with respect to such LIBOR Note.
Interest payments shall be for the amount of interest
accrued to, but excluding, the Interest Payment Date; provided,
however, that if the Interest Reset Dates with respect to any Note
are daily or weekly, interest payable on any Interest Payment Date,
other than interest payable on any date on which principal on any
such Note is payable, will include interest accrued to and
including the immediately preceding Regular Record Date. With
respect to a Floating Rate Note, accrued interest from the date of
issue or from the last date to which interest has been paid is
calculated by multiplying the face amount of such Floating Rate
Note by an accrued interest factor. Such accrued interest factor
is computed by adding the interest factor calculated for each day
from the date of issue, or from the last date to which interest has
been paid, to the date for which accrued interest is being
calculated. The interest factor (expressed as a decimal rounded
upwards if five one-millionths or more of a percentage point and
rounded downwards if less than five one-millionths of a percentage
point, if necessary, to the next higher or lower, as the case may
be, one hundred-thousandth of a percentage point (e.g., 9.876545%
or .09876545 being rounded to 9.87655% or .0987655, respectively))
for each such day is computed by dividing the interest rate
(expressed as a decimal rounded upwards if five one-millionths or
more of a percentage point and downwards if less than five one-
millionths of a percentage point, if necessary, to the next higher
or lower, as the case may be, one hundred-thousandth of a
percentage point) applicable to such date by 360, in the case of
Commercial Paper Rate Notes, Prime Rate Notes, LIBOR Notes, CD Rate
Notes, CMT Rate Notes or Federal Funds Rate Notes, or by the actual
number of days in the year, in the case of Treasury Rate
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Notes. All dollar amounts used in or resulting from such
calculation on Floating Rate Notes will be rounded to the nearest
cent (with one-half cent being rounded upwards).
Upon the request of the holder of any Floating Rate Note,
the Calculation Agent will provide the interest rate then in
effect, and, if different, the interest rate which will become
effective as a result of a determination made on the most recent
Interest Determination Date with respect to such Floating Rate
Note.
Any payment of principal, premium, if any, or interest
required to be made on an Interest Payment Date, any Redemption
Date or Repayment Date or at the Stated Maturity of a Note which is
not a Business Day need not be made on such day, but may be made on
the next succeeding Business Day with the same force and effect as
if made on the Interest Payment Date, Redemption Date or Repayment
Date or the Stated Maturity, as the case may be, and no interest
shall accrue for the period from and after such Interest Payment
Date, Redemption Date or Repayment Date or the Stated Maturity.
Unless otherwise specified in an applicable Pricing
Supplement, the "Interest Calculation Date", where applicable,
pertaining to any Interest Determination Date will be the earlier
of (a) the tenth calendar day after such Interest Determination
Date, or, if any such day is not a Business Day, the next
succeeding Business Day, or (b) the Business Day preceding the
applicable Interest Payment Date, Redemption Date, Repayment Date
or Stated Maturity, as the case may be.
Fixed Rate Notes
Each Fixed Rate Note will bear interest from the date of
issue at the annual rate or rates stated on the face thereof.
Unless otherwise specified in the applicable Pricing Supplement,
the Interest Payment Dates for a Fixed Rate Note will be April 1
and October 1 of each year and any Redemption Date or Repayment
Date and the Stated Maturity. Unless otherwise specified in the
applicable Pricing Supplement, the Regular Record Dates will be on
March 15 or September 15 next preceding the April 1 and October 1
Interest Payment Dates. Interest on Fixed Rate Notes will be
calculated on the basis of a 360-day year of twelve 30-day months.
Commercial Paper Rate Notes
Commercial Paper Rate Notes will bear interest at the
interest rates (calculated with reference to the Commercial Paper
Rate and the Spread and/or Spread Multiplier, if any), and will be
payable on the dates, specified on the face of the Commercial Paper
Rate Note and in the applicable Pricing Supplement.
Unless otherwise indicated in the applicable Pricing
Supplement, "Commercial Paper Rate" means, with respect to any
Commercial Paper Interest Determination Date, the Money Market
Yield (calculated as described below) of the rate on such date for
commercial paper having the Index Maturity specified in the
applicable Pricing Supplement as published by the Board of
Governors of the Federal Reserve System in "Statistical Release
H.15(519), Selected Interest Rates" or any successor publication of
the Board of Governors of the Federal Reserve System ("H.15(519)")
under the heading "Commercial Paper." In the event that such rate
is not published prior to 3:00 P.M. New York City time on the
Interest Calculation Date pertaining to such Commercial Paper
Interest Determination Date, then the Commercial Paper Rate shall
be the Money Market Yield of the rate on such Commercial Paper
Interest Determination Date for commercial paper having the Index
Maturity specified in the applicable Pricing Supplement as
published by the Federal Reserve Bank of New York in its daily
statistical release, "Composite 3:30 P.M. Quotations for U.S.
Government Securities" ("Composite Quotations") under the heading
"Commercial Paper." If by 3:00 P.M. New York City time on such
Interest Calculation Date such rate is not yet published in either
H.15(519) or Composite Quotations, the rate for that Commercial
Paper Interest Determination Date shall be calculated by the
Calculation Agent and shall be the Money Market Yield of the
arithmetic mean (rounded to the nearest one hundred-thousandth of a
percentage point) of the offered rates, as of 11:00 A.M. New York
City time, on that Commercial Paper Interest Determination Date, of
three leading dealers of commercial paper in The City of New York
selected by the Calculation Agent for commercial paper of the Index
Maturity specified in the applicable Pricing Supplement
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placed for an industrial issuer whose bond rating is "AA," or the
equivalent, from a nationally recognized rating agency; provided,
however, that if the dealers selected as aforesaid by the
Calculation Agent are not quoting as mentioned in this sentence,
the Commercial Paper Rate will be the Commercial Paper Rate then in
effect on such Commercial Paper Interest Determination Date.
"Money Market Yield" shall be a yield (expressed as a
percentage rounded to the next higher one hundred-thousandth of a
percentage point) calculated in accordance with the following
formula:
D x 360 x 100
Money Market Yield = _______________
360 - (D x M)
where "D" refers to the per annum rate for commercial paper quoted
on a bank discount basis and expressed as a decimal; and "M" refers
to the actual number of days in the interest period for which
interest is being calculated.
Prime Rate Notes
Prime Rate Notes will bear interest at the interest rates
(calculated with reference to the Prime Rate and the Spread and/or
Spread Multiplier, if any), and will be payable on the dates,
specified on the face of the Prime Rate Note and in the applicable
Pricing Supplement.
Unless otherwise indicated in the applicable Pricing
Supplement, "Prime Rate" means, with respect to any Prime Rate
Interest Determination Date, the rate set forth on such date in
H.15(519) under the heading "Bank Prime Loan." In the event that
such rate is not published prior to 9:00 A.M., New York City time,
on the Interest Calculation Date pertaining to such Prime Rate
Interest Determination Date, then the Prime Rate will be determined
by the Calculation Agent and will be the arithmetic mean of the
rates of interest publicly announced by each bank that appears on
the Reuters Screen NYMF Page (as defined below) as such bank's
prime rate or base lending rate as in effect for that Prime Rate
Interest Determination Date. If fewer than four such rates but
more than one such rate appear on the Reuters Screen NYMF Page for
the Prime Rate Interest Determination Date, the Prime Rate will be
determined by the Calculation Agent and will be the arithmetic mean
of the prime rates quoted on the basis of the actual number of days
in the year divided by a 360-day year as of the close of business
on such Prime Rate Interest Determination Date by four major money
center banks in The City of New York selected by the Calculation
Agent. If fewer than two such rates appear on the Reuters Screen
NYMF Page, the Prime Rate will be determined by the Calculation
Agent on the basis of the rates furnished in The City of New York
by the appropriate number of substitute banks or trust companies
organized and doing business under the laws of the United States,
or any State thereof, having total equity capital of at least U.S.
$500,000,000 and being subject to supervision or examination by
Federal or State authority, selected by the Calculation Agent to
provide such rate or rates; provided, however, that if the banks
selected as aforesaid are not quoting as mentioned in this
sentence, the Prime Rate will remain the Prime Rate in effect on
such Prime Rate Interest Determination Date. "Reuters Screen NYMF
Page" means the display designated as page "NYMF" on the Reuters
Monitor Money Rates Service (or such other page as may replace the
NYMF page on that service for the purpose of displaying prime rates
or base lending rates of major United States banks).
LIBOR Notes
"LIBOR" Notes will bear interest at the interest rates
(calculated with reference to LIBOR and the Spread and/or Spread
Multiplier, if any), and will be payable on the dates, specified on
the face of the LIBOR Note and in the applicable Pricing
Supplement.
Unless otherwise indicated in the applicable Pricing
Supplement, LIBOR will be determined by the Calculation Agent in
accordance with the following provisions:
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(a) With respect to any LIBOR Interest
Determination Date, either, as specified in the applicable Pricing
Supplement: (i) the arithmetic mean of the offered rates for
deposits in U.S. dollars for the period of the Index Maturity
specified in the applicable Pricing Supplement, commencing on the
second London Business Day immediately following such LIBOR
Interest Determination Date, which appear on the Reuters Screen
LIBO Page as of 11:00 A.M., London time, on the LIBOR Interest
Determination Date, if at least two such offered rates appear on
the Reuters Screen LIBO Page ("LIBOR Reuters"), or (ii) the rate
for deposits in U.S. dollars having the Index Maturity designated
in the applicable Pricing Supplement, commencing on the second
London Business Day immediately following that LIBOR Interest
Determination Date, that appears on the Telerate Page 3750 as of
11:00 A.M., London time, on that LIBOR Interest Determination Date
("LIBOR Telerate"). Unless otherwise indicated in the applicable
Pricing Supplement, "Reuters Screen LIBO Page" means the display
designated as Page "LIBO" on the Reuters Monitor Money Rate Service
(or such other page as may replace the LIBO page on that service
for the purpose of displaying London interbank offered rates of
major banks). "Telerate Page 3750" means the display designated as
page "3750" on the Telerate Service (or such other page as may
replace the 3750 page on that service or such other service or
services as may be nominated by the British Bankers' Association
for the purpose of displaying London interbank offered rates for
U.S. dollar deposits). If neither LIBOR Reuters nor LIBOR Telerate
is specified in the applicable Pricing Supplement, LIBOR will be
determined as if LIBOR Telerate had been specified. If fewer than
two offered rates appear on the Reuters Screen LIBO Page, or if no
rate appears on the Telerate Page 3750, as applicable, LIBOR in
respect of that LIBOR Interest Determination Date will be
determined as if the parties had specified the rate described in
(b) below.
(b) With respect to a LIBOR Interest Determination
Date on which fewer than two offered rates appear on the Reuters
Screen LIBO Page, as described in (a)(i) above, or on which no rate
appears on the Telerate Page 3750, as specified in (a)(ii) above,
as applicable, LIBOR will be determined on the basis of the rates
at which deposits in U.S. dollars having the Index Maturity
designated in the applicable Pricing Supplement are offered at
approximately 11:00 A.M., London time, on such LIBOR Interest
Determination Date by four major banks ("Reference Banks") in the
London interbank market selected by the Calculation Agent (after
consultation with the Company) to prime banks in the London
interbank market commencing on the second London Business Day
immediately following such LIBOR Interest Determination Date and in
a principal amount of not less than U.S. $1,000,000 that is
representative for a single transaction in such market at such
time. The Calculation Agent will request the principal London
office of each of the Reference Banks to provide a quotation of its
rate. If at least two such quotations are provided, LIBOR for such
LIBOR Interest Determination Date will be the arithmetic mean
(rounded to the nearest one hundred-thousandth of a percentage
point) of such quotations. If fewer than two quotations are
provided, LIBOR for such LIBOR Interest Determination Date will be
the arithmetic mean (rounded to the nearest one hundred-thousandth
of a percentage point) of the rates quoted at approximately 11:00
A.M., New York City time, on such LIBOR Interest Determination Date
by three major banks (which may include the Agents) in The City of
New York selected by the Calculation Agent (after consultation with
the Company) for loans in U.S. dollars to leading European banks
having the specified Index Maturity designated in the applicable
Pricing Supplement commencing on the second London Business Day
immediately following such LIBOR Interest Determination Date and in
a principal amount equal to an amount of not less than U.S.
$1,000,000 that is representative for a single transaction in such
market at such time; provided, however, that if the banks selected
as aforesaid by the Calculation Agent are not quoting as mentioned
in this sentence, LIBOR will be LIBOR then in effect on such LIBOR
Interest Determination Date.
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Treasury Rate Notes
Treasury Rate Notes will bear interest at the interest
rates (calculated with reference to the Treasury Rate and the
Spread and/or Spread Multiplier, if any) and will be payable on the
dates, specified on the face of the Treasury Rate Note and in the
applicable Pricing Supplement.
Unless otherwise indicated in the Pricing Supplement,
"Treasury Rate" means, with respect to any Treasury Interest
Determination Date, the rate for the most recent auction of direct
obligations of the United States ("Treasury bills") having the
Index Maturity specified in the applicable Pricing Supplement as
published in H.15(519) under the heading, "U.S. Government
Securities-Treasury Bills/Auction Average (Investment)" or, if not
so published by 3:00 P.M., New York City time, on the Interest
Calculation Date pertaining to such Treasury Interest Determination
Date, the auction average rate (expressed as a bond equivalent,
rounded to the nearest one hundred-thousandth of a percentage
point, on the basis of a year of 365 or 366 days, as applicable,
and applied on a daily basis) for such auction as otherwise
announced by the United States Department of the Treasury. In the
event that the results of the auction of Treasury bills having the
Index Maturity designated in the applicable Pricing Supplement are
not published or reported as provided above by 3:00 P.M., New York
City time, on such Interest Calculation Date, or if no such auction
is held in that particular week, then the Treasury Rate shall be
calculated by the Calculation Agent and shall be a yield to
maturity (expressed as a bond equivalent, rounded to the nearest
one hundred-thousandth of a percentage point, on the basis of a
year of 365 or 366 days, as applicable, and applied on a daily
basis) of the arithmetic mean of the secondary market bid rates as
of approximately 3:30 P.M., New York City time, on such Treasury
Interest Determination Date, of three leading primary United States
government securities dealers selected by the Calculation Agent,
for the issue of Treasury bills with a remaining maturity closest
to the specified Index Maturity; provided, however, that if the
dealers selected as aforesaid by the Calculation Agent are not
quoting as mentioned in this sentence, the Treasury Rate will be
the Treasury Rate in effect on such Treasury Interest Determination
Date.
CD Rate Notes
CD Rate Notes will bear interest at the interest rate
(calculated with reference to the CD Rate and the Spread and/or
Spread Multiplier, if any), and will be payable on the dates,
specified on the face of the CD Rate Note and in the applicable
Pricing Supplement.
Unless otherwise indicated in the applicable Pricing
Supplement, "CD Rate" means, with respect to any CD Interest
Determination Date, the rate on such date for negotiable
certificates of deposit having the Index Maturity specified in the
applicable Pricing Supplement as published in H.15(519) under the
heading "CDs (Secondary Market)." In the event that such rate is
not so published by 3:00 P.M., New York City time, on the Interest
Calculation Date pertaining to such CD Interest Determination Date,
the CD Rate will be the rate on such CD Interest Determination Date
for negotiable certificates of deposit having the Index Maturity
specified in the applicable Pricing Supplement as published in
Composite Quotations under the heading "Certificates of Deposit."
If such rate is neither published in H.15(519) nor in Composite
Quotations by 3:00 P.M., New York City time, on such Interest
Calculation Date the CD Rate for such CD Interest Determination
Date will be calculated by the Calculation Agent and will be the
arithmetic mean of the secondary market offered rates as of
10:00 A.M., New York City time, on such CD Interest Determination
Date, of three leading nonbank dealers of negotiable U.S. dollar
certificates of deposit in The City of New York selected by the
Calculation Agent for negotiable certificates of deposit of major
United States money center banks (in the market for negotiable
certificates of deposit) with a remaining maturity closest to the
Index Maturity specified in the applicable Pricing Supplement in a
denomination of U.S. $5,000,000; provided, however, that if the
dealers selected as aforesaid by the Calculation Agent are not
quoting as mentioned in this sentence, the CD Rate will be the CD
Rate in effect on such CD Interest Determination Date.
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CMT Rate Notes
CMT Rate Notes will bear interest at the interest rate
(calculated with reference to the CMT Rate and the Spread and/or
Spread Multiplier, if any), and will be payable on the dates,
specified on the face of the CMT Rate Note and in the applicable
Pricing Supplement.
Unless otherwise indicated in the applicable Pricing
Supplement, "CMT Rate" means, with respect to any CMT Rate Interest
Determination Date, the rate displayed on the Designated CMT
Telerate Page under the caption " . . . Treasury Constant
Maturities . . . Federal Reserve Board Release H.15 . . . Mondays
Approximately 3:45 P.M.," under the column for the Designated CMT
Maturity Index for (i) if the Designated CMT Telerate Page is 7055,
the rate on such CMT Rate Interest Determination Date and (ii) if
the Designated CMT Telerate Page is 7052, the rate for the week, or
the month, as applicable, ended immediately preceding the week in
which the related CMT Rate Interest Determination Date occurs. If
such rate is no longer displayed on the relevant page, or if not
displayed by 3:00 P.M., New York City time, on the related Interest
Calculation Date, then the CMT Rate for such CMT Rate Interest
Determination Date will be such Treasury Constant Maturity rate for
the Designated CMT Maturity Index as published in the relevant
H.15(519). If such rate is no longer published, or if not
published by 3:00 P.M., New York City time, on the related Interest
Calculation Date, then the CMT Rate for such CMT Rate Interest
Determination Date will be such Treasury Constant Maturity rate for
the Designated CMT Maturity Index (or other United States Treasury
rate for the Designated CMT Maturity Index) for the CMT Rate
Interest Determination Date with respect to such Interest Reset
Date as may then be published by either the Board of Governors of
the Federal Reserve System or the United States Department of the
Treasury that the Calculation Agent determines to be comparable to
the rate formerly displayed on the Designated CMT Telerate Page and
published in the relevant H.15(519). If such information is not
provided by 3:00 P.M., New York City time, on the related Interest
Calculation Date, then the CMT Rate for the CMT Rate Interest
Determination Date will be calculated by the Calculation Agent and
will be a yield to maturity, based on the arithmetic mean (rounded
to the nearest one hundred-thousandth of a percentage point) of the
secondary market closing offer side prices as of approximately
3:30 P.M., New York City time, on the CMT Rate Interest
Determination Date reported, according to their written records, by
three leading primary United States government securities dealers
(each, a "Reference Dealer") in The City of New York (which may
include the Agents) selected by the Calculation Agent (from five
such Reference Dealers selected by the Calculation Agent and
eliminating the highest quotation (or, in the event of equality,
one of the highest) and the lowest quotation (or, in the event of
equality, one of the lowest)), for the most recently issued direct
noncallable fixed rate obligations of the United States ("Treasury
Note") with an original maturity of approximately the Designated
CMT Maturity Index and a remaining term to maturity of not less
than such Designated CMT Maturity Index minus one year. If the
Calculation Agent cannot obtain three such Treasury Note
quotations, the CMT Rate for such CMT Rate Interest Determination
Date will be calculated by the Calculation Agent and will be a
yield to maturity based on the arithmetic mean (rounded to the
nearest one hundred-thousandth of a percentage point) of the
secondary market offer side prices as of approximately 3:30 P.M.,
New York City time, on the CMT Rate Interest Determination Date of
three Reference Dealers in The City of New York (from five such
Reference Dealers selected by the Calculation Agent and eliminating
the highest quotation (or, in the event of equality, one of the
highest) and the lowest quotation (or, in the event of equality,
one of the lowest)), for Treasury Notes with an original maturity
of the number of years that is the next highest to the Designated
CMT Maturity Index and a remaining term to maturity closest to the
Designated CMT Maturity Index and in an amount of at least $100
million. If three or four (and not five) of such Reference Dealers
are quoting as described above, then the CMT Rate will be based on
the arithmetic mean (rounded to the nearest one hundred-thousandth
of a percentage point) of the offer prices obtained and neither the
highest nor lowest of such quotes will be eliminated; provided,
however, that if fewer than three Reference Dealers selected by the
Calculation Agent are quoting as described herein, the CMT Rate
will be the CMT Rate in effect on such CMT Rate Interest
Determination Date. If two Treasury Notes with an original
maturity as described in the third preceding sentence have
remaining terms to maturity equally close to the Designated CMT
Maturity Index, the quotes for the CMT Rate Note with the shorter
remaining term to maturity will be used.
"Designated CMT Telerate Page" means the display on the
Dow Jones Telerate Service on the page designated in the applicable
Pricing Supplement (or any other page as may replace such page on
that
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service for the purpose of displaying Treasury Constant Maturities
as reported in H.15(519)), for the purpose of displaying Treasury
Constant Maturities as reported in H.15(519). If no such page is
specified in the applicable Pricing Supplement, the Designated CMT
Telerate Page shall be 7052, for the most recent week.
"Designated CMT Maturity Index" means the original period
to maturity of the U.S. Treasury securities (either 1, 2, 3, 5, 7,
10, 20 or 30 years) specified in the applicable Pricing Supplement
with respect to which the CMT Rate will be calculated. If no such
maturity is specified in the applicable Pricing Supplement, the
Designated CMT Maturity Index shall be 2 years.
Federal Funds Rate Notes
Federal Funds Rate Notes will bear interest at the
interest rate (calculated with reference to the Federal Funds
Effective Rate and the Spread and/or Spread Multiplier, if any),
and will be payable on the dates, specified on the face of the
Federal Funds Rate Note and in the applicable Pricing Supplement.
Unless otherwise indicated in the applicable Pricing
Supplement, "Federal Funds Effective Rate" means, with respect to
any Federal Funds Interest Determination Date, the rate on that
date for Federal Funds as published in H.15(519) under the heading
"Federal Funds (Effective)." In the event that such rate is not so
published by 3:00 P.M., New York City time, on the Interest
Calculation Date pertaining to such Federal Funds Interest
Determination Date, the Federal Funds Effective Rate will be the
rate on such Federal Funds Interest Determination Date as published
in Composite Quotations under the heading "Federal Funds/Effective
Rate." If such rate is neither published in H.15(519) nor in
Composite Quotations by 3:00 P.M., New York City time, on such
Interest Calculation Date, the Federal Funds Effective Rate for
such Federal Funds Interest Determination Date will be calculated
by the Calculation Agent and will be the arithmetic mean of the
rates as of 9:00 A.M., New York City time, on such Federal Funds
Interest Determination Date for the last transaction in overnight
Federal Funds arranged by three leading brokers of Federal Funds
transactions in The City of New York selected by the Calculation
Agent; provided, however, that if the brokers selected as aforesaid
by the Calculation Agent are not quoting as mentioned in this
sentence, the Federal Funds Effective Rate will be the Federal
Funds Effective Rate in effect on such Federal Funds Interest
Determination Date.
OTHER PROVISIONS; ADDENDA
Any provision with respect to the determination or
calculation of the interest rate or interest rate formula
applicable to any Floating Rate Note, the Interest Payment Dates of
any Note or any other variable term of a Note to be issued by the
Company may be modified by the terms as specified under "Other
Provisions" on the face thereof or in an Addendum relating thereto,
if so specified on the face thereof or in an Addendum thereto and
in the applicable Pricing Supplement.
BOOK-ENTRY NOTES
Upon issuance, all Book-Entry Notes having the same
ranking (senior or subordinated), original issuance date, Interest
Payment Dates, redemption or repayment provisions, if any, original
issue discount provisions, if any, Stated Maturity and in the case
of Fixed Rate Notes, interest rate, or in the case of Floating Rate
Notes, Initial Interest Rate, interest rate formula, Index
Maturity, Spread and/or Spread Multiplier (if any), minimum
interest rate limitation (if any), maximum interest rate limitation
(if any) and Interest Reset Dates, will be represented by a single
global security ("Global Security"). Each Global Security
representing Book-Entry Notes will be deposited with, or on behalf
of, The Depository Trust Company, as Depositary (the "Depositary"),
and registered in the name of a nominee of the Depositary. Book-
Entry Notes will not be exchangeable for Certificated Notes,
provided that if the Depositary is at any time unwilling or unable
to continue as depositary and a successor depositary is not
appointed by the Company within 90 days, the Company will issue
Certificated Notes in exchange for the Global Security or
Securities representing Book-Entry Notes. In addition, the Company
may at any time and in its sole discretion determine not to have
Book-Entry Notes represented by
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Global Securities, and, in such event, will issue Certificated
Notes in exchange for all Global Securities representing such Book-
Entry Notes.
A further description of the Depositary's procedures with
respect to Global Securities representing Book-Entry Notes is set
forth in the attached Prospectus under "Description of Notes--
Global Securities." The Depositary has confirmed to the Company
and the Trustees that it intends to follow such procedures.
REDEMPTION OR REPAYMENT
The Notes are not subject to redemption by the Company
prior to the Earliest Redemption Date, if any, fixed at the time of
sale and set forth in the applicable Pricing Supplement. If no
Earliest Redemption Date is indicated with respect to a Note, such
Note is not redeemable prior to its Stated Maturity. On and after
the indicated Earliest Redemption Date, the Note will be redeemable
in whole or in part in increments of $1,000 (provided that any
remaining principal amount of any Note shall be at least $1,000) at
the option of the Company at a redemption price set forth in the
applicable Pricing Supplement at the Earliest Redemption Date and
at each anniversary thereafter at the prior Redemption Price less
the Annual Redemption Price Reduction indicated in the applicable
Pricing Supplement, or if no such redemption price is set forth, at
100% of the principal amount to be redeemed (unless otherwise
provided in the applicable Pricing Supplement), together with
accrued interest thereon payable to the Redemption Date. The
Company will redeem the specified portion of the principal amount
of a Note ("Sinking Fund Amount") on the sinking fund redemption
dates, if any, set forth in the applicable Pricing Supplement
("Sinking Fund Redemption Date") together with accrued interest to
the applicable Sinking Fund Redemption Date. If no Sinking Fund
Amount is set forth in the applicable Pricing Supplement, the
Company will not have any obligation to redeem such Note before its
Stated Maturity. The Company may reduce the Sinking Fund Amount to
be redeemed on any Sinking Fund Redemption Date by subtracting 100%
of the principal amount (excluding premium) of any Note surrendered
to the Trustee for cancellation of which the Company becomes the
beneficial owner or that the Company has otherwise redeemed or
repaid other than pursuant to the second preceding sentence. The
Company may so credit the same principal amount of such Note only
once. Notice of any redemption will be given not more than 60 nor
less than 30 days prior to the Redemption Date. In case of redemp-
tion at the option of the Company of less than all of the Notes at
the time outstanding the Company may, by written notice to the
Senior or Subordinated Trustee, as the case may be, direct that
Notes to be redeemed shall be selected from among groups of such
Notes having specified tenor or terms and the Senior or
Subordinated Trustee, as the case may be, shall thereafter select
the particular Notes to be redeemed in such manner as the Senior or
Subordinated Trustee, as the case may be, deems fair, as provided
in the Indenture.
In addition, the applicable Pricing Supplement will
indicate either that the Company will be obligated to purchase a
Note at the option of the holder thereof or that the Company will
not be so obligated. If the Company will be so obligated, the
applicable Pricing Supplement will set forth the date or dates
(each a "Repayment Date") and the price or prices at which the
applicable Notes will be purchased, in whole or in part, pursuant
to such obligation.
FEDERAL TAX CONSIDERATIONS
The following summary of certain United States federal
income tax consequences of the purchase, ownership and disposition
of the Notes is based on laws, regulations, rulings and decisions
now in effect, all of which are subject to change or possible
differing interpretations. It deals only with Notes held as
capital assets and does not deal with persons in special tax
situations, such as financial institutions, insurance companies,
regulated investment companies, dealers in securities or
currencies, persons holding Notes as a hedge against currency risks
or as a position in a "straddle" for tax purposes, or persons whose
functional currency is not the United States dollar. This
discussion does not generally deal with tax consequences to holders
other than original purchasers. Persons considering the purchase
of the Notes should consult their own tax advisors concerning the
application of United States federal income tax laws to their
particular situations as well as any
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consequences of the purchase, ownership and disposition of the
Notes arising under the laws of any other taxing jurisdiction.
As used herein, the term "U.S. Holder" means a beneficial
owner of a Note that is for United States federal income tax
purposes (i) a citizen or resident of the United States, (ii) a
corporation, partnership or other entity created or organized in or
under the laws of the United States or of any political subdivision
thereof, (iii) an estate or trust the income of which is subject to
United States federal income taxation regardless of its source or
(iv) any other person whose income or gain in respect of a Note is
effectively connected with the conduct of a United States trade or
business. As used herein, the term "non-U.S. Holder" means a
holder of a Note that is not a U.S. Holder.
U.S. HOLDERS
Payments of Interest
Payments of interest on a Note generally will be taxable
to a U.S. Holder as ordinary interest income at the time such
payments are accrued or are received (in accordance with the U.S.
Holder's method of accounting for tax purposes).
Original Issue Discount
The following summary is a general discussion of the
United States federal income tax consequences to U.S. Holders of
the purchase, ownership and disposition of Notes issued with
original issue discount ("Discount Notes"). The following summary
is based, in part, upon final Treasury regulations released by the
Internal Revenue Service ("IRS") on January 27, 1994, prescribing
rules of accounting for original issue discount. The final
regulations, which replaced certain proposed original issue
discount regulations that were issued on December 21, 1992,
generally apply to debt instruments issued on or after April 4,
1994. In addition, taxpayers may rely on such regulations for debt
instruments issued after December 21, 1992.
For United States federal income tax purposes, "original
issue discount" is defined as the excess of the stated redemption
price at maturity of a Note over its issue price, if such excess
equals or exceeds a de minimis amount (generally 1/4 of 1% of the
Note's stated redemption price at maturity multiplied by the number
of complete years to its maturity from its issue date). The issue
price of an issue of Notes will generally equal the first price at
which a substantial amount of such Notes are sold. The stated
redemption price at maturity of a Note is the sum of all payments
provided by the Note other than "qualified stated interest"
payments. The term "qualified stated interest" generally means
stated interest that is unconditionally payable in cash or property
(other than debt instruments of the issuer) at least annually at a
single fixed rate or at current values of (i) one or more qualified
floating rates, (ii) a single fixed rate and one or more qualified
floating rates, (iii) a single objective rate, or (iv) a single
fixed rate and a single objective rate that is a qualified inverse
floating rate. A "qualified floating rate" is generally any
floating rate where variations in such rate can reasonably be
expected to measure contemporaneous variations in the cost of newly
borrowed funds in the currency in which the Note is denominated.
An "objective rate" is a rate that is not itself a qualified
floating rate but which is determined using a single fixed formula
and which is based upon (i) one or more qualified floating rates
(e.g., a multiple of a qualified floating rate), (ii) either the
yield or changes in the price of one or more items of actively
traded personal property, (iii) one or more rates where each rate
would be a qualified floating rate for a debt instrument
denominated in a currency other than the currency in which the Note
is denominated, or (iv) a combination of the rates described in
items (i) through (iii). An objective rate is a "qualified inverse
floating rate" if the rate is equal to a fixed rate minus a
qualified floating rate and the variations in the rate can
reasonably be expected to reflect contemporaneous variations in the
cost of newly borrowed funds.
A U.S. Holder of a Discount Note must include original
issue discount in income for United States federal income tax
purposes as it accrues under a constant yield method in advance of
receipt of the cash payments attributable to such income,
regardless of such U.S. Holder's method of accounting for tax
purposes.
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In general, the amount of original issue discount included in
income by the initial holder of a Discount Note is the sum of the
"daily portions" of original issue discount with respect to such
Note for each day during the taxable year on which such holder held
such Note. The daily portion of original issue discount on any
Discount Note is determined by allocating to each day in any
"accrual period" a ratable portion of the original issue discount
allocable to that accrual period. An accrual period may be of any
length and the accrual periods may vary in length over the term of
the debt instrument, provided that each accrual period is no longer
than one year and each scheduled payment of principal or interest
occurs on the first day or the final day of an accrual period. The
amount of original issue discount allocable to each accrual period
is equal to the difference between (i) the product of the Discount
Note's adjusted issue price at the beginning of such accrual period
and its yield to maturity (determined on the basis of compounding
at the close of each accrual period and appropriately adjusted to
take into account the length of the particular accrual period) and
(ii) the amount of any qualified stated interest payments allocable
to such accrual period. The "adjusted issue price" of a Discount
Note at the beginning of any accrual period is the sum of the issue
price of the Discount Note plus the amount of original issue
discount allocable to all prior accrual periods minus the amount of
any prior payments on the Discount Note that were not qualified
stated interest payments. Under these rules, holders will
generally have to include in income increasingly greater amounts of
original issue discount in successive accrual periods.
A U.S. Holder who purchases a Discount Note for an amount
that is greater than its adjusted issue price as of the purchase
date will be considered to have purchased the Discount Note at an
"acquisition premium." Under the acquisition premium rules, the
amount of original issue discount which such U.S. Holder must
include in its gross income with respect to such Discount Note for
any taxable year (or portion thereof in which the holder holds the
Discount Note) will be reduced (but not below zero) by the portion
of the acquisition premium properly allocable to the period.
Certain of the Notes (i) may be redeemable at the option
of the Company prior to their stated maturity (a "call option")
and/or (ii) may be repayable at the option of the holder prior to
their stated maturity (a "put option"). Notes containing such
features may be subject to rules that differ from the general rules
discussed above. Investors intending to purchase Notes with such
features should consult their tax advisors, since the original
issue discount consequences will depend, in part, on the particular
terms and features of such Notes.
Notes that have a fixed maturity of one year or less
("Short-Term Notes") will be deemed to have been issued with
original issue discount. In general, an individual or other cash
method U.S. Holder is not required to accrue original issue
discount on Short-Term Notes as income unless the holder elects to
do so. If such an election is not made, any gain recognized by the
U.S. Holder on the sale, exchange or maturity of the Short-Term
Note will be ordinary income to the extent of the original issue
discount accrued on a straight-line basis (or, upon election, a
constant yield method based on daily compounding) through the date
of sale or maturity, and a portion of the deductions otherwise
allowable to the holder for interest on borrowings allocable to the
Short-Term Note will be deferred until a corresponding amount of
income is realized. U.S. Holders who report income for federal
income tax purposes under the accrual method and certain other
holders, including banks and dealers in securities, are required to
accrue original issue discount on a Short-Term Note on a straight-
line basis unless an election is made to accrue the original issue
discount under a constant yield method (based on daily
compounding).
U.S. Holders may generally, upon election, include all
interest (including stated interest, original issue discount, de
minimis original issue discount, market discount, de minimis market
discount, and unstated interest, as adjusted by any amortizable
bond premium or acquisition premium) on a debt instrument by using
the constant yield method applicable to original issue discount,
subject to certain limitations and exceptions. This selection is
only available for debt instruments acquired on or after April 4,
1994.
Market Discount
If a U.S. Holder purchases a Note, other than a Discount
Note, for an amount that is less than its issue price (or, in the
case of a subsequent purchaser, its stated redemption price at
maturity) or purchases a Discount Note for an amount that is less
than its adjusted issue price as of the purchase date, the amount
of
S-14
<PAGE>
the difference will be treated as "market discount," unless such
difference is less than a specified de minimis amount.
Under the market discount rules, a U.S. Holder will be
required to treat any partial principal payment on a Note (or, in
the case of a Discount Note, any payment that does not constitute
qualified stated interest on the Discount Note) or any gain
realized on the sale, exchange, retirement or other disposition of
a Note as ordinary income to the extent of the lesser of (i) the
amount of such payment or realized gain or (ii) the market discount
which has not previously been included in income and is treated as
having accrued on such Note at the time of such payment or
disposition. Market discount will be considered to accrue ratably
during the period from the date of acquisition to the maturity date
of the Note, unless the U.S. Holder elects to accrue market
discount on the basis of semiannual compounding.
A U.S. Holder may be required to defer the deduction of
all or a portion of the interest paid or accrued on any
indebtedness incurred or maintained to purchase or carry a Note
with market discount until the maturity of the Note or its earlier
disposition in a taxable transaction. A U.S. Holder may elect to
include market discount in income currently as it accrues (on
either a ratable or semiannual compounding basis), in which case
the rules described above regarding the treatment as ordinary
income of gain upon the disposition of the Note and upon the
receipt of certain cash payments and regarding the deferral of
interest deductions will not apply. Generally, such currently
included market discount is treated as interest for federal income
tax purposes.
Premium
If a U.S. Holder purchases a Note for an amount that is
greater than its stated redemption price at maturity, such U.S.
Holder will be considered to have purchased the Note with
"amortizable bond premium" equal in amount to such excess. A U.S.
Holder may elect to amortize such premium using a constant yield
method over the remaining term of the Note and may offset interest
otherwise required to be included in respect of the Note during any
taxable year by the amortized amount for the taxable year.
However, if the Note may be optionally redeemed after the U.S.
Holder acquires it at a price in excess of its stated redemption
price at maturity, special rules would apply which could result in
a deferral of the amortization of some bond premium until later in
the term of the Note.
Disposition of a Note
Upon the sale, exchange or retirement of a Note, a U.S.
Holder generally will recognize taxable gain or loss equal to the
difference between the amount realized on the sale, exchange or
retirement and such U.S. Holder's adjusted tax basis in the Note.
A U.S. Holder's adjusted tax basis in a Note generally will equal
such U.S. Holder's initial investment of the Note increased by any
original issue discount included in income (and accrued market
discount, if any, if the holder has included such market discount
in income) and decreased by the amount of any payments, other than
qualified stated interest payments, received and premium
amortization deductions taken with respect to such Note. Except as
discussed above under "Original Issue Discount" and "Market
Discount," such gain or loss generally will be long-term capital
gain or loss if the Note has been held for more than one year.
NON-U.S. HOLDERS
Subject to the discussion of backup withholding below, a
non-U.S. Holder will generally not be subject to United States
federal income taxes or withholding on payments of principal,
premium (if any) or interest (including original issue discount, if
any) on a Note, unless such non-U.S. Holder is a direct or indirect
10% or greater shareholder of the Company, a controlled foreign
corporation related to the Company or a bank receiving interest
described in section 881(c)(3)(A) of the Internal Revenue Code of
1986, as amended ("Code"). To qualify for the exemption from
taxation, the last United States payor in the chain of payment
prior to payment to a non-U.S. Holder (the "Withholding Agent")
must have received in the year in which a payment of
S-15
<PAGE>
interest or principal occurs, or in either of the two preceding
calendar years, a statement that (i) is signed by the beneficial
owner of the Note under penalties of perjury, (ii) certifies that
such owner is not a U.S. Holder and (iii) provides the name and
address of the beneficial owner. The statement may be made on an
IRS Form W-8 or a substantially similar form, and the beneficial
owner must inform the Withholding Agent of any change in the
information on the statement within 30 days of such change. If a
Note is held through a securities clearing organization or certain
other financial institutions, the organization or institution may
provide a signed statement to the Withholding Agent. However, in
such case, the signed statement must be accompanied by a copy of
the IRS Form W-8 or the substitute form provided by the beneficial
owner to the organization or institution. The Treasury Department
is considering implementation of further certification requirements
aimed at determining whether the issuer of a debt obligation is
related to holders thereof.
Generally, a non-U.S. Holder will not be subject to
federal income taxes on any amount which constitutes capital gain
upon retirement or disposition of a Note. Certain exceptions to
this rule may be applicable, and a non-U.S. Holder should consult
its tax advisor in this regard.
The Notes will not be includible in the estate of a non-
U.S. Holder unless the individual is a direct or indirect 10% or
greater shareholder of the Company or, at the time of such
individual's death, payments in respect of the Notes would have
been effectively connected with the conduct by such individual of a
trade or business in the United States.
BACKUP WITHHOLDING
Backup withholding of federal income tax at a rate of 31%
may apply to payments made in respect of the Notes to registered
owners who are not "exempt recipients" and who fail to provide
certain identifying information (such as the registered owner's
taxpayer identification number) in the required manner. Generally,
individuals are not exempt recipients, whereas corporations and
certain other entities generally are exempt recipients. Payments
made in respect of the Notes to a U.S. Holder must be reported to
the IRS unless the U.S. Holder is an exempt recipient or otherwise
establishes an exemption. Compliance with the certification
procedures described under "Non-U.S. Holders" above would establish
an exemption from backup withholding for those non-U.S. Holders who
are not exempt recipients.
In addition, upon the sale of a Note to (or through) a
broker, the broker must withhold 31% of the entire purchase price,
unless either (i) the broker determines that the seller is a
corporation or other exempt recipient or (ii) the seller provides,
in the required manner, certain identifying information and, in the
case of a non-U.S. Holder, certifies that such seller is a non-U.S.
Holder (and certain other conditions are satisfied). Such a sale
must also be reported by the broker to the IRS unless either (i)
the broker determines that the seller is an exempt recipient or
(ii) the seller certifies its non-U.S. status (and certain other
conditions are satisfied). Certification of the registered owner's
non-U.S. status would be made normally on an IRS Form W-8 under
penalties of perjury, although in certain cases it may be possible
to submit other documentary evidence.
Any amounts withheld under the backup withholding rules
from a payment to a beneficial owner would be allowed as a refund
or a credit against such beneficial owner's United States federal
income tax, provided certain required information is furnished to
the IRS.
PLAN OF DISTRIBUTION
The Notes may be offered by the Company through Merrill
Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, CS
First Boston Corporation, Goldman, Sachs & Co., Lehman Brothers,
Lehman Brothers Inc., including its affiliate Lehman Special
Securities Inc., Morgan Stanley & Co. Incorporated or Salomon
Brothers Inc, as Agents, each of which has agreed to use its best
efforts to solicit offers to purchase the Notes. The Company will
pay each Agent a commission which, depending on the maturity of the
Note, will range from .125% to .625% of the principal amount of any
Note sold through such Agent. The Company also
S-16
<PAGE>
may sell Notes to any Agent at a discount for resale to purchasers
at varying prices related to prevailing market prices at the time
of resale, to be determined by such Agent, or, if so agreed, at
fixed public offering prices. The Company or an affiliate of the
Company may sell Notes directly to purchasers on behalf of the
Company in those jurisdictions where it is authorized to do so.
Unless otherwise indicated in the applicable Pricing
Supplement, payment of the purchase price of the Notes will be
required to be made in funds immediately available in The City of
New York. The Company reserves the right to withdraw, cancel or
modify the offer or solicitations of offers made hereby without
notice. The Company or any Agent, if it solicits such offer, may
reject any offer to purchase Notes, in whole or in part.
In addition, the Agents may offer the Notes they have
purchased as principal to other dealers. The Agents may sell Notes
to any dealer at a discount and, unless otherwise specified in the
applicable Pricing Supplement, such discount allowed to any dealer
will not be in excess of the discount to be received by such Agent
from the Company. Unless otherwise indicated in the applicable
Pricing Supplement, any Note sold to an Agent as principal will be
purchased by such Agent at a price equal to 100% of the principal
amount thereof less a percentage equal to the commission applicable
to any agency sale of a Note of identical maturity, and may be
resold by the Agent to investors and other purchasers from time to
time in one or more transactions, including negotiated
transactions, at varying prices determined at the time of sale or,
if so agreed, at a fixed public offering price. After the initial
public offering of Notes to be resold to investors and other
purchasers, the public offering price (if resold on a fixed public
offering price basis), concession and discount may be changed.
Each of the Agents may from time to time purchase and
sell Notes in the secondary market, but is not obligated to do so,
and there can be no assurance that there will be a secondary market
for the Notes or liquidity in the secondary market if one develops.
From time to time, each of the Agents may make a market in the
Notes. None of the Agents is obligated to do so, however, and any
Agent may discontinue making a market at any time without notice.
No assurance can be given as to the liquidity of any trading market
for the Notes.
Each Agent may be deemed to be an "Underwriter" within
the meaning of the Securities Act of 1933. The Company has agreed
to indemnify each Agent against certain liabilities, including
liabilities under such Act, or to contribute to payments the Agent
may be required to make in respect thereof. The Company has also
agreed to reimburse the Agents for certain expenses.
Each Agent may engage in transactions with and perform
services for the Company in the ordinary course of its business.
Warren E. Buffett, Chairman of the Executive Committee of
the Board of Directors of Salomon Inc., the parent of Salomon
Brothers Inc, one of the Agents, is the Chairman of the Board and
Chief Executive Officer of Berkshire Hathaway Inc. ("Berkshire").
Charles T. Munger, the Vice Chairman of Berkshire, is a member of
the Board of Directors of Salomon Inc. According to the most
recent information available to the Company at the date of this
Prospectus Supplement, Mr. Buffett, his wife, and a trust of which
Mr. Buffett is a trustee, but in which he has no economic interest,
own approximately 45% of the outstanding shares of Berkshire.
Berkshire and its subsidiaries own all of the outstanding shares of
Series A Cumulative Convertible Preferred Stock (the "Preferred
Stock") of Salomon Inc. The Preferred Stock is entitled to
18,421,053 votes, constituting approximately 14.3% of the votes
entitled to be cast by the outstanding voting securities of Salomon
Inc. The Preferred Stock is convertible into 18,421,053, or
approximately 14.3% of the outstanding shares of common stock of
Salomon Inc. According to the most recent information available to
the Company at the date of this Prospectus Supplement, Berkshire
and its subsidiaries also own 6,015,000 shares of common stock of
Salomon Inc, representing approximately 4.7% of the votes entitled
to be cast by the outstanding voting securities of Salomon Inc, so
that Berkshire's total voting percentage including both preferred
and common is approximately 19.0%. According to the most recent
information available to the Company at the date of this Prospectus
Supplement, Berkshire and its subsidiaries own 6,819,218 shares, or
approximately 12.2%, of the common stock
S-17
<PAGE>
of the Company. Berkshire has received approval from the Federal
Reserve Board to purchase up to 22% of the Company's common stock.
Berkshire has made passivity commitments to the Federal Reserve
Board which are designed to assure that Berkshire will not exercise
or attempt to exercise a controlling influence over the management
or policies of the Company or any of its subsidiaries. In
addition, Berkshire has granted an irrevocable proxy to the
Secretary of the Company to vote Berkshire's shares in accordance
with the recommendations of the board of directors of the Company.
Salomon Brothers Inc may from time to time own shares of common
stock of the Company. Neither Mr. Buffett nor any representative
of Berkshire is a director of the Company or any of its
subsidiaries.
S-18
<PAGE>
Company Logo - Stagecoach, Horses
Wells Fargo & Company
$1,500,000,000
WELLS FARGO & COMPANY
SENIOR DEBT SECURITIES
SUBORDINATED DEBT SECURITIES
PREFERRED STOCK
WELLS FARGO & COMPANY (the "Company") intends to offer
and sell from time to time its debt securities (the "Notes") and
its Preferred Stock, $5.00 par value ("Preferred Stock") with an
aggregate public offering price of $1,500,000,000 on terms to be
determined by market conditions at the time of sale. The Notes and
the Preferred Stock (together the "Offered Securities") may be
offered separately or together, in separate series, in amounts and
at prices and terms to be set forth in an accompanying Prospectus
Supplement ("Prospectus Supplement"). At the option of the
Company, the Notes may be issued as senior debt securities
("Senior Notes") or as subordinated debt securities
("Subordinated Notes"). The Offered Securities may be
denominated in United States dollars or, at the option of the
Company, in any other currency, in a composite currency or in
amounts determined by reference to an index which is specified in
the Prospectus Supplement. The specific terms of the Offered
Securities in respect of which this Prospectus is being delivered
will be set forth in an accompanying Prospectus Supplement. The
Notes may be convertible or exchangeable into Preferred Stock,
Common Stock or Capital Securities of the Company. The Preferred
Stock may be convertible or exchangeable into Notes, Common Stock
or Capital Securities of the Company.
The Offered Securities may be offered and sold directly
by the Company or selling securityholders, or through one or more
underwriters or agents. In addition, the Prospectus Supplement
will set forth the terms of sale of the Offered Securities and the
identity of any underwriters, agents or selling securityholders.
Any underwriters, dealers or agents participating in any offering
of the Offered Securities may be deemed "underwriters" within the
meaning of the Securities Act of 1933, as amended. See "Plan of
Distribution."
Payment of the principal of the Subordinated Notes may be
accelerated only in the case of certain events of bankruptcy,
insolvency or reorganization of the Company or the Bank. There is
no right of acceleration in the case of a default in the
performance of any covenant with respect to the Subordinated Notes,
including the payment of interest or principal. See "Description
of Notes--Events of Default."
__________________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
THE OFFERED SECURITIES ARE NOT DEPOSITS OR SAVINGS ACCOUNTS BUT ARE
UNSECURED DEBT OBLIGATIONS OF, OR EQUITY INTERESTS IN, WELLS FARGO
& COMPANY AND ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
__________________________
This Prospectus may not be used to consummate sales of Offered
Securities unless accompanied by a Prospectus Supplement.
__________________________
The date of this Prospectus is January 26, 1994
<PAGE>
No person has been authorized to give any information or to
make any representations other than those contained in this
Prospectus and the Prospectus Supplement in connection with the
offering made hereby, and if given or made, such information or
representations must not be relied upon as having been authorized
by the Company or by any underwriters or agents. Neither the
delivery of this Prospectus and the Prospectus Supplement nor any
sale made thereunder shall, under any circumstances, create any
implication that information herein is correct as of any time
subsequent to the date hereof.
AVAILABLE INFORMATION
The Company is subject to the informational requirements
of the Securities Exchange Act of 1934 ("Act") and in accordance
therewith files reports and other information with the Securities
and Exchange Commission ("Commission"). Proxy statements,
reports and other information concerning the Company can be
inspected at the Commission's office at 450 Fifth Street, N.W.,
Judiciary Plaza, Washington, D.C. 20549, and the Commission's
Regional Offices in New York (7 World Trade Center, Suite 1300, New
York, New York 10048) and Chicago (Northwest Atrium Center, 500
West Madison Street, Suite 1400, Chicago, Illinois 60661-2511), and
copies of such material can be obtained from such facilities and
the Public Reference Section of the Commission at 450 Fifth Street,
N.W., Judiciary Plaza, Washington, D.C. 20549, at prescribed rates.
In addition, such material can be inspected at the offices of the
New York and Pacific Stock Exchanges on which certain of the
Company's securities are listed. This Prospectus does not contain
all information set forth in the Registration Statement and
Exhibits thereto which the Company has filed with the Commission
under the Securities Act of 1933 and to which reference is hereby
made.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company hereby incorporates by reference in this
Prospectus the following reports filed with the Commission pursuant
to Section 13 of the Act: (i) the Company's Annual Report on Form
10-K for the year ended December 31, 1992; (ii) the Company's
Quarterly Reports on Form 10-Q for the quarters ended March 31,
June 30, and September 30, 1993; and (iii) the Company's Current
Reports on Form 8-K filed on January 21, April 21, July 21,
October 20, and October 21, 1993 and January 20, 1994. All
documents
filed by the Company pursuant to Section 13(a), 13(c), 14 or 15(d)
of the Act subsequent to the date of this Prospectus and prior to
the
termination of the offering of the Offered Securities offered
hereby
shall be deemed to be incorporated by reference into this
Prospectus
and to be a part hereof from the date of filing of such documents.
Any person receiving a copy of this Prospectus may obtain
without charge, upon oral or written request, a copy of any of the
documents incorporated by reference herein, except for the exhibits
to such documents unless such exhibits are specifically
incorporated by reference into the information that the Prospectus
incorporates. Requests should be directed to Wells Fargo &
Company, Investor/Public Relations, MAC #0163-029, 343 Sansome
Street, San Francisco, California 94163, telephone (415) 396-0560.
Any statement contained in a document incorporated or
deemed to be incorporated by reference herein shall be deemed to be
modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any other
subsequently filed document which also is deemed to be incorporated
by reference herein modifies or supersedes such statement. Any
such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this
Prospectus.
WELLS FARGO & COMPANY
Wells Fargo & Company ("Company") is a bank holding
company registered under the Bank Holding Company Act of 1956, as
amended. On the basis of assets as of September 30, 1993, the
Company was the twelfth largest bank holding company in the United
States. As of December 31, 1993, the Company had loans of $33.1
billion, total assets of $52.5 billion, total deposits of $41.6
billion and stockholders' equity of $4.3 billion. Its principal
subsidiary is Wells Fargo Bank, National Association ("Bank").
The Bank is primarily
2
<PAGE>
engaged in retail,
commercial and corporate banking, real estate lending and trust and
investment
services. In addition, one of its affiliates manages funds for
pension plans,
institutions and foundations.
The Company is a legal entity separate and distinct from
the Bank and its other affiliates. There are various legal
limitations on the extent to which the Bank may extend credit, pay
dividends or otherwise supply funds to the Company or various of
its affiliates. The executive offices of the Company are located
at 420 Montgomery Street, San Francisco, California 94163.
The Company's telephone number is (415) 477-1000.
Since the Company is a holding company, the rights of the
Company to participate in any distribution of assets of any
subsidiary upon its liquidation or reorganization or otherwise (and
thus the ability of holders of the Offered Securities to benefit
indirectly from such distribution) are subject to the prior claims
of creditors of that subsidiary, except to the extent that the
Company may itself be a creditor of that subsidiary. Claims on the
Company's subsidiaries by creditors other than the Company include
long-term debt and substantial obligations in respect of federal
funds purchased, securities sold under repurchase agreements and
certain other short-term borrowings, as well as deposit
liabilities.
USE OF PROCEEDS
The net proceeds from the sale of the Offered Securities
will be used for general corporate purposes. Specific allocations
of the proceeds to such purposes have not been determined. The net
proceeds may be used to reduce outstanding commercial paper and
other
debt of the Company. Based upon the anticipated future funding
requirements of the Company and its subsidiaries in addition to
those
stated above, the Company expects that it will, from time to time,
engage in additional financings of a character and in amounts to be
determined and that its commercial paper borrowings and other
short-term
debt may be increased above the level prevailing after the initial
use
of proceeds.
3
<PAGE>
SUMMARY FINANCIAL DATA
This summary is qualified in its entirety by the detailed
information and financial statements included in the documents
incorporated by reference in this Prospectus. See "Incorporation
of Certain Documents by Reference."
<TABLE>
<CAPTION>
Year Ended December 31,
(in millions)
1993 1992 1991 1990 1989
<S> <C> <C> <C> <C> <C>
Consolidated Summary
of Income:
Interest income $ 3,761 $ 4,145 $ 4,972 $ 5,051 $ 4,871
Interest expense 1,104 1,454 2,452 2,737 2,712
_______ _______ _______ _______ _______
Net interest income 2,657 2,691 2,520 2,314 2,159
Provision for loan losses 550 1,215 1,335 310 362
_______ _______ _______ _______ _______
Net interest income after
provision for loan losses 2,107 1,476 1,185 2,004 1,797
Noninterest income 1,093 1,059 889 909 779
Noninterest expense 2,162 2,035 2,020 1,717 1,575
_______ _______ _______ _______ _______
Income before income
tax expense 1,038 500 54 1,196 1,001
Income tax expense 426 217 33 484 400
_______ _______ _______ _______ _______
Net income $ 612 $ 283 $ 21 $ 712 $ 601
_______ _______ _______ _______ _______
_______ _______ _______ _______ _______
Net income applicable
to common stock $ 562 $ 235 $ 2 $ 685 $ 574
_______ _______ _______ _______ _______
_______ _______ _______ _______ _______
Net income per common
share $ 10.10 $ 4.44 $ .04 $ 13.39 $ 11.02
_______ _______ _______ _______ _______
_______ _______ _______ _______ _______
Average common shares
outstanding 56 53 52 51 52
_______ _______ _______ _______ _______
_______ _______ _______ _______ _______
Consolidated Average
Balance Sheet Data:
Loans $34,304 $40,406 $46,736 $44,061 $39,426
Total assets 51,110 52,497 55,022 51,109 47,763
Core deposits 40,389 41,779 41,523 36,219 32,850
Total deposits 40,727 42,266 42,642 37,075 34,099
Stockholders' equity 3,996 3,573 3,352 3,137 2,747
Net Interest Margin(1) 5.74% 5.70% 5.18% 5.12% 5.11%
Consolidated
Profitability Ratios:
Net income to average
total assets (ROA) 1.20% .54% .04% 1.39% 1.26%
Net income applicable
to common stock to
average common
stockholders'
equity (ROE) 16.74 7.93 .07 25.07 24.49
<FN>
______________
(1) Net interest margin is defined as net interest income on a taxable-equivalent basis divided by average
total earning assets.
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
Year Ended December 31,
(in millions)
1993 1992 1991 1990 1989
<S> <C> <C> <C> <C> <C>
Consolidated Period-End
Capital Ratios:(2)
Common stockholders'
equity to assets 7.00% 6.03% 5.24% 5.26% 5.04%
Stockholders' equity
to assets 8.22% 7.25% 6.11% 5.98% 5.87%
Consolidated
Period-End Loan Data:
Allowance for loan
losses $ 2,122 $ 2,067 $ 1,646 $ 885 $ 738
Allowance for loan
losses as a percentage
of total loans 6.41% 5.60% 3.73% 1.81% 1.77%
Nonaccrual and
restructured loans $ 1,200 $ 2,142 $ 1,981 $ 1,013 $ 764
Nonaccrual and
restructured loans as
a percentage of total
loans 3.6% 5.8% 4.5% 2.1% 1.8%
Consolidated Loan
Charge-Off Data:
Net loan charge-offs $ 495 $ 798 $ 572 $ 168 $ 267
Net loan charge-offs
as a percentage of
average total loans 1.44% 1.97% 1.22% .38% .67%
Consolidated Ratios of
Earnings to Fixed
Charges: (3)(5)
Including interest
on deposits 1.90 1.33 1.02 1.43 1.36
Excluding interest
on deposits 4.53 2.56 1.10 2.42 2.05
Consolidated Ratios
of Earnings to Fixed
Charges and Preferred
Stock Dividends:(3)
(4)(5)
Including interest
on deposits 1.77 1.26 1.00 1.41 1.34
Excluding interest
on deposits 3.51 2.02 1.01 2.30 1.96
<FN>
________________________
(2) In January 1991, the Company redeemed all $180 million of its
Market Auction Preferred Stock ("MAPS"). Excluding the MAPS, the
1990 year-end stockholders' equity to assets ratio would have been
5.66%. Based on the Federal Reserve Board's 1992 guidelines, the
Company's total risk-based capital ratio at December 31, 1993 was
15.08% (preliminary) and its Tier 1 risk-based capital ratio was
10.44% (preliminary); the ratios at December 31, 1992 were 13.15%
and 8.22%, respectively; the ratios at December 31, 1991 were
10.19% and 5.78%, respectively; the ratios at December 31, 1990
were 9.27% and 5.03%, respectively, after excluding the $180
million of preferred stock redeemed in January 1991; the ratios at
December 31, 1989 were 9.91% and 4.95%, respectively.
(3) For purposes of computing these ratios, earnings represent
income before income tax expense plus fixed charges. Fixed charges
represent interest expense plus the estimated interest component of
net rental expense.
(4) The preferred stock dividends are increased to amounts
representing the pretax earnings required to cover such dividends.
(5) These computations are included herein in compliance with
Securities and Exchange Commission regulations. However,
management believes that fixed charge ratios are not meaningful
measures for the business of the Company because of two factors.
First, even if there were no change in net income, the ratios would
decline with an increase in the proportion of income which is
tax-exempt or, conversely, they would increase with a decrease in
the proportion of income which is tax-exempt. Second, even if
there were no change in net income, the ratios would decline if
interest income and interest expense increase by the same amount
due to an increase in the level of interest rates or, conversely,
they would increase if interest income and interest expense
decrease by the same amount due to a decrease in the level of
interest rates.
</TABLE>
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DESCRIPTION OF NOTES
The Senior Notes will be issued under an Indenture, dated
as of September 1, 1984, as amended by the First Supplemental
Indenture dated as of April 15, 1986, the Second Supplemental
Indenture dated as of June 30, 1987, and the Third Supplemental
Indenture dated as of January 23, 1991 (together, the "Senior
Indenture"), between the Company and Chemical Bank, as successor
Trustee (the "Senior Trustee"). The Subordinated Notes will be
issued under an Indenture dated as of December 10, 1992 (the
"Subordinated Indenture"), between the Company and Marine Midland
Bank, N.A., as Trustee (the "Subordinated Trustee"). In this
Prospectus, the Senior Indenture and the Subordinated Indenture are
referred to as the "Indentures." The Senior Trustee and the
Subordinated Trustee are referred to as the "Trustees." Copies
of the Indentures are filed or incorporated by reference as
exhibits to the Registration Statement. The following summaries of
certain provisions of the Indentures do not purport to be complete
and are subject to, and are qualified in their entirety by
reference to, all the provisions of the Indentures, including the
definitions therein of certain terms. Whenever particular
Sections,
Articles or defined terms of the Indentures are referred to, it is
intended that such Sections, Articles or defined terms shall be
incorporated herein by reference.
General
The Indentures do not limit the amount of Notes which can
be issued thereunder and provide that Notes of any series may be
issued thereunder up to the aggregate principal amount which may be
authorized from time to time by the Company. The Indentures do not
limit the amount of other indebtedness or securities which may be
issued by the Company. The Notes may be issued at various times
with different maturity dates and different principal repayment
provisions, may bear interest at different rates, may be payable in
currencies other than United States dollars, in composite
currencies or in amounts determined by reference to an index and
may otherwise vary, all as provided in the Indentures.
The Prospectus Supplement will set forth the following
specific terms regarding the series of Notes offered thereby: (i)
the designation and aggregate principal amount of Notes of such
series; (ii) the ranking of the Notes as Senior Notes or
Subordinated Notes; (iii) the percentage of their principal amount
at which such Notes will be issued; (iv) the date or dates on which
such Notes will mature, if any; (v) the rate per annum or the
method of determining the rate or rates per annum, if any, at which
such Notes will bear interest; (vi) the dates from and on which
such interest, if any, will accrue and be payable and the
designated record dates for such interest payments; (vii) the
currency (which may be a composite currency) in which payment of
principal and interest, if any, shall be payable if other than
United States dollars; (viii) the index, if any, upon which the
amount of principal or interest is determined; (ix) any redemption
terms; (x) any conversion or exchange provisions; (xi) provisions
for issuance of global securities; and (xii) other specific terms.
Some of the Notes may be issued as discounted Notes
(bearing no interest or interest at a rate which at the time of
issuance is below market rates) to be sold at a discount below
their stated principal amount. Some of the Notes may be perpetual
and have no stated maturity. Federal income tax consequences and
other special considerations applicable to such perpetual or
discounted Notes will be described in the Prospectus Supplement
relating thereto.
Interest on the Notes of any series will be payable to
the persons in whose names the Notes are registered at the close of
business on the record date designated for an interest payment date
(Section 2.03). The Notes may be presented for the payment of
principal and interest, if any, transfer and exchange at the
offices or agencies of the Company maintained for such purposes in
San Francisco and New York City. Payment of any installment of
interest may be made at the option of the Company by check, mailed
to the address of the person entitled thereto as it appears on the
Register of the Notes of such series (Sections 2.05, 4.01 and
4.02). The Notes will be issued in fully registered form in
denominations of $1,000 and any whole multiple of $1,000, unless
different authorized denominations are stated in the Prospectus
Supplement. No service charge will be made for any exchange or
registration of transfer of a Note, but the Company may require
payment of a sum
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<PAGE>
sufficient to cover any tax or other governmental
charge (Section 2.05). The Indentures provide that if a series of
Notes is denominated in a currency other than United States dollars
or in a composite currency, in the absence of a contrary provision
in the Notes any action or distribution under the Indentures will
be based on the relative amount of United States dollars that could
be obtained on such reasonable basis of exchange on such date as is
specified by the Company to the Trustee (Sections 14.10 of the
Senior Indenture and 16.10 of the Subordinated Indenture).
All of the Notes will be unsecured general obligations of
the Company. The Senior Notes will not be subordinated in right of
payment to any other indebtedness of the Company. Unless otherwise
set forth in the applicable Prospectus Supplement, neither the
Indentures nor the Notes contain provisions which would afford
holders of the Notes protection in the event of a takeover,
recapitalization or similar restructuring involving the Company
which could adversely affect the Notes.
Subordination of Subordinated Notes
The obligation of the Company to make any payment on
account of the principal of and interest on the Subordinated Notes
of any series will be subordinate and junior in right of payment to
the Company's obligations to the holders of Senior Indebtedness of
the Company to the extent described in the next paragraph. Senior
Indebtedness of the Company includes the Senior Notes and means (i)
any indebtedness of the Company for borrowed or purchased money,
whether or not evidenced by bonds, debentures, notes or other
written instruments, (ii) obligations under letters of credit,
(iii) any indebtedness or other obligations of the Company with
respect to commodity contracts, interest rate and currency swap
agreements, cap, floor and collar agreements, currency spot and
forward contracts, and other similar agreements or arrangements
designed to protect against fluctuations in currency exchange or
interest rates, and (iv) any guarantees, endorsements (other than
by endorsement of negotiable instruments for collection in the
ordinary course of business) or other similar contingent
obligations in respect of obligations of others of a type described
in (i), (ii) or (iii) above, whether or not such obligation is
classified as a liability on a balance sheet prepared in accordance
with generally accepted accounting principles, in each case listed
in (i), (ii), (iii) and (iv) above, whether outstanding on the date
of execution of the Indenture or thereafter incurred, other than
obligations "ranking on a parity" with the Securities or "ranking
junior" to the Securities (as those terms are defined in the
Subordinated Indenture) (Section 1.01). The definition of senior
indebtedness in previously issued subordinated debt of the Company
includes only indebtedness of or guaranteed by the Company for
borrowed money and any deferred obligation for the payment of the
purchase price of property or assets, other than obligations
ranking on a parity with or junior to such subordinated
indebtedness. As a result of this difference, the holders of
Subordinated Notes are subordinated to greater amounts of senior
indebtedness of the Company than holders of such previously issued
subordinated indebtedness of the Company. As of September 30,
1993, there were $2.2 billion of Senior Indebtedness of the Company
and $1.9 billion of obligations ranking on a parity with the
Subordinated Notes. The Subordinated Indenture does not limit the
amount of Senior Indebtedness of the Company.
In the case of any insolvency, receivership,
conservatorship, reorganization, readjustment of debt, marshalling
of assets and liabilities or similar proceedings or any liquidation
or winding-up of or relating to the Company as a whole, whether
voluntary or involuntary, all obligations of the Company to holders
of Senior Indebtedness of the Company shall be entitled to be paid
in full before any payment shall be made on account of the
principal of or interest on the Subordinated Notes. In the event
of any such proceeding, after payment in full of all sums owing
with respect to Senior Indebtedness of the Company, the holders of
the Subordinated Notes, together with the holders of any
obligations of the Company ranking on a parity with the
Subordinated Notes, shall be entitled to be paid from the remaining
assets of the Company the amounts at the time due and owing on
account of unpaid principal of and interest on the Subordinated
Notes before any payment or other distribution, whether in cash,
property or otherwise, shall be made on account of any capital
stock or any obligations of the Company ranking junior to the
Subordinated Notes (Section 14.01). By reason of such
subordination, in the event of the insolvency of the Company,
holders of Senior Indebtedness of the Company may receive more,
ratably, and holders of the Subordinated Notes having a claim
pursuant to the Subordinated
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<PAGE>
Notes may receive less, ratably, than
the other creditors of the Company. Such subordination will not
prevent the occurrence of any Event of Default in respect of the
Subordinated Notes (Section 14.10).
Global Securities
The Notes of a series may be issued in whole or in part
in the form of one or more global securities ("Global Security")
that will be deposited with, or on behalf of, a depositary
identified in the Prospectus Supplement relating to such series.
Global Securities will be issued in registered form and in either
temporary or definitive form. Unless and until it is exchanged in
whole or in part for Notes in definitive form, a Global Security
may not be transferred except as a whole by the depositary for such
Global Security to a nominee of such depositary or by a nominee of
such depositary to such depositary or another nominee of such
depositary or by such depositary or any such nominee to a successor
of such depositary or a nominee of such successor (Sections 2.02
and 2.05).
The specific terms of the depositary arrangement with
respect to any Notes of a series will be described in the
Prospectus Supplement relating to such series. The Company
anticipates that the following provisions will apply to all
depositary arrangements.
Upon the issuance of a Global Security, the depositary
for such Global Security will credit, on its book-entry
registration and transfer system, the respective principal amounts
of the Notes represented by such Global Security to the accounts of
institutions that have accounts with such depositary
("Participants"). The accounts to be credited shall be
designated by the underwriters of such Notes, by certain agents of
the Company or by the Company, if such Notes are offered and sold
directly by the Company. Ownership of beneficial interests in a
Global Security will be limited to Participants or persons that may
hold interests through Participants. Ownership of beneficial
interests in such Global Security will be shown on, and the
transfer of that ownership will be effected only through, records
maintained by the depositary with respect to Participants'
interests in such Global Security or by Participants or by persons
that hold through Participants with respect to beneficial owners'
interests. The laws of some states require that certain purchasers
of securities take physical delivery of such securities in
definitive form. Such ownership limits and such laws may impair
the ability to transfer beneficial interests in a Global Security.
So long as the depositary for a Global Security, or its
nominee, is the holder of such Global Security, such depositary or
such nominee, as the case may be, will be considered the sole owner
or holder of the Notes represented by such Global Security for all
purposes under the Indenture governing such Notes. Except as set
forth below, owners of beneficial interests in a Global Security
will not be entitled to have Notes of the series represented by
such Global Security registered in their names, will not receive or
be entitled to receive physical delivery of Notes of such series in
definitive form and will not be considered the owners or holders
thereof under the Indenture governing such Notes.
Principal and interest payments on Notes registered in
the name of or held by a depositary or its nominee will be made to
the depositary or its nominee, as the case may be, as the
registered owner of the Global Security representing such Notes.
The Company expects that the depositary for Notes of a series, upon
receipt of any payment of principal or interest in respect of a
Global Security, will immediately credit Participants' accounts
with payments in amounts proportionate to their respective
beneficial interests in the principal amount of such Global
Security as shown on the records of such depositary. The Company
also expects that payments by Participants to owners of beneficial
interests in such Global Security held through such Participants
will be governed by standing instructions and customary practices,
as is now the case with securities held for the accounts of
customers in bearer form or registered in "street name," and will
be the responsibility of such Participants. None of the Company,
the Trustee for such Notes, any paying agent or any registrar for
such Notes will have any responsibility or liability for any aspect
of the records relating to or payments made on account of
beneficial ownership interests in a Global Security for such Notes
or for maintaining, supervising or reviewing any records relating
to such beneficial ownership interests.
8
<PAGE>
If a depositary for Notes of a series is at any time
unwilling or unable to continue as depositary and a successor
depositary is not appointed by the Company within 90 days, the
Company will issue Notes of such series in definitive form in
exchange for the Global Security or Securities representing the
Notes of such series. In addition, the Company may at any time and
in its sole discretion determine not to have any Notes of a series
represented by one or more Global Securities and, in such event,
will issue Notes of such series in definitive form in exchange for
the Global Security or Securities representing such Notes.
Conversion and Exchange
The terms, if any, on which Notes of any series are
convertible into or exchangeable for Common Stock, Preferred Stock
or Capital Securities will be set forth in the Prospectus
Supplement relating thereto. Such terms may include provisions for
conversion or exchange, either mandatory, at the option of the
holder, or at the option of the Company, in which the number of
shares of Common Stock, Preferred Stock or Capital Securities
to be received by the holders of Notes would be calculated
according to the market price of Common Stock, Preferred Stock
or Capital Securities as of a time stated in the Prospectus
Supplement.
Limitation on Sale or Issuance of Capital Stock or Convertible
Securities of, and Merger or Sale of Assets by, the Bank
The Senior Indenture contains a covenant that (i) the
Company will not, and will not permit Wells Fargo Bank, National
Association (or its successors or survivors) ("Bank") to issue,
sell, transfer, assign, pledge or otherwise dispose of any shares
of Capital Stock of any class of the Bank or any securities
convertible or exchangeable into shares of Capital Stock of any
class of the Bank, unless, after giving effect to such transaction
and to shares issuable upon conversion or exchange of outstanding
securities convertible or exchangeable into such Capital Stock
(including such securities, if any, which may be the subject of
such transaction), at least 80% of the outstanding shares of
Capital Stock of each class of the Bank shall be owned at that time
directly or indirectly by the Company; and (ii) the Company will
not permit the Bank to merge or consolidate or convey or transfer
all or substantially all of its assets, unless at least 80% of the
outstanding shares of Capital Stock of each class (after giving
effect to such transaction and to shares issuable upon conversion
or exchange of outstanding securities convertible or exchangeable
into Capital Stock, including such securities, if any, which may be
issued in such transaction) of the surviving corporation in the
case of merger or consolidation or of the transferee corporation in
the case of a conveyance or transfer shall be owned at that time
directly or indirectly by the Company (Section 4.07 of the Senior
Indenture). There is no similar covenant in the Subordinated
Indenture.
Events of Default
An Event of Default with respect to any series of Senior
Notes is defined in the Senior Indenture as being: (a) default for
30 days in payment of any installment of interest on Senior Notes
of such series; (b) default in payment of any principal on Senior
Notes of such series; (c) default by the Company in performance in
any material respect of any of the covenants or agreements in the
Senior Notes or in the Senior Indenture specifically contained
therein for the benefit of the Senior Notes of such series which
shall not have been remedied for a period of 90 days after written
notice to the Company by the Trustee or to the Company and the
Trustee by the holders of not less than 25% in principal amount of
the Senior Notes of such series and all other series so benefited
(all such series voting as one class) then outstanding; or (d)
certain events of bankruptcy, insolvency or reorganization of the
Company or of the Bank (Section 6.01 of the Senior Indenture). No
Event of Default described in clause (a), (b) or (c) above with
respect to a particular series of Senior Notes necessarily
constitutes an Event of Default with respect to any other series of
Senior Notes. In addition, the Senior Indenture defines an Event
of Default as being default in the payment of any indebtedness for
borrowed money of the Company (including a default with respect to
Senior Notes of any series other than such series) or of the Bank
in principal amount in excess of $1,000,000 and the expiration of
any period of grace, or the occurrence of any event of default
under any mortgage, indenture or instrument (including the
Indentures)
9
<PAGE>
evidencing, securing or under which there is issued any
indebtedness for borrowed money of the Company or of the Bank in
principal amount in excess of $1,000,000 that results in the
acceleration of such indebtedness, and such default in payment is
not cured or such acceleration is not rescinded or annulled within
10 days after written notice to the Company by the Trustee or to
the Company and the Trustee by the holders of not less than 25% in
principal amount of the Senior Notes then outstanding (all series
voting as one class), provided that so long as the Company or the
Bank, as the case may be, is contesting in good faith such default
in payment or event of default and the Company delivers to the
Trustee a certificate that the Company or the Bank, as the case may
be, is contesting in good faith the existence of such payment
default or event of default, then no Event of Default shall be
deemed to exist under this clause; such Event of Default is herein
called a "Cross Default."
The Senior Indenture provides that if an Event of Default
under clause (a), (b) or (c) above shall have occurred and be
continuing (but only if, in the case of clause (c), the Event of
Default is with respect to less than all series of Senior Notes
then outstanding under such Indenture), either the Trustee or the
holders of not less than 25% in principal amount of the then
outstanding Senior Notes of the series as to which the Event of
Default has occurred (each such series voting as a separate class
in the case of an Event of Default under clause (a) or (b), and all
such series voting as one class in the case of an Event of Default
under clause (c)) may declare the principal (or portion thereof
specified in the terms of such series) of all the Senior Notes of
such series, together with any accrued interest, to be due and
payable immediately. The Senior Indenture also provides that if an
Event of Default under clause (c) or (d) above or the Cross Default
clause shall have occurred and be continuing (but only if, in the
case of clause (c), the Event of Default is with respect to all the
Senior Notes then outstanding under the Senior Indenture), either
the Trustee or the holders of not less than 25% in principal amount
of all the Senior Notes then outstanding (voting as one class) may
declare the principal (or portion thereof specified in the terms of
any series) of all the Senior Notes, together with any accrued
interest, to be due and payable immediately. Upon certain
conditions, such declaration (including a declaration caused by a
default in the payment of principal or interest, the payment for
which has subsequently been provided) may be annulled by the
holders of a majority in principal amount of the Senior Notes of
the series then outstanding (voting as one class) as were entitled
to declare such default. In addition, past defaults may be waived
by the holders of a majority in principal amount of the Senior
Notes of all series then outstanding (all series voting as one
class), except a default in the payment of principal of or interest
on the Senior Notes or in respect of a covenant or provision of the
Senior Indenture which cannot be modified or amended without the
consent of the holder of each Senior Note so affected (Sections
6.01 and 6.06 of the Senior Indenture).
An Event of Default with respect to any series of
Subordinated Notes is defined in the Subordinated Indenture as
being: (a) default for 30 days in payment of any installment of
interest on Subordinated Notes of such series; (b) default in
payment of any principal on Subordinated Notes of such series; (c)
default by the Company in performance in any material respect of
any of the covenants or agreements in the Subordinated Notes or in
the Subordinated Indenture specifically contained therein for the
benefit of the Subordinated Notes of such series which shall not
have been remedied for a period of 90 days after written notice to
the Company by the Trustee or to the Company and the Trustee by the
holders of not less than 25% in principal amount of the
Subordinated Notes of such series and all other series so benefited
(all such series voting as one class) then outstanding; or (d)
certain events of bankruptcy, insolvency or reorganization of the
Company or the Bank (Section 6.01 of the Subordinated Indenture).
No Event of Default described in clause (a), (b) or (c) above with
respect to a particular series of Subordinated Notes necessarily
constitutes an Event of Default with respect to any other series of
Subordinated Notes.
No Event of Default described in clause (a), (b) or (c) above
permits acceleration of the payment of principal of the
Subordinated Notes. The Subordinated Indenture provides that if an
Event of Default under clause (d) above shall have occurred and be
continuing, either the Trustee or the holders of not less than 25%
in principal amount of all the then outstanding Subordinated Notes
of each series (voting as one class) may declare the principal (or
a portion thereof specified in the terms of any series) of the
Subordinated Notes of all such series, together with any accrued
interest, to be due and payable immediately unless the terms of a
series of Notes provide otherwise. Upon certain conditions, such
declaration may be annulled by a majority in principal amount of
the Subordinated Notes of the series then outstanding as were
entitled to declare such Event of Default (voting as one class).
In addition, past
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<PAGE>
defaults in respect of such Subordinated Notes may be waived by the
holders of a majority in principal amount of the Subordinated
Notes of all series then outstanding as to which the default has
occurred (all series voting as one class), except a default in the
payment of principal or interest on any such Subordinated Notes of
such series or in respect of a covenant or provision of the
Subordinated Indenture which cannot be modified or amended without
the consent of the holder of each Subordinated Note so affected
(Sections 6.01 and 6.06 of the Subordinated Indenture).
As a result of the provisions stated in the prior
paragraph, the Subordinated Indenture does not provide for any
right to accelerate the payment of principal of the Subordinated
Notes upon a default in payment of principal or interest or in the
performance of any covenant or agreement in the Subordinated Notes
or the Subordinated Indenture. In the case of a default in the
payment of principal or interest, the Trustee, subject to certain
limitations and conditions, may institute judicial proceedings to
enforce payment of such principal or interest (Section 6.02 of the
Subordinated Indenture).
Each Indenture contains a provision entitling the
Trustee, subject to the duty of the Trustee during default to act
with the required standard of care, to be indemnified by the
holders of Notes issued under such Indenture before proceeding to
exercise any right or power under the Indenture at the request of
such Noteholders (Section 7.02). Each Indenture also provides that
the holders of a majority in principal amount of the outstanding
Notes of all series affected (voting as one class) may direct the
time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power
conferred on the Trustee, with respect to the Notes of such series
(Section 6.06).
Each Indenture contains a covenant that the Company will
file annually with the Trustee a certificate as to the absence of
any default or specifying any default that exists (Section 4.06).
Modification of the Indenture and Waiver
Each Indenture contains provisions permitting the Company
and the Trustee, with the consent of the holders of not less than
66-2/3% in principal amount of the Notes of all series then
outstanding under such Indenture affected by such supplemental
indenture (voting as one class), to execute supplemental indentures
adding any provisions to or changing or eliminating any of the
provisions of such Indenture or modifying the rights of the holders
of Notes of each such series, except that no such supplemental
indenture may (i) extend the fixed maturity of any Notes, or reduce
the rate or extend the time of payment of any interest thereon or
on any overdue principal amount, or reduce the principal amount
thereof, or reduce any amount payable upon any redemption thereof,
or change the currency of payment of principal of or any interest
thereon or on any overdue principal amount, without the consent of
the holder of each Note so affected, or (ii) reduce the aforesaid
percentage of Notes, the holders of which are required to consent
to any such supplemental indenture, without the consent of the
holders of all outstanding Notes (Section 10.02).
Each Indenture provides that the Company may omit in any
particular instance to comply with any covenant or condition
specifically contained in such Indenture for the benefit of one or
more series of Notes (including in the case of the Senior
Indenture, the covenant described above under "Limitation on Sale
or Issuance of Capital Stock or Convertible Securities of, and
Merger or Sale of Assets by, the Bank") if before the time for
such compliance the holders of a majority in principal amount of
the Notes of all series then outstanding under such Indenture, and,
in the case of the Subordinated Indenture, affected by the omission
(voting as one class) waive such compliance in such instance, but
such waiver shall not extend to or affect such covenant or
condition except to the extent so expressly waived (Section 4.08 of
the Senior Indenture and Section 4.07 of the Subordinated
Indenture).
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<PAGE>
Consolidation, Merger and Sale of Assets
Each Indenture provides that the Company may not merge or
consolidate or sell or convey all or substantially all of its
assets unless the successor corporation (if other than the Company)
is a domestic corporation, assumes the Company's obligations under
such Indenture and on the Notes issued under such Indenture, and,
after giving effect to such transaction, the Company or the
successor corporation would not be in default under such Indenture
(Section 11.01).
Concerning the Trustees
Chemical Bank is the successor Trustee under the Senior
Indenture. Notices to the Senior Trustee should be directed to
Chemical Bank, Corporate Trust Department, 450 West 33rd Street,
New York, New York 10001, Attention: Vice President. The Company
and the Bank maintain deposit accounts and conduct other banking
transactions with the Senior Trustee in the ordinary course of
business. Marine Midland Bank, N.A. is the Trustee under the
Subordinated Indenture. Notices to the Subordinated Trustee should
be directed to Marine Midland Bank, N.A., 140 Broadway, New York,
New York 10015, Attention: Vice President--Corporate Trust
Administration. The Bank has entered into correspondent banking
relationships with the Subordinated Trustee and with its corporate
parent, The Hong Kong and Shanghai Banking Corporation Limited
("HSBC"), involving various banking transactions in the ordinary
course of business. As part of their relationship, the Bank and
HSBC have an arrangement providing for the referral of customers to
each other.
DESCRIPTION OF PREFERRED STOCK
The following description of Preferred Stock sets forth
certain general terms and provisions of the series of Preferred
Stock to which any Prospectus Supplement may relate. The specific
terms of a particular series of Preferred Stock will be described
in the Prospectus Supplement relating to such series of Preferred
Stock. If so indicated in the Prospectus Supplement relating
thereto, the terms of any such series of Preferred Stock may
differ from the terms set forth below. The description of
Preferred Stock set forth below and the description of the terms of
a particular series of Preferred Stock set forth in the Prospectus
Supplement relating thereto do not purport to be complete and are
qualified in their entirety by reference to the Company's Restated
Certificate of Incorporation, as amended (the "Certificate of
Incorporation"), and the Certificate of Designation relating to
such series of Preferred Stock, which are filed or incorporated by
reference as an exhibit to the Registration Statement of which this
Prospectus is a part.
General
The Company is authorized to issue 25,000,000 shares of
Preferred Stock. The Board of Directors has the authority to issue
Preferred Stock in one or more series and to fix the specific
number of shares, title, liquidation preference of each share,
issue price, dividend rate or rates (or method of calculation),
dividend periods, dividend payment dates, any redemption or sinking
fund provisions, any conversion provisions and any other specific
terms of any series without any further action by stockholders of
the Company unless action is required by applicable laws or
regulations or by the terms of other outstanding preferred stock.
As of the date of this Prospectus, the Company had four series of
Preferred Stock outstanding consisting of 3,000,000 shares of
Adjustable Rate Cumulative Preferred Stock, Series A, 1,500,000
shares of Adjustable Rate Cumulative Preferred Stock, Series B
(together, "Adjustable Rate Preferred Stock"), 477,500 shares of
9% Preferred Stock, Series C ("9% Preferred Stock") represented
by 9,550,000 Depositary Shares each representing a one-twentieth
interest in a share of 9% Preferred Stock and 350,000 shares of
8-7/8% Preferred Stock, Series D (the "8-7/8% Preferred Stock"
and together with the 9% Preferred Stock, the "Fixed Rate
Preferred Stock") represented by 7,000,000 Depositary Shares each
representing a one-twentieth interest in a share of 8-7/8%
Preferred Stock. The Adjustable Rate Preferred Stock has a
liquidation preference of $50 per share and the Fixed Rate
Preferred Stock has a liquidation preference of $500 per share or
$25 per Depositary Share. See "Description of Capital Stock--
Existing Preferred Stock." Unless otherwise specified in the
Prospectus Supplement relating thereto,
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the shares of each series of Preferred Stock will rank on a
parity as to dividends and distributions of assets with
each other and with the Adjustable Rate Preferred Stock
and the Fixed Rate Preferred Stock.
The Prospectus Supplement will set forth the following
specific terms regarding the series of Preferred Stock offered
thereby: (i) the designation, number of shares and liquidation
preference per share; (ii) the initial public offering price; (iii)
the dividend rate or rates, or the method of determining the
dividend rate or rates; (iv) the index, if any, upon which the
amount of dividends, if any, is determined; (v) the dates on which
dividends, if any, will accrue and be payable and the designated
record dates for determining the holders entitled to such
dividends; (vi) any redemption or sinking fund provisions; (vii)
any conversion or exchange provisions; (viii) whether the Company
has elected to offer Depositary Shares as described under
"Description of Depositary Shares"; (ix) provisions for issuance
of global securities; (x) the currency (which may be composite
currency) in which payment of dividends, if any, shall be payable
if other than United States dollars; (xi) voting rights, if
different from those described under "Description of Preferred
Stock--Voting Rights"; and (xii) any additional terms,
preferences or rights.
As described under "Description of Depositary Shares,"
the Company may, at its option, elect to offer depositary shares
("Depositary Shares") evidenced by depositary receipts ("Depositary
Receipts"), each representing a fractional interest (to be
specified
in the Prospectus Supplement relating to the particular series of
the Preferred Stock) in a share of the particular series of the
Preferred Stock issued and deposited with a Depositary (as defined
below).
Under regulations adopted by the Board of Governors of
the Federal Reserve System (the "Federal Reserve Board"), if the
holders of shares of any series of preferred stock of the Company
become entitled to vote for the election of directors because the
Board of Directors of the Company has failed to declare or pay
dividends on such series (see "Description of Preferred Stock--
Voting Rights"), such series may then be deemed a class of
"voting securities" and a holder of 25 percent or more of such
series (or a holder of five percent or more if it otherwise
exercises a "controlling influence" over the Company) may then be
subject to regulation as a bank holding company in accordance with
the Bank Holding Company Act of 1956, as amended. In addition, at
such time as such series is deemed a class of voting securities,
any other bank holding company may be required to obtain the prior
approval of the Federal Reserve Board to acquire five percent or
more of such series and any person other than a bank holding
company may be required to obtain the prior approval of the Federal
Reserve Board to acquire ten percent or more of such series.
The shares of Preferred Stock will, when issued, be fully
paid and nonassessable and will have no preemptive rights.
The transfer agent, registrar, dividend disbursing agent
and redemption agent for the Preferred Stock will be specified in
the Prospectus Supplement relating thereto.
Dividends
The holders of the Preferred Stock of each series will be
entitled to receive, when, as and if declared by the Board of
Directors of the Company, out of funds legally available therefor,
cumulative or non-cumulative cash or other dividends at such rate
or rates and on such dates as will be set forth in the Prospectus
Supplement relating to such series. Such rates may be fixed or
variable or both. If variable, the formula used for determining
the dividend rate for each dividend period will be set forth in the
Prospectus Supplement. Dividends will be payable to the holders of
record as they appear on the stock books of the Company on such
record dates as will be fixed by the Board of Directors of the
Company and specified in the Prospectus Supplement. If the Board
of Directors of the Company fails to declare a dividend payable on
a dividend payment date on any series of the Preferred Stock for
which dividends are noncumulative ("Noncumulative Preferred
Stock"), then the holders of such series of the Preferred Stock
will have no right to receive a dividend in respect of the dividend
period ending on such dividend payment date, and the Company will
have no
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obligation to pay a dividend for such period, whether or
not dividends on such series are declared payable on any future
dividend payment dates.
No dividends may be declared in respect of any dividend
period on any other series or class of preferred stock ranking on
a parity as to dividends with the Preferred Stock, Adjustable Rate
Preferred Stock or Fixed Rate Preferred Stock unless full
cumulative dividends on all outstanding shares of each series of
Preferred Stock on which dividends are cumulative and on the
Adjustable Rate Preferred Stock and the Fixed Rate Preferred Stock
shall have been paid in full or contemporaneously are declared and
paid through the most recent dividend payment date, unless
otherwise indicated in the Prospectus Supplement. In the event
that full cumulative dividends on such Preferred Stock, Adjustable
Rate Preferred Stock or Fixed Rate Preferred Stock have not been
declared and paid or set apart when due, the Company may not
declare or pay any dividends on, or make other distributions on or
make any payment on account of the purchase, redemption, or other
retirement, of its Common Stock or any other stock of the Company
ranking as to dividends or upon liquidation junior to such
Preferred Stock, Adjustable Rate Preferred Stock or Fixed Rate
Preferred Stock (other than, in the case of dividends or
distributions, dividends or distributions paid in shares of, or
options, warrants or rights to subscribe for or purchase shares of,
Common Stock or such other junior ranking stock), until full
cumulative dividends on such Preferred Stock, Adjustable Rate
Preferred Stock and Fixed Rate Preferred Stock are made or set
apart for payment, unless otherwise indicated in the Prospectus
Supplement.
When dividends are not paid in full upon any series of
Preferred Stock, the Adjustable Rate Preferred Stock, the Fixed
Rate Preferred Stock and any other preferred stock ranking on a
parity therewith all dividends declared or made upon shares of
Preferred Stock, Adjustable Rate Preferred Stock, Fixed Rate
Preferred Stock and any other series of preferred stock ranking on
a parity therewith shall be declared pro rata so that the amount of
dividends declared per share on Preferred Stock, Adjustable Rate
Preferred Stock, Fixed Rate Preferred Stock and such other
preferred stock shall in all cases bear to each other the same
ratio that accrued dividends per share (which, in the case of
Noncumulative Preferred Stock, shall not include any accumulation
in respect of unpaid dividends for prior dividend periods) on
shares of each series of the Preferred Stock, Adjustable Rate
Preferred Stock, Fixed Rate Preferred Stock and such other
preferred stock bear to each other. No interest shall be payable
in respect of any dividend payment which may be in arrears unless
otherwise indicated in the Prospectus Supplement.
Redemption
The shares of any series of Preferred Stock may be
redeemable at the option of the Company and may be subject to
mandatory redemption pursuant to a sinking fund or otherwise, in
each case upon the terms, on the date or dates and at the
redemption price or prices set forth in the Prospectus Supplement
relating to such series. If fewer than all shares of Preferred
Stock are to be redeemed, the shares to be redeemed shall be
selected by the Company pro rata or by lot, or by any other method
determined by the Board of Directors to be equitable.
Under regulations of the Federal Reserve Board, any
perpetual preferred stock with a feature permitting redemption at
the option of the issuer may qualify as capital only if the
redemption is subject to prior approval of the Federal Reserve
Board. Therefore, any redemption of Preferred Stock at the option
of the Company will require the prior approval of the Federal
Reserve Board in order for the Preferred Stock to qualify as
capital for bank regulatory purposes.
If any dividends on shares of any series of Preferred
Stock are in arrears, no shares of Common Stock or shares of
capital stock ranking junior to or on parity with the Preferred
Stock shall be redeemed and no shares of such series of Preferred
Stock shall be redeemed unless all outstanding shares of such
series are simultaneously redeemed, and the Company shall not
purchase or otherwise acquire any shares of such series; provided,
however, that the foregoing shall not prevent the purchase or
acquisition of shares of such series
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pursuant to a purchase or exchange offer made on the same terms
to holders of all outstanding shares of such series.
Notice of redemption shall be given by mailing the same
to each record holder of the shares to be redeemed, not less than
40 nor more than 70 days prior to the date fixed for redemption
thereof, to the respective addresses of such holders as the same
shall appear on the Company's stock books. Each such notice shall
state: (i) the redemption date; (ii) the number of shares and
series of the Preferred Stock to be redeemed; (iii) the redemption
price and the manner in which such redemption price is to be paid
and delivered; (iv) the place or places where certificates for such
shares of Preferred Stock are to be surrendered for payment of the
redemption price; and (v) that dividends on the shares to be
redeemed will cease to accrue on such redemption date. If fewer
than all shares of any series of the Preferred Stock held by any
holder are to be redeemed, the notice mailed to such holder shall
also specify the number of shares to be redeemed from such holder.
If notice of redemption has been given, from and after
the redemption date for the shares of the series of the Preferred
Stock called for redemption (unless default shall be made by the
Company in providing money for the payment of the redemption price
of the shares so called for redemption), dividends on the shares of
Preferred Stock so called for redemption will cease to accrue, any
right to convert the shares of Preferred Stock will terminate, such
shares will no longer be deemed to be outstanding, and all rights
of the holders thereof as stockholders of the Company (except the
right to receive the redemption price) will cease. Upon surrender
in accordance with such notice of the certificates representing any
shares so redeemed (properly endorsed or assigned for transfer, if
the Board of Directors of the Company will so require and the
notice shall so state), the redemption price set forth above will
be paid out of funds provided by the Company. If fewer than all of
the shares represented by any such certificate are redeemed, a new
certificate will be issued representing the unredeemed shares
without cost to the holder thereof.
Liquidation Preference
Upon any liquidation, dissolution or winding up of the
Company, the holders of shares of each series of Preferred Stock
and of the Adjustable Rate Preferred Stock and the Fixed Rate
Preferred Stock shall be entitled to receive out of the assets of
the Company available for distribution to stockholders, before any
distribution of assets is made to or set apart for the holders of
Common Stock or of any other shares of stock of the Company ranking
as to such a distribution junior to the shares of such series, with
respect to the Preferred Stock, an amount described in the
Prospectus Supplement relating to such series of Preferred Stock,
and with respect to the Adjustable Rate Preferred Stock and Fixed
Rate Preferred Stock, an amount equal to the liquidation value of
such shares. See "Description of Capital Stock--Existing
Preferred Stock." If, in any case of any such liquidation,
dissolution or winding up of the Company, the assets of the Company
or the proceeds thereof shall be insufficient to pay in full the
amounts payable with respect to shares of each series of Preferred
Stock, Adjustable Rate Preferred Stock and Fixed Rate Preferred
Stock and any other shares of stock of the Company ranking as to
any such distribution on a parity therewith, the holders of shares
of such series of Preferred Stock, Adjustable Rate Preferred Stock
and Fixed Rate Preferred Stock and of such other shares will share
ratably in any such distribution of assets of the Company in
proportion to the full respective preferential amounts to which
they are entitled. After payment to the holders of shares of such
series of Preferred Stock, Adjustable Rate Preferred Stock and
Fixed Rate Preferred Stock of the full preferential amounts to
which they are entitled, the holders of shares of such series of
Preferred Stock, Adjustable Rate Preferred Stock and Fixed Rate
Preferred Stock will not be entitled to any further participation
in any distribution of assets by the Company, unless otherwise
provided in the Prospectus Supplement. A consolidation or merger
of the Company with one or more corporations shall not be deemed to
be a liquidation, dissolution or winding up of the Company.
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Conversion and Exchange
The terms, if any, on which shares of any series of
Preferred Stock are convertible into or exchangeable for Notes,
Common Stock or Capital Securities will be set forth in the
Prospectus Supplement relating thereto. Such terms may include
provisions for conversion or exchange, either mandatory, at the
option of the holder, or at the option of the Company, in which the
number of shares of Common Stock to be received by the holders of
Preferred Stock would be calculated according to the market price
of Common Stock as of a time stated in the Prospectus Supplement.
Voting Rights
Except as indicated below or in the Prospectus Supplement
relating to a particular series of the Preferred Stock, or except
as expressly required by applicable law, the holders of Preferred
Stock will not be entitled to vote.
On matters on which holders of such series and holders of
any other series of Preferred Stock are entitled to vote as a
single class, each full share of any series of the Preferred Stock
shall be entitled to one vote. Therefore, the voting power of such
series will depend on the number of shares in such series, not the
liquidation preference or initial offering price of the shares of
such series of the Preferred Stock. However, as more fully
described under "Description of Depositary Shares," if the
Company elects to provide for the issuance of Depositary Shares
representing fractional interests in a share of a series of the
Preferred Stock, the holders of each such Depositary Share will, in
effect, be entitled through the Depositary to such fraction of a
vote, rather than a full vote. To the extent the Depositary does
not receive specific instructions from the holders of Depositary
Shares relating to such Preferred Stock, it will vote such shares
of Preferred Stock in accordance with the recommendation of the
Company, unless otherwise indicated in the Prospectus Supplement.
Whenever the Board of Directors shall have failed to
declare and pay dividends on a series of Preferred Stock,
Adjustable Rate Preferred Stock or Fixed Rate Preferred Stock for
dividend periods, whether or not consecutive, containing in the
aggregate a number of days equivalent to six calendar quarters, the
holders of such series of Preferred Stock, Adjustable Rate
Preferred Stock or Fixed Rate Preferred Stock (voting as a class
with all other affected series of Preferred Stock, Adjustable Rate
Preferred Stock and Fixed Rate Preferred Stock ranking on a parity
therewith either as to dividends or upon liquidation and upon which
like voting rights have been conferred and are exercisable) will be
entitled to vote for the election of two of the authorized number
of directors of the Company at the next annual meeting of
stockholders and at each subsequent meeting until all dividends
which the Board of Directors failed to declare or pay on such
series of Preferred Stock, Adjustable Rate Preferred Stock or Fixed
Rate Preferred Stock have been fully paid or set apart for payment.
In addition, under such circumstances, certain holders of Preferred
Stock, Adjustable Rate Preferred Stock and Fixed Rate Preferred
Stock may become subject to regulation as a bank holding company.
See "Description of Preferred Stock--General." The term of
office of all directors elected by the holders of Preferred Stock,
Adjustable Rate Preferred Stock and Fixed Rate Preferred Stock
shall terminate immediately upon the termination of the right of
the holders of Preferred Stock, Adjustable Rate Preferred Stock and
Fixed Rate Preferred Stock to vote for directors.
So long as any shares of Preferred Stock, Adjustable Rate
Preferred Stock and Fixed Rate Preferred Stock remain outstanding,
the Company shall not, without the consent of the holders of at
least two-thirds of the shares of the affected series of Preferred
Stock, Adjustable Rate Preferred Stock and Fixed Rate Preferred
Stock outstanding at the time (voting separately as a class with
all other affected series of Preferred Stock ranking on a parity
with the affected series of Preferred Stock, Adjustable Rate
Preferred Stock and Fixed Rate Preferred Stock), (i) authorize,
create or issue, or increase the authorized amount of, any class or
series of stock ranking prior to the affected series of Preferred
Stock, Adjustable Rate Preferred Stock and Fixed Rate Preferred
Stock as to dividends or upon liquidation; or (ii) amend, alter or
repeal the provisions of the Company's Restated Certificate of
Incorporation, whether by merger, consolidation or otherwise, so as
to
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materially and adversely affect any right, preference, privilege
or voting power of the affected series of Preferred Stock,
Adjustable Rate Preferred Stock or Fixed Rate Preferred Stock or
the holders thereof; provided, however, that any increase in the
amount of the authorized Common Stock or authorized Preferred Stock
or the creation and issuance of other series of common stock or
preferred stock ranking on a parity with or junior to the affected
series of Preferred Stock, Adjustable Rate Preferred Stock or Fixed
Rate Preferred Stock as to dividends and upon liquidation shall not
be deemed to materially and adversely affect such rights,
preferences, privileges or voting powers.
DESCRIPTION OF DEPOSITARY SHARES
The description set forth below and in any Prospectus
Supplement of certain provisions of the Deposit Agreement (as
defined below) and of the Depositary Shares and Depositary Receipts
does not purport to be complete and is subject to, and qualified in
its entirety by reference to, the form of Deposit Agreement and
form of Depositary Receipts relating to each series of the
Preferred Stock which are filed with the Commission as an exhibit
to the Registration Statement of which this Prospectus is a part.
General
The Company may, at its option, elect to offer fractional
interests in shares of Preferred Stock. The shares of any series
of the Preferred Stock underlying the Depositary Shares will be
deposited under a separate Deposit Agreement (the "Deposit
Agreement") between the Company and a bank or trust company
selected by the Company (the "Depositary"). The Prospectus
Supplement relating to a series of Depositary Shares will set forth
the name and address of the Depositary. Subject to the terms of
the Deposit Agreement, each owner of a Depositary Share will be
entitled, in proportion to the applicable fractional interest in a
share of Preferred Stock underlying such Depositary Share, to all
the rights and preferences of the Preferred Stock underlying such
Depositary Share (including dividend, voting, redemption,
conversion and liquidation rights).
The Depositary Shares will be evidenced by Depositary
Receipts issued pursuant to the Deposit Agreement, each of which
will represent the fractional interest in a share of a particular
series of the Preferred Stock described in the Prospectus
Supplement.
Unless otherwise specified in the Prospectus Supplement,
a holder of Depositary Shares is not entitled to receive the whole
shares of Preferred Stock underlying the Depositary Shares.
Dividends and Other Distributions
The Depositary will distribute all cash dividends or
other cash distributions received in respect of the Preferred Stock
to the record holders of Depositary Shares relating to such
Preferred Stock in proportion to the numbers of such Depositary
Shares owned by such holders on the relevant record date. The
Depositary shall distribute only such amount, however, as can be
distributed without attributing to any holder of Depositary Shares
a fraction of one cent, and any balance not so distributed shall be
added to and treated as part of the next sum received by the
Depositary for distribution to record holders of Depositary Shares.
In the event of a distribution other than in cash, the
Depositary will distribute property received by it to the record
holders of Depositary Shares entitled thereto, unless the
Depositary determines that it is not feasible to make such
distribution, in which case the Depositary may, with the approval
of the Company, sell such property and distribute the net proceeds
from such sale to such holders.
The Deposit Agreement also contains provisions relating
to the manner in which any subscription or similar rights offered
by the Company to holders of the Preferred Stock shall be made
available to holders of Depositary Shares.
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Redemption of Depositary Shares
If a series of the Preferred Stock underlying the
Depositary Shares is subject to redemption, the Depositary Shares
will be redeemed from the proceeds received by the Depositary
resulting from the redemption, in whole or in part, of such series
of the Preferred Stock held by the Depositary. The redemption
price per Depositary Share will be equal to the applicable fraction
of the redemption price per share payable with respect to such
series of the Preferred Stock. If less than all the Depositary
Shares are to be redeemed, the Depositary Shares to be redeemed
will be selected by lot or pro rata as may be determined by the
Depositary.
After the date fixed for redemption, the Depositary
Shares so called for redemption will no longer be deemed to be
outstanding and all rights of the holders of the Depositary Shares
will cease, except the right to receive the moneys payable upon
such redemption and any money or other property to which the
holders of such Depositary Shares were entitled upon such
redemption upon surrender to the Depositary of the Depositary
Receipts evidencing such Depositary Shares. Any funds deposited by
the Company with the Depositary for any Depositary Shares which the
holders thereof fail to redeem shall be returned to the Company
after a period of two years from the date such funds are so
deposited.
Voting
Upon receipt of notice of any meeting at which the
holders of the Preferred Stock are entitled to vote, the Depositary
will mail the information contained in such notice of meeting to
the record holders of the Depositary Shares relating to such
Preferred Stock. Each record holder of such Depositary Shares on
the record date (which will be the same date as the record date for
the Preferred Stock) will be entitled to instruct the Depositary as
to the exercise of the voting rights pertaining to the number of
shares of Preferred Stock underlying such holder's Depositary
Shares. The Depositary will endeavor, insofar as practicable, to
vote the number of shares of Preferred Stock underlying such
Depositary Shares in accordance with such instructions, and the
Company will agree to take all action which may be deemed necessary
by the Depositary in order to enable the Depositary to do so. To
the extent the Depositary does not receive specific instructions
from the holders of Depositary Shares relating to such Preferred
Stock, it will vote shares of Preferred Stock in accordance with
the recommendation of the Company, unless otherwise indicated in
the Prospectus Supplement.
Amendment of the Deposit Agreement
The form of Depositary Receipt evidencing the Depositary
Shares and any provision of the Deposit Agreement may at any time
be amended by agreement between the Company and the Depositary,
provided, however, that any amendment which materially and
adversely alters the rights of the existing holder of Depositary
Shares will not be effective unless such amendment has been
approved by the record holders of at least a majority of the
Depositary Shares then outstanding.
Charges of Depositary
The Company will pay all transfer and other taxes and
governmental charges that arise solely from the existence of the
depositary arrangements. The Company will pay charges of the
Depositary in connection with the initial deposit of the Preferred
Stock and any redemption of the Preferred Stock. Holders of
Depositary Shares will pay all other transfer and other taxes and
governmental charges, and, in addition, such other charges as are
expressly provided in the Deposit Agreement to be for their
accounts.
Taxation
Owners of Depositary Shares will be treated for Federal
income tax purposes as if they were owners of the Preferred Stock
represented by such Depositary Shares and, accordingly, will be
entitled to take
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into account for Federal income tax purposes
income and deductions to which they would be entitled if they were
holders of such Preferred Stock. In addition, (i) no gain or loss
will be recognized for Federal income tax purposes upon the
withdrawal of Preferred Stock in exchange for Depositary Shares as
provided in the Deposit Agreement, (ii) the tax basis of each share
of Preferred Stock to an exchanging owner of Depositary Shares
will, upon such exchange, be the same as the aggregate tax basis of
the Depositary Shares exchanged therefor, and (iii) the holding
period for shares of the Preferred Stock in the hands of an
exchanging owner of Depositary Shares who held such Depositary
Shares at the time of the exchange thereof for Preferred Stock will
include the period during which such person owned such Depositary
Shares.
Miscellaneous
The Company, or at the option of the Company, the
Depositary, will forward to the holders of Depositary Shares all
reports and communications from the Company which the Company is
required to furnish to the holders of the Preferred Stock.
Neither the Depositary nor the Company will be liable if
it is prevented or delayed by law or any circumstance beyond its
control in performing its obligations under the Deposit Agreement.
The obligations of the Company and the Depositary under the Deposit
Agreement will be limited to performance in good faith of their
duties thereunder and they will not be obligated to prosecute or
defend any legal proceeding in respect of any Depositary Shares or
Preferred Stock unless satisfactory indemnity is furnished. They
may rely upon written advice of counsel or accountants, or
information provided by persons presenting Preferred Stock for
deposit, holders of Depositary Shares or other persons believed to
be competent and on documents believed to be genuine.
Resignation and Removal of Depositary; Termination of the Deposit
Agreement
The Depositary may resign at any time by delivering to
the Company notice of its election to do so, and the Company may at
any time remove the Depositary, any such resignation or removal to
take effect upon the appointment of a successor Depositary and its
acceptance of such appointment. Such successor Depositary will be
appointed by the Company within 60 days after delivery of the
notice of resignation or removal. The Deposit Agreement may be
terminated at the direction of the Company or by the Depositary if
a period of 90 days shall have expired after the Depositary has
delivered to the Company written notice of its election to resign
and a successor depositary shall not have been appointed. Upon
termination of the Deposit Agreement, the Depositary will
discontinue the transfer of Depositary Receipts, will suspend the
distribution of dividends to the holders thereof, and will not give
any further notices (other than notice of such termination) or
perform any further acts under the Deposit Agreement except that
the Depositary will continue to deliver Preferred Stock
certificates together with such dividends and distributions and the
net proceeds of any sales of rights, preferences, privileges or
other property in exchange for Depositary Receipts surrendered.
Upon request of the Company, the Depositary shall deliver all
books, records, certificates evidencing Preferred Stock, Depositary
Receipts and other documents respecting the subject matter of the
Deposit Agreement to the Company.
DESCRIPTION OF CAPITAL STOCK
General
The Company is authorized to issue 150,000,000 shares of
Common Stock, par value $5.00 per share, and 25,000,000 shares of
preferred stock, par value $5.00 per share.
Common Stock
Holders of Common Stock are entitled to one vote for each
share of Common Stock held. All outstanding shares of Common Stock
are fully paid and nonassessable.
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Holders of Common Stock are entitled to receive such
dividends as are declared by the Board of Directors out of funds
legally available therefor subject to the limitations described
below. In the event of liquidation, holders of the Common Stock
are entitled to receive pro rata any assets distributable after
payment of liabilities and the liquidation preference, if any, on
any shares of Preferred Stock then outstanding. There are no
conversion, preemptive or redemption rights of the Common Stock.
The dividend rights and liquidation preferences relating to the
preferred stock are superior to those relating to the Common Stock.
The transfer agent and registrar for the Common Stock is
First Chicago Trust Company of New York, New York.
Existing Preferred Stock
As of the date of this Prospectus, the Company had four
series of preferred stock outstanding, consisting of 3,000,000
shares of Adjustable Rate Cumulative Preferred Stock, Series A,
1,500,000 shares of Adjustable Rate Cumulative Preferred Stock,
Series B, 477,500 shares of 9% Preferred Stock, Series C
represented by 9,550,000 Depositary Shares each representing a
one-twentieth interest in a share of 9% Preferred Stock and 350,000
shares of 8-7/8% Preferred Stock, Series D represented by 7,000,000
Depositary Shares each representing a one-twentieth interest in a
share of 8-7/8% Preferred Stock. The Adjustable Rate Preferred
Stock has a liquidation preference of $50 per share and the Fixed
Rate Preferred Stock has a liquidation preference of $500 per share
or $25 per Depositary Share. Unless full cumulative dividends on
the Preferred Stock, Adjustable Rate Preferred Stock and Fixed Rate
Preferred Stock have been paid, the Company may not declare
dividends on or make any other payment in respect of any class of
stock ranking junior to the Preferred Stock, Adjustable Rate
Preferred Stock or Fixed Rate Preferred Stock, including the Common
Stock. Whenever the Board of Directors of the Company shall have
failed to declare and pay dividends on any series of Preferred
Stock, Adjustable Rate Preferred Stock or Fixed Rate Preferred
Stock for dividend periods, whether or not consecutive, containing
in the aggregate a number of days equivalent to six calendar
quarters, the holders of such series of Preferred Stock, Adjustable
Rate Preferred Stock or Fixed Rate Preferred Stock (voting as a
class with all other affected series of Preferred Stock, Adjustable
Rate Preferred Stock or Fixed Rate Preferred Stock ranking on a
parity therewith either as to dividends or upon liquidation and
upon which like voting rights have been conferred and are
exercisable) will be entitled to vote for the election of two of
the authorized number of directors of the Company at the next
annual meeting of stockholders and at each subsequent meeting until
all dividends which the Board of Directors failed to declare or pay
on the affected series of Preferred Stock, Adjustable Rate
Preferred Stock or Fixed Rate Preferred Stock have been fully paid
or set apart for payment. The holders of Preferred Stock,
Adjustable Rate Preferred Stock and Fixed Rate Preferred Stock have
preference and priority over holders of Common Stock in the event
of liquidation for payment of the liquidation preference of the
Preferred Stock, Adjustable Rate Preferred Stock and Fixed Rate
Preferred Stock plus an amount equal to all accrued and unpaid
dividends thereon.
Capital Securities
Capital Securities may consist of Common Stock, Preferred
Stock or other capital securities of the Company that qualify at
the time of exchange or conversion as Capital Securities as
determined by the Company's primary federal regulator. Such other
Capital Securities will have such terms as may be determined by the
Company. All such Capital Securities that will be exchangeable for
Offered Securities or issuable upon conversion of Offered
Securities will be, upon issuance, duly authorized, validly issued
and, if applicable, fully paid and nonassessable. See "Description
of Preferred Stock" and "Description of Capital Stock--Common
Stock."
PLAN OF DISTRIBUTION
The Company and certain holders of Offered Securities may
offer and sell the Offered Securities to one or more underwriters
for resale by them or through agents, or to investors directly.
The Prospectus
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Supplement with respect to each series of Offered
Securities will set forth the terms of the offering of the Offered
Securities, including the name or names of any underwriters or
agents, the purchase price of the Offered Securities and the net
proceeds to the Company or selling securityholders from such sale,
any underwriting discounts, agency fees and other items
constituting underwriters' or agents' compensation, any initial
public offering price, any discounts or concessions allowed,
reallowed or paid to dealers and the place and time of delivery.
If any underwriters are involved in the offer and sale,
the Offered Securities will be acquired by the underwriters for
their own account and may be resold from time to time in one or
more transactions, including negotiated transactions, at a fixed
public offering price or at varying prices determined at the time
of sale. Unless otherwise set forth in the accompanying Prospectus
Supplement, the obligations of the underwriters to purchase the
Offered Securities will be subject to certain conditions precedent
and the underwriters will be obligated to purchase all the Offered
Securities described in such Prospectus Supplement if any are
purchased. Any initial public offering price and any discounts or
concessions allowed or reallowed or paid to dealers may be changed
from time to time.
Underwriters and agents may be entitled, under agreements
entered into with the Company, to indemnification by the Company
against certain liabilities, including liabilities under the
Securities Act of 1933.
Employees of the Bank may act as finders of purchasers of
Offered Securities. Their activities will be limited to contacting
customers and informing them of the terms of the Offered Securities
offered by the Company. The Company believes that such persons are
not required to be registered as brokers or dealers under Section
3(a)(4) and 3(a)(5) of the Act since they are acting as employees
on behalf of a bank.
LEGAL OPINIONS
The legality of the Offered Securities offered hereby
will be passed upon for the Company by Brobeck, Phleger & Harrison,
San Francisco, for the underwriters, if any, by Davis Polk &
Wardwell, New York City and for the agents, if any, by Brown &
Wood, San Francisco. Brobeck, Phleger & Harrison may rely on the
opinion of Davis Polk & Wardwell or Brown & Wood, as the case may
be, as to matters of New York law. Davis Polk & Wardwell may rely
on the opinion of Brobeck, Phleger & Harrison as to matters of
California law. Davis Polk & Wardwell represents the Company from
time to time.
EXPERTS
The consolidated financial statements of the Company as
of December 31, 1992 and 1991 and for each of the years in the
three-year period ended December 31, 1992 incorporated by reference
in the Company's Annual Report on Form 10-K for the year ended
December 31, 1992 incorporated by reference herein and elsewhere in
the Registration Statement have been incorporated by reference
herein and in the Registration Statement in reliance upon the
report of KPMG Peat Marwick, independent certified public
accountants, incorporated by reference herein, and upon the
authority of said firm as experts in accounting and auditing.
21
<PAGE>
No dealer, salesperson or other individual has been authorized
to give any information or make any representations not contained
or incorporated by reference in this Prospectus Supplement and the
Prospectus in connection with the offering covered by this
Prospectus Supplement and the Prospectus. If given or made, such
information or representations must not be relied upon as having
been authorized by the Company or the Agents. This Prospectus
Supplement and the Prospectus does not constitute an offer to sell,
or solicitation of an offer to buy, the Notes in any jurisdiction
where, or to any person to whom, it is unlawful to make such offer
or solicitation. Neither the delivery of this Prospectus
Supplement and the Prospectus nor any sale made hereunder shall,
under any circumstances, create an implication that there has not
been any change in the facts set forth in this Prospectus
Supplement and the Prospectus or in the affairs of the Company
since the date hereof.
TABLE OF CONTENTS
Page
Prospectus Supplement
Description of Medium-Term Notes........ S- 2
Federal Tax Considerations.............. S-12
Plan of Distribution.................... S-16
Prospectus
Available Information................... 2
Incorporation of Certain Documents
by Reference............................ 2
Wells Fargo & Company................... 2
Use of Proceeds......................... 3
Summary Financial Data.................. 4
Description of Notes.................... 6
Description of Preferred Stock.......... 12
Description of Depositary Shares........ 17
Description of Capital Stock............ 19
Plan of Distribution.................... 20
Legal Opinions.......................... 21
Experts................................. 21
$1,500,000,000
Company Logo - Stagecoach, Horses
Wells Fargo & Company
Medium-Term Notes
and
Subordinated Medium-Term
Notes, Series B
Due from 9 Months to
12 Years from Date of Issue
PROSPECTUS SUPPLEMENT
Merrill Lynch & Co.
CS First Boston
Goldman, Sachs & Co.
Lehman Brothers
Morgan Stanley & Co.
Incorporated
Salomon Brothers Inc
March 24, 1994
<PAGE>
APPENDIX
Company Logo - Cover Page, Page 35, Page 78
